Exhibit 10.1

 

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FIRST AMENDMENT

 

TO

 

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

 

among

 

NEWPARK RESOURCES, INC.,

as Borrower,

 

THE SUBSIDIARY GUARANTORS,

 

THE LENDERS FROM TIME TO TIME PARTIES HERETO,

 

and

 

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

 

BANK OF AMERICA, N.A.,

as Syndication Agent

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Documentation Agent

 

Dated as of December 18, 2015

 

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First Amendment to Third Amended and Restated Credit Agreement 

 

This First Amendment to Third Amended and Restated Credit Agreement (this “First
Amendment”) dated as of December 18, 2015, is executed by Newpark Resources,
Inc., a Delaware corporation, (the “Borrower”), each of the undersigned
Subsidiary Guarantors, each of the undersigned Lenders party to the Credit
Agreement referred to below, and JPMorgan Chase Bank, N.A., as administrative
agent for the Lenders (in such capacity, together with its successors in such
capacity, the “Administrative Agent”).

 

R E C I T A L S

 

A.     The Borrower, the Administrative Agent, the Lenders and the other Agents
party thereto are parties to that certain Third Amended and Restated Credit
Agreement dated as of March 6, 2015 (the “Credit Agreement”), pursuant to which
the Lenders have made certain credit and other financial accommodations
available to and on behalf of the Borrower and its Subsidiaries.

 

B.     The Borrower has requested, and the Administrative Agent and the Majority
Lenders have agreed, to amend certain provisions of the Credit Agreement.

 

C.     The Borrower has previously provided notice to the Administrative Agent
that the Borrower has determined to reduce the Commitments as provided for in
Section 2.4 as of the First Amendment Effective Date and wishes to confirm such
notice herein.

 

D.     Now, therefore, to induce the Administrative Agent and the Majority
Lenders to enter into this First Amendment and in consideration of the premises
and for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

 

1.     Defined Terms. Each capitalized term used herein (including, without
limitation, in the recitals hereof) but not otherwise defined herein has the
meaning given such term in the Credit Agreement, as amended by this First
Amendment. Unless otherwise indicated, all section references in this First
Amendment refer to sections of the Credit Agreement.

 

2.     Notice of Reduction of Commitments. The Borrower has previously provided
and hereby confirms its prior notice to the Administrative Agent that, in
accordance with Section 2.4, the Borrower has elected to reduce the Total
Commitments to $150,000,000.00 as of the First Amendment Effective Date, and the
Administrative Agent and the Lenders hereby confirm receipt of such notice.

 

3.     Amendments to Credit Agreement.

 

(a)     Amendment to Section 1.1. Section 1.1 is hereby amended by amending and
restating the following definitions in their entirety:

 

“Agreement”: this Third Amended and Restated Credit Agreement, as amended by
that First Amendment dated as of December 18, 2015, and as the same may from
time to time be further amended, modified, supplemented or restated.

 

 
 

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“Applicable Pricing Grid”: the table set forth below:

 

Level

Consolidated Leverage Ratio

Libor Margin

ABR Margin

Commitment Fee Rate

I

Less than 1.00x

1.75%

0.75%

0.375%

II

Greater than or equal to 1.00x but less than 1.50x

2.00%

1.00%

0.375%

III

Greater than or equal to 1.50x but less than 2.00x

2.25%

1.25%

0.375%

IV

Greater than or equal to 2.00x but less than 2.50x

2.50%

1.50%

0.375%

V

Greater than or equal to 2.50x but less than 3.25x

3.00%

2.00%

0.50%

VI

Greater than or equal to 3.25x

3.25%

2.25%

0.50%

 

 

For purposes of the Applicable Pricing Grid, changes in the Applicable Margin
and/or the Commitment Fee Rate resulting from changes in the Consolidated
Leverage Ratio shall become effective on the date (the “Adjustment Date”) that
is three Business Days after the date on which financial statements are
delivered to the Lenders pursuant to Section 6.1 and shall remain in effect
until the next change to be effected pursuant to this paragraph. If any
financial statements referred to above are not delivered within the time periods
specified in Section 6.1, then, until the date that is three Business Days after
the date on which such financial statements are delivered, the highest rate set
forth in each column of the Applicable Pricing Grid shall apply. In addition, at
all times while an Event of Default shall have occurred and be continuing, the
highest rate set forth in each column of the Applicable Pricing Grid shall
apply. Each determination of the Consolidated Leverage Ratio for purposes of the
Applicable Pricing Grid shall be made in a manner consistent with the
determination thereof pursuant to Section 7.1.

 

“Commitment”: as to any Lender, the obligation of such Lender to make Revolving
Loans, participate in Letters of Credit and to acquire participations in
Swingline Loans in an aggregate principal and/or face amount not to exceed the
amount set forth under the heading “Commitment” opposite such Lender’s name on
Schedule 1.1(a), or in the Assignment and Assumption or Augmenting Lender
Supplement pursuant to which such Lender became a party hereto, as the same may
be changed from time to time pursuant to the terms hereof. The amount of the
Total Commitments as of the First Amendment Effective Date is $150,000,000.00.

 

 
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“Commitment Fee Rate”: the rate per annum determined pursuant to the Applicable
Pricing Grid.

 

“Consolidated EBITDA”: for any period, Consolidated Net Income for such period
plus, without duplication and to the extent reflected as a charge in the
statement of such Consolidated Net Income for such period, the sum of (a) tax
expense (excluding sales taxes and ad valorem taxes on real property), (b)
interest expense, amortization or writeoff of debt discount and debt issuance
costs and commissions, discounts and other fees and charges associated with
Indebtedness (including the Loans), (c) depreciation and amortization expense,
(d) amortization of intangibles (including, but not limited to, goodwill) and
organization costs, (e) any extraordinary or non-recurring non-cash expenses or
losses (including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, non-cash losses on
sales of assets outside of the ordinary course of business), (f) any non-cash
Capital Stock based compensation expenses, and (g) (i) severance payments, early
retirement or voluntary retirement payments and other payments made with respect
to the separation of any officers, employees or directors of the Borrower or its
Subsidiaries from the Borrower or any such Subsidiary, together with costs and
expenses related thereto for benefits, including, without limitation, health
insurance (collectively, the “Severance Add-Back”) and (ii) non-cash costs and
expenses related to the Brazil Debt Activity (collectively, the “Brazil Debt
Activity Add-Back”), provided, however, that (y) Borrower shall not be required
to add-back either the Severance Add-Back or any part thereof or the Brazil Debt
Activity Add-Back or any part thereof to calculate Consolidated EBITDA for any
period, but instead, shall have the right to elect, in the exercise of its sole
discretion from time to time, the amount, if any, of the Severance Add-Back
and/or the Brazil Debt Activity Add-Back that it will add-back to calculate
Consolidated EBITDA for any period and (z) the aggregate amount of add-backs
made pursuant to this clause (g) shall not exceed $10,000,000 during the term of
this Agreement; minus, (a) to the extent included in the statement of such
Consolidated Net Income for such period, the sum of (i) interest income, (ii)
any extraordinary, unusual or non-recurring income or gains (including, whether
or not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, gains on the sales of assets outside of
the ordinary course of business), (iii) income tax credits (to the extent not
netted from income tax expense) and (iv) any other non-cash income and (b) any
cash payments made during such period in respect of items described in clause
(e) above subsequent to the fiscal quarter in which the relevant non-cash
expenses or losses were reflected as a charge in the statement of Consolidated
Net Income, all as determined on a consolidated basis.

 

 
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“Consolidated Total Debt”: at any date, the aggregate principal amount of all
Indebtedness of the Borrower and its Subsidiaries at such date determined on a
consolidated basis in accordance with GAAP; it being expressly agreed and
acknowledged, for the avoidance of doubt, that for purposes of calculating the
Consolidated Leverage Ratio and the Senior Secured Leverage Ratio, obligations
in respect of letters of credit (including L/C Obligations), to the extent such
letters of credit do not constitute financial letters of credit, shall not be
included in the calculation of Consolidated Total Debt.

 

“L/C Commitment”: $65,000,000.

 

(b)     Amendment to Section 1.1.     Section 1.1 is hereby further amended by
adding the definitions set forth below in the appropriate alphabetical order:

 

“Brazil Debt Activity”: that $14,416,013 intercompany balance as of September
30, 2015, with foreign exchange re-measurements recorded to the income statement
which has been written off as of September 30, 2015.

 

“Brazil Debt Activity Add-Back”: as defined in the definition of Consolidated
EBITDA.

 

“First Amendment”: that certain First Amendment to Third Amended and Restated
Credit Agreement dated as of December 18, 2015 executed by the Borrower, the
Subsidiary Guarantors, the Administrative Agent and the Lenders signatory
thereto.

 

“First Amendment Effective Date”: that certain date on which the conditions of
Section 3 of the First Amendment have been satisfied (or waived in accordance
with Section 10.1).

 

“Severance Add-Back”: as defined in the definition of “Consolidated EBITDA”.

 

(c)     Amendment to Section 2.1(c). Section 2.1(c) is hereby amended by
deleting reference to “$325,000,000” therein and replacing such reference with
“$275,000,000”.

 

(d)     Amendment to Section 5.2. Section 5.2 is hereby amended by adding the
following clause (c) where alphabetically appropriate:

 

(c) Pro Forma Compliance with the Financial Covenants. From the First Amendment
Effective Date until the Springing Maturity Date, (i) after giving effect to any
such extension of credit, on a pro forma basis, the Borrower is in compliance
with Section 7.1 as of the last day of the immediately preceding fiscal quarter
for which financial statements have been delivered pursuant to Section 6.1, and
(ii) the Administrative Agent shall have received an Interim Compliance
Certificate executed by a Responsible Officer in substantially the form of
Exhibit B-2 containing all information and calculations necessary for
determining compliance with the provisions of Section 5.2(c)(i).

 

 
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(e)     Amendment to Section 5.3(a). Section 5.3(a) is hereby amended and
restated in its entirety to read as follows:

 

(a)     The Borrower’s Consolidated Leverage Ratio shall not exceed 2.5 to 1.0
as of the last day of any period of four consecutive fiscal quarters of the
Borrower ending on the last day of the immediately preceding fiscal quarter for
which financial statements are publicly available.

 

(f)     Amendment to Section 7.1(a). Section 7.1(a) is hereby amended and
restated in its entirety to read as follows:

 

(a)     Consolidated Leverage Ratio. Permit the Consolidated Leverage Ratio as
at the last day of any period of four consecutive fiscal quarters of the
Borrower ending with any fiscal quarter set forth below to exceed the ratio set
forth below opposite such fiscal quarter:

 

Fiscal Quarter Ended

 

Consolidated
Leverage Ratio

December 31, 2015

 

5.50 to 1.00

     

March 31, 2016

 

5.50 to 1.00

     

June 30, 2016

 

5.50 to 1.00

     

September 30, 2016

 

5.50 to 1.00

     

December 31, 2016

 

5.50 to 1.00

     

March 31, 2017

 

4.50 to 1.00

     

June 30, 2017 and the last day of each fiscal quarter thereafter

 

4.00 to 1.00

 

 
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(g)     Amendment to Section 7.1(b). Section 7.1(b) is hereby amended and
restated in its entirety to read as follows:

 

(b)     Senior Secured Leverage Ratio. Permit the Senior Secured Leverage Ratio
as at the last day of any period of four consecutive fiscal quarters of the
Borrower ending with any fiscal quarter set forth below to exceed the ratio set
forth below opposite such fiscal quarter:

 

Fiscal Quarter Ended

 

Senior Secured
Leverage Ratio

December 31, 2015

 

2.00 to 1.00

     

March 31, 2016

 

2.00 to 1.00

     

June 30, 2016

 

2.00 to 1.00

     

September 30, 2016

 

2.00 to 1.00

     

December 31, 2016

 

2.00 to 1.00

     

March 31, 2017

 

2.50 to 1.00

     

June 30, 2017 and the last day of each fiscal quarter thereafter

 

3.00 to 1.00

 

 

(h)     Amendment to Schedule 1.1(a). Schedule 1.1(a) to the Credit Agreement is
hereby amended and restated in its entirety and replaced with Schedule 1.1(a)
attached hereto.

 

(i)     Amendment to Schedule 1.1(b). Schedule 1.1(b) to the Credit Agreement is
hereby amended and restated in its entirety and replaced with Schedule 1.1(b)
attached hereto.

 

(j)     Amendment to Exhibit B-2. Exhibit B-2 to the Credit Agreement is hereby
amended and restated in its entirety and replaced with the form attached hereto
as Exhibit B-2.

 

4.     Conditions Precedent. This First Amendment shall become effective on the
date when each of the following conditions is satisfied (or waived in accordance
with Section 10.1):

 

(a)     The Administrative Agent shall have received from Lenders constituting
the Majority Lenders, the Borrower and each of the Subsidiary Guarantors
counterparts (in such number as may be requested by the Administrative Agent) of
this First Amendment signed on behalf of such Person.

 

(b)     The Administrative Agent shall have received satisfactory revised
projections (including a projected balance sheet, income statement and cash flow
statement together with detailed management assumptions) through 2017.

 

(c)     At the time of and immediately after giving effect to this First
Amendment, (i) no Default or Event of Default shall have occurred and be
continuing and (ii) no event or events shall have occurred which individually or
in the aggregate could reasonably be expected to have a Material Adverse Effect.

 

 
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(d)     The Administrative Agent and the Lenders shall have received on or
before the First Amendment Effective Date, (i) all fees required to be paid on
the First Amendment Effective Date pursuant to that certain Amendment Fee Letter
dated December 18, 2015 by and between the Borrower and the Administrative Agent
and (ii) all other amounts due and payable and reimbursement or payment of all
reasonable out-of-pocket costs and expenses required to be reimbursed or paid by
the Borrower under the Credit Agreement, including the reasonable fees and
disbursements of counsel to the Administrative Agent for which invoices have
been presented at least three (3) Business Days prior to the First Amendment
Effective Date.

 

The Administrative Agent is hereby authorized and directed to declare this First
Amendment to be effective when it has received documents confirming or
certifying, to the satisfaction of the Administrative Agent, compliance with the
conditions set forth in this Section 4 or the waiver of such conditions as
permitted in Section 10.1. Such declaration shall be final, conclusive and
binding upon (i) all parties to the Credit Agreement as well as (ii) all parties
to this First Amendment for all purposes.

 

5.     Miscellaneous.

 

(a)     Confirmation. The provisions of the Credit Agreement as amended by this
First Amendment shall remain in full force and effect following the
effectiveness of this First Amendment.

 

(b)     Ratification and Affirmation; Representations and Warranties. The
Borrower and each Subsidiary Guarantor hereby (a) acknowledges the terms of this
First Amendment; (b) ratifies and affirms its obligations under, and
acknowledges its continued liability under, each Loan Document to which it is a
party and agrees that each Loan Document to which it is a party remains in full
force and effect as expressly amended hereby and (c) represents and warrants to
the Lenders that as of the date hereof, after giving effect to the terms of this
First Amendment:

 

(i)     all of the representations and warranties made by it in each Loan
Document to which it is a party are true and correct in all material respects
(except those which have a materiality qualifier, which shall be true and
correct as so qualified), except to the extent any such representations and
warranties are expressly limited to an earlier date, in which case, such
representations and warranties shall continue to be true and correct as of such
specified earlier date,

 

(ii)     no Default or Event of Default has occurred and is continuing, and

 

(iii)     no event or events have occurred which individually or in the
aggregate could reasonably be expected to have a Material Adverse Effect.

 

(c)     Loan Document. This First Amendment is a Loan Document.

 

(d)     Reference to and Effect Upon Credit Agreement and other Loan Documents.
The execution, delivery and effect of this First Amendment shall be limited
precisely as written and shall not be deemed to (i) be a consent to any waiver
of any term or condition, or to any amendment or modification of any term or
condition of the Credit Agreement or any other Loan Document, except as
specifically set forth in this First Amendment, or (ii) prejudice any right,
power or remedy which the Administrative Agent or any Lender now has or may have
in the future under or in connection with the Credit Agreement or any other Loan
Document. Each reference in the Credit Agreement to “this Agreement”,
“hereunder”, “hereof”, “herein” or any other word or words of similar import
shall mean and be a reference to the Credit Agreement as amended hereby, and
each reference in any other Loan Document to the Credit Agreement or any word or
words of similar import shall be and mean a reference to the Credit Agreement as
amended hereby.

 

 
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(e)     Counterparts. This First Amendment may be executed by one or more of the
parties hereto in any number of separate counterparts, and all of such
counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of this First Amendment by facsimile transmission shall be
effective as delivery of a manually executed counterpart hereof.

 

(f)     NO ORAL AGREEMENT. THIS FIRST AMENDMENT, THE CREDIT AGREEMENT AND THE
OTHER LOAN DOCUMENTS EXECUTED IN CONNECTION HEREWITH AND THEREWITH REPRESENT THE
FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR UNWRITTEN ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO SUBSEQUENT ORAL AGREEMENTS AMONG THE PARTIES.

 

(g)     GOVERNING LAW. THIS FIRST AMENDMENT     AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.

 

(h)     Payment of Expenses. In accordance with Section 10.5, the Borrower
agrees to pay or reimburse the Administrative Agent for all of its reasonable
out-of- pocket costs and reasonable costs and expenses incurred in connection
with this First Amendment, any other documents prepared in connection herewith
and the transactions contemplated hereby, including, without limitation, the
reasonable fees and disbursements of counsel to the Administrative Agent.

 

(i)     Severability. Any provision of this First Amendment which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

(j)     Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the Borrower, the Subsidiary Guarantors, the Lenders and the
Administrative Agent and each of their respective successors and assigns.

 

[Signature pages follow.]

 

 
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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to be
duly executed as of the date first written above.

 

BORROWER:        

NEWPARK RESOURCES, INC.

 

 

 

 

 

 

 

By:     /s/ Gregg Piontek                        

 

  Gregg Piontek

  Chief Financial Officer and Vice President

 

 

 

 

SUBSIDIARY GUARANTORS:  

EXCALIBAR MINERALS LLC

NEWPARK DRILLING FLUIDS LLC

NEWPARK MATS & INTEGRATED SERVICES      LLC

NEWPARK DRILLING FLUIDS INTERNATIONAL LLC

 

 

 

 

 

By:     /s/ Gregg Piontek                        

      Gregg Piontek

      Vice President

 

       

Signature Page to First Amendment

 

 

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JPMORGAN CHASE BANK, N.A.,

as Administrative Agent and a Lender

 

 

 

By:     /s/ Greg George                           

Name: Greg George

Title: Authorized Officer

 

 

Signature Page to First Amendment

 

 

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BANK OF AMERICA, N.A.,

as a Lender

 

 

 

By:     /s/ Pace Doherty                          

Name: Pace Doherty

Title: Assistant Vice President

 

 

Signature Page to First Amendment

 

 

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Wells Fargo Bank, N.A.,

as a Lender

 

 

 

By:     /s/ Chris Kim                                

Name: Chris Kim

Title: Vice President

 

 

Signature Page to First Amendment

 

 

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Comerica Bank,

as a Lender

 

 

 

By:     /s/ Bradley Kuhn                        

Name: Bradley Kuhn

Title: Assistant Vice President

 

 

Signature Page to First Amendment

 

 

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BOKF, NA dba Bank of Texas,

as a Lender

 

 

 

By:     /s/ Jeff Dunn                                

Name: Jeff Dunn

Title: Executive Vice President

 

 

Signature Page to First Amendment

 

 

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CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH,

as a Lender

 

 

 

By:     /s/ Nupur Kumar                         

Name: Nupur Kumar

Title: Authorized Signatory

 

By:     /s/ Warren Van Heyst                

Name: Warren Van Heyst

Title: Authorized Signatory

 

 

Signature Page to First Amendment

 

 

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Schedule 1.1(a)

COMMITMENTS

 

Lender

Commitment

Swingline Commitment

JPMorgan Chase Bank, N.A.

$37,500,000.00

$11,250,000.00

Bank of America, N.A.

$37,500,000.00

$0

Wells Fargo Bank, National Association

$22,500,000.00

$0

Comerica Bank

$18,750,000.00

$0

BOKF, NA dba Bank of Texas

$18,750,000.00

$0

Credit Suisse AG, Cayman Islands Branch

$15,000,000.00

$0

Total

$150,000,000.00

$11,250,000.00

 

 

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Schedule 1.1(b)

SPECIFIED L/C COMMITMENTS

 

Lender

L/C Commitment

JPMorgan Chase Bank, N.A.

$50,000,000.00

Bank of America, N.A.

$15,000,000.00

 

 

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EXHIBIT B-2

 

FORM OF
INTERIM COMPLIANCE CERTIFICATE

 

This Interim Compliance Certificate is delivered pursuant to Section
[5.2(c)][5.3(c)] [6.2(b)] of the Third Amended and Restated Credit Agreement,
dated as of March 6, 2015 (as amended, supplemented or otherwise modified from
time to time, the “Credit Agreement”), among Newpark Resources, Inc. (the
“Borrower”), the Lenders party thereto, JPMorgan Chase Bank, N.A., as
administrative agent (the “Administrative Agent”) and the other agents party
thereto. Unless otherwise defined herein, terms defined in the Credit Agreement
and used herein shall have the meanings given to them in the Credit Agreement.

 

1.     I am the duly elected, qualified and acting [Chief Executive Officer/
President/ Chief Financial Officer] of the Borrower.

 

I have reviewed and am familiar with the contents of this Certificate.

 

Attached hereto as Attachment 1 are the computations showing compliance with
[the conditions set forth in [Section 5.2(c)][Section 5.3(a) and (b)]] [the
covenants set forth in Section 7.6] of the Credit Agreement.

 

IN WITNESS WHEREOF, I have executed this Certificate this _____ day of ____,
201_.

 

 

 

 

By: ________________________________
Name:
Title: