Restructuring Support Agreement, dated as of December 19, 2017, among SAExploration Holdings, Inc., certain subsidiaries of SAExploration Holdings, Inc., the members of management identified therein and the supporting holders identified therein

EX-10.1 2 d502503dex101.htm EX-10.1 EX-10.1

Exhibit 10.1

RESTRUCTURING SUPPORT AGREEMENT

dated as of December 19, 2017

among

SAExploration Holdings, Inc.

SAExploration Sub, Inc.

SAExploration, Inc.

SAExploration Seismic Services (US), LLC

NES, LLC

and

the Supporting Holders Identified Herein

This RESTRUCTURING SUPPORT AGREEMENT (as amended, supplemented, or otherwise modified from time to time, and collectively with all exhibits thereto, including, without limitation, the term sheet (the “Term Sheet”) attached hereto as Annex A, this “Agreement”) is dated as of December 19, 2017, among: (i) SAExploration Holdings, Inc. (“SAE” and collectively with all of its domestic subsidiaries and affiliates, the “Company”) on behalf of itself and the guarantors party to that certain indenture, dated as of July 27, 2016 (the “Second Lien Notes Indenture”) among SAE, as issuer, each of such guarantors party thereto (each, a “Guarantor” and collectively, the “Guarantors”), and Wilmington Savings Fund Society, FSB, as trustee (together, and with its permitted successors and assigns, the “Indenture Trustee”) pursuant to which SAE issued its 10.000% Senior Secured Second Lien Notes due 2019 (the “Second Lien Notes”) and that certain indenture, dated as of July 2, 2014 (the “Stub Notes Indenture”), among SAE, as issuer, each of such guarantors party thereto, and Wilmington Savings Fund Society, FSB, as successor trustee pursuant to which SAE issued its 10.000% Senior Secured Notes due 2019 (the “Stub Notes”, and the holders thereof, the “Stub Holders”) and (ii) the holders of the Second Lien Notes party hereto from time to time in their capacities as such (together with their respective successors and permitted assigns, the “Supporting Holders”). SAE and the Supporting Holders, and any subsequent person or entity that becomes a party hereto in accordance with the terms hereof, are referred to herein as the “Parties” and, each, individually as a “Party.” Capitalized terms, unless otherwise defined in this Agreement, have the meanings used in the Term Sheet.

RECITALS

WHEREAS, the Parties have agreed to a financial restructuring of the Company that will be implemented consistent with the terms and conditions set forth herein and in the Term Sheet (the “Restructuring”);

WHEREAS, this Agreement is the product of arm’s-length, good-faith discussions between the Parties and their respective professional representatives; and

WHEREAS, the Company and the Supporting Holders are prepared to perform their obligations hereunder, subject to the terms and conditions of this Agreement;

NOW, THEREFORE, in consideration of the covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Party, intending to be legally bound hereby, agrees as follows:

AGREEMENT

Section 1. Agreement Effective Date

This Agreement shall be effective and binding with respect to each of the Parties on the date on which (i) SAE and each Guarantor shall have executed and delivered counterpart signature pages of this Agreement and (ii) Supporting Holders representing not less than 85% of the aggregate principal amount of Second Lien Notes outstanding shall have executed and delivered counterpart signature pages of this Agreement to counsel for the Company (such date, the “RSA Effective Date”). The date on which the Restructuring is consummated is referred to herein as “Closing Date.”

Section 2. Commitments Regarding the Restructuring

2.01 Covenants, Acknowledgments and Commitments of the Supporting Holders. Subject to the terms and conditions hereof, and for so long as this Agreement has not been terminated in accordance with the terms hereof, each Supporting Holder (severally and not jointly) agrees to satisfy the following covenants and makes the following acknowledgements and commitments:

(a) to support the Restructuring;

(b) to provide to counsel and investment banker for the Company on a confidential basis a schedule showing the principal amount of Second Lien Notes held by such Supporting Holder (the “Confidential Schedule of Holdings”), which shall not be disclosed by such counsel or investment banker to any third party without such Supporting Holder’s prior written consent;

(c) to assist the Company with the implementation and consummation of the Restructuring and take any and all commercially reasonable and appropriate actions in furtherance of the Restructuring as contemplated under this Agreement, provided that such actions shall be limited to review and negotiation of the applicable Definitive Documents (as defined below), which Definitive Documents shall contain terms and conditions consistent in all material respects with this Agreement, and execution of the same (to the extent any Definitive Documents require execution thereof by such Supporting Holder to implement and consummate the Restructuring in accordance with the terms hereof); provided further that, except as otherwise provided herein, no Supporting Holder shall be obligated to participate in or consummate, as the case may be, the Exchange Offer or any other part of the Restructuring unless and until all of the conditions to effectiveness of the Restructuring (including the Exchange Offer and the Second Lien Consent Solicitation and Stub Notes Consent Solicitation) set forth in the Term Sheet and Definitive Documents shall have been satisfied or waived or will be satisfied or waived contemporaneously with the closing of the Restructuring or have been waived with the prior written consent of the Required Supporting Holders (defined below);

(d) to support the Exchange Offer on the terms and conditions thereof summarized in Annex A hereto and implemented pursuant to the Definitive Documents and, subject to the receipt of the Offering Memorandum (as defined below), to (i) tender its Second Lien Notes for exchange on the first day of the Exchange Offer, in accordance with the terms and conditions set forth in

Annex A; and (ii) not withdraw such tenders and consents, with the understanding that,

among other things, SAE and the Indenture Trustee will, at the appropriate time, enter into a supplemental indenture to supplement the Second Lien Notes Indenture to permit the entry into the Exchange Offer and related matters on the Closing Date in accordance with Annex A and that consents will be irrevocable thereafter, provided that the Supporting Holders shall have no obligation to tender their Second Lien Notes and may withdraw any tenders after the termination of this Agreement pursuant to Section 4.01 and Section 4.02;

(e) not to (i) object to SAE’s implementation and effectuation of the Restructuring on the terms and conditions set forth in this Agreement; (ii) object to or otherwise commence or participate in any proceeding to oppose any of the Restructuring and (iii) directly or indirectly (1) seek, solicit, support, encourage, or vote or cause to be voted (to the extent applicable) all claims with respect to the Second Lien Notes for which such Supporting Holder has voting power for, consent to, or encourage any proposal, offer, dissolution, wind-up, liquidation, reorganization, merger, consolidation, business combination, joint venture, partnership, sale of assets, or restructuring for SAE, other than the Restructuring or (2) take any other action that is inconsistent with, or that would reasonably be expected to delay or obstruct the consummation of the Restructuring;

(f) to acknowledge that, on the Closing Date, SAE’s existing executives identified on Exhibit B will remain in their current positions, subject to the amended and ratified Employment Agreements as described in Exhibit A;

(g) to the extent applicable, in their capacity as (i) parties to that certain Amended and Restated Credit and Security Agreement, dated as of September 22, 2017 (as may be amended or modified from time to time, the “ABL Credit Agreement”), and/or (ii) parties to that certain Term Loan and Security Agreement, dated as of June 29, 2016, as amended by Amendment No. 1 to Term Loan and Security Agreement, dated as of October 24, 2016, as further amended by Amendment No. 2 to Term Loan and Security Agreement, dated as of September 8, 2017 (the “Term Loan Agreement”), to support amending, as applicable, the ABL Credit Agreement and Term Loan Agreement as needed to effectuate the Restructuring;

(h) as shareholders of Common Stock of SAE, to the extent applicable, to support and take action needed to effectuate the Restructuring; and

(i) not pursue, propose, support, or encourage the pursuit, proposal, or support of any other restructuring or reorganization for or the liquidation of the Company or object to, or support any other person’s efforts to oppose or object to, in each case, directly or indirectly, the Restructuring or any of the transactions contemplated herein.

2.02 Obligations of the Company.

(a) Affirmative Covenants. Subject to the terms and conditions hereof, and for so long as this Agreement has not been terminated in accordance with the terms hereof, SAE, on behalf of itself and each Guarantor party to the Second Lien Notes Indenture, as applicable, agrees to satisfy the following covenants and makes the following acknowledgements and commitments:

(i) to support the Restructuring;

(ii) to implement and consummate the Restructuring in a timely manner and take any and all commercially reasonable and appropriate actions in furtherance of the Restructuring, as contemplated under this Agreement;

(iii) to negotiate in good faith the Definitive Documents, which Definitive Documents shall contain terms and conditions consistent in all respects with this Agreement, or as otherwise agreed to by the Required Supporting Holders;

(iv) to take all necessary corporate action to authorize such number of additional shares of Common Stock and Preferred Stock as shall be sufficient to permit the issuance of all shares of Common Stock and Preferred Stock as contemplated by Annex A and to amend the Company’s organizational documents in contemplation of the Restructuring;

(v) use its commercially reasonable efforts to (1) commence the Exchange Offer on the Launch Date and, if not commenced on such date, to commence the Exchange Offer as promptly as possible thereafter, and to conduct the Exchange Offer in accordance with the terms reflected in Annex A and applicable law; and (2) enter into the supplemental indenture to supplement the Second Lien Notes Indenture, as contemplated by Annex A;

(vi) deliver on the Closing Date, or within two (2) business days thereafter, to each existing holder of the Second Lien Notes and Stub Holders participating in the Exchange Offer (the “Participating Holders”) the Common Stock, Preferred Stock and Series C Warrants in accordance herewith and as set forth in the Term Sheet;

(vii) enter into the Warrant Agreement on terms and conditions consistent in all respects with this Agreement, as of the Closing Date, with SAE’s transfer agent and as warrant agent, and to issue the Warrants pursuant thereto;

(viii) negotiate in good faith the Definitive Documents, which Definitive Documents shall contain terms and conditions consistent in all respects with this Agreement and to execute and otherwise support the implementation of such Definitive Documents;

(ix) support all reasonably necessary actions of the Supporting Holders to facilitate the consummation of the Restructuring;

(x) within five days of delivery to SAE of invoices or receipts with respect thereto, pay in cash all reasonable and documented fees and expenses of Paul, Weiss, Rifkind, Wharton & Garrison LLP (“Paul Weiss”), primary legal counsel to the Supporting Holders (the “Professional Fees”);

(xi) to obtain by the Launch Date such waivers, consents or amendments to the ABL Credit Facility and the Term Loan Facility as necessary to give effect to and permit the Restructuring;

(xii) use commercially reasonable efforts to receive the requisite shareholder votes to affect the Restructuring, to the extent required by its charter, other corporate governance documents and applicable law;

(xiii) use commercially reasonable efforts to make the shares of Common Stock to be issued in connection with the Restructuring eligible to be issued in book-entry form through the direct registry system of SAE’s transfer agent and/or The Depository Trust Company;

(xiv) maintain SAE’s and each Guarantor’s good standing under the laws of the State of Delaware and make any necessary amendments to, and take all requisite actions, corporate or otherwise under the organizational documents in furtherance of the Restructuring as soon as reasonably practicable on or after the Closing Date;

(xv) to (a) remain an SEC-registered public company and continue to file reports under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations promulgated thereunder and (b) use commercially reasonable efforts to continue to comply with the listing requirements of the Nasdaq Capital Market as of the effective date of the Restructuring so that existing shares of Common Stock will continue to be, and the new shares of Common Stock issued in the Restructuring will be, listed on the Nasdaq Capital Market on or as soon as reasonably practicable after the effective date of the Restructuring;

(xvi) to the extent that any legal or structural impediment arises that would prevent, hinder, or delay the consummation of the Restructuring, to negotiate in good faith commercially reasonable additional or alternative provisions to address any such impediment, in consultation with the Supporting Holders;

(xvii) provide prompt written notice to the Supporting Holders of (A) receipt of any written notice from any third party alleging that the consent of such party is or may be required in connection with the transactions contemplated by the Restructuring, (B) receipt of any written notice from any governmental body in connection with this Agreement or the transactions contemplated by the Restructuring, and (C) receipt of any written notice of any proceeding commenced, or, to the actual knowledge of the Company, threatened against the Company, relating to or involving or otherwise affecting in any material respect the transactions contemplated by the Restructuring.

(xviii) continue to operate its business in the ordinary course;

(xix) use commercially reasonable efforts to ensure the Alaskan tax credits are monetized in a timely manner; and

(xx) provide to the Supporting Holders and/or their respective professionals, upon reasonable advance notice to the Company; (A) reasonable access (without any material disruption to the conduct of the Company’s business) during normal business hours to the Company’s books, records, and facilities; (B) reasonable access to the respective management and advisors of the Company for the purposes of evaluating the Company’s finances and operations and participating in the planning process with respect to the Restructuring; and (C) prompt access to any information provided to any existing or prospective financing sources (including lenders under any exit financing).

(b) Negative Covenants. Subject to the terms and conditions hereof, and for so long as this Agreement has not been terminated in accordance with the terms hereof, SAE agrees that, on behalf of itself and each Guarantor party to the Second Lien Notes Indenture, as applicable, it shall not, directly or indirectly, take any of the following actions, unless such action is consented to by the Required Supporting Holders:

(i) modify the Restructuring, in whole or in part, in a manner that is inconsistent with the terms of this Agreement;

(ii) commence any proceeding opposing any of the terms of this Agreement or otherwise take any action to obstruct or delay the consummation of the Restructuring;

(iii) incur or suffer to exist any material indebtedness, except indebtedness existing and outstanding immediately prior to the date hereof, trade payables, ordinary course draws under the ABL Credit Facility or Term Loan and liabilities arising and incurred in the ordinary course of business; or

(iv) directly or indirectly (1) affirmatively seek or solicit any discussions regarding the negotiation or formulation of any proposal, offer, dissolution, winding up, liquidation, reorganization, recapitalization, assignment for the benefit of creditors, merger, consolidation, business combination, joint venture, partnership, sale of assets, or restructuring of SAE other than the Restructuring (an “Alternative Proposal”), (2) publicly announce its intention not to pursue the Restructuring or (3) take any other action that is inconsistent with or is likely to delay the consummation of the Restructuring.

(c) Fiduciary Duty. Nothing in this Agreement or the Term Sheet shall prevent the Company from taking or failing to take any action that it is obligated to take (or to fail to take) in the performance of any fiduciary duty or as otherwise required by applicable law which the Company owes to any other person or entity under applicable law.

2.03 Definitive Documents.

(a) The “Definitive Documents” include, without limitation, (i) the definitive offering memorandum relating to the Exchange Offer (the “Offering Memorandum”) and ancillary documents and other amendments or consents related to the Exchange Offer, including, for the avoidance of doubt, the Consent Solicitation; (ii) the supplemental indenture to permit the entry into the Exchange Offer and related matters on the Closing Date; (iii) the definitive documents governing the Preferred Stock, including, without limitation, the certificate of designation, the material terms of which will be set forth in the Offering Memorandum; (iv) the definitive documents with respect to the Series C Warrants to be issued in connection with the Restructuring; (v) the definitive documents with respect to the management compensation arrangements set forth in the Term Sheet and any agreements or definitive documents related thereto; and (vi) any amended organizational documents or other governance documents. Each of the Definitive Documents shall be reasonably acceptable in all respects to the Required Supporting Holders, including with respect to any modifications, amendments or supplements to such Definitive Documents as permitted hereunder.

(b) Without limiting the foregoing, each Party hereby covenants and agrees to (a) negotiate in good faith the Definitive Documents, which Definitive Documents shall contain terms and conditions consistent in all respects with this Agreement and (b) execute (to the extent such Party is a party thereto) and otherwise support implementation of the Definitive Documents and any other such documents or agreements as may be reasonably necessary or advisable to implement the Restructuring, the purposes of this Agreement and the Definitive Documents.

Section 3. Representations and Warranties

3.01 Mutual Representations and Warranties. Each of the Parties, severally and not jointly, represents, warrants, and covenants to each other Party (to the extent applicable), as of the RSA Effective Date, as follows (each of which is a continuing representation, warranty, and covenant):

(a) to the extent it is an entity, it is validly existing and in good standing under the laws of the state or other jurisdiction of its organization;

(b) it has all requisite direct or indirect power and authority to enter into and perform its respective obligations under this Agreement and the Definitive Documents to which it is a party, and such Party has been authorized to enter into and perform its respective obligations under this Agreement and the Definitive Documents;

(c) the execution, delivery, and performance by such Party of this Agreement does not and will not (i) violate any provision of law, rule, or regulation applicable to it or any of its subsidiaries or its charter or bylaws (or other similar governing documents) or those of any of its subsidiaries, or (ii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation to which it or any of its subsidiaries is a party;

(d) the execution, delivery, and performance by such Party of this Agreement does not and will not require any registration or filing with, consent, or approval of, or notice to, or other action to, with or by, any federal, state, or governmental authority or regulatory body, except such filings as may be necessary and/or required by the Exchange Act or other securities regulatory authorities under applicable securities laws;

(e) this Agreement is the legally valid and binding obligation of such Party, enforceable in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer, fraudulent conveyance or other similar laws relating to or limiting creditors’ rights generally, by equitable principles relating to enforceability or by the implied covenant of good faith and fair dealing; and

(f) it has been represented by legal counsel of its choosing in connection with this Agreement and the transactions contemplated by this Agreement, has had the opportunity to review this Agreement with its legal counsel, and has not relied on any statements made by any other Party or such other Party’s legal counsel as to the meaning of any term or condition contained herein or in deciding whether to enter into this Agreement or the transactions contemplated hereby.

3.02 Representations and Warranties of the Supporting Holders. Each Supporting Holder, separately and not jointly, represents and warrants to the best of its knowledge, as of the date hereof that:

(a) with respect to the Second Lien Notes (each a “Holding”) held by such Supporting Holder, it:

(i) either (1) is the sole beneficial owner of the principal amount of such Holding, or (2) has sole investment or voting discretion with respect to the principal amount of such Holding and has the power and authority to bind the beneficial owners of such Holding to the terms of this Agreement, and (ii) has full power and authority to act on behalf of, vote, and consent to matters concerning such Holding; provided that the amount of Holding held by such Supporting Holder shall not include any Holding held in a fiduciary capacity or held by any other division, distinct business unit or trading desk of such Supporting Holder (other than the division, business unit or trading desk expressly identified on the signature pages hereto) whose activities in connection with the administration of such Holding are separated from and not coordinated with such Supporting Holder’s activities, unless and until such division, business unit or trading desk is or becomes a party to this Agreement; provided further that, the foregoing representation shall not be violated as a result of Holdings currently being out for loan pursuant to a securities lending program so long as the Supporting Holder recalls such Holding (and the settlement of such recall occurs) prior to the expiration of the Exchange Offer; and

(ii) except as expressly permitted and accomplished in accordance with Section 5 of this Agreement, such Supporting Holder has made no assignment, sale, participation, grant, conveyance, pledge, or other transfer of, and has not entered into any other agreement to assign, sell, use, participate, grant, convey, pledge, or otherwise transfer, in whole in or part, any portion of its right, title, or interests in any such Holding held by the Supporting Holder that materially conflicts with the representations and warranties of such Supporting Holder in this Agreement or that would render such Supporting Holder otherwise unable to comply with this Agreement and perform its obligations hereunder, including its obligation to support the Restructuring, in all material respects; and

(b) the Supporting Holders, in entering into this Agreement and participating in the Restructuring, have not acted as a partnership, limited partnership, syndicate, or other “group” (as that term is used in Section 13(d) of the Exchange Act) for the purpose of acquiring, holding, disposing, or voting of securities of SAE; and

(c) with respect to the Second Lien Notes held by each Supporting Holder, such Second Lien Notes are owned by a person that is either (x) not a Company Affiliate or (y) a Specified Supporting Holder. For purposes of this Section 3.02(c), “Company Affiliate” means any owner of Second Lien Notes that directly or indirectly controls or is controlled by or is under direct or indirect common control with SAE or any Guarantor. For purposes of this Section 3.02(c), “Specified Supporting Holder” means any owner of Second Lien Notes who was a holder of Stub Notes as of July 27, 2016 and who entered into the Restructuring Support Agreement dated June 13, 2016, as amended, with SAE.

Notwithstanding the foregoing, the Parties acknowledge that all representations, warranties, covenants, and other agreements made by any Supporting Holder that is a separately managed account of an investment manager are being made only with respect to the claims managed by such investment manager, and shall not apply to (or be deemed to be made in relation to) any claims that may be beneficially owned by such Supporting Holder that are not held through accounts managed by such investment manager.

3.03 Representations and Warranties of the Company. SAE, on behalf of itself and each Guarantor party to the Second Lien Notes Indenture, as applicable, represents and warrants to the best of its knowledge, as of the date hereof that:

(a) it has, or upon the receipt of shareholder consents will have, authorized sufficient shares of Common Stock and Preferred Stock to effect the Restructuring as contemplated by this Agreement; and

(b) it has no knowledge of any “Default” or “Event of Default” under the ABL Credit Facility, Term Loan, or the Second Lien Notes Indenture which has occurred and is continuing.

Section 4. Termination Events

4.01 Supporting Holder Termination Events. The Required Supporting Holders may terminate this Agreement upon three business days’ prior written notice to SAE, unless otherwise set forth below, delivered in accordance with Section 8.11 hereof, upon the occurrence and continuation of any of the following events (each, a “Supporting Holder Termination Event”):

(a) the Launch Date shall not have occurred by December 22, 2017 or such later date as mutually agreed to by the Company and the Required Supporting Holders;

(b) the Closing Date with respect to the Exchange Offer shall not have occurred or the Minimum Condition has not been satisfied by February 14, 2018 or such later date as mutually agreed to by the Company and the Required Supporting Holders;

(c) the breach or noncompliance by SAE or any Guarantor under the Second Lien Notes Indenture (or failure to satisfy) in any material respect any of the obligations, representations, warranties, or covenants of such parties as set forth in this Agreement (including, without limitation, in Sections 2.02 or 2.04 hereto) that remains uncured for three business days after the receipt by SAE of written notice of such breach, but solely to the extent such breach or noncompliance is materially adverse to the Supporting Holders or materially affects the ability of SAE, on behalf of itself and its subsidiary Guarantors, to consummate the Restructuring contemplated herein;

(d) the issuance by any governmental authority, including any regulatory authority or court of competent jurisdiction, of any ruling or order declaring this Agreement or any material portion to be unenforceable or enjoining or otherwise restricting the consummation of the Restructuring in a way that cannot reasonably be remedied by SAE;

(e) the occurrence of an event of default beyond applicable grace period under (i) the ABL Credit Facility, (ii) the Term Loan Facility, (iii) the Stub Notes Indenture, or (iv) the Second Lien Notes Indenture, in each case, subject to all applicable notice, waiver, and cure provisions;

(f) SAE or any Guarantor under the Second Lien Notes Indenture executes a letter of intent or similar document stating an intention to pursue an alternative restructuring, liquidation, reorganization, wind-down, exchange, transaction, including an Alternative Proposal, other than that contemplated by this Agreement; or

(g) any of the Definitive Documents, or other documents in respect of the Restructuring are inconsistent with the material terms and conditions set forth in this Agreement, the Term Sheet or their respective exhibits and schedules;

Notwithstanding the foregoing, this Agreement shall, without any additional act or notice by any party, terminate immediately upon the occurrence of any of the following, except to effect the Restructuring as contemplated by this Agreement: (1) SAE or any Guarantor under the Second Lien Notes Indenture (a) consenting to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, or similar official of SAE or any substantial part of SAE’s property, (b) seeking any arrangement, adjustment, protection, or relief from its debts, or (c) making a general assignment for the benefit of its creditors; (2) SAE or any Guarantor under the Second Lien Notes Indenture commencing a voluntary case filed under title 11 of the United States Code; or (3) an involuntary case is filed against SAE or any Guarantor under the Second Lien Notes Indenture.

4.02 SAE Termination Events. SAE may terminate its obligations under this Agreement upon five business days’ prior written notice delivered to the Parties in accordance with Section 8.11 hereof, upon SAE’s knowledge of the occurrence of any of the following events (each, an “SAE Termination Event,” and together with the Supporting Holder Termination Events, the “Termination Events,” and each a “Termination Event”):

(a) the material breach by any of the Supporting Holders of any of the obligations, or covenants of such Supporting Holders set forth in this Agreement or any representation and warranty of such Supporting Holders failing to be accurate that would have a material adverse impact on the implementation or consummation of the Restructuring and that remains uncured for a period of five business days after the receipt by the breaching Supporting Holder(s) of written notice of such breach from SAE, but only if the non-breaching Supporting Holders own less than 85% of the Second Lien Notes;

(b) the issuance by any governmental authority, including any regulatory authority or court of competent jurisdiction, of any ruling or order declaring this Agreement or any material portion hereof to be unenforceable or enjoining or otherwise restricting the consummation of the Restructuring in a way that cannot reasonably be remedied by SAE; or

(c) the board of directors of the Company determines, after receiving advice from counsel, that proceeding with the Restructuring would be inconsistent with the exercise of its fiduciary duties.

4.03 Effect of Termination

(a) Upon any termination of this Agreement under Sections 4.01 or 4.02, this Agreement shall be of no further force and effect and each Party hereto shall be released from its commitments, undertakings, and agreements under or related to this Agreement and shall be entitled to take all actions, whether with respect to the Restructuring or otherwise, that they would have been entitled to take had they not entered into this Agreement; provided, however, that the SAE’s obligation to pay Professional Fees shall survive with respect to those reasonable and documented Professional Fees incurred through and including the date this Agreement is terminated. Notwithstanding the foregoing, any claim for breach of this Agreement that accrued prior to the date of a Party’s termination or termination of this Agreement (as the case may be) and all rights and remedies of the Parties hereto shall not be prejudiced as a result of termination.

(b) Notwithstanding any provision in this Agreement to the contrary, no Party shall terminate this Agreement if such Party is then in material breach of any provision hereof.

4.04 Termination Upon Consummation of the Restructuring. This Agreement shall terminate automatically without any further required action or notice upon the Closing Date.

Section 5. Transfer of Holdings

Without limiting the transfer restrictions under the Second Lien Indenture, each Supporting Holder agrees that so long as this Agreement has not been terminated in accordance with its terms, it shall not directly or indirectly sell, assign, pledge, hypothecate, convey, or otherwise transfer or dispose of or grant, issue, or sell any option, right to acquire, voting, participation, or other interest (each, a “Transfer”) in any Holding, unless the transferee thereof either (i) is a Supporting Holder and agrees to exchange such additional Holding and deliver related consents in the Exchange Offer, or (ii) prior to such Transfer, agrees in writing for the benefit of the other Parties to become a Supporting Holder and to be bound by all of the terms of this Agreement with respect to such acquired Holding by executing the joinder in the form attached hereto as Exhibit I (the “Joinder Agreement”), and delivering an executed copy thereof, within five business days of closing of such Transfer, to counsel to SAE and counsel to the Supporting Holders, as listed in Section 8.11 hereof, in which event the transferee (including a Supporting Holder transferee, if applicable) shall be deemed to be a Supporting Holder under this Agreement with respect to such transferred rights, claims, and obligations. Notwithstanding anything contained herein to the contrary, a Supporting Holder may Transfer any or all of its Holdings to any entity that, as of the date of the Transfer, controls, is controlled by, or is under common control with such Supporting Holder; provided, however, that such entity shall automatically be subject to the terms of this Agreement and deemed a Party hereto and must deliver an executed Joinder Agreement within five business days of the closing of such Transfer to counsel to SAE and counsel to the Supporting Holders. Each Supporting Holder agrees and acknowledges that any Transfer of any Holdings that does not comply with the terms and procedures set forth in this Section 5 shall be deemed null and void ab initio.

Notwithstanding anything to the contrary in this Section 5, (i) a Qualified Marketmaker (as defined below) that acquires any Holdings from a Supporting Holder with the purpose and intent of acting as a Qualified Marketmaker for such Holdings (with the understanding that the Qualified Marketmaker will agree at the time of such acquisition to the terms of this paragraph), shall not be required to execute and deliver a Joinder Agreement or otherwise agree to be bound by this Agreement; and (ii) to the extent any Party is acting solely in its capacity as a Qualified Marketmaker, it may Transfer any ownership interests in the Holdings that it acquires from an existing holder of the Second Lien Notes that is not or has not been a Supporting Holder to a transferee that is not a Supporting Holder at the time of such Transfer without the requirement that the transferee be or become a signatory to this Agreement or execute a Joinder Agreement.

As used herein, “Qualified Marketmaker” means an entity that (a) holds itself out to the public or applicable private markets as standing ready in the ordinary course of business to purchase from customers and sell to customers claims against SAE (or enter with customers into long and short positions in claims against SAE), in its capacity as a dealer or marketmaker in claims against SAE and (b) is, in fact, regularly in the business of making a market in claims against issuers or borrowers (including debt securities or other debt).

Section 6. Amendments

This Agreement, the Definitive Documents and any annexes or exhibits thereto may not be modified, amended, or supplemented, nor may any terms and conditions hereof or thereof be waived, without the prior written consent of SAE and the Required Supporting Holders. As used in this Agreement, “Required Supporting Holders” means Whitebox Advisors LLC, BlueMountain Capital Management, LLC, and Highbridge Capital Management LLC. Notwithstanding the foregoing, no modification, amendment or alteration shall be made in connection with the Restructuring to (a) the material terms of the Second Lien Notes or (b) the material economic terms of the Exchange Offer, in each case, without the prior written consent of each Supporting Holder.

Section 7. No Solicitation of Securities

Notwithstanding anything to the contrary herein, this Agreement is not and shall not be deemed to be an offer for the issuance, purchase, sale, exchange, hypothecation, or other transfer of securities or a solicitation of an offer to purchase, sell, exchange or acquire securities for purposes of the Securities Act of 1933, as amended, and the Exchange Act.

Section 8. Miscellaneous

8.01 Further Assurances. Subject to the other terms hereof, the Parties agree to execute and deliver such other instruments and perform such acts, in addition to the matters herein specified, as may be commercially reasonably appropriate or necessary, from time to time, to effectuate the Restructuring in accordance with this Agreement.

8.02 Complete Agreement. This Agreement, exhibits and the annexes hereto, represent the entire agreement between the Parties with respect to the subject matter hereof and supersede all prior agreements, oral or written, between the Parties with respect thereto. No claim of waiver, consent, or acquiescence with respect to any provision of this Agreement, exhibits, and annexes hereto shall be made against any Party, except on the basis of a written instrument executed by or on behalf of such Party.

8.03 No Assignment. This Agreement shall be binding upon, and inure to the benefit of, the Parties. No rights or obligations of any Party under this Agreement may be assigned or transferred to any other person or entity, except as provided in this Agreement. Nothing in this Agreement, express or implied, shall give to any person or entity, other than the Parties, any benefit or any legal or equitable right, remedy, or claim under this Agreement.

8.04 Headings. The headings of all Sections of this Agreement are inserted solely for the convenience of reference and are not a part of and are not intended to govern, limit, or aid in the construction or interpretation of any term or provision hereof.

8.05 Governing Law; Submission to Jurisdiction; Selection of Forum; Waiver of Trial by Jury. This Agreement is to be governed by and construed in accordance with the laws of the State of New York. Each Party hereto agrees that it shall bring any action or proceeding in respect of any claim arising out of or related to this Agreement in the United States District Court for the Southern District of New York, and by execution and delivery of this Agreement, each of the Parties irrevocably accepts and submits itself to the exclusive jurisdiction of such court, generally and unconditionally, with respect to any such action, suit or proceeding. Each Party here irrevocably waives any and all right to trial by jury in any legal proceeding arising out of or related to this Agreement or the transactions contemplated hereby.

8.06 Counterparts. This Agreement may be executed and delivered (by facsimile, email, or otherwise) in any number of counterparts, each of which, when executed and delivered, shall be deemed an original, and all of which together shall constitute the same agreement.

8.07 Interpretation. This Agreement is the product of negotiations between the Parties, and in the enforcement or interpretation hereof, is to be interpreted in a neutral manner, and any presumption with regard to interpretation for or against any Party by reason of that Party having drafted or caused to be drafted this Agreement, or any portion hereof, shall not be effective in regard to the interpretation hereof.

8.08 Relationship Among Supporting Holders. It is understood and agreed that no Supporting Holder has any duty of trust or confidence of any kind or form with any other Supporting Holders as a result of this Agreement, and, except as expressly provided in this Agreement, there are no commitments among or between them. It is further understood and agreed that any Supporting Holder may trade in the Second Lien Notes or other debt or equity securities of SAE without the consent of SAE or any other Supporting Holder, subject to applicable securities laws and the terms of this Agreement; provided, however, that no Supporting Holder shall have any responsibility for any such trading by any other entity by virtue of this Agreement. No prior history, pattern, or practice of sharing confidences among or between the Supporting Holders shall in any way affect or negate this understanding and agreement. No Supporting Holder shall, as a result of its entering into and performing its obligations under this Agreement, be deemed to be a part of a “group” (as that term is used in Section 13(d) of the Exchange Act) with any other Party. For the avoidance of doubt, no action taken by a Supporting Holder pursuant to this Agreement shall be deemed to constitute or to create a presumption by any of the Parties that the Supporting Holders are in any way acting in concert or as such a “group.” The execution of this Agreement by any Supporting Holder shall not create, or be deemed to create, any fiduciary duties (actual or implied) to any other Supporting Holder.

8.09 Successors and Assigns. This Agreement is intended to bind and inure to the benefit of the Parties and their respective successors, assigns, heirs, executors, administrators and representatives, other than a trustee or similar representative appointed in a bankruptcy case.

8.10 Acknowledgements. Notwithstanding anything herein to the contrary, none of the Supporting Holders shall (a) have any fiduciary duty or (b) other duties or responsibilities to each other, SAE, any subsidiary or affiliate of SAE, or any of SAE’s creditors or other stakeholders.

8.11 Notices. All notices hereunder shall be deemed given if in writing and delivered, if sent by hand delivery, electronic mail, courier, or overnight delivery (return receipt requested) to the following addresses (or at such other addresses as shall be specified by like notice):

(a)

if to SAE, to:

SAExploration Holdings, Inc.

1160 Dairy Ashford Rd., Suite 160

Houston, Texas 77079

Attn: Brent Whiteley

Chief Financial Officer, General Counsel and Secretary

with copies to:

Akin Gump Strauss Hauer & Feld LLP

1700 Pacific Ave., Suite 4100

Dallas, Texas 75201

Attn: Sarah Link Schultz

David H. Botter

E-mail address: ***@***

***@***

(b)

if to the Supporting Holders, to:

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, New York 10019

Attn: Andrew N. Rosenberg

Larry G. Wee

E-mail address: ***@***

***@***

Any notice given by hand delivery, electronic mail, mail, or courier shall be effective when received.

8.12 Disclosure of Supporting Holder Information. Unless required by applicable law or regulation, each Party agrees to keep confidential the amount of all Holdings in the Company held (beneficially or otherwise) by any individual Supporting Holder absent the prior written consent of such Supporting Holder; provided, however, that the Company may disclose the identity of each Supporting Holder and the aggregate amount of all Holdings in the Company held by the Supporting Holders. The Company shall use commercially reasonable efforts to submit drafts to the Supporting Holders of any press releases, public documents and any and all filings with the SEC that constitute disclosure of the existence or terms of this Agreement or any amendment to the terms of this Agreement at least one (1) business day prior to making any such disclosure. Any public filing of this Agreement that includes executed signature pages to this Agreement shall include such signature pages only in redacted form with respect to the holdings of each Supporting Holder. The Parties’ obligations under this Section 8.12 shall survive termination of this Support Agreement.

8.13 Waiver. Except as expressly provided in this Agreement, nothing herein is intended to, or does, in any manner waive, limit, impair, or restrict any right of any Supporting Holder, Indenture Trustee or SAE or the ability of each of the Supporting Holders, Indenture Trustee or SAE to protect and preserve its respective rights, remedies and interests. If the Restructuring is not consummated, or if this Agreement is terminated for any reason, the Parties fully reserve any and all of their rights.

8.14 Several, Not Joint, Obligations. The agreements, representations and obligations of the Parties under this Agreement are, in all respects, several and not joint.

8.15 Remedies. All rights, powers, and remedies provided under this Agreement or otherwise available in respect hereof at law or in equity shall be cumulative and not alternative, and the exercise of any right, power, or remedy thereof by any Party shall not preclude the simultaneous or later exercise of any other such right, power, or remedy by such Party or any other Party.

8.16 Specific Performance. This Agreement is intended as a binding commitment enforceable in accordance with its terms against the Parties. It is understood and expressly agreed by each of the Parties that money damages would not be a sufficient remedy for any breach of this Agreement by any Party, and each non-breaching Party shall be entitled to specific performance and injunctive or other equitable relief as a remedy for any such breach without the necessity of proving the inadequacy of money damages as a remedy and without posting security for such relief.

8.17 No Third-Party Beneficiaries. Unless expressly stated herein, this Agreement shall be solely for the benefit of the Parties, and no other person or entity shall be a third-party beneficiary hereof.

8.18 Consideration. The Parties hereby acknowledge that no consideration, other than that specifically described herein and the Definitive Documents, shall be due or paid to any Party for its agreement to accept the Restructuring in accordance with the terms and conditions of this Agreement.

8.19 Survival. Notwithstanding anything herein to the contrary, the acknowledgements, agreements and obligations of the Parties in this Section 8.19 and Sections 2.01(e), 4.03(a), 8.08, 8.09, 8.12 and 8.15 shall survive any termination of this Agreement and shall continue in full force and effect in accordance with the terms thereof.

[Signatures on Following Page]

IN WITNESS WHEREOF, the Company and the Supporting Holders have caused this Agreement to be executed and delivered by their respective and duly authorized officers or other agents, solely in their respective capacity as officers or other agents of the undersigned and not in any other capacity, as of the date first set forth above.

SAExploration Holdings, Inc.

/s/ Brent Whiteley

Name: Brent Whiteley

Title: CFO & General Counsel

SAExploration Sub, Inc.

/s/ Brent Whiteley

Name: Brent Whiteley

Title: CFO & General Counsel

SAExploration, Inc.

/s/ Brent Whiteley

Name: Brent Whiteley

Title: CFO & General Counsel

SAExploration Seismic Services (US), LLC

/s/ Brent Whiteley

Name: Brent Whiteley

Title: CFO & General Counsel

NES, LLC

/s/ Brent Whiteley

Name: Brent Whiteley

Title: CFO & General Counsel


Whitebox Asymetric Partners, LP

By:		/s/ Mark Strefling
Name:		Mark Strefling
Title:		CEO

Whitebox Credit Partners, LP

By:		/s/ Mark Strefling
Name:		Mark Strefling
Title:		CEO

Whitebox Multi-Strategy Partners, LP

By:		/s/ Mark Strefling
Name:		Mark Strefling
Title:		CEO

Whitebox Institutional Partners, LP

By:		/s/ Mark Strefling
Name:		Mark Strefling
Title:		CEO