Exhibit 10.2
MODIFICATION AGREEMENT
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This Modification Agreement ("Modification Agreement") is effective as of
December 15, 2004. The parties to the Modification Agreement are Natural Gas
Services Group, Inc. ("Borrower") and Western National Bank ("Lender").
RECITALS
On November 3, 2003, Borrower executed and delivered to Lender that certain
Advancing Line of Credit Promissory Note in the original principal sum of
$10,000,000.00, bearing interest at the rate stated therein, with a stated final
maturity date of November 15, 2009 (the "Note"), pursuant to that certain Second
Amended and Restated Loan Agreement dated November 3, 2003 (the " Loan
Agreement"). All liens, security interests and assignments securing the Note are
collectively called the "Liens". Terms defined in the Note or the Loan Agreement
and not otherwise defined herein shall have the same meanings here as in those
documents.
Contemporaneously with the execution and delivery by Borrower to Lender of that
certain First Modification to Second Amended and Restated Loan Agreement of even
date herewith between Borrower and Lender, (the "First Modification"), Borrower
and Lender agreed (a) to increase the Borrowing Base of said Note from
$7,000,00.00 to $10,000,000.00, (b) extend the period for Borrower to request
advances under the Note from November 3, 2004, to December 14, 2005, (c) modify
the provisions relating to the amortization of advances between the date hereof
and an December 14, 2005, and (d) to make other related changes to the Loan
Agreement to incorporate such agreement and substitution.
Further, Borrower and Lender agreed to enter into this Modification Agreement to
modify the interest provisions of the Note to provide for an increase in the
interest floor from five and one-fourth percent (5.25%) to six percent (6%), and
to ratify the Liens.
AGREEMENT
1. Modification of Interest Provisions of the Note. In lieu of the following
provisions which were contained in the first paragraph of Note:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) five and one-fourth percent (5.25%), or (b) the
Highest Lawful Rate, in each case calculated on the basis of actual
days elapsed, but computed as if each calendar year consisted of 360
days."
such provisions of the Note are changed to read in their entirety as follows:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) six percent (6.0%), or (b) the Highest Lawful Rate,
in each case calculated on the basis of actual days elapsed, but
computed as if each calendar year consisted of 360 days."
2. Modification of Payment Provisions of the Note. In lieu of the following
provision which was contained in the fourth (4th) paragraph of the Note:
"The principal of this Note shall be due and payable in (a)
fifty-nine consecutive monthly installments which shall each be in an
amount equal to 1/60th of the outstanding principal balance of this
Note on December 15, 2004, with the first such installment being due
and payable on December 15, 2004, and a like installment being due and
payable on the fifteenth day of each succeeding month to and including
October 15, 2009; and (b) one final installment in an amount equal to
all remaining unpaid principal and accrued and unpaid interest on this
Note shall be due and payable on November 15, 2009. Interest, computed
on the unpaid balance of this Note, shall be due and payable monthly as
it accrues, on the same dates as, but in addition to each installment
of principal."
such provision of the Note is changed to read as follows:
"The principal of this Note shall be due and payable as
follows:
(a) with respect to the principal balance outstanding under this
Note on December 15, 2004, in fifty-nine (59) consecutive
monthly installments of $116,666.67, with the first (1st) such
installment being due and payable on December 5, 2004 and a
like installment being due and payable on the 15th day of each
succeeding month to and including October 15, 2009; plus
(b) 1/60th of the sum of all advances made by Lender under this
note after December 15, 2004 and prior to March 31, 2005 and a
like installment being due and payable on the 15th day of each
succeeding month to and including October 15, 2009; plus
(c) 1/60th of the sum of all advances made by Lender under this
note after April 1, 2005 and prior to June 30, 2005, and a
like installment being due and payable on the 15th day of each
succeeding month to and including October 15, 2009; plus
(d) 1/60th of the sum of all advances made by Lender under this
note after July 1, 2005 and prior to September 30, 2005 and a
like installment being due and payable on the 15th day of each
succeeding month to and including October 15, 2009; plus
(e) 1/60th of the sum of all advances made by Lender under this
note after October 1, 2005 and prior to December 15, 2005 and
a like installment being due and payable on the 15th day of
each succeeding month to and including October 15, 2009; plus
(f) one final installment in an amount equal to all remaining
unpaid principal and accrued and unpaid interest on the Note
shall be due and payable on November 15, 2009.
Interest, computed on the unpaid balance of the Note, shall be due and payable
monthly as it accrues, on the same dates as, but in addition to each installment
of principal."
3. Ratification of Liens. Borrower and Lender further agree that all Liens
securing the Note shall continue and carry forward until the Note and all
indebtedness evidenced thereby is paid in full. Borrower further agrees that
such liens are hereby ratified and affirmed as valid and subsisting against the
collateral described therein, and that this Modification Agreement shall in no
manner vitiate, affect or impair the Note or the Liens (except as expressly
modified in this Modification Agreement) and that such Liens shall not in any
manner be waived, released, altered or modified.
4. Miscellaneous.
(a) As modified hereby, the provisions of the Note and the Liens
shall continue in full force and effect, and Borrower
acknowledges and affirms its liability to Lender thereunder.
In the event of an inconsistency between this Modification
Agreement and the terms of the Note or of the Liens, this
Modification Agreement shall govern.
(b) Borrower hereby agrees to pay all costs and expenses incurred
by Lender in connection with the execution and administration
of this Modification Agreement.
(c) Any default by Borrower in the performance of his obligations
herein contained shall constitute a default under the Note and
the Liens and shall allow Lender to exercise any or all of its
remedies set forth in such Note and Liens or at law or in
equity.
(d) Lender does not, by its execution of this Modification
Agreement, waive any rights it may have against any person not
a party hereto.
(e) All terms, provisions, covenants, agreements, and conditions
of the Note and the Liens are unchanged, except as provided
herein. Borrower agrees that this Modification Agreement and
all of the covenants and agreements contained herein shall be
binding upon Borrower and shall inure to the benefit of Lender
and each of their respective heirs, executors, legal
representatives, successors, and permitted assigns.
THIS MODIFICATION AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
Borrower:
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Natural Gas Services Group, Inc.
By:_________________________________________
Xxxxxxx X. Xxxxxxxx, President
Lender:
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Western National Bank
By:_________________________________________
Xxxxx X. Xxxxxx, Executive Vice President
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on December _____, 2004, by
Xxxxxxx X. Xxxxxxxx, President of Natural Gas Services Group, Inc., a Colorado
corporation, on behalf of said corporation.
_____________________________
Notary Public, State of Texas
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on December _____, 2004, by
Xxxxx X. Xxxxxx, Executive Vice President of Western National Bank, a national
banking association, on behalf of said association.
_____________________________
Notary Public, State of Texas
