Exhibit 10.1


 


AMENDMENT TO


AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT AND


AMENDED AND RESTATED PROMISSORY NOTE


 


THIS AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT AND
AMENDED AND RESTATED PROMISSORY NOTE (this “Amendment”) dated as of SEPTEMBER 16, 2010 (the “Effective Date”),
is by and between SOVEREIGN BANK, a Texas state bank (together with
its successors and assigns, “Lender”)
and TGC INDUSTRIES, INC., a Texas
corporation (“Debtor”).


 


RECITALS


 


WHEREAS,  Debtor and
Lender entered into that certain AMENDED AND RESTATED LOAN
AND SECURITY AGREEMENT dated as of  SEPTEMBER 16, 2009 (as
amended, modified, and restated from time to time, the “Agreement”), pursuant to which Lender
agreed to make certain credit facilities available to Debtor on the terms and
conditions set forth therein; and


 


WHEREAS, Debtor has executed and delivered to Lender that
certain AMENDED AND RESTATED PROMISSORY NOTE dated
as of SEPTEMBER 16, 2009 (as
amended, modified, and restated from time to time, the “Revolving Credit Note”) in the
principal amount of FIVE MILLION AND NO/100
DOLLARS ($5,000,000.00); and


 


WHEREAS, the parties desire to amend the Agreement and the
Revolving Credit Note pursuant to the terms and conditions set forth herein;


 


NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:


 


1.                                       Defined Terms. 
Capitalized terms used in this Amendment, to the extent not otherwise
defined herein, shall have the same meanings as in the Agreement, as amended
hereby.  Notwithstanding the foregoing, Section 1(d) and
Section 1(n) of the Agreement are hereby amended in their
entirety to read as follows:


 


(d)                                 “Collateral” means:


 


(i)                                     All
present and future accounts now owned or hereafter acquired;


 


(ii)                                  The
equipment indentified on Exhibit 1(d) attached hereto,
together with all replacements, accessories, additions, substitutions and
accessions to all of the foregoing (collectively, the “Geospace
Equipment”);


 


(iii)                               All
books, records, data, plans, manuals, computer software, computer tapes,
computer systems, computer disks, computer programs, source codes and object
codes containing any information, pertaining directly or indirectly to the
Collateral described in clause (i) or (ii) above, as applicable, and
all rights to retrieve data and other information pertaining directly or
indirectly to the Collateral described in clause (i) or (ii) above,
as applicable from third parties; and


 


(iv)                              All SUPPORTING OBLIGATIONS, PRODUCTS and PROCEEDS of all of the foregoing, as applicable (including
without limitation, insurance payable by reason of loss or damage to the
foregoing property).


 


***


 


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(n)                                 “Note” means, individually and
collectively, any promissory note (including, but not limited to, (i) the AMENDED AND RESTATED PROMISSORY NOTE dated
as of SEPTEMBER 16, 2009 in the
principal amount of FIVE MILLION AND NO/100
DOLLARS ($5,000,000.00) executed by Debtor and payable to the order
of Lender (as such promissory note may be amended, modified or restated from
time to time, the “Revolving Credit Note”),
and (ii) the PROMISSORY NOTE dated
as of SEPTEMBER 16, 2010 in the
principal amount of ONE MILLION NINE HUNDRED
EIGHTY-EIGHT THOUSAND NINE HUNDRED TEN AND NO/100 DOLLARS ($1,988,910.00)
executed by Debtor and payable to the order of Lender (as such promissory note
may be amended, modified or restated from time to time, the “Term Note”).


 


2.                                       Amendment to Section 2 of Agreement.  Section 2 of the Agreement is
hereby amended in its entirety to read as follows:


 


2.                                       Credit Facility.


 


(a)                                  Establishment of Credit Facility.  Subject to the terms and conditions
set forth in this Agreement and the other Loan Documents, Lender hereby agrees
to lend to Debtor an aggregate sum not to exceed the lesser of (i) an amount equal to the
Borrowing Base, or (ii) FIVE MILLION AND
NO/100 DOLLARS ($5,000,000.00) (the “Revolving
Credit
Facility”),
on a revolving basis from time to time during the period commencing on the date
hereof and continuing until: (i) the acceleration of the Indebtedness
pursuant to the terms of the Loan Documents; (ii) SEPTEMBER 16, 2011; or (iii) such other date as may be
established by a written instrument between Debtor and Lender from time to time
(the “Revolving Credit Maturity Date”).  If at any time the sum of the aggregate
principal amount of Loans outstanding hereunder exceeds lesser of the Revolving Credit
Facility or the Borrowing Base, such amounts shall be deemed an “Overadvance.”  Debtor shall immediately repay the amount of
such Overadvance plus all
accrued and unpaid interest thereon upon written demand from Lender.  Notwithstanding anything contained herein to
the contrary, an Overadvance shall be considered a Loan and shall bear interest
at the Rate as set forth in the Revolving Credit Note and be secured by this
Agreement.  Subject to the terms and
conditions hereof, Debtor may borrow, repay and reborrow funds under the
Revolving Credit Facility.


 


(b)                                 Certain Defined Terms Relating to the
Revolving Credit Facility.  With
respect to Loans under Revolving Credit Facility, the following terms shall
have the following meanings:


 


(i)                                     “Borrowing Base” means a sum equal to
up to: EIGHTY PERCENT (80.00%)
of the amount of Debtor’s Eligible Accounts, provided, however, Lender shall
have the right to create and adjust eligibility standards and related reserves
from time to time in its reasonable credit judgment with respect to Debtor’s
Eligible Accounts.


 


(ii)                                  “Eligible Accounts” means, at any time,
all accounts receivable of Debtor, created in the ordinary course of business
that are acceptable to the Lender in its sole discretion and satisfy the
following conditions:


 


(1)                                  The account complies with all applicable laws,
rules, and regulations;


 


(2)                                  The account has not been outstanding for more
than NINETY (90) days past the
original date of invoice;


 


(3)                                  The account does not represent a commission
and the account was created under an enforceable contract in connection with (A) the
sale of goods by Debtor in the ordinary course of business and such sale has
been consummated and such goods have been shipped and delivered and received by
the account debtor, or (B) the performance of services by Debtor in the
ordinary course of business and such account was created in accordance with the
terms of the contract between Debtor and the account debtor and accepted by the
account debtor;


 


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(4)                                  The account does not arise from the sale of
any good that is on a bill-and-hold, guaranteed sale, sale-or-return, sale on
approval, consignment, or any other repurchase or return basis;


 


(5)                                  Debtor has good and indefeasible title to the
account and the account is not subject to any lien except liens in favor of the
Lender;


 


(6)                                  The account does not arise out of a contract
with or order from, an account debtor that, by its terms, prohibits or makes
void or unenforceable the grant of a security interest by Debtor to the Lender
in and to such account;


 


(7)                                  The account is not subject to any setoff,
counterclaim, defense, dispute, recoupment, or adjustment other than normal
discounts for prompt payment;


 


(8)                                  The account debtor is not insolvent or the
subject of any bankruptcy or insolvency proceeding and has not made an assignment
for the benefit of creditors, suspended normal business operations, dissolved,
liquidated, terminated its existence, ceased to pay its debts as they become
due, or suffered a receiver or trustee to be appointed for any of its assets or
affairs;


 


(9)                                  The account is not evidenced by chattel paper
or an instrument;


 


(10)                            No default exists under the account by any
party thereto;


 


(11)                            The account debtor has not returned or refused
to retain, or otherwise notified Debtor of any dispute concerning, or claimed
nonconformity of, any of the goods from the sale of which the account arose;


 


(12)                            The account is not owed by an Affiliate,
employee, officer, director or equity holder of Debtor;


 


(13)                            The account is payable in U.S. Dollars by the
account debtor;


 


(14)                            The account shall be ineligible if the account
debtor is domiciled in any country other than the United States of America;


 


(15)                            The account shall be ineligible if the account
debtor is the United States of America or any department, agency, or
instrumentality thereof, and the Federal Assignment of Claims Act of 1940, as
amended, shall not have been complied with;


 


(16)                            The account is otherwise acceptable in the
sole discretion of the Lender.


 


The amount of the Eligible
Accounts owed by an account debtor to Debtor shall be reduced by the amount of
all “contra accounts” and other obligations owed by Debtor to such account
debtor.  In the event that Lender, at any
time in its reasonable discretion, determines that the dollar amount of
Eligible Accounts collectable by Debtor is reduced or diluted as a result of
discounts or rebates granted by Debtor, returned, rejected or disputed goods or
services, or such other reasons or factors as Lender deems applicable, Lender
may reduce or otherwise modify the percentage of Eligible Accounts included
within Borrowing Base, and/or reduce the dollar amount of Debtor’s Eligible
Accounts by an amount determined by Lender in its reasonable discretion.


 


(c)                                  Term Loan Facility.  Subject to the terms and conditions set forth
in this Agreement and the other Loan Documents, Lender hereby agrees to lend to
Debtor in a single advance an aggregate sum not to exceed ONE MILLION NINE HUNDRED EIGHTY-EIGHT THOUSAND NINE HUNDRED TEN AND
NO/100 DOLLARS ($1,988,910.00)  (the “Term Loan Facility”) on SEPTEMBER 16, 2010 and continuing until:
(i)  the acceleration of the Indebtedness pursuant to the terms of the
Loan Documents;


 


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(ii) SEPTEMBER 16, 2013; or (iii) such
other date as may be established by a written instrument between Debtor and
Lender from time to time (the “Term
Maturity Date”).


 


(d)                                 Funding.  Lender
reserves the right to require not less than ONE
(1) Business Day prior notice of each Loan under the Revolving
Credit Facility, specifying the aggregate amount of such Loan together with any
documentation relating thereto as Lender may reasonably request; including, but
not limited to, a Borrowing Base report. 
Debtor shall give Lender notice of each Loan under the Revolving Credit
Facility by no later than 1:00 p.m. (Dallas, Texas time) on the date
provided herein.  Lender at its option
may accept telephonic requests for such Loan, provided that such acceptance
shall not constitute a waiver of Lender’s right to require delivery of a
written request in connection with subsequent Loans.  Lender shall have no liability to Debtor for
any loss or damage suffered by Debtor as a result of Lender’s honoring of any
requests, execution of any instructions, authorizations or agreements or
reliance on any reports communicated to it telephonically, by facsimile or
electronically and purporting to have been sent to Lender by Debtor and Lender
shall have no duty to verify the origin of any such communication or the
identity or authority of the Person sending it. 
Subject to the terms and conditions of this Agreement, each Loan under
this section shall be made available to Debtor by depositing the same, in
immediately available funds, in an account of Debtor designated by Debtor or by
paying the proceeds of such Loan to a third party designated by Debtor.


 


(e)                                  Use of Proceeds.  The
Loans under the Revolving Credit Facility shall be used by Debtor solely for
business operations.  The Loan under the
Term Facility shall be used by Debtor for the purchase of the Geospace Equipment.


 


3.                                       Amendment to Section 3 of Agreement.  Section 3 of the Agreement is
hereby amended in its entirety to read as follows:


 


3.                                       Promissory Notes, Rate and Computation of Interest.  (i) The Revolving Credit Facility shall
be evidenced by the Revolving Credit
Note, and (ii) the Term Loan Facility shall be evidenced by the Term Note.  Interest on each Note shall accrue at the
rates set forth therein.  The principal
of and interest on each Note shall be due and payable in accordance with the terms
and conditions set forth in such Note and in this Agreement.


 


4.                                       Amendment to Section 4(a) of Agreement.  Lender and Debtor agree that (a) a
separate and distinct portion of the Collateral shall secure the Revolving
Credit Facility, and (b) a separate and distinct portion of the Collateral
shall secure the Term Loan Facility. 
Accordingly, Section 4(a) of the Agreement is hereby
amended in its entirety to read as follows:


 


(a)                                  Grant of Security Interest.  As
collateral security for the prompt payment in full when due (whether at stated
maturity, by acceleration or otherwise) of the Indebtedness arising under the
Revolving Credit Facility, Debtor hereby re-pledges to and re-grants Lender, a
security interest in, all of Debtor’s right, title and interest in the
Collateral described in Sections 1(d)(i), (ii) and (iv),
whether now owned by Debtor or hereafter acquired and whether now existing or
hereafter coming into existence.  As
collateral security for the prompt payment in full when due (whether at stated
maturity, by acceleration or otherwise) of the Indebtedness arising under the
Term Loan Facility, Debtor hereby pledges to and grants Lender, a security
interest in, all of Debtor’s right, title and interest in the Collateral
described in Section 1(d)(ii), (iii) and (iv),
whether now owned by Debtor or hereafter acquired and whether now existing or
hereafter coming into existence.


 


5.                                       Addition of Exhibit 1(d) to Agreement.  Exhibit 1(d) is hereby added
to the Agreement in the form attached hereto.


 


6.                                       Extension of Maturity Date of Revolving Credit Note.  The term “Maturity Date” as used in the
Revolving Credit Note shall mean: “the earlier of (i) the acceleration of
the Indebtedness pursuant to the terms of the Loan Documents; (ii) SEPTEMBER 16, 2011; or (iii) such
other date as may be established by a written instrument between Debtor and
Lender from time to time.”


 


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7.                                       Conditions
Precedent.  The obligations of Lender under this
Amendment shall be subject to the condition precedent that Debtor shall have
executed and delivered to Lender this Amendment and such other documents and
instruments incidental and appropriate to the transaction provided for herein
as Lender or its counsel may reasonably request, including, without limitation,
the Term Note.


 


8.                                       Payment
Expenses.  Debtor agrees to pay all reasonable
attorneys’ fees of Lender in connection with the drafting and execution of this
Amendment.


 


9.                                       Ratifications. 
Except as expressly modified and superseded by this Amendment, the
Agreement, the Revolving Credit Note and the other Loan Documents are ratified
and confirmed and continue in full force and effect.  The Loan Documents, as modified by this
Amendment, continue to be legal, valid, binding and enforceable in accordance
with their respective terms.  Without
limiting the generality of the foregoing, Debtor hereby ratifies and confirms
that all liens heretofore granted to Lender were intended to, do and continue
to secure the full payment and performance of the indebtedness arising under
the Loan Documents.  Debtor agrees to
perform such acts and duly authorize, execute, acknowledge, deliver, file and
record such additional assignments, security agreements, modifications or
agreements to any of the foregoing, and such other agreements, documents and
instruments as Lender may reasonably request in order to perfect and protect
those liens and preserve and protect the rights of Lender in respect of all
present and future collateral.  The
terms, conditions and provisions of the Loan Documents (as the same may have
been amended, modified or restated from time to time) are incorporated herein
by reference, the same as if stated verbatim herein.


 


10.                                 Representations, Warranties and Confirmations.  Debtor hereby represents and warrants to
Lender that (a) this Amendment and any other Loan Documents to be
delivered under this Amendment (if any) have been duly executed and delivered
by Debtor, are valid and binding upon Debtor and are enforceable against Debtor
in accordance with their terms, except as limited by any applicable bankruptcy,
insolvency or similar laws of general application relating to the enforcement
of creditors’ rights and except to the extent specific remedies may generally
be limited by equitable principles, (b) no action of, or filing with, any
governmental authority is required to authorize, or is otherwise required in
connection with, the execution, delivery and performance by Debtor of this
Amendment or any other Loan Document to be delivered under this Amendment, and (c) the
execution, delivery and performance by Debtor of this Amendment and any other
Loan Documents to be delivered under this Amendment do not require the consent
of any other person and do not and will not constitute a violation of any laws,
agreements or understandings to which Debtor is a party or by which Debtor is
bound.


 


11.                                 Release.  Debtor hereby acknowledges and
agrees that there are no defenses, counterclaims, offsets, cross-complaints,
claims or demands of any kind or nature whatsoever to or against Lender or the
terms and provisions of or the obligations of Debtor under the Loan Documents
and the other agreements, instruments and documents evidencing, securing,
governing, guaranteeing or pertaining thereto, and that Debtor has no right to
seek affirmative relief or damages of any kind or nature from Lender.  To the extent any such defenses,
counterclaims, offsets, cross-complaints, claims, demands or rights exist,
Debtor hereby waives, and hereby knowingly and voluntarily releases and forever
discharges Lender and its predecessors, officers, directors, agents, attorneys,
employees, successors and assigns, from all possible claims, demands, actions,
causes of action, defenses, counterclaims, offsets, cross-complaints, damages,
costs, expenses and liabilities whatsoever, whether known or unknown, such
waiver and release being with full knowledge and understanding of the
circumstances and effects of such waiver and release and after having consulted
legal counsel with respect thereto.


 


12.                                 Multiple
Counterparts.  This
Amendment may be executed in a number of identical separate counterparts, each
of which for all purposes is to be deemed an original, but all of which shall
constitute, collectively, one agreement. 
Signature pages to this Amendment may be detached from multiple
separate counterparts and attached to the same document and a telecopy or other facsimile of any such executed
signature page shall be valid as an original.


 


13.                                 Reference
to Loan Documents.  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 containing a reference to any Loan Document shall
mean and refer to such Loan Document as amended hereby.


 


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14.                                 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.


 


15.                                 Headings.  The headings, captions, and arrangements used
in this Amendment are for convenience only and shall not affect the interpretation of this Amendment.


 


NOTICE OF FINAL AGREEMENT


 


THE AGREEMENT, THE REVOLVING CREDIT NOTE, THE TERM NOTE, AND THE OTHER
LOAN DOCUMENTS, AS THE SAME MAY BE AMENDED BY THIS AMENDMENT REPRESENT THE
FINAL AGREEMENT BETWEEN AND AMONG THE PARTIES AND MAY NOT BE CONTRADICTED
BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES.  THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN AND AMONG THE PARTIES.


 


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IN WITNESS WHEREOF, the parties
have caused this Amendment to be duly executed as of the date first written
above.


 


	
  LENDER:

  	
   

  	
  ADDRESS:

  
	
   

  	
   

  	
   

  
	
  SOVEREIGN
  BANK

  	
   

  	
  6060
  Sherry Lane

  
	
   

  	
   

  	
  Dallas,
  TX 75225

  
	
  By:

  	
  /s/Stephanie Baird
  Velasquez

  	
   

  	
   

  
	
  Name:

  	
  Stephanie Baird Velasquez

  	
   

  	
   

  
	
  Title:

  	
  Area President

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  With
  copies of notices to:

  	
   

  	
  GARDERE WYNNE SEWELL LLP

  
	
   

  	
   

  	
  1601 Elm Street,
  Suite 3000

  
	
   

  	
   

  	
  Dallas, TX 75201-4761

  
	
   

  	
   

  	
  Attention:                                         Steven S.
  Camp

  
	
   

  	
   

  	
   

  
	
  DEBTOR:

  	
   

  	
  ADDRESS:

  
	
   

  	
   

  	
   

  
	
  TGC INDUSTRIES, INC.

  	
   

  	
  101 E. Park Blvd.,
  Suite 955

  
	
   

  	
   

  	
  Plano, TX 75074

  
	
  By:

  	
  /s/ Wayne Whitener

  	
   

  	
   

  
	
  Name:

  	
  Wayne Whitener

  	
   

  	
   

  
	
  Title:

  	
  President & CEO

  	
   

  	
   

  



 


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Exhibit 1(d)


Geospace Equipment


 


The items described in Section 1.1, Section 2.1
and Section 3.1 of Page 2 of the attached Quotation No. 0810-7795
Rev 1 from Geospace Technologies submitted to Wayne A. Whitener.


 


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