UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

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): March 14, 2005

NATURAL GAS SERVICES GROUP, INC.

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:

Table of Contents

Item 2.03 Creation of a Direct Financial Obligation or an Obligation Under an Off- Balance Sheet Arrangement of a Registrant

     On March 14, 2005, Natural Gas Services Group, Inc. entered into a Fourth Amended and Restated Loan Agreement, dated as of March 14, 2005, with Western National Bank. We entered into the Fourth Amended and Restated Loan Agreement for the purpose of being able to borrow additional funds with which to construct natural gas compressors, refinance certain existing indebtedness and for purchasing vehicles. Under this loan agreement, Western National Bank extended additional credit to us as evidenced by the following two promissory notes:

     The obligations referred to above are in addition to our other financial obligations to Western National Bank, which were incurred prior to entering into the Fourth Amended and Restated Loan Agreement, but which remain outstanding and subject to the terms and conditions of the Fourth Amended and Restated Loan Agreement. These other obligations are evidenced by the following promissory notes:

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outstanding principal balance of which was approximately $9,399,999 on March 16, 2005;

     As amended and restated, the loan agreement provides for a combination of term loans, multiple advance term loans and a revolving loan. The revolving loan permits us to borrow, repay and reborrow funds drawn under the Revolving Line of Credit Promissory Note described above.

     Generally, the amounts available for borrowing under each of the “advance” type notes and the revolving line of credit note are subject to a limitation equal to the lesser of (i) the face amount of the applicable note and (ii) a borrowing base amount. The borrowing base amount is based on a percentage of the values of our accounts receivable, lease receivables, equipment, work in process and inventory, less the outstanding principal balances of the other notes. At the end of each month, we provide a borrowing base report to the bank setting forth our calculation of the borrowing base amount. The bank may, but is not obligated to, redetermine the borrowing base in its sole discretion. If the bank does not redetermine the borrowing base, the amount of the borrowing base set forth in the borrowing base report furnished by us to the bank at the end of each month is deemed to be the redetermined borrowing base, until the bank gives notice to us of a new borrowing base. At March 16, 2005, the borrowing base was $23,020,142, and our total outstanding indebtedness under the Fourth Amended and Restated Loan Agreement was approximately $23,729,952.

     If the total outstanding indebtedness under all notes (excluding the Term Promissory Note in the amount of $1,415,836 made by Screw Compression Systems, Inc.) at any time exceeds the borrowing base at such time, we must, within fifteen business days after notice from the bank, first prepay the principal of the revolving line of credit promissory note in an aggregate amount at least equal to such excess, together with accrued interest on the amount prepaid to the date of such prepayment and, to the extent the excess is not eliminated by the prepayment of the revolving line of credit promissory note, we must next prepay the principal of the $10,000,000 Advance Term Note, the $10,000,000.00 Multiple Advance Term Promissory Note, the $1,500,000.00 Multiple Advance Term Promissory Note, the $7,521,109.00 Term Promissory Note, the $8,000,000.00 Term Promissory Note, and the $1,415,836 Term Promissory Note, in that order, in an aggregate amount equal to the remaining unpaid excess amount.

     The maturity date of our outstanding loans may be accelerated by the bank upon the occurrence of an event of default under the loan agreement. Generally, the events of default specified in the loan agreement include:

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     Screw Compression Systems, Inc., a subsidiary of Natural Gas Services Group, Inc., has guaranteed payment of the loans to Natural Gas Services Group, Inc.

     Our indebtedness to the bank is secured by substantially all of our assets.

     In addition to customary affirmative covenants, the Fourth Amended and Restated Loan Agreement contains various restrictive covenants and compliance requirements. Among these restrictions are limitations on our ability to:

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The Fourth Amended and Restated Loan Agreement also requires that we have:

Item 9.01. Financial Statements and Exhibits.

(c) Exhibits

The Exhibits listed below are filed as Exhibits to this Current Report on Form 8-K.

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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.

Dated: March 18, 2005

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EXHIBIT INDEX

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