FIRST AMENDMENT TO CREDIT AGREEMENT AND WAIVER
Exhibit
10.33
FIRST
AMENDMENT TO CREDIT AGREEMENT AND WAIVER
This
FIRST AMENDMENT TO CREDIT AGREEMENT (this “Amendment”)
dated
as of February 26, 2008 (the “Effective
Date”)
is
executed among ION
GEOPHYSICAL CORPORATION,
formerly known as Input/Output, Inc., a Delaware corporation (the “Borrower”),
the
Subsidiaries of the Borrower listed on the signature pages hereto as Guarantors,
the banks and other financial institutions party hereto (the “Lenders”)
and
CITIBANK,
N.A.,
as
Administrative Agent (in such capacity, the “Administrative
Agent”).
INTRODUCTION
A. WHEREAS,
the Borrower (under the name “Input/Output, Inc.”), the Guarantors, the certain
financial institutions, as lenders, and the Administrative Agent are parties
to
that certain Credit Agreement dated as of March 22, 2007 (as amended
or modified prior to the date hereof, the “Credit
Agreement”).
B. WHEREAS,
Borrower has now requested that the Administrative Agent and the Lenders modify
the Credit Agreement and change certain terms thereof, and the Administrative
Agent and the Lenders have agreed to do so; and
C. WHEREAS,
Borrower, Administrative Agent and the Lenders wish to execute this Amendment
to
evidence such agreement;
THEREFORE,
the Borrower, the Guarantors, the Lenders and the Administrative Agent hereby
agree as follows:
ARTICLE
I
AMENDMENT
AMENDMENT
SECTION
1.1 Definitions.
All capitalized terms used herein and not otherwise defined shall have the
meanings given in the Credit Agreement.
SECTION
1.2 Amendment
to Section 1.01. Section 1.01 of the Credit Agreement is hereby amended to
include the following new definitions and to restate the definitions of “Fixed
Charge Coverage Ratio” and “Total Funded Debt” as follows:
“Domestic
Fixed Charge Coverage Ratio”
means,
at any date, the ratio of (i) Consolidated EBITDA of the Borrower and its
Domestic Subsidiaries less the sum of: (A) cash income tax expense of the
Borrower and its Domestic Subsidiaries, (B) non-financed Consolidated Capital
Expenditures and (C) capitalized research and development costs of the Borrower
and its Domestic Subsidiaries; to (ii) the (A) scheduled payments of lease
payments of the Borrower and its Domestic Subsidiaries, (B) scheduled payments
of principal of Indebtedness of the Borrower and its Domestic Subsidiaries,
(C)
Consolidated Interest Expense of the Borrower and its Domestic Subsidiaries
actually paid and (D) dividends paid in cash by the Borrower, in each case
for
the period of four consecutive fiscal quarters most recently ended on or prior
to such date for which financial information is available.
1
“Domestic
Leverage Ratio”
means,
at any date, the ratio of (i) Domestic Total Funded Debt as such date to (ii)
Consolidated EBITDA of the Borrower and its Domestic Subsidiaries for the four
consecutive fiscal quarters most recently ended on or prior to such date for
which financial information is available.
“Domestic
Total Funded Debt”
means
all funded Consolidated Indebtedness of the Borrower and its Domestic
Subsidiaries, plus Capital Lease Obligations of the Borrower and its Domestic
Subsidiaries and issued letters of credit of the Borrower and its Domestic
Subsidiaries.
“Fixed
Charge Coverage Ratio”
means,
at any date, the ratio of (i) Consolidated EBITDA of the Borrower and its
Subsidiaries less the sum of: (A) cash income tax expense of the Borrower and
its Subsidiaries, (B) non-financed Consolidated Capital Expenditures and (C)
capitalized research and development costs of the Borrower and its Subsidiaries;
to (ii) the (A) scheduled payments of lease payments of the Borrower and
its Subsidiaries, (B) scheduled payments of principal of Indebtedness of the
Borrower and its Subsidiaries, (C) Consolidated Interest Expense of the Borrower
and its Subsidiaries actually paid and (D) dividends paid by the Borrower in
cash, in each case for the period of four consecutive fiscal quarters most
recently ended on or prior to such date for which financial information is
available.
“Total
Funded Debt”
means
all Funded Consolidated Indebtedness of the Borrower and its Subsidiaries,
plus
Capital Lease Obligations of the Borrower and its Subsidiaries, plus issued
letters of credit of the Borrower and its Subsidiaries.
SECTION
1.3 Amendment
to Section 6.01. Section 6.01 of the Credit Agreement is hereby amended by
deleting the word “and” at the end of the existing clause (o), replacing the
period at the end of the existing clause (p) with “; and” and adding
the following new section 6.01(q) at the end of Section 6.01:
“(q)
Indebtedness not to exceed $150,000,000 in the aggregate until the end of the
Borrower’s 2008 fiscal year and not to exceed $135,000,000 in the aggregate
thereafter owed by I/O International, Ltd., or ION International Sarl, a
Luxembourg Person, to Borrower or any Domestic Subsidiary in connection with
licensing agreements with respect to Intellectual Property, which Indebtedness
may be evidenced by one or more promissory notes.
For the avoidance of doubt, such Indebtedness shall not be a Receivable of
Borrower or any Domestic Subsidiary.”
SECTION
1.4 Amendment
to Section 6.08. Section 6.08 of the Credit Agreement is hereby amended by
adding the following new section 6.08(i) to the end of Section
6.08:
“(i) transactions
between or among Affiliates of the Borrower permitted by
Section 6.04;”
SECTION
1.5 Addition
of Sections 6.17, 6.18 and 6.19. New Sections 6.17, 6.18 and 6.19 are hereby
added to the Credit Agreement as follows:
“Section
6.17 Minimum Domestic Fixed Charge Coverage Ratio.
The Borrower shall not permit the Domestic Fixed Charge Coverage Ratio to be
less than 1.50 to 1.0.
2
Section
6.18 Maximum Domestic Leverage Ratio The
Borrower shall not permit the Domestic Leverage Ratio to exceed 1.5 to
1.0.
Section
6.19 Domestic
Asset Coverage Ratio.
The
Borrower shall not permit the ratio of (i) the book value of Receivables (to
the
extent earned by performance), plus cash on hand and Permitted Investments,
plus
inventory plus equipment, in each case, of the Borrower and its Domestic
Subsidiaries to (ii) the aggregate Commitments of the Lenders to be less than
1.75 to 1.0 at any time.”
SECTION
1.6 Waiver.
For the avoidance of doubt, the Lenders hereby waive any breach prior to the
date hereof, if any, of (a) Section 5.01(c) of the Credit Agreement caused
by
Borrower’s delivery on February 19, 2008, of the Borrowing Base Certificate and
related calculations that was due on January 30, 2008; and (b) Section 6.01
of
the Credit Agreement caused by the existence prior to the date hereof of any
Indebtedness (if any) of the type described in Section 1.3 above.
ARTICLE
II
MISCELLANEOUS
MISCELLANEOUS
SECTION
2.1 Representations
True; No Default. The Borrower and the Guarantors represent and warrant, as
applicable, that:
(a) This
Amendment has been duly authorized, executed and delivered on their behalf
and
the Credit Agreement, together with each other Loan Documents to which the
Borrower and each of the Guarantors is a party, constitute valid and legally
binding agreements of the Borrower and the Guarantors enforceable in accordance
with their terms, except as enforceability thereof may be limited by bankruptcy,
insolvency, fraudulent conveyance, fraudulent transfer, reorganization or
moratorium or other similar law relating to creditors’ rights and by general
equitable principles which may limit the right to obtain equitable remedies
(regardless of whether such enforceability is considered in a proceeding, in
equity or at law);
(b) After
giving effect to this Amendment, the representations and warranties of the
Borrower contained in Article
III
of the
Credit Agreement are true and correct in all material respects on and as of
the
date hereof as though made on and as of the date hereof, except to the extent
such representations and warranties relate solely to an earlier date;
and
(c) After
giving effect to this Amendment, there has not occurred and is not continuing
a
Default or an Event of Default.
SECTION
2.2 Effectiveness.
This Amendment shall become effective as of the Effective Date upon receipt
by
the Administrative Agent of executed signature pages hereof from the Borrower,
the Guarantors and Lenders constituting at least the Required
Lenders.
SECTION
2.3 Expenses,
Additional Information. The Borrower shall pay to the Administrative Agent
all
reasonable expenses incurred in connection with the negotiation and execution
of
this Amendment. The Borrower and the Guarantors shall furnish to the
Administrative Agent all such other documents, consents and information relating
to the Borrower and the Guarantors as the Administrative Agent may reasonably
require to accomplish the purposes hereof.
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SECTION
2.4 Miscellaneous
Provisions.
(a) From
and
after the Effective Date of this Amendment, the Credit Agreement shall be deemed
to be amended and modified as herein provided, and except as so amended and
modified the Credit Agreement shall continue in full force and
effect.
(b) From
and
after the Effective Date of this Amendment, the Credit Agreement and this
Amendment shall be read and construed as one and the same
instrument.
(c) From
and
after the Effective Date of this Amendment, any reference in any of the Loan
Documents to the Credit Agreement shall be a reference to the Credit Agreement
as amended by this Amendment.
(d) This
Amendment may be signed in any number of counterparts and by different parties
in separate counterparts, each of which shall be deemed an original but all
of
which together shall constitute one and the same instrument.
(e) The
headings herein shall be accorded no significance in interpreting this
Amendment.
SECTION
2.5 Binding
Effect. As of the Effective Date of this Amendment, this Amendment shall be
binding upon and inure to the benefit of the Borrower, the Guarantors,
Administrative Agent and Lenders and the successors and assigns of the
Administrative Agent and Lenders. The Borrower and the Guarantors shall not
have
the right to assign its rights hereunder or any interest herein.
SECTION
2.6 Choice
of
Law. THIS AMENDMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF
NEW YORK, EXCEPT TO THE EXTENT THAT THE LAWS OF THE UNITED STATES OF AMERICA
AND
ANY RULES, REGULATIONS OR ORDERS ISSUED OR PROMULGATED THEREUNDER APPLICABLE
TO
THE AFFAIRS AND TRANSACTIONS OF THE LENDERS OTHERWISE PREEMPT NEW YORK LAW,
IN
WHICH EVENT SUCH FEDERAL LAW SHALL CONTROL.
[Signature
Page Follows]
4
EXECUTED
to be effective as of the date first written above.
BORROWER: | ||
ION GEOPHYSICAL CORPORATION, a Delaware corporation |
||
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By: | /s/ Xxxxx X. Xxxxxx | |
Name: Xxxxx X. Xxxxxx |
||
Title: Senior Vice President and General Counsel |
GUARANTORS: | ||
GMG/AXIS, Inc., a Delaware corporation | ||
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By: | /s/ Xxxxx X. Xxxxxx | |
Name: Xxxxx X. Xxxxxx |
||
Title: Vice President and Director |
GX TECHNOLOGY CORPORATION, a Texas corporation | ||
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By: | /s/ Xxxxx X. Xxxxxx | |
Name: Xxxxx X. Xxxxxx |
||
Title: Vice President and Director |
BORROWER: | ||
I/O EXPLORATION PRODUCTS (U.K.), Inc., a Delaware corporation |
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By: | /s/ Xxxxx X. Xxxxxx | |
Name: Xxxxx X. Xxxxxx |
||
Title: Vice President and Director |
[Signature
Page]
I/O
EXPLORATION
PRODUCTS (U.S.A.), Inc., a Delaware corporation |
||
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By: | /s/ Xxxxx X. Xxxxxx | |
Name: Xxxxx X. Xxxxxx |
||
Title: Vice President and Director |
I/O MARINE SYSTEMS, INC., a Louisiana corporation | ||
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By: | /s/ Xxxxx X. Xxxxxx | |
Name: Xxxxx X. Xxxxxx |
||
Title: Vice President and Director |
I/O NEVADA, LLC, a Delaware limited liability company | ||
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By: | /s/ Signed | |
Name: |
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Title: |
I/O TEXAS, LP, a Delaware limited partnership | ||
By: | Input/Output,
Inc., a Delaware corporation,
its
General Partner
|
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By: /s/ Xxxxx X. Xxxxxx | ||
Name:
Xxxxx X. Xxxxxx
|
||
Title: Senior Vice President and General Counsel |
IPOP MANAGEMENT, INC., a Delaware corporation | ||
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By: | /s/ Xxxxx X. Xxxxxx | |
Name: Xxxxx X. Xxxxxx |
||
Title: Vice President and Director |
ADMINISTRATIVE AGENT AND LENDER: | ||
CITIBANK, N.A | ||
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By: | /s/ Signed | |
Name: |
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Title: |
LENDERS: | ||
WHITNEY NATIONAL BANK | ||
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By: | /s/ Signed | |
Name: |
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Title: |
PNC BANK, NATIONAL ASSOCIATION | ||
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By: | /s/ Signed | |
Name: |
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Title: |