HOUSTON, March 16 /PRNewswire-FirstCall/ -- Seitel, Inc. (BULLETIN BOARD: SELA) , a leading provider of seismic data to the oil and gas industry, today announced its offer to purchase up to $8,513,000 principal amount of its 11.75-percent Senior Notes due 2011 ("Notes"). The offer expires at 5:00 p.m. Eastern Time, April 17, 2006. The cash payment required to complete the tender is $1,031.01, which includes accrued and unpaid interest, for each $1,000 of Notes validly tendered and not withdrawn. Payment for any Notes that are accepted for purchase is expected to occur on April 20, 2006.
The company is required by the terms of its indenture for the Notes to make this offer because the company generated excess cash flow (as defined in the indenture) for the year ended 2005 of approximately $17,552,000. The terms of the indenture require an offer to purchase Notes with an amount equal to 50 percent of the excess cash flow, at a purchase price equal to 100 percent of the principal amount of the Notes, plus accrued and unpaid interest. The aggregate purchase price (including principal and interest) will not exceed $8,777,000. If Notes are not tendered for the entire amount of the offer, the remaining 50 percent of the excess cash flow (not to exceed $8,777,000) will be available for any use not otherwise prohibited by the indenture.
This announcement is not an offer to purchase, a solicitation of an offer to purchase, or a solicitation of an offer to sell any Notes.
About Seitel
Seitel, founded in 1982, has grown to become the owner of one of the largest seismic data libraries providing information to the North American oil and gas market. Focused on the U.S. and Canada, the company owns data in all the major exploration and production basins. Seitel continues to grow the data library using its 20 years of experience in performing seismic surveys in North America. Seitel's strengths include expertise in managing and delivering seismic data, as well as an experienced and dynamic sales and marketing team. Seitel's seismic data library includes both onshore and offshore three-dimensional (3D) and two-dimensional (2D) data and offshore multi-component data. The company has ownership in over 35,000 square miles of 3D and approximately 1.1 million linear miles of 2D seismic.
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. Other important factors which could cause actual results to differ materially from those in the forward-looking statements are detailed 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.
(Table to follow)
The following is a reconciliation of the excess cash flow (a non-GAAP financial measure) to the most directly comparable GAAP financial measure, income from operations (in thousands):
Year Ended
December 31, 2005
Excess cash flow $17,552
Add (subtract) items not in operating income:
Principal payments on term loans and
capital lease obligations 6,758
Capital expenditures paid 49,717
Net working capital decrease(A) (8,969)
Interest expense paid 23,926
Income taxes paid 17
Add (subtract) items not in excess cash flow:
Acquisition underwriting from non-monetary exchanges 2,424
Non-monetary exchanges 9,383
Revenue deferred (46,889)
Recognition of revenue previously deferred 60,164
Depreciation and amortization (98,373)
Income from operations, as reported $15,710
(A) Excludes cash and equivalents and current maturities of debt.
Contact: Robert Monson, President and CEO
713-881-2816
William Restrepo, Chief Financial Officer
713-881-8900
