Replies to post #109680 on Savvy Trades and Investments

[2morrowsGains]

AESI...Thanks researcher...I started a position. AESI goes nicely w/ my ACDC/FTK positions. (Restarted a position in ACDC & FTK after taking a beating this year. Fortunately my losses are behind me as they will be used against my gains this year).

[2morrowsGains]

ACDC...ProFrac Holding Corp. Completes Refinancing of Senior Secured Term Loan and Enhances Financial Flexibility

WILLOW PARK, Texas, Dec. 27, 2023 /PRNewswire/ -- ProFrac Holding Corp. (NASDAQ: ACDC) ("ProFrac", or the "Company") today announced that, on December 27, 2023, it completed the refinancing of its existing Senior Secured Term Loan and other debt with two new financings totaling $885 million, which will both mature in 2029. As a result of these transactions, ProFrac is well positioned to deliver exceptional service to its customers and poised to maintain its position as a leader in the oilfield services industry in anticipation of a strong 2024.

Highlights

Refinances the existing Term Loan due March 2025 with a term loan credit facility and senior secured notes with maturities in January 2029
Cash neutral transaction that also positions the Company to maintain liquidity to fund working capital for expected increased activity in 2024
Provides a bifurcated capital structure to allow for future optionality designed to realize the full value potential of the proppant segment
Eliminates any material near-term maturities and provides additional runway to de-lever
Enables ProFrac to focus on the 2024 strategy where it plans to increase utilization of its proppant and stimulation assets through a more diversified commercial approach
First Financial Term Loan and REV Seller Note fully repaid as part of the transaction
ABL Credit Facility amended to lower the line's capacity to $325 million from $400 million
Matt Wilks, ProFrac's Executive Chairman, stated, "We are pleased to announce this successful refinancing, which not only extends our near-term debt maturities into 2029, but it also provides us with the financial flexibility to opportunistically take advantage of the anticipated ramp in activity levels in the coming year. This transaction demonstrates our ability to finance the Company's capital structure and liquidity position in an improving market.

"This is an important and necessary step for ProFrac as we execute the improvements made to the business and demonstrate the cash generation potential in 2024. This is also the next step in the process to build a strong foundation in our proppant segment and maximize shareholder value of that segment."

Transaction Overview

The refinancing transactions include a $365 million Alpine Term Loan and $520 million in Services Senior Secured Notes. These proceeds were used to pay off ProFrac's existing Senior Secured Term Loan, First Financial Term Loan and REV Seller Note as well as for certain fees and expenses. This refinancing transaction provides the Company with a more stable financial platform, a strengthened balance sheet, a bifurcated capital structure and ample liquidity from which it will continue executing various growth-related and value realization opportunities. Additional details on these debt arrangements are as follows:

Alpine Term Loan

These loans were made to ProFrac's family of wholly owned subsidiaries that hold and run ProFrac's proppant business, including Alpine Holding II, LLC ("Alpine Holding") and PF Proppant Holding, LLC ("PFP Holding") among others

Lenders made certain term loans to PFP Holding in the aggregate principal amount of $365.0 million
Guaranteed by ProFrac pursuant to the Unsecured ProFrac Guarantee Agreement and are guaranteed by Alpine Holding, PFP Holding and the Subsidiary Guarantors pursuant to the Alpine Guarantee Agreement
Obligations under the Alpine Term Loan are secured by a lien on and security interest in substantially all of the assets of Alpine Holding, PFP Holding and the Subsidiary Guarantors, which holds ProFrac's Proppant business
The Alpine Term Loan bears a floating interest rate at the borrower's option of either a Base Rate or SOFR Rate plus an applicable margin
Base Rate Loans bear interest at a fluctuating per annum rate equal to the base rate plus a margin of 7.25% per annum subject to both a floor and maximum rate
SOFR Rate Loans bear interest at a fluctuating per annum rate equal to the adjusted term SOFR for a one-month interest period plus a margin of 7.25% per annum subject to both a floor and maximum rate
Mandatory principal payments commence at the end of the calendar quarters ending June 30, 2024, September 30, 2024 and December 31, 2024, in an amount equal to $5 million on each such date followed by quarterly payments of $15 million
The stated maturity date for the Alpine Term Loans is the earlier of January 26, 2029 or the date it becomes due and payable
Services Senior Secured Floating Rate Notes due 2029

ProFrac Holdings II, a wholly-owned subsidiary of ProFrac, issued and sold $520.0 million aggregate principal amount of its Senior Secured Floating Rate Notes due 2029 in a private placement to institutional investors
The Secured Notes bear interest at a fluctuating per annum rate equal to adjusted term SOFR plus the Applicable Margin (as defined in the Indenture) payable quarterly beginning on March 31, 2024
Obligations under the Secured Notes are secured by ProFrac Holdings II, which holds ProFrac's Services business
Mandatory prepayments of $10.0 million on each of June 30, 2024, September 30, 2024 and December 31, 2024, and $15.0 million at the end of each calendar quarter thereafter
On and after January 15, 2025, ProFrac Holdings II may redeem all or a part of the Secured Notes at certain redemption prices outlined in the associated 8-K to this transaction
Seventh Amendment to the ABL Credit Facility

Maximum Revolver Amount is decreased ratably among the Lenders from $400.0 million to $325.0 million
Alpine Holding and its Subsidiaries are designated as Excluded Subsidiaries and Unrestricted Subsidiaries (each as defined therein)
Liens held by the lenders on the assets of the Alpine Excluded Subsidiaries, and all guarantees of the obligations under ABL Credit Facility made by the Alpine Excluded Subsidiaries, are released, terminated and discharged
The ABL Credit Facility has a maturity date of the earlier of March 4, 2027 and 91 days prior to the maturity of any material indebtedness
Advisors

Piper Sandler & Co acted as the sole financial advisor, and Gibson, Dunn & Crutcher LLP and Brown Rudnick LLP acted as legal counsel to ProFrac in connection with the refinancing.

About ProFrac Holding Corp.

ProFrac Holding Corp. is a technology-focused, vertically integrated, innovation-driven energy services holding company providing hydraulic fracturing, proppant production, other completion services and other complementary products and services to leading upstream oil and natural gas companies engaged in the exploration and production ("E&P") of North American unconventional oil and natural gas resources throughout the United States. Founded in 2016, ProFrac was built to be the go-to service provider for E&P companies' most demanding hydraulic fracturing needs. ProFrac is focused on employing new technologies to significantly reduce "greenhouse gas" emissions and increase efficiency in what has historically been an emissions-intensive component of the unconventional E&P development process. ProFrac Corp. operates in three business segments: stimulation services, proppant production and manufacturing. For more information, please visit the ProFrac's website at www.pfholdingscorp.com. Information on ProFrac's website is not part of this release.
https://www.prnewswire.com/news-releases/profrac-holding-corp-completes-refinancing-of-senior-secured-term-loan-and-enhances-financial-flexibility-302022975.html

[2morrowsGains]

AESI...researcher, Phenomenal call on this one back in December. Stock closed @ $21.41 today. Thanks. It's a decent position in my portfolio.