Exhibit 10.6
FIRST AMENDMENT TO
CREDIT AGREEMENT
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This First Amendment to Credit Agreement (the "First Amendment"), dated as
of December 20, 1994 is entered into by and between DRIL-QUIP (EUROPE) LIMITED,
a private limited company formed under the Companies Act of the United Kingdom
1948, as amended ("Borrower"), and BANK ONE, TEXAS, NATIONAL ASSOCIATION, a
national banking association ("Lender").
W I T N E S S E T H:
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WHEREAS, pursuant to that certain Credit Agreement dated March 30, 1994
(the "Credit Agreement"), Lender agreed to make available to Borrower certain
loans upon the terms and conditions and for the purposes therein contained;
WHEREAS, Borrower has requested that its revolving line of credit be
increased up to a maximum of SEVENTEEN MILLION AND NO/100 DOLLARS
($17,000,000.00) and extended to October 1, 1996 and Lender has agreed to such
increase and extension; and
WHEREAS, Borrower and Lender desire to amend the Credit Agreement so that
the Credit Agreement evidences such increase and extension of the revolving line
of credit and governs such additional advancing line of credit;
NOW THEREFORE, the parties hereto agree as follows:
1. Amendments to Credit Agreement. The Credit Agreement is modified as
follows:
1.1 Wherever the term "Agreement" is used in the Credit Agreement,
such term shall refer to the Credit Agreement as amended by this
First Amendment;
1.2 Article I - Definitions. The definition of the term "Parent's
Revolving Debt Facility" is deleted in its entirety and the
following is substituted in place thereof:
"Parent's Revolving Debt Facility" means that certain
revolving credit loan in the maximum principal amount of
$17,000,000.00 made by Lender to Parent and governed by that
certain Credit Agreement dated March 30, 1994 as amended by
that certain First Amendment to Credit Agreement dated
December 20, 1994 between Lender and Parent as such Credit
Agreement may be further amended, renewed or extended from
time to time.
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1.3 Article I - Definitions. The definition of the term "Revolving Credit
Committed Sum" is deleted in its entirety, and the following is
substituted in place thereof:
"Revolving Credit Committed Sum" means SEVENTEEN MILLION AND
NO/100 DOLLARS ($17,000,000.00), as such amount may be reduced
pursuant to Section 2.06.
1.4 Article I - Definitions. The definition of the term "Revolving Credit
Note" is deleted in its entirety, and the following is substituted in
place thereof:
"Revolving Credit Note" means the promissory note in favor of
Lender in substantially the form of Exhibit F hereto, and all
extensions, renewals and modifications thereof.
1.5 Article I - Definitions. The definition of the term "Revolving Credit
Termination Date" is deleted in its entirety, and the following is
substituted in place thereof:
"Revolving Credit Termination Date" means October 1, 1996, or
such earlier date as the Revolving Credit Commitment terminates
as provided in this Agreement.
2. Condition Precedent. The obligation of Lender to make any Advances
pursuant to Section 2.01 of the Agreement is subject to the condition precedent
that the Lender shall have received all of the following, each duly executed and
in form and substance satisfactory to Lender:
(a) Promissory Note dated December 20, 1994 in the principal amount
of $17,000,000.00 executed by Borrower to the order of Lender,
after execution and delivery being the Revolving Credit Note;
(b) Ratifications or amendments of existing Security Documents and/or
new Security Documents as may be requested by Lender to continue
or establish a Lien in favor or for the benefit of Lender in or
against all of Borrower's accounts, accounts receivable,
equipment, machinery, fixtures, raw materials, work-in-process,
inventory, chattel paper, documents, instruments and general
intangibles, whether now owned or hereafter acquired, and all
products and proceeds thereof;
(c) The Memorandum and Articles of Association of Borrower certified
by the relevant governmental authority of the jurisdiction of
incorporation, dated reasonably near the date of this First
Amendment;
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(d) Certificates of the appropriate government officials of the
jurisdiction of incorporation of Borrower as to its existence and
good standing, dated reasonably near the date of this First
Amendment; and
(e) A favorable opinion of legal counsel to Borrower.
3. Representations and Warranties. The representations and warranties
made in Article VII of the Credit Agreement by Borrower to Lender are true and
correct as of the date of execution of this Second Amendment.
4. Defined Terms. Words and terms used herein which are defined in the
Credit Agreement are used herein as defined in the Credit Agreement, except as
specifically modified by the terms of this First Amendment. Any of the terms
used in this First Amendment which are not defined in the Credit Agreement shall
be used therein as herein defined.
5. Preservation of the Credit Agreement. Except as specifically modified
by the terms of this First Amendment, all of the terms, provisions, covenants,
warranties and agreements contained in the Credit Agreement shall remain in full
force and effect.
6. Applicable Law. This First Amendment shall be deemed to be a contract
made under, and shall be construed in accordance with, the laws of the State of
Texas.
7. Entire Agreement. The Credit Agreement as amended by this First
Amendment and the other Loan Papers contain the entire agreement between the
parties relating to the transactions contemplated hereby. All prior or
contemporaneous understandings, representations, statements and agreements,
whether written or oral, are merged herein and superseded by the Credit
Agreement as amended by this First Amendment. THIS WRITTEN AGREEMENT AND THE
OTHER LOAN PAPERS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND 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.
IN WITNESS WHEREOF, the parties have executed this First Amendment as of
the date first above written.
BORROWER:
DRIL-QUIP (EUROPE) LIMITED,
a private limited company formed
under the Corporation Act of the
United Kingdom 1948, as amended
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By:_________________________________
Printed Name:_______________________
Title: Director
By:_________________________________
Printed Name:_______________________
Title: Director
LENDER:
BANK ONE, TEXAS, NATIONAL
ASSOCIATION
By:_________________________________
Xxxxxx X. Xxxxxxxxx
Vice President
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EXHIBIT F
PROMISSORY NOTE
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$17,000,000.00 Houston, Texas December 20, 1994
FOR VALUE RECEIVED, the undersigned, DRIL-QUIP (EUROPE) LIMITED, a
private limited company formed under the Companies Act of the United Kingdom
1948, as amended ("Maker"), hereby promises to pay to the order of BANK ONE,
TEXAS, NATIONAL ASSOCIATION, a national banking association ("Payee"), at its
offices at 910 Travis, Houston, Xxxxxx County, Texas, on October 1, 1996, in
lawful money of the United States of America, the principal sum of SEVENTEEN
MILLION AND NO/100 DOLLARS ($17,000,000.00), or so much thereof as may be
advanced and outstanding hereunder, together with interest on the outstanding
principal balance hereof, at a varying rate per annum which shall from day to
day be equal to the lesser of (a) the maximum rate permitted by applicable law
as the same exists from day to day during the term hereof ("Maximum Rate"),
including, as to Article 5069-1.04, Vernon's Texas Civil Statutes (and as the
same may be incorporated by reference in other Texas statutes), but otherwise
without limitation, that rate based upon the "indicated rate ceiling" or (b) the
sum of the Bank One Base Rate (hereinafter defined) of Payee in effect from day
to day plus one-half of one percent (1/2%), each such change in the rate of
interest charged hereunder to become effective, without notice to Maker, on the
effective date of each change in the Bank One Base Rate; provided however, if at
any time the rate of interest specified in clause (b) preceding shall exceed the
Maximum Rate, thereby causing the interest rate hereon to be limited to the
Maximum Rate, then any subsequent reduction in the Bank One Base Rate will not
reduce the rate of interest hereon below the Maximum Rate until the total amount
of interest accrued hereon equals the amount of interest which would have
accrued hereon if the rate specified in clause (b) preceding had at all times
been in effect.
Accrued and unpaid interest shall be due and payable quarterly in
arrears during the term hereof, on the 1st day of each successive January,
April, July and October commencing on January 1, 1995, until payment in full of
the outstanding principal hereunder. All principal hereof, together with all
accrued and unpaid interest thereon, shall be due and payable on maturity. All
past due principal and interest shall bear interest at the Maximum Rate.
Whenever any payment hereunder shall be stated to be due on a day that
is not a day Payee is open for business, such payment may be made on the next
succeeding day Payee is open for business and interest shall continue to accrue
during such extension.
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As used herein, the term "Bank One Base Rate" means, at any time the
lesser of (i) the rate of interest per annum then most recently established by
Payee as its Bank One Base Rate in effect from day to day, with each change in
the rate of interest charged as the Bank One Base Rate to become effective,
without notice to Maker, on the effective date of each change in the Bank One
Base Rate, such Bank One Base Rate to be computed on the basis of a year
composed of 365 days for the actual number of days elapsed (including the first
day but excluding the last day) or (ii) the Maximum Rate (as herein defined).
This note is the Revolving Credit Note provided for and as defined in
that certain Credit Agreement dated March 30, 1994 as amended by First Amendment
to Credit Agreement dated of even date herewith by and among Maker and Payee
(such instruments as the same may be amended or modified from time to time, are
hereinafter referred to as the "Agreement").
Maker may prepay the principal of this note upon the terms and
conditions specified in the Agreement. Maker may borrow, repay and reborrow
hereunder upon the terms and conditions specified in the Agreement.
Notwithstanding anything to the contrary contained herein, no
provisions of this note shall require the payment or permit the collection of
interest in excess of the Maximum Rate. If any excess of interest in such
respect is herein provided for, or shall be adjudicated to be so provided, in
this note or otherwise in connection with this loan transaction the provisions
of this paragraph shall govern and prevail, and neither Maker nor the sureties,
guarantors, successors or assigns of Maker shall be obligated to pay the excess
amount of such interest, or any other excess sum paid for the use, forbearance
or detention of sums loaned pursuant hereto. If for any reason interest in
excess of the Maximum Rate shall be deemed charged, required or permitted by any
court of competent jurisdiction, any such excess shall be applied as a payment
and reduction of the principal of indebtedness evidenced by this note; and, if
the principal amount hereof has been paid in full, any remaining excess shall
forthwith be paid to Maker.
If default be made in the payment of principal or interest under this
note and such default shall continue for three (3) Business Days after notice
thereof to Maker pursuant to the Agreement, as defined in the Agreement, or upon
the occurrence of any other Event of Default, as such term is defined in the
Agreement, the holder hereof may, at its option, declare the entire unpaid
principal of and accrued interest on this note immediately due and payable
without additional notice, demand or presentment, all of which are hereby
waived, and upon such declaration, the same shall become and shall be
immediately due and payable, and the holder hereof shall have the right to
foreclose or otherwise enforce all liens or security interests securing any sum
or sums owed by the holder hereof to Maker. Failure of the holder hereof to
exercise this option shall not constitute a waiver of the right to exercise the
same upon the occurrence of a subsequent Event of Default.
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If the holder hereof expends any effort in any attempt to enforce
payment of all or any part or installment of any sum due the holder hereunder,
or if this note is placed in the hands of an attorney for collection, or if it
is collected through any legal proceedings, Maker agrees to pay all collection
costs and fees incurred by the holder, including reasonable attorneys' fees.
This note is performable in Houston, Xxxxxx County, Texas, and Maker
and each surety, guarantor, endorser and other party ever liable for payment of
any sums of money payable on this note, jointly and severally waive the right to
be sued hereon elsewhere. This note shall be governed by and construed in
accordance with the laws of the state of Texas and the applicable laws of the
United States of America.
Maker and each surety, guarantor, endorser and other party ever liable
for payment of any sums of money payable on this note jointly and severally
waive presentment and demand for payment, protest, notice of protest and non-
payment of dishonor, notice of acceleration, notice of intent to accelerate,
notice of intent to demand, diligence in collecting, and grace, and consent to
all extensions without notice for any period or periods of time and partial
payments, before or after maturity, without prejudice to the holder. Maker
acknowledges and understands that under the laws of the State of Texas, unless
waived, Maker has the right to notice of Payee's intent to accelerate the
indebtedness evidenced by this note, the right to notice of the actual
acceleration of the indebtedness evidenced by this note, and the right to
presentment of this note by Payee's demand for payment. Maker acknowledges that
it understands that it can waive these rights and by Maker's execution of this
note it agrees to waive its right to notice of intent to accelerate, its right
to notice of acceleration, and its right to presentment or other demand for
payment. The holder shall similarly have the right to deal in any way, at any
time, without one or more of the foregoing parties without notice to any other
party, and to grant any such party and extensions of time for payment of any of
said indebtedness, or to release part or all of the collateral securing this
note, or to grant any other indulgences or forbearances whatsoever, without
notice to any other party and without in any way affecting the personal
liability of any party hereunder.
This note is executed in renewal and extension, but not in novation or
discharge, of that certain Promissory Note dated March 30, 1994, in the original
principal amount of $15,000,000.00, executed by Maker for the benefit of Payee.
Maker hereby authorizes the holder hereof to endorse on the Schedule
attached to this note or any continuation thereof, all advances made to Maker
hereunder and all payments made on account of the principal thereof, which
endorsements shall be prima facie evidence as to the outstanding principal
amount of this note; provided, however, any failure by the holder hereof to make
endorsement shall not limit or otherwise affect the obligations of Maker under
the Agreement or this note.
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DRIL-QUIP (EUROPE) LIMITED
By:________________________________
Printed Name:______________________
Title: Director
By:________________________________
Printed Name:______________________
Title: Director
Page 4 of a 4 Page Note
