COVINGTON, La., June 15,
2017 /PRNewswire/ -- Hornbeck Offshore Services, Inc. (NYSE:HOS)
("the Company") announced today that the Company has refinanced its
existing $200 million senior secured
revolving credit facility (the "Old Credit Facility") with a new
first-lien delayed-draw credit facility providing for up to
$300 million of term loans (the "New
Credit Facility"). The six-year term of the New Credit
Facility extends the maturity of the Old Credit Facility from
February 2020 to June 2023.
The New Credit Facility enhances the Company's financial
flexibility by (i) increasing liquidity from the currently
applicable borrowing base of $75
million under the Old Credit Facility, (ii) extending the
maturity date that existed under the Old Credit Facility by over
three years, and (iii) eliminating all of the existing financial
ratio maintenance covenants and the anti-cash hoarding provision of
the Old Credit Facility.
The New Credit Facility may be used for working capital and
general corporate purposes, including the acquisition of distressed
assets and/or the refinancing of existing debt, subject to, among
other things, compliance with certain minimum liquidity (cash and
credit availability) requirements.
Borrowings under the New Credit Facility accrue interest, at the
Company's option, at either the LIBOR rate or Base Rate. The
cash-pay LIBOR spread for floating-rate funded borrowings under the
New Credit Facility is L+600 in year one, L+650 in year two, L+700
in year three, L+725 in year four and L+750 thereafter; subject to
a 1.00% LIBOR floor. The Base Rate spreads are 100 bps less than
the LIBOR rate spreads for each respective year. The New
Credit Facility is pre-payable at 102% of principal in year one,
101% of principal in year two, and at par thereafter.
The Company focused its efforts on lowering the interest rate
in, and limiting the call protection to, the first two years.
Should industry market conditions improve sufficiently by
year three, the Company may be able to refinance the New Credit
Facility on more favorable terms at such time.
The Company also has the option, exercisable anytime or from
time-to-time during the six-year term of the loan, of paying
interest on the New Credit Facility "in-kind" (accruing to the
outstanding principal of the loan, or PIK Interest), subject to a
100 basis-point step-up in interest rate and a minimum 3% cash-pay
coupon for so long as the Company elects to pay PIK Interest,
subject to any and all debt incurrence and permitted lien
restrictions then in effect under any outstanding loan agreements
or bond indentures as of the time of such increase in
principal.
The Company's exclusive financial advisor in connection with the
transaction was PricewaterhouseCoopers Corporate Finance, LLC and
the Company's legal advisors were Latham & Watkins, LLP and
Winstead PC.
The foregoing is only a summary, is not necessarily complete,
and is qualified by the full text of the First Lien Term Loan
Agreement and the First Lien Guaranty and Collateral Agreement,
which will be filed as exhibits to the Company's Current Report on
Form 8-K related to this matter, expected to be filed
today.
Hornbeck Offshore Services, Inc. is a leading provider of
technologically advanced, new generation offshore service vessels
primarily in the Gulf of Mexico
and Latin America.
Forward-Looking Statements
This news release contains forward-looking statements,
including, in particular, statements about the Company's plans and
intentions with regard to the New Credit Facility, the availability
of the delayed draws and potential uses of proceeds. These
statements are based on the Company's current assumptions,
expectations and projections about future events. Although
the Company believes that the expectations reflected in these
forward-looking statements are reasonable, the Company can give no
assurance that the expectations will prove to be correct, including
whether and to what extent the Company will arrange any additional
tranches of debt facilities or whether it will be able to refinance
the New Credit Facility on more favorable terms prior to its
scheduled maturity.
Contacts:
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Todd Hornbeck,
CEO
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Jim Harp,
CFO
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|
Hornbeck Offshore
Services
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985-727-6802
|
|
|
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Ken Dennard, Managing
Partner
|
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Dennard-Lascar /
713-529-6600
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SOURCE Hornbeck Offshore Services, Inc.