, a provider of data to oil and gas companies, said Friday that it will take a $3.9 million after-tax charge in the second quarter because of the buyout of management incentive bonus contracts.
The one-time charge translates to a charge of 16 cents per share. Management incentive bonus pay has now been reduced to 8.5% of pretax income from 17.5%. The bonus of Chairman of the Board Herbert Pearlman has been reduced to 3.5% of pretax profits in exchange for 150,000 shares of restricted stock and four annual payments of $187,500 net of taxes beginning Jan. 1, 2001.
The bonus of President and Chief Executive Paul Frame has been reduced to 3% of pretax profits in exchange for 100,000 shares of restricted Seitel stock and four annual payments of $125,000. The bonus of co-founder David Lawi, who also announced his resignation from the board of directors, has been eliminated for 125,000 shares of restricted Seitel stock and $1.6 million net of taxes payable over four years.
Also, the automatic renewal of Pearlman's and Frame's contracts have been discontinued.
"The sweeping changes to executive compensation and the board of directors were in response to shareholder comments," said Pearlman in a statement.
The Houston-based company possesses the largest seismic databank in North America, which is used to identify underground geologic structures and hydrocarbons.
Shares of Seitel closed Thursday trading at 8 1/16, down 1/8, or 2%. There was no activity in post-market trading, according to