EV Energy Partners emerged from Chapter 11 as a new corporation under the name Harvest Oil & Gas. Through the restructuring, Harvest eliminated approximately $355 million of debt and accrued interest from its balance sheet and significantly enhanced its financial flexibility.
At its emergence, the company entered into an amended and restated credit facility providing for a new reserve-based revolving loan. The initial borrowing base under the credit facility is $325 million, with the first scheduled redetermination of the borrowing base in April 2019. With total debt outstanding of $297 million, and cash on hand of approximately $21 million, total liquidity will be approximately $46 million.
According to a related 8-K filing, JPMorgan is administrative agent for the new reserve-based revolving loan (RBL) which has a maximum credit amount of $1 billion.
The initial borrowing base in respect of the RBL is $325 million. There are no scheduled borrowing base redeterminations until April 1, 2019 and semi-annually thereafter.
The outstanding borrowings under the RBL bear interest at a rate equal to a customary interbank offered rate plus an applicable margin of 2.5% to 3.5% per annum, based upon utilization. The RBL is not subject to amortization and matures on February 26, 2021.
“Today begins an important new chapter for our company. With significantly less debt, we have ample liquidity and expect to generate free cash flow in excess of our planned capital requirements. We are confident that our diverse asset base will serve as a foundation for our future success,” said Michael E. Mercer, Harvest president and CEO.
Kirkland & Ellis served as legal counsel and Perella Weinberg Partners as financial advisor to the company in connection with its restructuring efforts.
Akin Gump Strauss Hauer & Feld served as legal counsel, and Intrepid Partners served as financial advisor to certain noteholders. Simpson Thacher & Bartlett served as legal counsel and RPA Advisors served as financial advisor to the administrative agent for the lenders.
Harvest is an independent oil and gas company engaged in the acquisition, efficient operation and development of onshore oil and gas properties in the continental U.S.
