Cloud Peak Energy Announces Its Election to Terminate Its Undrawn Credit Agreement
November 13 2018 - 4:15PM
Business Wire
Cloud Peak Energy Inc. (NYSE:CLD), one of the largest U.S. coal
producers and the only pure-play Powder River Basin (“PRB”) coal
company, today announced that Cloud Peak Energy Resources LLC (“CPE
Resources”), a wholly owned subsidiary of Cloud Peak Energy Inc.,
provided PNC Bank, National Association with notice to terminate
the Credit Agreement with PNC Bank, National Association, as
administrative agent, and a syndicate of lenders, originally dated
as of February 21, 2014 (as amended, the “Credit Agreement”). The
termination of the Credit Agreement is effective as of November 15,
2018.
As disclosed in the Company’s Quarterly Report on Form 10-Q for
the period ending September 30, 2018, the Company has been
evaluating potential alternatives with respect to its Credit
Agreement to achieve the Company’s business objectives and
priorities, including exercising the Company’s right to terminate
the Credit Agreement. As of September 30, 2018, the Credit
Agreement availability was reduced to $16.2 million of borrowing
capacity based upon the quarterly financial covenant
calculations.
As of September 30, 2018, the Company had $109.5 million in cash
and cash equivalents. The Company has no outstanding borrowings or
undrawn letters of credit under the Credit Agreement, the Company
has not historically used the Credit Agreement as a source of
working capital and the Company had no current plans to draw on the
Credit Agreement. The Credit Agreement would have also required CPE
Resources to pay over $3.0 million in additional commitment and
administrative fees during the remaining term of the Credit
Agreement through May 2021, which will now be avoided.
The termination of the Credit Agreement does not result in a
default under CPE Resources’ Accounts Receivable Securitization
Program (the “A/R Securitization Program”) or the indentures for
CPE Resources’ 12.00% second lien senior notes due 2021 or 6.375%
senior notes due 2024. As a result of the termination of the Credit
Agreement, the Company will record a non-cash write off of certain
deferred financing costs in the amount of approximately $4.1
million.
About Cloud Peak Energy®
Cloud Peak Energy Inc. (NYSE:CLD) is headquartered in Wyoming
and is one of the largest U.S. coal producers and the only
pure-play Powder River Basin coal company. As one of the safest
coal producers in the nation, Cloud Peak Energy mines low sulfur,
subbituminous coal and provides logistics supply services. The
Company owns and operates three surface coal mines in the PRB, the
lowest cost major coal producing region in the nation. The Antelope
and Cordero Rojo mines are located in Wyoming and the Spring Creek
Mine is located in Montana. In 2017, Cloud Peak Energy sold
approximately 58 million tons from its three mines to customers
located throughout the U.S. and around the world. Cloud Peak Energy
also owns rights to substantial undeveloped coal and complementary
surface assets in the Northern PRB, further building the Company’s
long-term position to serve Asian export and domestic customers.
With approximately 1,300 total employees, the Company is widely
recognized for its exemplary performance in its safety and
environmental programs. Cloud Peak Energy is a sustainable fuel
supplier for approximately two percent of the nation’s
electricity.
Cautionary Note Regarding Forward-Looking Statements
This release contains “forward-looking statements” within the
meaning of the safe harbor provisions of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Forward-looking statements are not statements of
historical facts and often contain words such as “may,” “will,”
“expect,” “believe,” “anticipate,” “plan,” “estimate,” “seek,”
“could,” “should,” “intend,” “potential,” or words of similar
meaning. Forward-looking statements are based on management’s
current expectations, beliefs, assumptions and estimates regarding
our company, industry, economic conditions, government regulations
and energy policies and other factors. Forward-looking statements
may include, for example, statements regarding the potential impact
of our termination of our Credit Agreement, future available
liquidity and other statements regarding our plans, strategies,
prospects and expectations concerning our business, operating
results, financial condition, liquidity and other matters that do
not relate strictly to historical facts. These statements are
subject to significant risks, uncertainties, and assumptions that
are difficult to predict and could cause actual results to differ
materially and adversely from those expressed or implied in the
forward-looking statements, including our actual future available
liquidity, the timing and extent of any sustained recovery of
currently depressed coal industry conditions and the impact of
ongoing or further depressed industry conditions on our company and
other risk factors and cautionary language described from time to
time in the reports and registration statements we file with the
Securities and Exchange Commission, including those in Item 1A -
Risk Factors in our most recent Form 10-K and any updates thereto
in our Forms 10-Q and current reports on Form 8-K. Additional
factors, events, or uncertainties that may emerge from time to
time, or those that we currently deem to be immaterial, could cause
our actual results to differ, and it is not possible for us to
predict all of them. We make forward-looking statements based on
currently available information, and we assume no obligation to,
and expressly disclaim any obligation to, update or revise publicly
any forward-looking statements made in this release, whether as a
result of new information, future events or otherwise, except as
required by law.
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Cloud Peak Energy Inc.John Stranak, 720-566-2932Investor
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