UNIVERSAL SEISMIC ASSOCIATES, INC.
16420 Park Ten Place, Suite 300
Houston, Texas 77084-5051
SUPPLEMENT TO PROXY STATEMENT OF DECEMBER 18, 1996
ANNUAL MEETING OF STOCKHOLDERS
To Be Held Tuesday, January 28, 1997
This supplement to the December 18, 1996 Proxy Statement of the Company is
intended to supplement certain points therein.
Recently, you have received several items from the Company and "the
Shareholders' Committee" (which was formed by two shareholders, Robert Kecseg
and Michael T. Kanarellis). The "Shareholders' Committee" wants to resurrect the
Suelopetrol merger which the Company and its management determined not to be in
the best interests of the Company earlier this year.
THE BOARD DOES NOT BELIEVE THAT THE COMMITTEE PROXY SOLICITATION NOR THE
COMMITTEE CONSENT SOLICITATION IS IN THE BEST INTEREST OF THE COMPANY AND ITS
SHAREHOLDERS. THE BOARD URGES YOU NOT TO EXECUTE ANY PROXIES OR CONSENTS
SOLICITED BY THE COMMITTEE. PLEASE RETURN ONLY THE WHITE PROXY CARD IN THE
ENCLOSED ENVELOPE.
Mr. Kanarellis' latest letter to you dated January 8, 1997 states that the
Company has given you false information about management, the Company and the
proposed Suelopetrol merger.
A FEW FACTS ABOUT THE COMPANY
Despite Mr. Kanarellis' statements and opinions to the contrary, these
basic facts are true and many are a matter of public record.
1. The Company had record earnings and revenues in the second quarter of 1996.
This is a matter of public record. [Press release dated January 9, 1997]
2. Current senior management members and RIMCO have substantial ownership
positions directly or through trusts and partnerships. Collectively, they
own more than 38% of the outstanding shares of the Company's stock. This is
a matter of public record. Thus, current management has a substantial stake
in the performance of the Company, contrary to Mr. Kanarellis' assertions.
[See the Company's SEC Schedule 14A filed on December 24, 1996]
3. Contrary, to Mr. Kanarellis' claims, UNEXCO remains an important long-term
project.
4. The Company's advisors did give management their views of the proposed
Suelopetrol merger as structured within the scope of their respective
engagements. Their input reinforced the Board of Directors' decision that
the pending proposal was grossly unfair to the Company and required
significant changes in the structure of the transaction. These changes were
mandated in large part by substantial variances in actual values when
compared to projected values in the originally proposed deal. These
substantial variances were discovered by the Company's advisors while
conducting due diligence review of the proposed transaction. Because the
due diligence process was terminated by Suelopetrol and the Company's
mutual agreement, Raymond James and Associates
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could not issue a formal opinion regarding the fairness of the proposed
transaction. The scope of the Company's engagement of Coopers & Lybrand did
not involve the issuance of an opinion regarding fairness of the originally
proposed transaction; however, Coopers & Lybrand was engaged to examine the
operating results of Suelopetrol for the twelve month period ended June 30,
1996 and did discover significant variances between the results originally
represented to the Company and actual operating results for the audit
period. These variances materially affected the proposed transaction and
substantially impacted managements' view of the fairness of the
transaction. None of the Company's advisors, other than Mr. Kanarellis, has
ever recommended that it enter into the originally proposed transaction
with Suelopetrol.
5. BOTH the Company's Board of Directors and Suelopetrol terminated the merger
negotiations. Both entities agreed to terminate negotiations with no impact
on future discussions. As stated in its original proxy statement and its
letters to you, management is still interested in a combination with
Suelopetrol, but only if it is beneficial to the Company.
6. Mr. Kanarellis and Mr. Kecseg have now filed suit against the Company and
several members of its management and Board in Federal District Court in
Delaware seeking to postpone the shareholders' meeting so that their
lawyers can take depositions of numerous witnesses involved with the
Suelopetrol negotiations. The plaintiff's claim that the Company has
misrepresented the facts concerning the Suelopetrol negotiations in its
proxy materials. One of the principal complaints in the suit is that the
Company has failed to state its reasons for not going forward with
Suelopetrol. The Company stated that it determined the transaction was not
in the best interests of the Company. That decision was based in material
part on the financial aspects of the transaction. Unfortunately, the
Company is bound by a confidentiality agreement with Suelopetrol not to
disclose its financial information without its consent. The Company has not
been able to obtain Suelopetrol's consent to release that information to
date.
Mr. Kanarellis is trying to take the decision as to who should run your
Company our of your hands and into the courtroom.
ALL DULY EXECUTED PROXIES WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS
THEREON. SHAREHOLDERS WHO EXECUTE PROXIES, HOWEVER, RETAIN THE RIGHT TO REVOKE
THEM AT ANY TIME BEFORE THEY ARE VOTED. THE REVOCATION OF A PROXY WILL NOT BE
EFFECTIVE UNTIL WRITTEN NOTICE THEREOF HAS BEEN GIVEN TO THE SECRETARY OF THE
COMPANY, UNLESS THE SHAREHOLDER GRANTING SUCH PROXY VOTES IN PERSON AT THE
ANNUAL MEETING.
By the order of the Directors,
/s/ Vicki D. Humphrey
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VICKI D. HUMPHREY, Secretary
Houston, Texas
January 21, 1997
If you have any questions about how to vote your proxy card,
please call our proxy solicitor,
Corporate Investor Communications, Inc., toll free at (800)346-7885.
