ProFrac gets $365 million five-year term loan at SOFR plus 725 bps

By Wendy Van Sickle

Columbus, Ohio, Dec. 28 – ProFrac Holding Corp. refinanced its existing senior secured term loan and other debt with two new financings totaling $885 million, according to a news release.

The refinancing replaces the existing term loan due March 2025 with a $365 million term loan credit facility with CLMG Corp. as agent and $520 million of senior secured notes with maturities in January 2029.

The company also reduced the capacity of its ABL facility with JPMorgan Chase Bank, NA as agent to $325 million from $400 million.

The new term loans were made to ProFrac’s wholly owned subsidiaries that hold and run ProFrac’s proppant business, including Alpine Holding II, LLC and PF Proppant Holding, LLC.

The term loan matures on Jan. 26, 2029 and bears interest at SOFR plus a margin of 725 basis points, subject to a 3% SOFR floor as well as a maximum rate.

Mandatory principal payments commence at the end of the calendar quarters ending June 30, 2024, Sept. 30, 2024 and Dec. 31, 2024, in an amount equal to $5 million on each such date followed by quarterly payments of $15 million.

Obligations under the 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.

Under the amendment to the ABL revolver, Alpine Holding and its subsidiaries were designated as excluded subsidiaries and unrestricted subsidiaries, and liens held by the lenders on the assets of the excluded subsidiaries and all guarantees of the obligations under credit facility made by the excluded subsidiaries were released, terminated and discharged.

The ABL facility has a maturity date of the earlier of March 4, 2027 and 91 days prior to the maturity of any material debt.

Matt Wilks, ProFrac’s executive chairman, stated in the release that the refinancing “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.”

ProFrac is a Fort Worth-based oil and gas services company.

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