OCI Beaumont amends term loan agreement, enters intercompany facilities

By Tali Rackner

Norfolk, Va., Dec. 1 – OCI Beaumont LLC, OCI Partners LP and OCI USA Inc. entered into a seventh amendment to their term loan credit agreement dated Aug. 20, 2013, according to an 8-K filing with the Securities and Exchange Commission.

The amendment increased the maximum consolidated senior secured net leverage ratio covenant to 6.25 times from 5 times for the quarter ending March 31, 2017 to 5.5 times from 1.75 for the quarters ending June 30, 2017 and Sept. 30, 2017, to 5.25 times from 1.75 times for the quarter ending Dec. 31, 2017 and to 4.75 times from 1.75 times for the quarter ending March 31, 2018 and for each fiscal quarter ending thereafter.

In addition, the minimum consolidated interest coverage ratio covenant was decreased to 1.25 times from 2.5 times for the quarters ending Dec. 31, 2016 and March 31, 2017, to 1.5 times from 5 times for the quarter ending June 30, 2017 to 1.75 times from 5 times for the quarter ending Sept. 30, 2017 and to 2.25 times from 5 times for the quarter ending Dec. 31, 2017 and for each fiscal quarter ending thereafter.

The calculation of the interest coverage ratio was also amended by excluding interest recorded on subordinated debt from the calculation.

Furthermore, OCI Beaumont agreed to prepay $200 million of term loans under the term loan B credit facility with the proceeds from a borrowing under a new intercompany term facility, and the lenders consenting to the amendment agreed to waive the 2% premium otherwise applicable to such prepayment.

Intercompany term facility

On Sept. 15, OCI Beaumont entered into an intercompany term facility agreement with OCI USA to replace the intercompany loan agreement with OCI Fertilizer International BV. The intercompany term facility agreement was amended and restated on Wednesday to provide for the option by OCI Beaumont to pay PIK Interest.

The facility became effective on Nov. 30 and has a borrowing capacity of $200 million and a maturity date of Jan. 20, 2020.

Bank of America, NA is the administrative agent.

Borrowings are subordinated to the term B-3 loans under the term loan B credit facility and the revolving credit agreement dated April 4, 2014. Interest is equal to the sum of the rate per annum applicable to the term B-3 loans, plus 25 basis points.

Intercompany revolving facility

Also on Sept. 15, OCI Beaumont entered into an intercompany revolving facility agreement with OCI USA to replace the intercompany revolving facility agreement with OCI Fertilizer.

The intercompany revolver became effective on Wednesday, has a borrowing capacity of $40 million and a maturity date of Jan. 20, 2020.

The amount that can be drawn is limited to $40 million minus the amount of debt outstanding under the revolving credit facility.

Borrowings bear interest at a rate equal to the sum of the rate per annum applicable to the revolving credit facility, plus 25 bps.

Nederland, Texas-based OCI owns and operates an integrated methanol and ammonia production facility.

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