GMX Resources announced that the company has successfully concluded negotiations with its banking syndicate on issues involving the company’s senior credit facility. The company has a $250 million senior secured revolving credit facility with a group of lenders led by Capital One Bank.
GMX Resources said that Capital One Bank has reaffirmed the company’s borrowing base at $130 million. This borrowing base is reaffirmed two times during each calendar year, with the next reaffirmation scheduled to be completed before April 2011.
GMX Resources reported that a financial covenant in the credit facility was amended by Capital One Bank. GMX Resources must maintain a Total Net Debt to EBITDA of 4.75 to 1 from now through February 2011. This covenant decreases to 4.6 to 1 from March to August 2011, to 4.4 to 1 from August 2011 until October 2011 and then 4 to 1 until the credit facility matures.
Other banks in the group led by Capital One Bank include Bank of America Merrill Lynch, BNP Paribas, US Bank, and BBVA Compass.
GMX Resources also announced that the company will spend $110 million in capital in 2011 to develop oil and gas wells on its acreage in Texas and Louisiana. The company is focused on the Haynesville Shale formation.
For more information on the company, go to www.gmxresources.com