Exhibit 10.1

 

SEVENTH AMENDMENT TO LOAN AGREEMENT

 

THIS SEVENTH AMENDMENT TO LOAN AGREEMENT (this “Amendment”), dated as of
February 28, 2004, is between CONCORD TECHNOLOGIES, LP, a Texas limited
partnership (“Concord”), GEOSPACE ENGINEERING RESOURCES INTERNATIONAL, LP, a
Texas limited partnership (“Engineering”), GEOSPACE TECHNOLOGIES, LP, a Texas
limited partnership, formerly known as Geo Space, LP (“Geo Space”), OYO
INSTRUMENTS, LP, a Texas limited partnership (“Instruments”), and OYOG
OPERATIONS, LP, a Texas limited partnership (“Operations”, and together with
Concord, Engineering, Geo Space and Instruments, the “Borrowers”), jointly and
severally, and SOUTHWEST BANK OF TEXAS, N.A., a national banking association
(“Lender”).

 

RECITALS:

 

A. Geo Space was formerly named Geo Space, LP. On March 5, 2003, Geo Space
changed its name from “Geo Space, LP” to “Geospace Technologies, LP.”

 

B. Borrowers and Lender entered into that certain Loan Agreement dated as of
February 16, 2001, as amended by First Amendment to Loan Agreement dated as of
February 17, 2001, Second Amendment to Loan Agreement dated as of January 15,
2002, Third Amendment to Loan Agreement dated as of January 14, 2003, Fourth
Amendment to Loan Agreement dated as of March 31, 2003, Fifth Amendment to Loan
Agreement dated as of December 5, 2003 and Sixth Amendment to Loan Agreement
dated as of January 13, 2004 (the “Agreement”).

 

C. Pursuant to the Agreement, OYOG, LLC, a Delaware limited liability company,
OYO Geospace Corporation, a Delaware corporation, and OYOG Limited Partner, LLC,
a Nevada limited liability company (“Guarantors”), executed those certain
Guaranty Agreements dated as of January 15, 2002 (the “Guaranty Agreements”),
pursuant to which Guarantors guaranteed to Lender the payment and performance of
the Obligations (as defined in the Agreement).

 

D. Borrowers and Lender now desire to amend the Agreement as herein set forth.

 

NOW, THEREFORE, in consideration of the premises herein contained and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

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ARTICLE I.

 

Definitions

 

Section I.1. Definitions. Capitalized terms used in this Amendment, to the
extent not otherwise defined herein, shall have the meanings given to such terms
in the Agreement, as amended hereby.

 

ARTICLE II.

 

Amendments

 

Section II.1. Amendment to Certain Definitions. (a) Effective as of January 1,
2004, the definition of the following terms contained in Section 1.1 of the
Agreement are amended to read in their respective entirety as follows:

 

“Applicable Rate” means (a) during the period that an Advance is a LIBOR
Advance, the sum of the LIBOR Rate plus two and one-half percent (2.50%), and
(b) during the period that an Advance is a Prime Rate Advance, the Prime Rate.

 

(b) Effective as of the date hereof, the definition of the following terms
contained in Section 1.1 of the Agreement are amended to read in their
respective entirety as follows:

 

“Termination Date-A” means 11:00 a.m., Houston, Texas time on February 27, 2005,
or such earlier date on which the Commitment-A terminates as provided in this
Agreement.

 

(c) Effective as of January 1, 2004, the following definitions shall be added to
Section 1.1 of the Agreement in proper alphabetical order:

 

“Current Assets” means, at any particular time, all amounts which, in conformity
with GAAP, would be included as current assets on a consolidated balance sheet
of Parent and its Subsidiaries.

 

“Current Liabilities” means, at any particular time, all amounts which, in
conformity with GAAP, would be included as current liabilities on a consolidated
balance sheet of Parent and its Subsidiaries.

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“Current Ratio” means the ratio of Current Assets to Current Liabilities.

 

“Ratio of Total Liabilities to Tangible Net Worth” means, as of any date, (a)
(i) Total Liabilities minus (ii) Subordinated Debt divided by (b) (i) Tangible
Net Worth plus (ii) Subordinated Debt.

 

“Total Liabilities” means, as of any date, all amounts which, in accordance with
GAAP, would be classified as liabilities on a consolidated balance sheet of
Parent and its Subsidiaries.

 

(d) Effective as of January 1, 2004, the definition of the following terms shall
be deleted from Section 1.1 of the Agreement:

 

“EBITDA”

“Interest Expense”

“Ratio of EBITDA to Interest Expense”

“Ratio of Senior Debt to EBITDA”

“Senior Debt”

 

Section II.2. Amendment to Article IX. Effective as of January 1, 2004, Sections
9.1, 9.2 and 9.3 contained in Article IX of the Agreement are amended to read in
their entirety as follows:

 

Section 9.1. Tangible Net Worth. Parent will at all times maintain Tangible Net
Worth in an amount not less than $45,000,000.00. Tangible Net Worth shall be
calculated and tested quarterly as of the last day of each fiscal quarter of
Parent.

 

Section 9.2. Current Ratio. Parent will at all times maintain a Current Ratio of
not less than 2.00 to 1.00. The Current Ratio shall be calculated and tested
quarterly as of the last day of each fiscal quarter of Borrower.

 

Section 9.3. Ratio of Total Liabilities to Tangible Net Worth. Parent will at
all times maintain a Ratio of Total Liabilities to Tangible Net Worth of not
greater than .50 to 1.00. The Ratio of Total Liabilities to Tangible Net Worth
shall be calculated and tested quarterly as of the last day of each fiscal
quarter of Parent.

 

Section II.3. Amendment to Exhibits. Exhibit “M” to the Agreement (No Default
Certificate) is amended to conform in its entirety to Annex “B” to this
Amendment.

 

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ARTICLE III.

 

Conditions Precedent

 

Section III.1. Conditions. The effectiveness of this Amendment is subject to the
receipt by Lender of the following in form and substance satisfactory to Lender:

 

(a) Certificate - Borrowers. A certificate of the Secretary or the Assistant
Secretary (or another officer acceptable to Lender) of each Borrower certifying
resolutions of the board of directors of the General Partner as general partner
of each Borrower which authorize the execution, delivery and performance by each
Borrower of this Amendment and the other Loan Documents to which such Person is
or is to be a party.

 

(b) Amendment to Security Agreements. A Second Amendment to Security Agreements
executed by Concord, Engineering, Instruments and Operations, respectively,
substantially in the form of Annexes “B”, “C”, “D”, “E” and a Third Amendment to
Security Agreement executed by Geo Space substantially in the form of Annex “F”
hereto.

 

(c) Additional Information. Such additional documents, instruments and
information as Lender may request.

 

Section III.2. Additional Conditions. The effectiveness of this Amendment is
also subject to the satisfaction of the additional conditions precedent that (a)
the representations and warranties contained herein and in all other Loan
Documents, as amended hereby, shall be true and correct as of the date hereof as
if made on the date hereof, (b) all proceedings, corporate or otherwise, taken
in connection with the transactions contemplated by this Amendment and all
documents, instruments and other legal matters incident thereto shall be
satisfactory to Lender.

 

ARTICLE IV.

 

Ratifications, Representations, and Warranties

 

Section IV.1. Ratifications. The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions set
forth in the Agreement and except as expressly modified and superseded by this
Amendment, the terms and provisions of the Agreement are ratified and confirmed
and shall continue in full force and effect. Borrowers and Lender agree that the
Agreement as amended hereby shall continue to be the legal, valid and binding

 

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obligation of such Persons enforceable against such Persons in accordance with
its terms.

 

Section IV.2. Representations, Warranties and Agreements. Each Borrower hereby
represents and warrants to Lender that (a) the execution, delivery, and
performance of this Amendment and any and all other Loan Documents executed or
delivered in connection herewith have been authorized by all requisite action on
the part of such Borrower and General Partner and will not violate the
Organizational Documents of such Borrower, (b) the representations and
warranties contained in the Agreement as amended hereby, and all other Loan
Documents are true and correct on and as of the date hereof as though made on
and as of the date hereof, (c) no Event of Default or Unmatured Event of Default
has occurred and is continuing, (d) Borrower is in full compliance with all
covenants and agreements contained in the Agreement as amended hereby, (e)
Borrower is indebted to Lender pursuant to the terms of Note-A, as the same may
have been renewed, modified, extended and rearranged, including, without
limitation, renewals, modifications and extensions made pursuant to this
Amendment, (f) the liens, security interests, encumbrances and assignments
created and evidenced by the Loan Documents are, respectively, valid and
subsisting liens, security interests, encumbrances and assignments and secure
Note-A as the same may have been renewed, modified or rearranged, including,
without limitation, renewals, modifications and extensions made pursuant to this
Amendment and (g) Borrower has no claims, credits, offsets, defenses or
counterclaims arising from the Loan Documents or Lender’s performance under the
Loan Documents.

 

ARTICLE V.

 

Miscellaneous

 

Section V.1. Reference to Agreement. Each of the Loan Documents, including the
Agreement and any and all other agreements, documents, or instruments now or
hereafter executed and delivered pursuant to the terms hereof or pursuant to the
terms of the Agreement, as amended hereby, are hereby amended so that any
reference in such Loan Documents to the Agreement shall mean a reference to the
Agreement, as amended hereby.

 

Section V.2. Severability. Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.

 

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Section V.3. APPLICABLE LAW. THIS AMENDMENT AND ALL OTHER LOAN DOCUMENTS
EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE
IN HOUSTON, HARRIS COUNTY, TEXAS AND SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.

 

Section V.4. Successors and Assigns. This Amendment is binding upon and shall
inure to the benefit of Lender and Borrowers and their respective successors and
assigns, except no Borrower may assign or transfer any of its rights or
obligations hereunder without the prior written consent of Lender.

 

Section V.5. Counterparts. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.

 

Section V.6. Effect of Waiver. No consent or waiver, express or implied, by
Lender to or for any breach of or deviation from any covenant, condition or duty
by Borrowers shall be deemed a consent or waiver to or of any other breach of
the same or any other covenant, condition or duty.

 

Section V.7. ENTIRE AGREEMENT. THIS AMENDMENT AND ALL OTHER INSTRUMENTS,
DOCUMENTS, AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH THIS
AMENDMENT EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO WITH
RESPECT TO THE SUBJECT MATTER HEREOF AND THEREOF AND SUPERSEDE ANY AND ALL PRIOR
COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR
ORAL, RELATING TO THE SUBJECT MATTER HEREOF AND THEREOF, AND MAY NOT BE
CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES HERETO.

 

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Executed as of the date first written above.

 

BORROWERS:

CONCORD TECHNOLOGIES, LP

By:

 

OYOG, LLC, its general partner

   

By:

 

/s/    Thomas T. McEntire

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        Thomas T. McEntire

       

        Vice President and

       

        Chief Financial Officer

GEOSPACE ENGINEERING RESOURCES

INTERNATIONAL, LP

By:

 

OYOG, LLC, its general partner

   

By:

 

/s/    Thomas T. McEntire

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        Thomas T. McEntire

       

        Vice President and

       

        Chief Financial Officer

GEOSPACE TECHNOLOGIES, LP

By:

 

OYOG, LLC, its general partner

   

By:

 

/s/    Thomas T. McEntire

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        Thomas T. McEntire

       

        Vice President and

       

        Chief Financial Officer

OYO INSTRUMENTS, LP

By:

 

OYOG, LLC, its general partner

 

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By:

 

/s/    Thomas T. McEntire

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        Thomas T. McEntire

       

        Vice President and

       

        Chief Financial Officer

OYOG OPERATIONS, LP

By:

 

OYOG, LLC, its general partner

   

By:

 

/s/    Thomas T. McEntire

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        Thomas T. McEntire

       

        Vice President and

       

        Chief Financial Officer

LENDER:

SOUTHWEST BANK OF TEXAS, N.A.

By:

 

/s/    Edward K. Bowdon

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        Edward K. Bowdon

   

        Vice President

 

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Each of the undersigned Guarantors hereby consents and agrees to this Amendment
and agrees that the Guaranty Agreement executed by such person shall remain in
full force and effect and shall continue to be the legal, valid and binding
obligations of such Guarantor, enforceable against such Guarantor in accordance
with its terms and shall evidence such Guarantor’s guaranty of Note-A, as
renewed and extended from time to time.

 

OYOG, LLC

By:

 

        /s/    Thomas T. McEntire

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        Thomas T. McEntire

   

        Vice President and

   

        Chief Financial Officer

OYOG LIMITED PARTNER, LLC

By:

 

        /s/    Thomas T. McEntire

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        Thomas T. McEntire

   

        Manager

OYO GEOSPACE CORPORATION

By:

 

        /s/    Thomas T. McEntire

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        Thomas T. McEntire

   

        Vice President and

   

        Chief Financial Officer

 

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