EXHIBIT 10.11
AMENDMENT NO. 1 AND CONSENT AND WAIVER
This Amendment No. 1 dated as of March 29, 1999 ("Agreement") is among
Tuboscope Inc., a Delaware corporation ("Borrower"), the banks party to the
Amended and Restated Credit Agreement described below ("Lenders"), ABN AMRO Bank
N.V., as administrative agent for the Lenders ("Administrative Agent").
INTRODUCTION
A. The Borrower, the Administrative Agent and the Lenders are parties to
the Amended and Restated Credit Agreement dated as of February 9, 1998 ("Credit
Agreement").
B. The Borrower has requested, and the Lenders have agreed, to make
certain amendments to the Credit Agreement and waive certain provisions thereof.
Therefore, the Borrower, the Administrative Agent and the Lenders hereby
agree as follows:
Section 1. Definitions; References. Unless otherwise defined in this
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Agreement, terms used in this Agreement which are defined in the Credit
Agreement shall have the meanings assigned to such terms in the Credit
Agreement.
Section 2. Amendments to Credit Agreement.
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(a) Section 1.1. The definition of "Applicable Margin contained in Section
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1.1 is deleted in its entirety and replaced with the following:
"Applicable Margin" means, for any day, at such times as the relevant Total
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Funded Debt to Total Capital Ratio is in one of the following ranges, the
percentage per annum set forth opposite such Total Funded Debt to Total
Capital Ratio:
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Total Funded Debt to
Total Capital Ratio Percentage
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Less than 30% 0.95%
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Equal to or greater than 30% 1.000%
but less than 35%
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Equal to or greater than 35% 1.075%
but less than 37.5%
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Equal to or greater than 37.5% 1.125%
but less than 40%
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Equal to or greater than 40% 1.250%
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The Borrower shall give written notice to the Agent of any change to the Total
Funded Debt to Total Capital Ratio affecting the Applicable Margin within three
(3) Business Days thereof and any change to the Applicable Margin shall be
effective one (1) day thereafter.
(b) Section 6.22. Section 6.22 is deleted in its entirety and is replaced
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by the following:
Section 6.22. Interest Coverage Ratio. The Borrower will not permit
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the Interest Coverage Ratio at any time to be less than (i) 1.90 to 1.00
for the fiscal quarter ended March 31, 1999; (ii) 1.60 to 1.00 for the
fiscal quarters ended June 30, 1999 and September 30, 1999; (iii) 2.00 to
1.00 for the fiscal quarter ended December 31, 1999; (iv) 2.25 to 1.00 for
the fiscal quarter ended March 31, 2000; and (v) 2.50 to 1.00 for all
fiscal quarters ending thereafter.
(c) Section 6.23. Section 6.23 is deleted in its entirety and is replaced
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by the following:
Section 6.23. Total Funded Debt to Total Capital Ratio. The Borrower
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will maintain a ratio of Total Funded Debt to Total Capital of (i) no
greater than 45% during the period from January 1, 1999 through June 30,
2000 and (ii) no greater than 40% during the period from July 1, 2000 until
the final Maturity Date for all Loans.
Section 3. Consent and Waiver.
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(a) Section 6.12(b) of the Credit Agreement permits the Borrower and its
Subsidiaries to redeem, purchase or otherwise acquire up to
$15,000,000 of its capital stock during the period from January 1,
1998 through December 31, 1998. During the period from January 1, 1998
through December 31, 1998, the Borrower inadvertently exceeded the
$15,000,000 maximum by approximately $300,000.
(b) Each of the Agent and the Lenders hereby waive any Defaults or Events
of Default that may have arisen as a result of the Borrower's
exceeding the $15,000,000 limitation described in clause (a) above.
This waiver is limited to the extent described herein and shall not be
construed to be a consent to or a waiver of any other Defaults or
Events of Default arising under the provisions of the Credit Agreement
and the other Credit Documents, including without limitation, the
provisions contained in Section 6.12(b).
Section 4. Representations and Warranties. The Borrower represents and
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warrants to the Administrative Agent and the Lenders that:
(a) Each of the representations and warranties of the Borrower and its
Subsidiaries set forth in the Credit Agreement and in the other Credit Documents
are true and correct in all material respects as of the date of this Agreement,
except to the extent that any such representation or warranty relates solely to
an earlier date, in which case it shall have been true and correct in all
material respects as of such earlier date;
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(b) (i) The execution, delivery and performance of this Agreement are
within the corporate power and authority of the Borrower and have been duly
authorized by appropriate proceedings and (ii) this Agreement constitutes a
legal, valid, and binding obligation of the Borrower enforceable in accordance
with its terms, except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting the rights of creditors
generally and general principles of equity;
(c) As of the effectiveness of this Agreement, no Default or Event of
Default has occurred and is continuing;
Section 5. Effectiveness. This Agreement shall become effective and the
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Credit Agreement shall be amended as provided in this Agreement upon the
occurrence of the following conditions precedent:
(a) The Borrower, the Administrative Agent and the Majority Lenders shall
have delivered duly and validly executed originals of this Agreement to the
Administrative Agent;
(b) the representations and warranties in this Agreement shall be true and
correct in all material respects;
(c) each of the Guarantors shall have executed and delivered a
reaffirmation of its Subsidiary Guaranty Agreement in form and substance
satisfactory to the Administrative Agent and the Majority Lenders;
(d) the Borrower shall have delivered an opinion of its counsel in form
and substance satisfactory to the Administrative Agent;
(e) the Borrower and the Guarantors shall have delivered such other
documents, certificates and opinions as the Administrative Agent may reasonably
request;
(f) the Borrower shall have paid (i) to each Lender which signed this
Agreement on or before March 29, 1999, an amendment fee in an amount equal to
.25% multiplied by such Lender's Commitment and (ii) to the Administrative
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Agent, all expenses required to be paid in connection with this Agreement and
the amendments evidenced hereby.
Section 6. Effect on Loan Documents.
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(a) Except as amended herein, the Credit Agreement and the Credit
Documents shall remain in full force and effect as originally executed. Nothing
herein shall act as a waiver of any of the Administrative Agent's or any
Lenders' rights under the Credit Documents, as amended, including the waiver of
any Default or Event of Default except as specifically provided for herein.
(b) This Agreement is a Credit Document for the purposes of the provisions
of the other Credit Documents. Without limiting the foregoing, any breach of
representations, warranties, and
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covenants under this Agreement may be a Default or Event of Default under other
Credit Documents.
Section 7. Choice of Law. This Agreement shall be governed by and
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construed and enforced in accordance with the laws of the State of New York.
Section 8. Counterparts. This Agreement may be signed in any number of
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counterparts, each of which shall be an original.
EXECUTED as of the 29th day of March, 1999.
TUBOSCOPE INC., as Borrower
By:_____________________________________
Name:__________________________________
Title:_________________________________
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ABN AMRO BANK N.V., as Administrative Agent,
as Issuing Bank, and as a Bank
By:_________________________________________
Name:______________________________________
Title:_____________________________________
By:_________________________________________
Name:______________________________________
Title:_____________________________________
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XXXXX XXXX XX XXXXX,
NATIONAL ASSOCIATION
By:_______________________________________
Name:____________________________________
Title:___________________________________
XXXXX FARGO BANK (TEXAS),
NATIONAL ASSOCIATION
By:_______________________________________
Name:____________________________________
Title:___________________________________
THE BANK OF NOVA SCOTIA,
ATLANTA AGENCY
By:________________________________________
Name:_____________________________________
Title:____________________________________
ARAB BANKING CORPORATION (B.S.C.)
By:_________________________________________
Name:______________________________________
Title:_____________________________________
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By:_________________________________________
Name:______________________________________
Title:_____________________________________
CREDIT SUISSE FIRST BOSTON
By:_________________________________________
Name:______________________________________
Title:_____________________________________
CREDIT LYONNAIS NEW YORK BRANCH
By:_________________________________________
Name:______________________________________
Title:_____________________________________
THE FUJI BANK, LIMITED
By:________________________________________
Name:_____________________________________
Title:____________________________________
HIBERNIA NATIONAL BANK
By:________________________________________
Name:_____________________________________
Title:____________________________________
BANK ONE, LOUISIANA, N.A.
By:_________________________________________
Name:______________________________________
Title:_____________________________________
