Exhibit 10.1
FORM OF
GUARANTOR WARRANT AGENT AGREEMENT
Dated as of ____________, 2004
by and among
SEITEL, INC.
and
AMERICAN STOCK TRANSFER & TRUST COMPANY
GUARANTOR WARRANT AGENT AGREEMENT
TABLE OF CONTENTS*
Page
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Section 1. Certain Definitions; General Interpretive Principles.............................. 1
Section 2. Appointment of Guarantor Warrant Agent............................................ 3
Section 3. Issuance of Guarantor Warrants; Warrant Certificates.............................. 3
Section 4. Execution of Guarantor Warrant Certificates....................................... 3
Section 5. Registration and Countersignature................................................. 4
Section 6. Registration of Transfers and Exchanges........................................... 4
Section 7. Terms of Guarantor Warrants; Exercise of Guarantor Warrants....................... 6
Section 8. Payment of Taxes.................................................................. 7
Section 9. Adjustments....................................................................... 7
Section 10. Mutilated or Missing Guarantor Warrant Certificates............................... 8
Section 11. Reservation of Guarantor Warrant Shares........................................... 8
Section 12. Fractional Interests.............................................................. 8
Section 13. Merger, Consolidation or Change of Name of Guarantor Warrant Agent................ 9
Section 14. Guarantor Warrant Agent........................................................... 9
Section 15. Resignation and Removal of Guarantor Warrant Agent; Appointment of Successor...... 11
Section 16. Notices to Company and Guarantor Warrant Agent.................................... 12
Section 17. Supplements and Amendments........................................................ 13
Section 18. Successors........................................................................ 13
Section 19. Termination....................................................................... 13
Section 20. Governing Law..................................................................... 13
Section 21. Benefits of This Guarantor Warrant Agent Agreement................................ 14
Section 22. Counterparts...................................................................... 14
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* This Table of Contents does not constitute a part of this Warrant Agent
Agreement or have any bearing upon the interpretation of any of its terms
or provisions.
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GUARANTOR WARRANT AGENT AGREEMENT
GUARANTOR WARRANT AGENT AGREEMENT dated as of [_____________], 2004
(the "Guarantor Warrant Agent Agreement") between Seitel, Inc., a Delaware
corporation (the "Company"), and American Stock Transfer & Trust Company, or its
successor or successors appointed in accordance with the terms hereof, as
warrant agent (the "Guarantor Warrant Agent"). Any capitalized term used but not
defined in this Agreement shall have the meaning set forth in the Company's Plan
(as hereinafter defined).
WHEREAS, the Company has, subject and pursuant to a Standby Funding
Guaranty Agreement, dated [_______________], 2004, agreed to issue to the
Funding Guarantors (as hereinafter defined) Guarantor Warrants.
WHEREAS, the Company desires the Guarantor Warrant Agent to act on
behalf of the Company, and the Guarantor Warrant Agent is willing to so act, in
connection with the issuance of Warrant Certificates (as hereinafter defined)
and other matters as provided herein.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein set forth, and for the purpose of defining the
respective rights and obligations of the Company, the Guarantor Warrant Agent
and the Holders (as hereinafter defined), the parties hereto agree as follows:
Section 1. Certain Definitions; General Interpretive Principles.
(a) Certain Definitions. As used in this Guarantor Warrant Agent
Agreement, the following terms shall have the following respective meanings:
"Bankruptcy Code" means the Bankruptcy Reform Act of 1978, as
codified in Title 11 of the United States Code, 11 U.S.C. (S)(S)101-1331, as
amended.
"Commission" means the Securities and Exchange Commission.
"Common Shares" means shares of Common Stock.
"Common Stock" means the common stock, par value $.01 per share,
of the Company, and any other capital stock of the Company into which such
common stock may be converted or reclassified or that may be issued in respect
of, in exchange for, or in substitution for, such common stock by reason of any
stock splits, stock dividends, distributions, mergers, consolidations or other
like events.
"Company" means Seitel, Inc., a Delaware corporation, and its
successors and assigns.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Effective Date" means the date on which a Registration Statement
filed by the Company with the Commission on Form S-1, File No. 333-[______] has
been declared effective.
"Funding Guarantors" means Mellon HBV Alternative Strategies LLC,
acting on behalf of certain funds and managed accounts whose names are set forth
on Schedule A of that certain Standby Investment Agreement, dated as of
__________, 2004, and each of the entities identified by HBV under that
agreement and which subsequently execute a separate subscription agreement with
the Company to purchase Offered Shares.
"Guaranty Exercise Price" means the purchase price per Common
Shares to be paid upon the exercise of each Guarantor Warrant in accordance with
the terms hereof, which price shall initially be $[_____] per share, subject to
adjustment from time to time as provided in the Guarantor Warrant.
"Guarantor Warrants" means those certain warrants issued to the
Funding Guarantors on the Guaranty Performance Date granting them the right to
purchase shares of Reorganized Seitel Common Stock at the Guaranty Exercise
Price.
"Guarantor Warrant Expiration Date" means 5:00 P.M., New York
Time, on [_____________, 2011.
"Holder" means a person registered as the owner of the Guarantor
Warrants.
"Offered Shares" means the shares of New Seitel Common Stock
which may be purchased by exercise of the Shareholder Warrants in accordance
with Article V and related definitions of the Plan.
"Securities Act" means the Securities Act of 1933, as amended.
"Guarantor Warrant Agent" means American Stock Transfer and Trust
Company or the successor or successors of such Guarantor Warrant Agent appointed
in accordance with the terms hereof.
"Warrant Shares" means the Common Shares issued or issuable
upon the exercise of the Guarantor Warrants.
(b) General Interpretative Principles. For purposes of this Guarantor
Warrant Agent Agreement, except as otherwise expressly provided or unless the
context otherwise requires:
(i) the terms defined herein include the plural as well as the
singular, and the use of any gender herein shall be deemed
to include the other gender;
(ii) accounting terms not otherwise defined herein have the
meanings given to them in accordance with generally
accepted accounting principles;
(iii) references herein to "Articles", "Sections", "Subsections",
"Paragraphs", and other subdivisions without reference to a
document are to designated Articles, Sections, Subsections,
Paragraphs and other subdivisions hereof;
(iv) a reference to a Subsection without further reference to a
Section is a reference to such Subsection as contained in
the same Section in which the
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reference appears, and this rule shall also apply to
Paragraphs and other subdivisions;
(v) the words "herein", "hereof", "hereunder" and other words
of similar import refer to this Guarantor Warrant Agent
Agreement as a whole and not to any particular provision;
(vi) the words "include" and "including" shall mean without
limitation by reason of enumeration; and
(vii) the headings in this Guarantor Warrant Agent Agreement are
solely for convenience of reference and shall be given no
effect in the construction or interpretation of this
Guarantor Warrant Agent Agreement.
Section 2. Appointment of Guarantor Warrant Agent. The Company hereby
appoints the Guarantor Warrant Agent to act as agent for the Company in
accordance with the instructions set forth hereinafter in this Guarantor Warrant
Agent Agreement, and the Guarantor Warrant Agent hereby accepts such
appointment.
Section 3. Issuance of Guarantor Warrants; Warrant Certificates. The
Guarantor Warrants will be issued in definitive form. Any certificates (the
"Warrant Certificates") evidencing the warrants to be delivered pursuant to this
Guarantor Warrant Agent Agreement shall be substantially in the form set forth
in Exhibit A hereto.
Section 4. Execution of Guarantor Warrant Certificates. Guarantor
Warrant Certificates shall be signed on behalf of the Company by its Chairman of
the Board or its President and Chief Executive Officer or a Senior Vice
President and by its Secretary or an Assistant Secretary under its corporate
seal. Each such signature upon the Guarantor Warrant Certificates may be in the
form of a facsimile signature of the present or any future Chairman of the
Board, President and Chief Executive Officer, Senior Vice President, Secretary
or Assistant Secretary and may be imprinted or otherwise reproduced on the
Guarantor Warrant Certificates and for that purpose the Company may adopt and
use the facsimile signature of any person who shall have been Chairman of the
Board, President and Chief Executive Officer, Senior Vice President, Secretary
or Assistant Secretary, notwithstanding the fact that at the time the Guarantor
Warrant Certificates shall be countersigned and delivered or disposed of such
person shall have ceased to hold such office. The seal of the Company may be in
the form of a facsimile thereof and may be impressed, affixed, imprinted or
otherwise reproduced on the Guarantor Warrant Certificates.
In case any officer of the Company who shall have signed any of the
Guarantor Warrant Certificates shall cease to be such officer before the
Guarantor Warrant Certificates so signed shall have been countersigned by the
Guarantor Warrant Agent, or disposed of by the Company, such Guarantor Warrant
Certificates nevertheless may be countersigned and delivered or disposed of as
though such person had not ceased to be such officer of the Company; and any
Guarantor Warrant Certificate may be signed on behalf of the Company by any
person who, at the actual date of the execution of such Guarantor Warrant
Certificate, shall be a proper officer
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of the Company to sign such Guarantor Warrant Certificate, although at the date
of the execution of this Guarantor Warrant Agent Agreement any such person was
not such officer.
Guarantor Warrant Certificates shall be dated the Guaranty Performance
Date.
Section 5. Registration and Countersignature. The Guarantor Warrant
Agent, on behalf of the Company, shall number and register the Guarantor Warrant
Certificates in a register as they are issued by the Company.
Guarantor Warrant Certificates shall be countersigned manually or by
facsimile by the Guarantor Warrant Agent and shall not be valid for any purpose
unless so countersigned. The Guarantor Warrant Agent shall, upon written
instructions of the Chairman of the Board, the President and Chief Executive
Officer or a Senior Vice President of the Company, initially countersign, issue
and deliver Guarantor Warrants entitling the Holders thereof to purchase not
more than the number of Guarantor Warrant Shares referred to above in the first
recital hereof and shall countersign and deliver Guarantor Warrants as otherwise
provided in this Guarantor Warrant Agent Agreement.
The Company and the Guarantor Warrant Agent may deem and treat the
Holder(s) of the Warrant Certificates as the absolute owner(s) thereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone), for all purposes, and neither the Company nor the Guarantor Warrant
Agent shall be affected by any notice to the contrary.
Section 6. Registration of Transfers and Exchanges.
(a) Transfer and Exchange of Guarantor Warrants. When the Guarantor
Warrants are presented to the Guarantor Warrant Agent with a request:
(i) to register the transfer of the Guarantor Warrants; or
(ii) to exchange such Guarantor Warrants for an equal number
of Guarantor Warrants of other authorized denominations,\
the Guarantor Warrant Agent shall register the transfer or make the exchange as
requested if its requirements for such transactions are met; provided, that the
Guarantor Warrants presented or surrendered for registration of transfer or
exchange:
(x) shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the
Guarantor Warrant Agent, duly executed by the Holder
thereof or by his attorney, duly authorized in writing; and
(y) in the case of any Restricted Warrant (as defined below),
such request shall be accompanied by evidence, including an
opinion of counsel if requested, reasonably satisfactory to
the Company (and its counsel) that either:
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(A) the Restricted Warrant is being delivered to the
Guarantor Warrant Agent by a Holder for registration in the
name of such Holder, without transfer; or
(B) the Restricted Warrant is being transferred in reliance
on an exemption from the registration requirements of the
Securities Act.
The term "Restricted Warrant" means any Guarantor Warrant which is evidenced by
a Guarantor Warrant Certificate bearing the Securities Act Legend (as defined
below).
(b) Securities Act Legend.
(i) Except as provided in Subsection 6(b)(iii) below, any
Guarantor Warrants, Guarantor Warrant Shares and any other
securities issued or issuable with respect to any
Restricted Guarantor Warrants or restricted Guarantor
Warrant Shares by way of a stock dividend or stock split or
in connection with a combination of shares,
recapitalization, merger, consolidation or other
reorganization or otherwise shall bear the Securities Act
Legend.
(ii) The Securities Act Legend shall be in substantially the
following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS AND
MAY NOT BE SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR AN
EXEMPTION FROM REGISTRATION THEREUNDER AND PURSUANT TO
REGISTRATION OR QUALIFICATION UNDER ANY APPLICABLE STATE
SECURITIES LAWS OR EXEMPTION THEREFROM.
(iii) Upon any sale or transfer of a Restricted Guarantor
Warrant pursuant to an effective registration statement
under the Securities Act, pursuant to Rule 144 under the
Securities Act or pursuant to an opinion of counsel
reasonably satisfactory to the Company that no Securities
Act Legend is required, the Guarantor Warrant Agent shall
permit the Holder thereof to exchange such Restricted
Guarantor Warrant for a Guarantor Warrant that does not
bear the Securities Act Legend and rescind any restriction
on the transfer of such Restricted Guarantor Warrant.
(c) Obligations with respect to Transfers and Exchanges of Guarantor
Warrants.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Guarantor Warrant Agent is
hereby authorized to countersign, in accordance with the
provisions of Section 5 and this
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Section 6, Guarantor Warrants as required pursuant to the
provisions of this Section 6.
(ii) All Guarantor Warrants issued upon any registration of
transfer or exchange of Guarantor Warrants shall be the
valid obligations of the Company, entitled to the same
benefits under this Guarantor Warrant Agent Agreement, as
the Guarantor Warrants surrendered upon such registration
of transfer or exchange.
(iii) Prior to due presentment for registration of transfer of
any Guarantor Warrant, the Guarantor Warrant Agent and the
Company may deem and treat the person in whose name any
Guarantor Warrant is registered as the absolute owner of
such Guarantor Warrant and neither the Guarantor Warrant
Agent, nor the Company shall be affected by notice to the
contrary.
(iv) No service charge shall be made to a Holder for any
registration, transfer or exchange.
Section 7. Terms of Guarantor Warrants; Exercise of Guarantor
Warrants. Subject to the terms of this Guarantor Warrant Agent Agreement, and
compliance with any applicable law, the registered Holder shall have the right,
until 5:00 p.m., New York City time on the seventh anniversary of the Guaranty
Performance Date (the "Guarantor Warrant Expiration Date") to exercise each
Guarantor Warrant for [ ] fully paid and non-assessable Common Share(s) of the
Company upon the exercise of each Guarantor Warrant and payment of the Guaranty
Exercise Price then in effect.
A Guarantor Warrant may be exercised upon surrender to the Company at
the principal office of the Guarantor Warrant Agent of the certificate or
certificates evidencing the Guarantor Warrant to be exercised with the form of
election to purchase on the reverse thereof duly filled in and signed, which
signature shall be guaranteed by a bank or trust company having an office or
correspondent in the United States or a broker or dealer which is a member of a
registered securities exchange or the National Association of Securities
Dealers, Inc., and upon payment to the Guarantor Warrant Agent for the account
of the Company of the Guaranty Exercise Price for each of the Warrant Shares in
respect of which such Guarantor Warrant is then exercised. Payment of the
aggregate Guaranty Exercise Price shall be made in cash or by certified or
official bank check, payable to the order of the Company, or by wire transfer
pursuant to written instructions of the Guarantor Warrant Agent delivered to a
Holder.
Subject to the provisions of Section 8 hereof, upon surrender of
Guarantor Warrants and payment of the Guaranty Exercise Price as provided above,
the Guarantor Warrant Agent shall thereupon promptly notify the Company, and the
Company shall promptly transfer to the Holder of such Guarantor Warrant
Certificate a certificate or certificates for the appropriate number of
Guarantor Warrant Shares to which the Holder is entitled, registered or
otherwise placed in such name or names as may be directed in writing by the
Holder, and shall deliver such certificate or certificates representing the
Guarantor Warrant Shares to the person or persons entitled to receive the same.
Any such certificate or certificates representing the Guarantor Warrant Shares
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shall be deemed to have been issued and any person so designated to be named
therein shall be deemed to have become a Holder of such Guarantor Warrant Shares
as of the date of the surrender of such Guarantor Warrants and payment of the
Guaranty Exercise Price.
The Guarantor Warrants shall be immediately exercisable, at the
election of the Holders thereof, either in full or from time to time in part
and, in the event that a certificate evidencing Guarantor Warrants is exercised
in respect of fewer than all of the Guarantor Warrant Shares issuable on such
exercise at any time prior to the date of expiration of the Guarantor Warrants,
a new certificate evidencing the remaining Guarantor Warrant or Guarantor
Warrants will be issued, and the Guarantor Warrant Agent is hereby irrevocably
authorized to countersign and to deliver the required new Guarantor Warrant
Certificate or Certificates pursuant to the provisions of this Section and of
Section 4 hereof, and the Company, whenever required by the Guarantor Warrant
Agent, will supply the Guarantor Warrant Agent with Guarantor Warrant
Certificates duly executed on behalf of the Company for such purpose.
All Guarantor Warrant Certificates surrendered upon exercise of
Guarantor Warrants shall be cancelled by the Guarantor Warrant Agent. Such
cancelled Guarantor Warrant Certificates shall then be disposed of by the
Guarantor Warrant Agent in a manner satisfactory to the Company. The Guarantor
Warrant Agent shall account promptly to the Company with respect to Guarantor
Warrants exercised and concurrently pay to the Company all monies received by
the Guarantor Warrant Agent for the purchase of the Guarantor Warrant Shares
through the exercise of such Guarantor Warrants.
The Guarantor Warrant Agent shall keep copies of this Guarantor Warrant
Agent Agreement and any notices given or received hereunder by or from the
Company available for inspection by the Holders during normal business hours at
its office. The Company shall supply the Guarantor Warrant Agent from time to
time with such numbers of copies of this Guarantor Warrant Agent Agreement as
the Guarantor Warrant Agent may request.
Section 8. Payment of Taxes. No service charge shall be made to the
Holder for any exercise, exchange or registration of transfer of a Guarantor
Warrant Certificate, and the Company will pay all documentary stamp taxes
attributable to the initial issuance of Guarantor Warrant Shares upon the
exercise of Guarantor Warrants; provided, 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 issue of any new certificates evidencing the Guarantor Warrants or any
certificates for Guarantor Warrant Shares in a name other than that of the
registered Holder upon the exercise of Guarantor Warrants, and the Company or
the Guarantor Warrant Agent shall not be required to issue or deliver such new
certificates evidencing the Guarantor Warrants or certificates for Guarantor
Warrant Shares unless or until the person or persons requesting the issuance
thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been paid.
Section 9. Adjustments. The number of Guarantor Warrant Shares and the
Guarantor Warrant Exercise Price shall be subject to adjustments as provided in
Section 5 of the form of the Guarantor Warrant Certificate attached as Exhibit A
hereto.
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Section 10. Mutilated or Missing Guarantor Warrant Certificates. If any
Guarantor Warrant Certificate shall be mutilated, lost, stolen or destroyed, the
Company may in its discretion issue and the Guarantor Warrant Agent may
countersign in exchange and substitution for, and upon cancellation of, the
Guarantor Warrant Certificate, if mutilated or in lieu of and substitution for
the Guarantor Warrant Certificate, if lost, stolen or destroyed, a new
certificate of like tenor evidencing an equal number of Guarantor Warrants, but
only upon receipt of evidence reasonably satisfactory to the Company and
Guarantor Warrant Agent of such loss, theft or destruction and indemnity and
security therefor, if requested, also satisfactory to the Company and the
Guarantor Warrant Agent. Applicants for such substitute Guarantor Warrant
Certificate shall also comply with such other reasonable regulations and pay
such other reasonable charges as the Company or Guarantor Warrant Agent may
prescribe.
Section 11. Reservation of Guarantor Warrant Shares. The Company will
at all times reserve and keep available, free from preemptive rights, or any
other actual contingent purchase rights of persons other than the Holders out of
the aggregate of its authorized but unissued Common Shares, for the purpose of
enabling it to satisfy any obligation to issue Guarantor Warrant Shares upon
exercise of Guarantor Warrants, the maximum number of Common Shares which may
then be deliverable upon the exercise of all outstanding Guarantor Warrants.
The transfer agent for the Common Stock (the "Transfer Agent") and
every subsequent transfer agent for any shares of the Company's capital stock
issuable upon the exercise of any of the rights of purchase aforesaid will be
irrevocably authorized and directed at all times to reserve such number of
authorized shares as shall be required for such purpose. The Company will keep a
copy of this Agreement on file with the Transfer Agent and with every subsequent
transfer agent for any shares of the Company's capital stock issuable upon the
exercise of the rights of purchase represented by the Guarantor Warrants. The
Guarantor Warrant Agent is hereby irrevocably authorized to requisition from
time to time from such Transfer Agent the stock certificates required to honor
outstanding Guarantor Warrants upon exercise thereof in accordance with the
terms of this Agreement. The Company will supply such Transfer Agent with duly
executed certificates for such purposes. The Company will furnish such Transfer
Agent a copy of all notices of adjustments and certificates related thereto,
transmitted to each Holder of the Guarantor Warrants pursuant to this Guarantor
Warrant Agent Agreement.
The Company covenants that all Warrant Shares which may be issued upon
exercise of Guarantor Warrants will be, upon payment or other satisfaction of
the Guaranty Exercise Price and issuance thereof, fully paid, nonassessable,
free of preemptive rights and free from all taxes, liens, charges and security
interests with respect to the issue thereof.
Section 12. Fractional Interests. The Company shall not be required to
issue fractional Guarantor Warrant Shares upon the exercise of Guarantor
Warrants. If more than one Guarantor Warrant shall be presented for exercise at
the same time by the Holder, the full number of Guarantor Warrant Shares which
shall be issuable upon the exercise thereof shall be computed on the basis of
the aggregate number of Guarantor Warrant Shares purchasable on exercise of the
Guarantor Warrants so presented. If any fraction of a Guarantor Warrant Share
would, except for the provisions of this Section 12, be issuable on the exercise
of any Guarantor Warrant, the actual distribution of Guarantor Warrant Shares
shall reflect a rounding down of such fraction to
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the nearest whole share, with any excess proceeds as a result of such rounding
being refunded to the Holder.
Section 13. Merger, Consolidation or Change of Name of Guarantor
Warrant Agent. Any corporation into which the Guarantor Warrant Agent may be
merged or with which it may be consolidated, or any corporation resulting from
any merger or consolidation to which the Guarantor Warrant Agent shall be a
party, or any corporation succeeding to the business of the Guarantor Warrant
Agent, shall be the successor to the Guarantor Warrant Agent hereunder without
the execution or filing of any paper or any further act on the part of any of
the parties hereto; provided, that such corporation would be eligible for
appointment as a successor warrant agent under the provisions of Section 15. Any
such successor Guarantor Warrant Agent shall promptly cause notice of its
succession as Guarantor Warrant Agent to be mailed (by first class mail, postage
prepaid) to each Holder at such Holder's last address as shown on the register
maintained by the Guarantor Warrant Agent pursuant this Guarantor Warrant Agent
Agreement. In case at the time such successor to the Guarantor Warrant Agent
shall succeed to the agency created by this Guarantor Warrant Agent Agreement,
and in case at that time any of the Guarantor Warrant Certificates shall have
been countersigned but not delivered, any such successor to the Guarantor
Warrant Agent may adopt the countersignature of the original Guarantor Warrant
Agent; and in case at that time any of the Guarantor Warrant Certificates shall
not have been countersigned, any successor to the Guarantor Warrant Agent may
countersign such Guarantor Warrant Certificates either in the name of the
predecessor Guarantor Warrant Agent or in the name of the successor to the
Guarantor Warrant Agent; and in all such cases such Guarantor Warrant
Certificates shall have the full force and effect provided in the Guarantor
Warrant Certificates and in this Guarantor Warrant Agent Agreement.
In case at any time the name of the Guarantor Warrant Agent shall be
changed and at such time any of the Guarantor Warrant Certificates shall have
been countersigned but not delivered, the Guarantor Warrant Agent whose name has
been changed may adopt the countersignature under its prior name, and in case at
that time any of the Guarantor Warrant Certificates shall not have been
countersigned, the Guarantor Warrant Agent may countersign such Guarantor
Warrant Certificates either in its prior name or in its changed name, and in all
such cases such Guarantor Warrant Certificates shall have the full force and
effect provided in the Guarantor Warrant Certificates and in this Guarantor
Warrant Agent Agreement.
Section 14. Guarantor Warrant Agent. The Guarantor Warrant Agent
undertakes the duties and obligations imposed by this Guarantor Warrant Agent
Agreement upon the following terms and conditions, by all of which the Company
and the Holders of Guarantor Warrants, by their acceptance thereof, shall be
bound:
(a) The statements contained herein and in the Guarantor Warrant
Certificates shall be taken as statements of the Company and the Guarantor
Warrant Agent assumes no responsibility for the correctness of any of the same
except such as describe the Guarantor Warrant Agent or action taken or to be
taken by it. The Guarantor Warrant Agent assumes no responsibility with respect
to the distribution of the Guarantor Warrant Certificates except as herein
otherwise provided.
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(b) The Guarantor Warrant Agent shall not be responsible for any failure
of the Company to comply with any of the covenants contained in this Guarantor
Warrant Agent Agreement or in the Guarantor Warrant Certificates to be complied
with by the Company.
(c) The Guarantor Warrant Agent may consult at any time with counsel
satisfactory to it (who may be counsel for the Company) and the Guarantor
Warrant Agent shall incur no liability or responsibility to the Company or to
any Holder of any Guarantor Warrant Certificate in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance with the
opinion or the advice of such counsel.
(d) The Guarantor Warrant Agent shall incur no liability or
responsibility to the Company or to any Holder of any Guarantor Warrant
Certificate for any action taken in reliance on any Guarantor Warrant
Certificate, certificate of shares, notice, resolution, waiver, consent, order,
certificate, or other paper, document or instrument believed by it to be genuine
and to have been signed, sent or presented by the proper party or parties.
(e) The Company agrees to pay to the Guarantor Warrant Agent reasonable
compensation for all services rendered by the Guarantor Warrant Agent in the
execution of this Guarantor Warrant Agent Agreement, to reimburse the Guarantor
Warrant Agent for all expenses, taxes and governmental charges and other charges
of any kind and nature reasonably incurred by the Guarantor Warrant Agent in the
execution of this Guarantor Warrant Agent Agreement and to indemnify the
Guarantor Warrant Agent and save it harmless against any and all liabilities,
including judgments, reasonable costs and counsel fees, for anything done or
omitted by the Guarantor Warrant Agent in the execution of this Guarantor
Warrant Agent Agreement except as a result of its negligence or bad faith.
(f) The Guarantor Warrant Agent shall be under no obligation to
institute any action, suit or legal proceeding or to take any other action
likely to involve expense unless the Company or one or more Holders of Guarantor
Warrant Certificates shall furnish the Guarantor Warrant Agent with reasonable
security and indemnity for any costs and expenses which may be incurred, but
this provision shall not affect the power of the Guarantor Warrant Agent to take
such action as it may consider proper, whether with or without any such security
or indemnity. All rights of action under this Guarantor Warrant Agent Agreement
or under any of the Guarantor Warrants may be enforced by the Guarantor Warrant
Agent without the possession of any of the Guarantor Warrant Certificates or the
production thereof at any trial or other proceeding relative thereto, and any
such action, suit or proceeding instituted by the Guarantor Warrant Agent shall
be brought in its name as Guarantor Warrant Agent and any recovery of judgment
shall be for the ratable benefit of the Holders of the Guarantor Warrants, as
their respective rights or interests may appear.
(g) The Guarantor Warrant Agent, and any stockholder, director, officer
or employee of it, may buy, sell or deal in any of the Guarantor Warrants or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though it were not
Guarantor Warrant Agent under this Guarantor Warrant Agent Agreement. Nothing
herein shall preclude the Guarantor Warrant Agent from acting in any other
capacity for the Company or for any other legal entity.
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(h) The Guarantor Warrant Agent shall act hereunder solely as agent for
the Company, and its duties shall be determined solely by the provisions hereof.
The Guarantor Warrant Agent shall not be liable for anything which it may do or
refrain from doing in connection with this Guarantor Warrant Agent Agreement
except for its own negligence or bad faith.
(i) The Guarantor Warrant Agent shall not at any time be under any duty
or responsibility to any Holder of any Warrant Certificate to make or cause to
be made any adjustment of the Guaranty Exercise Price or number of the Warrant
Shares or other securities or property deliverable as provided in this Guarantor
Warrant Agent Agreement, or to determine whether any facts exist which may
require any of such adjustments, or with respect to the nature or extent of any
such adjustments, when made, or with respect to the method employed in making
the same. The Guarantor Warrant Agent shall not be accountable with respect to
the validity or value or the kind or amount of any Warrant Shares or of any
securities or property which may at any time be issued or delivered upon the
exercise of any Guarantor Warrant or with respect to whether any such Warrant
Shares or other securities will when issued be validly issued and fully paid and
nonassessable, and makes no representation with respect thereto.
(j) The Guarantor Warrant Agent shall be entitled to rely on the
statements of the Company and the Holders, and shall be under no duty or
responsibility with respect to any such statements.
(k) The Guarantor Warrant Agent shall not be responsible for any failure
of the Company to make any cash payment or to issue, transfer or deliver any
shares of Common Stock or stock certificates or other common stock or property
upon the exercise of any Guarantor Warrant.
Section 15. Resignation and Removal of Guarantor Warrant Agent;
Appointment of Successor. No resignation or removal of the Guarantor Warrant
Agent and no appointment of a successor warrant agent shall become effective
until the acceptance of appointment by the successor warrant agent as provided
herein. The Guarantor Warrant Agent may resign its duties and be discharged from
all further duties and liability hereunder (except liability arising as a result
of the Guarantor Warrant Agent's own negligence of willful misconduct) after
giving written notice to the Company. The Company may remove the Guarantor
Warrant Agent upon written notice, and the Guarantor Warrant Agent shall
thereupon in like manner be discharged from all further duties and liabilities
hereunder, except as aforesaid. The Guarantor Warrant Agent shall, at the
Company's expense, mail (by first class mail, postage prepaid) to each Holder of
a Guarantor Warrant at his last address as shown on the register of the Company
maintained by the Guarantor Warrant Agent a copy of said notice of resignation
or notice of removal, as the case may be. Upon such resignation or removal, the
Company shall appoint in writing a new warrant agent. If the Company shall fail
to make such appointment within a period of 30 days after it has been notified
in writing of such resignation by the resigning Guarantor Warrant Agent or after
such removal, then the resigning Guarantor Warrant Agent or the Holder of any
Guarantor Warrant may apply to any court of competent jurisdiction for the
appointment of a new warrant agent. Any new warrant agent, whether appointed by
the Company or by such a court, shall be a corporation doing business under the
laws of the United States or any state thereof, in good standing and having a
combined capital and surplus of not less than
11
$50,000,000. The combined capital and surplus of any such new warrant agent
shall be deemed to be the combined capital and surplus as set forth in the most
recent annual report of its condition published by such warrant agent prior to
its appointment, provided that such reports are published at least annually
pursuant to law or to the requirements of a federal or state supervising or
examining authority. After acceptance in writing of such appointment by the new
warrant agent, it shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named herein as the Guarantor
Warrant Agent, without any further assurance, conveyance, act or deed; but if
for any reason it shall be necessary or expedient to execute and deliver any
further assurance, conveyance, act or deed, the same shall be done at the
expense of the Company and shall be legally and validly executed and delivered
by the resigning or removed Guarantor Warrant Agent. Not later than the
effective date of any such appointment, the Company shall give notice thereof to
the resigning or removed Guarantor Warrant Agent. Failure to give any notice
provided for in this Section, however, or any defect therein, shall not affect
the legality or validity of the resignation of the Guarantor Warrant Agent or
the appointment of a new warrant agent, as the case may be.
Section 16. Notices to Company and Guarantor Warrant Agent. Any notice or
demand authorized or required by this Guarantor Warrant Agent Agreement to be
given or made by the Guarantor Warrant Agent or by the Holder of any Warrant
Certificate to or on the Company shall be sufficiently given or made when and if
deposited in the mail, first class or registered, postage prepaid, addressed
(until another address is filed in writing by the Company with the Guarantor
Warrant Agent), as follows:
Seitel, Inc.
00000 X. Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: General Counsel
With a copy to:
Xxxxxxxxx Xxxxxxx, LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
And separately to:
Mellon HBV Alternative Strategies LLC
000 Xxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxx X. Kononmos
12
With a copy to:
Milbank, Tweed, Xxxxxx & XxXxxx
0 Xxxxx Xxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx
In case the Company shall fail to maintain such office or agency or shall
fail to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the
principal office of the Guarantor Warrant Agent.
Any notice pursuant to this Guarantor Warrant Agent Agreement to be given
by the Company or by the Holder(s) of any Warrant Certificate to the Guarantor
Warrant Agent shall be sufficiently given when and if deposited in the mail,
first-class or registered, postage prepaid, addressed (until another address is
filed in writing by the Guarantor Warrant Agent with the Company) to the
Guarantor Warrant Agent as follows:
American Stock Transfer & Trust Company
00 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Attention: Office of the General Counsel
Section 17. Supplements and Amendments. The Company and the Guarantor
Warrant Agent may from time to time supplement or amend this Guarantor Warrant
Agent Agreement without the approval of any Holders of Warrant Certificates in
order to cure any ambiguity or to correct or supplement any provision contained
herein which may be defective or inconsistent with any other provision herein,
or to make any other provisions in regard to matters or questions arising
hereunder which the Company and the Guarantor Warrant Agent may deem necessary
or desirable and which shall not in any way adversely affect the interests of
the Holders of Guarantor Warrant Certificates. The Guarantor Warrant Agent shall
be entitled to receive and, subject to Section 14, shall be fully protected in
relying upon, an officers' certificate and opinion of counsel as conclusive
evidence that any such amendment or supplement is authorized or permitted
hereunder, that it is not inconsistent herewith, and that it will be valid and
binding upon the Company in accordance with its terms.
Section 18. Successors. All the covenants and provisions of this
Guarantor Warrant Agent Agreement by or for the benefit of the Company or the
Guarantor Warrant Agent shall bind and inure to the benefit of their respective
successors and assigns hereunder.
Section 19. Termination. This Guarantor Warrant Agent Agreement (other
than the Guarantor Warrant Agent's obligations under Section 7, and any party's
obligations with respect to Guarantor Warrants previously exercised, and with
respect to indemnification under Section 14) shall terminate at 5:00 p.m., New
York City time, on the Guarantor Warrant Expiration Date.
Section 20. Governing Law. This Guarantor Warrant Agent Agreement and
each Warrant Certificate issued hereunder shall be deemed to be a contract made
under the laws of the
13
state of New York and for all purposes shall be construed in accordance with the
internal laws of said state.
Section 21. Benefits of This Guarantor Warrant Agent Agreement.
(a) Nothing in this Guarantor Warrant Agent Agreement shall be construed
to give to any person or corporation other than the Company, the Guarantor
Warrant Agent and the Holders of the Guarantor Warrant Certificates any legal or
equitable right, remedy or claim under this Guarantor Warrant Agent Agreement;
but this Guarantor Warrant Agent Agreement shall be for the sole and exclusive
benefit of the Company, the Guarantor Warrant Agent and the Holders of the
Guarantor Warrant Certificates.
(b) Prior to the exercise of the Guarantor Warrants, no Holder of a
Guarantor Warrant Certificate, as such, shall be entitled to any rights of a
stockholder of the Company, including, without limitation, the right to receive
dividends or subscription rights, the right to vote, to consent, to exercise any
preemptive right, to receive any notice of meetings of stockholders for the
election of directors of the Company or any other matter or to receive any
notice of any proceedings of the Company, except as may be specifically provided
for herein. The Holders of the Guarantor Warrants are not entitled to share in
the assets of the Company in the event of the liquidation, dissolution or
winding up of the Company's affairs.
(c) All rights of action in respect of this Guarantor Warrant Agent
Agreement are vested in the Holders of the Guarantor Warrants, and any Holder of
any Guarantor Warrant, without the consent of the Guarantor Warrant Agent or the
Holder of any other Guarantor Warrant, may, on such Holder's own behalf and for
such Holder's own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company suitable to enforce, or otherwise in
respect of, such Holder's rights hereunder, including the right to exercise,
exchange or surrender for purchase such Holder's Guarantor Warrants in the
manner provided in this Guarantor Warrant Agent Agreement.
Section 22. Counterparts. This Guarantor Warrant Agent Agreement may be
executed in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts shall
together constitute but one and the same instrument.
14
IN WITNESS WHEREOF, the parties hereto have caused this Guarantor Warrant
Agent Agreement to be duly executed, as of the day and year first above written.
SEITEL, INC.
By:______________________
Name:
Title:
[Seal]
Attest:_____________________
Secretary
AMERICAN STOCK TRANSFER & TRUST COMPANY
By:______________________
Name:
Title:
[Seal]
Attest:_____________________
Secretary
15
EXHIBIT A
FORM OF FUNDING GUARANTOR WARRANT
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH
OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT
TO A TRANSACTION WHICH, IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY
TO THE COMPANY, IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION.
Warrant Number FGW- [____________], 2004
This Funding Guarantor Warrant expires 5:00 P.M., New York time on
[_______________], 2011.
Warrant to Purchase up to [____________] shares of Common Stock of
Seitel, Inc. (hereinafter, the "Funding Guarantor Warrant").
FOR VALUE RECEIVED, the receipt and sufficiency of which are hereby
acknowledged, [__________________________] (the "Initial Holder" and, together
with any permitted transferee under this Funding Guarantor, the "Holder", or its
registered assigns) is entitled to purchase from Seitel, Inc., a Delaware ------
corporation (the "Company"), on the terms and conditions set forth below, to
purchase from the Company at any time during the Exercise Period ending 5:00
P.M., New York time, on [____________], 2011 (as defined below) up to [________]
fully paid and nonassessable shares of Common Stock, par value $.01 per share,
of the Company (the "Common Stock"), as the same may be adjusted from time to
time pursuant to Section 5 hereof, at an initial exercise price of $.72 per
share as the same may be adjusted pursuant to Section 5 hereof. The resale of
the shares of Common Stock or other securities issuable upon exercise or
exchange of this Funding Guarantor Warrant is subject to the provisions of the
Registration Rights Agreement (as defined below). This Funding Guarantor Warrant
is issued pursuant to a Standby Purchase Agreement entered into between the
Company and certain Funding Guarantors dated [__________], 2004. This Funding
Guarantor Warrant is one of [______] warrants of like tenor aggregating the
right to purchase [___________] shares of Common Stock.
A-1
Section 1. Definitions.
"Aggregate Exercise Price" shall mean, with respect to any exercise (in
whole or in part) of this Funding Guarantor Warrant the Exercise Price
multiplied by the total number of shares of Common Stock for which this Funding
Guarantor Warrant is being exercised.
"Capital Shares" shall mean the Common Stock and any shares of any other
class of common stock whether now or hereafter authorized, having the right to
participate in the distribution of dividends (as and when declared) or assets
(upon liquidation of the Company).
"Common Stock" shall mean the common stock, par value $.01 per share, of
the Company, and any other capital stock of the Company into which such common
stock may be converted or reclassified or that may be issued in respect of, in
exchange for, or in substitution for, such common stock by reason of any stock
splits, stock dividends, distributions, mergers, consolidations or other like
events.
"Company" shall mean Seitel, Inc., a Delaware corporation, and its
successors and assigns.
"Exercise Date" shall mean, with respect to any exercise (in whole or in
part) of this Funding Guarantor Warrant either (i) the date this Funding
Guarantor Warrant, the Exercise Notice and the Aggregate Exercise Price are
received by the Company or (ii) the date a copy of the Exercise Notice is sent
by facsimile to the Funding Guarantor Agent, provided that this Funding
Guarantor Warrant, the original Exercise Notice, and the Aggregate Exercise
Price are received by the Funding Guarantor Agent within five Trading Days
thereafter and provided further that if this Funding Guarantor Warrant, the
original Exercise Notice and the Aggregate Exercise Price are not received
within five Trading Days in accordance with clause (ii) above, the Exercise Date
for this clause (ii) shall be the date that the Funding Guarantor Agent receives
this Funding Guarantor Warrant, the original Exercise Notice and the Aggregate
Exercise Price.
"Exercise Notice" shall mean, with respect to any exercise (in whole or
in part) of this Funding Guarantor Warrant the exercise form attached hereto as
Exhibit A, duly executed by the Holder.
"Exercise Period" shall mean the period beginning on the date hereof and
continuing until 5:00 P.M., New York time, on [_____________], 2011, at which
time this Funding Guarantor Warrant shall expire and be of no further force or
effect or represent any rights hereunder.
"Exercise Price" as of the date hereof shall mean $.72 per share of
Common Stock, subject to the adjustments provided for in Section 5 of this
Funding Guarantor Warrant.
"Funding Guarantor Warrant" shall mean this warrant.
"Funding Guarantor Shares" shall mean shares of Common Stock issuable by
the Company upon the exercise of this Funding Guarantor and the payment to the
Company of the Aggregate Exercise Price.
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"Holder" shall mean a person registered as the owner of the Funding
Guarantor Warrant.
"Registration Rights Agreement" shall mean the Registration Rights
Agreement, dated [____________], 2004, between the Company and the Funding
Guarantors.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Trading Day" shall mean a day when the New York Stock Exchange is open
for business and all trading on such Exchange has not been halted or suspended.
"Funding Guarantor Agent" shall mean American Stock Transfer and Trust
Company.
Other capitalized terms used but not defined herein shall have their
respective meanings set forth in the Guarantor Warrant Agent Agreement.
Section 2. Exercise.
(a) Method of Exercise. This Funding Guarantor Warrant may be
exercised in whole or in part (but not as to a fractional share of Common
Stock), at any time and from time to time during the Exercise Period, by the
Holder by (i) the surrender of this Funding Guarantor Warrant, the Exercise
Notice in the form of Exhibit A attached hereto with signature guaranteed as
provided in Section 17Ad of the Securities and Exchange Act of 1934, as amended,
and the Aggregate Exercise Price to the Company at the principal office of the
Funding Guarantor Agent at the address set forth in Section 10 hereof or (ii)
the delivery by facsimile of an executed and completed Exercise Notice to the
Company at the principal office of the Funding Guarantor Agent at the address
set forth in Section 10 hereof and delivery to the Company at the principal
office of the Funding Guarantor Agent at the address set forth in Section 10
hereof within five Trading Days thereafter of this Funding Guarantor Warrant,
the original Exercise Notice and the Aggregate Exercise Price.
(b) Payment of Aggregate Exercise Price. Payment of the Aggregate
Exercise Price shall be made by cash, certified or official bank check payable
to the order of the Company or by wire transfer to an account designated by the
Company. If the amount of the payment received by the Company is less than the
Aggregate Exercise Price, the Holder will be notified of the deficiency and
shall make payment in that amount within 5 consecutive Trading Days of such
notice. In the event the payment exceeds the Aggregate Exercise Price, the
Company will refund the excess to the Holder within 3 Trading Days of both the
receipt of such payment and the knowledge of such excess.
(c) Replacement Warrant. In the event that the Funding Guarantor
Warrant is not exercised in full, the number of Funding Guarantor Warrant Shares
shall be reduced by the number of such Funding Guarantor Warrant Shares for
which this Funding Guarantor Warrant is exercised, and the Company, at its
expense, shall forthwith issue and deliver to the Holder a new Funding Guarantor
Warrant of like tenor in the name of the Holder or as the Holder may request,
reflecting such adjusted number of Funding Guarantor Warrant Shares.
A-3
Section 3. Delivery of Stock Certificates.
(a) Subject to the terms and conditions of this Funding Guarantor
Warrant, as soon as practicable after the exercise of this Funding Guarantor
Warrant in full or in part, and receipt by the Funding Guarantor Agent of good
funds, and in any event within seven (7) Trading Days thereafter, the Company at
its expense (including, without limitation, the payment by it of any applicable
issue taxes) will cause to be issued in the name of and delivered to the Holder,
or as the Holder lawfully may direct, a certificate or certificates for the
number of validly issued, fully paid and non-assessable Funding Guarantor
Warrant Shares to which the Holder shall be entitled on such exercise, together
with any other stock or other securities or property (including cash, where
applicable) to which the Holder is entitled upon such exercise in accordance
with the provisions hereof; provided, however, that any such delivery to a
location outside of the United States also shall be made within five Trading
Days after the exercise of this Funding Guarantor Warrant in full or in part.
(b) This Funding Guarantor Warrant may not be exercised as to
fractional shares of Common Stock. In the event that the exercise of this
Funding Guarantor Warrant, in full or in part, would result in the right to
acquire any fractional share of Common Stock, then in such event such fractional
share shall be considered a whole share of Common Stock and shall be added to
the number of Funding Guarantor Warrant Shares issuable to the Investor upon
exercise of this Funding Guarantor Warrant.
Section 4. Representations, Warranties and Covenants of the Company.
(a) The Company shall take all necessary action and proceedings
as may be required and permitted by applicable law, rule and regulation for the
legal and valid issuance of this Funding Guarantor Warrant and the Funding
Guarantor Warrant Shares to the Holder.
(b) The Funding Guarantor Warrant Shares, when issued in
accordance with the terms hereof, will be duly authorized and, when paid for or
issued in accordance with the terms hereof, shall be validly issued, fully paid
and non-assessable.
(c) The Company has authorized and reserved for issuance to the
Holder the requisite number of shares of Common Stock to be issued pursuant to
this Funding Guarantor Warrant. The Company at all times shall reserve and keep
available, solely for issuance and delivery as Funding Guarantor Warrant Shares
hereunder, such shares of Common Stock as from time to time shall be issuable as
Funding Guarantor Warrant Shares, and accordingly shall adjust the number of
such shares of Common Stock promptly upon the occurrence of any of the events
specified in Section 5 hereof.
Section 5. Adjustment of the Exercise Price. The Exercise Price and,
accordingly, the number of Funding Guarantor Warrant Shares issuable upon
exercise of the Funding Guarantor Warrant, shall be subject to adjustment from
time to time upon the happening of certain events as follows:
(a) Reclassification, Consolidation, Merger; Mandatory Share
Exchange; Sale Transfer or Lease of Assets. If the Company, at any time while
this Funding Guarantor Warrant is unexpired and not exercised in full, (i)
reclassifies or changes its outstanding Capital Shares
A-4
(other than a change in par value, or from par value to no par value per share,
or from no par value per share to par value or as a result of a subdivision or
combination of outstanding securities issuable upon exercise of this Funding
Guarantor Warrant) or (ii) consolidates, merges or effects a mandatory share
exchange (x) with or into another corporation (other than a merger or mandatory
share exchange with another corporation in which the Company is a continuing
corporation and that does not result in any reclassification or change, other
than a change in par value, or from par value to no par value per share, or from
no par value per share to par value, or (y) as a result of a subdivision or
combination of outstanding Capital Shares issuable upon exercise of the Funding
Guarantor Warrant) or (iii) sells, transfers or leases all or substantially all
of its assets, then in any such event the Company, or such successor or
purchasing corporation, as the case may be, shall, without payment by the Holder
of any additional consideration therefor, amend this Funding Guarantor Warrant
or issue a new warrant providing that the Holder shall have rights not less
favorable to the Holder than those then applicable to this Funding Guarantor
Warrant and to receive upon exercise under such amendment of this Funding
Guarantor Warrant or new warrant, in lieu of each share of Common Stock
theretofore issuable upon exercise of this Funding Guarantor Warrant hereunder,
the kind and amount of shares of stock, other securities, money or property
receivable upon such reclassification, change, consolidation, merger, mandatory
share exchange, lease, sale or transfer by the holder of one share of Common
Stock issuable upon exercise of the Funding Guarantor Warrant had this Funding
Guarantor Warrant been exercised immediately prior to such reclassification,
change, consolidation, merger, mandatory share exchange or sale or transfer, and
an appropriate provision for the foregoing shall be made by the Company as part
of any such event. Such amended Funding Guarantor Warrant or new warrant shall
provide for adjustments that shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Section 5. The provisions of this
Section 5(a) shall similarly apply to successive reclassifications, changes,
consolidations, mergers, mandatory share exchanges, sales, transfers and leases.
(b) Subdivision or Combination of Shares; Stock Dividends. If the
Company, at any time while this Funding Guarantor Warrant is unexpired and not
exercised in full, shall subdivide its Common Stock, combine its Common Stock,
pay a dividend in its Capital Shares, or make any other distribution of its
Capital Shares, then the Exercise Price shall be adjusted, as of the date the
Company shall take a record of the holders of its Capital Shares for the purpose
of effecting such subdivision, combination or dividend or other distribution (or
if no such record is taken, as of the effective date of such subdivision,
combination, dividend or other distribution), to that price determined by
multiplying the Exercise Price in effect immediately prior to such subdivision,
combination, dividend or other distribution by a fraction:
(i) the numerator of which shall be the total number of
Outstanding Capital Shares immediately prior to such subdivision, combination,
dividend or other distribution, and
(ii) the denominator of which shall be the total number of
Outstanding Capital Shares immediately after such subdivision, combination,
dividend or other distribution. The provisions of this Section 5(b) shall not
apply under any of the circumstances for which an adjustment is made pursuant to
Section 5(a).
A-5
(c) Liquidating Dividends, Etc. If the Company, at any time while this
Funding Guarantor Warrant is unexpired and not exercised in full, makes a
distribution of its assets or evidences of indebtedness to the holders of its
Capital Shares as a dividend in liquidation or by way of return of capital or
other than as a dividend payable out of earnings or surplus legally available
for dividends under applicable law or any distribution to such holders made in
respect of the sale of all or substantially all of the Company's assets, or any
spin-off of any of the Company's lines of business, divisions or subsidiaries
(other than under the circumstances provided for in the foregoing subsections
(a) and (b)), then the Holder shall be entitled to receive upon such exercise of
the Funding Guarantor Warrant in addition to the Funding Guarantor Warrant
Shares receivable in connection therewith, and without payment of any
consideration other than the Exercise Price, an amount in cash equal to the
value of such distribution per Capital Share multiplied by the number of Funding
Guarantor Warrant Shares that, on the record date for such distribution, are
issuable upon such exercise of the Funding Guarantor Warrant, and an appropriate
provision therefor shall be made by the Company as part of any such
distribution. The value of a distribution that is paid in other than cash shall
be determined in good faith by the Board of Directors of the Company.
(d) Adjustment of Number of Shares. Upon each adjustment of the
Exercise Price pursuant to any provisions of this Section 5, the number of
Funding Guarantor Warrant Shares issuable hereunder at the option of the Holder
shall be calculated, to the nearest one hundredth of a whole share, multiplying
the number of Funding Guarantor Warrant Shares issuable prior to an adjustment
by a fraction:
(i) the numerator of which shall be the Exercise Price before
any adjustment pursuant to this Section 5; and
(ii) the denominator of which shall be the Exercise Price after
such adjustment.
(e) Notice of Certain Actions. In the event the Company shall, at a
time while the Funding Guarantor Warrant is unexpired and outstanding, take any
action pursuant to subsections (a) through (d) of this Section 5 that may result
in an adjustment of the Exercise Price, the Company shall notify the Holder of
such action 10 days in advance of its effective date in order to afford to the
Holder an opportunity to exercise the Funding Guarantor Warrant prior to such
action becoming effective.
(f) Notice of Adjustments. Whenever the Exercise Price or number of
Funding Guarantor Warrant Shares shall be adjusted pursuant to Section 5 hereof,
the Company shall promptly deliver by facsimile, with the original delivered by
express courier service in accordance with Section 10 hereof, a certificate,
which shall be signed by the Company's President or a Vice President and by its
Treasurer or Assistant Treasurer or its Secretary or Assistant Secretary,
setting forth in reasonable detail the event requiring the adjustment, the
amount of the adjustment, the method by which such adjustment was calculated
(including a description of the basis on which the Company's Board of Directors
made any determination hereunder), and the Exercise Price and number of Funding
Guarantor Warrant Shares purchasable at that Exercise Price after giving effect
to such adjustment.
A-6
Section 6. No Impairment. The Company will not, by amendment of its
Certificate or By-Laws or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms of this Funding Guarantor Warrant, but will at all times in good faith
assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
Holder against impairment. Without limiting the generality of the foregoing, the
Company (a) will not increase the par value of any Funding Guarantor Warrant
Shares above the amount payable therefor on such exercise, and (b) will take all
such action as may be reasonably necessary or appropriate in order that the
Company may validly and legally issue fully paid and nonassessable Funding
Guarantor Warrant Shares on the exercise of this Funding Guarantor Warrant.
Section 7. Rights As Stockholder. Prior to exercise of this Funding
Guarantor Warrant and except as provided in Section 5 hereof, the Holder shall
not be entitled to any rights as a stockholder of the Company with respect to
the Funding Guarantor Warrant Shares, including (without limitation) the right
to vote such shares, receive dividends or other distributions thereon or be
notified of stockholder meetings. However, in the event of any taking by the
Company of a record of the holders of any class of securities for the purpose of
determining the holders thereof who are entitled to receive any dividend (other
than a cash dividend) or other distribution, any right to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right, the Company shall mail to
each Holder, at least 10 days prior to the date specified therein, a notice
specifying the date on which any such record is to be taken for the purpose of
such dividend, distribution or right, and the amount and character of such
dividend, distribution or right.
Section 8. Replacement of Funding Guarantor Warrant. Upon receipt of
evidence reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of the Funding Guarantor Warrant and, in the case of any such
loss, theft or destruction of the Funding Guarantor Warrant, upon delivery of an
indemnity agreement or security reasonably satisfactory in form and amount to
the Company or, in the case of any such mutilation, on surrender and
cancellation of such Funding Guarantor Warrant, the Company at its expense will
execute and deliver, in lieu thereof, a new Funding Guarantor Warrant of like
tenor.
Section 9. Restricted Securities.
(a) Registration or Exemption Required. This Funding Guarantor Warrant
has been issued in a transaction exempt from the registration requirements of
the Securities Act in reliance upon Section 4(2) of the Securities Act. This
Funding Guarantor Warrant and the Funding Guarantor Warrant Shares issuable upon
exercise of this Funding Guarantor Warrant may not be resold except pursuant to
an effective registration statement or an exemption to the registration
requirements of the Securities Act and applicable state laws.
(b) Legend. Any replacement Funding Guarantor Warrants issued pursuant
to Section 2 hereof and any Funding Guarantor Warrant Shares issued upon
exercise hereof, shall bear the following legend:
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"THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR ANY OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN
RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED, HYPOTHECATED OR OTHERWISE
DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO A TRANSACTION WHICH, IN THE
OPINION OF COUNSEL REASONABLE SATISFACTORY TO THE COMPANY, IS EXEMPT
FROM, OR NOT SUBJECT TO, SUCH REGISTRATION."
Removal of such legend shall be in accordance with the legend removal provisions
in the Funding Agreement.
(c) Assignment. Assuming the conditions of Section 9(a) above
regarding registration or exemption have been satisfied, the Holder may sell,
transfer, assign, pledge or otherwise dispose of this Funding Guarantor Warrant,
in whole or in part. The Holder shall deliver a written notice to the Funding
Guarantor Agent substantially in the form of the assignment form attached hereto
as Exhibit B (the "Assignment Notice") indicating the person or persons to whom
this Funding Guarantor Warrant shall be assigned and the respective number of
warrants to be assigned to each assignee. The Company shall effect the
assignment within ten days of receipt of such Assignment Notice, and shall
deliver to the assignee(s) designated by the Holder a Funding Guarantor Warrant
or Funding Guarantor Warrants of like tenor and terms for the specified number
of shares. No service charge shall be made to the Holder for any exercise,
exchange or registration of transfer of a Funding Guarantor Certificate, and the
Company will pay all documentary stamp taxes attributable to the initial
issuance of Funding Guarantor Shares upon the exercise of the Funding Guarantor
Warrants; provided, 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 issue of
any new certificates evidencing the Funding Guarantor Warrants or any
certificates for the Funding Guarantor Warrant Shares in a name other than that
of the registered Holder upon the exercise of Funding Guarantor Warrants, and
the Company shall not be required to issue or deliver such new certificates
evidencing the Funding Guarantor Warrants or certificates for Funding Guarantor
Warrant Shares unless or until the person or persons requesting the issuance
thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been paid.
(d) Funding Guarantor's Compliance. Nothing in this Section 9 shall
affect in any way the Funding Guarantor's obligations under any agreement to
comply with all applicable securities laws upon resale of the Common Stock.
Section 10. Notices. All notices, demands, requests, consents, approvals,
and other communications required or permitted hereunder shall be in writing and
shall be deemed duly
A-8
given (i) upon delivery if hand delivered at the address designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received), (ii) on the fifth business day after deposit into the mail, if
deposited in the mail, registered or certified, return receipt requested,
postage prepaid, addressed to the address designated below, (iii) upon delivery
if delivered by reputable express courier service to the address designated
below, or (iv) upon confirmation of transmission if transmitted by facsimile to
the facsimile number designated below (if delivered on a business day during
normal business hours where such notice is to be received), or the first
business day following such delivery (if delivered other than on a business day
during normal business hours where such notice is to be received). The addresses
and facsimile numbers for such communications shall be:
if to the Company:
Seitel, Inc.
00000 Xxxxx Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxx X, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Chairman
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxxxx Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to the Funding Guarantor:
[______________________
_______________________
_______________________
_______________________]
Attention:
Telephone:
Facsimile:
with a copy (which shall not constitute notice) to:
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[________________________
_________________________
_________________________
_________________________]
Attention:
Telephone:
Facsimile:
if to the Funding Guarantor Agent:
American Stock Transfer & Trust Company
00 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Attention: Office of the General Counsel
or such successor warrant agent as the Company may appoint and notify the Holder
of as such notice is provided for in this Section 10.
Either party hereto may from time to time change its address or facsimile number
for notices under this section 10 by giving at least ten (10) days' prior
written notice of such changed address or facsimile number to the other party
hereto.
Section 11. Governing Law. This Funding Guarantor Warrant shall be deemed
to be a contract made under the laws of the state of New York and for all
purposes shall be construed in accordance with the internal laws of said state
without regard to principals of conflicts of law.
Section 12. Miscellaneous. This Funding Guarantor Warrant and any term
hereof may be changed, waived, discharged or terminated only by an instrument in
writing signed by the party against which enforcement of such change, waiver,
discharge or termination is sought. The headings in this Funding Guarantor
Warrant are for purposes of reference only, and shall not limit or otherwise
affect any of the terms hereof. The invalidity or unenforceability of any
provision hereof shall in no way affect the validity or enforceability of any
other provision.
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IN WITNESS WHEREOF, this Funding Guarantor Warrant was duly executed
by the undersigned, thereunto duly authorized, as of the date first set forth
above.
SEITEL, INC.
By ___________________________
Name:
Title:
Attested:
By: ____________________________
Name:
Title: Secretary
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EXHIBIT A TO THE FUNDING GUARANTOR WARRANT
EXERCISE FORM
Seitel, Inc.
The undersigned (the "Registered Holder") hereby irrevocably exercises the
right to purchase __________________ shares of Common Stock of Seitel, Inc., an
entity organized and existing under the laws of the State of Delaware (the
"Company"), evidenced by the attached Funding Guarantor Warrant, and herewith
makes payment of the Aggregate Exercise Price with respect to such shares in
full in the form of (check the appropriate box) (i) R cash or official bank
certified check in the amount of $________; or (ii) R wire transfer to the
Company's account at __________________, _________, _________ (Account
No.:_________).
The undersigned requests that stock certificates for such Funding Guarantor
Warrant Shares be issued, and a Funding Guarantor Warrant representing any
unexercised portion hereof be issued, pursuant to this Funding Guarantor Warrant
in the name of the Registered Holder and delivered to the undersigned at the
address set forth below.
Dated: ___________________________________
__________________________________________
Signature of Registered Holder
__________________________________________
Name of Registered Holder (Print)
__________________________________________
Address
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NOTICE
The signature on the foregoing Exercise Form must correspond to the name as
written upon the face of the attached Funding Guarantor Warrant in every
particular, without alteration or enlargement or any change whatsoever, and must
be guaranteed in the manner provided in Section 17Ad of the Securities and
Exchange Act of 1934, as amended.
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EXHIBIT B TO THE FUNDING GUARANTOR WARRANT
ASSIGNMENT
(To be executed by the registered Holder (the "Registered Holder") desiring
to transfer the Funding Guarantor Warrant, in whole or in part.)
FOR VALUED RECEIVED, the undersigned Holder of the attached Funding
Guarantor Warrant hereby sells, assigns or transfers unto the person(s) named
below (the "Assignee") the right to purchase ______________ shares of the Common
Stock of Seitel, Inc. evidenced by the attached Funding Guarantor Warrant and
does hereby irrevocably constitute and appoint ______________________ (attorney)
to transfer the number of shares specified of the said Funding Guarantor Warrant
on the books of the Company, with full power of substitution in the premises.
The undersigned requests that such Funding Guarantor Warrant be issued, and
an Funding Guarantor Warrant representing any unsold, unassigned or
non-transferred portion hereof be issued, pursuant to this Funding Guarantor
Warrant in the name of the Registered Holder and delivered to the undersigned at
the address set forth below.
Dated: _________________________________________
________________________________________________
Signature of Registered Holder
________________________________________________
Name of Registered Holder (Print)
________________________________________________
Address of Registered Holder
________________________________________________
Name of Assignee (Print)
________________________________________________
Address of Assignee (including zip code number)
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Fill in for new Registration of Funding Guarantor Warrant:
___________________________________________
Name
___________________________________________
Address
___________________________________________
Please print name and address of assignee
(including zip code number)
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NOTICE
The signature on the foregoing Assignment must correspond to the name as
written upon the face of the attached Funding Guarantor Warrant in every
particular, without alteration or enlargement or any change whatsoever.
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