THIRD AMENDMENT TO CREDIT AND SECURITY AGREEMENT
EXHIBIT
10.19
THIRD AMENDMENT
TO CREDIT AND SECURITY AGREEMENT
THIS
THIRD AMENDMENT TO CREDIT AND SECURITY AGREEMENT
(this
“Amendment”),
dated
as of March 20, 2007, is made by and between IWC
SERVICES, LLC,
a Texas
limited liability company (“Borrower”)
and
XXXXX
FARGO BANK,
National Association (“Lender”),
acting through its XXXXX
FARGO BUSINESS CREDIT
operating division.
RECITALS
Borrower,
Boots & Xxxxx International Well Control, Inc. (“BNC”)
and
Lender are parties to the Credit and Security Agreement dated as of
March 3, 2006 (as amended, restated, amended and restated or extended from
time to time, the “Credit
Agreement”).
Borrower
has requested that certain amendments be made to the Credit Agreement as more
particularly set forth herein, which Lender is willing to make pursuant to
the
terms and conditions set forth herein.
NOW,
THEREFORE, in consideration of the premises and of the mutual covenants and
agreements herein contained, it is agreed as follows:
1. Amendments
to the Credit Agreement.
Effective as of December 31, 2006 upon satisfaction of the Conditions Precedent,
the Credit Agreement shall be amended as
follows:
(a) Section
1.1
of the
Credit Agreement shall be amended by adding the following new definition in
its
proper alphabetical order:
“’Eligible
Joint Venture’
means
any joint venture proposed to be entered into by any Credit Party, provided
that (i)
the terms of which shall have been furnished to Lender in writing prior to
the
effectiveness thereof, (ii) upon the reasonable request of Lender and if the
joint venture relationship is or will be governed by the laws of the United
States or any political subdivision thereof, such Credit Party shall pledge
its
ownership interests in such joint venture to Lender as additional Collateral
for
the Obligations, and (iii) prior to or simultaneous with any contribution to
such joint venture of Eligible Equipment or any other Equipment financed with
an
Equipment Term Advance, Borrower shall prepay the Equipment Term Note by an
amount equal to at least eighty percent (80%) of the value of such Equipment
as
set forth in the most recent appraisal delivered to Lender in accordance with
this Agreement.”
(b) Section
2.4(a)(i)
of the
Credit Agreement shall be amended to replace “$1,000,000” with
“$2,000,000.”
(c) Section
6.2(c)
of the
Credit Agreement shall be amended and restated, in its entirety, to read as
follows:
(c) Capital
Expenditures.
BNC and
its Subsidiaries, including Borrower, will notify Lender within five (5)
Business Days of making any Capital Expenditure exceeding $500,000, and such
notice shall include sufficient detail to describe the amount expended and
the
asset or assets acquired pursuant to such expenditure.
(d) Section
6.6(b)
of the
Credit Agreement shall be amended and restated, in its entirety, to read as
follows:
(b) Travel
advances or loans to Borrower’s Officers and employees not exceeding at any one
time (i) an aggregate of $45,000 per occurrence per Person, or
(ii) $450,000 in the aggregate outstanding at any time;
(e) Section
6.6(c)
of the
Credit Agreement shall be amended and restated, in its entirety, to read as
follows:
(c) Prepaid
rent or security deposits made in the ordinary course of business and in
accordance with generally accepted commercial business practices;
(f) Section
6.6
of the
Credit Agreement further shall be amended to replace the punctuation xxxx “.” in
paragraph (d) thereof with “; and”, and to add a new paragraph (e) which shall
read as follows:
(e) Investments
in Eligible Joint Ventures.
(g) The
first
sentence of Section
6.17
of the
Credit Agreement shall be amended and restated, in its entirety, to read as
follows:
BNC
and
Borrower will not, and will not permit any other Credit Party to, sell, lease,
assign, transfer or otherwise dispose of (i) the stock of any Subsidiary
(other than Director’s qualifying shares issued in BNC or shares of a Foreign
Subsidiary (that do not dilute or affect Lender’s pledge of the Equity Interests
in the Foreign Subsidiary) required or deemed advisable to be issued to a
foreign national in connection with any Foreign Subsidiary), (ii) all or a
substantial part of its assets (a “substantial
part”
shall
be triggered if the value of any contemplated sale, lease, assignment, transfer
or other disposition when aggregated all other similar transactions occurring
in
any fiscal year would exceed five percent (5%) of the then applicable Book
Net
Worth), or (iii) any Collateral or any interest therein (whether in one
transaction or in a series of transactions) to any other Person other than
the
sale of Inventory in the ordinary course of business or the disposition of
(a)
Equipment (other than Eligible Equipment or any other Equipment financed with
an
Equipment Term Advance) that is used, obsolete, worn out or surplus (the
proceeds of which shall be paid to reduce the Obligations unless used
immediately for the purchase of like Equipment) or (b) Equipment contributed
by
any Credit Party to an Eligible Joint Venture and will not liquidate, dissolve
or suspend business operations, except that any Subsidiary that is an Inactive
Subsidiary may liquidate or dissolve if (i) BNC determines in good faith
that such liquidation or dissolution is in the best interests of BNC, (ii)
the
liquidation or dissolution shall not have a Material Adverse Effect, and
(iii) any assets of the Inactive Subsidiary are distributed to
Borrower.
-
2
-
2. No
Other Changes.
Except
as explicitly amended by this Amendment, all of the terms and conditions of
the
Credit Agreement and the other Loan Documents shall remain in full force and
effect.
3. Conditions
Precedent.
This
Amendment shall be effective when Lender shall have received an executed
original hereof, together with each of the following, each in substance and
form
acceptable to Lender in its sole discretion (these conditions being
collectively, the “Conditions
Precedent”):
(a) Originals
of the Acknowledgment and Agreement of Guarantors and the Acknowledgment and
Agreement of Subordinated Creditor set forth at the end of this Amendment,
duly
executed by each Guarantor and the Subordinated Creditor.
(b) All
representations and warranties made under this Amendment shall be true, correct
and complete.
(c) In
consideration for entering into this Amendment, Lender shall have received
from
Borrower in immediately available funds an amendment fee of $10,000, which
fee
shall be duly earned and nonrefundable upon execution of this
Amendment.
(d) Such
other matters as Lender may require in its Permitted Discretion.
4. Representations
and Warranties.
Borrower hereby represents and warrants to Lender as follows:
(a) Borrower
and each Guarantor have all requisite power and authority to execute this
Amendment and the Acknowledgement and Agreement of Guarantors, as applicable
and
to perform all of their obligations under this Amendment and the Acknowledgement
and Agreement of Guarantors, and this Amendment and the Acknowledgement and
Agreement of Guarantors have been duly executed and delivered by Borrower and
the Guarantors, as applicable, and constitute the
legal, valid and binding obligations of such parties, enforceable in accordance
with their respective terms.
(b) The
execution, delivery and performance by Borrower and Guarantors of this Amendment
and the Acknowledgement and Agreement of Guarantors have been duly authorized
by
all necessary action and do not (i) require any authorization, consent or
approval by any governmental department, commission, board, bureau, agency
or
instrumentality, domestic or foreign, (ii) violate any provision of any
law, rule or regulation or of any order, writ, injunction or decree presently
in
effect, having applicability to Borrower or any Guarantor, or any governing
document of Borrower or any Guarantor, or (iii) result in a breach of or
constitute a default under any indenture or loan or credit agreement or any
other agreement, lease or instrument to which Borrower or any Guarantor is
a
party or by which it or its properties may be bound or affected.
-
3
-
(c) No
Default or Event of Default exists under the Credit Agreement before or after
giving effect to this Amendment.
(d) All
of
the representations and warranties contained in Article V of the Credit
Agreement are correct on and as of the date hereof as though made on and as
of
such date, except to the extent that such representations and warranties relate
solely to an earlier date.
5. References.
All
references in the Credit Agreement to “this 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.
6. 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 Security Document
or
other document held by Lender, whether or not known to Lender and whether or
not
existing on the date of this Amendment.
7. Ratification.
Except
as specifically amended hereby, the Credit Agreement and the other Loan
Documents shall remain in full force and effect and hereby are ratified and
confirmed by Borrower and each Guarantor as so amended. Borrower and each
Guarantor hereby ratify and confirm all of the Obligations pursuant to the
Credit Agreement and other Loan Documents to which it is a party and confirm
and
ratify the liens and security interests granted in favor of Lender in the
Collateral to secure the repayment and performance of all
Obligations.
8. Release.
BORROWER, AND EACH GUARANTOR BY SIGNING THE ACKNOWLEDGMENT AND AGREEMENT OF
GUARANTORS SET FORTH BELOW, EACH HEREBY ABSOLUTELY AND UNCONDITIONALLY RELEASES
AND FOREVER DISCHARGES LENDER, AND ANY AND ALL PARTICIPANTS, PARENT
CORPORATIONS, SUBSIDIARY CORPORATIONS, AFFILIATED CORPORATIONS, INSURERS,
INDEMNITORS, SUCCESSORS AND ASSIGNS THEREOF, TOGETHER WITH ALL OF THE PRESENT
AND FORMER DIRECTORS, OFFICERS, ATTORNEYS, AGENTS AND EMPLOYEES OF ANY OF THE
FOREGOING, FROM ANY AND ALL CLAIMS, DEMANDS OR CAUSES OF ACTION OF ANY KIND,
NATURE OR DESCRIPTION, WHETHER ARISING IN LAW OR EQUITY OR UPON CONTRACT OR
TORT
OR UNDER ANY STATE OR FEDERAL LAW OR OTHERWISE, WHICH BORROWER OR SUCH GUARANTOR
HAS HAD, NOW HAS OR HAS MADE CLAIM TO HAVE AGAINST ANY SUCH PERSON FOR OR BY
REASON OF ANY ACT, OMISSION, MATTER, CAUSE OR THING WHATSOEVER ARISING FROM
THE
BEGINNING OF TIME TO AND INCLUDING THE DATE OF EXECUTION OF THIS AMENDMENT,
WHETHER SUCH CLAIMS, DEMANDS AND CAUSES OF ACTION ARE MATURED OR UNMATURED
OR
KNOWN OR UNKNOWN, INCLUDING,
WITHOUT LIMITATION, ALL CLAIMS, DEMANDS OR CAUSES OF ACTION ARISING IN WHOLE
OR
PART FROM THE NEGLIGENCE OR STRICT LIABLITY OF LENDER OR ANY OTHER RELEASED
PARTY.
-
4
-
9. Severability.
If any
term or provision of this Amendment is adjudicated to be invalid under
applicable laws or regulations, such provision shall be inapplicable to the
extent of such invalidity without affecting the validity or enforceability
of
the remainder of this Amendment which shall be given effect so far as
possible.
10. Binding
Effect.
This
Amendment shall be binding upon and inure to the benefit of Borrower and Lender
and their respective successors and assigns, except that Borrower shall not
have
the right to assign any rights thereunder or any interest therein without
Lender’s prior written consent.
11. Costs
and Expenses.
Borrower hereby reaffirms its agreement under the Credit Agreement to pay or
reimburse Lender on demand for all costs and expenses incurred by Lender in
connection with the Loan Documents, including without limitation all reasonable
fees and disbursements of legal counsel. Without limiting the generality of
the
foregoing, Borrower specifically agrees to pay all fees and disbursements of
counsel to Lender for the services performed by such counsel in connection
with
the preparation of this Amendment and the documents and instruments incidental
hereto. Borrower hereby agrees that Lender may, at any time or from time to
time
in its sole discretion and without further authorization by Borrower, make
a
loan to Borrower under the Credit Agreement, or apply the proceeds of any loan,
for the purpose of paying any such fees, disbursements, costs and
expenses.
12. Miscellaneous.
This
Amendment, the Acknowledgment and Agreement of Guarantors and the Acknowledgment
and Agreement of Subordinated Creditor (i) may
be
executed in any number of counterparts, each of which when so executed and
delivered shall be deemed an original and all of which counterparts, taken
together, shall constitute one and the same instrument and
(ii) AND
THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND
MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES, AND THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG
THE
PARTIES.
Capitalized terms used in this Amendment and the Acknowledgments attached hereto
have the meanings given to them in the Credit Agreement unless otherwise
specified. This Amendment shall be governed and construed in accordance with
the
laws of the State of Texas.
[SIGNATURE
PAGE FOLLOWS]
-
5
-
IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed as of the date first written above.
| IWC SERVICES, LLC, a Texas limited liability company | ||
|
By:
|
/s/
Xxxxx Xxxxxxxxxx
|
|
| Name: Xxxxx Xxxxxxxxxx | ||
| Title: President and CEO | ||
| XXXXX FARGO BANK, NATIONAL ASSOCIATION, acting through its Xxxxx Fargo Business Credit operating division | ||
|
By:
|
/s/
Xxxx Xxxxxxxxx
|
|
| Name: Xxxx Xxxxxxxxx | ||
| Title: Vice President | ||
ACKNOWLEDGMENT
AND AGREEMENT OF GUARANTORS
Each
undersigned, each a guarantor of the indebtedness and other obligations of
Borrower to Lender pursuant to a separate Guaranty each dated as of March 3,
2006 (each a “Guaranty”),
hereby (i) acknowledges receipt of the foregoing Amendment; (ii) consents
to the terms (including without limitation the release set forth in Section
8
of the
Amendment) and execution thereof; (iii) reaffirms its obligations to Lender
pursuant to the terms of its Guaranty; and (iv) acknowledges that Lender
may amend, restate, extend, renew or otherwise modify the Credit Agreement
and
any indebtedness or agreement of Borrower, or enter into any agreement or extend
additional or other credit accommodations, without notifying or obtaining the
consent of the undersigned and without impairing the liability of the
undersigned under its Guaranty for all of Borrower’s present and future
indebtedness and other obligations to Lender.
BOOTS
& XXXXX INTERNATIONAL WELL CONTROL, INC.
BOOTS
& XXXXX SERVICES, INC.
BOOTS
& XXXXX SPECIAL SERVICES, INC.
ELMAGCO,
INC.
HELL
FIGHTERS, INC.
HWC
LIMITED
IWC
ENGINEERING, INC.
|
By:
|
/s/
Xxxxx Xxxxxxxxxx
|
|
| Name: Xxxxx Xxxxxxxxxx | ||
| Title: President and CEO of each entity above | ||
ACKNOWLEDGMENT
AND AGREEMENT OF SUBORDINATED CREDITORS
The
undersigned, a subordinated creditor of BNC pursuant to each Senior Subordinated
Promissory Note, hereby (i) acknowledges receipt of the foregoing Amendment;
(ii) consents to the terms and execution thereof; (iii) reaffirms the
terms of each Senior Subordinated Promissory Note; and (iv) acknowledges
that Lender may amend, restate, extend, renew or otherwise modify the Loan
Documents and any indebtedness or agreement of Borrower or enter into any
agreement or extend additional or other credit accommodations (in each case
subject to any limitations set forth in the respective Senior Subordinated
Promissory Note), without notifying or obtaining the consent of the undersigned
except as may be expressly required under the terms of each Senior Subordinated
Promissory Note.
OIL
STATES ENERGY SERVICES, INC.
(formerly
known as HWC Energy Services, Inc.)
|
By:
|
/s/ Xxxxx X. Xxxxxx | |
|
Xxxxx X. Xxxxxx, President
|
