Under the new two year facility, expiring December 31, 2019, Cathedral’s credit availability will consist of a $5 million operating facility and $15 million extendible revolving credit facility. The key financial covenants include a maximum funded debt to bank EBITDA ratio of 3.0 to 1.0 and an interest coverage ratio of not less than 2.50 to 1.0, both of which are calculated quarterly.
Cathedral’s previous credit facility provided for availability of $23 million. The company reduced the facility size compared to the previous facility to decrease standby and other fees. Cathedral has yet to draw on either the previous or new credit facility and as at September 30, 2017, had $4 million in cash.
Cathedral expects the new credit facility to be in place by December 31, 2017.
Cathedral Energy Services, based in Calgary, Alberta, partners with North American energy companies requiring high performance directional drilling services.