Document:

Exhibit 10.1

 

THIS CONVERTIBLE PROMISSORY NOTE (THIS “NOTE”)
AND THE SECURITIES INTO WHICH IT MAY BE CONVERTED HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE.
THIS NOTE HAS BEEN ACQUIRED FOR INVESTMENT ONLY AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED EXCEPT AS PERMITTED UNDER THE SECURITIES
ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE MAKER MAY REQUIRE AN OPINION OF COUNSEL
REASONABLY SATISFACTORY IN FORM, SCOPE AND SUBSTANCE TO THE MAKER TO THE EFFECT THAT ANY SALE OR OTHER DISPOSITION IS IN COMPLIANCE WITH
THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

 

ACE CONVERGENCE ACQUISITION CORP.

CONVERTIBLE PROMISSORY NOTE

 

	Principal Amount: Up to $1,500,000	 	Dated
                                            as of January 13, 2022

 

ACE Convergence Acquisition Corp., a Cayman Islands
exempted company limited by shares (“Maker”), promises to pay to ACE Convergence Acquisition LLC, a Delaware limited
liability company (“Payee”), or order, the principal balance as set forth on Schedule A hereto in cash
in lawful money of the United States of America, on the terms and conditions described below; which schedule shall be updated from time
to time by the parties hereto to reflect all advances and re-advances outstanding under this Note; provided that at no time shall
the aggregate of all advances and re-advances outstanding under this note exceed one million and five hundred thousand dollars ($1,500,000)
(the “Maximum Amount”). Any advance hereunder shall be made by the Payee pursuant to Section 2 below and shall
be set forth on Schedule A. All payments on this Note shall be made by check or wire transfer of immediately available funds
or as otherwise determined by Maker to such account as Payee may from time to time designate by written notice in accordance with the
provisions of this Note.

 

1.                  
Principal. All unpaid principal under this Note shall be due and payable in full on the earlier of: (i) the date by which
Maker has to complete a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination
with one or more businesses pursuant to Section 17 of its Amended and Restated Memorandum and Articles of Association (as it may
be amended from time to time), and (ii) immediately prior to the Effective Time (as defined in the Agreement and Plan of Merger (the “Merger
Agreement”), dated as of October 13, 2021, by and among Maker, ACE Convergence Subsidiary Corp. and Tempo Automation, Inc.)
(such earlier date of (i) and (ii), the “Maturity Date”), unless accelerated upon the occurrence of an Event of Default
(as defined below). Any outstanding principal under this Note may be prepaid at any time by Maker, at its election and without penalty;
provided, however, that Payee shall have a right to first convert such principal balance pursuant to Section 6 below
upon notice of such prepayment. Under no circumstances shall any individual, including, but not limited to, any officer, director, employee
or shareholder of Maker, be obligated personally for any obligations or liabilities of Maker hereunder.

 

2.                  
Drawdowns. Payee shall advance to Maker, beginning on January 25, 2022, and thereafter on the 25th of each month
until the earlier of (i) the consummation of the transactions contemplated by the Merger Agreement and (ii) the date by which Maker must
complete an initial business combination, an amount equal to the product of $0.03 and the number of then-outstanding Class A ordinary
shares of Maker, such amounts in the aggregate not to exceed the Maximum Amount. Drawdowns under this Note are conditioned upon the approval
by the shareholders of Maker of the proposal to extend the date by which Maker must complete an initial business combination to be presented
at the annual general meeting of shareholders of Maker to be held on January 21, 2022.

 

     

     

    

 

3.                  
 Interest. No interest shall accrue on the unpaid principal balance of this Note.

 

4.                  
Application of Payments. All payments shall be applied first to payment in full of any costs incurred in the collection of
any sum due under this Note, including (without limitation) reasonable attorney’s fees, then to the payment in full of any late
charges and finally to the reduction of the unpaid principal balance of this Note.

 

5.                  
Events of Default. The occurrence of any of the following shall constitute an event of default (“Event of Default”):

 

(a)               
Failure to Make Required Payments. Failure by Maker to pay the principal amount due pursuant to this Note on the Maturity
Date.

 

(b)               
Voluntary Bankruptcy, Etc. The commencement by Maker of a voluntary case under any applicable bankruptcy, insolvency, reorganization,
rehabilitation or other similar law, or the consent by it to the appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator (or other similar official) of Maker or for any substantial part of its property, or the making by it
of any assignment for the benefit of creditors, or the failure of Maker generally to pay its debts as such debts become due, or the taking
of corporate action by Maker in furtherance of any of the foregoing.

 

(c)               
Involuntary Bankruptcy, Etc. The entry of a decree or order for relief by a court having jurisdiction in the premises in
respect of Maker in an involuntary case under any applicable bankruptcy, insolvency or other similar law, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of Maker or for any substantial part of its property, or ordering the
winding-up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of sixty
(60) consecutive days.

 

6.                  
Conversion

 

(a)                Optional
Conversion. At the option of Payee, at any time on or prior to the Maturity Date, any unpaid principal amount outstanding under
this Note (or any portion thereof) up to $1,500,000 in the aggregate may be converted into whole warrants of Maker to purchase Class
A ordinary shares of Maker (“Warrants”) at a conversion price (the “Conversion Price”) equal
to $1.00 per Warrant. If Payee elects such conversion, the terms of such Warrants issued in connection with such conversion shall be
identical to the warrants issued to Payee pursuant to the Sponsor Warrants Purchase Agreement, dated as of July 27, 2020, by and
between Payee and Maker, in connection with Maker’s initial public offering that was consummated on July 30, 2020 (the
“Private Placement Warrants”), including that each Warrant will entitle the holder thereof to purchase one Class
A ordinary share of Maker at a price of $11.50 per share, subject to the same adjustments applicable to the Private Placement
Warrants. Before this Note may be converted under this Section 6(a), Payee shall surrender this Note, duly endorsed, to
Maker and shall state therein the amount of the unpaid principal of this Note to be converted and the name or names in which the
certificates for Warrants are to be issued (or the book-entries to be made to reflect ownership of such Warrants with Maker’s
transfer agent); provided that such principal amount is no greater than $1,500,000. To the extent that this Note is not
converted and/or repaid in full, a replacement Note shall be issued to Payee reflecting the remaining unpaid principal amount not so
converted and/or repaid. The conversion shall be deemed to have been made immediately prior to the close of business on the date of
the surrender of this Note and the person or persons entitled to receive the Warrants upon such conversion shall be treated for all
purposes as the record holder or holders of such Warrants as of such date. Each such newly issued Warrant shall include a
restrictive legend that contemplates the same restrictions as the Private Placement Warrants. The Warrants and Class A ordinary
shares of Maker issuable upon exercise of the Warrants shall each constitute a “Registrable Security” pursuant to that
certain Registration Rights Agreement, dated as of July 27, 2020, by and among Maker, Payee and the other parties thereto.

 

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(b)               
Remaining Principal. All accrued and unpaid principal of this Note that is not converted into Warrants shall continue to
remain outstanding and to be subject to the conditions of this Note or such replacement Note referred to in Section 6(a).

 

(c)               
Fractional Warrants. No fractional Warrants shall be issued upon conversion of this Note. In lieu of any fractional Warrants
that would otherwise be issuable to Payee upon conversion of this Note, Maker shall pay to Payee an amount equal to the product obtained
by multiplying the Conversion Price by the fraction of a Warrant not issued pursuant to the previous sentence.

 

(d)               
Effect of Conversion. Upon conversion of this Note and the payment of any amounts specified in Section 6(c)
and otherwise remaining outstanding, this Note shall be cancelled and void without further action of Maker or Payee, and Maker shall be
forever released from all its obligations and liabilities under this Note.

 

7.                  
Remedies.

 

(a)               
Upon the occurrence of an Event of Default specified in Section 5(a), Payee may, by written notice to Maker, declare
this Note to be due immediately and payable, whereupon the unpaid principal amount of this Note, and all other amounts payable thereunder,
shall become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly
waived, anything contained herein or in the documents evidencing the same to the contrary notwithstanding.

 

(b)               
Upon the occurrence of an Event of Default specified in Section 5(b) or Section 5(c), the unpaid principal
balance of this Note, and all other sums payable with regard to this Note, shall automatically and immediately become due and payable,
in all cases without any action on the part of Payee.

 

8.                  
Waivers. Maker and all endorsers and guarantors of, and sureties for, this Note waive presentment for payment, demand, notice
of dishonor, protest, and notice of protest with regard to the Note, all errors, defects and imperfections in any proceedings instituted
by Payee under the terms of this Note, and all benefits that might accrue to Maker by virtue of any present or future laws exempting any
property, real or personal, or any part of the proceeds arising from any sale of any such property, from attachment, levy or sale under
execution, or providing for any stay of execution, exemption from civil process, or extension of time for payment; and Maker agrees that
any real estate that may be levied upon pursuant to a judgment obtained by virtue hereof, on any writ of execution issued hereon, may
be sold upon any such writ in whole or in part in any order desired by Payee.

 

9.                  
Unconditional Liability. Maker hereby waives all notices in connection with the delivery, acceptance, performance, default,
or enforcement of the payment of this Note, and agrees that its liability shall be unconditional, without regard to the liability of any
other party, and shall not be affected in any manner by any indulgence, extension of time, renewal, waiver or modification granted or
consented to by Payee, and consents to any and all extensions of time, renewals, waivers, or modifications that may be granted by Payee
with respect to the payment or other provisions of this Note, and agrees that additional makers, endorsers, guarantors, or sureties may
become parties hereto without notice to Maker or affecting Maker’s liability hereunder.

 

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10.              
 Notices. All notices, statements or other documents which are required or contemplated by this Note shall be: (i) in writing
and delivered personally or sent by first class registered or certified mail or overnight courier service to the address most recently
provided to such party or such other address as may be designated in writing by such party, (ii) by facsimile to the number most
recently provided to such party or such other facsimile number as may be designated in writing by such party or (iii) by electronic
mail, to the electronic mail address most recently provided to such party or such other electronic mail address as may be designated in
writing by such party. Any notice or other communication so delivered or transmitted shall be deemed to have been given on the day of
delivery, if delivered personally, on the business day following receipt of written confirmation, if sent by facsimile or electronic transmission,
one (1) business day after delivery to an overnight courier service or five (5) days after mailing if sent by mail.

 

11.              
Construction. THIS NOTE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

12.              
Severability. Any provision contained in this Note which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof,
and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other
jurisdiction.

 

13.              
Trust Waiver. Notwithstanding anything herein to the contrary, Payee hereby waives any and all right, title, interest or claim
of any kind (“Claim”) in or to any distribution of or from the trust account established in which proceeds of Maker’s
initial public offering (including the deferred underwriters discounts and commissions) and proceeds of the sale of the Private Placement
Warrants were deposited, as described in greater detail in the registration statement on Form S-1 (File No. 333-239716) filed by Maker
with the U.S. Securities and Exchange Commission, that was declared effective on July 27, 2020, and the related prospectus, and hereby
agrees not to seek recourse, reimbursement, payment or satisfaction for any Claim against the trust account for any reason whatsoever.

 

14.              
Amendment; Waiver. Any amendment hereto or waiver of any provision hereof may be made with, and only with, the written consent
of Maker and Payee.

 

15.              
Assignment; Successors and Assigns. Subject to Section 16, no assignment or transfer of this Note or any rights
or obligations hereunder may be made by either party hereto (by operation of law or otherwise) without the prior written consent of the
other party hereto and any attempted assignment without the required consent shall be void. This Note shall be binding upon and benefit
the permitted successors and permitted assigns of a party hereto.

 

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16.               Transfer
of this Note or Securities Issuable on Conversion. With respect to any sale or other disposition of this Note or securities into
which this Note may be converted, Payee shall give written notice to Maker prior thereto, describing briefly the manner thereof,
together with (i) except for a Permitted Transfer, in which case the requirements in this clause (i) shall not apply, a written
opinion reasonably satisfactory to Maker in form and substance from counsel reasonably satisfactory to Maker to the effect that such
sale or other distribution may be effected without registration or qualification under any federal or state law then in effect and
(ii) a written undertaking executed by the desired transferee reasonably satisfactory to Maker in form and substance agreeing to be
bound by the restrictions on transfer contained herein. Upon receiving such written notice, reasonably satisfactory opinion, or
other evidence, and such written acknowledgement, Maker, as promptly as practicable, shall notify Payee that Payee may sell or
otherwise dispose of this Note or such securities, all in accordance with the terms of the note delivered to Maker. If a
determination has been made pursuant to this Section 16 that the opinion of counsel for Payee, or other evidence, or the
written acknowledgment from the desired transferee, is not reasonably satisfactory to Maker, Maker shall so notify Payee promptly
after such determination has been made. Each Note thus transferred shall bear a legend as to the applicable restrictions on
transferability in order to ensure compliance with the Securities Act, unless in the opinion of counsel for Maker such legend is not
required in order to ensure compliance with the Securities Act. Maker may issue stop transfer instructions to its transfer agent in
connection with such restrictions. Subject to the foregoing, transfers of this Note shall be registered upon registration on the
books maintained for such purpose by or on behalf of Maker. Prior to presentation of this Note for registration of transfer, Maker
shall treat the registered holder hereof as the owner and holder of this Note for the purpose of receiving all payments of principal
hereon and for all other purposes whatsoever, whether or not this Note shall be overdue and Maker shall not be affected by notice to
the contrary. For purposes hereof “Permitted Transfer” shall have the same meaning as any transfer that would be
permitted for the Private Placement Warrants under the Letter Agreement, dated as of July 27, 2020, by and between Maker, Payee and
the other parties thereto.

 

17.              
Acknowledgment. Payee is acquiring this Note for investment for its own account, not as a nominee or agent, and not with a
view to, or for resale in connection with, any distribution thereof. Payee understands that the acquisition of this Note involves substantial
risk. Payee has experience as an investor in securities of companies and acknowledges that it is able to fend for itself, can bear the
economic risk of its investment in this Note, and has such knowledge and experience in financial and business matters that it is capable
of evaluating the merits and risks of this investment in this Note and protecting its own interests in connection with this investment.

 

[Signature page follows.]

 

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IN WITNESS WHEREOF, Maker, intending to be
legally bound hereby, has caused this Note to be duly executed by the undersigned as of the day and year first above written.

 

	 	ACE
    CONVERGENCE ACQUISITION CORP.
	 	 
	 	By:	 /s/ Behrooz Abdi
	 	 	Name: Behrooz Abdi
	 	 	Title: Chief Executive Officer

 

Acknowledged and agreed as of the day and year
first above written.

 

	ACE
    CONVERGENCE ACQUISITION LLC	 
	 	 
	 	 
	By:	/s/
    Behrooz Abdi	 
	 	Name:
    Behrooz Abdi	 
	 	Title:
    Chief Executive Officer	 

 

     

     

    

 

SCHEDULE A

 

Subject to the terms and conditions set forth in
the Note to which this schedule is attached, the principal balance due under the Note shall be set forth in the table below and shall
be updated from time to time to reflect all advances and re-advances outstanding under the Note.

 

	Date	Drawing	Interest Earned	Principal Balanceex_323953.htm

Exhibit 10.1

 

 

 FORBEARANCE AND FIFTH AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT

 

 

This FORBEARANCE AND FIFTH AMENDMENT TO REVOLVING CREDIT AND SECURITY AGREEMENT (this “Agreement”), is made and entered into as of January 15, 2022, by and among ION GEOPHYSICAL CORPORATION, a Delaware corporation (“Geophysical”), ION EXPLORATION PRODUCTS (U.S.A.), INC., a Delaware corporation (“Exploration”), I/O MARINE SYSTEMS, INC., a Louisiana corporation (“Marine”), GX TECHNOLOGY CORPORATION, a Texas corporation (“GXT”), GX GEOSCIENCE CORPORATION, S. DE R.L. DE C.V., a Sociedad de Responsabilidad Limitada de Capital Variable organized under the laws of Mexico (“GX Geoscience” and, together with Geophysical, Exploration, Marine and GXT, collectively, the “Borrowers”, and each a “Borrower”), the financial institutions a party hereto as lenders (collectively, the “Lenders” and each individually a “Lender”) and PNC BANK, NATIONAL ASSOCIATION (“PNC”), as agent for Lenders (PNC, in such capacity, together with its successors and assignees in such capacity, the “Agent”).

 

BACKGROUND

 

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

 

B.    Borrowers have informed Agent and the Lenders that an Event of Default has occurred under Section 10.11 of the Credit Agreement because the Borrowers’ failed to pay the scheduled interest payment due on December 15, 2021 under the New Second Priority Notes prior to the expiration of the 30-day grace period under the New Second Priority Notes Indenture (the “Specified Default”).

 

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

 

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

 

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

 

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

 

	 	
			2.

				
			Acknowledgements by Borrowers.

			

 

(a)    Acknowledgment of Debt. As of the close of business on January 13, 2022, each Borrower is indebted, jointly and severally, to Lenders and Agent, without defense, deduction, setoff, claim or counterclaim, of any nature, under the Credit Agreement and the Other Documents in the aggregate principal amount of $19,350,000 in respect of the Advances, plus accrued and continually accruing interest, fees, costs and expenses;

 

(b)    Acknowledgment of Existing Defaults. As of the date hereof: (i) the Specified Default exists and is continuing under the Credit Agreement and Other Documents; (ii) the grace period applicable to the cure of such Specified Default has expired; (iii) the Specified Default is continuing without timely cure by the Borrowers; and (iv) neither the Agent nor any Lender has waived in any respect any or all of such Specified Default or their rights and remedies with respect thereto;

 

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

 

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

 

	 	
			3.

				
			Forbearance by Agent and Lenders.

			

 

(a)    Forbearance Period. At the request of Borrowers, the Agent and Lenders agree to forbear from accelerating the Obligations and from commencing and/or prosecuting the exercise of any rights and remedies, whether at law, in equity, by agreement or otherwise, available to the Agent and Lenders as a result of the Specified Default, from the date hereof until the earliest to occur of the following times: (i) February 15, 2022; (ii) the time at which (x) any representation or warranty made by a Borrower under this Agreement shall prove to have been materially incorrect (without duplication of any materiality qualifiers therein) when made or deemed made or (y) any Borrower fails to comply in any respect with its covenants set forth in this Agreement; or (iii) the occurrence of any other Event of Default under the Credit Agreement or any Other Document (other than the continuation of the Specified Default) (the period beginning on the date hereof and terminating on the earliest of such dates being hereinafter referred to as the “Forbearance Period”). As partial consideration for the Agent and Lenders agreeing to the forbearance in this Section 3(a), and as a condition precedent to the effectiveness of the forbearance referenced above, Borrowers shall repay the outstanding principal amount of the Obligations, in immediately available funds, in the amount of $2,500,000 (“Forbearance Paydown”).

 

(b)    No Advances. As of the date of this Agreement, Lenders shall have no obligation to make Advances.

 

(c)    Termination of Forbearance Period. Upon the termination of the Forbearance Period, all forbearances, deferrals and indulgences granted by the Agent and Lenders in Section 3(a) above shall automatically terminate, and the Agent and Lenders shall thereupon have, and shall be entitled to exercise, any and all rights and remedies that the Agent and/or Lenders may have upon the occurrence of an Event of Default, including, without limitation, the Specified Default.

 

(d)    Preservation of Rights. By agreeing to temporarily forbear from the exercise of rights and remedies under the terms of this Agreement, Agent and Lenders do not waive the Specified Default or any other Event of Default that may be outstanding on the date hereof or any Event of Default that may occur after the date hereof (whether the same as, or similar to, the Specified Default or otherwise). The Specified Default and any other Events of Default which may be continuing on the date hereof or any Events of Default which may occur after the date hereof (whether the same as, or similar to, the Specified Default or otherwise) are hereby preserved. The granting of the forbearance hereunder shall not be deemed a waiver of any options, rights and remedies of Agent and/or Lenders and shall not constitute a course of conduct or dealing on behalf of Agent or Lenders. Subject to the terms of this Agreement, Agent and Lenders specifically reserve all options, rights and remedies available to it and them under the Credit Agreement, the Other Documents, Applicable Law or otherwise.

 

4.    Amendments to Credit Agreement.

 

(a)    The following defined term in the Credit Agreement is hereby amended and restated in its entirety as follows:

 

“Cash Dominion Trigger Event” shall mean (a) the occurrence and continuance of an Event of Default or (b) Liquidity is less than $5,000,000 for five (5) consecutive Business Days; provided that a Cash Dominion Trigger Event shall cease to exist, with respect to clause (a) above, upon the waiver in writing of the applicable Event of Default, and with respect to clause (b) above, when Borrowers have Excess Availability, for sixty (60) consecutive days, exceeding $15,000,000.

 

“Covenant Testing Trigger Event” shall mean (a) the occurrence and continuance of an Event of Default or (b) Liquidity is less than $5,000,000 for five (5) consecutive Business Days; provided that a Covenant Testing Trigger Event shall cease to exist, with respect to clause (a) above, upon the waiver of the applicable Event of Default, and with respect to clause (b) above, when Borrowers have Excess Availability, for sixty (60) consecutive days, exceeding $15,000,000.

 

“Liquidity” shall mean, as of any date, the sum of (a) Excess Availability as of such date, plus (b) the aggregate amount of unrestricted cash held by the Loan Parties and their domestic Subsidiaries in Depository Accounts established at Agent or a Control Account Bank.

 

“Maximum Revolving Advance Amount” shall mean $16,850,000.

 

(b)    Clause (vii) of Section 2.1(a) of the Credit Agreement shall be amended and restated in its entirety as follows:

 

(vii)         [reserved];

 

(c)    The Revolving Commitment Amount of $50,000,000 set forth below PNC’s signature on the signature page attached to the Credit Agreement is hereby deleted and replaced with $16,850,000.

 

5.    Removal of LIBOR Option; Conversion to Domestic Rate Loan. Notwithstanding anything to the contrary in Section 2.2(b) of the Credit Agreement, from and after the date of this Agreement no Borrower may request and Agent shall not permit any Revolving Advances to be designated as LIBOR Rate Loans. On the last Business Day of the current Interest Period for all outstanding LIBOR Rate Loans, all outstanding LIBOR Rate Loans shall be converted to Domestic Rate Loans. Agent agrees that Borrowers shall not be liable for any breakage fees or other costs related to the conversion of the outstanding LIBOR Rate Loans to Domestic Rate Loans in accordance with this Section 5.

 

6.    Accommodation Fee. Without limitation of the foregoing and in consideration of the agreements set forth herein, the Borrowers hereby agree to pay to Agent in immediately available funds an accommodation fee in the aggregate amount of $168,500 (the “Accommodation Fee”), which Accommodation Fee is (i) immediately due and payable, (ii) non-refundable when paid, and (iii) fully-earned as of the date of this Agreement.

 

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

 

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

 

(b)    Receipt of the Forbearance Paydown;

 

(c)    Receipt of the Accommodation Fee;

 

(d)    Executed counterparts of any other documents the Agent shall reasonable request; and

 

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

 

(f)    An executed forbearance agreement from holders of more than 75% of the New Second Priority Notes (the “Directing Noteholders”) under the New Second Priority Indenture, which shall be in form and substance reasonably acceptable to Agent, and which shall include (i) consent from the Directing Noteholders to the granting of the Liens set forth in Sections 8(a)-(c) of this Agreement, and (ii) in accordance with Section 2.3 of the New Second Priority Intercreditor Agreement, an agreement by Borrowers cause their applicable Subsidiaries to grant to the New Second Priority Indenture Trustee the same Liens set forth in Sections 8(a)-(c) of this Agreement.

 

8.    Post-Closing Conditions.

 

(a)    Borrowers shall use commercially reasonable best efforts to promptly cause GX Technology Sismica do Brasil Ltda., a Sociedade limitada organized under the laws of Brazil (“GX Sismica”) and, to (i) become a Guarantor, (ii) execute a Guaranty and a Guaranty Security Agreement granting to Agent for its benefit and the ratable benefit of each Lender a security interest in and to and Lien on all of GX Sismica’s assets, including, without limitation, all accounts receivable, all interests in the Multi-Client Data Library, all interests in GX Technology Processamento De Dados, Ltda., a Sociedade limitada organized under the laws of Brazil (“GX Processamento”), and all cash and non-cash proceeds thereof, including insurance proceeds.

 

(b)    Borrowers shall use commercially reasonable best efforts to promptly cause ION International S.a.r.l., a Société à responsabilité limitée organized under the laws of Luxembourg (“ION Luxembourg”) to (i) execute a security agreement in form and substance acceptable to Agent granting to Agent a Lien on all of ION Luxembourg’s assets, including, without limitation, all accounts receivable, instruments, or other right to payment owed to ION Luxembourg from GX Sismica and GX Processamento, respectively, and all cash and non-cash proceeds thereof, including insurance proceeds, or (ii) if requested by Agent, execute a Guaranty and a Guaranty Security Agreement granting to Agent for its benefit and the ratable benefit of each Lender a security interest in and to and Lien on all of ION Luxembourg’s assets, including without limitation, all accounts receivable, instruments, or other right to payment owed to ION Luxembourg from GX Sismica and GX Processamento (if any), respectively, and all cash and non-cash proceeds thereof, including insurance proceeds.

 

(c)    Borrowers shall use commercially reasonable best efforts to promptly cause ION International Holdings, L.P., a limited partnership organized under the laws of Bermuda (“ION Bermuda”) to (i) execute a security agreement in form and substance acceptable to Agent granting to Agent a Lien on all of ION Bermuda’s assets, including, without limitation, all accounts receivable, instruments, or other right to payment owed to ION Bermuda from ION Luxembourg and all cash and non-cash proceeds thereof, including insurance proceeds, and, notwithstanding anything to the contrary in the Credit Agreement, all of the Equity Interests of ION Luxembourg and GX Sismica issued to ION Bermuda, or (ii) if requested by Agent, execute a Guaranty and a Guaranty Security Agreement granting to Agent for its benefit and the ratable benefit of each Lender a security interest in and to and Lien on all of ION Bermuda’s assets, including, without limitation, all accounts receivable, instruments, or other right to payment owed to ION Bermuda from ION Luxembourg and all cash and non-cash proceeds thereof, including insurance proceeds, and, notwithstanding anything to the contrary in the Credit Agreement, all of the Equity Interests of ION Luxembourg and GX Sismica issued to ION Bermuda.

 

(d)    During the Forbearance Period, Borrowers shall continue to provide Agent with weekly financial reporting consistent with existing practice and as otherwise reasonably requested by Agent.

 

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

 

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

 

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

 

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

 

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

 

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

 

10.    Effect of Agreement. The forbearance set forth above shall be effective solely with respect to the Specified Default, and the agreements set forth above shall be effective solely with respect to the matters expressly set forth above, and shall not, by implication or otherwise, limit, impair, waive or otherwise affect the obligations of the Borrowers under the Credit Agreement or any Other Document.

 

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

 

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

 

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

 

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

 

12.    Miscellaneous.

 

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

 

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

 

(c)    Release. Each Borrower hereby acknowledges that it has no defense, counterclaim, offset, cross‐complaint, claim or demand of any kind or nature whatsoever that can be asserted to reduce or eliminate all or any part of its liability to repay any loans or extensions of credit from Agent and Lenders to such Borrower under the Credit Agreement or the Other Documents or to seek affirmative relief or damages of any kind or nature from Lenders and the Agent. Each Borrower hereby voluntarily and knowingly releases and forever discharges Lenders, the Agent, their predecessors, agents, employees, officers, directors, partners, servents representatives, attorneys, consultants, advisors, affiliates, successors and assigns (collectively, the “Released Parties”), from all possible claims, suits, debts, liens, losses, demands, actions, causes of action, rights, damages, costs, expenses, and liabilities of any kind, known or unknown, anticipated or unanticipated, suspected or unsuspected, fixed, contingent, or conditional, at law or in equity, originating in whole or in part on or before the effectiveness of this Agreement, which such Borrower may now or hereafter have against the Released Parties, if any, and irrespective of whether any such claims arise out of contract, tort, violation of law or regulations, or otherwise, and arising out of, relating to, or in connection with the Borrowers, Affiliates of the Borrowers, the lending relationship among the Secured Parties and Loan Parties, any action or inaction by any Secured Party, the Obligations, the Credit Agreement or the Other Documents to which such Person is a party, including, without limitation, any contracting for, charging, taking, reserving, collecting or receiving interest in excess of the highest lawful rate applicable, the exercise of any rights and remedies under the Credit Agreement or Other Documents, and negotiation for and execution of this Agreement (the “Released Claims”). Each Borrower hereby covenants and agrees never to institute any action or suit at law or in equity, nor institute, prosecute, or in any way aid in the institution or prosecution of, any claim, action or cause of action, rights to recover debts or demands of any nature against any of the released parties arising out of or related to a released party's actions, omissions, statements, requests or demands in administering, enforcing, monitoring, collecting or attempting to collect, the obligations, indebtedness and other obligations of an obligor to a released party. Each Borrower agrees to indemnify and hold Agent and each Lender harmless from any and all matters released pursuant to this paragraph. Each Borrower acknowledges that the agreements in this paragraph are intended to be in full satisfaction of all or any alleged injuries or damages to such Released Party arising in connection with such matters released pursuant to the other provisions of this paragraph. Each Borrower represents and warrants to Agent and Lenders that it has not purported to transfer, assign or otherwise convey any right, title or interest of a Borrower in any Released Claim to any other Person and that the foregoing constitutes a full and complete release of each Borrower’s claims with respect to all such matters. The provisions of this Section 12(c) and the representations, warranties, releases, waivers, acquittances, discharges, covenants, agreements and indemnifications contained herein (a) constitute a material consideration for and inducement to Agent and Lenders entering into this Agreement, (b) do not constitute an admission of or basis for establishing any duty, obligation or liability of Agent or a Lender to a Borrower or any other Person, (c) do not constitute an admission of or basis for establishing any liability, wrongdoing, or violation of any obligation, duty or agreement of Agent or a Lender to a Borrower or any other Person, and (d) shall not be used as evidence against Agent or a Lender by a Borrower, any successor of a Borrower, or any other Person for any purpose.

 

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

 

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

 

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

 

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

 

 

[Signature Pages Follow]

 

 

 

 

	 	
			PNC BANK, NATIONAL ASSOCIATION,

			as Agent and Lender

			
	 	 
	 	By   :   /s/ Kayl Reuter                           
	 	Name: Kayla Reuter
	 	Title:   Vice President

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

	 	BORROWERS:
	 	 
	 	ION GEOPHYSICAL CORPORATION
	 	 
	 	By:      /s/ Michael Morrison                      
	 	Name: Michael Morrison
	 	Title:   EVP & CFO
	 	 
	 	GX TECHNOLOGY CORPORATION
	 	 
	 	By:      /s/ Michael Morrison                      
	 	Name: Michael Morrison
	 	Title:   EVP & CFO
	 	 
	 	ION EXPLORATION PRODUCTS (U.S.A.), INC.
	 	 
	 	By:      /s/ Michael Morrison                   
	 	Name: Michael Morrison
	 	Title:   Vice President
	 	 
	 	I/O MARINE SYSTEMS, INC.
	 	 
	 	By:      /s/ Michael Morrison                   
	 	Name: Michael Morrison
	 	Title:   Vice President
	 	 
	 	GX GEOSCIENCE Corporation, S. DE R.L. DE C.V.
	 	 
	 	By:      /s/ Michael Morrison                   
	 	Name: Michael Morrison
	 	Title:   Vice President & Attorney-in-Fact

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