Document:

ex_344592.htm

Exhibit 10.3

 

FIRST AMENDMENT TO THE SECOND FORBEARANCE AND SEVENTH AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT

 

 

This FIRST AMENDMENT TO THE SECOND FORBEARANCE AND SEVENTH AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT (this “Agreement”), is made and entered into as of March 8, 2022 (the “Effective Date”), by and among ION GEOPHYSICAL CORPORATION, a Delaware corporation (“Geophysical”), ION EXPLORATION PRODUCTS (U.S.A.), INC., a Delaware corporation (“Exploration”), I/O MARINE SYSTEMS, INC., a Louisiana corporation (“Marine”), GX TECHNOLOGY CORPORATION, a Texas corporation (“GXT”), GX GEOSCIENCE CORPORATION, S. DE R.L. DE C.V., a Sociedad de Responsabilidad Limitada de Capital Variable organized under the laws of Mexico (“GX Geoscience” and, together with Geophysical, Exploration, Marine and GXT, collectively, the “Borrowers”, and each a “Borrower”), the financial institutions party hereto as lenders (collectively, the “Lenders” and each individually a “Lender”) and ANKURA TRUST COMPANY, LLC, a Delaware limited liability company (“Ankura”), as agent for Lenders (Ankura, in such capacity, together with its successors and assignees in such capacity, the “Agent”).

 

BACKGROUND

 

A.    On August 22, 2014, Borrowers, Lenders, and Agent entered into that certain Revolving Credit and Security Agreement (as amended, restated, amended and restated, extended, supplemented or otherwise modified prior to the date hereof, the “Credit Agreement”).

 

B.    On February 14, 2022, Borrowers, Agent, and Lenders entered into a Second Forbearance and Sixth Amendment to Revolving Credit and Security Agreement (“Second Forbearance”), pursuant to which, inter alia, Agent and Lenders agreed to forbear from accelerating the Obligations and exercising remedies under the Credit Agreement with respect to the Specified Default;

 

C.    Borrowers have requested that Agent and the Lenders (i) continue to forbear from accelerating the Obligations and exercising remedies under the Credit Agreement with respect to the Specified Default and (ii) modify certain terms and conditions hereafter set forth, and subject to the terms and conditions hereof, the Agent and Lenders are willing to do so; and

 

D.    Agent and the Lenders are willing to accommodate the Borrowers’ request subject to the terms and conditions herein. Accordingly, Agent, the Lenders and the Borrowers hereby agree as follows:

 

NOW, THEREFORE, for good and valuable consideration, the sufficiency and receipt of all of which are acknowledged, the Loan Parties, the Agent and the Lenders agree as follows:

 

 1.    Definitions, Generally. Except as expressly set forth herein, all capitalized terms used and not defined herein shall have the respective meanings ascribed thereto in the Credit Agreement.

 

 2.    Acknowledgements by Borrowers

 

(a)    Acknowledgment of Debt. As of the close of business on March 7, 2022, each Borrower is indebted, jointly and severally, to Lenders and Agent, without defense, deduction, setoff, claim or counterclaim, of any nature, under the Credit Agreement and the Other Documents in the aggregate principal amount of $15,600,000 in respect of the Advances, plus accrued and continually accruing interest, fees, costs and expenses;

 

(b)    Acknowledgment that Liabilities Continue in Full Force and Effect. That the Obligations and all other respective liabilities and obligations of the Borrowers under the Other Documents shall remain in full force and effect, and shall not be released, impaired, diminished or in any other way modified or amended as a result of the execution and delivery of this Agreement or by the agreements and undertakings of the parties contained herein; and

 

(c)    Acknowledgment of Perfection of Security Interest. As of the date hereof, the security interests and Liens granted to the Agent, for its benefit and the benefit of the Secured Parties, under the Credit Agreement and the Other Documents securing the Obligations are in full force and effect, are properly perfected and are enforceable in accordance with the terms of the Credit Agreement and the Other Documents.

 

 

 3.    Amendment to Second Forbearance. Effective as of the Effective Date, Section 3(a) of the Second Forbearance is hereby amended by deleting the date “March 8, 2022” and replacing the same with “April 4, 2022”.

 

 4.    Amendments to Credit Agreement. Effective as of the Effective Date, the Credit Agreement is hereby amended as follows:

 

(a)         All defined terms referencing PNC Bank, National Association as the Agent in the Credit Agreement and the Other Documents are hereby amended to reference Ankura as the Agent thereunder.

 

(b)         The definition of “Base Rate” in Section 1.2 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

 

“Base Rate” means the U.S. prime rate as shown in the Eastern Edition of The Wall Street Journal on such day, or, if such day is not a Business Day, on the immediately preceding Business Day (and, if the Eastern Edition of The Wall Street Journal for any reason ceases to publish a U.S. prime rate, then the Base Rate shall be such prime rate as published from time to time in any other publication or reference source designated by the Agent in its discretion); provided, that the Base Rate is a reference rate and does not necessarily represent the best or lowest rate charged by any Lender.

 

(c)         The definition of “Federal Funds Open Rate” in Section 1.2 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

 

“Federal Funds Open Rate” shall mean for any day the rate per annum (based on a year of 360 days and actual days elapsed) which is the daily federal funds open rate as quoted by ICAP North America, Inc. (or any successor) as set forth on the Bloomberg Screen BTMM for that day opposite the caption “OPEN” (or on such other substitute Bloomberg Screen that displays such rate) (or if such rate for such day does not appear on the Bloomberg Screen BTMM (or any substitute screen), or if there shall at any time, for any reason, no longer exist a Bloomberg Screen BTMM (or any substitute screen), a comparable replacement rate determined by the Agent at such time (which determination shall be conclusive absent manifest error); provided however, that if such day is not a Business Day, the Federal Funds Open Rate for such day shall be the “open” rate on the immediately preceding Business Day. If and when the Federal Funds Open Rate changes, the rate of interest with respect to any advance to which the Federal Funds Open Rate applies will change automatically without notice to Borrowers, effective on the date of any such change.

 

(d)         The definition of “Fee Letter” in Section 1.2 of the Credit Agreement is amended and restated in its entirety to read as follows:

 

“Fee Letter” shall mean the fee letter dated March 8, 2022, by and among the Borrowers and Ankura, as amended, restated, supplemented, or otherwise modified from time to time.

 

(e)         Section 1.2 of the Credit Agreement is hereby amended by deleting the definition of “PNC” therein and replacing it with the following new definition in the correct alphabetical order therein:

 

“Ankura” shall mean Ankura Trust Company, LLC, a Delaware limited liability company, and its successors and assigns.

 

(f)         The definition of “Issuer” in Section 1.2 of the Credit Agreement is amended and restated in its entirety to read as follows:

 

“Issuer” shall mean any lender that is an issuer of Letters of Credit hereunder.

 

(g)          The definition of “Swing Loan Lender” in Section 1.2 of the Credit Agreement is amended and restated in its entirety to read as follows:

 

“Swing Loan Lender” shall mean any lender of the Swing Loans hereunder.

 

(h)         Section 2.10 of the Credit Agreement is amended by deleting the second and third sentences of such section in their entirety.

 

(i)         Section 9.12 of the Credit Agreement is hereby deleted in its entirety.          

 

(j)         The “SECOND” clause in Section 11.5 of the Credit Agreement is amended and restated in its entirety to read as follows:

 

“SECOND, to payment of any fees, costs, expenses, indemnities, or other amounts then due to the Agent under the Credit Agreement and the Other Documents;”

 

(k)         The first sentence of Section 14.1 of the Credit Agreement is amended and restated in its entirety to read as follows:

 

“Appointment.          Each Lender hereby designates Ankura to act as Agent for such Lender under this Agreement and the Other Documents.”

 

(l)         The first and second sentences of Section 14.2 of the Credit Agreement is amended and restated in its entirety to read as follows:

 

“Notwithstanding any provision to the contrary contained elsewhere herein or in any Other Document, the Agent shall not have any duties or responsibilities, except those expressly set forth herein, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any Other Document or otherwise exist against the Agent. Neither Agent nor any of its members, managers, officers, directors, employees, agents, attorneys-in-fact, representatives, or advisors (the “Agent-Related Parties”) shall be (i) liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Agent shall believe in good faith shall be necessary), (ii) liable for any action taken or omitted by them as such hereunder or in connection herewith, unless caused by their gross (not mere) negligence or willful misconduct (as determined by a court of competent jurisdiction in a final nonappealable judgment) (which shall not include any action taken or omitted to be taken in accordance with clause (i), for which none of them shall have any liability), or (iii) responsible in any manner for or liable for or have any duty to ascertain or inquire into or monitor (a) any recitals, statements, representations or warranties made by any Loan Party or any officer thereof contained in this Agreement or in any of the Other Documents or in any certificate, report, statement or other document referred to or provided for in, or received by Agent under or in connection with, this Agreement or any of the Other Documents, (b) the value, validity, effectiveness, genuineness, due execution, enforceability or sufficiency of this Agreement or any of the Other Documents, (c) any failure of any Loan Party to perform its obligations hereunder or under any of the Other Documents, (d) the creation, preservation, perfection, maintenance or continuation of perfection, or priority of any Lien purported to be created by this Agreement or any of the Other Documents, (e) the value or the sufficiency of any Collateral, (f) whether the Collateral exists, is owned by the Loan Parties, is cared for, protected, or insured or has been encumbered, or meets the eligibility criteria applicable in respect thereof, or (g) the inspection of the properties, books or records of any Loan Party or any Affiliate thereof.”

 

(m)         A new Section 14.14 of the Credit Agreement is hereby added as follows:

 

14.14. Additional Agency Provisions.

 

“(a)         For the avoidance of doubt, and without limiting the other protections set forth in this Article XIV, with respect to any determination, designation, or judgment to be made by the Agent herein or in any Other Document, the Agent shall be entitled to request that the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Agent shall believe in good faith shall be necessary) make or confirm such determination, designation, or judgment.

 

(b)         The provisions of this Article XIV are solely for the benefit of the Agent, the Lenders, and the other Secured Parties, and no Loan Party has rights as a third party beneficiary of any of such provisions.

 

(c)         To the extent required by any applicable Law, the Agent may deduct or withhold from any payment to any Lender under this Agreement or any Other Document an amount equivalent to any applicable withholding Tax. If the Internal Revenue Service or any other Governmental Body asserts a claim that the Agent did not properly withhold Tax from amounts paid to or for the account of any Lender for any reason (including because the appropriate form was not delivered or was not properly executed or because such Lender failed to notify the Agent of a change in circumstance that rendered the exemption from, or reduction of, withholding Tax ineffective), such Lender shall indemnify and hold harmless the Agent fully for all amounts paid, directly or indirectly, by the Agent as Tax or otherwise, including any penalties, additions to Tax or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-pocket expenses) incurred, whether or not such Tax was correctly or legally imposed or asserted by the relevant Governmental Body. A certificate as to the amount of such payment or liability delivered to any Lender by the Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Agent to set off and apply any amounts at any time owing to such Lender under this Agreement or any Other Document against any amount due the Agent under this Section 14.14(c). For the avoidance of doubt, this Section 14.14(c) shall not limit the obligations of the Loan Parties under Section 3.10 or any other provision of this Agreement.

 

(d)         The agreements in this Article XIV shall survive the resignation of the Agent, the repayment, satisfaction or discharge of all the other Obligations, and the termination of this Agreement or any other Other Document.”

 

(n)         Clause 16.2(b)(vii) of the Credit Agreement is amended and restated in its entirety to read as follows:

 

“(vii)     change the rights or duties of, or any fees or other amounts payable to, the Agent under this Agreement or any Other Document without the written consent of the Agent;”

 

(o)         The first sentence of Section 16.3(b) is hereby amended by adding the following proviso at the end of such sentence:

 

“provided, further, that such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, and (C) the Borrowers, the Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.”

 

(p)         Clauses (1) and (2) of Section 16.5 are amended and restated in their entirety to read as follows:

 

“(1) the gross negligence or willful misconduct of the party to be indemnified, (2) other than with respect to Agent and its Indemnified Parties, any material breach (or, in the case of a proceeding brought by any Borrower, any breach) of this Agreement or any Other Document by the party to be indemnified or”

 

(q)         Section 16.6 to the Credit Agreement is amended to delete the notice information for PNC and to add the following:

 

(A)         If to Agent or Ankura at:

 

Ankura Trust Company, LLC

140 Sherman Street, 4th Floor

Fairfield, CT 06824

Attention:   Michael Fey, Beth Micena, Krista Gulalo

Email:         michael.fey@ankura.com; beth.micena@ankura.com; krista.gulalo@ankura.com

 

with a copy (which shall not constitute notice) to:

 

Ropes & Gray LLP

1211 Avenue of the Americas

New York, NY 10036

Attention:  Mark Somerstein

Email:        Mark.Somerstein@ropesgray.com

 

(r)         Section 16.6 to the Credit Agreement is amended to add the following new clauses (h) and (i):

 

“(h)         The Borrowers agree that the Agent may, but shall not be obligated to, make any notice, demand, communication, information, document or other material provided by or on behalf of any Loan Party pursuant to this Agreement or any Other Document or the transactions contemplated herein or therein (“Communications”) available to the Lenders by posting the Communications on IntraLinksTM, DebtDomain, SyndTrak, ClearPar or any other electronic platform chosen by the Agent to be its electronic transmission system (the “Platform”). Each of the Lenders and the Borrowers hereby approves distribution of the Communications through the Platform and understands and assumes the risks of such distribution. Each Lender agrees that notice to it (as provided in the next sentence) specifying that Communications have been posted to the Platform shall constitute effective delivery of the Communications to such Lender for purposes of this Agreement and any Other Document. Each Lender agrees (i) to notify the Agent in writing (which could be in the form of electronic communication) from time to time of such Lender’s email address to which the foregoing notice may be sent by electronic transmission and (ii) that the foregoing notice may be sent to such email address.          

 

“(i)         THE PLATFORM AND THE COMMUNICATIONS ARE PROVIDED “AS IS” AND “AS AVAILABLE”. THE AGENT-RELATED PARTIES DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE COMMUNICATIONS, OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS OR OMISSIONS IN THE PLATFORM AND THE COMMUNICATIONS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE AGENT-RELATED PARTIES IN CONNECTION WITH THE COMMUNICATIONS OR THE PLATFORM. IN NO EVENT SHALL ANY AGENT-RELATED PARTY HAVE ANY LIABILITY TO ANY LOAN PARTY, ANY LENDER OR ANY OTHER PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING DIRECT OR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF ANY LOAN PARTY’S OR THE AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET OR THE PLATFORM.”

 

(s)         Each reference to PNC in its capacity as Agent in the exhibits to the Credit Agreement and in the Other Documents is hereby deemed to refer to Ankura.

 

 5.    Conditions to Effectiveness of this Agreement. Notwithstanding any other provision of this Agreement and without affecting in any manner the rights of the Agent and Lenders hereunder, it is understood and agreed that this Agreement shall become effective, and the Borrowers shall have rights under this Agreement, upon the receipt by the Agent of each of the following:

 

(a)    Executed counterparts of this Agreement from Borrowers and the Lender;

 

(b)    Payment of all reasonable out-of-pocket costs and expenses of the Agent and Lenders in connection with the Borrowers and its Affiliates through the date of this Agreement, including, without limitation, in connection with the negotiation, preparation, execution and delivery of this Agreement, including, without limitation, the reasonable fees and out-of-pocket expenses of outside counsel and other outside advisors for the Agent and Lenders; and

 

(c)    The representations and warranties in this Agreement shall be true and correct on and as of such date with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties were true and correct in all respects as of such earlier date.

 

 6.    Representations and Warranties. To induce the Agent and Lenders to enter into this Agreement, each Borrower represents and warrants to the Agent and Lenders that:

 

(a)    Each Borrower and each Subsidiary (i) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (ii) has all requisite power and authority to carry on its business as now conducted and is qualified to do business in, and (iii) is in good standing in, every jurisdiction where such qualification is required, except where such failure in each case could not reasonably be expected to result in a Material Adverse Effect;

 

(b)    The execution, delivery and performance of this Agreement by such Borrower are within such Borrower’s organizational powers and have been duly authorized by all necessary organizational action and, if required, actions by equity holders;

 

(c)    The execution, delivery and performance of this Agreement by such Borrower (i) does not require any consent or approval of, registration or filing with, or any other action by, any Governmental Body, except (x) such as have been obtained or made and are in full force and effect, (y) filings necessary to perfect Liens created pursuant to the Other Documents and release existing liens, and (z) consents, approvals, registrations, filings or actions the failure of which to obtain or make could not reasonably be expected to result in a Material Adverse Effect, (ii) does not violate any Applicable Law except as could not reasonably be expected to result in a Material Adverse Effect, (iii) does not violate or result in a default under any Material Contract, or give rise to a right thereunder to require any payment to be made by any Borrower or any Subsidiary, and (iv) does not result in the creation or imposition of any Lien on any asset of any Borrower or any Subsidiary, except Liens created pursuant to the Other Documents or otherwise permitted thereunder;

 

(d)    This Agreement has been duly executed and delivered by such Borrower and constitutes a legal, valid and binding obligation of such Borrower, enforceable in accordance with its terms; and

 

(e)    After giving effect to this Agreement and any changes in facts and circumstances that are not prohibited by the terms of the Credit Agreement, the representations and warranties contained in the Credit Agreement and the Other Documents are true and correct in all material respects (without duplication of any materiality qualifier therein) as of the date hereof (except to the extent any such representations and warranties specifically relate to a specific date, in which case such representations and warranties were true and correct in all material respects (without duplication of any materiality qualifier therein) on and as of such other specific date.

 

 7.    Mutual Acknowledgement of Debt. Each of the parties hereto acknowledge and agree that Schedule 1 hereto sets forth, as of the close of business on March 7, 2022, (i) the list of all Lenders and the outstanding principal amount of, and accrued and unpaid interest on, the Advances owing to each such Lender under the Credit Agreement, (ii) the status of the Advances as Domestic Rate Loans and the status of the Revolving Commitments, (iii) the Alternate Base Rate applicable to the outstanding Domestic Rate Loans and whether the Default Rate has been imposed, and (iv) the amount of the fees owing to each Lender.  Schedule 1 shall constitute the Register as of the Effective Date, and the Agent shall be entitled to conclusively rely upon, and shall not incur any liability for relying upon Schedule 1, including, without limitation, for the purpose of making any calculation, determination, or distribution under the Credit Agreement and the Other Documents.

 

 8.    Effect of Agreement. Except as expressly set forth herein, this Agreement shall not, by implication or otherwise, limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of Agent or any Lender under the Credit Agreement or any Other Document, and, except as expressly set forth herein, this Agreement shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any Other Document, all of which are ratified and affirmed in all respects and shall continue in full force and effect. Nothing herein shall be deemed to entitle the Borrowers to a consent to, or a waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any Other Document in similar or different circumstances.

 

Except as set forth expressly herein, all terms of the Credit Agreement, as amended hereby, and the Other Documents shall be and remain in full force and effect and shall constitute the legal, valid, binding and enforceable obligations of the Borrowers to the Agent and Lenders. The execution, delivery and effectiveness of this Agreement shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Agent or Lenders under the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement and the Agent and Lenders require strict compliance with all of the terms and conditions of the Credit Agreement and each of the Other Documents in the future. It is expressly stated that the parties are not entering into a mutual disregard of the terms and provisions of any Other Document. This Agreement shall constitute an Other Document for all purposes of the Credit Agreement.

 

Nothing contained in this Agreement or any other communication between Agent and/or Lenders and any Borrower shall be a waiver of any past, present or future violation, Default or Event of Default of any Borrower under the Credit Agreement or any Other Document. Similarly, each Agent and Lender hereby expressly reserves any rights, privileges and remedies under the Credit Agreement and each Other Document that such Agent or Lender may have with respect to each violation, Default or Event of Default, and any failure by any Agent or Lender to exercise any right, privilege or remedy as a result of the violation set forth above shall not directly or indirectly in any way whatsoever either (i) impair, prejudice or otherwise adversely affect the rights of Agent or Lenders, except as set forth herein, at any time to exercise any right, privilege or remedy in connection with the Credit Agreement or any Other Document, (ii) amend or alter any provision of the Credit Agreement or any Other Document or any other contract or instrument, or (iii) constitute any course of conduct, course of dealing or other basis for altering any obligation of any Borrower or any rights, privilege or remedy of Agent or Lenders under the Credit Agreement or any Other Document or any other contract or instrument. Nothing in this Agreement shall be construed to be a consent by Agent or Lenders to any prior, existing or future violations of the Credit Agreement or any Other Document or to any other transaction involving any Borrower.

 

 9.    Ratification; Reaffirmation. Each of the Borrowers hereby restate, ratify and reaffirm each and every term, covenant and condition set forth in the Credit Agreement and the Other Documents effective as of the date hereof. Each of the Borrowers acknowledges and reaffirms that (i) all Liens granted to the Agent and Lenders under the Credit Agreement or any Other Documents remain in full force and effect and shall continue to secure the Obligations and (ii) the validity, perfection or priority of the Liens will not be impaired by this Agreement.

 

10.    Miscellaneous.

 

(a)    Governing Law; Waivers; Etc. After the date hereof, any reference to the “Credit Agreement” or the “Agreement” in the Credit Agreement or to the “Credit Agreement” in any Other Document, shall mean the Credit Agreement as modified hereby. This Agreement shall be subject to the provisions regarding interpretation, governing law, waiver of jury trial and special damages, jurisdiction and venue applicable to the Credit Agreement.

 

(b)    No Novation. Nothing in this Agreement shall be construed to constitute a novation of the Obligations or any other indebtedness arising under the Other Documents, related to the Obligations, or to release, satisfy, discharge or otherwise affect or impair in any manner whatsoever (i) the validity or enforceability of the Obligations or any other indebtedness arising under the Credit Agreement or any Other Document; (ii) the charges, liens, pledges, security interests, assignments and conveyances effected by the Credit Agreement and any other agreement securing the Obligations or any other obligations arising under the Credit Agreement or any Other Document, or the priority thereof; (iii) the liability of any Loan Party under the Credit Agreement and all Other Documents or any other Person that may now or hereafter be liable under the Credit Agreement and the Other Documents or any agreement securing the same; and (iv) any other security or instrument now or hereafter held by the Agent or any Lender as security for or as evidence of any of the above described indebtedness. Without limiting the foregoing, the Agent and each Lender hereby reserves any and all rights and remedies available to Agent and/or Lenders at law, in equity, by agreement (including under the Credit Agreement and all Other Documents), or otherwise.

 

(c)    Release. Each Borrower hereby acknowledges that it has no defense, counterclaim, offset, cross‐complaint, claim or demand of any kind or nature whatsoever that can be asserted to reduce or eliminate all or any part of its liability to repay any loans or extensions of credit from Agent and Lenders to such Borrower under the Credit Agreement or the Other Documents or to seek affirmative relief or damages of any kind or nature from Lenders and the Agent. Each Borrower hereby voluntarily and knowingly releases and forever discharges Lenders, the Agent, their predecessors, agents, employees, officers, directors, partners, servants representatives, attorneys, consultants, advisors, affiliates, successors and assigns (collectively, the “Released Parties”), from all possible claims, suits, debts, liens, losses, demands, actions, causes of action, rights, damages, costs, expenses, and liabilities of any kind, known or unknown, anticipated or unanticipated, suspected or unsuspected, fixed, contingent, or conditional, at law or in equity, originating in whole or in part on or before the effectiveness of this Agreement, which such Borrower may now or hereafter have against the Released Parties, if any, and irrespective of whether any such claims arise out of contract, tort, violation of law or regulations, or otherwise, and arising out of, relating to, or in connection with the Borrowers, Affiliates of the Borrowers, the lending relationship among the Secured Parties and Loan Parties, any action or inaction by any Secured Party, the Obligations, the Credit Agreement or the Other Documents to which such Person is a party, including, without limitation, any contracting for, charging, taking, reserving, collecting or receiving interest in excess of the highest lawful rate applicable, the exercise of any rights and remedies under the Credit Agreement or Other Documents, and negotiation for and execution of this Agreement (the “Released Claims”). Each Borrower hereby covenants and agrees never to institute any action or suit at law or in equity, nor institute, prosecute, or in any way aid in the institution or prosecution of, any claim, action or cause of action, rights to recover debts or demands of any nature against any of the released parties arising out of or related to a released party's actions, omissions, statements, requests or demands in administering, enforcing, monitoring, collecting or attempting to collect, the obligations, indebtedness and other obligations of an obligor to a released party. Each Borrower agrees to indemnify and hold Agent and each Lender harmless from any and all matters released pursuant to this paragraph. Each Borrower acknowledges that the agreements in this paragraph are intended to be in full satisfaction of all or any alleged injuries or damages to such Released Party arising in connection with such matters released pursuant to the other provisions of this paragraph. Each Borrower represents and warrants to Agent and Lenders that it has not purported to transfer, assign or otherwise convey any right, title or interest of a Borrower in any Released Claim to any other Person and that the foregoing constitutes a full and complete release of each Borrower’s claims with respect to all such matters. The provisions of this Section 10(c) and the representations, warranties, releases, waivers, acquittances, discharges, covenants, agreements and indemnifications contained herein (a) constitute a material consideration for and inducement to Agent and Lenders entering into this Agreement, (b) do not constitute an admission of or basis for establishing any duty, obligation or liability of Agent or a Lender to a Borrower or any other Person, (c) do not constitute an admission of or basis for establishing any liability, wrongdoing, or violation of any obligation, duty or agreement of Agent or a Lender to a Borrower or any other Person, and (d) shall not be used as evidence against Agent or a Lender by a Borrower, any successor of a Borrower, or any other Person for any purpose.

 

(d)    Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. Delivery of an executed counterpart of this Agreement by facsimile, PDF or electronic mail shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by facsimile or electronic mail shall, if requested by the other party, also deliver an original executed counterpart of this Agreement, but the failure to do so shall not affect the validity, enforceability or binding effect of this Agreement.

 

(e)    Binding Nature; Third Parties. This Agreement shall be binding upon and inure to the benefit of the parties hereto, their respective successors, successors-in-titles, and permitted assigns. No rights or claims are intended to be created hereunder for the benefit of any purported third-party beneficiary hereof.

 

(f)    Advice of Counsel. The parties hereto acknowledge that each has consulted with independent legal counsel concerning this Agreement and have knowingly and voluntarily entered into this Agreement and accepted the terms and conditions hereof.

 

(g)    Entire Understanding. This Agreement sets forth the entire understanding of the parties with respect to the matters set forth herein, and shall supersede any prior negotiations or agreements, whether written or oral, with respect thereto.

 

(h)    Agent Direction. Each Lender party hereto (which collectively constitute all of the Lenders under and as defined in the Credit Agreement) hereby (i) consents to the execution, delivery, and performance by the Agent of this Agreement, (ii) authorizes and directs the Agent to execute and deliver this Agreement and to take or forbear from taking any and all actions as set forth herein, and (iii) acknowledges and agrees that (x) the foregoing directed action constitutes a direction from all the Lenders under Article XIV of the Credit Agreement (as amended hereby), (y) Article XIV and Sections 16.5 and 16.9 of the Credit Agreement (as amended hereby) and any other rights, privileges, protections, immunities, exculpations, and indemnities in favor of the Agent hereunder apply to any and all actions taken or not taken by the Agent in accordance with such direction, and (z) the Agent may conclusively rely upon (and shall be fully protected in relying upon) the Register in determining each Lender’s ownership of the Advances on and as of the date hereof. Each undersigned Lender hereby severally, and not jointly, represents and warrants to the Agent that, on and as of the date hereof, it is duly authorized to give the foregoing direction to the Agent.

 

[Signature Pages Follow]

 

 

 

 

 

ANKURA TRUST COMPANY, LLC, 

as Agent

 

By:         /s/ Krista Gulalo                                                                

Name:    Krista Gulalo     

Title:      Managing Director  

 

 

 

 

 

 

REDACTED

 

By: Redacted

By: Redacted

 

By:  /s/ Redacted                                       

Name:         

Title:

 

 

REDACTED

 

By: Redacted

By: Redacted

 

By:  /s/ Redacted                                          

Name:          

Title: 

 

 

REDACTED

By: Redacted

By: Redacted

 

By:  /s/ Redacted                                          

Name:          

Title: 

 

 

REDACTED, as a Purchasing Lender

 

By:  /s/ Redacted                                          

Name:          

Title: 

 

 

REDACTED, as a Purchasing Lender

 

By:  /s/ Redacted                                          

Name:          

Title: 

 

 

REDACTED, as a Purchasing Lender

 

By:  /s/ Redacted                                           

Name:          

Title: 

 

 

REDACTED, as a Purchasing Lender

 

By:  /s/ Redacted                                          

Name:          

Title: 

 

 

 

 

 

BORROWERS:

ION GEOPHYSICAL CORPORATION

 

By:             /s/ Michael Morrison                                                 

Name:        Michael Morrison

Title:          EVP & CFO

 

 

ION EXPLORATION PRODUCTS (U.S.A.), INC.

 

By:             /s/ Michael Morrison                                                 

Name:        Michael Morrison

Title:          EVP & CFO

 

 

I/O MARINE SYSTEMS, INC.

 

By:             /s/ Michael Morrison                                                 

Name:        Michael Morrison

Title:          Vice President

 

 

GX TECHNOLOGY CORPORATION

 

By:             /s/ Michael Morrison                                                 

Name:        Michael Morrison

Title:          Vice President

 

 

GX GEOSCIENCE Corporation, S. DE R.L. DE C.V.

 

By:             /s/ Michael Morrison                                                 

Name:        Michael Morrison

Title:          Vice President  and Attorney-in-Factex_344593.htm

Exhibit 10.4

 

AMENDMENT NO. 2 TO FORBEARANCE AGREEMENT

 

This AMENDMENT NO. 2 TO FORBEARANCE AGREEMENT (this “Amendment”) is made as of March 7, 2022, by and among ION Geophysical Corporation, a Delaware limited liability company (the “Company”), the guarantors party hereto (the “Guarantors”), and the undersigned beneficial holders (the “Directing Noteholders”) of, in the aggregate, $91,821,000 principal amount of the 8.00% Senior Secured Second Priority Notes due 2025 issued pursuant to the Indenture dated as of April 15, 2021 between the Company, UMB Bank, National Association, as trustee, UMB Bank, National Association, as collateral agent, and the guarantors party thereto, and amends the Forbearance Agreement, dated as of January 14, 2022, by and among the Company, the Guarantors, and the Directing Noteholders (the “Original Agreement,” and as amended by this Amendment, and when taken together as one agreement with the Original Agreement, the “Forbearance Agreement”). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Original Agreement.

 

WHEREAS, in accordance with Section 8.2 of the Original Agreement, the parties hereto wish to amend the Original Agreement.

 

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

 

1.    The Directing Noteholders agree not to withdraw the Direction Letter (delivered to the Trustee on January 14, 2022) during the Forbearance Period.

 

2.    Amendment to Section 2.1(i) of the Original Agreement. Section 2.1(i) of the Original Agreement is hereby amended and restated as follows:

 

“(i) April 4, 2022 at 11:59 p.m. Eastern Time.”

 

3.    Amendment to Section 2.1(ii) of the Original Agreement. Section 2.1(ii) of the Original Agreement is hereby amended and restated as follows:

 

“(ii) intentionally omitted.”

 

4.    Amendment to Section 2.2 of the Original Agreement. Section 2.2 of the Original Agreement is hereby amended and restated as follows:

 

“Subject to the satisfaction or waiver of the conditions precedent set forth in Article III hereof, during the Forbearance Period, the Directing Noteholders agree to (i) not (a) declare the Notes due and payable pursuant to Section 6.02 of the Indenture, (b) pursue any available remedy to collect the payment of principal of, premium on, if any, or interest on the Notes in respect of the Designated Default, or (c) otherwise exercise any rights or remedies available under the Note Documents or applicable law in respect of the Designated Default against any of the Company Parties or their assets, and (ii) cause to be delivered and not withdrawn or revised, a letter, substantially in the form attached hereto as Exhibit A (the “Direction Letter”), directing the Trustee not to (a) declare the Notes due and payable pursuant to Section 6.02 of the Indenture, (b) pursue any available remedy to collect the payment of principal of, premium on, if any, or interest on the Notes or to enforce the performance of any provision of the Note Documents, or (c) otherwise exercise any rights or remedies available under the Note Documents or applicable law (the “Forbearance”). Upon termination of the Forbearance Period, the Directing Noteholders may, but are not required to, withdraw or revise the Direction Letter.

 

5.    Reference to and Effect on the Forbearance Agreement. It is the express intention of the parties hereto that this Amendment shall not, and shall not be interpreted to, expand or reduce the rights of any party to the Original Agreement except as and solely to the extent expressly provided herein. Except as expressly provided by this Amendment, the Original Agreement shall continue and remain in full force and effect in accordance with its terms.

 

6.    A copy of the amended and restated Forbearance Agreement incorporating the amendments set forth herein is attached hereto as Exhibit A.

 

[Remainder of Page Intentionally Left Blank]

 

 

 

 

IN WITNESS WHEREOF, this Amendment No. 2 to Forbearance Agreement has been duly executed and delivered by the parties hereto as of the date first written above.

 

ION GEOPHYSICAL CORPORATION

 

By:          /s/ Michael Morrison                                                                           

Name:     Michael Morrison

Title:

 

 

GX TECHNOLOGY CORPORATION

 

By:          /s/ Michael Morrison                                                                       

Name:     Michael Morrison

Title:       EVP & CFO

 

 

ION EXPLORATION PRODUCTS (U.S.A.), INC.

 

By:          /s/ Michael Morrison                                                                       

Name:     Michael Morrison

Title:       EVP & CFO

 

 

I/O MARINE SYSTEMS, INC.

 

By:          /s/ Michael Morrison                                                                       

Name:     Michael Morrison

Title:

 

 

GX GEOSCIENCE CORPORATION, S. DE R.L. DE C.V.

 

By:          /s/ Michael Morrison                                                                       

Name:     Michael Morrison

Title:       Vice President and Attorney-in-Fact

 

 

REDACTED

 

By:          /s/ Redacted                                                                                 

Name:

Title:

 

 

REDACTED

 

By:          /s/ Redacted                                                                                

Name:

Title:

 

 

REDACTED

 

By:          /s/ Redacted                                                                             

Name:

Title:

 

 

REDACTED

 

By:          /s/ Redacted                                                                                

Name: 

Title: 

 

 

REDACTED

 

By:          /s/ Redacted                                                                                

 

 

REDACTED

 

By:          /s/ Redacted                                                                                

 

 

 

Exhibit A

 

Amended & Restated Forbearance Agreement

 

 

 

 

FORBEARANCE AGREEMENT

 

This FORBEARANCE AGREEMENT, dated as of January 14, 2022 (this “Forbearance Agreement”), is by and among ION Geophysical Corporation, a Delaware corporation (the “Company”), the guarantors party hereto (the “Guarantors,” and together with the Company, the “Company Parties”), and the undersigned beneficial holders (the “Directing Noteholders”) of, in the aggregate, $91,821,000 principal amount of the 8.00% Senior Secured Second Priority Notes due 2025 (the “Notes”) issued pursuant to the indenture (the “Indenture”) dated April 15, 2021 between the Company, UMB Bank, National Association, as trustee (the “Trustee”), UMB Bank, National Association, as collateral agent, and the guarantors party thereto. The Company Parties and the Directing Noteholders are referred to herein at the “Parties.”

 

RECITALS

 

WHEREAS, as a result of a Default or Event of Default that has occurred and is continuing pursuant to Section 6.01(i) of the Indenture (the “Designated Default”), each of the Company Parties acknowledges and agrees that, subject to the Intercreditor Agreement, the Directing Noteholders are entitled to (i) declare the Notes due and payable pursuant to Section 6.02 of the Indenture, (ii) pursue any available remedy to collect the payment of principal of, premium on, if any, or interest on the Notes or to enforce the performance of any provision of the Note Documents, and (iii) exercise any or all other rights and remedies under the Note Documents or applicable law;

 

WHEREAS, the Company Parties have requested that the Directing Noteholders (i) temporarily forbear from declaring the Notes due and payable pursuant to Section 6.02 of the Indenture, or otherwise exercising any rights or remedies under the Note Documents or applicable law, and (ii) direct the Trustee to not (a) declare the Notes due and payable pursuant to Section 6.02 of the Indenture, (b) pursue any available remedy to collect the payment of principal of, premium on, if any, or interest on the Notes or to enforce the performance of any provision of the Notes or the Indenture, or (c) otherwise exercise any rights or remedies available under the Indenture or applicable law;

 

WHEREAS, the Directing Noteholders agreed to grant a period of temporary forbearance from exercising such rights and remedies under the Indenture on the terms and subject to the conditions set forth herein;

 

NOW, THEREFORE, in consideration of the agreements contained herein, as well as other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

ARTICLE I

    DEFINITIONS

 

SECTION 1.1    Certain Definitions. Capitalized terms used (including in the preamble and recitals hereto) but not defined herein shall have the meanings assigned to such terms in the Indenture.

 

ARTICLE II

    FORBEARANCE

 

SECTION 2.1    The “Forbearance Period” shall commence on the Forbearance Effective Date (as defined below) and shall automatically terminate on the earliest to occur of:

 

(i) April 4, 2022 at 11:59 p.m. Eastern Time.

 

(ii) intentionally omitted.

 

(iii) the occurrence and continuance of any Event of Default under the Note Documents (other than the Designated Default).

 

(iv) the failure of any of the Company Parties to comply with any term, condition, or covenant set forth in Article IV hereof (and such failure continues for three (3) Business Days after an Officer of any of the Company Parties obtains knowledge thereof), or any other material term, condition or covenant of this Forbearance Agreement or the Note Documents.

 

(v) any of the Company Parties contesting or denying in any manner the legality, validity, binding nature or enforceability of the Indenture, or the other Note Documents.

 

(vi) the commencement by any of the Company Parties of any action, application, petition, suit or other proceeding under any bankruptcy, arrangement, reorganization, dissolution, liquidation, insolvency, winding-up or similar law of any jurisdiction now or hereafter in effect, including without limitation, any bankruptcy or insolvency law.

 

(vii) any receiver, receiver-manager, interim receiver, monitor, liquidator, assignee, custodian, trustee, sequestrator or other similar entity appointed in respect of any of the Company Parties or all or any part of their respective assets or operations.

 

(viii) the Trustee or any holder of Notes, other than the Directing Noteholders, (a) declares the Notes immediate due and payable pursuant to Section 6.02 of the Indenture, (b) pursues any available remedy to collect the payment of principal of, premium on, if any, or interest on the Notes or to enforce the performance of any provision of the Note Documents, or (c) pursues any other right or remedy available under the Note Documents or applicable law as a result of the occurrence and continuation of the Designated Default.

 

(ix) the pursuit of any Claim (as defined herein) by any of the Company Parties against any Directing Noteholder or any Releasees (as defined herein) in violation of Section 6.1 hereof (each of the foregoing clauses (i)–(ix), a “Forbearance Default”).

 

The Company Parties shall provide notice to the Trustee and the Directing Noteholders as soon as possible but in any event within one (1) Business Day of an Officer of any of the Company Parties obtaining knowledge of the occurrence and continuance of any Forbearance Default, which notice shall state that such event occurred and set forth, in reasonable detail, the facts and circumstances that gave rise to such event. Such notice shall be given in accordance with Section 7.05 of the Indenture.

 

SECTION 2.2    Subject to the satisfaction or waiver of the conditions precedent set forth in Article III hereof, during the Forbearance Period, the Directing Noteholders agree to (i) not (a) declare the Notes due and payable pursuant to Section 6.02 of the Indenture, (b) pursue any available remedy to collect the payment of principal of, premium on, if any, or interest on the Notes in respect of the Designated Default, or (c) otherwise exercise any rights or remedies available under the Note Documents or applicable law in respect of the Designated Default against any of the Company Parties or their assets, and (ii) cause to be delivered and not withdrawn or revised, a letter, substantially in the form attached hereto as Exhibit A (the “Direction Letter”), directing the Trustee not to (a) declare the Notes due and payable pursuant to Section 6.02 of the Indenture, (b) pursue any available remedy to collect the payment of principal of, premium on, if any, or interest on the Notes or to enforce the performance of any provision of the Note Documents, or (c) otherwise exercise any rights or remedies available under the Note Documents or applicable law (the “Forbearance”). Upon termination of the Forbearance Period, the Directing Noteholders may, but are not required to, withdraw or revise the Direction Letter.

 

SECTION 2.3    The Forbearance is limited in nature and nothing contained herein is intended, or shall be deemed or construed (i) to constitute a waiver of the Designated Default or any other existing or future Defaults or Events of Default or compliance with any term or provision of the Note Documents or (ii) to establish a custom or course of dealing between any of the Company Parties, on the one hand, and the Directing Noteholders, on the other hand. Each of the Company Parties acknowledges and agrees that the Directing Noteholders’ agreement hereunder to forbear from exercising their default-related remedies with respect to the Designated Default shall not constitute a waiver of the Designated Default and that, except as expressly set forth in this Forbearance Agreement, the Directing Noteholders expressly reserve all rights and remedies that the Directing Noteholders now or may in the future have under the Note Documents and applicable law in connection with all Defaults or Events of Default (including, without limitation, the Designated Default). Any waiver of any Default or Event of Default (including the Designated Default) would be subject to, and effective only in accordance with, Section 6.04 of the Indenture. Each of the Company Parties acknowledges and agrees that defaulted interest is accruing under the Notes during the Forbearance Period.

 

SECTION 2.4    Upon the termination of the Forbearance Period, (i) the Forbearance shall terminate automatically and be of no further force or effect, (ii) the Directing Noteholders shall have all other rights and remedies available at law or in equity or pursuant to the Note Documents, all of which rights and remedies are fully reserved by the Directing Noteholders and (iii) the Directing Noteholders may, but are not required to, withdraw or revise the Direction Letter or submit a new direction letter to the Trustee. Each of the Company Parties acknowledges that the Directing Noteholders have not made any assurances concerning (i) any possibility of an extension of the Forbearance Period, (ii) the manner in which or whether the Designated Default may be resolved, (iii) whether the Trustee will comply with the Direction Letter, or otherwise exercise any rights or remedies available to the Trustee under the Indenture, or (iv) any additional forbearance, waiver, restructuring or other accommodations, except as set forth herein. The Parties agree that the running of all statutes of limitation and the doctrine of laches applicable to all claims or causes of action that any Directing Noteholder may be entitled to take or bring in order to enforce its rights and remedies against any of the Company Parties are, to the fullest extent permitted by law, tolled and suspended during the Forbearance Period. Each of the Company Parties acknowledges and agrees that any financial accommodation that any Directing Noteholder makes on or after the Forbearance Effective Date with respect to the Notes has been made by any such Directing Noteholders in reliance upon, and is consideration for, among other things, the general releases and indemnities contained in Section 6.1 hereof, and the other covenants, agreements, representations and warranties of the each of the Company Parties hereunder.

 

SECTION 2.5    As consideration for entering into this Forbearance Agreement, the Directing Noteholders acknowledge and consent to each of GX Technology Sismica do Brasil Ltda., ION International S.a.r.l. and ION International Holdings, L.P. (collectively, the “Granting Subsidiaries”) granting Liens to PNC on certain of their assets (the “Subsidiary Liens”) in accordance with the terms of the PNC Forbearance; provided that the Company Parties shall cause the Granting Subsidiaries to concurrently tender Subsidiary Liens to the Trustee with the same priority and on the same terms as currently exist under the Intercreditor Agreement.

 

ARTICLE III

    CONDITIONS TO EFFECTIVENESS

 

This Forbearance Agreement (including the Forbearance in Article II hereof), will become effective on the date (the “Forbearance Effective Date”) on which each of the following conditions have been satisfied in accordance with the terms therein:

 

SECTION 3.1    This Forbearance Agreement shall have been executed and delivered by each of the Parties.

 

SECTION 3.2    No Default or Event of Default (other than the Designated Default) shall have occurred and be continuing as of the Forbearance Effective Date.

 

SECTION 3.3    The representations and warranties in Article V hereof shall be true and correct in all material respects as of the Forbearance Effective Date.

 

ARTICLE IV

    TERMS, CONDITIONS

AND COVENANTS DURING THE FORBEARANCE PERIOD

 

Each of the Company Parties agrees to comply with the following terms, conditions and covenants during the Forbearance Period:

 

SECTION 4.1    None of the Company Parties shall (i) access any basket, exception or other provision of the Indenture that would require the absence of the occurrence and continuance of a Default or Event of Default, or (ii) utilize any basket or exception that is subject to a dollar basket or leverage threshold.

 

SECTION 4.2    None of the Company Parties shall release (i) any Guarantor from any Note Guarantee, or (ii) any Lien on any property or other assets granted to or held by the Trustee (or any sub-agent thereof) under any Note Document.

 

SECTION 4.3    Each of the Company Parties shall, and shall cause their officers, directors, employees, and advisors (i) to cooperate with the Directing Noteholders in furnishing any diligence materials reasonably requested by the Directing Noteholders regarding the Collateral, or any of the Company Parties’ financial affairs, finances, financial condition, business and operations, and (ii) participate in weekly telephonic conference calls with the Directing Noteholders to discuss, among other things, the Company Parties’ operations, cash position, and asset sale process.

 

SECTION 4.4    The Company Parties shall pay all reasonable fees and expenses of Ropes & Gray LLP, as counsel to the Directing Noteholders pursuant to the existing engagement letter.

 

SECTION 4.5    The Company Parties shall pay all reasonable fees and expenses of the Trustee and its counsel.

 

ARTICLE V

 

REPRESENTATIONS AND WARRANTIES

 

SECTION 5.1    Each of the Parties hereby represents and warrants as of the date hereof, that the execution, delivery and performance under the Forbearance Agreement (i) is within its corporate powers, (ii) has been duly authorized by all necessary corporate action, as applicable, (ii) does not and will not (a) contravene its certificates of incorporation, by-laws or other governing documents, (b) violate any judgment, order, notice, decree, statute, law, ordinance, rule, or regulation applicable to it or any of its properties or assets, (c) conflict with or result in the breach of, or constitute a default under, or result in or permit the termination or acceleration of, any other contractual obligation, or (d) result in the creation or imposition of any lien or encumbrance upon any property or other assets, and (iv) does not require the consent, authorization, or approval of any governmental authority or any other Person.

 

ARTICLE VI

    GENERAL RELEASE

 

SECTION 6.1    In consideration of, among other things, the Directing Noteholders’ execution and delivery of this Forbearance Agreement, each of the Company Parties, on behalf of itself and its agents, representatives, officers, directors, advisors, employees, subsidiaries, affiliates, successors and assigns (collectively, “Releasors”), hereby forever agrees and covenants not to sue or prosecute against any Releasee (as hereinafter defined) and hereby forever waives, releases and discharges, to the fullest extent permitted by law, each Releasee from any and all claims (including, without limitation, crossclaims, counterclaims, rights of set-off and recoupment), actions, causes of action, suits, debts, accounts, interests, liens, promises, warranties, damages and consequential damages, demands, agreements, bonds, bills, specialties, covenants, controversies, variances, trespasses, judgments, executions, costs, expenses or claims whatsoever, that such Releasor now has or hereafter may have, of whatsoever nature and kind, that are known and now existing, whether arising at law or in equity (collectively, the “Claims”), against any or all of the Directing Noteholders and their respective affiliates, subsidiaries, shareholders and “controlling persons” (within the meaning of the federal securities laws), and their respective successors and assigns and each and all of the officers, directors, employees, agents, attorneys, advisors and other representatives of each of the foregoing (collectively, the “Releasees”), based in whole or in part on facts, that are now known and existing on or before the Forbearance Effective Date, that relate to, arise out of or otherwise are in connection with: (i) any or all of the Note Documents or transactions contemplated thereby or any actions or omissions in connection therewith, or (ii) any aspect of the dealings or relationships between or among any of the Company Parties, on the one hand, and the Directing Noteholders, on the other hand, relating to any or all of the documents, transactions, actions or omissions referenced in clause (i) hereof that have occurred prior to the Forbearance Effective Date; provided that the Company Parties do not release the Releasees from their respective obligations and agreements specifically set forth in this Forbearance Agreement. The receipt by any of the Company Parties of any financial accommodations made by the Directing Noteholders after the date hereof shall constitute a ratification, adoption, and confirmation by the Company Parties of the foregoing general release of all Claims against the Releasees that are based in whole or in part on facts, that are known and now existing prior to the date of receipt of any such financial accommodations.

 

SECTION 6.2    In entering into this Forbearance Agreement, each of the Company Parties consulted with, and has been represented by, legal counsel and expressly disclaims any reliance on any representations, acts or omissions by any of the Releasees and hereby agrees and acknowledges that the validity and effectiveness of the releases set forth above do not depend in any way on any such representations, acts and/or omissions or the accuracy, completeness or validity thereof. If the any of the Company Parties or any of their successors or assigns or legal representatives violate the provisions of this Section 6.1, the Company Parties, on behalf of themselves and their successors and assigns agree to pay, in addition to any other damages that any Releasee may sustain as a result of such violation, all reasonable attorneys’ fees and costs incurred as a result of such violation. The provisions of this Section 6.1 shall survive the termination of this Forbearance Agreement and the Indenture, the other Note Documents, and payment in full of the Obligations.

 

ARTICLE VII

    EFFECTS ON THE NOTE DOCUMENTS

 

SECTION 7.1    Except as specifically amended or waived herein or contemplated hereby, all Note Documents shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. Each of the Company Parties hereby confirms that the Indenture and the other Note Documents are in full force and effect.

 

SECTION 7.2    Except as expressly set forth herein, the execution, delivery and effectiveness of this Forbearance Agreement shall not directly or indirectly (i) constitute a consent or waiver of any past, present or future violations of any provisions of the Indenture or any other Note Documents nor constitute a novation of any of the Obligations under the Indenture or other Note Documents, (ii) amend, modify or operate as a waiver of any provision of the Indenture or any other Note Documents or any right, power or remedy of any of the Directing Noteholders, (iii) constitute a consent to any merger or other transaction or to any sale, restructuring or refinancing transaction or (iv) constitute a course of dealing or other basis for altering any Obligations or any other contract or instrument. Except as expressly set forth herein, each Directing Noteholder reserves all of its rights, powers, and remedies under the Indenture, the other Note Documents and applicable law. Except as expressly set forth herein, all of the provisions of the Indenture and the other Note Documents, including, without limitation, the time of the essence provisions, are hereby reiterated.

 

SECTION 7.3    On and after the Forbearance Effective Date, (i) each reference in the Indenture to “this Indenture”, “hereunder”, “hereof”, “herein” or words of like import referring to the Indenture, and each reference in the other Note Documents to “Indenture”, “thereunder”, “thereof” or words of like import referring to the Indenture shall mean and be a reference to the Indenture, and this Forbearance Agreement and the Indenture shall be read together and construed as a single instrument and (ii) the term “Note Documents” in the Indenture and the other Note Documents shall include, without limitation, this Forbearance Agreement and any agreements, instruments and other documents executed and/or delivered in connection herewith. Nothing herein shall be deemed to entitle any of the Company Parties to a further consent to, or a further waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or agreements contained in the Indenture or any other Note Document in similar or different circumstances.

 

SECTION 7.4    Except as expressly contemplated by this Forbearance Agreement, no Directing Noteholder has waived, is by this Forbearance Agreement waiving, and has no intention of waiving (regardless of any delay in exercising such rights and remedies), any unmatured Default or Event of Default that may occur after the Forbearance Effective Date, and no Directing Noteholder has agreed to forbear with respect to any of its rights or remedies concerning any Events of Default that may occur after the Forbearance Effective Date other than the Designated Default.

 

This Forbearance Agreement shall not be deemed or construed to be a satisfaction, reinstatement, novation or release of the Indenture or any other Note Document.

 

ARTICLE VIII

    MISCELLANEOUS

 

SECTION 8.1    Indemnification. Each of the Company Parties hereby confirms that the indemnification provisions set forth in Section 7.07 of the Indenture shall apply to this Forbearance Agreement and the transactions contemplated hereby.

 

SECTION 8.2    Amendments; Execution in Counterparts; Severability.

 

(a)    This Forbearance Agreement may not be amended nor may any provision hereof be waived except pursuant to a writing signed by each of the Parties; and

 

(b)    To the extent any provision of this Forbearance Agreement is prohibited by or invalid under the applicable law of any jurisdiction, such provision shall be ineffective only to the extent of such prohibition or invalidity and only in such jurisdiction, without prohibiting or invalidating such provision in any other jurisdiction or the remaining provisions of this Forbearance Agreement in any jurisdiction.

 

SECTION 8.3    Reaffirmation. Each of the Company Parties confirms and agrees that, notwithstanding the effectiveness of this Forbearance Agreement, each Note Document to which any of the Company Parties is a party is, and the obligations of any of the Company Parties contained in the Indenture, this Forbearance Agreement or in any other Note Document to which any of the Company Parties is a party is, and shall continue to be, in full force and effect, and is hereby ratified and confirmed in all respects, in each case as amended by this Forbearance Agreement. For greater certainty and without limiting the foregoing, the each of the Company Parties hereby confirms that the existing security interests granted by any of the Company Parties in favor of the Trustee, for the benefit of, among others, the Directing Noteholders pursuant to the Note Documents in the Collateral described therein shall continue to secure the obligations of the each of the Company Parties under the Indenture and the other Note Documents as and to the extent provided in the Note Documents.

 

SECTION 8.4    Governing Law; Waiver of Jury Trial; Jurisdiction. THIS FORBEARANCE AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. SECTION 14.08 OF THE INDENTURE IS HEREBY INCORPORATED BY REFERENCE INTO THIS FORBEARANCE AGREEMENT AND SHALL APPLY HERETO.

 

SECTION 8.5    Headings. Section headings in this Forbearance Agreement are included herein for convenience of reference only, are not part of this Forbearance Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Forbearance Agreement.

 

SECTION 8.6    Severability. If any provision of this Forbearance Agreement is held to be illegal, invalid or unenforceable, (i) the legality, validity and enforceability of the remaining provisions of this Forbearance Agreement shall not be affected or impaired thereby and (ii) the Parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

SECTION 8.7    Counterparts. This Forbearance Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery by facsimile or other electronic transmission of an executed counterpart of a signature page to this Forbearance Agreement shall be effective as delivery of an original executed counterpart of this Forbearance Agreement.

 

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