Document:

saex-ex1016_232.htm

 

Exhibit 10.16

 

	

	
U.S. Small Business Administration

Unsecured NOTE “Note”

 

	
SBA Loan #
	
94124672-07

	
SBA Loan Name
	
N/A

	
Date
	
May 8, 2020

	
Loan Amount
	
$6,801,372.00

	
Interest Rate
	
1.00%

	
Borrower
	
SAExploration, Inc.

	
Operating Company
	
 

N/A

	
Lender
	
TEXAS CHAMPION BANK

6124 S. Staples, Corpus Christi, Texas 78413

 

	
 
	
1.
	
PROMISE TO PAY:

In return for the Loan, Borrower promises to pay to the order of Lender the amount of Six Million Eight Hundred One Thousand Three Hundred Seventy-Two Dollars, interest on the unpaid principal balance, and all other amounts required by this Note.

	
 
	
2.
	
DEFINITIONS:

“Collateral” means any property taken as security for payment of this Note on any guarantee of the Note. 

“Guarantor” means each person or entity that signs a guarantee of payment of this Note.

“Loan” means the loan evidenced by this Note.

“Loan Documents” means the documents related to this loan signed by Borrower and/or Guarantor.

“SBA” means the Small Business Administration, an Agency of the United States of America.

“Unsecured” means this note is unsecured.  All References to Collateral shall not be applicable to this loan.

 

	
SBA Form 147 (06/03/02) Version 4.1

 

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3.
	
PAYMENT TERMS:

Borrower must make all payments at the place Lender designates. The payment terms for this Note are: 

`

Borrower must make all payments at the place Lender designates. The payment terms for this note are: 

The interest rate is 1% per year.

Borrower must pay principal and interest payments of $382,764.21 every month beginning seven (7) months from the date of the note. Payments must be made on the 8th calendar day in the month they are due.

Loan Prepayment:

Notwithstanding any provision of this Note to the Contrary, Borrower may prepay this Note at any time without penalty. 

All remaining principal and accrued interest is due and payable 2 years from the date of the Note.

Late Charge: If a payment of this Note is more than 10 days late, Lender may charge Borrower a late fee of up to 5% of the unpaid portion of the regularly scheduled payment. 

	
 
	
4.
	
DEFAULT:

Borrower is in default under this Note if Borrower does not make a payment when due under this Note, or if Borrower or Operating Company:

	
 
	
A.
	
Fails to do anything required by this Note and other Loan Documents;

	
 
	
B.
	
Defaults on any other loan with Lender;

	
 
	
C.
	
Does not preserve, or account to Lender’s satisfaction for, any of the Collateral or its proceeds;

	
 
	
D.
	
Does not disclose, or anyone acting on their behalf does not disclose, any material fact to Lender or SBA;

	
 
	
E.
	
Makes, or anyone acting on their behalf makes, a materially false or misleading representation to Lender or SBA;

	
 
	
F.
	
Defaults on any loan or agreement with another creditor, if Lender believes the default may materially affect Borrower ’s ability to pay this Note;
	
 

	
 
	
G.
	
Fails to pay any taxes when due;

	
 
	
H.
	
Becomes the subject of a proceeding under any bankruptcy or insolvency law;

	
 
	
I.
	
Has a receiver or liquidator appointed for any part of their business or property;

	
 
	
J.
	
Makes an assignment for the benefit of creditors;

	
 
	
K.
	
Has any adverse change in financial condition or business operation that Lender believes may materially affect Borrower ’s ability to pay this Note;
	
 

	
 
	
L.
	
Reorganizes, merges, consolidates, or otherwise changes ownership or business structure without Lender ’s prior written consent; or
	
 

	
 
	
M.
	
Becomes the subject of a civil or criminal action that Lender believes may materially affect Borrower ’s ability to pay this Note.
	
 

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5.
	
LENDER ’S RIGHTS IF THERE IS A DEFAULT:

Without notice or demand and without giving up any of its rights, Lender may:

	
 
	
A.
	
Require immediate payment of all amounts owing under this Note;

	
 
	
B.
	
Collect all amounts owing from any Borrower or Guarantor;

	
 
	
C.
	
File suit and obtain judgment;

	
 
	
D.
	
Take possession of any Collateral; or

	
 
	
E.
	
Sell, lease, or otherwise dispose of, any Collateral at public or private sale, with or without advertisement.

	
 
	
6.
	
LENDER ’S GENERAL POWERS:

Without notice and without Borrower ’s consent, Lender may:

	
 
	
A.
	
Bid on or buy the Collateral at its sale or the sale of another lienholder, at any price it chooses;

	
 
	
B.
	
Incur expenses to collect amounts due under this Note, enforce the terms of this Note or any other Loan Document, and preserve or dispose of the Collateral. Among other things, the expenses may include payments for property taxes, prior liens, insurance, appraisals, environmental remediation costs, and reasonable attorney ’s fees and costs. If Lender incurs such expenses, it may demand immediate repayment from Borrower or add the expenses to the principal balance;
	
 

	
 
	
C.
	
Release anyone obligated to pay this Note;

	
 
	
D.
	
Compromise, release, renew, extend or substitute any of the Collateral; and

	
 
	
E.
	
Take any action necessary to protect the Collateral or collect amounts owing on this Note.

	
 
	
7.
	
WHEN FEDERAL LAW APPLIES:

When SBA is the holder, this Note will be interpreted and enforced under federal law, including SBA regulations. Lender or SBA may use state or local procedures for filing papers, recording documents, giving notice, foreclosing liens, and other purposes. By using such procedures, SBA does not waive any federal immunity from state or local control, penalty, tax, or liability. As to this Note, Borrower may not claim or assert against SBA any local or state law to deny any obligation, defeat any claim of SBA, or preempt federal law.

	
 
	
8.
	
SUCCESSORS AND ASSIGNS:

Under this Note, Borrower and Operating Company include the successors of each, and Lender includes its successors and assigns.

	
 
	
9.
	
GENERAL PROVISIONS:

	
 
	
A.
	
All individuals and entities signing this Note are jointly and severally liable.

	
 
	
B.
	
Borrower waives all suretyship defenses.

	
 
	
C.
	
Borrower must sign all documents necessary at any time to comply with the Loan Documents.
	
 

	
 
	
D.
	
Lender may exercise any of its rights separately or together, as many times and in any order it chooses. Lender may delay or forgo enforcing any of its rights without giving up any of them.
	
 

	
 
	
E.
	
Borrower may not use an oral statement of Lender or SBA to contradict or alter the written terms of this Note.

	
 
	
F.
	
If any part of this Note is unenforceable, all other parts remain in effect.

	
 
	
G.
	
To the extent allowed by law, Borrower waives all demands and notices in connection with this Note, including presentment, demand, protest, and notice of dishonor. Borrower also waives any defenses based upon any claim that Lender did not obtain any guarantee; did not obtain, perfect, or maintain a lien upon Collateral; impaired Collateral; or did not obtain the fair market value of Collateral at a sale.
	
 

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10.
	
ADDITIONAL PROVISIONS:

This loan was made under a United States Small Business Administration (SBA) nationwide program which uses tax dollars to assist small business owners.

Payment Protection Program: Loan Forgiveness.  This loan has been made under the Small Business Administration Paycheck Protection Program (PPP).  Up to the full amount of principal and accrued interest may qualify for forgiveness under the PPP.  Any loan forgiveness is subject to the terms and any limitations under the PPP and will be granted at the sole discretion of the Small Business Administration.  Lender’s right to enforce any default remedies including changes in interest rate are subject to the terms of the PPP.   

Dishonored Item Fee:  Borrower will pay a fee to Lender of $30.00 if Borrower makes a payment on Borrower’s loan and the check or preauthorized charge with which Borrower pays is later dishonored.

Governing Law:  This note will be governed by federal law applicable to Lender and, to the extent not preempted by federal laws, the laws of the State of Texas without regard to its conflicts of law provisions.  This Note has been accepted by Lender in the State of Texas.

Agreement to Use Electronic Documents.  The Lender and Borrower(s) hereby (i)agree that for all purposes, including, without limitation, in connection with any workout, restructuring, enforcement of remedies, bankruptcy proceeds or litigation, electronic images (facsimile or PDF) of these documents signed by any party to this loan transaction shall have the same legal effect, validity, and enforceability as any paper original and  (ii) waiver any argument, defense, or right to contest the validity or enforceability of these documents based solely on the lack of paper original copies, including with respect to any signatory pages thereto.

Borrower acknowledges receipt of a completed copy of this Note.

	
 
	
11.
	
BORROWER ’S NAME(S) AND SIGNATURE(S):

By signing below, each individual or entity becomes obligated under this Note as Borrower.

 

	
 
	
SAExploration, Inc.

	
 
	
/s/Kevin Hubbard
	
 

	
 
	
Kevin Hubbard, Interim Chief Financial Officer
	
May 8, 2020
	
 

 

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Exhibit 10.17

May 7, 2020

SAExploration Holdings, Inc.

1160 Dairy Ashford, Suite 160

Houston, Texas 77079

Attn:  Michael Faust, 

Chief Executive Officer and President

Dear Mr. Faust:

 

Reference is hereby made to:

	
 
	
(i)
	
that certain Third Amended and Restated Credit and Security Agreement dated as of September 26, 2018, entered into among SAExploration, Inc., a Delaware corporation (the “Borrower”), SAExploration Holdings, Inc. (the “Parent”), the other Guarantors party thereto, the Lenders party thereto and Cantor Fitzgerald Securities, as administrative agent and collateral agent for the Lenders (as amended, supplemented or otherwise modified, the “Credit Agreement”), and 

	
 
	
(ii)
	
that certain Forbearance Agreement dated April 13, 2020, among the Borrower, the Parent, the other Guarantors, and the Lenders party thereto (the “Forbearance Agreement”).

 

This consent letter (this “Consent”) relates to the Credit Agreement.  Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement. All references to sections in this Consent shall be to sections of the Credit Agreement unless otherwise indicated.

 

The Borrower has informed the Administrative Agent that the Borrower has applied for an unsecured loan under the Small Business Administration Paycheck Protection Program (as part of the CARES Act (hereinafter defined)) in a principal amount not to exceed $10.0 million (the “PPP Loan”).  The restrictions in Section 7.1 of the Credit Agreement and in the Forbearance Agreement do not currently allow the Borrower or the other Loan Parties to incur the PPP Loan.

The Borrower has requested that the Required Lenders consent to the PPP Loan, and the Lenders signatory hereto which constitute Required Lenders do hereby consent to the incurrence of unsecured Indebtedness under the PPP Loan, notwithstanding anything in Section 7.1 or in the Forbearance Agreement to the contrary; provided that, (i) at all times when the PPP Loan is outstanding, each Loan Party will maintain its eligibility for such PPP Loan and take all actions necessary to stay in compliance with the requirements applicable to such PPP Loan under The Coronavirus Aid, Relief, and Economic Security Act, Public Law No: 116-136 (as amended, modified, or supplemented, the “CARES Act”), (ii) each Loan Party shall take all action necessary to cause the maximum portion of the PPP Loan which is eligible to be forgiven in accordance with the CARES Act, (iii) the maturity date for the PPP Loan shall not occur prior to the Maturity Date under the Credit Agreement and (iv) the loan documents evidencing the PPP Loan (“PPP Loan Documents”) shall not be amended in a manner adverse to the interests of the Lenders including without limitation by securing the PPP Loan with collateral.  The parties hereto agree that any default under or breach of the PPP Loan Documents shall constitute an Event of Default under the Credit Agreement.  For the avoidance of doubt, upon its incurrence the PPP Loan will constitute Indebtedness for all purposes under the Credit Agreement and the other Loan Documents until such time as the obligation to repay the  PPP Loan is forgiven and/or paid (as applicable) in accordance with its terms

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May 7, 2020

Page 2

Each of the Borrower, the Parent and the Guarantors hereby expressly (a) acknowledges the terms of this Consent, and (b) ratifies and affirms its obligations under, and acknowledges, renews and extends its continued liability under, each Loan Document to which it is a party and agrees that each Loan Document to which it is a party remains in full force and effect, except as expressly set forth herein.

The foregoing consent is hereby granted to the extent and only to the extent specifically stated herein and for no other purpose and shall not be deemed to (a) be a consent or agreement to, or waiver or modification of, any other term or condition of the Credit Agreement, the Forbearance Agreement or any other Loan Document or any of the documents referred to therein, (b) except as expressly set forth herein, impair or prejudice any right or rights which the Administrative Agent or the Lenders may now have or may have in the future under or in connection with the Credit Agreement, the Forbearance Agreement or any other Loan Document or any of the documents referred to therein, or (c) constitute any course of dealing or other basis for altering any obligation of the Borrower, the Parent or the other Guarantors or any right, privilege or remedy of the Administrative Agent or the Lenders under the Credit Agreement, the Forbearance Agreement, the other Loan Documents, or any other contract or instrument.  Granting the consent set forth herein does not and should not be construed to be an assurance or promise that any consent or waiver will be granted in the future.  

This Consent (including, but not limited to, the validity and enforceability hereof) shall be governed by, and construed in accordance with, the laws of the State of New York.

This Consent is a “Loan Document” as defined and described in the Credit Agreement and all of the terms and provisions of the Credit Agreement relating to Loan Documents shall apply hereto.

This Consent may be executed by one or more of the parties hereto in any number of separate counterparts, and all of such counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of this Consent by facsimile or email transmission shall be effective as delivery of a manually executed counterpart hereof.

This Consent, the Credit Agreement, the Forbearance Agreement and the other Loan Documents  represent the final agreement between the parties  with respect to the subject matter hereof and thereof and may not be contradicted by evidence of prior, contemporaneous, or unwritten oral agreements of the parties.  There are no subsequent oral agreements among the parties with respect to the subject matter hereof.

If the foregoing correctly states your understanding with respect to the matters stated in this Consent, please acknowledge by signing in the space provided below. The undersigned Lenders party hereto have caused this Consent to be executed and delivered as of the date first above written.

[Signature Pages Follow]

 

 

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LENDERS:

WHITEBOX ASYMMETRIC PARTNERS, L.P.

By: /s/ Mark Strefling

Name: Mark Strefling

Title: Partner & CEO

WHITEBOX MULTI-STRATEGY PARTNERS, L.P.

	
 
	
By:
	
Whitebox Advisors LLC, its investment manager

By: /s/ Mark Strefling

Name: Mark Strefling

Title: Partner & CEO

WHITEBOX CREDIT PARTNERS, L.P.

	
 
	
By:
	
Whitebox Advisors LLC, its investment manager

By: /s/ Mark Strefling

Name: Mark Strefling

Title: Partner & CEO

 

 

3

 

LENDERS

HIGHBRIDGE MSF INTERNATIONAL LTD.

(f/k/a 1992 MSF International Ltd.)

	
 
	
By: 
	
Highbridge Capital Management, LLC, as Trading Manager and not in its individual capacity

By: /s/ Jonathan Segal

Name: Jonathan Segal

Title: Managing Director

HIGHBRIDGE TACTICAL CREDIT
MASTER FUND, L.P.

(f/k/a 1992 Tactical Credit Master Fund, L.P.)

	
 
	
By:
	
Highbridge Capital Management, LLC, as Trading Manager and not in its individual capacity

By: /s/ Jonathan Segal

Name: Jonathan Segal

Title: Managing Director

4

 

LENDER:

JOHN PECORA

By: /s/ John Pecora

 

5

 

Accepted and Agreed to as of the date first written above by:

BORROWER:

SAEXPLORATION, INC.

By: /s/ Michael J. Faust

Name:  Michael J. Faust

Title:  Chief Executive Officer and President

GUARANTORS:

SAEXPLORATION HOLDINGS, INC.

SAEXPLORATION SUB, INC.

NES, LLC

SAEXPLORATION SEISMIC SERVICES (US), LLC

By: /s/ Michael J. Faust

Name:  Michael J. Faust

Title:  Chief Executive Officer and President of
each of the foregoing companies

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