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FTS International enters into $250 million five-year ABL facility
By Sarah Lizee
Olympia, Wash., Feb. 22 – FTS International, Inc. obtained a five-year asset-based lending facility providing for up to $250 million for revolving credit loans, with a sublimit of $50 million for letters of credit.
The company entered into the credit agreement with Wells Fargo Bank, NA as administrative agent on Thursday, according to an 8-K filing with the Securities and Exchange Commission.
The facility, which matures Feb. 22, 2023, may be increased up to an additional $100 million.
The maturity date is subject to adjustment in the event that either the term loan agreement dated April 16, 2014 with Wells Fargo as administrative agent or the company’s 6¼% senior secured notes due May 1, 2022 reach their maturity dates before the ABL facility.
Borrowings bear interest at Libor plus 175 basis points or 200 bps, depending on the amount of utilization of the ABL facility.
There is an unused commitment fee of 25 bps or 37.5 bps, also depending on the amount of utilization.
The credit agreement contains a springing financial covenant that requires the company and restricted subsidiaries to maintain a consolidated fixed charge coverage ratio of at least 1.0 to 1.0 during test periods based on borrowing availability or following the occurrence of an event of default.
FTS said it intends to utilize the facility for the issuance of letters of credit, as well as general working capital purposes in order to provide the company with more flexibility and borrowing capacity.
As of Thursday, the facility is undrawn.
The company has $5.85 million in outstanding letters of credit, which are deemed to be outstanding under the ABL facility.
Additionally, the company said it prepaid $50 million under its term loan agreement on Thursday.
Fort Worth-based FTS provides well-completion services, including pressure pumping, wireline and reservoir optimization technologies.
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