Natural Gas Services Group, Inc. Announces Closing of $20 Million Credit Facility with Texas Capital Bank
May 12 2021 - 8:00AM
Natural Gas Services Group, Inc. (NYSE:NGS) (the "Company" or
"NGS"), a leading provider of gas compression equipment and
services to the natural gas and oil industry, today announced the
closing of a new $20 million senior secured revolving credit
facility with Texas Capital Bank, N.A. as lender and administrative
agent. NGS may, subject to certain conditions and limitations,
increase the revolving credit commitments outstanding under the
revolving credit facility in an aggregate principal amount not to
exceed an additional $30 million. Together with its existing cash
position, the facility provides the Company with a solid liquidity
position to meet its working capital needs as well as pursue a wide
variety of strategic, value-creating initiatives.
“With the recent challenges many of our oilfield
peers have experienced in obtaining or renewing credit facilities,
we are extremely pleased with our new credit relationship with
Texas Capital Bank,” said Stephen C. Taylor, Chairman, President
and Chief Executive Officer of Natural Gas Services Group, Inc.
“The cost of our new credit facility is among the lowest in our
industry. In addition, the flexibility of the base facility
combined with the expansion feature provides NGS with ample capital
to meet our internal growth needs as well as explore opportunities
to add value to our core businesses. These favorable terms are
supported by our strong balance sheet and consistent history of
generating cash from operations.”
The obligations under the revolving credit
facility are secured by a first lien on substantially all of the
Company’s assets and are guaranteed by our subsidiaries.
Outstanding loans will bear interest at a sliding scale based on
our leverage ratio from LIBOR plus 1.25% to LIBOR plus 1.75% per
annum. (The Company may also choose to borrow based on Texas
Capital Bank’s “Base Rate” (generally, the prime rate) plus a
margin of 0.25% to 0.75%). Additionally, the facility contains a
fee for the unused revolving credit commitments of 0.25% per annum.
At closing, the Company had no outstanding balance borrowed under
the facility. The facility has an initial term of five years,
maturing in May, 2026.
“The five-year term of the facility also
provides for both stability and flexibility in our capital
structure which affords NGS a competitive advantage into the
future,” added Taylor. “We look forward to our new relationship
with Texas Capital Bank and are especially excited to partner with
a Texas-based bank that continues to be eager to lend to energy
companies, especially those with deep Texas roots.”
Enerecap Partners advised Natural Gas Services
Group in arranging and negotiating the credit facility. Jones &
Keller, LLP served as legal counsel to the Company. A summary of
the credit facility as well as the Credit Agreement and supporting
documents can be found in the Company’s Quarterly Report to be
filed with the U.S. Securities and Exchange Commission on or about
May 14, 2021.
About Natural Gas Services Group, Inc.
(NGS)
NGS is a leading provider of gas compression
equipment and services to the energy industry. The Company
manufactures, fabricates, rents, sells and maintains natural gas
compressors and combustion systems for oil and natural gas
production and plant facilities. NGS is headquartered in Midland,
Texas, with fabrication facilities located in Tulsa, Oklahoma and
Midland, Texas, and service facilities located in major oil and
natural gas producing basins in the U.S. Additional information can
be found at www.ngsgi.com.
Cautionary Note Regarding Forward-Looking
Statements
Except for historical information contained
herein, the statements in this release are forward-looking and made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements
involve known and unknown risks and uncertainties, which may cause
NGS's actual results in future periods to differ materially from
forecasted results. Those risks include, among other
things, the loss of market share through competition or otherwise;
the introduction of competing technologies by other companies; a
prolonged, substantial reduction in oil and gas prices which could
cause a decline in the demand for NGS's products and services; and
new governmental safety, health and environmental regulations and
social initiatives which could require NGS to make significant
capital expenditures or reduce our customers' demand for our
products and services. Any forward-looking statements included in
this press release are only made as of the date of this press
release, and NGS undertakes no obligation to publicly update such
forward-looking statements to reflect subsequent events or
circumstances. A discussion of these factors is included in the
Company's most recent Annual Report on Form 10-K filed with the
Securities and Exchange Commission.
For More
Information, Contact: |
Alicia Dada,
Investor Relations |
|
(432)
262-2700Alicia.Dada@ngsgi.com |
|
www.ngsgi.com |
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