Only be guessing here TT, (and I am assuming some form of equity being raised),
1. If there is not a Asset Coverage Ratio in the RBL I would expect to see one added to mimic the Term Loan
2. I would expect to see some form of Minimum Liquidity Amount being added - so force the company to raise enough equity to keep say 10% - 20% of the amount drawn on RBL as a MLA. So if Facility is $250M and elected Borrowing Base is $150 (and assume drawn to $125M .... so total debt is $375M ... and at 1.5 x you need a PV9 of about $565M) then the MLA at 20% of $125M = $25M ... in reality means they are reducing the available liquidity.
3. Might see some form of scaled Debt/EBITDAX going from say 4.0x for Q2 (an increase due to tough times) and then see it drop down to 3.75x in Q3 to 3.5x in Q4 to 3.0x in 2021.
That's if I was the Banker because I think the risk is high and highly dependent on oil price recovery (which means no global recesssion as that would keep demand low and the supply glut intact).
SEA Price at posting:
16.5¢ Sentiment: None Disclosure: Held
