Independence Contract Drilling Inc. (NYSE: ICD) has amended its existing senior secured revolving credit facility and modified certain covenants to improve the company's financial flexibility.
The amended credit facility modifies the leverage ratio covenant (net debt/adjusted EBITDA) so that it increases from 3.75 in the first quarter of 2016 to 4.50 during the fourth quarter of 2016. The leverage ratio returns to 3.00 at the end of the second quarter of 2017. The amendments to the credit facility also reduce the minimum rig utilization covenant to 60% in 2016 and 70% in 2017, and provide for the exclusion of certain planned capital expenditures from consideration for purposes of calculating the fixed charge coverage ratio under that covenant.
As of Sept. 30, the company had net debt of approximately $55.1 million. As amended, the credit facility provides for aggregate commitments of $125 million. The credit facility maintains its maturity date of Nov. 4, 2018.
Independence Contract Drilling provides land-based contract drilling services for oil and natural gas producers in the US. The company constructs, owns, and operates a fleet of ShaleDriller rigs.