Seitel Announces Effectiveness of Plan of Reorganization, Closing of Institutional Private Placement of $193 Million Aggregate P
July 02 2004 - 5:30PM
PR Newswire (US)
Seitel Announces Effectiveness of Plan of Reorganization, Closing
of Institutional Private Placement of $193 Million Aggregate
Principal Amount at Maturity of 11 3/4% Senior Notes Due 2011,
Commencement of 30-day Warrant Offering and Appointment of New
Board Members HOUSTON, July 2 /PRNewswire-FirstCall/ -- Seitel,
Inc. (OTC:SEIEQ) (BULLETIN BOARD: SEIEQ) , a leading provider of
seismic data and related geophysical services to the oil and gas
industry in North America, today announced that its Plan of
Reorganization (the "Plan") has become effective today. In
accordance with the Plan, which was confirmed by the bankruptcy
court on March 18, 2004, Seitel consummated a private placement of
$193 million aggregate principal amount due at maturity of its 11
3/4% Senior Notes due 2011 (the "Notes"). The Notes were offered to
investors at a price of 97.675% of the face amount of the Notes,
resulting in gross proceeds to Seitel of approximately $188.5
million. The notes will pay stated interest of 11 3/4% per annum,
semi-annually in arrears, commencing January 15, 2005. Net proceeds
of approximately $180.7 million from the Notes offering, together
with an additional cash amount, have been placed in escrow pending
the completion of equity financing transactions contemplated by the
Plan (including the warrant offering described below), and will be
used, together with the net proceeds from the warrant offering and
certain cash on hand, to pay 100% of allowed creditors' claims,
together with post-petition interest, as required under the Plan.
If certain conditions to the release from escrow of such funds do
not occur on or prior to September 15, 2004, the escrowed funds
will be used to fund a special mandatory redemption of all
outstanding notes at a cash redemption price equal to 101% of the
accreted value thereof, plus accrued and unpaid interest.
Commencing today, each holder of record of Seitel's common stock as
of June 25, 2004 will receive for each share owned by them on such
date, one warrant to purchase 4.926 newly issued shares of Seitel's
common stock, at an exercise price of 60 cents per share. The
warrants will be exercisable and transferable until 5:00 p.m., New
York City time, on August 2, 2004. Stockholders who do not exercise
their warrants will have their percentage equity ownership in
Seitel diluted by up to approximately 83%. American Stock Transfer
& Trust Company ("AST&T") is Seitel's transfer and warrant
agent. Upon surrender of and in exchange for certificates
representing Seitel's "old" common stock, together with a properly
completed letter of transmittal being distributed by AST&T,
certificates representing shares of Seitel's reorganized common
stock will be issued. Also in accordance with the Plan, effective
today, Messrs. Walter M. Craig, Jr., Robert L. Knauss, William
Lerner and John E. Stieglitz resigned as directors of Seitel.
Seitel now has a classified board of directors consisting of three
classes. Class I consists of three directors who will serve for an
initial term of three years expiring in 2007, Class II consists of
three directors who will serve for an initial term of two years
expiring in 2006, and Class III consists of one director who will
serve for an initial term of one year expiring in 2005. Effective
today, each of Messrs. Randall D. Stilley, Seitel's President and
Chief Executive Officer, Robert Kelley, J.D. Williams, Charles H.
Mouquin, C. Robert Black and Ned S. Holmes commenced serving as
directors of Seitel. Messrs. Fred S. Zeidman, Seitel's Chairman of
the Board, J.D. Williams and C. Robert Black will serve as the
three Class I directors, Messrs. Robert Kelley, Charles H. Mouquin
and Ned S. Holmes will serve as the three Class II directors, and
Mr. Stilley will serve as the sole Class III director. Each class
of directors standing for election upon the expiration of his
initial term will be elected for successive terms of three years.
Accordingly, Seitel will not hold an annual meeting of stockholders
to elect a Class III director until 2005. ABOUT SEITEL Seitel is a
leading provider of seismic data and related geophysical services
to the oil and gas industry in North America. Seitel's products and
services are used by oil and gas companies to assist in the
exploration for and development and management of oil and gas
reserves. Seitel has ownership in an extensive library of
proprietary onshore and offshore seismic data that it has
accumulated since 1982 and that it offers for license to a wide
range of oil and gas companies. Seitel believes that our library of
onshore seismic data is one of the largest available for licensing
in the United States and Canada Seitel's seismic data library
includes both onshore and offshore three- dimensional (3D) and
two-dimensional (2D) data and offshore multi-component data. Seitel
has ownership in approximately 32,000 square miles of 3D and
approximately 1.1 million linear miles of 2D seismic data
concentrated primarily in the major North American oil and gas
producing regions. Seitel markets its seismic data to over 1,300
customers in the oil and gas industry, and it has license
arrangements with in excess of 1,000 customers. Statements in this
release about the future outlook related to Seitel involve known
and unknown risks and uncertainties, which may cause Seitel's
actual results to differ materially from expected results. While
Seitel believes its forecasting assumptions are reasonable, there
are factors that are hard to predict and influenced by economic and
other conditions that are beyond Seitel's control. Among the other
important factors which could cause actual results to differ
materially from those in the forward-looking statements are the
failure of the Plan to otherwise become effective, as well as other
factors detailed in the Disclosure Statement related to the Plan or
in Seitel's filings with the Securities and Exchange Commission,
including its most recent Annual Report on Form 10-K, a copy of
which may be obtained from Seitel without charge. A registration
statement on Form S-1 (No. 333-113446) relating to Seitel's common
stock purchase warrants has been filed with the Securities and
Exchange Commission and has been declared effective. This press
release shall not constitute an offer to sell or the solicitation
of an offer to buy nor shall there be any sale of these securities
in any state in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such state. A copy of the final prospectus
covering the offer and sale of the warrants and underlying common
stock is being delivered to stockholders of Seitel as of June 25,
2004 and may be obtained from Seitel without charge. Contact
Information: Leonard M. Goldstein, General Counsel Robert D.
Monson, Chief Financial Officer Telephone: 713-881-8900 DATASOURCE:
Seitel, Inc. CONTACT: Leonard M. Goldstein, General Counsel, or
Robert D. Monson, Chief Financial Officer, both of Seitel, Inc.,
+1-713-881-8900 Web site: http://www.seitel-inc.com/
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