What: Shares of NOW (DNOW 0.10%) declined more than 16% in the month of January as overall market weakness continued to push share prices down. This was even after the company announced that it had agreed with its lenders to revise its credit facility.

So what: Back in December, NOW issued a notice that it was looking to revise the covenants on its credit facility. The reasoning behind it was that the company probably wasn't going to be able to remain in compliance with the interest coverage ratio covenant, and that it had been granted a waiver from its creditors while it renegotiated those its credit lines. 

A few weeks later, in January, the company said it had come to an agreement with its creditors to lift the existing debt covenants and replace them. Under the new agreement, the company will be able to borrow up to a certain certain percentage of its eligible assets. In exchange, it had to reduce its maximum allowable capitalization ratio and agree to a higher interest rate. 

Being able to access capital right now is a pretty critical element for the company. With the entire oil and gas market depressed, there are plenty of acquisition opportunities, and NOW CEO Robert Workman has said he wants to use this opportunity to make some deals. Now that it has a little more flexibility under that credit line, the company can go on the hunt for some deals. 

Now what: As a parts and equipment distributor to the oil and gas industry, DNOW's shares are going to be inexorably tied to overall drilling activity, which is, of course, in a very weak place right now. However, once activity does pick up, the company is going to have its hands full as companies look to make overdue repairs to equipment. Also, with the flexibility to go out and finance some deals with a little extra room on its credit line, today's share price declines may be an opportunity to buy shares that are trading down 60% since the oil market started on its downward spiral.