Approach gets $1 billion five-year revolver at Libor plus 150-250 bps

By Susanna Moon

Chicago, May 8 - Approach Resources Inc. entered into an amended and restated credit agreement on Wednesday that provides for a $1 billion senior secured revolving credit facility with a $450 million initial borrowing base, according to an 8-K filing with the Securities and Exchange Commission.

Interest on the loans is Libor plus 150 basis points to 250 bps with a commitment fee of 37.5 bps to 50 bps, based on the borrowings outstanding compared to the borrowing base.

The new facility has a maturity date of May 7, 2019.

The borrowing base will be reset semiannually based on the company's oil, natural gas liquids and gas reserves.

The financial covenants include a consolidated modified current ratio covenant that requires the company to maintain a current ratio of at least 1.0 to 1.0 as of the last day of any fiscal quarter and a ratio of consolidated EBITDAX to interest of at least 2.5 to 1.0 as of the last day of any fiscal quarter.

JPMorgan Chase Bank, NA is the administrative agent, and KeyBank NA is the documentation agent.

Approach Resources is a Fort Worth, Texas-based oil and gas company.

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