Subordinated Note Restructuring Agreement

EXECUTION COPY


SECOND AMENDMENT, CONSENT AND WAIVER
TO
SUBORDINATED NOTE RESTRUCTURING AGREEMENT


Second Amendment, Consent and Waiver (this "Amendment"), effective as of June 29, 2002, to the Subordinated Note Restructuring Agreement, dated as of December 28, 2000 (as amended to the date hereof, the "Restructuring Agreement"), among Boots & Coots International Well Control Inc., a Delaware corporation, (the "Company") and The Prudential Insurance Company of America ("Prudential"), as amended by the Amendment, Consent and Waiver dated as of March 29, 2002 among the Company and Prudential (the "First Amendment"). Capitalized terms used herein but not defined herein are used as defined in the Restructuring Agreement.


W i t n e s s e t h:


Whereas, the Company and Prudential are party to the Restructuring Agreement pursuant to which Prudential agreed to cancel and terminate certain 11.28% Notes and the Warrant in consideration for the Company's fulfillment of its obligations set forth in the Restructuring Agreement and the issuance by the Company of Replacement Notes, the Replacement Warrant, the New Warrant, and the Preferred Stock;


Whereas, the Company has notified Prudential that the Company may not be in compliance with certain financial covenants under Sections 7.1(a) and 7.1(b) of the Restructuring Agreement (collectively, the "Specified Covenants") for the twelve month period ended June 30, 2002 (the "Specified Period"), which would constitute Events of Default pursuant to Section 8.1(xviii) of the Restructuring Agreement if not waived or deemed cured as provided therein (such Events of Default, the "Prospective Events of Default");


Whereas, the Company has requested that Prudential waive the Prospective Events of Default and compliance with the Specified Covenants for the Specified Period, to, effective the satisfaction of the conditions set forth in Section 2 hereof date hereof and (b) amend Sections 1.2, 7.3(a), 7.3(b) and 11 of the Restructuring Agreement as set forth herein; and


Whereas, Prudential agrees, subject to the limitations and conditions set forth herein, to (a) waive the Prospective Events of Default and compliance with the Specified Covenants for the Specified Period and (b) amend the Restructuring Agreement as set forth herein.


Now, Therefore, in consideration of the premises and the covenants and obligations contained herein the parties hereto agree as follows:


SECTION 1. CONSENT AND WAIVER


(a) Effective as of the date hereof, subject to the satisfaction (or due waiver) of the conditions set forth in Section 3 (Conditions to the Continued Effectiveness of this Amendment) hereof, Prudential hereby waives the following:


(i) the Prospective Events of Default; provided, however, that the waiver set forth in this clause (i) shall not excuse any failure to comply after the date hereof with the Restructuring Agreement as amended hereby; and


(ii) compliance for the Specified Period with the Specified Covenants.


SECTION 2. AMENDMENTS TO THE RESTRUCTURING AGREEMENT


The Restructuring Agreement is, effective as of the date hereof and subject to the satisfaction (or due waiver) of the conditions set forth in Section 3 (Conditions to the Continued Effectiveness of this Amendment) hereof, hereby amended as follows:


(a) AMENDMENTS TO SECTION 6 (AFFIRMATIVE COVENANTS)


(i) Section 6.2 (Financial Statements) of the Restructuring Agreement is hereby amended by:


(1) deleting the "and" at the end of clause (ix);


(2) removing the "(x)" in clause (x) and replacing it with "(xi)";


(3) inserting the following new clause (x) immediately following clause (ix):


"(x) by not later than 4:30 p.m. Eastern time, Tuesday, September 17, 2002 and continuing by the same time for each Tuesday thereafter, a detailed report in electronic form projecting the Company's consolidated cash flow for the 13 weeks following the date of such report; and".


SECTION 3. CONDITIONS TO THE CONTINUED EFFECTIVENESS OF THIS AMENDMENT


This Amendment shall be effective as of the date hereof, provided that each of the following conditions shall have been satisfied by the Company on or before the date specified below (the "Termination Date") or duly waived by Prudential:


(a) on or before August 30, 2002:


(i) First Waiver Fee. In partial consideration of this Amendment, Prudential shall have received the sum of $18,333 in immediately available funds by wire transfer to the following account (the "Wiring Account"):


Bank of New York
New York, NY
Account Name: Prudential Managed Account
ABA #021-00-018
Acct. #890-0304-391


(ii) Certain Documents. Prudential shall have received each of the following, each dated on or before the Termination Date (unless otherwise agreed by Prudential), in form and substance satisfactory to Prudential:


(1) this Amendment, duly executed by the Company and each domestic subsidiary of the Company, with the exception of ITS Supply Corporation, (collectively, the "Domestic Subsidiaries");


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(2) a subordinated note in the aggregate principal amount of $76,111.83 from the Company, in form and substance acceptable to Prudential, for the payment of certain outstanding legal fees which the Company is required to pay to Prudential pursuant to the Restructuring Agreement;


(3) a certificate of the Secretary or an Assistant Secretary of the Company certifying the names and true signatures of each officer of the Company who has been authorized to execute and deliver this Amendment or other document required hereunder to be executed and delivered by or on behalf of the Company; and


(iii) such additional documentation as Prudential may reasonably req ...