Item 1.01 Entry into a Material Definitive Agreement.
Second and Third Amendments to ABL Credit Agreement Temporary Limited Waiver
As previously reported, on September 14, 2016 and September 28, 2016, Basic Energy Services, Inc. (“Basic” or the “Company”) and certain of its subsidiaries entered into a Temporary Limited Waiver and First Amendment thereto (as amended, the “ABL Waiver”) with respect to the Amended and Restated Credit Agreement dated as of November 26, 2014, by and among Basic, as borrower, the lenders party thereto and Bank of America, N.A., as administrative agent, swing line lender and l/c issuer. On October 14, 2016, Basic entered into the Second Amendment to Temporary Limited Waiver (the “Second ABL Waiver Amendment”), which extends the outside date of the temporary limited waiver period under the ABL Waiver from October 16, 2016 to October 17, 2016. On October 17, 2016, Basic entered into the Third Amendment to Temporary Limited Waiver (the “Third ABL Waiver Amendment”), which further extends the outside date of the temporary limited waiver period under the ABL Waiver from October 17, 2016 to October 24, 2016.
Second Amendment to Term Loan Credit Agreement Temporary Limited Waiver and Consent
As previously reported, on August 31, 2016, September 1, 2016, September 13, 2016 and September 28, 2016, Basic and certain of its subsidiaries entered into Temporary Limited Waiver and Consent agreements and a First Amendment thereto (as amended, the “Term Loan Waiver”) with respect to the Term Loan Credit Agreement dated as of February 17, 2016 (the “Term Loan Agreement”), by and among Basic, as borrower, the lenders party thereto and U.S. Bank National Association, as administrative agent. On October 16, 2016, Basic entered into the Second Amendment to Temporary Limited Waiver and Consent (the “Second Term Loan Waiver Amendment”), which extends the temporary limited waiver period under the Term Loan Waiver to the earliest to occur of (i) the occurrence or existence of any event of default under the Term Loan Agreement, other than certain events of default specified in the Term Loan Waiver, (ii) notice from the administrative agent under the Term Loan Agreement or certain required lenders of the occurrence or existence of any Temporary Limited Waiver Default (as defined in the Term Loan Waiver), (iii) the later of October 24, 2016 or such later date as certain required lenders and Basic may agree in their respective sole discretion or (iv) at any time prior to the execution of a restructuring support agreement by and among the parties to the Term Loan Waiver in connection with the commencement of an insolvency proceeding involving Basic and its affiliates, the unrestricted cash balances and cash equivalents of Basic and its consolidated subsidiaries is less than $6,500,000.
Second Amendment to 2019 Notes Forbearance
As previously reported, on September 14, 2016 and September 28, 2016, Basic and certain of its subsidiaries entered into a Forbearance and First Amendment thereto (as amended, the “Forbearance”) with respect to Basic’s 7.75% Senior Notes due 2019 (the “2019 Notes”), by and among Basic, certain guarantors party thereto, and certain beneficial owners and/or investment advisors or managers of discretionary accounts for the holders or beneficial owners (the “Holders”) of the 2019
Notes. On October 16, 2016, Basic entered into the Second Amendment to Forbearance Agreement (the “Second Forbearance Amendment”), which extends the forbearance period under the Forbearance to the earliest to occur of (i) 11:59 p.m. (New York City time) on October 24, 2016, (ii) the occurrence of any event of default under the Indenture dated as of February 15, 2011, among Basic, the guarantors party thereto and Wilmington Trust, N.A., as successor trustee, other than the event of default specified in the Forbearance, (iii) five calendar days following Basic’s receipt of bona fide notice from any Holder of any breach of the conditions or agreements set forth in the Forbearance or (iv) if earlier than October 24, 2016, at such time as either the ABL Waiver or the Term Loan Waiver shall expire or terminate in accordance with their respective terms.
Copies of the Second ABL Waiver Amendment, the Third ABL Waiver Amendment, the Second Term Loan Waiver Amendment and the Second Forbearance Amendment are filed as Exhibits 10.1, 10.2, 10.3 and 10.4, respectively, hereto and are incorporated herein by reference. The above descriptions of the Second ABL Waiver Amendment, the Third ABL Waiver Amendment, the Second Term Loan Waiver Amendment and the Second Forbearance Amendment are qualified in their entirety by the full text of such exhibits.