As filed with the U.S. Securities and Exchange Commission on August 30, 2016
December 10, 2018Registration No. 333-
__________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORMS-3
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SAEXPLORATION HOLDINGS, INC.
(Exact name of registrantRegistrant as specified in its charter)
it charter |
| | | |
Delaware
( | | 1311 | | 27-4867100 |
State or other jurisdiction of
incorporation or organization)organization | | 27-4867100
(I.R.S. Employer
Identification Number)Primary Standard Industrial Classification Code Number |
| | 1160 Dairy Ashford Road, Suite 160
Houston, Texas 77079
(281) 258-4400 | |
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)I.R.S. Employer Identification No. |
1160 Dairy Ashford Road, Suite 160
Houston, Texas 77079
(281)258-4400
(Address, including zip code, and telephone number, including area code, of each registrant’s principal executive offices)
Brent Whiteley, Esq.
Chief Financial Officer, General Counsel and Secretary
1160 Dairy Ashford Road, Suite 160
Houston, Texas 77079
(281)258-4400
(Name, address, including zip code, and telephone number, including area code, of agent for service)
With a copyCopy to:
Carol Glendenning, Esq.
Strasburger
Christopher Centrich
Akin Gump Strauss Hauer & Price,Feld LLP
901 Main
1111 Louisiana Street, Suite 440044th Floor
Houston, TX 77002
(713)220-5800
Dallas, Texas 75202
(214) 651-4300
Approximate date of commencement of proposed sale to the public: public: From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box.
o
box: ☐If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box.
x
box: ☒If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
o
☐If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
o
☐If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box.
o
☐If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box.
o
☐Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”filer,” “smaller reporting company,” and “smaller reporting“emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
|
| | | | | |
| Large accelerated filer | o | ☐ | | Accelerated filer | o | ☐ |
| Non-accelerated filer | o | (Do not check if a smaller reporting company)☐ | | Smaller reporting company | x | ☒ |
| | | | Emerging growth company | | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
CALCULATION OF REGISTRATION FEE
|
| | | | |
Title of each class
of securities to be registered | Amount to be registered |
Proposed
maximum offering price per unit (2) |
Proposed maximum
aggregate offering price | Amount of
registration fee |
| Shares of Common Stock, $0.0001 par value | 3,083,359 (1) | $12.29 | $37,894,482.11 | $3,815.97 |
| Total | 3,083,359 | | | $3,815.97 |
| | | | | | | | |
|
Title of Each Class of Securities to be Registered | | Amount to be
Registered | | Proposed Maximum Offering Price Per Share (1)(2) | | Proposed Maximum
Aggregate Offering Price (1)(2) | | Amount of
Registration Fee(2) |
Common Stock, par value $0.0001 per share | | 794,182 (1) | | $3.41 | | $2,708,160.62 | | $328.23 |
Common Stock, par value $0.0001 per share, issuable upon the exercise of 6.00% Senior Secured Convertible Notes due 2023 | | 14,625,000 (3) | | $3.41 | | $49,871,250.00 | | $6,044.40 |
Common Stock, par value $0.0001 per share, issuable upon the exercise of warrants | | 4,197,649 (2) | | $3.41 | | $14,313,983.09 | | $1,734.85 |
|
|
| |
| (1) | Pursuant to Rule 416 ofunder the Securities Act of 1933, as amended (the “Securities Act”), includes an undetermined number of additional shares of Common Stock as may from time to time be issued by reason of stock splits, stock dividends, and other similar transactions. |
| (2) | Estimated in accordance with Rule 457(c) solely for purposes of calculating the registration fee. The maximum price per security and the maximum aggregate offering price are based on the average of the $3.51 (high) and $3.30 (low) sale prices of the registrant’s Common Stock as reported on the Nasdaq Capital Market on December 10, 2018, which date is within five business days prior to filing this Registration Statement. |
| (3) | Represents the maximum number of shares of Common Stock that may be issued upon exercise of the 6.00% Senior Secured Convertible Notes due 2023 (including the shares issuable upon a Make-Whole Fundamental Change (as defined in the Indenture)) and warrants to be registered hereunder. Pursuant to Rule 416 under the Securities Act, such number of common stock offeredshares or underlying Common Stock registered hereby alsoshall include such presentlyan indeterminate number of shares of Common Stock that may be issued in connection with the Registrant’s common stock as a result ofanti-dilution provisions or stock splits, stock dividends, recapitalizations or similar transactions.events. |
| |
(2) | Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) of the Securities Act, based upon the average high and low sales prices of the Registrant’s common stock on The Nasdaq Global Market on August 29, 2016. |
The Registrantregistrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrantregistrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
The information contained in this preliminary prospectus is not complete and may be changed. The selling stockholders may not sell these securities until the registration statementRegistration Statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell thesethe securities and it is not solicitinga solicitation of an offer to buy these securities in any statejurisdiction where an offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED AUGUST 30, 2016
Subject to Completion, dated December 10, 2018
PROSPECTUS
SAExploration Holdings, Inc.
3,083,359
SAEXPLORATION HOLDINGS, INC.
794,182 Shares of Common Stock Offered by Selling Stockholders
14,625,000 Shares of Common Stock Issuable Upon Conversion of
6.00% Senior Secured Convertible Notes due 2023
4,197,649 Shares of Common Stock Issuable Upon Exercise of the Warrants
This prospectus relates to an aggregateoffer and sale of (i) up to 3,083,359794,182 shares of our common stock, par value $0.0001 per share (the “Common Stock”), of SAExploration Holdings, Inc. (the “Company”), (ii) up to 14,625,000 shares of Common Stock that may be offered for sale from timeissued upon conversion of the Convertible Notes (as defined herein), and (iii) up to time4,197,649 shares of Common Stock that may be issued upon exercise of the Existing Warrants (as defined herein), in each case, by the selling stockholders identified in this prospectus or in supplements to this prospectus.
Our common stock is listed on The Nasdaq Global Market under the symbol “SAEX.” On August 29, 2016, the closing price of our common stock on The Nasdaq Global Market was $12.08 per share.
The selling stockholders may sell all or a portion of theoffer shares of our common stock beneficially owned by them and offered herebyCommon Stock from time to time directly or through one or more underwriters, broker-dealers, or agents. The sales may be conducted in the open market or in privately negotiated transactionsa number of different ways and at prevailing market prices, fixed prices, or negotiatedvarying prices. TheFor more information on possible methods of offer and sale by the selling stockholders, you should refer to the section of this prospectus entitled “Plan of Distribution.” We will bear all discounts, concessions, commissions, and similar expenses, ifnot receive any attributable toproceeds from the sale of shares.any shares covered by this prospectus. We will bear the otherall costs, expenses, and fees in connection with the registration of the shares.
We The selling stockholders will
not receivebear all commissions and discounts, if any,
of the proceeds fromattributable to the sale of
sharesshares.Our Common Stock is listed on the Nasdaq Capital Market (“Nasdaq”) under the symbol “SAEX.” On December 10, 2018, the last reported sale price of our common stock byCommon Stock on the selling stockholders. We will not control or determineNasdaq was $3.33.
Investing in our Common Stock involves risk. You should carefully read the price at whichinformation under the selling stockholders sell their shares, and we do not know at which times or in what amounts the selling stockholders may offer the shares for sale.
INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS" ON PAGE 4.
heading “Risk Factors” beginning on page 7 of this prospectus.Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacydetermined if this prospectus is truthful or accuracy of this prospectus.complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is _______________, 2016, 2018.
TABLE OF CONTENTS
You should rely only on the information contained or incorporated by reference in this prospectus and any prospectus supplement. We have not authorized anyone to provide you with additional or different information. If anyone provides you with different or inconsistent information, you should not rely on it. This prospectus and any prospectus supplement are not an offer to sell or a solicitation of an offer to buy any securities other than the securities to which they relate and are not an offer to sell or a solicitation of an offer to buy securities in any jurisdiction to any person to whom it is unlawful to make an offer or solicitation in that jurisdiction. You should assume that the information appearing in this prospectus and any prospectus supplement, as well as the information contained in any document incorporated by reference herein or therein, is accurate as of the date of such document only. Our business, financial condition, results of operations, and prospects may have changed since that date.
i
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains “forward-looking statements” within the meaning of the U.S. federal securities laws, with respect to our financial condition, results of operations, cash flows and business, and our expectations or beliefs concerning future events. These forward-looking statements can generally be identified by phrases such as “expects,” “anticipates,” “believes,” “estimates,” “intends,” “plans to,” “ought,” “could,” “will,” “should,” “likely,” “appears,” “projects,” “forecasts,” “outlook” or other similar words or phrases. There are inherent risks and uncertainties in any forward-looking statements. Although we believe that our expectations are reasonable, we can give no assurance that these expectations will prove to have been correct, and actual results may vary materially. Except as required by law, we undertake no obligation to update, amend or clarify any forward-looking statements to reflect events, new information or otherwise. Some of the important factors that could cause actual results to differ materially from our expectations are discussed below. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements.
Factors that could cause actual results to vary materially from our expectations include the following
developments with respect to the Alaskan oil and natural gas exploration tax credit system that may continue to affect the willingness of third parties to participate in financing and monetization transactions and our ability to timely monetize tax credits that have been assigned to us by our customer;
changes in the Alaskan oil and natural gas exploration tax credit system that may significantly affect the level of Alaskan exploration spending;
fluctuations in the levels of exploration and development activity in the oil and natural gas industry;·
intense industry competition;
limited number of customers;
credit and delayed payment risks related to our customers;
the availability of liquidity and capital resources, including our need to obtain additional working capital and refinance or replace our credit facility and our senior term facility, limited ability to make capital expenditures due to our current liquidity and cash flow situation, and the potential impact this has on our business and competitiveness;
need to manage rapid growth and contraction of our business;
delays, reductions or cancellations of service contracts;
operational disruptions due to seasonality, weather and other external factors;
crew availability and productivity;
whether we enter into turnkey or term contracts;
high fixed costs of operations;
substantial international business exposing us to currency fluctuations and global factors, including economic, political, and military uncertainties;
ability to retain key executives; and
need to comply with diverse and complex laws and regulations.
You should refer to our periodic and current reports filed with the SEC and the risk factors from our Annual Report on Form10-K for the year ended December 31, 2017 and our Quarterly Reports on Form10-Q for the quarters ended March 31, 2018 and June 30, 2018 for specific risks which would cause actual results to be significantly different from those expressed or implied by any of our forward-looking statements. It is not possible to identify all of the risks, uncertainties and other factors that may affect future results. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this prospectus may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. Accordingly, readers of this prospectus are cautioned not to place undue reliance on the forward-looking statements.
This prospectus is a part of the registration statement on FormS-3 that we filed with the Securities and Exchange Commission (the “SEC”). You should read this prospectus together with the more detailed information regarding our company, our common stock,Common Stock, and our financial statements and the notes to those statements that appear elsewhere in this prospectus and any applicable prospectus supplement together with the additional information that we incorporate in this prospectus by reference, which we describe under the headings “Information Incorporated by Reference” andheading “Where You Can Find More Information.”
You should rely only on the information contained in, or incorporated by reference in, this prospectus and in any accompanying prospectus supplement. We have not authorized anyone to provide you with information different from that contained in, or incorporated by reference in, this prospectus. You should not assume that the information in this prospectus or any prospectus supplement is accurate as of any date other than the date on the front of those documents or that any document incorporated by reference is accurate as of any date other than its filing date. You should not consider this prospectus or any prospectus supplement to be an offer or solicitation relating to the securities in any jurisdiction in which such an offer or solicitation relating to the securities is not authorized. Furthermore, you should not consider this prospectus or any prospectus supplement to be an offer or solicitation relating to the securities if the person making the offer or solicitation is not qualified to do so, or if it is unlawful for you to receive such an offer or solicitation.
Unless the context requires otherwise, in this prospectus, the terms “our company,” “we,” “us,” “our,” and similar references refer to SAExploration Holdings, Inc., formerly named Trio Merger Corp., and its subsidiaries.
PROSPECTUS SUMMARY
WHERE YOU CAN FIND MORE INFORMATIONWe file annual, quarterly and current reports, proxy statements and other information with the SEC. We also filed a registration statement on FormS-3, including exhibits, under the Securities Act with respect to the shares covered by this prospectus. This prospectus is a part of the registration statement, but does not contain all of the information included in the registration statement or the exhibits. You may read and copy the registration statement and any other document that we file at the SEC’s public reference room at 100 F Street, N.E., Washington D.C. 20549. You can call the SEC at1-800-SEC-0330 for further information on the operation of the public reference room. You can also find our public filings with the SEC on the internet at a web site maintained by the SEC located at http://www.sec.gov. We also make available on our internet website our annual, quarterly and current reports and amendments as soon as reasonably practicable after such documents are electronically filed with, or furnished to, the SEC. Our Internet address is www.saexploration.com. The SEC allows us to “incorporateinformation on our website is not incorporated by reference into this prospectus and does not constitute a part of this prospectus.
We are “incorporating by reference” certain informationspecified documents that we file with it,the SEC, which means that means:
incorporated documents are considered part of this prospectus;
we can discloseare disclosing important information to you by referring you to those documents. The documents; and
information incorporated by reference is considered to be part of this prospectus, and information that we file later with the SEC will automatically update supplement, and/and supersede information contained in this prospectus.
We incorporate by reference the documents listed below (excluding any information furnished and not filed with the SEC), which we filed with the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”):
Our Annual Report on Form10-K for the year ended December 31, 2017, filed on March 16, 2018;
Our Quarterly Report on Form10-Q for the quarterly period ended March 31, 2018, filed on May 15, 2018;
Our Quarterly Report on Form10-Q for the quarterly period ended June 30, 2018, filed on August 9, 2018;
Our Quarterly Report on Form10-Q for the quarterly period ended September 30, 2018, filed on November 13, 2018;
Our Current Reports on Form8-K filed on January 18, 2018, January 30, 2018, February 1, 2018, March 2, 2018, March 8, 2018, March 29, 2018, April 13, 2018, June 13, 2018, July 2, 2018, July 11, 2018, July 30, 2018, August 14, 2018, September 11, 2018, September 19, 2018, October 2, 2018, October 5, 2018, October 19, 2018 and November 29, 2018; and
The description of our Common Stock contained in our Form8-A filed December 9, 2011, including any amendment to that form that we may file in the future for the purpose of updating the description of our Common Stock.
In addition, we incorporate by reference in this prospectus any future filings we make with the SEC under Sections 13(a), 13(c), 14, or supersede15(d) of the Exchange Act (excluding any information furnished and not filed with the SEC) after the date on which the registration statement that includes this information. prospectus was initially filed with the SEC (including all such documents we may file with the SEC after the date of the initial registration statement and prior to the effectiveness of the registration statement) and until all offerings under this shelf registration statement are terminated.
Any statement contained in a document incorporated or deemed to be incorporated by reference in this prospectusherein shall be deemed to be modified or superseded for all purposes of this prospectus to the extent that a statement contained in this prospectus or in any other
subsequently filed document which is also isincorporated or is deemed to be incorporated by reference, in this prospectus modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus. You should readmay request a copy of these filings (other than an exhibit to a filing unless that exhibit is specifically incorporated by reference into that filing) at no cost by writing or telephoning us at the following summary together withaddress and telephone number:
SAExploration Holdings, Inc.
1160 Dairy Ashford Rd., Suite 160
Houston, Texas 77079
Attention: Investor Relations
Telephone: (281)258-4409
Email: rabney@saexploration.com
THE COMPANY
SAExploration Holdings, Inc. and its subsidiaries (collectively, the more detailed information regarding our company, our common stock and our financial statements and the notes to those statements appearing elsewhere in this prospectus“Company,” “we,” “us,” or incorporated herein by reference.
Our Company
We are“our”) is an internationally-focused oilfield services company offering a full range of vertically-integrated seismic data acquisition and logistical support services in Alaska, Canada, South America, West Africa and Southeast Asia to our customers in the oil and natural gas industry. In addition to the acquisition of 2D, 3D, time-lapse 4D and multi-component seismic data on land, in transition zones between land and water, and offshore in depths reaching 3,000 meters, we offer a full-suite of logistical support andin-field data processing services. We operate crews around the world that utilizeare supported by over 29,500140,000 owned land and marine channels of seismic data acquisition equipment and other leased equipment as needed to complete particular projects. Seismic data is used by our customers, including major integrated oil companies, national oil companies and large international independent oil and gas exploration and production companies, to identify and analyze drilling prospects and maximize successful drilling. The results of the seismic surveys we conduct belong to our customers and are proprietary in nature; we do not acquire data for our own account or for future sale or maintain multi-client data libraries.
Contact Information
Our principal headquarters are located in Houston, Texas at 1160 Dairy Ashford Road,Rd., Suite 160, Houston, Texas, 77079, Telephone: (281)258-4400, and our web address is
www.saexploration.com. Informationwww.saexploration.com. We do not intend for information contained onin our website is notto be a part of this prospectus and is not incorporatedprospectus.RISK FACTORS
An investment in this prospectus by reference.
Company History and Merger
We were incorporated in Delaware on February 2, 2011, under the name Trio Merger Corp. as a blank check company in order to serve as a vehicle for the acquisition of a target business. On June 24, 2013, we completed a business combination in which the entity formerly known as SAExploration Holdings, Inc. (“Former SAE”) merged with and into our wholly-owned subsidiary Trio Merger Sub, Inc., now named SAExploration Sub, Inc. (“Merger Sub”), with Merger Sub surviving (the “Merger”). Upon the Merger, we succeeded to the business operations of Former SAE.
Restructuring and Reverse Stock Split
On June 13, 2016, we entered into a comprehensive restructuring support agreement (the “Restructuring Support Agreement”) with holders (the “Supporting Holders”) of approximately 66% of the par value of our 10.000% senior secured notes due 2019 (the “Existing Notes” and the holders thereof, the “Existing Holders”), in which we and the Supporting Holders agreed to enter into and implement a proposed comprehensive restructuring of our balance sheet, which included a new senior secured loan facility providing for the funding of up to $30 million in capital (the “Restructuring”).
On June 24, 2016, we commenced an offer to exchange (the “Exchange Offer”) each $1 of Existing Notes held by the Existing Holders for (i) $0.50 of newly issued 10% Senior Secured Second Lien Notes due 2019 (the
“New Second Lien Notes”), and (ii) 0.04641 shares of our newly issued common stock (after giving effect to a 135-for-1 reverse stock split that was effectedCommon Stock involves risks. In evaluating an investment in connection with closing of the Exchange Offer, the “Reverse Stock Split”). The Exchange Offer expired on July 22, 2016, and closed on July 27, 2016 (the “Closing Date”). On the Closing Date, a total of $138,128,000 of the face value of the Existing Notes were exchanged for $76,523,000 New Second Lien Notes, including $7,459,000 in New Second Lien Notes representing accrued and unpaid interest on the Existing Notes, and 6,410,502 shares of our common stock (the “New Notes Shares”).
On June 29, 2016, weCommon Stock, you should consider carefully the risk factors and the Supporting Holders entered into a $30 million multi-draw senior secured term loan facility (the "Senior Loan Facility"). All holders of Existing Notes that participated in the Exchange Offer were also able to participate in the Senior Loan Facility. As part of the consideration for providing the Senior Loan Facility, we issued to the lenders under the Senior Loan Facility shares equal to 28.2% of the outstanding shares of our common stock as of the Closing Date, or 2,803,302 shares, after giving effect to the Reverse Stock Split (the “New Senior Lender Shares”).
On August 1, 2016, we had 9,334,288 shares of our common stock outstanding, and, of that number, 9,213,804 shares were issued to tendering holders of Existing Notes and to the lenders under the Senior Loan Facility (collectively, the “New Holders”). The New Holders received registration rights. New Holders of 3,058,944shares have exercised their rights to register their shares to sell under this prospectus or a supplement hereto.
Piggy-Back Registration Rights
Certain of our other existing stockholders have exercised their “piggy-back” registration rights to register an aggregate of 24,221 shares of our common stock for sale under this prospectus or a supplement hereto.
Resale Offering:
|
| |
Securities offered: | 3,083,359 shares of our common stock, par value $0.0001 per share (the “Registered Shares”), which may be offered for sale from time to time by the selling stockholders identified in this prospectus.
The Registered Shares consist of:
• 255,642 New Notes Shares issued in connection with the Exchange Offer;
• 2,803,302 New Senior Lender Shares issued to lenders as consideration for providing our Senior Loan Facility;
• 24,221 shares as to which “piggy-back” registration rights have been exercised; and
• 194 shares that are unallocated as of the date of this prospectus.
|
Selling stockholders: | Twenty-oneof our stockholders are listed as selling stockholders. See “Selling Stockholders” beginning on page 5.
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Number of shares of common stock outstanding before and after this offering: | 9,343,513 |
Manner of offering: | The selling stockholders may sell all or a portion of the shares of our common stock beneficially owned by them and offered hereby from time to time directly or through one or more underwriters, broker-dealers, or agents. The sales may be conducted in the open market or in privately negotiated transactions and at prevailing market prices, fixed prices, or negotiated prices. See “Plan of Distribution” beginning on page 10. |
Use of proceeds: | We will not receive any of the proceeds from the sale of shares of our common stock by the selling stockholders. |
Risk factors: | You should carefully consider all of the information contained in, and incorporated by reference into, this prospectus and, in particular, you should evaluate the specific risks associated with an investment in our securities. See “Risk Factors” beginning on page 4. |
The Nasdaq Global Market symbol for Common Stock: | SAEX |
On July 26, 2016, we effected a one-for-135 reverse stock split for our common stock. Unless otherwise indicated, all share amounts disclosed in this prospectus reflect the post-split number of shares of our common stock. Unless specifically stated otherwise, the information in this prospectus also assumes no exercise of outstanding options or warrants. |
RISK FACTORS
An investment in our common stock involves risk. Prior to making any investment decision, prospective investors should carefully consider the specific factors set forth under the caption “Risk Factors” in our Quarterly Report on Form 10-Q for the period ended June 30, 2016, which was filed with the SEC on August 12, 2016, and in our other periodic reports filed with the SEC that are incorporated by reference herein, together with all of the other information appearingincluded in this prospectus or in the applicable prospectus supplement or incorporated by reference into this prospectus. The risksprospectus and uncertainties described in any prospectus supplement and the documents we incorporateadditional information which may be incorporated by reference into this prospectus are notin the onlyfuture, as provided under “Where You Can Find More Information” on page 4 of this prospectus, including our Annual Report on Form10-K for the fiscal year ended December 31, 2017 and subsequent Annual Reports on Form10-K, Quarterly Reports on Form10-Q and Current Reports on Form8-K, including the risk factors described under “Risk Factors” in such reports. This prospectus also contains forward-looking statements that involve risks and uncertainties we face. Additionaluncertainties. If any of these risks and uncertainties that we are unaware of or that we believe are not material at the time could also materially adversely affectoccur, our business, financial condition or results of operations.operations could be adversely affected. In anythat case, the valuetrading price of shares of our securitiesCommon Stock could decline and you could lose all or part of your investment. See alsoPlease read “Cautionary Note Regarding Forward-Looking Statements” below.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements and information inbeginning on page 1 of this prospectus, any prospectus supplements and documents we incorporate by reference herein constitute “forward-looking statements” within the meaning of the U.S. federal securities laws, with respect to our financial condition, results of operations, cash flows and business, and our expectations or beliefs concerning future events. These forward-looking statements can generally be identified by phrases such as “expects,” “anticipates,” “believes,” “estimates,” “intends,” “plans to,” “ought,” “could,” “will,” “should,” “likely,” “appears,” “projects,” “forecasts,” “outlook” or other similar words or phrases. There are inherent risks and uncertainties in any forward-looking statements. Although we believe that our expectations are reasonable, we can give no assurance that these expectations will prove to have been correct, and actual results may vary materially. Except as required by law, we undertake no obligation to update, amend or clarify any forward-looking statements to reflect events, new information or otherwise. Some of the important factors that could cause actual results to differ materially from our expectations are discussed below. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements.
Factors that could cause actual results to vary materially from our expectations include the following:
developments with respect to the Alaskan oil and natural gas exploration tax credit system that may continue to affect the willingness of third parties to participate in financing and monetization transactions and our ability to timely monetize tax credits that have been assigned to us by our customer;
changes in the Alaskan oil and natural gas exploration tax credit system that may significantly affect the level of Alaskan exploration spending;
fluctuations in the levels of exploration and development activity in the oil and natural gas industry;
intense industry competition;
limited number of customers;
credit and delayed payment risks related to our customers;
the availability of liquidity and capital resources, including our limited ability to make capital expenditures and the potential impact this has on our business and competitiveness;
need to manage rapid growth and contraction of our business;
delays, reductions or cancellations of service contracts;
operational disruptions due to seasonality, weather and other external factors;
crew availability and productivity;
whether we enter into turnkey or term contracts;
high fixed costs of operations;
substantial international business exposing us to currency fluctuations and global factors, including economic, political and military uncertainties;
ability to retain key executives; and
need to comply with diverse and complex laws and regulations.
You should refer to our other periodic and current reports filed with the SEC and the risk factors from our Quarterly Report on Form 10-Q for the period ended June 30, 2016, which was filed with the SEC on August 12, 2016, and in our other periodic reports filed with the SEC that are incorporated by reference herein, for specific risks which would cause actual results to be significantly different from those expressed or implied by any of our forward-looking statements. It is not possible to identify all of the risks, uncertainties, and other factors that may affect future results. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this prospectus and any prospectus supplement may not occur andprospectus. Our actual results could differ materially from those anticipated
or implied in the forward-looking
statements. Accordingly, readersstatements as a result of
this prospectuscertain factors.Risks Relating to Our Common Stock
Future sales of our Common Stock in the public market or the issuance of securities senior to our Common Stock, or the perception that these sales may occur, could adversely affect the trading price of our Common Stock and our ability to raise funds in stock offerings.
Sales by us or our stockholders of a substantial number of shares of our Common Stock in the public markets, or the perception that these sales might occur, could cause the market price of our Common Stock to decline or could impair our ability to raise capital through a future sale of, or pay for acquisitions using, our equity securities. We are cautioned notcurrently authorized to place undue relianceissue 40,000,000 shares of Common Stock and 1,000,000 shares of preferred stock, par value $0.0001 per share, with such designations, rights, preferences, privileges and restrictions as determined by our board of directors. As of December 4, 2018, we had outstanding 3,100,496 shares of Common Stock, and there were 4,389,614 shares of Common Stock issuable upon the exercise of the Series A Warrants, Series B Warrants, Series C Warrants, Series D Warrants and Series E Warrants (each as defined below). Furthermore, on September 26, 2018, we issued $60 million in aggregate principal amount of 6.00% Senior Secured Convertible Notes due 2023 (the “Convertible Notes”), which are initially convertible into a total of 10,434,783 shares of Common Stock (or up to 15,000,000 shares of Common Stock issuable upon a Make-Whole Fundamental Change (as defined in the Indenture)) (or, at the holder’s election, in the form of new series of warrants (the “Conversion Warrants”) to purchase an equal number of shares of Common Stock at an exercise price of $0.0001 per share, subject to customary adjustments (such shares, the “Conversion Warrant Shares”)). There are also 2,750,000 shares of Common Stock reserved for issuance under the Amended and Restated 2018 LTIP, as amended, which includes 1,791,056 shares of Common Stock reserved for issuance in respect of Management Incentive Plan Awards (“MIP Awards”), which is equal to ten percent (10%) of the aggregate number of shares of Common Stock issued and outstanding on a fully diluted basis after giving effect to dilution from full conversion of any of our securities convertibles into shares of Common Stock, including the Convertible Notes (the “MIP Reserve”). Currently, 258,917 shares of Common Stock are subject to unvested MIP Awards. The potential issuance of such additional shares of Common Stock may create downward pressure on the forward-looking statements.trading price of our Common Stock.
We may issue Common Stock or other equity securities senior to our Common Stock in the future for a number of reasons, including to finance our operations and growth plans, to adjust our ratio ofdebt-to-equity, to satisfy our obligations upon the conversion of convertible securities, or for other reasons. We cannot predict the effect, if any, that future sales or issuances of shares of our Common Stock or other equity securities, or the availability of shares of Common Stock or such other equity securities for future sale or issuance, will have on the trading price of our Common Stock.
USE OF PROCEEDS
WeThe selling stockholders will not receive anyall of the proceeds from the sale of sharesCommon Stock offered from time to time pursuant to this prospectus. Accordingly, we will not receive any proceeds from the sale of our common stock by the selling stockholders.
SELLING STOCKHOLDERS
This prospectus covers the offer and saleCommon Stock by the selling stockholders identified below of up to 3,083,359shares of our common stock. These selling stockholders, including their transferees, pledgees or donees or their successors, may from time to time resell shares of our common stock pursuant to this prospectus or any prospectus supplement during the period the registration statement of which this prospectus is a part remains effective. In the event that a sale is to be made pursuant to this prospectus by a pledgee or other transferee, we will provide appropriate information regarding such pledgee or transferee by a prospectus supplement or post-effective amendment, if necessary, naming such pledgee or transferee as a selling stockholder.
Holders of New Notes Shares and New Senior Lender Shares
On June 13, 2016, we entered into a comprehensive restructuring support agreement (the “Restructuring Support Agreement”) with holders (the “Supporting Holders”) of approximately 66% of the par value of our 10.000% senior secured notes due 2019 (the “Existing Notes” and the holders thereof, the “Existing Holders”), in which we and the Supporting Holders agreed to enter into and implement a proposed comprehensive restructuring of our balance sheet, which included a new senior secured loan facility providing for the funding of up to $30 million in capital.
The Restructuring Support Agreement contemplated the following transactions (collectively, the “Restructuring”): (i) the Supporting Holders entry into a Senior Loan Facility (defined below); (ii) the Exchange Offer (defined below); (iii) the amending and restating of the Intercreditor Agreement among our lenders to change the priority of our secured indebtedness; (iv) the issuance of two series of warrants to the existing holders of our stock; (v) entering into new employment agreements with the members of senior management, establishing a new management incentive plan, and issuing equity to the members of management under the terms of our new management incentive plan; and (vi) the amendment of our organizational documents. Pursuant to the Restructuring Support Agreement, the Supporting Holders have the right to designate six of our new seven member board of directors.
On June 24, 2016, we commenced an offer to exchange (the “Exchange Offer”) each $1 of Existing Notes held by the Existing Holders for (i) $0.50 of newly issued 10.000% Senior Secured Second Lien Notes due 2019 (the “New Second Lien Notes”), and (ii) 0.04641 shares of our newly issued common stock (after giving effect to a 135-for-1 reverse stock split that was effected in connection with closing of the Exchange Offer, the “Reverse Stock Split”). The Exchange Offer expired on July 22, 2016, and closed on July 27, 2016 (the “Closing Date”). On the Closing Date, a total of $138,128,000 of the face value of the Existing Notes were exchanged for $76,523,000 New Second Lien Notes, including $7,459,000 in New Second Lien Notes representing accrued and unpaid interest on the Existing Notes, and 6,410,502 shares of our common stock (the “New Notes Shares”). We delivered cash in lieu of any fractional shares. This prospectus includes 255,642 of the New Notes Shares held by affiliates of two of the Supporting Holders, Whitebox Advisors LLC and BlueMountain Capital Management, LLC (each a “Principal Stockholder”).
The New Second Lien Notes will bear interest at a rate of 10.000% per annum payable in cash, accruing from the settlement date, provided that for each interest payment through and including July 15, 2017, we may, at our option, pay interest in kind by issuing additional New Second Lien Notes (“PIK Notes”). Interest paid in kind will accrue at a rate per annum of 11.000%, and any PIK Notes will be fungible with, and will accrue interest at the same rate as, the New Second Lien Notes. The New Second Lien Notes have a maturity date of September 24, 2019, subject to earlier termination if any of the Existing Notes remain outstanding as of March 31, 2019. The liens securing the New Second Lien Notes are junior to the liens securing the Senior Loan Facility and are senior to the liens securing the Existing Notes. Concurrently with the Exchange Offer, we solicited consents from holders of the Existing Notes to adopt certain proposed amendments to the indenture under which the Existing Notes were issued, the existing intercreditor agreement, and related collateral and security agreements relating to the Existing Notes.
On June 29, 2016, we and the Supporting Holders entered into a $30 million multi-draw senior secured term loan facility (the "Senior Loan Facility"). All holders of Existing Notes that participated in the Exchange Offer were also able to participate in the Senior Loan Facility. Borrowings under the Senior Loan Facility bear interest at a rate of 10.000% per annum, paying monthly. The Senior Loan Facility has a maturity date of January 2, 2018, unless terminated earlier. As part of the consideration for providing the Senior Loan Facility, we issued to the lenders under the Senor Loan Facility shares equal to 28.2% of the outstanding shares of our common stock as of the Closing Date, or 2,803,302 shares, after giving effect to the Reverse Stock Split (the “New Senior Lender Shares”).
On August 1, 2016, we had 9,334,288 shares of our common stock outstanding, and, of that number, 9,213,804 shares were issued to the New Holders.
In connection with the Restructuring, on July 27, 2016, we and the New Holders entered into a Registration Rights Agreement under which we agreed to use commercially reasonable efforts to file a shelf registration statement with the SEC covering the resale of the shares issued in the Restructuring (as amended, the “New Holders Registration Rights Agreement”). Pursuant to the New Holders Registration Rights Agreement, we are registering the resale by the New Holders identified herein from time to time of 3,058,944 shares of our common stock.
Selling Stockholders Exercising “Piggy-Back” Registration Rights
On June 24, 2013, we completed a business combination in which the entity formerly known as SAExploration Holdings, Inc. (“Former SAE”) merged with and into our wholly-owned subsidiary Trio Merger Sub, Inc., now named SAExploration Sub, Inc. (“Merger Sub”), with Merger Sub surviving the merger (the “Merger”).
CLCH, LLC (“CLCH”), an affiliate of Jeff Hastings, Chief Executive Officer and Chairman of our Board, pursuant to a registration rights agreement dated June 24, 2013 entered into in connection with the Merger, has the right to demand registration of its shares of our common stock that it acquired in the Merger, and has “piggy-back” rights with respect to this offering. CLCH has exercised its “piggy-back” registration rights to register 24,221shares of our common stock for sale under this prospectus or a supplement hereto.
Certain Other Relationships with the Selling Stockholders
In connection with the Restructuring, we agreed that each Principal Stockholder would be given the right to nominate a member of our board of directors as long as it holds at least 10% of our outstanding common stock. On July 27, 2016, two of our current directors, Jacob Mercer and Michael Kass, were appointed to the board of directors following their referral to the board of directors by Whitebox Advisors LLC and BlueMountain Capital Management, LLC, respectively. The Restructuring Support Agreement also granted the Supporting Holders the right to designate six of our seven-member board of directors. In addition to the appointment of Messrs. Kassand Mercer, the Supporting Holders have appointed two members of our board of directors who served prior to the Restructuring, Brian Beatty, our Chief Operating Officer, and Gary Dalton, one of our independent directors. The Supporting Holders have the right to appoint one more member to our board of directors.
In connection with the Merger, the outstanding Series A Convertible Preferred Stock of Former SAE (the “Preferred Shares”) owned by CLCH, was redeemed for $5,000,000. Dividends on the Preferred Shares of $1,072,000 were paid to CLCH during the year ended December 31, 2014.
In connection with the Merger, we issued a promissory note in the principal amount of $17,500,000 to CLCH, as a representative of the Former SAE stockholders, as Merger consideration to the Former SAE stockholders. The promissory note was repaid with interest on July 2, 2014, at which time principal and interest in the approximate amount of $9,873,000 was received by CLCH.
Information Regarding the Selling Stockholders
The following table sets forth, to our knowledge, certain information about the selling stockholders as of August 29, 2016, the date of the table, based on information furnished to us by the selling stockholders. Except as indicated in the preceding sections or in the footnotes to the table (i) each selling stockholder has indicated to us that it is acting individually, not as a member of a group, and (ii) none of the selling stockholders or their affiliates has held any position or office or had any other material relationship with us in the past three years except as set forth above.
Beneficial ownership is determined in accordance with the rules of the SEC, and includes voting or investment power with respect to the securities. To our knowledge, except as indicated by footnote, and subject to community property laws where applicable, the persons named in the table below have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them. Shares of common stock underlying derivative securities, if any, that currently are exercisable or convertible or are scheduled to become exercisable or convertible for or into shares of common stock within 60 days after the date of the table are deemed to be outstanding in calculating the percentage ownership of each listed person or group but are not deemed to be outstanding as to any other person or group. Percentage of beneficial ownership is based on 9,343,513 shares of common stock outstanding as of the date of the table. The amount of shares shown as beneficially owned after the offering is based on the assumption that all shares being offered are sold. Our registration of the shares of common stock held by the selling stockholders, however, does not necessarily mean that they will sell all or any of the shares.
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| Name of | | Shares of Common Stock Beneficially Owned Prior to Offering (1) | | Shares of Common Stock Being | | Shares of Common Stock Beneficially Owned After Offering (2) |
| Selling Security Holder | | Number | | Percentage | | Offered | | Number | | Percentage |
| Whitebox Asymmetric Partners, LP (3) (6) | | 233,303 | | 2.50% | | 19,352 | | 213,951 | | 2.29% |
| Whitebox Credit Partners, LP (3) (7) | | 317,722 | | 3.40% | | 26,354 | | 291,368 | | 3.12% |
| Whitebox Multi-Strategy Partners, LP (3) (8) | | 943,607 | | 10.10% | | 78,271 | | 865,336 | | 9.26% |
| Whitebox Institutional Partners, LP (3) (9) | | 87,946 | | 0.94% | | 7,295 | | 80,651 | | 0.86% |
| WBox 2015-7 Ltd. (4) (10) | | 1,026,461 | | 10.99% | | 1,026,461 | | 0 | | 0.00% |
| BlueMountain Credit Alternatives Master Fund L.P. (5) (11) | | 1,674,107 | | 17.92% | | 733,269 | | 940,838 | | 10.07% |
| BlueMountain Guadalupe Peak Fund L.P. (5) (12) | | 80,647 | | 0.86% | | 35,327 | | 45,320 | | 0.49% |
| BlueMountain Montenvers Master Fund SCA SICAV-SIF (5) (13) | | 373,365 | | 4.00% | | 163,531 | | 209,834 | | 2.25% |
| BlueMountain Summit Trading L.P. (5) (14) | | 160,171 | | 1.71% | | 70,156 | | 90,015 | | 0.96% |
| BlueMountain Kicking Horse Fund L.P. (5) (15) | | 61,411 | | 0.66% | | 26,901 | | 34,510 | | 0.37% |
| BlueMountain Timberline Ltd. (5) (16) | | 59,405 | | 0.64% | | 4,927 | | 54,478 | | 0.58% |
| Morgan Stanley Global Fixed Income Opportunities Fund (5) (17) | | 58,335 | | 0.62% | | 46,733 | | 11,602 | | 0.12% |
| Morgan Stanley Institutional Fund Trust High Yield (5) (18) | | 104,907 | | 1.12% | | 70,100 | | 34,807 | | 0.37% |
| Sunsuper Superannuation Fund (5) (19) | | 32,649 | | 0.35% | | 23,367 | | 9,282 | | 0.10% |
| John Pecora (5) | | 372,846 | | 3.99% | | 140,796 | | 232,050 | | 2.48% |
| Aristides Fund QP, LP (4) (20) | | 48,686 | | 0.52% | | 48,686 | | 0 | | 0.00% |
| Aristides Fund LP (4) (21) | | 226,374 | | 2.42% | | 226,374 | | 0 | | 0.00% |
| Amzak Capital Management LLC (4) (22) | | 140,796 | | 1.51% | | 140,796 | | 0 | | 0.00% |
| Tegean Master Fund Ltd. (4) (23) | | 136,436 | | 1.46% | | 136,436 | | 0 | | 0.00% |
| Speculative Seismic Investments, LLC (5) (24) | | 142,968 | | 1.53% | | 33,812 | | 109,156 | | 1.17% |
| CLCH, LLC (25) | | 24,221 | | 0.26% | | 24,221 | | 0 | | 0.00% |
| Unallocated Shares | | 194 | | 0.00% | | 194 | | 0 | | 0.00% |
| Total: | | 6,306,557 | | 67.50% | | 3,083,359 | | 3,223,198 | | 34.50% |
(1) The number and percentage of shares beneficially owned is determined in accordance with Rule 13d-3 of the Securities Exchange Act of 1934, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under such rule, beneficial ownership includes any shares as to which the selling stockholder has sole or shared voting power or investment power and also any shares the selling stockholder has the right to acquire within 60 days.
(2) Assumes that all securities offered hereby will be sold.
(3) Selling stockholder is only a holder of New Second Lien Notes.
(4) Selling stockholder is only a lender under the Senior Loan Facility.
(5) Selling stockholder is both a holder of New Second Lien Notes and a lender under the Senior Loan Facility.
(6) Whitebox Asymmetric Partners, LP is a Cayman Islands limited partnership that is managed by Whitebox Advisors LLC. The following natural persons have shared voting and investment power over the registrable securities: Mark Strefling, Michael McCormick, Elissa Weddle, and Chris Hardy.
(7) Whitebox Credit Partners, LP is a British Virgin Islands limited partnership that is managed by Whitebox Advisors LLC. The following natural persons have shared voting and investment power over the registrable securities: Mark Strefling, Michael McCormick, Elissa Weddle, and Chris Hardy.
(8) Whitebox Multi-Strategy Partners, LP is a British Virgin Islands limited partnership that is managed by Whitebox Advisors LLC. The following natural persons have shared voting and investment power over the registrable securities: Mark Strefling, Michael McCormick, Elissa Weddle, and Chris Hardy.
(9) Whitebox Institutional Partners, LP is a Delaware limited partnership that is managed by Whitebox Advisors LLC. The following natural persons have shared voting and investment power over the registrable securities: Mark Strefling, Michael McCormick, Elissa Weddle, and Chris Hardy.
(10) WBox 2015-7 Ltd. is a British Virgin Islands company that is managed by Whitebox Advisors LLC. The following natural persons have shared voting and investment power over the registrable securities: Mark Strefling, Michael McCormick, Elissa Weddle, and Chris Hardy.
(11) BlueMountain Credit Alternatives Master Fund L.P. is a Cayman Islands exempted limited partnership that is managed by BlueMountain Capital Management, LLC. The following individuals, who are members of the Investment Committee of BlueMountain Capital Management, LLC, have shared voting and investment power over the registrable securities: Andrew Feldstein, Peter Greatrex, Marina Lutova, Derek Smith, and David Zorub.
(12) BlueMountain Guadalupe Peak Fund L.P. is a Delaware limited partnership that is managed by BlueMountain Capital Management, LLC. The following individuals, who are members of the Investment Committee of BlueMountain Capital Management, LLC, have shared voting and investment power over the registrable securities: Andrew Feldstein, Peter Greatrex, Marina Lutova, Derek Smith, and David Zorub.
(13) BlueMountain Montenvers Master Fund SCA SICAV-SIF is an investment company with variable share capital organized as a specialized investment fund in the form of a corporate partnership limited by shares under the laws of Luxembourg that is managed by BlueMountain Capital Management, LLC. The following individuals, who are members of the Investment Committee of BlueMountain Capital Management, LLC, have shared voting and investment power over the registrable securities: Andrew Feldstein, Peter Greatrex, Marina Lutova, Derek Smith, and David Zorub.
(14) BlueMountain Summit Trading L.P. is a Delaware limited partnership that is managed by BlueMountain Capital Management, LLC. The following individuals, who are members of the Investment Committee of BlueMountain Capital Management, LLC, have shared voting and investment power over the registrable securities: Andrew Feldstein, Peter Greatrex, Marina Lutova, Derek Smith, and David Zorub.
(15) BlueMountain Kicking Horse Fund L.P. is a Cayman Islands exempted limited partnership that is managed by BlueMountain Capital Management, LLC. The following individuals, who are members of the Investment Committee of BlueMountain Capital Management, LLC, have shared voting and investment power over the registrable securities: Andrew Feldstein, Peter Greatrex, Marina Lutova, Derek Smith, and David Zorub.
(16) BlueMountain Timberline Ltd. is a Cayman Islands exempted company that is managed by BlueMountain Capital Management, LLC. The following individuals, who are members of the Investment Committee of BlueMountain Capital Management, LLC, have shared voting and investment power over the registrable securities: Andrew Feldstein, Peter Greatrex, Marina Lutova, Derek Smith, and David Zorub.
(17) Morgan Stanley Global Fixed Income Opportunities Fund is a registered investment company under the Investment Company Act of 1940.
(18) Morgan Stanley Institutional Fund Trust High Yield is a registered investment company under the Investment Company Act of 1940.
(19) Sunsuper Superannuation Fund is a superannuation fund managed by Sunsuper Pty Ltd. and by Morgan Stanley Investment Mgmt Inc. as investment advisory. The natural person who controls the voting and disposition of our shares for Sunsuper Superannuation Fund through Sunsuper Pty Ltd. is Ben Swan.
(20) The natural person who controls the voting and disposition of our shares for Aristides Fund QP, LP is Christopher M. Brown.
(21) The natural person who controls the voting and disposition of our shares for Aristides Fund LP is Christopher M. Brown.
(22) The natural person who controls the voting and disposition of our shares for Amzak Capital Management LLC is Michael Kazma.
(23) Tegean Master Fund, Ltd. is a registered investment company under the Investment Company Act of 1940.
(24) The natural person who controls the voting and disposition of our shares for Speculative Seismic Investments, LLC, a Delaware limited liability company, is Jeff Hastings. Jeff Hastings is Chief Executive Officer and Chairman of our board of directors.
(25) The natural person who controls the voting and disposition of our shares for CLCH, LLC, an Alaskan limited liability company, is Jeff Hastings. Jeff Hastings is Chief Executive Officer and Chairman of our board of directors.
PLAN OF DISTRIBUTION
The selling stockholders and any of their pledgees, donees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of our common stock being offered under this prospectus or a supplement hereto on any stock exchange, market or trading facility on which the shares are traded or in private transactions. These sales may be at prevailing market prices or negotiated prices. The selling stockholders may use any one or more of the following methods when disposing of shares:
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
to or through underwriters;
block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
purchases by a broker-dealer as principal and resales by the broker-dealer for its account;
an exchange distribution in accordance with the rules of the applicable exchange;
privately negotiated transactions;
to cover short sales made after the date that the registration statement, of which this prospectus is a part, is declared effective by the SEC;
broker-dealers may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share;
through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
a combination of any of these methods of sale; and
any other method permitted pursuant to applicable law.
We or any of the selling security holders may also enter into hedging transactions. For example, we or any of the selling security holders may:
enter into transactions with a broker-dealer or affiliate thereof in connection with which such broker-dealer or affiliate will engage in short sales of the common stock pursuant to this prospectus, in which case such broker-dealer or affiliate may use shares of common stock received from us to close out its short positions;
sell securities short and redeliver such shares to close out our short positions;
enter into option or other types of transactions that require us to deliver common stock to a broker-dealer or an affiliate thereof, who will then resell or transfer the common stock under this prospectus; or
loan or pledge the common stock to a broker-dealer or an affiliate thereof, who may sell the loaned shares or, in an event of default in the case of a pledge, sell the pledged shares pursuant to this prospectus.
In addition, we or any of the selling security holders may enter into derivative or hedging transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. In
connection with such a transaction, the third parties may sell securities covered by and pursuant to this prospectus and an applicable prospectus supplement or pricing supplement, as the case may be. If so, the third party may use securities borrowed from us or any of the selling security holders or others to settle such sales and may use securities received from us to close out any related short positions. We may also loan or pledge securities covered by this prospectus and an applicable prospectus supplement to third parties, who may sell the loaned securities or, in an event of default in the case of a pledge, sell the pledged securities pursuant to this prospectus and the applicable prospectus supplement or pricing supplement, as the case may be.
A prospectus supplement with respect to each offering of securities will state the terms of the offering of the securities, including:
the name or names of any underwriters or agents and the amounts of securities underwritten or purchased by each of them, if any;
the public offering price or purchase price of the securities and the net proceeds to be received by us from the sale;
any delayed delivery arrangements;
any underwriting discounts or agency fees and other items constituting underwriters' or agents' compensation;
any discounts or concessions allowed or reallowed or paid to dealers; and
any securities exchange or markets on which the securities may be listed.
The offer and sale of the securities described in this prospectus by us, any of the selling security holders, the underwriters or the third parties described above may be effected from time to time in one or more transactions, including privately negotiated transactions, either:
at a fixed price or prices, which may be changed;
at market prices prevailing at the time of sale;
at prices related to the prevailing market prices; or
at negotiated prices
The shares may also be sold under Rule 144 or Regulation S under the Securities Act of 1933, as amended (“Securities Act”), if available, rather than under this prospectus. The selling stockholders have the sole and absolute discretion not to accept any purchase offer or make any sale of shares if they deem the purchase price to be unsatisfactory at any particular time.
A distribution of the securities offered by this prospectus may also be effected through the issuance of derivative securities, including without limitation, warrants, subscriptions, exchangeable securities, forward delivery contracts and the writing of options.
The selling stockholders may pledge their shares to their brokers under the margin provisions of customer agreements. If a selling stockholder defaults on a margin loan, the broker may, from time to time, offer and sell the pledged shares.
Broker-dealers engaged by the selling stockholders may arrange for other broker-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the selling stockholders (or, if any broker-dealer
acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated, which commissions as to a particular broker or dealer may be in excess of customary commissions to the extent permitted by applicable law.
If sales of shares offered under this prospectus are made to broker-dealers as principals, we would be required to file a post-effective amendment to the registration statement of which this prospectus is a part. In the post-effective amendment, we would be required to disclose the names of any participating broker-dealers and the compensation arrangements relating to such sales.
The selling stockholders and any broker-dealers or agents that are involved in selling the shares offered under this prospectus may be deemed to be “underwriters” within the meaning of the Securities Act in connection with these sales. Commissions received by these broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. Any broker-dealers or agents that are deemed to be underwriters may not sell shares offered under this prospectus unless and until we set forth the names of the underwriters and the material details of their underwriting arrangements in a supplement to this prospectus or, if required, in a replacement prospectus included in a post-effective amendment to the registration statement of which this prospectus is a part.
The selling stockholders and any other persons participating in the sale or distribution of the shares offered under this prospectus will be subject to applicable provisions of the Securities Exchange Act of 1934, as amended (“Exchange Act”), and the rules and regulations under that act, including Regulation M. These provisions may restrict activities of, and limit the timing of purchases and sales of any of the shares by, the selling stockholders or any other person. Furthermore, under Regulation M, persons engaged in a distribution of securities are prohibited from simultaneously engaging in market making and other activities with respect to those securities for a specified period of time prior to the commencement of such distributions, subject to specified exceptions or exemptions. All of these limitations may affect the marketability of the shares.
If any of the shares of our common stock offered for resale pursuant to this prospectus are transferred other than pursuant to a sale under this prospectus, then subsequent holders could not use this prospectus until a post-effective amendment or prospectus supplement is filed, naming such holders. We offer no assurance as to whether any of the selling stockholders will sell all or any portion of the shares offered under this prospectus.
DESCRIPTION OF SECURITIES
General
CAPITAL STOCKAs of the date of this prospectus, we are authorized to issue 55,000,00040,000,000 shares of common stock, par value $0.0001,Common Stock, and 1,000,000 shares of preferred stock, par value $0.0001. As of the date of this prospectus: 9,343,5133,100,496 shares of our common stockCommon Stock are outstanding, held by 13651 stockholders of record, and no shares of our preferred stock are outstanding. We have reserved for issuance 1,038,2582,750,000 shares of our common stockCommon Stock for grants under our new 2016Amended and Restated 2018 Long-Term Incentive Plan, 308,217as amended, 4,389,614 shares for issuance upon exercise of the existing Warrants described below, and approximately 132,09210,434,783 shares initially issuable upon full conversion of the Convertible Notes (or up to 15,000,000 shares of Common Stock issuable upon a Make-Whole Fundamental Change) and/or exercise of the lenders underConversion Warrants described below.
Common Stock
Under the Senior Loan Facility as an anti-dilution protection relative to the Warrants.
On August 3, 2016, the board of directors adopted resolutions authorizing the amendment and restatement of our Second Amended and Restated Certificate of Incorporation as amended by our Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation (the “Existing Charter”) in a Third Amended and Restated CertificateArticles of Incorporation (the “New Charter”) in order to effect a number of changes contemplated by(as amended, the Restructuring Support Agreement, as well as additional changes to the Existing Charter meant to update it to reflect the latest market practices. On August 4, 2016, following the approval by the board of directors, the New Charter was approved by the written consent of our stockholders holding a majority of the outstanding shares of common stock entitled to vote as of August 3, 2016. The New Charter will become effective upon its filing with the Secretary of State of the State of Delaware, which is expected to occur on or around September 6, 2016, which is 20 calendar days after an information statement is mailed to our stockholders relating to the action taken by written consent.
Common Stock
Under the Existing Charter, our stockholders of record are entitled to one vote for each share held on all matters to be voted on by our stockholders, including the election of our board of directors. Under the New Charter,“Charter”), each holder of our common stockCommon Stock will be entitled to one vote for each share of common stock,Common Stock, subject to any rights granted to any future holders of preferred stock and any effect of Section 2.9 of ourBy-Laws. Section 2.9 of ourBy-Laws prevents any investment entity that is not a “United States person,” as defined in Section 7701(a)(30) of the Internal Revenue Code of 1986, and that is managed by BlueMountain Capital Management, LLC or its affiliates (a “Non-U.S. Entity”“Non-U.S. Blue Mountain Investment Fund”), from possessing 10% or greater of the votes applicable to the outstanding common stock.Common Stock. The effect of this will be to eliminate the voting power of anyNon-U.S. Entity’s common stock Blue Mountain Investment Fund’s Common Stock to the extent it provides 10% or greater of the voting power of our outstanding common stock.Common Stock. If this were to occur, the other stockholders would possess greater voting power due to the reduction in the total shares able to vote.
Pursuant to the Existing Charter our board of directors is divided into three classes and currently consists of six directors, of whom two serve until the annual meeting of our stockholders to be held in 2017, three serve until the annual meeting to be held in 2018, and one who will serve until the annual meeting to be held in 2019. Under the Existing Charter, each class serves for a term of three years with only one class of directors being elected in each year. The New Charter, when effective, will de-classify our board of directors and require that all directors beare elected on an annual basis beginning at our 2016 annual meeting of stockholders, at which time allbasis. In addition, the terms of the current directors will expire. The New Charter states that any vacancies on the board of directors may be filled by an affirmative vote of a majority of the remaining members; provided, that for so long as any Principal Stockholder (as defined in the Charter) holds (together with its affiliates, excluding us and our other affiliates) at least tennine percent (10%(9%) of the outstanding Common Stock, if there is a vacancy of a director nominated by eitherone of the Principal Stockholders, then the nominating Principal Stockholder is entitled to nominate a successor to such director, and we and our board of directors must take all actions necessary to ensure that person is appointed to the board of directors as promptly as practicable.
Our common stockholders have no liquidation, conversion, preemptive, or other subscription rights and there are no sinking fund or redemption provisions applicable to the shares of common stock.
The New Charter adopts Delaware asCommon Stock.Unless we consent in writing to the selection of an alternative forum, the sole and exclusive jurisdictionforum for (a) any derivative action or proceeding brought on our behalf,behalf; (b) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, or employees agents, or agents ofto us or our stockholders,stockholders; (c) any action asserting a claim arising pursuant to any provisions of the Delaware General Corporation Law of(the “DGCL”), the State of Delaware, the New Charter, or our By-Laws,By-Laws; or (d) any action asserting a claim governed by the internal affairs doctrine shall, in each case, be the Court of Chancery of the State of Delaware. If the Court of Chancery of the State of Delaware lacks jurisdiction over such action or proceeding, the sole and exclusive forum for such action or proceeding shall be another court of the State of Delaware or, if no court of the State of Delaware has jurisdiction, then the federal district court offor the District of Delaware.
There are no shares of our preferred stock outstanding. The Existing Charter and the soon-to-be effective New Charter each authorizeauthorizes the issuance of 1,000,000 shares of preferred stock, par value $0.0001 per share, with such designations, rights and preferences as may be determined from time to time by our board of directors. Accordingly, our board of directors is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, conversion, voting or other rights which could adversely affect the voting power or other rights of the holders of our common stock.Common Stock. We
may issue some or all of the preferred stock to effect a business combination. In addition, the preferred stock could be utilized as a method of discouraging, delaying or preventing a change in control of us. Although we do not currently intend to issue any shares of preferred stock, we cannot assure you that we will not do so in the future.
Convertible Notes
We issued the Convertible Notes under an Indenture (the “Indenture”), dated as of September 26, 2018, by and among us, as issuer, the guarantors party thereto (the “Notes Guarantors”), and Wilmington Savings Fund Society, FSB, as trustee and collateral trustee (the “Trustee”), establishing the terms and providing for the issuance of the Convertible Notes. We sold the Convertible Notes pursuant to that certain Note Purchase Agreement, dated as of September 26, 2018, by and among us, the Notes Guarantors and the purchasers thereto.
Subject to and upon compliance with the Indenture, each holder of a Convertible Note shall have the right, at such holder’s option, at any time prior to the close of business on the second business day preceding September 26, 2023 (the “Maturity Date”), to convert all or a portion of such Convertible Note, at an initial conversion rate of 173.91304 shares of Common Stock (subject to customary adjustment as provided in the Indenture) (the “Conversion Rate”) per $1,000 principal amount of Convertible Notes into shares of Common Stock or Conversion Warrants to purchase Conversion Warrant Shares (the “Conversion Obligation”). The initial Conversion Price (as defined in the Indenture) was approximately $5.75 per share of Common Stock as of the date of issuance. There are 10,434,783 shares of Common Stock initially issuable upon full conversion of the Convertible Notes and/or exercise of the Conversion Warrant (or up to 15,000,000 shares of Common Stock issuable upon a Make-Whole Fundamental Change).
The Conversion Rate is subject to adjustment upon the occurrence of certain events. In addition, following certain corporate events that occur prior to the Maturity Date, we will increase, in certain circumstances, the Conversion Rate for a holder who elects to convert its Convertible Notes in connection with such a corporate event. Upon conversion, we may settle our Conversion Obligation in cash; the Conversion Shares (or, if applicable, Conversion Warrants), together with cash, if applicable, in lieu of delivering any fractional Conversion Share (or, if applicable, Conversion Warrant); or a combination of cash and Conversion Shares (or, if applicable, Conversion Warrants), at our election.
If a holder of Convertible Notes elects to convert such holder’s Convertible Notes into Conversion Warrants, the Conversion Warrants will be issued pursuant to an agreed form of warrant agreement with Continental Stock Transfer and Trust Company (“CST”), as warrant agent. Such Conversion Warrants will be exercisable at an exercise price of $0.0001 per share, subject to adjustment pursuant to customary anti-dilution provisions and will be generally exercisable at any time and from time to time.
We may not redeem the Convertible Notes prior to October 1, 2021. After October 1, 2021, we may redeem all or part of the Convertible Notes, at our option, if the last reported sale price of the Common Stock has been at least 150% of the conversion price then in effect (i) on the trading day immediately preceding the date on which we provide notice of redemption and (ii) for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which we provide notice of redemption at a redemption price equal to 100% of the principal amount of the Convertible Notes to be redeemed, payable in cash, plus accrued and unpaid interest and any make whole premium (as described in the Indenture).
If a Fundamental Change (as defined in the Indenture) occurs, then holders of the Convertible Notes may, subject to certain restrictions, require us to repurchase for cash all or part of the Convertible Notes in principal amounts of $1,000 or an integral multiple thereof at a repurchase price equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest thereon to, but excluding, such date of repurchase.
Until such time as the Conversion Shares and the Conversion Warrant Shares, if any, are registered under the Securities Act, they will be subject to restrictions on transfer.
Warrants
Series A & B Warrants
On July 27, 2016, we entered into a warrant agreement (the “Warrant“Series A & B Warrant Agreement”) with Continental Stock Transfer and Trust Company,CST, as warrant agent. Pursuant to the Series A & B Warrant Agreement, we issued two series of warrants (the “Series A Warrants” and “Series B Warrants” and, together, the “Series A & B Warrants,” together, the “Warrants”Warrants”) to the holders of our common stockCommon Stock as of July 26, 2016. We issued 154,108154,376 Series A Warrants outstanding to purchase up to, after giving effect to the reverse stock split on September 13, 2018, an aggregate of 154,1087,719 shares of common stockCommon Stock at an initial and current exercise price of $10.30 per share, (the “Series A Exercise Price”)subject to further adjustment pursuant to customary anti-dilution provisions and 154,108154,376 Series B Warrants outstanding to purchase up to, after giving effect to the reverse stock split on September 13, 2018, an aggregate of 154,1087,719 shares of common stockCommon Stock at an initial and current exercise price of $12.88 per share, (the “Seriessubject to further adjustment pursuant to customary anti-dilution provisions. The Series A & B Exercise Price”). The Warrants expire at the close of business on July 27, 2021 (the “Expiration Date”).2021. The Series A & B Warrants may generallyonly be exercised during the period commencingwithin 30 days prior toof the Expiration Date, subject to our receipt of certain Alaska tax credits.Date. The shares to be issued under the Series A & B Warrants represent 4.5%less than 1% of the outstanding shares of our common stockCommon Stock as of July 27, 2016, before any dilution caused byDecember 4, 2018 on a fully diluted basis.
Series C Warrants
On January 29, 2018, we entered into a warrant agreement (the “Series C Warrant Agreement”) with CST, as warrant agent. Pursuant to the issuanceSeries C Warrant Agreement, we issued 8,286,061 warrants (the “Series C Warrants”). As of (i) additionalDecember 4, 2018, there were 7,947,428 Series C Warrants outstanding. The Series C Warrants give the holder the right to purchase up to, after giving effect to the reverse stock split on September 13, 2018, an aggregate of 397,371 shares of common stockCommon Stock at an initial exercise price of $0.0001 per share, subject to further adjustment pursuant to customary anti-dilution provisions. The Series C Warrants may generally be exercised at any time and from time to time. The shares of Common Stock to be issued under our 2016 Long-Term Incentive Plan, which reserves 1,038,258the Series C Warrants represent 1.9% of the outstanding shares of our common stock for issuance, and (ii) approximately 132,093 sharesCommon Stock as of our common stock to the lenders under the Senior Loan Facility as an anti-dilution protection relative to the Warrants.
December 4, 2018 on a fully diluted basis.Until such time as the Series C Warrants and the shares of common stockCommon Stock issuable underupon exercise of the Series C Warrants are registered under the Securities Act, of 1933, as amended, they will be subject to restrictions on transfer. We have agreed in
Series D Warrants
On March 8, 2018, we entered into a warrant agreement (the “Series D Warrant Agreement”) with CST, as warrant agent. Pursuant to the Series D Warrant Agreement, we issued 14,098,370 warrants (the “Series D Warrants”). As of December 4, 2018, there were 11,748,370 Series D Warrants outstanding, which give the holders the right to purchase up to, after giving effect to the reverse stock split on September 13, 2018, an aggregate of 587,419 shares of the Common Stock at an initial exercise price of $0.0001 per share, subject to further adjustment pursuant to customary resale registration rights.anti-dilution provisions. The Series D Warrants may generally be exercised at any time and from time to time. The shares of Common Stock to be issued under the Series D Warrants represent 2.9% of the outstanding shares of our Common Stock as of December 4, 2018 on a fully diluted basis.
Until such time as the Series D Warrants and the shares of Common Stock issuable upon exercise of the Series D Warrants are registered under the Securities Act, they will be subject to restrictions on transfer.
Series E Warrants
On September 6, 2018, the Company entered into a warrant agreement (the “Series E Warrant Agreement”) with CST, as warrant agent. Pursuant to the Series E Warrant Agreement, we issued 94,813,594 warrants (the
“Series E Warrants’ and, together with the Series A & B Warrants, the Series C Warrants, and the Series D Warrants, the “Existing Warrants”). As of December 4, 2018, there were 67,787,724 Series E Warrants outstanding, which give the holder the right to purchase up to, after giving effect to the reverse stock split on September 13, 2018, an aggregate of 3,389,386 shares of Common Stock, subject to further adjustment pursuant to customary anti-dilution provisions, at an exercise price of $0.0001 per share. The Series E Warrants may generally be exercised at any time and from time to time. The shares of Common Stock to be issued under the Series E Warrants represent 16.6% of the outstanding shares of our Common Stock as of December 4, 2018 on a fully diluted basis.
Until such time as the Series E Warrants and the shares of Common Stock issuable upon exercise of the Series E Warrants are registered under the Securities Act, they will be subject to restrictions on transfer.
Conversion Warrants
See the above description under “—Convertible Notes.”
Dividends
We have not paid any cash dividends on our common stockCommon Stock to date. It is the present intention of our board of directors to retain all earnings, if any, for use in our business operations and, accordingly, our board does not anticipate declaring any dividends in the foreseeable future. The payment of dividends will be within the discretion of our board of directors and will be contingent upon our revenues and earnings, if any, capital requirements and general financial condition, and the restrictions on dividends under our current financing arrangements.arrangements
Delaware Law
We are subject to the provisions of Section 203 of the DGCL regulating corporate takeovers. In general, those provisions prohibit a Delaware corporation from engaging in any business combination with any “interested stockholder” (as defined in the DGCL) for a period of three years following the date that the stockholder became an interested stockholder, unless:
the transaction is approved by the board of directors before the date the interested stockholder attained that status;
upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced; or
on or after such time the business combination is approved by the board of directors and authorized at a meeting of stockholders by at leasttwo-thirds of the outstanding voting stock that is not owned by the interested stockholder.
Section 203 defines “business combination” to include the following:
any merger or consolidation involving the corporation and the interested stockholder;
any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested stockholder;
subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;
any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; or
the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.
In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by any of these entities or persons.
A Delaware corporation may “opt out” of Section 203 with an express provision in its original certificate of incorporation or an express provision in its certificate of incorporation or bylaws resulting from amendments approved by the holders of at least a majority of the corporation’s outstanding voting shares. We have not opted out of the provisions of Section 203. The statute could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us.
Transfer Agent and Registrar
The transfer agent for our Common Stock is Continental Stock Transfer & Trust Company, 1 State Street, 30th Floor, New York, New York 10004.
Listing
Our Common Stock trades on the Nasdaq Capital Market under the symbol “SAEX.” Our Series A & B Warrants trade on the OTCQB market under the shared symbol “SXPLW.”
SELLING STOCKHOLDERS
This prospectus relates to the possible resale by certain of our stockholders, to whom we refer in this prospectus as the “selling stockholders,” of up to an aggregate of 19,616,831 shares of Common Stock held by the selling stockholders identified below under this prospectus, subject to any appropriate adjustment as a result of any subdivision, split, combination or other reclassification of our Common Stock. 10,173,913 shares of Common Stock are initially issuable upon full conversion of the Convertible Notes and/or exercise of the Conversion Warrants (or up to 14,625,000 shares of Common Stock issuable upon a Make-Whole Fundamental Change). 4,197,649 shares of Common Stock are issuable upon exercise of the Series C Warrants, Series D Warrants and Series E Warrants held by such selling stockholders.
The selling stockholders originally acquired our Common Stock and securities convertible into our Common Stock included in this prospectus as investments and as participants in our ongoing recapitalization transactions through the transactions described below, except as otherwise described in the footnotes to the table below. We do not have an underwriting relationship with any of the selling stockholders, and the selling stockholders are not in the business of underwriting securities and are not registered broker-dealers.
The table below identifies the selling stockholders and other information regarding the beneficial ownership of the Common Stock by the selling stockholders. The amounts listed under “Ownership of Common Stock Prior to Offering” represent the number and percentage of shares of Common Stock beneficially owned by the selling stockholders as of December 7, 2018. Because the selling stockholders may resell all or part of their shares, no estimates can be given as to the number of shares of Common Stock that will be held by the selling stockholders upon termination of any offering made hereby. For purposes of the table below, however, we have assumed that after termination of this offering none of the shares covered by this prospectus will be held by the selling stockholders. The percentages of shares owned are based on 3,100,496 shares of our Common Stock outstanding as of December 4, 2018. Beneficial ownership has been determined under rules promulgated by the SEC. The information does not necessarily indicate beneficial ownership for any other purpose. The selling stockholders may from time to time offer and sell pursuant to this prospectus any or all of the Common Stock owned by them but make no representation that any of the Common Stock will be offered for sale.
We prepared the table based on information provided to us by the selling stockholders. We have not sought to verify such information. Additionally, the selling stockholders may have sold or transferred some or all of their shares of our Common Stock in transactions exempt from the registration requirements of the Securities Act since the date on which the information in the table was provided to us. Other information about the selling stockholders may also change over time. The selling stockholders include the persons and entities identified in the following schedule and the pledgees, donees (including charitable organizations), distributees, transferees, affiliates, or othersuccessors-in-interest.
| | | | | | | | | | | | | | | | | | | | |
Selling Stockholders | | Ownership of Common
Stock Prior to Offering | | | Offered
Hereby | | | Ownership of Common Stock
After Offering | |
| | | Number | | | Percentage (1) | | | | | | Number | | | Percentage(1) | |
Whitebox Asymmetric Partners, LP(2) | | | 289,199 | | | | 8.58 | % | | | 1,220,699 | | | | — | | | | — | |
Whitebox Credit Partners, LP(2) | | | 393,695 | | | | 11.35 | % | | | 1,661,445 | | | | — | | | | — | |
Whitebox Multi-Strategy Partners, LP(2) | | | 1,172,389 | | | | 27.96 | % | | | 4,948,139 | | | | — | | | | — | |
Whitebox Institutional Partners, LP(2) | | | 109,043 | | | | 3.40 | % | | | 109,043 | | | | — | | | | — | |
BlueMountain Funds (3) | | | 330,748 | | | | 9.99 | % | | | 4,809,028 | | | | — | | | | — | |
1992 MSF International Ltd.(4) | | | 323,825 | | | | 9.99 | % | | | 3,132,486 | | | | — | | | | — | |
1992 Tactical Credit Master Fund, L.P.(4) | | | 337,124 | | | | 9.99 | % | | | 2,228,097 | | | | — | | | | — | |
Amzak Capital Management, LLC(5) | | | 164,020 | | | | 5.29 | % | | | 539,020 | | | | — | | | | — | |
Morgan Stanley Investment Management Inc. (6) | | | 168,874 | | | | 5.39 | % | | | 168,874 | | | | — | | | | — | |
John Pecora (7) | | | — | | | | — | | | | 550,000 | | | | — | | | | — | |
Jeff Hastings(8) | | | 59,209 | | | | 1.91 | % | | | 250,000 | | | | 59,209 | | | | 1.77 | % |
| * | Represents ownership of less than one percent (1%). |
| (1) | The percentage of beneficial ownership is calculated based on 3,100,496 shares of Common Stock deemed outstanding as of December 4, 2018. |
| (2) | The business address of the reporting person is 3033 Excelsior Blvd., Suite 300, Minneapolis, Minnesota 55416. Whitebox General Partner LLC is the general partner of the reporting person. Whitebox General Partner LLC is owned by Andrew Redleaf, Robert Vogel, Mark Strefling, Paul Twitchell, Richard Vigilante and Dyal Capital Partners II (B) LP. Messrs. Redleaf, Vogel, Strefling, Twitchell and Vigilante share voting and dispositive power over all of the shares of Whitebox General Partner LLC. Whitebox Advisors LLC is the investment manager of the reporting person. Whitebox Advisors LLC is owned by Andrew Redleaf, Robert Vogel, Mark Strefling, Paul Twitchell, Richard Vigilante and Dyal Capital Partners II (A) LP. The address of these persons is 3033 Excelsior Blvd, Suite 300, Minneapolis, MN 55416. The foregoing information was derived from a Schedule 13D/A filed on October 5, 2018, in which the reporting person identifies itself as having shared voting and dispositive power over 1,964,326 shares of our Common Stock, which includes (i) 130,450 shares of Common Stock and (ii) 1,833,876 additional shares of Common Stock issuable upon the exercise of 2,446,026 Series C Warrants, 4,997,800 Series D Warrants and 29,233,812 Series E Warrants, all of which the reporting person could exercise within 60 days of October 16, 2018. The Schedule 13D/A further indicated that Whitebox General Partner LLC has shared voting and dispositive power over 1,964,326 shares of Common Stock, Whitebox Multi-Strategy Partners, LP has shared voting and dispositive power over 1,172,389 shares of Common Stock, Whitebox Credit Partners, LP has shared voting and dispositive power over 393,695 shares of Common Stock, Whitebox Asymmetric Partners, LP has shared voting and dispositive power over 289,199 shares of Common Stock and Whitebox Institutional Partners, LP has shared voting and dispositive power over 109,043 shares of Common Stock. The number does not include the shares of Common Stock issuable upon Conversion of the Convertible Notes. The foregoing information was also derived from our knowledge of the reporting person’s ownership of an aggregate of $23,900,000 in aggregate principal amount of Convertible Notes, convertible into a maximum of 4,156,521 shares of Common Stock at the initial conversion rate for the Convertible Notes of 173.91304 shares of Common Stock per $1,000 principal amount of Convertible Notes and up to 5,975,000 issuable upon a Make-Whole Fundamental Change (with shares of Common Stock rounded down in lieu of any |
| fractional shares). Whitebox Multi-Strategy Partners, LP directly owns $15,103,000 in principal amount of Convertible Notes Whitebox Credit Partners, LP directly owns $5,071,000 in principal amount of Convertible Notes and Whitebox Asymmetric Partners, LP directly owns $3,726,000 in principal amount of Convertible Notes. However, upon conversion of the Convertible Notes, the settlement of the conversion right may, at the option of the Company, be in the form of shares of Common Stock, cash or a combination of cash and shares of Common Stock in amounts determined in accordance with the Indenture for the Convertible Notes. Therefore, the number of shares of Common Stock and corresponding percentage set forth in the table above give effect to the cash settlement election. |
| (3) | Represents (i) 83,704 shares of Common Stock, 1,585,686 Series C Warrants, 3,239,910 Series D Warrants, 18,951,598 Series E Warrants and $8,854,000 of Convertible Notes held by Blue Mountain Credit Alternatives Master Fund L.P.; (ii) 4,032 shares of Common Stock, 76,393 Series C Warrants, 156,099 Series D Warrants and 919,281 Series E Warrants held by BlueMountain Guadalupe Peak Fund L.P.; (iii) 3,070 shares of Common Stock, 58,174 Series C Warrants, 118,862 Series D Warrants, 700,093 Series E Warrants and $325,000 of Convertible Notes held by BlueMountain Kicking Horse Fund L.P.; (iv) 8,008 shares of Common Stock, 151,711 Series C Warrants, 309,981 Series D Warrants, 1,818,934 Series E Warrants and $847,000 of Convertible Notes held by BlueMountain Summit Trading L.P.; (v) 2,970 shares of Common Stock, 91,815 Series C Warrants, 187,597 Series D Warrants and 1,102,483 Series E Warrants held by BlueMountain Timberline Ltd.; and (vi) 18,668 shares of Common Stock, 353,634 Series C Warrants, 722,542 Series D Warrants, 4,226,733 Series E Warrants and $1,974,000 of Convertible Notes held by BlueMountain Montenvers Master Fund SCASICAV-SIF (collectively, the “BlueMountain Funds”). We have been advised that the executive partners of BlueMountain Capital Management, LLC, the investment manager of the BlueMountain Funds, exercise voting and dispositive power over the Common Stock and warrants held by the BlueMountain Funds. The following natural persons, as executive partners of BlueMountain Capital Management, LLC, have shared voting and investment power over the shares and warrants: Andrew Feldstein, Stephen Siderow and Michael Liberman. Each of the aforementioned executive partners disclaim beneficial ownership of the Common Stock and warrants owned of record by the BlueMountain Funds, except to the extent of any pecuniary interest therein. The mailing address of each of the BlueMountain Funds is c/o BlueMountain Capital Management, LLC, 280 Park Ave., 12th Floor, New York, New York 10017. However, the warrant agreements for each series of warrants provides that, at all times a holder of Series C Warrants, Series D Warrants or Series E Warrants who is not a beneficial owner of 10% or more of the outstanding Common Stock, may only exercise up to that number of warrants so that, upon exercise, the aggregate beneficial ownership of Common Stock of such holder and all persons affiliated with such holder, is not more than 9.99% of Common Stock then outstanding (other than in connection with a change of control of the Issuer) (the “9.99% Blocker”). Similarly, the Indenture provides that a holder of Convertible Notes who is not a beneficial owner of 10% or more of the outstanding Common Stock, may only convert an amount of Convertible Notes so that, upon conversion, the aggregate beneficial ownership of Common Stock of such holder and all persons affiliated with such holder, is not more than 9.99% of Common Stock. Furthermore, upon conversion of the Convertible Notes, the settlement of the conversion right may, at the option of the Company, be in the form of shares of Common Stock, cash or a combination of cash and shares of Common Stock in amounts determined in accordance with the Indenture for the Convertible Notes. Therefore, the number of shares of Common Stock and corresponding percentage set forth in the table above give effect to the 9.99% Blocker and the cash settlement election. |
| (4) | Highbridge Capital Management, LLC (“HCM”), the trading manager of 1992 MSF International Ltd. and 1992 Tactical Credit Master Fund, L.P. (the “Highbridge Fund”), may be deemed to be the beneficial owner of the shares held by the Highbridge Fund. The Highbridge Fund disclaims any beneficial ownership of these shares. The business address of HCM is 40 West 57th Street, 32nd Floor, New York, New York 10019 and the business address of the Highbridge Fund is c/o HedgServ (Cayman) Ltd., Willow House, Cricket Square Floor 3, George Town, Grand Cayman KY1-1104, Cayman Islands. The reporting persons represented to us that it has shared voting and dispositive power over 316,834 shares of Common Stock, which includes (i) 245,823 shares of Common Stock and (ii) 71,011 additional shares of Common Stock issuable upon the exercise of our Series C Warrants, Series D Warrants and Series E Warrants. The number does not include the shares of Common Stock issuable upon conversion of the Convertible Notes. The |
| foregoing information was also derived from our knowledge of the reporting persons’ ownership of an aggregate of (a) 1,849,763 Series C Warrants, 1,836,004 Series D Warrants and 9,109,475 Series E Warrants convertible into 639,762 shares of Common Stock and (b) $17,900,000 in aggregate principal amount of Convertible Notes, convertible into a maximum of 3,113,043 shares of Common Stock at the initial conversion rate for the Convertible Notes of 173.91304 shares of Common Stock per $1,000 principal amount of Convertible Notes and up to 4,475,000 issuable upon a Make-Whole Fundamental Change (with shares of Common Stock rounded down in lieu of any fractional shares). 1992 MSF International Ltd. directly owns $9,900,000 in principal amount of Convertible Notes and 1992 Tactical Credit Master Fund, L.P. directly owns $8,000,000 in principal amount of Convertible Notes. However, (a) HCM’s of the Series C Warrants, Series D Warrants and Series E Warrants is subject to the 9.99% Blocker and (b) upon conversion of the Convertible Notes, the settlement of the conversion right may, at the option of the Company, be in the form of shares of Common Stock, cash or a combination of cash and shares of Common Stock in amounts determined in accordance with the Indenture for the Convertible Notes. Therefore, the number of shares of Common Stock and corresponding percentage set forth in the table above give effect to the 9.99% Blocker and the cash settlement election. 1992 MSF International Ltd. and 1992 Tactical Credit Master Fund, L.P. may not exercise a number of Series C Warrants, Series D Warrants and Series E Warrants that would cause HCM’s aggregate beneficial ownership of Common Stock to be greater than 9.99% of Common Stock then outstanding. |
| (5) | The business address of the reporting person is 980 N Federal Highway, Suite 315, Boca Raton, FL 33432. The selling stockholder represented to us that is holds an aggregate of 539,020 shares of Common Stock, which includes 375,000 shares issuable upon the conversion of Convertible Notes. Upon conversion of the Convertible Notes, the settlement of the conversion right may, at the option of the Company, be in the form of shares of Common Stock, cash or a combination of cash and shares of Common Stock in amounts determined in accordance with the Indenture for the Convertible Notes. Therefore, the number of shares of Common Stock and corresponding percentage set forth in the table above give effect to the cash settlement election. |
| (6) | The business address of the reporting person is Morgan Stanley Investment Management Inc., 522 Fifth Avenue, New York, NY 10036. The reporting person, Morgan Stanley Investment Management Inc., serves as the adviser, sub-adviser or investment manager or provides investment advisory services in a similar capacity to certain investment vehicles identified below (the “MSIM Funds”), which of which holds either Series E Warrants or Series E Warrants and shares of Common Stock issued by the Company. The reporting person represented to us that, among the MSIM Funds, it has shared voting and dispositive power over a total of 168,874 shares of Common Stock, which includes 133,437 shares of Common Stock and 35,437 additional shares of Common Stock issuable upon the exercise of 708,799 Series E Warrants, including (i) 58,271 Series E Warrants convertible into 2,913 shares of Common Stock with respect to Galaxy II Funds–US Dollar High Yield Bond Fund; (ii) 50,351 shares of Common Stock and 93,932 Series E Warrants convertible into 4696 shares of Common Stock with respect to LI Obligationer Globale High Yield, a sub-fund of Investeringsforeningen Laegernes Invest; (iii) 74,397 shares of Common Stock and 138,711 Series E Warrants convertible into 6935 shares of Common Stock with respect to LI Obligationer Globale High Yield Akk.–KL, a sub-fund of Investeringsforeningen Laegernes Invest; (iv) 192,722 Series E Warrants convertible into 9,636 shares of Common Stock with respect to Morgan Stanley Institutional Fund Trust–High Yield Portfolio; (v) 157,508 Series E Warrants convertible into 7,875 shares of Common Stock with respect to Morgan Stanley Investment Funds–Global High Yield Bond Fund; (vi) 51,502 Series E Warrants convertible into 2,575 shares of Common Stock with respect to Morgan Stanley Investment Funds–High Yield Bond Fund; and (vii) 8,689 shares of Common Stock and 16,153 Series E Warrants convertible into 807 shares of Common Stock with respect to Morgan Stanley Investment Funds–US Dollar Short Duration Fund. |
| (7) | The business address of this individual is 130 Montadale Drive, Princeton, NJ. 08540. Mr. Pecora is retired. The reporting person represented to us that he does not beneficially own any shares of common stock. The number does not include the shares of Common Stock issuable upon Conversion of the Convertible Notes. The foregoing information was also derived from our knowledge of the reporting person’s ownership of |
| $2,200,000 in principal amount of Convertible Notes, convertible into a maximum of 382,608 shares of Common Stock at the initial conversion rate for the Convertible Notes of 173.91304 shares of Common Stock per $1,000 principal amount of Convertible Notes and up to 550,000 shares issuable upon a Make-Whole Fundamental Change (with shares of Common Stock rounded down in lieu of any fractional shares). Upon conversion of the Convertible Notes, the settlement of the conversion right may, at the option of the Company, be in the form of shares of Common Stock, cash or a combination of cash and shares of Common Stock in amounts determined in accordance with the Indenture for the Convertible Notes. Therefore, the number of shares of Common Stock and corresponding percentage set forth in the table above give effect to the cash settlement election. |
| (8) | The business address of this individual is 4860 25th Street SE, Calgary, Alberta, T2B 3M2. Mr. Hastings is the Chief Executive Officer and Chairman of the Board of Directors. The amount represents 250,000 shares issuable upon conversion of $1 million principal amount of Convertible Notes held by Mr. Hastings (including shares issuable upon a Make-Whole Fundamental Change). Upon conversion of the Convertible Notes, the settlement of the conversion right may, at the option of the Company, be in the form of shares of Common Stock, cash or a combination of cash and shares of Common Stock in amounts determined in accordance with the Indenture for the Convertible Notes. Therefore, the number of shares of Common Stock and corresponding percentage set forth in the table above give effect to the cash settlement election. Mr. Hastings exercises dispositive and voting control and holds indirectly 1,350 shares through Speculative Seismic Investments, LLC and 1,211 shares through CLCH, LLC (none of which will be offered hereby). |
Registration Rights
Agreements2016 Registration Rights Agreement
On June 13, 2016, we entered into a comprehensive restructuring support agreement with certain holders (the “RSA Supporting Holders”).
On July 27, 2016, we completed an exchange offer and consent solicitation (the “2016 Exchange Offer”) related to our 10.000% Senior Secured Notes due 2019 (the “Senior Secured Notes”). In the Exchange Offer, we offered to exchange any and all of the Senior Secured Notes held by eligible holders for up to (i) $70,000,000 aggregate principal amount of 10.000% Senior Secured Second Lien Notes due 2019 (the “Second Lien Notes”) and (ii) 6,497,979 shares of our Common Stock (the “2016 Exchange Offer Shares”), upon the terms and subject to the conditions set forth in our Exchange Offer Memorandum and Consent Solicitation Statement and related Letter of Transmittal and Consent, each dated June 24, 2016. In exchange for $138,128,000 in aggregate principal amount of Senior Secured Notes, representing approximately 98.7% of the then-outstanding aggregate principal amount of the Senior Secured Notes, validly tendered and accepted for exchange in the Exchange Offer, the Company issued (i) $69,064,000 aggregate principal amount of the Second Lien Notes and (ii) 6,410,502 2016 Exchange Offer Shares. The Company delivered cash in lieu of any fractional shares.
In addition, we, as borrower, and each of our domestic subsidiaries, as guarantors, entered into a new senior secured multi-draw term loan facility (as amended, the “Term Loan”) with the lenders, including the RSA Supporting Holders, from time to time party thereto, and Delaware Trust Company, as collateral agent and administrative agent. In connection with the entry into the Term Loan, we issued to the RSA Supporting Holders who also acted as lenders under the Term Loan the Series A & B Warrants and 2,803,302 shares of Common Stock (the “Term Loan Shares”). The Term Loan Shares and 2016 Exchange Offer Shares constitute 460,690 shares of Common Stock following our20-to-1 reverse stock split on September 13, 2018.
Also on July 27, 2016, we entered into a registration rights agreement (the “New Holders“2016 Registration Rights Agreement”) with parties who received the New Holders.Common Stock issued in connection with the 2016 Exchange Offer and entry into the Term Loan. The New Holders2016 Registration Rights Agreement requiresrequired us to use itsour commercially reasonable efforts to prepare and file a shelf registration statement (a “Shelfto register the offering on a delayed or continuous basis of the 2016 Exchange Offer Shares and Term Loan Shares. 140,165 Term Loan Shares (after
giving effect to the reverse stock split on September 13, 2018) were registered under our Registration Statement filed on FormS-3 FileNo. 333-213386, which was declared effective on September 16, 2016 (the “2016 Registration Statement”).
The selling stockholders holding the 2016 Exchange Offer Shares have held such 2016 Exchange Offer Shares since July 2016.
2018 Exchange Offer Registration Rights Agreements
On January 29, 2018, we entered into a registration rights agreement (the “2018 Exchange Offer Registration Rights Agreement”) with certain holders who tendered Senior Secured Notes and Second Lien Notes in an exchange offer for shares of our Common Stock, Series A Preferred Stock (defined below), Series B Preferred Stock (defined below), and Series C Warrants (the “2018 Exchange Offer”). Pursuant to the 2018 Exchange Offer, in exchange for $78,037,389 in aggregate principal amount of Second Lien Notes, representing approximately 91.8% of the outstanding aggregate principal amount of the Second Lien Notes, validly tendered and accepted for exchange in the 2018 Exchange Offer, and $7,000 in aggregate principal amount of Senior Secured Notes, representing less than 1% of the outstanding aggregate principal amount of the Senior Secured Notes, validly tendered and accepted for exchange in the 2018 Exchange Offer, the Company issued (i) 812,321 newly issued shares of Common Stock (equivalent to 40,616 shares, after giving effect to the reverse stock split on September 13, 2018), (ii) 31,669 newly issued shares of the Company’s Series A perpetual convertible preferred stock (the “Series A Preferred Shares”), (iii) 855,195 newly issued shares of the Company’s Series B convertible preferred stock (the “Series B Preferred Shares”), which were mandatorily convertible, subject to certain conditions, and (iv) 8,286,061 newly issued Series C Warrants to, after giving effect to the reverse stock split on September 13, 2018, purchase 414,303 shares of Common Stock.
The 2018 Exchange Offer Registration Rights Agreement requires that the Company use its commercially reasonable efforts to prepare and file with the SEC a shelf registration statement registering the offering and sale on a delayed or continuous basis of all Common Stock, including Common Stock issued upon conversion of the Preferred Shares or exercise of the Series C Warrants issued in connection with the 2018 Exchange Offer to holders of 2.5% or more of the Company’s outstanding Common Stock (the “2018 Exchange Offer Registrable Securities (as defined in the New
Holders Registration Rights Agreement)Securities”), and to keep such Shelf Registration Statementshelf registration statement effective until the earliest of (i) the date as of which all 2018 Exchange Offer Registrable Securities have been sold pursuant to the Shelf Registration Statement,shelf registration statement, (ii) the date on which the New Holders2018 Exchange Offer Registration Rights Agreement terminates and (iii) such shorter period as the New Holdersholders of at least 50%75% of 2018 Exchange Offer Registrable Securities outstanding with respect to the Shelf Registrationshelf registration shall agree in writing.
Pursuant toagree.The selling stockholders holding the New Holders2018 Exchange Offer Registrable Securities have held such securities since January 2018.
Convertible Notes Registration Rights Agreement
In connection with the New Holders have customary underwrittencompletion of the offering and “piggy-back”of the Convertible Notes, the Company entered into a registration rights subject to the limitations set forth in the New Holdersagreement (the “Convertible Notes Registration Rights Agreement. Under their underwritten offering rights, individual New Holders that together own Registrable Securities representing at least 50%Agreement”), dated as of September 26, 2018, with the purchasers of the outstanding shares of our common stock have the right to demand we effectuate the distribution of any or all of their Registrable Securities by means of an underwritten offering pursuant to a Shelf Registration Statement. No individual holder may exercise this right more than two times. We are not obligated to effect an underwritten demand notice within 90 days of closing another underwritten offering. Under their “piggy-back” registration rights, if at any time we propose to conduct an underwritten offering for our own account, we must allow such New Holders to include a specified number of their Registrable Securities in the offering. These rights are subject to certain conditions and limitations, including certain rights to limit the number of shares to be included in an underwritten offering and our right to delay or withdraw a registration statement or an offer and sale of Registrable Securities pursuant to such registration statement (including underwritten offerings) under certain circumstances.Convertible Notes. The registration rights granted in the New HoldersConvertible Notes Registration Rights Agreement are subjectrequires the Company to customary indemnification and contribution provisions. We are registering the Registered Shares pursuant to the registration statement on Form S-3, of which this prospectus forms a part.
On August 25, 2016, we entered into the First Amendment to the New Holders Registration Rights Agreement (the “First Amendment”) with New Holders holding greater than a majority of the then-outstanding registrable securities under the New Holders Registration Rights Agreement. The First Amendment provides that BlueMountain Capital Management, LLC, together withuse its affiliates, and Whitebox Advisors LLC, together with its affiliates, (collectively, the “Principal Holders”) may withhold a portion of their respective Registrable Securities from the Initial Shelf Registration Statement, and subsequently require that we file additional shelf registration statements to register such additional Registrable Securities. The First Amendment also provides that commencing on February 1, 2017 through, and including, July 31, 2017, the Principal Holders may, acting jointly, effectuate the distribution of any or all of their Registrable Securities by means of an underwritten offering pursuant to the applicable shelf registration statement (a “Shelf Take-Down”) and commencing on August 1, 2017, each Principal Holder, acting separately, may initiate a Shelf Take-Down. At any time, individual registration rights holders (other than the Principal Holders) that together own Registrable Securities representing at least 50% of the outstanding Registrable Securities have the right to initiate a Shelf Take-Down.
Pursuant to the Warrant Agreement, if our board determines that it is necessary for us to file a registration statement in order for the Warrants or the common shares issuable upon exercise of the Warrants to be freely transferable, then no later than 90 days from the issuance of the Warrants, we have agreed to use commercially reasonable efforts to
cause to be filed pursuant to(i) prepare and file with the
Securities ActSEC a
shelf registration statement covering
the resaleresales of the
Warrants and such common shares (the “Warrant Shelf Registration Statement”). We have agreedConversion Shares or Conversion Warrant Shares, if any, by December 10, 2018, (ii) to use
its commercially reasonable efforts to cause the
Warrant Shelf Registration Statementshelf registration statement to
becomebe declared effective
thereafter and to remain effective untilby the
earlier of (i) such time as all Warrants and such common shares have been exercised, (ii) such time as the Warrants and such common shares are freely transferable pursuant to Rule 144SEC by January 24, 2019, and (iii)
to use its commercially reasonable efforts to keep such shelf registration statement effective through the
Expiration Date.Effectiveness Period (as defined in the Convertible Notes Registration Rights Agreement).The selling stockholders holding the Convertible Notes have held such Convertible Notes since September 2018.
PLAN OF DISTRIBUTION
We entered into a registration rights agreement with CLCH, LLC atare registering the closingCommon Stock covered by this prospectus to permit selling stockholders to conduct public secondary trading of such shares from time to time after the date of this prospectus. We will not receive any of the Merger. CLCH, LLC became an “affiliate” of ours, asproceeds from the term “affiliate” is defined under Rule 144sale of the Securities Act, as a resultCommon Stock by the selling stockholders. We will pay substantially all of the issuanceexpenses incident to this offering of shares of our common stock in the Merger. After June 24, 2014, CLCH, LLC became entitled to demand that we register the shares issuedby the selling stockholders to it in the Merger under the Securities Act. CLCH, LLC has certain “piggy-back” registration rights with respect to certain registration statements filed subsequent to consummationpublic other than commissions and discounts of the Merger. In addition, holdersunderwriters, brokers, dealers or agents.
The selling stockholders may sell all or a portion of our warrants issued by Former SAE have the right to receive 194
shares of our common stock that were issued in the Merger, which shares are held in escrow pending the exercise of such warrants, also have “piggy-back” registration rights with respect to certain registration statements we file as to the shares of our
common stock issuable upon exerciseCommon Stock beneficially owned by them and offered hereby from time to time directly to purchasers or through one or more underwriters, broker-dealers or agents, at market prices prevailing at the time of
sale, at prices related to such
warrants. CLCH, LLC has exercised such “piggy-back” registration rightsmarket prices, at a fixed price or prices subject to change or at negotiated prices, by a variety of methods including the following:on any national securities exchange orover-the-counter market on which the shares of Common Stock may be listed or quoted at the time of sale;
ordinary brokerage transactions and istransactions in which the broker-dealer solicits purchasers;
block trades in which a selling stockholder includedbroker-dealer may attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
purchases by a broker-dealer, as principal, and a subsequent resale by the broker-dealer for its account;
an exchange distribution in this prospectus.
We will bear the expenses incurred in connectionaccordance with the filingrules of allthe applicable exchange;
privately negotiated transactions;
in transactions otherwise than on such registration statements, including the one to which this prospectus relates. Pursuant to the “piggy-back” registration rights grantedexchanges or in the agreements described above,over-the-counter market;
through a combination of any such methods; or
through any other method permitted under applicable law.
In addition, the stockholders having such rights have been afforded the opportunity to be included in this prospectus as selling stockholders may enter into option, derivative or hedging transactions with respect to the shares, and any related offers or sales of commonshares may be made pursuant to this prospectus. For example, the selling stockholders may:
enter into transactions involving short sales of the shares by broker-dealers in the course of hedging the positions they assume with selling stockholders;
sell shares short themselves and deliver the shares registered hereby to settle such short sales or to close out stock coveredloans incurred in connection with their short positions;
write call options, put options or other derivative instruments (including exchange-traded options or privately negotiated options) with respect to the shares, or which they settle through delivery of the shares;
enter into option transactions or other types of transactions that require the selling stockholder to deliver shares to a broker, dealer or other financial institution, who may then resell or transfer the shares under this prospectus; or
lend or pledge the shares to a broker, dealer or other financial institution, which may sell the shares under this prospectus.
In effecting sales, brokers-dealers engaged by those agreements.the selling stockholders may arrange for other broker-dealers to participate. If the selling stockholders effect such transactions by selling the Common Stock to or through underwriters, broker-dealers or agents, such underwriters, broker-dealers or agents may receive commissions in the form of discounts, concessions or commissions from the selling stockholders or commissions from purchasers of the Common Stock for whom they may act as agent or to whom they may sell as principal.
Delaware Anti-Takeover Law
We areUnderwriters may sell securities to or through dealers, and dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for whom they may act as agent.
The selling stockholders and any underwriters, brokers, dealers or agents that participate in such distribution may be deemed to be “underwriters” within the meaning of the Securities Act, and any discounts, commissions or concessions received by any underwriters, brokers, dealers or agents might be deemed to be underwriting discounts and commissions under the Securities Act. Any selling stockholder who is an “underwriter” within the meaning of the Securities Act will be subject to the prospectus delivery requirements of the Securities Act and the provisions of Section 203the Exchange Act and the rules thereunder relating to stock manipulation.
There can be no assurance that any selling stockholders will sell any or all of the General Corporation LawCommon Stock under this prospectus. Further, we cannot assure you that any selling stockholder will not transfer, devise or gift the Common Stock by other means not described in this prospectus. In addition, any Common Stock covered by this prospectus that qualifies for sale under Rule 144 or Rule 144A of the StateSecurities Act may be sold under Rule 144 or Rule 144A rather than under this prospectus. The Common Stock covered by this prospectus may also be sold tonon-U.S. persons outside the U.S. in accordance with Regulation S under the Securities Act rather than under this prospectus. In order to comply with the securities laws of Delaware regulating corporate takeovers. This statute preventssome states, the shares sold in those jurisdictions may only be sold through registered or licensed brokers or dealers. In addition, in some states, the shares may not be sold unless the shares have been registered or qualified for sale in that state or an exemption from registration or qualification is available and is complied with.
Underwriters, dealers and agents who participate in the distribution of securities and their controlling persons may be entitled, under agreements that may be entered into with us, to indemnification by us and the selling stockholders against certain Delaware corporations,liabilities, including liabilities under certain circumstances, from engaging in a “business transaction” with:
a stockholder who owns 15%the Securities Act, or more of our outstanding voting stock (otherwise known as an “interested stockholder”);
an affiliate of an interested stockholder; or
an associate of an interested stockholder, for three years following the dateto contribution with respect to payments that the stockholder became an interested stockholder.
A “business transaction” includes a mergerunderwriters, dealers or
saleagents and their controlling persons may be required to make in respect of
more than 10% of our assets. However,those liabilities.Any underwriter may engage in stabilizing and syndicate covering transactions in accordance with Rule 104 under the above provisions of Section 203Exchange Act. Rule 104 permits stabilizing bids to purchase the underlying security so long as the stabilizing bids do not apply if:
our boardexceed a specified maximum. The underwriters may over-allot offered securities, thereby creating a short position in the underwriters’ account. Syndicate covering transactions involve purchases of directors approvesoffered securities in the transaction that madeopen market after the stockholder an “interested stockholder,” priordistribution has been completed to cover syndicate short positions. Stabilizing and syndicate covering transactions may cause the dateprice of the transaction;
after the completion of the transaction that resultedoffered securities to be higher than it would otherwise be in the stockholder becoming an interested stockholder, that stockholder ownedabsence of such transactions. These transactions, if commenced, may be discontinued at least 85% of our voting stock outstanding at the time the transaction commenced, other than statutorily excluded common stock; or
on or subsequent to the date of the transaction, the business transaction is approved by our board of directors and authorized at a meeting of our stockholders, and not by written consent, by an affirmative vote of at least two-thirds of the outstanding voting stock not owned by the interested stockholder.
Our Transfer Agent
The transfer agent for our common stock is Continental Stock Transfer & Trust Company, 17 Battery Place, New York, New York 10004.
LEGAL MATTERS
The validity of the common stock coveredsecurities being offered by this prospectus will be passed upon for us by Strasburger & Price, LLP.
Brent Whiteley, Esq., our Chief Financial Officer, General Counsel and Secretary. Mr. Whiteley presents holds shares (including restricted shares) of our common stock as well as options to purchase shares of our common stock and restricted stock units.
EXPERTS
OurThe consolidated financial statements of SAExploration Holdings, Inc. as of December 31, 20142017 and 2015,2016, and for each of the years in thetwo-year period ended December 31, 2017, and management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2017 have been auditedincorporated by reference herein in reliance upon the reports of Pannell Kerr Forster of Texas, P.C., an independent registered public accounting firm, as stated in their report, which is incorporated herein by reference from our annual report on Form 10-K for the year ended December 31, 2015 filed with the SEC on March 15, 2016. Such financial statements have been so incorporated in relianceherein, and upon the reportauthority of suchsaid firm given upon their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports and proxy statements and other information with the SEC. Our SEC filings are available to the public through the SEC’s website at http://www.sec.gov. You may also read and copy any document we file at the SEC’s public reference room in Washington, D.C. located at 100 F Street, N.E., Washington D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Information about us, including certain
SAEXPLORATION HOLDINGS, INC.
794,182 Shares of our SEC filings, is also available freeCommon Stock
14,625,000 Shares of charge through the Investor Relations sectionCommon Stock Issuable Upon Conversion of our website, located at
http://www.saexploration.com. However, the information on our website is not a part6.00% Senior Secured Convertible Notes due 20234,197,649 Shares of this prospectus or any accompanying prospectus supplement.
INFORMATION INCORPORATED BY REFERENCE
The SEC allows us to “incorporate by reference” in this prospectus the information in other documents that we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated or deemed to be incorporated by reference is considered to be a part of this prospectus, and information in documents that we file later with the SEC will automatically update and supersede information contained in documents filed earlier with the SEC or contained in this prospectus.
We incorporate by reference in this prospectus the documents listed below and any filings that we may make with the SEC subsequent to the date hereof pursuant to Sections 13(a), 13(c), 14, or 15(d)Common Stock Issuable Upon Exercise of the Exchange Act prior to the termination of the offering under this prospectus (provided, howeverWarrantsPROSPECTUS
, that we are not incorporating, in each case, any documents or information deemed to have been furnished and not filed in accordance with SEC rules):2018
Our Annual Report on Form 10-K for the fiscal year ended December 31, 2015, filed with the SEC on March 15, 2016 (and the amendment thereto filed on April 29, 2016);
Our Definitive Proxy Statement/Information Statement on Schedule 14A, filed with the SEC on June 27, 2014;
Our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016, filed with the SEC on May 16, 2016;
Our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2016, filed with the SEC on August 12, 2016;
Information Statement on Schedule 14-C, filed with the SEC on June 29, 2016;
Information Statement on Schedule 14-C, filed with the SEC on August 15, 2016;
Information Statement on Schedule 14‑C, filed with the SEC on August 17, 2016; and
Our Current Reports on Form 8-K, to the extent filed, and not furnished, with the SEC on January 26, 2016, February 5, 2016, March 3, 2016, March10, 2016, April 22, 2016, May 13, 2016, June 13, 2016, June 24, 2016, July 1, 2016, July 14, 2016, July 25, 2016, July 26, 2016, July 27, 2016, August 1, 2016, August 4, 2016, August 9, 2016, August 18, 2016, and August 25, 2016.
You may obtain a copy of any or all of the documents referred to above which may have been or may be incorporated by reference into this prospectus (excluding any exhibits to the documents that are not incorporated by reference into this prospectus) at no cost to you by writing or telephoning us at the following address:
SAExploration Holdings, Inc.
1160 Dairy Ashford Rd., Suite 160
Houston, Texas 77079
Attention: Investor Relations
Telephone: (281) 258-4409
Email: rabney@saexploration.com
3,083,359 Shares
Common Stock, $0.0001 par value
PROSPECTUS
______________, 2016
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
Distribution.The following table sets forth the estimated expenses (other than underwriting discounts and commissions), all(all of which will be paid by us,are estimated) to be incurredborne by us in connection with the registration and salea distribution of the shares of common stock that are the subject ofsecurities registered under this registration statement:
|
| | | |
| Securities and Exchange Commission registration fee | $ | 3,815.97 |
|
| Legal fees and expenses | $ | 25,000.00 |
|
| Accounting fees and expenses | $ | 5,000.00 |
|
| Printing and distribution fees | $ | 8,000.00 |
|
| Miscellaneous | $ | 0.00 |
|
| | |
| Total | $ | 41,815.97 |
|
Registration Statement. | | | | |
SEC registration fee | | $ | 8,110.00 | |
Accounting fees and expenses | | $ | 5,000.00 | |
Legal fees and expenses | | $ | 25,000.00 | |
Printing fees and expenses | | $ | 10,000.00 | |
Transfer Agent fees and expenses | | $ | 0.00 | |
Miscellaneous | | $ | 0.00 | |
| | | | |
Total | | $ | 48,110.00 | |
Item 15. Indemnification of Directors and Officers
Officers.Our Second Amended and Restated Certificate of Incorporation as amended by our Certificate of Amendment to SecondThird Amended and Restated Certificate of Incorporation (the “Existing Charter”“Charter”) contains provisions eliminating the personal liability of our directors to us and our stockholders for monetary damages for breaches of their fiduciary duties as directors to the fullest extent permitted by Section 145 of the General Corporation Law of the State of DelawareDGCL or any other applicable law as it exists on the date of the Existing Charter. The General Corporation Law of the State of DelawareDGCL prohibits such elimination of personal liability of a director for:
• any breach of the director’s duty of loyalty to us or our stockholders;
• acts or omissions not in good faith or involving intentional misconduct or a knowing violation of law;
• the payment of dividends, stock repurchases or redemptions that are unlawful under Delaware law; and
• any transaction in which the director receives an improper personal benefit.
These provisions only apply to breaches of duty by directors as directors and not in any other corporate capacity, such as officers. In addition, these provisions limit liability only for breaches of fiduciary duties under the General Corporation Law of the State of DelawareDGCL and not for violations of other laws such as the U.S. federal securities laws and U.S. federal and state environmental laws. As a result of these provisions in the Existing Charter, our stockholders may be unable to recover monetary damages against directors for actions taken by them that constitute negligence or gross negligence or that are in violation of their fiduciary duties. However, our stockholders may obtain injunctive or other equitable relief for these actions. These provisions also reduce the likelihood of derivative litigation against directors that might benefit us.
The ExistingAdditionally, the Charter contains a short indemnification provision stating that indemnification will be provided to each of our directors and officers (each, an “indemnitee”) the full extent permitted by the law. Further, the Existing Charter provides that we are required to indemnify, or advance expenses to, an indemnitee in connection with a proceeding (or part thereof) commenced by such indemnitee only if the commencement of such proceeding (or part thereof) by the indemnitee was authorized by our board of directors.
We expect that our Third Amended and Restated Certificate of Incorporation (the “New Charter”) will become effective when it is filed with the Secretary of State of the State of Delaware on or around September 6, 2016. The New Charter broadens the indemnification provided to a Covered Person (as defined in the New Charter) to expressly provide: (i) indemnification to Covered Persons to the
maximumfullest extent permitted by applicable law, against all liability and losses suffered and expenses (including
attorney’sattorneys’ fees) reasonably incurred by such Covered Person
(as defined in the Charter) who is made a party to any Proceeding (as defined in the
New Charter) by reason of the fact that he or she, or a person for whom he or she is our legal representative, is or was
aour director or, while
aour director or officer, is or was serving at our request as a director, officer, employee or agent of another entity or enterprise, including service with respect to employee benefit plans; (ii) the prepayment of expenses (including
attorney’sattorneys’ fees) to the extent not prohibited by applicable law; (iii) that if a claim for indemnification or advancement of expenses is not paid in full within 30 days
after we receive a written claim from the Covered Person, the Covered Person may file to suit to recover the unpaid amount
of such claim and, if successful in whole or in part, will be entitled to be paid the expense of prosecuting such claim; (iv) that the rights provided in the indemnification provision are not exclusive; and (v) that we are the indemnitor of first resort and, if any third party pays or causes to be paid the indemnifiable amounts, then the third party shall be fully subrogated to all rights of the Covered Person with respect to such payment, and we will fully indemnify, reimburse, and hold harmless such third party for all such payments actually made by the third party.
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The New Charter also specifies that any amendment or repeal of this provision will not adversely affect any right or protection in respect of any act or omission occurring prior to the time of the amendment or repeal. Finally, we may also advance expenses and indemnity persons other than Covered Persons to the extent permitted by applicable law.
On July 27, 2016, we entered into indemnification agreements (the “New Indemnification Agreements”) with Jeff Hastings, Brian Beatty, Brent Whiteley, Mike Scott, Darin Silvernagle, Ryan Abney, Gary Dalton, L. Melvin Cooper, Michael Kass, and Jacob Mercer (each, an “Indemnitee”). The New Indemnification Agreements supersede and replace the indemnification agreements previously entered into with any such individuals. The New Indemnification Agreements are intended to provide indemnification rights for actions or omissions to act while the Indemnitees are or were acting as our directors, officers, employees or agents (among certain other limited roles). In connection therewith, we will indemnify (except in certain limited circumstances) the Indemnitees against, among other things, all expenses (including attorneys’ fees), damages, losses, liabilities, judgments, fines, penalties (whether civil, criminal or other), Employee Retirement Income Security Act of 1974 losses and amounts paid in settlement pursuant to (i) any threatened, asserted, pending or completed claim, demand, action, suit or proceeding, whether civil, criminal, administrative, arbitrative, investigative or other, and whether made pursuant to federal, state or other law, and (ii) any threatened, pending or completed inquiry or investigation, whether made, instituted or conducted by us or at our request or any other person, including any federal, state or other court or governmental entity or agency and any committee or other representative of any corporate constituency, to the fullest extent permitted by applicable law. In addition, the New Indemnification Agreements provide for the advancement of expenses incurred by the Indemnitees in connection with any proceeding covered by the New Indemnification Agreements, provided that the Indemnitees must repay the advanced amounts if, upon conclusion of the proceeding, it is ultimately determined that the Indemnitees were not entitled to indemnification.
In connection with the closing of the Merger, we entered into indemnification agreements (the “Prior Indemnification Agreements”) with each of our directors and certain of our officers, all of which have been replaced with the New Indemnification Agreements, except those executed with Eric Rosenfeld, David Sgro, and Gregory Monahan, our directors who resigned in connection with the Restructuring (each, a “Contractual Indemnitee”). Pursuant to the Prior Indemnification Agreements, we will be obligated to indemnify the applicable Contractual Indemnitee to the fullest extent permitted by applicable law in the event that such Contractual Indemnitee, by reason of such Contractual Indemnitee’s relationship with us, was, is or is threatened to be made a party to or participant in
any threatened, pending or completed action or proceeding, other than an action or proceeding by or in our right, against all expenses, judgments, penalties, fines (including any excise taxes assessed on the Contractual Indemnitee with respect to an employee benefit plan) and amounts paid in settlement actually and reasonably incurred by such Contractual Indemnitee in connection with such action or proceeding, provided that such Contractual Indemnitee acted in good faith and in a manner he reasonably believed to be in or not opposed to our best interests and, with respect to any criminal action or proceeding, provided that he also had no reasonable cause to believe his conduct was unlawful. We will also be obligated to indemnify such Contractual Indemnitee to the fullest extent permitted by applicable law in the event that such Contractual Indemnitee, by reason of such Contractual Indemnitee’s relationship with us, was, is or is threatened to be made a party to or participant in any threatened, pending or completed action or proceeding brought by or in our right to procure a judgment in our favor, against all expenses actually and reasonably incurred by such Contractual Indemnitee in connection with such action or proceeding, provided that such Contractual Indemnitee acted in good faith and in a manner he reasonably believed to be in or not opposed to our best interests. Notwithstanding the foregoing sentence, no indemnification against expenses incurred by such Contractual Indemnitee in connection with such an action or proceeding brought by or in our right will be made in respect of any claim, issue or matter as to which such Contractual Indemnitee is adjudged to be liable to us or if applicable law prohibits such indemnification being made; provided, however, that, in such event, if applicable law so permits, indemnification against such expenses will nevertheless be made by us if and to the extent that the court in which such action or proceeding has been brought or is pending determines that, despite the adjudication of liability but in view of all the circumstances of the case, the Contractual Indemnitee is fairly and reasonably entitled to indemnity for such expenses.
The Prior Indemnification Agreements also provide for the advancement of all reasonable expenses incurred by such Contractual Indemnitee in connection with any action or proceeding covered by the Prior Indemnification Agreement. The Contractual Indemnitee will be required to repay any amounts so advanced if, and to the extent that, it is ultimately determined that he is not entitled to be indemnified by us against such expenses. The Contractual Indemnitee will further be required to return any such advance to us which remains unspent at the conclusion of the action or proceeding to which the advance related.
In addition, the Prior Indemnification Agreements provide that we will use all commercially reasonable efforts to obtain and maintain in effect for so long as the Contractual Indemnitee may have any liability or potential liability by reason of his relationship with us, one or more insurance policies providing our directors and officers coverage for losses from wrongful acts and omissions and to ensure our performance of our indemnification obligations under each Prior Indemnification Agreement.
There is no pending litigation or proceeding involving any of our directors, officers, employees or other agents as to which indemnification is being sought, nor are we aware of any pending or threatened litigation that may result in claims for indemnification by any director, officer, employee or other agent.
Item 16. ExhibitsExhibits.
| | |
Exhibit
Number | |
Description
|
| |
| 2.1** | | Restructuring Support Agreement dated as of June 13, 2016, among the Company, the members of management identified therein and the supporting holders identified therein (filed as Exhibit 10.1 to the Company’s Current Report on Form8-K on June 13, 2013, and incorporated herein by reference). |
| |
| 2.2** | | Restructuring Support Agreement, dated as of December 19, 2017, by and among SAExploration Holdings, Inc., certain subsidiaries of SAExploration Holdings, Inc., the members of management identified therein and the supporting holders identified therein (filed as Exhibit 10.1 to the Company’s Current Report on December 20, 2017, and incorporated herein by reference). |
| |
| 2.3** | | Asset Purchase Agreement dated as of June 26, 2018 by and among Geokinetics Inc., Geokinetics Holdings USA, Inc., Geokinetics Processing, Inc., Geokinetics USA, Inc., Advanced Seismic Technology, Inc., Geokinetics International Holdings, Inc., Geokinetics International, Inc., Geokinetics (Australia) PTY Ltd., Geokinetics Exploration, Inc. and SAExploration, Inc. (incorporated by reference from Exhibit 2.1 to SAExploration Holdings, Inc. Current Report on Form 8–K filed with the SEC on July 2, 2018). |
| |
| 2.4** | | Amendment No. 1, dated as of July 25, 2018, to Asset Purchase Agreement dated as of June 26, 2018 by and among Geokinetics Inc., Geokinetics Holdings USA, Inc., Geokinetics Processing, Inc., Geokinetics USA, Inc., Advanced Seismic Technology, Inc., Geokinetics International Holdings, Inc., Geokinetics International, Inc., Geokinetics (Australia) PTY Ltd., Geokinetics Exploration, Inc. and SAExploration Acquisitions (U.S.), LLC. (incorporated by reference from Exhibit 2.1 to SAExploration Holdings, Inc. Current Report on Form 8–K filed with the SEC on July 30, 2018). |
| |
| 3.1 | | Third Amended and Restated Certificate of Incorporation dated September 6, 2016 (filed as Exhibit 3.1 to the Company’s Current Report on Form8-K/A on September 9, 2016, and incorporated herein by reference). |
| |
| 3.2 | | Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation dated March 5, 2018 (filed as Exhibit 3.1 to the Company’s Current Report on Form8-K on March 8, 2018, and incorporated herein by reference). |
| |
| 3.3 | | Second Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation of SAExploration Holdings, Inc, dated September 13, 2018 (filed as Exhibit 3.1 to the Company’s Current Report on Form8-K on September 19, 2018, and incorporated herein by reference). |
| |
| 3.4 | | Third Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation of SAExploration Holdings, Inc., dated September 13, 2018 (filed as Exhibit 3.2 to the Company’s Current Report on Form8-K on September 19, 2018, and incorporated herein by reference). |
| |
| 3.5 | | Fourth Certificate of Amendment to the Third Amended and Restated Certificate of Incorporation of SAExploration Holdings, Inc., dated November 26, 2018 (filed as Exhibit 3.1 to the Company’s Current Report on Form8-K on November 29, 2018, and incorporated herein by reference). |
| |
| 3.6 | | Second Amended and RestatedBy-Laws (filed as Exhibit 3.2 to the Company’s Current Report on Form8-K on August 1, 2018, and incorporated herein by reference). |
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Reference is hereby made to the attached Exhibit Index, which is incorporated herein by reference. | | |
Exhibit
Number | |
Description
|
| |
| 3.7 | | Amendment No. 1 to Second Amended and RestatedBy-Laws (filed as Exhibit 3.2 to the Company’s Current Report on Form 8–K on March 8, 2018, and incorporated herein by reference). |
| |
| 4.1 | | Specimen Stock Certificate (incorporated herein by reference to the Company’s Form8-K filed on June 26, 2013 (FileNo. 001-35471)). |
| |
| 4.2 | | Indenture, dated July 27, 2016, by and among the Corporation, the guarantors named therein and Wilmington Savings Fund Society, FSB, as trustee and noteholder collateral agent (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K on August 1, 2016, and incorporated herein by reference). |
| |
| 4.3 | | First Supplemental Indenture, dated January 26, 2018, to Indenture, dated July 27, 2016, by and among the Corporation, the guarantors named therein and Wilmington Savings Fund Society, FSB, as trustee and noteholder collateral agent (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K on February 1, 2018, and incorporated herein by reference). |
| |
| 4.4 | | Indenture, dated as of September 26, 2018, between SAExploration Holdings, Inc., the Guarantors from time to time party thereto and Wilmington Savings Fund Society, FSB, as Trustee and Collateral Trustee (filed as Exhibit.4.1 to the Company’s Current Report on Form8-K on October 2, 2018, and incorporated herein by reference). |
| |
| 4.5 | | Form of 6.00% Senior Secured Convertible Note due 2023 of SAExploration Holdings, Inc. (filed as Exhibit A to Exhibit 4.4 to this Registration Statement on FormS-3). |
| |
| 4.6 | | Warrant Agreement, dated as of January 29, 2018, between the Company and Continental Stock Transfer & Trust Company, as Warrant Agent (filed as Exhibit 10.2 to the Company’s Current Report on Form8-K on February 1, 2018, and incorporated herein by reference). |
| |
| 4.7 | | Form of Series C Warrant (filed as Exhibit A to Exhibit 4.5 to this Registration Statement on FormS-3). |
| |
| 4.8 | | Warrant Agreement, dated as of March 8, 2018, between the Company and Continental Stock Transfer & Trust Company, as Warrant Agent (filed as Exhibit 10.1 to the Company’s Current Report on Form8-K on March 3, 2018, and incorporated herein by reference). |
| |
| 4.9 | | Form of Series D Warrant (filed as Exhibit A to Exhibit 4.8 to this Registration Statement on FormS-3). |
| |
| 4.10 | | Warrant Agreement, dated as of September 6, 2018, between SAExploration Holdings, Inc. and Continental Stock Transfer & Trust Company, as Warrant Agent (filed as Exhibit 4.1 to the Company’s Current Report on Form8-K on September 11, 2018, and incorporated herein by reference). |
| |
| 4.11 | | Registration Rights Agreement dated July 27, 2016, between the Company and the holders named therein (filed as Exhibit 10.2 to the Company’s Current Report on Form8-K on August 1, 2016, and incorporated herein by reference). |
| |
| 4.12 | | First Amendment dated as of August 25, 2016 to Registration Rights Agreement dated July 27, 2016, between the Company and the holders named therein (filed as Exhibit 10.1 to the Company’s Current Report on Form8-K on August 25, 2016, and incorporated herein by reference). |
| |
| 4.13 | | Registration Rights Agreement, dated January 29, 2018, by and among the Company and the holders named therein (filed as Exhibit 10.1 to the Company’s Current Report on Form8-K on February 1, 2018, and incorporated herein by reference). |
| |
| 4.14 | | Registration Rights Agreement, dated September 26, 2018, by and among the Company and the holders named therein (filed as Exhibit 10.2 to the Company’s Current Report on Form8-K on October 2, 2018, and incorporated herein by reference). |
| |
| 5.1* | | Opinion of General Counsel as to the legality of the securities being registered. |
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| ** | The exhibits and schedules to this agreement have been omitted form this filing pursuant to Item 601(b)(2) of Regulation S-K. The Company will furnish copies of such omitted exhibits and schedules to the SEC upon request. |
Item 17. Undertakings
(a) Undertakings.The undersigned registrant hereby undertakes:
(1)1. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
provided, | (i) | to include any prospectus required by Section 10(a)(3) of the Securities Act; |
| (ii) | to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; |
| (iii) | to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; |
Provided, however, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) do not apply if the registration statement is on Form S-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrantRegistrant pursuant to sectionSection 13 or sectionSection 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
(2)2. That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3)3. To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4)4. That, for the purpose of determining liability under the Securities Act to any purchaser:
(i) If the registrant is relying on Rule 430B:
(A) Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
(B)(ii) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i),
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(vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which thethat prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration
statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.
(ii) If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
(5)5. That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer andor sell such securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(ii) Anyany free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii) Thethe portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv) Anyany other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
(b)6. The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to sectionSection 13(a) or section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to sectionSection 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c)7. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions or otherwise, the registrant has been advised that in the opinion of the SECSecurities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act, and will be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on FormS-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Houston, State of Texas, on August 30, 2016.
|
| | | |
| SAEXPLORATION HOLDINGS, INC. |
| | |
| |
| By: | | By: | /s/ Brent Whiteley |
| | |
| Name: | | Name: Brent Whiteley
|
| | |
| Title: | | Chief Financial Officer, General Counsel and Secretary |
KNOW ALL PERSONS BY THESE PRESENTS, that each of the undersigned officers and directors of SAExploration Holdings, Inc. hereby severally constitute and appoint Jeff HastingsBrent Whiteley and Brent WhiteleyRyan Abney and each of them,attorneys-in-fact for the undersigned, in any and all capacities, with the power of substitution, to sign any amendments to this registration statementRegistration Statement (including post-effective amendments) and any subsequent registration statement for the same offering which may be filed under Rule 462(e)462(b) under the Securities Act of 1933, as amended, and to file the same with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto saidattorneys-in-fact, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully and to all interestsintents and purposes as he or she might or could do in person, hereby ratifying and confirming all that each saidattorney-in-fact, or his or her substitute or substitutes, may do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statementRegistration Statement has been signed by the following persons in the capacities and on the dates indicated.
indicated: |
| | | | |
SIGNATURE | | TITLE | | DATE |
| | | | |
/s/ Jeff Hastings Jeff Hastings | | Chief Executive Officer and Chairman of the Board (Principal (Principal Executive Officer)
| | August 30, 2016December 10, 2018 |
Jeff Hastings | | |
| | | | |
/s/ Brian A. Beatty Brian Beatty | | Chief Operating Officer and Director | | August 30, 2016December 10, 2018 |
Brian A. Beatty | | |
| | | | |
/s/ Brent Whiteley Brent Whiteley | | Chief Financial Officer, General Counsel, and Secretary ( (Principal Financial Officer and Principal FinancialAccounting Officer)
| | August 30, 2016December 10, 2018 |
Brent Whiteley | | |
| | | | |
/s/ Trisha M. Gerber | | Chief Accounting Officer
(Principal Accounting Officer)
| | August 30, 2016 |
Trisha M. Gerber | | |
| | | | |
/s/ L. Melvin Cooper L. Melvin Cooper | | Director | | August 30, 2016December 10, 2018 |
L. Melvin Cooper | | |
| | | | |
/s/ Gary Dalton Gary Dalton | | Director | | August 30, 2016December 10, 2018 |
Gary Dalton | | |
| | | | |
/s/ Michael KassFaust Michael Faust | | Director | | August 30, 2016December 10, 2018 |
Michael Kass | | |
| | | | |
/s/ Jacob MercerAlan B. Menkes Alan B. Menkes | | Director | | August 30, 2016 |
Jacob Mercer | | |
EXHIBIT INDEX
| December 10, 2018 |
| | | | | | | | |
Exhibit No./s/ Jacob Mercer Jacob Mercer | | Description | | Included | | Form | | Filing Date |
| | | | | | | | |
2.1 | | Agreement and Plan of Reorganization dated as of December 10, 2012, by and among the SAExploration Holdings, Inc. formerly named Trio Merger Corp. (the “Registrant”), Trio Merger Sub, Inc., the entity formerly named SAExploration Holdings, Inc. (“Former SAE”) and CLCH, LLC | | By Reference | | 8-KDirector | | December 11, 2012 |
2.2 | | First Amendment to Agreement and Plan of Reorganization dated as of May 23, 2013, by and among the Registrant, Trio Merger Sub, Inc., Former SAE and CLCH, LLC | | By Reference | | 8-K | | May 28, 2013 |
2.3 | | Restructuring Support Agreement, dated as of June 13, 2016, among SAExploration Holdings, Inc., the members of management identified therein and the supporting holders identified therein | | By Reference | | 8-K | | June 13, 2016 |
3.1 | | Second Amended and Restated Certificate of Incorporation | | By Reference | | 8-K | | June 28, 2013 |
3.2 | | Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation | | By Reference | | 8-K | | August 1, 2016 |
3.3 | | Third Amended and Restated Certificate of Incorporation1
| | By Reference | | 14-C | | August 17, 2016 |
3.4 | | Second Amended and Restated By-Laws | | By Reference | | 8-K | | August 1, 2016 |
4.1 | | Specimen Common Stock Certificate | | By Reference | | 8-K | | June 28, 2013 |
4.2 | | Indenture, dated July 2, 2014, by and among the
Company, the guarantors named therein and U.S.
Bank National Association, as trustee and
noteholder collateral agent | | By Reference | | 8-K | | July 9, 2014 |
4.3 | | 10.000% Senior Secured Notes due 2019 dated
June 19, 2015 | | By Reference | | 10-Q | | August 7, 2015 |
4.4 | | Notation of Guarantee executed June 19, 2015,
among the Company, SAExploration Sub, Inc.,
SAExploration, Inc., SAExploration Seismic
Services (US), LLC, and NES, LLC | | By Reference | | 10-Q | | August 7, 2015 |
4.5 | | First Supplemental Indenture, dated as of June 29, 2016, among SAExploration Holdings, Inc., the guarantors party thereto, and Wilmington Savings Fund Society, FSB, as trustee and noteholder collateral agent | | By Reference | | 8-K | | July 1, 2016 |
4.6 | | Indenture, dated July 27, 2016, by and among the
Company, the guarantors named therein and
Wilmington Savings Fund Society, FSB, as
trustee and noteholder collateral agent | | By Reference | | 8-K | | August 1, 2016 |
4.7 | | Form of 10.000% Senior Secured Second Lien
Notes due 2019 | | By Reference | | 8-K | | August 1, 2016 |
4.8 | | Notation of Guarantee executed July 27, 2016,
among SAExploration Sub, Inc.,
SAExploration, Inc., SAExploration Seismic
Services (US), LLC and NES, LLC | | By Reference | | 8-K | | August 1, 2016 |
4.9 | | Warrant Agreement, dated as of July 27, 2016 between the Company and Continental Stock Transfer & Trust Company, as Warrant Agent | | By Reference | | 8-K | | August 1, 201610, 2018 |
|
| | | | | | | | |
4.10 | | Form of Series A Warrant (included in Exhibit 4.9 | | By Reference | | 8-K | | August 1, 2016 |
4.11 | | Form of Series B Warrant (included in Exhibit 4.9) | | By Reference | | 8-K | | August 1, 2016 |
4.12 | | Registration Rights Agreement dated June 24, 2013, by and between the Registrant and CLCH, LLC | | By Reference | | 8-K | | June 28, 2013 |
4.13 | | Registration Rights Agreement dated July 27, 2016, between the Company and the holders named therein | | By Reference | | 8-K | | August 1, 2016 |
4.14 | | First Amendment dated as of August 25, 2016 to Registration Rights Agreement dated July 27, 2016, between the Company and the holders named therein | | By Reference | | 8-K | | August 25, 2016 |
10.1 | | Term Loan and Security Agreement, dated as of June 29, 2016, by and among SAExploration Holdings, Inc., as borrower, the guarantors named therein, as guarantors, the lenders, from time to time party thereto, as lenders and Delaware Trust Company, as collateral agent and administrative agent | | By Reference | | 8-K | | July 1, 2016 |
10.2 | | Amended and Restated Intercreditor Agreement, dated as of June 29, 2016, by and among Wells Fargo Bank, National Association, as lender and collateral agent, Wilmington Savings Fund Society, FSB, as trustee and collateral agent, Delaware Trust Company, as administrative agent and collateral agent and, upon execution of an additional indebtedness joinder and designation, the additional noteholder agent. | | By Reference | | 8-K | | July 1, 2016 |
10.3 | | Additional Indebtedness Joinder and Designation,
dated as of July 27, 2016, by and among Wells
Fargo Bank, National Association, as ABL Agent,
Wilmington Savings Fund Society, FSB, as
Existing Noteholder Agent, Delaware Trust
Company, as Term Agent, and Wilmington
Savings Fund Society, FSB, as Additional
Noteholder Agent | | By Reference | | 8-K | | August 1, 2016 |
5.1 | | Opinion of Strasburger & Price, LLP | | Herewith | | | | |
23.1 | | Consent of Pannell Kerr Forster of Texas, P.C | | Herewith | | | | |
23.2 | | Consent of Strasburger & Price, LLP (included in Exhibit 5.1) | | Herewith | | | | |
24.1 | | Power of Attorney (set forth on the signature page hereof) | | Herewith | | | | |
1 Not effective until executed and filed with the Secretary of State of the State of Delaware, which is expected to occur on or around September 6, 2016. The Third Amended and Restated Certificate of Incorporation has been approved by our board of directors and stockholders.
