XML 20 R8.htm IDEA: XBRL DOCUMENT
v3.5.0.2

Long-Term Debt and Other Borrowings | 6 Months Ended
--- | ---
Jun. 30, 2016
Notes to Financial Statements [Abstract] |
Long-Term Debt and Other Borrowings | NOTE B – LONG-TERM DEBT AND OTHER BORROWINGS It is important to consider TETRA's capital structure and CCLP's capital structure separately, as we have no cross default provisions, cross collateralization provisions, or cross guarantees with CCLP's debt, nor does CCLP with TETRA's debt. Long-term debt consists of the following:
|  |  | June 30, 2016 |  | December 31, 2015
|  |  | (In Thousands)
TETRA |  | Scheduled Maturity |  |  |
Bank revolving line of credit facility (presented net of the unamortized deferred financing costs of $1.1 million as of June 30, 2016 and $1.3 million as of December 31, 2015) |  | September 30, 2019 | $ | 101,604 |  |  | $ | 21,572 |
5.09% Senior Notes, Series 2010-A (presented net of unamortized deferred financing costs of $0 million as of June 30, 2016 and $0.1 million as of December 31, 2015) |  | December 15, 2017 | — |  |  | 46,809 |
5.67% Senior Notes, Series 2010-B (presented net of unamortized deferred financing costs of $0 million as of June 30, 2016 and $0.1 million as of December 31, 2015) |  | December 15, 2020 | — |  |  | 17,964 |
4.00% Senior Notes, Series 2013 (presented net of unamortized deferred financing costs of $0 million as of June 30, 2016 and $0.2 million as of December 31, 2015) |  | April 29, 2020 | — |  |  | 34,753 |
11.00% Senior Notes, Series 2015 (presented net of the unamortized discount of $4.7 million as of June 30, 2016 and $4.9 million as of December 31, 2015 and net of unamortized deferred financing costs of $2.9 million as of June 30, 2016 and $3.2 million as of December 31, 2015) |  | November 5, 2022 | 117,446 |  |  | 116,837 |
Senior Secured Notes (presented net of unamortized deferred financing costs of $0 million as of June 30, 2016 and $1.4 million as of December 31, 2015) |  | April 1, 2019 | — |  |  | 48,635 |
Other |  |  | — |  |  | 50 |
TETRA total debt |  |  | 219,050 |  |  | 286,620 |
Less current portion |  |  | — |  |  | (50 | )
TETRA total long-term debt |  |  | $ | 219,050 |  |  | $ | 286,570 |
CCLP |  |  |  |  |
CCLP Bank Credit Facility (presented net of the unamortized deferred financing costs of $4.8 million as of June 30, 2016 and $5.4 million as of December 31, 2015) |  | August 4, 2019 | 231,171 |  |  | 229,555 |
CCLP 7.25% Senior Notes (presented net of the unamortized discount of $4.3 million as of June 30, 2016 and $4.5 million as of December 31, 2015 and net of unamortized deferred financing costs of $7.7 million as of June 30, 2016 and $8.4 million as of December 31, 2015) |  | August 15, 2022 | 338,001 |  |  | 337,103 |
CCLP total long-term debt |  |  | 569,172 |  |  | 566,658 |
Consolidated total long-term debt |  |  | $ | 788,222 |  |  | $ | 853,228 |
As a result of the retrospective adoption of ASU 2015-03 during the three months ended March 31, 2016, deferred financing costs of $16.4 million and $20.2 million at June 30, 2016 and December 31, 2015, respectively, were reclassified out of long-term other assets and are netted against the carrying values of the bank credit facilities and Senior Notes of TETRA and CCLP. In addition, $1.0 million and $2.1 million of expense for the amortization of deferred financing costs for the three and six month periods ended June 30, 2016, respectively, and $1.0 million and $1.8 million for the three and six month periods ended June 30, 2015, respectively, were reclassified from Other Expense, net to Interest Expense, net in the accompanying consolidated statements of operations. As of June 30, 2016, TETRA (excluding CCLP) had an outstanding balance on its Credit Agreement of $102.7 million, and had $8.1 million in letters of credit and guarantees against the revolving credit facility, leaving a net availability of $114.2 million. As of June 30, 2016, CCLP had a balance outstanding under the CCLP Credit Agreement of $236.0 million, had $2.1 million letters of credit and performance bonds outstanding, leaving a net availability under the CCLP Credit Agreement of $101.9 million. Availability under each of the TETRA Credit Agreement and the CCLP Credit Agreement is subject to compliance with the respective financial covenants and other provisions in the respective credit agreements that may limit borrowings thereunder. As described below, we and CCLP are in compliance with all covenants of our respective credit agreements and senior note agreements as of June 30, 2016. Based on our financial projections and including the impact of cost reduction efforts and expected activity levels on future estimated operating cash flows, we anticipate that, despite the current industry environment and activity levels, we will have sufficient operating cash flows to maintain compliance with the financial covenants under our amended debt agreements through June 30, 2017. With regard to CCLP, considering financial forecasts based on current market conditions as of August 9, 2016, and as a result of the impact of recent cost reduction efforts, the May 2016 amendment of certain financial covenants under the CCLP Credit Agreement, and the August 2016 receipt of $49.8 million of net proceeds from the Private Placement of the CCLP Preferred Units (including $10.0 million of proceeds received from us related to our purchase of a portion of the CCLP Preferred Units), CCLP believes that it will have adequate liquidity to fund its operations and debt obligations and maintain compliance with the financial covenants under our amended debt agreements through June 30, 2017. Our Long-Term Debt Our Credit Agreement. On July 1, 2016, we entered into an amendment (the "Fourth Amendment") of our Credit Agreement that replaced and modified certain financial covenants in the Credit Agreement. Pursuant to the Fourth Amendment, the interest charge coverage ratio covenant was deleted and replaced with a fixed charge coverage ratio. The fixed charge coverage ratio compares (a) EBITDA (as adjusted and defined in the Credit Agreement) less (1) cash income tax expense, (2) non-financed capital expenditures, and (3) cash dividends and distributions to (b) interest expense plus (1) scheduled principal payments and (2) stock purchases. The Fourth Amendment provides that the fixed charge coverage ratio may not be less than 1.25 to 1 as of the end of any fiscal quarter. The consolidated leverage ratio covenant was amended and may not exceed (a) 4.00 to 1 at the end of the fiscal quarters ending during the period from and including June 30, 2016 through and including March 31, 2018, (b) 3.75 to 1 at the end of the fiscal quarters ending during the period from and including June 30, 2018 through and including December 31, 2018, and (c) 3.5 to 1 at the end of each of the fiscal quarters thereafter. In addition, subsequent to the Fourth Amendment, borrowings will bear interest at the British Bankers Association LIBOR rate plus 2.25% to 4.00%, or an alternate base rate plus 0.00% to 1.00%, in each case depending on one of our financial ratios, and the commitment fee on unused portions of the facility will range from 0.35% to 0.75%. The Fourth Amendment also resulted in additional modifications, including a requirement that all obligations under the Credit Agreement and the guarantees of such obligations be secured by first-lien security interests in substantially all of our assets and the assets of our subsidiaries (limited, in the case of foreign subsidiaries, to 66% of the voting stock or equity interests of first-tier foreign subsidiaries). Such security interests are for the benefit of the lenders of the Credit Agreement as well as the holder of our 11% Senior Notes. Pursuant to the Fourth Amendment, bank fees and other financing costs of $0.8 million were incurred, including $0.1 million that were charged to general and administrative expense during the three month period ended June 30, 2016. At June 30, 2016, our consolidated leverage ratio was 2.27 to 1 (compared to 4.00 to 1 maximum as required under the Credit Agreement) and our fixed charge coverage ratio was 4.32 to 1 (compared to a 1.25 to 1 minimum required under the Credit Agreement). Our Senior Notes. In May 2016, we purchased for cash the Tender Offer Senior Notes, in the aggregate principal amount of $100.0 million, plus accrued and unpaid interest, pursuant to previously announced Tender Offers. The consideration paid for the Tender Offer Senior Notes was a cash amount equal to $100,000 per $100,000 principal amount of the Tender Offer Senior Notes validly tendered (and not validly withdrawn) prior to the expiration time of each Tender Offer, and validly accepted for purchase by us. The purchase of the Tender Offer Senior Notes was funded by borrowings under our Credit Agreement. In connection with the repayment of the Tender Offer Senior Notes, approximately $0.4 million of remaining unamortized deferred finance costs were charged to other expense during the three month period ended June 30, 2016. In June 2016, and following the issuance of 11.5 million shares of our common stock, we utilized a portion of the $60.4 million of net proceeds to repay the remaining $30.0 million outstanding under our Senior Secured Notes. The remaining proceeds were used to pay offering related expenses and reduce the amount of borrowings outstanding under our Credit Agreement. In connection with the repayment of the Senior Secured Notes, $1.1 million of remaining unamortized deferred finance costs were charged to other expense during the three month period ended June 30, 2016. On July 1, 2016, we entered into an Amended and Restated Note Purchase Agreement (the "Amended and Restated 11% Senior Note Agreement") with GSO Tetra Holdings LP ("GSO"), to amend and replace the previous Note Purchase Agreement relating to our $125.0 million aggregate principal amount of 11% Senior Notes due November 5, 2022 (the "11% Senior Notes"). The Amended and Restated 11% Senior Note Agreement amends certain financial covenants, including replacing the interest coverage ratio covenant in the previous Note Purchase Agreement with a minimum permitted fixed charge coverage ratio at the end of any fiscal quarter of 1.1 to 1. Additionally, the maximum permitted ratio of consolidated funded indebtedness at the end of any fiscal quarter to a defined measure of earnings increased from 3.50 to 1 to (a) 4.50 to 1 as of the end of any fiscal quarter ending during the period commencing July 1, 2016 and ending on March 31, 2018, (b) 4.25 to1 as of the end of any fiscal quarter ending during the period commencing on June 30, 2018 and ending on December 31, 2018 and (c) 4.00 to 1 as of the end of any fiscal quarter ending thereafter. Pursuant to the Amended and Restated 11% Senior Note Agreement, the 11% Senior Notes are now secured by first-lien security interests in substantially all of our assets and the assets of our subsidiaries. See the above discussion of the Fourth Amendment to our Credit Agreement for a description of these security interests. The 11% Senior Notes are now pari passu in right of payment to all borrowings under the Credit Agreement and rank at least pari passu in right of payment with all other outstanding indebtedness. The Amended and Restated 11% Senior Note Agreement contains customary covenants that limit our ability to, among other things; incur or guarantee additional indebtedness; incur or create liens; merge or consolidate or sell substantially all of our assets; engage in a different business; enter into transactions with affiliates; and make certain payments as set forth in the Amended and Restated 11% Senior Note Agreement. Pursuant to the Amended and Restated 11% Senior Note Agreement, lender fees and other financing costs of $1.2 million were incurred, including $0.2 million that were charged to general and administrative expense during the three month period ended June 30, 2016. The Amended and Restated 11% Senior Note Agreement contains customary default provisions, as well as the following cross-default provision. An event of default will occur if we (i) fail to make any payment when due beyond any applicable grace period under any indebtedness of at least $20.0 million, (ii) default in the performance of any obligation under the Amended and Restated 11% Senior Note Agreement or collateral documents and such default is not remedied within the applicable cure period, (iii) default in the performance of or compliance with any term of any indebtedness in an aggregate outstanding principal amount of at least $20.0 million or of any mortgage, indenture or other agreement relating to such indebtedness or any other condition exists, and as a result of such default or condition such indebtedness is accelerated and declared due and payable before its stated maturity or before its regularly scheduled dates for payment, (iv) we become obligated to purchase or repay indebtedness before its regular maturity or before its regularly scheduled dates of payment in an aggregate outstanding principal amount of at least $20.0 million or one or more persons have the right to require us to purchase or repay such indebtedness or (v) with certain exceptions, the security interest in the collateral ceases to be in full force and effect. Upon the occurrence and during the continuation of an event of default under the Amended and Restated 11% Senior Note Agreement, the 11% Senior Notes may become immediately due and payable, either automatically or by declaration of holders of more than 50% in principal amount of the 11% Senior Notes at the time outstanding. CCLP Long-Term Debt CCLP Credit Agreement. On May 25, 2016, CCLP entered into an amendment (the "CCLP Third Amendment") to the CCLP Credit Agreement that, among other things, modified certain financial covenants in the CCLP Credit Agreement. Pursuant to the CCLP Third Amendment, the consolidated total leverage ratio may not exceed (a) 5.50 to 1 as of June 30, 2016 and September 30, 2016; (b) 5.75 to 1 as of December 31, 2016, March 31, 2017, June 30, 2017 and September 30, 2017; (c) 5.50 to 1 as of December 31, 2017 and March 31, 2018; (d) 5.25 to 1 as of June 30, 2018 and September 30, 2018, and (e) 5.00 to 1 as of December 31, 2018 and thereafter. In addition, the consolidated secured leverage ratio was reduced from 4.00 to 1 to 3.50 to 1. The consolidated total leverage ratio and the consolidated secured leverage ratio, as both are calculated under the CCLP Credit Agreement, will exclude the long-term liability for the CCLP Preferred Units, among other items, in the determination of total indebtedness. In addition, the CCLP Third Amendment provided for other changes related to the CCLP Credit Agreement including (i) reducing the maximum aggregate lender commitments from $400.0 million to $340.0 million; (ii) increasing the applicable margin by 0.25% with a range between 2.00% and 3.00% per annum for LIBOR-based loans and 1.00% to 2.00% per annum for base-rate loans, based on the applicable consolidated total leverage ratio; (iii) imposed a requirement that CCLP use designated consolidated cash and cash equivalent balances in excess of $35.0 million to prepay the loans; (iv) imposed a requirement to deliver on an annual basis, and at such other times as may be required, an appraisal of CCLP's compressor equipment; (v) increased the amount of equipment and real property that may be disposed of in any four consecutive fiscal quarters from $5.0 million to $20.0 million; (vi) allows the prepayment or purchase of indebtedness with proceeds from the issuances of equity securities or in exchange for the issuances of equity securities; and (vii) reduced the amount of CCLP's permitted capital expenditures in the ordinary course of business during each fiscal year from $150.0 million to an amount generally ranging from $25.0 million in 2016 to $75.0 million in 2019. Pursuant to the CCLP Third Amendment, bank fees and financing costs of $0.7 million were incurred and charged to Other Expense during the three month period ended June 30, 2016. At June 30, 2016, CCLP's consolidated total leverage ratio was 5.04 to 1 (compared to 5.50 to 1 maximum as required under the CCLP Credit Agreement) and its interest coverage ratio was 3.81 to 1 (compared to a 3.0 to 1 minimum required under the CCLP Credit Agreement). CCLP 7.25% Senior Notes On August 8, 2016, in connection with the closing of the Private Placement, CCLP entered into a Note Repurchase Agreement (the “CCLP Note Repurchase Agreement”) with Hudson Bay Fund LP pursuant to which CCLP agreed to repurchase up to $20.0 million of its CCLP 7.25% Senior Notes due August 15, 2022 (the “CCLP 7.25% Senior Notes”). At any time and up to four times in the aggregate during the period beginning on September 12, 2016 and ending on October 12, 2016, Hudson Bay Fund LP may deliver a written notice to CCLP indicating the applicable closing date (the “CCLP Note Repurchase Closing Date”) and the principal amount of CCLP 7.25% Senior Notes to be purchased by CCLP. The repurchase of the CCLP 7.25% Senior Notes by CCLP is conditioned on it receiving proceeds from the sale of additional equity securities of CCLP, including, without limitation, additional CCLP Preferred Units or Series A Parity Securities (as defined in the Series A Preferred Unit Purchase Agreement) between August 8, 2016 and October 12, 2016. Additionally, the repurchase price on any CCLP Note Repurchase Closing Date shall not be greater than the proceeds then received by CCLP from the sale of equity described in the preceding sentence. For further discussion of the CCLP Preferred Units, see Note C - CCLP Series A Convertible Preferred Units.

X
- References No definition available. + Details
Name: | tti_NotesToFinancialStatementsAbstract
Namespace Prefix: | tti_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for long-term debt. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
Name: | us-gaap_LongTermDebtTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration