EXHIBIT 10.49
REVOLVING CREDIT AGREEMENT
THIS REVOLVING CREDIT AGREEMENT (the "AGREEMENT"), dated as of
December 11, 1998, is between SEITEL, INC., a Delaware corporation (the
"BORROWER"), and SUNTRUST BANK, ATLANTA, a Georgia banking corporation (the
"BANK").
RECITALS:
WHEREAS, the Borrower has requested the Bank to establish a revolving
credit facility for advances up to an aggregate principal amount outstanding not
to exceed $25,000,000;
WHEREAS, the Bank is willing to establish such revolving credit
facility to the Borrower upon the terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
1. TERMS OF COMMITMENT
(a) ADVANCES. Subject to the terms and conditions of this Agreement,
the Bank agrees to make one or more Advances to the Borrower from time to time
from the date hereof to the Termination Date in an aggregate principal amount at
any time outstanding not to exceed the Commitment. Subject to the foregoing
limitations, and the other terms and conditions of this Agreement, the Borrower
may borrow, repay, and reborrow under the Commitment; PROVIDED, that the
Borrower may neither borrow nor reborrow (but can continue, prior to
acceleration, any Advance pursuant to paragraph (c)(iii) below hereof) if a
Potential Default or an Event of Default exists.
(b) INTEREST. The outstanding principal amount of the Advances shall
bear interest prior to maturity at the following rates per annum which may be
selected by the Borrower subject to and in accordance with the terms of this
Agreement:
(i) the Base Rate, PLUS the Applicable Margin; or
(ii) LIBOR for the applicable Interest Period, PLUS the
Applicable Margin.
Accrued and unpaid interest on the outstanding Advances shall be due
and payable (i) with respect to all Base Rate Advances, on the last Business Day
of each March, June, September and December, (ii) with respect to all LIBOR
Advances, on the last day of the applicable Interest Period, (iii) on the date
of any prepayment in accordance with SECTION 1(E) hereof and (iv) on the
Termination Date. Notwithstanding the foregoing, upon the occurrence of a
Potential Default or Event of Default hereunder, at the Bank's option, all
outstanding Advances shall bear interest at the Default Rate, which interest
shall be payable from time to time on demand.
(c) BORROWING PROCEDURE. (i) The Borrower shall give the Bank notice by
means of a borrowing notice for each requested Advance by not later than 11: 00
A.M. (Atlanta, Georgia time), in the case of LIBOR Advances two (2) Business
Days prior to the date of such Advance, and in the case of Base Rate Advances,
on the same day as such Advance, specifying: (i) the requested date of such
Advance (which shall be a Business Day), (ii) the amount of such Advance, and
(iii) in the case of a LIBOR Advance, the duration of the initial Interest
Period. The Bank at its option may accept telephonic requests for Advances,
provided that such acceptance shall not constitute a waiver of the Bank's right
to delivery of a borrowing notice in connection with subsequent Advances. Any
telephonic request for an Advance by the Borrower shall be promptly confirmed by
submission of a properly completed borrowing notice to the Bank. Each Advance
shall be in a minimum principal amount of $1,000,000 or a greater integral
multiple of $100,000. Subject to the other terms and conditions of this
Agreement, not later than 2:00 P.M. (Atlanta, Georgia time) on the date
specified for each Advance, the Bank will make such Advance available to the
Borrower by depositing the same, in immediately available funds, into an account
of the Borrower at the Bank or by wire transfer into an account at another
financial institution designated by the Borrower. All notices under this
paragraph shall be irrevocable. Any notice under this paragraph received by the
Bank after the prescribed times set forth above shall be deemed to have been
received on the next Business Day.
(ii) The Borrower shall give the Bank notice by not later
than 11:00 A.M. (Atlanta, Georgia time) two (2) Business Days prior to
the end of any Interest Period of its intention to continue any
outstanding LIBOR Advance for a new Interest Period and the duration
of such new Interest Period. All such notices shall be irrevocable. If
the Borrower shall fail to give the Bank notice as specified herein,
such LIBOR Advance shall be automatically continued for an Interest
Period of one (1) month. All Base Rate Advances shall automatically
continue as Base Rate Advances unless the Borrower shall give notice
to the Bank that it wishes to convert a Base Rate Advance to a LIBOR
Advance, in which case the Borrower shall comply with the procedures
specified in paragraph (i) above. The Borrower may also convert any
LIBOR Advance to a Base Rate Advance at the end of an Interest Period.
(iii) Notwithstanding the foregoing, if a Potential Default
or an Event of Default exists, all Advances shall, if not repaid or
accelerated, be continued as Base Rate Advances after the expiration
of the then current Interest Period.
(d) USE OF PROCEEDS. The proceeds of all Advances shall be used by the
Borrower for general working capital needs.
(e) OPTIONAL PREPAYMENTS. The Borrower may, upon at least two (2)
Business Day's prior notice to the Bank, prepay any Advance, in whole at any
time or from time to time in part without premium or penalty but with accrued
interest to the date of prepayment on the amount so prepaid; PROVIDED, that an
Advance may be prepaid only on the last day of the Interest Period unless the
Bank consents and the Borrower pays to the Bank any amount due under paragraph
(i) hereunder, and each partial prepayment shall be in the principal amount of
$1,000,000 or a greater integral multiple of $100,000. All notices hereunder
shall be irrevocable.
(f) COMPUTATION OF INTEREST AND ALL FEES. Interest hereunder shall be
computed on the basis of a year of 360 days and the actual number of days
elapsed (including the first day but excluding the last day).
(g) CHANGE IN CIRCUMSTANCES. Sections 3.1, 3.2, 3.3 and 3.5 of the
First Chicago Credit Agreement are hereby incorporated by reference herein and
made applicable to the Advances hereunder.
(h) SUBSTITUTE BASE RATE BORROWINGS. If the obligation of the Bank to
make LIBOR Advances shall be suspended pursuant to paragraph (g) hereof, the
Borrower shall have the option to repay or prepay all affected Advances or to
convert such LIBOR Advances to Base Rate Advances until such time as such
conditions causing such suspension shall no longer be effective in the sole
discretion of the Bank.
(i) FUNDING INDEMNIFICATION. If any payment of an LIBOR Advance occurs
on a date which is not the last day of the applicable Interest Period, whether
because of prepayment, acceleration or otherwise, or a LIBOR Advance is not made
on the date specified by the Borrower for any reason other than a default by the
Bank, the Borrower will indemnify the Bank for any loss or cost incurred by it
resulting therefrom, including, without limitation, any loss or cost in
liquidating or employing deposits acquired to fund or maintain such LIBOR
Advance.
2. CONDITIONS PRECEDENT
(a) INITIAL ADVANCE. The obligation of the Bank to make the initial
Advance is subject to the following condition precedents:
(i) the receipt on or before the day of such Advance all of
the following, each dated (unless otherwise indicated) the date
hereof, in form and substance satisfactory to the Bank:
(1) This Agreement and the Revolving Credit Note,
each duly executed by the Borrower.
(2) A certificate of good standing for the
Borrower and each Restricted Subsidiary which is a
corporation, and a certificate of existence for each
Restricted Subsidiary which is a partnership, each certified
by the appropriate governmental officer in its jurisdiction
of incorporation or organization, as the case may be.
(3) Copies (x) certified by the Secretary or
Assistant Secretary of the Borrower and of each Restricted
Subsidiary which is a corporation, respectively, of its
articles of incorporation (together with all amendments
thereto) and its by-laws and of its Board of Directors'
resolutions (and resolutions of other bodies, if any are
deemed necessary by counsel for the Bank) authorizing the
execution of the Loan Documents to which such entity is a
party and (u) certified by the Secretary or Assistant
Secretary of the general partner of each Restricted
Subsidiary which is a partnership of its partnership
agreement and any partnership certificate or other
significant governing document, and of any partnership
actions authorizing the execution of the Loan Documents to
which such entity is a party.
(4) Incumbency certificates, executed by the
Secretary or Assistant Secretary of the Borrower and of each
Restricted Subsidiary, which shall identify by name and
title and bear the signature of the officers of such entity
authorized to sign the Loan Documents to which it is a party
and (in the case of the Borrower) to make borrowings
hereunder, upon which certificates the Bank shall be
entitled to rely until informed of any change in writing by
the Borrower or by a Restricted Subsidiary, as the case may
be.
(5) A certificate, signed by a Senior Financial
Officer of the Borrower, stating that on the initial
borrowing date no Event of Default or Potential Default has
occurred and is continuing and demonstrating compliance, on
and as of the initial Borrowing Date, with the financial
covenants set forth in paragraph (f) under the heading
"COVENANTS" herein and with Section 6.20 of the First
Chicago Credit Agreement.
(6) A written opinion of counsel to the Borrower
and the Restricted Subsidiaries in form and substance
satisfactory to the Bank.
(7) Written money transfer instructions addressed
to the Bank and signed by an Authorized Officer, together
with such other related money transfer authorization as the
Bank may have reasonably requested.
(8) The Subsidiary Guaranty duly executed by each
Restricted Subsidiary.
(9) A copy of the most recent reserve report of
the type described in Section 6.1(g) of the First Chicago
Credit Agreement.
(10) A copy of the notice delivered to the Agent
pursuant to Section 6.1(j) of the First Chicago Credit
Agreement.
(11) Such other documents as the Bank or its
counsel may have reasonably requested.
(ii) CLOSING FEE. The payment to the Bank of a closing fee
equal to $135,000.
(b) ALL ADVANCES. The obligation of the Bank to make any Advance
(including the initial Advance) is subject to the following additional
conditions precedent:
(i) NO DEFAULT. No Event of Default or Potential Default
shall have occurred and be continuing or would result from such
Advance;
(ii) REPRESENTATIONS AND WARRANTIES. All of the
representations and warranties contained in the Loan Documents shall
be true and correct on and as of the date of such Advance with the
same force and effect as if such representations and warranties had
been made on and as of such date; and
(iii) ADDITIONAL DOCUMENTATION. The Bank shall have received
such additional approvals, opinions, or documents as the Bank or its
legal counsel may reasonably request.
3. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Bank that:
(a) ORGANIZATION; POWER AND AUTHORITY. (i) the Borrower (1) is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware; (2) is duly qualified as a foreign corporation and is
in good standing in each jurisdiction in which such qualification is required by
law, other than those jurisdictions as to which the failure to be so qualified
or in good standing could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect; and (3) has the corporate power and
authority to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts and proposes to transact, to
execute and deliver this Agreement and to perform its obligations hereunder.
(ii) Each Restricted Subsidiary (1) is a corporation or a
partnership duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization;
(2) is duly qualified as a foreign corporation or partnership and is
in good standing in each jurisdiction in which such qualification is
required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse
Effect; and (3) has the corporate or partnership power and authority
to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts and proposes to
transact, to execute and deliver the Subsidiary Guaranty and to
perform the provisions hereof and thereof.
(b) AUTHORIZATION AND VALIDITY. (i) The execution and delivery of this
Agreement and the Revolving Credit Note and the performance by the Borrower of
its obligations hereunder and thereunder have been duly authorized by all
necessary corporate action on the part of the Borrower, and this Agreement and
the Revolving Credit Note constitute the legal, valid and binding obligations of
the Borrower enforceable against the Borrower in accordance with its terms,
except as such enforceability may be limited by (A) applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and (B) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(ii) The execution and delivery of the Subsidiary Guaranty
and the performance by each Restricted Subsidiary of its obligations
thereunder has been duly authorized by all necessary corporate or
partnership action on the part of each Restricted Subsidiary, and the
Subsidiary Guaranty constitutes a legal, valid and binding obligation
of each Restricted Subsidiary enforceable against such Restricted
Subsidiary in accordance with its terms, except as such enforceability
may be limited by (A) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and (B) general principles
of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).
(c) ACCURACY OF INFORMATION. No information, exhibit or report
furnished by the Borrower or any of its Subsidiaries to the Bank in connection
with the negotiation of, or compliance with, this Agreement or the Subsidiary
Guaranty contained, as of the date of such information, exhibit or report, any
material misstatement of fact or omitted to state a material fact necessary to
make the statements contained therein no misleading, or any other material fact
required pursuant to the terms of this Agreement to be contained therein.
(d) ORGANIZATION AND OWNERSHIP OF SHARES OF RESTRICTED SUBSIDIARIES;
AFFILIATES. (i) Schedule 1 contains (except as noted therein) complete and
correct lists of (1) the Restricted Subsidiaries, showing, as to each Restricted
Subsidiary, the correct name thereof, the jurisdiction of its organization and
the percentage of shares of each class of its outstanding capital stock or
similar equity interests owned by the Borrower and each other Restricted
Subsidiary, and (2) the Borrower's Affiliates (other than Restricted
Subsidiaries).
(ii) All of the outstanding shares of capital stock or
similar equity interests of each Restricted Subsidiary shown in
Schedule 1 as being owned by the Borrower and the Restricted
Subsidiaries have been validly issued, are fully paid and
nonassessable and are owned by the Borrower or another Restricted
Subsidiary free and clear of any Lien (except as otherwise disclosed
in Schedule 1).
(iii) No Restricted Subsidiary is a party to, or otherwise
subject to any legal restriction or any agreement (other than this
Agreement, the First Chicago Credit Agreement, the agreements listed
on Schedule 2 and customary limitations imposed by corporate or
partnership law statutes) restricting the ability of such Restricted
Subsidiary to pay dividends out of profits or make any other similar
distributions of profits to the Borrower or any of the Restricted
Subsidiaries that owns outstanding shares of capital stock or similar
equity or partnership interests of such Restricted Subsidiary.
(e) FINANCIAL STATEMENTS. The December 31, 1997 audited consolidated
financial statements of the Borrower and the Restricted Subsidiaries heretofore
delivered to the Bank (including in each case the related schedules and notes)
present fairly, in all material respects, the consolidated financial position of
the Borrower and the Restricted Subsidiaries as of the respective dates
specified therein and the consolidated results of their operations and cash
flows for the respective periods so specified and have been prepared in
accordance with generally accepted accounting principles in effect on the date
such statements were prepared consistently applied throughout the periods
involved except as set forth in the notes thereto (subject, in the case of any
interim financial statements, to normal year end adjustments).
(f) MATERIAL ADVERSE CHANGE. Since December 31, 1997, there has been no
change in the business, Property, prospects, condition (financial or otherwise)
or results of operations of the Borrower and the Restricted Subsidiaries which
could reasonably be expected to have a Material Adverse Effect.
(g) NO CONFLICT OR VIOLATION. Neither the execution, delivery and
performance by the Borrower of the Agreement, nor the execution, delivery and
performance by any Restricted Subsidiary of the Subsidiary Guaranty, will (i)
contravene, result in any breach of, or constitute a default under, or result in
the creation of any Lien in respect of any Property of the Borrower or any
Restricted Subsidiary under, any indenture, mortgage, deed of trust, loan,
purchase or credit agreement, lease, corporate charter or by-laws, partnership
agreement or other significant governing document, or any other agreement or
instrument to which the Borrower or any Restricted Subsidiary is bound or by
which the Borrower or any Restricted Subsidiary or any of their respective
properties may be bound or affected, (ii) conflict with or result in a breach of
any of the terms, conditions or provisions of any order, judgment, decree, or
ruling of any court, arbitrator or Governmental Authority applicable to the
Borrower or any Restricted Subsidiary or (iii) violate any provision of any
statute or other rule or regulation of any Governmental Authority applicable to
the Borrower or any Restricted Subsidiary.
(h) GOVERNMENTAL AUTHORIZATIONS. No consent, approval or authorization
of, or registration, filing or declaration with, any Governmental Authority is
required in connection with the execution, delivery or performance (i) by the
Borrower of this Agreement or (ii) by any Restricted Subsidiary of the
Subsidiary Guaranty.
(i) INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM FIRST CHICAGO
CREDIT AGREEMENT. The Borrower hereby makes and reaffirms to the Bank each of
the representations and warranties set forth in Sections 5.9 through 5.14,
5.15(b) and 5.17 of the First Chicago Credit Agreement, all of which are
incorporated in this Agreement by this reference, with the same force and effect
as if such representations and warranties had been set forth in their entirety
in this Agreement.
4. COVENANTS
In order further to induce the Bank to establish the Commitment and to
make Advances to the Borrower thereunder, the Borrower agrees with the Bank that
it will observe and perform the following covenants and obligations during the
term of this Agreement:
(a) FINANCIAL REPORTING. (i) The Borrower shall deliver to the Bank the
financial statements and other financial reports required pursuant to Section
6.1, and the officer's certificate required pursuant to Section 6.2, of the
First Chicago Credit Agreement at the same time that such documents are
delivered to the Agent or any Lender thereunder; PROVIDED, that the officer's
certificate referenced in Section 6.2 shall include all financial covenants set
forth in paragraph (f) hereof as well as Section 6.20 of the First Chicago
Credit Agreement incorporated by reference herein and the statement referenced
in paragraph (b) thereof shall refer instead to "Potential Default" and "Event
of Default" hereunder.
(ii) Promptly, and in any case within 5 Business Days after
the Borrower becomes aware of any material issues or events which
would cause the Borrower not to be Year 2000 Compliant and Ready (as
defined in paragraph (h) under the heading "COVENANTS"), a statement
of the chief executive officer, chief financial officer, or chief
technology officer of the Borrower setting forth the details thereof
and the action which the Borrower is taking or proposes to take with
respect thereto, and promptly upon the receipt thereof, a copy of any
third party assessments of the Borrower's Y2K Plan together with any
recommendations made by such third party with respect to Year 2000
compliance.
(b) PARI PASSU. The Borrower covenants that its Obligations under this
Agreement do and will rank at least PARI PASSU with the indebtedness under the
First Chicago Credit Agreement and all other present and future unsecured Senior
Debt.
(c) SUBSIDIARY GUARANTY. The Borrower will cause each Subsidiary which
becomes a Restricted Subsidiary after the date of this Agreement to execute and
deliver to the Bank a joinder agreement substantially similar to the joinder
agreement in the First Chicago Credit Agreement, duly executed by such
Subsidiary, together with an opinion of counsel satisfactory to the Bank
addressing with respect to such Subsidiary the issues relating to Subsidiaries
and the Subsidiary Guaranty in the form of opinion attached to the First Chicago
Credit Agreement as Exhibit "K".
(d) EXPENSES; INDEMNITY. The Borrower agrees to pay promptly all costs
and expenses incurred by the Bank in connection with any amendments, waivers or
consents in respect of this Agreement and any other Loan Document. In addition,
the Borrower agrees to indemnify the Bank and its affiliates, directors,
officers, employees and agents against all costs, losses, liabilities, damages
and expenses incurred in connection with this Agreement and the Advances
evidenced by the Revolving Credit Note and the use by the Borrower of the
proceeds hereof, unless caused by the gross negligence or willful misconduct of
any such indemnified party.
(e) INCORPORATION OF COVENANTS FROM FIRST CHICAGO CREDIT AGREEMENT. The
Borrower agrees to observe and perform each of the covenants and agreements set
forth in Sections 6.7 through 6.17 and Section 6.20 of the First Chicago Credit
Agreement, all of which covenants and agreements are incorporated in this
Agreement by this reference, all with the same force and effect as if such
covenants and agreements had been set forth in their entirety in this Agreement;
PROVIDED, that any reference to "Agent" or "each Lender" shall refer to the
Bank; and PROVIDED FURTHER, that the last paragraph of Section 6.15 of the First
Chicago Credit Agreement shall also apply to the Obligations under this
Agreement and the Revolving Credit Note, so that the Commitment and all Advances
made under the Revolving Credit Note shall at all times be equally secured on a
PARI PASSU basis with the lenders under the First Chicago Credit Agreement. Any
violation of Section 6.15 of the First Chicago Credit Agreement as incorporated
by reference herein shall constitute a Potential Default hereunder, whether or
not any such provision is made or any equitable Lien is created pursuant hereto
or thereto.
(f) FINANCIAL COVENANTS.
(i) Consolidated Net Worth shall not be less than $108
Million PLUS an aggregate amount equal to fifty percent (50%) of
Consolidated Net Income (but, in each case, only if a positive number)
for each completed fiscal year beginning with the fiscal year ending
12/31/98.
(ii) EBITDA for the period of four consecutive fiscal
quarters of the Borrower then most recently ended shall not be less
than five hundred percent (500%) of Consolidated Interest Expense for
such period.
(iii) Consolidated Debt shall not exceed fifty per cent
(50%) of Total Capitalization for any fiscal quarter of the Borrower
and its Restricted Subsidiaries on a consolidated basis.
(g) EFFECT OF TERMINATION OF FIRST CHICAGO CREDIT AGREEMENT. The
Borrower agrees that, if the First Chicago Credit Agreement is terminated or
otherwise ceases to be in force and effect prior to the Termination Date, the
representations and warranties, covenants, and the Events of Default set forth
therein that are incorporated in this Agreement by reference or otherwise
referred to in this Agreement, shall nevertheless be deemed to survive and
continue in full force and effect for all purposes of this Agreement. In such
event, the Borrower agrees, upon request by the Bank, to enter into an amendment
to this Agreement to set forth specifically in this Agreement all such
representations and warranties, covenants, and Events of Default, but no such
action shall be required in order to effect the survival and continuation of
such provisions.
(h) YEAR 2000 COMPLIANCE. The Borrower has developed a comprehensive
working plan (the "Y2K PLAN") to insure that the Borrower's software and
hardware systems which impact or affect in any material way the business
operations of the Borrower will be Year 2000 Compliant and Ready (defined below)
by not later than June 30, 1999. Upon request of the Bank, the Borrower will
deliver to the Bank a copy of such Y2K Plan and a copy of any third party
assessment of the Y2K Plan (if available). The Borrower has met the Y2K Plan
milestones such that all hardware and software systems will be Year 2000
Compliant and Ready in accordance with the Y2K Plan, except for any such failure
to meet such milestones which would not have a Material Adverse Effect. As used
herein, "YEAR 2000 COMPLIANT AND READY" means that the Borrower's hardware and
software systems with respect to the operation of its business and its general
business plan will: (i) handle date information involving any and all dates
before, during and/or after January 1, 2000, including accepting input,
providing output and performing date calculations in whole or in part; (ii)
operate accurately without interruption on and in respect of any and all dates
before, during and/or after January 1, 2000 and without any change in
performance; (iii) respond to and process two digit year input without creating
any ambiguity as to the century; and (iv) store and provide date input
information without creating any ambiguity as to the century.
5. EVENTS OF DEFAULTS; REMEDIES.
Each of the following events shall constitute an "Event of Default"
under this Agreement:
(a) Failure by the Borrower to pay any principal when due; or failure
by the Borrower to pay any interest or any other amount under this Agreement
within five (5) days after the same becomes due; or
(b) Failure by the Borrower to perform or observe any covenant or
agreement set forth in paragraph (f) under the heading "COVENANTS" hereinabove
or any of the covenants incorporated by reference under paragraph (e) under the
heading "COVENANTS" hereinabove which constitute immediate Defaults under
Section 7.3 of the First Chicago Credit Agreement; or
(c) Failure by the Borrower to perform or observe any covenant or
agreement set forth in paragraphs (b), (c), (d) or (h) under the heading
"COVENANTS" hereinabove or any of the covenants incorporated by reference under
paragraph (e) under the heading "COVENANTS" hereinabove which are not included
in paragraph (b) above, which failure remains unremedied for 30 days after the
earlier of its discovery by the Borrower or written notice thereof to the
Borrower by the Bank;
(d) Any representation or warranty made or deemed made by or on behalf
of the Borrower or any of its Subsidiaries to the Bank under or in connection
with this Agreement or any certificate or information delivered in connection
with the Agreement or the Subsidiary Guaranty shall be materially false on the
date as of which made; or
(e) The Borrower or any Restricted Subsidiary shall fail to pay its
debts generally as they come due, or shall file any petition or action for
relief under any bankruptcy, reorganization, insolvency or moratorium law, or
any other law or laws for the relief of, or relating to, debtors; or
(f) An involuntary petition shall be filed under any bankruptcy statute
against the Borrower or any Restricted Subsidiary, or a custodian, receiver,
trustee, assignee for the benefit of creditors (or other similar official) shall
be appointed to take possession, custody, or control of the properties of the
Borrower or any Restricted Subsidiary, unless such petition or appointment is
set aside or withdrawn or ceases to be in effect within 60 days after the date
of said filing or appointment; or
(g) The Subsidiary Guaranty shall fail to remain in full force or
effect or any action shall be taken to discontinue or assist the invalidity or
unenforceability of the Subsidiary Guaranty, or any Restricted Subsidiary shall
fail to comply with any of the terms or provisions of the Subsidiary Guaranty,
or any Restricted Subsidiary denies that it has any further liability under the
Subsidiary Guaranty, or gives notice to such effect.
(h) The occurrence of any "Default" as set forth in Article VII of the
First Chicago Credit Agreement (other than those Defaults which are included in
paragraphs (b) or (c) above.
Upon the occurrence of any such Event of Default, the Bank may, in its
sole discretion, by notice to the Borrower, declare all amounts payable by the
Borrower under this Agreement and/or under the Revolving Credit Note to be
forthwith due and payable, and the same shall thereupon immediately become due
and payable without demand, presentment, protest or further notice of any kind,
all of which are hereby expressly waived by the Borrower.
No remedy conferred on or reserved to the Bank in this Agreement is
intended to be exclusive of any other available remedy or remedies, but each and
every such remedy shall be cumulative and shall be in addition to every other
remedy given under this Agreement or now or hereafter existing at law or in
equity or by statute. No delay or omission to exercise any right or power
accruing upon any default, omission or failure of performance hereunder shall
impair any such right or power or shall be construed to be a waiver thereof, but
any such right or power may be exercised from time to time and as often as may
be deemed expedient. In order to exercise any remedy reserved to the Bank in
this Agreement, it shall not be necessary to give any notice, other than such
notice as may be herein expressly required. If any provision contained in this
Agreement shall be breached by the Borrower and thereafter duly waived by the
Bank, such waiver shall be limited to the particular breach so waived and shall
not be deemed to waive any other breach hereunder. No waiver, amendment, release
or modification of this Agreement shall be established by conduct, custom or
course of dealing, but solely by an instrument in writing duly executed by the
parties thereunto duly authorized by this Agreement. Any waiver, amendment,
release or modification executed by the Borrower, the Agent and the Lenders
under the First Chicago Credit Agreement that waives, amends, releases or
modifies any of the representations and warranties, covenants, or Defaults
incorporated in this Agreement from the First Chicago Credit Agreement shall not
be effective as a waiver, amendment, release, or modification of such provision
as incorporated in this Agreement unless the Bank expressly consents thereto in
a writing duly executed by the Bank.
6. SELECTED DEFINITIONS
CAPITALIZED TERMS USED HEREIN WITHOUT DEFINITION AND WHICH ARE DEFINED IN THE
FIRST CHICAGO CREDIT AGREEMENT SHALL HAVE THE SAME MEANINGS HEREIN AS IN THE
FIRST CHICAGO CREDIT AGREEMENT.
"ADVANCE" shall mean any advance of funds under the Commitment pursuant to the
terms of this Agreement. An Advance may be either a "Base Rate Advance" or a
"LIBOR Advance".
"APPLICABLE MARGIN" shall mean (i) during any Level 1 Period, 0.625% per annum
with respect to LIBOR Advances and 0.00% with respect to Base Rate Advances,
(ii) during any Level 2 Period, 0.75% per annum with respect to LIBOR Advances
and 0.00% with respect to Base Rate Advances, (iii) during any Level 3 Period,
1.0% per annum with respect to LIBOR Advances and 0.00% with respect to Base
Rate Advances and (iv) during any Level 4 Period, 1.50% per annum with respect
to LIBOR Advances and 0.50% with respect to Base Rate Advances, PROVIDED that
all adjustments to the Applicable Margin shall be effective commencing on the
fifth Business DAY after (x) the delivery of financial statements showing the
required ratio for the applicable Level or (y) the Bank becomes aware that the
Borrower or any Subsidiary has incurred additional Indebtedness which would
affect the calculation of the Debt to Cash Flow from Operations Ratio, and
PROVIDED FURTHER that in the event that the Borrower shall at any time fail to
furnish to the Bank the financial statements required to be delivered pursuant
to Sections 6.1(a) and (b) of the First Chicago Credit Agreement or fail to
notify the Bank, pursuant to Section 6.1(j) of the First Chicago Credit
Agreement, of the incurrence of any such Indebtedness, the maximum Applicable
Margin shall apply until such time as such financial statements are so delivered
or the Bank is notified of the incurrence of such Indebtedness, as the case may
be. From the closing date to the next determination date in accordance with this
definition, the Applicable Margin shall be 0.75% per annum.
"BASE RATE" shall mean the higher of (i) the Prime Rate and (ii) the Federal
Funds Effective Rate plus 0.50% per annum. Each change in any interest rate
provided for herein based upon the Base Rate resulting from a change in the Base
Rate shall take effect at the time of such change in the Base Rate.
"BASE RATE ADVANCE" shall mean any Advance that bears interest at the Base Rate.
"BORROWING DATE" shall mean a date on which an Advance is made hereunder.
"COMMITMENT" shall mean the commitment of the Bank to make Advances to the
Borrower in a principal amount up to $25,000,000 on the terms and conditions set
forth in this Agreement.
"DEFAULT RATE" shall mean for all outstanding LIBOR Advances until the end of
the applicable Interest Period, 2% per annum above the then existing interest
rate for such Interest Period, and thereafter and with respect to Base Rate
Advances, the Base Rate, PLUS the Applicable Margin, PLUS 2% per annum.
"EVENT OF DEFAULT" shall mean those events set forth under the heading "Events
of Default" hereinabove.
"FIRST CHICAGO CREDIT AGREEMENT" shall mean the Revolving Credit Agreement dated
as of July 22, 1996 among Seitel, Inc., the Lenders Party thereto, and The First
National Bank of Chicago, as Agent, as such Agreement has been amended,
restated, supplemented or otherwise modified as of the date hereof.
"INTEREST PERIOD" shall mean, with respect to any LIBOR Advance, such period
commencing on the date such Advance is made or, in the case of each subsequent,
successive Interest Period, the last day of the next preceding Interest Period,
and ending on the numerically corresponding day in the first, second, or third
calendar month thereafter, as the Borrower may select as provided in SECTION
1(B) hereof; PROVIDED, that: (i) the first day of an Interest Period must be a
Business Day, (ii) any Interest Period that would otherwise end on a day that is
not a Business Day shall be extended to the next succeeding Business Day, unless
such Business Day falls in the next calendar month, in which case the Interest
Period shall end on the next preceding Business Day, (iii) any Interest Period
which begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of an
Interest Period) shall end on the last Business Day of a calendar month, and
(iv) no Interest Period shall extend beyond the Termination Date.
"LEVEL 1 PERIOD" shall mean any period during which the Debt to Cash Flow from
Operations Ratio measured as of the end of the most recent fiscal quarter was
less than 1.0 to 1.0.
"LEVEL 2 PERIOD" shall mean any period which does not qualify as a Level 1
Period during which the Debt to Cash Flow from Operations Ratio measured as of
the end of the most recent fiscal quarter was less than 2.0 to 1.0.
"LEVEL 3 PERIOD" shall mean any period which does not qualify as a Level 1
Period or a Level 2 Period during which the Debt to Cash Flow from Operations
Ratio measured as of the end of the most recent fiscal quarter was less than 2.5
to 1.0.
"LEVEL 4 PERIOD" shall mean any period which does not qualify as a Level 1
Period, a Level 2 Period or a Level 3 Period.
"LIBOR" shall mean the rate per annum for deposits in U.S. dollars of amounts
equal or comparable to the principal amount of such advance offered for a term
comparable to such interest period, which rate appears on the Telerate Page 3750
as of 11:00 A.M. (London, England time), two (2) business days prior to the
beginning of such interest period; PROVIDED, that if no such offered rates
appear on such page, the rate used for such interest period will be the
arithmetic average (rounded upwards, if necessary, to the next higher 1/100th of
1%) of rates offered by the Bank to not less than two major banks in New York,
New York at approximately 10:00 A.M. (Atlanta, Georgia time) two (2) business
days prior to the beginning of such interest period for deposits in U.S. dollars
in the London interbank market for a period comparable to the principal amount
of such advance, as the case may be, DIVIDED BY a number equal to 1.00 MINUS the
LIBOR Reserve Percentage. The rate so determined in accordance herewith shall be
rounded upwards to the nearest multiple of 1/100th of 1%. TELERATE PAGE 3750
shall mean the display designated as "Page 3750" on the Dow Xxxxx Market Service
(or such other page as may replace Page 3750 on that service or another service
as may be nominated by the British Bankers' Association as the information
vendor for the purpose of displaying British Bankers' Association Interest
Settlement Rates for Dollars). LIBOR RESERVE PERCENTAGE shall mean the reserve
percentage applicable to such interest period (or if more than one such
percentage shall be so applicable, the daily average of such percentages for
those days in such interest period during which any such percentage shall be so
applicable) under regulations issued from time to time by the Board of Governors
of the Federal Reserve System (or any successor) for determining the maximum
reserve requirement (including, without limitation, any emergency, supplemental,
or other marginal reserve requirement) for the Bank with respect to liabilities
or assets consisting of or including "eurocurrency liabilities" (as defined in
Regulation D of the Board of Governors of the Federal Reserve System, as in
effect from time to time) having a term equal to such interest period.
"LIBOR ADVANCE" shall mean any Advance that bears interest based on a rate
determined by reference to LIBOR.
"LOAN DOCUMENTS" shall mean this Agreement, the Revolving Credit Note, the
Subsidiary Guaranty, and certificates and other documents delivered in
connection therewith, either as originally executed or as may be amended,
supplemented or otherwise modified.
"OBLIGATIONS" shall mean all unpaid principal of and accrued and unpaid interest
on the Revolving Credit Note, all accrued and unpaid fees and all expenses,
reimbursements indemnities and other obligations of the Borrower to the Bank
hereunder and under the Revolving Credit Note.
"POTENTIAL DEFAULT" shall mean any event which, with the passage of time or the
giving of notice or both, would constitute an Event of Default.
"PRIME RATE" shall mean the rate of interest per annum designated from time to
time by the Bank at its principal office in Atlanta, Georgia to be its prime
rate, which rate of interest may not be the lowest rate available to customers
of the Bank, with any change in the Prime Rate to be effective as of the date of
such change.
"REVOLVING CREDIT NOTE" shall mean the promissory note dated the date hereof in
the principal amount of $25,000,000 executed by the Borrower and payable to the
order to the Bank, either as originally executed or as it may be amended,
supplemented or otherwise modified.
"SUBSIDIARY GUARANTY" shall mean the guaranty agreement substantially in the
form of Exhibit "J" of the First Chicago Credit Agreement executed and delivered
by the existing Restricted Subsidiaries in favor of the Bank.
7. MISCELLANEOUS
(a) SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure to the
benefit of the Borrower and the Bank, and their respective successors and
assigns; PROVIDED, that the Borrower shall have no right to assign its rights or
obligations hereunder to any Person. The Bank may assign its rights and delegate
its obligations under this Agreement and the other Loan Documents and further
may assign all or any part of its Commitment and any Advances under the
Revolving Credit Note, or any other interest herein or in any other Loan
Document to other financial institutions and accredited investors, with the
prior written consent of the Borrower (which consent will not be unreasonably
withheld); PROVIDED, that such consent shall not be required if a Potential
Default or Event of Default exists at the time of such assignment. Any assignee
shall have, to the extent of such assignment unless otherwise provided therein,
the same rights, obligations and benefits as it would have if it were the Bank
hereunder and under the other Loan Documents. The Bank may sell participations
in the Commitment and/or any Advances under the Revolving Credit Note to other
financial institutions and accredited investors without the consent of the
Borrower; PROVIDED, that no participant shall have any right to deal directly
with the Borrower and no participant shall have any voting rights under this
Agreement except with respect to any proposed increase in the Commitment, any
extension of the Termination Date, any decrease in the interest rate margin or
any release of any guarantor or any collateral.
(b) ENTIRE AGREEMENT. This Agreement, the Revolving Credit Note, and
the other Loan Documents embody the final, entire agreement among the parties
hereto and supersede any and all prior commitments, agreements, representations,
and understandings, whether written or oral, relating to the subject matter
hereof and may not be contradicted or varied by evidence of prior,
contemporaneous, or subsequent oral agreements or discussions of the parties
hereto. There are no oral agreements among the parties hereto.
(c) AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement, the Revolving Credit Note, or any other Loan Document to which the
Borrower is a party, nor any consent to any departure by the Borrower therefrom,
shall in any event be effective unless the same shall be agreed or consented to
by the Bank and the Borrower, and each such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
(d) NOTICES. All notices and other communications provided for in this
Agreement and the other Loan Documents shall be given or made by telecopy, or in
writing and telecopied, mailed by certified mail return receipt requested, or
delivered to the intended recipient at the following addresses:
If to Bank: SunTrust Bank, Atlanta
00 Xxxx Xxxxx, X.X./00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Mr. Xxxx Xxxxxx
First Vice President
Tel: (000) 000-0000
Fax: (000) 000-0000
If to Borrower: Seitel, Inc.
00 Xxxxx Xxxxxx Xxxx, 0xx Xxxxx X.
Xxxxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxxxx
Senior Vice President of
Finance, Chief Financial
Officer, Treasurer &
Secretary
Tel: (000) 000-0000
Fax: (000) 000-0000
or, as to any party at such other address as shall be designated by such party
in a notice to each other party given in accordance with this paragraph. Except
as otherwise provided in this Agreement, all such communications shall be deemed
to have been duly given when transmitted by telecopy, subject to telephone
confirmation of receipt, or when personally delivered or, in the case of a
mailed notice, when duly deposited in the mails, in each case given or addressed
as aforesaid.
(e) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.
(f) SEVERABILITY. Any provision of this Agreement held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Agreement and the effect thereof shall be
confined to the provision held to be invalid or illegal.
(g) CONSTRUCTION. The Borrower and the Lender acknowledge that each of
them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement and the other Loan Documents
with its legal counsel and that this Agreement and the other Loan Documents
shall be construed as if jointly drafted by the parties hereto.
(h) CONFIDENTIALITY. The Bank agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to its Affiliates, (ii) to legal counsel,
accountants, and other professional advisors to the Bank or to any assignee or
participant, (iii) to regulatory officials, (iv) to any Person required by law,
regulation or legal process and (v) to any participant or assignee which agrees
to be bound by this paragraph.
(i) MAXIMUM RATE. It is the intention of the parties hereto to comply
with all applicable usury laws; accordingly, it is agreed that notwithstanding
any provision to the contrary herein and in the Revolving Credit Note, or in any
of the documents securing payment thereof or other wise relating hereto, no such
provision shall require the payment or permit the collection of interest in
excess of the highest rate allowed under applicable law (the "Maximum Rate"). If
any excess of interest in such respect is provided for, or shall be adjudicated
to be so provided for, herein or in the Revolving Credit Note or in any of the
documents securing payment thereof or otherwise relating hereto, then in such
event:
(i) the provisions of this paragraph shall govern and
control,
(ii) neither the Borrower, the Restricted Subsidiaries, nor
their heirs, legal representatives, successors or assigns nor any
party liable for the payment on the Advances, shall be obligated to
pay the amount of interest to the extent that it is in excess of the
Maximum Rate,
(iii) any such excess with respect to any Advance which may
have been collected shall, at the election of the Bank, be either
applied as a credit against the then unpaid principal amount of
Advances or refunded to the Borrower, and
(iv) the provisions hereof and of the Revolving Credit Note
and any documents securing payment thereof shall be automatically
reformed so that the effective rate of interest shall be reduced to
the Maximum Rate. For the purpose of determining the Maximum Rate, all
interest payments with respect hereto shall be amortized, prorated and
spread throughout the full term of this Agreement so that the
effective rate of interest charged hereunder is uniform throughout the
term hereof.
(j) GOVERNING LAW; JURISDICTION. (i) THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF GEORGIA (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES
THEREOF).
(ii) THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL COURT SITTING
IN THE NORTHERN DISTRICT OF GEORGIA OR IN ANY GEORGIA STATE COURT
SITTING IN XXXXXX COUNTY, GEORGIA, IN ANY ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT AND/OR THE REVOLVING CREDIT NOTE,
AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT
OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER
HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
SUCH COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN
SHALL LIMIT THE RIGHT OF THE BANK TO BRING PROCEEDINGS AGAINST THE
BORROWER IN THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL
PROCEEDING BY THE BORROWER AGAINST BANK INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH THIS AGREEMENT AND/OR THE REVOLVING CREDIT NOTE SHALL
BE BROUGHT ONLY IN A FEDERAL COURT SITTING IN THE NORTHERN DISTRICT OF
GEORGIA OR IN A GEORGIA STATE COURT SITTING IN XXXXXX COUNTY, GEORGIA.
(k) WAIVER OF JURY TRIAL. THE BORROWER AND THE BANK EACH HEREBY WAIVE
TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT
OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT AND/OR THE REVOLVING CREDIT
NOTE.
IN WITNESS WHEREOF, the Borrower and the Bank have caused this
Agreement to be executed and delivered under seal (of the Borrower only) by
their respective duly authorized officers as of the date first above written.
SEITEL, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President
Attest:/s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Assistant Secretary
[CORPORATE SEAL]
SUNTRUST BANK, ATLANTA
By:/s/ X. XxXxxxxxx Xxxxxx, III
----------------------------------------
Name: X. XxXxxxxxx Xxxxxx, III
Title: Group Vice President
By:/s/ Xxxxx X. Edge
----------------------------------------
Name: Xxxxx X. Edge
Title: Vice President
REVOLVING CREDIT NOTE
$25,000,000.00 December 11, 1998
FOR VALUE RECEIVED, the undersigned SEITEL, INC., a Delaware
corporation ("MAKER"), hereby promises to pay to the order of SUNTRUST BANK,
ATLANTA ("PAYEE"), at its offices at 00 Xxxx Xxxxx, X.X., Xxxxxxx, Xxxxxxx, in
Dollars, the principal sum of TWENTY FIVE MILLION DOLLARS ($25,000,000), or so
much thereof as may be advanced and outstanding hereunder and under the Credit
Agreement (as hereinafter defined), together with interest on the outstanding
principal balance from day to day remaining, at varying rates per annum as set
forth in the Credit Agreement (as hereinafter defined).
Interest on the indebtedness evidenced by this Revolving Credit Note
shall be computed on the basis of a year of 360 days and the actual number of
days elapsed (including the first day but excluding the last day).
All principal of and accrued and unpaid interest on this Revolving
Credit Note shall be due and payable as specified in the hereafter defined
Credit Agreement. Upon the occurrence of a Potential Default or an Event of
Default, interest may accrue, at the Payee's option, at the Default Rate.
This Revolving Credit Note is the Revolving Credit Note provided for
in that certain Revolving Credit Agreement dated as of December 11, 1998 between
Maker and the Payee (as the same may be amended from time to time herein, the
"CREDIT AGREEMENT"). Capitalized terms not otherwise defined herein shall have
the same meaning as in the Credit Agreement. Reference is hereby made to the
Credit Agreement for provisions affecting this Revolving Note, including without
limitation, the terms and conditions under which this Revolving Credit Note may
be prepaid or its maturity date accelerated. This Revolving Credit Note is
guaranteed pursuant to the Subsidiary Guaranty dated the date hereof, all as
more specifically described in the Credit Agreement, and reference is made
thereto for a statement of the terms and provisions thereof.
THIS REVOLVING CREDIT NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF GEORGIA AND THE APPLICABLE LAWS OF THE
UNITED STATES OF AMERICA.
TIME IS OF THE ESSENCE UNDER THIS REVOLVING CREDIT NOTE. In addition
to and in limitation of the foregoing, the Maker further promises to pay all
costs and expenses of collection, including without limitation, reasonable
attorneys' fees, if this Revolving Credit Note is collected by or through an
attorney at law or in bankruptcy or any other judicial proceeding.
Maker expressly waives any presentment, demand, protest, or notice in
connection with this Revolving Credit Note, now or hereafter otherwise required
applicable law.
IN WITNESS WHEREOF, the Maker has caused this Revolving Credit Note to
be executed and delivered under seal by its duly authorized officers as of the
date first above written.
SEITEL, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President
Attested By:/s/ Xxxxxx X. Xxxxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Assistant Secretary
(CORPORATE SEAL)
SUBSIDIARY GUARANTY
THIS SUBSIDIARY GUARANTY (this "Guaranty") is made as of the 11th day
of December, 1998, by SEITEL DATA CORP., SEITEL DELAWARE, INC., SEITEL
MANAGEMENT, INC., SEITEL GEOPHYSICAL, INC., DDD ENERGY, INC., SEITEL GAS &
ENERGY CORP., SEITEL POWER CORP., SEITEL NATURAL GAS, INC., MATRIX GEOPHYSICAL,
INC., EXSOL, INC., DATATEL, INC., SEITEL OFFSHORE CORP., all Delaware
corporations, GEO-BANK, INC. and ALTERNATIVE COMMUNICATION ENTERPRISES, INC.,
each a Texas corporation, SEITEL INTERNATIONAL, INC. and AFRICAN GEOPHYSICAL,
INC., each a Cayman Islands corporation, and SEITEL DATA LTD., a Texas limited
partnership (collectively, the "SUBSIDIARY GUARANTORS") in favor of SunTrust
Bank, Atlanta, and its successors and permitted assigns (the "BANK"), under the
Credit Agreement referred to below.
W I T N E S S E T H:
WHEREAS, Seitel, Inc., a Delaware corporation (the "PRINCIPAL"), and
the Bank have entered into the Revolving Credit Agreement dated the date hereof
(as same may be amended or modified from time to time, the "CREDIT AGREEMENT"),
providing, subject to the terms and conditions thereof, for extensions of credit
to be made by the Bank to the Principal;
WHEREAS, it is a condition precedent to the Bank establishing the
Commitment and making Advances under the Credit Agreement and the Revolving
Credit Note that each of the Subsidiary Guarantors execute and deliver this
Guaranty, whereby each of the Subsidiary Guarantors shall guarantee the payment
when due, subject to Section 9 hereof, of all principal, interest and other
Obligations that shall be at any time payable by the Principal under the Credit
Agreement and the Revolving Credit Note; and
WHEREAS, in consideration of the financial and other support that the
Principal has provided, and such financial and other support as the Principal
may in the future provide, to the Subsidiary Guarantors, and in order to induce
the Bank to establish the Commitment and to make Advances to the Principal under
the Credit Agreement and the Revolving Credit Note, each of the Subsidiary
Guarantors is willing to guarantee the Obligations of the Principal under the
Credit Agreement and the Revolving Credit Note;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS. Terms defined in the Credit Agreement and not
otherwise defined herein have, as used herein, the respective meanings provided
for therein.
SECTION 2. REPRESENTATIONS AND WARRANTIES. Each of the Subsidiary
Guarantors represents and warrants (which representations and warranties shall
be deemed to have been renewed upon each Borrowing Date) that:
(a) such Subsidiary Guarantor (i) is a corporation or a
partnership duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization;
(ii) is duly qualified as a foreign corporation or partnership and is
in good standing in each jurisdiction in which such qualification is
required by law, other than those jurisdictions as to which the
failure to be so qualified or in good standing count not, individually
or in the aggregate, reasonably be expected to have a Material Adverse
Effect; and (iii) has the corporate or partnership power and authority
to own or hold under lease the properties it purports to own or hold
under lease, to transact the business it transacts and proposes to
transact, to execute and deliver this Guaranty and to perform the
provisions hereof;
(b) the execution and delivery of this Guaranty and the
performance by such Subsidiary Guarantor of its obligations hereunder
have been duly authorized by all necessary corporate or partnership
action and this Guaranty constitutes a legal, valid and binding
obligation of such Subsidiary Guarantor enforceable against it in
accordance with its terms, except as such enforceability may be
limited by (i) applicable bankruptcy, insolvency, reorganization,
moratorium or other similar xxxx affecting the enforcement of
creditors' rights generally and (ii) general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or a law);
(c) the execution, delivery and performance by such
Subsidiary Guarantor of this Guaranty will not (i) contravene, result
in any breach of, or constitute a default under, or result in the
creation of any Lien in respect of any Property of the Borrower or any
Restricted Subsidiary under, any indenture, mortgage, deed of trust,
loan, purchase or credit agreement, lease, corporate charter or
by-laws, partnership agreement or other significant governing
document, or any other agreement or instrument to which the Borrower
or any Restricted Subsidiary is bound or by which the Borrower or any
Restricted Subsidiary or any of their respective properties may be
bound or affected, (ii) conflict with or result in a breach of any of
the terms, conditions or provisions of any order, judgment, decree, or
ruling of any court, arbitrator or Governmental Authority applicable
to the Borrower or any Restricted Subsidiary or (iii) violate any
provision of any statute or other rule or regulation of any
Governmental Authority applicable to the Borrower or any Restricted
Subsidiary;
(d) after giving effect to the transactions contemplated by
the Credit Agreement and this Guaranty and as of the date of its
execution and delivery of this Guaranty (i) the fair salable value of
the assets of such Subsidiary Guarantor, taken as a whole, exceeds its
liabilities, taken as a whole, (ii) such Subsidiary Guarantor is able
to pay and discharge all of its debts (including, without limitation,
its current liabilities) as they become due; (iii) such Subsidiary
Guarantor will not be insolvent and will not be engaged in any
business or transaction for which it has unreasonably small assets or
capital and (iv) such Subsidiary Guarantor has no intent to hinder,
delay or defraud any entity to which it is, or will become, indebted,
or to incur debts that would be beyond its ability to pay as they
mature.
SECTION 3. THE GUARANTY. Subject to Section 9 hereof, each of the
Subsidiary Guarantors hereby unconditionally guarantees the full and punctual
payment (whether at stated maturity, upon acceleration or otherwise) of the
principal of and interest on all Advances, and the full and punctual payment of
all other amounts payable by the Principal under the Credit Agreement,
including, without limitation, the Obligations (all of the foregoing, subject to
the provisions of Section 9 hereof, being referred to collectively as the
"GUARANTEED OBLIGATIONS"). Upon failure by the Principal to pay punctually any
such amount, each of the Subsidiary Guarantors agrees that it shall forthwith on
demand pay the amount not so paid at the place and in the manner specified in
the Credit Agreement.
SECTION 4. GUARANTY UNCONDITIONAL. Subject to Section 9 hereof, the
obligations of each of the Subsidiary Guarantors hereunder shall be
unconditional and absolute and, without limiting the generality of the
foregoing, shall not be released, discharged or otherwise affected by:
(i) any extension, renewal, settlement, compromise, waiver
or release in respect of any obligation of the Principal under the
Credit Agreement or any other Loan Document, by operation of law or
otherwise or any obligation of any other guarantor of any of the
Obligations;
(ii) any modification or amendment of or supplement to the
Credit Agreement or any other Loan Document;
(iii) any release, nonperfection or invalidity of any direct
or indirect security for any obligation of the Principal under the
Credit Agreement, any other Loan Document, or any obligations of any
other guarantor of any of the Obligations;
(iv) any change in the corporate or partnership existence,
structure or ownership of the Principal or any other guarantor of any
of the Obligations, or any insolvency, bankruptcy, reorganization or
other similar proceeding affecting the Principal, or any other
guarantor of the Obligations, or its assets or any resulting release
or discharge of any obligation of the Principal, or any other
guarantor of any of the Obligations;
(v) the existence of any claim, setoff or other rights which
the Subsidiary Guarantors may have at any time against the Principal,
any other guarantor of any of the Obligations, the Bank or any other
Person, whether in connection herewith or any unrelated transactions;
(vi) any invalidity or unenforceability relating to or
against the Principal or any other guarantor of any of the
Obligations, for any reason related to the Credit Agreement, any other
Loan Document, or any provision of applicable law or regulation
purporting to prohibit the payment by the Principal, or any other
guarantor of the Obligations, of the principal of or interest on any
Advance or any other amount payable by the Principal under the Credit
Agreement or any other Loan Document; or
(vii) any other act or omission to act or delay of any kind
by the Principal, any other guarantor of the Obligations, the Bank or
any other Person or any other circumstance whatsoever which might, but
for the provisions of this Section, constitute a legal or equitable
discharge of any Subsidiary Guarantor's obligations hereunder.
SECTION 5. DISCHARGE ONLY UPON PAYMENT IN FULL; REINSTATEMENT IN
CERTAIN CIRCUMSTANCES. Each of the Subsidiary Guarantors' obligations hereunder
shall remain in full force and effect until all Guaranteed Obligations shall
have been paid in full and the Commitment under the Credit Agreement shall have
terminated. If at any time any payment of the principal of or interest on any
Advance or any other amount payable by the Principal or any other party under
the Credit Agreement or any other Loan Document is rescinded or must be
otherwise restored or returned upon the insolvency, bankruptcy or reorganization
of the Principal or otherwise, each of the Subsidiary Guarantors' obligations
hereunder with respect to such payment shall be reinstated as though such
payment had been due but not made at such time.
SECTION 6. WAIVER OF NOTICE. Each of the Subsidiary Guarantors
irrevocably waives acceptance hereof, presentment, demand, protest and, to the
fullest extent permitted by law, any notice not provided for herein, as well as
any requirement that at any time any action be taken by any Person against the
Principal, any other guarantor of the Obligations, or any other Person.
SECTION 7. SUBROGATION. Each of the Subsidiary Guarantors hereby
agrees not to assert any right, claim or cause of action, including, without
limitation, a claim for subrogation, reimbursement, indemnification or
otherwise, against the Principal arising out of or by reason of this Guaranty or
the obligations hereunder, including, without limitation, the payment or
securing or purchasing of any of the Obligations by any of the Subsidiary
Guarantors unless and until the Guaranteed Obligations are paid in full and any
commitment to lend under the Credit Agreement and other Loan Documents is
terminated.
SECTION 8. STAY OF ACCELERATION. If acceleration of the time for
payment of any amount payable by the Principal under the Credit Agreement or any
other Loan Document is stayed upon the insolvency, bankruptcy or reorganization
of the Principal, all such amounts otherwise subject to acceleration under the
terms of the Credit Agreement or any other Loan Document shall nonetheless be
payable by each of the Subsidiary Guarantors hereunder forthwith on demand by
the Bank.
SECTION 9. LIMITATION ON OBLIGATIONS. (a) It is the intention of each of
the Subsidiary Guarantors and the Bank that each of the Subsidiary Guarantor's
obligations hereunder shall be in, but not in excess of, as of any date, the
greater of the following (such greater amount determined hereunder being the
relevant Subsidiary Guarantor's "Maximum Liability"): (i) the aggregate amount
of all monies received by the Subsidiary Guarantor from the Principal after the
date hereof (whether by loan, capital infusion or other means), or (ii) the
maximum amount (such amount being the Subsidiary Guarantor's "Alternative
Limitation") not subject to avoidance under Title 11 of the United States Code,
as same may be amended from time to time, or any applicable state law
(collectively, the "Bankruptcy Code"). To that end, but as to the Alternative
Limitation of the Subsidiary Guarantors, only to the extent such obligations
would otherwise be subject to avoidance under the Bankruptcy Code if the
Subsidiary Guarantor is not deemed to have received valuable consideration, fair
value or reasonably equivalent value for its obligations hereunder, any
Subsidiary Guarantor's obligations hereunder shall be reduced to that amount
which, after giving effect thereto, would not render such Subsidiary Guarantor
insolvent, or leave such Subsidiary Guarantor with an unreasonably small capital
to conduct its business, or cause such Subsidiary Guarantor to have incurred
debts (or intended to have incurred debts) beyond its ability to pay such debts
as they mature, at the time such obligations are deemed to have been incurred
under the Bankruptcy Code. As used herein, the terms "insolvent" and
"unreasonably small capital" shall likewise be determined in accordance with the
Bankruptcy Code. This Section 9(a) with respect to the Alternative Limitation of
the Subsidiary Guarantor is intended solely to preserve the rights of the Bank
hereunder to the maximum extent not subject to avoidance under the Bankruptcy
Code, and neither the Subsidiary Guarantor nor any other person or entity shall
have any right or claim under this Section 9(a) with respect to the Alternative
Limitation, except to the extent necessary so that the obligations of the
Subsidiary Guarantor hereunder shall not be rendered voidable under the
Bankruptcy Code.
(b) Each of the Subsidiary Guarantors agrees that the
Guaranteed Obligations may at any time and from time-to-time exceed
the Maximum Liability of each Subsidiary Guarantor, and may exceed the
aggregate Maximum Liability of all other Subsidiary Guarantors,
without impairing this Guaranty or affecting the rights and remedies
of the Bank hereunder. Nothing in this Section 9(b) shall be construed
to increase any Subsidiary Guarantor's obligations hereunder beyond
its Maximum Liability.
(c) In the event any Subsidiary Guarantor (a "Paying
Subsidiary Guarantor") shall make any payment or payments under this
Guaranty or shall suffer any loss as a result of any realization upon
any collateral granted by it to secure its obligations under this
Guaranty, each other Subsidiary Guarantor (each a "Non-Paying
Subsidiary Guarantor") shall contribute to such Paying Subsidiary
Guarantor an amount equal to such Non-Paying Subsidiary Guarantor's
"Pro Rata Share" of such payment or payments made, or losses suffered,
by such Paying Subsidiary Guarantor. For the purposes hereof, each
Non-Paying Subsidiary Guarantor's "Pro Rata Share" with respect to any
such payment or loss by a Paying Subsidiary Guarantor shall be
determined as of the date on which such payment or loss was made by
reference to the ratio of (i) such Non-Paying Subsidiary Guarantor's
Maximum Liability as of such date (without giving effect to any right
to receive, or obligation to make, any contribution hereunder) to (ii)
the aggregate Maximum Liability of all Subsidiary Guarantors hereunder
(including such Paying Subsidiary Guarantor) as of such date (without
giving effect to any right to receive, or obligation to make, any
contribution hereunder). Nothing in this Section 9(c) shall affect any
Subsidiary Guarantor's several liability for the entire amount of the
Guaranteed Obligations (up to such Subsidiary Guarantor's Maximum
Liability). Each of the Subsidiary Guarantors covenants and agrees
that its right to receive any contribution under this Guaranty from a
Non-Paying Subsidiary Guarantor shall be subordinate and junior in
right of payment to all the Guaranteed Obligations. The provisions of
this Section 9(c) are for the benefit of both the Bank and the
Subsidiary Guarantors and may be enforced by any one, or all of them
in accordance with the terms hereof.
SECTION 10. NOTICES. All notices, requests and other communications to
any party hereunder shall be given or made by telecopier or other writing and
telecopied, or mailed or delivered to the intended recipient at its address or
telecopier number set forth on the signature pages hereof or such other address
or telecopy number as such party may hereafter specify for such purpose by
notice to the Bank in accordance with the provisions of paragraph 7(d) of the
Credit Agreement. Except as otherwise provided in this Guaranty, all such
communications shall be deemed to have been duly given when transmitted by
telecopier, or personally delivered or, in the case of a mailed notice sent by
certified mail return-receipt requested, on the date set forth on the receipt
(provided, that any refusal to accept any such notice shall be deemed to be
notice thereof as of the time of any such refusal), in each case given or
addressed as aforesaid.
SECTION 11. NO WAIVERS. No failure or delay by the Bank in exercising
any right, power or privilege hereunder shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege. The
rights and remedies provided in this Guaranty, the Credit Agreement, and the
other Loan Documents shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION 12. SUCCESSORS AND ASSIGNS. This Guaranty is for the benefit
of the Bank and its successors and permitted assigns and in the event of an
assignment of any amounts payable under the Credit Agreement, or the other Loan
Documents, the rights hereunder, to the extent applicable to the indebtedness so
assigned, may be transferred with such indebtedness. This Guaranty shall be
binding upon each of the Subsidiary Guarantors and their respective successors
and permitted assigns.
SECTION 13. CHANGES IN WRITING. Neither this Guaranty nor any
provision hereof may be changed, waived, discharged or terminated orally, but
only in writing signed by each of the Subsidiary Guarantors and the Bank.
SECTION 14. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAW OF THE STATE OF GEORGIA. EACH OF THE SUBSIDIARY GUARANTORS HEREBY SUBMITS TO
THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF GEORGIA AND OF ANY GEORGIA STATE COURT SITTING IN XXXXXX
COUNTY, GEORGIA AND FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR
RELATING TO THIS GUARANTY (INCLUDING, WITHOUT LIMITATION, ANY OF THE OTHER LOAN
DOCUMENTS) OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE SUBSIDIARY
GUARANTORS IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH ANY OF THEM MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE
OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH
PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
EACH OF THE SUBSIDIARY GUARANTORS, AND THE BANK ACCEPTING THIS GUARANTY, HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED
HEREBY TO THE EXTENT PERMITTED BY APPLICABLE LAW.
SECTION 15. AGENT FOR SERVICE OR PROCESS. EACH SUBSIDIARY GUARANTOR
HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT PROCESS SERVED EITHER
PERSONALLY OR BY REGISTERED MAIL SHALL CONSTITUTE, TO THE EXTENT PERMITTED BY
LAW, ADEQUATE SERVICE OF PROCESS IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS GUARANTY, OR ANY ACTION OR PROCEEDING TO EXECUTE OR
OTHERWISE ENFORCE ANY JUDGMENT IN RESPECT OF ANY BREACH HEREUNDER, BROUGHT BY
THE BANK AGAINST SUCH SUBSIDIARY GUARANTOR OR ANY OF ITS PROPERTY. RECEIPT OF
PROCESS SO SERVED SHALL BE CONCLUSIVELY PRESUMED AS EVIDENCED BY A DELIVERY
RECEIPT FURNISHED BY THE UNITED STATES POSTAL SERVICE OR ANY COMMERCIAL DELIVERY
SERVICE. WITHOUT LIMITING THE FOREGOING, SUCH SUBSIDIARY GUARANTOR HEREBY
APPOINTS, IN THE CASE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN THE COURTS OR
IN THE STATE OF GEORGIA:
CT Corporation System
0000 Xxxxxxxxx Xxxxxx, X. X.
Xxxxxxx, Xxxxxxx 00000
TO RECEIVE, FOR IT AND ON ITS BEHALF, SERVICE OR PROCESS. EACH SUBSIDIARY
GUARANTOR SHALL AT ALL TIMES MAINTAIN AN AGENT FOR SERVICE OF PROCESS IN
ATLANTA, GEORGIA AND MAY FROM TIME TO TIME APPOINT SUCCEEDING AGENTS FOR SERVICE
OF PROCESS BY NOTIFYING THE BANK OF SUCH APPOINTMENT, WHICH AGENTS SHALL BE
ATTORNEYS, OFFICERS OR DIRECTORS OF SUCH SUBSIDIARY GUARANTOR, OR CORPORATIONS
WHICH IN THE ORDINARY COURSE OF BUSINESS ACT AS AGENTS FOR SERVICE OF PROCESS.
NOTHING HEREIN SHALL IN ANY WAY BE DEEMED TO LIMIT THE ABILITY OR RIGHT OF THE
BANK TO SERVE ANY WRIT, PROCESS OR SUMMONS IN ANY MANNER PERMITTED BY APPLICABLE
LAW.
SECTION 16. TAXES, ETC. All payments required to be made by any of the
Subsidiary Guarantors hereunder shall be made without setoff or counterclaim and
free and clear of and without deduction or withholding for or on account of, any
present or future taxes, levies, imposts, duties or other charges of whatsoever
nature imposed by any government or any political or taxing authority thereof,
provided, however, that if any of the Subsidiary Guarantors is required by law
to make such deduction or withholding, such Subsidiary Guarantor shall forthwith
pay to the Bank, as applicable, such additional amount as results in the net
amount received by the Bank equaling the full amount which would have been
received by the Bank, had no such deduction or withholding been made.
IN WITNESS WHEREOF, each of the Subsidiary Guarantors has caused this
Guaranty to be duly executed, under seal, by its authorized officer as of the
day and year first above written.
SEITEL DATA CORP.
By:/s/ Xxxxxxx Xxxxx
----------------------------------------
Name: Xxxxxxx Xxxxx
Title: Vice President
SEITEL DELAWARE, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
SEITEL MANAGEMENT, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
SEITEL GEOPHYSICAL, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
DDD ENERGY, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
SEITEL GAS & ENERGY CORP.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
SEITEL POWER CORP.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
SEITEL NATURAL GAS, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
MATRIX GEOPHYSICAL, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
EXSOL, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: Vice President
DATATEL, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: Vice President
SEITEL OFFSHORE CORP.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: Vice President
GEO-BANK, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: Vice President
ALTERNATIVE COMMUNICATION ENTERPRISES, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: Vice President
SEITEL INTERNATIONAL, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: Vice President
AFRICAN GEOPHYSICAL, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: Vice President
SEITEL DATA LTD.
By: SEITEL DELAWARE, INC.
By:/s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: Vice President
