HOUSTON, July 12, 2016 /PRNewswire/ -- PATTERSON-UTI
ENERGY, INC. (NASDAQ: PTEN) announced today that it has amended
its $500 million senior unsecured
revolving credit agreement to, among other things, extend the
maturity date of $357.9 million in
revolving credit commitments of certain lenders from September 27, 2017 to March 27, 2019. In addition, the Company
has repaid the entire outstanding $230
million principal amount of its bank term loans, and has
$70 million outstanding under the
revolving credit facility.
The amendment provides that borrowings under the revolving
credit facility will be subject to a borrowing base calculated by
reference to the Company's and certain of its subsidiaries'
eligible equipment, inventory, accounts receivable and unencumbered
cash. When the borrowing base is determined based on July 31, 2016 balances, the Company expects its
borrowing base to be approximately $360
million.
Andy Hendricks, Patterson-UTI's
Chief Executive Officer, stated, "We are very pleased to have
entered into this extension of our senior unsecured credit
agreement, and we appreciate the confidence in our Company shown by
the extending lenders."
John Vollmer, Patterson-UTI's
Chief Financial Officer added, "We believe that we have further
solidified the Company's liquidity with this credit facility
amendment. The repayment of the two bank term loans reduces
our interest costs going forward and, with these repaid, we do not
have any term debt maturities until October 2020. Also, we
believe the modified line of credit with an extended maturity of
March 27, 2019 will provide us with
ample liquidity to finance working capital requirements during a
recovery in industry activity. Additionally, we believe the amended credit facility
effectively eases our ability to pay quarterly cash dividends
compared to the restrictive covenant in the now-terminated term
loan agreement."
The amendment also amends the interest rates applicable to
borrowings under the credit agreement such that the borrowings will
bear interest until September 27,
2017 at either the eurodollar rate plus a margin ranging
from 2.75% to 3.25% or at the base rate plus a margin ranging from
1.75% to 2.25%, in each case based on the Company's debt to
capitalization ratio, and on and after September 27, 2017 at either the eurodollar rate
plus a margin ranging from 3.25% to 3.75% or at the base rate plus
a margin ranging from 2.25% to 2.75%, in each case based on the
Company's excess availability under the credit agreement.
The amendment also, among other
things, amends the debt to capitalization ratio covenant to
decrease the maximum permitted ratio to 40%, adds an anti-cash
hoarding covenant that limits the holding of proceeds from a
borrowing, and adds a covenant that restricts the Company's ability
to pay dividends and make equity repurchases in certain
circumstances. The Company would be permitted to make
dividend payments and equity repurchases if before and immediately
after giving effect to such payment, the pro forma debt service
coverage ratio is at least 1.50 to 1.00.
About Patterson-UTI
Patterson-UTI Energy, Inc. subsidiaries provide onshore contract
drilling and pressure pumping services to exploration and
production companies in North America. Patterson-UTI Drilling
Company LLC and its subsidiaries operate land-based drilling rigs
in oil and natural gas producing regions of the continental
United States and western
Canada. Universal Pressure
Pumping, Inc. and Universal Well Services, Inc. provide pressure
pumping services primarily in Texas and the Appalachian region.
Location information about the Company's drilling rigs and their
individual inventories is available through the Company's website
at www.patenergy.com.
Statements made in this press release which state the
Company's or management's intentions, beliefs, expectations or
predictions for the future are forward-looking statements. It is
important to note that actual results could differ materially from
those discussed in such forward-looking statements. Important
factors that could cause actual results to differ materially
include, but are not limited to, volatility in customer spending
and in oil and natural gas prices, which could adversely affect
demand for our services and their associated effect on rates,
utilization, margins and planned capital expenditures; global
economic conditions; excess availability of land drilling rigs and
pressure pumping equipment, including as a result of low commodity
prices, reactivation or construction; liabilities from operations;
decline in, and ability to realize, backlog; equipment
specialization and new technologies; adverse industry conditions;
adverse credit and equity market conditions; difficulty in building
and deploying new equipment; difficulty in integrating
acquisitions; shortages, delays in delivery and interruptions of
supply of equipment, supplies and materials; weather; loss of, or
reduction in business with, key customers; legal proceedings;
ability to effectively identify and enter new markets; governmental
regulation; and ability to retain management and field personnel.
Additional information concerning factors that could cause actual
results to differ materially from those in the forward-looking
statements is contained from time to time in the Company's SEC
filings, which may be obtained by contacting the Company or the
SEC. These filings are also available through the Company's web
site at http://www.patenergy.com or through the SEC's
Electronic Data Gathering and Analysis Retrieval System (EDGAR)
at http://www.sec.gov. We undertake no obligation to
publicly update or revise any forward-looking statement.
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SOURCE PATTERSON-UTI ENERGY, INC.