EXHIBIT 10.4

AMENDMENT NO. 4 TO
LOAN AND SECURITY AGREEMENT
AMENDMENT NO. 4 TO LOAN AND SECURITY AGREEMENT, dated as of May 15, 2020 (this
“Amendment”), is by and among Forbes Energy Services LLC, a Delaware limited
liability company (the “Borrower”), the Guarantors listed on the signature pages
hereto, the Lenders party hereto, and Wilmington Trust, National Association, as
agent for the Secured Parties under the Loan Agreement (as defined below) (the
“Agent”).
W I T N E S S E T H :
WHEREAS, the Borrower, the Guarantors (together with the Borrower, the “Loan
Parties”), the Lenders and the Agent are parties to financing arrangements
pursuant to which the Lenders have made and may make loans and advances and
provide other financial accommodations to the Borrower as set forth in the Loan
and Security Agreement, dated as of April 13, 2017, by and among the Loan
Parties, the Lenders and the Agent (as amended, restated, supplemented or
otherwise modified from time to time, including pursuant to this Amendment, the
“Loan Agreement”); and
WHEREAS, subject to the conditions set forth herein, the Lenders party hereto,
constituting the Required Lenders, are willing to consent to the amendments to
the Loan Agreement set forth in this Amendment.
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements and
covenants contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Definitions. Unless otherwise defined herein, capitalized terms or matters of
construction defined or established in the Loan Agreement shall be applied
herein as defined or established therein.
2. Amendments to Loan Agreement.
(a) Section 1.02 of the Loan Agreement is hereby amended by adding the following
definitions:
“CARES Act - Title I” shall mean Title I of the Coronavirus Aid, Relief and
Economic Security Act, as amended (including any successor thereto), and all
requests, rules, guidelines, requirements and directives thereunder or issued in
connection therewith or in implementation thereof, regardless of the date
enacted, adopted, issued or implemented.
“Small Business Administration” shall mean the U.S. Small Business
Administration.
(b) The third sentence of Section 2.07(a) of the Loan Agreement is hereby
amended and restated in its entirety as follows:
Notwithstanding the foregoing, unless and until an Event of Default has occurred
and is continuing or would result therefrom, such proceeds from Dispositions and
insurance payments that do not exceed $5,000,000 in the aggregate in any fiscal
year may be retained by Loan Parties solely to acquire replacement assets or to
enhance, refurbish or otherwise increase the value of existing assets without
making a mandatory prepayment hereunder so long as (1) the fair market value of
the acquired assets, or the value of the enhancements, refurbishments or other
value added to existing assets, is equal to or greater than the fair market
value of the assets which were Disposed or subject to the insurance payment, as
applicable, and (2) the acquired assets are purchased, or the existing assets
are enhanced, refurbished or otherwise increased in value, by the applicable
Loan Party within one year of the Disposition of the assets or receipt of the
insurance payment, as applicable.
(c) Section 7.07 of the Credit Agreement is hereby amended (i) to delete the
word “and” at the end of clause (n) thereof, (ii) to replace “.” with “; and” at
the end of clause (o) thereof, (iii) to replace “(n)” with “(p)” in the last
paragraph thereof, and (iii) to add a new clause (p) as follows:
(p) Indebtedness in an aggregate principal amount not to exceed $10,000,000
advanced by (i) any Governmental Body (including the Small Business
Administration) or any other Person acting as a financial agent of a
Governmental Body or (ii) any other Person to the extent such Indebtedness under
this clause (ii) is guaranteed by a Governmental Body (including the Small
Business Administration), in each case under this clause (p), pursuant to the
CARES Act - Title I.
(d) The first sentence of Section 9.07 of the Loan Agreement is hereby
amended and restated in its entirety as follows:
Furnish Agent and each Lender with respect to each of Loan Parties’ fiscal
quarters, on or before the later to occur of (a) forty-five (45) days after the
end of such fiscal quarter (or, if such due date is not a Business Day, then on
the next Business Day), and (b) at any time when Parent is a reporting company
under the Exchange Act, the date on which the Loan Parties filed their SEC Form
10-Q for such fiscal quarter, an unaudited balance sheet of Loan Parties and
their Subsidiaries on a consolidated and consolidating basis and unaudited
statements of income of Loan Parties and their Subsidiaries on a consolidated
and consolidating basis reflecting results of operations from the beginning of
the fiscal year to the end of such fiscal quarter and for such fiscal quarter,
prepared on a basis consistent with prior practices and complete and correct in
all material respects, subject to normal and recurring year-end adjustments that
individually and in the aggregate are not material to the business of Loan
Parties or their Subsidiaries.
3. Representations and Warranties. Each Loan Party represents and warrants to
the Agent and the Lenders party hereto as follows:
(a) this Amendment has been duly executed and delivered by each Loan Party, and
is a legally valid and binding obligation of such Loan Party, enforceable
against such Loan Party in accordance with its terms, except as enforcement may
be limited by equitable principles or by bankruptcy, insolvency, reorganization,
moratorium, or similar laws relating to or limiting creditors’ rights generally;
and
(b) the execution, delivery and performance of this Amendment and the
transactions contemplated hereunder (i) are all within each Loan Party’s limited
liability company or corporate powers, as applicable, (ii) have been duly
authorized by such Loan Party, (iii) are not in contravention of law or the
terms of such Loan Party’s certificate of formation, limited liability company
agreement, certificate of incorporation, by-laws or other applicable constituent
documents or of any material agreement or undertaking to which such Loan Party
is a party or by which such Loan Party is bound and (iv) will not materially
conflict with nor result in any material breach in any of the provisions of or
constitute a default under or result in the creation of any Lien except
Permitted Encumbrances upon any asset of such Loan Party under the provisions of
any agreement or instrument to which such Loan Party or its property is a party
or by which it may be bound.
4. Acknowledgments by Guarantors. Each Guarantor hereby expressly and
specifically ratifies, restates and confirms the terms and conditions of the
Guarantee in favor of the Agent and Lenders and its liability for all of the
obligations under the Guarantee by such Guarantor, and all other obligations,
liabilities, agreements and covenants thereunder. Each Guarantor, by its
signature below, hereby acknowledges, confirms and agrees that the Guarantee
executed by the Guarantors, guaranteeing the payment and performance of the
Borrower as set forth in the Guarantee and all other obligations, liabilities,
agreements and covenants thereunder, is in full force and effect as of the
Amendment Effective Date.
5. Conditions Precedent. This Amendment shall be effective upon the satisfaction
of each of the following conditions precedent on the date hereof (the “Amendment
Effective Date”):
(a) Amendment. The Agent shall have received this Amendment duly executed and
delivered by an authorized officer of each of the parties hereto;
(b) Expenses. The Agent shall have received all reimbursable expenses of the
Agent (including fees, disbursements and expenses of its counsel) invoiced to
date in accordance with the Loan Agreement;
(c) Representations and Warranties. Each of the representations and warranties
made by any Loan Party in or pursuant to the Loan Agreement and any Other
Document to which it is a party, and each of the representations and warranties
contained in any certificate, document or financial or other statement furnished
at any time under or in connection with the Loan Agreement or any Other Document
shall be true and correct in all material respects (without duplication of any
materiality qualifiers already set forth therein) on and as of such date as if
made on and as of such date, except to the extent that such representations and
warranties expressly relate solely to an earlier date (in which case such
representations and warranties shall have been true and correct in all material
respects (without duplication of any materiality qualifiers already set forth
therein) on and as of such earlier date); and
(d) No Default. No Event of Default or Default shall have occurred and be
continuing on the Amendment Effective Date, or would exist after giving effect
to the transactions described in this Amendment on the Amendment Effective Date.
6. General.
(a) Effect of this Amendment. Except as expressly provided herein, no other
consents, waivers, changes or modifications to the Loan Agreement or any Other
Documents (together, the “Loan Documents”) are intended or implied, and in all
other respects the Loan Documents are hereby specifically ratified, restated and
confirmed by all parties hereto as of the date hereof. To the extent of conflict
between the terms of this Amendment and the other Loan Documents, the terms of
this Amendment shall control. The Loan Agreement shall be read and construed as
one agreement with this Amendment.
(b) Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of New York applied to contracts to be
performed wholly within the State of New York, without regard to conflicts of
laws principles.
(c) Binding Effect. This Amendment shall bind and inure to the benefit of the
respective successors and permitted assigns of each of the parties hereto.
(d) Counterparts, etc. This Amendment may be executed in any number of and by
different parties hereto on separate counterparts, all of which, when so
executed, shall be deemed an original, but all such counterparts shall
constitute one and the same agreement. Any signature delivered by a party by
facsimile or email transmission shall be deemed to be an original signature
hereto.
(e) Direction. The Lenders party hereto, constituting the Required Lenders,
hereby direct the Agent to execute and deliver this Amendment, and, by their
execution below, each of the undersigned Lenders agrees to be bound by the terms
and conditions of this Amendment.
[Signature Pages Follow]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered by their authorized officers as of the day and year first
above written.

 
BORROWER

   
FORBES ENERGY SERVICES LLC
              

By:
/s/ L. Melvin Cooper
    Name: 
L. Melvin Cooper     Title:

Senior Vice President, Chief Financial Officer

and Assistance Secretary

 

[Signature Page to Fourth Amendment to Term Loan Agreement]

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GUARANTORS

   
FORBES ENERGY SERVICES LTD.
        

By:
/s/ L. Melvin Cooper
    Name: 
L. Melvin Cooper     Title:

Senior Vice President, Chief Financial Officer

and Assistance Secretary

         

 
C.C. FORBES, LLC
        

By:
/s/ L. Melvin Cooper
    Name: 
L. Melvin Cooper     Title:

Senior Vice President, Chief Financial Officer

and Assistance Secretary

         

 
TX ENERGY SERVICES, LLC
        

By:
/s/ L. Melvin Cooper
    Name: 
L. Melvin Cooper     Title:

Senior Vice President, Chief Financial Officer

and Assistance Secretary

         

 
FORBES ENERGY INTERNATIONAL, LLC

        

By:
/s/ L. Melvin Cooper
    Name: 
L. Melvin Cooper     Title:

Senior Vice President, Chief Financial Officer

and Assistance Secretary

         

 
CRETIC ENERGY SERVICES, LLC

        

By:
/s/ L. Melvin Cooper
    Name: 
L. Melvin Cooper     Title:

Senior Vice President, Chief Financial Officer

and Assistance Secretary

 

[Signature Page to Fourth Amendment to Term Loan Agreement]

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ADMINISTRATIVE AGENT

   
WILMINGTON TRUST, NATIONAL
ASSOCIATION

        

By:
/s/ David Bergstrom
    Name: 
David Bergstrom     Title:
Vice President
         

[Signature Page to Fourth Amendment to Term Loan Agreement]

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LENDERS

    ASCRIBE III INVESTMENTS LLC         

By:
/s/ Lawrence First
    Name: 
Lawrence First     Title:
Managing Director
         

[Signature Page to Fourth Amendment to Term Loan Agreement]

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LENDERS

    SOLACE FORBES HOLDINGS LLC
           By:  Solce Capital Partners LP
       

By:
/s/ Naeem Arastu
    Name: 
Naeem Arastu     Title:
Managing Director
         

[Signature Page to Fourth Amendment to Term Loan Agreement]