Basic Energy amends loan, increasing letter-of-credit subfacility

By Sara Rosenberg

New York, April 3 - Basic Energy Services Inc. amended its credit facility, increasing the letter-of-credit subfacility under the revolver to $30 million from $20 million, according to an 8-K filed with the Securities and Exchange Commission Monday.

In addition, the amendments removed the covenant requiring interest rate protection if all of the term loan is discharged or paid.

Furthermore, under the amendment, the covenant limiting payments on earn-out obligations was removed, the amount of deposits permitted in connection with certain liens in the ordinary course of business was increased to $10 million, the covenant prohibiting the incurrence of lease obligations in excess of $5 million was removed and the payment of dividends was limited to the lesser of $10 million or 50% of consolidated net income minus the aggregate amount of all other dividends paid after the effective date of the credit agreement.

The amendment was completed on March 28.

UBS is the administrative agent on the deal.

Basic Energy is a Midland, Texas-based provider of well site services to oil and gas drilling and producing companies.

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