AMENDMENT NO. 1
Exhibit
10.1
AMENDMENT NO. 1
This Amendment No. 1 (this “Amendment”) is dated as of March 28, 2006 and is to the Third
Amended and Restated Credit Agreement, dated as of October 3, 2003, amended and restated as of
November 17, 2003, and December 21, 2004, and as further amended and restated as of December 15,
2005 (the “Credit Agreement”), among BASIC ENERGY SERVICES, INC., a Delaware corporation
(“Borrower”), the Subsidiary Guarantors party thereto, the Lenders party thereto, UBS LOAN FINANCE
LLC, as Swingline Lender and as a Lender, BANK OF AMERICA, N.A., as Syndication Agent, HIBERNIA
NATIONAL BANK, as co-documentation agent, BNP PARIBAS, as co-documentation agent and UBS AG,
STAMFORD BRANCH, as Issuing Bank, as administrative agent (in such capacity, “Administrative
Agent”) for the Lenders and as Collateral Agent for the Secured Parties and the Issuing Bank. All
capitalized terms used herein and not otherwise defined herein shall have the respective meanings
provided such terms in the Credit Agreement.
W I T N E S S E T H:
WHEREAS, Section 11.02 of the Credit Agreement permits the Credit Agreement to be amended from
time to time with the written consent of the Required Lenders;
NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION ONE Amendments.
(a) The definition of “Debt Issuance” shall be replaced in its entirety with the following:
“Debt Issuance” shall mean the incurrence by Borrower or any of its Subsidiaries of any
Indebtedness after the Closing Date (other than as permitted by Sections 6.01(a) through
(f) and (h) through (j)).
(b) The definition of “LC Commitment” shall be amended by replacing “$20.0 million” with
“$30.0 million”.
(c) The definition of “Leases” shall be amended by adding the following sentence at the end
thereof:
“Notwithstanding the foregoing, the definition of Leases shall not include Capital Lease
Obligations.”
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(d) The definition of “Permitted Subordinated Indebtedness” shall be replaced in its entirety
with the following:
““Permitted Unsecured Indebtedness” shall mean senior or senior subordinated debt of the
Borrower, (i) the terms of which (a) do not provide for any scheduled repayment, mandatory
redemption or sinking fund obligations prior to 90 days after the Term B Maturity Date, (b) do not
materially and adversely restrict or limit the ability of Borrower or any of its subsidiaries to
perform their obligations under any of the Loan Documents and (c) to the extent subordinated debt,
provides for customary subordination of the obligations under the Loan Documents and (ii) the
covenants, events of default, subsidiary guarantees, credit support and subordination terms are
customary for similar offerings by issuers with credit ratings comparable to that of the issuer of
such debt and the subordination terms are otherwise satisfactory to the Administrative Agent.”
(e) The term “Permitted Subordinated Indebtedness” shall be replaced with the term “Permitted
Unsecured Indebtedness” in each instance such term appears in the Credit Agreement (being
Section 6.01(g), twice in Section 6.09 and in Section 6.10).
(f) The phrase “or any Permitted Unsecured Indebtedness” shall be inserted following the words
“relating to the Loans” in the definition of “Secured Parties.”
(g) The first paragraph of Section 2.10(h) of the Credit Agreement shall be amended and
replaced in its entirety with the following:
“(h) Application of Prepayments. Any prepayments of Loans pursuant to Section
2.10(c), (d), (e) or (f) shall be applied to reduce scheduled payments
of Term B Loans required under Section 2.09(a) on a pro rata basis among the payments due
on each Term B Loan Repayment Date based on the payments then due on each Term B Loan Repayment
Date. After application of mandatory prepayments described above in this paragraph (h) and to the
extent there are mandatory prepayment amounts remaining after such application, (1) any outstanding
Revolving Loans shall be repaid ratably among the Revolving Lenders in accordance with their
applicable Revolving Commitments in an aggregate amount equal to such excess and (2) in the event
any such mandatory prepayments of Revolving Loans are made pursuant to Sections 2.10(c) or
(f) or, other than with respect to Permitted Unsecured Indebtedness, Section
2.10(d), the Revolving Commitments shall be reduced ratably among the Revolving Lenders in
accordance with their applicable Revolving Commitments in an aggregate amount equal to such amount
prepaid pursuant to clause (1) of this paragraph (h), and Borrower shall comply with Section
2.10(b).”
(h) Section 2.18(b) of the Credit Agreement shall be amended by replacing “$20.0 million” with
“$30.0 million”.
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(i) Section 5.01(h) of the Credit Agreement shall be amended by replacing “each fiscal month”
with “each fiscal quarter”.
(j) Section 5.10 of the Credit Agreement shall be amended and replaced in its entirety with
the following:
“SECTION 5.10. Interest Rate Protection . Borrower shall maintain or cause
to be maintained, until the earlier of (i) the date on which all Term B Loans are discharged or
paid in accordance with the terms hereof and (ii) through May 28, 2006, Interest Rate Agreements
acceptable to the Administrative Agent that result in at least $65,000,000 of the aggregate
principal amount of Borrower’s Consolidated Indebtedness being effectively subject to a fixed or
maximum interest rate acceptable to the Administrative Agent.”
(k) Section 6.01(c) of the Credit Agreement shall be amended by replacing it in its entirety
with the following:
“(c) Indebtedness of any Company under Interest Rate Agreements entered into in order to fix
the effective rate of interest on the Loans in compliance with Section 5.10 and such other
non speculative Interest Rate Agreements which may be entered into from time to time by any Company
and which such Company in good faith believes will provide benefits or protection with respect to
Indebtedness then outstanding, and permitted to remain outstanding, pursuant to the other
provisions of this Section 6.01;”
(l) Section 6.02(f) of the Credit Agreement shall be amended by replacing “$1,000,000” with
“$10.0 million”.
(m) Section 6.02(n) of the Credit Agreement shall be amended by replacing “$5.0 million” with
“$10.0 million”.
(n) Section 6.04(l) of the Credit Agreement shall be amended and replaced in its entirety with
the following:
“(l) scheduled payments of Earn Out Obligations.”
(o) Section 6.06(b) of the Credit Agreement shall be amended by inserting the following clause
at the beginning thereof:
“Until such date (the “Permitted Unsecured Indebtedness Trigger Date”) as Borrower has issued
at least $200 million of Permitted Unsecured Indebtedness in compliance with this Agreement, ”
(p) Section 6.06 of the Credit Agreement shall be further amended by inserting the following
new Section 6.06(c):
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“(c) On and after the Permitted Unsecured Indebtedness Trigger Date, Borrower may pay cash
Dividends from time to time, so long as:
(i) no (A) Event of Default exists or (B) (on a pro forma basis after giving
effect to payment of such Dividends) Default would result therefrom at the time of
declaration thereof and, either
(ii) the amount of such Dividend does not exceed (A) 50% of Consolidated Net
Income for the period (taken as one accounting period) commencing on the first day
of the fiscal quarter ending after the Permitted Unsecured Indebtedness Trigger Date
to and including the last day of the fiscal quarter ended immediately prior to the
date of such calculation for which consolidated financial statements are available
(or, if such Consolidated Net Income shall be a deficit, minus 100% of such
aggregate deficit), minus (B) the aggregate amount of all other Dividends made after
the Third Amendment and Restatement Effective Date (including, for the avoidance of
doubt, Dividends made pursuant to clause (iii), below, of this Section 6.06(c)); or
(iii) the aggregate amount of such Dividend, when combined with all other
Dividends paid during the same fiscal year does not exceed $10 million.”
(q) Section 6.16 of the Credit Agreement shall be deleted in its entirety.
(r) Section 8.01(f) of the Credit Agreement shall be amended by replacing “$1.0 million” with
“$10.0 million”.
(s) Section 8.01(g) of the Credit Agreement shall be amended by adding the following
parenthetical at the end of clause (iii):
“(excluding, for purposes of clarification, any Liens on bonds or other collateral posted
pursuant to a court order while there exists an effective stay of enforcement of a judgment)”
SECTION TWO Conditions to Effectiveness. This Amendment shall become effective as of
the date hereof (the “Effective Date”) if the Administrative Agent shall have received (i)
counterparts of this Amendment executed by the Borrower, (ii) signature pages to this Amendment
executed by the Issuing Bank and a number of Lenders sufficient to constitute the Required Lenders
and (iii) payment from the Borrower for the account of each Lender which shall have delivered to
the Administrative Agent a copy of this Amendment No. 1 executed by such Lender before 5:00 p.m.
New York City time on March 28, 2006, an amendment fee equal to 0.10% of such Lender’s total
Commitments. The effectiveness of this Amendment is further conditioned upon the accuracy of the
representations and warranties set
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forth in Section Three hereof and the payment of the fees and expenses of Xxxxxx Xxxxxx &
Xxxxxxx LLP, counsel to the Administrative Agent.
SECTION THREE Representations and Warranties; Covenants. In order to induce the
Required Lenders to enter into this Amendment, each Borrower represents and warrants to each of the
Lenders that both before and immediately after giving effect to this Amendment: (a) no Default or
Event of Default has occurred and is continuing and (b) all of the representations and warranties
in the Credit Agreement and in the other Loan Documents are true and complete in all material
respects on and as of the date hereof as if made on the date hereof (or, if any such representation
or warranty is expressly stated to have been made as of a specific date, as of such specific date).
SECTION FOUR Reference to and Effect on the Credit Agreement. On and after the
Effective Date, each reference in the Credit Agreement to the “Agreement,” “hereunder,” “hereof” or
words of like import referring the Credit Agreement, and each reference in each of the Loan
Documents to “the Credit Agreement,” “thereunder,” “thereof” or words of like import referring to
the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended by this
Amendment. The Credit Agreement and each of the other Loan Documents, as specifically amended by
this Amendment, are and shall continue to be in full force and effect and are hereby in all
respects ratified and confirmed. The execution, delivery and effectiveness of this Amendment shall
not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any
Lender or any Agent under any of the Loan Documents, or constitute a waiver of any provision of any
of the Loan Documents.
SECTION FIVE Costs and Expenses. Whether or not the Effective Date occurs, the
Borrower agrees to pay all reasonable costs and expenses of the Administrative Agent in connection
with the preparation, execution and delivery of this Amendment and the other instruments and
documents to be delivered hereunder, if any (including, without limitation, the reasonable fees and
expenses of Xxxxxx Xxxxxx & Xxxxxxx LLP , counsel to the Administrative Agent).
SECTION SIX Execution in Counterparts. This Amendment may be executed in any number
of counterparts and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall constitute but one
and the same agreement. Delivery of an executed counterpart of a signature page to this Amendment
by facsimile shall be effective as delivery of a manually executed counterpart of this Amendment.
SECTION SEVEN Lender Signatures. Each Lender that signs a signature page to this
Amendment shall be deemed to have approved this Amendment and shall be further deemed for the
purposes of the Loan Documents to have approved this Amendment. Each Lender signatory to this
Amendment agrees that such Lender shall not be entitled to re
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ceive a copy of any other Lender’s signature page to this Amendment, but agrees that a copy of
such signature page may be delivered to Borrowers and the Administrative Agent.
SECTION EIGHT Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO ANY PROVISIONS THEREOF
RELATING TO CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION).
[Signature Pages Follow]
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Amendment to
be duly executed and delivered as of the date first above written.
| BASIC ENERGY SERVICES, INC., as Borrower |
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| By: | /s/ Xxxx Xxxxxx | |||
| Name: | Xxxx Xxxxxx | |||
| Title: | Vice President, Chief Financial Officer and Treasurer | |||
| UBS AG, STAMFORD BRANCH, as
Administrative Agent and Issuing Bank |
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| By: | /s/ Xxxx X. Xxxx | |||
| Name: | Xxxx X. Xxxx | |||
| Title: | Associate Director Banking Products Services, US |
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| By: | /s/ Xxxxxx Oh | |||
| Name: | Xxxxxx Oh | |||
| Title: | Associate Director Banking Products Services, US |
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