Amends Revolving Credit, Debt-Obligations & Operating Leases
K-Sea Transportation Partners L.P. Amends Revolving Credit Agreement, Other Debt Obligations and Operating Leases
Friday , January 22, 2010 14:17ET
NEW YORK--(BUSINESS WIRE)-- K-Sea Transportation Partners L.P. (NYSE:KSP) (the "Partnership") announced today that K-Sea Operating Partnership L.P., a wholly owned subsidiary of the Partnership, has entered into an amendment (the "Amendment") to its revolving credit agreement (the "Revolving Credit Agreement") and modified or obtained consents under other debt obligations and operating leases in a manner consistent with the Amendment.
The Amendment reduces the lenders' commitments from $200 million to $175 million (subject to a maximum borrowing base equal to 75% of the orderly liquidation value of the vessel collateral); eliminates the feature of the Revolving Credit Agreement whereby the borrower could request an increase in the total commitments by up to $50 million; increases the interest rate margins by 205 to 275 basis points tied to certain financial ratios; reduces the fixed charge coverage ratio to 1.50 from 1.85, effective March 31, 2010; increases the required ratio of total debt to EBITDA from 3.75 to 1.00 to 4.50 to 1.00, effective immediately, to 5.00 to 1.00 at March 31, 2010 and stepping back down to 4.50 to 1.00 at September 30, 2010 and thereafter; changes the covenant requiring minimum asset coverage to total debt of 1.333 times orderly liquidation value, as compared to the previous requirement of 1.25 times fair market value; allows the Partnership to pay quarterly distributions up to a maximum of $0.45 per unit, so long as the Partnership maintains a minimum liquidity of $17.5 million; and changes the maturity of the facility to July 1, 2012 from August 14, 2014.
The operating partnership also amended a secured term loan facility to conform to the terms of the Revolving Credit Agreement, and amended another term loan facility and an operating lease agreement. The Partnership's Current Report on Form 8-K that was filed today with the Securities and Exchange Commission contains a summary of the Amendment.
President and CEO Timothy J. Casey said, "We are pleased that we and our lenders have reached these agreements in an efficient and effective manner. As recently announced, we are holding our quarterly conference call on January 28th at 8:30 a.m. Eastern time (Dial-in # 866-761-0749, Participant Passcode # 49048499) and invite investors to participate."
About K-Sea Transportation Partners
K-Sea Transportation Partners is one of the largest coastwise tank barge operators in the United States. The Partnership provides refined petroleum products transportation, distribution and logistics services in the U.S. domestic marine transportation market, and its common units trade on the New York Stock Exchange under the symbol KSP. For additional information, please visit the Partnership's website, including the Investor Relations section, at www.k-sea.com.
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