Item 1.01 Entry into a Material Definitive Agreement.
Paycheck Protection Program Loan
On
July 24, 2020, U.S. Well Services, LLC (the Borrower), a wholly owned subsidiary of U.S. Well Services, Inc. (the Company), entered into a Promissory Note (the Note) with Bank of America,
N.A., as lender, pursuant to the Paycheck Protection Program (the PPP) under the Coronavirus Aid, Relief, and Economic Security Act (as amended by the Paycheck Protection Program Flexibility Act of 2020 and as otherwise
amended from time to time, the CARES Act), in the aggregate principal amount of $10,000,000 (the PPP Loan).
The Note matures on July 24, 2025 and bears interest at a rate of one percent (1%) per annum. Monthly principal and interest payments
will commence following the end of the Deferment Period (as defined in the PPP Loan). The Borrower may prepay the principal of the PPP Loan at any time without a prepayment penalty. Proceeds of the PPP Loan will be used to retain workers and
maintain payroll or make mortgage interest payments, lease payments, and utility payments, as specified under the rules and guidance issued by the U.S. Small Business Administration (SBA) implementing the PPP under Division A,
Title I of the CARES Act. Under the terms of the PPP, up to the entire amount of principal and accrued interest may be forgiven to the extent the PPP Loan proceeds are used as described in the CARES Act and applicable issuing guidance issued by the
SBA under the PPP. The Company intends that the Borrower would use its entire PPP Loan for designated qualifying expenses and to apply for forgiveness in accordance with the terms of the PPP. No assurance can be given that the Borrower will obtain
forgiveness of the PPP Loan in whole or in part.
The Borrower did not provide any collateral or guarantees for the PPP Loan, nor did the
Borrower pay any facility charge to obtain the PPP Loan. The Note provides for customary events of default, including, among others, those relating to bankruptcy, failure to make payments, breaches of representations and material adverse effects.
The lender under the Borrowers ABL Credit Agreement dated May 7, 2019 consented to the Borrowers incurrence of the PPP
Loan.
The foregoing description of the Note does not purport to be complete and is qualified in its entirety by reference to the full
text of the Note, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Third Amendment to Senior Secured Term Loan Credit Agreement
On July 30, 2020, the Borrower, the Company and the subsidiary guarantors party thereto (collectively, the Loan
Parties), entered into a Third Amendment to Senior Secured Term Loan Credit Agreement (the Term Loan Amendment) with CLMG Corp., as administrative agent (the Administrative Agent), CLMG Corp., as
collateral agent (the Collateral Agent, and together with the Administrative Agent, the Agents) and the lenders party thereto (the Lenders). The Term Loan Amendment amends that certain Senior
Secured Term Loan Credit Agreement, dated as of May 7, 2019 (as may be amended, restated, supplemented, or otherwise modified from time to time, the Credit Agreement), among the Loan Parties, the Agents, the Lenders, and
certain other financial institutions party thereto from time to time.
Pursuant to the Term Loan Amendment, the Agents and the Lenders
agreed to make certain modifications and amendments to the Credit Agreement in order to, among other things, consent to the entry into the PPP Loan, subject to the amended terms and conditions specified for the same in the Term Loan Amendment.
Additionally, the Term Loan Amendment made certain modifications to the Credit Agreement which limit the Loan Parties ability to deploy
and use collateral outside of the continental United States and other than in connection with oil and gas fracking and exploration without the prior consent of the Administrative Agent. In the Term Loan Amendment the Loan Parties further agreed to
specific conditions and covenants regarding a turbine rental and services agreement entered into on June 19, 2020 and which affect the equipment which is the subject thereof.