Vanguard Natural Resources obtained a $50 million debtor-in-possession facility in connection with its Chapter 11 filing with the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division.

Citibank, JPMorgan Securities and Wells Fargo underwrote the DIP facility.

Subject to court approval, the DIP financing, combined with the company’s cash from operations, is expected to provide sufficient liquidity during the Chapter 11 cases to support its continuing business operations and minimize disruption.

Under the restructuring support agreement, a fully committed $19.25 million equity investment by second lien noteholders and a $255.75 million rights offering fully backstopped by senior noteholders of notes is due in 2019 and 2020. Through these transactions, the company would eliminate approximately $708 million in debt under the company’s reserve-based credit facility and senior unsecured debt.

Paul Hastings is serving as legal counsel, and Evercore Partners is acting as financial advisor to Vanguard. Opportune is the company’s restructuring advisor.

“We continue to believe in the quality of our asset base and the dedication and competence of our office and field employees,” said Scott W. Smith, president and CEO.

Vanguard Natural Resources is a publicly traded limited liability company focused on the acquisition, production and development of oil and natural gas properties.