TETRA TECHNOLOGIES INC 10-K

Item 7A. Quantitative and Qualitative Disclosures about Market Risk. Interest Rate Risk The interest on our borrowings is subject to market risk exposure related to changes in applicable interest rates. Borrowings under our revolving credit facility bear interest at an agreed-upon percentage rate spread above LIBOR. Borrowings under the Term Credit Agreement bear interest at a rate per annum equal to, at the option of TETRA, either (i) LIBOR (subject to a 1% floor) plus a margin of 6.25 % per annum or (ii) a base rate plus a margin of 5.25 % per annum. The following table sets forth as of December 31, 2021, the principal amount due under our long-term debt obligations and their respective weighted average interest rates. We are not a party to an interest rate swap contract or other derivative instrument designed to hedge our exposure to interest rate fluctuation risk. Interest December 31, Scheduled Maturity Rate 2021 (In Thousands) Asset-based credit agreement May 31, 2025 4.75 % $ 1,614 Term credit agreement September 10, 2025 7.25 % 163,071 Total long-term debt $ 164,685 Exchange Rate Risk We are exposed to fluctuations between the U.S. dollar and the euro with regard to our euro-denominated operating activities. We also have currency exchange rate risk exposure related to revenues, expenses, operating receivables, and payables denominated in foreign currencies. We may enter into 30-day foreign-currency forward derivative contracts as part of a program designed to mitigate the currency exchange rate risk exposure on selected transactions of certain foreign subsidiaries. Although contracts pursuant to this program will serve as an economic hedge of the cash flow of our currency exchange risk exposure, they are not expected to be formally designated as hedge contracts or qualify for hedge accounting treatment. Accordingly, any change in the fair value of these derivative instruments during a period will be included in the determination of earnings for that period. As of December 31, 2021, we did not have any foreign currency exchange contracts outstanding. Item 8. Financial Statements and Supplementary Data. The financial statements and supplementary data required to be included in this Item 8 are set forth in Item 15 of this Annual Report. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None.