CALGARY, AB, June 14, 2021 / CNW / – SECURE Energy Services Inc. (“SECURE”, the “Company”) (TSX: SES) announced today that it has entered into a binding agreement with its syndicate of lenders to increase the size of the Senior revolving guarantee previously announced credit facility available at the close of the business combination with Tervita Corporation (“Tervita”) of $ 725 million at $ 800 million.
On March 8, 2021, SECURE and Tervita entered into an arrangement agreement to combine into an all-equity transaction, thereby creating a stronger midstream infrastructure and environmental solutions business (the “Transaction”). The amalgamated company will operate under the name SECURE and will remain listed on the Toronto Stock Exchange (“TSX”) under the name TSX: SES.
SECURE has entered into commitments with nine financial institutions and chartered banks to provide the Combined Company with financing through a three-year, $ 800 million credit facility (the “Credit Facility”), subject to the satisfaction of certain conditions precedent. The credit facility will be used to replace and repay SECURE’s existing first and second lien credit facilities and Tervita’s first lien credit facility. Tervita’s senior notes will remain in circulation and will optimize the capital structure while maintaining adequate liquidity. The effectiveness of the Credit Facility will itself be subject to compliance with certain financial covenants, liquidity criteria and customary conditions, including completion of the Transaction. It is expected that each of the effective conditions of the Credit Facility, with the exception of the proposed merger of SECURE and Tervita, will be satisfied prior to the completion of the Transaction.
“The increase in the credit facility that will be put in place upon completion of our merger with Tervita provides increased financial flexibility to the combined company,” said Chad Magus, Chief Financial Officer. “We appreciate the support of our lenders and look forward to continuing our relationship.”
As previously stated, SECURE will continue to focus on debt repayment following the close of the Transaction to achieve the combined Company’s target debt / EBITDA ratio of less than 2.5x, which is expected to be achieved within two years of closing. closing of the Transaction.
SECURE is also pleased to announce that it has a firm commitment for a new $ 30 million unsecured letter of credit facility guaranteed by Export Development Canada (the “LC Facility”), providing additional stability and capacity. to the company’s capital structure. SECURE had issued letters of credit in the amount of approximately $ 37 million at March 31, 2021. Any letter of credit issued in excess of the capacity of the LC facility is expected to reduce the amount available to be drawn under the credit facility after completion of the transaction.
Special shareholders’ meeting
At June 15, 2021, SECURE and Tervita will each hold special meetings of shareholders virtually, via live webcasts, with SECURE shareholders and Tervita security holders voting on the respective resolutions relating to the Transaction (the “Meetings”).
Further information on how to participate in General Meetings, as well as voting instructions for shareholders registered at the May 4, 2021, were included in the joint information circular of SECURE and Tervita dated May 6, 2021 (the “Joint Information Circular”) which has been delivered to the relevant securityholders and filed on SEDAR at www.sedar.com at May 11, 2021.
Certain statements contained in this press release constitute “forward-looking statements” and / or “forward-looking information” within the meaning of applicable securities laws (collectively, “forward-looking statements”). When used in this press release, the words “achieve”, “improve”, “wait”, “plan”, “position”, “priority”, “achieve”, “result”, “strategy”, ” target ”and“ will ”, and similar expressions, with respect to SECURE or the Combined Company, or their respective management, are intended to identify forward-looking statements. These statements reflect SECURE’s current views with respect to future events. and operating performance and speak only as of the date of this press release.
In particular, this press release contains or implies forward-looking statements concerning: the satisfaction of the conditions necessary to be fulfilled for the Credit Facility to be concluded and the timetable thereof; the expected terms and conditions of the credit facility and the use of the proceeds thereof; expectations regarding the financial strength and flexibility of the combined company; debt repayment plans; the ability to achieve the combined company’s target debt / EBITDA ratio of less than 2.5x; the stability and financial flexibility of the capital structure of the combined company; and the meetings of each of the shareholders of SECURE and of the security holders of Tervita.
Forward-looking statements involve important known and unknown risks and uncertainties, should not be interpreted as guarantees of future performance or results, and will not necessarily constitute precise indications as to the achievement of such results. Readers are cautioned not to place undue reliance on these statements, as a number of factors could cause actual results to differ materially from the results discussed in such forward-looking statements, including, but not limited to, factors mentioned under the heading “Risk Factors” in our Annual Information Form for the year ended December 31, 2020, and the joint information circular, all of which are available on SEDAR at www.sedar.com.
Although the forward-looking statements contained in this press release are based on what the Company considers to be reasonable assumptions, including that the conditions for entering into the credit facility will be met and the timing thereof, the Company does not can assure investors that the results will be consistent with these forward-looking statements. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement. Unless otherwise required by law, SECURE does not intend, nor assumes any obligation, to update these forward-looking statements.
SECURE is a Toronto Stock Exchange listed energy company that provides cutting edge customer solutions to upstream oil and gas companies operating in the west Canada and some regions of United States through its network of intermediate processing and storage facilities, crude oil and water pipelines and crude oil rail terminals located in all key resource areas in the west Canada, North Dakota and Oklahoma. SECURE’s core infrastructure operations generate cash flow from processing and disposal of oil production, disposal of produced water and storage, logistics and marketing of crude oil . SECURE also provides comprehensive environmental and fluid management for landfill disposal, on-site abandonment, remediation and reclamation, drilling, completion and production operations for oil producers. and western gas Canada.
TSX Symbol: SES
SOURCE SECURE Energy Services inc.
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