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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 20, 1998
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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EAGLE GEOPHYSICAL, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 76-0522659
(State or Other Jurisdiction of Incorporation (I.R.S. Employer
or Organization) Identification No.)
50 BRIAR HOLLOW LANE
6TH FLOOR WEST
HOUSTON, TEXAS 77027
(713) 881-2800
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
JAY N. SILVERMAN, PRESIDENT
EAGLE GEOPHYSICAL, INC.
50 BRIAR HOLLOW LANE
6TH FLOOR WEST
HOUSTON, TEXAS 77027
(713) 881-2800
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies to:
WILLIAM MARK YOUNG
GARDERE WYNNE SEWELL & RIGGS, L.L.P.
THREE ALLEN CENTER
333 CLAY AVENUE, SUITE 800
HOUSTON, TEXAS 77002-4086
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO THE
PUBLIC: FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION
STATEMENT UNTIL SUCH TIME THAT ALL OF THE SHARES REGISTERED HEREUNDER HAVE BEEN
SOLD.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: |X|
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration number of the earlier effective
registration statement for the same offering. [ ]
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If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the offering. [ ]
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If the delivery of the prospectus is expected to be made pursuant
to Rule 434, please check the following box: [ ]
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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PROPOSED MAXIMUM PROPOSED MAXIMUM
AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
TITLE OF SHARES TO BE REGISTERED REGISTERED PER SHARE (1) OFFERING PRICE (1) REGISTRATION FEE
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<S> <C> <C> <C> <C>
Common Stock, $0.01 par value......... 1,520,000 $9.81 $14,915,000.00 $4,400.00
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</TABLE>
(1) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(c) of the Securities Act of 1933, as
amended, based upon the average of the high and low sales price for the
Common Stock as quoted on The Nasdaq Stock Market's National Market for
August 17, 1998.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL
PRIOR TO REGISTRATION, QUALIFICATION OR FILING UNDER THE SECURITIES LAWS OF ANY
SUCH JURISDICTION.
SUBJECT TO COMPLETION, DATED AUGUST 20, 1998
PROSPECTUS
1,520,000 SHARES
EAGLE GEOPHYSICAL, INC.
COMMON STOCK
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This Prospectus relates to 1,520,000 shares (the "Shares") of common stock,
$0.01 par value (the "Common Stock"), of Eagle Geophysical, Inc. ("Eagle" or the
"Company"), which may be offered by or for the account of the stockholder of the
Company named herein (the "Selling Stockholder"). See "Selling Stockholder." The
Company will not receive any of the proceeds from sales of the Shares offered
hereby.
The Selling Stockholder may from time to time sell the Shares on The Nasdaq
Stock Market's National Market (the "Nasdaq National Market") or any other
national securities exchange on which the Common Stock may be listed or traded,
in negotiated transactions, or by a combination of such methods of sale, at
fixed prices which may be changed, at market prices prevailing at the time of
sale, at prices related to such prevailing market prices or at negotiated
prices. The Selling Stockholder may effect such transactions by selling the
Shares to or through broker-dealers, and such broker-dealers may receive
compensation in the form of discounts, concessions or commissions from the
Selling Stockholder and/or the purchasers of the Shares for whom such
broker-dealers may act as agents or to whom they sell as principals, or both
(which compensation to a particular broker-dealer might be in excess of
customary commissions). See "Plan of Distribution."
The Company has agreed to bear certain expenses (other than fees and
expenses, if any, of counsel and other advisors to the Selling Stockholder and
any brokerage fees or commissions) in connection with the registration and sale
of the Shares. The Company and the Selling Stockholder have agreed to indemnify
the other and their respective controlling persons against certain liabilities,
including certain liabilities under the Securities Act of 1933, as amended (the
"Securities Act").
The Selling Stockholder and any broker-dealers or agents that participate
with the Selling Stockholder in the distribution of the Shares may be deemed to
be "underwriters" within the meaning of Section 2(11) of the Securities Act, and
any commissions received by them and any profit on the resale of the Shares
purchased by them may be deemed to be underwriting commissions or discounts
under the Securities Act.
Shares of the Common Stock are listed on the Nasdaq National Market under
the trading symbol "EGEO." On August 17, 1998, the closing price of the Common
Stock on the Nasdaq National Market was $9.688 per share.
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SEE "RISK FACTORS" BEGINNING ON PAGE 3 OF THIS PROSPECTUS FOR A DISCUSSION
OF CERTAIN FACTORS WHICH SHOULD BE CONSIDERED IN EVALUATING THE SECURITIES
OFFERED HEREBY.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
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THE DATE OF THIS PROSPECTUS IS ,1998
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files periodic reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports and
other information may be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington
D.C. 20549, and at the following regional offices of the Commission: Northwest
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and
Seven World Trade Center, Suite 1300, New York, New York 10048. Copies of such
material may also be obtained at prescribed rates from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. The
Commission maintains a site on the World Wide Web that contains reports, proxy
and information statements and other information filed electronically by the
Company with the Commission that can be accessed at http://www.sec.gov. In
addition, reports, proxy statements and other information filed by the Company
can be inspected at the offices of The Nasdaq Stock Market, Inc., 1735 K Street,
Washington, D.C. 20006.
The Company has filed a Registration Statement on Form S-3 (together with
all the amendments, supplements and exhibits thereto, the "Registration
Statement") with the Commission under the Securities Act with respect to the
Shares. This Prospectus does not contain all of the information set forth in the
Registration Statement and the exhibits thereto, certain parts of which are
omitted in accordance with the rules and regulations of the Commission. The
Registration Statement and any amendments hereto, including exhibits filed as a
part thereof, are available for inspection and copying as set forth above.
Statements contained in this Prospectus or in any document incorporated in this
Prospectus by reference as to the contents of any contract or other document
referred to herein or therein are not necessarily complete, and in each instance
reference is made to the copy of such contract or other document filed as an
exhibit to the Registration Statement or such other document, each such
statement being qualified in all respects by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company (Commission File No. 0-22863)
with the Commission pursuant to the Exchange Act are hereby incorporated herein
by reference in this Prospectus:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997;
(2) The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1998 and June 30, 1998;
(3) The Company's Current Report on Form 8-K dated June 29, 1998; and
(4) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-A, as filed with the Commission on
July 22, 1997.
All documents and reports filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
shall be deemed to be incorporated by reference herein and to be a part hereof
from the respective dates of filing of such documents or reports. Any person to
whom a copy of this Prospectus is delivered may obtain, without charge, upon
written or oral request, a copy of any of the documents incorporated by
reference herein, except for the exhibits to such documents (other than exhibits
expressly incorporated by reference into such documents). Requests for such
documents should be addressed to Eagle Geophysical, 50 Briar Hollow Lane, 6th
Floor West, Houston, Texas 77027, attention: Richard W. McNairy, or directed to
Richard W. McNairy at (713) 881-2800.
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RISK FACTORS
Prior to making an investment in the Common Stock, prospective
purchasers should carefully consider all of the information contained and
incorporated by reference in this Prospectus and, in particular, should evaluate
the following risk factors.
DEPENDENCE UPON ENERGY INDUSTRY SPENDING
Demand for the Company's services depends upon the level of capital
expenditures by oil and gas companies for exploration, production and
development activities. These activities depend in part on oil and gas prices,
expectations about future prices, the cost of exploring for, producing and
delivering oil and gas, the sale and expiration dates of leases in the United
States and abroad, the discovery rate of new oil and gas reserves, local and
international political, regulatory and economic conditions and the ability of
oil and gas companies to obtain capital. In addition, a decrease in oil and gas
expenditures could result from such factors as unfavorable tax and other
legislation or uncertainty concerning national energy policies. No assurance can
be given that current levels of oil and gas activities will be maintained or
that demand for the Company's services will reflect the level of such
activities. Decreases in oil and gas activities could have a significant adverse
effect upon the demand for the Company's services and the Company's cash flows
and results of operations.
INVESTMENT IN MULTI-CLIENT DATA
Historically, the Company has performed its offshore seismic data
acquisition services for its customers primarily on a contract basis without
retaining any interest in the data it acquired. However, increasing demand for
larger and higher-cost 3D surveys has resulted in significantly increased
industry acceptance of and customer demand for multi-client surveys. As a result
of this industry trend and customer demand, the Company anticipates that an
increasing part of its future offshore data acquisition projects will be
multi-client surveys. The Company therefore anticipates that in the near term it
will begin investing increasing amounts in acquiring and processing multi-client
data. By making such investments, the Company will assume the risk that future
sales of such data may not fully recoup the costs of the data. The amounts of
these data sales will be uncertain and will be impacted by a number of factors,
many of which are beyond the control of the Company. In addition, revenues
generated by licensing multi-client data are typically less predictable from
period to period than are revenues from surveys performed on an exclusive
contract basis for customers. The Company intends to seek to reduce these risks
by acquiring multi-client data in partnership with third parties or by obtaining
pre-acquisition licensing commitments to cover part of its costs of acquiring
the data and by evaluating various factors affecting the sales potential of each
survey. In addition, the recovery of costs of multi-client data is dependent
upon the absence of technological or regulatory changes or other developments
that would render such data obsolete or less valuable.
The majority of the Company's investment in multi-client data is likely
to be in the Gulf of Mexico. If there were to occur any material adverse change
in the general prospects for oil and gas exploration, development and production
activities in the Gulf of Mexico, the value of the Company's multi-client data
in the Gulf of Mexico could be significantly adversely impacted.
RISKS IN INTERNATIONAL OPERATIONS
A significant portion of the Company's revenues is derived from
operations outside the U.S., and the Company is subject to the risks inherent in
doing business internationally. In addition, the Company intends to expand its
international operations. Since the Company has an established presence in the
North Sea, the Company does not view its offshore operations in the North Sea as
being subject to undue risks of this type. However, as the Company expands the
scope and extent of its onshore and offshore operations outside of their current
primary areas of operations in the U.S. Gulf Coast, the North Sea and the Gulf
of Mexico, these risks may become more significant. Such risks include the
possibility of unfavorable changes in tax or other laws, partial or total
expropriation, currency exchange rate fluctuations and restrictions on currency
repatriation, the disruption of operations from labor and political
disturbances, insurrection or war, and the effect of requirements of partial
local ownership of operations in certain countries.
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SUBSTANTIAL COMPETITION
The offshore and onshore seismic data acquisition business is highly
competitive. Competitive factors include price, experience, availability,
technological expertise, performance and reputation for dependability. Certain
of the Company's major competitors operate more data acquisition crews than the
Company, provide integrated data acquisition, processing and interpretation
services, have substantially greater revenues than the Company or are
subsidiaries or divisions of major industrial enterprises having far greater
financial and other resources than the Company and more extensive relationships
with major integrated and multinational oil and gas companies. Such resources
may enable these competitors to maintain technological and certain other
advantages relating to costs that may provide them with an advantage over the
Company in bidding for contracts.
OPERATING RISKS
Seismic operations are subject to risks of injury to personnel and loss
of equipment. In addition, the Company's crews often conduct operations in
extreme weather, in difficult terrain that is not easily accessible and under
other hazardous conditions. Each of the Company's vessels is taken out of
service for approximately two to four weeks each year, generally at different
off-season times of the year, for routine maintenance and service. Fixed costs,
including costs associated with operating leases, labor costs and depreciation,
account for a significant amount of the Company's costs and expenses. As a
result, low productivity resulting from weather interruptions, equipment
failures or other causes can result in significant operating losses,
particularly when the Company is performing its services under a turnkey
contract. Although the Company provides the seismic personnel on its offshore
seismic data acquisition vessels, the Company contracts with third parties to
provide vessel crews, so the Company does not control some aspects of its
operations and is subject to the safety risks inherent in relying on third
parties for critical operations. In addition, while the Company has insurance
policies that protect it against liabilities that may be incurred in the
ordinary course of its business, the Company is unable to insure fully against
all possible loss or liability. For example, no insurance is available at a cost
deemed reasonable by the Company for war, nationalization, expropriation or
other extreme events. The Company does not carry business interruption insurance
with respect to its operations.
LIMITED COMBINED OPERATING HISTORY
The Company was formed to combine the onshore seismic data acquisition
business conducted by Seitel Geophysical, Inc. ("SGI") with the offshore seismic
data acquisition business conducted by Energy Research International ("ERI") and
its operating subsidiaries (the "Horizon Companies," and collectively with SGI,
the "Combined Businesses"). The Company acquired ERI in August 1997 at the time
of the Company's initial public offering of its Common Stock (the "IPO"). Prior
to the Company's IPO, the Combined Businesses were operated separately, and
neither the historical results of their separate operations nor their pro forma
financial information is necessarily indicative of the results that would have
been achieved had the Combined Businesses been operated on an integrated basis
or the results that may be realized in the future. In addition, prior to the
IPO, the Company was a subsidiary of Seitel, Inc. ("Seitel") and relied on
Seitel for certain financial, management, administrative and other resources. A
number of significant changes occurred in the funding and operations of the
Company in connection with the consummation of the IPO. These changes included
the establishment of the Company's Revolving Credit Facility and its own
incentive compensation and stock option plans. These changes may have a
substantial impact on the financial position and future results of operations of
the Company. As a result, the historical financial information included in this
Prospectus does not necessarily reflect the financial position and results of
operations of the Company in the future or what the financial position and
results of operations of the Company would have been had the Combined Businesses
been operated as a combined stand-alone entity during all of the periods
presented.
CONCENTRATION OF CREDIT RISK
The Company generally provides services to a relatively small group of
key customers that account for a significant percentage of the accounts
receivable of the Company at any given time. The Company's key customers vary
over time, but have historically included Seitel and its subsidiaries. The
Company extends credit to various companies in the oil and gas industry,
including its key customers, for the acquisition of seismic data, which results
in a concentration of credit risk. This concentration of credit risk may be
affected by changes in the economic or other
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conditions of the Company's key customers and may accordingly impact the
Company's overall credit risk. As of June 30, 1998, the Company had one
receivable from a customer of approximately $2.4 million that was over one year
old. There can be no assurance that the Company will collect this receivable,
and in light of the age of this receivable, the Company had increased its
reserve for doubtful accounts to $450,000 as of June 30, 1998. Historical credit
losses incurred on receivables by the Company have been immaterial.
CAPITAL INTENSIVE BUSINESS; OBSOLESCENCE OF TECHNOLOGY
The Company competes in a capital intensive industry. The development
of seismic data acquisition equipment has been characterized by rapid
technological advancements in recent years, and this trend may continue. There
can be no assurance that manufacturers of seismic equipment will not develop new
systems that have competitive advantages over systems now in use that either
render the Company's current equipment obsolete or require the Company to make
significant capital expenditures to maintain its competitive position. The
Company's strategy is to upgrade its vessels and data acquisition systems as
often as necessary to maintain its competitive position. However, any such
upgrades may require large expenditures of capital. There can be no assurance
that the Company will have the capital necessary to upgrade its equipment to
maintain its competitive position or that any required financing therefor will
be available on favorable terms. If the Company is unable to raise the capital
necessary to update its data acquisition systems to the extent necessary, it may
be materially and adversely affected.
The Company's ability to compete is highly dependent upon, among other
things, its ability to provide seismic data of a competitive quality. Because of
the significant technological changes that have already taken place with respect
to 3D seismic data acquisition and those that may occur in the future, the
Company is, like other seismic companies, generally dependent on its ability to
keep pace with changes and improvements in data acquisition technologies and to
acquire advanced equipment and vessels. Any significant technological
developments affecting seismic surveying could adversely affect the Company.
Over time, the value of and demand for seismic vessels and onshore seismic data
acquisition equipment can be expected to fluctuate, depending upon a variety of
factors including alternative types, sizes and technical abilities of competing
vessels and equipment.
RELIANCE ON KEY SUPPLIERS
The Company is dependent on Georex, Inc., a subsidiary of Compagnie
Generale de Geophysique, S.A. ("CGG"), which is a competitor of the Company, for
additions to and replacements for its Opseis onshore seismic data acquisition
systems, and Opseis is a registered trademark of CGG. The Company is also
dependent on Input/Output, Inc. and Syntron, Inc., a subsidiary of GeoScience
Corporation, for additions to and replacements for its offshore seismic data
acquisition systems and on Concept Systems Ltd. for positioning software.
Although these companies are not the only suppliers of seismic data acquisition
systems, they are the Company's primary suppliers. In addition, the Company
considers the Opseis system to be the state-of-the-art seismic data equipment
for performing 3D seismic surveys in marshes and swamps. In the event of any
disruption in the supply of repair services or replacement parts from the
Company's primary suppliers, the Company may be unable to obtain such services
or parts from other sources and would have to acquire other equipment that may
be less advanced technologically. Although the Company believes it will be able
to obtain systems from its primary suppliers in the future, should it be unable
to do so, the Company's anticipated revenues or operating margins could be
reduced significantly and the amount of cash needed for capital expenditures
could be increased significantly.
ENVIRONMENTAL AND OTHER REGULATIONS
The Company's operations are materially affected by government
regulation in the form of international conventions, national, state and local
laws and regulations in force in the jurisdictions in which the Company
operates, as well as in the country or countries of registration of the
Company's vessels. The Company is required by various governmental and
quasi-governmental agencies to obtain certain permits, licenses and certificates
with respect to its operations. In particular, the United States Oil Pollution
Act of 1990 sets forth technical and operational requirements for vessels
operating in the U.S. Gulf of Mexico. The Company believes that it possesses all
permits, licenses and certificates material to the operation of its business.
The modification of existing laws or regulations or the adoption of
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new laws or regulations curtailing drilling for oil and gas or imposing more
stringent restrictions on seismic operations could adversely affect the Company.
RISKS OF UPGRADE PROJECTS
The Company's seismic acquisition vessel upgrade projects are subject
to the risks of delay and cost overruns inherent in any large construction
project, including shortages of equipment, unforeseen engineering problems, work
stoppages, weather interference, unanticipated cost increases and shortages of
materials or skilled labor. Significant cost overruns or delays could adversely
affect the Company's financial condition and results of operations.
INFLUENCE OF SEITEL ON THE COMPANY
Prior to the Company's IPO, the Company was a subsidiary of Seitel. As
of July 31, 1998, Seitel owned approximately 17.7% of the outstanding shares of
common stock of the Company. Approximately 53% of the pro forma combined
revenues of the Company for the year ended December 31, 1997 were derived from
seismic data acquisition services provided to Seitel and its subsidiaries. Prior
to the IPO, the onshore revenues from Seitel were based on prices charged to
unaffiliated parties for similar work. Such revenues are not necessarily
indicative of the revenues the Company would have earned had it provided these
services to unrelated third parties. Prior to the IPO, the offshore revenues
from Seitel were determined by negotiations between Seitel and the Horizon
Companies, which management of the Horizon Companies believe were equal to
amounts it would have charged unrelated third parties for such services.
Revenues from Seitel for both onshore and offshore data acquisition after the
IPO have been determined by negotiations between Seitel and the Company, which
management believes are equal to amounts it would have charged unrelated third
parties for such services. The loss of Seitel as a customer would have a
material adverse effect on the Company's financial condition and results of
operations. There can be no assurance that Seitel will enter into any material
contracts with the Company for seismic data acquisition services in the future.
Prior to the IPO, Seitel guaranteed certain indebtedness of the Company
and made loans to the Company. The Company's borrowing costs may be greater than
historical borrowing costs as a result of having to obtain financing based on
its own creditworthiness.
Paul A. Frame, the President and Chief Executive Officer and a director
of Seitel, is a director of the Company, serves as Chairman of the Executive
Committee of the Board of Directors of the Company, has duties with respect to
marketing and expansion of the Company's business pursuant to a Bonus Agreement
with the Company, and has received stock options to acquire shares of Common
Stock from the Company. Consequently, in addition to its current position as a
significant customer of the Company, Seitel will be able to exercise significant
influence over the management of the Company. Such influence may extend to
matters such as the election of directors of the Company, the approval of
matters submitted for stockholder approval and responding to any potential
takeover of the Company.
In addition, Mr. William Lurie, Chairman of the Board of Directors of
the Company, was a director of Seitel prior to the Company's IPO. Mr. Jay N.
Silverman, President and Chief Executive Officer and a director of the Company,
was an executive officer of Seitel prior to the IPO. A substantial part of Mr.
Silverman's present personal assets is comprised of common stock and other
equity interests in Seitel.
POTENTIAL CONFLICTS OF INTEREST
Conflicts of interest may arise in the future between Seitel and the
Company in a number of areas relating to their past and ongoing relationships,
including potential acquisitions of businesses or properties, other business
opportunities, the election of new or additional directors, the payment of
dividends, incurrence of indebtedness, tax matters, financial commitments,
registration rights and issuances and sales of capital stock of the Company.
Although the Company and Seitel do not currently compete against each other in
any material respect, there can be no assurance that Seitel and the Company will
not in the future compete against each other. Any officer or director of Seitel
who serves as a director of the Company, such as Mr. Frame, may have conflicts
of interest in addressing business opportunities and strategies as to which
Seitel's and the Company's interests differ. The Company has not adopted any
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formal procedures to ensure that conflicts of interest will not occur or to
resolve any such conflicts of interest that do occur. There can be no assurance
that any such conflicts of interest will be resolved in favor of the Company.
RELIANCE ON KEY PERSONNEL
The Company's operations are dependent on the efforts of Messrs. Jay N.
Silverman, President, and Gerald M. Harrison, Executive Vice President. If
either of these key persons becomes unable to continue in his present role, or
if the Company is unable to attract and retain other skilled employees, the
Company's business could be adversely affected. The Company has employment
agreements with automatic renewal features with Messrs. Silverman and Harrison.
FORWARD-LOOKING STATEMENTS
This Prospectus includes forward-looking statements within the meaning
of Section 27A of the Securities Act and Section 21E of the Exchange Act. The
words "anticipate," "believe," "expect," "plan," "intend," "estimate,"
"project," "will," "could," "may," "predict" and similar terms and phrases are
intended to identify forward-looking statements. These statements involve risks
and uncertainties that may cause actual future activities and results of
operations to be materially different from those suggested or described in this
Prospectus. Among the key factors that have a direct bearing on the Company's
results of operations are the Company's leverage and liquidity, the Company's
dependence on energy industry spending, the Company's investment in multi-client
data, risks in international operations, competition, operating risks, the
Company's limited operating history, concentration of credit risks, the capital
intensive nature of the Company's business and the potential obsolescence of
technology, the Company's reliance on its key suppliers, environmental and other
regulations, risks in connection with the Company's vessel upgrade projects, the
influence of Seitel on the Company, conflicts of interest between Seitel and the
Company and reliance on the Company's key personnel. These and other factors are
discussed in "Risk Factors" and elsewhere in this Prospectus. Should one or more
of these risks or uncertainties materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those expected,
estimated or projected.
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THE COMPANY
Eagle Geophysical, Inc. is an international oilfield service company
specializing in the acquisition of high definition three-dimensional ("3D")
seismic data. Oil and gas companies regularly use seismic data to image
underground geological structures to aid in the exploration for hydrocarbon
reservoirs. The use of 3D seismic data can significantly increase the
probability of drilling success. The Company conducts its seismic data
acquisition operations both offshore and onshore, targeting particular niches in
both markets. The Company's offshore seismic acquisition operations have been
focused primarily on small and medium sized surveys in heavily congested areas,
while its onshore seismic operations have been concentrated in logistically
difficult wetland environments.
Eagle was incorporated in Delaware in December 1996. Eagle's executive
offices are headquartered at 50 Briar Hollow Lane, 6th Floor West, Houston,
Texas 77027, and its telephone number at that location is (713) 881-2800.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Shares by the Selling Stockholder.
SELLING STOCKHOLDER
This Prospectus relates to the sale by the Selling Stockholder named
below from time to time of up to 1,520,000 shares of Common Stock. The Shares
are being registered by the Company pursuant to a Registration Rights Agreement
entered into by and between the Company and the Selling Stockholder. A
description of certain relationships and transactions between the Company and
the Selling Shareholder and its affiliates during the past three years is set
forth after the following table.
The following table provides certain information with respect to the
number of shares of Common Stock currently owned, offered hereby and to be owned
by the Selling Stockholder after this offering assuming all offered shares are
sold in this offering.
<TABLE>
<CAPTION>
NUMBER OF
SHARES SHARES BENEFICIALLY
BENEFICIALLY OWNED AFTER THE
OWNED SHARES OFFERING
BEFORE THE OFFERED -----------------------------
SELLING STOCKHOLDER OFFERING HEREBY NUMBER PERCENT
- -------------------------------------------------------- -------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
EHI Holdings, Inc.(1)................................... 1,520,000 1,520,000 -0- 0.0%
50 Briar Hollow Lane, 7th Floor West
Houston, Texas 77027
</TABLE>
- -------------------------
(1) EHI Holdings, Inc. is a wholly-owned subsidiary of Seitel, Inc.
Prior to the Company's IPO in August 1997, the Company was a
wholly-owned subsidiary of Seitel, Inc. After the IPO and related transactions,
Seitel retained beneficial ownership of the Shares offered hereby, which shares
comprised approximately 17.7% of the outstanding stock of the Company as of July
31, 1998. Paul A. Frame, a director of the Company, is also the Chief Executive
Officer and President and a director of Seitel. The Selling Stockholder is a
wholly-owned subsidiary of Seitel.
Prior to the Company's IPO, Seitel provided the Company with
significant management functions and services, including treasury, accounting,
tax, audit, legal, human resources and other support services. The Company was
charged and/or allocated expenses of $818,000 for the period from January 1,
1997 to August 11, 1997, the date of consummation of the IPO. The costs of these
services were directly charged and/or allocated using methods the Company
believes were reasonable.
In addition, Seitel advanced expenses on behalf of the Company prior to
the IPO with respect to the Company's work for third-parties, including amounts
attributable to taxes and allocable overhead relating to such third-party work.
8
<PAGE> 10
Pursuant to the Master Separation Agreement described below, the Company repaid
Seitel $3,003,000, the amount of such advances relating to third-party work at
the time of closing of the IPO.
Seitel is a major customer of the Company. Prior to the IPO, revenues
for services provided by the Company to Seitel were based on prices charged to
unaffiliated third parties for similar work. The Company's revenues from work
performed for Seitel were $18.5 million for the period from January 1, 1997 to
August 11, 1997. These revenues included a profit. Prior to the consummation of
the IPO, the Company declared and paid a dividend to Seitel of its receivable
from Seitel for profits attributable to work performed for Seitel since
formation of the Company's predecessors to the closing of the IPO, less taxes
and allocable overhead attributable to such intercompany work. The amount of
such dividend was $6.7 million.
Prior to the IPO, a significant portion of the total seismic data
acquisition services performed by the Horizon Companies were provided to Seitel.
The Horizon Companies charged Seitel for these services at an amount believed by
management of the Horizon Companies to be equal to amounts it would have charged
unrelated third parties for such services. The revenues to the Horizon Companies
from work performed for Seitel were $15.5 million for the period from January 1,
1997 to August 11, 1997.
The Company and Seitel entered into a number of agreements for the
purpose of defining their continuing relationship after the Company's IPO. These
agreements were negotiated in the context of a parent-subsidiary relationship
and therefore were not the result of negotiations between independent parties.
The following is a summary of certain arrangements between the Company and
Seitel.
MASTER SEPARATION AGREEMENT. The Master Separation Agreement provided
for the Company and Seitel to enter into a Sublease, a Registration Rights
Agreement, a Tax Indemnity Agreement, an Employee Benefits Allocation Agreement
and an Administrative Services Agreement. In addition, the Master Separation
Agreement required the Company to repay $7.7 million of indebtedness owed by the
Company and its subsidiaries to Seitel (including $4.7 million payable to Seitel
from ERI, the parent corporation of the Horizon Companies) and to repay $16.7
million of indebtedness owed by the Company and its subsidiaries to third
parties guaranteed by Seitel (or obtain the release of Seitel's guaranty)
contemporaneously with the consummation of the IPO. The Company has repaid these
amounts as required by the Master Separation Agreement. Under the Master
Separation Agreement, Seitel and its subsidiaries and the Company and its
subsidiaries have agreed to indemnify each other with respect to liabilities
arising in connection with the operations of their respective businesses prior
to and after the date of the Company's IPO, including any liabilities under the
Securities Act with respect to the IPO. The Master Separation Agreement also
provides for continued access by the Company to historical financial and
operational information relating to the Company and its subsidiaries maintained
by Seitel.
SUBLEASE. The Sublease between the Company and Seitel provides for the
Company to lease its principal corporate offices, comprising approximately 7,600
square feet, from Seitel until August 15, 2000 at an annual rent of $85,000. The
Sublease also provides for the Company to utilize certain shared office
equipment, such as phone systems and central computer systems, for an additional
charge. The Company paid Seitel an aggregate amount of approximately $25,000
under the Sublease for the period from August 15, 1997 to December 31, 1997.
REGISTRATION RIGHTS AGREEMENT. Pursuant to the Registration Rights
Agreement, the Company has agreed to register the offer and sale by EHI
Holdings, Inc. ("EHI"), a wholly-owned subsidiary of Seitel, on a delayed and
continuous basis from time to time of the 1,520,000 Shares of Common Stock owned
by the Selling Stockholder at the expense of the Company. The Company has agreed
to file a shelf registration statement on or before August 20, 1998 and to use
its best efforts to secure the effectiveness of such shelf registration
statement as soon as possible thereafter. This Prospectus is a part of the
registration statement being filed by the Company pursuant to the Registration
Rights Agreement. EHI has agreed in the Registration Rights Agreement not to
sell more than 50% of such shares pursuant to such registration statement prior
to August 15, 1999. In addition, the Company has granted EHI the right to
participate as a selling stockholder in future underwritten public offerings of
the Company's Common Stock, subject to certain restrictions. The Company and EHI
have each agreed to indemnify the other against, or to contribute to any losses
arising out of, certain liabilities in connection with any such registration,
including liabilities under the Securities Act.
9
<PAGE> 11
TAX INDEMNITY AGREEMENT. Prior to the Company's IPO, the Company was a
member of the Seitel affiliated group and filed its tax returns on a
consolidated basis with such group. As a result of the IPO, the Company is no
longer a member of the Seitel affiliated group. The Company and Seitel have
entered into a Tax Indemnity Agreement to define their respective rights and
obligations relating to federal, state and other taxes for periods before and
after the IPO. Pursuant to the Tax Indemnity Agreement, the Company is required
to pay Seitel (to the extent not already paid) its share of federal income taxes
prior to the date of consummation of the IPO, and the Company is responsible for
federal income taxes from its operations on and after the date of consummation
of the IPO. Any subsequent refunds, additional taxes or penalties or other
adjustments relating to the Company's federal income taxes for periods prior to
the date of consummation of the IPO will be for the benefit of or be borne by
Seitel. Similar provisions apply under the Tax Indemnity Agreement to other
taxes, such as state and local income taxes.
EMPLOYEE BENEFITS ALLOCATION AGREEMENT. Seitel and the Company have
entered into an Employee Benefits Allocation Agreement pursuant to which the
Company has established its own 401(k) plan, into which Seitel has transferred
those assets that were held in Seitel's 401(k) plan for the benefit of Company
employees. Also pursuant to the Employee Benefits Allocation Agreement, the
Company has established its own health and disability insurance and related
plans to provide insurance coverage to Company employees. The Company assumed
all obligations of Seitel with respect to vacation and severance for Company
employees, and the parties have agreed to indemnify each other with respect to
their obligations under the Employee Benefits Allocation Agreement.
ADMINISTRATIVE SERVICES AGREEMENT. Seitel and the Company entered into
an Administrative Services Agreement pursuant to which Seitel provided the
Company with administrative services, primarily accounting services, for a
90-day transition period to allow the Company adequate time to build an internal
administrative staff. The Company paid Seitel an aggregate of $5,500 for these
services from August 11, 1997 until expiration of this agreement on November 9,
1997, which was Seitel's actual cost of providing these services to the Company.
In addition to the above-described transactions relating to periods
prior to the IPO and agreements relating to the separation of the Company from
Seitel, Seitel also continues to be a major customer of the Company's services.
From the date of the consummation of the IPO through December 31, 1997, the
Company's revenues attributable to work performed for Seitel was $15.7 million.
For the period from January 1, 1998 through June 30, 1998, the Company's
revenues attributable to work performed for Seitel was $32.5 million, and as of
June 30, 1998, the Company's backlog of work to be performed for Seitel totaled
approximately $79.2 million. The Company believes that the services provided to
Seitel since the date of the IPO are at prices equal to the prices the Company
would have charged unrelated third parties.
10
<PAGE> 12
PLAN OF DISTRIBUTION
The Selling Stockholder may from time to time sell all or any portion
of the Shares on the Nasdaq National Market or any other national securities
exchange on which the Common Stock is listed or traded, in negotiated
transactions, or a combination of such methods of sale, at fixed prices which
may be changed, at market prices prevailing at the time of sale, at prices
related to prevailing market prices or at negotiated prices. The Selling
Stockholder may effect such transactions by selling the Shares to or through
broker-dealers, and such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the Selling Stockholder and/or the
purchasers of the Shares for whom such broker-dealers may act as agents or to
whom they sell as principals, or both (which compensation as to a particular
broker-dealer might be in excess of customary commissions).
In order to comply with the securities laws of certain states, if
applicable, the Shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
Shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.
The Selling Stockholder and any broker-dealers or agents that
participate with the Selling Stockholder in the distribution of the Shares may
be deemed to be "underwriters" within the meaning of the Securities Act, and any
commissions received by them and any profit on the resale of the Shares
purchased by them may be deemed to be underwriting commissions or discounts
under the Securities Act.
Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the Shares may not simultaneously engage
in market making activities with respect to the Common Stock of the Company
during a period beginning one or five business days prior to the commencement of
such distribution. In addition and without limiting the foregoing, the Selling
Stockholder will be subject to applicable provisions of the Exchange Act and the
rules and regulations thereunder, including, without limitation, Rule 102, which
provisions may limit the timing of purchases and sales of shares of Common Stock
by the Selling Stockholder.
The Company will pay all costs and expenses incurred in connection with
the registration under the Securities Act of the Shares, including, without
limitation, all registration and filing fees, printing expenses and fees and
disbursements of counsel and accountants for the Company. The Selling
Stockholder will pay any brokerage fees and commissions, fees and disbursements
of legal counsel for the Selling Stockholder and stock transfer and other taxes
attributable to the sale of the Shares. The Company also has agreed to indemnify
the Selling Stockholder and its officers and directors and each person who
controls (within the meaning of the Securities Act) the Selling Stockholder
against certain losses, claims, damages and expenses arising under the
securities laws in connection with this offering. The Selling Stockholder has
agreed to indemnify the Company, its officers, directors and each person who
controls (within the meaning of the Securities Act) the Company against other
losses, claims, damages and expenses arising under the securities laws in
connection with this offering with respect to written information furnished to
the Company by the Selling Stockholder.
There is no assurance that the Selling Stockholder will sell any or all
of the Shares.
11
<PAGE> 13
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be
passed upon by Gardere Wynne Sewell & Riggs, L.L.P., 333 Clay Avenue, Suite 800,
Houston, Texas 77002.
EXPERTS
The audited consolidated financial statements incorporated by reference
in this Prospectus and in the Registration Statement have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their report with
respect thereto. In their report, that firm states that with respect to certain
subsidiaries its opinion is based on the reports of other independent public
accountants. The financial statements referred to above have been incorporated
by reference herein in reliance upon the authority of said firm as experts in
giving said report.
12
<PAGE> 14
================================================================================
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION
OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN CONNECTION
WITH THE OFFERING, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS
PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER
TO BUY, THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION WHERE, OR TO ANY
PERSON TO WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY
CIRCUMSTANCE CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS
OF THE COMPANY SINCE THE DATE HEREOF.
---------------------------
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
Available Information.............................2
Incorporation of Certain Documents By Reference...2
Risk Factors......................................3
The Company.......................................8
Use Of Proceeds...................................8
Selling Stockholder...............................8
Plan Of Distribution.............................11
Legal Matters....................................12
Experts ........................................12
</TABLE>
================================================================================
================================================================================
1,520,000 SHARES
EAGLE GEOPHYSICAL, INC.
COMMON STOCK
---------------------------
PROSPECTUS
---------------------------
, 1998
================================================================================
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the various expenses to be paid by the
Registrant in connection with the issuance and distribution of the shares of
Common Stock being registered. All amounts shown are estimates except for the
Securities and Exchange Commission registration fee. The Registrant will pay all
expenses in connection with the distribution of the shares of Common Stock being
sold by the Selling Stockholder (including fees and expenses of counsel for the
Company and the Selling Stockholder, and excluding any compensation due to any
broker or dealer in connection with the sale of any of the shares offered
hereby).
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee .... $ 4,400
Legal fees and expenses ................................ 3,000
Printing, EDGAR formatting and mailing expenses ........ 3,000
Accounting fees and expenses ........................... 3,000
Miscellaneous .......................................... 1,000
-------
Total ......................................... $14,400
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant is incorporated under the laws of Delaware. Section 145
of the Delaware General Corporation Law provides that a Delaware corporation may
indemnify any person against expenses, fines and settlements actually and
reasonably incurred by any such person in connection with a threatened, pending
or completed action, suit or proceeding in which he is involved by reason of the
fact that he is or was a director, officer, employee or agent of such
corporation, provided that (i) he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and (ii) with respect to any criminal action or proceeding, he had
no reasonable cause to believe his conduct was unlawful. If the action or suit
is by or in the name of the corporation, the corporation may indemnify any such
person against expenses actually and reasonably incurred by him in connection
with the defense or settlement of such action or suit if he acted in good faith
and in a manner he reasonably believed to be in or not opposed to the best
interest of the corporation, except that no indemnification may be made in
respect to any claim, issue or matter as to which such person shall have been
adjudged to be liable for negligence or misconduct in the performance of his
duty to the corporation, unless and only to the extent that the Delaware Court
of Chancery or the court in which the action or suit is brought determines upon
application that, despite the adjudication of liability but in light of the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses as the court deems proper.
As permitted by the Delaware General Corporation Law, the Registrants'
Certificate of Incorporation provides that the directors and officers of the
Registrant shall be indemnified by the Registrant against certain liabilities
that those persons may incur in their capacities as directors or officers. The
Certificate of Incorporation eliminates the liability of directors of the
Registrant, under certain circumstances, to the maximum extent permitted by the
Delaware General Corporation Law. Section 102(b)(7) of the General Corporation
Law of the State of Delaware provides that a certificate of incorporation may
contain a provision eliminating or limiting the personal liability of a director
to the corporation or its stockholders for monetary damages for a breach of
fiduciary duty as a director, provided that such provisions may not eliminate or
limit the liability of a director (i) for any breach of the director's duty of
loyalty to the corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 (relating to liability for unauthorized
acquisitions or redemptions of, or dividends on, capital stock) of the General
Corporation Law of the State of Delaware or (iv) for any transaction from which
the director derived an improper personal benefit. The Registrant's Certificate
of Incorporation contains such a provision.
<PAGE> 16
Additionally, pursuant to an employment agreement between Mr. Silverman
and the Registrant and an employment agreement between Mr. McNairy and the
Registrant, the Registrant shall, to the maximum extent not prohibited by law,
indemnify Mr. Silverman and Mr. McNairy if Mr. Silverman or Mr. McNairy is made,
or threatened to be made, a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, including an action by or in the right of the Registrant to
procure a judgment in its favor (collectively, a "Proceeding"), by reason of the
fact that Mr. Silverman or Mr. McNairy is or was a director or officer of the
Registrant, or is or was serving in any capacity at the request of the
Registrant for any other corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, against judgments, fines, penalties,
excise taxes, amounts paid in settlement and costs, charges and expenses
(including attorneys' fees and disbursements) paid or incurred in connection
with any such Proceeding. The Registrant anticipates that it may enter into
similar contractual indemnification arrangements with its other executive
officers and directors.
The above discussion of the Registrant's Certificate of Incorporation,
Bylaws, and employment agreements and of Sections 102(b)(7) and 145 of the
General Corporation Law of the State of Delaware is not intended to be
exhaustive and is qualified in its entirety by such Certificate of
Incorporation, Bylaws, employment agreements and statutes.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
<TABLE>
<S> <C> <C>
4.1 -- Certificate of Incorporation of the Registrant (incorporated by reference to the
Registrant's Registration Statement on Form S-1, Registration No. 333-28303 (the "IPO
Registration Statement")).
4.2 -- Bylaws of the Registrant (incorporated by reference to the IPO Registration Statement).
4.3 -- Amendment to Bylaws of the Registrant (incorporated by reference to the Registrant's
Quarterly Report on Form 10-Q for the quarterly ended March 31, 1998).
5.1 -- Opinion of Gardere Wynne Sewell & Riggs, L.L.P., regarding legality of securities.
23.1 -- Consent of Gardere Wynne Sewell & Riggs, L.L.P. (included in Exhibit 5.1).
23.2 -- Consent of Arthur Andersen LLP.
23.3 -- Consent of KPMG.
24.1 -- Powers of Attorney (included in the signature page).
</TABLE>
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement;
(i) To include any prospectus required to Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or to
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement; and
II-2
<PAGE> 17
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on Form S-3, Form S-8, or
Form F-3, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration, by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) of 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-3
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on the 20th day of August,
1998.
EAGLE GEOPHYSICAL, INC.
(Registrant)
By: /s/ JAY N. SILVERMAN
-------------------------------
Jay N. Silverman
President and Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Jay
N. Silverman and Richard W. McNairy true and lawful attorneys-in-fact and
agents, each acting alone, with full powers of substitution and re-substitution,
for him and in his name, place and stead, in any and all capacities, to sign any
and all amendments (including post-effective amendments) to this Registration
Statement, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, each acting alone, full powers and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, each acting alone, or his or her substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated below in the City of Houston, State of Texas on the dates
below.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
President, Chief Executive Officer
/s/ JAY N. SILVERMAN and Director (Principal Executive
------------------------ Officer)
Jay N. Silverman August 20, 1998
/s/ RICHARD W. MCNAIRY Vice President - Chief Financial
------------------------ Officer (Principal Financial Officer)
Richard W. McNairy August 20, 1998
/s/ DAVID H. SAINDON Controller
------------------------ (Chief Accounting Officer)
David H. Saindon August 20, 1998
/s/ WILLIAM L. LURIE Chairman of the Board and Director
------------------------
William L. Lurie August 20, 1998
/s/ GERALD M. HARRISON Executive Vice President and
------------------------ Director
Gerald M. Harrison August 20, 1998
/s/ GEORGE PURDIE Senior Vice President - Offshore
------------------------ Operations and Director
George Purdie August 20, 1998
/s/ PAUL A. FRAME Director
------------------------
Paul A. Frame August 20, 1998
/s/ PAUL G. SOMERVILLE Director
------------------------
Paul G. Somerville August 20, 1998
</TABLE>
II-4
<PAGE> 19
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
--- -----------
<S> <C> <C>
4.1 -- Certificate of Incorporation of the Registrant (incorporated by reference to the
Registrant's Registration Statement on Form S-1, Registration No. 333-28303 (the "IPO
Registration Statement")).
4.2 -- Bylaws of the Registrant (incorporated by reference to the IPO Registration Statement).
4.3 -- Amendment to Bylaws of the Registrant (incorporated by reference to the Registrant's
Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1998).
5.1 -- Opinion of Gardere Wynne Sewell & Riggs, L.L.P., regarding legality of securities.
23.1 -- Consent of Gardere Wynne Sewell & Riggs, L.L.P. (included in Exhibit 5.1).
23.2 -- Consent of Arthur Andersen LLP.
23.3 -- Consent of KPMG.
24.1 -- Powers of Attorney (included in the signature page).
</TABLE>
<PAGE> 1
Exhibit 5.1
[GARDERE WYNNE SEWELL & RIGGS, L.L.P. LETTERHEAD]
August 20, 1998
Eagle Geophysical, Inc.
50 Briar Hollow Lane, 6th Floor West
Houston, Texas 77057
Gentlemen:
As set forth in the Registration Statement (the "Registration Statement") on
Form S-3 to be filed by Eagle Geophysical, Inc., a Delaware corporation (the
"Company"), with the Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, as amended (the "Act"), relating to the registration
of 1,520,000 shares (the "Shares") of the Company's common stock, par value
$0.01 per share ("Common Stock"), to be sold by the stockholder listed in the
Registration Statement, certain legal matters in connection with the Common
Stock are being passed upon for the Company by us. This opinion is being
furnished to you in accordance with the requirements of Item 16 of Form S-3 and
Item 601(b)(5)(i) of Regulation S-K for filing as Exhibit 5.1 to the
Registration Statement.
In our capacity as your special counsel, we have examined the Certificate of
Incorporation and Bylaws of the Company and the originals, or copies certified
or otherwise identified, of corporate records of the Company, including minute
books of the Company as furnished to us by the Company, certificates of public
officials and of representatives of the Company, statutes and other instruments
and documents as a basis for the opinions hereinafter expressed. In giving such
opinions, we have relied upon certificates of officers of the Company with
respect to the accuracy of the material factual matters contained in such
certificates.
Based on the foregoing, and having regard for such legal considerations as we
have deemed relevant, we are of the opinion that the Shares have been duly
authorized, were validly issued and are fully paid and nonassessable.
The foregoing opinion is limited to the federal laws of the United States of
America and the General Corporation Law of the State of Delaware, and we are
expressing no opinion as to the effect of the laws of any other jurisdiction.
We hereby consent to the filing of this opinion with the Commission as an
exhibit to the Registration Statement and to the references to our Firm under
the caption "Legal Matters" in the Prospectus included in the Registration
Statement. In giving this consent, we do not thereby admit that we are within
the category of persons whose consent is required under Section 7 of the Act,
the rules and regulations of the Securities and Exchange Commission promulgated
thereunder, or Item 509 of Regulation S-K.
This opinion letter is rendered as the date first written above and we disclaim
any obligation to advise you of facts, circumstances, events or developments
which hereafter may be brought to our attention and which may alter, affect or
modify the opinion expressed herein. Our opinion is expressly limited to the
matters set forth above and we render no opinion, whether by implications or
otherwise, as to any other matters relating to the Company or the Shares.
Very truly yours,
GARDERE WYNNE SEWELL & RIGGS, L.L.P.
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated March 6, 1998
included in Eagle Geophysical, Inc.'s annual report on Form 10-K for the year
ended December 31, 1997, and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN LLP
Houston, Texas
August 20, 1998
<PAGE> 1
Exhibit 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated February 26, 1998
included in Eagle Geophysical, Inc.'s annual report on Form 10-K for the year
ended December 31, 1997, and to all references to our Firm included in this
registration statement.
KPMG
Plymouth, England
August 19, 1998
