CWC Energy Services Corp. Announces Amendments to its Credit Facilities and Additions to Management Team

CALGARY, April 15, 2016 /CNW/ - (TSXV: CWC) CWC Energy Services Corp. ("CWC" or the "Company") is pleased to announce that it has reached an agreement with its banking syndicate to make certain amendments to its credit facilities.  

Credit Facilities Amendment

CWC and its banking syndicate have agreed to amend the credit facilities to provide increased financial flexibility to July 31, 2018. The amendments include, among other things, the following terms:

  • the maturity date of the credit facilities were extended to July 31, 2018;
  • the credit facilities were voluntarily reduced from $75.0 million to $65.0 million with the ability to increase the credit facilities by an additional $60.0 million through an accordion feature, subject to approval by the banking syndicate;
  • the minimum liquidity is reduced from $12.5 million to $10.0 million;
  • the quarterly financial covenant for Consolidated Debt to Consolidated EBITDA ratio are as follows:

For the Quarter Ended

Covenant

June 30, 2016 and September 30, 2016

5.50 : 1

December 31, 2016 and March 31, 2017

5.25 : 1

June 30, 2017

4.75 : 1

September 30, 2017

4.50 : 1

December 31, 2017

4.00 : 1

Thereafter

3.50 : 1

  • an equity cure provision which allows the Company to apply the proceeds of equity offerings in the calculation of Consolidated EBITDA for purposes of its quarterly Consolidated Debt to Consolidated EBITDA ratio until March 31, 2018, subject to certain conditions.

With the amendments to the credit facilities the Company anticipates that it will be in compliance with its financial covenant ratios through the date of maturity.

The Company also anticipates that the resulting increased financial flexibility will allow CWC to focus on its business operations and strategic initiatives through a prolonged industry downturn and demonstrates the continued strong support of its banking syndicate.

Additions to Management Team

CWC is pleased to announce the following additions to its management team:

Mr. Robert Apps recently joined CWC and will be promoted to Vice President, Sales & Marketing (Drilling) effective April 26, 2016.  Mr. Apps has over 25 years of experience in the drilling rig industry having started as a Floorhand and progressively moving up in responsibility to Driller with Ensign Energy Services.  Mr. Apps has been a successful Sales Representative marketing drilling rigs for the past 16 years for Ensign Energy Services, Stoneham Drilling and most recently with Horizon Drilling. 

Mr. Paul Donohue recently joined CWC in the position of General Manager (Drilling).  Mr. Donohue has over 23 years of experience in the drilling rig industry having started as a Floorhand and progressively moving up in responsibility to Rig Manager with Nabors Drilling. He continued his ascent in the drilling industry filling roles of Field Superintendent, Operations Manager and General Manager, Operations with Horizon Drilling.

"CWC is very fortunate to have two well respected, experienced drilling professionals join our management team. I look forward to working with Bob and Paul as we continue to make CWC Ironhand Drilling the drilling contractor of choice for our customers," said Duncan Au, President & Chief Executive Officer.  

About CWC Energy Services Corp.

CWC Energy Services Corp. is a premier contract drilling and well servicing company operating in the Western Canadian Sedimentary Basin with a complementary suite of oilfield services including drilling rigs, service rigs, and coil tubing. The Company's corporate office is located in Calgary, Alberta, with operational locations in Nisku, Grande Prairie, Slave Lake, Red Deer, Drayton Valley, Lloydminster, Provost, and Brooks, Alberta. The Company's shares trade on the TSX Venture Exchange under the symbol "CWC".

READER ADVISORY - Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release contains certain forward-looking information and statements within the meaning of applicable Canadian securities legislation.  Certain statements contained in this news release may contain such words as "anticipate", "could", "continue", "should", "seek", "may", "intend", "likely", "plan", "estimate", "believe", "expect", "will", "objective", "ongoing", "project" and similar expressions are intended to identify forward-looking information or statements. In particular, this news release contains forward-looking statements including management's assessment of the future compliance with financial covenant ratios, the benefits to be derived from the anticipated increased financial flexibility resulting from the credit facility amendments and expectations regarding the business, operations and revenue of the Company in addition to general economic conditions. Although the Company believes that the expectations and assumptions on which such forward-looking information and statements are based are reasonable, undue reliance should not be placed on the forward-looking information and statements because the Company can give no assurances that they will prove to be correct. Since forward-looking information and statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the drilling and oilfield services sector (ie. demand, pricing and terms for oilfield drilling and services; current and expected oil and gas prices; exploration and development costs and delays; reserves discovery and decline rates; pipeline and transportation capacity; weather, health, safety and environmental risks), integration of acquisitions, competition, and uncertainties resulting from potential delays or changes in plans with respect to acquisitions, development projects or capital expenditures and changes in legislation, including but not limited to tax laws, royalties and environmental regulations, stock market volatility and the inability to access sufficient capital from external and internal sources.  Accordingly, readers should not place undue reliance on the forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect the Company's financial results are included in reports on file with applicable securities regulatory authorities and may be accessed through SEDAR at www.sedar.com. The forward-looking information and statements contained in this news release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking information or statements, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. Any forward-looking statements made previously may be inaccurate now.

SOURCE CWC Energy Services Corp.

For further information: CWC Energy Services Corp., 610, 205 - 5th Avenue SW, Calgary, Alberta T2P 2V7, Telephone: (403) 264-2177, Email: info@cwcenergyservices.com; Duncan T. Au, CPA, CA, CFA, President & Chief Executive Officer; Craig Flint, CPA, CA, Chief Financial Officer

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www.cwcenergyservices.com

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