- Current report filing (8-K)
October 05 2010 - 5:04AM
Edgar (US Regulatory)
8-K
CURRENT REPORT OF MATERIAL EVENTS OR CORPORATE CHANGES
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report
October 4, 2010
(Date of earliest event
reported:
September 30, 2010
)
GEOKINETICS
INC.
(Exact name of registrant as specified in its charter)
Delaware
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001-33460
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94-1690082
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(State or other jurisdiction of
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(Commission File Number)
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(I.R.S. Employer
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incorporation or organization)
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Identification Number)
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1500 CityWest Blvd., Suite 800
Houston, Texas, 77042
(Address of principal executive offices)
(713) 850-7600
(Registrants telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
o
Written communications pursuant to Rule 425
under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12
under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to
Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to
Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
SECTION 1 Registrants Business and Operations
Item 1.01. Entry into a Material Definitive Agreement.
On
September 30, 2010, Geokinetics Holdings USA, Inc. (Geokinetics
Holdings), a wholly-owned subsidiary of Geokinetics Inc. (Geokinetics and
collectively with Geokinetics Holdings, the Company), entered into Waiver and
Amendment No. 2 to the Credit Agreement (the Amendment No. 2) to
amend that certain Credit Agreement, dated as of February 12, 2010, (as
amended by Amendment No. 1 to the Credit Agreement dated as of June 30,
2010) (the Credit Agreement), by and among Geokinetics Holdings, Royal Bank
of Canada, as administrative and collateral agent, and the financial
institutions and other institutional lenders party thereto (collectively, the
Lenders
).
Amendment No. 2 provides a waiver of specific events of default for
the quarter ended September 30, 2010 and also defines certain financial
covenants commencing with the month ending September 30, 2010 through the
month ending November 30, 2010.
The
Lenders agreed to waive specified events of default that would have occurred on
September 30, 2010 resulting from the failure by the Company to comply
with the requirements of minimum total leverage ratio, minimum interest
coverage ratio and fixed charge coverage ratio as defined in Section 7.13,
7.14 and 7.15 of Amendment No. 1, respectively.
Amendment
No.2 defines newly imposed financial covenants including monthly minimum total
revenues and consolidated cumulative adjusted EBITDA. While the Company believes it will remain in
compliance with these covenants, at least through November 30, 2010,
revenues and consolidated cumulative adjusted EBITDA amounts do not represent
earnings guidance provided by the Company and should not be used as such. The amounts were negotiated with the Lender
for the sole purpose of defining events of default and may not be indicative of
future results. Minimum total revenues per month must total $50 million, $60
million, and $60 million for the months ended September 30, October 31,
and November 30, 2010, respectively.
Monthly minimum consolidated cumulative adjusted EBITDA must total $7.9
million, $17.6 million, and $30.1 million for the period beginning on September 1,
2010 until and including September 30, October 31, and November 30,
2010, respectively. Actual results may
differ from these results, and these differences may be material. To evidence
compliance with new and existing covenants, the Company will be required to
provide unaudited financial information, along with an executed certification
of compliance on a monthly basis, no later than 15 business days after the end
of the period.
The
permitted outstanding borrowing amount under the revolver remains unchanged at
$40 million, of which $26 million was outstanding as of September 30,
2010. Financial covenants defined in the
original Credit Agreement have not been amended for the December 31, 2010
measurement date and beyond. Also, new financial covenant minimums have not
been defined for periods beyond the month ended November 30, 2010. The
Company continues to evaluate its borrowing needs and remains in discussions
with its lenders about potential solutions to address the likelihood of
non-compliance in future periods.
The
foregoing description is a summary of the material terms of Amendment No. 2
and does not purport to be complete, and is qualified in its entirety by reference
to the Amendment No. 2, a copy of which is attached to this Current Report
on Form 8-K as Exhibit 10.1.
SECTION 7 Regulation FD
Item 7.01. Regulation FD Disclosure.
On
October 4, 2010, Geokinetics issued a press release announcing the Amendment
No.2. A copy of the press release is furnished as Exhibit 99.1 and is
incorporated herein by reference.
On
October 4, 2010, Geokinetics announced that Richard F. Miles, President
and Chief Executive Officer, will host a breakfast table at the Johnson Rice &
Company 2
nd
Annual Energy Conference in New Orleans, LA on
Tuesday, October 5, 2010 at 8:00 a.m. EDT. A copy of the presentation is attached hereto
as exhibit 99.2 and will be available on the Geokinetics website at
http://www.geokinetics.com on the day of the breakfast.
In
accordance with General Instruction B.2 of Form 8-K, the information set
forth in the attached Exhibits 99.1and 99.2 is deemed to be furnished
and shall not be deemed to be filed for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended.
Section 9 Financial Statements and Exhibits
Item 9.01 Financial Statements and Exhibits.
(d)
Exhibits.
Exhibit Number
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Title of Document
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10.1
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Amendment
No. 2 to the Credit Agreement, dated as of September 30, 2010, by
and among Geokinetics Holdings and Royal Bank of Canada as administrative and
collateral agent to the certain lenders named therein
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99.1
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Press
release dated October 4, 2010
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99.2
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Presentation
for Johnson Rice & Company 2
nd
Annual Energy Conference dated
October 5, 2010
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2
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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GEOKINETICS INC.
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October 4,
2010
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By:
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/s/
William L. Moll, Jr.
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William L. Moll, Jr., Vice President, General
Counsel and Corporate Secretary
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3
Exhibit Index
Exhibit Number
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Title of Document
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10.1
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Amendment
No. 2 to the Credit Agreement, dated as of September 30, 2010, by
and among Geokinetics Holdings and Royal Bank of Canada as administrative and
collateral agent to the certain lenders named therein
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99.1
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Press
release dated October 4, 2010
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99.2
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Presentation
for Johnson Rice & Company 2
nd
Annual Energy Conference dated
October 5, 2010
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4
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