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)
AUGUST 14, 2006
WARRIOR ENERGY SERVICES CORPORATION
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(Exact name of registrant as specified in its charter)
DELAWARE 0-18754 11-2904094
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
100 ROSECREST LANE, COLUMBUS, MISSISSIPPI 39701
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(Address of principal executive offices)
Registrant's telephone number, including area code: (662) 329-1047
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(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 (see General Instruction A.2.below):
|_| Written communications pursuant to Rule 425 under the Securities Act
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act
|_| Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act
SECTION I - REGISTRANT'S BUSINESS
AND OPERATIONS
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
Amendments to Second Amended and Restated Credit Agreement.
(i) On June 22, 2006, we entered into a Third Amendment (the
"Third Amendment") to our Second Amended and Restated Credit Agreement (the
"Credit Agreement") with General Electric Capital Corporation ("GECC"). The
Third Amendment amended the financial covenants of our Credit Agreement to
increase to $15.0 million from $10.0 million the maximum amount of capital
expenditure we are permitted to make during the year ended December 31, 2006.
(ii) On August 14, 2006, we entered into a Fourth Amendment
(the "Fourth Amendment") to our Credit Agreement with GECC. Among other
amendments, the Fourth Amendment
o Increased the revolving credit facility by $15.0 million
or a facility limit of up to $30.0 million, but not
exceeding a borrowing base of 85% of the book value of
eligible accounts receivable, less any reserves GECC may
establish from time to time,
o Increased the lending limit on the capital expenditure
loan facility by $20.0 million or a lending limit of up to
$25.0 million, but not exceeding the lesser of 80% of the
hard costs of eligible capital equipment and 75% of the
forced liquidation value of eligible capital equipment,
subject to adjustment by GECC. The date through which
capital expenditure loans are available to be made under
the Credit Agreement was extended by six months through
June 16, 2007,
o Amended further the maximum amount of capital expenditures
we are permitted to make as follows:
Period Maximum Capital Expenditure
------ per Period
----------
Year Ended December 31, 2006 $45.0 million
Year Ended December 31, 2007 $50.0 million
Each Year Ended December 31 thereafter $40.0 million
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o The repayment provisions of the capital expenditure loan
were amended to provide that the capital expenditure loan
is to be repaid in eight quarterly installments commencing
January 1, 2007 and continuing thereafter with the first
two installments to be equal to $250,000 and the last six
installments to be equal to the sum of $250,000 plus
1/20th of the principal amount of the capital expenditure
loan funded on or after August 14, 2006. A final ninth
installment is due and payable on December 16, 2008 and is
to be in the amount of the entire remaining balance of the
capital expenditure loan.
o The repayment provisions of the term loan were amended to
provide that the final payment on the term loan is due and
payable on December 16, 2008 rather than December 31,
2008.
o The interest rate on borrowings under the Credit Agreement
as entered into on December 16, 2005 is based on an index
rate, as defined, plus an interest rate margin. The Credit
Agreement provides that the interest rate margins are
adjusted on a quarterly basis based on our ratio of our
funded debt to EBITDA for the trailing twelve months prior
to the determination. The Fourth Amendment provides that
the interest rate margins are amended to provide for the
addition of two lower-bracket interest rate margins
ranging, as applicable to the revolving loan, term loan
and capital expenditure loan, from 0.5% and 0.75% to 2.0%
and 2.25% based upon our ratio of funded debt to EBITDA
for the period being equal to a ratio of less than 0.5 to
1.0 and less than 1.0 to 1.0, respectively.
o The Credit Agreement was further amended to enable us to
request and the lenders agreed to provide or enable the
issuance to us of letters of credit of up to one year
duration and in amounts up to the lesser of $2.0 million
and the amount available to be borrowed under the
revolving credit facility of the Credit Agreement.
Reference is made to the Credit Agreement filed as an exhibit
to our Current Report on Form 8-K for December 16, 2005 and the First and Second
Amendments thereto filed as exhibits to our Current Report on Form 8-K for April
18, 2006 and to Exhibits 10.1 and 10.2 to this Current Report on Form 8-K for a
further statement of the terms and conditions of the credit facility.
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SECTION 9. FINANCIAL STATEMENTS AND EXHIBITS.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial statements of businesses acquired.
Not applicable.
(b) Pro forma financial information.
Not applicable.
(c) Exhibits.
10.1 Third Amendment dated June 22, 2006 to
Second Amended and Restated Credit
Agreement with General Electric Capital
Corporation.
10.2 Fourth Amendment dated August 14, 2006 to
Second Amended and Restated Credit
Agreement with General Electric Capital
Corporation.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
WARRIOR ENERGY SERVICES CORPORATION
Dated: August 16, 2006 By: /s/ William L. Jenkins
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William L. Jenkins, President
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INDEX TO EXHIBITS
10.1 Third Amendment dated June 22, 2006 to
Second Amended and Restated Credit
Agreement with General Electric Capital
Corporation.
10.2 Fourth Amendment dated August 14, 2006 to
Second Amended and Restated Credit
Agreement with General Electric Capital
Corporation.
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