Long-Term Debt and Other Borrowings

12 Months Ended

Dec. 31, 2011

Notes to Financial Statements [Abstract]

NOTE D - LONG-TERM DEBT AND OTHER BORROWINGS

Long-term debt consisted of the following as of:

		December 31,
	Maturity Date	2011		2010
		(In Thousands)

7.5% Affiliate Note	December 31, 2020	$	-	$	145,085
Bank revolving line of credit facility	June 24, 2015		-		-
			-		145,085
Less current portion			-		-
Total long-term debt		$	-	$	145,085

Long-term debt of our Predecessor consisted of a revolving credit promissory note payable (the Affiliate Note) to an affiliate of TETRA. The Affiliate Note, as refinanced in December 2010, was scheduled to mature on December 31, 2020. Pursuant to the Affiliate Note, interest accrued at 7.5% per annum, and was due and payable at December 31 of each year. Under the terms of the Affiliate Note, unpaid interest could be added to the note balance, subject to the maximum principal balance allowable.

As part of the offering, TETRA made a capital contribution to our Predecessor sufficient for it to repay approximately $112.9 million of the principal balance of the Affiliate Note as well as all of the interest accrued on the Affiliate Note as of June 20, 2011. The remaining $32.2 million balance of the Affiliate Note was then assumed by us as part of TETRA's contribution of net assets as of the June 20, 2011 date of the offering. Following our receipt of the offering proceeds, we repaid the $32.2 million balance to TETRA, and the Affiliate Note was paid in full.

On June 24, 2011, we entered into a new credit agreement (the Credit Agreement) with JPMorgan Chase Bank, N.A. Under the Credit Agreement, we, along with certain of our subsidiaries, are named as borrowers, and all obligations under the Credit Agreement are guaranteed by all of our existing and future, direct and indirect, domestic subsidiaries. The Credit Agreement includes borrowing capacity of $20.0 million less $3.0 million that is required to be set aside as a reserve that cannot be borrowed. The credit facility is available for letters of credit (with a sublimit of $5.0 million) and includes an uncommitted $20.0 million

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expansion feature. The Credit Agreement may be used to fund our working capital needs, letters of credit, and for general partnership purposes, including capital expenditures and potential future acquisitions. So long as we are not in default, the Credit Agreement may also be used to fund quarterly distributions. Borrowings under the Credit Agreement are subject to the satisfaction of customary conditions, including the absence of a default. As of December 31, 2011, there is no balance outstanding under the Credit Agreement. The maturity date of the Credit Agreement is June 24, 2015.

All obligations under the Credit Agreement and the guarantees of those obligations are secured, subject to certain exceptions, by a first lien security interest in substantially all of our assets and the assets (excluding real property) of our existing and future, direct and indirect domestic subsidiaries, and all of the capital stock of our existing and future, direct and indirect subsidiaries (limited, in the case of foreign subsidiaries, to 65% of the capital stock of first tier foreign subsidiaries).

Borrowings under the Credit Agreement bear interest at a rate per annum equal to, at our option, either (a) LIBOR (adjusted to reflect any required bank reserves) for an interest period equal to one, two, three or six months (as we select) plus a margin of 2.25% per annum or (b) a base rate determined by reference to the highest of (1) the prime rate of interest announced from time to time by JPMorgan Chase Bank, N.A. or (2) LIBOR (adjusted to reflect any required bank reserves) for a one-month interest period on such day, plus 2.50% per annum. In addition to paying interest on any outstanding principal under the Credit Agreement, we are required to pay a commitment fee, in respect of the unutilized commitments thereunder, of 0.425% per annum, paid quarterly in arrears. We are also required to pay customary collateral monitoring fees and letter of credit fees, including without limitation, a letter of credit fee equal to the applicable margin on revolving credit LIBOR loans and fronting fees.