Document:

EX-10.131

Exhibit 10-131

As of September 18, 2008

Bernard Chaus, Inc. (“Client Representative”)

Cynthia Steffe Acquisition, LLC

S.L. Danielle Acquisition, LLC

800 Secaucus Road

Secaucus, New Jersey 07094

FACTORING AGREEMENT

Ladies and Gentlemen:

     We are pleased to confirm the terms and conditions that will govern our funds in use
accounting, non-borrowing, notification factoring arrangement with each of you (the “Agreement”).
This Agreement shall also amend, replace and supersede in its entirety the Factoring Agreement
between us and Cynthia Steffe Acquisition, LLC dated January 15, 2004, as supplemented and amended
and the Factoring Agreement between us and Bernard Chaus, Inc. dated September 27, 2002. This
Agreement is intended to set forth the terms and provisions pursuant to which we shall factor the
sales created or arising on and after the date hereof. This Agreement shall in no way be construed
to, nor shall it affect, modify, diminish or break the continuity of our ownership and/or security
interest in, as further set forth herein, all of the present and future accounts receivable of
Cynthia Steffe Acquisition, LLC, as more fully described in said Factoring Agreement which
ownership and/or security interest is hereby ratified and confirmed by this Agreement as provided
above. For all purposes hereof, this Agreement shall apply to each of you, and the terms “you” and
“your”, and terms of like import appearing herein, in each instance shall mean each of you, except
as may be otherwise specifically noted.

     Each of you has requested that we make available the factoring and related financial
accommodations provided for in this Agreement. Your business is a mutual and collective enterprise,
and you believe that the consolidation of all factoring and related financial accommodations under
this Agreement will ease the administration of your factoring relationship with us, all to your
mutual advantage. In order to utilize your financial powers in the most efficient and economical
manner, and in order to facilitate the factoring of your Accounts, we will make factoring and
financial accommodations to you

CIT Commercial Services

11 West 42nd Street

New York, NY 10036

 

 

on a combined basis in accordance with the provisions set forth in
this agreement. Our willingness to administer your collateral security therefor on a combined basis
as more fully set forth in this Agreement is done solely as an accommodation to you and at your
request and in furtherance of your mutual and collective enterprise. This is a joint contract
between us and each of you and each of you is hereby deemed to enter into an agreement with us on
the terms conditions contained herein, as amended; however, all Obligations, reporting, minimum
fees and other provisions are hereby consolidated for the purposes of this joint agreement.

1. SALE OF ACCOUNTS

You sell and assign to us, and we purchase as absolute owner, all accounts arising from your sales
of inventory or rendition of services, including those under any trade names, through any divisions
and through any selling agent and excluding any and all cash on delivery sales, cash before
delivery sales and credit card sales (collectively, the “Accounts” and individually, an “Account”).

2. CREDIT APPROVAL

2.1 Requests for credit approval for all of your orders must be submitted to our Credit Department
via computer by either: (a) On-Line Terminal Access, or (b) Electronic Batch Transmission. If you
are unable to submit orders via computer, then orders can be submitted over the phone, by fax or in
writing. All credit decisions by our Credit Department (including approvals, declines and holds)
will be sent to the Client Representative daily by a Credit Decisions Report, which constitutes the
official record of our credit decisions. Credit approvals will be effective only if shipment is
made or services are rendered within thirty (30) days from the completion date specified in our
credit approval. Credit approval of any Account may be withdrawn by us any time before delivery is
made or services are rendered.

2.2 We assume the Credit Risk on each Account approved in the Credit Decision Report. “Credit
Risk” means the customer’s failure to pay the Account in full when due on its longest maturity
solely because of its financial inability to pay. If there is any change in the amount, terms,
shipping date or delivery date for any shipment of goods or rendition of services (other than
accepting returns and granting allowances as provided in section 8 below), you must submit a change
of terms request to us, and, if such pertains to a Factor Risk Account, then we shall advise you of
our decision either to retain the Credit Risk or to withdraw the credit approval. Accounts on
which we bear the Credit Risk are referred to collectively as “Factor Risk Accounts”, and
individually as a “Factor Risk Account”. Accounts on which you bear some or all of the risk as to
credit are referred to collectively as “Client Risk Accounts”, and individually as a “Client Risk
Account”.

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2.3 We shall have no liability to you or to any person, firm or entity for declining, withholding
or withdrawing credit approval on any order. If we decline to credit approve an order and furnish
to you any information regarding the credit standing of that customer, such information is
confidential and you agree not to reveal same to the customer, your sales agent or any third party.
You agree that we have no obligation to perform, in any respect, any contracts relating to any
Accounts.

3. INVOICING

You agree to place a notice (in form and content acceptable to us) on each invoice and invoice
equivalent that the Account is sold, assigned and payable only to us, and to take all necessary
steps so that payments and remittance information are directed to us. All invoices, or their
equivalents, will be promptly mailed or otherwise transmitted by you to your customers at your
expense. You will provide us with copies of all invoices (or the equivalent thereof if the
invoices were sent electronically), confirmation of the sale of the Accounts to us and proof of
shipment or delivery, all as we may reasonably request. If you fail to provide us with copies of
such invoices (or equivalents) or such proofs when requested by us, we will not bear any Credit
Risk as to those Accounts.

4. REPRESENTATIONS AND WARRANTIES

4.1 You represent and warrant that: each Account is based upon a bona fide sale and delivery of
inventory or rendition of services made by you in the ordinary course of business; the inventory
being sold and the Accounts created are your exclusive property and are not, and will not be,
subject to any lien, consignment arrangement, encumbrance or security interest other than in our
favor; all amounts are due in United States Dollars or Canadian Dollars, but only to the extent
such amounts are due from Wal-Mart’s or Sams’ Club’s respective Canadian affiliates; all original
invoices bear notice of the sale and assignment to us; any taxes or fees relating to your Accounts
or inventory are solely your responsibility; and none of the Accounts factored with us hereunder
represent sales to any subsidiary, affiliate or parent company. You also warrant and represent
that: your customers have accepted the goods or services and owe and are obligated to pay the full
amounts stated in the invoices according to their terms, without dispute, claim, offset, defense,
deduction, rejection, recoupment, counterclaim or contra account, other than as to returns and
allowances as provided in section 8 below (the foregoing being referred to in this Agreement as
“Customer Claims”); you and, to your knowledge, your affiliates are not Blocked Persons (as defined
in section 18.6 below); and no Account is due from a Blocked Person. Notwithstanding section 1,
you shall not sell and assign to us any Account due from a Blocked Person.

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4.2 You further represent and warrant that: your legal name is exactly as set forth on the
signature page of this Agreement, Bernard Chaus, Inc. and Cynthia Steffe Acquisition, LLC and S.L.
Danielle Acquisition, LLC are each duly organized and validly existing business organizations
incorporated or registered in the State of New York, and are qualified to do business in all states
where required; the most recent financial statements provided by you to us fairly presents in all
material respects your financial condition as of that date and there has been no material adverse
change in your financial condition since the date of those financial statements. You agree to
furnish us with such information concerning your business affairs and financial condition as we may
reasonably request from time to time, including financial statements as of the end of each fiscal
year.

4.3 You agree that you will promptly notify us of any change in your: name, state of incorporation
or registration, location of your chief executive office, place(s) of business, and legal or
business structure. Further, you agree that you will promptly notify us of any change in control
of the ownership of your business organization, and of significant lawsuits or proceedings against
you.

5. PURCHASE OF ACCOUNTS

We shall purchase the Accounts for the gross amount of the respective invoices, less: factoring
fees or charges, trade and cash discounts allowable to, or taken by, your customers, credits, cash
on account and allowances (“Purchase Price”). Our purchase of the Accounts will be reflected on
the Statement of Account (defined in section 10 below), which we shall render to you, which will
also reflect all credits and discounts made available to your customers.

6. ADVANCES

We do not expect to advance funds to you pursuant hereto prior to the collection of the Accounts,
but we may do so at your request in our sole discretion, subject to such additional terms and
conditions as we may reasonably request. We have the right, at any time and from time to time, to
hold any reserves we deem reasonably necessary as security for the payment and performance of any
and all of your Obligations (defined in section 12 below). All amounts you owe us, including all
advances to you and any debit balance in your respective Client Position Accounts (defined in
section 10 below), and any Obligations, are payable on demand and may be charged to your account at
any time.

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7. PAYMENT OF ACCOUNTS

7.1 All payments received by us on the Accounts will be promptly applied to your account with us
after crediting your customer’s account. In exchange for such application, we shall charge your
account monthly with the cost of * * * additional business days on all such payments at the rate
charged by us in section 14.1 below on debit balances. No checks, drafts or other instruments
received by us will constitute final payment of an Account unless and until such items have
actually been collected.

7.2 The amount of the Purchase Price of any Factor Risk Account which remains unpaid will be deemed
collected and will be credited to your account as of the earlier of the following dates:

     (a) the date of the Account’s longest maturity if a proceeding or petition is filed by or
against the customer under any state or federal bankruptcy or insolvency law, or if a receiver or
trustee is appointed for the customer; or

     (b) the last day of the third month following the Account’s longest maturity date if such
Account remains unpaid as of said date without the occurrence of any of the events specified in
clause (a) above.

If any Factor Risk Account credited to you was not paid for any reason other than Credit Risk, as
determined in CIT’s reasonable discretion, we shall reverse the credit and charge your account
accordingly, and such Account is then deemed to be a Client Risk Account.

8. CUSTOMER CLAIMS AND CHARGE BACKS

8.1 You must notify us promptly of any matter affecting the value, enforceability or collectibility
of any Account and of all Customer Claims. You agree to promptly issue credit memoranda or
otherwise adjust the customer’s account upon accepting returns or granting allowances. For full
invoice credit memoranda, you agree to send duplicate copies thereof to us and to confirm their
assignment to us. We shall cooperate with you in the adjustment of Customer Claims, but we retain
the right to adjust Customer Claims on Factor Risk Accounts directly with customers, upon such
terms as we in our sole discretion may deem advisable.

8.2 We may at any time charge back to your account the amount of: (a) any Factor Risk Account
which is not paid in full when due for any reason other than Credit Risk as determined by us in our
reasonable discretion; (b) any Factor Risk Account which is not paid in full when due because of an
act

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of God, civil strife, or war; (c) anticipation (interest) deducted by a customer on any
Account; (d) Customer Claims; (e) any Client Risk Account which is not paid in full when due; and
(f) any Account for which there is a breach of any representation or warranty. A charge back does
not constitute a reassignment of an Account; provided, however, we have the right in our sole
discretion to reassign to you any Client Risk Account. We shall not bear the Credit Risk on any
Account charged back to you. We shall immediately charge any deduction taken by a customer to your
account.

8.3 We may at any time charge to your account the amount of: (a) payments we receive on Client
Risk Accounts which we are required at any time to turnover or return (including preference
claims); (b) all remittance expenses (including incoming wire charges, currency conversion fees and
stop payment fees), other than stop payment fees on Factor Risk Accounts; (c) expenses, collection
agency fees and reasonable attorneys’ fees incurred by us in collecting or attempting to collect
any Client Risk Account or any Obligation (defined in section 12 below); (d) our fees for handling
collections on Client Risk Accounts which you have requested us to process, as provided in the
Guide (see section 18.2 below); and (e) any loss, liability, claim or expense covered by the
indemnity in the immediately following sentence. You shall each indemnify us for, and hold us
harmless against, any loss, liability claim or expense of any kind (including attorneys’ fees and
disbursements) arising from: (i) any Customer Claims, (ii) any claim for a return of any payment on
or relating to any Client Risk Account, or (iii) any other matter, except for any claim for a
return of any payment on or relating to any Factor Risk Account and except for a claim resulting
directly from and to the extent of our gross negligence or willful misconduct. The foregoing
indemnity shall survive any termination of this Agreement.

9. HANDLING AND COLLECTING ACCOUNTS; RETURNED GOODS

9.1 As owners of the Factor Risk Accounts, we have the right to: (a) bring suit, or otherwise
enforce collection, in your name or ours; (b) modify the terms of payment, (c) settle, compromise
or release, in whole or in part, any amounts owing, and (d) issue credits in your name or ours. To
the extent applicable, you waive any and all claims and defenses based on suretyship. If moneys
are due and owing from a customer for both Factor Risk Accounts and Client Risk Accounts, you agree
that any payments or recoveries received on such Accounts may be applied first to reduce our
liability to you on any Factor Risk Accounts. Once you have granted or issued a discount, credit
or allowance on any Account, you have no further interest therein. Any checks, cash, notes or
other documents or instruments, proceeds or property received with respect to the Accounts must be
held by you in trust for us, separate from your own property, and immediately turned over to us
with proper endorsements. We may endorse your name or ours on any such check, draft, instrument or
document.

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9.2 As owners and assignees of the Accounts and all proceeds thereof, upon our written notice, you
will, at your expense, comply with our instructions relative to any and all returned, rejected,
reclaimed or repossessed inventory (“Returned Goods”).

10. STATEMENT OF ACCOUNT

On a monthly basis, we shall make available to the Client Representative certain reports reflecting
Accounts purchased, advances made, if any, fees and charges and all other financial transactions
between us during the applicable period (“Reports”). The Reports that shall be made available to
you include a Statement of Account reflecting transactions in three sections: an accounts
receivable account (the “Accounts Receivable”), a client position account (the “Client Position
Account”) and a funds in use account (the “Funds In Use”). The Reports shall be deemed correct and
binding upon you and shall constitute an account stated between us unless we receive your written
statement of exceptions within thirty (30) days after same are made available to you.

11. GRANT OF SECURITY INTEREST

11.1 You hereby assign and grant to us a continuing security interest in all of your right, title
and interest in and to all of your now existing and future Collateral, as such term is defined in
the Financing Agreement.

11.2 You agree to take all actions necessary to perfect our security interest in collateral pledged
to us hereunder subject only to Permitted Encumbrances, as such term is defined in the Financing
Agreement, and to execute such documents as we may require to effectuate the foregoing and to
implement this Agreement. You irrevocably authorize us to file financing statements, and all
amendments and continuations with respect thereto, all in order to create, perfect or maintain our
security interest in the Collateral, and you hereby ratify and confirm any and all financing
statements, amendments and continuations with respect thereto heretofore and hereafter filed by us
pursuant to the foregoing authorization.

12. OBLIGATIONS SECURED

The security interest granted hereunder and any lien or security interest that we now or hereafter
have in any of your other assets, collateral or property, secure the payment and performance of all
of your now existing and future indebtedness and obligations to us, whether absolute or contingent,
whether arising under this Agreement or any other agreement or arrangement between us, by operation
of law or

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otherwise (“Obligations”). Obligations also includes ledger debt (which means
indebtedness for goods and services purchased by you from any party whose accounts receivable are
factored or financed by us), and indebtedness arising under any guaranty, credit enhancement or
other credit support granted by you in our favor or issued by us on your behalf. Any reserves or
balances to your credit and any other assets, collateral or property of yours in our possession
constitutes security for any and all Obligations.

13. BOOKS AND RECORDS AND EXAMINATIONS

13.1 You agree to maintain such Books and Records concerning the Accounts as we may reasonably
request and to reflect our ownership of the Accounts therein. “Books and Records” means your
accounting and financial records (whether paper, computer or electronic), data, tapes, discs, or
other media, and all programs, files, records and procedure manuals relating thereto, wherever
located.

13.2 Upon our reasonable request, you agree to make your Books and Records available to us for
examination and to permit us to make copies or extracts thereof. Also, you agree to permit us to
visit your premises during your business hours and to conduct such examinations as we deem
reasonably necessary. To cover our costs and expenses of any such examinations, we shall charge
you a fee for each day, or part thereof, during which such examination is conducted, plus any
out-of-pocket costs and expenses incurred by us, as provided in the Guide (see section 18.2 below).

14. INTEREST

14.1 Interest is charged on any adjustments under this Agreement and on any advances that may be
made under section 6 above, as of the last day of each month based on the daily debit balances in
your Funds In Use account for that month, at a rate equal to the sum of 0.5% plus the JPMorgan Rate
(defined below). The JPMorgan Rate is the per annum rate of interest publicly announced by
JPMorgan Chase Bank (or its successor) in New York, New York from time to time as its prime rate,
and is not intended to be the lowest rate of interest charged by JPMorgan Chase Bank to its
borrowers. Any change in the rate of interest hereunder due to a change in the JPMorgan Rate will
take effect as of the first of the month following such change in the JPMorgan Rate. Interest will
be credited as of the last day of each month based on the daily credit balances in your Funds In
Use account for that month, at a rate 3% per annum below the JPMorgan Rate (but in no event less
than 0%) being used to calculate interest for the period. All interest is calculated on a 360 day
year.

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14.2 If you, as a client of ours, purchase goods or services from another client of ours and your
payments on these invoices are not timely received, a late interest payment, at our then late
interest rate, will be charged to your account with us and shall be deemed an Obligation under this
Agreement.

14.3 In no event will interest charged hereunder exceed the highest lawful rate. In the event,
however, that we do receive interest in excess of the highest lawful rate, you agree that your sole
remedy would be to seek repayment of such excess, and you irrevocably waive any and all other
rights and remedies which may be available to you under law or in equity.

15. FACTORING FEES AND OTHER CHARGES

15.1 For our services hereunder, you will pay us a factoring fee or charge of (a) * * * , (b) * * *
and (c) * * * . In addition, you will pay a fee of * * * of each Account for each thirty (30) day
period or part thereof by which the longest terms of sale applicable to such Account exceed sixty
(60) days (whether as originally stated or as a result of a change of terms requested by you or the
customer). For Accounts arising from sales to customers located outside the fifty states of the
United States of America and Puerto Rico (* * *), you will pay us * * * of all such Accounts. All
factoring fees or charges are due and charged to your account upon our purchase of the underlying
Account. Commencing on the date occurring on the first day of the next month hereafter, the actual
factoring fees or charges paid to us by each of you on a combined basis during any Contract Year
(as hereinafter defined) or part thereof (“Period”) shall be no less than $* * * (“Minimum
Factoring Fees”); provided, however, in the event CIT voluntarily terminates this
Agreement other than upon the occurrence of an Event of Default or the termination of this
Agreement in accordance with its terms, the Minimum Factoring Fee for such Contract Year shall be
prorated based on the number of days elapsed during such Contract Year to the effective date of
such termination . “Contract Year” shall mean the twelve-month period ending on the initial
Anniversary Date and each Anniversary Date thereafter.

15.2 You agree to pay all costs and expenses incurred by us in connection with or in any way
related to: (i) this Agreement or (ii) the preparation, execution, administration and enforcement
of this Agreement, including all reasonable fees and expenses attributable to the services of our
attorneys (whether in-house or outside), search fees and public record filing fees. Furthermore,
you agree to pay to us our fees (as more fully set forth in the Guide, see section 18.2 below)
including fees for: (a) special reports prepared by us at your request; (b) wire transfers; (c)
handling change of terms requests relating to Accounts; and (d) your usage of our on-line computer
services. Beginning on the first of the month six months from the date hereof, you also agree to
pay us our fees for: (i) each new customer set-up on our customer accounts receivable data base and
each new customer relationship established for you; (ii)

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crediting your account with proceeds of
non-factored invoices received by us; and (iii) charge backs of invoices factored with us that were
paid directly to you. All such fees will be charged to your account when incurred. We may change
our fees from time to time upon notice to you; however, any failure to give you such notice does
not constitute a breach of this Agreement and does not impair our ability to institute any such
change.

15.3 Any tax or fee of any governmental authority imposed on or arising from any transactions
between us, any sales made by you, or any inventory relating to such sales is your sole
responsibility (other than income and franchise taxes imposed on us which are not related to any
specific transaction between us). If we are required to withhold or pay any such tax or fee, or
any interest or penalties thereon, you hereby indemnify and hold us harmless therefor and we shall
charge your account with the full amount thereof.

15.4 If by November 15, 2008, you have not begun to process all invoices with us by means of
Electronic Batch Transmission, then we will charge you a factoring fee of 0.10% of the gross face
amount of all Accounts in addition to the factoring fees as set forth in section 15.1, until such
time as your invoices are processed by means of Electronic Batch Transmission.

16. TERMINATION

16.1 At any time concurrently with or following the termination of that certain Financing Agreement
between us and the full and final payment to us of all of your indebtedness and obligations to us
thereunder, you may thereafter terminate this Agreement only as of the third Anniversary Date;
provided you have given us at least sixty (60) days prior written notice of termination. Except as
set forth in Section 15.1 above, upon any termination of this Agreement, we shall be entitled to
the unpaid portion of the Minimum Factoring Fees, if any, for such Period or Periods for the
remainder of the term of this Agreement, as applicable, and as provided in section 15.1 above, as
of the effective date of termination. “Anniversary Date” means the last day of the month following
the month which is one year from the date hereof, and the same date in each year thereafter.
Except as otherwise provided, we may terminate this Agreement at any time by giving you at least
ninety (90) days prior written notice of termination. However, we may terminate this Agreement
immediately, without prior notice to you, upon the occurrence of an Event of Default (defined in
section 17.1 below). Termination of this Agreement by written notice, shall only be applicable,
however, with respect whichever of you gives or is given such notice, and any such notice shall not
terminate this Agreement as to the other of you and any such notice shall also not be applicable
to, or otherwise adversely affect the obligations hereunder of, the other of you that has not given
or been given such notice, as the case may be.

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16.2 This Agreement remains effective between us until terminated as herein provided. Unless
sooner demanded, all Obligations will become immediately due and payable upon any termination of
this Agreement.

16.3 All of our rights, liens and security interests hereunder continue and remain in full force
and effect after any termination of this Agreement and pending a final accounting, we may withhold
any balances in your account unless we are supplied with an indemnity satisfactory to us to cover
all Obligations. You agree to continue to assign accounts receivable to us and to remit to us all
collections on accounts receivable, until all Obligations have been paid in full, you have provided
a backstop letter of credit with respect to such Obligations or we have been supplied with a
backstop letter of credit from an acceptable to us with respect to such balances or an indemnity
satisfactory to us to cover all Obligations. Upon any termination of this Agreement, in addition
to, and without limitation of, our other rights hereunder, we in our sole discretion shall have the
right to confirm and verify that all Accounts created on or before the effective date of
termination have been sold and assigned to us hereunder. In the event we determine that you have
not sold and assigned to us all such Accounts, then we shall charge your account with the aggregate
amount of the factoring fees or charges that we would have been paid if you had sold and assigned
to us all such Accounts as is required hereunder. Such amount shall be included in the
Obligations. In order to conduct such confirmation and verification, you agree at all reasonable
times to make your Books and Records available to us for examination and to permit us to make
copies or extracts thereof. Also, you agree to permit us to visit your premises during your
business hours and to conduct such examinations as we deem reasonably necessary to effectuate the
foregoing confirmation and verification.

17. EVENTS OF DEFAULT AND REMEDIES UPON DEFAULT

17.1 It is an “Event of Default” under this Agreement if: (a) either of your respective businesses
ceases or a meeting of your respective creditors is called; (b) any bankruptcy, insolvency,
arrangement, reorganization, receivership or similar proceeding is commenced by or against either
of you under any federal or state law; (c) either of you breach any representation, warranty or
covenant contained in this Agreement; (d) either of you fail to pay any Obligation when due, or (e)
any default shall have occurred under any other agreement or arrangement between us and either of
you.

17.2 After the occurrence and during the continuance of an Event of Default which is not waived by
us, we may terminate this Agreement without notice to you. We shall then have immediate access to
any and all Books and Records as may pertain to the Accounts, Returned Goods and any other
collateral hereunder. Furthermore, as may be necessary to administer and enforce our rights in the

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Accounts, Returned Goods and any other collateral hereunder, or to facilitate the collection or
realization thereof, we have your permission to use (at your expense) your personnel, supplies,
equipment, computers and space, at your place of business or elsewhere.

17.3 After the occurrence and during the continuance of an Event of Default which is not waived by
us, with respect to any other property or collateral in which we have a security interest, we shall
have all of the rights and remedies of a secured party under Article 9 of the Uniform Commercial
Code. If notice of intended disposition of any such property or collateral is required by law, it
is agreed that ten (10) days notice constitutes reasonable notice. The net cash proceeds resulting
from the exercise of any of the foregoing rights, after deducting all charges, costs and expenses
(including reasonable attorneys’ fees) will be applied by us to the payment or satisfaction of the
Obligations, whether due or to become due, in such order as we may elect. You remain liable to us
for any deficiencies. With respect to Factor Risk Accounts and Returned Goods relating thereto,
you hereby confirm that we are the owners thereof, and that our rights of ownership permit us to
deal with this property as owner and you confirm that you have no interest therein.

18. MISCELLANEOUS PROVISIONS

18.1 This Agreement, and all attendant documentation, as the same may be amended from time to time,
constitutes the entire agreement between us with regard to the subject matter hereof, and
supersedes any prior agreements or understandings. This Agreement can be changed only by a writing
signed by both of us. Our failure or delay in exercising any right hereunder will not constitute a
waiver thereof or bar us from exercising any of our rights at any time. The validity,
interpretation and enforcement of this Agreement is governed by the laws of the State of New York,
excluding the conflict laws of such State.

18.2 The Client Service Guide, as supplemented and amended from time to time (the “Guide”) has been
furnished to you or is being furnished to you concurrently with the signing of this Agreement, and
by your signature below you acknowledge receipt thereof. The Guide provides information on credit
approval processes, accounting procedures and fees. The procedures for Electronic Batch
Transmission are covered in supplemental instructions to the Guide. From time to time, we may
provide you with amendments, additions, modifications, revisions or supplements to the Guide, which
will be operative for transactions between us. All information and exhibits contained in the Guide,
on any screen accessed by you, and on any print-outs, reports, statements or notices received by
you are, and will be, our exclusive property and are not to be disclosed to, or used by, anyone
other than you, your employees or your professional advisors, in whole or in part, unless we have
consented in writing.

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18.3 This Agreement binds and benefits each of us and our respective successors and assigns;
provided, however, that you may not assign this Agreement or your rights hereunder
without our prior written consent. You agree that we may, without notifying you, sell, assign or
transfer our rights and obligations under this Agreement, including, without limitation, our rights
and obligations with respect to the Accounts and the Collateral, provided, however, unless there
shall have occurred and be continuing a Default or Event of Default, we shall only assign our
rights to an Eligible Assignee, as such term is defined in the Financing Agreement.

18.4 Section headings are for convenience only and are not controlling. The use of “including”
means “including without limitation”.

18.5 If any provision of this Agreement is contrary to, prohibited by, or deemed invalid under
applicable laws or regulations, such provision will be inapplicable and deemed omitted to such
extent, but the remainder will not be invalidated thereby and will be given effect so far as
possible.

18.6 You further represent or covenant, as the case may be, that you: (i) are familiar with all
applicable laws, regulations, orders, etc. in effect from time to time relating to anti-money
laundering and terrorism (“Anti-Terrorism Laws”) of the United States of America, including the USA
Patriot Act; (ii) acknowledge that your transactions are subject to applicable Anti-Terrorism Laws;
(iii) will comply in all material respects with all applicable Anti-Terrorism Laws, including, if
appropriate, the USA Patriot Act; (iv) acknowledge that our performance hereunder is also subject
to our compliance with all applicable Anti-Terrorism Laws, including the USA Patriot Act; (v)
acknowledge that we will not conduct business with any Blocked Person and we will not knowingly
purchase any Account due from a Blocked Person; (vi) will provide to us all such information about
your ownership, officers, directors, business structure and, to the extent not prohibited by
applicable law or agreement, customers, as we may reasonably require; and (vii) will take such
other action as we may reasonably request in connection with our obligations described in clause
(iv) above. “Blocked Person” shall mean any person: (i) listed in the annex to Executive Order
13224, (ii) owned or controlled by, or acting for or on behalf of, any person listed in the annex
to Executive Order 13224, (iii) with which we are prohibited from dealing or otherwise engaging in
any transaction by any Anti-Terrorism Law, (iv) that commits, threatens or conspires to commit or
supports “terrorism” as defined in Executive Order 13224, (v) a person that is named a “specially
designated national” or “blocked person” on the most current list published by OFAC or other
similar list, (vi) a person that is named a “denied person” on the most current list published by
the U.S. Commerce Department, or (vii) (A) an agency of the government of a Sanctioned Country, (B)
an organization controlled by a Sanctioned Country, or (C) a person resident in a Sanctioned
Country to the

13

 

extent subject to a sanctions program administered by OFAC. “Sanctioned Country”
shall mean any country subject to the sanctions program identified on the most current list
maintained by OFAC.

19. JOINT ADMINISTRATION/SPECIAL PROVISIONS REGARDING MULTIPLE CLIENTS

19.1 The Client Representative shall act under this Agreement as the representative of each of you,
and you hereby appoint and authorize the Client Representative to serve as your representative
hereunder, for all purposes, including, without being limited to, receiving account statements and
other notices and communications to either of you from us. In connection with the joint
administration of this Agreement, each of you expects to derive benefit, directly or indirectly,
from this Agreement, since the successful operation of each of your operations is dependent on the
continued successful performance of the functions of the integrated group. Without limiting the
foregoing, however, in addition to actions taken by the Client Representative hereunder, any action
taken by either of you under this Agreement or under any other agreement between us and either of
you, including without limitation any action of your respective officers, employees or agents,
shall also be deemed to be properly authorized by each of you and shall additionally constitute an
action that is valid, binding and enforceable for all purposes of this Agreement against each of
you. We shall keep separate accounts in each of your names and we shall be entitled to rely upon
your respective instructions and/or the instructions of the Client Representative with respect to
these accounts. It is, however, expressly understood and agreed that the separate accounts are
merely for your respective bookkeeping convenience and that for all purposes this Agreement, we may
treat all accounts carried on our books for either of you subject to section 19.2 below. You hereby
additionally confirm that the foregoing arrangement shall have no effect on the joint and several
character of your liability for the Obligations.

19.2 The Obligations shall constitute the joint and several, direct and general obligation of each
of you, including without limitation, for any chargebacks, commissions, interest, fees, costs,
expenses, and any advances made and to be made by us to either of you under this Agreement.
Furthermore, any collateral security now or hereafter given to us by either of you shall secure all
Obligations, on a collective basis, and shall be deemed to be pledged as security for any and all
Obligations of either and both of you to us. Notwithstanding anything to the contrary contained
herein, you shall be jointly and severally liable to us for all Obligations and shall have the
obligations of a co-maker with respect to the Obligations, it being agreed that all of our dealings
with the Client Representative as herein set forth inure hereunder to the benefit of each of you,
and that we are relying on the joint and several liability of each of you as co-makers in respect
of the Obligations.

14

 

19.3 Your joint and several liability shall not be impaired or affected by any modification,
supplement, extension or amendment or any contract or agreement to which either of you may
hereafter agree (other than an agreement signed by us specifically releasing such liability), nor
by any delay, extension if time, renewal, compromise or other indulgence granted by us with respect
to any of the Obligations, nor by any other agreements or arrangements whatever with either of you
or with anyone else, each of you hereby waiving all notice of such delay, extension, release,
substitution, renewal, compromise or other indulgence, and hereby consenting to be bound thereby as
fully and effectually as if it had expressly agreed thereto in advance. Your liability is direct
and unconditional as to all of the Obligations, and may be enforced without requiring us first to
resort to any other right, remedy or security. You hereby expressly waive promptness, diligence,
notice of acceptance and any other notice with respect to any of the Obligations and/or this
Agreement (other than notices expressly required in this Agreement) and any requirement that we
protect, secure, perfect or insure any lien or any property subject thereto or exhaust any right or
take any action against any of you or any Collateral.

{Remainder of Page Intentionally Left Blank}

15

 

20. JURY TRIAL WAIVER

To the extent permitted by applicable law, we each hereby waive any right to a trial by jury in any
action or proceeding arising directly or indirectly out of this Agreement, or any other agreement
or transaction between us or to which we are parties.

If the foregoing is in accordance with your understanding, please so indicate by signing and
returning to us the original and one copy of this Agreement. This Agreement will take effect as of
the date set forth above but only after being accepted below by one of our officers in New York,
New York, after which we shall forward a fully executed copy to you for your files.

	 	 	 	 	 
	Sincerely,	 	 
	 
	 	 	 	 
	THE CIT GROUP/COMMERCIAL SERVICES, INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/ Geoffrey Goldstein	 	 
	 

	 	 	 	 
	Name:

	 	Geoffrey Goldstein	 	 
	Title:

	 	Vice President	 	 

	 	 	 	 	 	 	 	 	 
	Read and Agreed to:	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	BERNARD CHAUS, INC.	 	CYNTHIA STEFFE ACQUISITION, LLC	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ David Stiffman
	 	By:
	 	/s/ David Stiffman	 	 
	 

	 	 
	 	 	 	 	 	 
	Name:

	 	David Stiffman
	 	Name:
	 	David Stiffman	 	 
	Title:

	 	Chief Operating Officer
	 	Title:
	 	 Chief Operating Officer	 	 
	 
	 	 	 	 	 	 	 	 
	S.L. DANIELLE ACQUISITION, LLC.	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ David Stiffman	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	Name:

	 	David Stiffman	 	 	 	 	 	 
	Title:

	 	Chief Operating Officer	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 

16

 

	 	 	 	 	 	 	 	 	 
	Accepted at New York, New York	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	THE CIT GROUP/COMMERCIAL SERVICES, INC.	 	S.L. DANIELLE ACQUISITION, LLC.	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Kevin J. Winsch
	 	By:
	 	/s/ David Stiffman	 	 
	 

	 	 
	 	 	 	 	 	 
	Name:

	 	Kevin J. Winsch
	 	Name:
	 	David Stiffman	 	 
	Title:

	 	Senior Vice President
	 	Title:
	 	 Chief Operating Officer	 	 

17exv10w1

Exhibit 10.1

FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT

AGREEMENT AND DOMESTIC SECURITY AGREEMENT

     This First Amendment to Amended and Restated Credit Agreement and Domestic Security Agreement
(this “Amendment”) is made and entered into effective as of the 17th day of
September, 2008 (the “First Amendment Effective Date”), by and among ION GEOPHYSICAL
CORPORATION, a Delaware corporation (the “Domestic Borrower”), ION INTERNATIONAL S.À R.L.,
a Luxembourg private limited company (société à responsabilité limitée), having its registered
office at 560A rue de Neudorf, L-2220 Luxembourg, with a share capital of EUR12,500, and registered
with the Luxembourg Register of Commerce and Companies under the number B-135.679 (the “Foreign
Borrower” and together with the Domestic Borrower, the “Borrowers”), the Guarantors
party hereto (the “Guarantors”), the Lenders party hereto, HSBC BANK USA, N.A.
(“HSBC”), as Administrative Agent, Joint Lead Arranger and Joint Bookrunner, ABN AMRO
INCORPORATED, as Joint Lead Arranger and Joint Bookrunner (“ABN AMRO”, in such capacity and
together with HSBC, the “Arrangers”) and CITIBANK, N.A., as Syndication Agent.

RECITALS

     WHEREAS, the above-named parties have entered into that certain Amended and Restated Credit
Agreement dated as of July 3, 2008 (as amended or restated from time to time prior to the date
hereof, the “Credit Agreement”), by and among the Borrowers, the Guarantors, the Lenders
and the Administrative Agent; and

     WHEREAS, the Borrowers have now asked the Lenders and the Administrative Agent to amend
certain provisions of the Credit Agreement, including, without limitation, specifically to advance
additional funds thereunder, amend certain covenants, make other changes and increase the Revolving
Commitments thereunder, and said parties are willing to do so subject to the terms and conditions
set forth herein, provided that the Domestic Borrower and Domestic Guarantors ratify and confirm
all of their respective obligations under the Credit Agreement and each other Loan Document to
which each is a party and that the Foreign Borrower and Foreign Guarantors ratify and confirm all
of their respective obligations under the Credit Agreement and each other Loan Document to which
each is a party.

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set forth in this
Amendment, Borrowers, Guarantors, the Lenders party hereto and the Administrative Agent agree as
follows:

          1. Defined Terms. Unless otherwise defined herein, capitalized terms used herein have
the meanings assigned to them in the Credit Agreement.

          2. Amendments. (a) The Credit Agreement is hereby amended as follows:

     (i) Amendments to Section 1.01. Section 1.01 is hereby amended by
deleting the following definitions and restating them in their entirety to read as
follows:

“Alternative Currency” means with respect to any Loan or Letter of Credit, Euros, Pounds
Sterling or Canadian Dollars.

 

 

“Applicable Margin” means, on any day, for any Revolving Loan, the applicable per annum
percentage set forth at the appropriate intersection in the Revolving Loans table shown below,
and, for the Term Loans, the applicable per annum percentage set forth at the appropriate
intersection in the Term Loans table shown below, each of which is based on the Leverage Ratio
for the most recently ended trailing four-quarter period with respect to which the Domestic
Borrower is required to have delivered the financial statements and Compliance Certificate
pursuant to Section 5.01 hereof (as such Leverage Ratio is reflected in the Compliance
Certificate delivered under Section 5.01(c) by the Domestic Borrower in connection with
such financial statements):

Revolving Loans

	 	 	 	 	 	 	 
	Level	 	Leverage Ratio	 	LIBO Rate Margin	 	ABR Margin
	I	 	<0.75x	 	1.875%	 	0.375%
	II	 	30.75x<1.25x	 	2.125%	 	0.625%
	III	 	31.25x<1.75x	 	2.375%	 	0.875%
	IV	 	31.75x<2.25x	 	2.625%	 	1.125%
	V	 	32.25x	 	2.875%	 	1.375%

Term Loans

	 	 	 	 	 	 	 
	Level	 	Leverage Ratio	 	LIBO Rate Margin	 	ABR Margin
	I	 	<0.75x	 	2.125%	 	0.625%
	II	 	30.75x<1.25x	 	2.375%	 	0.875%
	III	 	31.25x<1.75x	 	2.625%	 	1.125%
	IV	 	31.75x<2.25x	 	2.875%	 	1.375%
	V	 	32.25x	 	3.125%	 	1.625%

Each change in the Applicable Margin shall take effect on each date on which such financial
statements and Compliance Certificate are required to be delivered pursuant to Section
5.01, commencing with the date on which such financial statements and Compliance Certificate
are required to be delivered for the four-quarter period ending June 30, 2008. Notwithstanding
the foregoing, for the two (2) quarterly periods following the date of the initial Term Loan
Borrowing, the Applicable Margin shall be determined at Level IV. In the event that any
financial statement delivered pursuant to Section 5.01 is shown to be inaccurate when
delivered (regardless of whether this Agreement or the Revolving Loan Commitments are in effect
when such inaccuracy is discovered), and such inaccuracy, if corrected, would have led to the
application of a higher Applicable Margin for any period (an “Applicable Period”) than
the Applicable Margin applied for such Applicable Period, and only in such case, then the
Domestic Borrower shall immediately (i) deliver to the Administrative Agent corrected financial
statements for such Applicable Period, (ii) determine the Applicable Margin for such Applicable
Period based upon the corrected financial statements, and (iii) immediately pay to the
Administrative Agent the accrued

2

 

additional interest owing as a result of such increased Applicable Margin for such Applicable
Period, which payment shall be promptly applied by the Administrative Agent in accordance with
Section 2.16(a). This provision is in addition to the rights of the Administrative
Agent and the Lenders with respect to Section 2.11(d) and their other respective rights
under this Agreement. If the Domestic Borrower fails to deliver the financial statements and
corresponding Compliance Certificate to the Administrative Agent at the time required pursuant
to Section 5.01, then effective as of the date such financial statements and
corresponding Compliance Certificate were required to the delivered pursuant to Section
5.01, the Applicable Margin shall be determined at Level V and shall remain at such level
until the date such financial statements and corresponding Compliance Certificate are so
delivered by the Domestic Borrower. The Applicable Margin for the Term Loans shall be increased
by 0.25% at all levels, and the Applicable Margin for the Revolving Loans shall be increased by
0.50% at all levels, in each case, commencing on the First Amendment Effective Date and ending
on the date the Domestic Borrower repays the Revolving Loans borrowed for the purpose of
financing the ARAM Acquisition.

“Availability Period” means (i) in regard to the Revolving Loans, the period from and
including the Effective Date of the Credit Agreement to but excluding the earlier of the
Revolving Credit Termination Date and the date of termination of all of the Revolving Loan
Commitments as set forth herein and (ii) in regard to the Term Loan, the period from and
including the First Amendment Effective Date to and including the sooner of (a) November 1,
2008, and (b) the date on which the Term Loans are funded.

“Borrowing” means Loans of the same Type, made, converted or continued on the same date
and, in the case of any Loan to which the LIBO Rate is applicable, as to which a single Interest
Period is in effect.

“Borrowing Request” means a request by either Borrower for a Revolving Loan Borrowing or
a request by the Domestic Borrower for a Term Loan, in each case, in accordance with Section
2.03.

“Business Day” means any day that is not a Saturday, Sunday or other day on which
commercial banks in New York City, New York, Houston, Texas or Calgary, Alberta, Canada are
authorized or required by Law to remain closed; provided that, when used in connection with a
Eurodollar Loan or an Alternative Currency Loan, the term “Business Day” shall also exclude any
day on which banks are not open for dealings in dollar deposits or Alternative Currencies in the
London interbank market (and if the Borrowings which are the subject of a borrowing, drawing,
payment, reimbursement or rate selection are denominated in Euros, the term “Business Day” shall
also exclude any day that is not a TARGET day).

“Compliance Certificate” means the certificate required to be delivered pursuant to
Section 5.01(b).

“Domestic Security Agreement” means a Security and Pledge Agreement securing the
Domestic Loans and guarantees thereof.

“Excluded Taxes” means, with respect to the Administrative Agent, any Lender, Issuing
Lender or any other recipient of a payment to be made by or on account of any Obligation, (a)
taxes imposed on or measured by its overall net income, however denominated, and

3

 

franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any
political subdivision thereof) under the laws of which such recipient is organized or in which
its principal office is located or, in the case of any Lender, in which its applicable lending
office is located; and (b) any branch profits taxes imposed by the United States of America or
any similar tax imposed by any other jurisdiction in which a Lender is located.

“Fee Letters” means: (i) the letter agreement dated July 2, 2008, among the Borrowers
and the Administrative Agent pertaining to certain fees payable to the Administrative Agent and
(ii) the letter agreement dated August 28, 2008, between the Domestic Borrower and the
Administrative Agent related to the Term Loan Commitments.

“Interest Election Request” means a request by either Borrower to convert or continue a
Borrowing in accordance with Section 2.06 and substantially in the form attached hereto as
Exhibit 2.06 or such other form reasonably acceptable to the Administrative Agent.

“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all
outstanding Letters of Credit at such time plus (b) the aggregate amount of all LC Disbursements
that have not yet been reimbursed by or on behalf of a Borrower or converted into a Revolving
Loan pursuant to Section 2.04(e) at such time. The LC Exposure of any Revolving Lender
at any time shall be its Applicable Percentage of the total LC Exposure at such time.

“Loans” means all Revolving Loans and Term Loans made by the Lenders to a Borrower
pursuant to this Agreement, and a Loan shall mean either a Revolving Loan or a Term Loan.

“Material Contract” means any contract or agreement, written or oral, to which a
Borrower or any of its Subsidiaries is a party (other than the Loan Documents) that is listed as
a “Material Contract” in the most recently filed Annual Report of the Domestic Borrower on Form
10-K, or in any Quarterly Report of the Domestic Borrower on Form 10-Q or Current Report of the
Domestic Borrower on Form 8-K filed thereafter (each as may be amended) until the Form 10-K for
the immediately succeeding fiscal year is filed.

“Note” has the meaning set forth in Section 2.08(h).

“Required Lenders” means, at any time, Lenders having Revolving Credit Exposures,
unused Revolving Loan Commitments and, prior to the funding of the Term Loans, and, as
applicable, Term Loan Commitments, or, after the funding of the Term Loans, outstanding Term
Loans, representing more than 50.0% of the sum of the total Revolving Credit Exposures, unused
Revolving Loan Commitments and, as applicable, Term Loan Commitments or outstanding Term Loans
at such time.

“Restricted Payment” means: (i) any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in any Borrower or any of
their Subsidiaries, or any payment (whether in cash, securities or other property), including
any sinking fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any such Equity Interests in any Borrower, or any of
their Subsidiaries or any option, warrant or other right to acquire any such Equity Interests in
any Borrower or any of its Subsidiaries, or (ii) any principal repayment, defeasance, sinking
fund or similar deposit, whether in cash, securities or other property, of the Junior Financing
or the ARAM Sellers’ Note.

4

 

“Revolving Credit Termination Date” means July 3, 2013, provided, the
Administrative Agent may accelerate the maturity date of the Revolving Loans such that the
Revolving Credit Termination Date shall be the Advanced Maturity Date if the Junior Financing is
not either paid in full or refinanced on or prior to the Advanced Maturity Date pursuant to
terms reasonably satisfactory to the Administrative Agent, said acceleration to be effective
upon written notice given to the Domestic Borrower by the Administrative Agent no later than
thirty (30) days following the fourth anniversary date of the First Amendment Effective Date.

“Revolving Loan” means a Loan made pursuant to any of Sections 2.01(a)-(c).

“Super Majority Lenders” means, at any time, Lenders having Revolving Credit Exposures,
unused Revolving Loan Commitments and, prior to the funding of the Term Loans, and, as
applicable, Term Loan Commitments, or, after the funding of the Term Loans, outstanding Term
Loans, representing more than 66 2/3% of the sum of the total Revolving Credit Exposures, unused
Revolving Loan Commitments and, as applicable, Term Loan Commitments or outstanding Term Loans
at such time.

     (ii) Section 1.01 is hereby further amended by adding the following
definitions thereto in the proper alphabetical order.

“Advanced Maturity Date” means the date that is six months prior to the date any Junior
Financing (other than the Short Term Interim Junior Financing) is scheduled to mature.

“ARAM” means ARAM Systems Ltd., an Alberta corporation, and its permitted successors and
assigns.

“ARAM Acquisition” means the acquisition of ARAM and certain of its subsidiaries or
Affiliates, including Canadian Seismic Rentals, Inc., an Alberta corporation, pursuant to the
terms of the ARAM Purchase Agreement.

“ARAM Purchase Agreement” means that certain Amended and Restated Share Purchase
Agreement, dated as of September 17, 2008, by and among Domestic Borrower, ARAM, Canadian
Seismic Rentals Inc. and the “Sellers” named therein, as amended, restated, or otherwise
modified from time to time.

“ARAM Sellers’ Note” means that certain unsecured promissory note, in an aggregate
principal amount not in excess of $35,000,000, that will mature no later than the first
anniversary of the closing of the ARAM Acquisition, anticipated to be issued by 3226509 Nova
Scotia Company, a Nova Scotia unlimited liability company and successor by assignment to the
Domestic Borrower under the ARAM Purchase Agreement, made to the favor of the sellers of ARAM
and certain of its Affiliates pursuant to the terms of the ARAM Purchase Agreement.

“Canadian Dollars” refers to lawful money of Canada.

“Domestic Lenders” means, collectively, the Domestic Revolving Lenders and the Term Loan
Lenders.

“Domestic Loans” means collectively, the Domestic Revolving Loans and the Term Loans.

“First Amendment” means that certain First Amendment to Credit Agreement and Domestic
Security Agreement, dated as of September 17, 2008, by and among the Domestic Borrower,

5

 

Foreign Borrower, the Guarantors party thereto, the Lenders party thereto, and the
Administrative Agent.

“First Amendment Effective Date” means September 17, 2008.

“Interim Junior Financing” means one or more interim or bridge loans or financings,
including, without limitation, the Short Term Interim Junior Financing, in a principal amount
not exceeding $150,000,000 at any time outstanding, issued by any party to the Domestic Borrower
as an intermediate financing vehicle to be refinanced or repaid from the proceeds of, or
converted into, the Long Term Junior Financing on terms reasonably satisfactory to the
Administrative Agent.

“Junior Financing” means the Interim Junior Financing or the Long Term Junior Financing,
as applicable.

“Long Term Junior Financing” means (i) the unsecured notes or debentures in the original
principal amount of up to $175,000,000, anticipated on the First Amendment Effective Date to be
issued by the Domestic Borrower and underwritten by Jefferies & Company and/or Jefferies Finance
or any Affiliate of either, or (ii) any extension of the Interim Junior Financing beyond the
first anniversary thereof, which, in each case, shall have a stated maturity date of not less
than five (5) years after the original date of issuance and shall be on terms reasonably
satisfactory to the Administrative Agent.

“Revolving Lender” means a Lender making Revolving Loans hereunder.

“Short Term Interim Junior Financing” means one or more unsecured loans, with a maturity
date of no later than December 31, 2008, and in an original principal amount not exceeding
$41,000,000, made by any party to the Domestic Borrower as an intermediate financing vehicle to
be repaid from the proceeds of any other Interim Junior Financing or the Long Term Junior
Financing, on terms reasonably satisfactory to the Administrative Agent.

“Term Loan” means any Loans made pursuant to Section 2.01(e) hereof.

“Term Loan Commitment” means, with respect to each Term Loan Lender, the commitment of
such Lender to make its Term Loan. The amount of each Term Loan Lender’s Term Loan Commitment
is set forth on Schedule 2.01, or in the Assignment and Assumption pursuant to which
such Lender shall have assumed its Term Loan Commitment, as applicable. The initial aggregate
amount of the Term Loan Lenders’ Term Loan Commitments is $125,000,000.

“Term Loan Lender” means a Lender making a portion of the Term Loans hereunder.

“Term Loan Maturity Date” means September 17, 2013, provided, the Administrative
Agent may accelerate the maturity date of the Term Loans such that the Term Loan Maturity Date
shall be the Advanced Maturity Date if the Junior Financing is not either paid in full or
refinanced on or prior to the Advanced Maturity Date pursuant to terms reasonably satisfactory
to the Administrative Agent, said acceleration to be effective upon written notice given to the
Domestic Borrower by the Administrative Agent no later than thirty (30) days following the
fourth anniversary date of the First Amendment Effective Date.

     (iii) Section 1.01 is hereby further amended by changing the reference
in “Change in Law” from “Section 2.14(b)” to “Section 2.13(b)”.

6

 

          (b) Amendment to Section 2.01. Section 2.01 is hereby amended by
deleting Section 2.01 in its entirety and restating Section 2.01 to read as follows:

     “SECTION 2.01 Commitments. (a) Subject to the terms and conditions set
forth herein, each Revolving Lender agrees to make Revolving Loans to a Borrower
from time to time during the Availability Period in an aggregate principal amount up
to such Lender’s Revolving Loan Commitment. Within the foregoing limits and subject
to the terms and conditions set forth herein, each Borrower may borrow, prepay and
reborrow Revolving Loans.”

     “(b) Subject to Section 2.18, Revolving Loans may, at the option of the
Domestic Borrower, be requested in an aggregate amount of not more than $75,000,000
or an Equivalent Amount in an Alternative Currency calculated as of the date such
Loans are requested (each a “Domestic Revolving Loan”), provided,
for the period commencing on the First Amendment Effective Date and ending on the
date of the funding of the Junior Financing (other than the Short Term Interim
Junior Financing), but in no event later than December 31, 2008, an aggregate amount
of up to $110,000,000 of the Revolving Loan Commitment may be requested and advanced
in Dollars notwithstanding anything to the contrary in Section 2.18(h),
provided further, until the closing of the ARAM Acquisition
(including the payment of the cash portion of the consideration therefor), said
amount shall be $85,000,000 plus the maximum amount available to be drawn under any
Letters of Credit outstanding on the First Amendment Effective Date.

     “(c) Subject to Section 2.18, Revolving Loans may, at the option of the
Foreign Borrower, be requested in an aggregate amount of not more than $60,000,000
or an Equivalent Amount in an Alternative Currency calculated as of the date such
Loans are requested (each a “Foreign Revolving Loan”).”

     “(d) Notwithstanding the foregoing clauses (b) and (c), the aggregate principal
amount of all Foreign Revolving Loans and all Domestic Revolving Loans, including
the total LC Exposure at any time outstanding, shall not exceed the total of all of
the Revolving Lenders’ Revolving Loan Commitments.”

     “(e) Subject to the terms and conditions set forth herein, each Term Loan
Lender agrees to make a single Term Loan to the Domestic Borrower on any Business
Day during the applicable Availability Period, in an aggregate principal amount of
up to such Lender’s Term Loan Commitment. The Term Loans shall be advanced in a
single advance made by each Term Loan Lender in Dollars and the Term Loan
Commitments shall automatically expire following said advance, provided that
the Domestic Borrower shall continue to be able to continue or convert Term Loan
Borrowings from one Type to another at the end of any applicable Interest Period,
assuming no Default has occurred and is continuing. Amounts borrowed as Term Loans
and repaid or prepaid may not be reborrowed.”

7

 

          (c) Amendment to Section 2.02. Section 2.02 is hereby amended by
re-lettering paragraphs (b), (c) and (d) thereof as paragraphs (c), (d) and (e)
respectively, and restating paragraph (a) in its entirety, and adding a new paragraph (b),
each to read as follows:

     “(a) Each Revolving Loan and any continuations of any Interest Periods
thereunder or conversions from one Type of Borrowing to another shall be made as
part of a Borrowing consisting of Revolving Loans made by the Revolving Lenders
ratably in accordance with their respective Revolving Loan Commitments. The failure
of any Revolving Lender to make any Revolving Loan required to be made by it shall
not relieve any other Revolving Lender of its obligations hereunder;
provided that the Revolving Loan Commitments of the Revolving Lenders are
several and no Revolving Lender shall be responsible for any other Revolving
Lender’s failure to make Revolving Loans as required.”

     “(b) The Term Loans and any continuations of any Interest Periods thereunder or
conversions from one Type of Borrowing to another shall be made ratably by the Term
Loan Lenders in accordance with their respective Term Loan Commitments. The failure
of any Term Loan Lender to make its Term Loan shall not relieve any other Term Loan
Lender of its obligations hereunder, provided the Term Loan Commitments of
the Term Loan Lenders are several and no Term Loan Lender shall be responsible for
the obligations of any other Term Loan Lender.”

          (d) Amendment to Section 2.03. Section 2.03 is hereby amended by
deleting the word “Revolving” in the first line thereof.

          (e) Amendment to Section 2.04. Section 2.04 is hereby amended by
replacing each reference to “Lender”, “Lender’s”, “Lenders’” and “Lenders” therein that is
not preceded by the word “Issuing” with a reference to “Revolving Lender”, “Revolving
Lender’s”, “Revolving Lenders’” and “Revolving Lenders”, respectively.

          (f) Amendment to Section 2.07. Section 2.07 is hereby amended by
replacing each reference therein to “Lenders’” and “Lenders” with a reference to “Revolving
Lenders’” and “Revolving Lenders”, respectively.

          (g) Amendment to Section 2.08. Section 2.08 is hereby amended by
relettering paragraphs (b) through (g) as paragraphs (c) through (h), respectively (and all
references in the Credit Agreement to such paragraphs shall be relettered accordingly), by
restating paragraph (a) in its entirety, restating paragraph (f) (formerly paragraph (e)) in
its entirety, and by inserting a new paragraph (b), each to read as follows:

     “(a) Each Borrower hereby unconditionally promises to pay to the Administrative
Agent for the account of each Revolving Lender the then unpaid principal amount of
each Revolving Loan made to such Borrower on the Revolving Credit Termination Date.
In addition, the Domestic Borrower promises to repay all amounts borrowed as
Revolving Loans that are used to fund

8

 

the ARAM Acquisition from the proceeds received from any Junior Financing
(other than from the Short Term Interim Junior Financing) promptly following the
funding thereof, or if there is no such funding, upon the cancellation of the
commitment to provide such Junior Financing, and, in any event, irrespective of any
commitment for, or funding of, such Junior Financing, on or before
December 31, 2008.

     “(b) The Domestic Borrower hereby unconditionally promises to pay to the
Administrative Agent for the account of each Term Loan Lender the then aggregate
unpaid principal amount of the Term Loans made to such Borrower on the Term Loan
Maturity Date. In addition, the principal balance of the Term Loan shall be repaid
in installments paid quarterly in amounts shown on the schedule below, said payments
to be made on the last Business Day of each fiscal quarter commencing on December
31, 2008.”

	 	 	 	 	 
	December 31, 2008
	 	$	4,687,500	 
	March 31, 2009
	 	$	4,687,500	 
	June 30, 2009
	 	$	4,687,500	 
	September 30, 2009
	 	$	4,687,500	 
	December 31, 2009
	 	$	4,687,500	 
	March 31, 2010
	 	$	4,687,500	 
	June 30, 2010
	 	$	4,687,500	 
	September 30, 2010
	 	$	4,687,500	 
	December 31, 2010
	 	$	6,250,000	 
	March 31, 2011
	 	$	6,250,000	 
	June 30, 2011
	 	$	6,250,000	 
	September 30, 2011
	 	$	6,250,000	 
	December 31, 2011
	 	$	6,250,000	 
	March 31, 2012
	 	$	6,250,000	 
	June 30, 2012
	 	$	6,250,000	 
	September 30, 2012
	 	$	6,250,000	 
	December 31, 2012
	 	$	9,375,000	 
	March 31, 2013
	 	$	9,375,000	 
	June 30, 2013
	 	$	9,375,000	 
	September 17, 2013
	 	$	9,375,000	 

     “(f) If at any time Administrative Agent notifies (i) the Domestic Borrower in
writing that the amount of all Domestic Revolving Loans outstanding exceeds the
Revolving Loan Commitments then in effect with respect to Domestic Revolving Loans
pursuant to Section 2.01(b) (as may be proportionally increased or otherwise
modified pursuant to Section 2.18(h)) or (ii) the Foreign Borrower in
writing that the amount of all Foreign Revolving Loans outstanding exceeds the
Revolving Loan Commitments then in effect with respect to Foreign Revolving Loans
pursuant to Section 2.01(c) (as may be proportionally increased or otherwise
modified pursuant to Section 2.18(h)), or, in either case, the

9

 

Equivalent Amount in an Alternative Currency, the applicable Borrower shall,
within ten (10) days of such notice, either (at the applicable Borrower’s option)
repay the applicable Loans or deposit cash in an account with the Administrative
Agent until the end of the applicable Interest Period, in either case, in an
aggregate amount sufficient to reduce such amount outstanding as of such date of
payment such that amount outstanding does not exceed the Revolving Lenders’
Revolving Loan Commitments or an Equivalent Amount in an Alternative Currency.”

     (h) Amendment to Section 2.09. Section 2.09 is hereby amended by
replacing the text “Lenders” in the third sentence of paragraph (c) thereof with the text
“Revolving Lenders”.

     (i) Amendment to Section 2.10. Section 2.10 is hereby amended by
replacing the text “each Lender” in each place such text appears in paragraphs (a) and (b)
of Section 2.10 with the text “each Revolving Lender”, relettering paragraphs (d) and (e) as
(e) and (f), respectively, restating paragraph (c) in its entirety, and inserting a new
paragraph (d), each to read as follows:

     “(c) The Domestic Borrower shall pay to the Administrative Agent or the Term
Loan Arrangers, as applicable, for their own account, or otherwise to be distributed
as determined by said Arrangers, fees payable in the amounts and at the times
specified in Commitment Letter for the Term Loan dated as of July 7, 2008 and the
Fee Letters, or otherwise separately agreed upon, between the Domestic Borrower and
any of said parties.

     “(d) In the event the Term Loan is not funded within ten (10) Business Days of
the First Amendment Effective Date (other than as a result of any Term Loan Lender’s
default under Section 2.01(e)), the Domestic Borrower shall pay to the
Administrative Agent, for the account of each Term Loan Lender, a commitment fee
equal to 0.50% per annum on the aggregate amount of the Term Loan Commitments, such
fee to accrue only during the period from and after said tenth Business Day until
the earlier to occur of (i) the funding of the Term Loans and (ii) the expiration of
the Availability Period with respect to the Term Loans.”

     (j) Amendment to Section 2.11. Section 2.11 is hereby amended by
restating paragraphs (a), (b) and (c) in their entirety to read as follows:

     “(a) Subject to Section 10.13, the Revolving Loans comprising each ABR
Borrowing shall bear interest at the Alternate Base Rate plus the Applicable Margin
for Revolving Loans and any ABR Borrowing of the Term Loans shall bear interest at
the Alternate Base Rate plus the Applicable Margin for the Term Loans.

     “(b) Subject to Section 10.13, the Revolving Loans comprising each
Eurodollar Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest
Period in effect for such Borrowing plus the Applicable Margin for

10

 

Revolving Loans and any Eurodollar Borrowing of the Term Loans shall bear
interest at the Adjusted LIBO Rate for the Interest Period in effect for such
Borrowing plus the Applicable Margin for the Term Loans.

     “(c) The Loans comprising each Alternative Currency Loan shall bear interest at
the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Margin for Revolving Loans.”

          (k) Amendment to Section 2.12. Section 2.12 is hereby amended by
restating the first sentence thereof in its entirety prior to
paragraphs 
     (a) and (b) to read
as follows:

     “SECTION 2.12 Alternate Rate of Interest. If prior to the
commencement of any Interest Period for a Borrowing based on the Adjusted LIBO
Rate:”

       (l) Amendment to Section 2.18. Section 2.18 is hereby amended by
replacing each reference therein to “Lender”, “Lender’s”, “Lenders’” and “Lenders” that is
not preceded by the word “New” with a reference to “Revolving Lender”, “Revolving Lender’s”,
“Revolving Lenders’” and “Revolving Lenders”, respectively, and by restating paragraph (h)
to read as follows:

     “(h) Upon the effectiveness of any Commitment Increase Agreement or pursuant to
Section 3 of the First Amendment, Section 2.08(c), Schedule 2.01 and
other pertinent sections hereof shall be automatically and proportionately modified
to reflect (i) the increased Revolving Loan Commitment, (ii) the increase in the
available aggregate amount of Domestic Revolving Loans, which shall not exceed 75%
of the increased Revolving Loan Commitment (except as otherwise provided in the
proviso of Section 2.01(b)) and (iii) the increase in the available
aggregate amount of Foreign Revolving Loans, which shall not exceed 60% of the
increased Revolving Loan Commitment, each as agreed between the Borrowers and the
Administrative Agent, and all references to the foregoing shall be deemed amended
mutatis mutandis.”

     (m) Amendment to Article IV. Article IV is hereby amended by inserting the
following new Section 4.03:

     “SECTION 4.03. The obligations of the Term Loan Lenders to make Term Loans and
of the Revolving Lenders to make Domestic Revolving Loans in an aggregate
outstanding principal amount in excess of $75,000,000 or an Equivalent Amount
computed in an Alternative Currency or to make Foreign Revolving Loans in an
aggregate outstanding principal amount in excess of $60,000,000 or an Equivalent
Amount computed in an Alternative Currency hereunder is subject to each of the
following conditions:”

     “(a) The First Amendment shall be effective pursuant to Section 5 thereof.”

     “(b) All closing conditions to the consummation of the ARAM Acquisition, as set
forth in the ARAM Purchase Agreement, shall have been

11

 

satisfied or waived, except for the payment by the Domestic Borrower of the
consideration therefor and the Administrative Agent shall have received a
certificate from the Domestic Borrower so stating.”

     (n) Amendment to Article V and Article VI. The lead-in to each of Article V
and Article VI is hereby amended and restated to read as follows:

     “Until the Revolving Loan Commitments and the Term Loan Commitments have
expired or been terminated and the principal of and interest on each Loan and all
fees payable hereunder shall have been paid in full and all Letters of Credit shall
have expired or terminated (except as expressly permitted to extend past the
Revolving Credit Termination Date pursuant to Section 2.04(c)) and all LC
Disbursements shall have been reimbursed, each Borrower, for itself and its
Subsidiaries, and each Guarantor, for itself, covenants and agrees with the Lenders
that:”

     (o) Amendment to Section 5.08. Section 5.08 is hereby restated in its
entirety to read as follows:

     “SECTION 5.08 Use of Proceeds and Letters of Credit. Each Borrower
covenants and agrees that the proceeds of the Loans will be used only to (i) finance
acquisitions, investments and share repurchases, including the ARAM Acquisition;
(ii) pay the fees, expenses and other transaction costs of the transactions
contemplated hereby (including in connection with the ARAM Acquisition); and (iii)
in regard to the Revolving Loans only, fund working capital needs and general
corporate purposes of each Borrower and its respective Subsidiaries. Each Borrower
covenants and agrees that no part of the proceeds of any Loan will be used, whether
directly or indirectly, (a) to repay any principal amount outstanding under the
Junior Financing as the same comes due or (b) for any purpose that entails a
violation of any of the Regulations of the Board, including Regulations T, U and X.
Letters of Credit will be issued only to support the working capital needs and
general corporate obligations of such Borrower and its Subsidiaries relating to
their respective lines of business as currently conducted.”

     (p) Amendment to Section 5.15. Section 5.15 is hereby amended by adding a new
paragraph (c) to read as follows:

     “(c) Foreign Borrower will not allow the sum total of all bank deposits held
by it or any of its Affiliates or Subsidiaries in Luxembourg to be greater than
$200,000 (or an equivalent amount in any other currency) and will establish and
maintain a system to transfer all sums in excess of such limit to an account with a
financial institution with which the Agent has a perfected security interest within
three (3) local business days (defined as days on which commercial banks are
generally open in Luxembourg).”

12

 

     (q) Amendment to Section 5.17. A new Section 5.17 is hereby added to
the Credit Agreement to read as follows:

     “SECTION 5.17 Funding of ARAM Acquisition. No later than the earliest
of (i) the funding date of the Junior Financing (other than the Short Term Interim
Junior Financing), (ii) the stated termination or expiration date of the commitment
for any such Junior Financing (other than the Short Term Interim Junior Financing)
if the same has not been funded, and (iii) December 31, 2008, the Domestic Borrower
will have cash on hand, which may include the proceeds of the Junior Financing
(other than the Short Term Interim Junior Financing), sufficient to, and will: (a)
repay Revolving Loans the proceeds of which were used to finance the ARAM
Acquisition, and (b) make any remaining payments to the sellers of ARAM (including
repayment of the ARAM Sellers’ Note and/or funding such sellers’ $35,000,000 escrow
account in regard to the ARAM Acquisition).”

     (r) Amendment to Section 6.01. Section 6.01 of the Credit Agreement is hereby
amended by amending and restating paragraph (l) thereof in its entirety, by deleting the
word “and” at the end of the existing paragraph (p), amending and restating paragraph (q) in
its entirety, and inserting new paragraphs (r) and (s), each to read as follows:

     “(l) Subordinated Indebtedness, provided, so long as the ARAM Sellers’ Note is
outstanding, such Subordinated Indebtedness shall be limited to a maximum of
$25,000,000;

     (q) Indebtedness of the Domestic Borrower under a Junior Financing;”

     “(r) Indebtedness of the Domestic Borrower or any Subsidiary under the ARAM
Sellers’ Note and any guarantee thereof; and”

     “(s) Anything herein to the contrary notwithstanding, the Indebtedness
permitted in paragraphs (g), (i), (j), (p), (q) and (r) of this Section 6.01
shall not in the aggregate exceed $350,000,000 at any time outstanding.”

     (s) Additional Amendments to Section 6.01. Section 6.01 of the Credit
Agreement is hereby further amended by deleting the references in clauses (g), (i), (j) and
(p) to “Section 6.01(q)” and inserting in place thereof in each such clause a
reference to “Section 6.01(s)”, and by inserting the following new paragraph
immediately following the new clause (s) set forth in the preceding Section 2(r) of this
Amendment:

“Notwithstanding the foregoing, the Domestic Borrower and the Foreign Borrower each
agrees that, to the extent that any of the documents or agreements governing any
Junior Financing imposes upon the Borrowers any covenant with respect to the
incurrence or maintenance of Indebtedness that is more restrictive on either
Borrower or its respective Subsidiaries than this Section 6.01, then such
more restrictive covenant shall be deemed to be incorporated herein by reference

13

 

for the benefit of the Lenders, and shall continue in effect for purposes of this
Agreement until the Long Term Junior Financing has been repaid, refinanced, extended
or converted, regardless of any termination or any amendment or waiver of, or any
consent to any deviation from, or any modification of, the documents or agreements
governing any Junior Financing.”

     (t) Amendment to Section 6.04. Section 6.04 is hereby amended by
deleting paragraph (g) thereof in its entirety and restating it as follows:

     “(g) any Asset Sale in an aggregate amount not to exceed the greater of
$40,000,000 or ten percent (10%) of Net Worth in any twelve (12) month period, and
in no event to exceed $100,000,000 over the term hereof, so long as after giving
effect to such Asset Sale, the Domestic Borrower is in pro forma compliance with the
covenants in Sections 6.14, 6.15 and 6.16; provided, that until the full and final
repayment of all of the Interim Junior Financing, said limit shall be deemed to be
the lesser of the foregoing amount or the maximum amount that would not trigger any
required or mandatory payment, repurchase or redemption required under any agreement
or document governing the Interim Junior Financing.”

     (u) Amendment to Section 6.05. Section 6.05 of the Credit Agreement is hereby
amended by restating paragraph (e) in its entirety, deleting the word “and” at the end of
the existing paragraph (k), replacing the period at the end of the existing paragraph (m)
with “; and” and inserting a new paragraph (n), each to read as follows:

     “(e) Subject to the provisions of Section 6.05(m), so long as there is at least
$25,000,000 in unused Revolving Loan Commitments, exclusive of outstanding Letters
of Credit, prior to giving effect to such Investment, Investments in Subsidiaries in
the same or similar line of business as the Borrowers and their Subsidiaries, or in
other entities that do not constitute Subsidiaries, so long as such Investments do
not exceed in any twelve (12) month period the lesser of twenty five percent (25%)
of Net Worth and $200,000,000 (exclusive of the ARAM Acquisition); provided,
if such additional amount is funded by new equity issuances in Domestic Borrower,
such Investments do not exceed in any twelve (12) month period fifty percent (50%)
of Net Worth;”

     “(n) Investments by the Domestic Borrower in Equity Interests in ARAM and
Canadian Seismic Rentals Inc. as contemplated by the ARAM Acquisition.”

     (v) Amendment to Section 6.07. Section 6.07 of the Credit Agreement is hereby
amended by (i) deleting the lead-in to Section 6.07 and restating it in its entirety to read
as follows:

     “SECTION 6.07 Restricted Payments and Subordinated Indebtedness. The
Borrowers will not, and will not permit any of their respective Subsidiaries

14

 

to, declare or make, or agree to pay or make, any Restricted Payment or make
any principal payments on any Subordinated Indebtedness, except:”

     ; and (ii) by deleting the word “and” at the end of the existing paragraph (e),
replacing the period at the end of the existing paragraph (f) with a semicolon and inserting
new paragraphs (g) and (h), each to read as follows:

     “(g) subject to the provisions of Section 5.08, so long as no Event of
Default would result therefrom after giving effect thereto: (i) repayment of the
Short Term Interim Junior Financing with the proceeds of any other Junior Financing,
(ii) so long as the Borrowers are in compliance with Section 5.17, repayment
of the Interim Junior Financing other than the Short Term Interim Junior Financing,
with (v) the proceeds of any Long Term Junior Financing, (w) the issuance of equity
of the Domestic Borrower or any of its subsidiaries otherwise permitted hereunder,
(x)  Indebtedness otherwise permitted hereunder, (y) insurance or condemnation
payments and (z) any Asset Sale (subject to the limitations of Section 6.04(g)), in
each case, to the extent required by the documentation evidencing said Interim
Junior Financing and subject to Lender’s rights with respect to any such payments or
proceeds, (iii) regularly scheduled payments of interest on the Subordinated
Indebtedness and the Long Term Junior Financing and (iv) any required or mandatory
payment, repurchase or redemption at the maturity date thereof (regardless of how
such maturity date may be brought about) or upon the occurrence of a Change of
Control (or other change in control however defined) in each case, under the
governing documents for any Junior Financing then outstanding (provided that, for
the avoidance of doubt, this clause (iv) shall not permit any optional or voluntary
payment, repurchase or redemption of Indebtedness outstanding under any Long Term
Junior Financing); and

     “(h) subject to the provisions of Section 5.08, 3226509 Nova Scotia
Company, as long as no Event of Default has occurred and is continuing or would
exist after giving effect thereto, pay principal and interest pursuant to the terms
and conditions of the ARAM Sellers’ Note.”

     (w) Amendment to Section 6.09. Section 6.09 is hereby amended and restated as
follows:

     “SECTION 6.09 Restrictive Agreements. The Borrowers will not, and
will not permit any of their respective Subsidiaries to, directly or indirectly,
enter into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (a) the ability of such Borrower
or any of its respective Subsidiaries to create, incur or permit to exist any Lien
upon any of its property or assets, or (b) the ability of any Obligor to pay
dividends or other distributions with respect to any shares of its capital stock (to
the extent the holder of such shares is an Obligor) or to make or repay loans or
advances to such Borrower or any Guarantor or to guarantee Indebtedness of such
Borrower or any Guarantor; provided that (i) the foregoing shall not apply to
restrictions and conditions imposed by Law or by this Agreement, (ii) the foregoing
shall not

15

 

apply to restrictions and conditions existing on the date hereof identified on
Schedule 6.09 (but shall apply to any extension or renewal of, or any
amendment or modification expanding the scope of, any such restriction or
condition), (iii) the foregoing shall not apply to customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary of a
Borrower pending such sale, provided such restrictions and conditions apply only to
the Subsidiary that is to be sold and such sale is permitted hereunder, (iv)
paragraph (a) of the foregoing shall not apply to restrictions or conditions imposed
by any agreement relating to secured Indebtedness permitted by this Agreement if
such restrictions or conditions apply only to the property or assets securing such
Indebtedness, (v) paragraph (a) of the foregoing shall not apply to customary
provisions in leases and other contracts restricting the assignment thereof, and
(vi) the foregoing shall not apply to restrictions or conditions contained in the
agreements related to the Junior Financing or the ARAM Sellers’ Note or any
guarantee thereof.”

     (x) Amendment to Section 6.16. Section 6.16 is hereby amended and
restated as follows:

     “SECTION 6.16 Minimum Tangible Net Worth. The Domestic Borrower and
its Subsidiaries shall maintain a minimum Tangible Net Worth of not less than 80% of
the Tangible Net Worth as of the date of the ARAM Acquisition (provided that until
the ARAM Acquisition is consummated or in the event such acquisition does not occur
prior to November 1, 2008, such date shall be March 31, 2008) plus (i) 50% of the
Consolidated Net Income of Borrowers and their respective Subsidiaries (if positive)
for each fiscal quarter thereafter and (ii) 80% of the net proceeds from any
mandatorily convertible notes and preferred and common stock issuances for each
fiscal quarter thereafter.”

     (y) Amendment to Section 7.01. Section 7.01 is hereby amended by
restating paragraphs (d) and (f) in their entirety, each to read as follows:

     “(d) the Borrowers shall fail to observe or perform any covenant, condition or
agreement contained in Sections 5.01, 5.02, 5.03 (with
respect to the Domestic Borrower’s existence), 5.08 or 5.17 or in
Article VI (other than those referenced in (e) and (f), below);”

     “(f) any Borrower or any Subsidiary shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material
Indebtedness, including without limitation the Junior Financing or the ARAM Sellers’
Note, when and as the same shall become due and payable after giving effect to any
applicable grace period.”

     (z) Amendment to Article IX. References in Article IX to “Domestic Revolving
Loans” shall, from and after the date hereof, mean and refer to “Domestic Loans”.
References in Article IX to “Domestic Revolving Lender” or “Domestic

16

 

Revolving Lenders” shall, from and after the date hereof, mean and refer to “Domestic
Lender”.

       (aa) Amendment of Section 10.04. Section 10.04 is hereby amended by restating
sub-paragraphs (b)(i)(A) and (b)(i)(B) in their entirety to read as follows:

               “(A) the Borrowers, provided that no such consent of the Borrowers
shall be required for an assignment of any Revolving Loan Commitment to an assignee
that is a Revolving Lender immediately prior to giving effect to such assignment, an
Affiliate of a Revolving Lender immediately prior to giving effect to such
assignment or any Approved Fund, or for an assignment of any Term Loan to an
assignee that is a Term Loan Lender immediately prior to giving effect to such
assignment or an Affiliate of a Term Loan Lender immediately prior to giving effect
to such assignment, or, if an Event of Default has occurred and is continuing, any
other assignee, and”

               “(B) the Administrative Agent and, in the case of any assignment of Revolving
Loans or Revolving Term Loan Commitments, the Issuing Lender, provided that
no such consent shall be required for an assignment of any Revolving Loan Commitment
to an assignee that is a Revolving Lender or an Affiliate of a Revolving Lender, in
each case, with a Revolving Loan Commitment immediately prior to giving effect to
such assignment or for an assignment of any Term Loan to an assignee that is a Term
Loan Lender or an Affiliate of a Term Loan Lender, in each case, with Term Loans
owing to it immediately prior to giving effect to such assignment;”

        (bb) Amendment to Schedule 2.01. Schedule 2.01 is hereby restated and replaced
by the Schedule 2.01 attached hereto as Exhibit A.

        (cc) Amendment to Schedule 5.16. Schedule 5.16 is hereby restated and replaced
by the Schedule 5.16 attached hereto as Exhibit B.

      3. Increase of Revolving Credit Commitments. All parties hereto acknowledge that
pursuant to Section 2.18 of the Credit Agreement, a Commitment Increase Notice has been
given by the Domestic Borrower, that, in addition, this Amendment serves as a Commitment Increase
Agreement, that as of the First Amendment Effective Date, the Revolving Credit Commitment has been
increased to $110,000,000, that HSBC Bank Canada has executed a New Lender Agreement setting forth
its Revolving Loan Commitment in the amount of $10,000,000, and that the maximum balance available
to be requested by both Borrowers collectively under Section 2.18 is now $40,000,000.

      4. Amendment to Domestic Security Agreement. The Domestic Security Agreement is
hereby amended by restating the definition of Secured Obligations contained therein to read as
follows:

     “Secured Obligations” means (i) all Obligations of the Domestic Borrower or any
of the Domestic Guarantors with respect to, or arising out of, the Domestic Loans, (ii) all
duties, obligations and liabilities of the Domestic Borrower or any of its Domestic

17

 

Subsidiaries of any kind under any Permitted Swap Agreement and (iii) all obligations
and liabilities of the Domestic Borrower or any of its Domestic Subsidiaries owing to any
Lender under bank cards, foreign exchange or other similar bank products, in the case of
each of the foregoing clauses (i) through (iii), whether now or hereafter existing owing by
the Domestic Borrower or any of the Domestic Guarantors, including any extensions,
modifications, substitutions, amendments and renewals thereof, whether for principal,
interest, fees, expenses, indemnification, or otherwise, including all costs and expenses
(including reasonable attorneys’ fees and expenses) incurred by the Administrative Agent or,
after an Event of Default, any Secured Party in connection with any suit or proceeding in
connection with the performance by such Secured Party of any of the agreements contained in
any of the Contracts, or in connection with any exercise of its rights or remedies
hereunder, pursuant to the terms of this Security Agreement; provided,
however, that to the extent that the assets of any Debtor party hereto are all or
substantially all comprised of stock or securities in one or more Foreign Subsidiaries, the
Secured Obligations of such Debtor hereunder shall be limited as set forth in Section
9.01(d) of the Credit Agreement.”

     5. Conditions to Effectiveness. This Amendment shall be effective on the First
Amendment Effective Date upon satisfaction of each of the following conditions:

     (i) The Administrative Agent (or its counsel) shall have received from each
party hereto either (a) a counterpart of this Amendment signed on behalf of such
party or (b) written evidence satisfactory to the Administrative Agent (which may
include telecopy transmission of a signed signature page of this Amendment) that
such party has signed a counterpart of this Amendment.

     (ii) The Administrative Agent shall have received a favorable written opinion
(addressed to the Administrative Agent and the Lenders and dated the First Amendment
Effective Date) of (a) David L. Roland, Esq., general counsel of the Domestic
Borrower, and (b) Mayer Brown LLP, New York counsel for the Domestic Borrower.

     (iii) The Administrative Agent shall have received such documents and
certificates as the Administrative Agent or its counsel may reasonably request
relating to the organization, existence and good standing of the Domestic Borrower
and the Domestic Guarantors (collectively, the “Domestic Obligors”), the
authorization of the transactions contemplated by this Amendment, the authority of
each natural Person executing any of the Loan Documents on behalf of any Domestic
Obligor and any other legal matters relating to the Domestic Obligors, this
Agreement or the transactions contemplated by this Amendment, all in form and
substance reasonably satisfactory to the Administrative Agent and its counsel.

     (iv) Each Lender requesting a promissory note evidencing such Lender’s Term
Loans or the increased Revolving Loan Commitment of such Lender shall have received
from the applicable Borrower(s) one or more Notes payable to such Lender.

18

 

     (v) The Lenders, the Administrative Agent and the Arrangers shall have received
all fees and other amounts due and payable on or prior to the First Amendment
Effective Date, including reimbursement or payment of all reasonable out-of-pocket
expenses required to be reimbursed or paid by the Domestic Borrower hereunder to the
extent that invoices have been provided to the Domestic Borrower in advance of such
First Amendment Effective Date.

     (vi) All material governmental and third party approvals necessary or, in the
reasonable discretion of the Administrative Agent, advisable in connection with the
financing contemplated hereby and the continuing operations of the Domestic Borrower
and its Subsidiaries shall have been obtained and be in full force and effect.

     (vii) The Lenders shall have received (a) audited consolidated financial
statements of the Domestic Borrower and its Subsidiaries for the two most recent
fiscal years ended prior to the Effective Date as to which such financial statements
are available, (b) satisfactory unaudited interim consolidated financial statements
of the Domestic Borrower and its Subsidiaries for the fiscal quarter ended June 30,
2008, and (c) a Compliance Certificate, indicating, among other things, pro-forma
compliance with Sections 6.14, 6.15 and 6.16 following the
ARAM Acquisition (based on the most recent unaudited financial statements of ARAM).

     (viii) Commitments from financial institutions satisfactory to the Agent, in an
amount required to fund the increased Revolving Loan Commitment, shall have been
obtained.

     (ix) The Administrative Agent shall have received all documents and other items
that it may reasonably request in writing relating to any other matters relevant
hereto, all in form and substance satisfactory to the Administrative Agent.

     (x) No Default or Event of Default exists.

          6. Representations and Warranties. Each Borrower and each Guarantor hereby confirms
that the representations and warranties contained in the Credit Agreement and the other Loan
Documents made by it are true and correct as of the date hereof, except to the extent such
representations and warranties specifically relate to an earlier date, in which case they were true
and correct as of such earlier date. Each Borrower and each Guarantor also hereby confirm that
this Amendment has been duly authorized by all necessary corporate action and constitutes the
binding obligation of each of the Borrowers and the Guarantors, subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’
rights and remedies generally and to the effect of general principles of equity (regardless of
whether enforcement is considered in a proceeding at Law or in equity).

          7. Continuing Effect of the Credit Agreement. This Amendment shall not constitute a
waiver of any provision not expressly referred to herein and shall not be construed as a consent

19

 

to any action on the part of the Borrowers or Guarantors that would require a waiver or
consent of the Lenders or an amendment or modification to any term of the Loan Documents except as
expressly stated herein. Except as expressly modified hereby, the provisions of the Credit
Agreement and the Loan Documents are and shall remain in full force and effect.

          8. Ratification. The Domestic Borrower and each Domestic Guarantor hereby confirm and
ratify the Credit Agreement and each of the other Loan Documents to which it is a party, as amended
hereby, and acknowledges and agrees that the same shall continue in full force and effect, as
amended hereby, and by any prior amendments thereto. The Foreign Borrower and each Foreign
Guarantor hereby confirm and ratify the Credit Agreement and each of the other Loan Documents to
which it is a party, as amended hereby, and acknowledges and agrees that the same shall continue in
full force and effect, as amended hereby, and by any prior amendments thereto. For the avoidance
of doubt, each Domestic Guarantor hereby unconditionally guarantees the full, final and complete
repayment of the Term Loan to the same extent it has guarantied the Revolving Loan as set forth in
the Credit Agreement.

          9. Counterparts. This Amendment may be executed by all parties hereto in any number
of separate counterparts each of which may be delivered in original, electronic or facsimile form
and all of such counterparts taken together shall be deemed to constitute one and the same
instrument.

          10. References. The words “hereby,” “herein,” “hereinabove,” “hereinafter,”
“hereinbelow,” “hereof,” “hereunder” and words of similar import when used in this Amendment shall
refer to this Amendment as a whole and not to any particular article, section or provision of this
Amendment. References in this Amendment to an article or section number are to such articles or
sections of this Amendment unless otherwise specified.

          11. Headings Descriptive. The headings of the several sections and subsections of
this Amendment are inserted for convenience only and shall not in any way affect the meaning or
construction of any provision of this Amendment.

          12. Governing Law. This Amendment shall be governed by and construed in accordance
with the law of the State of New York, without regard to such state’s conflict of laws rules.

          13. Release by Borrowers and Guarantors. Each Borrower and each Guarantor does hereby release and forever discharge the Agent and
each of the Lenders and each affiliate thereof and each of their respective employees, officers,
directors, trustees, agents, attorneys, successors, assigns or other representatives from any and
all claims, demands, damages, actions, cross-actions, causes of action, costs and expenses
(including legal expenses), of any kind or nature whatsoever known to any Obligor, whether based on
law or equity, which any of said parties has held or may now own or hold, for or because of any
matter or thing done, omitted or suffered to be done on or before the actual date upon which this
Amendment is signed by any of such parties (i) arising directly or indirectly out of the Credit
Agreement, Loan Documents, or any other documents, instruments or any other transactions relating
thereto and/or (ii) relating directly or indirectly to all transactions by and between the Borrowers or Guarantors or their representatives and the Agent and each Lender or
any of their respective directors, officers, agents, employees,

20

 

attorneys or other representatives
and, in either case, whether or not caused by the sole or partial negligence of any indemnified
party. Such release, waiver, acquittal and discharge shall and does include any claims of any kind
or nature which may, or could be, asserted by any of the Borrowers or Guarantors.

          14. Final Agreement of the Parties. THIS AMENDMENT, THE CREDIT AGREEMENT AND THE
OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN 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 AMONG THE PARTIES.

[Signature Pages Follow]

21

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their
respective authorized officers as of the day and year first above written.

	 	 	 	 	 	 	 
	 	 	DOMESTIC BORROWER:	 	 
	 
	 	 	 	 	 	 
	 	 	ION GEOPHYSICAL CORPORATION,	 	 
	 	 	a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ R. Brian Hanson
 

R. Brian Hanson
	 	 
	 

	 	Title:
	 	Executive Vice President and Chief
Financial Officer	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	FOREIGN BORROWER:	 	 
	 
	 	 	 	 	 	 
	 	 	ION INTERNATIONAL S.À R.L.,	 	 
	 	 	a Luxembourg private limited liability company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ R. Brian Hanson
 

R. Brian Hanson
	 	 
	 

	 	Title:
	 	Attorney-in-Fact	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 
	 	 	GUARANTOR OF DOMESTIC AND 
 FOREIGN LOANS:
	 
	 	 	 	 
	 	 	GX TECHNOLOGY CORPORATION,
	 	 	a Texas corporation
	 
	 	 	 	 
	 

	 	By:
	 	/s/ R. Brian Hanson
	 

	 	 	 	 
	 

	 	Name:
	 	R. Brian Hanson
	 

	 	Title:
	 	Vice President

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	GUARANTOR OF DOMESTIC AND 
 FOREIGN LOANS:	 	 
	 
	 	 	 	 	 	 
	 	 	ION EXPLORATION PRODUCTS (U.S.A.), Inc.,	 	 
	 	 	a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ R. Brian Hanson
 

R. Brian Hanson
	 	 
	 

	 	Title:
	 	Vice President	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	GUARANTOR OF DOMESTIC AND 
 FOREIGN LOANS:	 	 
	 
	 	 	 	 	 	 
	 	 	I/O MARINE SYSTEMS, INC., a Louisiana corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ R. Brian Hanson
 

R. Brian Hanson
	 	 
	 

	 	Title:
	 	Vice President	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	GUARANTOR OF FOREIGN LOANS:	 	 
	 
	 	 	 	 	 	 
	 	 	CONCEPT SYSTEMS LIMITED, a private limited	 	 
	 	 	company incorporated under the law of Scotland	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ David L. Roland
 

David L. Roland
	 	 
	 

	 	Title:
	 	Director	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	GUARANTOR OF FOREIGN LOANS:	 	 
	 
	 	 	 	 	 	 
	 	 	I/O CAYMAN ISLANDS, LTD, an Exempted	 	 
	 	 	Company incorporated in the Cayman Islands	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ R. Brian Hanson
 

R. Brian Hanson
	 	 
	 

	 	Title:
	 	Director	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 	 	 
	 	 	GUARANTOR OF FOREIGN LOANS:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ION INTERNATIONAL HOLDINGS L.P.,	 	 
	 	 	a Bermuda limited partnership	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ION Exploration Products (USA) Inc.,	 	 
	 	 	 	 	a Delaware corporation,	 	 
	 	 	 	 	its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ R. Brian Hanson
 

R. Brian Hanson
	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	GUARANTOR OF FOREIGN LOANS:	 	 
	 
	 	 	 	 	 	 
	 	 	SENSOR NEDERLAND B.V., a private company	 	 
	 	 	incorporated under the laws of The Netherlands	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ R. Brian Hanson
 

R. Brian Hanson
	 	 
	 

	 	Title:
	 	Director	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	ADMINISTRATIVE AGENT AND LENDER:	 	 
	 
	 	 	 	 	 	 
	 	 	HSBC BANK USA, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Steven F. Larsen
 

Steven F. Larsen
	 	 
	 

	 	Title:
	 	First Vice President	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	LENDER:	 	 
	 
	 	 	 	 	 	 
	 	 	HSBC BANK CANADA	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Kevin Bale
 

Kevin Bale
	 	 
	 

	 	Title:
	 	Assistant Vice President, Energy Financing	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Perry Englot	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Perry Englot	 	 
	 

	 	Title:
	 	Vice President, Energy Financing	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	LENDER:	 	 
	 
	 	 	 	 	 	 
	 	 	ABN AMRO BANK N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ James L. Moyes
 

James L. Moyes
	 	 
	 

	 	Title:
	 	Managing Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Todd Vaubel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Todd Vaubel	 	 
	 

	 	Title:
	 	Director	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	LENDER:	 	 
	 
	 	 	 	 	 	 
	 	 	CITIBANK, N.A.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Faith E. Allen
 

Faith E. Allen
	 	 
	 

	 	Title:
	 	Senior Vice President / Area Manager	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	LENDER:	 	 
	 
	 	 	 	 	 	 
	 	 	WHITNEY NATIONAL BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Kevin Rafferty
 

Kevin Rafferty
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	LENDER:	 	 
	 
	 	 	 	 	 	 
	 	 	PNC BANK, NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ W. J. Bowne
 

W. J. Bowne
	 	 
	 

	 	Title:
	 	Managing Director	 	 

[Signature page to First Amendment to Credit Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	LENDER:	 	 
	 
	 	 	 	 	 	 
	 	 	ABU DHABI INTERNATIONAL BANK INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ David Young
 

David Young
	 	 
	 

	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Nagy S. Kolta
 

Nagy S. Kolta
	 	 
	 

	 	Title:
	 	Executive Vice President	 	 

[Signature page to First Amendment to Credit Agreement]

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