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): May 10, 2005
NATURAL GAS SERVICES GROUP, INC.
(Exact Name of Registrant as Specified in Its Charter)
Colorado 1-31398 75-2811855
(State or other jurisdiction (Commission File (IRS Employer
of Incorporation or organization) Number) Identification No.)
2911 South County Road 1260 Midland, Texas 79706
(Address of Principal Executive Offices) (Zip Code)
432-563-3974
(Registrant's telephone number, including area code)
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 obligation of the registrant under any of the
following provisions:
[_] 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.
On May 10, 2005, Natural Gas Services Group, Inc., as borrower, and
Western National Bank, as lender, entered into a First Modification to Fourth
Amended and Restated Loan Agreement, dated effective as of May 1, 2005 (the
"Loan Modification Agreement"). The Loan Modification Agreement amends the
"Consolidated Current Ratio" definition in the Fourth Amended and Restated Loan
Agreement, dated March 14, 2005 (the "Loan Agreement"), between Natural Gas and
Western National Bank, by expanding the assets considered in the calculation of
such ratio to include restricted cash held by Natural Gas. In addition, under
the Loan Modification Agreement, we are required to maintain a Consolidated
Current Ratio of 1.4 to 1.00 from month to month, versus 1.5 to 1.00 as
originally required under the Loan Agreement.
As previously reported, the indebtedness extended to Natural Gas by
Western National Bank under the Loan Agreement is evidenced by the following
promissory notes (collectively, the "Notes"):
(1) Multiple Advance Term Promissory Note, dated March 14, 2005, in the
original principal amount of $1,500,000.00, payable by Natural Gas
Services Group, Inc. to the order of Western National Bank, bearing
interest at a current annual rate of 7.00%and maturing on April 1, 2010
(the "$1,500,000.00 Multiple Advance Term Note");
(2) Multiple Advance Term Promissory Note, dated March 14, 2005, in the
original principal amount of $10,000,000.00, payable by Natural Gas
Services Group, Inc. to the order of Western National Bank, bearing
interest at a current annual rate of 7.00% and maturing on April 1,
2011 ($10,000,000.00 Multiple Advance Term Note");
(3) Term Promissory Note, dated January 3, 2005, in the original
principal amount of $8,000,000.00, payable by Natural Gas Services
Group, Inc. to the order of Western National Bank, bearing interest at
a current annual rate of 7.00% and maturing on January 1, 2012 ("the
$8,000,000.00 Term Note");
(4) Revolving Line of Credit Promissory Note, dated January 3, 2005, in
the original principal amount of $2,000,000.00, payable by Natural Gas
Services Group, Inc. to the order of Western National Bank, bearing
interest at a current annual rate of 7.00% and maturing on January 1,
2006 (the "Revolving Line of Credit Note");
(5) Term Promissory Note, dated November 3, 2003, in the original
principal amount of $7,521,109.00, payable by Natural Gas Services
Group, Inc. to the order of Western National Bank, bearing interest at
a current annual rate of 7.00% and maturing on September 15, 2007, as
modified in a Modification Agreement, dated January 3, 2005 (the
"$7,521,109.00 Term Note");
(6) Advancing Line of Credit Promissory Note, dated November 3, 2003,
in the original principal amount of $10,000,000.00, payable by Natural
Gas Services Group, Inc. to the order of Western National Bank, bearing
interest at a current annual rate of 7.00% and maturing on November 15,
2009, as modified in a Modification Agreement, dated December 15, 2004
(the "Advancing Line of Credit Note"); and
(7) Term Promissory Note, dated January 3, 2005, in the original
principal amount of $1,415,836.00, payable by Screw Compression
Systems, Inc. to the order of Western National Bank, bearing interest
at a current annual rate of 7.00% and maturing on January 1, 2010 (the
$1,415,836,00 Term Note").
Concurrently with the our execution and delivery of the Loan
Modification Agreement, we also entered into the following note modification
agreements (collectively, the "Note Modification Agreements"):
(1) Modification Agreement, dated effective as of May 1, 2005, by and
between Natural Gas Services Group, Inc. and Western National Bank,
modifying the $1,500,000.00 Multiple Advance Term Note;
(2) Modification Agreement, dated effective as of May 1, 2005, by and
between Natural Gas Services Group, Inc. and Western National Bank,
modifying the $10,000,000.00 Multiple Advance Term Note;
(3) Modification Agreement, dated effective as of May 1, 2005, by and
between Natural Gas Services Group, Inc. and Western National Bank,
modifying the $8,000,000.00 Term Note;
(4) Modification Agreement, dated effective as of May 1, 2005, by and
between Natural Gas Services Group, Inc. and Western National Bank,
modifying the Revolving Line of Credit Note;
(5) Second Modification Agreement, dated effective as of May 1, 2005,
by and between Natural Gas Services Group, Inc. and Western National
Bank, modifying the $7,521,109.00 Term Note;
(6) Second Modification Agreement, dated effective as of May 1, 2005,
by and between Natural Gas Services Group, Inc. and Western National
Bank, modifying the Advancing Line of Credit Note; and
(7) Modification Agreement, dated effective as of May 1, 2005, by and
between Natural Gas Services Group, Inc. and Western National Bank,
modifying the $1,415,836.00 Term Note.
Under the Note Modification Agreements, the annual rate at which each Note bears
interest was reduced by 0.50%, and with the exception of the $7,521,109.00 Term
Note and the Advancing Line of Credit Note, the floor rate of each Note was
reduced from 6.25% to 6.00%. The floor rate of the $7,521,109.00 Term Note and
the Advancing Line of Credit Note remains at 5.25%.
The remaining terms and provisions of the Loan Agreement and the Notes
remain in full force and effect.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Description
----------- -----------
*10.1 First Modification to Fourth Amended and
Restated Loan Agreement, dated effective as
of May 1, 2005, by and among Natural Gas
Services Group, Inc. and Western National
Bank.
*10.2 Modification Agreement, dated effective as
of May 1, 2005, by and between Natural Gas
Services Group, Inc. and Western National
Bank.
*10.3 Modification Agreement, dated effective as
of May 1, 2005, by and between Natural Gas
Services Group, Inc. and Western National
Bank.
*10.4 Modification Agreement, dated effective as
of May 1, 2005, by and between Natural Gas
Services Group, Inc. and Western National
Bank.
*10.5 Modification Agreement, dated effective as
of May 1, 2005, by and between Natural Gas
Services Group, Inc. and Western National
Bank.
*10.6 Second Modification Agreement, dated
effective as of May 1, 2005, by and between
Natural Gas Services Group, Inc. and Western
National Bank.
*10.7 Second Modification Agreement, dated
effective as of May 1, 2005, by and between
Natural Gas Services Group, Inc. and Western
National Bank.
*10.8 Modification Agreement, dated effective as
of May 1, 2005, by and between Natural Gas
Services Group, Inc. and Western National
Bank.
---------------------
* Filed herewith
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.
NATURAL GAS SERVICES GROUP, INC.
By: /s/ Stephen C. Taylor
-----------------------------
Stephen C. Taylor, President
Dated: May 10, 2005
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
*10.1 First Modification to Fourth Amended and Restated Loan
Agreement, dated effective as May 1, 2005, by and among
Natural Gas Services Group, Inc. and Western National Bank.
*10.2 Modification Agreement, dated effective as of May 1, 2005, by
and between Natural Gas Services Group, Inc. and Western
National Bank.
*10.3 Modification Agreement, dated effective as of May 1, 2005, by
and between Natural Gas Services Group, Inc. and Western
National Bank.
*10.4 Modification Agreement, dated effective as of May 1, 2005, by
and between Natural Gas Services Group, Inc. and Western
National Bank.
*10.5 Modification Agreement, dated effective as of May 1, 2005, by
and between Natural Gas Services Group, Inc. and Western
National Bank.
*10.6 Second Modification Agreement, dated effective as of May 1,
2005, by and between Natural Gas Services Group, Inc. and
Western National Bank.
*10.7 Second Modification Agreement, dated effective as of May 1,
2005, by and between Natural Gas Services Group, Inc. and
Western National Bank.
*10.8 Modification Agreement, dated effective as of May 1, 2005, by
and between Natural Gas Services Group, Inc. and Western
National Bank.
- ---------------------
* Filed herewith
Exhibit 10.1
FIRST MODIFICATION TO
FOURTH AMENDED AND RESTATED
LOAN AGREEMENT
This First Modification to Fourth Amended and Restated Loan Agreement
(the "First Modification") is made and entered into effective May 1, 2005, by
and among Natural Gas Services Group, Inc. ("Borrower"), Screw Compression
Systems, Inc. ("Guarantor"), and Western National Bank ("Lender")
RECITALS
WHEREAS, Borrower, Guarantor, and Lender entered into that certain
Fourth Amended and Restated Loan Agreement dated March 14, 2005 (the "Loan
Agreement"); and
WHEREAS, Borrower , Guarantor, and Lender now desire to modify the
definition of "Consolidated Current Ratio" as set out in the Loan Agreement and
to modify certain other related provisions of the Loan Agreement.
NOW THEREFORE, in view of the foregoing and in consideration of the
mutual covenants and agreements hereinafter contained, Borrower, Guarantor, and
Lender hereby agree as follows:
ARTICLE 1
Modification of Loan Agreement
------------------------------
The Loan Agreement is hereby amended on the effective date of this
amendment in the following respects:
1. Paragraph 1.1 Defined Terms is amended in the following respects:
"Consolidated Current Ratio" means the ratio of (i) the sum of the
current assets and restricted cash of the Borrower and its Subsidiaries
to (ii) the sum of the current liabilities of the Borrower and its
Subsidiaries, all determined on a consolidated basis."
2. Paragraph 6.1(a) Consolidated Current Ratio is amended in the following
respects:
"(a) Consolidated Current Ratio. Permit the Consolidated Current Ratio,
as defined herein and calculated pursuant to Exhibit S hereto, to be
less than 1.4 to 1.0 as of February 28, 2005, and as of the end of each
month thereafter."
1
3. Exhibit S - Consolidated Current Ratio Calculation, Paragraph 1 is
amended in the following respects:
"1. Sum of current assets and restricted cash of Borrower and its
consolidated Subsidiaries"
ARTICLE 2
Miscellaneous
-------------
1. The provisions of this First Modification to Fourth Amended and
Restated Loan Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and are incorporated by reference into the Loan Agreement as
if set out verbatim therein.
2. The Loan Agreement, as amended herein, is hereby ratified, adopted and
confirmed by Borrower and the Guarantor. Each agreement, representation,
warranty and covenant made by Borrower and Guarantor in the Loan Agreement is
hereby ratified, adopted, and confirmed by Borrower and Guarantor on the date of
execution hereof.
3. The effective date of this First Modification to Fourth Amended and
Restated Loan Agreement shall be May 1, 2005, at which time the provisions of
this First Modification to Fourth Amended and Restated Loan Agreement shall
become operative and are incorporated into the Loan Agreement.
THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
Executed on May 5, 2005, but effective as of May 1, 2005.
BORROWER:
---------
Natural Gas Services Group, Inc.
By: /s/ Stephen C. Taylor
---------------------------------------
Stephen C. Taylor, President
2
GUARANTOR:
----------
Screw Compression Systems, Inc.
By /s/ Paul D. Hensley
----------------------------------------
Paul D. Hensley, President
LENDER:
-------
Western National Bank
By /s/ Scott A. Lovett
----------------------------------------
Scott A. Lovett, Executive Vice President
3
Exhibit 10.2
$1,500,000.00 Multiple Advance Term Note
dated March 14, 2005
MODIFICATION AGREEMENT
This Modification Agreement ("Modification Agreement") is effective as of May 1,
2005. The parties to the Modification Agreement are Natural Gas Services Group,
Inc. ("Borrower") and Western National Bank ("Lender").
RECITALS
On March 14, 2005, Borrower executed and delivered to Lender that certain
Multiple Advance Term Promissory Note in the original principal sum of
$1,500,000.00, bearing interest at the rate stated therein, with a stated final
maturity date of April 1, 2010 (the "Note"), pursuant to that certain Fourth
Amended and Restated Loan Agreement dated March 14, 2005 (the "Loan Agreement").
All liens, security interests and assignments securing the Note are collectively
called the "Liens". Terms defined in the Note or the Loan Agreement and not
otherwise defined herein shall have the same meanings here as in those
documents.
At Borrower's request, Borrower and Lender have agreed to enter into this
Modification Agreement to modify the interest provisions of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of May
1, 2005.
AGREEMENT
1. Modification of Interest Provisions of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) six and one-quarter percent (6.25%), or (b) the
Highest Lawful Rate, in each case calculated on the basis of actual
days elapsed, but computed as if each calendar year consisted of 360
days."
such provisions of the Note are changed to read in their entirety as follows:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one-half percent (0.5%) over the Prime Rate in
effect from day to day, or (ii) six and one- quarter percent (6.25%),
or (b) the Highest Lawful Rate, in each case calculated on the basis of
actual days elapsed, but computed as if each calendar year consisted of
360 days."
1
3. Ratification of Liens. Borrower and Lender further agree that all Liens
securing the Note shall continue and carry forward until the Note and all
indebtedness evidenced thereby is paid in full. Borrower further agrees that
such liens are hereby ratified and affirmed as valid and subsisting against the
collateral described therein, and that this Modification Agreement shall in no
manner vitiate, affect or impair the Note or the Liens (except as expressly
modified in this Modification Agreement) and that such Liens shall not in any
manner be waived, released, altered or modified.
4. Miscellaneous.
(a) As modified hereby, the provisions of the Note and the Liens
shall continue in full force and effect, and Borrower
acknowledges and affirms its liability to Lender thereunder.
In the event of an inconsistency between this Modification
Agreement and the terms of the Note or of the Liens, this
Modification Agreement shall govern.
(b) Borrower hereby agrees to pay all costs and expenses incurred
by Lender in connection with the execution and administration
of this Modification Agreement.
(c) Any default by Borrower in the performance of its obligations
herein contained shall constitute a default under the Note and
the Liens and shall allow Lender to exercise any or all of its
remedies set forth in such Note and Liens or at law or in
equity.
(d) Lender does not, by its execution of this Modification
Agreement, waive any rights it may have against any person not
a party hereto.
(e) All terms, provisions, covenants, agreements, and conditions
of the Note and the Liens are unchanged, except as provided
herein. Borrower agrees that this Modification Agreement and
all of the covenants and agreements contained herein shall be
binding upon Borrower and shall inure to the benefit of Lender
and each of their respective heirs, executors, legal
representatives, successors, and permitted assigns.
THIS MODIFICATION AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREE MENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
2
Borrower:
---------
Natural Gas Services Group, Inc.
By: /s/ Stephen C. Taylor
----------------------------------------
Stephen C. Taylor, President
Lender:
-------
Western National Bank
By /s/ Scott A. Lovet
-----------------------------------------
Scott A. Lovett, Executive Vice President
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 10, 2005, by Stephen
C. Taylor, President of Natural Gas Services Group, Inc., a Colorado
corporation, on behalf of said corporation.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 11, 2005, by Scott A.
Lovett, Executive Vice President of Western National Bank, a national banking
association, on behalf of said association.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
3
Exhibit 10.3
$10,000,000.00 Multiple Advance Term Note
dated March 14, 2005
MODIFICATION AGREEMENT
This Modification Agreement ("Modification Agreement") is effective as of May 1,
2005. The parties to the Modification Agreement are Natural Gas Services Group,
Inc. ("Borrower") and Western National Bank ("Lender").
RECITALS
On March 14, 2005, Borrower executed and delivered to Lender that certain
Multiple Advance Term Promissory Note in the original principal sum of
$10,000,000.00, bearing interest at the rate stated therein, with a stated final
maturity date of April 1, 2011 (the "Note"), pursuant to that certain Fourth
Amended and Restated Loan Agreement dated March 14, 2005 (the "Loan Agreement").
All liens, security interests and assignments securing the Note are collectively
called the "Liens". Terms defined in the Note or the Loan Agreement and not
otherwise defined herein shall have the same meanings here as in those
documents.
At Borrower's request, Borrower and Lender have agreed to enter into this
Modification Agreement to modify the interest provisions of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of May
1, 2005.
AGREEMENT
1. Modification of Interest Provisions of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) six and one-quarter percent (6.25%), or (b) the
Highest Lawful Rate, in each case calculated on the basis of actual
days elapsed, but computed as if each calendar year consisted of 360
days."
such provisions of the Note are changed to read in their entirety as follows:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one-half percent (0.5%) over the Prime Rate in
effect from day to day, or (ii) six and one- quarter percent (6.25%),
or (b) the Highest Lawful Rate, in each case calculated on the basis of
actual days elapsed, but computed as if each calendar year consisted of
360 days."
1
3. Ratification of Liens. Borrower and Lender further agree that all Liens
securing the Note shall continue and carry forward until the Note and all
indebtedness evidenced thereby is paid in full. Borrower further agrees that
such liens are hereby ratified and affirmed as valid and subsisting against the
collateral described therein, and that this Modification Agreement shall in no
manner vitiate, affect or impair the Note or the Liens (except as expressly
modified in this Modification Agreement) and that such Liens shall not in any
manner be waived, released, altered or modified.
4. Miscellaneous.
(a) As modified hereby, the provisions of the Note and the Liens
shall continue in full force and effect, and Borrower
acknowledges and affirms its liability to Lender thereunder.
In the event of an inconsistency between this Modification
Agreement and the terms of the Note or of the Liens, this
Modification Agreement shall govern.
(b) Borrower hereby agrees to pay all costs and expenses incurred
by Lender in connection with the execution and administration
of this Modification Agreement.
(c) Any default by Borrower in the performance of its obligations
herein contained shall constitute a default under the Note and
the Liens and shall allow Lender to exercise any or all of its
remedies set forth in such Note and Liens or at law or in
equity.
(d) Lender does not, by its execution of this Modification
Agreement, waive any rights it may have against any person not
a party hereto.
(e) All terms, provisions, covenants, agreements, and conditions
of the Note and the Liens are unchanged, except as provided
herein. Borrower agrees that this Modification Agreement and
all of the covenants and agreements contained herein shall be
binding upon Borrower and shall inure to the benefit of Lender
and each of their respective heirs, executors, legal
representatives, successors, and permitted assigns.
THIS MODIFICATION AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREE MENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
2
Borrower:
---------
Natural Gas Services Group, Inc.
By: /s/ Stephen C. Taylor
----------------------------------------
Stephen C. Taylor, President
Lender:
-------
Western National Bank
By /s/ Scott A. Lovett
-----------------------------------------
Scott A. Lovett, Executive Vice President
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 10, 2005, by Stephen
C. Taylor, President of Natural Gas Services Group, Inc., a Colorado
corporation, on behalf of said corporation.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 11, 2005, by Scott A.
Lovett, Executive Vice President of Western National Bank, a national banking
association, on behalf of said association.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
3
Exhibit 10.4
$8,000,000.00 Term Note
dated January 3, 2005
MODIFICATION AGREEMENT
This Modification Agreement ("Modification Agreement") is effective as of May 1,
2005. The parties to the Modification Agreement are Natural Gas Services Group,
Inc. ("Borrower") and Western National Bank ("Lender").
RECITALS
On January 3, 2005, Borrower executed and delivered to Lender that certain Term
Promissory Note in the original principal sum of $8,000,000.00, bearing interest
at the rate stated therein, with a stated final maturity date of January 1, 2012
(the "Note"), pursuant to that certain Third Amended and Restated Loan Agreement
dated January 3, 2005, and subsequently amended and restated in that certain
Fourth Amended and Restated Loan Agreement dated March 14, 2005 (the "Loan
Agreement"). All liens, security interests and assignments securing the Note are
collectively called the "Liens". Terms defined in the Note or the Loan Agreement
and not otherwise defined herein shall have the same meanings here as in those
documents.
At Borrower's request, Borrower and Lender have agreed to enter into this
Modification Agreement to modify the interest provisions of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of May
1, 2005.
AGREEMENT
1. Modification of Interest Provisions of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) six percent (6.0%), or (b) the Highest Lawful Rate,
in each case calculated on the basis of actual days elapsed, but
computed as if each calendar year consisted of 360 days."
such provisions of the Note are changed to read in their entirety as follows:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one-half percent (0.5%) over the Prime Rate in
effect from day to day, or (ii) six percent (6.0%), or (b) the Highest
Lawful Rate, in each case calculated on the basis of actual days
elapsed, but computed as if each calendar year consisted of 360 days."
1
3. Ratification of Liens. Borrower and Lender further agree that all Liens
securing the Note shall continue and carry forward until the Note and all
indebtedness evidenced thereby is paid in full. Borrower further agrees that
such liens are hereby ratified and affirmed as valid and subsisting against the
collateral described therein, and that this Modification Agreement shall in no
manner vitiate, affect or impair the Note or the Liens (except as expressly
modified in this Modification Agreement) and that such Liens shall not in any
manner be waived, released, altered or modified.
4. Miscellaneous.
(a) As modified hereby, the provisions of the Note and the Liens
shall continue in full force and effect, and Borrower
acknowledges and affirms its liability to Lender thereunder.
In the event of an inconsistency between this Modification
Agreement and the terms of the Note or of the Liens, this
Modification Agreement shall govern.
(b) Borrower hereby agrees to pay all costs and expenses incurred
by Lender in connection with the execution and administration
of this Modification Agreement.
(c) Any default by Borrower in the performance of its obligations
herein contained shall constitute a default under the Note and
the Liens and shall allow Lender to exercise any or all of its
remedies set forth in such Note and Liens or at law or in
equity.
(d) Lender does not, by its execution of this Modification
Agreement, waive any rights it may have against any person not
a party hereto.
(e) All terms, provisions, covenants, agreements, and conditions
of the Note and the Liens are unchanged, except as provided
herein. Borrower agrees that this Modification Agreement and
all of the covenants and agreements contained herein shall be
binding upon Borrower and shall inure to the benefit of Lender
and each of their respective heirs, executors, legal
representatives, successors, and permitted assigns.
THIS MODIFICATION AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREE MENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
2
Borrower:
---------
Natural Gas Services Group, Inc.
By: /s/ Stephen C. Taylor
----------------------------------------
Stephen C. Taylor, President
Lender:
-------
Western National Bank
By /s/ Scott A. Lovett
-----------------------------------------
Scott A. Lovett, Executive Vice President
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 10, 2005, by Stephen
C. Taylor, President of Natural Gas Services Group, Inc., a Colorado
corporation, on behalf of said corporation.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 11, 2005, by Scott A.
Lovett, Executive Vice President of Western National Bank, a national banking
association, on behalf of said association.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
3
Exhibit 10.5
Revolving Line Credit Note
dated January 3, 2005
MODIFICATION AGREEMENT
This Modification Agreement ("Modification Agreement") is effective as of May 1,
2005. The parties to the Modification Agreement are Natural Gas Services Group,
Inc. ("Borrower") and Western National Bank ("Lender").
RECITALS
On January 3, 2005, Borrower executed and delivered to Lender that certain
Revolving Line of Credit Promissory Note in the original principal sum of
$2,000,000.00, bearing interest at the rate stated therein, with a stated final
maturity date of January 1, 2006 (the "Note"), pursuant to that certain Third
Amended and Restated Loan Agreement dated January 3, 2005, as subsequently
amended and restated in that certain Fourth Amended and Restated Loan Agreement
dated March 14, 2005 (the "Loan Agreement"). All liens, security interests and
assignments securing the Note are collectively called the "Liens". Terms defined
in the Note or the Loan Agreement and not otherwise defined herein shall have
the same meanings here as in those documents.
At Borrower's request, Borrower and Lender have agreed to enter into this
Modification Agreement to modify the interest provisions of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of May
1, 2005.
AGREEMENT
1. Modification of Interest Provisions of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) six percent (6.0%), or (b) the Highest Lawful Rate,
in each case calculated on the basis of actual days elapsed, but
computed as if each calendar year consisted of 360 days."
such provisions of the Note are changed to read in their entirety as follows:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one-half percent (0.5%) over the Prime Rate in
effect from day to day, or (ii) six percent (6.0%), or (b) the Highest
Lawful Rate, in each case calculated on the basis of actual days
elapsed, but computed as if each calendar year consisted of 360 days."
1
3. Ratification of Liens. Borrower and Lender further agree that all Liens
securing the Note shall continue and carry forward until the Note and all
indebtedness evidenced thereby is paid in full. Borrower further agrees that
such liens are hereby ratified and affirmed as valid and subsisting against the
collateral described therein, and that this Modification Agreement shall in no
manner vitiate, affect or impair the Note or the Liens (except as expressly
modified in this Modification Agreement) and that such Liens shall not in any
manner be waived, released, altered or modified.
4. Miscellaneous.
(a) As modified hereby, the provisions of the Note and the Liens
shall continue in full force and effect, and Borrower
acknowledges and affirms its liability to Lender thereunder.
In the event of an inconsistency between this Modification
Agreement and the terms of the Note or of the Liens, this
Modification Agreement shall govern.
(b) Borrower hereby agrees to pay all costs and expenses incurred
by Lender in connection with the execution and administration
of this Modification Agreement.
(c) Any default by Borrower in the performance of its obligations
herein contained shall constitute a default under the Note and
the Liens and shall allow Lender to exercise any or all of its
remedies set forth in such Note and Liens or at law or in
equity.
(d) Lender does not, by its execution of this Modification
Agreement, waive any rights it may have against any person not
a party hereto.
(e) All terms, provisions, covenants, agreements, and conditions
of the Note and the Liens are unchanged, except as provided
herein. Borrower agrees that this Modification Agreement and
all of the covenants and agreements contained herein shall be
binding upon Borrower and shall inure to the benefit of Lender
and each of their respective heirs, executors, legal
representatives, successors, and permitted assigns.
THIS MODIFICATION AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREE MENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
2
Borrower:
---------
Natural Gas Services Group, Inc.
By: /s/ Stephen C. Taylor
----------------------------------------
Stephen C. Taylor, President
Lender:
-------
Western National Bank
By /s/ Scott A. Lovett
-----------------------------------------
Scott A. Lovett, Executive Vice President
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 10, 2005, by Stephen
C. Taylor, President of Natural Gas Services Group, Inc., a Colorado
corporation, on behalf of said corporation.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 11, 2005, by Scott A.
Lovett, Executive Vice President of Western National Bank, a national banking
association, on behalf of said association.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
3
Exhibit 10.6
$7,521,109.00 Term Note
dated November 3, 2003
SECOND MODIFICATION AGREEMENT
This Second Modification Agreement ("Second Modification Agreement") is
effective as of May 1, 2005. The parties to the Second Modification Agreement
are Natural Gas Services Group, Inc. ("Borrower") and Western National Bank
("Lender").
RECITALS
On November 3, 2003, Borrower executed and delivered to Lender that certain Term
Promissory Note in the original principal sum of $7,521,109.00, bearing interest
at the rate stated therein, with a stated final maturity date of September 15,
2007, as modified in Modification Agreement dated January 3, 2005 (the "Note").
The Note was made pursuant to that certain Second Amended and Restated Loan
Agreement dated November 3, 2003, as subsequently amended and restated in that
certain Third Amended and Restated Loan Agreement dated January 3, 2005, and
that certain Fourth Amended and Restated Loan Agreement dated March 14, 2005
(the "Loan Agreement"). All liens, security interests and assignments securing
the Note are collectively called the "Liens". Terms defined in the Note or the
Loan Agreement and not otherwise defined herein shall have the same meanings
here as in those documents.
At Borrower's request, Borrower and Lender have agreed to enter into this Second
Modification Agreement to modify the interest provisions of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of May
1, 2005.
AGREEMENT
1. Modification of Interest Provisions of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) five and one-quarter percent (5.25%), or (b) the
Highest Lawful Rate, in each case calculated on the basis of actual
days elapsed, but computed as if each calendar year consisted of 360
days."
such provisions of the Note are changed to read in their entirety as follows:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one-half percent (0.5%) over the Prime Rate in
effect from day to day, or (ii) five and one- quarter percent (5.25%),
or (b) the Highest Lawful Rate, in each case calculated on the basis of
actual days elapsed, but computed as if each calendar year consisted of
360 days."
1
2. Ratification of Liens. Borrower and Lender further agree that all Liens
securing the Note shall continue and carry forward until the Note and all
indebtedness evidenced thereby is paid in full. Borrower further agrees that
such liens are hereby ratified and affirmed as valid and subsisting against the
collateral described therein, and that this Second Modification Agreement shall
in no manner vitiate, affect or impair the Note or the Liens (except as
expressly modified in this Second Modification Agreement) and that such Liens
shall not in any manner be waived, released, altered or modified.
3. Miscellaneous.
(a) As modified hereby, the provisions of the Note and the Liens
shall continue in full force and effect, and Borrower
acknowledges and affirms its liability to Lender thereunder.
In the event of an inconsistency between this Second
Modification Agreement and the terms of the Note or of the
Liens, this Second Modification Agreement shall govern.
(b) Borrower hereby agrees to pay all costs and expenses incurred
by Lender in connection with the execution and administration
of this Second Modification Agreement.
(c) Any default by Borrower in the performance of its obligations
herein contained shall constitute a default under the Note and
the Liens and shall allow Lender to exercise any or all of its
remedies set forth in such Note and Liens or at law or in
equity.
(d) Lender does not, by its execution of this Second Modification
Agreement, waive any rights it may have against any person not
a party hereto.
(e) All terms, provisions, covenants, agreements, and conditions
of the Note and the Liens are unchanged, except as provided
herein. Borrower agrees that this Second Modification
Agreement and all of the covenants and agreements contained
herein shall be binding upon Borrower and shall inure to the
benefit of Lender and each of their respective heirs,
executors, legal representatives, successors, and permitted
assigns.
THIS SECOND MODIFICATION AGREEMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.
2
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
Borrower:
---------
Natural Gas Services Group, Inc.
By: /s/ Stephen C. Taylor
----------------------------------------
Stephen C. Taylor, President
Lender:
-------
Western National Bank
By /s/ Scott A. Lovett
-----------------------------------------
Scott A. Lovett, Executive Vice President
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 10, 2005, by Stephen
C. Taylor, President of Natural Gas Services Group, Inc., a Colorado
corporation, on behalf of said corporation.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 11, 2005, by Scott A.
Lovett, Executive Vice President of Western National Bank, a national banking
association, on behalf of said association.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
3
Exhibit 10.7
Advancing Line of Credit Note
dated November 3, 2003
SECOND MODIFICATION AGREEMENT
This Second Modification Agreement ("Second Modification Agreement") is
effective as of May 1, 2005. The parties to the Second Modification Agreement
are Natural Gas Services Group, Inc. ("Borrower") and Western National Bank
("Lender").
RECITALS
On November 3, 2003, Borrower executed and delivered to Lender that certain
Advancing Line of Credit Promissory Note in the original principal sum of
$10,000,000.00, bearing interest at the rate stated therein, with a stated final
maturity date of November 15, 2009, as modified in Modification Agreement dated
December 15, 2004 (the "Note"). The Note was made pursuant to that certain
Second Amended and Restated Loan Agreement dated November 3, 2003, as
subsequently amended and restated in that certain Third Amended and Restated
Loan Agreement dated January 3, 2005, and that certain Fourth Amended and
Restated Loan Agreement dated March 14, 2005 (the "Loan Agreement"). All liens,
security interests and assignments securing the Note are collectively called the
"Liens". Terms defined in the Note or the Loan Agreement and not otherwise
defined herein shall have the same meanings here as in those documents.
At Borrower's request, Borrower and Lender have agreed to enter into this Second
Modification Agreement to modify the interest provisions of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of May
1, 2005.
AGREEMENT
1. Modification of Interest Provisions of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note, as modified
in Modification Agreement dated December 15, 2004:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) five and one-quarter percent (5.25%), or (b) the
Highest Lawful Rate, in each case calculated on the basis of actual
days elapsed, but computed as if each calendar year consisted of 360
days."
such provisions of the Note are changed to read in their entirety as follows:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one-half percent (0.5%) over the Prime Rate in
effect from day to day, or (ii) five and one- quarter percent (5.25%),
or (b) the Highest Lawful Rate, in each case calculated on the basis of
actual days elapsed, but computed as if each calendar year consisted of
360 days."
1
2. Ratification of Liens. Borrower and Lender further agree that all Liens
securing the Note shall continue and carry forward until the Note and all
indebtedness evidenced thereby is paid in full. Borrower further agrees that
such liens are hereby ratified and affirmed as valid and subsisting against the
collateral described therein, and that this Second Modification Agreement shall
in no manner vitiate, affect or impair the Note or the Liens (except as
expressly modified in this Second Modification Agreement) and that such Liens
shall not in any manner be waived, released, altered or modified.
3. Miscellaneous.
(a) As modified hereby, the provisions of the Note and the Liens
shall continue in full force and effect, and Borrower
acknowledges and affirms its liability to Lender thereunder.
In the event of an inconsistency between this Second
Modification Agreement and the terms of the Note or of the
Liens, this Second Modification Agreement shall govern.
(b) Borrower hereby agrees to pay all costs and expenses incurred
by Lender in connection with the execution and administration
of this Second Modification Agreement.
(c) Any default by Borrower in the performance of its obligations
herein contained shall constitute a default under the Note and
the Liens and shall allow Lender to exercise any or all of its
remedies set forth in such Note and Liens or at law or in
equity.
(d) Lender does not, by its execution of this Second Modification
Agreement, waive any rights it may have against any person not
a party hereto.
(e) All terms, provisions, covenants, agreements, and conditions
of the Note and the Liens are unchanged, except as provided
herein. Borrower agrees that this Second Modification
Agreement and all of the covenants and agreements contained
herein shall be binding upon Borrower and shall inure to the
benefit of Lender and each of their respective heirs,
executors, legal representatives, successors, and permitted
assigns.
THIS SECOND MODIFICATION AGREEMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES.
2
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
Borrower:
---------
Natural Gas Services Group, Inc.
By: /s/ Stephen C. Taylor
----------------------------------------
Stephen C. Taylor, President
Lender:
-------
Western National Bank
By /s/ Scott A. Lovett
-----------------------------------------
Scott A. Lovett, Executive Vice President
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 10, 2005, by Stephen
C. Taylor, President of Natural Gas Services Group, Inc., a Colorado
corporation, on behalf of said corporation.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 11, 2005, by Scott A.
Lovett, Executive Vice President of Western National Bank, a national banking
association, on behalf of said association.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
3
Exhibit 10.8
$1,415,836.00 Term Note
dated January 3, 2005
MODIFICATION AGREEMENT
This Modification Agreement ("Modification Agreement") is effective as of May 1,
2005. The parties to the Modification Agreement are Screw Compression Systems,
Inc. ("Borrower") and Western National Bank ("Lender").
RECITALS
On January 3, 2005, Borrower executed and delivered to Lender that certain Term
Promissory Note in the original principal sum of $1,415,836.00, bearing interest
at the rate stated therein, with a stated final maturity date of January 1, 2010
(the "Note"), pursuant to that certain Third Amended and Restated Loan Agreement
dated January 3, 2005 (the "Prior Loan Agreement"), as amended and restated in
that certain Fourth Amended and Restated Loan Agreement dated March 15, 2005
(the "Loan Agreement"). All liens, security interests and assignments securing
the Note are collectively called the "Liens". Terms defined in the Note or the
Loan Agreement and not otherwise defined herein shall have the same meanings
here as in those documents.
At Borrower's request, Borrower and Lender have agreed to enter into this
Modification Agreement to modify the interest provisions of the Note and to
ratify the Liens. Said modified interest provisions shall be effective as of May
1, 2005.
AGREEMENT
1. Modification of Interest Provisions of the Note. In lieu of the following
provisions which were contained in the first paragraph of the Note:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one percent (1%) over the Prime Rate in effect from
day to day, or (ii) six percent (6.0%), or (b) the Highest Lawful Rate,
in each case calculated on the basis of actual days elapsed, but
computed as if each calendar year consisted of 360 days."
such provisions of the Note are changed to read in their entirety as follows:
"...at a rate per annum which shall from day to day be equal
to the lesser of (a) a rate per annum (the "Established Rate") equal to
the greater of (i) one-half percent (0.5%) over the Prime Rate in
effect from day to day, or (ii) six percent (6.0%), or (b) the Highest
Lawful Rate, in each case calculated on the basis of actual days
elapsed, but computed as if each calendar year consisted of 360 days."
1
3. Ratification of Liens. Borrower and Lender further agree that all Liens
securing the Note shall continue and carry forward until the Note and all
indebtedness evidenced thereby is paid in full. Borrower further agrees that
such liens are hereby ratified and affirmed as valid and subsisting against the
collateral described therein, and that this Modification Agreement shall in no
manner vitiate, affect or impair the Note or the Liens (except as expressly
modified in this Modification Agreement) and that such Liens shall not in any
manner be waived, released, altered or modified.
4. Miscellaneous.
(a) As modified hereby, the provisions of the Note and the Liens
shall continue in full force and effect, and Borrower
acknowledges and affirms its liability to Lender thereunder.
In the event of an inconsistency between this Modification
Agreement and the terms of the Note or of the Liens, this
Modification Agreement shall govern.
(b) Borrower hereby agrees to pay all costs and expenses incurred
by Lender in connection with the execution and administration
of this Modification Agreement.
(c) Any default by Borrower in the performance of its obligations
herein contained shall constitute a default under the Note and
the Liens and shall allow Lender to exercise any or all of its
remedies set forth in such Note and Liens or at law or in
equity.
(d) Lender does not, by its execution of this Modification
Agreement, waive any rights it may have against any person not
a party hereto.
(e) All terms, provisions, covenants, agreements, and conditions
of the Note and the Liens are unchanged, except as provided
herein. Borrower agrees that this Modification Agreement and
all of the covenants and agreements contained herein shall be
binding upon Borrower and shall inure to the benefit of Lender
and each of their respective heirs, executors, legal
representatives, successors, and permitted assigns.
THIS MODIFICATION AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREE MENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
2
Borrower:
---------
Screw Compression Systems, Inc.
By: /s/ Paul D. Hensley
----------------------------------------
Paul D. Hensley, President
Lender:
-------
Western National Bank
By /s/ Scott A. Lovet
-----------------------------------------
Scott A. Lovett, Executive Vice President
STATE OF OKLAHOMA ss.
ss.
COUNTY OF ROGERS ss.
This instrument was acknowledged before me on May 10, 2005, by Paul D.
Hensley, President of Screw Compression Systems, Inc., a Texas corporation, on
behalf of said corporation.
Notary Public, State of Oklahoma
Printed Name: Deborah K. Tullos
----------------------------
Commission Expires: August 17, 2005
----------------------
STATE OF TEXAS ss.
ss.
COUNTY OF MIDLAND ss.
This instrument was acknowledged before me on May 11, 2005, by Scott A.
Lovett, Executive Vice President of Western National Bank, a national banking
association, on behalf of said association.
/s/ Deborah K. Tullos
-----------------------------------------
Notary Public, State of Texas
3