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Spin-off Transaction | 9 Months Ended
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Sep. 30, 2015
Debt Disclosure [Abstract] |
Spin-off Transaction | 2. Spin-off Transaction On November 17, 2014, we announced that our board of directors had authorized management to pursue a plan to separate our international contract operations, international aftermarket services and global fabrication businesses into an independent, publicly traded company. On November 3, 2015, we completed the Spin-off of Exterran Corporation. To effect the Spin-off, we distributed on the Distribution Date, on a pro rata basis, all of the shares of Exterran Corporation common stock to our stockholders as of the Record Date. Exterran Holdings shareholders received one share of Exterran Corporation common stock for every two shares of our common stock held at the close of business on the Record Date. Upon completion of the Spin-off, we and Exterran Corporation are independent, publicly traded companies with separate public ownership, boards of directors and management, and we continue to own and operate the U.S. contract operations and U.S. aftermarket services businesses that we previously owned. Effective on November 3, 2015, we were renamed Archrock, Inc. and beginning on November 4, 2015 we trade on the New York Stock exchange under the symbol “AROC.” In addition, we continue to hold interests in the Partnership, which include the sole general partner interest and certain limited partner interests, as well as all of the incentive distribution rights in the Partnership. Effective on November 3, 2015, the Partnership was renamed Archrock Partners, L.P. and trades on the Nasdaq Global Select Market under the symbol “APLP.” On July 10, 2015, we and our wholly owned subsidiary, Archrock Services, L.P. (the “Archrock Borrower”), entered into a credit agreement (the “Archrock Credit Agreement”) with Wells Fargo Bank, National Association (“Wells Fargo”), as the administrative agent, and various financial institutions as lenders, which provided for a $300.0 million revolving credit facility (the “Archrock Credit Facility”) to be made available to the Archrock Borrower. On October 5, 2015, the parties amended the terms of the Archrock Credit Facility to increase the borrowing capacity from $300.0 million to $350.0 million. Availability under the Archrock Credit Facility was subject to the satisfaction of certain conditions precedent, including (i) the payoff and termination of our existing Credit Facility and (ii) the consummation of the Spin-off on or before January 4, 2016 (the date on which those conditions are satisfied is referred to as the “Archrock Initial Availability Date”). No borrowings were outstanding under the Archrock Credit Facility as of September 30, 2015 because the Archrock Initial Availability Date had not yet occurred. As a result of the completion of the Spin-off, the Archrock Initial Availability Date was November 3, 2015. On July 10, 2015, our wholly owned subsidiary Exterran Energy Solutions, L.P. (“EESLP”), which upon the completion of the Spin-off is a wholly owned subsidiary of Exterran Corporation, and Exterran Corporation entered into a $750.0 million credit agreement (the “Exterran Corporation Credit Agreement”) with Wells Fargo, as the administrative agent, and various financial institutions as lenders. On October 5, 2015, the parties amended and restated the terms of the Exterran Corporation Credit Agreement to provide for a new $925.0 million credit facility, consisting of a $680.0 million revolving credit facility and a $245.0 million term loan facility (collectively, the “Exterran Corporation Credit Facility”). Availability under the Exterran Corporation Credit Facility was subject to the satisfaction of certain conditions precedent, including the consummation of the Spin-off on or before January 4, 2016 (the date on which those conditions are satisfied is referred to as the “Initial Availability Date”). No borrowings were outstanding under the Exterran Corporation Credit Facility as of September 30, 2015 because the Initial Availability Date had not yet occurred. As a result of the completion of the Spin-off, the Initial Availability Date was November 3, 2015. As contemplated in the separation and distribution agreement, EESLP will contribute to a subsidiary of Archrock the right to receive payments based on a notional amount corresponding to payments received by subsidiaries of Exterran Corporation from PDVSA Gas in respect of the sale of our previously nationalized assets promptly after such amounts are collected by subsidiaries of Exterran Corporation until Archrock's subsidiary has received an aggregate amount of such payments equal to the lesser of (x) $150.0 million, less the aggregate amount of installment payments received from PDVSA Gas by Exterran Holdings and its subsidiaries after August 31, 2015 but before November 3, 2015, plus the aggregate amount of all reimbursable expenses incurred by Archrock and its subsidiaries in connection with recovering any default installment payments directly from PDVSA Gas following the completion of the Spin-off or (y) $150.0 million. As contemplated in the separation and distribution agreement, EESLP (in the case of debt offerings) or Exterran Corporation (in the case of equity issuances) will use its commercially reasonable efforts to complete one or more unsecured debt offerings or equity issuances resulting in aggregate gross cash proceeds of at least $250.0 million on the terms described in the Exterran Corporation Credit Agreement (such transaction, a “qualified capital raise”) on or before the maturity date of Exterran Corporation’s $245.0 million term loan facility, which is currently expected to be the second anniversary of the completion of the Spin-off or as soon as practicable thereafter. In addition, EESLP will contribute to a subsidiary of Archrock the right to receive, promptly following the occurrence of a qualified capital raise, a $25.0 million cash payment.

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