KNOT Offshore units update term loans’ guarantor, financial covenants

By Marisa Wong

Madison, Wis., July 14 – KNOT Offshore Partners LP’s subsidiaries amended and restated their $117 million term loan facility agreement dated July 11, 2011 and $117 million amended and restated term loan facility agreement dated Nov. 3, 2011, according to an 8-K filing with the Securities and Exchange Commission.

Knutsen Shuttle Tankers 14 AS is the borrower under the term loan dated July 11, 2011, and Knutsen Shuttle Tankers 15 AS is the borrower under the term loan dated Nov. 3, 2011.

The subsidiaries requested that the lenders consent to them becoming wholly owned, directly or indirectly, by KNOT Offshore.

The amendments release Knutsen NYK Offshore Tankers AS as parent guarantor. KNOT Offshore and KNOT Shuttle Tankers AS will replace Knutsen NYK Offshore as new guarantors.

The financial covenants under the term loans were also amended.

Under both facilities, the company is required to maintain an equity ratio of at least 0.3 and an interest coverage ratio of at least 2.5 to 1.

The amendments were completed on June 26.

Based in Aberdeen, Scotland, KNOT Offshore is majority owned by Knutsen NYK Offshore, a Haugesund, Norway-based owner and operator of shuttle tankers.

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