EXHIBIT 10.12
AMENDED AND RESTATED
SECURITY AGREEMENT
This Amended and Restated Security Agreement (this
"Agreement"), dated as of January 31, 2002, is executed by and among NEWPARK
RESOURCES, INC., as Borrower, by EXCALIBAR MINERALS INC., MALLARD & MALLARD OF
LA., INC., NEWPARK HOLDINGS, INC., SUPREME CONTRACTORS, L.L.C., NEWPARK DRILLING
FLUIDS, LLC, NEWPARK ENVIRONMENTAL SERVICES, L.L.C., NEWPARK ENVIRONMENTAL
MANAGEMENT COMPANY, L.L.C., NEWPARK TEXAS, L.L.C., EXCALIBAR MINERALS OF LA.,
L.L.C., SOLOCO, L.L.C., XXXXXX MILL, L.P., NEWPARK ENVIRONMENTAL SERVICES OF
TEXAS, L.P., NEWPARK SHIPHOLDING TEXAS, L.P., NID, L.P., SOLOCO TEXAS, L.P., NES
PERMIAN BASIN, L.P., and NEWPARK ENVIRONMENTAL SERVICES MISSISSIPPI, L.P. (the
Borrower and such other entities the "Grantors" and each a "Grantor") and BANK
ONE, NA, as Administrative Agent for the benefit of the Administrative Agent,
the Lenders and their Affiliates and the LC Issuer pursuant to the Credit
Agreement referred to below.
RECITALS:
A. Pursuant to that certain Amended and Restated Credit
Agreement dated January 31, 2001 as amended (as so amended, the "Original Credit
Agreement") by and among Newpark Resources, Inc. as Borrower, the other Grantors
as Guarantors, Bank One, NA, as Administrative Agent and LC Issuer, and the
Lenders party thereto, the Grantors executed a certain Amended and Restated
Security Agreement dated January 31, 2001 (the "Original Security Agreement").
B. The Borrower, the other Grantors as Guarantors, and Bank
One, N.A. as Administrative Agent and the LC Issuer and the Lenders party
thereto are amending and restating the Original Credit Agreement pursuant to
that certain Amended and Restated Credit Agreement dated as of January 31, 2002
(as the same may be amended, modified or restated from time to time, the "Credit
Agreement").
C. The Grantors and the Administrative Agent desire to amend
and restate the Original Security Agreement.
D. In consideration of the financial and other support that
the Borrower has provided, and such financial and other support as the Borrower
may in the future provide, to the Grantors other than Borrower, and in order to
induce the Lenders and the LC Issuer and the Administrative Agent to enter into
the Credit Agreement, and one or more of the Lenders and their Affiliates to
enter into one or more Rate Management Transactions with the Borrower, and
because each Grantor other than Borrower has determined that executing this
Agreement is in its interest and to its financial benefit, each of the Grantors
other than Borrower is willing to grant security for the obligations of the
Borrower under the Credit Agreement, any Note, any Rate Management
Transaction between the Borrower and any Lender or Affiliate thereof, and the
other Loan Documents.
NOW THEREFORE, in consideration of the premises, the Grantors
and the Administrative Agent do hereby amend and restate the Original Security
Agreement, effective as of the Closing Date, and agree and obligate themselves
as follows:
ARTICLE 1
DEFINITIONS
Any capitalized term defined in the Credit Agreement and not
otherwise defined herein shall have the meaning given to such term in the Credit
Agreement. In addition, the following terms shall have the following meanings
when used in this Agreement:
1.1 AGREEMENT. The term "Agreement" refers to this Amended and
Restated Security Agreement as this agreement may be modified,
restated, or amended in writing from time to time, and to any
exhibits or attachments to this Agreement.
1.2 BORROWER. The term "Borrower" refers to Newpark Resources,
Inc., and its successors and assigns.
1.3 COLLATERAL. The term "Collateral" refers individually,
collectively and interchangeably to the Collateral as more
fully described in Section 2.2 of this Agreement.
1.4 GRANTOR. The term "Grantor" refers individually, collectively
and interchangeably to the above named Grantors and their
respective successors and assigns.
1.5 LC ISSUER. The term "LC Issuer" refers to Bank One, NA, as LC
Issuer under the Credit Agreement and its successors and
assigns.
1.6 LENDERS. The term "Lenders" refers individually and
collectively to the Lenders now or hereafter party to the
Credit Agreement, their successors and assigns, and any
subsequent holder or holder of any portion of Secured
Obligations.
1.8 OBLIGATIONS. The term "Obligations" means any and all existing
and future indebtedness, obligation and liability of every
kind, nature and character, direct or indirect, absolute or
contingent (including all renewals, extensions and
modifications thereof and all fees, costs and expenses
incurred by the Administrative Agent or the Lenders or the LC
Issuer in connection with the preparation, administration,
collection or enforcement thereof), of the Borrower to
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the Administrative Agent or any Lender or the LC Issuer or any
branch, subsidiary or affiliate thereof, arising under or
pursuant to this Agreement, the Credit Agreement, any
promissory note or notes now or hereafter issued under the
Credit Agreement, and the other Loan Documents, together with
all obligations of Grantors other than Borrower under the
Guaranty.
1.9 RATE MANAGEMENT TRANSACTION. The term "Rate Management
Transaction" means any transaction (including an agreement
with respect thereto) now existing or hereafter entered into
between the Borrower and any Lender or Affiliate thereof which
is a rate swap, basis swap, forward rate transaction,
commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate
option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, forward transaction, currency
swap transaction, cross-currency rate swap transaction,
currency option or any other similar transaction (including
any option with respect to any of these transactions) or any
combination thereof, whether linked to one or more interest
rates, foreign currencies, commodity prices, equity prices or
other financial measures.
1.10 RATE MANAGEMENT OBLIGATIONS. The term "Rate Management
Obligations" means any and all obligations of the Borrower,
whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all
renewals, extensions and modifications thereof and
substitutions therefor), under (i) any and all Rate Management
Transactions, and (ii) without duplication of (i), any and all
cancellations, buy backs, reversals, terminations or
assignments of any Rate Management Transactions.
1.11 SECURED OBLIGATIONS. Secured Obligations means the Obligations
and Rate Management Obligations entered into with one or more
of the Lenders or their Affiliates.
1.12 SECURED PARTIES. The term "Secured Parties" shall mean the
Administrative Agent, the Lenders and their Affiliates, the LC
Issuer, and their respective successors and assigns, and any
subsequent holder of any portion of the Secured Obligations.
1.13 UNIFORM COMMERCIAL CODE. The term "Uniform Commercial Code"
means the Uniform Commercial Code, Commercial Laws-Secured
Transactions (La. R.S. 10-9-101 et seq.) in the State of
Louisiana, as amended and in effect from time to time,
provided that if by reason of mandatory provisions of law, the
perfection or effect of perfection or non-perfection of a
security interest in the Collateral is governed by the Uniform
Commercial Code as in effect from time to time in a
jurisdiction other than the State of Louisiana, Uniform
Commercial Code means the Uniform Commercial Code as in effect
from time to time in such other jurisdiction for purpose of
the provisions hereof related to such perfection or effect of
perfection or non-perfection.
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ARTICLE 2
GRANT OF SECURITY INTEREST; COLLATERAL DESCRIPTION
2.1 GRANT OF SECURITY INTEREST: In order to secure the prompt and
punctual payment and satisfaction of the Secured Obligations, each Grantor does
by these presents hereby grant a continuing security interest in favor of the
Administrative Agent for the pro rata benefit of the Secured Parties affecting
the right, title, and interest of each Grantor in and to the Collateral. The
security interest granted in the Collateral in favor of the Administrative Agent
for the pro rata benefit of the Secured Parties will continue until such time as
all of the Secured Obligations is fully paid and satisfied, no Lender has an
obligation to extend Loans to the Borrower, all Rate Management Transactions are
terminated and all Rate Management Obligations have been paid, all Facility LCs
have terminated or expired and all Reimbursement Obligations have been paid and
this Agreement is cancelled or terminated by Administrative Agent under a
written cancellation instrument. Administrative Agent agrees to execute any and
all instruments necessary to release this security interest upon such
termination.
2.2 COLLATERAL DESCRIPTION:
(a) GENERAL EQUIPMENT: Any and all of Grantors' now owned and
hereafter acquired machinery, equipment, furniture, furnishings and fixtures, of
every type and description, and all accessories, attachments, accessions,
substitutions, replacements and additions thereto, whether added now or later,
and all proceeds derived or to be derived therefrom, including without
limitation, any equipment purchased with proceeds, and all insurance proceeds
and refunds of insurance premiums, if any, and any sums that may be due from
third parties who may cause damage to any of the foregoing, or from any insurer,
whether due to judgment, settlement or other process, and any and all present
and future accounts, chattel paper, instruments, notes and monies that may be
derived from the sale, lease or other disposition of any of the foregoing, and
any rights of each Grantor to collect or enforce payment thereof, as well as to
enforce any guaranties of the foregoing and security therefor, and all present
and future general intangibles of each Grantor in any way related or pertaining
to the ownership, operation, or use of the foregoing, and all rights of each
Grantor with regard thereto.
(b) GENERAL INVENTORY: Any and all of Grantors' present and
future inventory (including consigned inventory), related equipment, goods,
merchandise, and other items of personal property, no matter where located, of
every type and description, including without limitation, any and all Grantors'
present and future raw materials, components, work-in-process, finished items,
packing and shipping materials, containers, items held for sale, items held for
release, items for which any Grantor is lessor, goods to be furnished under
contract for services, materials used or consumed in Grantors' business, whether
held by any Grantor or by others, and all documents of title, warehouse
receipts, bills of lading, and all other documents of every type covering all or
any part of the foregoing, and any and all additions thereto and substitutions
and replacements therefor, and all accessories, attachments, and accessions
thereto, whether added now or later, and all products and proceeds derived or to
be derived therefrom,
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including without limitation, all insurance proceeds and refunds of insurance
premiums, if any, and all sums that may be due from third parties who may cause
damage to any of the foregoing, or from any insurer, whether due to judgment,
settlement or other process, and any and all present and future accounts,
contract rights, chattel paper, instruments, documents and notes that may be
derived from the sale, lease or other disposition of any of the foregoing, and
any rights of Grantors to collect or enforce payment thereof, as well as to
enforce any guaranties of the foregoing and security therefor, and all of
Grantors' present and future general intangibles in any way related or
pertaining to ownership, operation, use or collection of any of the foregoing,
including without limitation, Grantors' books, records, files, computer discs
and software, and all rights that any Grantor may have with regard thereto.
Inventory includes inventory temporarily out of Grantors' possession or custody
and all returns on accounts.
(c) GENERAL ACCOUNTS, CHATTEL PAPER AND CONTRACT RIGHTS: Any
and all of Grantors' present and future accounts, accounts receivable, other
receivables, contract rights, chattel paper, instruments, documents, notes, and
all other obligations and indebtedness that may now and in the future be owed to
any Grantor from whatever source arising, and all monies and proceeds that are
payable thereunder, and all of Grantors' rights and remedies to collect and
enforce payment and performance thereof, as well as to enforce any guaranties of
the foregoing and security therefor, and all of Grantors' present and future
rights, title and interest in and with respect to the goods, services, or other
property that may give rise to or that may secure any of the foregoing, and
Grantors' insurance rights and with regard thereto, and all present and future
general intangibles of any Grantor in any way related or pertaining to the
foregoing, including without limitation, Grantors' account ledgers, books,
records, files, computer discs and software, and all rights that Grantors may
have with regard thereto.
(d) GENERAL INTANGIBLES: All chooses in action and causes of
action and all other intangible personal property of Grantors of every nature
and kind, now owned or hereafter acquired, including without limitation,
corporate or other business records, inventions, designs, blueprints, plans,
specifications, patent, patent applications, trademarks, trade names, trade
secrets, goodwill, copyrights, registrations, licenses, franchises, tax refund
claims, insurance proceeds, including without limitation, and any letter of
credit, guaranty, claim, security interest or other security held or granted to
any Grantor to secure payment of any indebtedness.
(e) INVESTMENTS: All stock, limited liability membership
interests, interests in partnerships, joint ventures and other entities, and
other equity interests (hereinafter, collectively "Equity Interests") now or
hereafter owned by Borrower, directly or indirectly, in or of any other Grantor,
together with any additional Equity Interests in or of any other Grantor issued
hereafter as dividends, splits, reclassifications, or otherwise, or Equity
Interests received as a result of any merger or consolidation of any other
Grantor, all cash, liquidation and other dividends now or hereafter declared
thereon, all redemption payments and all other monies due or to become due
thereunder, all warrants, options, pre-emptive rights, rights of first refusal,
and other rights to subscribe to, purchase or receive any shares of common stock
or other securities or Equity Interests now or hereafter incident thereto or
declared or granted in connection therewith, and all distributions (whether made
in cash, instruments, income, or other property) made or to be made in
connection therewith or incident thereto, and all proceeds of all or any of the
foregoing, in whatever form, and all proceeds of such proceeds.
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(f) EXCLUSION: Notwithstanding the foregoing, the "Collateral"
shall not include the following property: (i) that certain promissory note dated
August 29, 1996 in the original principal amount of $8,534,000 executed by
Newpark Shipbuilding and Repair Inc. to Newpark Shipholding Texas, L.P., and
(ii) all Series B Convertible Preferred and Series C Redeemable Preferred Stock
of Environmental Safeguards, Inc. now or hereafter registered in the name of
Borrower.
2.3 UNIFORM COMMERCIAL CODE. Notwithstanding the foregoing description
of each item of Collateral, each Grantor acknowledges and agrees that Secured
Parties' security interest in each item of Collateral shall cover such item as
such items of Collateral are defined in the Uniform Commercial Code.
2.4 LOCATION OF COLLATERAL. Secured Parties' security interest will
affect the Collateral wherever located.
2.5 DEPOSIT ACCOUNTS: As additional collateral security for repayment
of the Secured Obligations, each Grantor hereby grants Secured Parties a
continuing security interest in any and all present or future funds that
Grantors may have on deposit with Lenders and in certificates of deposit and
other deposit accounts as to which any Grantor is an account holder (with the
exception of XXX, pension and other tax-deferred deposits). Upon the occurrence
of a Default (as hereinafter defined), Secured Parties may apply any funds that
Grantors may have on deposit with any Secured Party and in certificates of
deposit and other deposit accounts as to which any Grantor is an account holder
against the unpaid balance of the Secured Obligations.
2.6 PURCHASE MONEY SECURITY INTEREST: To the extent any of the Secured
Obligations arising after the execution of this Agreement is used by any Grantor
to purchase inventory and/or equipment, it is agreed that the security interest
of Administrative Agent for the pro rata benefit of the Secured Parties shall
constitute a purchase money security interest in such equipment and/or
inventory.
ARTICLE 3
GRANTORS' REPRESENTATIONS AND WARRANTIES
3.1 REPRESENTATIONS AND WARRANTIES: Except as previously disclosed to
Lender in writing, Grantors hereby represent and warrant to the Administrative
Agent for the benefit of the Secured Parties that: (A) Grantors are and will
continue to be the lawful owner of the Collateral, except for sales of inventory
in the ordinary course of business; (B) Grantors have the right to grant a
security interest in the Collateral in favor of the Administrative Agent for the
benefit of the Secured Parties; (C) as of the time this Agreement is executed or
at the time a financing statement is filed with regard to the Collateral, there
are and will be no liens, encumbrances, or other security interests affecting
the Collateral other than those permitted by the Credit Agreement; (D) the
security rights and interests granted under this Agreement will at no time
become subordinate or junior to any security rights, interest, liens or claims
of any
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person, firm, or corporation; and (E) this Agreement is binding upon Grantors as
well as Grantors' successors, representatives and assigns, and is legally
enforceable in accordance with its terms. The above representations and
warranties and all other representations and warranties contained in this
Agreement are and will be continuing in nature and will remain in full force and
effect until such time as this Agreement is cancelled in the manner provided
above.
3.2 PROHIBITIONS REGARDING THE COLLATERAL: So long as this Agreement
remains in effect, and to the extent applicable, Grantors agree not to, without
Administrative Agent's prior written consent: (A) sell, assign, transfer,
convey, option, mortgage, or lease the Collateral, except as permitted in the
Credit Agreement; (B) permit any lien, encumbrance, or other security interest
to be placed on or attach to the Collateral except as permitted in the Credit
Agreement; (C) permit any of the Collateral to be attached to real (immovable)
property so as to become a "fixture" within the context of the Uniform
Commercial Code; (D) do anything or permit anything to be done that may in any
way impair the security interest and rights in and to the Collateral created by
this Agreement; (E) except as permitted in this Agreement or the Credit
Agreement, modify, adjust, compromise, settle, waive or forego any rights that
Grantor may have with regard to the Collateral. Notwithstanding any other
provision of this Agreement to the contrary, to the extent that the Collateral
consists of Grantors' inventory, Grantors shall have the right to sell or lease
individual items of inventory in the ordinary course of Grantors' business. Upon
the occurrence of a Default any and all proceeds accruing from the sale, lease
or other disposition of the inventory shall be fully, faithfully and promptly
accounted for by Grantors, and shall be received by Grantors in trust for
Administrative Agent for the benefit of the Secured Parties separate and apart
from Grantors' other funds, and shall be promptly remitted to Administrative
Agent to be applied against the Secured Obligations.
3.3 TYPE AND JURISDICTION OF ORGANIZATION. Each Grantor represents and
warrants that it is a corporation, limited partnership, or limited liability
company as set forth on Schedule A hereto. Each Grantor represents and warrants
that it is a "registered organization" and that its state organization number is
set forth on such Schedule A.
3.4 PRINCIPAL LOCATIONS. Each Grantor represents and warrants that its
mailing address and the location of its place of business (if it only has one)
or its chief executive office (if it has more than one place of business) are as
follows:
0000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxxxxx, XX 00000
3.5 NO OTHER NAMES. Each Grantor represents and warrants that, except
as set forth on Schedule 1, it has not conducted business in the United States
under any name in the last six (6) years except the name in which it has
executed this Agreement, which is the exact name as it appears in the Grantor's
organizational documents, as amended, as filed with the Grantor's jurisdiction
of organization.
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3.6 FEDERAL EMPLOYER IDENTIFICATION NUMBER.. Each Grantor represents
and warrants that its Federal employer identification number is as set forth in
the Exhibit A attached to this Agreement.
ARTICLE 4
AFFIRMATIVE COVENANTS
So long as this Agreement remains in effect, and to the extent
applicable, Grantors agree as follows:
(a) To the extent that the Collateral consists of the
Grantors' inventory, Grantors shall store and exhibit said inventory for the
purpose of sale or lease in the ordinary course of business. Grantors will not,
without having first obtained Administrative Agent's prior written consent, use
any items of Grantors' inventory for Grantors' own purposes except in the
ordinary course of business, or relinquish possession of any such inventory
items to third parties, whether for demonstration purposes or otherwise, except
in the ordinary course of business.
(b) Grantors will not, and will not permit others to, abandon,
waste or destroy the Collateral. Grantors will observe and abide by and cause
others to observe and abide by all laws, rules regulations and ordinances, as
well as all policies of insurance, affecting the Collateral or its use.
(c) Grantors will maintain adequate insurance on the
Collateral at Grantors' sole expense as required by the Credit Agreement.
(d) Grantors will promptly pay when due all taxes, local and
special assessments and governmental charges of every type and description that
may from time to time be imposed, assessed or levied against the Collateral
(other than those the amount or validity of which is currently being contested
in good faith by appropriate proceedings and with respect to which reserves in
accordance with generally accepted accounting principles have been provided on
the books of Grantors). Upon Administrative Agent's request, Grantors will
additionally provide Administrative Agent and Lenders with evidence that such
taxes, assessments and governmental charges have been paid in full and a timely
manner.
(e) Grantors will not make or permit to be made any
alterations to the Collateral that may unreasonably reduce or impair the
Collateral's use or value. The Administrative Agent or its agents may
periodically inspect the Collateral at all reasonable times and on reasonable
prior notice and obtain appraisals of the Collateral from time to time while
this Agreement remains in effect.
(f) Grantors will keep proper books and records with regard to
Grantors' business activities and the Collateral subject to this Agreement. The
Administrative Agent or its agents shall have the right to inspect and copy
Grantors' books and records, and to discuss Grantors' affairs and finances with
Grantor at reasonable times and on reasonable prior notice.
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(g) Grantors will keep and maintain, and cause others to keep
and maintain, the Collateral in good order, repair and condition at all times
while this Agreement remains in effect, ordinary wear and tear excepted.
Grantors will further pay when due all claims for work done, or services
rendered, or materials furnished in connection with the Collateral so that no
lien or encumbrance may ever attach to or be filed against the Collateral except
as permitted in the Credit Agreement.
(h) Should any Grantor for any reason fail to maintain
insurance on the Collateral as required by the Credit Agreement, or fail to pay
taxes, assessments and other governmental charges when due, or should any
Grantor fail to repair and maintain the Collateral as required under this
Agreement, then Administrative Agent on behalf of Secured Parties shall have the
right, at Administrative Agent's sole option and without responsibility to do
so, to make advances to purchase such insurance on Grantors' behalf (including
insurance protecting only the Secured Parties' interests in the Collateral), to
pay governmental charges, and to make necessary repairs to Collateral. Further,
Administrative Agent may from time to time make additional advances in order to
obtain current appraisals of the Collateral. Should any Grantor default under
any other loan or extension of credit secured by the Collateral, or should the
Collateral become subject to or threatened with seizure and/or sale, then
Administrative Agent shall have the additional right, again at Administrative
Agent's sole option and discretion and without any responsibility or liability
to do so, to cure such defaults or to cause such defaults to be cured, whether
by making payments on Grantors' behalf or by taking such other actions as
Administrative Agent may deem to be necessary and proper within its sole
discretion. All such additional sums that Administrative Agent on behalf of
Secured Parties or that any Secured Party may advance on Grantors' behalf, as
well as Administrative Agent's or Secured Parties' additional expense as
provided under this Agreement, shall be considered a part of the Secured
Obligations secured by this Agreement, and shall be treated as an additional
advance under the Credit Agreement. Grantors will reimburse Administrative Agent
or Secured Parties immediately for all such additional advances, together with
interest thereon as provided in the Credit Agreement.
ARTICLE 5
SPECIAL COVENANTS FOR ACCOUNTS, CHATTEL PAPER AND CONTRACT RIGHTS
Grantors further agree and covenant as follows:
(a) In addition to the representations and warranties set
forth above, Grantors represent and warrant to Administrative Agent for the
benefit of the Secured Parties with regard to Grantors' accounts, chattel paper
and contract rights on which Lenders have been granted a security interest that:
(A) such accounts, chattel paper and contract rights represent and/or will
continue to represent bona fide obligations of the obligor and obligors
thereunder, free of any offset, compensation, deduction and counterclaim, except
as reflected on the books of Grantors;
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and (B) such accounts, chattel paper, contracts and agreements are and will
continue to be in full compliance with all applicable state and federal laws and
regulations.
(b) Grantors shall faithfully perform any and all of its
obligations under any contracts or agreements that may give rise to Grantors'
accounts, chattel paper and/or contract rights on which Administrative Agent has
been granted a security interest. Grantors agree not to do, neglect to do, or
permit to be done, anything that might cause a modification or termination of
any such contract or agreement or the obligations of any obligor or to other
persons thereunder, which may diminish or impair the value of the Collateral or
the pro rata security rights and interests of Administrative Agent for the
benefit of the Secured Parties therein and hereunder.
(c) Upon reasonable request by Administrative Agent, upon the
occurrence of a Default or Unmatured Default, Grantors agree to notify
individual obligors under Grantors' accounts, chattel paper, contracts and other
agreements on which Administrative Agent for the benefit of the Secured Parties
has been granted a security interest, advising such obligors of the fact that
their obligations have been collaterally assigned and pledged to Administrative
Agent for the benefit of the Secured Parties. Should any Grantor fail to provide
such notices for any reason upon request by Administrative Agent, Administrative
Agent may forward appropriate notices to such obligors, either in Grantor's name
or in Administrative Agent's name. Grantors further agree that Administrative
Agent or Administrative Agent's representatives may periodically contact
individual obligors to verify their respective obligations, to determine whether
such obligors have any offsets or counterclaims against Grantors, and with
regard to such other matters about which Administrative Agent may inquire.
(d) Administrative Agent shall have the right, upon the
occurrence of a Default or Unmatured Default, to directly collect and receive
all monies, proceeds and/or payments of Grantors' accounts, chattel paper,
contracts and agreements subject hereto, as such amounts become due and payable.
Upon the occurrence of a Default or Unmatured Default, Administrative Agent
shall have the further right to notify individual obligors under such accounts,
chattel paper, contracts or agreements to pay such proceeds and payments
directly to Administrative Agent at an address to be designated by
Administrative Agent, and to do any and all other things as Administrative Agent
may deem to be necessary and proper, within its sole discretion. Administrative
Agent shall have the additional right, when appropriate and within
Administrative Agent's sole discretion, to file suit, either in its own name or
in the name of Grantors, to collect any and all such sums that may be due and
owing under such accounts, chattel paper, contracts or agreements, and to
enforce any guaranties and security therefore. Administrative Agent may also
take such other actions, either in Grantors' name or in the name of
Administrative Agent, as Administrative Agent may deem appropriate within its
reasonable judgment, with regard to collection and payment of the same,
including without limitation, making any compromise or settlement, or releasing
any parties or collateral security, without affecting the liability of Grantors
under this Agreement or under the Secured Obligations secured hereby.
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ARTICLE 6
DEFAULT REMEDIES
6.1 DEFAULT: Should a Default occur Administrative Agent shall have all
the rights of a secured party under the Uniform Commercial Code. In addition and
without limitation, Administrative Agent may exercise any one or more of the
following rights and remedies:
ACCELERATE SECURED OBLIGATIONS. Administrative Agent may declare the
entire Secured Obligations immediately due and payable, without notice.
ASSEMBLE COLLATERAL. Administrative Agent may require Grantors to
deliver to Administrative Agent all or any portion of the Collateral
and any and all certificates of title and other documents relating to
the Collateral. Administrative Agent may require Grantors to assemble
the Collateral and make it available to Administrative Agent at a place
to be designated by Administrative Agent. Administrative Agent also
shall have full power to enter, provided it does so without a breach of
the peace or a trespass, upon the property of Grantors to take
possession of and remove the Collateral. If the Collateral contains
other goods not covered by this Agreement at the time of repossession,
Grantors agree Administrative Agent may take such other goods, provided
that Administrative Agent makes reasonable efforts to return them to
Grantors after repossession.
SELL THE COLLATERAL. Administrative Agent shall have full power to
sell, lease, transfer, or otherwise deal with the Collateral or
proceeds thereof in its own name or that of Grantors. Administrative
Agent or Lenders may sell the Collateral at public auction or private
sale. Unless the Collateral threatens to decline speedily in value or
is of a type customarily sold on a recognized market, Administrative
Agent will give Grantors reasonable notice of the time after which any
private sale or any other intended disposition of the Collateral is to
be made. The requirements of reasonable notice shall be met if such
notice is given at least ten (10) days before the time of the sale or
disposition. All expenses relating to the disposition of the
Collateral, including without limitation the expenses of retaking,
holding, insuring, preparing for sale and selling the Collateral, shall
become a part of the Secured Obligations secured by this Agreement and
shall be payable on demand, with interest thereon until paid at the
rate equal to the then highest rate of interest charged on the
principal of any of the Secured Obligations plus two percent (2%).
APPOINT RECEIVER. To the extent permitted by applicable law,
Administrative Agent shall have the following rights and remedies
regarding the appointment of a receiver: (a) Administrative Agent may
have a receiver appointed as a matter or right, (b) the receiver may be
an employee of Administrative Agent may serve without bond, and (c) all
fees of the receiver and his or her attorney shall become part of the
Secured Obligations secured by this Agreement and shall be payable on
demand, with interest thereon until paid at the rate equal to the then
highest rate of interest charged on the principal of any of the Secured
Obligations plus two percent (2%) annum from date of expenditure until
repaid.
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XXXXXXX XXXXXXXX, APPLY ACCOUNTS. Administrative Agent, either itself
or through a receiver, may collect the payments, rents, income, and
revenues from the Collateral. Administrative Agent may at any time in
its discretion transfer any Collateral into its own name or that of its
nominee and receiver the payments, rents, income, and revenues
therefrom and hold the same as security for the Secured Obligations or
apply it to payment of the Secured Obligations in such order of
preference as Administrative Agent may determine. Insofar as the
Collateral consists of accounts, general intangibles, insurance
policies, instruments, chattel paper, choses in action, or similar
property, Administrative Agent may demand, collect, receive for,
settle, compromise, adjust, xxx for, foreclose, or realize on the
Collateral as Administrative Agent may determine, whether or not
Secured Obligations or Collateral is then due. For these purposes,
Administrative Agent may, on behalf of and in the name of Grantors,
receive, open and dispose of mail addressed to Grantors, change any
address to which mail and payments are to be sent, and endorse notes,
checks, drafts, money orders, documents of title, instruments and items
pertaining to payment, shipment, or storage of any Collateral. To
facilitate collection, Administrative Agent may notify account debtors
and obligors on any Collateral to make payments directly to
Administrative Agent.
OBTAIN DEFICIENCY. If Administrative Agent choses to sell any or all of
the Collateral, Administrative Agent may obtain a judgment against
Grantors for any deficiency remaining on the Secured Obligations due to
Administrative Agent after application of all amounts received from the
exercise of the rights provided in this Agreement. Grantors shall be
liable for a deficiency even if the transaction described in this
subsection is a sale of accounts or chattel paper.
OTHER RIGHTS AND REMEDIES. Administrative Agent shall have all the
rights and remedies of a secured creditor under the provisions of the
Uniform Commercial Code, as may be amended from time to time. In
addition, Administrative Agent shall have and may exercise any or all
other rights and remedies it may have available at law, in equity, or
otherwise.
SPECIAL LOUISIANA PROVISIONS. For purposes of foreclosure under
Louisiana executory process procedures, Grantors confess judgment and
acknowledges to be indebted to Secured Parties up to the full amount of
the Secured Obligations, in principal, interest, costs, expenses,
attorney's fees and other fees and charges, and all other amounts
secured by this Agreement. To the extent permitted under applicable
Louisiana law, Grantors additionally waive: (A) the benefit of
appraisal as provided under Articles 2332, 2336, 2723 and 2724 of the
Louisiana Code of Civil Procedure, and all other laws with regard to
the appraisal upon judicial sale; (B) the demand and three days' delay
as provided under Articles 2639 and 2721 of the Louisiana Code of Civil
Procedure; (C) the notice of seizure as provided under Articles 2293
and 2721 of the Louisiana Code of Civil Procedure; (D) for three (3)
days' delay provided under Articles 2331 and 2722 of the Louisiana Code
of Civil Procedure; and (E) all other benefits provided under Articles
2331, 2722 and 2723 of the Louisiana Code of Civil Procedure and all
other Articles not specifically mentioned above. Grantors further agree
that any declaration of fact made by authentic act before a Notary
Public and two witnesses by a person declaring that such facts are
within his or her knowledge shall constitute authentic evidence of such
-12-
facts for purposes of foreclosure under applicable Louisiana law.
Grantors further agree that Administrative Agent may appoint a keeper
of the Collateral in the event of foreclosure.
6.2 EXPENSES: All expenses relating to the sale or other disposition of
the Collateral, including, without limitation, Administrative Agent's and
Secured Parties' reasonable attorney's fees and expenses of retaking, holding,
insuring, preparing for sale and selling the Collateral, shall become a part of
the Secured Obligations secured by this Agreement and shall be payable on
demand, with interest thereon until paid at the rate equal to the then highest
rate of interest charged on the principal of any of the Secured Obligations plus
two percent (2%) from the date of expenditure until Administrative Agent or
Secured Parties are repaid in full.
6.3 NO RESTRICTION OF REMEDIES: Grantors agree that all of the remedies
provided herein are and shall be cumulative in nature and nothing under this
Agreement shall limit or restrict the remedies available to Administrative Agent
following any event of default.
6.4 APPLICATION OF PROCEEDS: All payments received by the
Administrative Agent hereunder shall be applied by the Administrative Agent to
payment of the Secured Obligations in the following order unless a court of
competent jurisdiction shall otherwise direct:
(a) FIRST, to payment of all costs and expenses of the
Administrative Agent incurred in connection with the collection and
enforcement of the Secured Obligations or of any security interest
granted to the Administrative Agent in connection with any collateral
securing the Secured Obligations;
(b) SECOND, to payment of that portion of the Secured
Obligations constituting accrued and unpaid interest and fees, pro rata
among the Secured Parties in accordance with the amount of such accrued
and unpaid interest and fees owing to each of them;
(c) THIRD, to payment of the principal of the Secured
Obligations and the net early termination payments and any other Rate
Management Obligations then due and unpaid from the Borrower to any of
the Secured Parties, pro rata among the Secured Parties in accordance
with the amount of such principal and such net early termination
payments and other Rate Management Obligations then due and unpaid
owing to each of them; and
(d) FOURTH, to payment of any Secured Obligations (other than
those listed above) pro rata among those parties to whom such Secured
Obligations are due in accordance with the amounts owing to each of
them.
6.5 PROTECTION OF SECURITY INTEREST: Grantors agrees to be fully
responsible for any losses that Administrative Agent or Secured Parties may
suffer as a result of anyone other than Administrative Agent or Secured Parties
asserting any rights or interest in the
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Collateral. Grantors further agree to appear in and defend all actions and
proceedings purporting to affect Secured Parties' security rights and interest.
Should Grantors fail to do what is required of it under this agreement, or if
any action or proceeding is commenced naming Administrative Agent or Secured
Parties as a party, or affecting Secured Parties' security interest, or the
rights and powers granted under this Agreement, then Administrative Agent or
Secured Parties may, without releasing Grantors from any of its obligations, do
whatever Administrative Agent or Secured Parties believes is necessary and
proper within their reasonable discretion, including advancing additional sums
on Grantors' behalf as provided herein, to protect Secured Parties' security
rights and interests.
6.6 INDEMNIFICATION OF ADMINISTRATIVE AGENT AND SECURED PARTIES:
Grantors further agree to indemnify, to defend and to hold Administrative Agent
and Secured Parties harmless from any and all claims, suits, obligations,
damages, loss, costs, and expenses (including the fees of Administrative Agent's
or Secured Parties' attorney), demand, liability, penalties, fines and
forfeitures of any nature and kind whatsoever, that may be asserted against or
incurred by Administrative Agent or any Secured Party, arising out of or in any
way occasioned by this Agreement or the rights and remedies granted to or in
favor of Administrative Agent or Secured Parties hereunder, except to the extent
such claims, suits, obligations, damages, loss, costs, and expenses (including
the fees of Administrative Agent's or Secured Parties' attorney), demand,
liability, penalties, fines and forfeitures of any nature and kind whatsoever
arise out of or are in any way occasioned by the intentional misconduct or gross
negligence of Administrative Agent or Secured Parties.
ARTICLE 7
DELAYED RIGHTS
If Grantors should ever make a payment on, or if any of
Grantors' Collateral or other property is ever used to pay a loan or other
obligation to any Secured Party of a company as to which any Grantor is or may
at any time be an "insider" within the context of Section 101(3) of the
Bankruptcy Code (11 U.S.C. Section 101(30)), Grantors agree that any rights that
it may have to collect from or be reimbursed by such a company or by any other
guarantor or surety, whether as a result of subrogation to Administrative
Agent's or Secured Parties' rights or otherwise, will be delayed until the
thirteen month anniversary date following full and final payment to Secured
Parties.
ARTICLE 8
REVISED ARTICLE 9
Each Grantor hereby confirms that by signing this Agreement,
that Grantor has authenticated this Agreement, within the meaning of revised
Chapter 9 of the Louisiana Commercial Laws and Revised Article 9 of the Uniform
Commercial Code as now or hereafter in effect in any jurisdiction ("Revised
Article 9"). This Agreement shall constitute full authorization in favor of
Administrative Agent to file appropriate financing statements, initial or
-14-
"in lieu" financing statements, continuation statements, and statements of
amendment, with or without any Grantor's signature, as may be necessary or
advisable to perfect and maintain the perfection and priority of the security
interest granted to Administrative Agent in this Agreement, including any such
filings containing such information required by Part 5 of Revised Article 9 for
the sufficiency or filing office acceptance of any financing statement,
continuation statement or amendment, including whether any Grantor is an
organization, the type of organization and any organization number issued to the
Grantor. Each Grantor shall furnish such information to Administrative Agent
upon Administrative Agent's request. Any such financing statements, continuation
statements or amendments may be signed by Administrative Agent on Grantors'
behalf. Any such filings by an Administrative Agent may be by delivery of
originals or photocopies, by electronic communication, or such other authorized
form of communication as may be permitted under then applicable law.
ARTICLE 9
MISCELLANEOUS PROVISIONS
In entering into this Agreement, Grantors are, to the extent
applicable, waiving any exemption from seizure with regard to the Collateral to
which Grantors may be entitled under applicable law.
9.1 Each Grantor agrees to notify Administrative Agent in writing in
advance should Grantors ever change its name, legal status, or change or obtain
a new Federal employer identification number or entity organizational number.
Grantors further agree to notify Administrative Agent in writing in advance of
any change in Grantors' mailing address or the location of Grantors' principal
office.
9.2 Grantors agree that any failure or delay on the part of
Administrative Agent or Secured Parties to exercise any of the rights and
remedies granted under this Agreement shall not constitute a waiver of such
rights or remedies. Any waiver or forbearance on the part of the Administrative
Agent or Secured Parties shall be effective against Grantors only if agreed to
in writing.
9.3 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF LOUISIANA AND APPLICABLE FEDERAL LAWS, EXCEPT TO THE
EXTENT PERFECTION AND THE EFFECT OR PERFECTION OR NON-PERFECTION OF THE SECURITY
INTEREST GRANTED HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL, ARE
GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF LOUISIANA. If any
provision of this Agreement is deemed to be invalid or unenforceable for any
reason, such invalidity or unenforceability will not affect the
-15-
validity and enforceability of the remaining provisions of this Agreement. The
caption headings of this Agreement are for convenient reference only and are not
to be construed as a summary of each provision of this Agreement.
9.4 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAW OF THE STATE OF LOUISIANA. EACH OF THE GRANTORS HEREBY SUBMITS TO
THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF LOUISIANA AND OF ANY LOUISIANA STATE COURT SITTING IN NEW
ORLEANS, LOUISIANA AND FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS AGREEMENT (INCLUDING, WITHOUT LIMITATION, ANY OF THE OTHER LOAN
DOCUMENTS) OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE GRANTORS
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
ANY OF THEM MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH
PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH OF THE
GRANTORS, AND THE ADMINISTRATIVE AGENT AND THE SECURED PARTIES ACCEPTING THIS
GUARANTY, HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
9.5 Grantors agree that Administrative Agent may file a carbon,
photographic, facsimile or other type of copy of this Agreement, or of a UCC
financing statement, in lieu of filing an original containing the signature of
Grantors or of Grantors' duly authorized representative. Grantors further agree
to reimburse Administrative Agent for the costs of filing, amending, continuing,
terminating and releasing Grantors' UCC financing statement(s), to the extent
applicable, which costs shall be considered an additional Secured Obligations
secured under this Agreement.
ARTICLE 10
THE ADMINISTRATIVE AGENT
Bank One, NA has been appointed Administrative Agent for the
Lenders hereunder pursuant to Article X of the Credit Agreement. It is expressly
understood and agreed by the parties to this Agreement that any authority
conferred upon the Administrative Agent hereunder is subject to the terms of the
delegation of authority made by the Secured Parties to the Administrative Agent
pursuant to the Credit Agreement, and that the Administrative Agent has agreed
to act (and any successor Administrative Agent shall act) as such hereunder only
on the express conditions contained in such Article X. Any successor
Administrative Agent appointed pursuant to Article X of the Credit Agreement
shall be entitled to all the rights, interests and benefits of the
Administrative Agent hereunder.
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[Remainder of page intentionally left blank]
-17-
This Agreement is executed by each Grantor and the Administrative Agent
as of the date written above.
GRANTORS:
NEWPARK RESOURCES, INC.
By:
--------------------------------------------
Name: Xxxx X. Xxxxxxxx, Xx.
Title: Treasurer
EXCALIBAR MINERALS INC.,
MALLARD & MALLARD OF LA., INC.,
NEWPARK HOLDINGS, INC.,
SUPREME CONTRACTORS, L.L.C.,
NEWPARK DRILLING FLUIDS, LLC,
NEWPARK ENVIRONMENTAL SERVICES, L.L.C.,
NEWPARK ENVIRONMENTAL MANAGEMENT COMPANY,
L.L.C., NEWPARK TEXAS, L.L.C.,
EXCALIBAR MINERALS OF LA., L.L.C., and
SOLOCO, L.L.C.
By:
--------------------------------------------
Name: Xxxx X. Xxxxxxxx, Xx.
Title: Treasurer
XXXXXX MILL, L.P.,
NEWPARK ENVIRONMENTAL SERVICES OF TEXAS, L.P.,
NEWPARK SHIPHOLDING TEXAS, L.P.,
NID, L.P.,
SOLOCO TEXAS, L.P.,
NES PERMIAN BASIN, L.P. and
NEWPARK ENVIRONMENTAL SERVICES MISSISSIPPI, L.P.
By: Newpark Holdings, Inc., the general
partner of each
By:
--------------------------------------------
Name: Xxxx X. Xxxxxxxx, Xx.
Title: Treasurer
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ADMINISTRATIVE AGENT:
BANK ONE, NA
(MAIN OFFICE, CHICAGO, ILLINOIS)
By:
--------------------------------------------
Name: J. Xxxxxxx Xxxxx
Title: Director, Capital Markets
-19-
EXHIBIT "A"
Organizational No. Tax ID No.
------------------ ----------
NEWPARK RESOURCES, INC., a Delaware corporation 2162755 00-0000000
EXCALIBAR MINERALS INC., a Texas corporation 118846100 00-0000000
MALLARD & MALLARD OF LA., INC., a Louisiana corporation 32703240D 00-0000000
NEWPARK HOLDINGS, INC., a Louisiana corporation 34482682D 00-0000000
SUPREME CONTRACTORS, L.L.C., a Louisiana limited liability company 34725784K 00-0000000
NEWPARK DRILLING FLUIDS, LLC, a Texas limited liability company 706080122 00-0000000
NEWPARK ENVIRONMENTAL SERVICES, L.L.C., a Louisiana limited liability 34871205K 00-0000000
company
NEWPARK ENVIRONMENTAL MANAGEMENT COMPANY, L.L.C., a Louisiana limited 34513965K 00-0000000
liability company
NEWPARK TEXAS, L.L.C., a Louisiana limited liability company 34481667K 00-0000000
EXCALIBAR MINERALS OF LA., L.L.C., a Louisiana limited liability company 34555250K 00-0000000
SOLOCO, L.L.C., a Louisiana limited liability company 34481693K 00-0000000
XXXXXX MILL, L.P., a Texas limited partnership 7869710 00-0000000
NEWPARK ENVIRONMENTAL SERVICES OF TEXAS, L.P., a Texas limited partnership 8598110 00-0000000
NEWPARK SHIPHOLDING TEXAS, L.P., a Texas limited partnership 7858610 00-0000000
NID, L.P., a Texas limited partnership 9570010 00-0000000
SOLOCO TEXAS, L.P., a Texas limited partnership 7858510 00-0000000
NES PERMIAN BASIN, L.P., a Texas limited partnership 10163210 00-0000000
NEWPARK ENVIRONMENTAL SERVICES MISSISSIPPI, L.P., a Mississippi limited 642172 00-0000000
partnership
-20-
SCHEDULE 1
Advanced Chemical Technologies, Inc.
Anchor Drilling Fluids USA, Inc.
Xxxxxx Mill, Inc.
BFC Oil Company
Bulkfleet Marine, Inc.
Cajun Oilfield Services, Inc.
Chem-Drill, Inc.
Xxxxxxxx Construction, Inc.
FMI Wholesale Drilling Fluids, USA, L.P.
F&S Marine Services, Inc.
Fiber Products, Inc.
Iberia Barite, L.L.C.
J. Pouyer Interest, Inc.
Legend Construction, Inc.
Mallard & Mallard, Inc.
Mid-Continent Completion Fluids, Inc.
Newpark Drilling Fluids, Inc.
Newpark Environmental Services, Inc.
Newpark Environmental Services, LLC
Newpark Environmental Water Services, Inc.
Newpark Mill, Inc.
Newpark Texas Drilling Fluids, Inc.
Newpark Wellhead Services, Inc. (LA)
NOW Disposal Operating Co.
Oak Valley Ltd. Partnership
Permian Brine Sales, Inc.
Perry Trucking, Inc.
Quality Sites for Oil Industries, Inc.
Red Hill Disposal, Inc.
Xxxxxx Xxxxx Xxxxxx Drilling Fluids Management, Inc.
Shamrock Drilling Fluids, Inc.
Xxxxxxx, Inc.
SOLOCO, INC.
Southwestern Universal Corp.
Supreme Contractors, Inc.
Supreme Contractors International, Inc.
OGS Laboratory, Inc.
Darcom International, LP
Sonnex, Inc.
Consolidated Mayflower Mines, Inc.
Xxxxxxx Construction Company of LA, Inc.
Xxxxxx X Xxxxx Services, Inc.
Gulf South Environmental Consultants, Inc.
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Hydra Fluids, Inc.
Houston Prime Pipe & Supply, Inc.
NOW Disposal Holding Co.
O'Brien - Xxxxx - Xxxxxxx & Associates, Inc.
Qualitex, Inc.
SBM Acquisition Corporation
Newpark Support Services
Newpark Transportation
Xxxxxxx Construction Company, Inc.
Florida Mat Rentals, Inc.
Xxxxxxx Construction Company, Inc.
Chemical Technologies, Inc.
JPI Acquisition Corp.
NDF Mexico, Inc.
Newpark Performance Services, Inc.
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