Document:

Exhibit 4(b)

	

EXHIBIT
4(b)  

AMENDED AND RESTATED BY
- LAWS* 

OF 

IMPATH INC. 

ARTICLE I 

OFFICES 

     Section 1. The registered
office shall be in the City of Wilmington, County of New Castle, State of
Delaware. 

     Section 2. The corporation
may also have offices at such other places both within and without the State of
Delaware as the board of directors may from time to time determine or the
business of the corporation may require. 

ARTICLE II 

MEETINGS OF STOCKHOLDERS 

     Section 1. All meetings of
the stockholders for the election of directors shall be held at such place
either within or without the State of Delaware as shall be designated from time
to time by the board of directors and stated in the notice of the meeting.
Meetings of stockholders for any other purpose may be held at such time and
place, within or without the State of Delaware, as shall be stated in the notice
of the meeting or in a duly executed waiver of notice thereof. 

     Section 2. Annual meetings
of stockholders shall be held on such date and at such time as shall be
designated from time to time by the board of directors and stated in the notice
of the meeting, at which, unless otherwise provided in the Certificate of
Incorporation, they shall elect by a plurality vote a board of directors, and
transact such other business as may properly be brought before the meeting. 

	*		As
amended as of April 16, 2002. 

	

 

	

     Section 3. Written notice
of the annual meeting stating the place, date and hour of the meeting shall be
given to each stockholder entitled to vote at such meeting not less than ten nor
more than sixty days before the date of the meeting. 

     Section 4. The officer who
has charge of the stock ledger of the corporation shall prepare and make, at
least ten days before every meeting of stockholders, a complete list of the
stockholders entitled to vote at the meeting, arranged in alphabetical order,
and showing the address of each stockholder and the number of shares registered
in the name of each stockholder. Such list shall be open to the examination of
any stockholder, for any purpose germane to the meeting, during ordinary
business hours for a period of at least ten days prior to the meeting, either at
a place within the city where the meeting is to be held, which place shall be
specified in the notice of the meeting, or, if not so specified, at the place
where the meeting is to be held. The list shall also be produced and kept at the
time and place of the meeting during the whole time thereof, and may be
inspected by any stockholder who is present. 

     Section 5. Special meetings
of the stockholders, for any purpose or purposes, unless otherwise prescribed by
statute or by the Certificate of Incorporation, may be called by the chairman or
the president, and shall be called by the president or secretary at the request
in writing of a majority of the board of directors. 

     Section 6. Written notice
of a special meeting stating the place, date and hour of the meeting and the
purpose or purposes for which the meeting is called, shall be given not less
than ten nor more than sixty days before the date of the meeting, to each
stockholder entitled to vote at such meeting. 

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     Section 7. Business
transacted at any special meeting of stockholders shall be limited to the
purposes stated in the notice. 

     Section 8. The holders of a
majority of the capital stock issued and outstanding and entitled to vote
thereat, present in person or represented by proxy, shall constitute a quorum at
all meetings of the stockholders for the transaction of business except as
otherwise provided by statute or by the Certificate of Incorporation. If,
however, such quorum shall not be present or represented at any meeting of the
stockholders, the stockholders entitled to vote thereat, present in person or
represented by proxy, shall have power to adjourn the meeting from time to time,
without notice other than announcement at the meeting, until a quorum shall be
present or represented. At such adjourned meeting at which a quorum shall be
present or represented any business may be transacted which might have been
transacted at the meeting as originally notified. If the adjournment is for more
than thirty days, or if after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be given to each
stockholder of record entitled to vote at the meeting. 

     Section 9. When a quorum is
present at any meeting, the vote of the holders of a majority of the stock
having voting power present in person or represented by proxy shall decide any
question brought before such meeting, unless the question is one upon which by
express provision of the statutes or of the Certificate of Incorporation, a
different vote is required in which case such express provision shall govern and
control the decision of such question. 

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     Section 10. Unless
otherwise provided in the Certificate of Incorporation, each stockholder
represented at a meeting of the stockholders be entitled to one vote in person
or by proxy for each share of the capital stock having voting power held by such
stockholder, but no proxy shall be voted on after three years from its date,
unless the proxy provides for a longer period. 

NOTICE OF STOCKHOLDER
BUSINESS AND NOMINATIONS 

     Section 11. (a) Nominations
of persons for election to the board of directors and the proposal of other
business to be considered by the stockholders may be made at an annual meeting
of stockholders (A) pursuant to the corporation’s notice of meeting, (B) by
or at the direction of the board of directors or (C) by any stockholder of the
corporation who was a stockholder of record at the time of giving of notice
provided for in this by-law, who is entitled to vote at the meeting and who
complies with the notice procedures set forth in this by-law. 

     (b) For nominations or
other business to be properly brought before an annual meeting by a stockholder
pursuant to clause (C) of Section 11(a) of this by-law, the stockholder must
have given timely notice thereof in writing to the Secretary of the corporation
and such other business must otherwise be a proper matter for stockholder
action. To be timely, a stockholder’s notice shall be delivered to the
Secretary at the principal executive offices of the corporation not less than 90
days nor more than 120 days prior to the anniversary date of the immediately
preceding annual meeting of stockholders; provided, however, that in the event
that the annual meeting is called for on a date that is not within 30 days
before or after such anniversary date, notice by the stockholder in order to be
timely must be so received not later than the close of business on the 10th day
following the day on which such notice of the date of the annual meeting was
mailed or such public announcement of the date of the annual meeting was made,
whichever first occurs. In no event shall the public announcement of an
adjournment of an annual meeting commence a new time period for the giving of a
stockholder’s notice as described above. Such stockholder’s notice
shall set forth (A) as to each person whom the stockholder proposes to nominate
for election or re-election as a director all information relating to such
person that is required to be disclosed in solicitations of proxies for election
of directors in an election contest, or is otherwise required, in each case
pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”) and the rules promulgated thereunder (including
such person’s written consent to being named in the proxy statement as a
nominee and to serving as a director if elected); (B) as to any other business
that the stockholder proposes to bring before the meeting, a brief description
of the business desired to be brought before the meeting, the reasons for
conducting such business at the meeting and any material interest in such
business of such stockholder and the beneficial owner, if any, on whose behalf
the proposal is made; and (C) as to the stockholder giving the notice and the
beneficial owner, if any, on whose behalf the nomination or proposal is made (1)
the name and address of such stockholder, as they appear on the
corporation’s books, and of such beneficial owner and (2) the class and
number of shares of the corporation which are owned beneficially and of record
by such stockholder and such beneficial owner. 

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     (c) Notwithstanding
anything in the second sentence of paragraph (b) of this Section 11 to the
contrary, in the event that the number of directors to be elected to the board
of directors of the corporation is increased and there is no public announcement
by the corporation naming all of the nominees for director or specifying the
size of the increased board of directors at least 100 days prior to the first
anniversary of the preceding year’s annual meeting, a stockholder’s
notice required by this by-law shall also be considered timely, but only with
respect to nominees for any new positions created by such increase, if it shall
be delivered to the Secretary at the principal executive offices of the
corporation not later than the close of business on the 10th day following the
day on which such public announcement is first made by the corporation. 

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     (d) Only such business
shall be conducted at a special meeting of stockholders as shall have been
brought before the meeting pursuant to the corporation’s notice of meeting.
Nominations of persons for election to the board of directors may be made at a
special meeting of stockholders at which directors are to be elected pursuant to
the corporation’s notice of meeting (i) by or at the direction of the board
of directors or (ii) provided that the board of directors has determined that
directors shall be elected at such meeting, by any stockholder of the
corporation who is a stockholder of record at the time of giving of notice
provided for in this by-law, who shall be entitled to vote at the meeting and
who complies with the notice procedures set forth in this by-law. In the event
the corporation calls a special meeting of stockholders for the purpose of
electing one or more directors to the board of directors, any such stockholder
may nominate a person or persons (as the case may be), for election to such
position(s) as specified in the corporation’s notice of meeting, if the
stockholder’s notice required by paragraph (b) of this Section 11
shall be delivered to the Secretary at the principal executive offices of the
corporation not less than 90 days nor more than 120 days prior to the date of
such special meeting or the 10th day following the day on which public
announcement is first made of the date of the special meeting and of the
nominees proposed by the board of directors to be elected at such meeting. In no
event shall the public announcement of an adjournment of a special meeting
commence a new time period for the giving of a stockholder’s notice as
described above. 

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     (e) (1) Only such persons
who are nominated in accordance with the procedures set forth in this by-law
shall be eligible to serve as directors and only such business shall be
conducted at a meeting of stockholders as shall have been brought before the
meeting in accordance with the procedures set forth in this by-law. Except as
otherwise provided by law, the chairman of the meeting shall have the power and
duty to determine whether a nomination or any business proposed to be brought
before the meeting was made or proposed, as the case may be, in accordance with
the procedures set forth in this by-law and, if any proposed nomination or
business is not in compliance with this by-law, to declare that such defective
proposal or nomination shall be disregarded. 

          (2) For purposes of this
by-law, “public announcement” shall mean disclosure in a press release
reported by the Dow Jones News Service, Associated Press or comparable national
news-service or in a document publicly filed by the corporation with the
Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the
Exchange Act. 

          (3) Notwithstanding the
foregoing provisions of this by-law, a stockholder shall also comply with all
applicable requirements of the Exchange Act and the rules and regulations
thereunder with respect to the matters set forth in this by-law. Nothing in this
by-law shall be deemed to affect any rights (A) of stockholders to request
inclusion of proposals in the corporation’s proxy statement pursuant to
Rule 14a-8 under the Exchange Act or (B) of the holders of any series of
preferred stock of the corporation to elect directors under specified
circumstances. 

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ACTION BY WRITTEN
CONSENT 

     Section 12. Unless
otherwise provided in the Certificate of Incorporation, any action required or
permitted to be taken at any annual or special meeting of stockholders of the
corporation, or any action which may be taken at any annual or special meeting
of such stockholders, may be taken without a meeting, without prior notice and
without a vote, if a consent in writing, setting forth the action so taken,
shall be signed by the holders of outstanding stock having not less than the
minimum number of votes that would be necessary to authorize or take such action
at a meeting at which all shares entitled to vote thereon were present and
voted. If the Certificate of Incorporation provides for action by consent by
less than unanimous written consent of all such stockholders, prompt notice of
the taking of the corporate action without a meeting by less than unanimous
written consent shall be given to those stockholders who have not consented in
writing. 

ARTICLE III 

DIRECTORS 

     Section 1. The number of
directors which shall constitute the whole board shall be no less than five. The
directors shall be elected at the annual meeting of the stockholders, except as
provided in the Certificate of Incorporation or in Section 2 of this Article,
and each director elected shall hold office until his successor is elected and
qualified. Directors need not be stockholders. 

     Section 2. Except as
otherwise provided in the Certificate of Incorporation, vacancies and newly
created directorships resulting from any increase in the authorized number of
directors may be filled by a majority of the directors then in office, though
less than a quorum, or by a sole remaining director, and the directors so chosen
shall hold office until the next annual election and until their successors are
duly elected and shall qualify, unless sooner displaced. If there are no
directors in office, then an election of directors may be held in the manner
provided by statute. 

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     Section 3. The business of
the corporation shall be managed by or under the direction of its board of
directors which may exercise all such powers of the corporation and do all such
lawful acts and things as are not by statute or by the Certificate of
Incorporation or by these by-laws directed or required to be exercised or done
by the stockholders. 

MEETINGS OF THE BOARD
OF DIRECTORS 

     Section 4. The board of
directors of the corporation may hold meetings, both regular and special, either
within or without the State of Delaware. 

     Section 5. The first
meeting of each newly elected board of directors shall be held at such time and
place as shall be fixed by the vote of the stockholders at the annual meeting
and no notice of such meeting shall be necessary to the newly elected directors
in order legally to constitute the meeting, provided a quorum shall be present.
In the event of the failure of the stockholders to fix the time or place of such
first meeting of the newly elected board of directors, or in the event such
meeting is not held at the time and place so fixed by the stockholders, the
meeting may be held at such time and place as shall be specified in a notice
given as hereinafter provided for special meetings of the board of directors, or
as shall be specified in a written waiver signed by all of the directors. 

     Section 6. Regular meeting
of the board of directors may be held without notice at such time and at such
place as shall from time to time be determined by the board. 

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     Section 7. Special meetings
of the board may be called by the chairman or president on one day’s notice
to each director, either personally or by mail or by facsimile and shall be
called by the president or secretary in like manner and on like notice on the
written request of a majority of the board of directors. 

     Section 8. At all meetings
of the board a majority of directors then in office shall constitute a quorum
for the transaction of business and the act of a majority of the directors
present at any meeting at which there is a quorum shall be the act of the board
of directors, except as may be otherwise specifically provided by statute or by
the Certificate of Incorporation. If a quorum shall not be present at any
meeting of the board of directors, the directors present thereat may adjourn the
meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present. 

     Section 9. Unless otherwise
restricted by the Certificate of Incorporation or these by-laws, any action
required or permitted to be taken at any meeting of the board of directors or of
any committee thereof may be taken without a meeting if all members of the board
or committee, as the case may be, consent thereto in writing, and the writing or
writings are filed with the minutes of proceedings of the board or committee. 

     Section 10. Unless
otherwise restricted by the Certificate of Incorporation or these by-laws,
members of the board of directors, or any committee designated by the board of
directors, may participate in a meeting of the board of directors, or any
committee, by means of conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other,
and such participation in a meeting shall constitute presence in person at the
meeting. 

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COMMITTEES OF DIRECTORS 

     Section 11. The board of
directors may, by resolution passed by a majority of the whole board, designate
one or more committees, each committee to consist of one or more of the
directors of the corporation. The board may designate one or more directors as
alternate members of any committee, who may replace any absent or disqualified
member at any meeting of the committee. In the absence or disqualification of a
member of a committee, the member or members thereof present at any meeting and
not disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the board of directors to act at the
meeting in the place of any such absent or disqualified member. Any such
committee, to the extent provided in the resolution of the board of directors,
shall have and may exercise all the powers and authority of the board of
directors in the management of the business and affairs of the corporation, and
may authorize the seal of the corporation to be affixed to all papers which may
require it; but no such committee shall have the power or authority in reference
to amending the Certificate of Incorporation, adopting an agreement of merger or
consolidation, recommending to the stockholders the sale, lease or exchange of
all or substantially all of the corporation’s property and assets,
recommending to the stockholders a dissolution of the corporation or a
revocation of a dissolution, or amending the by-laws of the corporation; and,
unless the resolution or the Certificate of Incorporation expressly so provide,
no such committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock. Such committee or committees shall have such
name or names as may be determined from time to time by resolution adopted by
the board of directors. 

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     Section 12. Each committee
shall keep regular minutes of its meetings and report the same to the board of
directors when required. 

COMPENSATION OF
DIRECTORS 

     Section 13. Unless
otherwise restricted by the Certificate of Incorporation or these by-laws, the
board of directors shall have the authority to fix the compensation of
directors. The directors may be paid their expenses, if any, of attendance at
each meeting of the board of directors and may be paid a fixed sum for
attendance at each meeting of the board of directors or a stated salary as
director. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor. Members
of special or standing committees may be allowed like compensation for attending
committee meetings. 

INTERESTED DIRECTORS 

     Section 14. No contract or
transaction between the corporation and one or more of its directors or
officers, or between the corporation and any other corporation, partnership,
association, or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for this reason, or solely because the director or officer is
present at or participates in the meeting of the board of directors or committee
thereof which authorizes the contract or transaction, or solely because his or
their votes are counted for such purpose if (i) the material facts as to his or
their relationship or interest and as to the contract or transaction are
disclosed or are known to the board of directors or the committee, and the board
of directors or committee in good faith authorizes the contract or transaction
by the affirmative votes of a majority of the disinterested directors, even
though the disinterested directors be less than a quorum; or (ii) the material
facts as to his or their relationship or interest and as to the contract or
transaction are disclosed or are known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically approved in good
faith by vote of the stockholders’ or (iii) the contract or transaction is
fair as to the corporation as of the time it is authorized, approved or ratified
by the board of directors, a committee thereof or the stockholders. Common or
interested directors may be counted in determining the presence of a quorum at a
meeting of the board of directors or of a committee which authorizes the
contract or transaction. 

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REMOVAL OF DIRECTORS 

     Section 15. Unless
otherwise restricted by the Certificate of Incorporation or these by-laws, any
director or the entire board of directors may be removed, with cause, by the
holders of a majority of shares entitled to vote at an election of directors. 

ARTICLE IV 

NOTICES 

     Section 1. Whenever, under
the provisions of the statutes or of the Certificate of Incorporation or of
these by-laws, notice is required to be given to any director or stockholder, it
shall not be construed to mean personal notice, but such notice may be given in
writing, by mail, addressed to such director or stockholder, at his address as
it appears on the records of the corporation, with postage thereon prepaid, and
such notice shall be deemed to be given at the time when the same shall be
deposited in the United States mail. Notice to directors may also be given by
facsimile or by telephone, confirmed in writing. 

     Section 2. Whenever any
notice is required to be given under the provisions of the statutes or of the
Certificate of Incorporation or of these by-laws, a waiver thereof in writing,
signed by the person or persons entitled to said notice, whether before or after
the time stated therein, shall be deemed equivalent thereto. 

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ARTICLE V 

OFFICERS 

     Section 1. The officers of
the corporation shall be chosen by the board of directors and shall be a
president, a secretary and a treasurer. The board of directors may also choose a
chairman, a vice-chairman, a vice-president or vice-presidents, and one or more
assistant secretaries and assistant treasurers. Any number of offices may be
held by the same person, unless the Certificate of Incorporation or these
by-laws otherwise provide. 

     Section 2. The board of
directors it its first meeting after each annual meeting of stockholders shall
choose a president, a secretary and a treasurer. 

     Section 3. The board of
directors may appoint such other officers and agents as it shall deem necessary
who shall hold their offices for such terms and shall exercise such powers and
perform such duties as shall be determined from time to time by the board. 

     Section 4. The salaries of
all officers and agents of the corporation shall be fixed by the board of
directors. 

     Section 5. The officers of
the corporation shall hold office until their successors are chosen and qualify.
Any officer elected or appointed by the board of directors may be removed at any
time by the affirmative vote of a majority of the board of directors. Any
vacancy occurring in any office of the corporation shall be filled by the board
of directors. 

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THE CHAIRMAN OF THE
BOARD 

     Section 6. The chairman of
the board shall be the chief executive officer of the corporation, shall preside
at all meetings of the stockholders and the board of directors, shall have
general and active management of the business of the corporation and shall see
that all orders and resolutions of the board of directors are carried into
effect. 

     Section 7. He shall execute
bonds, mortgages and other contracts requiring a seal, under the seal of the
corporation, except where required or permitted by law to be otherwise signed
and executed and except where the signing and execution thereof shall be
expressly delegated by the board of directors to some other officer or agent of
the corporation. 

PRESIDENT 

     Section 8. The president,
subject to the control of the board of directors and the chairman of the board,
shall be in general charge of the day-to-day operations of the corporation. In
the absence or incapacity of the chairman of the board, he shall preside at all
meetings of the stockholders and of the board of directors. He may execute
contracts and other obligations in the name of the corporation when authorized
to do so in specific instances by the board of directors or the chairman of the
board; and he shall have such powers and perform such other duties as the board
of directors or the chairman of the board may from time to time, assign to him. 

THE VICE-PRESIDENTS 

     Section 9. In the absence
of the president or in the event of his inability or refusal to act, the
vice-presidents (or in the event there be more than one vice-presidents, the
vice-presidents in the order designated by the directors, or in the absence of
any designation, then in the order of their election) shall perform the duties
of the president, and when so acting shall have all the powers of and be subject
to all the restrictions upon the president. The vice-presidents shall perform
such other duties and have such other powers as the board of directors may from
time to time prescribe. 

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THE SECRETARY AND
ASSISTANT SECRETARY 

     Section 10. The secretary
shall attend all meetings of the board of directors and all meetings of the
stockholders and record all the proceedings of the meetings of the corporation
and of the board of directors in a book to be kept for that purpose and shall
perform like duties for the standing committees when required. He shall give, or
cause to be given, notice of all meetings of the stockholders and special
meetings of the board of directors, and shall perform such other duties as may
be prescribed by the board of directors or president, under whose supervision he
shall be. He shall have custody of the corporate seal of the corporation and he,
or an assistant secretary, shall have authority to affix the same to any
instrument requiring it and when so affixed, it may be attested by his signature
or by the signature of such assistant secretary. The board of directors may give
general authority to any other officer to affix the seal of the
corporation and to attest the affixing by his signature. 

     Section 11. The assistant
secretary, or if there be more than one, the assistant secretaries in the order
determined by the board of directors (or if there be no such determination, then
in the order of their election) shall, in the absence of the secretary or in the
event of his inability or refusal to act, perform the duties and exercise the
powers of the secretary and shall perform such other duties and have such other
powers as the board of directors may from time to time prescribe. 

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THE TREASURER AND
ASSISTANT TREASURERS 

     Section 12. The treasurer
shall have the custody of the corporate funds and securities and shall keep full
and accurate accounts of receipts and disbursements in books belonging to the
corporation and shall deposit all moneys and other valuable effects in the name
and to the credit of the corporation in such depositories as may be designated
by the board of directors. 

     Section 13. He shall
disburse the funds of the corporation as may be ordered by the board of
directors, taking proper vouchers for such disbursements, and shall render to
the president and the board of directors, at its regular meetings, or when the
board of directors so requires, an account of all his transactions as treasurer
and of the financial condition of the corporation. 

     Section 14. If required by
the board of directors, he shall give the corporation a bond in the sum and with
such surety or sureties as shall be satisfactory to the board of directors for
the faithful performance of the duties of his office and for the restoration to
the corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the corporation. 

     Section 15. The assistant
treasurer, or if there shall be more than one, the assistant treasurers in the
order determined by the board of directors (or if there be no such
determination, then in the order of their election), shall, in the absence of
the treasurer or in the event of his inability or refusal to act, perform the
duties and exercise the powers of the treasurer and shall perform such other
duties and have such other powers as the board of directors may from time to
time prescribe. 

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ARTICLE VI 

CERTIFICATE OF STOCK 

     Section 1. Every holder of
stock in the corporation shall be entitled to have a certificate, signed by, or
in the name of the corporation by, the chairman or vice-chairman of the board of
directors, or the president or a vice-president and the treasurer or an
assistant treasurer, or the secretary or an assistant secretary of the
corporation, certifying the number of shares owned by him in the corporation. 

     Section 2. Any of or all
the signatures on the certificate may be facsimile. In case any officer,
transfer agent or registrar who has signed or whose facsimile signature has been
placed upon a certificate shall have ceased to be such officer, transfer agent
or registrar before such certificate is issued, it may be issued by the
corporation with the same effect as if he were such officer, transfer agent or
registrar at the date of issue. 

LOST CERTIFICATES 

     Section 3. The board of
directors may direct a new certificate or certificates to be issued in place of
any certificate or certificates theretofore issued by the corporation
alleged to have been lost, stolen or destroyed, upon the making of an affidavit
of that fact by the person claiming the certificate of stock to be lost, stolen
or destroyed. When authorizing such issue of a new certificate or certificates,
the board of directors may, in its discretion and as a condition precedent to
the issuance thereof, require the owner of such lost, stolen or destroyed
certificate or certificates, or his legal representative, to advertise the same
in such manner as it shall require and/or to give the corporation a bond in such
sum as it may direct as indemnity against any claim that may be made against the
corporation with respect to the certificate alleged to have been lost, stolen or
destroyed. 

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TRANSFERS OF STOCK 

     Section 4. Upon surrender
to the corporation or the transfer agent of the corporation of a certificate for
shares duly endorsed or accompanied by proper evidence of succession,
assignation or authority to transfer, it shall be the duty of the corporation to
issue a new certificate to the person entitled thereto, cancel the old
certificate and record the transaction upon its books. 

FIXING RECORD DATE 

     Section 5. In order that
the corporation may determine the stockholders entitled to notice of or to vote
at any meeting of stockholders or any adjournment thereof, or to express consent
to corporate action in writing without a meeting, or entitled to receive payment
of any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the board of directors may fix, in
advance, a record date, which shall not be more than sixty nor less than ten
days before the date of such meetings, nor more than sixty days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the board of directors may fix a new record
date for the adjourned meeting. 

REGISTERED STOCKHOLDERS 

     Section 6. The corporation
shall be entitled to recognize the exclusive right of a person registered on its
books as the owner of shares to receive dividends, and to vote as such owner,
and to hold liable for calls and assessments a person registered on its books as
the owner of shares, and shall not be bound to recognize any equitable or other
claim to or interest in such share or shares on the part of any other
person, whether or not it shall have express or other notice thereof, except as
otherwise provided by the laws of Delaware. 

19 

	

ARTICLE VII 

INDEMNIFICATION 

     Section 1. The corporation
shall indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the corporation) by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys’ fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection with
such action, suit or proceeding it he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.  

     Section 2. The corporation
shall indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in the right
of the corporation to procure a judgment in its favor by reason of the fact that
he is or was a director, officer, employee or agent of the corporation, or is or
was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against expenses (including attorneys’ fees) actually and
reasonably incurred by him in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation and except that
no indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Court of Chancery or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court shall deem proper. 

20 

	

     Section 3. To the extent
that a director, officer, employee or agent of the corporation has been
successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in Sections 1 or 2 of this Article VII or in defense of
any claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys’ fees) actually and reasonably incurred by him in
connection therewith. 

     Section 4. Any
indemnification under Sections 1 or 2 of this Article VII (unless ordered by a
court) shall be made by the corporation only as authorized in the specific case
upon a determination that indemnification of the director, officer, employee or
agent is proper in the circumstances because he has met the applicable standard
of conduct set forth in Sections 1 or 2 of this Article VII. Such determination
shall be made (a) by a majority vote of directors who were not parties to such
action, suit or proceeding, even though less than a quorum, or (b) if there are
no such directors, or if such directors so direct, by independent legal counsel
in a written opinion, or (c) by the stockholders. 

21 

	

     Section 5. Expenses
(including attorneys’ fees) incurred by an officer or director in defending
a civil, criminal, administrative or investigative action, suit or proceeding
shall be paid by the corporation in advance of the final disposition of such
action, suit or proceeding upon receipt of an undertaking by or on behalf of
such director or officer to repay such amount if it shall ultimately be
determined that he is entitled to be indemnified by the corporation as
authorized in this Article VII. Such expenses (including attorneys’ fees)
incurred by other employees and agents may be so paid upon such terms and
conditions, if any, as the board of directors deems appropriate. 

     Section 6. The
indemnification and advancement of expenses provided by this Article VII shall
not be deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under the Certificate
of Incorporation or any agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person. 

     Section 7. The corporation
shall have power to purchase and maintain insurance on behalf of any person who
is or was a director, officer, employee or agent of the corporation, or is or
was serving at the request of the corporation, as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liability under
the provisions of this Article VII. 

22 

	

     Section 8. The
indemnification and advancement of expenses provided by, or granted pursuant to,
this Article VII shall, unless otherwise provided when authorized or ratified,
continue as to the person who has ceased to be a director, officer, employee or
agent and shall inure to the benefit of the heirs, executors and administrators
of such a person. 

ARTICLE VIII 

GENERAL PROVISIONS 

DIVIDENDS 

     Section 1. Dividends upon
the capital stock of the corporation subject to the provisions of the
Certificate of Incorporation, if any, may be declared by the board of directors
at any regular or special meeting, pursuant to law. Dividends may be paid in
cash, in property, or in shares of the capital stock, subject to the provisions
of the Certificate of Incorporation. 

     Section 2. Before payment
of any dividend, there may be set aside out of any funds of the corporation
available for dividends such sum or sums as the directors from time to time, in
their absolute discretion, think proper as a reserve or reserves to meet
contingencies, or for equalizing dividends, or for repairing or maintaining any
property of the corporation, or for such other purpose as the directors shall
think conducive to the interest of the corporation, and the directors may modify
or abolish any such reserve in the manner in which it was created. 

23 

	

ANNUAL STATEMENT 

     Section 3. The board of
directors shall present at each annual meeting, and at any special meeting of
the stockholders when called for by vote of the stockholders, a full and clear
statement of the business and condition of the corporation. 

CHECKS 

     Section 4. All checks or
demands for money and notes of the corporation shall be signed by such officer
or officers or such other person or persons as the board of directors may from
time to time designate. 

FISCAL YEAR 

     Section 5. The fiscal year
of the corporation shall be fixed by resolution of the board of directors. 

SEAL 

     Section 6. The corporate
seal shall have inscribed thereon the name of the corporation, the year of its
organization and the words “Corporate Seal, Delaware”. The seal may be
used by causing it or a facsimile thereof to be impressed or affixed or
reproduced or otherwise. 

ARTICLE IX 

AMENDMENTS 

     Section 1. These by-laws
may be altered, amended or repealed or new by-laws may be adopted by the
stockholders or by the board of directors, when such power is conferred upon the
board of directors by the Certificate of Incorporation at any regular meeting of
the stockholders or of the board of directors or at any special meeting of the
stockholders or of the board of directors if notice of such alteration,
amendment, repeal or adoption of new by-laws be contained in the notice of such
special meeting. If the power to adopt, amend or repeal by-laws is conferred
upon the board of directors by the Certificate of Incorporation it shall not
divest or limit the power of the stockholders to adopt, amend or repeal by-laws. 

24Exhibit 10.1

Exhibit 10.1

 

STANDSTILL AND AMENDMENT AGREEMENT

          This STANDSTILL AND AMENDMENT AGREEMENT (this "Standstill Agreement"), dated as of July 17, 2002, is among SEITEL, INC. (the "Company"), a Delaware corporation, each of its Subsidiaries identified below, and each of the investors listed on the signature pages hereto (together with successors and assigns of each, a "Noteholder," and collectively, the "Noteholders").  Capitalized terms have the respective meanings ascribed thereto in Section 1 hereof.

W I T N E S S E T H:

          WHEREAS, each of the 1995 Noteholders and the Company are party to those certain separate Note Purchase Agreements dated as of December 28, 1995 (collectively, as amended, the "1995 Note Purchase Agreement"), providing for the sale by the Company and the purchase by the 1995 Noteholders of the Company's 7.17% Series B Senior Notes due December 30, 2002 (the "Series B Notes") in the aggregate original principal amount of $27,500,000 and the Company's 7.48% Series C Senior Notes due December 30, 2002 (the "Series C Notes") in the aggregate original principal amount of $22,500,000; and

          WHEREAS, each of the 1999 Noteholders and the Company are party to those certain separate Note Purchase Agreements dated as of February 12, 1999 (collectively, as amended, the "1999 Note Purchase Agreement"), providing for the sale by the Company and the purchase by the 1999 Noteholders of the Company's 7.03% Series D Senior Notes due February 15, 2004 (the "Series D Notes") in the aggregate original principal amount of $20,000,000, the Company's 7.28% Series E Senior Notes due February 15, 2009 (the "Series E Notes") in the aggregate original principal amount of $75,000,000 and the Company's 7.43% Series F Senior Notes due February 15, 2009 (the "Series F Notes") in the aggregate original principal amount of $43,000,000; and

          WHEREAS, each of the 2001 Noteholders and the Company are party to those certain separate Note Purchase Agreements dated as of October 15, 2001 (collectively, the "2001 Note Purchase Agreement"), providing for the sale by the Company and the purchase by the 2001 Noteholders of the Company's 7.04% Series G Senior Notes due October 15, 2006 (the "Series G Notes") in the aggregate original principal amount of $20,000,000, the Company's 7.19% Series H Senior Notes due October 15, 2008 (the "Series H Notes") in the aggregate original principal amount of $50,000,000 and the Company's 7.34% Series I Senior Notes due October 15, 2011 (the "Series I Notes") in the aggregate original principal amount of $37,000,000; and

          WHEREAS, the 1995 Note Purchase Agreement, the 1999 Note Purchase Agreement and the 2001 Note Purchase Agreement are collectively referred to herein as the "Note Purchase Agreements;" and

          WHEREAS, the Series B Notes, the Series C Notes, the Series D Notes, the Series E Notes, the Series F Notes, the Series G Notes, the Series H Notes and the Series I Notes are collectively referred to herein as the "Notes;" and

          WHEREAS, the obligations of the Company under the Note Purchase Agreements and the Notes have been guaranteed by the Restricted Subsidiaries pursuant to the Subsidiary Guaranties; and

          WHEREAS, on the date hereof, the Company's records indicate that each Noteholder is the registered owner, in its own or its nominee's name, of one or more of the Notes; and

          WHEREAS, certain Defaults or Events of Default have occurred and are continuing; and

          WHEREAS, the Company acknowledges and agrees that the Noteholders currently have the right under the Note Purchase Agreements to accelerate the Notes immediately and otherwise exercise, or cause to be exercised, all rights and remedies available to the Noteholders under the Note Purchase Agreements and under law and in equity; and

          WHEREAS, the Company has requested that the Noteholders forbear from exercising any rights and remedies in respect of any Existing Event of Default during the Standstill Period and that the Noteholders provide certain other accommodations to the Company as set forth herein; and

          WHEREAS, the Company has, in consideration of the accommodations referred to in the immediately foregoing clause, agreed to comply with the terms and conditions of this Standstill Agreement; and

          WHEREAS, the Company and each Noteholder are desirous of entering into this Standstill Agreement on the terms and conditions hereinafter set forth.

          NOW, THEREFORE, in consideration of the matters referred to above, the mutual covenants set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.           DEFINITIONS.

          The following terms listed below have the meanings set forth below.  Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Note Purchase Agreements.

           "Company" has the meaning assigned to such term in the first paragraph hereof.

           "Effective Date" has the meaning assigned to such term in Section 8.

           "Existing Event of Default" means an Event of Default listed on Exhibit A hereto.

           "Financial Advisor" has the meaning assigned to such term in Section 5(c).

           "Financial Advisor Engagement Agreement" has the meaning assigned to such term in Section 5(c).

          "Financing Documents" means, collectively, each of the separate Note Purchase Agreements, as amended, the Notes, as amended, the Subsidiary Guaranties, and each of the other documents executed in connection with any of the foregoing, as any such documents may be amended from time to time.

          "1995 Note Purchase Agreement" has the meaning assigned to such term in the first "whereas" clause of this Standstill Agreement.

           "1995 Noteholders" means the parties listed in Schedule A hereto.

           "1999 Note Purchase Agreement" has the meaning assigned to such term in the second "whereas" clause of this Standstill Agreement.

           "1999 Noteholders" means the parties listed in Schedule B hereto.

           "Noteholders" has the meaning assigned to such term in the first paragraph hereof.

           "Note Purchase Agreements" has the meaning assigned to such term in the fourth "whereas" clause of this Standstill Agreement.

           "Notes" has the meaning assigned to such term in the fifth "whereas" clause of this Standstill Agreement.

           "Person" means and includes an individual, partnership, limited liability company, joint venture, corporation, trust, unincorporated organization or any government or any department or agency thereof.

           "PSA" means the Purchase and Sale Agreement dated as of July 4, 2002 between DDD Energy, Inc. and Rising Star Energy, L.L.C.

          "Required Noteholders" shall mean the holders of a majority of the principal amount of the Notes then outstanding issued under each of the 1995 Note Purchase Agreement, the 1999 Note Purchase Agreement and the 2001 Note Purchase Agreement.

           "Series B Notes" has the meaning assigned to such term in the first "whereas" clause hereof.

           "Series C Notes" has the meaning assigned to such term in the first "whereas" clause of this Standstill Agreement.

           "Series D Notes" has the meaning assigned to such term in the second "whereas" clause of this Standstill Agreement.

           "Series E Notes" has the meaning assigned to such term in the second "whereas" clause of this Standstill Agreement.

           "Series F Notes" has the meaning assigned to such term in the second "whereas" clause of this Standstill Agreement.

           "Series G Notes" has the meaning assigned to such term in the third "whereas" clause of this Standstill Agreement.

           "Series H Notes" has the meaning assigned to such term in the third "whereas" clause of this Standstill Agreement.

           "Series I Notes" has the meaning assigned to such term in the third "whereas" clause of this Standstill Agreement.

           "Senior Officer" means with respect to any Person, any member of the board of directors, the chief executive officer, the chief operating officer, the chief financial officer, the president and any vice president or more senior officer of such Person.

           "Standstill Agreement" has the meaning assigned to such term in the first paragraph of this Standstill Agreement.

           "Standstill Period" means the period commencing on the Effective Date and ending on the Termination Date.

           "Subsidiary Guarantors" means all of the Subsidiaries party to Subsidiary Guaranties.

           "Termination Date" means the earlier of

	 
  	

(i)
	

October 15, 2002; and

	 
  	

(ii)
	

the date of occurrence of a Termination Event.

  

           "Termination Event" means 

	 	
(i)
	
 the failure by the Company to perform any covenant set forth in Section 5;

	 	
(ii)
	
the failure of any representation or warranty in Section 6 to be true and correct;

	 	
(iii)
	
the occurrence of any Default or Event of Default other than an Existing Event of Default;

	 	
(iv)
	
on or after the Effective Date the Company or any Subsidiary is (A) in default (as principal or as guarantor or other surety) in payment of any principal of or premium or make-whole amount or interest on any Debt that is outstanding in an aggregate principal amount of at least $5,000,000 beyond any period of grace provided with respect thereto or (B) in default in the performance of or compliance with any term of any evidence of any Debt in an aggregate outstanding principal amount of at least $5,000,000 or of any mortgage, indenture or other agreement relating thereto, or any other condition exists, and, as a consequence of such default or condition such Debt has become, or has been declared, due and payable before its stated maturity or before its regularly scheduled dates or payment (excluding, in each case, Debt consisting of Winthrop Lease obligations);

	 	
(v)
	
as a consequence of the occurrence or continuation of any event or condition, (x) the Company or any Subsidiary has become or is obligated on or after the Effective Date to purchase or repay Debt before its regular maturity or before its regularly scheduled dates of payment in an aggregate outstanding principal amount of at least $5,000,000, or (y) one or more Persons have the right on or after the Effective Date to require the Company or any Subsidiary to purchase or repay Debt or other amounts before its regular maturity or before its regularly scheduled dates or payment in an aggregate outstanding principal amount of at least $5,000,000 (excluding, in each case, Debt consisting of Winthrop Lease obligations);

	 	 	 
	 	
(vi)
	
a violation by the Company or a Subsidiary of any term or condition of the Noteholder Consent dated as of July 15, 2002 between the Company and certain of the Noteholders;

	 	
(vii)
	
the failure of the Closing (as such term is defined in the PSA) to occur, and the funds payable in respect of the sale of the Acquired Assets (as such term is defined in the PSA) to be received by the Company and/or DDD Energy, Inc., in each instance on or before August 31, 2002; or

	 	
(viii)
	
the expiration (without extension or renewal) or the termination of the Royal Bank of Canada facilities listed on Exhibit B hereto.

 

          "2001 Note Purchase Agreement" has the meaning assigned to such term in the third "whereas" clause of this Standstill Agreement.

          "2001 Noteholders" means the parties listed in Schedule C hereto.

          "Winthrop Lease" means the Lease Agreement dated October 3, 2001, from Winthrop Resources Corporation to Seitel, Inc. with respect to computer and related equipment.

2.           STANDSTILL PERIOD.

          The Noteholders agree, during the Standstill Period, to forbear from exercising any rights and remedies they may have under any or all of the Note Purchase Agreements or any of the Notes or any of the other Financing Documents solely as a result of the existence or occurrence of any Existing Event of Default.  The Company acknowledges that upon the termination of the Standstill Period, such forbearance by the Noteholders shall terminate and the Noteholders may immediately exercise, without further notice, any one or more of such rights and remedies without notice or demand in respect of any Default, Event of Default or Existing Event of Default.  The Company has indicated that during the Standstill Period it may identify asset sales or alternative financing that will enable it to meet certain of its immediate cash needs, and the Company has indicated that it will present for Noteholder approval any such proposed asset sales or financing arrangements.

3.          AMENDMENTS.

          Each of the Note Purchase Agreements and the Notes is hereby amended to effect an increase in the interest rate payable on each Note of twenty-five basis points (0.25%) per annum and to change each reference to the interest rate applicable to any Note to such increased interest rate, in each case with respect to the period from July 17, 2002 through and including October 15, 2002.  No other action on the part of the Company (including no physical notation on any Note) shall be necessary to give effect to this amendment. 

4.           NOTICE OF TERMINATION EVENT.

          The Company shall give each of the Noteholders immediate written notice of the occurrence of any Termination Event.

5.           ADDITIONAL COVENANTS OF COMPANY.

           (a)          Override of Certain Financial Covenants.  During the period from the Effective Date through October 15, 2002, Sections 10.3 through 10.7 and Section 10.9 of the 1995 Note Purchase Agreement and the 1999 Note Purchase Agreement, and Sections 11.3 through 11.7 and Section 11.9 of the 2001 Note Purchase Agreement, shall be suspended and, in lieu thereof, the Company shall, and shall cause its Subsidiaries to, comply with the provisions of Section 5(b) of this Standstill Agreement, provided, however, that no write-down of DDD Energy, Inc. assets or assets constituting the maritime seismic data library on the Company's, a Subsidiary's, or any consolidated, financial statements shall cause any Default or Event of Default under the Note Purchase Agreements or the Notes, or a Termination Event hereunder, during the Standstill Period.

           (b)          Supplemental Covenants of the Company.  During the period from the Effective Date through October 15, 2002, the Company shall not, and shall not permit any Subsidiary (including, without limitation, any Subsidiary organized under the laws of, or otherwise existing or domiciled in, Canada or any province or other jurisdiction therein (the "Canadian Subsidiaries")) to:

	 	
(i)
	 	
make, directly or indirectly, any Restricted Payment (references to "Restricted Subsidiaries" in the definition of "Restricted Payment" being deemed to be references to "Subsidiaries" except for the second reference to "Restricted Subsidiaries" in the parenthetical expression in  paragraph (a) of the definition of "Restricted Payment");

	 	
(ii)
	 	
make, directly or indirectly, any Restricted Investment, provided that the Company and the Subsidiaries may make Restricted Investments constituting unsubordinated debt obligations of Unrestricted Subsidiaries during the period from July 17, 2002 through and including October 15, 2002 in an amount limited to (x) an aggregate amount of $5,400,000 of Restricted Investments that are made by the Company and the Restricted Subsidiaries in Seitel Solutions, Ltd. and/or Endeavor Exploration, LLC and (y) to the extent not otherwise available from the Canadian Subsidiaries, an aggregate amount of $1,000,000 of Restricted Investments that are made by the Company and the Restricted Subsidiaries in the Canadian Subsidiaries in respect of a certain lease agreement with I.B.M., provided, however, that Canadian Subsidiaries shall be permitted to make Restricted Investments in other Canadian Subsidiaries in the ordinary course of business of such entities;

	 	
(iii)
	 	
create, incur or assume any Debt, provided that the Company and the Subsidiaries (including, without limitation, the Canadian Subsidiaries) shall not be prohibited from drawing amounts available under existing revolving credit lines and facilities and term loans (as in effect on the date hereof) identified as items (3) and (4) on Exhibit B hereto, and including replacements therefor on substantially similar terms that are subject to the same limits;

	 	
(iv)
	 	
effectuate any Transfer (including, without limitation, any Transfer involving the assets of DDD Energy, Inc.) except for (a) Transfers of inventory in the ordinary course of business, (b) Transfers to Unrestricted Subsidiaries permitted pursuant to clause (ii) above, (c) Transfers to Wholly-Owned Restricted Subsidiaries in the ordinary course of business, (d) Transfers to Affiliates that constitute joint ventures of the Company or its Subsidiaries with unrelated third parties, which Transfers are made in the ordinary course of business and pursuant to preexisting contractual obligations of the Company and the Subsidiaries, in an aggregate amount for the period from July 17, 2002 through and including October 15, 2002 not to exceed $1,917,000 of capital expenditures for exploration and production activities, and $20,000,000 of capital expenditures for seismic data acquisition projects, and (e) Transfers that have been approved by the Required Noteholders in writing;

	 	
(v)
	 	
settle, sell, compromise and/or discount any loans made to any officers, directors and/or employees of the Company or any Subsidiary;

	 	
(vi)
	 	
merge or consolidate with any other Person;

	
	
(vii)
	
	
pay any bonuses, or pay any advances on commissions, to any Senior Officer of the Company or any Subsidiary, other than such payments that are due and payable during the Standstill Period that are identified on Exhibit C hereto, or which otherwise have been approved by the Required Noteholders in writing; or

	
	
(viii)
	
	
create, incur or assume any Lien upon any of the property or assets of the Company or any Subsidiary, whether now owned or hereafter acquired, except for those Liens permitted by Section 10.4(a) through (i) of the 1995 Note Purchase Agreement and the 1999 Note Purchase Agreement, and Section 11.4(a) through (i) of the 2001 Note Purchase Agreement.

          (c)          Financial Advisor. The Company agrees to the hiring by the Noteholders' special counsel of Crossroads, LLC to act as financial advisor (the "Financial Advisor") to the Noteholders' special counsel and the Company agrees to pay the fees and expenses of the Financial Advisor in accordance with that engagement letter between Bingham Dana LLP (now Bingham McCutchen LLP) and the Financial Advisor dated June 11, 2002 which engagement letter has been acknowledged and agreed to by the Company (the "Financial Advisor Engagement Agreement").  The Company shall provide the Financial Advisor with full onsite access to its books and records and the opportunity to discuss the Company's financial condition, performance, financial statements and other matters pertinent to the Noteholders' investment in the Company with its officers, directors, independent accountants and financial advisors to permit the Financial Advisor to fully investigate any matter that arises during its review of the financial information of the Company and its Subsidiaries.  The Financial Advisor shall have no duty to share its work product with, or accept instructions from, the Company or any other Person working on its behalf.

          (d)          Delivery of Business Plan. The Company shall prepare, in consultation with PricewaterhouseCoopers L.L.P., a proposed business plan with respect to the Company's and the Subsidiaries' core and ancillary business lines, and shall deliver such business plan (or a substantially complete draft thereof) to the Noteholders on or before August 19, 2002.  The business plan will, among other things, incorporate the results of the initiatives and milestones identified in the Company's written materials entitled "Noteholders Meeting July 15, 2002" (all of which milestones shall have been met by August 31, 2002). The failure of the business plan (as it may be revised or amended) and the proposals contained therein to be satisfactory to the Required Noteholders in their sole discretion, and such satisfaction to be certified in writing by the Required Noteholders, by August 31, 2002, shall constitute a Termination Event on August 31, 2002. 

          (e)          Joint Ventures.  Neither the Company nor any Subsidiary (including, without limitation, DDD Energy, Inc.) shall enter into any joint venture or similar arrangement with any Person (including, without limitation, with Rising Star Energy, L.L.C. and/or any Affiliates thereof) without the prior written consent of the Required Noteholders, to be granted or withheld in their reasonable discretion.

          (f)          Certain Interest Payments.  The Company confirms its agreement to pay to the Noteholders in respect of the Notes (i) an amount equal to the interest obligations due on the Notes (all series) through the Closing Date (as such term is defined in the PSA) directly to the Noteholders (or an account or accounts to be designated by the Noteholders, for further distribution to the Noteholders) at the Closing (as such term is defined in the PSA), (ii) ratable interest on the Notes monthly on the anniversary of the Closing Date (as such term is defined in the PSA) or the first business day thereafter, through the conclusion of the respective terms of the Notes as provided in the Note Purchase Agreement and (iii) at the time or times provided in Section 2(c) of the Noteholder Consent dated as of July 15, 2002 among the Company and certain Noteholders, the amount of interest due on the Notes at such time or times.

6.           REPRESENTATIONS AND WARRANTIES.

          To induce the Noteholders to enter into this Standstill Agreement, the Company represents and warrants, as of the Effective Date, as follows:

          (a)          the Company is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware;

          (b)          each of the Subsidiaries is an organization duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization;

          (c)          the execution and delivery of this Standstill Agreement is within the corporate powers of the Company and each Subsidiary Guarantor, has been duly authorized by the Company and each Subsidiary Guarantor and constitute a valid and binding obligation of the Company and each Subsidiary Guarantor, enforceable in accordance with its terms, except that such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforceability of creditors' rights generally and except that such enforceability is subject to the availability of equitable remedies; 

          (d)          The execution and delivery of this Standstill Agreement does not conflict with, result in any breach of any of the provisions of, constitute a default under, or result in the creation of any Lien upon any property of the Company or any Subsidiary Guarantor under the provisions of, any agreement, charter instrument, bylaw or other instrument to which the Company or any Subsidiary Guarantor is a party or by which the Company, any of its Subsidiaries, or any of their respective properties may be bound;

          (e)          each of the Notes, the Note Purchase Agreements and the other Financing Documents to which the Company and each Subsidiary Guarantor is a party, as modified by this Standstill Agreement, constitutes a valid and binding obligation of the Company and such Subsidiary Guarantor party thereto, enforceable in accordance with its terms, except that such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforceability of creditors' rights generally and except that such enforceability is subject to the availability of equitable remedies;

          (f)          except with respect to Existing Events of Default, there are, to the best present actual knowledge of the Company, no Defaults or Events of Default in existence on the Effective Date (although the Company continues its investigation and diligence into certain matters that may reveal the existence of additional Defaults or Events of Default); and

          (g)          except as disclosed on Exhibit B hereto, neither the Company nor any Subsidiary has any Debt to any Person or group of Persons that is outstanding (including any drawn or undrawn facilities providing for the incurrence of Debt) in an aggregate principal amount with respect to such Person or group of Persons of more than $5,000,000.

7.          NONWAIVER AND NO AMENDMENT.

          Except as expressly set forth herein, the terms of this Standstill Agreement shall not operate as a waiver by any of the Noteholders of, or otherwise prejudice, the Noteholders' rights, remedies or powers under the Notes, the Note Purchase Agreements, the other Financing Documents or applicable law.  With respect to any Event of Default under any of the Note Purchase Agreements, as modified by this Standstill Agreement, other than any Existing Event of Default, any of the Noteholders may exercise the rights, remedies and powers provided in such Note Purchase Agreement and the other Financing Documents in accordance with the terms of such documents regardless of whether such Event of Default shall exist on the date hereof or come into existence during the Standstill Period.  Except to the extent expressly provided for herein, this Standstill Agreement shall not operate to waive or otherwise prejudice any rights which the Noteholders may have against the Company, any party to a Subsidiary Guaranty or any other Person arising under the Note Purchase Agreements, the Notes, the other Financing Documents or otherwise.

          Except as expressly provided herein, no terms or provisions of the Note Purchase Agreements, the Notes or the other Financing Documents are modified or changed by this Standstill Agreement, and all of the terms and provisions of the Note Purchase Agreements, the Notes and the other Financing Documents shall continue in full force and effect.  The Company and the parties to the Subsidiary Guaranties hereby acknowledge and reaffirm all of their respective obligations and duties under each of the Note Purchase Agreements, the Notes and the other Financing Documents to which each is a party, as each such Financing Document is modified by this Standstill Agreement.

8.           EFFECTIVE DATE.

          The "Effective Date" shall be the first date on which the Company and the Required Noteholders shall have executed and delivered this Standstill Agreement.

9.           EXPENSES AND FEES.

          The Company hereby agrees to pay all reasonable costs and expenses of the Noteholders (it being understood and agreed by the Company that the Noteholders shall have wide latitude on the scope and depth of legal analysis they obtain from their legal and financial advisors to evaluate, explore, and protect Noteholder interests regarding the Company and the Notes in light of existing defaults, accounting and executive officer irregularities, and related matters affecting the Company's business plan, viability, and restructuring prospects), including, without limitation, the fees and expenses of Bingham McCutchen LLP, special counsel to the Noteholders, and Crossroads, LLC, the Noteholders' Financial Advisor, and also including the reasonable out-of-pocket travel and other expenses of the Noteholders incurred in connection with this Standstill Agreement and the collection of any sum owed to any of the Noteholders by the Company and in otherwise assessing, analyzing, evaluating, protecting, asserting, defending or enforcing any rights or remedies which are or may be available to the Noteholders, including, without limitation, representatives of the Noteholders in any bankruptcy proceeding.  

10.           HEADINGS.

          All headings and captions preceding the text of the several Sections of this Standstill Agreement are intended solely for the convenience of reference and shall not constitute a part of this Standstill Agreement nor shall they affect its meaning, construction or effect.

11.           ENTIRE AGREEMENT.

          This Standstill Agreement, the Note Purchase Agreement, the Notes and the other Financing Documents, as amended to the date hereof, embody the entire agreement and understanding between the Noteholders, the Company and the parties to the Subsidiary Guaranties and supersede all prior agreements and understandings relating to the subject matter hereof and thereof.

12.           GOVERNING LAW.

          This Standstill Agreement shall be governed by, and construed in accordance with, the internal laws of the State of New York.

13.           DIRECTLY OR INDIRECTLY.

          Where any provision in this Standstill Agreement refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person, including actions taken by or on behalf of any partnership or limited liability company in which such Person is a general partner or managing member, as applicable.

14.           COUNTERPARTS.

          This Standstill Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.  An executed copy of this Standstill Agreement sent by facsimile shall be effective as an original.

15.           NOTICES.

          All communications under this Standstill Agreement shall be made in accordance with the Note Purchase Agreements.

[Remainder page intentionally left blank.  Next page is signature page.]

 

In witness whereof, the parties hereto have caused this Standstill Agreement to be executed by their authorized officers as of the date first written above.

	
PRINCIPAL LIFE INSURANCE COMPANY

	
By:
	
Principal Capital Management, LLC, a Delaware limited liability company, its authorized signatory

	
By:
	
/s/ Jon C. Heiny

		
  

  
	 	
Name:
	
Jon C. Heiny

	 	
Title:
	
Counsel

	 	 	 
	
By:
	
/s/ Christopher J. Henderson

		
  

  
	 	
Name:  
	
Christopher J. Henderson

	 	
Title:
	
Counsel

  	

  
	
PRINCIPAL LIFE INSURANCE COMPANY, ON BEHALF OF ONE OR MORE SEPARATE ACCOUNTS

	
By:
	
Principal Capital Management, LLC, a Delaware limited liability company, its authorized signatory

	
By:
	
/s/ Jon C. Heiny

		
  

  
	 	
Name:
	
Jon C. Heiny

	 	
Title:
	
Counsel

	 	 	 
	
By:
	
/s/ Christopher J. Henderson

		
  

  
	 	
Name:  
	
Christopher J. Henderson

	 	
Title:
	
Counsel

  	

  
	

CGU LIFE INSURANCE COMPANY OF AMERICA, a Delaware corporation (formerly known as Commercial

Union Life Insurance Company of America)

  
	
By:
	
Principal Capital Management, LLC, a Delaware limited liability company, its attorney in fact

	
By:
	
/s/ Jon C. Heiny

		
  

  
	 	
Name:
	
Jon C. Heiny

	 	
Title:
	
Counsel

	 	 	 
	
By:
	
/s/ Christopher J. Henderson

		
  

  
	 	
Name:  
	
Christopher J. Henderson

	 	
Title:
	
Counsel

  	

  
	
ALLSTATE LIFE INSURANCE COMPANY

	
By:
	
/s/ W.R. Schmidt

		
  

  
	 	
Name:
	
W.R. Schmidt

	 	
Title:
	
Authorized Signatory

	 	 	 
	
By:
	
/s/ Pat Wilson

		
  

  
	 	
Name:  
	
Pat Wilson

	 	
Title:
	
Authorized Signatory

  	

  
	
ALLSTATE LIFE INSURANCE COMPANY OF NEW YORK

	
By:
	
/s/ W.R. Schmidt

		
  

  
	 	
Name:
	
W.R. Schmidt

	 	
Title:
	
Authorized Signatory

	 	 	 
	
By:
	
/s/ Pat Wilson

		
  

  
	 	
Name:  
	
Pat Wilson

	 	
Title:
	
Authorized Signatory

  	

  
	
MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY

	
By:
	
David L. Babson & Company Inc.

as Investment Adviser 

 

  
	
By:
	
/s/ Richard B. McCauley

		
  

  
	 	
Name:
	
Richard B. McCauley

	 	
Title:
	
Managing Director

  	

  
	
C.M. LIFE INSURANCE COMPANY

	
By:
	
David L. Babson and Company Inc. as Investment Sub-Adviser

	
By:
	
/s/ Richard B. McCauley

		
  

  
	 	
Name:
	
Richard B. McCauley

	 	
Title:
	
Managing Director

  	

  
	
MASSMUTUAL ASIA LIMITED

	
By:
	
David L. Babson & Company Inc. as Investment Adviser

	
By:
	
/s/ Richard B. McCauley

		
  

  
	 	
Name:
	
Richard B. McCauley

	 	
Title:
	
Managing Director

  	

  
	
PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY

THE PAUL REVERE LIFE INSURANCE COMPANY

  
	
Severally By:
	
Provident Investment Management, LLC

	
Their:
	
Agent

	
By:
	
/s/ David Fussell

		
  

  
	 	
Name:
	
David Fussell

	 	
Title:
	
Senior Vice President

  	

  
	
THE GUARDIAN INSURANCE & ANNUITY COMPANY, INC.

	
By:
	
/s/ Thomas M. Donohue

		
  

  
	 	
Name:
	
Thomas M. Donohue

	 	
Title:
	
Managing Director

  	

  
	
FORT DEARBORN LIFE INSURANCE COMPANY

	
By:
	
Guardian Investor Services LLC

	
By:
	
/s/ Thomas M. Donohue

		
  

  
	 	
Name:
	
Thomas M. Donohue

	 	
Title:
	
Managing Director

  	

  
	
THE GUARDIAN LIFE INSURANCE COMPANY OF AMERICA

	
By:
	
/s/ Thomas M. Donohue

		
  

  
	 	
Name:
	
Thomas M. Donohue

	 	
Title:
	
Managing Director

  	

  
	
BERKSHIRE LIFE INSURANCE COMPANY OF AMERICA

	
By:
	
/s/ Thomas M. Donohue

		
  

  
	 	
Name:
	
Thomas M. Donohue

	 	
Title:
	
Managing Director

  
  	

  
	
J. ROMEO & CO. as Nominee for

MONY LIFE INSURANCE COMPANY

  
	
By:
	
/s/ Barbara J. Walsh

		
  

  
	 	
Name:
	
Barbara J. Walsh

	 	
Title:
	 Authorized
  Signatory

  	

  
	
J. ROMEO & CO. as Nominee for

MONY LIFE INSURANCE COMPANY OF AMERICA

  
	
By:
	
/s/ Barbara J. Walsh

		
  

  
	 	
Name:
	
Barbara J. Walsh

	 	
Title:
	 Authorized
  Signatory

  	

  
	
PHOENIX LIFE INSURANCE COMPANY

	
By:
	
/s/ Christopher M. Wilkos

		
  

  
	 	
Name:
	
Christopher M. Wilkos

	 	
Title:
	
Senior Vice President

  	

  
	
CONNECTICUT GENERAL LIFE INSURANCE COMPANY

	
By:
	
CIGNA Investments, Inc. (authorized agent)

	
By:
	
/s/ Robert W. Eccles

		
  

  
	 	
Name:
	
Robert W. Eccles

	 	
Title:
	
Managing Director

  	

  
	
LIFE INSURANCE COMPANY OF NORTH AMERICA

	
By:
	
CIGNA Investments, Inc. (authorized agent)

	
By:
	
/s/ Robert W. Eccles

		
  

  
	 	
Name:
	
Robert W. Eccles

	 	
Title:
	
Managing Director

  	

  
	
NATIONWIDE LIFE INSURANCE COMPANY

	
By:
	
/s/ Mark W. Poeppelman

		
  

  
	 	
Name:
	
Mark W. Poeppelman

	 	
Title:
	
Associate Vice President

  	

  
	
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY

	
By:
	
/s/ Mark W. Poeppelman

		
  

  
	 	
Name:
	
Mark W. Poeppelman

	 	
Title:
	
Associate Vice President

  
  	

  
	
UNITED OF OMAHA LIFE INSURANCE COMPANY

	
By:
	
/s/ Curtis R. Caldwell

		
  

  
	 	
Name:
	
Curtis R. Caldwell

	 	
Title:
	
Vice President

  	

  
	
RELIASTAR LIFE INSURANCE COMPANY

	
By:
	
ING Investment Management, LLC, as Agent

	
By:
	
/s/ James V. Wittich

		
  

  
	 	
Name:
	
James V. Wittich

	 	
Title:
	
Senior Vice President

  	

  
	
NORTHERN LIFE INSURANCE COMPANY

	
By:
	
ING Investment Management, LLC, as Agent

	
By:
	
/s/ James V. Wittich

		
  

  
	 	
Name:
	
James V. Wittich

	 	
Title:
	
Senior Vice President

  	

  
	
RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK

	
By:
	
ING Investment Management LLC, as Agent

	
By:
	
/s/ James V. Wittich

		
  

  
	 	
Name:
	
James V. Wittich

	 	
Title:
	
Senior Vice President

	

  
	
SECURITY CONNECTICUT LIFE INSURANCE COMPANY

	
By:
	
ING Investment Management LLC, as Agent

	
By:
	
/s/ James V. Wittich

		
  

  
	 	
Name:
	
James V. Wittich

	 	
Title:
	
Senior Vice President

  
  	

  
	
TRUSTMARK LIFE INSURANCE CO.

	
By:
	
/s/ Jerry Hitpas

		
  

  
	 	
Name:
	
Jerry Hitpas

	 	
Title:
	
Senior Vice President

  	

  
	
AMERICAN INVESTORS LIFE INSURANCE COMPANY

	
By:
	
AmerUs Capital Management Group, Inc., its authorized attorney-in-fact

	
By:
	
/s/ Roger D. Fors

		
  

  
	 	
Name:
	
Roger D. Fors

	 	
Title:
	
Vice President, Investment Management & Research

  	

  
	
PAN-AMERICAN LIFE INSURANCE COMPANY

	
By:
	 
		
  

  
	 	
Name:
	 
	 	
Title:
	 

  	

  
	
OXFORD LIFE INSURANCE COMPANY

	
By:
	 
		
  

  
	 	
Name:
	 
	 	
Title:
	 

  	

  
	
UNITED LIFE INSURANCE COMPANY

	
By:
	
/s/ John A. Rife

		
  

  
	 	
Name:
	
John A. Rife

	 	
Title:
	
President and Chief Executive Officer

  
  	

  
	
SUNAMERICA LIFE INSURANCE COMPANY

	
By:
	
AIG Global Investment Corp., Investment Adviser

	
By:
	
/s/ Gregory S. Hammer

		
  

  
	 	
Name:
	
Gregory S. Hammer

	 	
Title:
	
Vice President

  
  	

  
	
FIRST SUNAMERICA LIFE INSURANCE COMPANY

	
By:
	
/s/ Gregory S. Hammer

		
  

  
	 	
Name:
	
Gregory S. Hammer

	 	
Title:
	
Vice President

  	

  
	
REPUBLIC WESTERN INSURANCE COMPANY

	
By:
	
/s/ Kristin Spears

		
  

  
	 	
Name:
	
Kristin Spears

	 	
Title:
	
Vice President, Treasury Management

 

 

	
SEITEL, INC.

	
  	

  
	
By:
	
/s/ Kevin S. Fiur

		
  

  
	 	
Name:
	
Kevin S. Fiur

	 	
Title:
	
President and Chief Executive Officer

 

Accepted and Agreed:

	
SEITEL DATA CORP.

	 	 
	
By:
	
/s/ Kevin S. Fiur

		
  

  
	 	
Name:
	
Kevin S. Fiur

	 	
Title:
	
President and Chief Executive Officer

	
SEITEL DATA, LTD.

	
By:
	
Seitel Delaware, Inc., general partner

	 	 
	
By:
	
/s/ Kevin S. Fiur

		
  

  
	 	
Name:
	
Kevin S. Fiur

	 	
Title:
	
President and Chief Executive Officer

	
N360X, L.L.C.

	
By:
	
Seitel Management, Inc.,

managing member

  
	 	 
	
By:
	
/s/ Kevin S. Fiur

		
  

  
	 	
Name:
	
Kevin S. Fiur

	 	
Title:
	
President and Chief Executive Officer

	
SEITEL MANAGEMENT, INC.

	 	 
	
By:
	
/s/ Kevin S. Fiur

		
  

  
	 	
Name:
	
Kevin S. Fiur

	 	
Title:
	
President and Chief Executive Officer

	

  
	
SEITEL GEOPHYSICAL, INC.

DDD ENERGY, INC.

SEITEL GAS & ENERGY CORP.

SEITEL POWER CORP.

SEITEL NATURAL GAS, INC.

MATRIX GEOPHYSICAL, INC.

EXSOL, INC.

DATATEL, INC.

SEITEL OFFSHORE CORP.

SEITEL INTERNATIONAL, INC.

AFRICAN GEOPHYSICAL, INC.

GEO-BANK, INC.

ALTERNATIVE COMMUNICATION

    ENTERPRISES, INC.

SEITEL DELAWARE, INC.

  
	 	 
	
By:
	
/s/ Kevin S. Fiur

		
  

  
	 	
Name:
	
Kevin S. Fiur

	 	
Title:
	
President and Chief Executive Officer

EXHIBIT A

EXISTING EVENTS OF DEFAULT

1995 Note Purchase Agreement

1. The failure of the Company to comply with Section 10.2 for the period of five consecutive fiscal quarters ended on June 30, 2002.

1999 Note Purchase Agreement

1. The failure of the Company to comply with Section 10.2 for the period of five consecutive fiscal quarters ended on June 30, 2002.

2. The failure of the Company to comply with Section 10.7(a) by making Restricted Payments and/or Restricted Investments during the fiscal quarter ending on March 31, 2002 that exceeded the permissible amount under Section 10.7(a) by not more than $10,000,000.

2001 Note Purchase Agreement

1. The failure of the Company to comply with Section 11.2 for the period of five consecutive fiscal quarters ended on June 30, 2002.

EXHIBIT B

OUTSTANDING DEBT

(1) Heller Financial Services Inc. in the amount of approximately $10,000,000, which obligation is secured by certain assets of the Company and/or the Subsidiaries

(2) Alliance Agreement entered into as of December 1, 1999 between

GECO-PRAKLA, a Division of Schlumberger Technology Corporation, and Seitel

Data, Ltd. in the amount of approximately $5,000,000 (for acquisition costs of data in connection with data shoots undertaken in 2000 and 2001)

(3) Royal Bank of Canada term loan in the outstanding principal amount of approximately (Canadian) $3,500,000, secured by certain assets of the Company and/or the Subsidiaries

(4) Royal Bank of Canada revolving loan in the outstanding principal amount as of June 30, 2002 of approximately (Canadian) $3,600,000 (with a maximum principal amount of (Canadian) $5,000,000) with Olympic Seismic Ltd., secured by certain assets of the Company and/or the Subsidiaries

(5) Lease Agreement dated October 3, 2001 from Winthrop Resources Corporation to Seitel, Inc. with respect to computer and related equipment

 EXHIBIT C

  CERTAIN COMPENSATION CONTRACTS

  
Payment not in excess of $100,000 pursuant to the existing Employment Agreement with Kevin Fiur 

Payment of amounts owed in respect of the sale of certain DDD Energy, Inc. assets pursuant to an Employment Agreement dated February 12, 2001 between Matt Ramsey and DDD Energy, Inc. 

Payment of amounts owed in respect of the sale of certain DDD Energy, Inc. assets pursuant to an Employment Agreement dated January 1, 2002 between Lynn Conine and DDD Energy, Inc. 

 

SCHEDULE A

1995 NOTEHOLDERS

Massachusetts Mutual Life Insurance Company

SunAmerica Life Insurance Company

First SunAmerica Life Insurance Company

MONY Life Insurance Company

MONY Life Insurance Company of America

United of Omaha Life Insurance Company

Pan-American Life Insurance Company 

SCHEDULE B

1999 NOTEHOLDERS

Principal Life Insurance Company

Principal Life Insurance Company, on behalf of one or more separate accounts

CGU Life Insurance Company of America

Allstate Life Insurance Company

Allstate Life Insurance Company of New York

Provident Life and Accident Insurance Company

The Paul Revere Life Insurance Company

Massachusetts Mutual Life Insurance Company

C.M. Life Insurance Company

United of Omaha Life Insurance Company

Phoenix Life Insurance Company

Reliastar Life Insurance Company

Northern Life Insurance Company

Reliastar Life Insurance Company of New York

Security Connecticut Life Insurance Company

Trustmark Life Insurance Co.

Pan-American Life Insurance Company

Republic Western Insurance Company

Oxford Life Insurance Company

United Life Insurance Company

 

 

SCHEDULE C

2001 NOTEHOLDERS

  The Guardian Insurance & Annuity Company

Fort Dearborn Life Insurance Company

The Guardian Life Insurance Company of America

Berkshire Life Insurance Company of America

MONY Life Insurance Company

Nationwide Life Insurance Company

Nationwide Life and Annuity Insurance Company

Connecticut General Life Insurance Company

Life Insurance Company of North America

Massachusetts Mutual Life Insurance Company

C.M. Life Insurance Company

MassMutual Asia Limited

Allstate Life Insurance Company

Principal Life Insurance Company

Phoenix Life Insurance Company

American Investors Life Insurance Company

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