UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): April 6, 2017
Nuverra Environmental Solutions, Inc.
(Exact Name of Registrant as Specified in Charter)
Delaware | 001-33816 | 26-0287117 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
||
14624 N. Scottsdale Road, Suite #300, Scottsdale, Arizona | 85254 | |||
(Address of Principal Executive Offices) | (Zip Code) |
Registrants telephone number, including area code: (602) 903-7802
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions ( see General Instruction A.2.):
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 1.01. | Entry into a Material Definitive Agreement. |
Restructuring Support Agreement
On April 9, 2017, Nuverra Environmental Solutions, Inc. (the Company) and its subsidiaries (the Company and the subsidiaries, collectively, Nuverra) entered into a Restructuring Support Agreement (the RSA) with holders of over 80% (the Supporting Noteholders) of the Companys outstanding 12.5%/10.0% Senior Secured Second Lien Notes due 2021 (the 2021 Notes). Under the RSA, the Supporting Noteholders have agreed, subject to certain terms and conditions, to support a financial restructuring of Nuverra (the Restructuring) pursuant to a prepackaged plan of reorganization (the Plan) to be filed in a case commenced under chapter 11 of the United States Bankruptcy Code. Nuverra expects to commence a solicitation of votes for the Plan no later than April 20, 2017 and expects to commence the chapter 11 cases on or before April 24, 2017.
The Plan will be based on the restructuring term sheet attached to and incorporated into the RSA (the Term Sheet), which includes:
| debtor in possession financing (the DIP Facilities), consisting of a super-priority, secured, debtor-in-possession revolving credit facility (the DIP Revolving Facility) provided by the lenders under the Companys asset-based revolving credit facility (the ABL Facility) and a super-priority, secured, debtor-in-possession term loan facility (the DIP Term Loan) provided by one or more of the lenders under the Companys term loan (the Term Loan); |
| a rights offering (the Rights Offering) in connection with the consummation of the Restructuring, pursuant to which the Company will distribute freely transferrable rights (the Rights) to permit the holders thereof to acquire, in the aggregate, $150 million of newly issued common stock of the reorganized company at an enterprise valuation of $400 million (the Plan Value); |
| exit financing, to the extent necessary after the Rights Offering, to fund required disbursements under the Plan, through a new first lien, senior secured exit facility in the form of an asset backed revolver, term loan or combination thereof; |
| cash payment in full of all administrative expense claims, priority tax claims, priority claims, DIP Revolving Facility claims, and ABL Facility claims; |
| satisfaction in full of all DIP Term Loan claims and Term Loan claims (collectively, the Term Loan Claims) as follows: (i) conversion of the first $75 million of Term Loan Claims into newly issued common stock of the reorganized company at Plan Value, subject to dilution by a new management incentive plan, the Rights Offering, and the conversion of the remainder of the Term Loan Claims, and (ii) the remaining Term Loan Claims, if any, to be paid in cash from the proceeds of the Rights Offering in excess of $50 million after repayment of the ABL Facility claims and other expenses, with any remaining balance thereafter to be converted to newly issued common stock of the reorganized company at Plan Value (subject to dilution); |
| receipt by the holders of the 2021 Notes, in full satisfaction of their claims, of (a) their pro rata share of 99.75% of the reorganized companys newly issued common stock, subject to dilution by |
a new management incentive plan, the Rights Offering, and the conversion of the Term Loan Claims, and (b) 50% of the Rights (which will be exercisable for up to two years following the completion of the Restructuring); |
| receipt by the holders of the Companys 9.875% Senior Notes due 2018 (the 2018 Notes) in full satisfaction of their claims of (a) their pro rata share of 0.25% of the reorganized companys newly issued common stock, subject to dilution by a new management incentive plan, the Rights Offering, and the conversion of the Term Loan Claims, and (b) a portion of 50% of the Rights to be determined by Nuverra (which will be exercisable prior to the completion of the Restructuring); |
| existing equity interests shall receive no distribution; provided, however that, subject to agreement among the Supporting Noteholders and Nuverra, existing equity holders may receive a portion of the Rights; |
| payment of all undisputed, non-contingent customer, vendor or other trade obligations; and |
| continuation as a public reporting company under the Securities Exchange Act of 1934 and best efforts to have the new common stock listed on the New York Stock Exchange. |
In accordance with the RSA, the Supporting Noteholders agreed, among other things, to: (i) provide interim financing to Nuverra in the aggregate amount of $9,130,000 until the filing of the chapter 11 cases; (ii) support and take all necessary actions in furtherance of the Restructuring; (iii) vote all of its claims against Nuverra in favor of the Plan; (iv) not direct or take any action inconsistent with the Plan or the Supporting Noteholders obligations; (v) not take any action that would, or is intended to in any material respect, interfere with, delay, or postpone the consummation of the Restructuring; and (vi) not transfer claims held by each Supporting Noteholder except with respect to limited and customary exceptions, generally requiring any transferee to become party to the RSA.
In accordance with the RSA, Nuverra agreed, among other things, to: (i) use its best efforts to launch the solicitation of votes to approve the Plan, file the Plan, and seek confirmation of the Plan; (ii) use its best efforts to obtain orders from the bankruptcy court regarding the Restructuring; (iii) act in good faith and use its best efforts to support and complete the transactions contemplated in the Term Sheet; (iv) use its best efforts to obtain all required regulatory approvals and third-party approvals of the Restructuring; (v) not take any actions inconsistent with the RSA, Term Sheet, DIP Facilities, and the Plan; (vi) operate its business in the ordinary course consistent with past practice and preserve its businesses and assets; and (vii) support and take all actions that are necessary and appropriate to facilitate the confirmation of the Plan and the consummation of the Restructuring.
The RSA may be terminated upon the occurrence of certain events, including the failure to meet specified milestones related to the solicitation of votes to approve the Plan, commencement of the chapter 11 cases, confirmation of the Plan, consummation of the Plan, and the entry of orders relating to the DIP Facilities.
The information in this Form 8-K is not intended to be, and should not in any way be construed as, a solicitation of votes on the Plan, nor should the information contained herein or in the RSA be relied on for any purpose with respect to the Plan. The foregoing description of the RSA, including the Term Sheet, is only a summary and does not purport to be a complete description of the terms and conditions under the RSA and the Term Sheet, and such description is qualified in its entirety by reference to the full text of the RSA (to which the Term Sheet is attached), a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 1.01.
Term Loan Credit Agreement Amendments
Sixth Amendment to Term Loan
On April 6, 2017 (the Sixth Amendment Effective Date), the Company entered into a Sixth Amendment (Increase Amendment) to Term Loan Credit Agreement (the Sixth Term Loan Agreement Amendment) by and among the lenders named therein (the Term Loan Lenders), Wilmington Savings Fund Society, FSB (Wilmington), as administrative agent, Wells Fargo, as collateral agent, the Company, and the guarantors named therein, which further amends the Term Loan Credit Agreement, dated April 15, 2016, by and among Wilmington, the Term Loan Lenders, and the Company (the Term Loan Agreement) by increasing the Term Loan Lenders commitment, and the principal amount borrowed by the Company, under the Term Loan Agreement from $59,200,000 to $60,300,000 (the Sixth Amendment Additional Term Commitment).
Pursuant to the Sixth Term Loan Agreement Amendment, the Company is required to use a portion of the net cash proceeds of the Sixth Amendment Additional Term Commitment of $1 million to pay the fees, costs and expenses incurred in connection with the Sixth Term Loan Agreement Amendment. The remaining net cash proceeds, subject to satisfaction of certain release conditions, will be available for general operating, working capital and other general corporate purposes. The Company intends to use the additional liquidity provided by the Sixth Amendment Additional Term Commitment to fund its business operations until the filing of the Plan.
As a condition to the effectiveness of the Sixth Term Loan Agreement Amendment, the Company was required to enter into a letter agreement with the agent under the ABL Facility providing, among other things, that the agent under the ABL Facility would not exercise any remedies with respect to the Sixth Amendment Additional Term Commitment deposited in the Companys Master Account, subject to the terms of such letter agreement.
The Sixth Term Loan Agreement Amendment requires the Company, among other things, to (i) on or before April 7, 2017, enter into the RSA and other documentation requested by the Lenders in connection with the Restructuring; and (ii) within 5 days of the Sixth Amendment Effective Date, cause mortgage title policies to be issued for all real property collateral under the Companys Term Loan Agreement and to pay all premiums for such title policies.
Pursuant to the Sixth Term Loan Agreement Amendment, the Term Loan Lenders consented to the sale of the property situated in the Southeast Quarter of the Northwest Quarter of Section 3, Township 1 North, Range 5 East, Sixth Judicial District of Amite County, Mississippi.
Seventh Amendment to Term Loan
On April 10, 2017 (the Seventh Amendment Effective Date), the Company entered into a Seventh Amendment (Increase Amendment) to Term Loan Credit Agreement (the Seventh Term Loan Agreement Amendment) by and among the Term Loan Lenders, Wilmington, as administrative agent, Wells Fargo, as collateral agent, the Company, and the guarantors named therein, which further amends the Term Loan Agreement by increasing the Term Loan Lenders commitment, and the principal amount borrowed by the Company, under the Term Loan Agreement from $60,300,000 to $65,800,000 (the Seventh Amendment Additional Term Commitment). The Seventh Amendment Additional Term Commitment is in partial satisfaction of the requirement to fund Supplemental Term Loans (as defined the Fifth Amendment to Term Loan Credit Agreement).
Pursuant to the Seventh Term Loan Agreement Amendment, the Company is required to use a portion of the net cash proceeds of the Seventh Amendment Additional Term Commitment of $5 million to pay the fees, costs and expenses incurred in connection with the Seventh Term Loan Agreement Amendment. The remaining net cash proceeds, subject to satisfaction of certain release conditions, will be available for general operating, working capital and other general corporate purposes. The Company intends to use the additional liquidity provided by the Seventh Amendment Additional Term Commitment to fund its business operations until the filing of the Plan.
As a condition to the effectiveness of the Seventh Term Loan Agreement Amendment, the Company was required to enter into a letter agreement with the agent under the ABL Facility providing, among other things, that the agent under the ABL Facility would not exercise any remedies with respect to the Seventh Amendment Additional Term Commitment deposited in the Companys Master Account, subject to the terms of such letter agreement.
The Seventh Term Loan Agreement Amendment requires the Company, among other things, to (i) comply with the terms and conditions of the RSA; and (ii) within 5 days of the Seventh Amendment Effective Date, cause mortgage title policies to be issued for all real property collateral under the Companys Term Loan Agreement and to pay all premiums for such title policies.
The foregoing descriptions of the Sixth Term Loan Agreement Amendment and Seventh Term Loan Agreement Amendment are only summaries and do not purport to be a complete description of the terms and conditions under the Sixth Term Loan Agreement Amendment and Seventh Term Loan Agreement Amendment, and such descriptions are qualified in their entirety by reference to the full text of the Sixth Term Loan Agreement Amendment and Seventh Term Loan Agreement Amendment, copies of which are filed as Exhibits 10.2, and 10.3, respectively, to this Current Report on Form 8-K and are incorporated by reference into this Item 1.01.
Letter Agreements Regarding Additional Term Loans
Sixth Amendment Letter Agreement
On April 6, 2017, in connection with the Sixth Term Loan Agreement Amendment, the Company and Wells Fargo entered into a letter agreement regarding the Sixth Amendment Additional Term Commitment (the Sixth Amendment Letter Agreement). Pursuant to the Sixth Amendment Letter Agreement, Wells Fargo agreed to not exercise any remedies with respect to the cash proceeds received from the Sixth Amendment Additional Term Commitment that are deposited in the Companys Master Account, subject to the terms of such Sixth Amendment Letter Agreement. In addition, the Sixth Amendment Letter Agreement provides that in the event Wells Fargo or the lenders under the ABL Facility foreclose or otherwise obtain direct control over the Sixth Amendment Additional Term Commitment, such Sixth Amendment Additional Term Commitment shall be deemed to be held in trust by Wells Fargo or the lenders under the ABL Facility for the benefit of the Term Loan Lenders.
Seventh Amendment Letter Agreement
On April 10, 2017, in connection with the Seventh Term Loan Agreement Amendment, the Company and Wells Fargo entered into a letter agreement regarding the Seventh Amendment Additional Term Commitment (the Seventh Amendment Letter Agreement). Pursuant to the Seventh Amendment Letter Agreement, Wells Fargo agreed to not exercise any remedies with respect to the cash proceeds received from the Seventh Amendment Additional Term Commitment that are deposited in the Companys Master Account, subject to the terms of such Seventh Amendment Letter Agreement. In addition, the Seventh Amendment Letter Agreement provides that in the event Wells Fargo or the lenders under the ABL Facility foreclose or otherwise obtain direct control over the Seventh Amendment Additional Term Commitment, such Seventh Amendment Additional Term Commitment shall be deemed to be held in trust by Wells Fargo or the lenders under the ABL Facility for the benefit of the Term Loan Lenders.
The foregoing descriptions of the Sixth Amendment Letter Agreement and Seventh Amendment Letter Agreement are only summaries and do not purport to be a complete description of the terms and conditions under the Sixth Amendment Letter Agreement and Seventh Amendment Letter Agreement, and such descriptions are qualified in their entirety by reference to the full text of the Sixth Amendment Letter Agreement and Seventh Amendment Letter Agreement, copies of which are filed as Exhibits 10.4 and 10.5, respectively, to this Current Report on Form 8-K and are incorporated by reference into this Item 1.01.
Intercreditor Agreement Amendments
Fourth Intercreditor Agreement Amendments
On April 6, 2017, in connection with the Sixth Term Loan Agreement Amendment, the Company acknowledged and agreed to the terms and conditions under Amendment No. 4 to Intercreditor Agreement (the Fourth Pari Passu Intercreditor Agreement Amendment), dated April 6, 2017 by and among Wells Fargo, as pari passu collateral agent, Wells Fargo, as revolving credit agreement agent under the ABL Facility, and Wilmington, as administrative agent under the Term Loan Agreement, which further amends the Intercreditor Agreement, dated as of April 15, 2016, between Wells Fargo, as pari passu collateral agent, Wells Fargo, as administrative agent under the ABL Facility, and Wilmington, as administrative agent under the Term Loan Agreement (the Pari Passu Intercreditor Agreement). On April 6, 2017, in connection with the Sixth Term Loan Agreement Amendment, the Company acknowledged and agreed to the terms and conditions under Amendment No. 4 to Intercreditor Agreement (the Second Lien Intercreditor Agreement Fourth Amendment), dated April 6, 2017, by and among Wells Fargo, as revolving credit agreement agent under the ABL Facility, Wilmington, as administrative agent under the Term Loan Agreement, and Wilmington, as second lien agent under the Second Lien Intercreditor Agreement, which further amends the Intercreditor Agreement, dated as of April 15, 2016, between Wells Fargo, as administrative agent under the ABL Facility, Wilmington, as administrative agent under the Term Loan Agreement, and Wilmington, as collateral agent under the indenture governing the 2021 Notes (the Second Lien Intercreditor Agreement). The Fourth Pari Passu Intercreditor Agreement Amendment and the Second Lien Intercreditor Agreement Fourth Amendment permit the Sixth Amendment Additional Term Commitment by amending the Term Loan Cap to increase it from $65,120,000 to $66,330,000. The Term Loan Cap is higher than the commitment under the Term Loan, as it includes, in addition to the Lenders commitment under the Term Loan Agreement, origination fees paid in kind and a 10% cushion.
Fifth Intercreditor Agreement Amendments
On April 10, 2017, in connection with the Seventh Term Loan Agreement Amendment, the Company acknowledged and agreed to the terms and conditions under Amendment No. 5 to Intercreditor Agreement (the Fifth Pari Passu Intercreditor Agreement Amendment), dated April 7, 2017 by and among Wells Fargo, as pari passu collateral agent, Wells Fargo, as revolving credit agreement agent under the ABL Facility, and Wilmington, as administrative agent under the Term Loan Agreement, which further amends the Pari Passu Intercreditor Agreement. On April 10, 2017, in connection with the Seventh Term Loan Agreement Amendment, the Company acknowledged and agreed to the terms and conditions under Amendment No. 5 to Intercreditor Agreement (the Second Lien Intercreditor Agreement Fifth Amendment), dated April 7, 2017, by and among Wells Fargo, as revolving credit agreement agent under the ABL Facility, Wilmington, as administrative agent under the Term Loan Agreement, and Wilmington, as second lien agent under the Second Lien Intercreditor Agreement, which further amends the Second Lien Intercreditor Agreement. The Fifth Pari Passu Intercreditor Agreement Amendment and the Second Lien Intercreditor Agreement Fifth Amendment permit the Seventh Amendment Additional Term Commitment by amending the Term Loan Cap to increase it from to $66,330,000 to $72,380,000. The Term Loan Cap is higher than the commitment under the Term Loan, as it includes, in addition to the Lenders commitment under the Term Loan Agreement, origination fees paid in kind and a 10% cushion.
The foregoing descriptions of the Fourth Pari Passu Intercreditor Agreement Amendment, Second Lien Intercreditor Agreement Fourth Amendment, Fifth Pari Passu Intercreditor Agreement Amendment, and Second Lien Intercreditor Agreement Fifth Amendment are only a summaries and do not purport to be a complete description of the terms and conditions under the Fourth Pari Passu Intercreditor Agreement Amendment, Second Lien Intercreditor Agreement Fourth Amendment, Fifth Pari Passu Intercreditor Agreement Amendment, and Second Lien Intercreditor Agreement Fifth Amendment, and such descriptions are qualified in their entirety by reference to the full text of the Fourth Pari Passu Intercreditor Agreement Amendment, Second Lien Intercreditor Agreement Fourth Amendment, Fifth Pari Passu Intercreditor Agreement Amendment, and Second Lien Intercreditor Agreement Fifth Amendment, copies of which are filed as Exhibits 4.1, 4.2, 4.3, and 4.4, respectively, to this Current Report on Form 8-K and are incorporated by reference into this Item 1.01.
Item 2.03. | Creation of a Direct Financial Obligation or an Obligation Under an off-Balance Sheet Arrangement of a Registrant. |
The information set forth in Item 1.01 is incorporated by reference into this Item 2.03.
Item 7.01. | Regulation FD. |
On April 12, 2017, the Company issued a press release announcing the signing of the RSA, a copy of which is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information contained in the press release is being furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or otherwise subject to the liability of such section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01. | Financial Statements and Exhibits. |
(d)
Exhibit Number |
Description |
|
4.1 | Amendment No. 4 to Intercreditor Agreement, dated April 6, 2017, by and among Wells Fargo, as pari passu collateral agent, Wells Fargo, as revolving credit agreement agent under the ABL Facility, and Wilmington, as administrative agent under the Term Loan Agreement | |
4.2 | Amendment No. 4 to Intercreditor Agreement, dated April 6, 2017, by and among Wells Fargo, as revolving credit agreement agent under the ABL Facility, Wilmington, as administrative agent under the Term Loan Agreement, and Wilmington, as second lien agent under the Second Lien Intercreditor Agreement | |
4.3 | Amendment No. 5 to Intercreditor Agreement, dated April 10, 2017, by and among Wells Fargo, as pari passu collateral agent, Wells Fargo, as revolving credit agreement agent under the ABL Facility, and Wilmington, as administrative agent under the Term Loan Agreement | |
4.4 | Amendment No. 5 to Intercreditor Agreement, dated April 10, 2017, by and among Wells Fargo, as revolving credit agreement agent under the ABL Facility, Wilmington, as administrative agent under the Term Loan Agreement, and Wilmington, as second lien agent under the Second Lien Intercreditor Agreement | |
10.1 | Restructuring Support Agreement, dated as of April 9, 2017, by and among the Company and its subsidiaries, and the Supporting Noteholders | |
10.2 | Sixth Amendment (Increase Amendment) to Term Loan Credit Agreement, dated April 6, 2017, by and among the Term Loan Lenders, Wilmington, Wells Fargo, the Company and the guarantors named therein |
10.3 |
Seventh Amendment (Increase Amendment) to Term Loan Credit Agreement, dated April 10, 2017, by and among the Term Loan Lenders, Wilmington, Wells Fargo, the Company and the guarantors named therein | |
10.4 |
Letter Agreement, dated April 6, 2017, between the Company and Wells Fargo | |
10.5 |
Letter Agreement, dated April 10, 2017, between the Company and Wells Fargo | |
99.1 |
Press Release, dated April 12, 2017 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. | ||||||||
Date: April 12, 2017 | By: |
/s/ Joseph M. Crabb |
||||||
Name: | Joseph M. Crabb | |||||||
Title: | Executive Vice President and Chief Legal Officer |
EXHIBIT INDEX
Exhibit Number |
Description |
|
4.1 | Amendment No. 4 to Intercreditor Agreement, dated April 6, 2017, by and among Wells Fargo, as pari passu collateral agent, Wells Fargo, as revolving credit agreement agent under the ABL Facility, and Wilmington, as administrative agent under the Term Loan Agreement | |
4.2 | Amendment No. 4 to Intercreditor Agreement, dated April 6, 2017, by and among Wells Fargo, as revolving credit agreement agent under the ABL Facility, Wilmington, as administrative agent under the Term Loan Agreement, and Wilmington, as second lien agent under the Second Lien Intercreditor Agreement | |
4.3 | Amendment No. 5 to Intercreditor Agreement, dated April 10, 2017, by and among Wells Fargo, as pari passu collateral agent, Wells Fargo, as revolving credit agreement agent under the ABL Facility, and Wilmington, as administrative agent under the Term Loan Agreement | |
4.4 | Amendment No. 5 to Intercreditor Agreement, dated April 10, 2017, by and among Wells Fargo, as revolving credit agreement agent under the ABL Facility, Wilmington, as administrative agent under the Term Loan Agreement, and Wilmington, as second lien agent under the Second Lien Intercreditor Agreement | |
10.1 | Restructuring Support Agreement, dated as of April 9, 2017, by and among the Company and its subsidiaries, and the Supporting Noteholders | |
10.2 | Sixth Amendment (Increase Amendment) to Term Loan Credit Agreement, dated April 6, 2017, by and among the Term Loan Lenders, Wilmington, Wells Fargo, the Company and the guarantors named therein | |
10.3 | Seventh Amendment (Increase Amendment) to Term Loan Credit Agreement, dated April 10, 2017, by and among the Term Loan Lenders, Wilmington, Wells Fargo, the Company and the guarantors named therein | |
10.4 | Letter Agreement, dated April 6, 2017, between the Company and Wells Fargo | |
10.5 | Letter Agreement, dated April 10, 2017, between the Company and Wells Fargo | |
99.1 | Press Release, dated April 12, 2017 |
Exhibit 4.1
AMENDMENT NO. 4 TO INTERCREDITOR AGREEMENT
THIS AMENDMENT NO. 4 TO INTERCREDITOR AGREEMENT ( Amendment ) is entered into as of April 6, 2017, by and among WELLS FARGO BANK, NATIONAL ASSOCIATION, as Pari Passu Collateral Agent for the Pari Passu Secured Parties, WELLS FARGO BANK, NATIONAL ASSOCIATION , as Revolving Credit Agreement Agent for the Revolving Credit Agreement Secured Parties, and WILMINGTON SAVINGS FUND SOCIETY, FSB , as Term Loan Agent for the Term Loan Secured Parties.
WHEREAS, Pari Passu Collateral Agent, Revolving Credit Agreement Agent, and Term Loan Agent are parties to that certain Intercreditor Agreement, dated as of April 15, 2016 (as amended, supplemented or otherwise modified, the Intercreditor Agreement );
WHEREAS, on the date hereof, certain Term Loan Lenders intend to provide the Company with additional term loans under the Term Loan Agreement subject to the terms of the Intercreditor Agreement; and
WHEREAS, Pari Passu Collateral Agent, Revolving Credit Agreement Agent, and Term Loan Agent desire to amend the Intercreditor Agreement to amend certain of the provisions of the Intercreditor Agreement pursuant to the terms and conditions herein.
NOW THEREFORE, in consideration of the premises and mutual agreements herein contained, the parties hereto agree as follows:
1. Defined Terms . Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to such terms in the Intercreditor Agreement.
2. Amendments to Intercreditor Agreement . Subject to the conditions to effectiveness set forth in Section 3 below, the Intercreditor Agreement is hereby amended as follows:
(a) Section 1.1 of the Intercreditor Agreement is hereby amended by amending section (i) of the definition of Term Loan Cap by deleting $65,120,000 and inserting $66,330,000 in lieu thereof.
3. Conditions to Effectiveness . The amendments set forth in Section 2 shall become effective upon the satisfaction of each of the following conditions precedent:
(a) The parties hereto shall have each executed this Amendment and
(b) all conditions precedent to the effectiveness set forth in Section 4 (other than the condition to deliver this Amendment) of that certain Sixth Amendment to Term Loan Credit Agreement, dated as of the date hereof, by and among Company, Term Loan Agent and Term Loan Lenders shall have been met.
4. Continuing Effect . Except as expressly set forth herein, nothing in this Amendment shall constitute a modification or alteration of the terms, conditions or covenants of the Intercreditor Agreement, or a waiver of any other terms or provisions thereof, and the
Intercreditor Agreement shall remain unchanged and shall continue in full force and effect, in each case as amended hereby.
5. Miscellaneous .
(a) Governing Law . This Amendment shall be a contract made under and governed by the internal laws of the State of New York applicable to contracts made and to be performed entirely within such State, without regard to conflict of law principles.
(b) Counterparts . This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Amendment.
[Signature Page Follows]
-2-
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized and delivered as of the date first above written.
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Pari Passu Collateral Agent |
||
By: | /s/ Zachary S. Buchanan | |
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory | |
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Revolving Credit Agreement Agent |
||
By: | /s/ Zachary S. Buchanan | |
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory |
WILMINGTON SAVINGS FUND SOCIETY, FSB, as Term Loan Agent |
||
By: | /s/ Geoffrey J. Lewis | |
Name: | Geoffrey J. Lewis | |
Title: | Vice President |
ACKNOWLEDGMENT
Borrower and each of Borrowers undersigned Subsidiaries each hereby acknowledge that they have received a copy of the foregoing Amendment No. 4 to Intercreditor Agreement and agree to recognize all rights granted by the Amendment No. 4 to Intercreditor Agreement and the Intercreditor Agreement to Pari Passu Collateral Agent, each Authorized Representative, the Pari Passu Secured Parties, waive the provisions of Section 9-615(a) of the UCC in connection with the application of proceeds of Collateral in accordance with the provisions of the Amendment No. 4 to Intercreditor Agreement and Intercreditor Agreement, agree that they will not do any act or perform any obligation which is not in accordance with the agreements set forth in the Amendment No. 4 to Intercreditor Agreement and Intercreditor Agreement. Borrower and each of Borrowers undersigned Subsidiaries each further acknowledge and agree that they are not an intended beneficiary or third party beneficiary under the Amendment No. 4 to Intercreditor Agreement or the Intercreditor Agreement, as amended, restated, supplemented, or otherwise modified hereafter.
NUVERRA ENVIRONMENTAL SOLUTIONS, INC., as Borrower | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Executive Vice President | |
HECKMANN WATER RESOURCES CORPORATION | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HECKMANN WATER RESOURCES (CVR), INC. | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President |
1960 WELL SERVICES, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HEK WATER SOLUTIONS, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
APPALACHIAN WATER SERVICES, LLC By: HEK Water Solutions, LLC, its managing member |
||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS POWER FUELS, LLC , a Delaware limited liability company | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS POWER FUELS, LLC , a North Dakota limited liability company | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President |
LANDTECH ENTERPRISES, L.L.C. | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS LEASING, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
IDEAL OILFIELD DISPOSAL, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
NUVERRA TOTAL SOLUTIONS, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
NES WATER SOLUTIONS, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HECKMANN WOODS CROSS, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President |
Exhibit 4.2
AMENDMENT NO. 4 TO INTERCREDITOR AGREEMENT
THIS AMENDMENT NO. 4 TO INTERCREDITOR AGREEMENT ( Amendment ) is entered into as of April 6, 2017, by and among WELLS FARGO BANK, NATIONAL ASSOCIATION, as Revolving Credit Agreement Agent, WILMINGTON SAVINGS FUND SOCIETY, FSB , as Term Loan Agent, and WILMINGTON SAVINGS FUND SOCIETY, FSB , as Second Lien Agent.
WHEREAS, Revolving Credit Agreement Agent, Term Loan Agent, and Second Lien Agent are parties to that certain Intercreditor Agreement, dated as of April 15, 2016 (as amended, supplemented or otherwise modified, the Intercreditor Agreement );
WHEREAS, on the date hereof, certain Term Lenders intend to provide the Company with additional term loans under the Term Loan Agreement subject to the terms of the Intercreditor Agreement; and
WHEREAS, Revolving Credit Agreement Agent, Term Loan Agent, and Second Lien Agent desire to amend the Intercreditor Agreement to amend certain of the provisions of the Intercreditor Agreement pursuant to the terms and conditions herein.
NOW THEREFORE, in consideration of the premises and mutual agreements herein contained, the parties hereto agree as follows:
1. Defined Terms . Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to such terms in the Intercreditor Agreement.
2. Amendments to Intercreditor Agreement . Subject to the conditions to effectiveness set forth in Section 3 below, the Intercreditor Agreement is hereby amended as follows
(a) Section 1.1 of the Intercreditor Agreement is hereby amended by amending section (i) of the definition of Term Loan Cap by deleting $65,120,000 and inserting $66,330,000 in lieu thereof.
3. Conditions to Effectiveness . The amendments set forth in Section 2 shall become effective upon the satisfaction of each of the following conditions precedent:
(a) The parties hereto shall have each executed this Amendment and
(b) all conditions precedent to the effectiveness set forth in Section 4 (other than the condition to deliver this Amendment) of that certain Sixth Amendment to Term Loan Credit Agreement, dated as of the date hereof, by and among Company, Term Loan Agent and Term Loan Lenders shall have been met.
4. Continuing Effect . Except as expressly set forth herein, nothing in this Amendment shall constitute a modification or alteration of the terms, conditions or covenants of the Intercreditor Agreement, or a waiver of any other terms or provisions thereof, and the Intercreditor Agreement shall remain unchanged and shall continue in full force and effect, in each case as amended hereby.
5. Miscellaneous .
(a) Governing Law . This Amendment shall be a contract made under and governed by the internal laws of the State of New York applicable to contracts made and to be performed entirely within such State, without regard to conflict of law principles.
(b) Counterparts . This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Amendment.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized and delivered as of the date first above written.
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Pari Passu Collateral Agent |
||
By: | /s/ Zachary S. Buchanan | |
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory | |
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Revolving Credit Agreement Agent |
||
By: | /s/ Zachary S. Buchanan | |
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory |
WILMINGTON SAVINGS FUND SOCIETY, FSB, as Term Loan Agent |
||
By: | /s/ Geoffrey J. Lewis | |
Name: | Geoffrey J. Lewis | |
Title: | Vice President | |
WILMINGTON SAVINGS FUND SOCIETY, FSB, as Second Lien Agent |
||
By: | /s/ Geoffrey J. Lewis | |
Name: | Geoffrey J. Lewis | |
Title: | Vice President |
ACKNOWLEDGMENT
Borrower and each of Borrowers undersigned Subsidiaries each hereby acknowledge that they have received a copy of the foregoing Amendment No. 4 to Intercreditor Agreement and agree to recognize all rights granted by the Amendment No. 4 to Intercreditor Agreement and the Intercreditor Agreement to First Lien Agent, the other First Lien Claimholders, Second Lien Agent, and the other Second Lien Claimholders, waive the provisions of Section 9-615(a) of the UCC in connection with the application of proceeds of Collateral in accordance with the provisions of the Amendment No. 4 to Intercreditor Agreement and Intercreditor Agreement, agree that they will not do any act or perform any obligation which is not in accordance with the agreements set forth in the Amendment No. 4 to Intercreditor Agreement and Intercreditor Agreement. Borrower and each of Borrowers undersigned Subsidiaries each further acknowledge and agree that they are not an intended beneficiary or third party beneficiary under the Amendment No. 4 to Intercreditor Agreement or the Intercreditor Agreement, as amended, restated, supplemented, or otherwise modified hereafter.
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. , as Borrower | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Executive Vice President | |
HECKMANN WATER RESOURCES CORPORATION | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HECKMANN WATER RESOURCES (CVR), INC. | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President |
1960 WELL SERVICES, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HEK WATER SOLUTIONS, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
APPALACHIAN WATER SERVICES, LLC By: HEK Water Solutions, LLC, its managing member |
||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS POWER FUELS, LLC , a Delaware limited liability company | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS POWER FUELS, LLC , a North Dakota limited liability company | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President |
LANDTECH ENTERPRISES, L.L.C. | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS LEASING, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
IDEAL OILFIELD DISPOSAL, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
NUVERRA TOTAL SOLUTIONS, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
NES WATER SOLUTIONS, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HECKMANN WOODS CROSS, LLC | ||
By: | /s/ Joseph M. Crabb | |
Name: | Joseph M. Crabb | |
Title: | Vice President |
Exhibit 4.3
AMENDMENT NO. 5 TO INTERCREDITOR AGREEMENT
THIS AMENDMENT NO. 5 TO INTERCREDITOR AGREEMENT ( Amendment ) is entered into as of April 10, 2017, by and among WELLS FARGO BANK, NATIONAL ASSOCIATION, as Pari Passu Collateral Agent for the Pari Passu Secured Parties, WELLS FARGO BANK, NATIONAL ASSOCIATION , as Revolving Credit Agreement Agent for the Revolving Credit Agreement Secured Parties, and WILMINGTON SAVINGS FUND SOCIETY, FSB , as Term Loan Agent for the Term Loan Secured Parties.
WHEREAS, Pari Passu Collateral Agent, Revolving Credit Agreement Agent, and Term Loan Agent are parties to that certain Intercreditor Agreement, dated as of April 15, 2016 (as amended, supplemented or otherwise modified, the Intercreditor Agreement );
WHEREAS, on the date hereof, certain Term Loan Lenders intend to provide the Company with additional term loans under the Term Loan Agreement subject to the terms of the Intercreditor Agreement; and
WHEREAS, Pari Passu Collateral Agent, Revolving Credit Agreement Agent, and Term Loan Agent desire to amend the Intercreditor Agreement to amend certain of the provisions of the Intercreditor Agreement pursuant to the terms and conditions herein.
NOW THEREFORE, in consideration of the premises and mutual agreements herein contained, the parties hereto agree as follows:
1. Defined Terms . Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to such terms in the Intercreditor Agreement.
2. Amendments to Intercreditor Agreement . Subject to the conditions to effectiveness set forth in Section 3 below, the Intercreditor Agreement is hereby amended as follows:
(a) Section 1.1 of the Intercreditor Agreement is hereby amended by amending section (i) of the definition of Term Loan Cap by deleting $66,330,000 and inserting $72,380,000 in lieu thereof.
3. Conditions to Effectiveness . The amendments set forth in Section 2 shall become effective upon the satisfaction of each of the following conditions precedent:
(a) The parties hereto shall have each executed this Amendment and
(b) all conditions precedent to the effectiveness set forth in Section 4 (other than the condition to deliver this Amendment) of that certain Seventh Amendment to Term Loan Credit Agreement, dated as of the date hereof, by and among Company, Term Loan Agent and Term Loan Lenders shall have been met.
4. Continuing Effect . Except as expressly set forth herein, nothing in this Amendment shall constitute a modification or alteration of the terms, conditions or covenants of the Intercreditor Agreement, or a waiver of any other terms or provisions thereof, and the
Intercreditor Agreement shall remain unchanged and shall continue in full force and effect, in each case as amended hereby.
5. Miscellaneous .
(a) Governing Law . This Amendment shall be a contract made under and governed by the internal laws of the State of New York applicable to contracts made and to be performed entirely within such State, without regard to conflict of law principles.
(b) Counterparts . This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Amendment.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized and delivered as of the date first above written.
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Pari Passu Collateral Agent |
||
By: |
/s/ Zachary S. Buchanan |
|
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory | |
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Revolving Credit Agreement Agent |
||
By: |
/s/ Zachary S. Buchanan |
|
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory |
WILMINGTON SAVINGS FUND SOCIETY, FSB , as Term Loan Agent |
||
By: |
/s/ Geoffrey J. Lewis |
|
Name: | Geoffrey J. Lewis | |
Title: | Vice President |
ACKNOWLEDGMENT
Borrower and each of Borrowers undersigned Subsidiaries each hereby acknowledge that they have received a copy of the foregoing Amendment No. 5 to Intercreditor Agreement and agree to recognize all rights granted by the Amendment No. 5 to Intercreditor Agreement and the Intercreditor Agreement to Pari Passu Collateral Agent, each Authorized Representative, the Pari Passu Secured Parties, waive the provisions of Section 9-615(a) of the UCC in connection with the application of proceeds of Collateral in accordance with the provisions of the Amendment No. 5 to Intercreditor Agreement and Intercreditor Agreement, agree that they will not do any act or perform any obligation which is not in accordance with the agreements set forth in the Amendment No. 5 to Intercreditor Agreement and Intercreditor Agreement. Borrower and each of Borrowers undersigned Subsidiaries each further acknowledge and agree that they are not an intended beneficiary or third party beneficiary under the Amendment No. 5 to Intercreditor Agreement or the Intercreditor Agreement, as amended, restated, supplemented, or otherwise modified hereafter.
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. , as Borrower |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Executive Vice President | |
HECKMANN WATER RESOURCES CORPORATION |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HECKMANN WATER RESOURCES (CVR), INC. |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President |
1960 WELL SERVICES, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HEK WATER SOLUTIONS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
APPALACHIAN WATER SERVICES, LLC | ||
By: | HEK Water Solutions, LLC, its managing member | |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS POWER FUELS, LLC , a Delaware limited liability company | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS POWER FUELS, LLC , a North Dakota limited liability company | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President |
LANDTECH ENTERPRISES, L.L.C. | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS LEASING, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
IDEAL OILFIELD DISPOSAL, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
NUVERRA TOTAL SOLUTIONS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
NES WATER SOLUTIONS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HECKMANN WOODS CROSS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President |
Exhibit 4.4
AMENDMENT NO. 5 TO INTERCREDITOR AGREEMENT
THIS AMENDMENT NO. 5 TO INTERCREDITOR AGREEMENT ( Amendment ) is entered into as of April 10, 2017, by and among WELLS FARGO BANK, NATIONAL ASSOCIATION, as Revolving Credit Agreement Agent, WILMINGTON SAVINGS FUND SOCIETY, FSB , as Term Loan Agent, and WILMINGTON SAVINGS FUND SOCIETY, FSB , as Second Lien Agent.
WHEREAS, Revolving Credit Agreement Agent, Term Loan Agent, and Second Lien Agent are parties to that certain Intercreditor Agreement, dated as of April 15, 2016 (as amended, supplemented or otherwise modified, the Intercreditor Agreement );
WHEREAS, on the date hereof, certain Term Lenders intend to provide the Company with additional term loans under the Term Loan Agreement subject to the terms of the Intercreditor Agreement; and
WHEREAS, Revolving Credit Agreement Agent, Term Loan Agent, and Second Lien Agent desire to amend the Intercreditor Agreement to amend certain of the provisions of the Intercreditor Agreement pursuant to the terms and conditions herein.
NOW THEREFORE, in consideration of the premises and mutual agreements herein contained, the parties hereto agree as follows:
1. Defined Terms . Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to such terms in the Intercreditor Agreement.
2. Amendments to Intercreditor Agreement . Subject to the conditions to effectiveness set forth in Section 3 below, the Intercreditor Agreement is hereby amended as follows
(a) Section 1.1 of the Intercreditor Agreement is hereby amended by amending section (i) of the definition of Term Loan Cap by deleting $66,330,000 and inserting $72,380,000 in lieu thereof.
3. Conditions to Effectiveness . The amendments set forth in Section 2 shall become effective upon the satisfaction of each of the following conditions precedent:
(a) The parties hereto shall have each executed this Amendment and
(b) all conditions precedent to the effectiveness set forth in Section 4 (other than the condition to deliver this Amendment) of that certain Seventh Amendment to Term Loan Credit Agreement, dated as of the date hereof, by and among Company, Term Loan Agent and Term Loan Lenders shall have been met.
4. Continuing Effect . Except as expressly set forth herein, nothing in this Amendment shall constitute a modification or alteration of the terms, conditions or covenants of the Intercreditor Agreement, or a waiver of any other terms or provisions thereof, and the Intercreditor Agreement shall remain unchanged and shall continue in full force and effect, in each case as amended hereby.
5. Miscellaneous .
(a) Governing Law . This Amendment shall be a contract made under and governed by the internal laws of the State of New York applicable to contracts made and to be performed entirely within such State, without regard to conflict of law principles.
(b) Counterparts . This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Amendment.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized and delivered as of the date first above written.
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Pari Passu Collateral Agent |
||
By: |
/s/ Zachary S. Buchanan |
|
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory | |
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Revolving Credit Agreement Agent |
||
By: |
/s/ Zachary S. Buchanan |
|
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory |
WILMINGTON SAVINGS FUND SOCIETY, FSB, as Term Loan Agent |
||
By: |
/s/ Geoffrey J. Lewis |
|
Name: | Geoffrey J. Lewis | |
Title: | Vice President | |
WILMINGTON SAVINGS FUND SOCIETY, FSB, as Second Lien Agent |
||
By: |
/s/ Geoffrey J. Lewis |
|
Name: | Geoffrey J. Lewis | |
Title: | Vice President |
ACKNOWLEDGMENT
Borrower and each of Borrowers undersigned Subsidiaries each hereby acknowledge that they have received a copy of the foregoing Amendment No. 5 to Intercreditor Agreement and agree to recognize all rights granted by the Amendment No. 5 to Intercreditor Agreement and the Intercreditor Agreement to First Lien Agent, the other First Lien Claimholders, Second Lien Agent, and the other Second Lien Claimholders, waive the provisions of Section 9-615(a) of the UCC in connection with the application of proceeds of Collateral in accordance with the provisions of the Amendment No. 5 to Intercreditor Agreement and Intercreditor Agreement, agree that they will not do any act or perform any obligation which is not in accordance with the agreements set forth in the Amendment No. 5 to Intercreditor Agreement and Intercreditor Agreement. Borrower and each of Borrowers undersigned Subsidiaries each further acknowledge and agree that they are not an intended beneficiary or third party beneficiary under the Amendment No. 5 to Intercreditor Agreement or the Intercreditor Agreement, as amended, restated, supplemented, or otherwise modified hereafter.
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. , as Borrower |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Executive Vice President | |
HECKMANN WATER RESOURCES CORPORATION |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HECKMANN WATER RESOURCES (CVR), INC. |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President |
1960 WELL SERVICES, LLC |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HEK WATER SOLUTIONS, LLC |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
APPALACHIAN WATER SERVICES, LLC | ||
By: | HEK Water Solutions, LLC, its managing member |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS POWER FUELS, LLC , a Delaware limited liability company |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS POWER FUELS, LLC , a North Dakota limited liability company |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President |
LANDTECH ENTERPRISES, L.L.C. | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
BADLANDS LEASING, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
IDEAL OILFIELD DISPOSAL, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
NUVERRA TOTAL SOLUTIONS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
NES WATER SOLUTIONS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President | |
HECKMANN WOODS CROSS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President |
Exhibit 10.1
Execution Version
RESTRUCTURING SUPPORT AGREEMENT
This RESTRUCTURING SUPPORT AGREEMENT (together with all exhibits, schedules, and attachments hereto, as amended, supplemented, or otherwise modified from time to time in accordance with the terms hereof, this Agreement ), dated as of April 9, 2017, is entered into by and among (a) Nuverra Environmental Solutions, Inc. ( Nuverra ) and Heckmann Water Resources Corporation, Heckmann Water Resources (CVR) Inc., 1960 Well Services, LLC, HEK Water Solutions, LLC, Appalachian Water Services, LLC, Badlands Power Fuels, LLC (a Delaware limited liability company), Badlands Power Fuels, LLC (a North Dakota limited liability company), Landtech Enterprises, L.L.C., Badlands Leasing, LLC, Ideal Oilfield Disposal, LLC, Nuverra Total Solutions, LLC, NES Water Solutions, LLC, and Heckmann Woods Cross, LLC (such entities, together with Nuverra, the ( Company or, the Nuverra Parties ); and (b) the undersigned holders of the 2021 Notes (as defined below) (together with their respective successors and permitted assigns under this Agreement, each a Supporting Noteholder and, collectively, the Supporting Noteholders ). The Company and the Supporting Noteholders are referred to herein as the Parties and each individually as a Party . Capitalized terms used herein and not defined herein shall have the meanings ascribed to such terms in the Restructuring Term Sheet (as defined below) annexed hereto as Exhibit A (including all exhibits thereto).
PRELIMINARY STATEMENTS
WHEREAS , the Parties have negotiated in good faith at arms length and have agreed to undertake a financial restructuring of the Company, to be implemented by each of the Nuverra Parties commencing a voluntary case (collectively, the Chapter 11 Cases ) under chapter 11 of title 11 of the United States Code (the Bankruptcy Code ) in the United States Bankruptcy Court for the District of Delaware (the Bankruptcy Court ) to pursue a pre-packaged chapter 11 plan of reorganization all in accordance with the terms set forth in this Agreement and the Definitive Documents (as defined below) (the Restructuring Transaction ).
WHEREAS , as of the date hereof, the Supporting Noteholders collectively hold 82.66% of the outstanding aggregate principal amount of bonds (including all outstanding capitalized interest paid-in-kind) under that certain Indenture for Second-Lien Notes Due 2021 (the 2021 Notes ), dated as of April 15, 2016 (as amended, restated, amended and restated, extended, supplemented, or otherwise modified from time to time, the 2021 Indenture ) by and among Nuverra, as issuer, each of the guarantors party thereto, and Wilmington Savings Fund Society, FSB, as trustee (the 2021 Note Indenture Trustee );
WHEREAS, each Party desires that the Restructuring Transaction be implemented through a joint chapter 11 prepackaged plan of reorganization for the Company on the terms and conditions substantially as set forth in the term sheet attached hereto as Exhibit A (as amended, supplemented, or otherwise modified from time to time consistent with the terms of this Agreement, the ( Restructuring Term Sheet );
WHEREAS, in connection with the Chapter 11 Cases, the Company intends to file a pre-packaged chapter 11 plan of reorganization substantially consistent with the terms of the Restructuring Term Sheet and in form and substance acceptable to the Supporting Noteholders (as may be amended, supplemented, or otherwise modified from time to time consistent with the terms of this Agreement, the Nuverra Plan ) and a related disclosure statement in form and substance acceptable to the Supporting Noteholders (as may be amended, supplemented, or otherwise modified from time to time consistent with the terms of this Agreement, the Disclosure Statement ); and
WHEREAS , the Parties desire to express to one another their mutual support and commitment in respect of the matters discussed herein.
NOW , THEREFORE , in consideration of the promises and the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
Section 1. Certain Definitions; Rules of Construction . As used in this Agreement, the following terms have the following meanings:
(a) 2021 Indenture has the meaning set forth in the Preliminary Statements.
(b) 2021 Notes has the meaning set forth in the Preliminary Statements.
(c) 2021 Note Indenture Trustee has the meaning set forth in the Preliminary Statements.
(d) Affiliate means, with respect to any Person, any other Person which directly or indirectly controls, or is under common control with, or is controlled by, such Person. As used in this definition, control (including, with its correlative meanings, controlled by and under common control with) shall mean, with respect to any Person, the possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise) of such Person. For the avoidance of doubt, none of the Supporting Noteholders are, or following the Restructuring Transactions will be, Affiliates of the Company.
(e) Agreement has the meaning set forth in the Preamble.
(f) Applicable Law means any federal state, local or foreign law, statute, code, ordinance, rule, or regulation, including those addressing unfair and deceptive acts and practices, advertising, usury, and permits.
(g) AWS Promissory Note means the approximately $5 million promissory note pertaining to the acquisition of the remaining interest in Debtor Appalachian Water Services, LLC.
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(h) Bankruptcy Code has the meaning set forth in the Preliminary Statements.
(i) Bankruptcy Court has the meaning set forth in the Preliminary Statements.
(j) Board has the meaning set forth in Section 6(b)(iii).
(k) Business Day means any day that is not a Saturday, Sunday, or other day on which banks in New York are authorized or required to close.
(l) Chapter 11 Cases has the meaning set forth in the Preliminary Statements.
(m) Claim has the meaning set forth in section 101(5) of the Bankruptcy Code.
(n) Company has the meaning set forth in the Preamble.
(o) Company Termination Event has the meaning set forth in Section 6(b) .
(p) Company Termination Notice has the meaning set forth in Section 6(b) .
(q) Confirmation Order has the meaning set forth in Section 5 .
(r) Definitive Documents has the meaning set forth in Section 7 .
(s) DIP Financing Order has the meaning set forth in Section 3(d) .
(t) Disclosure Statement has the meaning set forth in the Preliminary Statements.
(u) Equity Interest means any and all equity securities (as defined in section 101(16) of the Bankruptcy Code) of the Company, including all shares, common stock, preferred stock, or other instrument evidencing any fixed or contingent ownership interest in the Company, including any option, warrant, or other right, contractual or otherwise, to acquire any such interest in the Company, whether or not transferable and whether fully vested or vesting in the future, that existed immediately before the Effective Date.
(v) Ideal Oilfield APA means that certain Purchase and Sale Agreement by and Among Badlands Power Fuels, LLC, Ideal Oilfield Disposal, LLC, TDL Resources, LLC, 9 Zs LLC and Chax Holdings, LLC dated as of May 19, 2013.
(w) Interim Financing has the meaning set forth in Section 4(a) .
(x) Joinder Agreement has the meaning set forth in Section 4(d) .
3
(y) Material Adverse Change has the meaning set forth in Section 6(a)(xxiii) .
(z) Nuverra has the meaning set forth in the Preamble.
(aa) Nuverra Plan has the meaning set forth in the Preliminary Statements.
(bb) Nuverra Parties has the meaning set forth in the Preamble.
(cc) Party has the meaning set forth in the Preamble.
(dd) Person means an individual, a partnership, a joint venture, a limited liability company, a corporation, a trust, an unincorporated organization, a group, a governmental or regulatory authority, or any legal entity or association.
(ee) Petition Date has the meaning set forth in Section 3(a) .
(ff) Plan Supplement means the compilation of agreements, documents and forms of agreements, documents, schedules, and exhibits to the Nuverra Plan that will be filed by the Company with the Bankruptcy Court.
(gg) Restructuring Term Sheet has the meaning set forth in the Preliminary Statements.
(hh) Restructuring Transaction has the meaning set forth in the Preliminary Statements.
(ii) SEC means the Securities and Exchange Commission.
(jj) Solicitation has the meaning set forth in Section 3(a) .
(kk) Solicitation Materials has the meaning set forth in Section 5(a)(x) .
(ll) Subsidiary means, as to any Person, any other Person of which a majority of the outstanding voting securities or other voting Equity Interests are owned, directly or indirectly, by such Person.
(mm) Support Effective Date has the meaning set forth in Section 11 .
(nn) Support Period means, with reference to any Party, the period commencing on the Support Effective Date and ending on the earlier of (i) the Effective Date; and (ii) the date on which this Agreement is terminated with respect to such Party in accordance with Section 6 hereof.
(oo) Supporting Noteholders has the meaning set forth in the Preamble.
(pp) Supporting Noteholder Termination Event has the meaning set forth in Section 6(a) .
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(qq) Supporting Noteholder Termination Notice has the meaning set forth in Section 6(a) .
(rr) Tax or Taxes means (a) all federal, local or foreign taxes, charges, fees, imposts, levies or other assessments, including all income, gross receipts, escheat, capital, sales, use, ad valorem, value added, transfer, franchise, profits, inventory, capital stock, license, withholding, payroll, employment, social security, unemployment, excise, severance, stamp, occupation, property and estimated taxes, customs duties, fees, assessments and charges of any kind whatsoever imposed by a governmental authority; and (b) all interest, penalties, fines, additions to tax or additional amounts imposed by any Tax Authority in connection with any item described in clause (a).
(ss) Tax Authority means the Internal Revenue Service and any state, local, or foreign government, agency or instrumentality, charged with the administration of any applicable law relating to Taxes.
(tt) Transfer has the meaning set forth in Section 4(d) .
(uu) Transferee has the meaning set forth in Section 4(d) .
(vv) Vehicle Financing Obligations means obligations under agreements for the leasing, purchase or other financing of vehicles used in the Companys business.
Unless otherwise specified, references in this Agreement to any Section or clause refer to such Section or clause as contained in this Agreement. The words herein , hereof , and hereunder and other words of similar import in this Agreement refer to this Agreement as a whole, and not to any particular Section or clause contained in this Agreement. Wherever from the context it appears appropriate, each term stated in either the singular or plural shall include the singular and the plural, and pronouns stated in the masculine, feminine, or neuter gender shall include the masculine, feminine, and neuter genders. The words including , includes , and include shall each be deemed to be followed by the words without limitation .
Section 2. Restructuring Term Sheet.
The terms and conditions of the Restructuring Transaction are set forth in the Restructuring Term Sheet. In the event of any inconsistencies between the terms of this Agreement and the Restructuring Term Sheet, the terms of the Restructuring Term Sheet shall govern.
Section 3. Bankruptcy Process.
(a) Commencement of Solicitation and the Chapter 11 Cases . Each Nuverra Party hereby agrees that such Nuverra Party shall (i) as soon as reasonably practicable, but in no event later than 11:59 p.m. prevailing Eastern Time on April 20, 2017, launch the solicitation of votes to accept or reject the Nuverra Plan required for confirmation of the Nuverra Plan (the Solicitation ) and, (ii) with the consent of the
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Supporting Noteholders, file with the Bankruptcy Court a voluntary petition for relief under chapter 11 of the Bankruptcy Code and any and all other documents necessary to commence the chapter 11 case of such Nuverra Party (the date on which such filing occurs, the Petition Date ).
(b) Filing of the Nuverra Plan . On the Petition Date, the Company shall file the Nuverra Plan together with the Disclosure Statement and motion regarding confirmation.
(c) Confirmation of the Nuverra Plan . The Company shall use its best efforts to obtain confirmation of the Nuverra Plan as soon as practicable following the Petition Date in accordance with the Bankruptcy Code and on terms consistent with this Agreement, and each Supporting Noteholder shall use its best efforts to cooperate fully in connection therewith.
(d) DIP Financing Order . The Company shall on or within two (2) Business Day after the Petition Date file a motion with the Bankruptcy Court seeking interim and final approval of the DIP Facilities, which DIP Facilities shall be in form and substance acceptable to the DIP Lenders, and shall use its best efforts to obtain approval and entry, on an interim and final basis, of the DIP Facilities (such interim or final order, as applicable, the DIP Financing Order ), which shall be in form and substance acceptable to the Supporting Noteholders.
Section 4. Agreements of the Supporting Noteholders .
(a) Provision of Interim Financing. Each Supporting Noteholder agrees to provide, from the date hereof through the Petition Date, interim financing pursuant to the terms annexed hereto as Exhibit B (the Interim Financing ).
(b) Direction of Trustees and Administrative Agents . Each Supporting Noteholder agrees that, for the duration of the Support Period, such Supporting Noteholder in its capacity as a holder of 2021 Notes, 2018 Notes, loans under the ABL Facility, loans under the Term Loan or Equity Interests, as applicable, shall take all necessary actions in furtherance of the Restructuring Transactions, including the provision of any required consent, authorization, or direction to the 2021 Note Indenture Trustee, the indenture trustee to the 2018 Notes, the administrative agent for the ABL Facility or the administrative agent for the Term Loan, as applicable, to take any necessary actions in furtherance of the Restructuring Transactions, including, without limitation, the taking of any action necessary as, or available to, a holder of 2021 Notes to rescind an acceleration of the 2021 Indenture; provided , that, the Supporting Noteholders shall only be required to provide a reasonable and customary indemnity in connection with any such direction.
(c) Voting; Support of Restructuring Transaction . Each Supporting Noteholder agrees that, for the duration of the Support Period, such Supporting Noteholder shall:
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(i) perform its commitments and other obligations under this Agreement;
(ii) subject to the receipt by such Supporting Noteholder of the Disclosure Statement and the Solicitation Materials in respect of the Nuverra Plan, vote all of its Claims against the Company now or hereafter owned by such Supporting Noteholder (or for which such Supporting Noteholder now or hereafter has voting control over) in favor of the Nuverra Plan by timely delivering its duly executed and completed ballot accepting the Nuverra Plan following receipt of the Solicitation Materials;
(iii) not (A) direct the 2021 Note Indenture Trustee, the indenture trustee to the 2018 Notes, the administrative agent for the ABL Facility or the administrative agent for the Term Loan, as applicable, to (1) take any action inconsistent with such Supporting Noteholders obligations under this Agreement or (2) declare an event of default or accelerate the 2021 Notes, 2018 Notes, ABL Facility or Term Loan; (B) exercise any right or remedy for the enforcement, collection, or recovery of any Claim against the Company except in a manner consistent with this Agreement, the Restructuring Term Sheet, the DIP Financing Order or the Nuverra Plan, as applicable, or (C) amend, change or withdraw (or cause to be amended, changed or withdrawn) its vote to accept the Nuverra Plan; and
(iv) not (A) object to, delay, impede, or take any other action to interfere with, delay, or postpone acceptance, confirmation, or implementation of the Nuverra Plan and the Restructuring Transaction; (B) directly or indirectly solicit, encourage, propose, file, support, participate in the formulation of or vote for any restructuring, sale of assets (including pursuant to section 363 of the Bankruptcy Code), merger, workout or plan of reorganization or liquidation (under Chapter 11 or Chapter 7 of the Bankruptcy Code) for any of the Nuverra Parties other than the Nuverra Plan or (C) otherwise take any action that would, or is intended to, in any material respect interfere with, delay or postpone the consummation of the Restructuring Transaction.
(d) Transfers . Each Supporting Noteholder agrees that, for the duration of the Support Period, such Supporting Noteholder shall not sell, transfer, loan, issue, pledge, hypothecate, assign, grant, encumber, or otherwise dispose of (including by participation), directly or indirectly, in whole or in part, including to an Affiliate, any Claims now or hereafter beneficially owned by such Supporting Noteholder or for which it now or hereafter serves as the nominee, investment manager, or advisor for beneficial holders, as applicable, or any option thereon or any right or interest therein (including granting any proxies, depositing any such Claims into a voting trust, or entering into a voting agreement with respect to any such Claims) (collectively, a Transfer ), unless the transferee of such Claims (the Transferee ) either (A) in the case of Transfers consisting of pledges or hypothecations, is a lender, a trustee, or an agent under such Supporting Noteholders credit arrangements and such pledge or hypothecation does not
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include voting rights and will not otherwise interfere with such Supporting Noteholders performance of its obligations hereunder; (B) is a Supporting Noteholder; or (C) if such Transferee is not a Supporting Noteholder, prior to the effectiveness of such Transfer, such Transferee agrees in writing, for the benefit of the Parties, to become a Supporting Noteholder and to be bound by all of the terms of this Agreement applicable to a Supporting Noteholder (including with respect to any and all Claims the Transferee already may then or subsequently own or control) by executing a joinder agreement, substantially in the form attached hereto as Exhibit C (each, a Joinder Agreement ), and by delivering an executed copy thereof to the Company (in accordance with the notice provisions set forth in Section 21 hereof and prior to the effectiveness of such Transfer), in which event (x) the Transferee shall be deemed to be a Supporting Noteholder hereunder with respect to all of its owned or controlled Claims and (y) from and after the delivery of such executed copy of such Joinder Agreement to the Company (in accordance with the notice provisions set forth in Section 21 hereof and prior to the effectiveness of such Transfer), the transferor Supporting Noteholder shall be deemed to relinquish its rights, and be released from its obligations, under this Agreement to the extent of the transferred Claims; provided , that in no event shall any such Transfer relieve a Party hereto from liability for its breach or non-performance of its obligations hereunder prior to the date of delivery of such Joinder Agreement; and provided , further , that each Supporting Noteholder agrees that, if it has transferred some or all of the Claims and such Transferee is not authorized to vote any and all such Claims under Applicable Law, such Transferor shall vote such Claims on behalf of such Transferee in a manner consistent with this Agreement and the obligations under Section 4(a) hereof. Each Supporting Noteholder agrees that any Transfer of any Claims that does not comply with the terms and procedures set forth herein shall be deemed void ab initio , and the Company and each other Supporting Noteholder shall have the right to enforce the voiding of such Transfer and the terms hereof.
(e) The agreements of the Supporting Noteholders in this Section 4 shall be solely on such Supporting Noteholders own behalf and not on behalf of any other Supporting Noteholders and shall be several and not joint.
Section 5. Agreements of the Company .
(a) Affirmative Covenants . The Company, jointly and severally, agrees that, for the duration of the Support Period, the Company shall:
(i) perform its commitments and other obligations under this Agreement and in connection with the commencement of the Chapter 11 Case, use its best efforts to (A) launch the Solicitation prior to the date of the filing of the Companys chapter 11 petitions; provided , however , that if the Supporting Noteholders determine that the Company should pursue a pre-negotiated Nuverra Plan rather than a prepackaged Nuverra Plan, such Solicitation shall be performed by the Company during the Chapter 11 Case after approval of the Disclosure Statement by the Bankruptcy Court, (B) file the Chapter 11 Plan on the Petition
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Date and (C) seek approval of the Disclosure Statement and confirmation of the Nuverra Plan by the Bankruptcy Court expeditiously;
(ii) use best efforts to (A) obtain orders of the Bankruptcy Court in respect of the Restructuring Transaction, including obtaining entry of the DIP Financing Order and an order confirming the Nuverra Plan ( Confirmation Order ) as expeditiously as practicable; (B) timely file a formal written response in opposition to any objection filed with the Bankruptcy Court by any Person with respect to entry of the DIP Financing Order (or with respect to any adequate protection proposed to be granted or granted to the DIP Lenders pursuant to the DIP Financing Order or the Confirmation Order), the or the Confirmation Order; (C) prosecute and defend any appeals related to the DIP Financing Order, the or the Confirmation Order; (D) support and consummate the Restructuring Transaction in accordance with this Agreement, including the good faith negotiation, preparation and filing within the time frame provided herein or in the Definitive Documents; and (E) execute and deliver any other required agreements to effectuate and consummate the Restructuring Transaction;
(iii) provide reasonably prompt written notice (in accordance with Section 22 hereof) to the Supporting Noteholders during the Support Period of (A) the occurrence, or failure to occur, of any event of which the Company has actual knowledge which occurrence or failure would be likely to cause (1) any covenant of any Nuverra Party contained in this Agreement not to be satisfied in any material respect, or (2) any condition precedent contained in the Nuverra Plan not to timely occur or become impossible to satisfy, (B) receipt of any notice from any third party alleging that the consent of such party is or may be required in connection with the transactions contemplated by the Restructuring Transaction, (C) receipt of any notice from any governmental unit with jurisdiction in connection with this Agreement or contemplated by the Restructuring Transaction regarding matters that may delay or impede confirmation or consummation of the Nuverra Plan, or that could give rise to a Material Adverse Change, (D) receipt of any notice of any proceeding commenced, or, to the actual knowledge of the Company, threatened against the Company, relating to or involving or otherwise affecting in any material respect transactions contemplated by the Restructuring Transaction, and (E) any failure of the Company to comply, in any material respect, with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder;
(iv) act in good faith and use best efforts to support and complete successfully the Solicitation in accordance with the terms of this Agreement and the transactions contemplated by the Restructuring Term Sheet and this Agreement;
(v) use best efforts to meet the milestones set forth in clauses Section 6(a)(ii)-Section 6(a)(vi) of Section 6(a) of this Agreement;
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(vi) timely file a formal objection to any motion filed with the Bankruptcy Court by any individual, a partnership, a joint venture, a limited liability company, a corporation, a trust, an unincorporated organization, a group, a governmental or regulatory authority, or any legal entity or association seeking the entry of an order (A) modifying or terminating the Companys exclusive right to file and/or solicit acceptances of a plan of reorganization, (B) directing the appointment of an examiner with expanded powers or a trustee, (C) converting the Chapter 11 Cases to cases under chapter 7 of the Bankruptcy Code, (D) dismissing the Chapter 11 Cases or (E) for relief that (x) is inconsistent with this Agreement in any material respect or (y) would, or would reasonably be expected to, frustrate the purposes of this Agreement, including by preventing the consummation of the Restructuring Transaction;
(vii) use best efforts to obtain any and all required regulatory approvals and third-party approvals of the Restructuring Transaction;
(viii) not take any actions inconsistent with, or that are intended or are reasonably likely to interfere with, this Agreement, the Restructuring Term Sheet, the DIP Facilities, the Nuverra Plan and any other related documents executed by the Company;
(ix) not directly or indirectly seek or solicit any discussions relating to, or enter into any agreements relating to, any alternative proposal (including any alternative transaction involving the reorganization, sale, merger, consolidation or liquidation of the Company) other than the Restructuring Transaction, nor shall any Nuverra Party solicit or direct any Person to undertake any of the foregoing;
(x) provide draft copies of all material motions or applications (including all first day and second day motions and orders) and other related documents, the Nuverra Plan, the Disclosure Statement, ballots and other solicitation materials in respect of the Nuverra Plan (collectively, the Solicitation Materials ), any proposed amended version of the Nuverra Plan or the Disclosure Statement, and a proposed Confirmation Order and any other document any Nuverra Party intends to file with the Bankruptcy Court to the Supporting Noteholders respective legal advisors, at least three (3) Business Days prior to the date when the Company intends to file any such pleading or other document (provided that if delivery of such motions, orders or materials (other than the Nuverra Plan, the Disclosure Statement, the Solicitation Materials, the Confirmation Order or the DIP Financing Order) at least three (3) Business Days in advance is not reasonably practicable, such motion, order or material shall be delivered as soon as reasonably practicable prior to filing, but in no event later than one (1) Business Day in advance of any filing thereof) and shall consult in good faith with such legal advisors regarding the form and substance of any such proposed filing with the Bankruptcy Court;
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(xi) operate its business in the ordinary course consistent with past practice and preserve its businesses and assets;
(xii) support and take all actions that are necessary and appropriate to facilitate approval of the DIP Facilities, approval of the Disclosure Statement, confirmation of the Nuverra Plan and consummation of the Restructuring Transaction in accordance with, and within the time frames contemplated by, this Agreement (including within the deadlines set forth in Section 6 ); and
(xiii) use commercially reasonable efforts to ensure that no current or former employee, officer or director of the Company takes any action, directly or indirectly, to: (A) harm or damage the Company and its businesses in any material way; (B) compete with the Company and its businesses in any way or solicit for employment any employees of the Company; (C) challenge, hinder, delay or object to this Agreement, the Restructuring Term Sheet, the Nuverra Plan and any and all Definitive Documents related in any way to the Restructuring Transaction and the Debtors chapter 11 process; (D) align with, aid or assist in any way any third party with respect to any alternative transaction or with respect to (A)-(C) above; and (E) purchase any asset or assets of the Company, any business or businesses of the Company or the entirety of the Company.
(b) Negative Covenants of the Company . The Company shall not, without the prior written consent of the Supporting Noteholders, take any of the following actions:
(i) modify, amend, supplement or file any pleading seeking authority to modify, amend or supplement the Definitive Documents or any other document related to the DIP Facilities, the Nuverra Plan or the Restructuring Transaction in a manner that is inconsistent with this Agreement or the Restructuring Term Sheet;
(ii) authorize, approve, ratify or otherwise implement any change to the senior management team, including the hiring, termination, change in position or change in compensation of any member of the Company senior management team;
(iii) hire or otherwise engage any professional advisor or consultant or modify, amend, supplement or waive any provision of the engagement agreements of any current professional advisor or consultant;
(iv) make, declare or set aside any payment in respect of the termination of any employee or severance costs or expenses relating thereto, or modify any employment agreement or compromise any Claim of any employee of the Company, including in connection with the Chapter 11 Cases;
(v) modify, amend, supplement or waive any provision of the employment agreement of Mark D. Johnsrud, or grant any release to Mark D. Johnsrud, including in connection with the Chapter 11 Cases
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(vi) modify, amend, supplement or waive any provision of its organizational documents, including its charter and by-laws;
(vii) modify, amend or supplement any insurance plan or indemnity agreements or provisions covering or relating to directors and officers of the Company;
(viii) issue, deliver, redeem or sell or enter into any contract to issue, deliver, redeem or sell any of its Equity interests;
(ix) make, declare, set aside or pay any dividend or other distributions in respect of any of its Equity Interests;
(x) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization;
(xi) amend, modify, supplement or terminate any employee benefit, welfare or pension plan or enter into any contract that would constitute an employee benefit, welfare or pension plan;
(xii) make any Tax election, enter into any contract with respect to Taxes, extend the statute of limitations in respect of any Taxes, settle any Tax claim or assessment, take any Tax position inconsistent with prior Tax elections, agreements or positions, file any amended Tax return or any Tax return inconsistent with past practice or take any other action with respect to Taxes that is outside the ordinary course of business (other than such elections, contracts, positions or actions with respect to Taxes that are immaterial in nature); or
(xiii) approve, authorize or agree (orally or in writing) to take any of the actions identified above.
(c) Listing Obligation . The Company shall use best efforts to have the New Common Stock listed on the New York Stock Exchange.
(d) Registration Rights Agreement . On the Effective Date, the Company shall enter into a Registration Rights Agreement in form and substance acceptable to the Supporting Noteholders with respect to any and all securities to be issued to the Supporting Noteholders under the Nuverra Plan.
(e) Tax Matters . The Company agrees that the Tax structure of the Restructuring Transaction, including the utilization or preservation of any Tax attributes or benefits (by election or otherwise) and the treatment of the Restructuring Transaction to the Parties shall be determined by the Supporting Noteholders acting reasonably and in good faith, in consultation with the Company.
(f) Professional Fees . The Company agrees to pay all the reasonable and documented fees and expenses, subject to the terms of any applicable engagement letter
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or reimbursement letter, as the case may be, of Fried, Frank, Harris, Shriver & Jacobson LLP as legal advisor to the Supporting Noteholders; provided , that the Company shall pay any accrued but unpaid amounts owing under such engagement and/or fee letters upon the termination of this Agreement.
(g) Automatic Stay . The Company acknowledges and agrees and shall not dispute that after the Petition Date, the termination of this Agreement and the giving of notice of termination by any Party pursuant to this Agreement shall not be a violation of the automatic stay of section 362 of the Bankruptcy Code (and each Nuverra Party hereby waives, to the fullest extent permitted by Applicable Law, the applicability of the automatic stay to the giving of such notice).
Section 6. Termination of Agreement .
(a) Supporting Noteholder Termination Events . Upon written notice ( Supporting Noteholder Termination Notice ) from a Supporting Noteholder delivered in accordance with Section 22 hereof, such Supporting Noteholder may terminate this Agreement, solely with respect to such terminating Supporting Noteholder, at any time after the occurrence, and during the continuation, of any of the following events (each, a Supporting Noteholder Termination Event ):
(i) the breach in any material respect by the Company of any of their respective covenants, obligations, representations, or warranties contained in this Agreement or in any of the Definitive Documents, and, to the extent such breach is curable, such breach remains uncured for a period of five (5) Business Days from the earlier of (x) knowledge of such breach by the Company; and (y) the date the Company receives a Supporting Noteholder Termination Notice.
(ii) At 11:59 p.m. prevailing Eastern Time on April 20, 2017 unless the Company, either directly, or through their designated voting agent, have commenced the Solicitation.
(iii) At 11:59 p.m. prevailing Eastern Time on April 23, 2017 unless the Company commenced the Chapter 11 Cases and filed the Nuverra Plan and the Disclosure Statement.
(iv) At 11:59 p.m. prevailing Eastern Time on the date that is 60 Business Days after the Petition Date, if the Bankruptcy Court has not entered the Confirmation Order in form and substance satisfactory to the Supporting Noteholders.
(v) At 11:59 p.m. prevailing Eastern Time on the date that is 75 Business Days after the Petition Date, if the Effective Date has not occurred.
(vi) At 11:59 p.m. prevailing Eastern Time on the date (x) that is five (5) Business Days after the Petition Date if the Bankruptcy Court has not entered the DIP Financing Order on an interim basis and (y) that is thirty (30) calendar
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days after the Petition Date if the Bankruptcy Court has not entered the DIP Financing Order on a final basis.
(vii) The Company withdraws the Nuverra Plan or Disclosure Statement, or the Company files any motion or pleading with the Bankruptcy Court (including the Confirmation Order) that is not consistent with this Agreement, the Restructuring Term Sheet or the Nuverra Plan and such motion or pleading has not been withdrawn prior to the earlier of (i) two (2) Business Days after the Company receives written notice from a Supporting Noteholder (in accordance with Section 22 ) that such motion or pleading is inconsistent with this Agreement, the Restructuring Term Sheet or the Nuverra Plan and (ii) entry of an order of the Bankruptcy Court approving such motion or pleading.
(viii) Any Nuverra Party files any motion for the (A) conversion of one or more of the Chapter 11 Cases to a case under chapter 7 of the Bankruptcy Code, (B) appointment of examiner with expanded powers beyond those set forth in section 1106(a)(3) and (4) of the Bankruptcy Code or a trustee or receiver in one or more of the Chapter 11 Cases or (C) dismissal of one or more of the Chapter 11 Cases.
(ix) An examiner with expanded powers or a trustee shall have been appointed in the Chapter 11 Cases or if the Chapter 11 Cases shall have been converted to cases under chapter 7 of the Bankruptcy Code or have been dismissed by order of the Bankruptcy Court.
(x) Any Nuverra Partys exclusive right to file a Chapter 11 plan pursuant to section 1121 of the Bankruptcy Code has been terminated.
(xi) Any Nuverra Party files any motion seeking to avoid, disallow, subordinate or recharacterize any Claim, lien, or interest held by any Supporting Noteholder against the Company.
(xii) The Bankruptcy Court enters an order avoiding, disallowing, subordinating or recharacterizing, other than in a de minimis amount, any claim, lien, or interest held by any Supporting Noteholder against the Company, unless (A) the Company has sought a stay of such order within five (5) Business Days after the date of such issuance and such order is stayed within ten (10) Business Days after the date of such issuance and (B) such order is reversed or vacated within twenty (20) Business Days after the date of such issuance.
(xiii) The Bankruptcy Court grants relief that (i) is inconsistent with this Agreement in any material respect or (ii) would, or would reasonably be expected to, materially frustrate the purposes of this Agreement, including by preventing the consummation of the Restructuring Transaction, unless the Company has sought a stay of such relief within five (5) Business Days after the date of such issuance, and such order is stayed, reversed or vacated within ten (10) Business Days after the date of such issuance.
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(xiv) The Company files, propounds, publicly announces or otherwise supports any plan of reorganization, liquidation, sale or other transaction other than the Nuverra Plan or the Restructuring Transaction;
(xv) The Company files or enters into any Definitive Document or files any exhibits, amendments, modifications or supplements to the Nuverra Plan that were not in form and substance approved by the Supporting Noteholders.
(xvi) Any Nuverra Party files any motion or application seeking authority to sell all or a material portion of its assets.
(xvii) On the date that an order is entered by the Bankruptcy Court or a court of competent jurisdiction denying confirmation of the Nuverra Plan or refusing to approve the Disclosure Statement.
(xviii) The acceleration of the obligations or termination of commitments under either of the DIP Facilities.
(xix) Any of the Definitive Documents shall have been modified in any material respect or in a manner adverse to any Supporting Noteholder, without the prior written consent of such Supporting Noteholder.
(xx) The Company breaches any of its obligations under Section 5(b) of this Agreement.
(xxi) The issuance by any governmental authority, including any regulatory authority or court of competent jurisdiction, of any ruling, judgment or order enjoining the consummation of or rendering illegal the Nuverra Plan or the Restructuring Transaction, which ruling, judgment or order has not been not stayed, reversed or vacated within ten (10) Business Days after such issuance.
(xxii) The aggregate amount of all projected prepetition, non-contingent, undisputed claims against the Debtors, including, without limitation, all trade and unsecured claims, other than claims with respect to, without limitation, amounts owed under the ABL Credit Agreement, the Term Loan agreement, the 2021 Indenture, the indenture for the 2018 Notes, Vehicle Financing Obligations, the Ideal Oilfield APA, and the AWS Promissory Note, exceeds $8.5 million.
(xxiii) After the date of this Agreement, any one or more changes, events, occurrences, or effects, which individually or together with any other changes, events, occurrences, or effects, have or result in, or would be reasonably likely to have or result in, any material adverse change to or effect on the business, prospects, results of operations, liabilities, finances, properties, assets, or condition (financial or otherwise) of the Company taken as a whole or would have, or would reasonably be expected to have, a material adverse effect on the ability of the Company to perform its obligations under this Agreement and effect the Restructuring Transaction (a Material Adverse Change ), excluding (i) any
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effects of the filing of the Chapter 11 Cases or the announcement of such filing, (ii) any default under the 2021 Indenture, the indenture for the 2018 Notes, the ABL Facility or the Term Loan, (iii) any changes affecting economic or financial market conditions generally; and (iv) any changes affecting the oil and gas industries generally, unless these changes have a disproportionate effect on the Company; provided however , that the filing of the Chapter 11 Case and the transactions contemplated by the Nuverra Plan shall not in and of itself constitute a Material Adverse Change.
Notwithstanding any provision in this Agreement to the contrary, upon written consent of the Supporting Noteholders, each of the dates set forth in Section 6(a)(ii)-(iii) may be extended prior to or upon such date and such later dates agreed to in lieu thereof and shall be of the same force and effect as the dates provided herein.
(b) Company Termination Events . The Company may terminate this Agreement upon written notice ( Company Termination Notice ) delivered in accordance with Section 22 hereof, upon the occurrence, and during the continuation, of any of the following events (each, a Company Termination Event ):
(i) the breach in any material respect by the Supporting Noteholders of their covenants, obligations, representations, or warranties contained in this Agreement, which breach remains uncured for a period of five (5) Business Days from the earlier of (x) knowledge of such breach by a Supporting Noteholder; and (y) the date such Supporting Noteholder receives a Company Termination Notice; and
(ii) The issuance by any governmental authority, including any regulatory authority or court of competent jurisdiction, of any final, non-appealable ruling, judgment or order enjoining the consummation of or rendering impermissible a material portion of the Restructuring Transaction, which ruling, judgment or order has not been stayed, reversed or vacated within twenty (20) Business Days after such issuance.
(iii) The board of directors of the Company (the Board ), after consultation with outside counsel, reasonably determines in good faith that continued performance under this Agreement would be inconsistent with the exercise of its fiduciary duties under Applicable Law, including because such fiduciary obligations require the Board to direct the acceptance of a proposal for an alternative transaction that, provides for a higher recovery to the Companys creditors than the Nuverra Plan.
(iv) The class of 2021 Notes votes against the Nuverra Plan.
(v) Any Supporting Noteholder fails to provide the Interim Financing to the Company.
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(vi) Any Supporting Noteholder fails to provide the DIP Facilities to the Company.
(vii) At 11:59 p.m. prevailing Eastern Time on the date (x) that is five (5) Business Days after the Petition Date if the Bankruptcy Court has not entered the DIP Financing Order on an interim basis and (y) that is forty-five (45) calendar days after the Petition Date if the Bankruptcy Court has not entered the DIP Financing Order on a final basis.
(viii) On or after December 31, 2017.
(c) Mutual Termination . This Agreement may be terminated by mutual written agreement among the Company and the Supporting Noteholders.
(d) Automatic Termination . This Agreement shall automatically terminate on the Effective Date.
(e) Effect of Termination . Upon the termination of this Agreement in accordance with this Section 6 , except as provided in Section 16 herein, this Agreement shall become void and of no further force or effect, and each Party shall, except as otherwise expressly provided in this Agreement, be immediately released from its liabilities, obligations, commitments, undertakings, and agreements under or related to this Agreement and shall have all the rights and remedies that it would have had and shall be entitled to take all actions, whether with respect to the Claims or otherwise, that it would have been entitled to take had it not entered into this Agreement, including all rights and remedies available to it under Applicable Law, the ABL Credit Agreement, the Term Loan Credit Agreement, 2021 Notes, the 2021 Indenture and/or any ancillary documents or agreements thereto; provided , however , that in no event shall any such termination relieve a Party hereto from (i) liability for its breach or non-performance of its obligations hereunder prior to the date of such termination; or (ii) obligations under this Agreement that by their express terms expressly survive termination of this Agreement. Upon any such termination of this Agreement, (i) the Nuverra Plan shall automatically be deemed withdrawn and the Company shall take all action necessary to effectuate such withdrawal, and (ii) any and all consents and ballots tendered by the Supporting Noteholders prior to such termination shall be deemed, for all purposes, automatically null and void ab initio , shall not be considered or otherwise used in any manner by the Parties in connection with the Nuverra Plan and this Agreement or otherwise, and such consents or ballots may be changed or resubmitted regardless of whether the applicable voting deadline has passed (without the need to seek a court order or consent from the Company allowing such change or resubmission), and the Company shall not oppose any such change or resubmission.
Section 7. Definitive Documents; Good Faith Cooperation; Further Assurances . The definitive documents for the Restructuring Transaction (the Definitive Documents ) shall include all (i) documents implementing, achieving, and relating to the Restructuring Transaction, including, without limitation, the Restructuring Term Sheet, the Nuverra Plan, the Disclosure Statement, the Solicitation Materials, the DIP Financing
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Order, the DIP Facilities, the Confirmation Order, the Exit Facility and the Plan Supplement and its exhibits, solicitation procedures, commitment agreements, collateral or other related documents, the Registration Rights Agreement, intercreditor agreements, revised by-laws and certificates of incorporation, shareholder and member related agreements, if any, or other related transactional or corporate documents (including, without limitation, any agreements and documents described in the Restructuring Term Sheet or the Nuverra Plan and the exhibits thereto), (ii) motions or pleadings seeking approval or confirmation of any of the foregoing transactional or corporate documents, including the motion to approve the Disclosure Statement, confirm the Nuverra Plan, approve the DIP Facilities, ratify the solicitation procedures, and schedule a joint hearing, and (iii) the DIP Financing Order, the Confirmation Order and orders approving the Disclosure Statement, the solicitation procedures and the scheduling of a joint hearing. The Definitive Documents, whether filed with the Bankruptcy Court or otherwise finalized, shall be consistent with this Agreement and the Restructuring Term Sheet in all respects, and shall otherwise be acceptable to the Supporting Noteholders. Notwithstanding any other provision contained in this Agreement, the Nuverra Plan, the Confirmation Order, the Disclosure Statement, and the Exit Facility (and all exhibits and supplements thereto) shall be in form and substance acceptable to the Supporting Noteholders. Any amendments, modifications or supplements to the Definitive Documents, whether filed with the Bankruptcy Court or otherwise finalized, shall be consistent with this Agreement and the Restructuring Term Sheet in all respects, and in form and substance acceptable to the Supporting Noteholders. Each Party hereby covenants and agrees to cooperate with each other in good faith in connection with, and shall exercise reasonable best efforts with respect to, the pursuit, approval, implementation and consummation of the Restructuring Transaction, as well as the negotiation, drafting, execution and delivery of the Definitive Documents. Furthermore, subject to the terms hereof, each of the Parties shall take such action as may be reasonably necessary or reasonably requested by the other Parties to carry out the purposes and intent of this Agreement, and shall refrain from taking any action that would frustrate the purposes and intent of this Agreement.
Section 8. Representations and Warranties .
(a) Each Party, severally as to itself only (and not jointly), represents and warrants to the other Parties that the following statements are true and correct as of the date hereof (or as of the date a Party becomes a party hereto):
(i) Each Party is validly existing and in good standing under the laws of its jurisdiction of incorporation or organization, has all requisite corporate, partnership, limited liability company, or similar power and authority to enter into this Agreement and perform its obligations under, and carry out the Restructuring Transactions, and the execution and delivery of this Agreement by such Party and the performance of such Partys obligations under this Agreement have been duly authorized by all necessary corporate, limited liability company, partnership, or other similar action on its part;
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(ii) the execution, delivery and performance by such Party of this Agreement does not and will not, as applicable, (A) violate Applicable Law relevant to it or any of its Subsidiaries or its charter or bylaws (or other similar governing documents), or those of any of its Subsidiaries; or (B) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any material contract to which it or any of its Subsidiaries is a party, other than breaches that arise from (1) the commencement or filing of a voluntary or involuntary petition under any bankruptcy, insolvency or debtor relief laws of any jurisdiction or (2) any agreement to enter into or commence any bankruptcy, insolvency proceeding or any proceeding under any debtor relief laws, in each case, of any jurisdiction;
(iii) The execution, delivery and performance by such Party of this Agreement does not and will not require any material registration or filing with, consent or approval of, or notice to, or other action, with or by, any federal, state or governmental authority or regulatory body, except such filings as may be necessary or required by the SEC or other securities regulatory authorities under Applicable Law; and
(iv) This Agreement is the legally valid and binding obligation of such Party, enforceable against it in accordance with its terms, except as enforcement may be limited by Applicable Law relating to or limiting creditors rights generally or by equitable principles relating to enforceability.
(b) Each Supporting Noteholder, severally as to itself only (and not jointly), represents and warrants that, as of the date hereof (or as of the date such Supporting Noteholder becomes a party hereto):
(i) it is the sole beneficial owner of the Claims, as applicable, set forth below its name on the signature page hereof (or below its name on the signature page of a Joinder Agreement for any Supporting Noteholder that becomes a party hereto after the date hereof), and/or has, with respect to the beneficial owners of such Claims, (A) full power and authority to vote on, and consent to, matters concerning such Claims and to exchange, assign, and Transfer such Claims; or (B) full power and authority to bind, or act on behalf of, such beneficial owners holding full power and authority to vote on, and consent to matters concerning such Claims;
(ii) it has made no prior assignment, sale, participation, grant, encumbrance, conveyance, or other Transfer of, and has not entered into any other agreement to assign, sell, participate, grant, encumber, convey, or otherwise Transfer, in whole or in part, any portion of its right, title, or interests in any Claims or any voting or other rights associated therewith that is inconsistent with the representations and warranties of such Supporting Noteholder herein or would render such Supporting Noteholder otherwise unable to comply with this Agreement and perform its obligations hereunder;
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(iii) other than pursuant to this Agreement, the Claims set forth below its signature hereto are free and clear of any pledge, lien, security interest, charge, encumbrance, claim, equity, option, proxy, voting restriction, right of first refusal, or other limitation on disposition or encumbrance of any kind, that would adversely affect in any way such Supporting Noteholders performance of its obligations contained in this Agreement at the time such obligations are required to be performed;
(iv) it holds or beneficially owns no Claims that have not been set forth on the signature page hereof (or below its name on the signature page of a Joinder Agreement for any Supporting Noteholder that becomes a party hereto after the date hereof);
(v) regardless of whether its Claims constitute a security within the meaning of the Securities Act of 1933 (as amended), such Supporting Party (A) is a sophisticated investor with respect to the transactions described herein with sufficient knowledge and experience in financial and business matters and is capable of evaluating the merits and risks of owning and investing in any securities that may be issued in connection with the Restructuring Transaction, making an informed decision with respect thereto, and evaluating properly the terms and conditions of this Agreement, and it has made its own analysis and decision to enter into this Agreement; (B) is an accredited investor within the meaning of Rule 501 of Regulation D of the Securities Act of 1933 (as amended) or a qualified institutional buyer within the meaning of Rule 144A of the Securities Act of 1933 (as amended), or, if a foreign investor, of such similar sophistication; (C) is acquiring any securities that may be issued in connection with the Restructuring Transaction for its own account and not with a view to the distribution thereof; and (D) has made its own decision to execute this Agreement based upon its own independent assessment of documents and information available to it, as it deemed appropriate and sufficient.
(c) No Other Representations . Except for the representations and warranties contained in this Agreement, no such Supporting Noteholder nor any other Person makes any representation or warranty, express or implied, on behalf of such Supporting Noteholder.
(d) It is understood and agreed that the representations and warranties made by a Supporting Noteholder that is an investment manager of a beneficial owner of Claims are made with respect to, and on behalf of, such beneficial owner and not such investment manager, and, if applicable, are made severally (and not jointly) with respect to the investment funds, accounts, and other investment vehicles managed by such investment manager.
Section 9. Amendments and Waivers . Except as otherwise expressly set forth herein, this Agreement, the Restructuring Term Sheet and Nuverra Plan, including any exhibits or schedules hereto or thereto, may not be waived, modified, amended or
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supplemented except in a writing signed by all Parties to this Agreement. Notwithstanding the foregoing, the Company may amend, modify or supplement the Nuverra Plan, from time to time, without the consent of any Supporting Noteholder, in order to cure any ambiguity, defect (including any technical defect) or inconsistency; provided , that any such amendments, modifications or supplements do not adversely affect the rights, interests or treatment of such Supporting Noteholders under the Nuverra Plan.
Section 10. Effectiveness . This Agreement shall become effective and binding upon each Party upon the delivery of duly authorized and executed signature pages hereto by (a) the Nuverra Parties; and (b) the Supporting Noteholders (the Support Effective Date ).
Section 11. GOVERNING LAW; JURISDICTION; WAIVER OF JURY TRIAL . THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ANY CONFLICTS OF LAW PROVISIONS WHICH WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER JURISDICTION. BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE PARTIES HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ANY LEGAL ACTION, SUIT, DISPUTE, OR PROCEEDING ARISING UNDER, OUT OF OR IN CONNECTION WITH THIS AGREEMENT SHALL BE BROUGHT IN THE FEDERAL OR STATE COURTS LOCATED IN THE STATE OF NEW YORK, COUNTY OF NEW YORK, OR THE DISTRICT OR BANKRUPTCY COURTS LOCATED IN THE DISTRICT OF DELAWARE AND THE PARTIES HERETO IRREVOCABLY CONSENT TO THE JURISDICTION OF SUCH COURTS AND WAIVE ANY OBJECTIONS AS TO VENUE OR INCONVENIENT FORUM. EACH PARTY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 12. Specific Performance/Remedies . Subject to the Parties termination rights provided herein, each Party hereto recognizes and acknowledges that a breach by it of any covenants or agreements contained in this Agreement will cause other Parties to sustain damages for which such Parties would not have an adequate remedy at law for money damages, and therefore each Party agrees that in the event of any such breach, in addition to any other remedy to which such nonbreaching Party may be entitled, at law or in equity, such nonbreaching Party shall be entitled, to the extent available, to the remedy of specific performance of such covenants, including without limitation, to seek the order of any court of competent jurisdiction requiring any Party to comply promptly with any of its obligations hereunder. Each Party agrees to waive any requirement for the securing or posting of a bond in connection with such remedy.
Section 13. Disclosure; Publicity .
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(a) Subject to the Supporting Noteholders executing a satisfactory non-disclosure agreement, the Company shall submit drafts of all written public statements regarding the Restructuring Transaction in whatever form, to the Supporting Noteholders. The Company shall submit drafts to the Supporting Noteholders legal advisors of any press releases, public documents, and any and all filings with the SEC that (i) constitute disclosure of the existence or terms of this Agreement or any amendment to the terms of this Agreement at least two (2) Business Days prior to making any such disclosure; or (ii) any other disclosure that includes descriptions of the Restructuring Transaction or any Supporting Noteholder and shall negotiate any proposed changes thereto in good faith.
(b) Except as required by Applicable Law or otherwise permitted under the terms of any other agreement between the Company and any such Supporting Noteholder, no Party or its advisors shall disclose to any Person, other than advisors to the Company, the principal amount or percentage of 2021 Notes held by any Supporting Noteholder, in each case, without such Supporting Noteholders prior written consent; provided , that (a) if such disclosure is required by Applicable Law, the disclosing Party shall afford the relevant Supporting Noteholder a reasonable opportunity to review and comment in advance of such disclosure and shall take all reasonable measures to limit such disclosure, at the sole cost and expense of the relevant Supporting Noteholder, (b) the foregoing shall not prohibit the disclosure of the aggregate percentage or aggregate principal amount of the 2021 Notes held by the Supporting Noteholders collectively, and (c) any Party may disclose information requested by a regulatory authority with jurisdiction over its operations to such authority without limitation or notice to any Party or other Person. Any public filing of this Agreement, with the Bankruptcy Court or otherwise, which includes executed signature pages to this Agreement shall include such signature pages only in redacted form with respect to the holdings of each Supporting Noteholder (provided that the holdings disclosed in such signature pages may be filed in unredacted form with the Bankruptcy Court under seal).
Section 14. Creditors Committee . The Parties agree not to request that the United States Trustee appoint an official committee of creditors in the Chapter 11 Cases.
Section 15. Survival . Notwithstanding the termination of this Agreement pursuant to Section 6 , Sections Section 11-Section 12, Section 13(b), Section 15-Section 18, and Sections Section 22-Section 24 shall survive such termination and shall continue in full force and effect in accordance with the terms hereof; provided , that any liability of a Party for failure to comply with the terms of this Agreement shall survive such termination.
Section 16. Successors and Assigns; Severability; Several Obligations . This Agreement is intended to bind and inure to the benefit of the Parties and their respective successors, assigns, heirs, executors, administrators, and representatives; provided , however , that nothing contained in this Section 16 shall be deemed to permit sales, assignments, or other Transfers of Claims. If any provision of this Agreement, or the application of any such provision to any Person or circumstance, shall be held invalid or unenforceable in whole or in part, such invalidity or unenforceability shall attach only to
22
such provision or part thereof and the remaining part of such provision hereof and this Agreement shall continue in full force and effect; provided , however , that nothing in this Section 16 shall be deemed to amend, supplement, or otherwise modify, or constitute a waiver of, any Supporting Noteholder Termination Event or any Company Termination Event.
Section 17. No Third-Party Beneficiaries . Unless expressly stated herein, this Agreement shall be solely for the benefit of the Parties and no other Person shall be a third-party beneficiary hereof.
Section 18. Prior Negotiations; Entire Agreement . This Agreement, including the exhibits and schedules hereto, constitutes the entire agreement of the Parties, and supersedes all other prior negotiations, with respect to the subject matter hereof, except that the Parties acknowledge that any confidentiality agreements (if any) heretofore executed between the Company and any Supporting Noteholder shall continue in full force and effect.
Section 19. Headings . The headings of the sections, paragraphs, and subsections of this Agreement are inserted for convenience only and shall not affect the interpretation hereof or, for any purpose, be deemed a part of this Agreement.
Section 20. Counterparts . This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, and all of which together shall be deemed to be one and the same agreement. Execution copies of this Agreement may be delivered by facsimile, e-mail, or otherwise, which shall be deemed to be an original for the purposes of this Section 20 . Without in any way limiting the provisions hereof, additional Supporting Noteholders may elect to become Parties by executing and delivering to the Company a counterpart hereof. Such additional holder shall become a Party to this Agreement in accordance with the terms of this Agreement.
Section 21. Notices . All notices, requests, demands, document deliveries, and other communications under this Agreement shall be in writing and shall be deemed to have been duly given, provided or made (a) when delivered personally; (b) when sent by electronic mail ( e-mail ); or (c) one Business Day after deposit with an overnight courier service, with postage prepaid to the Parties at the following addresses or e-mail addresses (or at such other addresses or e-mail addresses for a Party as shall be specified by like notice):
If to the Company:
Nuverra Environmental Solutions, Inc.
14624 North Scottsdale Road, Suite 300
Scottsdale, AZ 35254
Attn: Joe Crabb
Robert D. Albergotti
Phone: 602-903-7407
joe.crabb@nuverra.com
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ralbergotti@alixpartners.com
with a copy to (which shall not constitute notice):
Shearman & Sterling LLP
599 Lexington Avenue
New York, NY 10022
Attn: Douglas Bartner, Esq.
Fredric Sosnick, Esq.
Sara Coelho, Esq.
Phone: 212-848-4000
douglas.bartner@shearman.com
fredric.sosnick@shearman.com
sara.coelho@shearman.com
If to the Supporting Noteholders:
To each Supporting Noteholder at the addresses or e-mail addresses set forth below the Supporting Noteholders signature page to this Agreement (or to the signature page to a Joinder Agreement in the case of any Supporting Noteholder that becomes a party hereto after the Support Effective Date).
with a copy (which shall not constitute notice) to the Supporting Noteholders Advisors at:
Fried, Frank, Harris, Shriver & Jacobson LLP
One New York Plaza
New York, New York 10004
Attn: Brad Eric Scheler, Esq.
Jennifer L. Rodburg, Esq.
Phone: 212-859-8019
Fax: 212-859-4000
brad.scheler@friedfrank.com
jennifer.rodburg@friedfrank.com
Section 22. Reservation of Rights; No Admission . Subject to and except as expressly provided in this Agreement or in any amendment thereof agreed upon by the Parties pursuant to the terms hereof, nothing herein is intended to, or does, in any manner waive, limit, impair, or restrict the ability of each of the Parties to protect and preserve its rights, remedies, and interests, including its claims against any of the other Parties (or their respective Affiliates or Subsidiaries). Without limiting the foregoing sentence in any way, if the Restructuring Transaction is not consummated, or if this Agreement is terminated for any reason, nothing in this Agreement shall be construed as a waiver by
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any Party of any or all of such Partys rights, remedies, claims, and defenses, and the Parties expressly reserve any and all of their respective rights, remedies, claims, and defenses. This Agreement is part of a proposed settlement of matters that could otherwise be the subject of litigation among the Parties. Pursuant to Rule 408 of the Federal Rules of Evidence, any applicable state rules of evidence and any other Applicable Law, this Agreement and all negotiations relating thereto shall not be admissible into evidence in any proceeding other than a proceeding to enforce its terms. This Agreement shall in no event be construed as, or be deemed to be, evidence of an admission or concession on the part of any Party of any claim or fault or liability or damages whatsoever. Each of the Parties denies any and all wrongdoing or liability of any kind and does not concede any infirmity in the claims or defenses which it has asserted or could assert.
Section 23. Representation by Counsel . Each Party acknowledges that it has been represented by counsel with respect to this Agreement and the Restructuring Transaction. Accordingly, any Applicable Law that would provide any Party with a defense to the enforcement of the terms of this Agreement against such Party based upon lack of legal counsel shall have no application and is expressly waived. No Party shall be considered to be the drafter of this Agreement or any of its provisions for the purpose of any Applicable Law that would, or might cause, any provision to be construed against such Party.
Section 24. Relationship among Parties . Notwithstanding anything herein to the contrary, the duties and obligations of the Supporting Noteholders under this Agreement shall be several, not joint. It is understood and agreed that no Supporting Noteholder has any duty of trust or confidence of any kind or form with respect to any other Supporting Noteholder or the Company, and, except as expressly provided in this Agreement, there are no commitments between or among them. In this regard, it is understood and agreed that any Supporting Noteholder may trade in the Claims without the consent of the Company or any other Supporting Noteholder, subject to Applicable Laws and the terms of this Agreement; provided , however , that no Supporting Noteholder shall have any responsibility for any such trading to any other Person by virtue of this Agreement. No prior history, pattern, or practice of sharing confidences between or among the Supporting Noteholders or the Company shall in any way affect or negate this Agreement. No Supporting Noteholder shall, as a result of its entering into and performing its obligations under this Agreement, be deemed to be part of a group (as that term is used in section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder) with any of the other Supporting Noteholders.
[Signature pages follow]
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and delivered by their respective duly authorized officers, solely in their respective capacity as officers of the undersigned and not in any other capacity, as of the date first set forth above.
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. |
By: |
Name: | ||
Title: | ||
Nuverra Environmental Solutions, Inc. Appalachian Water Services, LLC Badlands Leasing, LLC Badlands Power Fuels, LLC (DE) Badlands Power Fuels, LLC (ND) Heckmann Water Resources Corporation Heckmann Water Resources (CVR) Inc. Heckmann Woods Cross, LLC HEK Water Solutions, LLC Ideal Oilfield Disposal, LLC Landtech Enterprises, L.L.C. NES Water Solutions, LLC Nuverra Total Solutions, LLC 1960 Well Services, LLC |
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NUVERRA ENVIRONMENTAL SOLUTIONS, INC., As agent and attorney-in-fact for each of the foregoing entities |
By: |
|
Name: | ||
Title: |
STRICTLY CONFIDENTIAL | ||||
[SUPPORTING NOTEHOLDER] | ||||
By: | ||||
Name: | ||||
Title: |
STRICTLY CONFIDENTIAL | ||||
[SUPPORTING NOTEHOLDER] | ||||
By: | ||||
Name: | ||||
Title: |
STRICTLY CONFIDENTIAL | ||||
[SUPPORTING NOTEHOLDER] | ||||
By: | ||||
Name: | ||||
Title: |
STRICTLY CONFIDENTIAL | ||||
[SUPPORTING NOTEHOLDER] | ||||
By: | ||||
Name: | ||||
Title: |
STRICTLY CONFIDENTIAL | ||||
[SUPPORTING NOTEHOLDER] | ||||
By: | ||||
Name: | ||||
Title: |
EXHIBIT A
Restructuring Term Sheet
NUVERRA ENVIRONMENTAL SOLUTIONS, INC.
S UMMARY OF P RINCIPAL T ERMS AND C ONDITIONS OF R ESTRUCTURING
This term sheet (the Restructuring Term Sheet ) outlines certain of the principal economic terms of a proposed restructuring (the Restructuring Transaction ) of the outstanding indebtedness of, and equity interests in, Nuverra Environmental Solutions, Inc. and its direct and indirect domestic affiliates and subsidiaries. The proposed terms and conditions set forth in this Restructuring Term Sheet are intended as an outline of certain material terms of the Restructuring Transaction. This Restructuring Term Sheet does not include descriptions of all terms, conditions and other provisions that would be contained in definitive documentation related to a financial restructuring and is not intended to limit the scope of discussion or negotiation of any matters not inconsistent with the specific matters set forth herein. The transactions contemplated by this Restructuring Term Sheet will be subject to the terms and conditions to be set forth in definitive documents at a later date. This Restructuring Term Sheet does not constitute an offer of securities or a solicitation of the acceptance or rejection of any restructuring or similar plan. The Restructuring Transaction is intended to be effectuated through a pre-packaged in-court restructuring and chapter 11 plan of reorganization described below.
This Restructuring Term Sheet is strictly confidential and may not be shared with any person.
I. GENERAL |
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Company; Debtors | Nuverra Environmental Solutions, Inc. (the Company ) together with the following of its subsidiaries that are parties to the RSA (as defined below): Heckmann Water Resources Corporation, Heckmann Water Resources (CVR) Inc., 1960 Well Services, LLC, HEK Water Solutions, LLC, Appalachian Water Services, LLC, Badlands Power Fuels, LLC (a Delaware limited liability company), Badlands Power Fuels, LLC (a North Dakota limited liability company), Landtech Enterprises, L.L.C., Badlands Leasing, LLC, Ideal Oilfield Disposal, LLC, Nuverra Total Solutions, LLC, NEW Water Solutions, LLC, and Heckmann Woods Cross, LLC (collectively, the Debtors , and subsequent to emergence from chapter 11 pursuant to the order confirming the Plan, the Reorganized Debtors ). | |
ABL Lenders | Lenders (collectively, ABL Lenders ) under the ABL Facility due March 31, 2017, inclusive of any revolving loans or letters of credit outstanding (as amended, restated or otherwise modified from time to time, the ABL Facility ). As of April 6, 2017, approximately $32.9 million plus accrued and unpaid interest thereunder was outstanding under the ABL Facility. | |
Term Lenders | Ascribe Capital LLC ( Ascribe ) and Gates Capital Management, Inc. ( Gates and together with Ascribe, the Term Lenders ) as lenders under the last-out first lien term loan due April 15, 2021 (as amended, restated or otherwise modified from time to time, the Term Loan ). As of March 30, 2017, $58.1 million plus accrued and unpaid interest thereunder was outstanding under the Term Loan. | |
2021 Noteholders | Holders (collectively, 2021 Noteholders ) of $327,221,000 in principal amount of 12.50%/10.0% second lien notes (the 2021 Notes ) due April 15, 2021. 1 As of April 6, 2017, Ascribe and Gates hold 82.66% of the 2021 Notes (including all outstanding capitalized interest paid-in-kind) and shall be |
1 | Interest payable at 12.5% PIK before April 15, 2018 and thereafter until maturity at 10% of which 50% will PIK and 50% in cash. |
referred to herein, collectively, as the Supporting Noteholders . | ||
2018 Noteholders | Holders (collectively, 2018 Noteholders ) of $40.4 million in principal amount of 9.875% senior unsecured notes (the 2018 Notes ) due April 15, 2018. | |
Vehicle Financing Obligations | Vehicle financings obligations of the Debtors under agreements for the leasing, purchase or other financing of vehicles used in the Companys business, as of March 30, 2017, in the aggregate principal amount of $6.7 million (the Vehicle Financing Obligations ). | |
AWS Promissory Note | AWS Promissory Note in the aggregate principal amount of $4.5 million (the AWS Promissory Note ). | |
Existing Equity Holders | Holders (collectively, Existing Equity Holders ) of all equity interests and options to purchase equity interests in the Company, including, without limitation, the 150,940,973 shares of common stock in the Company, as of March 31, 2017, and the penny warrants issued in connection the Companys exchange offer and incurrence of the Term Loan in April 2016 (collectively, the Existing Equity Interests ). | |
Restructuring Transaction | Subject to the terms hereof, the Debtors shall file for chapter 11 relief in the District of Delaware (the Bankruptcy Court ) to restructure their balance sheets through a pre-packaged plan of reorganization (the Plan ). The Plan shall be consistent with the terms of this Restructuring Term Sheet and satisfactory in form and substance to the Debtors and the Supporting Noteholders, acting reasonably and in good faith. | |
Plan Support | The Supporting Noteholders shall enter into a restructuring support agreement (the RSA ) with the Company wherein they will commit to support the Restructuring Transaction and the Plan. | |
II. FINANCING |
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Debtor in Possession Financing | The Debtors shall be provided with debtor-in-possession financing (the DIP Facilities ) consisting of one or more of the following: (a) a super-priority, secured, debtor-in-possession revolving credit facility (the DIP Revolving Facility ) provided by the ABL Lenders (in such capacity, the DIP Revolving Lenders ) and (b) a super-priority, secured, debtor-in-possession term loan facility (the DIP Term Facility ) provided by one or more of the Term Lenders (in such capacity, the DIP Term Lenders , and together with the DIP Revolving Lenders, the DIP Lenders ). The DIP Facilities, and all borrowings thereunder, shall be subject to a budget updated monthly (with weekly cash reporting) and approved by the DIP Lenders. The terms and conditions of the DIP Facilities shall be acceptable to the Supporting Noteholders and the Debtors, acting reasonably and in good faith. | |
Plan Funding |
The Reorganized Debtors shall be funded on effective date of the Plan (the Effective Date ) by the proceeds of the Rights Offering (as defined below) and, if necessary, the Exit Facility (as defined below).
The proceeds of the Rights Offering and Exit Facility shall be in an aggregate amount which shall be sufficient to fund required distributions under the Plan, including to pay in full all outstanding amounts under the DIP Facilities |
ABL Facility Claims and DIP Revolving Facility | On the Effective Date, the ABL Lenders shall, in full satisfaction of their ABL Facility claims and DIP Revolving Claims, be paid in full in cash from proceeds of the Exit Facility. | |||||
DIP Term Loans and Term Loan Claims | On the Effective Date, in full satisfaction of the claims arising under the DIP Term Loans and Term Loans outstanding as of the Effective Date (collectively, the Term Loan Claims ), the Term Loan Claims shall be treated as follows: | |||||
(A) |
(i) $75 million of Term Loan Claims shall convert into New Common Stock at the Plan Value, subject to dilution by the MIP (as defined below), the Rights Offering and as a result of the conversion of the Remainder Term Loan Claim Conversion (as defined below) and (ii) the Term Lenders shall receive an equity conversion fee equal to 5% of $75 million, payable in New Common Stock issued at the Plan Value ((i) and (ii), the Term Loan Claim Conversion ); and | |||||
(B) |
The remaining Term Loan Claims, if any, (the Remainder Term Loan Claims ) shall, | |||||
i. |
First , to the extent of available proceeds from the Rights Offering in excess of $50 million after repayment of the ABL Facility Claims and payment of costs and expenses of the chapter 11 cases, be paid in cash from the proceeds of the Rights Offering, and | |||||
ii. |
Second , any remaining balance shall be converted into New Common Stock at the Plan Value (the Remainder Term Loan Claim Conversion ), subject to dilution by the MIP (as defined below) and the Rights Offering. | |||||
2021 Notes Claims | On the Effective Date, the 2021 Noteholders shall receive, in full satisfaction of their 2021 Notes claims, their pro rata share of (a) 99.75% of the New Common Stock, subject to dilution by the MIP, the Rights Offering, the Term Loan Claim Conversion and the Remainder Term Loan Claim Conversion and (b) 50% of the Rights. The Rights issued to holders of the 2021 Note Claims shall be exercisable for a period up to two years following the Effective Date; provided , that the Rights issued to holders of the 2021 Note Claims shall expire upon (i) consummation of a registered public offering with net proceeds in excess of an amount to be determined by the Supporting Noteholders prior to the Effective Date, and (2) consummation of a merger, acquisition or other business combination with a transaction value in excess of an amount to be determined by the Supporting Noteholders prior to Effective Date. | |||||
2018 Notes Claims | Subject to agreement among the Supporting Noteholders and the Debtors, on the Effective Date, the 2018 Noteholders shall receive, in full satisfaction of their 2018 Notes claims, (a) their pro rata share, together with Existing Equity, of 0.25% of the New Common Stock, subject to dilution by the MIP, the Rights Offering, the Term Loan Claim Conversion and the Remainder Term Loan Claim Conversion and (b) a portion of 50% of the Rights, in an amount to be determined by the Company. The Rights issued to holders of the 2018 Note Claims shall be exercisable prior to the Effective Date. | |||||
Vehicle Financing Obligations | The legal, equitable, and contractual rights under the Vehicle Financing Obligations will be unaltered by the Restructuring Transaction or the Plan. On the Effective Date, the Debtors will assume all executory contracts and any |
Debtors with equity-based incentive grants (including, without limitation, options and restricted stock units) for ten percent (10%) of the fully-diluted shares the New Common Stock. MIP awards of equity-based incentives not granted on the Effective Date or shortly thereafter will remain in the MIP reserve pool for future grants. The specific identities of recipients, amounts and timing of MIP grants and other terms and conditions of the MIP will be determined by the New Board. | ||
Charter, By-Laws and Organizational Documents | All charters, by-laws, limited liability company agreements and other organizational documents of the Reorganized Debtors shall be amended or amended and restated to comply with any applicable provisions of the Bankruptcy Code and as agreed to by the Debtors and the Supporting Noteholders, acting reasonably and in good faith. | |
V. OTHER PLAN TERMS |
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Exemption from SEC Registration | The issuance and distribution of the New Common Stock and Rights shall be exempt from registration under the Securities Act of 1933 and any other applicable securities laws pursuant to Section 1145 of the Bankruptcy Code. | |
Registration Rights | On the Effective Date, the Reorganized Debtors, the Supporting Noteholders and significant holders of New Common Stock shall enter into a registration rights agreement (the Registration Rights Agreement ), which agreement shall be in form and substance acceptable to the Debtors and the Supporting Noteholders, acting reasonably and in good faith. The Registration Rights Agreement shall provide for the Reorganized Debtors, promptly following the Effective Date, to use best efforts to take all necessary actions to enhance the public float of the New Common Stock, including the filing of applicable registration statements and resale shelves as soon as practicable, and to pursue all transactions (strategic or otherwise) to enhance the liquidity of holders of the New Common Stock. | |
Reporting | Following the Effective Date, the Reorganized Debtors will continue to be a public reporting company under the Securities Exchange Act of 1934 and will use best efforts to have the New Common Stock listed on the New York Stock Exchange or another nationally recognized exchange, as soon as practicable following the Effective Date. | |
Listing | The Reorganized Debtors shall use their reasonable best efforts to have the New Common Stock listed on the New York Stock Exchange or such other exchange acceptable to the Supporting Noteholders. | |
Releases and Exculpation |
The board of directors of the Company and the senior management in place immediately prior to the Effective Date, the DIP Lenders, the ABL Lenders, the Term Lenders and the 2021 Noteholders will receive releases and exculpation (from each other, from the Debtors, the Reorganized Debtors and from holders of claims against and interests in the Debtors) on customary terms.
D&O coverage and indemnity obligations will continue without any lapses for the board of directors of the Company and the senior management in place immediately prior to the Effective Date, as well as for newly appointed directors and officers. |
Tax Structure | To the extent possible, the Restructuring Transaction contemplated by this Restructuring Term Sheet will be structured so as to obtain the most tax-efficient structure, as determined by the Supporting Noteholders, acting reasonably and in good faith, in consultation with the Company, for the Debtors or the Reorganized Debtors and their equity holders post-transaction. | |
Professional Fees and Expenses | The Plan shall provide that all of the Supporting Noteholders professional fees and out-of-pocket expenses incurred in connection with the Restructuring Transaction or any other matter in connection therewith, including, without limitation, those fees and expenses incurred during the Debtors chapter 11 cases, shall be paid by the Debtors prior to and as a condition to the occurrence of the Effective Date without need for a fee application or Bankruptcy Court approval. | |
Executory Contracts and Unexpired Leases | Except with respect to all existing employment agreements, which shall be rejected, all executory contracts and unexpired leases shall be deemed assumed pursuant to the Plan unless expressly rejected by the Debtors with the consent of the Supporting Noteholders. The Debtors shall expressly assume the reimbursement agreement by and among the Company and the Supporting Noteholders, which memorializes the Companys obligation to reimburse the Supporting Noteholders professional fees and out-of-pocket expenses. | |
Ideal Oilfield APA | Subject to agreement among the Supporting Noteholders and the Debtors acting reasonably and in good faith, either (1) the legal, equitable, and contractual rights under the legal, equitable, and contractual rights under that certain Purchase and Sale Agreement by and Among Badlands Power Fuels, LLC, Ideal Oilfield Disposal, LLC, TDL Resources LLC, 9 Zs LLC and Chax Holdings, LLC dated as of May 19, 2013 (the Ideal Oilfield APA ) shall be assumed or (2) the Ideal Oilfield APA shall be rejected and, in either case, any amounts determined to be due under the Ideal Oilfield APA shall be satisfied by the Debtors or Reorganized Debtors, as applicable, with consideration in the form of New Common Stock or cash, as agreed to by the Supporting Noteholders and the Debtors, acting reasonably and in good faith. | |
Additional Plan Provisions and Documentation | The Plan shall contain other customary provisions for chapter 11 plans of this type. The Plan and all supporting and implementing documentation (including briefs and other pleadings filed in support thereof, all documents filed as part of any plan supplement and the order confirming the Plan) shall be in form and substance acceptable to the Debtors and the Supporting Noteholders, acting reasonably and in good faith. | |
VI. OTHER TERMS |
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Governing Law | New York. | |
Press Releases | Subject to applicable law or rules of any securities exchange and execution of a satisfactory non-disclosure agreement, advance review of all public statements by the Company or the Debtors related to the Restructuring Transaction (including press releases, Form 8Ks or other statements) shall be provided to the Supporting Noteholders prior to filing, and the Debtors will, in good, faith consider any comments provided by the Supporting Noteholders. | |
Certain Closing and Other Conditions to the Restructuring | The Restructuring Transaction and the occurrence of the Effective Date of the Plan shall be subject to usual and customary and necessary conditions for a transaction of this type, as well as other conditions satisfactory to the Debtors |
Transaction | and the Supporting Noteholders acting reasonably and in good faith, including, without limitation: | |||
| The terms, conditions and circumstances of any and all material court or transaction documents relating to the Restructuring Transaction and the Debtors shall be acceptable to the Supporting Noteholders in all respects and will have been reviewed and expressly approved by the Supporting Noteholders. | |||
| All of the DIP Term Lenders and Supporting Noteholders professional fees and out-of-pocket expenses incurred in connection with the Restructuring Transaction or any other matter in connection thereto, including, without limitation, those fees and expenses incurred during the Debtors chapter 11 cases, shall have been paid by the Debtors as a condition to the Effective Date. | |||
| Entry into the New Employment Agreements on terms acceptable to the Debtors and the Supporting Noteholders. | |||
| To the extent that the Restructuring Transaction would trigger a change of control payment or similar payment payable to any employee of the Debtors, or a claim of an employee arising from the rejection of an employment agreement, all such employees shall permanently waive such payments and claims. | |||
| The Restructuring Transaction shall be structured in the most tax efficient manner to effectuate the Plan as determined by the Supporting Noteholders, acting reasonably and in good faith, in consultation with the Debtors, and all accounting treatment and other tax matters shall be resolved to the satisfaction of the Supporting Noteholders in consultation with the Debtors. | |||
| All requisite governmental or regulatory approvals for the Restructuring Transaction shall have been obtained and no governmental or regulatory authority shall have taken any action that could reasonably be expected to have a material adverse effect on the consummation (including, without limitation, timing) of the Restructuring Transaction. | |||
| Subject to and as more specifically described in the RSA, there is no material adverse change to the assets, liabilities, businesses or prospects of the Debtors which occurs or is discovered after the date of execution of the RSA. | |||
| The aggregate amount of all projected prepetition, non-contingent, undisputed claims against the Debtors, including, without limitation, all trade and unsecured claims, other than claims with respect to amounts owed under the ABL Credit Agreement, the Term Loan Agreement, the 2021 Indenture, the 2018 Indenture, Vehicle Financing Obligations, the Ideal Oilfield APA and the AWS Promissory Note, shall not exceed $8.5 million. |
Confidential
EXHIBIT B
Terms of Interim Financing
EXHIBIT C
Form of Joinder Agreement
Joinder Agreement
April 9, 2017
The undersigned ( Transferee ) hereby acknowledges that it has reviewed and understands the Restructuring Support Agreement, dated as of April 9, 2017, 2017, a copy of which is attached hereto as Annex I (as amended, supplemented or otherwise modified from time to time, the Agreement ), by and among Nuverra Environmental Solutions, Inc., a Delaware corporation ( Nuverra ), and each of the other Subsidiary guarantors parties thereto (collectively, the Company ) and the Person named therein as Supporting Noteholders , and that it has been represented, or has had the opportunity to be represented, by counsel with respect to the Agreement. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in the Agreement.
1. Agreement to be Bound . The Transferee hereby agrees to be bound by all of the terms of the Agreement. The Transferee shall hereafter be deemed to be a Supporting Noteholder and a Party for all purposes under the Agreement and with respect to all Claims held by such Transferee.
2. Representations and Warranties . The Transferee hereby makes the representations and warranties of the Supporting Noteholders set forth in Section 8 of the Agreement to each other Party or only the Company (as applicable).
3. Governing Law . This Joinder Agreement shall be governed by and construed in accordance with the internal laws of the State of New York, without regard to any conflicts of law provisions which would require the application of the law of any other jurisdiction.
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IN WITNESS WHEREOF, the Transferee has caused this Joinder Agreement to be executed as of the date first written above.
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[Claim or Equity Interest Acquired] |
Exhibit 10.2
SIXTH AMENDMENT (INCREASE AMENDMENT)
TO
TERM LOAN CREDIT AGREEMENT
THIS SIXTH AMENDMENT (INCREASE AMENDMENT) TO TERM LOAN CREDIT AGREEMENT (this Amendment ) is entered into as of April 6, 2017, by and among the lenders identified on the signature pages hereof, WILMINGTON SAVINGS FUND SOCIETY, FSB, as administrative agent (in such capacity, Administrative Agent ), WELLS FARGO BANK, NATIONAL ASSOCIATION, as collateral agent (in such capacity, Collateral Agent ), NUVERRA ENVIRONMENTAL SOLUTIONS, INC., a Delaware corporation ( Borrower ), and the entities listed on Schedule 1 ( Guarantors ).
W I T N E S S E T H:
WHEREAS, Borrower, the Administrative Agent and Lenders are parties to that certain Term Loan Credit Agreement, dated as of April 15, 2016 (as amended by that certain First Amendment to Term Loan Credit Agreement, dated as of June 30, 2016, as further amended by that certain Second Amendment to Term Loan Credit Agreement, dated as of September 22, 2016, as further amended by that certain Third Amendment (Increase Amendment) to Term Loan Credit Agreement, dated as of November 14, 2016, as further amended by that certain Fourth Amendment (Increase Amendment) to Term Loan Credit Agreement, dated as of December 16, 2016, and as further amended by that certain Fifth Amendment (Increase Amendment) to Term Loan Credit Agreement, dated as of April 3, 2017, and as amended, restated, modified or supplemented from time to time prior to the date hereof, the Existing Credit Agreement ; the Existing Credit Agreement, as amended by this Amendment and as may be further amended, restated, modified or supplemented from time to time after the date hereof, is herein referred to as the Amended Credit Agreement );
WHEREAS, Borrower has requested that certain Lenders extend April 6, 2017 Additional Term Loans (as defined) to Borrower, and each April 6, 2017 Additional Term Loan Lender (as defined) party hereto has agreed to provide such April 6, 2017 Additional Term Loans to Borrower on the terms and conditions set forth herein and in the Amended Credit Agreement; and
WHEREAS, the Lenders are willing to provide the April 6, 2017 Additional Term Loans to Borrower in order to address Borrowers short-term liquidity needs and to provide sufficient financing to bridge to an agreement on the terms of a long-term solution and consensual restructuring transaction for Borrower;
NOW, THEREFORE, in consideration of the premises and mutual agreements herein contained, the parties hereto agree as follows:
1. Defined Terms . Unless otherwise defined herein, capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Amended Credit Agreement.
2. Amendments to Existing Credit Agreement . In reliance upon the representations and warranties of Borrower set forth in Section 6 below, and subject to the satisfaction of the conditions to effectiveness set forth in Section 4 below, the Existing Credit Agreement is hereby amended as follows:
(a) Schedule 1.1 thereof shall be amended by adding the following definitions in appropriate alphabetical order:
April 6, 2017 Additional Term Commitment means, with respect to each April 6, 2017 Additional Term Loan Lender, its April 6, 2017 Additional Term Commitment,
and, with respect to all April 6, 2017 Additional Term Loan Lenders, their April 6, 2017 Additional Term Commitments, in each case as such Dollar amounts are set forth beside such April 6, 2017 Additional Term Loan Lenders name under the applicable heading on Schedule C-1 to the Sixth Amendment.
April 6, 2017 Additional Term Loan means the Term Loans made pursuant to the Sixth Amendment.
April 6, 2017 Additional Term Loan Lender means each Lender party to the Sixth Amendment that has an April 6, 2017 Additional Term Commitment.
Sixth Amendment means the Sixth Amendment (Increase Amendment) to Term Loan Credit Agreement in respect of this Agreement, dated as of April 6, 2017, among Borrower, the Guarantors, party thereto, the Administrative Agent, the Collateral Agent and the Lenders party thereto.
Sixth Amendment Effective Date means April 6, 2017, which is the date on which each of the conditions set forth in Section 4 of the Sixth Amendment has been satisfied and the April 6, 2017 Additional Term Loans have been funded by the April 6, 2017 Additional Term Loan Lenders.
(b) Schedule 1.1 thereof shall be amended by deleting the definitions set forth below in their entirety and replacing them with the following:
Rolling Budget means a projected statement of sources and uses of cash for the Loan Parties and their Subsidiaries on a weekly basis, for the following 13 calendar weeks, including any anticipated use of the proceeds of Additional Term Loans, December 2016 Additional Term Loans, April 3, 2017 Additional Term Loans, and/or April 6, 2017 Additional Term Loans held in the Master Account for each week during such period and setting forth on a cumulative roll-forward basis, the projected cash disbursements and projected cash receipts for each applicable week, in form and substance reasonably satisfactory to the Lenders.
Term Commitment means an Original Term Commitment, an Additional Term Commitment, a December 2016 Additional Term Commitment, an April 3, 2017 Additional Term Commitment, or an April 6, 2017 Additional Term Commitment, or all of them, as the context may require.
Term Loan means an Original Term Loan, an Additional Term Loan, a December 2016 Additional Term Loan, an April 3, 2017 Additional Term Loan, or an April 6 Additional Term Loan, or all of them, as the context may require.
(c) Schedule C-1 thereof shall be amended and restated in its entirety by Schedule C-1 attached to this Amendment.
(d) Section 2.1(a) thereof shall be amended and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement, each Term Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Closing Date in an amount not to exceed such Lenders Original Term Commitment. Subject to the terms and conditions of this Agreement, each
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Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Third Amendment Effective Date in an amount not to exceed such Additional Term Loan Lenders Additional Term Commitment. Subject to the terms and conditions of this Agreement, each December 2016 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Fourth Amendment Effective Date in an amount not to exceed such December 2016 Additional Term Loan Lenders December 2016 Additional Term Commitment. Subject to the terms and conditions of this Agreement, each April 3, 2017 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Fifth Amendment Effective Date in an amount not to exceed such April 3, 2017 Additional Term Loan Lenders April 3, 2017 Additional Term Commitment. Subject to the terms and conditions of this Agreement, each April 6, 2017 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Sixth Amendment Effective Date in an amount not to exceed such April 6, 2017 Additional Term Loan Lenders April 6, 2017 Additional Term Commitment.
(e) Section 6.11 thereof shall be amended and restated in its entirety as follows:
6.11 Use of Proceeds .
(a) Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any Original Term Loan made hereunder on the Closing Date for any purpose other than (i) on the Closing Date, to pay the fees, costs, and expenses incurred in connection with this Agreement, the other Loan Documents, and the transactions contemplated hereby and thereby, and (ii) thereafter, consistent with the terms and conditions hereof, for their lawful and permitted purposes (including the repurchase, redemption, prepayment or other acquisition of any Bond Debt). Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any Additional Term Loan made under the Third Amendment on the Third Amendment Effective Date for any purpose other than (i) on the Third Amendment Effective Date, to pay (A) the fees, costs and expenses incurred in connection with the Third Amendment and (B) interest and other amounts accrued under the Bond Debt in an amount not to exceed $2,014,621.03 and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not otherwise prohibited by the terms hereof. Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any December 2016 Additional Term Loan made under the Fourth Amendment on the Fourth Amendment Effective Date for any purpose other than (i) on the Fourth Amendment Effective Date, to pay (A) the fees, costs and expenses incurred in connection with the Fourth Amendment and (B) an aggregate principal amount of loans outstanding under the Revolving Credit Agreement in the amount of $22,000,000 and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not otherwise prohibited by the terms hereof. Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any April 3, 2017 Additional Term Loan made under the Fifth Amendment on the Fifth Amendment Effective Date for any purpose other than (i) on the Fifth Amendment Effective Date, to pay the fees, costs and expenses incurred in connection with the Fifth Amendment and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not
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otherwise prohibited by the terms hereof. Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any April 6, 2017 Additional Term Loan made under the Sixth Amendment on the Sixth Amendment Effective Date for any purpose other than (i) on the Sixth Amendment Effective Date, to pay the fees, costs and expenses incurred in connection with the Sixth Amendment and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not otherwise prohibited by the terms hereof.
(b) Notwithstanding anything to the contrary contained herein, the proceeds of Additional Term Loans which are not used on the Third Amendment Effective Date for the purposes described in the second sentence of Section 6.11(a) , the proceeds of December 2016 Additional Term Loans which are not used on the Fourth Amendment Effective Date for the purposes described in the third sentence of Section 6.11(a) , the proceeds of April 3, 2017 Additional Term Loans which are not used on the Fifth Amendment Effective Date for the purposes described in the fourth sentence of Section 6.11(a) , and the proceeds of April 6, 2017 Additional Term Loans which are not used on the Sixth Amendment Effective Date for the purposes described in the fifth sentence of Section 6.11(a) , shall each be deposited solely into the Master Account and held in such account subject to satisfaction of the Release Conditions. Upon satisfaction of the Release Conditions, Borrower may withdraw funds as set forth in the appropriate Notice of Release Request; provided that, upon release from the Master Account, such released funds may not be used for any purpose other than as set forth in the most recent Rolling Budget delivered to the Lenders pursuant to Section 5.1 .
(c) It is agreed that no part of the proceeds of the loans made to Borrower will be used to purchase or carry any Margin Stock or to extend credit to others for the purpose of purchasing or carrying any Margin Stock or for any purpose that violates the provisions of Regulation T, U or X of the Board of Governors.
(f) Section 8.2(a) thereof shall be amended and restated in its entirety as follows:
(a) fails to perform or observe any covenant or other agreement contained in any of (i) Sections 3.6 , 5.1 , 5.2 , 5.3 (solely if Borrower is not in good standing in its jurisdiction of organization), 5.6 , 5.7 (solely if Borrower refuses to allow Administrative Agent or its representatives or agents to visit Borrowers properties, inspect its assets or books or records, examine and make copies of its books and records, or discuss Borrowers affairs, finances, and accounts with officers and employees of Borrower), 5.10 , 5.11 , 5.13 , 5.14 or 5.17 of this Agreement, (ii) Section 6 of this Agreement, (iii) Section 7 of this Agreement, (iv) Section 7 of the Guaranty and Security Agreement, (v) Section 5 of the Fifth Amendment or (vi) Section 5 of the Sixth Amendment;
3. April 6, 2017 Additional Term Loans .
(a) On the Sixth Amendment Effective Date, each April 6, 2017 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous April 6, 2017 Additional Term Loan to Borrower on the Sixth Amendment Effective Date in an amount not to exceed such April 6, 2017 Additional Term Loan Lenders April 6, 2017 Additional Term Commitment.
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(b) The proceeds of the April 6, 2017 Additional Term Loans shall, to the extent not utilized on the Sixth Amendment Effective Date for the purposes described in clause (i) of the fifth sentence of Section 6.11(a) of the Amended Credit Agreement, be deposited solely into the Master Account and released solely upon satisfaction of the Release Conditions as set forth in the Amended Credit Agreement.
(c) The April 6, 2017 Additional Term Loans shall be Term Loans under the Amended Credit Agreement and shall have the same terms (including with respect to maturity, pricing, prepayments, events of default and assignability) as the Term Loans made under the Existing Credit Agreement.
4. Conditions to Effectiveness of Effective Date Amendments . The amendments set forth in Section 2 shall become effective upon the satisfaction of each of the following conditions precedent, in each case satisfactory to the Administrative Agent in all respects (the Sixth Amendment Effective Date ):
(a) The Administrative Agent shall have received a copy of this Amendment executed and delivered by the Administrative Agent, the Lenders party hereto, and the Loan Parties;
(b) Borrower shall have executed and delivered a letter agreement, in form and substance satisfactory to the Administrative Agent and the Lenders, pertaining to the treatment of the April 6, 2017 Additional Term Loans under that certain Amended and Restated Credit Agreement, dated as of February 3, 2014, by Borrower, Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto;
(c) Borrower shall have executed and delivered amendments, in form and substance satisfactory to the Administrative Agent and each of the Lenders, to each of the Pari Passu Intercreditor Agreement and the Second Lien Intercreditor Agreement, pertaining to this Amendment and the April 6, 2017 Additional Term Loans made hereunder (collectively, the Intercreditor Amendments );
(d) The Collateral Agent shall have received evidence that appropriate financing statements have been duly filed in such office or offices as may be necessary or, in the opinion of any Agent, desirable to perfect the Collateral Agents Liens in and to the Collateral, and Collateral Agent shall have received searches reflecting the filing of all such financing statements;
(e) The Administrative Agent shall have received a certificate from the Secretary of each Loan Party (i) attesting to the resolutions of such Loan Partys board of directors authorizing its execution, delivery, and performance of this Amendment and the other Loan Documents to which it is a party, (ii) authorizing specific officers of such Loan Party to execute the same, and (iii) attesting to the incumbency and signatures of such specific officers of such Loan Party;
(f) The Administrative Agent shall have received confirmation that each Loan Partys Governing Documents have not been amended, supplemented or otherwise modified since the Closing Date;
(g) The Administrative Agent shall have received a certificate of status with respect to each Loan Party, dated prior to the Sixth Amendment Effective Date, such certificate to be
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issued by the appropriate officer of the jurisdiction of organization of such Loan Party, which certificate shall indicate that such Loan Party is in good standing in such jurisdiction;
(h) Each Agent shall have received an opinion of the Loan Parties counsel (including an opinion of counsel in respect of each of such Loan Parties jurisdiction of organization) in form and substance satisfactory to each Agent;
(i) Borrower shall have paid all Lender Group Expenses incurred in connection with the transactions evidenced by this Amendment and the other Loan Documents;
(j) The Administrative Agent shall have received from Borrower, for the benefit of the Lenders party hereto, the Amendment Fee;
(k) Borrower and each of its Subsidiaries shall have received all licenses, approvals or evidence of other actions required by any Governmental Authority in connection with the execution and delivery by Borrower or its Subsidiaries of this Amendment and the other Loan Documents or with the consummation of the transactions contemplated thereby;
(l) After giving effect to this Amendment, no Default or Event of Default shall have occurred and be continuing on the date hereof or as of the Sixth Amendment Effective Date (except as described in clauses (i) through (iii) of Section 6(e) of this Amendment);
(m) The Administrative Agent shall have received a Borrowing request from Borrower in compliance with the provisions of Section 2.3(a) of the Existing Credit Agreement;
(n) Borrower shall have delivered to the Administrative Agent a certificate setting forth the amount held in the Master Account immediately prior to the funding of the April 6, 2017 Additional Term Loans on the Sixth Amendment Effective Date;
(o) Borrower shall confirm that Robert Albergotti has been appointed as the Chief Restructuring Officer of Borrower with the authority customarily associated with such role; and
(p) All corporate and other proceedings, and all documents, instruments and other legal matters in connection with the transactions contemplated by this Amendment shall be satisfactory in form and substance to the Administrative Agent and its counsel.
5. Covenants . Borrower covenants and agrees that, until termination of all of the Commitments and payment in full of the Obligations:
(a) It shall cooperate with the Lenders and exercise its commercially reasonable efforts to enter into a restructuring support agreement and other documentation requested by the Lenders (collectively, the Restructuring Support Agreement ) in connection with the restructuring of the Indebtedness of Borrower and its Subsidiaries, in each case in form and substance satisfactory to Borrower and the Lenders by no later than April 7, 2017;
(b) The appointment of Robert Albergotti as the Chief Restructuring Officer of Borrower shall not be terminated without the prior written consent of each Lender;
(c) Within 5 days of the Sixth Amendment Effective Date (or such later date as the Administrative Agent or the Required Lenders may determine in their sole discretion), Borrower shall cause each Agent to receive an opinion of the Loan Parties counsel (including an opinion of
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counsel in respect of each of such Loan Parties jurisdiction of organization) with respect to the original mortgages for the following states: (i) Louisiana, (ii) Montana, (iii) Ohio and (iv) Texas, in form and substance satisfactory to each Agent;
(d) Within 5 days of the Sixth Amendment Effective Date (or such later date as the Administrative Agent or the Required Lenders may determine in their sole discretion), Borrower shall cause mortgagee title policies to be issued for all of the properties constituting Real Property Collateral under the Amended Credit Agreement in the amount of the fair market value of such properties, containing exceptions reasonably approved by each Agent; and
(e) Within 5 days of the Sixth Amendment Effective Date, Borrower shall pay all title premiums.
6. Representations and Warranties . In order to induce the Agents and Lenders to enter into this Amendment, Borrower hereby represents and warrants to the Agents and Lenders that:
(a) as to each Loan Party, the execution, delivery, and performance by such Loan Party of this Amendment to which it is a party have been duly authorized by all necessary action on the part of such Loan Party;
(b) as to each Loan Party, the execution, delivery, and performance by such Loan Party of this Amendment does not and will not (i) violate any material provision of federal, state, or local law or regulation applicable to any Loan Party or its Subsidiaries, the Governing Documents of any Loan Party or its Subsidiaries, or any order, judgment, or decree of any court or other Governmental Authority binding on any Loan Party or its Subsidiaries, (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material agreement of any Loan Party or its Subsidiaries where any such conflict, breach or default could individually or in the aggregate reasonably be expected to have a Material Adverse Effect, (iii) result in or require the creation or imposition of any Lien of any nature whatsoever upon any assets of any Loan Party, other than Permitted Liens, or (iv) require any approval of any holder of Equity Interests of a Loan Party or any approval or consent of any Person under any material agreement of any Loan Party, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of material agreements, for consents or approvals, the failure to obtain which could not individually or in the aggregate reasonably be expected to cause a Material Adverse Effect;
(c) this Amendment has been duly executed and delivered by each Loan Party that is a party hereto and is the legally valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors rights generally;
(d) after giving effect to this Amendment, except for the representation and warranty set forth in Section 4.9(a) of the Amended Credit Agreement, all representations and warranties contained in the Loan Documents to which Borrower is a party are true, correct and complete in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date of this Amendment, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true, correct and complete in all material respects (except that such materiality qualifier shall not be applicable to any representations and
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warranties that already are qualified or modified by materiality in the text thereof) on and as of such earlier date); and
(e) after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing, except pursuant to:
(i) Section 5.1 of the Amended Credit Agreement with respect to the delivery of a Compliance Certificate for the periods ended December 31, 2016 and February 28, 2017;
(ii) Section 7(a) of the Amended Credit Agreement; and
(iii) Section 8.6 of the Amended Credit Agreement with respect to the Revolving Credit Documents and Events of Default arising under other agreements from the event of default under the Revolving Credit Documents.
7. Amendment Fee . In connection with this Amendment, Borrower agrees to pay to the Agents, for the ratable account of the April 6, 2017 Additional Term Loan Lenders party to this Amendment (such ratable amount based on each such April 6, 2017 Additional Term Loan Lenders April 6, 2017 Additional Term Commitment as a percentage of the April 6, 2017 Additional Term Commitments of all such April 6, 2017 Additional Term Loan Lenders party to this Amendment), an amendment fee (the Amendment Fee ) of $100,000, which fee is due and payable on the Sixth Amendment Effective Date, and fully earned and non-refundable on the Sixth Amendment Effective Date. The Amendment Fee is in addition to and not net of any fees previously paid by Borrower or any Loan Party pursuant to any Loan Document.
8. Consent . The Lenders hereby consent to the sale of the property situated in the Southeast Quarter of the Northwest Quarter of Section 3, Township 1 North, Range 5 East, Sixth Judicial District of Amite County, Mississippi, for the purchase price of $1,500,000.
9. Reference to and Effect on the Amended Credit Agreement and the other Loan Documents .
(a) On and after the Sixth Amendment Effective Date, each reference in the Amended Credit Agreement to this Agreement, hereunder, hereof or words of like import shall mean and be a reference to the Amended Credit Agreement.
(b) The Existing Credit Agreement and each of the other Loan Documents, as specifically amended by this Amendment, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed.
(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 any Lender or the Administrative Agent under any of the Loan Documents, nor constitute a waiver of any provision of any of the Loan Documents. On and after the Sixth Amendment Effective Date, this Amendment shall for all purposes constitute a Loan Document.
10. Acknowledgment; Liens Unimpaired . Each Loan Party hereby acknowledges that it has read this Amendment and consents to its terms, and further hereby affirms, confirms, represents, warrants and agrees that (a) notwithstanding the effectiveness of this Amendment, the obligations of such Loan Party under each of the Loan Documents to which such Loan Party is a party shall not be impaired and each of the Loan Documents to which such Loan Party is a party is, and shall continue to be, in full force
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and effect and is hereby confirmed and ratified in all respects and (b) after giving effect to this Amendment, (i) the execution, delivery, performance or effectiveness of this Amendment shall not impair the validity, effectiveness or priority of the Liens granted pursuant to the Loan Documents and such Liens shall continue unimpaired with the same priority to secure repayment of all Obligations, whether heretofore or hereafter incurred, including, without limitation, the April 6, 2017 Additional Term Loans to be made by the April 6, 2017 Additional Term Loan Lenders on the Sixth Amendment Effective Date, (ii) the Guaranty and Security Agreement, as and to the extent provided in the Loan Documents, shall continue in full force and effect in respect of the Obligations under the Amended Credit Agreement and the other Loan Documents, including, without limitation, the April 6, 2017 Additional Term Loans to be made by the April 6, 2017 Additional Term Loan Lenders on the Sixth Amendment Effective Date, and (iii) each Control Agreement previously delivered by Borrower in connection with the Existing Credit Agreement shall not be impaired and each Control Agreement continues in full force and effect in respect of the Obligations under the Amended Credit Agreement and the other Loan Documents, including, without limitation, the April 6, 2017 Additional Term Loans to be made by the April 6, 2017 Additional Term Loan Lenders on the Sixth Amendment Effective Date. For the avoidance of doubt, each Loan Party hereby acknowledges and affirms that the April 6, 2017 Additional Term Loans made pursuant to this Amendment or the Amended Credit Agreement constitute Obligations (as defined in the Guaranty and Security Agreement) and similar defined terms used in the Loan Documents.
11. Authorization of Administrative Agent . By signing below, the Lenders party hereto (which Lenders constitute the Required Lenders under and as defined in the Existing Credit Agreement) hereby authorize and direct the Administrative Agent to execute and deliver each of (a) this Amendment, (b) the Intercreditor Amendments and (c) each other certificate, filing, agreement or other document relating to this Amendment and the transactions contemplated hereby.
12. Miscellaneous.
(a) Expenses. Borrower agrees to pay on demand all reasonable out-of-pocket costs and expenses of any Agent (including reasonable attorneys fees) incurred in connection with the preparation, negotiation, execution, delivery and administration of this Amendment and all other instruments or documents provided for herein or delivered or to be delivered hereunder or in connection herewith. All obligations provided herein shall survive any termination of this Amendment and the Existing Credit Agreement as amended hereby.
(b) Choice of Law and Venue; Jury Trial Waiver; Reference Provision. Without limiting the applicability of any other provision of the Existing Credit Agreement or any other Loan Document, the terms and provisions set forth in Section 12 of the Existing Credit Agreement are expressly incorporated herein by reference.
(c) Counterparts. This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method of transmission shall be equally effective as delivery of an original executed counterpart of this Agreement.
(d) Severability. Each provision of this Amendment shall be severable from every other provision of this Amendment for the purpose of determining the legal enforceability of any specific provision.
13. Release.
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(a) In consideration of the agreements of the Agents and Lenders contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each of Borrower and each Guarantor that executes this Amendment, on behalf of itself and its successors, assigns, and other legal representatives (Borrower, each Guarantor and all such other Persons being hereinafter referred to collectively as the Releasors and individually as a Releasor ), hereby absolutely, unconditionally and irrevocably releases, remises and forever discharges the Agents, and Lenders, and their successors and assigns, and their present and former shareholders, Affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents and other representatives (Agents, each Lender and all such other Persons being hereinafter referred to collectively as the Releasees and individually as a Releasee ), of and from all demands, actions, causes of action, suits, covenants, contracts, controversies, agreements, promises, sums of money, accounts, bills, reckonings, damages and any and all other claims, counterclaims, defenses, rights of set-off, demands and liabilities whatsoever of every name and nature, known or unknown, suspected or unsuspected, both at law and in equity, which any Releasor may now or hereafter own, hold, have or claim to have against the Releasees or any of them for, upon, or by reason of any circumstance, action, cause or thing whatsoever which arises at any time on or prior to the day and date of this Amendment, in any way related to or in connection with this Amendment, the Existing Credit Agreement, the Amended Credit Agreement, or any of the other Loan Documents or transactions thereunder or related thereto.
(b) Each of Borrower and each Guarantor that executes this Amendment understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.
(c) Each of Borrower and each Guarantor that executes this Amendment agrees that no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter be discovered shall affect in any manner the final, absolute and unconditional nature of the release set forth above.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF , each of the undersigned has caused its duly authorized officer to execute and deliver this Amendment as of the date first written above.
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Executive Vice President, Chief Legal Officer and Corporate Secretary | |
1960 WELL SERVICES, LLC | ||
BADLANDS LEASING, LLC | ||
BADLANDS POWER FUELS, LLC (DE) | ||
BADLANDS POWER FUELS, LLC (ND) | ||
HECKMANN WATER RESOURCES CORPORATION | ||
HECKMANN WATER RESOURCES (CVR), INC. | ||
HECKMANN WOODS CROSS, LLC | ||
HEK WATER SOLUTIONS, LLC | ||
IDEAL OILFIELD DISPOSAL, LLC | ||
LANDTECH ENTERPRISES, L.L.C. | ||
NES WATER SOLUTIONS, LLC | ||
NUVERRA TOTAL SOLUTIONS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President and Secretary | |
APPALACHIAN WATER SERVICES, LLC | ||
By: | HEK Water Solutions, LLC, its managing member | |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President and Secretary |
WILMINGTON SAVINGS FUND SOCIETY , FSB , as Administrative Agent | ||
By: |
/s/ Geoffrey J. Lewis |
|
Name: | Geoffrey J. Lewis | |
Title: | Vice President | |
WELLS FARGO BANK, NATIONAL ASSOCIATION , as Collateral Agent | ||
By: |
/s/ Zachary S. Buchanan |
|
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory |
ASCRIBE II INVESTMENTS LLC , as a Lender | ||
By: |
/s/ Lawrence First |
|
Name: | Lawrence First | |
Title: | Managing Director | |
ASCRIBE III INVESTMENTS LLC , as a Lender | ||
By: |
/s/ Lawrence First |
|
Name: | Lawrence First | |
Title: | Managing Director |
ECF VALUE FUND, LP, as a Lender | ||
By: |
/s/ Jeff Gates |
|
Name: | Jeff Gates | |
Title: | Managing Partner of the General Partner | |
ECF VALUE FUND II, LP , as a Lender | ||
By: |
/s/ Jeff Gates |
|
Name: | Jeff Gates | |
Title: | Managing Partner of the General Partner | |
ECF VALUE FUND INTERNATIONAL MASTER, LP , as a Lender | ||
By: |
/s/ Jeff Gates |
|
Name: | Jeff Gates | |
Title: | President of the Investment Manager |
SCHEDULE 1
GUARANTORS
Subsidiary Guarantor |
Jurisdiction of Formation |
|||
1. |
Nuverra Environmental Solutions, Inc. | Delaware | ||
2. |
1960 Well Services, LLC | Ohio | ||
3. |
Appalachian Water Services, LLC | Pennsylvania | ||
4. |
Badlands Leasing, LLC | North Dakota | ||
5. |
Badlands Power Fuels, LLC | Delaware | ||
6. |
Badlands Power Fuels, LLC | North Dakota | ||
7. |
Heckmann Water Resources Corporation | Texas | ||
8. |
Heckmann Water Resources (CVR), Inc. | Texas | ||
9. |
Heckmann Woods Cross, LLC | Utah | ||
10. |
HEK Water Solutions, LLC | Delaware | ||
11. |
Ideal Oilfield Disposal, LLC | North Dakota | ||
12. |
Landtech Enterprises, L.L.C. | North Dakota | ||
13. |
NES Water Solutions, LLC | Delaware | ||
14. |
Nuverra Total Solutions, LLC | Delaware |
Schedule C-1
Commitments
Lender |
Original Term
Commitment |
Additional
Term Commitment |
December
2016 Additional Term Commitment |
April 3, 2017
Additional Term Commitment |
April 6, 2017
Additional Term Commitment |
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ASCRIBE II INVESTMENTS LLC |
$ | 1,020,000.00 | $ | 280,500.00 | $ | 1,168,750 | $ | 46,750 | $ | 46,750 | ||||||||||
ASCRIBE III INVESTMENTS LLC |
$ | 11,409,600.00 | $ | 3,137,640.00 | $ | 13,073,500 | $ | 522,940 | $ | 522,940 | ||||||||||
ECF VALUE FUND, LP |
$ | 2,731,200.00 | $ | 803,660.00 | $ | 3,173,750 | $ | 131,142 | $ | 131,142 | ||||||||||
ECF VALUE FUND II, LP |
$ | 6,201,600.00 | $ | 1,808,400.00 | $ | 7,171,000 | $ | 313,452 | $ | 313,452 | ||||||||||
ECF VALUE FUND INTERNATIONAL MASTER, LP |
$ | 2,637,600.00 | $ | 569,800.00 | $ | 2,913,000 | $ | 85,716 | $ | 85,716 | ||||||||||
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All Lenders |
$ | 24,000,000.00 | $ | 6,600,000.00 | $ | 27,500,000.00 | $ | 1,100,000.00 | $ | 1,100,000.00 | ||||||||||
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Exhibit A
Notice of Release Request
FORM OF NOTICE OF RELEASE REQUEST
To: | WILMINGTON SAVINGS FUND SOCIETY, FSB, as Administrative Agent |
500 Delaware Avenue
Wilmington, DE 19801
Attention: Corporate Trust
Reference: Nuverra Environmental Solutions, Inc. Term Loan Credit Agreement
Facsimile: 302-421-9137
and
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Collateral Agent
1100 Abernathy Road, Suite 1600
Atlanta, GA 30328
Attn: Account Manager Nuverra
Facsimile: 866-358-0879
Re: | Notice of Release Request dated , 20 |
Ladies and Gentlemen:
Reference is made to that certain Term Loan Credit Agreement dated as of April 15, 2016 (as amended, restated, supplemented, or otherwise modified from time to time, the Credit Agreement) by and among Nuverra Environmental Solutions, Inc., a Delaware corporation, as borrower (Borrower), the lenders party thereto as Lenders (each of such Lenders, together with its successors and permitted assigns, is referred to hereinafter as a Lender), and Wilmington Savings Fund Society, FSB (Wilmington), as administrative agent for each member of the Lender Group (in such capacity, together with its successors and assigns in such capacity, the Administrative Agent). Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement.
The undersigned hereby requests a release of proceeds from the Master Account in the amount of $ to occur on , 2016 (the Release).
In connection with such Release, the undersigned officer of Borrower hereby certifies as of the date hereof that:
1. The proceeds of the Release will be used for the following purpose (which purpose is described in the most recent Rolling Budget delivered under the Credit Agreement, a copy of which is attached as Exhibit A hereto):
[ Insert description ] 1
1 | Purpose must be set forth in the Rolling Budget (which must be in form and substance reasonably satisfactory to the Lenders). |
2. No Event of Default or Default has occurred or is continuing as of the date hereof and as of the date of the requested Release, or would exist after giving effect to the Release on the date thereof.
3. The representations and warranties of Borrower and its Subsidiaries set forth in the Credit Agreement and the other Loan Documents are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date hereof and as of the date of the requested Release (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of such earlier date).
[ signature page follows ]
- 2 -
IN WITNESS WHEREOF, this Notice of Release Request is executed by the undersigned this day of , .
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. a Delaware corporation, as Borrower |
||
By: | ||
Name: | ||
Title: |
|
- 3 -
Exhibit A
Rolling Budget
Exhibit 10.3
SEVENTH AMENDMENT (INCREASE AMENDMENT)
TO
TERM LOAN CREDIT AGREEMENT
THIS SEVENTH AMENDMENT (INCREASE AMENDMENT) TO TERM LOAN CREDIT AGREEMENT (this Amendment ) is entered into as of April 10, 2017, by and among the lenders identified on the signature pages hereof, WILMINGTON SAVINGS FUND SOCIETY, FSB, as administrative agent (in such capacity, Administrative Agent ), WELLS FARGO BANK, NATIONAL ASSOCIATION, as collateral agent (in such capacity, Collateral Agent ), NUVERRA ENVIRONMENTAL SOLUTIONS, INC., a Delaware corporation ( Borrower ), and the entities listed on Schedule 1 ( Guarantors ).
W I T N E S S E T H:
WHEREAS, Borrower, the Administrative Agent and Lenders are parties to that certain Term Loan Credit Agreement, dated as of April 15, 2016 (as amended by that certain First Amendment to Term Loan Credit Agreement, dated as of June 30, 2016, as further amended by that certain Second Amendment to Term Loan Credit Agreement, dated as of September 22, 2016, as further amended by that certain Third Amendment (Increase Amendment) to Term Loan Credit Agreement, dated as of November 14, 2016, as further amended by that certain Fourth Amendment (Increase Amendment) to Term Loan Credit Agreement, dated as of December 16, 2016, as further amended by that certain Fifth Amendment (Increase Amendment) to Term Loan Credit Agreement, dated as of April 3, 2017, and as further amended by that certain Sixth Amendment (Increase Amendment) to Term Loan Credit Agreement, dated as of April 6, 2017, and as amended, restated, modified or supplemented from time to time prior to the date hereof, the Existing Credit Agreement ; the Existing Credit Agreement, as amended by this Amendment and as may be further amended, restated, modified or supplemented from time to time after the date hereof, is herein referred to as the Amended Credit Agreement );
WHEREAS, Borrower has requested that certain Lenders extend April 10, 2017 Additional Term Loans (as defined) to Borrower, and each April 10, 2017 Additional Term Loan Lender (as defined) party hereto has agreed to provide such April 10, 2017 Additional Term Loans to Borrower on the terms and conditions set forth herein and in the Amended Credit Agreement; and
WHEREAS, the Lenders are willing to provide the April 10, 2017 Additional Term Loans to Borrower in order to address Borrowers short-term liquidity needs and to provide sufficient financing to bridge to an agreement on the terms of a long-term solution and consensual restructuring transaction for Borrower;
NOW, THEREFORE, in consideration of the premises and mutual agreements herein contained, the parties hereto agree as follows:
1. Defined Terms . Unless otherwise defined herein, capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Amended Credit Agreement.
2. Amendments to Existing Credit Agreement . In reliance upon the representations and warranties of Borrower set forth in Section 6 below, and subject to the satisfaction of the conditions to effectiveness set forth in Section 4 below, the Existing Credit Agreement is hereby amended as follows:
(a) Schedule 1.1 thereof shall be amended by adding the following definitions in appropriate alphabetical order:
April 10, 2017 Additional Term Commitment means, with respect to each April 10, 2017 Additional Term Loan Lender, its April 10, 2017 Additional Term Commitment, and, with respect to all April 10, 2017 Additional Term Loan Lenders, their April 10, 2017 Additional Term Commitments, in each case as such Dollar amounts are set forth beside such April 10, 2017Additional Term Loan Lenders name under the applicable heading on Schedule C-1 to the Seventh Amendment.
April 10, 2017 Additional Term Loan means the Term Loans made pursuant to the Seventh Amendment.
April 10, 2017 Additional Term Loan Lender means each Lender party to the Seventh Amendment that has an April 10, 2017 Additional Term Commitment.
Restructuring Support Agreement has the meaning set forth in the Seventh Amendment.
Seventh Amendment means the Seventh Amendment (Increase Amendment) to Term Loan Credit Agreement in respect of this Agreement, dated as of April 10, 2017, among Borrower, the Guarantors, party thereto, the Administrative Agent, the Collateral Agent and the Lenders party thereto.
Seventh Amendment Effective Date means April 10, 2017, which is the date on which each of the conditions set forth in Section 4 of the Seventh Amendment has been satisfied and the April 10, 2017 Additional Term Loans have been funded by the April 10, 2017 Additional Term Loan Lenders.
(b) Schedule 1.1 thereof shall be amended by deleting the definitions set forth below in their entirety and replacing them with the following:
Rolling Budget means a projected statement of sources and uses of cash for the Loan Parties and their Subsidiaries on a weekly basis, for the following 13 calendar weeks, including any anticipated use of the proceeds of Additional Term Loans, December 2016 Additional Term Loans, April 3, 2017 Additional Term Loans, April 6, 2017 Additional Term Loans, and/or April 10, 2017 Additional Term Loans held in the Master Account for each week during such period and setting forth on a cumulative roll-forward basis, the projected cash disbursements and projected cash receipts for each applicable week, in form and substance reasonably satisfactory to the Lenders.
Term Commitment means an Original Term Commitment, an Additional Term Commitment, a December 2016 Additional Term Commitment, an April 3, 2017 Additional Term Commitment, an April 6, 2017 Additional Term Commitment, or an April 10, 2017 Additional Term Commitment, or all of them, as the context may require.
Term Loan means an Original Term Loan, an Additional Term Loan, a December 2016 Additional Term Loan, an April 3, 2017 Additional Term Loan, an April 6, 2017 Additional Term Loan, or an April 10 Additional Term Loan, or all of them, as the context may require.
(c) Schedule C-1 thereof shall be amended and restated in its entirety by Schedule C-1 attached to this Amendment.
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(d) Section 2.1(a) thereof shall be amended and restated in its entirety as follows:
(a) Subject to the terms and conditions of this Agreement, each Term Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Closing Date in an amount not to exceed such Lenders Original Term Commitment. Subject to the terms and conditions of this Agreement, each Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Third Amendment Effective Date in an amount not to exceed such Additional Term Loan Lenders Additional Term Commitment. Subject to the terms and conditions of this Agreement, each December 2016 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Fourth Amendment Effective Date in an amount not to exceed such December 2016 Additional Term Loan Lenders December 2016 Additional Term Commitment. Subject to the terms and conditions of this Agreement, each April 3, 2017 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Fifth Amendment Effective Date in an amount not to exceed such April 3, 2017 Additional Term Loan Lenders April 3, 2017 Additional Term Commitment. Subject to the terms and conditions of this Agreement, each April 6, 2017 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Sixth Amendment Effective Date in an amount not to exceed such April 6, 2017 Additional Term Loan Lenders April 6, 2017 Additional Term Commitment. Subject to the terms and conditions of this Agreement, each April 10, 2017 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous loan or loans to Borrower on the Seventh Amendment Effective Date in an amount not to exceed such April 10, 2017 Additional Term Loan Lenders April 10, 2017 Additional Term Commitment.
(e) Section 6.11 thereof shall be amended and restated in its entirety as follows:
6.11 Use of Proceeds .
(a) Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any Original Term Loan made hereunder on the Closing Date for any purpose other than (i) on the Closing Date, to pay the fees, costs, and expenses incurred in connection with this Agreement, the other Loan Documents, and the transactions contemplated hereby and thereby, and (ii) thereafter, consistent with the terms and conditions hereof, for their lawful and permitted purposes (including the repurchase, redemption, prepayment or other acquisition of any Bond Debt). Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any Additional Term Loan made under the Third Amendment on the Third Amendment Effective Date for any purpose other than (i) on the Third Amendment Effective Date, to pay (A) the fees, costs and expenses incurred in connection with the Third Amendment and (B) interest and other amounts accrued under the Bond Debt in an amount not to exceed $2,014,621.03 and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not otherwise prohibited by the terms hereof. Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any December 2016 Additional Term Loan made under the Fourth Amendment on the Fourth Amendment Effective Date for any purpose other than (i) on the Fourth Amendment Effective Date, to pay (A) the fees, costs and expenses incurred in connection with the Fourth Amendment and (B) an aggregate
3
principal amount of loans outstanding under the Revolving Credit Agreement in the amount of $22,000,000 and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not otherwise prohibited by the terms hereof. Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any April 3, 2017 Additional Term Loan made under the Fifth Amendment on the Fifth Amendment Effective Date for any purpose other than (i) on the Fifth Amendment Effective Date, to pay the fees, costs and expenses incurred in connection with the Fifth Amendment and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not otherwise prohibited by the terms hereof. Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any April 6, 2017 Additional Term Loan made under the Sixth Amendment on the Sixth Amendment Effective Date for any purpose other than (i) on the Sixth Amendment Effective Date, to pay the fees, costs and expenses incurred in connection with the Sixth Amendment and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not otherwise prohibited by the terms hereof. Borrower will not, and will not permit any of its Subsidiaries to use the proceeds of any April 10, 2017 Additional Term Loan made under the Seventh Amendment on the Seventh Amendment Effective Date for any purpose other than (i) on the Seventh Amendment Effective Date, to pay (A) the fees, costs and expenses incurred in connection with the Seventh Amendment and the other Loan Documents on or prior to the Seventh Amendment Effective Date and (B) without duplication with clause (A), all fees and expenses of Fried, Frank, Harris, Shriver & Jacobson LLP, as counsel to the Lenders and the Supporting Noteholders (as defined in the Restructuring Support Agreement) on or prior to the Seventh Amendment Effective Date and (ii) thereafter, subject to satisfaction of the Release Conditions and Section 6.11(b) , for general operating, working capital and other general corporate purposes of Borrower not otherwise prohibited by the terms hereof.
(b) Notwithstanding anything to the contrary contained herein, the proceeds of Additional Term Loans which are not used on the Third Amendment Effective Date for the purposes described in the second sentence of Section 6.11(a) , the proceeds of December 2016 Additional Term Loans which are not used on the Fourth Amendment Effective Date for the purposes described in the third sentence of Section 6.11(a) , the proceeds of April 3, 2017 Additional Term Loans which are not used on the Fifth Amendment Effective Date for the purposes described in the fourth sentence of Section 6.11(a) , the proceeds of April 6, 2017 Additional Term Loans which are not used on the Sixth Amendment Effective Date for the purposes described in the fifth sentence of Section 6.11(a) , and the proceeds of April 10, 2017 Additional Term Loans which are not used on the Seventh Amendment Effective Date for the purposes described in the sixth sentence of Section 6.11(a) , shall each be deposited solely into the Master Account and held in such account subject to satisfaction of the Release Conditions. Upon satisfaction of the Release Conditions, Borrower may withdraw funds as set forth in the appropriate Notice of Release Request; provided that, upon release from the Master Account, such released funds may not be used for any purpose other than as set forth in the most recent Rolling Budget delivered to the Lenders pursuant to Section 5.1 .
(c) It is agreed that no part of the proceeds of the loans made to Borrower will be used to purchase or carry any Margin Stock or to extend credit to others for the
4
purpose of purchasing or carrying any Margin Stock or for any purpose that violates the provisions of Regulation T, U or X of the Board of Governors.
(f) Section 8.2(a) thereof shall be amended and restated in its entirety as follows:
(a) fails to perform or observe any covenant or other agreement contained in any of (i) Sections 3.6 , 5.1 , 5.2 , 5.3 (solely if Borrower is not in good standing in its jurisdiction of organization), 5.6 , 5.7 (solely if Borrower refuses to allow Administrative Agent or its representatives or agents to visit Borrowers properties, inspect its assets or books or records, examine and make copies of its books and records, or discuss Borrowers affairs, finances, and accounts with officers and employees of Borrower), 5.10 , 5.11 , 5.13 , 5.14 or 5.17 of this Agreement, (ii) Section 6 of this Agreement, (iii) Section 7 of this Agreement, (iv) Section 7 of the Guaranty and Security Agreement, (v) Section 5 of the Fifth Amendment, (vi) Section 5 of the Sixth Amendment or (vii) Section 5 of the Seventh Amendment;
3. April 10, 2017 Additional Term Loans .
(a) On the Seventh Amendment Effective Date, each April 10, 2017 Additional Term Loan Lender agrees (severally, not jointly or jointly and severally) to make a simultaneous April 10, 2017 Additional Term Loan to Borrower on the Seventh Amendment Effective Date in an amount not to exceed such April 10, 2017Additional Term Loan Lenders April 10, 2017 Additional Term Commitment.
(b) The proceeds of the April 10, 2017 Additional Term Loans shall, to the extent not utilized on the Seventh Amendment Effective Date for the purposes described in clause (i) of the sixth sentence of Section 6.11(a) of the Amended Credit Agreement, be deposited solely into the Master Account and released solely upon satisfaction of the Release Conditions as set forth in the Amended Credit Agreement.
(c) The April 10, 2017 Additional Term Loans shall be Term Loans under the Amended Credit Agreement and shall have the same terms (including with respect to maturity, pricing, prepayments, events of default and assignability) as the Term Loans made under the Existing Credit Agreement. Furthermore, the April 10, 2017 Additional Term Loans shall constitute Supplemental Term Loans (as defined in the Fifth Amendment) and, upon funding of the April 10, 2017 Additional Term Loans, the Lenders have discharged their obligations under Section 8 of the Fifth Amendment.
4. Conditions to Effectiveness of Effective Date Amendments . The amendments set forth in Section 2 shall become effective upon the satisfaction of each of the following conditions precedent, in each case satisfactory to the Administrative Agent in all respects (the Seventh Amendment Effective Date ):
(a) The Administrative Agent shall have received a copy of this Amendment executed and delivered by the Administrative Agent, the Lenders party hereto, and the Loan Parties;
(b) Borrower shall have executed and delivered a letter agreement, in form and substance satisfactory to the Administrative Agent and the Lenders, pertaining to the treatment of the April 10, 2017 Additional Term Loans under that certain Amended and Restated Credit
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Agreement, dated as of February 3, 2014, by Borrower, Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto;
(c) Borrower shall have executed and delivered amendments, in form and substance satisfactory to the Administrative Agent and each of the Lenders, to each of the Pari Passu Intercreditor Agreement and the Second Lien Intercreditor Agreement, pertaining to this Amendment and the April 10, 2017 Additional Term Loans made hereunder (collectively, the Intercreditor Amendments );
(d) The Collateral Agent shall have received evidence that appropriate financing statements have been duly filed in such office or offices as may be necessary or, in the opinion of any Agent, desirable to perfect the Collateral Agents Liens in and to the Collateral, and Collateral Agent shall have received searches reflecting the filing of all such financing statements;
(e) The Administrative Agent shall have received a certificate from the Secretary of each Loan Party (i) attesting to the resolutions of such Loan Partys board of directors authorizing its execution, delivery, and performance of this Amendment and the other Loan Documents to which it is a party, (ii) authorizing specific officers of such Loan Party to execute the same, and (iii) attesting to the incumbency and signatures of such specific officers of such Loan Party;
(f) The Administrative Agent shall have received confirmation that each Loan Partys Governing Documents have not been amended, supplemented or otherwise modified since the Closing Date;
(g) The Administrative Agent shall have received a certificate of status with respect to each Loan Party, dated prior to the Seventh Amendment Effective Date, such certificate to be issued by the appropriate officer of the jurisdiction of organization of such Loan Party, which certificate shall indicate that such Loan Party is in good standing in such jurisdiction;
(h) Each Agent shall have received an opinion of the Loan Parties counsel (including an opinion of counsel in respect of each of such Loan Parties jurisdiction of organization) in form and substance satisfactory to each Agent;
(i) Borrower shall have paid all Lender Group Expenses incurred in connection with the transactions evidenced by this Amendment and the other Loan Documents;
(j) The Administrative Agent shall have received from Borrower, for the benefit of the Lenders party hereto, the Amendment Fee;
(k) Borrower and each of its Subsidiaries shall have received all licenses, approvals or evidence of other actions required by any Governmental Authority in connection with the execution and delivery by Borrower or its Subsidiaries of this Amendment and the other Loan Documents or with the consummation of the transactions contemplated thereby;
(l) After giving effect to this Amendment, no Default or Event of Default shall have occurred and be continuing on the date hereof or as of the Seventh Amendment Effective Date (except as described in clauses (i) through (iii) of Section 6(e) of this Amendment);
(m) The Administrative Agent shall have received a Borrowing request from Borrower in compliance with the provisions of Section 2.3(a) of the Existing Credit Agreement;
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(n) Borrower shall have delivered to the Administrative Agent a certificate setting forth the amount held in the Master Account immediately prior to the funding of the April 10, 2017 Additional Term Loans on the Seventh Amendment Effective Date;
(o) Borrower shall confirm that Robert Albergotti has been appointed as the Chief Restructuring Officer of Borrower with the authority customarily associated with such role; and
(p) All corporate and other proceedings, and all documents, instruments and other legal matters in connection with the transactions contemplated by this Amendment shall be satisfactory in form and substance to the Administrative Agent and its counsel.
5. Covenants . Borrower covenants and agrees that, until termination of all of the Commitments and payment in full of the Obligations:
(a) It shall comply with the terms and conditions of the Restructuring Support Agreement (the Restructuring Support Agreement ), dated April 10, 2017, by and among Borrower, the Guarantors party thereto, and the holders of the 2016 Bonds, in all respects, except as otherwise agreed to by the Lenders;
(b) The appointment of Robert Albergotti as the Chief Restructuring Officer of Borrower shall not be terminated without the prior written consent of each Lender;
(c) Within 5 days of the Seventh Amendment Effective Date (or such later date as the Administrative Agent or the Required Lenders may determine in their sole discretion), Borrower shall cause each Agent to receive an opinion of the Loan Parties counsel (including an opinion of counsel in respect of each of such Loan Parties jurisdiction of organization) with respect to the original mortgages for the following states: (i) Louisiana, (ii) Montana, (iii) Ohio and (iv) Texas, in form and substance satisfactory to each Agent;
(d) Within 5 days of the Seventh Amendment Effective Date (or such later date as the Administrative Agent or the Required Lenders may determine in their sole discretion), Borrower shall cause mortgagee title policies to be issued for all of the properties constituting Real Property Collateral under the Amended Credit Agreement in the amount of the fair market value of such properties, containing exceptions reasonably approved by each Agent; and
(e) Within 5 days of the Seventh Amendment Effective Date, Borrower shall pay all title premiums.
6. Representations and Warranties . In order to induce the Agents and Lenders to enter into this Amendment, Borrower hereby represents and warrants to the Agents and Lenders that:
(a) as to each Loan Party, the execution, delivery, and performance by such Loan Party of this Amendment to which it is a party have been duly authorized by all necessary action on the part of such Loan Party;
(b) as to each Loan Party, the execution, delivery, and performance by such Loan Party of this Amendment does not and will not (i) violate any material provision of federal, state, or local law or regulation applicable to any Loan Party or its Subsidiaries, the Governing Documents of any Loan Party or its Subsidiaries, or any order, judgment, or decree of any court or other Governmental Authority binding on any Loan Party or its Subsidiaries, (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any
7
material agreement of any Loan Party or its Subsidiaries where any such conflict, breach or default could individually or in the aggregate reasonably be expected to have a Material Adverse Effect, (iii) result in or require the creation or imposition of any Lien of any nature whatsoever upon any assets of any Loan Party, other than Permitted Liens, or (iv) require any approval of any holder of Equity Interests of a Loan Party or any approval or consent of any Person under any material agreement of any Loan Party, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of material agreements, for consents or approvals, the failure to obtain which could not individually or in the aggregate reasonably be expected to cause a Material Adverse Effect;
(c) this Amendment has been duly executed and delivered by each Loan Party that is a party hereto and is the legally valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors rights generally;
(d) after giving effect to this Amendment, except for the representation and warranty set forth in Section 4.9(a) of the Amended Credit Agreement, all representations and warranties contained in the Loan Documents to which Borrower is a party are true, correct and complete in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date of this Amendment, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true, correct and complete in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of such earlier date); and
(e) after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing, except pursuant to:
(i) Section 5.1 of the Amended Credit Agreement with respect to the delivery of a Compliance Certificate for the periods ended December 31, 2016 and February 28, 2017;
(ii) Section 7(a) of the Amended Credit Agreement; and
(iii) Section 8.6 of the Amended Credit Agreement with respect to the Revolving Credit Documents and Events of Default arising under other agreements from the event of default under the Revolving Credit Documents.
7. Amendment Fee . In connection with this Amendment, Borrower agrees to pay to the Agents, for the ratable account of the April 10, 2017 Additional Term Loan Lenders party to this Amendment (such ratable amount based on each such April 10, 2017 Additional Term Loan Lenders April 10, 2017 Additional Term Commitment as a percentage of the April 10, 2017 Additional Term Commitments of all such April 10, 2017 Additional Term Loan Lenders party to this Amendment), an amendment fee (the Amendment Fee ) of $500,000, which fee is due and payable on the Seventh Amendment Effective Date, and fully earned and non-refundable on the Seventh Amendment Effective Date. The Amendment Fee is in addition to and not net of any fees previously paid by Borrower or any Loan Party pursuant to any Loan Document.
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8. Reference to and Effect on the Amended Credit Agreement and the other Loan Documents .
(a) On and after the Seventh Amendment Effective Date, each reference in the Amended Credit Agreement to this Agreement, hereunder, hereof or words of like import shall mean and be a reference to the Amended Credit Agreement.
(b) The Existing Credit Agreement and each of the other Loan Documents, as specifically amended by this Amendment, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed.
(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 any Lender or the Administrative Agent under any of the Loan Documents, nor constitute a waiver of any provision of any of the Loan Documents. On and after the Seventh Amendment Effective Date, this Amendment shall for all purposes constitute a Loan Document.
9. Acknowledgment; Liens Unimpaired . Each Loan Party hereby acknowledges that it has read this Amendment and consents to its terms, and further hereby affirms, confirms, represents, warrants and agrees that (a) notwithstanding the effectiveness of this Amendment, the obligations of such Loan Party under each of the Loan Documents to which such Loan Party is a party shall not be impaired and each of the Loan Documents to which such Loan Party is a party is, and shall continue to be, in full force and effect and is hereby confirmed and ratified in all respects and (b) after giving effect to this Amendment, (i) the execution, delivery, performance or effectiveness of this Amendment shall not impair the validity, effectiveness or priority of the Liens granted pursuant to the Loan Documents and such Liens shall continue unimpaired with the same priority to secure repayment of all Obligations, whether heretofore or hereafter incurred, including, without limitation, the April 10, 2017 Additional Term Loans to be made by the April 10, 2017 Additional Term Loan Lenders on the Seventh Amendment Effective Date, (ii) the Guaranty and Security Agreement, as and to the extent provided in the Loan Documents, shall continue in full force and effect in respect of the Obligations under the Amended Credit Agreement and the other Loan Documents, including, without limitation, the April 10, 2017 Additional Term Loans to be made by the April 10, 2017 Additional Term Loan Lenders on the Seventh Amendment Effective Date, and (iii) each Control Agreement previously delivered by Borrower in connection with the Existing Credit Agreement shall not be impaired and each Control Agreement continues in full force and effect in respect of the Obligations under the Amended Credit Agreement and the other Loan Documents, including, without limitation, the April 10, 2017 Additional Term Loans to be made by the April 10, 2017 Additional Term Loan Lenders on the Seventh Amendment Effective Date. For the avoidance of doubt, each Loan Party hereby acknowledges and affirms that the April 10, 2017 Additional Term Loans made pursuant to this Amendment or the Amended Credit Agreement constitute Obligations (as defined in the Guaranty and Security Agreement) and similar defined terms used in the Loan Documents.
10. Authorization of Administrative Agent . By signing below, the Lenders party hereto (which Lenders constitute the Required Lenders under and as defined in the Existing Credit Agreement) hereby authorize and direct the Administrative Agent to execute and deliver each of (a) this Amendment, (b) the Intercreditor Amendments and (c) each other certificate, filing, agreement or other document relating to this Amendment and the transactions contemplated hereby.
11. Miscellaneous.
(a) Expenses. Borrower agrees to pay on demand all reasonable out-of-pocket costs and expenses of any Agent (including reasonable attorneys fees) incurred in connection with the preparation,
9
negotiation, execution, delivery and administration of this Amendment and all other instruments or documents provided for herein or delivered or to be delivered hereunder or in connection herewith. All obligations provided herein shall survive any termination of this Amendment and the Existing Credit Agreement as amended hereby.
(b) Choice of Law and Venue; Jury Trial Waiver; Reference Provision. Without limiting the applicability of any other provision of the Existing Credit Agreement or any other Loan Document, the terms and provisions set forth in Section 12 of the Existing Credit Agreement are expressly incorporated herein by reference.
(c) Counterparts. This Amendment may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Amendment. Delivery of an executed counterpart of this Amendment by telefacsimile or other electronic method of transmission shall be equally effective as delivery of an original executed counterpart of this Agreement.
(d) Severability. Each provision of this Amendment shall be severable from every other provision of this Amendment for the purpose of determining the legal enforceability of any specific provision.
12. Release.
(a) In consideration of the agreements of the Agents and Lenders contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each of Borrower and each Guarantor that executes this Amendment, on behalf of itself and its successors, assigns, and other legal representatives (Borrower, each Guarantor and all such other Persons being hereinafter referred to collectively as the Releasors and individually as a Releasor ), hereby absolutely, unconditionally and irrevocably releases, remises and forever discharges the Agents, and Lenders, and their successors and assigns, and their present and former shareholders, Affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents and other representatives (Agents, each Lender and all such other Persons being hereinafter referred to collectively as the Releasees and individually as a Releasee ), of and from all demands, actions, causes of action, suits, covenants, contracts, controversies, agreements, promises, sums of money, accounts, bills, reckonings, damages and any and all other claims, counterclaims, defenses, rights of set-off, demands and liabilities whatsoever of every name and nature, known or unknown, suspected or unsuspected, both at law and in equity, which any Releasor may now or hereafter own, hold, have or claim to have against the Releasees or any of them for, upon, or by reason of any circumstance, action, cause or thing whatsoever which arises at any time on or prior to the day and date of this Amendment, in any way related to or in connection with this Amendment, the Existing Credit Agreement, the Amended Credit Agreement, or any of the other Loan Documents or transactions thereunder or related thereto.
(b) Each of Borrower and each Guarantor that executes this Amendment understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.
(c) Each of Borrower and each Guarantor that executes this Amendment agrees that no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter be
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discovered shall affect in any manner the final, absolute and unconditional nature of the release set forth above.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF , each of the undersigned has caused its duly authorized officer to execute and deliver this Amendment as of the date first written above.
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Executive Vice President, Chief Legal Officer and Corporate Secretary | |
1960 WELL SERVICES, LLC | ||
BADLANDS LEASING, LLC | ||
BADLANDS POWER FUELS, LLC (DE) | ||
BADLANDS POWER FUELS, LLC (ND) | ||
HECKMANN WATER RESOURCES CORPORATION | ||
HECKMANN WATER RESOURCES (CVR), INC. | ||
HECKMANN WOODS CROSS, LLC | ||
HEK WATER SOLUTIONS, LLC | ||
IDEAL OILFIELD DISPOSAL, LLC | ||
LANDTECH ENTERPRISES, L.L.C. | ||
NES WATER SOLUTIONS, LLC | ||
NUVERRA TOTAL SOLUTIONS, LLC | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President and Secretary | |
APPALACHIAN WATER SERVICES, LLC | ||
By: | HEK Water Solutions, LLC, its managing member | |
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Vice President and Secretary |
WILMINGTON SAVINGS FUND SOCIETY, FSB , as Administrative Agent | ||
By: |
/s/ Geoffrey J. Lewis |
|
Name: | Geoffrey J. Lewis | |
Title: | Vice President | |
WELLS FARGO BANK, NATIONAL ASSOCIATION , as Collateral Agent |
||
By: |
/s/ Zachary S. Buchanan |
|
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory |
ASCRIBE II INVESTMENTS LLC , as a Lender | ||
By: |
/s/ Lawrence First |
|
Name: | Lawrence First | |
Title: | Managing Director | |
ASCRIBE III INVESTMENTS LLC , as a Lender | ||
By: |
/s/ Lawrence First |
|
Name: | Lawrence First | |
Title: | Managing Director |
ECF VALUE FUND, LP , as a Lender | ||
By: |
/s/ Jeff Gates |
|
Name: | Jeff Gates | |
Title: | Managing Partner of the General Partner | |
ECF VALUE FUND II, LP , as a Lender | ||
By: |
/s/ Jeff Gates |
|
Name: | Jeff Gates | |
Title: | Managing Partner of the General Partner | |
ECF VALUE FUND INTERNATIONAL MASTER, LP , as a Lender | ||
By: |
/s/ Jeff Gates |
|
Name: | Jeff Gates | |
Title: | President of the Investment Manager |
SCHEDULE 1
GUARANTORS
Subsidiary Guarantor |
Jurisdiction of Formation |
|||
1. | Nuverra Environmental Solutions, Inc. | Delaware | ||
2. | 1960 Well Services, LLC | Ohio | ||
3. | Appalachian Water Services, LLC | Pennsylvania | ||
4. | Badlands Leasing, LLC | North Dakota | ||
5. | Badlands Power Fuels, LLC | Delaware | ||
6. | Badlands Power Fuels, LLC | North Dakota | ||
7. | Heckmann Water Resources Corporation | Texas | ||
8. | Heckmann Water Resources (CVR), Inc. | Texas | ||
9. | Heckmann Woods Cross, LLC | Utah | ||
10. | HEK Water Solutions, LLC | Delaware | ||
11. | Ideal Oilfield Disposal, LLC | North Dakota | ||
12. | Landtech Enterprises, L.L.C. | North Dakota | ||
13. | NES Water Solutions, LLC | Delaware | ||
14. | Nuverra Total Solutions, LLC | Delaware |
Schedule C-1
Commitments
Lender |
Original Term
Commitment |
Additional
Term Commitment |
December
2016 Additional Term Commitment |
April 3, 2017
Additional Term Commitment |
April 6, 2017
Additional Term Commitment |
April 10,
2017 Additional Term Commitment |
||||||||||||||||||
ASCRIBE II INVESTMENTS LLC |
$ | 1,020,000.00 | $ | 280,500.00 | $ | 1,168,750 | $ | 46,750 | $ | 46,750 | $ | 233,750 | ||||||||||||
ASCRIBE III INVESTMENTS LLC |
$ | 11,409,600.00 | $ | 3,137,640.00 | $ | 13,073,500 | $ | 522,940 | $ | 522,940 | $ | 2,614,700 | ||||||||||||
ECF VALUE FUND, LP |
$ | 2,731,200.00 | $ | 803,660.00 | $ | 3,173,750 | $ | 131,142 | $ | 131,142 | $ | 655,710 | ||||||||||||
ECF VALUE FUND II, LP |
$ | 6,201,600.00 | $ | 1,808,400.00 | $ | 7,171,000 | $ | 313,452 | $ | 313,452 | $ | 1,567,260 | ||||||||||||
ECF VALUE FUND INTERNATIONAL MASTER, LP |
$ | 2,637,600.00 | $ | 569,800.00 | $ | 2,913,000 | $ | 85,716 | $ | 85,716 | $ | 428,580 | ||||||||||||
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All Lenders |
$ | 24,000,000.00 | $ | 6,600,000.00 | $ | 27,500,000.00 | $ | 1,100,000.00 | $ | 1,100,000.00 | $ | 5,500,000.00 | ||||||||||||
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- 2 -
Exhibit A
Notice of Release Request
FORM OF NOTICE OF RELEASE REQUEST
To: | WILMINGTON SAVINGS FUND SOCIETY, FSB, as Administrative Agent |
500 Delaware Avenue
Wilmington, DE 19801
Attention: Corporate Trust
Reference: Nuverra Environmental Solutions, Inc. Term Loan Credit Agreement
Facsimile: 302-421-9137
and
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Collateral Agent
1100 Abernathy Road, Suite 1600
Atlanta, GA 30328
Attn: Account Manager Nuverra
Facsimile: 866-358-0879
Re: | Notice of Release Request dated , 20 |
Ladies and Gentlemen:
Reference is made to that certain Term Loan Credit Agreement dated as of April 15, 2016 (as amended, restated, supplemented, or otherwise modified from time to time, the Credit Agreement ) by and among Nuverra Environmental Solutions, Inc., a Delaware corporation, as borrower ( Borrower ), the lenders party thereto as Lenders (each of such Lenders, together with its successors and permitted assigns, is referred to hereinafter as a Lender ), and Wilmington Savings Fund Society, FSB ( Wilmington ), as administrative agent for each member of the Lender Group (in such capacity, together with its successors and assigns in such capacity, the Administrative Agent ). Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement.
The undersigned hereby requests a release of proceeds from the Master Account in the amount of $ to occur on , 2016 (the Release ).
In connection with such Release, the undersigned officer of Borrower hereby certifies as of the date hereof that:
1. The proceeds of the Release will be used for the following purpose (which purpose is described in the most recent Rolling Budget delivered under the Credit Agreement, a copy of which is attached as Exhibit A hereto):
[ Insert description ] 1
1 | Purpose must be set forth in the Rolling Budget (which must be in form and substance reasonably satisfactory to the Lenders). |
2. No Event of Default or Default has occurred or is continuing as of the date hereof and as of the date of the requested Release, or would exist after giving effect to the Release on the date thereof.
3. The representations and warranties of Borrower and its Subsidiaries set forth in the Credit Agreement and the other Loan Documents are true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date hereof and as of the date of the requested Release (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of such earlier date).
[ signature page follows ]
- 2 -
IN WITNESS WHEREOF, this Notice of Release Request is executed by the undersigned this day of , .
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. a Delaware corporation, as Borrower |
By: |
|
|
Name: |
|
|
Title: |
|
- 3 -
Exhibit A
Rolling Budget
Exhibit 10.4
April 6, 2017
ASCRIBE II INVESTMENTS LLC
ASCRIBE III INVESTMENTS LLC
ECF VALUE FUND, LP
ECF VALUE FUND II, LP
ECF VALUE FUND INTERNATIONAL MASTER, LP
Re: | Sixth Amendment (Increase Amendment) to Term Loan Credit Agreement |
Ladies and Gentlemen:
Reference is made to that certain Amended and Restated Credit Agreement dated as of February 3, 2014 (as amended, restated, modified or supplemented from time to time, the Credit Agreement ) by and among Wells Fargo Bank, National Association, as agent ( Agent ) for the Lenders (as defined in the Credit Agreement) (the Lenders ), and Nuverra Environmental Solutions, Inc., a Delaware corporation ( Borrower ).
Reference is also made to the Sixth Amendment (Increase Amount) to Term Loan Credit Agreement (the Sixth Amendment ), dated as of the date hereof, by and among Wilmington Savings Fund Society, FSB, as Administrative Agent, Wells Fargo Bank, National Association, as Collateral Agent, Borrower, certain affiliates of Borrower as guarantors, and the addressees of this letter as lenders (the Term Lenders ). Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to such terms in the Sixth Amendment or the Existing Credit Agreement (as defined in the Sixth Amendment).
Agent and Lenders hereby agree not to exercise any remedies with respect to the cash proceeds of the April 6, 2017 Additional Term Loans that are deposited in the Master Account (the Additional Term Loan Proceeds ), including but not limited to exercising rights of setoff or exerting control over such Additional Term Loan Proceeds pursuant any Control Agreement unless (i) the administrative agent for the Additional Term Loan Debt (the Term Loan Agent ) consents to such exercise of remedies or (ii) such Additional Term Loan Proceeds are turned over to Term Loan Agent for application to the Obligations under the Existing Credit Agreement in accordance with the paragraph below.
In the event that Agent and/or Lenders foreclose on or otherwise obtain direct control over the Additional Term Loan Proceeds, such Additional Term Loan Proceeds shall be deemed to be held in trust by the Agent, Lenders or other custodian of such funds (as applicable) for the benefit solely of the Term Lenders that funded the April 6, 2017 Additional Term Loans (the Additional Term Loan Debt ), and such Additional Term Loan Proceeds shall be turned over to Term Loan Agent on demand and in the form received for distribution by Term Loan Agent to the Term Lenders that funded the Additional Term Loan Debt. For the avoidance of doubt, as between the Term Lenders
that funded the Additional Term Loan Debt and the Agent, this letter agreement shall constitute a subordination agreement among lenders for purposes of applying 11 U.S.C. § 510(a).
[signature page follows]
-2-
Sincerely, | ||
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Agent | ||
By: |
/s/ Zachary S. Buchanan |
|
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory |
Acknowledged and Accepted this 6th day of April, 2017 | ||
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Executive Vice President |
-3-
Exhibit 10.5
April 10, 2017
ASCRIBE II INVESTMENTS LLC
ASCRIBE III INVESTMENTS LLC
ECF VALUE FUND, LP
ECF VALUE FUND II, LP
ECF VALUE FUND INTERNATIONAL MASTER, LP
Re: | Seventh Amendment (Increase Amendment) to Term Loan Credit Agreement |
Ladies and Gentlemen:
Reference is made to that certain Amended and Restated Credit Agreement dated as of February 3, 2014 (as amended, restated, modified or supplemented from time to time, the Credit Agreement ) by and among Wells Fargo Bank, National Association, as agent ( Agent ) for the Lenders (as defined in the Credit Agreement) (the Lenders ), and Nuverra Environmental Solutions, Inc., a Delaware corporation ( Borrower ).
Reference is also made to the Seventh Amendment (Increase Amount) to Term Loan Credit Agreement (the Seventh Amendment ), dated as of the date hereof, by and among Wilmington Savings Fund Society, FSB, as Administrative Agent, Wells Fargo Bank, National Association, as Collateral Agent, Borrower, certain affiliates of Borrower as guarantors, and the addressees of this letter as lenders (the Term Lenders ). Unless otherwise defined herein, capitalized terms used herein shall have the meanings ascribed to such terms in the Seventh Amendment or the Existing Credit Agreement (as defined in the Seventh Amendment).
Agent and Lenders hereby agree not to exercise any remedies with respect to the cash proceeds of the April 10, 2017 Additional Term Loans that are deposited in the Master Account (the Additional Term Loan Proceeds ), including but not limited to exercising rights of setoff or exerting control over such Additional Term Loan Proceeds pursuant any Control Agreement unless (i) the administrative agent for the Additional Term Loan Debt (the Term Loan Agent ) consents to such exercise of remedies or (ii) such Additional Term Loan Proceeds are turned over to Term Loan Agent for application to the Obligations under the Existing Credit Agreement in accordance with the paragraph below.
In the event that Agent and/or Lenders foreclose on or otherwise obtain direct control over the Additional Term Loan Proceeds, such Additional Term Loan Proceeds shall be deemed to be held in trust by the Agent, Lenders or other custodian of such funds (as applicable) for the benefit solely of the Term Lenders that funded the April 10, 2017 Additional Term Loans (the Additional Term Loan Debt ), and such Additional Term Loan Proceeds shall be turned over to Term Loan Agent on demand and in the form received for distribution by Term Loan Agent to the Term Lenders that
funded the Additional Term Loan Debt. For the avoidance of doubt, as between the Term Lenders that funded the Additional Term Loan Debt and the Agent, this letter agreement shall constitute a subordination agreement among lenders for purposes of applying 11 U.S.C. § 510(a).
[signature page follows]
-2-
Sincerely, | ||
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Agent | ||
By: |
/s/ Zachary S. Buchanan |
|
Name: | Zachary S. Buchanan | |
Title: | Authorized Signatory |
Acknowledged and Accepted this | ||
10th day of April, 2017 | ||
NUVERRA ENVIRONMENTAL SOLUTIONS, INC. | ||
By: |
/s/ Joseph M. Crabb |
|
Name: | Joseph M. Crabb | |
Title: | Executive Vice President |
-3-
Exhibit 99.1
NUVERRA ENTERS INTO RESTRUCTURING SUPPORT AGREEMENT WITH NOTEHOLDERS HOLDING MORE THAN $365 MILLION IN SECURED DEBT;
COMPANY TO COMPLETE COMPREHENSIVE RECAPITALIZATION IN COURT;
RSA PROVIDES FOR OPERATIONS TO CONTINUE AS USUAL, WITHOUT INTERRUPTION, WITH EMPLOYEES, VENDORS AND TRADE CREDITORS TO BE PAID IN FULL IN THE ORDINARY COURSE OF BUSINESS
SCOTTSDALE, Ariz. (April 12, 2017) Nuverra Environmental Solutions, Inc. (Nuverra or the Company) (OTCQB: NESC) announced today that it has entered into a Restructuring Support Agreement (RSA or the agreement) with the holders of more than 80% of the Companys outstanding 12.50%/10.0% Senior Secured Second Lien Notes due 2021 (the 2021 Notes) to complete a comprehensive recapitalization of the Company that will significantly deleverage the Companys balance sheet, improve liquidity and support operations while the energy market recovers from the prolonged depression of oil and natural gas prices. The agreement provides that the recapitalization will be completed pursuant to a proposed prepackaged plan of reorganization (the Plan) through the filing of a chapter 11 restructuring (the Restructuring) on or before Monday, April 24, 2017. The Company expects to commence a solicitation of votes for the Plan no later than Thursday, April 20, 2017. All obligations and commitments under the RSA are subject to the terms and conditions provided therein.
Prior to the Companys commencement of the Restructuring, business operations will continue uninterrupted and additional working capital will be provided by the Companys term lenders.
Similarly, operations are expected to continue as usual and without interruption after the Company commences the Restructuring and throughout the in-court process. Additional liquidity, in the form of debtor-in-possession financing, is expected to be available during the Restructuring process to maintain operations. As a result, the Company anticipates that there will be no change in Nuverras ability to meet its customer needs, and customer agreements will remain in effect. Under the contemplated Plan, the Companys vendors and trade creditors will be paid in full in the ordinary course of business. In addition, employees will be paid as usual and continue to receive benefits before and after the filings, pending customary court approvals.
The Company has been immersed in an ongoing process with lenders and noteholders to create a capital structure that its business can support while the energy market recovers from the prolonged depression in oil and natural gas prices. A significant part of that process is rightsizing Nuverras overall debt. The Board of Directors has determined that the best course of action at this time is an in-court, prepackaged plan of reorganization that will allow the Company to reduce its debt and obtain new financing so that the Company can continue to provide excellent service to its customers. The Company plans to complete this process quickly and without interruption to business operations. The Company expects to exit the restructuring process with a significant reduction in net debt.
Significant elements of the Plan as contemplated by the RSA and subject to the terms and conditions of the RSA include:
1
| Debtor-in-possession financing provided by the lenders under the Companys asset-based lending facility and/or term loan; |
| Payment in full of all administrative expense claims, priority tax claims, priority claims and asset-based lending facility claims; |
| Payment in full of all undisputed customer, vendor or other trade obligations; |
| Conversion of $75 million in term loan claims into newly issued common stock; |
| Conversion of 2021 Notes into newly issued common stock and rights in the rights offering; |
| Cancellation of the Companys 9.875% Senior Notes due 2018 and existing common stock; |
| A rights offering provided to the holders of the 2021 Notes, and, under certain conditions, the 2018 Notes and existing common stock to acquire, in the aggregate, $150 million of new common stock of the reorganized Company; |
| Exit financing, to the extent necessary; and |
| Company to emerge with significantly reduced debt. |
The Company also announced today that it has retained Robert D. Albergotti of AP Services, LLC (and a Managing Director of AlixPartners, LLP), as Chief Restructuring Officer. Mr. Albergotti is responsible for the oversight and implementation of the Companys restructuring efforts and will report directly to the Companys board of directors. Mr. Albergotti brings to the Company expertise in the development and implementation of complex restructuring solutions to maximize value for all stakeholders, including expertise managing restructurings in chapter 11 cases.
The Companys legal advisors include Shearman & Sterling LLP, Squire Patton Boggs (US) LLP and Young Conaway Stargatt and Taylor LLP. The Companys financial advisor is Lazard Middle Market, LLC.
More information can be found in the Companys Form 8-K being filed with the Securities and Exchange Commission today.
About Nuverra
Nuverra Environmental Solutions, Inc. is among the largest companies in the United States dedicated to providing comprehensive, full-cycle environmental solutions to customers focused on the development and ongoing production of oil and natural gas from shale formations. Our strategy is to provide one-stop, total environmental solutions and wellsite logistics management, including delivery, collection, treatment, recycling, and disposal of solid and liquid materials that are used in and generated by the drilling, completion, and ongoing production of shale oil and natural gas. The Company provides its suite of environmentally compliant and sustainable solutions to customers who demand stricter environmental compliance and accountability from their service providers. Find additional information about Nuverra on the Companys website, http://www.nuverra.com, and in documents filed with the U.S. Securities and Exchange Commission (SEC) at http://www.sec.gov.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the United States Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the United States Securities Exchange Act of 1934, as amended, or the Exchange Act. These statements relate to our expectations for future events and time periods. All statements other than statements of historical fact are statements that could be deemed to be forward-looking statements, including, but not limited to, statements regarding our ability to
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continue our operations without interruption prior to and throughout the chapter 11 proceeding, meet the needs of our employees, customers, and vendors, and successfully consummate the restructuring transactions. Any forward-looking statements contained herein are based on information available to us as of the date of this press release and our current expectations, forecasts and assumptions, and involve a number of risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date. Future performance cannot be ensured, and actual results may differ materially from those in the forward-looking statements. Some factors that could cause actual results to differ include, among others: the current default under our asset-based revolving credit facility and related cross-defaults under our other documents governing our indebtedness; difficulties encountered in restructuring our debt in the bankruptcy proceeding; risks of successfully consummating restructuring within the timeframes or on the terms contemplated; the ability to successfully consummate the bankruptcy proceeding; the potential that our debtholders can accelerate and foreclose pursuant to our debt obligations at any time; the ability to make the scheduled interest payments under the agreements governing our debt obligations, including the upcoming interest payments on our notes; potential impact of litigation; uncertainty relating to successful negotiation, execution and consummation of all necessary definitive agreements in connection with our strategic initiatives; whether certain markets grow as anticipated; pricing pressures; current and projected future uncertainties in commodities markets, including low oil and/or natural gas prices; changes in customer drilling and completion activities and capital expenditure plans; shifts in production in shale areas where we operate and/or shale areas where we currently do not have operations; control of costs and expenses, including uncertainty regarding the ability to successfully implement cost-management initiatives; liquidity and access to capital; compliance with the terms of agreements governing our indebtedness; and the competitive and regulatory environment. The forward-looking statements contained, or incorporated by reference, herein are also subject generally to other risks and uncertainties that are described from time to time in the Companys filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect managements views as of the date of this press release. The Company undertakes no obligation to update any such forward-looking statements, whether as a result of new information, future events, changes in expectations or otherwise. Additional risks and uncertainties are disclosed from time to time in the Companys filings with the SEC, including the Annual Report on Form 10-K for the fiscal year ended December 31, 2016, as well as Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Source: Nuverra Environmental Solutions, Inc.
Abernathy MacGregor
Sydney Isaacs, sri@abmac.com , 713.999.5104
Rivian Bell, rlb@abmac.com , 213.630.6550
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