EXHIBIT 10.56
NOTEHOLDER CONSENT
This NOTEHOLDER CONSENT (this "Consent"), dated as of July 15, 2002, is
among SEITEL, INC. (the "Company"), a Delaware corporation, and each of the
investors listed on the signature pages hereto (together with successors and
assigns of each, a "Noteholder," and collectively, the "Noteholders").
Capitalized terms have the respective meanings ascribed thereto in Section 1
hereof.
W I T N E S S E T H:
WHEREAS, each of the 1995 Noteholders and the Company are party to those
certain separate Note Purchase Agreements dated as of December 28, 1995
(collectively, as amended, the "1995 Note Purchase Agreement"), providing for
the sale by the Company and the purchase by the 1995 Noteholders of the
Company's Series B Notes and Series C Notes; and each of the 1999 Noteholders
and the Company are party to those certain separate Note Purchase Agreements
dated as of February 12, 1999 (collectively, as amended, the "1999 Note Purchase
Agreement"), providing for the sale by the Company and the purchase by the 1999
Noteholders of the Company's Series D Notes, Series E Notes and Series F Notes;
and each of the 2001 Noteholders and the Company are party to those certain
separate Note Purchase Agreements dated as of October 15, 2001 (collectively,
the "2001 Note Purchase Agreement"), providing for the sale by the Company and
the purchase by the 2001 Noteholders of the Company's Series G Notes, Series H
Notes and Series I Notes;
WHEREAS, the 1995 Note Purchase Agreement, the 1999 Note Purchase Agreement
and the 2001 Note Purchase Agreement are collectively referred to herein as the
"Note Purchase Agreements;" and
WHEREAS, the Series B Notes, the Series C Notes, the Series D Notes, the
Series E Notes, the Series F Notes, the Series G Notes, the Series H Notes and
the Series I Notes are collectively referred to herein as the "Notes;" and
WHEREAS, on the date hereof, the Company's records indicate that each
Noteholder is the registered owner, in its own or its nominee's name, of one or
more of the Notes; and
WHEREAS, the DDD Energy, Inc., a Restricted Subsidiary, desires to Transfer
certain gas and oil properties and other assets held by it to Rising Star
Energy, L.L.C. (the "Purchaser") pursuant to that Purchase and Sale Agreement,
dated as of July 4, 2002, between DDD Energy, Inc and the Purchaser, a copy of
which is attached hereto as Exhibit A (the "PSA");
WHEREAS, pursuant to the terms of the Note Purchase Agreements and that
Standstill, Forbearance and Amendment Agreement dated as of June 21, 2002 among
the Company and the Noteholders, the consent of the Required Holders under each
of the Note Purchase Agreements is a condition precedent to the proposed
Transfer of assets of DDD Energy, Inc.; and
WHEREAS, the Company has requested that the Noteholders agree and consent
to such Transfer and, subject to the terms and conditions contained herein, the
Noteholders so agree and consent.
NOW, THEREFORE, in consideration of the matters referred to above, the
mutual covenants set forth herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. DEFINITIONS.
The following terms listed below have the meanings set forth below.
Capitalized terms used and not otherwise defined herein shall have the meanings
assigned to them in the Note Purchase Agreements.
"Company" has the meaning assigned to such term in the first paragraph of
this Consent.
"Consent" has the meaning assigned to such term in the first paragraph of
this Consent.
"1995 Note Purchase Agreement" has the meaning assigned to such term in the
first "whereas" clause of this Consent.
"1999 Note Purchase Agreement" has the meaning assigned to such term in the
second "whereas" clause of this Consent.
"Noteholders" has the meaning assigned to such term in the first paragraph
hereof.
"Note Purchase Agreements" has the meaning assigned to such term in the
second "whereas" clause of this Consent.
"Notes" has the meaning assigned to such term in the third "whereas" clause
of this Consent.
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"PSA" - has the meaning assigned to such term in the fifth "whereas" clause
of this Consent.
"Purchaser" - has the meaning assigned to such term in the fifth "whereas"
clause of this Consent.
"Required Noteholders" shall mean the holders of a majority of the
principal amount of the Notes then outstanding issued under each of the 1995
Note Purchase Agreement, the 1999 Note Purchase Agreement and the 2001 Note
Purchase Agreement.
"2001 Note Purchase Agreement" has the meaning assigned to such term in the
third "whereas" clause of this Consent.
2. CONSENT.
Each Noteholder hereby consents, with respect to the Notes held by it, to
the Transfer of (i) the "Acquired Assets" and, (ii) to the extent the Purchase
Option is exercised as provided for in Section 1.03 of the PSA, the "Excluded
Assets" (with all terms used but not defined in this Section II having the
meaning ascribed to such terms in the PSA) to the Purchaser, pursuant to the
terms of the PSA, in accordance with the following conditions:
a. Use of Proceeds.
Up to $9,000,000.00 of the Purchase Price may be used by the Company
in accordance with the Projected Cash Receipts & Disbursements (through
September 27, 2002) dated June 20, 2002, a copy of which is attached hereto
as Exhibit "A" as the same may be amended or updated, consistent, for the
applicable period, with the "Standstill, Forbearance and Amendment
Agreement" dated as of June 21, 2002 and executed on July 9, 2002, as may
be extended and/or amended (the "Standstill Agreement").
b. Interest Payable Upon Closing
An amount equal to the interest obligations due on the Notes (all
series) through the Closing Date under the PSA shall be paid directly to
the Noteholders (or an account or accounts to be designated by the
Noteholders, for further distribution to the Noteholders) out of the
Purchase Price at the Closing.
c. Escrow Remainder
The remainder of the Purchase Price after giving effect to the
provisions of paragraphs "a" and "b" above and, if applicable, the Option
Price, shall be owned by the Company and held in an interest bearing escrow
account ("Escrow") and not disbursed by the escrow agent ("Escrow Agent")
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except upon the earlier of (i) twenty (20) days prior written notice (a
"Notice") to the Noteholders (the "Notice Period") and (ii) the consent of
the Noteholders, as provided below; such Notice to be delivered to the
Noteholders by written notice given to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP, special
counsel to the Noteholders, and Crossroads LLC, the Noteholders' Financial
Advisors. In each such Notice, the Company shall provide the intended uses
and respective amounts of the proposed expenditures out of the Escrow and
shall state that such expenditure is consistent with the Standstill
Agreement. The Noteholders shall have five (5) business days to provide
written consent with respect to the proposed expenditures; in the event the
Noteholders do not timely consent to any disbursement as requested, the
Escrow Agent shall refrain from disbursing the objected-to amount until the
expiration of the Notice Period.
(1) To the extent the Noteholders have procured a
binding order of a court of competent jurisdiction prior to
the expiration of the Notice Period prohibiting the
disbursement, the Escrow Agent and the Company shall be
prohibited from making such disbursement pending disposition
by written agreement with the Noteholders or court order.
(2) To the extent the Noteholders have not procured
such a binding order, then, upon expiration of the Notice
Period, the Escrow Agent and the Company shall be authorized
to make the disbursement provided for in that Notice, provided
however, that as a condition to such authorization and
disbursement, the Company shall pay to the Noteholders (or an
account or accounts to be designated by the Noteholders, for
further distribution to the Noteholders) no later than
coterminously with the disbursement, the amount of interest
due on the Notes (all series) through and including the
proposed disbursement date.
d. Two Month Interest Cycle
Notwithstanding the terms of the Note Purchase Agreements and
the Notes, from and after the Closing Date, ratable interest on the Notes
shall be paid every two (2) months on a common date commencing on the first
business day of the third full month following the Closing on the PSA
(e.g., if Closing is July 31, the first two month payment will be October 1
for the period through and including September 30), and continuing on the
first business day of every second month thereafter through the conclusion
of the respective terms of the Notes as provided in the Note Purchase
Agreement.
e. Calculation of Covenant Compliance
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In respect of the calculation for covenant compliance under
the Note Purchase Agreements and the Notes, the Acquired Assets and
Excluded Assets and the liabilities attributed to them shall be excluded in
the calculation of covenant compliance.
f. Consent to be Delivered to Purchaser
The Noteholders specifically authorize the Company to deliver,
in the Company's discretion, a copy of this Consent to the Purchaser.
3. EXPENSES AND FEES.
The Company agrees to pay all reasonable fees and expenses of the
Noteholders, including, without limitation, those of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ LLP,
special counsel to the Noteholders, and Crossroads, LLC, the Noteholders'
Financial Advisor, incurred in connection with this Consent and the truncations
related thereto.
4. REPRESENTATIONS OF THE COMPANY.
The Company hereby represents and warrants to the Noteholders that the
Purchaser is not an Affiliate of the Company, and that there are no other
material agreements or arrangements between the Company and/or the Subsidiaries
on the one hand and the Purchaser on the other with respect to the sale of the
DDD Energy, Inc. assets.
5. HEADINGS.
All headings and captions preceding the text of the several Sections of
this Consent are intended solely for the convenience of reference and shall not
constitute a part of this Consent nor shall they affect its meaning,
construction or effect.
6. COUNTERPARTS.
This Consent may be executed by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement. An
executed copy of this Consent sent by facsimile shall be effective as an
original.
[Remainder page intentionally left blank. Next page is signature page.]
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IN WITNESS WHEREOF, each party hereto has caused this Consent to be
executed by its authorized officers as of the date first written above.
PRINCIPAL LIFE INSURANCE
COMPANY
By: Principal Capital
Management, LLC, a
Delaware limited liability
company, its authorized signatory
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ Epp
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
Title: Counsel
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Counsel
PRINCIPAL LIFE INSURANCE
COMPANY, ON BEHALF OF ONE
OR MORE SEPARATE ACCOUNTS
By: Principal Capital
Management, LLC, a
Delaware limited liability
company, its authorized signatory
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ Epp
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
Title: Counsel
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Counsel
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CGU LIFE INSURANCE COMPANY OF AMERICA, a
Delaware corporation (formerly
known as Commercial
Union Life Insurance Company of America)
By: Principal Capital Management, LLC,
a Delaware limited liability company,
its attorney in fact
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ Epp
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
Title: Counsel
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇ ▇. ▇▇▇▇▇
Title: Counsel
ALLSTATE LIFE INSURANCE COMPANY
By /s/ ▇.▇. ▇▇▇▇▇▇▇
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Name: ▇.▇. ▇▇▇▇▇▇▇
Title: Authorized Signatory
By /s/ ▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇ ▇▇▇▇▇▇
Title: Authorized Signatory
ALLSTATE LIFE INSURANCE COMPANY OF NEW
YORK
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By /s/ ▇.▇. ▇▇▇▇▇▇▇
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Name: ▇.▇. ▇▇▇▇▇▇▇
Title: Authorized Signatory
By /s/ ▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇ ▇▇▇▇▇▇
Title: Authorized Signatory
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ & Company Inc.
as Investment Adviser
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
C.M. LIFE INSURANCE COMPANY
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and Company Inc.
as Investment Sub-Adviser
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
MASSMUTUAL ASIA LIMITED
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ & Company Inc.
as Investment Adviser
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
THE GUARDIAN INSURANCE & ANNUITY COMPANY,
INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: Managing Director
FORT DEARBORN LIFE INSURANCE COMPANY
By: Guardian Investor Services LLC
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director
THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director
BERKSHIRE LIFE INSURANCE COMPANY OF AMERICA
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director
J. ROMEO & CO. AS NOMINEE FOR
MONY LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Authorized Signatory
J. ROMEO & CO. AS NOMINEE FOR
MONY LIFE INSURANCE COMPANY OF AMERICA
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: Authorized Signatory
PHOENIX LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President, Corporate
Portfolio Management
UNITED OF OMAHA LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
Title: First Vice President
RELIASTAR LIFE INSURANCE COMPANY
By: ING Investment Management,
LLC, as Agent
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
NORTHERN LIFE INSURANCE COMPANY
By: ING Investment Management, LLC,
as Agent
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK
By: ING Investment Management LLC, as Agent
-6-
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
SECURITY CONNECTICUT LIFE
INSURANCE COMPANY
By: ING Investment
Management LLC, as Agent
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President
Accepted and Agreed:
SEITEL, INC.
By /s/ ▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇
Title: President and Chief Executive Officer
SEITEL DATA CORP.
By /s/ ▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇
Title: President and Chief Executive Officer
SEITEL DATA, LTD.
By: Seitel Delaware, Inc., general partner
By /s/ ▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇
Title: President and Chief Executive Officer
N360X, L.L.C.
By: Seitel Management, Inc.,
managing member
By /s/ ▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇
Title: President and Chief Executive Officer
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SEITEL MANAGEMENT, INC.
By /s/ ▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇
Title: President and Chief Executive Officer
SEITEL GEOPHYSICAL, INC.
DDD ENERGY, INC.
SEITEL GAS & ENERGY CORP.
SEITEL POWER CORP.
SEITEL NATURAL GAS, INC.
MATRIX GEOPHYSICAL, INC.
EXSOL, INC.
DATATEL, INC.
SEITEL OFFSHORE CORP.
SEITEL INTERNATIONAL, INC.
AFRICAN GEOPHYSICAL, INC.
GEO-BANK, INC.
ALTERNATIVE COMMUNICATION
ENTERPRISES, INC.
SEITEL DELAWARE, INC.
By /s/ ▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇
Title: President and Chief Executive Officer
