Exhibit 10.2
SOVEREIGN BANK — LOAN NO.
17003864
AMENDED AND
RESTATED
PROMISSORY NOTE
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$5,000,000.00
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SEPTEMBER 16, 2009
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FOR VALUE RECEIVED
, TGC INDUSTRIES, INC. , a
Texas corporation (“ Debtor ”)
unconditionally promises to pay to the order of SOVEREIGN
BANK , a Texas state bank (together with its successors and
assigns, “ Lender ”), without setoff, at
its offices at 6060 Sherry Lane, Dallas (Dallas County), TX 75225,
or at such other place as may be designated by Lender, the
principal amount of FIVE MILLION AND NO/100 DOLLARS
($5,000,000.00) , or so much thereof as may be advanced from
time to time in immediately available funds, together with interest
computed daily on the outstanding principal balance hereunder, at
an annual interest rate (the “ Rate ”),
and in accordance with the payment schedule, indicated below.
This AMENDED AND RESTATED PROMISSORY NOTE (this “
Note ”) is executed pursuant to and evidences
the Loans funded and to be funded by Lender under the Revolving
Credit Facility pursuant to that certain AMENDED AND
RESTATED LOAN AND SECURITY AGREEMENT between Debtor and
Lender dated as of even date herewith (as the same may be amended,
supplemented, renewed or extended from time to time, the “
Loan Agreement ”) to which reference is made
for a statement of the collateral, rights and obligations of Debtor
and Lender in relation thereto; but neither this reference to the
Loan Agreement nor any provision thereof shall affect or impair the
absolute and unconditional obligation of Debtor to pay unpaid
principal of and interest on this Note when due. Capitalized
terms not otherwise defined herein shall have the same meanings as
in the Loan Agreement.
1.
Rate . The Rate shall
be the LESSER of: (a) the
MAXIMUM RATE , or (b) the
GREATER of (i) the
PRIME RATE , or (ii)
FIVE PERCENT (5.00%)
. The term
“ Prime Rate ” means a variable rate of
interest per annum equal to the prime rate as published from time
to time in the “ Bonds, Rates & Yields
” table of The Wall Street Journal . If such
prime rate, as so quoted, is split between two or more different
interest rates, then the Prime Rate shall be the highest of such
interest rates. If the prime rate is no longer published in
the “ Bonds, Rates & Yields ” table of
The Wall Street Journal , then the Prime Rate shall be
(i) the rate of interest per annum established from time to
time by Lender and designated as its base or prime rate, which may
not necessarily be the lowest rate charged by Lender and is set by
Lender in its sole discretion, or (ii) if Lender does not
publish or announce a base or prime rate, or does so infrequently
or sporadically, then the Prime Rate shall be determined by
reference to another base rate, prime rate, or similar lending rate
index, generally accepted on a national basis, as selected by
Lender in its sole and absolute discretion. Notwithstanding
any provision of this Note or any other agreement or commitment
between Debtor and Lender, whether written or oral, express or
implied, Lender shall never be entitled to charge, receive, or
collect, nor shall amounts received hereunder be credited so that
Lender shall be paid, as interest a sum greater than interest at
the Maximum Rate. It is the intention of the parties that
this Note, and all instruments securing the payment of this Note or
executed or delivered in connection therewith, shall comply with
applicable law. If Lender ever contracts for, charges,
receives or collects anything of value which is deemed to be
interest under applicable law, and if the occurrence of any
circumstance or contingency, whether acceleration of maturity of
this Note, prepayment of this Note, delay in advancing proceeds of
this Note, or any other event, should cause such interest to exceed
the maximum lawful amount, any amount which exceeds interest at the
Maximum Rate shall be applied to the reduction of the unpaid
principal balance of this Note or any other indebtedness owed to
Lender by Debtor, and if this Note and such other indebtedness are
paid in full, any remaining excess shall be paid to Debtor.
In determining whether the interest exceeds interest at the Maximum
Rate, the total amount of interest shall be spread, prorated and
amortized throughout the entire term of this Note until its payment
in full. The term “ Maximum Rate ”
as used in this Note means the maximum nonusurious rate of interest
per annum permitted by whichever of applicable United States
federal law or Texas law permits the higher interest rate,
including to the extent permitted by applicable law, any amendments
thereof hereafter or any new law hereafter coming into effect to
the extent a higher Maximum Rate is permitted thereby. If at
any time the Rate shall exceed the Maximum Rate, the Rate shall be
automatically limited to the Maximum Rate until the total amount of
interest accrued hereunder equals the amount of interest which
would have accrued if there had been no limitation to the Maximum
Rate. To the extent, if any, that Chapter 303 of the Texas
Finance Code, as amended, (the “ Act ”)
is relevant to Lender for purposes of determining the Maximum Rate,
the parties elect to determine the Maximum Rate under the Act
pursuant to the “weekly ceiling” from time to time in
effect, as referred to and defined in §303.001-303.016 of the
Act; subject,
1
however, to any right Lender
subsequently may have under applicable law to change the method of
determining the Maximum Rate.
2.
Accrual Method . Interest on the Indebtedness
evidenced by this Note shall be computed on the basis of a
THREE HUNDRED SIXTY (360)
day year and
shall accrue on the actual number of days elapsed for any whole or
partial month in which interest is being calculated. In
computing the number of days during which interest accrues, the day
on which funds are initially advanced shall be included regardless
of the time of day such advance is made, and the day on which funds
are repaid shall be included unless repayment is credited prior to
the close of business on the Business Day received as provided
herein.
3.
Rate Change Date . The Rate will change unless
otherwise provided each time and as of the date that the Prime Rate
changes.
4.
Payment Schedule . Except as expressly provided
herein to the contrary, all payments on this Note shall be applied
in the following order of priority: (a) the payment or
reimbursement of any expenses, costs or obligations (other than the
outstanding principal balance hereof and interest hereon) for which
either Debtor shall be obligated or Lender shall be entitled
pursuant to the provisions of this Note or the other Loan
Documents, (b) the payment of accrued but unpaid interest
hereon, and (c) the payment of all or any portion of the
principal balance hereof then outstanding hereunder, in the direct
order of maturity. If an Event of Default exists under any of
the other Loan Documents, then Lender may, at the sole option of
Lender, apply any such payments, at any time and from time to time,
to any of the items specified in clauses (a), (b) or
(c) above without regard to the order of priority otherwise
specified herein and any application to the outstanding principal
balance hereof may be made in either direct or inverse order of
maturity. If any payment of principal or interest on this
Note shall become due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day and such
extension of time shall be included in computing interest in
connection with such payment. The outstanding principal
balance of this Note, plus accrued and unpaid interest
thereon shall be due and payable on the earlier of (i) the
acceleration of the Indebtedness pursuant to the terms of the Loan
Documents; (ii) SEPTEMBER 16, 2010 ; or (iii) such other
date as may be established by a written instrument between Debtor
and Lender, from time to time (the “ Maturity
Date ”). Accrued and unpaid interest on the
outstanding principal balance of this Note shall be due and payable
monthly commencing on OCTOBER
16, 2009 and continuing on the
SAME day of each calendar month
thereafter (or if no such corresponding date, on the
LAST date of such calendar month)
and on the Maturity Date. Debtor may borrow, repay and
reborrow hereunder at any time, up to a maximum aggregate amount
outstanding at any one time equal to the principal amount of this
Note, provided that Debtor is not in default under any provision of
this Note, any other documents executed in connection with this
Note, or an
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