RAAM Global Energy extends exchange offer for 12½% notes due 2015

By Susanna Moon

Chicago, July 1 – RAAM Global Energy Co. said it amended its offer to exchange any and all of its outstanding 12½% senior secured notes due 2015.

The exchange offer will now end at 11:59 p.m. ET on July 9, extended from July 1, with withdrawal rights extended to 5 p.m. ET on July 9, according to a company press release.

As of 5 p.m. ET on July 1, holders had tendered $225.8 million principal amount, or about 94.9%, of the outstanding principal amount of notes.

In exchange for tendered notes, the company is offering to issue new 12½% senior secured notes due 2019 and shares of RAAM’s common stock.

RAAM also is soliciting consents to amend the notes indenture.

In addition to extending the expiration, the amendments also mean that holders who tender their notes will no longer become party to a shareholders agreement with the company and certain stockholders, the company said. Instead, RAAM will amend its bylaws to reflect agreements that were previously included in the shareholders agreement, specifically, to permit Farallon Capital Management, LLC and Stonehill Capital Management to each appoint two individuals to serve on RAAM’s board of directors, and members of RAAM’s senior management to appoint three individuals to fill the remaining seats on the board.

As long as Farallon and its affiliates or Stonehill and its affiliates beneficially own at least 10% of the issued and outstanding shares of RAAM’s common stock, Farallon or Stonehill will have the right to designate two directors. If Farallon and its affiliates or Stonehill and its affiliates beneficially own less than 10% of the issued and outstanding shares of RAAM’s common stock, Farallon or Stonehill will not have the right to designate any directors to the board. Assuming that 100% of the notes are tendered in the exchange offer, Farallon and Stonehill will collectively own about 61% of RAAM’s common stock.

The exchange shares will now be DTC eligible.

RAAM is a Lexington, Ky.-based oil and gas company.

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