EXHIBIT 99.3.1
BLACK WARRIOR WIRELINE CORP.
100 Rosecrest Lane,
Columbus, Mississippi 39701
TEL: (662) 329-1047
FAX: (662) 329-1089
November 15, 2005
Holder
RE: REQUEST TO HOLDERS OF CONVERTIBLE PROMISSORY NOTES OF BLACK
WARRIOR WIRELINE CORP., ISSUED DECEMBER 1999 THROUGH FEBRUARY 2000
(THE "1999 NOTES") FOR CONSENT TO CREDIT AGREEMENT FACILITIES
RELATING TO BOBCAT ACQUISITION
Dear Sir or Madam:
On October 7, 2005, we wrote to you describing Black Warrior Wireline
Corp.'s Recapitalization Plan and offer to exchange one share for three warrants
(the "Recapitalization Letter"). In the section of the Recapitalization Letter
entitled "Recent Developments" we said:
On September 19, 2005, we entered into a letter of intent to
purchase from the holders all of the outstanding equity securities of
Bobcat Pressure Control, Inc. ("Bobcat"). The purchase price is $51.5
million, less the amount of long-term debt, including current
maturities, payable in cash at the closing of the transaction. Together
with its wholly-owned subsidiary, The Bobby Joe Cudd Co., Bobcat
provides snubbing services to oil and natural gas well operators in the
Mid-Continent area of the United States. Using a series of high
pressure blow-out preventers, a snubbing unit makes it possible to
remove and replace down-hole equipment in a well (such as drill pipe,
casing or tubing) in a pressurized environment, allowing an operator to
service a well without using other more disruptive means to control the
pressure in the well. Bobcat also provides other oil field services,
including freezing, hot tap services, well control, fishing, rental
tool services and drillouts.
The closing of the acquisition is subject to our completion of
due diligence inquiries into Bobcat, the negotiation and execution of a
definitive purchase agreement, our completion of financing for the
transaction and fulfillment of customary closing conditions contained
in the definitive purchase agreement.
We intend that the purchase price for the Bobcat securities
will be financed with the proceeds of additional senior secured
borrowings, a portion of which, if the acquisition is completed, we
expect will be repaid using a portion of the proceeds from the proposed
underwritten offering.
10
Since the Recapitalization Letter, we have made substantial progress
toward completing the Bobcat transaction. While no agreement has been finalized
between and among Black Warrior, Bobcat, and its principals, and there is no
assurance that such agreement will be finalized, if we are to timely close the
Bobcat transaction, it is necessary that we move forward with documentation of
the credit facilities which are needed for this closing. The Bobcat transaction
would close early to mid December 2005, well in advance of the recapitalization
described in the Recapitalization Letter. Therefore, to put in place the credit
facilities needed to close the Bobcat transaction, it is necessary that we
obtain your consent and concurrence as described herein.
The acquisition of Bobcat would be financed through a credit facility
with General Electric Capital Corporation and it affiliates ("GECC") by which
GECC would refinance its existing credit facility with Black Warrior, which is
the first lien credit facility, and would in addition provide a second lien term
loan. It is contemplated that the credit facility would include a $15 Million
senior secured revolving credit facility, a $30 Million senior secured term
loan, a $5 Million capital expenditures loan.
We need your immediate attention to this matter in order that we can
move forward with the closing of the Bobcat transaction. We need your
documentation returned by November 21, 2005. A return envelope is provided for
your convenience. Please sign and return one of the enclosed Acceptance and
Consent forms by November 21 and keep one copy for your records.
Very Truly Yours,
Black Warrior Wireline Corp.
By: /s/ William L. Jenkins
--------------------------------
William L. Jenkins, President
Enclosures: Two Acceptance and Consent Forms
Return Envelope
11