Exhibit 10.1
SEVENTH AMENDMENT TO LOAN AGREEMENT
     THIS SEVENTH AMENDMENT TO LOAN AGREEMENT (this “Amendment”) is made and
entered into as of this 30th day of September, 2008, 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”), WELLS FARGO FOOTHILL, INC., a California corporation formerly known as
Foothill Capital Corporation (“Wells Fargo”), PNC BANK, NATIONAL ASSOCIATION, a
national banking association (“PNC”), 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, that certain Third Amendment to Loan Agreement dated as of
May 1, 2003, that certain Fourth Amendment to Loan Agreement dated as of
March 25, 2004 and effective as of March 31, 2004, and that certain Fifth
Amendment to Loan Agreement dated as of December 31, 2004 and that certain Sixth
Amendment to Loan Agreement entered into as of September 9, 2005 (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 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 31, 2004 (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 $100,000,000;
     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

 

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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 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 and Agreements
     2.01 Amendment and Restatement of Definition of “Final Maturity Date” set
forth in Section 10 of the Loan Agreement. Effective as of the date of execution
of this Amendment, the definition of “Final Maturity Date” set forth in
Section 10 of the Loan Agreement is amended and restated to read in its entirety
as follows:
     “‘Final Maturity Date’ shall mean March 31, 2009.”
     2.02 Fee. In consideration for the agreements set forth herein, Borrower
shall pay to Agent, for the pro rata benefit of the Lenders, a fee of $75,000,
which fee (a) shall be deemed fully earned on the date of execution of this
Amendment, (b) shall be non-refundable and (c) shall be due and payable in full
on the date of execution of this Amendment.

 

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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
     (iii) All other documents Agent may request with respect to any matter
relevant to this Amendment or the transactions contemplated hereby.
     (b) 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.
     (c) 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.
     (d) 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.
     (e) Agent shall have received payment, in immediately available funds, of
the fee described in Section 2.2 hereof.
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.

 

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     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 (except to the extent they
relate to a specific 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.
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

 

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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 Severabilitv. 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.
     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 of the 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,

 

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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.
     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:   /s/ David W. Wehlmann         David W. Wehlmann        Executive Vice
President and
Chief Financial Officer          GUARANTORS:

GREY WOLF, INC.
GREY WOLF HOLDINGS COMPANY
GREY WOLF LLC
DI ENERGY, INC.
GREY WOLF INTERNATIONAL, INC.
DI/PERFENSA INC.
MURCO DRILLING CORPORATION
      By:   /s/ David W. Wehlmann         David W. Wehlmann        Executive
Vice President and
Chief Financial Officer of each of the
foregoing entities   

 

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            LENDERS:

THE CIT GROUP/BUSINESS CREDIT, INC.
as Agent and Lender
      By:   /s/ Robyn Pingree         Name:   Robyn Pingree        Title:   Vice
President      
Revolving Loan Commitment: $40,000,000   

 

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            WELLS FARGO FOOTHILL, INC., formerly known as
Foothill Capital Corporation, as Lender
      By:   /s/ Yelena Kravchuk         Name:   Yelena Kravchuk        Title:  
Vice President      
Revolving Loan Commitment: $35,000,000   

 

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            PNC BANK, NATIONAL ASSOCIATION, as Lender
      By:   /s/ E. Niki Stone         Name:   E. Niki Stone        Title:   Vice
President      
Revolving Loan Commitment: $25,000,000