Exhibit 10.2
FOURTH AMENDMENT TO LOAN AGREEMENT
THIS FOURTH AMENDMENT TO LOAN AGREEMENT (this "Amendment") is executed on
March 25, 2004, to be effective as of March 31, 2004, by and among THE CIT
GROUP/BUSINESS CREDIT, INC., a New York corporation ("CITBC"), in its individual
capacity as a Lender and as Agent for the Lenders hereinafter named (the
"AGENT"), XXXXX FARGO FOOTHILL, INC.,, a California corporation formerly known
as Foothill Capital Corporation, and any other party hereafter becoming a Lender
pursuant to Section 12.4(b) of the Loan Agreement (as hereinafter defined), each
individually sometimes referred to as a "LENDER" and, collectively, the
"LENDERS"), GREY WOLF DRILLING COMPANY L.P., a Texas limited partnership (the
"BORROWER"), GREY WOLF, INC., a Texas corporation (the "PARENT"), GREY WOLF
HOLDINGS COMPANY, a Nevada corporation ("HOLDINGS"), GREY WOLF LLC, a Louisiana
limited liability company ("GWLLC"), DI ENERGY, INC., a Texas corporation
("ENERGY"), GREY WOLF INTERNATIONAL, INC., a Texas corporation
("INTERNATIONAL"), DI/PERFENSA INC., a Texas corporation ("PERFENSA"), MURCO
DRILLING CORPORATION, a Delaware corporation ("MURCO") (Parent, Holdings, GWLLC,
Energy, International, Perfensa and Murco are referred to collectively herein as
the "GUARANTORS").
RECITALS
1. WHEREAS, pursuant to the terms and subject to the conditions of that
certain Loan Agreement dated as of January 14, 1999 among the parties hereto, as
amended by that certain First Amendment to Loan Agreement dated as of December
20, 2001, that certain Second Amendment to Loan Agreement dated as of February
7, 2003, and that certain Third Amendment to Loan Agreement dated as of May 1,
2003 (such Loan Agreement, as the same was previously amended, is hereby amended
and may hereafter be amended from time to time, being hereinafter referred to as
the "Loan Agreement"), the Borrower was granted a $50,000,000 revolving line of
credit which included a letter of credit facility;
2. WHEREAS, the indebtedness of the Borrower to the Lenders is
currently evidenced by that certain Revolving Note dated December 20, 2001 (the
"Revolving Note"), executed by the Borrower and payable to CITBC as Agent for
the benefit of the Lenders in the stated principal amount of $75,000,000;
3. WHEREAS, payment of the Obligations of the Borrower are supported by
the guarantees of the Guarantors contained in Section 13 of the Loan Agreement;
4. WHEREAS, to secure, in part, the indebtedness under the Loan
Agreement and the Revolving Note (and all renewals, extensions, modifications
and/or rearrangements thereof and in connection therewith) and all other
indebtedness, liabilities and obligations of the Borrower and the Guarantors to
the Agent for the benefit of the Lenders, then existing or thereafter arising,
the Borrower and the Guarantors have heretofore executed in favor of the Agent
certain Credit Documents (as defined in the Loan Agreement), including, without
limitation, the Security Documents (as defined in the Loan Agreement), which
Credit Documents, as amended in connection herewith, shall continue in full
force and effect upon the
execution of this Amendment and shall continue to secure the payment by the
Borrower and the Guarantors of the Obligations (as defined in the Loan
Agreement), all as more fully set forth therein and herein;
5. WHEREAS, the Borrower has requested that the Agent and the Lenders
modify and, pursuant to the terms and subject to the conditions hereof and in
connection herewith, the Agent and the Lenders have agreed to modify, Section
8.4(h), the definition of Permitted Refinancing, and the related provisions
under the Loan Agreement; and
6. WHEREAS, in furtherance of the foregoing and to evidence the
agreements of the parties hereto in relation thereto, the parties hereto desire
to amend the Loan Agreement as hereinafter provided.
NOW, THEREFORE, in consideration of the premises herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Borrower, the Guarantors, the Agent and the Lenders,
intending to be legally bound, agree as follows:
AGREEMENT
ARTICLE I
DEFINITIONS
1.01 Capitalized terms used in this Amendment are defined in the Loan
Agreement, as amended hereby, unless otherwise stated.
ARTICLE II
AMENDMENTS TO LOAN AGREEMENT
Effective as of the respective date herein indicated, the Loan Agreement
is hereby amended as follows:
2.01 AMENDMENT AND RESTATEMENT OF DEFINITION OF "PERMITTED REFINANCING".
Effective as of the date of execution of this Amendment, the definition of
"Permitted Refinancing" set forth in Section 10 of the Loan Agreement is amended
and restated to read in its entirety as follows:
""Permitted Refinancing" shall mean a refinancing of all or any
portion of the Indebtedness evidenced by (i) the 3.75% Contingent
Convertible Senior Notes Due 2023 issued by the Parent in 2003, in the
aggregate principal amount of $150,000,000, and (ii) the Floating Rate
Contingent Convertible Senior Notes Due 2024 issued by the Parent in 2004,
in the aggregate principal amount of up to $125,000,000 (in each case,
either with the same payees or different financing sources), including a
restructure or restatement of such existing Indebtedness or a new loan to
repay such existing Indebtedness, so long as
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(a) the terms of the refinanced Indebtedness are not materially more
favorable to the payee(s) and are not less favorable to the Lenders than
the existing Indebtedness which was refinanced, (b) no Default or Event of
Default will exist immediately after the completion of such refinancing,
and (c) such refinancing Indebtedness is unsecured and subordinated in
right of payment to the Obligations at least to the same extent as the
Indebtedness being refinanced."
2.02 AMENDMENT OF SECTION 8.4. Effective as of the date of execution of
this Amendment, Section 8.4(h) of the Loan Agreement is amended and restated to
read in its entirety as follows:
"(h) Unsecured Indebtedness evidenced by (i) the 3.75% Contingent
Convertible Senior Notes Due 2023 issued by the Parent in 2003, in the
aggregate principal amount of $150,000,000, (ii) the Floating Rate
Contingent Convertible Senior Notes Due 2024 issued by the Parent in 2004,
in the aggregate principal amount of up to $125,000,000, and (iii) any
Permitted Refinancing."
ARTICLE III
CONDITIONS PRECEDENT
3.01 CONDITIONS TO EFFECTIVENESS. The effectiveness of this Amendment is
subject to the satisfaction of the following conditions precedent in a manner
satisfactory to Agent, unless specifically waived in writing by Agent:
(a) Agent shall have received each of the following, each in form
and substance satisfactory to Agent, in its sole discretion, and, where
applicable, each duly executed by each party thereto, other than Agent:
(i) This Amendment, duly executed by the Borrower and the
Guarantors; and
(ii) All other documents Agent may request with respect to any
matter relevant to this Amendment or the transactions contemplated
hereby.
(b) The representations and warranties contained herein and in the
Loan Agreement and the other Credit Documents (as defined in the Loan
Agreement), as each is amended hereby, shall be true and correct as of the
date hereof, as if made on the date hereof.
(c) No Default or Event of Default shall have occurred and be
continuing, unless such Default or Event of Default has been otherwise
specifically waived in writing by Agent.
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(d) All corporate proceedings taken in connection with the
transactions contemplated by this Amendment and all documents, instruments
and other legal matters incident thereto shall be satisfactory to Agent.
(e) Agent's receipt of the fees described in the fee letter dated of
even date herewith executed by Borrower and Agent.
ARTICLE IV
RATIFICATIONS, REPRESENTATIONS AND WARRANTIES
4.01 RATIFICATIONS. The terms and provisions set forth in this Amendment
shall modify and supersede all inconsistent terms and provisions set forth in
the Loan Agreement and the other Credit Documents, and, except as expressly
modified and superseded by this Amendment, the terms and provisions of the Loan
Agreement and the other Credit Documents are ratified and confirmed and shall
continue in full force and effect. The Borrower, Guarantors, Agent and Lenders
agree that the Loan Agreement and the other Credit Documents, as amended hereby,
shall continue to be legal, valid, binding and enforceable in accordance with
their respective terms. The Loan Agreement and any other Credit Documents
previously executed by Murco under the name "Murco Drilling Corp." are hereby
amended in all cases to use Murco's full legal name, Murco Drilling Corporation,
and Murco agrees that the Loan Agreement and all such other Credit Documents
continue to be valid, binding and enforceable and ratifies the same.
4.02 REPRESENTATIONS AND WARRANTIES. The Borrower and Guarantor (the
"Credit Parties") hereby represent and warrant to Agent and the Lenders that (a)
the execution, delivery and performance of this Amendment and any and all other
Credit Documents executed and/or delivered in connection herewith have been
authorized by all requisite corporate action on the part of the Credit Parties
and will not violate the organizational documents of the Credit Parties; (b) the
Managers or Board of Directors of each of the Credit Parties (or the Board of
Directors of the corporate general partners of any Credit Party that is a
limited partnership) has authorized the execution, delivery and performance of
this Amendment and any and all other Credit Documents executed and/or delivered
in connection herewith; (c) the representations and warranties contained in the
Loan Agreement, as amended hereby, and any other Credit Document are true and
correct on and as of the date hereof and on and as of the date of execution
hereof as though made on and as of each such date; (d) no Default or Event of
Default under the Loan Agreement, as amended hereby, has occurred and is
continuing, unless such Default or Event of Default has been specifically waived
in writing by Agent; (e) the Credit Parties are in full compliance with all
covenants and agreements contained in the Loan Agreement and the other Credit
Documents, as amended hereby; and (f) since the date of the initial closing of
the Loan Agreement, the Credit Parties have not amended their (i) Articles (or
Certificates) of Incorporation or their Bylaws, if a corporation, (ii) limited
partnership agreement or certificate of limited partnership, if a limited
partnership, or (iii) Articles of Organization or operating agreement, if a
limited liability company, except as otherwise disclosed to Agent.
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ARTICLE V
MISCELLANEOUS PROVISIONS
5.01 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties made in the Loan Agreement or any other Credit Document, including,
without limitation, any document furnished in connection with this Amendment,
shall survive the execution and delivery of this Amendment and the other Credit
Documents, and no investigation by Agent or any closing shall affect the
representations and warranties or the right of Agent to rely upon them.
5.02 REFERENCE TO LOAN AGREEMENT. Each of the Loan Agreement and the
other Credit Documents, and any and all other Credit Documents, documents or
instruments now or hereafter executed and delivered pursuant to the terms hereof
or pursuant to the terms of the Loan Agreement, as amended hereby, are hereby
amended so that any reference in the Loan Agreement and such other Credit
Documents to the Loan Agreement shall mean a reference to the Loan Agreement, as
amended hereby.
5.03 EXPENSES OF AGENT. As provided in the Loan Agreement, the Borrower
agrees to pay on demand all reasonable costs and expenses incurred by Agent in
connection with the preparation, negotiation, and execution of this Amendment
and the other Credit Documents executed pursuant hereto and any and all
amendments, modifications, and supplements thereto, including, without
limitation, the reasonable costs and fees of Agent's legal counsel, and all
reasonable costs and expenses incurred by Agent in connection with the
enforcement or preservation of any rights under the Loan Agreement, as amended
hereby, or any other Credit Documents, including, without limitation, the
reasonable costs and fees of Agent's legal counsel.
5.04 SEVERABILITY. Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
5.05 SUCCESSORS AND ASSIGNS. This Amendment is binding upon and shall
inure to the benefit of Agent, the Lenders, and the Credit Parties and their
respective successors and assigns, except that the Credit Parties may not assign
or transfer any of their rights or obligations hereunder without the prior
written consent of Agent.
5.06 COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.
5.07 EFFECT OF WAIVER. No consent or waiver, express or implied, by Agent
to or for any breach of or deviation from any covenant or condition by the
Credit Parties shall be deemed a consent to or waiver of any other breach of the
same or any other covenant, condition or duty.
5.08 HEADINGS. The headings, captions, and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment.
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5.09 APPLICABLE LAW. THIS AMENDMENT AND ALL OTHER CREDIT DOCUMENTS
EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE
IN AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
5.10 FINAL AGREEMENT. THE LOAN AGREEMENT AND THE OTHER CREDIT DOCUMENTS,
EACH AS AMENDED HEREBY, REPRESENT THE ENTIRE EXPRESSION OF THE PARTIES WITH
RESPECT TO THE SUBJECT MATTER HEREOF ON THE DATE THIS AMENDMENT IS EXECUTED. THE
LOAN AGREEMENT AND THE OTHER CREDIT DOCUMENTS, AS AMENDED HEREBY, MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. NO
MODIFICATION, RESCISSION, WAIVER, RELEASE OR AMENDMENT OF ANY PROVISION OF THIS
AMENDMENT SHALL BE MADE, EXCEPT BY A WRITTEN AGREEMENT SIGNED BY THE CREDIT
PARTIES AND THE AGENT.
5.11 FINANCING STATEMENTS. Agent is hereby authorized by each Credit
Parties to file (including pursuant to the applicable terms of the UCC) from
time to time any financing statements, continuations or amendments covering the
Collateral whether or not the signature of any such Credit Party appears
thereon.
5.12 RELEASE BY BORROWER. THE BORROWER HEREBY ACKNOWLEDGES THAT BORROWER
HAS NO DEFENSE, COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY
KIND OR NATURE WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY
PART OF ITS LIABILITY TO REPAY THE "OBLIGATIONS" OR TO SEEK AFFIRMATIVE RELIEF
OR DAMAGES OF ANY KIND OR NATURE FROM AGENT OR THE LENDERS. THE BORROWER HEREBY
VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES AGENT AND THE LENDERS,
AND THEIR RESPECTIVE PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS
(THE "RELEASED PARTIES"), FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF
ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN,
ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR
CONDITIONAL, AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE
THE DATE THIS AMENDMENT IS EXECUTED, WHICH THE BORROWER MAY NOW OR HEREAFTER
HAVE AGAINST THE RELEASED PARTIES, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH
CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR
OTHERWISE, AND ARISING FROM ANY "LOANS", INCLUDING, WITHOUT LIMITATION, ANY
CONTRACTING FOR, CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST
IN EXCESS OF THE HIGHEST LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND
REMEDIES UNDER THE LOAN AGREEMENT OR OTHER CREDIT DOCUMENTS, AND NEGOTIATION FOR
AND EXECUTION OF THIS AMENDMENT.
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5.13 RELEASE BY GUARANTORS. Each Guarantor hereby consents to the terms
of this Amendment, confirms and ratifies the terms of the guarantee by such
Guarantor for the benefit of Agent and the other Lenders set forth in Section 13
of the Loan Agreement (each a "Guarantee" and collectively the "Guarantees"),
and acknowledges that such Guarantor's Guarantee is in full force and effect and
ratifies the same and that such Guarantor has no defense, counterclaim, set-off
or any other claim to diminish such Guarantor's liability under its Guarantee.
EACH GUARANTOR HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES
THE RELEASED PARTIES, FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF
ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN,
ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR
CONDITIONAL, AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE
THE DATE THIS AMENDMENT IS EXECUTED, WHICH THE GUARANTORS MAY NOW OR HEREAFTER
HAVE AGAINST THE RELEASED PARTIES, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH
CLAIMS ARISE OUT OF CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR
OTHERWISE, AND ARISING FROM ANY "LOANS", INCLUDING, WITHOUT LIMITATION, ANY
CONTRACTING FOR, CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST
IN EXCESS OF THE HIGHEST LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND
REMEDIES UNDER THE LOAN AGREEMENT OR OTHER CREDIT DOCUMENTS, AND NEGOTIATION FOR
AND EXECUTION OF THIS AMENDMENT.
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IN WITNESS WHEREOF, this Amendment has been executed and is effective as
of the date first above-written.
BORROWER:
GREY WOLF DRILLING COMPANY L.P.
By: Grey Wolf Holdings Company,
its general partner
By: _________________________________
Xxxxx X. Xxxxxxxx
Senior Vice President and
Chief Financial Officer
GUARANTORS:
GREY WOLF, INC.
By: _____________________________________
Xxxxx X. Xxxxxxxx
Senior Vice President and
Chief Financial Officer
GREY WOLF HOLDINGS COMPANY
By: _____________________________________
Xxxxx X. Xxxxxxxx
Senior Vice President and
Chief Financial Officer
FOURTH AMENDMENT TO LOAN AGREEMENT Page 1
GREY WOLF LLC
By: _____________________________________
Xxxxx X. Xxxxxxxx
Senior Vice President and
Chief Financial Officer
DI ENERGY, INC.
By: _____________________________________
Xxxxx X. Xxxxxxxx
Senior Vice President and
Chief Financial Officer
GREY WOLF INTERNATIONAL, INC.
By: _____________________________________
Xxxxx X. Xxxxxxxx
Senior Vice President and
Chief Financial Officer
DI/PERFENSA INC.
By: _____________________________________
Xxxxx X. Xxxxxxxx
Senior Vice President and
Chief Financial Officer
MURCO DRILLING CORPORATION
By: _____________________________________
Xxxxx X. Xxxxxxxx
Senior Vice President and
Chief Financial Officer
FOURTH AMENDMENT TO LOAN AGREEMENT Page 2
LENDERS:
THE CIT GROUP/BUSINESS CREDIT, INC.
as Agent and Lender
By: _____________________________________
Name: ___________________________________
Title: __________________________________
Revolving Loan Commitment: $40,000,000
FOURTH AMENDMENT TO LOAN AGREEMENT Page 3
XXXXX FARGO FOOTHILL, INC., formerly
known as Foothill Capital Corporation,
as Lender
By: _____________________________________
Name: ___________________________________
Title: __________________________________
Revolving Loan Commitment: $35,000,000
FOURTH AMENDMENT TO LOAN AGREEMENT Page 4
