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Cathedral Energy Services Ltd
Symbol CET
Shares Issued 49,468,117
Close 2020-06-29 C$ 0.18
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Cathedral completes amendments to credit facility

2020-06-29 22:59 ET - News Release

Mr. P. Scott MacFarlane reports

CATHEDRAL ENERGY SERVICES ANNOUNCES CREDIT FACILITY AMENDMENTS AND EXTENSION

Cathedral Energy Services Ltd. has confirmed that the amendments to its existing credit facility, which were announced in Cathedral's June 24, 2020, press release are now in force and effective as of June 29, 2020. The amendments to the Facility include the following changes:

  • Maturity is extended to June 30, 2022;
  • Reduction in Facility to $12 million;
  • Consolidated funded debt to consolidated EBITDA (as defined in the Facility) ratio is waived from 2020 Q2 through 2021 Q1 (the "covenant relief period");
  • Consolidated interest coverage ratio is waived during the covenant relief period if funded debt is no more than $6 million;
  • New funded debt to tangible net worth ("TNW") ratio is in place during the covenant relief period. This ratio is to be no more than 10% for 2020 Q2 and 2020 Q3 and no more than 15% in 2020 Q4 and 2021 Q1. TNW is defined as shareholders' equity plus subordinated debt less investments in or amounts owed by any related party which does not constitute subordinated debt;
  • During the covenant relief period, advances under the Facility are limited to $10 million;
  • During the covenant relief period, aggregate capital expenditures (excluding non-cash utilization of existing inventory) for the fiscal year ended December 31, 2020, are not to exceed $2 million;
  • Advances under the Facility will bear interest at the financial institution's prime rate plus 1.75% to 3.25% or bankers' acceptance rate plus 3.00% to 4.25% with interest payable monthly, depending upon the consolidated funded debt to consolidated EBITDA ratio; and
  • The Borrower has a one-time option to exit the covenant relief period.

Under the revised Facility, Alberta Treasury Branches will be the sole lender.

Cathedral Energy Services Ltd. (the "Company" or "Cathedral"), based in Calgary, Alberta is incorporated under the Business Corporations Act (Alberta) and operates in the U.S. under Cathedral Energy Services Inc. The Company is publicly traded on the Toronto Stock Exchange under the symbol "CET". Cathedral, is a trusted partner to North American energy companies requiring high performance directional drilling services. We work in partnership with our customers to tailor our equipment and expertise to meet their specific geographical and technical needs. Our experience, technologies and responsive personnel enable our customers to achieve higher efficiencies and lower project costs.

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