EXHIBIT 4 (5.1)
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (the "Amendment") is effective
as of the 30th day of April, 2003 by and among XXXXX XXXXXXXXXXX COMPANY, a
Delaware corporation ("Layne"), XXXXXX BROS. DRILLING COMPANY, a Utah
corporation ("Xxxxxx"), XXXXXXXXXXX XXXXXX CORPORATION, a Delaware corporation,
INTERNATIONAL DIRECTIONAL SERVICES, L.L.C. a Delaware limited liability company
("IDS"), LAYNE WATER DEVELOPMENT AND STORAGE, LLC, a Delaware limited liability
company, ("LWDS") LAYNE TEXAS, INCORPORATED, a Delaware corporation,
MID-CONTINENT DRILLING COMPANY, a Delaware corporation, SHAWNEE OIL & GAS,
L.L.C., a Delaware limited liability company, XXXXX-XXXXXXX INCORPORATED, a
Louisiana corporation, TOLEDO OIL & GAS SERVICES, INC., a Louisiana corporation,
and VIBRATION TECHNOLOGY, INC., a Delaware corporation, (collectively, including
Layne, IDS and LWDS, the "Borrowers" or individually a "Borrower"); the other
Credit Parties signatory hereto; GENERAL ELECTRIC CAPITAL CORPORATION, a
Delaware corporation ("Agent"), for itself, as Lender, and as Agent for Lenders,
and the other Lenders signatory hereto from time to time; and LASALLE BANK
NATIONAL ASSOCIATION ("Revolving Credit Agent"), for itself, as Lender, and as
Revolving Credit Agent for the Revolving Lenders.
RECITALS
A. Borrowers, Agent, Revolving Credit Agent and the Lenders have
entered into that certain Credit Agreement dated as of July 9, 2002 (as may be
amended from time to time, the "Credit Agreement"). All capitalized terms used
herein and not otherwise defined shall have the meaning assigned to them in the
Credit Agreement.
B. Pursuant to the Credit Agreement, Lenders agreed to make Loans
to Borrowers from time to time in the aggregate principal amount of up to
$70,000,000.00.
C. Borrowers, Agent, Revolving Credit Agent and the other Lenders
desire to add IDS as a Borrower and amend the Credit Agreement as set forth
herein.
AGREEMENT
NOW THEREFORE, in consideration of the Recitals and of the mutual
promises and covenants contained herein, Agent, Lenders and Borrowers agree as
follows:
1. Amendments to Credit Agreement. Subject to the satisfaction of each of
the conditions precedent set forth in Section 2 below, the Credit Agreement is
hereby, effective as of the date hereof, amended as follows:
(a) Fees. Section 1.9(c) of the Credit Agreement is
hereby deleted and the following inserted therefore:
"(c) If Borrowers pay after acceleration or prepay all or
any portion of the Term Loan or prepay the Revolving Loan and
terminate the Revolving Loan
Commitment, whether voluntarily or involuntarily and whether
before or after acceleration of the Obligations, or if any of
the Commitments are otherwise terminated, Borrowers shall pay
to Agent (with respect to a prepayment or termination of the
Term Loan) or Revolving Credit Agent (with respect to a
prepayment, or termination of the Revolving Loan), for the
benefit of Lenders as liquidated damages and compensation for
the costs of being prepared to make funds available hereunder
an amount equal to the Applicable Percentage (as defined
below) multiplied by the sum of (i) the principal amount of
the Term Loan paid after acceleration or prepaid, and (ii) in
the event of prepayment of the Revolving Loan and termination
of the Revolving Loan Commitment, the Revolving Loan
Commitment. As used herein, the term "Applicable Percentage"
shall mean (x) two percent (2.0%), in the case of a prepayment
on or prior to the first anniversary of the Closing Date, (y)
one percent (1.0%), in the case of a prepayment after the
first anniversary of the Closing Date but on or prior to the
second anniversary thereof, and (z) zero percent (0.0%), in
the case of a prepayment after the second anniversary of the
Closing Date. The Credit Parties agree that the Applicable
Percentages are a reasonable calculation of Lenders' lost
profits in view of the difficulties and impracticality of
determining actual damages resulting from an early termination
of the Commitments. Notwithstanding the foregoing, no
prepayment fee shall be payable by Borrowers upon a mandatory
prepayment made pursuant to Sections 1.3(b)(i), (ii), or (iv)
or 1.16(c); provided that in the case of prepayments made
pursuant to Sections 1.3(b)(ii), the transaction giving rise
to the applicable prepayment is expressly permitted under
Section 6."
(b) Additional Definitions-Annex A. The following
definition shall be added to Annex A of the Credit Agreement:
"Non-Consolidated Joint Venture" shall mean a non-consolidated
joint venture, partnership, other business association or
non-consolidated Affiliate in which the ownership interests
are held in part by any Borrower and an unrelated third party
or parties."
(c) Revised Definitions- Annex A. The following
definition shall be revised:
"Adjusted Capital Expenditure" shall mean, with respect to
Borrowers, Capital Expenditures plus, direct and indirect
investments by Xxxxx, Xxxxxxx Oil & Gas, L.L.C. or LWDS in
Non-Consolidated Joint Ventures, related in each case to coal
bed methane projects and water resource management projects."
(d) Additional Pledges. Sections 5.12 of the Credit
Agreement is hereby deleted and the following inserted therefor:
"5.12 ADDITIONAL PLEDGES.
Except as required by Section 6.1, to the extent any Borrower
acquires investments or interests following the Closing Date,
including any investment or interests in Subsidiaries, joint
ventures, partnerships or other entities, such
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Borrower shall, except to the extent that Agent and Revolving
Credit Agent otherwise agrees, pledge and grant a first
priority perfected security interest in all such investments
or interests, including any Stock, to Agent, for the benefit
of the Lenders, and execute pledge agreements, security
agreements and other documents or instruments, and deliver
such certificates and stock powers, as Agent shall, in its
sole discretion require. Notwithstanding the foregoing, no
Borrower shall be required to pledge to Agent or grant to
Agent a first priority perfected security interest in any
Non-Consolidated Joint Venture, if such pledge or grant of is
prohibited by the new Non-Consolidated Joint Venture's
organizational documents or partnership agreement."
(e) Investments. Section 6.2(c) of the Credit Agreement
is hereby deleted and the following is inserted therefor:
"(c) Borrowers may make investments in or incur indebtedness
in connection with or as a result of such investment or
indebtedness not to exceed $1,500,000.00 in the aggregate at
any one time in Non-Consolidated Joint Ventures."
(f) Indebtedness. Section 6.3(a) of the Credit Agreement
is hereby deleted and the following is inserted therefor:
"6.3 INDEBTEDNESS.
"(a) No Credit Party shall or shall allow any of their
Subsidiaries to create, incur, assume or permit to exist any
Indebtedness, except (without duplication) (i) Indebtedness
secured by purchase money security interests and Capital
Leases permitted in Section 6.7(c), (ii) the Loans and the
other Obligations, (iii) unfunded pension fund and other
employee benefit plan obligations and liabilities to the
extent they are permitted to remain unfunded under applicable
law, (iv) existing Indebtedness described in Disclosure
Schedule (6.3) and refinancings thereof or amendments or
modifications thereto that do not have the effect of
increasing the principal amount thereof or changing the
amortization thereof (other than to extend the same) and that
are otherwise on terms and conditions no less favorable to any
Credit Party, as determined by Requisite Lenders, than the
terms of the Indebtedness being refinanced, amended or
modified, (v) Indebtedness specifically permitted under
Section 6.1; (vi) Indebtedness consisting of intercompany
loans and advances made by any Borrower to any other Borrower;
provided, that: (A) Borrowers shall record all intercompany
transactions on its books and records in a manner reasonably
satisfactory to Agent; (B) the obligations of Borrowers under
any such intercompany loans and advances shall be subordinated
to the Obligations of Borrowers hereunder in a manner
reasonably satisfactory to Agent; (C) at the time any such
intercompany loan or advance is made by any Borrower to any
other Borrower and after giving effect thereto, each such
Borrower shall be Solvent; and (D) no Default or Event of
Default would occur and be continuing after giving effect to
any such proposed intercompany loan;(vii) Subordinated Debt
under non-compete agreements entered into in connection with
Permitted Acquisitions and not exceeding in the aggregate at
any time $1,000,000, (viii)
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Indebtedness evidenced by non-interest bearing promissory
notes representing obligations under various casualty
insurance policies to reimburse the issuing insurance
companies for claims against Borrowers paid by such insurance
companies; (ix) Indebtedness incurred pursuant to Section
6.2(c); (x) other unsecured Indebtedness at any time
outstanding, in addition to Indebtedness permitted by clauses
(i) through (ix) which shall not exceed $2,000,000."
(g) Sale of Stock and Assets. Section 6.8 of the Credit
Agreement is hereby deleted and the following inserted therefore:
"6.8 SALE OF STOCK AND ASSETS.
"No Credit Party shall sell, transfer, convey, assign or
otherwise dispose of any of its properties or other assets,
including the Stock of any of its Subsidiaries (whether in a
public or a private offering or otherwise) or any of its
Accounts, other than (a) the sale of Inventory in the ordinary
course of business; (b) the sale, transfer, conveyance or
other disposition by a Credit Party of Equipment, Fixtures or
Real Estate pursuant to which the entire amount of net
proceeds of such sale, transfer, conveyance or disposition are
used (within 45 days of receipt thereof) to purchase
replacements of such Equipment, Fixtures and Real Estate
having a net book value not exceeding $2,000,000 in any single
transaction or $5,000,000 in the aggregate in any Fiscal Year;
(c) the sale, transfer, conveyance or other disposition by a
Credit Party of Equipment, Fixtures or Real Estate that are
obsolete or no longer used or useful in such Credit Party's
business and having a net book value not exceeding $250,000 in
any single transaction or $1,000,000 in the aggregate in any
Fiscal Year; (d) other Equipment and Fixtures having a value
not exceeding $100,000 in any single transaction or $1,000,000
in the aggregate in any Fiscal Year; (e) the sale of Xxxxx'x
interest in Drilling Equipment Supply, Inc. for fair market
value to a third-party purchaser in an arms length
transaction; (f) the sale of Xxxxx'x interest in Worldcover,
Inc. for fair market value to an unrelated third-party
purchaser in an arms length transaction; (g) the sale of
Xxxxx'x interest in Stanmines NL's (Malaga, Western Australia)
for fair market value to an unrelated third-party purchaser in
an arms length transaction; (h) the sale of Stock of
Non-Consolidated Joint Venture pursuant to any "buy/sell"
provision (which shall be acceptable to Agent in its sole
discretion) of any such entity's organizational documents or
partnership agreement, and (i) the sale, transfer, conveyance
or other disposition of the Real Estate located in Sunbury,
Ohio and/or Salt Lake City, Utah, for their fair market value
to an unrelated third-party purchaser in an arm's length
transaction. With respect to any disposition of assets or
other properties permitted pursuant to clauses (b) through (i)
above, subject to Section 1.3(b), Agent agrees on reasonable
prior written notice to release its Lien on such assets or
other properties in order to permit the applicable Credit
Party to effect such disposition and shall authorize
Borrowers, at Borrowers' expense, to file appropriate UCC-3
termination statements and other releases as reasonably
requested by Borrowers."
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(h) Definitions. The definition of "EBITDA" shall be
amended by inserting the following sentence at the end of the
definition:
"Notwithstanding the foregoing, the prepayment of any
indebtedness owing to Massachusetts Mutual Life Insurance Co.
or any prepayment pursuant to 1.3(a) and (b) of this
Agreement, which would otherwise be included in EBITDA as an
operating loss, shall be excluded."
2. Waiver. In connection with Borrowers' acquisition of substantially all
of the assets of Mohajir Engineering Group, Inc. pursuant to that certain
Agreement of Sale (a copy of which has been provided to Agent) (the "Mohajir
Acquisition"), Agent and the Lenders hereby waive the requirements set forth in
Section 6.1(b) of the Credit Agreement and consent to the Mohajir Acquisition.
Borrowers hereby grant and authorize Agent to file and perfect a first priority
perfected Lien in the assets acquired in connection with the Mohajir Acquisition
and execute such documents and take such other actions as may be required by
Agent in connection therewith.
3. Conditions Precedent to Effectiveness of this Amendment. This Amendment
shall not be effective unless and until each of the following conditions shall
have been satisfied in Agent's sole discretion:
(a) Execution of Amendment. Agent, the Requisite Lenders
and each Borrower shall have executed and delivered this Amendment to
Agent.
(b) Fee. Borrowers shall have paid to Agent, for the
ratable benefit of the Lenders signatory hereto, a modification fee of
$105,000.00 shared on a pro rata basis.
(c) Payment of Expenses. Borrowers shall have paid Agent
and Lenders all of Agent's and each Lender's costs and expenses
(including attorneys' fees) incurred in connection with the negotiation
and preparation of this Amendment, and all other unpaid expenses owned
by Borrowers to Agent under and pursuant to the Credit Agreement.
(d) Resolution/Good Standing. Borrowers shall deliver to
Agent resolutions of each of the Borrower's approving and consenting to
the execution of this Amendment as well as good standing certificates
for each of the Borrowers from their state of formation.
(e) Delivery of IDS Documents. IDS shall deliver to Agent
the Joinder Agreement, the Member's Certificate, the Manager's
Certificate, the resolutions and the Incumbency Certificate of IDS and
any amendments to the schedules of the Credit Agreement or the Security
Agreement.
(f) Delivery of Layne Pledge Amendment. Layne shall
deliver to Agent the Amendment to Pledge Agreement evidencing and
pledging to Agent Xxxxx'x membership interest in 35% of IDS.
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(g) Delivery of Xxxxxx Pledge Amendment. Xxxxxx shall
deliver to Agent the Pledge Agreement evidencing and pledging Xxxxxx'
membership interest in 65% of IDS.
4. Representations and Warranties. Borrowers hereby, jointly and
severally, represent and warrant to Agent as follows:
(a) Recitals. The Recitals in this Amendment are true and
correct in all respects.
(b) Incorporation of Representations. All representations
and warranties of the Borrowers in the Credit Agreement are
incorporated herein in full by this reference and, except with respect
to representations and warranties that were made as of and limited to a
specific date, are true and correct as of the date hereof.
(c) Corporate Power; Authorization. Borrowers have the
corporate or organizational power, and have been duly authorized by all
requisite action (corporate or otherwise), to execute and deliver this
Amendment and to perform their obligations hereunder and thereunder.
This Amendment has been duly executed and delivered by each of the
Borrowers.
(d) Enforceability. This Amendment is the legal, valid
and binding obligation of Borrowers, enforceable against each Borrower
in accordance with its terms.
(e) No Violation. The execution, delivery and performance
of this Amendment by each of the Borrowers does not and will not (i)
violate any law, rule, regulation or court order to which any Borrower
is subject; (ii) conflict with or result in a breach of any Borrower's
Articles of Incorporation, Bylaws, or other organizational documents or
any agreement or instrument to which any Borrower is party or by which
it or its properties are bound, or (iii) result in the creation or
imposition of any lien, security interest or encumbrance on any
property of any Borrower, whether now owned or hereafter acquired,
other than liens in favor of Agent.
(f) Obligations Absolute. The obligation of Borrowers to
repay the Loans, together with all interest accrued thereon, is
absolute and unconditional, and there exists no right of set off or
recoupment, counterclaim or defense of any nature whatsoever to payment
of the Loans.
(g) Default. No Default or Event of Default exists under
the Credit Agreement or the Loan Documents.
5. Effect and Construction of Amendment. Except as expressly provided
herein, the Credit Agreement and the Loan Documents shall remain in full force
and effect in accordance with their respective terms, and this Amendment shall
not be construed to:
(a) impair the validity, perfection or priority of any
lien or security interest securing the Notes;
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(b) waive or impair any rights, powers or remedies of
Agent or the Lenders under the Loan Documents;
(c) constitute an election of remedies to the exclusion
of any other remedies;
(d) constitute an agreement by Agent or the Lenders or
require Agent or the Lenders to waive any Defaults or Events of Default
or extend the term of the Credit Agreement or the time for payment of
any of the Loans; or
(e) make any further Loans or other extensions of credit
to Borrowers.
6. Release of Claims and Waiver. Borrowers hereby release, remise, acquit
and forever discharge Agent and the Lenders and Agent's and Lenders' employees,
agents, representatives, consultants, attorneys, fiduciaries, servants,
officers, directors, partners, predecessors, successors and assigns, subsidiary
corporations, parent corporations, and related corporate divisions (all of the
foregoing hereinafter called the "Released Parties"), from any and all actions
and causes of action, judgments, executions, suits, debts, claims, demands,
liabilities, obligations, damages and expenses of any and every character, known
or unknown, direct and/or indirect, at law or in equity, of whatsoever kind or
nature, whether heretofore or hereafter arising, for or because of any matter or
things done, omitted or suffered to be done by any of the Released Parties prior
to and including the date of execution hereof, and in any way directly or
indirectly arising out of or in any way connected to this Amendment, the Credit
Agreement and the Loan Documents, including but not limited to, claims relating
to any settlement negotiations (all of the foregoing hereinafter called the
"Released Matters"). Borrowers acknowledge that the agreements in this paragraph
are intended to be in full satisfaction of all or any alleged injuries or
damages arising in connection with the Released Matters. Borrowers represent and
warrant to Agent that it has not purported to transfer, assign or otherwise
convey any right, title or interest of Borrowers in any Released Matter to any
other Person and that the foregoing constitutes a full and complete release of
all Released Matters.
7. Costs and Expenses. The Borrowers hereby reaffirm their agreement under
the Credit Agreement to pay or reimburse Agent on demand for all costs and
expenses incurred by Agent in connection with the Credit Agreement, the
Collateral Documents and all other documents contemplated thereby, including
without limitation all reasonable fees and disbursements of legal counsel.
Without limiting the generality of the foregoing, the Borrowers specifically
agree to pay all fees and disbursements of counsel to Agent and Lenders for the
services performed by such counsel in connection with the preparation of this
Amendment and the documents and instruments incidental hereto. The Borrowers
hereby agree that Agent may, at any time or from time to time in its sole
discretion and without further authorization by the Borrowers, make a loan to
the Borrowers under the Credit Agreement, or apply the proceeds of any loan, for
the purpose of paying any such fees, disbursements, costs and expenses.
8. Miscellaneous.
(a) Further Assurances. Borrowers agree to execute such
other and further documents and instruments as Agent may reasonably
request to implement the provisions of this Amendment and to perfect
and protect the liens and security interests created by the Credit
Agreement.
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(b) Benefit of Agreement. This Amendment shall be binding
upon and inure to the benefit of and be enforceable by the parties
hereto, their respective successors and assigns. No other person or
entity shall be entitled to claim any right or benefit hereunder,
including, without limitation, the status of a third-party beneficiary
of this Amendment.
(c) Entire Agreement. Except as expressly set forth
herein, there are no agreements or understandings, written or oral,
between Borrowers or Agent relating to this Amendment, the Credit
Agreement or the other Loan Documents that are not fully and completely
set forth herein or therein.
(d) Severability. The provisions of this Amendment are
intended to be severable. If any provisions of this Amendment shall be
held invalid or unenforceable in whole or in part in any jurisdiction,
such provision shall, as to such jurisdiction, be ineffective to the
extent of such invalidity or enforceability without in any manner
affecting the validity or enforceability of such provision in any other
jurisdiction or the remaining provisions of this Amendment in any
jurisdiction.
(e) Governing Law. This Amendment shall be governed by
and construed in accordance with the internal substantive laws of the
State of New York, without regard to the choice of law principles of
such state.
(f) Counterparts; Facsimile Signatures. This Amendment
may be executed in any number of counterparts and by different parties
to this Amendment on separate counterparts, each of which, when so
executed, shall be deemed an original, but all such counterparts shall
constitute one and the same agreement. Any signature delivered by a
party by facsimile transmission shall be deemed to be an original
signature hereto.
(g) Notices. Any notices with respect to this Amendment
shall be given in the manner provided for in the Credit Agreement.
(h) Survival. The provisions set forth in Section 6 above
shall survive the payment in full of the Notes.
(i) Amendment. No amendment, modification, rescission,
waiver or release of any provision of this Amendment shall be effective
unless the same shall be in writing and signed by the parties hereto.
(j) References. All references in the Credit Agreement
shall be deemed to refer to the Credit Agreement as amended hereby; and
any and all references in the Security Documents to the Credit
Agreement shall be deemed to refer to the Credit Agreement as amended
hereby.
(k) No Other Waiver. The execution of this Amendment and
acceptance of any documents related hereto shall not be deemed to be a
waiver of any Default or Event of Default under the Credit Agreement or
breach, default or event of default under any Loan Document or other
document held by Agent, whether or not known to Agent or any Lender and
whether or not existing on the date of this Amendment.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the day and year first above written.
XXXXX XXXXXXXXXXX COMPANY, a
Delaware corporation
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President - Finance
XXXXXX BROS. DRILLING COMPANY, a
Utah corporation
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
XXXXXXXXXXX XXXXXX CORPORATION, a
Delaware corporation
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
INTERNATIONAL DIRECTIONAL
SERVICES, L.L.C. a Delaware limited
liability company
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
LAYNE WATER DEVELOPMENT AND
STORAGE, LLC, a Delaware limited liability
company
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Treasurer
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LAYNE TEXAS, INCORPORATED, a Delaware
corporation
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
MID-CONTINENT DRILLING COMPANY, a
Delaware corporation
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
SHAWNEE OIL & GAS, L.L.C., a limited
liability company
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
XXXXX-XXXXXXX INCORPORATED, a
Louisiana corporation
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
TOLEDO OIL & GAS SERVICES, INC., a
Louisiana corporation
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
VIBRATION TECHNOLOGY, INC., a
Delaware corporation
By: /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President and Treasurer
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GENERAL ELECTRIC CAPITAL
CORPORATION,
as Agent and Lender
By: /s/ Xxx Xxxxxx
-----------------------------------------
Duly Authorized Signatory
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LASALLE BANK NATIONAL ASSOCIATION,
as Revolving Credit Agent and Lender
By: /s/ Xxxxx X. Xxxx
-----------------------------------------
Xxxxx X. Xxxx
First Vice President
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U.S. BANK NATIONAL ASSOCIATION,
as Lender
By: /s/ Xxxx X. Xxxxx
-----------------------------------------
Xxxx X. Xxxxx
Vice President
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XXXXXX TRUST AND SAVINGS BANK
as Lender
By: /s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Managing Director
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FIRST NATIONAL BANK OF KANSAS,
as Lender
By: /s/ Xxxx X. Xxxxxx
-----------------------------------------
Xxxx X. Xxxxxx
Senior Vice President
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