THE WOODLANDS, Texas,
June 11, 2020 /PRNewswire/
-- CSI Compressco LP ("CSI Compressco" or the "Partnership")
(NASDAQ: CCLP) today announced the results of its offer to exchange
for its outstanding principal amount of 7.25% Senior Unsecured
Notes due 2022 for newly issued 7.50% Senior Secured First Lien
Notes due 2025 and 10.0%/10.75% Senior Secured Second Lien Notes
due 2026, upon the terms and conditions set forth in the
Confidential Offering Memorandum and Consent Solicitation Statement
dated April 17, 2020, as amended and
supplemented as of the date hereof. The exchange offer
expired on June 10, 2020.
As of the expiration time, approximately $215 million principal amount of unsecured notes
had been validly tendered in the exchange offer, representing 72.7%
of the outstanding unsecured notes. Accordingly, the Partnership
has received consents sufficient to approve the proposed amendments
to the indenture governing the unsecured notes, and the Partnership
and the trustee for the unsecured notes will enter into a
supplemental indenture containing such proposed amendments. The
proposed amendments will become operative upon settlement of the
exchange offer, which is expected to occur on June 12, 2020 (the "Settlement Date").
As a result of the exchange offer, the outstanding principal
amount of the Partnership's unsecured notes has been reduced from
$296 million to $81 million. The Partnership's new maturity
schedule for its senior notes following the exchange offer is as
follows:
Debt Maturity
Schedule Following Exchange Offer
|
(dollars in
millions)
|
Principal
|
Maturity
Date
|
Coupon
|
Annual Cash
Interest Expense
|
|
First Lien
Notes(a)
|
$
400.0
|
April 2025
|
7.50%
|
$
30.0
|
|
Second Lien
Notes(b)
|
$
155.5
|
June 2026
|
7.25% +
3.50%
|
$
11.3
|
|
Unsecured
Notes
|
$
80.7
|
August
2022
|
7.25%
|
$
5.9
|
|
Total
|
$
636.2
|
|
|
$
47.2
|
|
(a)
|
Includes the new
first lien notes issued in the exchange offer and $350 million of
first lien notes due 2025 issued in March 2018.
|
(b)
|
At the Partnership's
election, the coupon is 10.0% in cash or 7.25% in cash plus 3.50%
in kind. Interest expense of $11.3 million assumes the interest is
paid in kind, increasing the principal amount
outstanding.
|
Prior to the exchange offer, the Partnership's maturity schedule
for its senior notes was as follows:
Debt Maturity
Schedule Prior to Exchange Offer
|
(dollars in
millions)
|
Principal
|
Maturity
Date
|
Coupon
|
Annual Cash
Interest Expense
|
First Lien
Notes
|
$
350.0
|
April 2025
|
7.50%
|
$
26.3
|
Unsecured
Notes
|
$
295.9
|
August
2022
|
7.25%
|
$
21.5
|
Total
|
$
645.9
|
|
|
$
47.8
|
Eligible holders who validly tendered their unsecured
notes will receive $900 in principal
amount of new first lien notes or, as applicable and subject to
proration described below, $975 in
principal amount of new second lien notes for each $1,000 principal amount of unsecured notes
tendered. Participating eligible holders will also receive accrued
and unpaid interest in cash on unsecured notes accepted for
exchange from the last interest payment date up to, but not
including, the Settlement Date.
The new notes to be issued in the exchange offer will
consist of $50.0 million principal
amount of new first lien notes and $155.5 million of new second lien notes. The
amount of new first lien notes issued to each tendering eligible
holder will be determined based on the amount of unsecured notes
tendered by such eligible holder times a proration factor of 25.8%.
The portion of tendered unsecured notes that are not exchanged into
new first lien notes as a result of any such proration will be
exchanged for new second lien notes.
The exchange offer is subject to certain conditions, which
are expected to be satisfied on or prior to the Settlement
Date.
The new notes were offered in reliance on exemptions from
registration under the Securities Act of 1933, as amended. The new
notes have not be registered under the Securities Act, or any other
applicable securities laws and, unless so registered, the new notes
may not be offered, sold, pledged or otherwise transferred within
the United States or to or for the
account of any U.S. person, except pursuant to an exemption from
the registration requirements thereof. This press release is for
informational purposes only and is neither an offer to purchase nor
a solicitation of an offer to sell the new notes.
Cautionary Note Regarding Forward-Looking Statements
Certain information included in this press release contains
statements that are forward-looking. The words "believe," "may,"
"will," "aim," "estimate," "continue," "anticipate," "intend,"
"plan," "expect," "should" and similar expressions are intended to
identify forward-looking statements. We have based these
forward-looking statements largely on our current expectations and
projections about future events and financial trends that we
believe may affect our financial condition, results of operations,
business strategy, short term and long-term business operations and
objectives, and financial needs. Factors that could cause such
differences in future results include, but are not limited to, the
risks described in the Confidential Offering Memorandum and Consent
Solicitation Statement dated April 17,
2020, as amended and supplemented as of the date hereof,
related to the exchange offer and consent solicitation.
About CSI Compressco LP
CSI Compressco is a provider of compression services and
equipment for natural gas and oil production, gathering, artificial
lift, transmission, processing, and storage. CSI Compressco's
compression and related services business includes a fleet of more
than 5,200 compressor packages providing approximately 1.19 million
in aggregate horsepower, utilizing a full spectrum of low-, medium-
and high-horsepower engines. CSI Compressco also provides
well monitoring and automated sand separation services in
conjunction with compression and related services in certain Latin
American markets. CSI Compressco's aftermarket business provides
compressor package reconfiguration and maintenance services, as
well as the sale of compressor package parts and components
manufactured by third-party suppliers. CSI Compressco's customers
comprise a broad base of natural gas and oil exploration and
production, midstream, transmission, and storage companies
operating throughout many of the onshore producing regions of
the United States, as well as in a
number of foreign countries, including Mexico, Canada and Argentina. CSI Compressco is managed by CSI
Compressco GP Inc., which is an indirect, wholly owned subsidiary
of TETRA Technologies, Inc. (NYSE: TTI).
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SOURCE CSI Compressco LP