Registration No. 33 --
As filed with the Securities & Exchange Commission on February 28, 1996
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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SEITEL, INC.
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(Exact name of registrant as specified in its charter)
Delaware 76-0025431
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
50 Briar Hollow Lane
West Building, 7th Floor
Houston, Texas 77027
(713) 627-1990
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(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
SEITEL, INC. 1993 INCENTIVE STOCK OPTION PLAN
SEITEL, INC. 1995 WARRANT RELOAD PLAN
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(Full Title of Plans)
Paul A. Frame, President
Seitel, Inc.
50 Briar Hollow Lane, West Building, 7th Floor
Houston, Texas 77027
(713) 627-1990
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(Name, address, including zip code, and telephone number,
including area code, of agent for service)
With copies to:
Debra D. Valice W. Mark Young, Esq.
Chief Financial Officer Gardere Wynne Sewell & Riggs, L.L.P.
Seitel, Inc. 333 Clay Avenue, Suite 800
50 Briar Hollow Lane Houston, Texas 77002
West Building, 7th Floor (713) 308-5500
Houston, Texas 77027
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<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Each Proposed Proposed
Class of Maximum (1) Maximum Amount of
Securities to Amount to be Offering Price Aggregate Registration
be Registered Registered (1) Per Unit Offering Price Fee
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<S> <C> <C> <C> <C>
Common
Stock, Par
Value $.01 Per
Share 2,051,122 $26.50 (2) $54,354,733 $18,750
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<FN>
(1) The aggregate number of securities registered hereunder is
2,051,122 shares of Common Stock which have been authorized and reserved for
issuance under the Company's 1993 Incentive Stock Option Plan and 1995 Warrant
Reload Plan. Pursuant to Rule 416 promulgated under the Securities Act of 1933,
as amended, this Registration Statement covers such additional shares of Common
Stock to be offered or issued to prevent dilution as a result of future stock
splits, stock dividends or similar transactions.
(2) The fee with respect to these shares has been calculated pursuant
to paragraphs (c) and (h) of Rule 457, upon the basis of $26.50, the average of
the high and low prices reported on the New York Stock Exchange on February 23,
1996 (being within five business days prior to the date of the filing of this
Registration Statement).
</FN>
</TABLE>
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<PAGE>
EXPLANATORY NOTE
This Registration Statement contains two parts: the first part contains
a Prospectus on Form S-3 (in accordance with Section C of the General
Instructions to Form S-8) which covers re-offers and re-sales by the Selling
Stockholders listed, from time to time, in the Prospectus of shares of Common
Stock of the Company to be issued upon exercise of options granted under the
Company's 1993 Incentive Stock Option Plan and upon exercise of warrants granted
under the 1995 Warrant Reload Plan.
The second part contains information required in the Registration
Statement pursuant to Part II of Form S-8.
Pursuant to Note to Part I of Form S-8, the Plan Information specified
by Part I is not being filed with the Securities and Exchange Commission, as
such information will be sent or given to each employee participant in
accordance with Rule 428 under the Securities Act of 1933, as amended (the
"Act"). This information and the documents incorporated by reference into this
Registration Statement pursuant to Item 3 of Part II of this Registration
Statement, taken together, constitute a prospectus that meets the requirements
of Section 10(a) of the Act.
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<PAGE>
PROSPECTUS SEITEL, INC.
(Form S-3)
2,051,122 Shares
Common Stock
($.01 Par Value Per Share)
--------------------------------
1993 INCENTIVE STOCK OPTION PLAN
1995 WARRANT RELOAD PLAN
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This Prospectus is being used in connection with the offering, from
time to time, by certain stockholders (the "Selling Stockholders") of Seitel,
Inc. (the "Company") of shares of common stock, $.01 par value per share (the
"Common Stock") which have been or may be acquired upon exercise of options
granted under the 1993 Incentive Stock Option Plan (the "Option Plan") and
warrants granted under the 1995 Warrant Reload Plan (the "Reload Plan").
The securities being registered hereby (the "Securities") may be sold,
from time to time, by the Selling Stockholders, directly or indirectly, through
agents designated from time to time, in one or more open market transactions,
including block trades, on the New York Stock Exchange, in privately negotiated
transactions, or in a combination of such methods of sale. Such sales may be
made through dealers or underwriters to be designated, on terms to be determined
at the time of sale, or at prices and at terms then prevailing or at prices
related to the then current market price. In effecting sales, brokers or dealers
engaged by the Selling Stockholders may arrange for other brokers or dealers to
participate. Brokers or dealers will receive commissions or discounts from
Selling Stockholders in amounts to be negotiated immediately prior to the sale.
Such brokers or dealers and any other participating brokers or dealers may be
deemed to be "underwriters" within the meaning of the Securities Act of 1933, as
amended (the "Act"), in connection with such sales. To the extent required, the
specific securities sold, the name of the Selling Stockholders, the purchase
price, public offering price, name of any such agent, dealer or underwriter, and
any applicable discount or commission with respect to a particular offer will be
set forth by supplement to this Prospectus. In addition, any securities covered
by this Prospectus which qualify for sale pursuant to Rule 144 may be sold under
Rule 144 rather than pursuant to this Prospectus. The Company will not receive
any of the proceeds from the sale of these shares, but will receive the
aggregate exercise price of options exercised under the Option Plan and warrants
exercised under the Reload Plan. The Company's Common Stock is presently listed
on the New York Stock Exchange under the symbol "SEI." The closing price for the
Common Stock on the New York Stock Exchange on February 23, 1996, was $26.625.
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SEE "RISK FACTORS" FOR CERTAIN MATTERS
TO BE CONSIDERED BY PROSPECTIVE INVESTORS
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The date of this Prospectus is February 28, 1996.
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<PAGE>
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
--------------------------------
No person is authorized in connection with the offering made by this
Prospectus to give any information or to make any representations not contained
or incorporated by reference in this Prospectus, and any information or
representation not contained or incorporated by reference in this Prospectus
must not be relied upon as having been authorized by the Company. This
Prospectus is not an offer to sell, or a solicitation of an offer to buy, by any
person in any jurisdiction in which it is unlawful for that person to make an
offer or solicitation. Neither the delivery of this Prospectus or any sale made
under this Prospectus shall, under any circumstance, create any implication that
the information in this Prospectus is correct as of any time subsequent to the
date of this Prospectus.
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AVAILABLE INFORMATION
Seitel, Inc. (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 reports, proxy and information
statements and other information with the Securities and Exchange Commission
(the "Commission"). Such reports, proxy and information statements and other
information can be inspected and copied at the public reference facilities
maintained by the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549; Northwestern Atrium Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661; and 7 World Trade Center, New York, New
York 10048. Copies of such material can be obtained from the Public Reference
Section of the Commission, in Washington, D.C. at prescribed rates. In addition,
the Company's Common Stock is listed on the New York Stock Exchange, 20 Broad
Street, New York, New York 10005, and reports, proxy and information statements
and other information can be inspected at the offices of the Exchange.
The Company has filed with the Commission a Registration Statement
under the Securities Act of 1933, as amended, with respect to the securities
offered by this Prospectus. This Prospectus does not contain all of the
information set forth in the Registration Statement, certain parts of which are
omitted in accordance with the rules and regulations of the Commission.
Additional information concerning the securities offered hereby is to be found
in the Registration Statement, including various exhibits thereto, which may be
inspected at the Commission's office in Washington, D.C.
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<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates by reference into this Prospectus the
following documents and portions of documents:
1. The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994, as amended by Form 10-K/A dated April 28, 1995.
2. The Company's Quarterly Reports on Form 10-Q for the fiscal quarters
ended March 31, June 30, and September 30, 1995.
3. The Company's Current Report on Form 8-K dated January 2, 1996.
4. All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act, since December 31, 1994.
5. The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, dated March 27, 1991 (Registration
Number 0-14488).
6. All other reports filed pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus prior to the
termination of this offering.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon written or oral request of that person, a copy of
all other documents incorporated by reference into the Registration Statement of
which this Prospectus is a part, other than exhibits to those documents.
Requests should be directed to Debra D. Valice, Seitel, Inc., 50 Briar Hollow
Lane, West Building, 7th Floor, Houston, Texas 77027 (telephone: (713)
627-1990).
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<PAGE>
THE COMPANY
The Company and its subsidiaries (the "Company"), located in Houston,
Texas, are a leading provider of seismic data and related geophysical services
and expertise to the petroleum industry. The Company has evolved into a
diversified energy concern with several niche operations, including one of the
largest independent seismic data libraries in the United States;
three-dimensional seismic data acquisition, processing and interpretation
technology; direct participation in exploration, development and ownership of
natural gas and crude oil reserves; and natural gas marketing.
Since its inception in 1982, the Company has been engaged in the
development of a proprietary library of seismic data, created by both the
Company and others. The Company's seismic data library is owned and marketed by
Seitel Data, Ltd., a Texas limited partnership of which wholly-owned Seitel
subsidiaries constitute all of the limited and general partners. Seitel Data,
Ltd. markets the data library, which consists of both two-dimensional ("2D") and
three-dimensional ("3D") data, to oil and gas companies under license
agreements. Seismic surveys and the analysis of seismic data for the
identification and definition of underground geological structures are principal
techniques used in oil and gas exploration and development to determine the
existence and location of subsurface hydrocarbons.
Through its wholly-owned subsidiary, Seitel Geophysical, Inc., the
Company commenced 3D seismic recording and crew operations in June, 1993. The
Company utilizes 1300-channel telemetric systems to record the 3D surveys that
the Company is conducting in the difficult marsh/swamp and transition-zone areas
onshore in the U.S. Gulf Coast region. Most seismic recording equipment use
cables to transmit data and do not operate as efficiently in wetland areas as
telemetry-based seismic systems like those used by the Company, which use radio
signals for data transmission. In February, 1994, the Company added an in-house
seismic data processing center in order to accommodate the Company's 3D surveys.
This processing center, located at the Company's Houston headquarters, features
sophisticated computer hardware and software designed specifically to process 3D
seismic data. The Company's integrated operations include its large 2D seismic
library, seismic recording systems and crews geared specifically to conduct 3D
surveys, the seismic data processing center and computer software, and the
Company's geophysical application experience in interpreting 3D data.
In March, 1993, the Company formed DDD Energy, Inc. ("DDD Energy"), a
wholly-owned subsidiary, to participate directly in petroleum exploration,
development and ownership of hydrocarbon reserves through cost and revenue
sharing relationships with oil and gas producers. The Company's objective is to
participate through DDD Energy in exploration and development programs which
combine the Company's 3D and 2D seismic resources and related geophysical
technologies with the geology and engineering expertise and land positions of
selected petroleum producers.
In the fall of 1993, the Company entered the gas marketing field
through the formation of Seitel Gas & Energy Corp. ("SG&E"), a wholly-owned
subsidiary of the Company. SG&E was formed to provide large-volume consumers of
natural gas with cost savings as compared with rates charged by local utilities,
as well as flexible sources of supply and other benefits and services tailored
to end-users' respective usage requirements.
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RISK FACTORS
Prospective purchasers of the Common Stock should carefully consider,
in addition to the other information contained in this Prospectus and any
accompanying Prospectus Supplement, the following risk factors.
Competition. Competition in the Company's various businesses is
intense. In the seismic data acquisition and resale industry, several other
independent oil-service companies create and market seismic data, and numerous
oil and gas companies create seismic data and maintain their own seismic data
banks. Due to difficult industry conditions since the late 1980's, the number of
independent seismic companies has decreased, and oil and gas companies have
acquired an increasing portion of their seismic data from outside sources,
including the Company. In the oil and gas exploration and production business,
there are numerous oil and gas companies competing for the acquisition of
mineral properties. In the gas marketing field there are numerous companies
competing for customers. Although the Company has significant operating history
in its seismic data licensing operations, it has limited operating history in
seismic data acquisition, oil and gas exploration, and gas marketing. Some of
the Company's competitors have longer operating histories, greater financial
resources and larger sales volumes than the Company. Although the Company
believes that its fully-integrated seismic resources and technical, geophysical
and marketing expertise will allow it to compete effectively in the seismic data
industry, the oil and gas exploration and development industry, and the natural
gas marketing industry, there can be no assurance that this will be the case.
Industry Conditions. Demand for the Company's seismic data services
depends primarily upon the level of spending by oil and gas companies for
exploration, production and development activities. These spending levels tend
to increase and decrease with increases and decreases in the commodity prices
for oil and gas, so that demand for the Company's seismic data services is
affected to some degree by market prices for natural gas and crude oil, which
have historically been very volatile. Revenues generated by the Company's oil
and gas exploration and development business increase and decrease with
increases and decreases in the market prices of oil and gas. Revenues generated
by the Company's gas marketing business depend on natural gas prices and usage
levels. A substantial or extended decline in oil and gas prices could have a
material adverse effect on the Company's financial position. In addition, if oil
and gas prices decrease materially, the Company may be unable to find partners
willing to pay the relatively high costs of exploration and development and
grant the Company an interest in production in exchange for seismic data.
Further, as high quality 3D data becomes more widely available from other
sources, the Company may be unable to obtain the same level of working interests
in oil and gas properties in exchange for use of its 3D data. Also, other
factors beyond the Company's control may affect its oil and gas operations.
These factors include the level of supply of natural gas and oil, the
availability of adequate pipeline and other transportation and processing
facilities and the marketing of competitive fuels. See also "Compliance with
Governmental Regulations."
Operating Risks. The Company's seismic data acquisition activities are
subject to the general risks incident to land seismic data acquisition
activities, including the use of explosives, which subject personnel to risk of
injury due to accidental explosions resulting from the mishandling of equipment
and supplies, and environmental claims. The Company operates in areas of
difficult terrain, such as in marshes and swamps, that can pose risks to
personnel and
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equipment. The Company has not experienced any material losses or environmental
claims to date, but there can be no assurance that it will not experience such
losses or claims in the future. To the extent available, the Company maintains
general liability insurance coverage against these potential claims, the nature
and amount of which the Company believes to be customary in the industry. There
can be no assurance that adequate insurance will be available in the future, or
that the Company will be able to maintain adequate insurance on terms and
conditions it finds acceptable.
The Company's oil and gas operations are subject to hazards incident to
the drilling of oil and gas wells, such as cratering, explosions, uncontrollable
flows of oil, gas or well fluids, fires, pollution, or other environmental
risks, as well as to the risk that no commercially producible natural gas or oil
reserves will be encountered. Some of these hazards can cause personal injury
and loss of life, severe damage to and destruction of property and equipment,
environmental damage and suspension of operations. In addition, the cost of
drilling, completing and operating wells is often uncertain, and drilling
operations may be curtailed, delayed or cancelled as a result of a variety of
factors, including unexpected drilling conditions, pressure or irregularities in
formations, equipment failures or accidents, weather conditions and shortages or
delays in the delivery of equipment. These risks are typically shared by the
Company and its petroleum company partners. The Company also seeks to reduce dry
hole risks by utilizing 3D seismic data, where deemed appropriate, to assist in
the determination of where to drill. Since the Company does not act as operator
in its oil and gas drilling business, it is dependent upon its petroleum company
partners to conduct operations in a manner so as to minimize these operating
risks. In accordance with industry practice, the Company maintains insurance
against some, but not all, of these operating risks. There can be no assurance
that adequate insurance will be available in the future, or that the Company
will be able to maintain adequate insurance on terms and conditions it finds
acceptable. As a result of the risks inherent in oil and gas operations, there
can be no assurance as to the success of the Company's oil and gas exploration,
development and production activities.
Holding Company Structure. The Company has no operations or significant
assets other than through its ownership of the capital stock of its
subsidiaries. Dividends and other permitted payments from such subsidiaries will
be the primary source of funds to pay dividends on the Common Stock. The rights
of the Company and its creditors to participate in the assets of any subsidiary
upon the latter's liquidation or reorganization will be subject to the prior
claims of the subsidiary's creditors except to the extent that the Company may
itself be a creditor with recognized claims against the subsidiary.
Dependence on Key Personnel. The Company's operations are dependent
upon a relatively small group of management and technical personnel. The loss of
one or more of these individuals could have a material adverse effect on the
Company. The Company utilizes equity ownership and other incentives to attract
and retain its employees. In addition, the Company's President and Chief
Executive Officer, Paul A. Frame, Executive Vice President and Chief Operating
Officer, Horace A. Calvert, and Senior Vice President of Finance and Chief
Financial Officer, Debra D. Valice, all have employment agreements with the
Company.
Geographic Concentration of Operations. Most of the Company's seismic
data in its seismic data library, as well as most of the Company's existing
interests in oil and gas properties, are located along the coast and offshore in
the U.S. Gulf of Mexico. Because of this
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concentration, any regional events that increase costs, reduce availability of
equipment or supplies, reduce demand or limit production will impact the Company
more adversely than if the Company were geographically diversified.
Compliance with Governmental Regulations. The oil and gas industry, in
general, is subject to extensive governmental regulation, which may be changed
from time to time in response to economic or political conditions. In
particular, oil and gas exploration and production is subject to federal and
state regulations governing environmental quality and pollution control, state
limits on allowable rates of production by well or proration unit, and other
similar regulations. State and federal regulations generally are intended to
prevent waste of natural gas and oil, protect rights to produce natural gas and
oil between owners in a common reservoir, control the amount of natural gas and
oil produced by assigning allowable rates of production, and control
contamination of the environment. Also, the Company believes that the trend
toward more expansive and stricter environmental laws and regulations will
continue. The implementation of new, or the modification of existing, laws or
regulations affecting the oil and gas industry could have a material adverse
impact on the Company.
Shares Eligible for Future Sale. No prediction can be made as to the
effect, if any, that future sales of shares of the Company's capital stock, or
the availability of shares of capital stock for future sale, will have on the
market price of such stock prevailing from time to time. The Company is
authorized to issue 20,000,000 shares of Common Stock, par value $.01 per share,
of which 9,469,128 shares are outstanding as of February 23, 1996. In addition,
as of February 23, 1996, the Company has outstanding the following securities
which are convertible into Common Stock, which are held by or issuable pursuant
to options, warrants and other rights granted prior to the date hereof and
exercisable within 60 days of the date hereof, and are eligible for sale
currently or immediately upon exercise:
(i) $1,696,000 Principal Amount 9% Convertible Subordinated
Debentures due March 31, 2002, convertible at $9.28 per share, which
debentures have been called for redemption on March 31, 1996, and can
be converted on or prior to March 25, 1996;
(ii) Common Stock Purchase Warrants to purchase an aggregate
of 1,790,479 shares of Common Stock with various exercise prices and
maturities; and
(iii) Options to purchase up to 640,045 shares of Common Stock
under the Company's 1993 Incentive Stock Option Plan, 1984 Incentive
Employee Stock Option Plan, Non-Employee Directors Stock Option Plan,
and Non-Qualified Stock Option Plans.
In addition, the Company's Board of Directors has the ability to issue
from time to time up to 5,000,000 shares of Preferred Stock, in one or more
series, with such dividend, liquidation, conversion, sinking fund, redemption,
preference and, subject to certain limitations, voting rights, as the Board, in
its discretion, may determine. As of the date of this Prospectus, no shares of
preferred stock are outstanding.
Sales of substantial amounts of Common Stock (including shares issued
upon the exercise of stock options or warrants), or the perception that such
sales could occur, could adversely affect prevailing market prices for the
Common Stock.
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<PAGE>
USE OF PROCEEDS
The Company will not receive any part of the proceeds from the sale of
the shares of Common Stock by the Selling Stockholders. The Company will,
however, receive the exercise price of options granted under the Option Plan
($8,291,250 if all of the currently outstanding options for shares registered
hereunder are exercised) and warrants granted under the Reload Plan upon
exercise thereof, which options or warrants must be exercised before the Selling
Stockholders can sell the shares offered hereunder. The exercise price of the
options and warrants is determined at the time of grant of such options or
warrants. The Company intends to use the proceeds from the exercise of the
options and warrants for general corporate purposes.
COMMON STOCK OFFERED BY THE SELLING STOCKHOLDERS
This Prospectus covers offers, from time to time, of a total of
2,051,122 shares of Common Stock held or to be held by the employees of the
Company pursuant to the Company's (i) recently adopted amendments to the Option
Plan, under which amendments an additional 405,000 shares, which are registered
hereunder, have been reserved for issuance to employees of the Company upon
exercise of options granted under the Option Plan, and (ii) Reload Plan, under
which warrants to purchase up to a total of up to 1,646,122 shares of Common
Stock may be granted to employees of the Company.
SELLING STOCKHOLDERS
1993 Incentive Stock Option Plan. As originally adopted in 1993, the
Option Plan provided for the Company to grant options to purchase up to 295,000
shares of the Company's Common Stock. These 295,000 shares have previously been
registered on a Registration Statement on Form S-8, Registration No. 33-78560,
filed with the Commission on May 5, 1994. Effective May 12, 1995, the Company
amended the Option Plan to increase the number of shares for which options could
be granted under the Option Plan by 405,000 shares, so that options to purchase
up to an aggregate of 700,000 shares of Common Stock of the Company may now be
granted under the Option Plan. This Prospectus may be used by employees of the
Company who are deemed to be affiliates of the Company under the Act for the
resale of any of such 405,000 shares of Common Stock issued to them upon
exercise of options granted under the Option Plan. As of February 28, 1996,
options to purchase 305,000 of these 405,000 shares had been granted under the
Option Plan. If and when any of the balance of these 405,000 shares of Common
Stock are issued upon exercise of options granted under the Option Plan and are
sought to be offered for resale by the Selling Stockholders, the number of
shares of Common Stock beneficially owned by each Selling Stockholder, the
number of shares acquired upon exercise of such options granted under the Option
Plan and the number of shares offered for resale pursuant to this Prospectus
will be indicated by Prospectus Supplement.
1995 Warrant Reload Plan. This Prospectus may be used by employees of
the Company who are deemed to be affiliates of the Company under the Act for the
resale of shares of Common Stock issued to them upon exercise of the warrants
granted under the 1995 Warrant Reload Plan.
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Selling Stockholders. The following table sets forth (i) the name and
relationship to the Company of each such Selling Stockholder, (ii) the number of
shares of Common Stock and the percentage of the outstanding Common Stock which
each such Selling Stockholder owned as of February 23, 1996, including shares
which may be acquired within 60 days upon the exercise of outstanding options
and warrants, (iii) the number of shares which may be acquired upon the exercise
of previously granted options under the Option Plan and offered hereby, and (iv)
the number of shares which may be acquired under the 1995 Warrant Reload Plan
and offered hereby.
All information set forth below has been furnished to the Company by
the Selling Stockholders and other sources which the Company has not verified.
Because the Selling Stockholders may sell all or a part of the Securities they
hold pursuant to this Prospectus, or any supplement thereto, and the fact that
this offering is not being underwritten on a firm commitment basis, no estimate
can be given as to the amount of Securities that will be held by the Selling
Stockholders upon termination of this offering.
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<TABLE>
<CAPTION>
Number of Shares
Issuable Under Number of Shares
Percentage Options Previously Issuable Under
Shares Owned Owned as of Granted Under Warrant Reload
As of February February 23, Option Plan and Plan and Offered
Name and Relationship 23, 1996(1) 1996(1) Offered Hereunder Hereunder
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Horace A. Calvert(2) 535,976 5.4% 50,000 345,399
Executive Vice President
President - DDD Energy, Inc.
Walter M. Craig, Jr.(3) 30,981 * 0 30,652
Director
Paul A. Frame(4) 517,378 5.3% 50,000 345,399
President
Jay M. Green(5) 61,970 * 15,000 24,271
Vice President - Investor Relations
Marcia H. Kendrick(6) 9,235 * 15,000 952
Chief Accounting Officer
David S. Lawi(7) 254,576 2.6% 25,000 202,863
Chairman of the Executive Committee
Jesse R. Marion(8) 42,938 * 25,000 10,577
President - Seitel Delaware, Inc. and
Seitel Data, Ltd.
Herbert M. Pearlman(9) 369,719 3.8% 50,000 245,291
Chairman of the Board
Jay N. Silverman(10) 45,629 * 25,000 3,282
President - Seitel Geophysical, Inc.
Debra D. Valice(11) 149,546 1.6% 25,000 78,666
Senior Vice President of Finance,
Treasurer and Secretary
David A. Wegner(12) 89,417 * 25,000 80,627
President - Seitel Gas & Energy Corp.
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* less than 1%
<FN>
(1) Includes shares that may be acquired within 60 days upon exercise of
outstanding options and warrants.
(2) Calvert: Includes 23,002 and 355,023 shares which may be acquired from the
Company within 60 days upon exercise of options and common stock purchase
warrants, respectively. The exercise prices of the options range from $2.80 to
$5.57 per share, and the exercise prices of the warrants range from $11.25 to
$24.00 per share.
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(3) Craig: Includes 30,652 shares which may be acquired from the Company within
60 days upon exercise of common stock purchase warrants. The exercise prices of
the warrants range from $30.13 to $32.00 per share.
(4) Frame: Includes 21,719 and 345,399 shares which may be acquired from the
Company within 60 days upon exercise of options and common stock purchase
warrants, respectively. The exercise prices of the options range from $3.11 to
$5.57 per share, and the exercise prices of the warrants range from $13.05 to
$24.00 per share.
(5) Green: Includes 20,000 and 24,271 shares which may be acquired from the
Company within 60 days upon exercise of options and common stock purchase
warrants, respectively. The exercise prices of the options range from $7.88 to
$40.00 per share, and the exercise prices of the warrants range from $5.38 to
$24.00 per share.
(6) Kendrick: Includes 6,667 and 952 shares which may be acquired from the
Company within 60 days upon exercise of options and common stock purchase
warrants, respectively. The exercise price of the options is $7.88 per share,
and the exercise price of the warrants is $24.00 per share.
(7) Lawi: Includes 202,863 shares which may be acquired from the Company within
60 days upon exercise of common stock purchase warrants. The exercise price of
the warrants range from $13.05 to $32.00 per share.
(8) Marion: Includes 17,083 and 10,577 shares which may be acquired from the
Company within 60 days upon exercise of options and common stock purchase
warrants, respectively. The exercise prices of the options range from $5.38 to
$30.00 per share, and the exercise price of the warrants is $24.00 per share.
(9) Pearlman: Includes 245,291 shares which may be acquired from the Company
within 60 days upon exercise of common stock purchase warrants. The exercise
prices of the warrants range from $13.05 to $32.00 per share.
(10) Silverman: Includes 30,531 and 3,282 shares which may be acquired from the
Company within 60 days upon exercise of options and common stock purchase
warrants, respectively. The exercise prices of the options range from $5.38 to
$30.00 per share, and the exercise price of the warrants is $24.00 per share.
(11) Valice: Includes 9,844 and 83,512 shares which may be acquired from the
Company within 60 days upon exercise of options and common stock purchase
warrants, respectively. The exercise prices of the options range from $5.57 to
$11.30 per share, and the exercise prices of the warrants range from $11.25 to
$24.00 per share.
(12) Wegner: Includes 8,790 and 80,627 shares which may be acquired from the
Company within 60 days upon exercise of options and common stock purchase
warrants, respectively. The exercise prices of the options range from $7.88 to
$11.30 per share, and the exercise price of the warrants is $31.60 per share.
</FN>
</TABLE>
14
<PAGE>
PLAN OF DISTRIBUTION
All Securities covered by this Prospectus are being offered for the
accounts of the Selling Stockholders. The Securities may be sold, from time to
time, in one or more transactions at a fixed offering price, which may be
changed, at varying prices determined at the time of sale, at terms then
prevailing or at prices related to the then current market price or at
negotiated prices. The Securities may be sold in one or more open market
transactions on the New York Stock Exchange or in privately negotiated
transactions. The Securities may be sold by various methods, including, but not
limited to, one or more of the following: (a) a block trade in which the broker
or dealer so engaged will attempt to sell Securities as agent but may position
and resell a portion of the block as principal to facilitate the transaction,
(b) purchases by a broker or dealer as principal and resale by the broker or
dealer for its own account pursuant to this Prospectus, (c) a transaction on the
New York Stock Exchange in accordance with the rules of such exchange, and (d)
ordinary brokers transactions and transactions in which the broker solicits the
purchasers. Alternatively, the Selling Stockholder may from time to time offer
the securities through underwriters, dealers or agents who may receive
compensation in the form of underwriting discounts, concessions, or commissions
from the Selling Stockholders and/or purchasers of Securities for whom they act
as agents. In addition, any of the Securities which qualify for sale pursuant to
Rule 144 under the Act, or otherwise pursuant to an applicable exemption under
the Act, may be sold other than pursuant to this Prospectus.
The Selling Stockholders and any such underwriters, dealers or agents
that participate in the distribution of Securities may be deemed to be
underwriters, and any profit on the sale of the Securities by them and any
discounts, commissions or concessions received by them may be deemed to be
underwriting discounts and commissions under the Act. Brokers or dealers acting
in connection with the sale of the Securities contemplated by this Prospectus
may receive commissions in connection therewith.
At the time a particular offer of Securities is made, to the extent
required, a supplement to this Prospectus will be distributed which will
identify the Selling Stockholders, identify and set forth the aggregate amount
of Securities being offered and the terms of the offering, including the name or
names of any underwriters, dealers or agents, the purchase price paid by any
underwriter for Securities purchased from the Selling Stockholder, any
discounts, commissions and other items constituting compensation from the
Selling Stockholder and any discounts, commissions or concessions allowed or
re-allowed or paid to dealers, including the proposed selling price to the
public. Such supplement to this Prospectus and, if necessary, a post-effective
amendment to the Registration Statement of which the Prospectus is a part, will
be filed with the Commission to reflect the disclosure of additional information
with respect to the distribution of the Securities. The Company will pay all of
the expenses incident to the registration and certain other expenses related to
this offering of the Securities, other than underwriting commissions and
discounts, normal commission expenses and brokerage fees, applicable transfer
taxes and attorneys' fees of Selling Stockholders' counsel.
The Selling Stockholders have entered into indemnification agreements
with the Company pursuant to which the Company will be indemnified against
failure by the Selling Stockholders to deliver a Prospectus if required, as well
as against certain civil liabilities, including liabilities under the Act or the
Exchange Act, incurred in connection with any untrue (or alleged untrue)
statement of a material fact or omission of a material fact in this Registration
Statement to the
15
<PAGE>
extent such liability relates to information supplied by the Selling Stockholder
for inclusion in the Registration Statement or Prospectus.
In order to comply with certain states' securities laws, if applicable,
the Securities will be sold in such jurisdictions only through registered or
licensed brokers or dealers. In certain states, the Securities may not be sold
unless the Securities have been registered or qualify for sale in such state, or
unless an exemption from registration or qualification is available and is
obtained.
LEGAL MATTERS
The validity of the Shares will be passed upon for the Company by
Gardere Wynne Sewell & Riggs, L.L.P., Houston, Texas.
EXPERTS
The consolidated financial statements of the Company and its
subsidiaries incorporated by reference from the Company's Annual Report on Form
10-K for the year ended December 31, 1994, have been audited by Arthur Andersen
LLP, independent public accountants, as indicated in their report with respect
thereto, and are incorporated herein in reliance upon the authority of said firm
as experts in accounting and auditing in giving said report.
The estimate of natural gas reserves contained in the Company's Annual
Report on Form 10-K for the year ended December 31, 1994, was obtained from
reserve reports dated January 1, 1995, prepared by Forrest A. Garb & Associates,
Inc., and are incorporated herein in reliance upon the authority of said firm as
experts in such matters.
16
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3: Incorporation of Documents by Reference. The Company incorporates
by reference into this Registration Statement the following documents which have
been or will be filed by the Company with the Securities and Exchange Commission
(the "Commission"):
1. The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1994, as amended by Form 10-K/A dated April
28, 1995.
2. The Company's Quarterly Reports on Form 10-Q for the fiscal
quarters ended March 31, June 30, and September 30, 1995.
3. The Company's Current Report on Form 8-K dated January 2,
1996.
4. All other reports filed pursuant to Section 13(a) or 15(d) of
the Securities Act of 1934, as amended (the "Exchange Act"),
since December 31, 1994.
5. The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, dated March 27,
1991 (Registration Number 0-14488).
In addition, all documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing
of a post-effective amendment which indicates that all securities offered have
been sold or which de-registers all securities then remaining unsold, shall be
deemed to be incorporated by reference in this Registration Statement and to be
a part hereof from the date of filing of such documents.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute part of this Prospectus.
Item 4: Description of Securities. Not applicable.
Item 5: Interests of Named Experts and Counsel. Not applicable.
Item 6: Indemnification of Directors and Officers. Section 145(a) of the
General Corporation Law of the State of Delaware (the "General Corporation Law")
provides, in general, that a corporation shall have the power to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the corporation), by reason of the fact that he is or was a director or
officer of the corporation. Such indemnity may be against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred in connection with such action, suit
17
<PAGE>
or proceeding, if the indemnitee acted in good faith and in a manner reasonably
believed to be in or not opposed to the best interests of the corporation and,
with respect to any criminal action or proceeding, the indemnitee must not have
had reasonable cause to believe his conduct was unlawful.
Section 145(b) of the General Corporation Law provides, in general,
that a corporation shall have the power to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he is or was a director or
officer of the corporation against expenses (including attorneys' fees) 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;
provided, however, that if the person is found to be liable to the corporation,
no indemnification shall be made except to the extent that the court determines
that indemnification is fair and reasonable under the circumstances.
Section 145(g) of the General Corporation Law provides, in general,
that a corporation shall have power to purchase and maintain insurance on behalf
of any person who is or was a director or officer of the corporation against any
liability asserted against him or incurred by him in any capacity, or arising
out of his status as such, whether or not the corporation would have the power
to indemnify him against such liability under the provisions of the law.
Article Eighth of the Registrant's Certificate of Incorporation and
Section Six of the Registrant's Bylaws give a director or officer the right to
be indemnified by the Registrant to the fullest extent permitted under Delaware
law.
Item 7: Exemption From Registration Claimed. Not Applicable.
Item 8: Exhibits:
4.1 Form of Warrant granted under the 1995 Warrant Reload Plan. *
5.1 Opinion of Sewell & Riggs, P.C., legal counsel to the
Company. *
10.1 Seitel, Inc. 1993 Incentive Stock Option Plan (incorporated by
reference to the Company's Quarterly Report on Form 10-Q for
the fiscal quarter ended June 30, 1993).
10.2 Seitel, Inc. Amendments to 1993 Incentive Stock Option Plan
effective May 12, 1995 (incorporated by reference to the
Company's Quarterly Report on Form 10- Q for the fiscal
quarter ended June 30, 1995).
23.1 Consent of Arthur Andersen LLP *
23.2 Consent of Forrest A. Garb & Associates, Inc. *
23.3 Consent of Sewell & Riggs, P.C. (included in Exhibit 5.1).
18
<PAGE>
24.1 Power of Attorney (included on Signature Page).
* filed herewith
Item 9: Undertakings. The Company hereby undertakes:
(1) to file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement 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.
(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.
The Company hereby undertakes that, for the purposes of determining any
liability under the Securities Act of 1933, each filing of the Company's annual
report pursuant to Section 13(a) or 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.
Insofar as indemnification of liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to the foregoing provisions, or otherwise, the Company has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in said Act and is
therefore unenforceable. In the event that a claim for an indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company in
a 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 Company 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 said Act and will be governed by the final adjudication
of such issue.
19
<PAGE>
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-8 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 this 28th day of
February, 1996.
SEITEL, INC.
BY: /s/Paul A. Frame
-------------------------------
PAUL A. FRAME, President, Chief
Executive Officer and Director
(principal executive officer)
BY: /s/Debra D. Valice
-------------------------------
DEBRA D. VALICE, Senior Vice
President of Finance, Chief Financial
Officer and Director
(principal financial and accounting
officer)
20
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following individuals in the
capacities and on the date indicated. Each person whose signature appears below
constitutes and appoints Paul A. Frame and Debra D. Valice 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 on February 28, 1996.
Signature Title
--------- -----
/s/Herbert M. Pearlman
-------------------------------
HERBERT M. PEARLMAN Chairman of the Board of Directors
/s/Paul A. Frame President, Chief Executive Officer
------------------------------- and Director
PAUL A. FRAME
/s/Horace A. Calvert Executive Vice President,
------------------------------- Chief Operating Officer and Director
HORACE A. CALVERT
/s/Debra D. Valice Senior Vice President of Finance,
------------------------------- Chief Financial Officer and Director
DEBRA D. VALICE
/s/ Jesse Marion
-------------------------------
JESSE MARION Director
/s/William L. Lurie
-------------------------------
WILLIAM L. LURIE Director
/s/David S. Lawi
-------------------------------
DAVID S. LAWI Director
21
<PAGE>
/s/Walter M. Craig, Jr.
-------------------------------
WALTER M. CRAIG, JR. Director
/s/William Lerner
-------------------------------
WILLIAM LERNER Director
/s/John E. Stieglitz
-------------------------------
JOHN E. STIEGLITZ Director
22
<PAGE>
Index of Exhibits
Exhibit Document
4.1 Form of Warrant granted under the 1995 Warrant Reload Plan.*
5.1 Opinion of Sewell & Riggs, P.C. legal counsel to the Company.*
10.1 Seitel, Inc. 1993 Incentive Stock Option Plan (incorporated by
reference to the Company's Quarterly Report on Form 10-Q for
the fiscal quarter ended June 30, 1993).
10.2 Seitel, Inc. Amendments to 1993 Incentive Stock Option Plan
effective May 12, 1995 (incorporated by reference to the
Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 1995).
23.1 Consent of Arthur Andersen LLP*
23.2 Consent of Forrest A. Garb & Associates, Inc.*
23.3 Consent of Sewell & Riggs, P.C. (included in Exhibit 5.1).
24.1 Power of Attorney (included on Signature Page).
* Filed herewith.
23
NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF
THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND NEITHER
THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
WARRANT MAY BE SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF
IN WHOLE OR IN PART IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER
SUCH ACT OR AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY SATISFACTORY
TO COUNSEL OF SEITEL, INC., THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT
OR THE RULES AND REGULATIONS THEREUNDER IS AVAILABLE WITH RESPECT TO THE
PROPOSED SALE, TRANSFER, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION.
SEITEL, INC.
COMMON STOCK PURCHASE
WARRANT CERTIFICATE
TO PURCHASE
---------
SHARES OF COMMON STOCK
VOID AFTER 5:00 P.M., HOUSTON, TEXAS
LOCAL TIME ON Expiration Date
---------------
Certificate No.
--------------
This Warrant Certificate certifies that Name its registered assigns is
the registered holder ("Holder") of Common Stock Purchase Warrants
----------
(the "Warrants") to purchase shares of the $.01 par value common stock, ("Common
Stock") of SEITEL, INC., a Delaware corporation (the "Company"). Each Warrant
enables the Holder to purchase from the Company at any time, on and after
Exercise Date and until 5:00 p.m., Houston, Texas, local time on Expiration Date
- ------------- ---------------
one fully paid and non-assessable share of Common Stock ("Share") upon
presentation and surrender of this Warrant Certificate and upon payment of the
purchase price of Exercise Price per Share. Payment shall be made in lawful
--------------
money of the United States of America by certified check payable to the Company
at its principal office at 50 Briar Hollow Lane, West, 7th Floor, Houston,
Texas, 77027. As hereinafter provided, the purchase price and number of Shares
purchasable upon the exercise of the Warrants are subject to modification or
adjustment upon the happening of certain events.
FOR ALL OTHER PURPOSES STATED HEREIN, THE COMPANY MAY DEEM AND TREAT
THE PERSON IN WHOSE NAME THIS WARRANT CERTIFICATE IS REGISTERED AS THE ABSOLUTE
TRUE AND LAWFUL OWNER HEREOF FOR ALL PURPOSES WHATSOEVER.
<PAGE>
1. Upon surrender to the Company, this Warrant Certificate may be
exchanged for another Warrant Certificate or Warrant Certificates
evidencing a like aggregate number of Warrants. If this Warrant
Certificate shall be exercised in part, the Holder shall be
entitled to receive upon surrender hereof another Warrant
Certificate or Warrant Certificates evidencing the number of
Warrants not exercised.
2. No Holder shall be deemed to be the holder of Common Stock or any
other securities of the Company that may at any time be issuable
on the exercise hereof for any purpose nor shall anything
contained herein be construed to confer upon the Holder any of the
rights of a shareholder of the Company or any right to vote for
the election of directors or upon any matter submitted to
shareholders at any meeting thereof or to give or withhold consent
to any corporate action (whether upon any reorganization, issuance
of stock, reclassification or conversion of stock, change of par
value, consolidation, merger, conveyance, or otherwise) or to
receive notice of meetings or to receive dividends or subscription
rights or otherwise until a Warrant shall have been exercised and
the Common Stock purchasable upon the exercise thereof shall have
become issuable.
3. Each Holder consents and agrees with the Company and any other
Holder that:
A. this Warrant Certificate is exercisable in whole or in part by
the Holder in person or by attorney duly authorized in writing
at the principal office of the Company.
B. anything herein to the contrary notwithstanding, in no event
shall the Company be obligated to issue Warrant Certificates
evidencing other than a whole number of Warrants or issue
certificates evidencing other than a whole number of Shares
upon the exercise of this Warrant Certificate; provided,
however, that the Company shall pay with respect to any such
fraction of a Share an amount of cash based upon the current
public market value (or book value, if there shall be no
public market value) for Shares purchasable upon exercise
hereof, as determined in accordance with subparagraph I of
Section 10 hereof; and
C. the Company may deem and treat the person in whose name this
Warrant Certificate is registered as the absolute true and
lawful owner hereof for all purposes whatsoever.
<PAGE>
4. The Company shall maintain books for the transfer and registration
of Warrants. Upon the transfer of any Warrants, the Company shall
issue and register the Warrants in the names of the new Holders.
The Warrants shall be signed manually by the Chairman, Chief
Executive Officer, President or any Vice President and the
Secretary (or Assistant Secretary) of the Company. The Company
shall transfer, from time to time, any outstanding Warrants upon
the books to be maintained by the Company for such purpose upon
surrender thereof for transfer properly endorsed or accompanied by
appropriate instructions for transfer. Upon any transfer, a new
Warrant Certificate shall be issued to the transferee and the
surrendered Warrants shall be canceled by the Company. Warrants
may be exchanged at the option of the Holder, when surrendered at
the office of the Company, for another Warrant, or other Warrants
of different denominations, of like tenor and representing in the
aggregate the right to purchase a like number of Shares. Subject
to the terms of this Warrant Certificate, upon such surrender and
payment of the purchase price, the Company shall issue and deliver
with all reasonable dispatch to or upon the written order of the
Holder of such Warrants and in such name or names as such Holder
may designate, a certificate or certificates for the number of
full Shares so purchased upon the exercise of such Warrants. Such
certificate or certificates shall be deemed to have been issued
and any person so designated to be named therein shall be deemed
to have become the holder of record of such Shares as of the date
of the surrender of such Warrants and payment of the purchase
price; provided, however, that if, at the date of surrender and
payment, the transfer books of the Shares shall be closed, the
certificates for the Shares shall be issuable as of the date on
which such books shall be opened and until such date the Company
shall be under no duty to deliver any certificate for such Shares;
provided, further, however, that such transfer books, unless
otherwise required by law or by applicable rule of any national
securities exchange, shall not be closed at any one time for a
period longer than 20 days. The rights of purchase represented by
the Warrants shall be exercisable, at the election of the Holders,
either as an entirety or from time to time for part only of the
Shares.
5. The Company will pay any documentary stamp taxes attributable to
the initial issuance of the Shares issuable upon the exercise of
the Warrants; provided, however, that the Company shall not be
required to pay any tax or taxes which may be payable in respect
of any transfer involved in the issuance or delivery of any
certificates for Shares in a name other than that of the Holder in
respect of which such Shares are issued, and in such case the
Company shall not be required to issue or deliver any certificate
for Shares or any Warrant until the person requesting the same has
paid to the Company the amount of such tax or has established to
the Company's satisfaction that such tax has been paid.
<PAGE>
6. In case the Warrant Certificate shall be mutilated, lost, stolen
or destroyed, the Company may, in its discretion, issue and
deliver in exchange and substitution for and upon cancellation of
the mutilated Warrant Certificate, or in lieu of and substitution
for the Warrant Certificate, lost, stolen or destroyed, a new
Warrant Certificate of like tenor and representing an equivalent
right or interest, but only upon receipt of evidence satisfactory
to the Company of such loss, theft or destruction and an
indemnity, if requested, also satisfactory to it.
7. The Company warrants that there have been reserved, and covenants
that at all times in the future it shall keep reserved, out of the
authorized and unissued Common Stock, a number of Shares
sufficient to provide for the exercise of the rights or purchase
represented by this Warrant Certificate. The Company agrees that
all Shares issuable upon exercise of the Warrants shall be, at the
time of delivery of the certificates for such Shares, validly
issued and outstanding, fully paid and non-assessable and that the
issuance of such Shares will not give rise to preemptive rights in
favor of existing shareholders.
8. As used herein, the term "Exercise Rate" shall mean the number and
kind of shares of capital stock of the Company which the Holder of
this Warrant shall be entitled from time to time to receive for
each $1,000.00 of warrant exercise payment. Unless and until an
adjustment thereof shall be required as hereinafter provided, the
Exercise Rate shall be Exercise Rate shares of Common Stock.
-------------
9. The term "Exercise Price" shall mean the price obtained by
dividing $1,000.00 by the number of shares constituting the
Exercise Rate in effect at the time for such amount.
10. The Exercise Rate in effect any time shall be subject to
adjustment as follows:
A. Whenever the Company shall (i) pay a dividend on Common Stock
in shares of its Common Stock, (ii) subdivide its outstanding
shares of Common Stock, (iii) combine its outstanding shares
of Common Stock into a smaller number of shares, or (iv) issue
by reclassification of its shares of Common Stock (including
any reclassification in connection with a consolidation or
merger in which the Company is the continuing corporation) any
shares, the Exercise Rate in effect at the time of the record
date for such dividend or of the effective date of such
subdivision, combination or reclassification shall be
proportionately adjusted so that the Holder of this Warrant
exercising it after such time shall be entitled to receive the
total number and kind of shares which bear the same proportion
to the total issued and outstanding Common Stock of the
Company immediately after such time as the proportion he would
have owned and have been entitled to receive immediately prior
to such time.
<PAGE>
B. Whenever the Company shall issue any shares of Common Stock
other than:
(i) shares issued in a transaction described in subparagraph H
of this Paragraph 10; and
(ii)shares issued upon exercise or conversion of securities of
the type referred to in subparagraphs E and F of this
Paragraph 10 or shares issued, subdivided or combined in
transactions described in subparagraph (A) of this
Paragraph 10 if and to the extent that the Exercise Rate
shall have been previously adjusted pursuant to the terms
of this subparagraph (B) or subparagraph (A) of this
Paragraph 10 as a result of the issuance, subdivision or
combination of such securities;
at a price per share which is less than the current public
market value of a share of Common Stock, the Exercise Rate in
effect immediately prior to such issuance shall be adjusted by
multiplying such Exercise Rate by a fraction, the numerator of
which shall be the number of shares of Common Stock
outstanding immediately prior to such issuance plus the number
of additional shares of Common Stock so issued, and the
denominator of which shall be the number of Shares of Common
Stock outstanding immediately prior to such issuance plus the
number of shares of Common Stock which the fair value of the
consideration received by the Company for the total number of
additional shares so issued would purchase at a price equal to
the current public market value.
C. Whenever the Company shall pay a dividend or make a
distribution (other than in a transaction which results in an
equivalent adjustment pursuant to other subparagraphs of this
Paragraph 10) generally to holders of its Common Stock or
evidences of its indebtedness or assets (excluding dividends
paid in, or distributions of cash to the extent of current
income or earned surplus of the Company), or securities of the
Company, or rights to subscribe for or purchase securities of
the Company, the Exercise Rate in effect immediately prior to
such distribution shall be adjusted by multiplying such
Exercise Rate by a fraction, the numerator of which shall be
the then current public market value, if any, per share of the
Common Stock receiving such dividend or distribution or, if
there shall be no such current public market value, then the
book value per share as of the close of the month preceding
such distribution, and the denominator of which shall be the
numerator less the fair market value of the portion of the
assets, or the evidences of indebtedness or rights, so
distributed which is applicable to each such share; provided,
however, if as a result of such adjustment the Exercise Price
would be a -------- ------- negative figure, such adjustment
shall be modified so that the Exercise Price after such
adjustment is $.01 per share.
D. Whenever the Company shall issue by reclassification of its
shares of Common Stock any shares of stock, the Exercise Rate
in effect immediately prior to such issuance shall be
proportionately adjusted so that the Holder of this Warrant
<PAGE>
exercising it after such time shall be entitled to receive,
the number and kind of shares which, when added to the number
of shares of such kind exercisable hereunder prior to such
issue, would entitle the Holder hereof, upon the exercise
hereof in full, to purchase an amount of shares of such kind
which bears the same proportion to the total issued and
outstanding capital stock of the Company as the proportion he
would have owned and have been entitled to receive immediately
prior to such issue. In the event that at any time, as a
result of an adjustment made pursuant to this paragraph 10,
the Holder of this Warrant shall become entitled upon exercise
thereof to receive any shares of the Company other than shares
of its Common Stock, then thereafter the number of such other
shares so receivable upon exercise of this Warrant shall be
subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions
contained in this Paragraph 10 in the respect of the Common
Stock.
E. For purposes of the adjustments provided for in the foregoing
subparagraphs of this Paragraph 10, if at any time, the
Company shall issue any rights or options for the purchase of,
or stock or other securities convertible into Common Stock,
(such convertible stock or securities being herein referred to
as "Convertible Securities") the Company shall be deemed to
have issued at the time of the issuance of such rights or
options or Convertible Securities the maximum number of shares
of Common Stock issuable upon exercise or conversion thereof
and to have received as consideration for the issuance of such
shares an amount equal to the amount of cash and fair value of
other consideration, if any, received by the Company for the
issuance of such rights or options or Convertible Securities,
plus, in the case of such options or rights, the minimum
amounts of cash and fair value of other consideration, if any,
payable to the Company upon the exercise of such options or
rights and, in the case of Convertible Securities, the minimum
amounts of cash and fair value of other consideration, if any,
payable, to the Company.
F. For purposes of the adjustment provided for in subparagraph B
above, if at any time the Company shall issue any rights or
options for the purchase of Convertible Securities, the
Company shall be deemed to have issued at the time of the
issuance of such rights or options the maximum number of
shares of Common Stock issuable upon conversion of the total
amount of Convertible Securities covered by such rights or
options and to have received as consideration for the issuance
of such shares an amount equal to the amount of cash and the
amount of fair value of other consideration, if any, received
by the Company for the issuance of such rights or options,
plus the minimum amounts of cash and fair value of other
consideration, if any, payable to the Company upon the
exercise of such rights or options and payable to the Company
on conversion of such Convertible Securities.
<PAGE>
G. Anything in subparagraph E or F above to the contrary
notwithstanding, whenever the Company shall issue any shares
(other than on exercise of this Warrant) upon exercise of any
rights or options or upon conversion of any Convertible
Securities and if the Exercise Rate shall not previously have
been adjusted upon the issuance of such rights, options or
Convertible Securities, the computation described in
subparagraph B above shall be made and the Exercise Rate
adjusted in accordance with the provisions thereof (the shares
so issued being deemed for purposes of such computation to
have been issued at a price per share equal to the amount of
cash and fair value of other consideration, if any, properly
attributable to one such share received by the Company upon
issuance and exercise of such rights or options or sale and
conversion of such Convertible Securities (and upon issuance
of any rights or options pursuant to which such Convertible
Securities may have been sold).
H. Anything in this Paragraph 10 to the contrary notwithstanding,
no adjustment in the Exercise Rate or Exercise Price shall be
made in connection with:
(i) Convertible Securities issued pursuant to the Company's
qualified or non-qualified Employee Stock Option Plans or
any other bona fide employee benefit plan or incentive
arrangement, adopted or approved by the Company's Board of
Directors or shares of Common Stock issued pursuant to the
exercise of any rights or options granted pursuant to said
plans or arrangements (but only to the extent that the
aggregate number of shares excluded by the Clause (i) and
issued after the date hereof shall not exceed 15% of the
Company's Common Stock outstanding at the time of any such
issuance); and
(ii)The issuance of any shares of Common Stock pursuant to the
exercise of Convertible Securities outstanding as of the
date hereof including without limitation, the conversion
of any Warrant issued in the same placement of securities
pursuant to which this Warrant was issued by the Company.
I. For purposes of this Paragraph 10, the current public market
value of a share of Common Stock on any date shall be deemed
to be the arithmetical average of the following prices for
such of the thirty (30) business days immediately preceding
such day as shall be available: (i) for any of the such days
on which the Common Stock shall be listed on a national
securities exchange, the last sale price on such day or, if
there shall have been no sale on such day, the average of the
closing bid and asked prices on such exchange on such day, or
<PAGE>
(ii) for any of such days on which the Common Stock shall not
be listed on a national securities exchange but shall be
included in the National Association of Securities Dealers
Automated Quotation System ("NASDAQ"), the average of the
closing bid and asked prices on such day quoted by brokers and
dealers making a market in NASDAQ, furnished by any member of
the New York Stock Exchange selected by the Company for that
purpose, or (iii) for any of such days on which the Common
Stock shall not be so listed on a national securities exchange
or included in NASDAQ but shall be quoted by three brokers
regularly making a market in such shares in the
over-the-counter market, the average of the closing bid and
asked prices on such day, furnished by any member of the New
York Stock Exchange selected by the Company for that purpose,
or (iv) for any days on which the information described in
items (i), (ii) or (iii) above is unavailable, the book value
per share of the Common Stock as determined in accordance with
generally accepted accounting principles; provided, however,
in its discretion the Board may make an appropriate reduction
in the "current public market value" based upon any applicable
trading restrictions to particular shares of Common Stock.
J. Anything in this Paragraph 10 to the contrary notwithstanding,
no adjustment in the Exercise Rate shall be required unless
such adjustment would require an increase or decrease of at
least 1% in such rate; provided, however, that any adjustments
which by reason of this subparagraph J are not required to be
made shall be carried forward and taken into account in making
subsequent adjustments. All calculations under the Paragraph
10 shall be made to the nearest cent or to the nearest
one-hundredth of a share, as the case may be.
K. No adjustment in the Exercise Rate shall be made for purposes
of subparagraphs B and C of this Paragraph 10 if such
adjustment would result in an increase in such Exercise Price
or decrease in the Exercise Rate except that, in the case of
any Convertible Securities in respect of which an adjustment
has previously been made under subparagraph B above and which
has expired or otherwise been canceled without exercise of the
rights or options evidenced thereby, such previous adjustment
shall be reversed.
L. Before taking any action which could cause an adjustment
pursuant to this Paragraph 10 reducing the Exercise Price per
share below the then par value (if any) of the shares covered
hereby, the Company will take any corporate action which may
be necessary in order that the Company may validly and legally
issue at the Exercise Price as so adjusted shares that are
fully paid and non-assessable.
M. The number of shares of capital stock of the Company
outstanding at any given time shall not include shares owned
or held by or for the account of the Company, and the
disposition of any such shares shall be considered an issue or
sale of such shares for the purposes of this Paragraph 10.
N. If any event occurs as to which the other provisions of this
Paragraph 10 are not strictly applicable but the lack of any
adjustment would not fairly protect the purchase rights of the
Holder of this Warrant in accordance with the basic intent and
<PAGE>
principles of such provisions, or if strictly applicable would
not fairly protect the purchase rights of the Holder of this
Warrant in accordance with the basic intent and principles of
such provisions, then the Company shall appoint a firm of
independent certified public accountants (which shall not be
the regular auditors of the Company) of recognized national
standing, which shall give their opinion upon the adjustment,
if any, on a basis consistent with the basic intent and
principles established in the other provisions of this
Paragraph 10, necessary to preserve, without dilution, the
exercise rights of the registered Holder of this Warrant. Upon
receipt of such opinion, the Company shall forthwith make the
adjustments described therein. In taking any action or making
any determination pursuant to the provisions of this Section
10, the Company and its Board of Directors shall, at all
times, exercise reasonable judgment and act in good faith.
O. Upon any adjustment of any Exercise Rate, then and in each
such case, the Company shall promptly deliver a notice to the
registered Holder of this Warrant, which notice shall state
the Exercise Price and Exercise Rate resulting from such
adjustment and the increase or decrease, if any, in the number
of shares purchasable at such price upon the exercise hereof,
setting forth in reasonable detail the method of calculation
and the facts upon which such calculation is based.
P. In the case of the issuance of shares of Common Stock or
Convertible Securities for a consideration in whole or in
part, other than cash, the consideration other than cash shall
be deemed to be the fair market value thereof as reasonably
determined in good faith by the Board of Directors of the
Company (regardless of accounting treatment thereof);
provided, however, that if such consideration consists of the
cancellation of debt issued by the Company the consideration
shall be deemed to be the amount the Company received upon
issuance of such debt (gross proceeds) plus accrued interest
and, in the case of original issue discount or zero coupon
indebtedness, accreted value to the date of such cancellation,
but not including any premium or discount at which the debt
may then be trading or which might otherwise be appropriate
for such class of debt;
Q. The Company shall not issue any shares of its capital stock
(other than Common Stock) at or for consideration which is
less than fair value determined by the Board of Directors of
the Company in light of all circumstances surrounding such
issuance.
11. In the case:
A. The Company shall declare any dividend or distribution on its
Common Stock (or on any other shares which the Holder of this
Warrant may become entitled to receive upon exercise hereof);
or
<PAGE>
B. The Company shall authorize the issuance to holders of its
Common Stock (or on any other shares which the Holder of this
Warrant may become entitled to receive upon exercise hereof)
any subscription rights or warrants; or
C. Of any subdivision, combination or reclassification of shares
of Common Stock of the Company (or any shares of the Company
which are subject to this Warrant), or of any proposed
consolidation or merger to which the Company is to be a party
and for which the approval of any shareholders of the Company
is required, or of the proposed sale or transfer of all or
substantially all of the assets of the Company; or
D. Of the proposed voluntary or involuntary dissolution,
liquidation, or winding up of the Company; or
E. The Company proposes to effect any transaction not specified
above which would require an adjustment of the Exercise Rate
pursuant to Paragraph 10 hereof;
then the Company shall cause to be mailed to Holders of this
Warrant, at least ten (10) days prior to the applicable record or
other date hereinafter specified, a notice describing such
transaction in reasonable detail, specifying the character, amount
and terms of all securities and the amounts of cash and other
property, if any, involved in such transaction and stating (i) the
date as of which the holders of Common Stock (or any such other
shares) of record to be entitled to receive any such dividend,
distribution, rights, or warrants is to be determined, or (ii) the
date of which any such subdivision, combination, reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation,
winding up, or other transaction is expected to become effective,
and the date as of which it is expected that holders of Common
Stock (or any such other shares) of record shall be entitled to
exchange the same for securities or other property, if any,
deliverable upon such transaction.
12. The Company covenants and agrees that it will not merge or
consolidate with or into or sell or otherwise transfer all or
substantially all of its assets to any other corporation or entity
unless at the time of or prior to such transaction such other
corporation or other entity shall expressly assume all of the
liabilities and obligations of the Company under this Warrant and
(without limiting the generality of the foregoing) shall expressly
agree that the Holder of this Warrant shall thereafter have the
right (subject to subsequent adjustment as nearly equivalent as
practicable to the adjustments provided for in Paragraph 10 of
this Warrant) to receive upon the exercise of this Warrant the
number and kind of shares of stock and other securities and
property receivable upon such transaction by a Holder of the
number and kind of shares which would have been receivable upon
the exercise of this Warrant immediately prior to such
transactions.
<PAGE>
13. The Holder of this Warrant Certificate, each transferee hereof and
any holder and transferee of any Shares, by his acceptance
thereof, agrees that (i) no public distribution of Warrants or
shares will be made in violation of the Act, and (ii) during such
period as the delivery of a prospectus with respect to Warrants or
Shares may be required by the Act, no public distribution of
Warrants or Shares will be made in a manner or on terms different
from those set forth in, or without delivery of, a prospectus then
meeting the requirements of Section 10 of the Act and in
compliance with all applicable state securities laws. The Holder
of this Warrant Certificate and each transferee hereof further
agrees that if any distribution of any of the Warrants or Shares
is proposed to be made by them otherwise than by delivery of a
prospectus meeting the requirements of Section 10 of the Act, such
action shall be taken only after submission to the Company of an
opinion of counsel, reasonably satisfactory in form and substance
to the Company's counsel, to the effect that the proposed
distribution will not be in violation of the Act or of applicable
state law. Furthermore, it shall be a condition to the transfer of
the Warrants that any transferee thereof deliver to the Company
his written agreement to accept and be bound by all of the terms
and conditons contained in this Warrant Certificate.
14. This Warrant Certificate shall be exercisable only during the
continuance of the Holder's employment at the Company or its
subsidiaries, except that:
a. If the Holder ceases to be an employee at the Company (or a
subsidiary of the Company) for any reason other than by death
or disability, this Warrant Certificate may be exercised by
Holder, to the extent that it was exercisable at the date of
termination, at any time within three months after the date
Holder ceases to be an employee, but not later than the
Expiration Date, except that, in case of his death or
---------------
disability within that three-month period, this Warrant
Certificate may be exercised as provided in subparagraph (b)
below.
b. If the Holder dies or becomes disabled during employment or
within the three-month period referred to in subparagraph (a)
above, this Warrant Certificate may be exercised, to the
extent that it was exercisable by the Holder at the date of:
(i) death, by the person or persons to whom Holder's rights
under this Warrant Certificate pass by will or by the laws
of descent and distribution or
(ii) disability, by the Holder's legal representative,
at any time within one year after the date of Holder's death
or disability, but not later than the Expiration Date.
---------------
<PAGE>
The determination by the Company's Board of Directors of the
reason for termination of the Holder's employment shall be binding
and conclusive on the Holder.
WITNESS the following signatures as of this day of ,
1995. -------- --------
SEITEL, INC.
By:/s/ Paul A. Frame
---------------------------
Paul A. Frame
Chief Executive Officer
Accepted:
------------------------
<PAGE>
PURCHASE FORM
TO: SEITEL, INC. DATE:
--------------
The undersigned hereby irrevocably elects to exercise the attached
Warrant Certificate No. to the extent of of Common
----------------- ----------
Stock, $.01 par value per share of SEITEL, INC., and hereby makes payment of
in payment of the aggregate exercise price thereof.
- ------------
INSTRUCTIONS FOR REGISTRATION OF SECURITIES
Name:
-------------------------------
Address:
-------------------------------
-------------------------------
-------------------------------
-------------------------------
-----------------------------
By:
-------------------------
GARDERE WYNNE SEWELL & RIGGS, L.L.P.
333 Clay, Suite 800
Houston, Texas 77002-4086
(713) 308-5500
February 28, 1996
Seitel, Inc.
50 Briar Hollow Lane, 7th Floor West
Houston, Texas 77027
Gentlemen:
We have acted as counsel for Seitel, Inc. (the "Company") in connection
with the registration statement on Form S-8/S-3 of the Company (the
"Registration Statement"), which will be filed on or about February 28, 1996, by
the Company with the Securities and Exchange Commission under the Securities Act
of 1933, as amended (the "Act"), for the registration under the Act of up to
2,051,122 shares (the "S-8 Shares") of common stock, par value $.01 per share,
of the Company to be (a) issued by the Company pursuant to common stock purchase
options issued under its 1993 Incentive Stock Option Plan (the "Option Plan"),
and (b) issued by the Company pursuant to common stock purchase warrants issued
under its 1995 Warrant Reload Plan (the "Reload Plan") and, for resale only, of
some number of the S-8 shares which may be acquired by affiliates of the Company
upon exercise of options under the Option Plan, or which will be issuable upon
exercise of common stock purchase warrants (x) by affiliates of the Company and
(y) by non-affiliates to whom such warrants have been granted by the Company
under the Reload Plan prior to the effective date of the Registration Statement
(the "S-3 Shares").
In the capacity as counsel for the Company, we have familiarized
ourselves with the Certificate of Incorporation of the Company, as amended, and
the Bylaws of the Company, as amended. We have examined all statutes and other
records, instruments and documents pertaining to the Company that we have deemed
necessary to examine for the purpose of this opinion.
Based upon and subject to the foregoing, we are of the opinion that
upon completion of the proceedings being taken to permit such transactions to be
carried out in accordance with the securities laws of the various states where
required, (i) the S-8 Shares acquired in accordance with the terms of the Option
Plan; (ii) the S-8 Shares issued pursuant to the terms of common stock purchase
warrants issued and to be issued under and in accordance with the Reload Plan;
<PAGE>
and (iii) the S-3 Shares resold in the manner described in the S-3 Prospectus
contained in the Registration Statement, will be validly issued, fully paid, and
non-assessable.
We are members of the Bar of the State of Texas and we do not express
an opinion herein concerning any other law other than the laws of the State of
Texas, the federal law of the United States, and the Delaware General
Corporation Law.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us under the caption "Legal
Matters" in the Prospectus forming a part thereof.
Very truly yours,
GARDERE WYNNE SEWELL & RIGGS, L.L.P.
BY: /s/ Daniel Cohen
-------------------------------
Daniel Cohen
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 3, 1995,
included in the Seitel, Inc. Annual Report on Form 10-K for the year ended
December 31, 1994, and to all references to our Firm included in this
registration statement.
/s/ Arthur Andersen LLP
- -------------------------
Houston, Texas
February 27, 1996
FORREST A. GARB & ASSOCIATES, INC.
PETROLEUM CONSULTANTS
5310 HARVEST HILL ROAD, SUITE 160 - LB 152
DALLAS, TEXAS 75230-5805
(214)788-1110 TELEFAX 991-3160
February 27, 1996
CONSENT OF EXPERT
Ms. Debra Valice
Seitel, Inc.
50 Briar Hollow Lane, 7th Floor West
Houston, Texas 77027
Dear Ms. Valice:
Forrest A. Garb & Associates, Inc., petroleum consultants, hereby
consent to the incorporation by reference in any registration statement or other
document filed with the Securities and Exchange Commission by Seitel, Inc. our
reserve report dated January 1, 1995 and to all references to our firm included
therein.
Forrest A. Garb & Associates, Inc.
By: /s/ Ronald D. Wade
---------------------------
Name: Ronald D. Wade
---------------------------
Title: Executive Vice President
---------------------------
Dallas, Texas
February 27, 1996
