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EXHIBIT 4.03
AMENDMENT NUMBER TWO
TO LOAN AND SECURITY AGREEMENT
THIS AMENDMENT NUMBER TWO TO LOAN AND SECURITY AGREEMENT (this
"Amendment"), dated effective as of September 23, 1999, is entered into by and
among Grant Geophysical, Inc., a Delaware corporation ("Borrower"), Foothill
Capital Corporation, a California corporation ("Foothill") and Xxxxxxx
Associates, L.P., a Delaware limited partnership ("EALP"), in light of the
following:
WHEREAS, Borrower, EALP and Foothill are parties to that certain Loan
and Security Agreement (the "Loan and Security Agreement"), dated as of May 11,
1999, as amended by Amendment Number One to Loan and Security Agreement, dated
to be effective as of August 13, 1999, by and among Borrower, Foothill and EALP;
and
WHEREAS, Borrower has acquired seven seismic vibrator buggies
(collectively, the "Acquired Equipment") in accordance with the terms of the
Loan and Security Agreement and has requested that certain provisions of the
Loan and Security Agreement be amended, so as to provide for the following;
(a) an increase in the principal amount of the FCC Term Loan
to $11,673,500, and provide a revised payment scheduled for the
repayment of the FCC Term Loan; and
(b) the amendment and restatement of the FCC Term Note to
reflect the changes of referenced above.
WHEREAS, subject to the conditions set forth in this Amendment,
Foothill and EALP have agreed to amend the Loan and Security Agreement as set
forth below.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants, conditions, and provisions as hereinafter set forth, the parties
hereto agree as follows:
1. DEFINITIONS. Initially capitalized terms used herein have the
meanings defined in the Loan and Security Agreement unless otherwise defined
herein.
2. AMENDMENTS.
2.01 AMENDMENT TO THE SECTION 1.1 OF THE LOAN AND SECURITY AGREEMENT.
Section 1.1 of the Loan and Security Agreement is hereby amended by adding the
following definition of "Second Amendment to Loan and Security Agreement" to
such section in the appropriate alphabetical order, such definition to read in
its entirety as follows:
""Second Amendment to Loan and Security Agreement" means that
certain Second Amendment to Loan and Security Agreement, dated to be
effective as of September 23, 1999, by and among Borrower, Foothill and
EALP."
AMENDMENT NO.2 - PAGE 1
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2.02 AMENDMENT AND RESTATEMENT OF SECTION 2.3 OF THE LOAN AND SECURITY
AGREEMENT. Effective as of the date hereof, Section 2.3 of the Loan and Security
Agreement is hereby amended and restated in its entirety to read as follows:
"2.3 FCC TERM LOAN.
(a) General. Foothill has agreed to make a term loan (the
"FCC Term Loan") to Borrower in the stated principal amount not to
exceed Eleven Million Six Hundred Seventy-three Thousand Five Hundred
Dollars ($11,673,500.00). The FCC Term Loan shall be repaid in
thirty-two monthly installments, and one final installment, of
principal in the following amounts:
Month Installment Amount
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October 1, 1999 $287,500.00
November 1, 1999, through May 1, 2002 $313,400.00/month
May 11, 2002 The outstanding principal
balance of the FCC Term Loan
Each such principal installment shall be due and payable on the first
day of each month commencing October 1, 1999, and continuing on the
first day of each succeeding month until and including the date on
which the unpaid balance of the FCC Term Loan is paid in full. The
outstanding principal balance and all accrued and unpaid interest under
the FCC Term Loan shall be due and payable upon the termination of this
Agreement, whether by its terms, by prepayment, by acceleration, or
otherwise. Subject to Section 3.6, the unpaid principal balance of the
FCC Term Loan may be prepaid in whole or in part at any time during the
term of this Agreement upon 30 days prior written notice by Borrower to
Foothill, all such prepaid amounts to be applied to the installments
due on the FCC Term Loan in the inverse order of their maturity. All
amounts outstanding under the FCC Term Loan shall constitute
Obligations.
(b) Prepayment Upon Disposition of Eligible Equipment.
Except as otherwise expressly permitted by Section 7.4 of this
Agreement, Borrower shall prepay the FCC Term Loan in an amount equal
to the net proceeds of any disposition of Eligible Equipment,
regardless of whether such disposition is permitted under Section 7.4
of this Agreement (but without approving any such disposition not
otherwise expressly permitted under Section 7.4 of this Agreement). The
mandatory prepayment shall be due and payable immediately upon the
corresponding disposition of Eligible Equipment. Mandatory prepayments
shall be applied to installments under the FCC Term Loan in inverse
order of maturity.
(c) FCC Term Note. The FCC Term Loan shall be evidenced
by that certain Amended and Restated Secured Promissory Note, dated
September 23, 1999, in the original principal amount of $11,673,500.00,
executed by Borrower, payable to the order of Foothill, the form of
which is attached as Exhibit A to the Second Amendment to Loan
AMENDMENT NO.2 - PAGE 2
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and Security Agreement (together with any and all renewals, extensions
and modifications thereof, the "FCC Term Note").
3. CONDITIONS TO EFFECTIVENESS. This Amendment shall become effective
upon fulfillment of the following conditions, in each case to the satisfaction
of Foothill:
(a) a counterpart of this amendment shall be executed by
Borrower and delivered to Foothill;
(b) a counterpart of this Amendment shall be executed by EALP
and delivered to Foothill;
(c) each of AST, GGC and GGII shall reaffirm its obligations
under the applicable Subsidiary Guaranty, pursuant to an instrument in
form and substance satisfactory to Foothill;
(d) Borrower shall execute and deliver to Foothill an amended
and restated secured promissory note in the form attached hereto as
Exhibit A; and
(e) Borrower shall pay all fees and expenses required to be
paid by Borrower pursuant to Section 6.03 of this Amendment.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF BORROWER.
4.01 REPRESENTATIONS AND WARRANTIES OF BORROWER. Borrower hereby
represents and warrants to Foothill as follows:
(a) the execution delivery and performance by Borrower of this
Amendment have been duly authorized by all necessary corporate action
of Borrower and do not and will not require any registration with,
consent or approval of, notice to or action by, any Person in order to
be effective and enforceable;
(b) the execution, delivery and performance by Borrower of
this Amendment will not violate the articles of incorporation, bylaws
or any other agreement to which Borrower is a party or by which the
property of Borrower may be bound;
(c) the Loan and Security Agreement, as amended by this
Amendment, constitutes the legal, valid and binding obligation of
Borrower, enforceable against Borrower in accordance with its terms,
without defense, counterclaim or offset;
(d) the representations and warranties contained in the Loan
and Security Agreement (as amended by this Amendment) and each other
Loan Document are true and correct 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 to an earlier date;
AMENDMENT NO.2 - PAGE 3
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(e) Borrower is in full compliance with all covenants and
agreements contained in the Loan and Security Agreement as amended by
this Amendment and all such covenants and agreements are, and shall
remain, in full force and effect;
(f) an indication of the agent's security interests on
certificates of titles issued with respect to the Acquired Equipment is
not required to perfect the security interests of the Agent in the
Acquired Equipment, and
(g) the security interests of the Agent granted by the Loan
and Security Agreement in the Acquired Equipment constitute perfected,
first-priority security interests in the Acquired Equipment.
4.02 COVENANTS OF BORROWER. Within fifteen days of the date hereof,
Borrower shall, or shall cause each of GGBL, PTGI and SSGI to take the following
actions:
(a) each of GGBL, PTGI and SSGI shall reaffirm their
respective obligations under the applicable Subsidiary Guaranties,
pursuant to an instrument in form and substance satisfactory to
Foothill; and
(b) provide Foothill with evidence satisfactory to Foothill of
the filing of a duly executed and completed "Application for
Registration of Water Well Drilling or Construction Machinery"
(collectively, the "Applications") with the Texas Department of
Transportation with respect to each of the seven pieces of Acquired
Equipment
Upon receipt of the approved copies of the Applications, Borrower promptly shall
forward copies of same to Foothill, and Borrower promptly shall proceed to
purchase the requested plates from the appropriate county tax assessor-collector
in accordance with the requirements of the Applications. The failure of Borrower
to comply with any portion of the requirements of this Section 4.02 shall
constitute an "Event of Default" pursuant to Section 8 of the Loan and Security
Agreement, as amended by this Amendment
5. AGREEMENT OF EALP. EALP hereby joins in this Amendment for the
purpose of consenting to the terms hereof. EALP hereby agrees that all terms,
covenants and provisions of the Loan and Security Agreement and the other Loan
Documents are, and shall remain, in full force and effect, including (without
limitation) the subordination provisions set forth at Section 17.16 of the Loan
and Security Agreement and EALP's guaranty of the Obligations of Borrower (other
than the EALP Term Loan) pursuant to the EALP Guaranty, which EALP Guaranty is
hereby acknowledged and reaffirmed with respect to all Obligations of Borrower
(other than the EALP Term Loan) arising pursuant to the Loan and Security
Agreement and other Loan Documents, as amended by this Amendment.
6. MISCELLANEOUS.
6.01 SU]RVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made herein and in the Loan and Security Agreement shall survive
the execution and
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delivery of this Amendment and no investigation by Foothill or any closing
shall affect the representations and warranties or the right of Foothill to
rely upon them.
6.02 REFERENCE TO LOAN AGREEMENT. The Loan and Security Agreement, as
amended hereby, and all other Loan Documents, whether now or hereafter executed
and delivered, are hereby amended so that any reference to the Loan and Security
Agreement shall mean a reference to the Loan and Security Agreement, as amended
by this Amendment.
6.03 EXPENSES OF FOOTHILL AND WAIVER FEE. In consideration of
Foothill's execution and delivery of this Amendment, Borrower shall pay to
Foothill an amendment fee in the amount of $10,000, which fee shall be earned by
Foothill and shall be due and payable upon the execution by Foothill of a
counterpart of this Amendment. In addition to such waiver fee and as provided in
the Loan and Security Agreement, Borrower agrees to pay on demand all costs and
expenses incurred by Foothill in connection with the preparation, negotiation
and execution of this Amendment including, without limitation, the costs and
fees of Foothill's legal counsel and appraiser, and all costs and expenses
incurred by Foothill in connection with the enforcement or preservation of any
rights under the Loan and Security Agreement, as amended hereby, or any other
Loan Document.
6.04 SEVERABILITY. Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
6.05 SUCCESSORS AND ASSIGNS. This Amendment is binding upon and shall
inure to the benefit of Foothill and Borrower and their respective Successors
and assigns, except Borrower may not assign or transfer any of its rights or
obligations hereunder without the prior written consent of Foothill.
6.06 COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.
6.07 HEADINGS. The headings, captions, and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment.
6.08 SCHEDULE C-1. Notwithstanding the execution of this Amendment,
Schedule C-1 to the Loan and Security Agreement shall not be changed or
modified, and the percentages and limitations set forth in such schedule shall
be applied by the parties to the Loan and Security Agreement without change or
modification as a result of this Amendment.
6.09 APPLICABLE LAW. THIS AMENDMENT AND ALL OTHER LOAN DOCUMENTS
EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE
IN AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS.
AMENDMENT NO.2 - PAGE 5
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6.10 FINAL AGREEMENT. THE LOAN AND SECURITY AGREEMENT, AS AMENDED
HEREBY, AND THE OTHER LOAN DOCUMENTS REPRESENT THE ENTIRE EXPRESSION OF THE
PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF AND THEREOF ON THE DATE THIS
AMENDMENT IS EXECUTED. THE LOAN AND SECURITY AGREEMENT, AS AMENDED HEREBY, MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES. NO MODIFICATION, RESCISSION, WAIVER, RELEASE OR AMENDMENT OF ANY
PROVISION OF THIS AMENDMENT SHALL BE MADE, EXCEPT BY A WRITTEN AGREEMENT SIGNED
BY BORROWER AND FOOTHILL.
6.11 RELEASE. BORROWER HEREBY ACKNOWLEDGES THAT IT HAS NO DEFENSE,
COUNTERCLAIM, OFFSET, CROSS-COMPLAINT, CLAIM OR DEMAND OF ANY KIND OR NATURE
WHATSOEVER THAT CAN BE ASSERTED TO REDUCE OR ELIMINATE ALL OR ANY PART OF ITS
LIABILITY TO REPAY THE OBLIGATIONS (AS DEFINED IN THE LOAN AND SECURITY
AGREEMENT) OR TO SEEK AFFIRMATIVE RELIEF OR DAMAGES OF ANY KIND OR NATURE FROM
FOOTHILL. BORROWER HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER
DISCHARGES FOOTHILL, ITS PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND
ASSIGNS, FROM ALL POSSIBLE CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES,
COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN OR UNKNOWN, ANTICIPATED OR
UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT OR CONDITIONAL, AT
LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS
AMENDMENT IS EXECUTED, WHICH THE BORROWER MAY NOW OR HEREAFTER HAVE AGAINST
FOOTHILL, ITS PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, IF ANY,
AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF CONTRACT, TORT,
VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING FROM ANY OBLIGATIONS
(AS DEFINED IN THE LOAN AGREEMENT), INCLUDING, WITHOUT LIMITATION, ANY
CONTRACTING FOR, CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST
IN EXCESS OF THE MAXIMUM RATE, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE
LOAN AND SECURITY AGREEMENT OR ANY AGREEMENT, DOCUMENT OR INSTRUMENT ENTERED
INTO IN CONNECTION THEREWITH.
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AMENDMENT NO.2 - PAGE 6
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IN WITNESS HEREOF, this Amendment his been executed and delivered as of
the date first set forth above.
GRANT GEOPHYSICAL, INC.
a Delaware corporation
By: /s/ XXXX XXXXXXX
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Xxxx Xxxxxxx
Vice President
FOOTHILL CAPITAL CORPORATION,
a California corporation, as Agent and
as a Lender
By: /s/ XXX XXX
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Name: XXX XXX
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Title: Vice President
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XXXXXXX ASSOCIATES, L.P.
a Delaware limited partnership
By:
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Xxxx X. Xxxxxx,
General Partner
AMENDMENT NO.2 - PAGE 7
