Oil States International cuts revolver, increases interest rates

By Marisa Wong

Morgantown, W.Va., Dec. 13 – Oil States International, Inc. entered into a second amendment on Dec. 12 to its credit agreement dated May 28, 2014 with Wells Fargo Bank, NA as administrative agent to decrease commitments and increase pricing, according to an 8-K filing with the Securities and Exchange Commission.

Specifically, the amendment reduces the revolving loan commitments to $425 million from $600 million.

The interest rate margins were increased so that when the company’s usage of the facility is less than or equal to 50%, the interest rates for the revolving loans will range from Libor plus 175 basis points to 300 bps, based on a leverage ratio-based grid; and when usage is in excess of 50%, (a) prior to May 28, the highest two levels of the leverage-based grid will be increased by 50 bps so that interest will range from Libor plus 175 bps to 350 bps, based on a leverage, and (b) on or after May 28, the highest two levels of the leverage-based grid will be increased by 150 bps so that interest will range from Libor plus 175 bps to 450 bps, based on leverage.

The amendment also removes the ability to increase the revolving commitments under the accordion feature of the credit agreement.

In addition to changes to restrictive covenants and other changes, the amendment temporarily increases the maximum permitted level of the total leverage covenant to 3.75 times from 3.25 times for the quarters ending March 31 and June 30, 2018.

Oil States is a diversified oilfield services company based in Houston.

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