Newpark Resources amends credit agreement

Newpark Resources Inc. (NYSE: NR) has entered into a first amendment to third amended and restated credit agreement, amending provisions of its existing credit agreement.

The amendment was principally entered into as a result of the company's anticipation of noncompliance with the consolidated leverage ratio financial covenant under its existing third amended and restated credit agreement dated as of March 6. The amendment decreases the size of the facility, modifies certain financial covenants through the first quarter of 2017, and also modifies the borrowing cost and fee provisions.

Pursuant to the amendment, the revolving facility has been reduced from $200 million to $150 million. In addition, a temporary increase has been made to the consolidated leverage ratio covenant, increasing the ratio from the current 4.0:1.0 limitation to 5.5:1.0 through 2016, then reducing to 4.5 in the first quarter of 2017, and returning to 4.0 thereafter.

During the same period, the senior secured leverage ratio covenant is being reduced from the current 3.0:1.0 limitation to 2.0:1.0 through 2016, then increasing to 2.5 in the first quarter of 2017, and returning to 3.0 thereafter. The calculation for these two ratios has also been modified to allow for up to $10 million of adjustments for severance costs, as well as foreign exchange impacts related to Brazilian intercompany financial restructuring. Also, the amendment increases the borrowing cost by 25–50 basis points and increases the commitment fee by 12.5 basis points, but only in the event the consolidated leverage ratio equals or exceeds 2.5:1.0. There are currently no outstanding borrowings under the revolving credit facility.

Newpark Resources is a global provider of drilling fluids systems and composite matting systems used in oilfield and other commercial markets. 

Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now


Making DDoS Mitigation Part of Your Incident Response Plan: Critical Steps and Best Practices

Like a new virulent strain of flu, the impact of a distributed denial of service (DDoS) attack is...

The Multi-Tax Challenge of Managing Excise Tax and Sales Tax

To be able to accurately calculate multiple tax types, companies must be prepared to continually ...

Operational Analytics in the Power Industry

Cloud computing, smart grids, and other technologies are changing transmission and distribution. ...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...