Long-Term Debt | 3 Months Ended |
Apr. 30, 2014 |
Long-Term Debt [Abstract] | ' |
Long-term Debt | ' |
8. LONG-TERM DEBT |
As of the dates indicated in the table below, the Company’s debt consisted of the following: |
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(in thousands) | | 30-Apr-14 | | 31-Jan-14 |
TUSA credit facility | | $ | 238,000 | | $ | 183,000 |
RockPile credit facility | | | 44,616 | | | 21,515 |
5% Convertible Note | | | 130,907 | | | 129,290 |
RockPile notes and mortgages payable | | | 9,314 | | | 9,403 |
Total debt | | | 422,837 | | | 343,208 |
Less current portion of debt: | | | | | | |
RockPile credit facility | | | - | | | -8,450 |
RockPile notes and mortgages payable | | | -406 | | | -401 |
Total long-term debt | | $ | 422,431 | | $ | 334,357 |
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TUSA Credit Facility |
On January 13, 2014, TUSA entered into Amendment No. 3 to the Amended and Restated Credit Agreement and Master Assignment ("Amendment No. 3") with Wells Fargo Bank, National Association (“Wells Fargo”), as administrative agent and issuing lender, and the other lenders named therein, as lenders. Amendment No. 3 amended that certain Amended and Restated Credit Agreement (the "A&R Credit Agreement"), dated April 11, 2013, as amended by that certain Amendment No. 1 to Amended and Restated Credit Agreement and Master Assignment, dated July 30, 2013, and that certain Amendment No. 2 to Amendment and Restated Master Assignment, dated October 16, 2013, to (i) broaden the definition of "Independent Engineering Report" to include a report prepared by or under the supervision of TUSA's engineers if certain requirements are satisfied, and (ii) increase the borrowing base under the TUSA Credit Facility from $275.0 million to $320.0 million. The amendments in Amendment No. 1 remaining in force were (i) provisions permitting TUSA to hedge up to 85.0% of the anticipated production of (x) oil, (y) gas, and (z) natural gas liquid volumes, respectively, attributable to TUSA's total proved reserves, and (ii) revisions enabling TUSA to enter into a second lien credit facility at a future date. The amendments in Amendment No. 2 remaining in force were (i) the addition of three new lenders under the facility, (ii) the extension of the maturity date to October 16, 2018, and (iii) the decrease of the applicable margins for ABR and Eurodollar advances by 0.25% at all utilization levels. Further, the existing lenders assigned a portion of their lending commitments to the three new lenders. As of April 30, 2014, TUSA, as borrower, had borrowings of $238.0 million outstanding under the A&R Credit Agreement, as amended by Amendment No. 3 (the “TUSA Credit Facility”). |
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The borrowing base under the TUSA Credit Facility is subject to redetermination by the beginning of November 2014 and thereafter on a semi-annual basis by the beginning of each May and November. In addition, TUSA has the option to request two additional redeterminations during any calendar year. In May 2014, the borrowing base was increased to $355.0 million (see Note 18 – Subsequent Events). |
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Borrowings under the TUSA Credit Facility bear interest, at TUSA’s option, at either (i) the ABR (the highest of (A) the administrative agent’s prime rate, (B) the federal funds rate plus 0.5%, or (C) the one-month Eurodollar rate (as defined in the Credit Agreement) plus 1%,), plus an applicable margin that ranges between 0.50% and 1.50%, depending on TUSA’s utilization percentage of the then effective borrowing base, or (ii) the Eurodollar rate plus an applicable margin that ranges between 1.50% and 2.50%, depending on TUSA’s utilization percentage of the then effective borrowing base. TUSA may prepay borrowings under the TUSA Credit Facility at any time without premium or penalty (other than customary LIBOR breakage costs), subject to certain notice requirements. All borrowings under the TUSA Credit Facility mature on October 16, 2018. |
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TUSA will pay a per annum fee on all letters of credit issued under the TUSA Credit Facility, which fee will equal the applicable margin for loans accruing interest based on the Eurodollar rate and a fronting fee to the issuing lender equal to 0.125% of the letter of credit amount. TUSA will pay a commitment fee that ranges between 0.375% and 0.50% per annum on the unused availability under the TUSA Credit Facility, depending on TUSA’s utilization percentage of the then effective borrowing base. |
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The TUSA Credit Facility contains representations, warranties and covenants that are customary for similar credit arrangements, including, among other things, covenants relating to (i) financial reporting and notification, (ii) payment of obligations, (iii) compliance with applicable laws, and (iv) notification of certain events. The TUSA Credit Facility also contains various covenants and restrictive provisions which may, among other things, limit TUSA's ability to sell assets, incur additional indebtedness, make investments or loans, and create liens. |
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The TUSA Credit Facility contains financial covenants requiring TUSA to comply with the following: (i) TUSA must maintain a ratio of consolidated current assets to consolidated current liabilities (as those terms are defined in the TUSA Credit Facility) of at least 1.0 to 1.0; and (ii) the ratio of TUSA's consolidated debt to consolidated EBITDAX (as those terms are defined in the TUSA Credit Facility and determined as of the end of each fiscal quarter for the then most-recently ended four fiscal quarters) may not be greater than 4.0 to 1.0. As of April 30, 2014, TUSA was in compliance with all financial covenants under the TUSA Credit Facility. |
Convertible Note |
On July 31, 2012, the Company sold to NGP Triangle Holdings, LLC a $120.0 million Convertible Note (the “Convertible Note”) that became convertible after November 16, 2012 into the Company’s common stock at a conversion rate of one share per $8.00 of note principal (see Note 13 – Long-Term Debt in our audited financial statements included in our Fiscal 2014 Form 10-K). |
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The Convertible Note accrues interest at a rate of 5.0% per annum, compounded quarterly, on each December 31, March 31, June 30 and September 30, and on the date of any redemption, conversion or exchange of the Convertible Note. Such interest is paid-in-kind by adding to the principal balance of the Convertible Note, provided that, after July 31, 2017, the Company has the option to make such interest payments in cash. As of April 30, 2014, $10.9 million of accrued interest has been added to the principal balance of the Convertible Note. |
RockPile Credit Facility |
On March 25, 2014, RockPile entered into a Credit Agreement (the "FY2015 RockPile Credit Agreement") by and among RockPile, as borrower, Citibank, N.A. ("Citi"), as administrative agent and collateral agent, Wells Fargo Bank, National Association ("Wells Fargo"), as joint lead arranger and joint book runner with Citi, and the other lenders party thereto. The FY2015 RockPile Credit Agreement is a $100.0 million senior secured revolving credit facility with an accordion feature that allows for the expansion of the facility up to an aggregate of $150.0 million. |
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Borrowings under the FY2015 RockPile Credit Agreement bear interest, at RockPile's option, at either (i) the alternative base rate (the highest of (a) the administrative agent's prime rate, (b) the federal funds rate plus 0.5%, or (c) the one-month adjusted Eurodollar rate (as defined in the FY2015 RockPile Credit Agreement) plus 1.0%), plus an applicable margin that ranges between 1.5% and 2.25%, depending on RockPile's leverage ratio as of the last day of RockPile's most recent fiscal quarter, or (ii) the Eurodollar rate plus an applicable margin that ranges between 2.50% and 3.25%, depending on RockPile's leverage ratio as of the last day of RockPile's most recent fiscal quarter. RockPile may prepay borrowings under the FY2015 RockPile Credit Agreement at any time without premium or penalty (other than customary LIBOR breakage costs), subject to certain notice requirements. All borrowings under the FY2015 RockPile Credit Agreement mature on March 25, 2019. |
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RockPile will pay a commitment fee that ranges between 0.375% and 0.50% per annum on the unused availability under the FY2015 RockPile Credit Agreement. RockPile will also pay a per annum fee on all letters of credit issued under the FY2015 RockPile Credit Agreement, which will equal the applicable margin for loans accruing interest based on the Eurodollar rate and a fronting fee to the issuing lender equal to 0.125% of the letter of credit amount. In connection with entering into the FY2015 RockPile Credit Agreement, RockPile paid certain upfront fees to the lenders thereunder, and RockPile paid certain arrangement and other fees to Citi and Wells Fargo. Triangle is not a guarantor under the FY2015 RockPile Credit Agreement. Upon entering into the FY2015 RockPile Credit Agreement, funds were drawn to pay off all outstanding borrowings under RockPile’s then outstanding Credit Agreement with Wells Fargo, and for working capital. As of April 30, 2014, the interest rate on the loan was 5.0% and $44.6 million was outstanding on the loan. |
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The RockPile Credit Facility contains financial covenants requiring RockPile to comply with the following: (i) the ratio of RockPile’s consolidated debt to EBITDA (as defined in the FY2015 RockPile Credit Facility) may not be greater than 2.75 to 1.00 (determined as of the end of each fiscal quarter for the then most-recently ended four fiscal quarters) and; (ii) RockPile must maintain a ratio of Adjusted EBITDA to Fixed Charges (as defined in the FY2015 RockPile Credit Facility) of at least 1.25 to 1.00 quarterly. As of April 30, 2014, RockPile was in compliance with all financial covenants under the FY2015 RockPile Credit Facility. |
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RockPile Mortgages Payable to Dacotah Bank |
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Bakken Real Estate Development, LLC, a wholly-owned subsidiary of RockPile, has two mortgage loan agreements with Dacotah Bank in the amounts of $2.5 million, for its residential units, and $4.4 million, for its administrative and maintenance facility, all located in Dickinson, North Dakota. The mortgage loans have a term of 15 years, bear interest at a variable rate equal to the Federal Home Loan Bank of Des Moines Five-Year Fixed-Rate Advance Rate plus 2.80%, and have a maturity date of |
December 15, 2028. |
RockPile Notes Payable to Sellers of Team Well Service, Inc. |
On October 16, 2013, RockPile issued two identical unsecured subordinated promissory notes to the sellers of Team Well Service Inc. (“Team Well”) in connection with its acquisition of Team Well. The notes each have a face value of $0.5 million and bear interest at a fixed rate of 1.0%. The loans have a maturity date of October 16, 2016, at which time the principal and accrued interest is due and payable. The aggregate carrying value of the loans at April 30, 2014 was $0.9 million. Over the term of the loans, the discount will be accreted on a monthly basis by increasing the carrying value of both notes and recording interest expense. |
RockPile Hauck Apartments Mortgage |
On November 20, 2013, RockPile closed on the purchase of a 12 unit apartment building in Dickinson, ND for a total purchase price of $1.8 million. The purchase was funded by cash on hand and a mortgage from Dacotah Bank in the amount of $1.5 million. The mortgage has a term of 15 years and bears interest at a variable rate equal to the Federal Home Loan Bank of Des Moines Five-Year Fixed-Rate Advance Rate plus 2.70%. At April 30, 2014, the interest on the mortgage was 4.75% and the outstanding balance on the mortgage was $1.5 million. |
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