The Exchange Transaction will:
- Reduce the Company’s long-term debt by
- Generate approximately
$40 millionin future interest savings and enhance the Company’s liquidity;
- Provide the Company flexibility to increase its capital budget out of operating cash flow and return the Company to production growth in anticipation of a continued commodity price recovery;
- Increase the Company’s financing and strategic flexibility by removing certain restrictive covenants from the existing Senior Notes indenture; and
- Align the Company with a significant investor in an integrated oilfield service business.
Following the closing of the Exchange Transaction, Wilks became the Company’s largest shareholder, holding approximately 48.5% of the outstanding Common Stock of Approach. Pursuant to the Exchange Agreement between the Company and Wilks dated
In connection with the Exchange Agreement, the Company also entered into a Stockholders Agreement with Wilks (the “Stockholders Agreement”). Under the Stockholders Agreement, the Company has appointed three Wilks’ designees to the Board of Directors of the Company,
The Company also has agreed to offer to exchange its remaining
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically relate to consummation of the Follow-On Exchange Offer. These statements are based on certain assumptions made by the Company based on management’s experience, perception of historical trends and technical analyses, current conditions, anticipated future developments and other factors believed to be appropriate and reasonable by management. When used in this press release, the words “will,” “potential,” “believe,” “estimate,” “intend,” “expect,” “may,” “should,” “anticipate,” “could,” “plan,” “predict,” “project,” “profile,” “model” or their negatives, other similar expressions or the statements that include those words, are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These risks, uncertainties, assumptions and other important factors include, but are not limited to (1) the inability to complete the Follow-On Exchange Offer, (2) the failure to achieve 100% participation in the Follow-On Exchange Offer, (3) a continued decline in commodities prices, (4) the Company’s ability to recognize the anticipated benefits of the Exchange Transaction and the Follow-On Exchange Offer, (5) costs related to the Exchange Transaction and the Follow-On Exchange Offer, (6) changes in applicable laws or regulations, and (7) other risks and uncertainties indicated from time to time in the definitive proxy statement filed with the
NO OFFER OR SOLICITATION
THIS PRESS RELEASE IS NEITHER AN OFFER TO PURCHASE NOR A SOLICITATION TO BUY ANY OF THE EXISTING SENIOR NOTES NOR IS IT A SOLICITATION FOR ACCEPTANCE OF THE FOLLOW-ON EXCHANGE OFFER. THE COMPANY IS MAKING THE FOLLOW-ON EXCHANGE OFFER ONLY BY, AND PURSUANT TO THE TERMS OF, THE OFFERS TO EXCHANGE AND LETTERS OF TRANSMITTAL. THE FOLLOW-ON EXCHANGE OFFER IS NOT BEING MADE IN ANY JURISDICTION IN WHICH THE MAKING OR ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE WITH THE SECURITIES, BLUE SKY OR OTHER LAWS OF SUCH JURISDICTION. NONE OF THE COMPANY, ANY INFORMATION AGENT OR ANY EXCHANGE AGENT FOR THE FOLLOW-ON EXCHANGE OFFER MAKES ANY RECOMMENDATION IN CONNECTION WITH SUCH EXCHANGE OFFER. THIS ANNOUNCEMENT IS NEITHER AN OFFER TO SELL NOR A SOLICITATION OF AN OFFER TO BUY ANY OF THESE SECURITIES AND SHALL NOT CONSTITUTE AN OFFER, SOLICITATION OR SALE IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE IS UNLAWFUL.
Suzanne OgleVice President - Investor Relations & Corporate Communications email@example.com 817.989.9000 APPROACH RESOURCES INC.One Ridgmar Centre 6500 West Freeway, Suite 800 Fort Worth, Texas76116 www.approachresources.com