Common use of Loan Restructuring Clause in Contracts

Loan Restructuring. The Parties agree that on the Execution Date the Loans will be consolidated and restructured into a single Restructured Loan obligation in the amount of $43,245,770. The Parties agree that the Restructured Loan will be paid as follows: (a) On the Execution Date, Caspian Services shall make a cash payment via a bank wire to Baiseitov in the amount of $6,000,000 which shall be credited to a reduction of principal due under the Restructured Loan, as of July 31, 2011. Caspian Services may elect to make cash bank wire payment directly to Baiseitov in its discretion may cause its wholly owned subsidiary Caspian Services Group Limited to effect the payment or its part thereof on its behalf; (b) On the Closing Date, Caspian Services shall issue to Baiseitov 90,000,000 of restricted Common Stock at the agreed price of $.12 per share for a total of $10,800,000, which amount will be immediately credited against the principal of the Restructured Loan as if the Common Stock had been delivered on July 31, 2011; (c) On the Closing Date, the balance of the Restructured Loan will be evidenced by the Note in the principal amount of $26,445,770 conforming in all material respects to Exhibit A; (d) The Note will be secured by a first position security interest in the following described assets of Caspian Services and its subsidiaries under the terms of the Security Agreements: (i) Assets and 100% of the shares of Caspian Services Group Limited, a British Virgin Islands company limited by shares; (ii) Assets and 100% of the shares of Caspian Geophysical Limited a British Virgin Islands company limited by shares; (iii) Assets and 100% of the shares of participatory interest in Caspian Services Group LLP a Republic of Kazakhstan registered and domiciled limited liability partnership; (iv) Assets and 100% of the shares of participatory interest in Tat-Arka LLP a Republic of Kazakhstan registered and domiciled limited liability partnership; (v) Assets and shares of common stock representing 80% of the shares issued and outstanding of JSC Kazamorgeophysica a Republic of Kazakhstan registered and domiciled joint stock company; (vi) 50% of the shares of participatory interest in Veritas Caspian LLP a Republic of Kazakhstan registered and domiciled limited liability partnership; (vii) All geophysical equipment of Caspian Services’ subsidiaries, excluding all equipment of Veritas Caspian LLP; (viii) All marine vessels and small size craft fleet of Caspian Services’ subsidiaries; (ix) Cash flows of all Caspian Services’ subsidiaries not under pledge to EBRD, except as required to fulfill obligations as set forth in this Agreement; and (x) Any and all moveable and immoveable assets of Caspian Services subsidiaries not under pledge to EBRD. (e) Baiseitov will have the right to request the interest payments due under the Note be amended to provide for quarterly interest payments from the Issuance Date in lieu of semi-annual payments and Caspian Services will amend the Note to provide for quarterly interest payments if, in the opinion and sole discretion of Caspian Services chief financial officer, such amendment will not adversely affect the ability of Caspian Services to meet its obligations to EBRD Financing Agreements and meet its working capital reserve needs during the remaining term of the Note. (f) Baiseitov shall have the right to convert the unpaid principal and interest due under the Note to restricted common shares of Caspian Services under the terms of Section 4 of the Note. (g) Caspian Services will pay the out of pocket expenses and legal fees of Baiseitov related to the preparation of the transaction documents up to a maximum amount of $100,000. The parties will otherwise be solely responsible for payment of all of their respective costs associated with the transaction contemplated by this Agreement.