Enservco Closes Agreement with Lender to Amend its Senior Revolving Credit Facility, Substantially Reduce Debt and Strengthen...
September 28 2020 - 8:30AM
Enservco Corporation (NYSE American: ENSV), a diversified national
provider of specialized well-site services to the domestic onshore
conventional and unconventional oil and gas industries, today
announced it has closed its refinancing agreement with East West
Bank (“EWB”).
The refinancing significantly strengthens Enservco’s balance
sheet by cutting its bank debt nearly in half and increasing
shareholders’ equity by approximately $17.5
million.
“We are extremely pleased to have finalized this
transformational agreement with EWB that not only creates a more
viable financial structure, but also adds EWB as a major equity
holder,” said Executive Chairman Rich Murphy, whose investment
firm, Cross River Partners, is Enservco’s largest shareholder.
“With this lengthy process now behind us, we are excited to
re-focus our full attention on building our business. We are
gearing up to meet an expected seasonal increase in demand during
our fourth quarter of 2020 and first quarter of 2021 when Enservco
generates the majority of its revenue and profitability.”
The new financing includes a $17 million term loan and a $1
million working capital revolving line of credit with no initial
balance – both of which have October 15, 2021, maturity dates. The
term loan is interest only with potential for principal payments in
the event Enservco reaches certain profit metrics. In return for
the $16 million in debt reduction, Enservco issued to EWB eight
million shares of restricted common stock that will not be
tradeable for six months and 15 million common stock purchase
warrants exercisable at $0.25 per share beginning October 15, 2021,
through October 15, 2026. Complete details of the refinancing are
available on the Form 8-K filed by Enservco with the SEC on
September 28, 2020.
About
Enservco
Through its various operating subsidiaries, Enservco provides a
wide range of oilfield services, including hot oiling, acidizing,
frac water heating and related services. The Company has a broad
geographic footprint covering seven major domestic oil and gas
basins and serves customers in Colorado, Montana, New Mexico, North
Dakota, Oklahoma, Pennsylvania, Ohio, Texas, Wyoming and West
Virginia. Additional information is available at
www.enservco.com
Cautionary Note Regarding Forward-Looking
Statements
This news release contains information that is "forward-looking"
in that it describes events and conditions Enservco reasonably
expects to occur in the future. Expectations for the future
performance of Enservco are dependent upon a number of factors, and
there can be no assurance that Enservco will achieve the results as
contemplated herein. Certain statements contained in this release
using the terms "may," “intends,” "expects to," and other terms
denoting future possibilities, are forward-looking statements. The
accuracy of these statements cannot be guaranteed as they are
subject to a variety of risks, which are beyond Enservco's ability
to predict, or control and which may cause actual results to differ
materially from the projections or estimates contained herein.
Among these risks are those set forth in Enservco’s annual report
on Form 10-K for the year ended December 31, 2019, and subsequently
filed documents with the SEC. Forward looking statements in this
news release that are subject to risk include the potential for the
transaction to be transformative, the short-term nature of the
revised financing, the expectation of increased customer demand,
and the ability to build the business or raise additional equity.
It is important that each person reviewing this release understand
the significant risks attendant to the operations of Enservco.
Enservco disclaims any obligation to update any forward-looking
statement made herein, except as required by law.
Contacts:
Jay PfeifferPfeiffer High Investor Relations,
Inc.Phone: 303-880-9000Email: jay@pfeifferhigh.com
Marjorie HargraveChief Financial OfficerEnservco
Corporationmhargrave@enservco.com
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