Exhibit 10.1

 

THIRD AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT

 

THIS THIRD AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT (this
“Amendment”), dated as of December 10, 2013, is entered into by and among the
Lenders signatory hereto, PNC BANK, NATIONAL ASSOCIATION, in its capacity as
agent for the Lenders (in such capacity “Agent”), ENERGY SERVICES LP, a Delaware
limited partnership (“Parent Guarantor”), EMERGE ENERGY SERVICES OPERATING LLC,
a Delaware limited liability company (“Emerge”), SUPERIOR SILICA SANDS LLC, a
Texas limited liability company (“SSS”), DIRECT FUELS LLC, a Delaware limited
liability company formerly known as Insight Equity Acquisition Partners, LP
(“Direct Fuels”), ALLIED ENERGY COMPANY LLC, an Alabama limited liability
company (“AEC”), ALLIED RENEWABLE ENERGY, LLC, a Delaware limited liability
company (“ARE”), EMERGE ENERGY DISTRIBUTORS INC., a Delaware corporation (“EED”
and together with Emerge, SSS, Direct Fuels, AEC, ARE and each Person joined
hereto as a borrower from time to time, collectively, the “Borrowers”, and each
individually a “Borrower”).  Terms used herein without definition shall have the
meanings ascribed to them in the Credit Agreement defined below.

 

RECITALS

 

A.                                    The Lenders, Agent, Parent Guarantor and
Borrowers have previously entered into that certain Revolving Credit and
Security Agreement, dated as of May 14, 2013, as amended by that certain First
Amendment to Revolving Credit and Security Agreement, dated as of May 23, 2013
and that certain Second Amendment to Revolving Credit and Security Agreement,
dated as of December 3, 2013 (as amended, and as further amended, modified and
supplemented from time to time, the “Credit Agreement”), pursuant to which the
Lenders have made certain loans and financial accommodations available to
Borrowers.

 

B.                                    The Lenders, Agent, Parent Guarantor and
Borrowers now wish to further amend the Credit Agreement on the terms and
conditions set forth herein.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

 

1.                                      Amendments to Credit Agreement.

 

(a)                                 The following defined term is hereby added
to Section 1.2 of the Credit Agreement in its proper alphabetical order:

 

“ “Third Amendment” shall mean that certain Third Amendment to Revolving Credit
and Security Agreement, dated December 10, 2013, by and among Parent Guarantor,
the Borrowers signatory thereto, Agent and the Lenders signatory thereto.”

 

(b)                                 The defined term “Commitment Amount” set
forth in Section 1.2 of the Credit Agreement is hereby amended and restated to
read in its entirety as follows:

 

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“ “Commitment Amount” shall mean, as to each Lender, the Commitment Amount (if
any) set forth below such Lender’s name on its signature page to the Third
Amendment (or, in the case of any Lender that became party to this Agreement
after the date of the Third Amendment pursuant to Section 16.3(c) or (d) hereof,
the Commitment Amount (if any) of such Lender as set forth in the applicable
Commitment Transfer Supplement), in each case as the same may be adjusted upon
any assignment by or to such Lender pursuant to Section 16.3(c) or (d) hereof.”

 

(c)                                  The defined term “Commitment Percentage”
set forth in Section 1.2 of the Credit Agreement is hereby amended and restated
to read in its entirety as follows:

 

“ “Commitment Percentage” shall mean, as to each Lender, the Commitment
Percentage (if any) set forth below such Lender’s name on its signature page to
the Third Amendment (or, in the case of any Lender that became party to this
Agreement after the date of the Third Amendment pursuant to Section 16.3(c) or
(d) hereof, the Commitment Percentage (if any) of such Lender as set forth in
the applicable Commitment Transfer Supplement), in each case as the same may be
adjusted upon any assignment by or to such Lender pursuant to Section 16.3(c) or
(d) hereof.”

 

(d)                                 The defined term “Maximum Revolving Advance
Amount” set forth in Section 1.2 of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:

 

“ “Maximum Revolving Advance Amount” shall mean $200,000,000, as such amount
may, as of any date of determination, be decreased pursuant to Section 2.21
hereof.”

 

(e)                                  Section 6.12 of the Credit Agreement is
hereby amended and restated to read in its entirety as follows:

 

6.12                        Post-Closing Deliveries.

 

(a)                                 Borrowers shall satisfy the requirements set
forth on Schedule 6.12 on or before the applicable date therefor (or such later
date as Agent may agree).

 

(b)                                 Within thirty (30) days or such longer
period, not to exceed ninety (90) days in the aggregate after the date of the
Third Amendment, as the Agent may agree to, Borrowers shall deliver to Agent
with respect to each Mortgage (a) duly executed mortgage modification
agreements, and (b) either (i) an endorsement to the final title insurance
policy previously issued by First American Title Insurance Company (the “Title
Company”) in favor of Agent, or (ii) a new title policy issued by the Title
Company in favor of Agent insuring Agent’s first priority fee or leasehold (as
applicable) mortgage lien.

 

(c)                                  Within thirty (30) days or such longer
period, not to exceed ninety (90) days in the aggregate after the date of the
Third Amendment, as the Agent may agree to, Agent shall have received the
executed legal opinions, each in form and substance satisfactory to Agent of
each of Jones Walker LLP, Balch &

 

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Bingham and Hinshaw & Culbertson which shall cover such matters incident to the
transactions contemplated by the Third Amendment as Agent may reasonably
require, and the Credit Parties hereby authorize and direct such counsel to
deliver such opinions to Agent and Lenders.

 

2.                                      Joinder of New Lenders.

 

(a)                                 Each person signatory hereto as a New Lender
agrees that, upon the effectiveness of this Amendment, from and after the date
hereof, it shall become, and shall be deemed to be, a Lender under the Credit
Agreement and each of the Other Documents and agrees that from the date hereof
and so long as the New Lender remains a party to the Credit Agreement, such New
Lender shall assume the obligations of a Lender under and perform, comply with
and be bound by each of the provisions of the Credit Agreement which are stated
to apply to a Lender and shall be entitled to the benefits, rights and remedies
set forth therein and in each of the Other Documents.  Each New Lender hereby
acknowledges that it has heretofore received a true and correct copy of the
Credit Agreement (including all amendments thereto) as in effect on the date
hereof and the executed original of its Revolving Credit Note dated the date
hereof issued by the Borrowers under the Agreement in a face amount equal to its
Commitment Amount as set forth on its signature page hereto.  The Commitment
Amount and Commitment Percentage of each New Lender are as set forth on its
signature page hereto.  Each New Lender confirms that it has delivered all
documents required by Section 3.10 of the Credit Agreement.

 

(b)                                 Agent and each Borrower, by its signature
hereto, hereby consents to each New Lender’s joinder to the Credit Agreement and
the Other Documents as a Lender.

 

3.                                      Effectiveness of this Amendment.  The
following conditions shall have been satisfied, as determined by Agent, before
this Amendment is effective:

 

(a)                                 Agent shall have received this Amendment,
fully executed by each Credit Party, each New Lender and Lenders constituting
Required Lenders;

 

(b)                                 Agent shall have received, in form and
substance satisfactory to Agent a Revolving Credit Note for each New Lender,
duly executed by the Borrowers;

 

(c)                                  Agent shall have received, in form and
substance satisfactory to Agent: (i) that certain Fee Letter among Borrowers,
Agent and Santander Bank, National Association dated as of the date hereof, duly
executed by the parties thereto, (ii) that certain Fee Letter among Borrowers,
Agent and Branch Banking and Trust Company dated as of the date hereof duly
executed by the parties thereto (the fee letters described in the foregoing
clauses (i) and (ii), collectively, the “ New Lender Fee Letters”), and
(iii) payment of all fees described in the New Lender Fee Letters;

 

(d)                                 Each of the representations and warranties
made by any Credit Party in or pursuant to this Amendment, the Credit Agreement
and the Other Documents shall be true and correct in all material respects (or,
if such representation and warranty is, by its terms, limited by materiality
(including a Material Adverse Effect), then such representation and warranty
shall be true in all respects) on and as of the date hereof as if made on and as
of the date hereof (except to the extent any such representation or warranty
specifically relates to a certain prior date);

 

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(e)                                  Agent shall have received (i) a copy of the
resolutions in form and substance reasonably satisfactory to Agent, of the board
of directors, management committee, managing member, manager or general partner,
as applicable, of each Credit Party authorizing (as applicable) the execution,
delivery and performance of this Amendment and the Other Documents contemplated
to be delivered by such Credit Party in connection herewith, certified by an
Authorized Officer of each Credit Party as of the date hereof, and, such
certificate shall state that the resolutions thereby certified have not been
amended, modified, revoked or rescinded as of the date of such certificate and
(ii) a certificate of an Authorized Officer of each Credit Party, dated the date
hereof, as to the incumbency and signature of the officers of each Credit Party,
as applicable, executing this Amendment and the Other Documents contemplated to
be delivered by such Credit Party in connection herewith, together with evidence
of the incumbency of such Authorized Officer, in each case certified by an
Authorized Officer of each Credit Party as of the date hereof;

 

(f)                                   Agent shall have received the executed
legal opinion, in form and substance satisfactory to Agent of Latham & Watkins,
LLP, which shall cover such matters incident to the transactions contemplated by
this Amendment as Agent may reasonably require, and the Credit Parties hereby
authorize and direct such counsel to deliver such opinions to Agent and Lenders;
and

 

(g)                                  All other documents and legal matters in
connection with the transactions contemplated by this Amendment shall have been
delivered or executed or recorded, as required by Agent.

 

4.                                      Representations and Warranties.  Each
Credit Party represents and warrants as follows:

 

(a)                                 Authority.  Such Loan Party has the
requisite corporate power and authority to execute and deliver this Amendment,
and to perform its obligations hereunder and under the Other Documents (as
amended or modified hereby) to which it is a party.  The execution, delivery and
performance by such Loan Party of this Amendment have been duly approved by all
necessary corporate action and no other corporate proceedings are necessary to
consummate such transactions.

 

(b)                                 Enforceability.  This Amendment has been
duly executed and delivered by each Loan Party.  This Amendment and each Other
Document (as amended or modified hereby) is the legal, valid and binding
obligation of each Loan Party, enforceable against each Loan Party in accordance
with its terms, and is in full force and effect.

 

(c)                                  Due Execution.  The execution, delivery and
performance of this Amendment are within the power of each Loan Party, have been
duly authorized by all necessary corporate action, have received all necessary
governmental approval, if any, and do not contravene any law or any contractual
restrictions binding on any Loan Party.

 

(d)                                 No Default.  No Event of Default or Default
has occurred and is continuing.

 

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5.                                      Choice of 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.

 

6.                                      Counterparts; Electronic Signatures. 
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 other similar
method of electronic transmission shall be deemed to be an original signature
hereto.

 

7.                                      Reference to and Effect on the Other
Documents.

 

(a)                                 Upon and after the effectiveness of this
Amendment, each reference in the Credit Agreement to “this Agreement”,
“hereunder”, “hereof” or words of like import referring to the Credit Agreement,
and each reference in the Other Documents to “the Credit Agreement”, “thereof”
or words of like import referring to the Credit Agreement, shall mean and be a
reference to the Credit Agreement as modified and amended hereby.

 

(b)                                 Except as specifically amended above, the
Credit Agreement and all Other Documents, are and shall continue to be in full
force and effect and are hereby in all respects ratified and confirmed and shall
constitute the legal, valid, binding and enforceable obligations of Borrowers to
Agent and the Lenders.

 

(c)                                  The execution, delivery and effectiveness
of this Amendment shall not, except as expressly provided herein, operate as a
waiver of any right, power or remedy of the Agent and/or the Lenders under any
of the Other Documents, nor constitute a waiver of any provision of any of the
Other Documents.

 

(d)                                 To the extent that any terms and conditions
in any of the Other Documents shall contradict or be in conflict with any terms
or conditions of the Credit Agreement, after giving effect to this Amendment,
such terms and conditions are hereby deemed modified or amended accordingly to
reflect the terms and conditions of the Credit Agreement as modified or amended
hereby.

 

8.                                      Estoppel.  To induce Agent and the
Lenders to enter into this Amendment and to continue to make advances to
Borrowers under the Credit Agreement, each Loan Party hereby acknowledges and
agrees that, as of the date hereof, there exists no right of offset, defense,
counterclaim or objection in favor of Borrower as against Agent or any Lender
with respect to the Obligations.

 

9.                                      Integration.  This Amendment, together
with the Credit Agreement and the Other Documents, incorporates all negotiations
of the parties hereto with respect to the subject matter hereof and is the final
expression and agreement of the parties hereto with respect to the subject
matter hereof.

 

10.                               Severability.  If any part of this Amendment
is contrary to, prohibited by, or deemed invalid under Applicable Laws or
regulations, such provision shall be inapplicable and

 

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deemed omitted to the extent so contrary, prohibited or invalid, but the
remainder hereof shall not be invalidated thereby and shall be given effect so
far as possible.

 

11.                               Submission of Amendment.  The submission of
this Amendment to the parties or their agents or attorneys for review or
signature does not constitute a commitment by Agent or the Lenders to increase
any of their Commitment Amounts, and this Amendment shall have no binding force
or effect until all of the conditions to the effectiveness of this Amendment
have been satisfied as set forth herein.

 

12.                               Guarantors’ Acknowledgment.  With respect to
the amendments to the Credit Agreement effected by this Amendment, each
Guarantor hereby acknowledges and agrees to this Amendment and confirms and
agrees that its Guaranty (as modified and supplemented in connection with this
Amendment) is and shall continue to be, in full force and effect and is hereby
ratified and confirmed in all respects except that, upon the effectiveness of,
and on and after the date of this Amendment, each reference in such Guaranty to
the Credit Agreement, “thereunder”, “thereof” or words of like import referring
to the Credit Agreement, shall mean and be a reference to the Credit Agreement
as amended or modified by this Amendment.  Although Agent and the Lenders have
informed the Guarantors of the matters set forth above, and each Guarantor has
acknowledged the same, each Guarantor understands and agrees that neither Agent
nor any Lender has any duty under the Credit Agreement, the Guaranty or any
other agreement with any Guarantor to so notify any Guarantor or to seek such an
acknowledgement, and nothing contained herein is intended to or shall create
such a duty as to any transaction hereafter.

 

[signature pages follow]

 

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IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date
first above written.

 

PARENT GUARANTOR:

EMERGE ENERGY SERVICES LP,

 

a Delaware limited partnership

 

 

 

 

By:

EMERGE ENERGY SERVICES GP LLC,

 

 

 

a Delaware limited liability company

 

 

Its:

General Partner

 

 

 

 

 

 

By:

  /s/ Warren B. Bonham

 

 

Name:

Warren B. Bonham

 

 

Title:

Vice President

 

 

 

 

BORROWERS:

EMERGE ENERGY SERVICES OPERATING LLC,

 

a Delaware limited liability company

 

 

 

 

 

By:

  /s/ Warren B. Bonham

 

 

Name:

Warren B. Bonham

 

 

Title:

Vice President

 

 

 

 

 

SUPERIOR SILICA SANDS LLC,

 

a Texas limited liability company

 

 

 

 

 

By:

  /s/ Richard Shearer

 

 

Name:

Richard Shearer

 

 

Title:

President and Chief Executive Officer

 

 

 

 

 

DIRECT FUELS LLC,

 

a Delaware limited liability company

 

 

 

By:

Emerge Energy Services Operating LLC,

 

 

its sole member

 

 

 

By:

  /s/ Warren B. Bonham

 

 

Name:

Warren B. Bonham

 

 

Title:

Vice President

 

Signature Page to Third Amendment to Revolving Credit and Security Agreement

 

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ALLIED ENERGY COMPANY LLC,
an Alabama limited liability company

 

 

 

 

 

By:

/s/ Richard L. DeShazo

 

 

Name:

Richard L. DeShazo

 

 

Title:

President and Chief Financial Officer

 

 

 

 

 

ALLIED RENEWABLE ENERGY, LLC,
an Alabama limited liability company

 

 

 

 

 

By:

/s/ Richard L. DeShazo

 

 

Name:

Richard L. DeShazo

 

 

Title:

President and Chief Financial Officer

 

 

 

 

 

EMERGE ENERGY DISTRIBUTORS INC.,
a Delaware corporation

 

 

 

 

 

By:

/s/ Warren B. Bonham

 

Name:

Warren B. Bonham

 

Title:

Vice President

 

Signature Page to Third Amendment to Revolving Credit and Security Agreement

 

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AGENT AND A LENDER:

PNC BANK, NATIONAL ASSOCIATION

 

 

 

 

 

By:

/s/ Ron Eckhoff

 

 

Name:

Ron Eckhoff

 

 

Title:

Vice President

 

 

 

Commitment Percentage: 35%

 

Commitment Amount: $70,000,000

 

Signature Page to Third Amendment to Revolving Credit and Security Agreement

 

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A NEW LENDER:

SANTANDER BANK, NATIONAL ASSOCIATION

 

 

 

 

 

By:

/s/ Aidan Lanigan

 

 

Name:

Aidan Lanigan

 

 

Title:

Senior Vice President

 

 

 

 

By:

/s/ Puiki Lok

 

 

Name:

Puiki Lok

 

 

Title:

Vice President

 

 

 

 

Commitment Percentage: 12.5%

 

Commitment Amount: $25,000,000

 

Signature Page to Third Amendment to Revolving Credit and Security Agreement

 

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A NEW LENDER:

BRANCH BANKING AND TRUST COMPANY

 

 

 

 

 

By:

/s/ Larry Trussell

 

 

Name:

Larry Trussell

 

 

Title:

Senior Vice President

 

 

 

 

Commitment Percentage: 12.5%

 

Commitment Amount: $25,000,000

 

Signature Page to Third Amendment to Revolving Credit and Security Agreement

 

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A LENDER:

WELLS FARGO BANK, N.A.

 

 

 

 

 

By:

/s/ Kristen Brockman

 

 

Name:

Kristen Brockman

 

 

Title:

Vice President

 

 

 

 

Commitment Percentage: 17.5%

 

Commitment Amount: $35,000,000

 

Signature Page to Third Amendment to Revolving Credit and Security Agreement

 

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A LENDER:

BANK OF AMERICA, N.A.

 

 

 

 

 

By:

/s/ Julie Castano

 

 

Name:

Julie Castano

 

 

Title:

Senior Vice President

 

 

 

 

Commitment Percentage: 15%

 

Commitment Amount: $30,000,000

 

Signature Page to Third Amendment to Revolving Credit and Security Agreement

 

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A LENDER:

STIFEL BANK & TRUST

 

 

 

 

 

By:

/s/ John H. Phillips

 

 

Name:

John H. Phillips

 

 

Title:

Executive Vice President

 

 

 

 

Commitment Percentage: 7.5%

 

Commitment Amount: $15,000,000

 

Signature Page to Third Amendment to Revolving Credit and Security Agreement

 

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