SUPPLEMENTAL GUARANTORS CONSOLIDATING CONDENSED FINANCIAL INFORMATION

On February 14, 2007, the Company completed a private placement of 9.75% Senior Notes in the aggregate principal amount of $400.0 million. As of September 30, 2012, $275.0 million aggregate principal amount remains outstanding. The Company’s payment obligations under the 9.75% Senior Notes are jointly and severally guaranteed by certain of its 100% owned U.S. subsidiaries (“Guarantor Subsidiaries”). All subsidiaries of the Company that do not guaranty the 9.75% Senior Notes are referred to as Non-Guarantor Subsidiaries.

The consolidating condensed financial statements are presented below and should be read in connection with the Condensed Consolidated Financial Statements of the Company. Separate financial statements of the Guarantor Subsidiaries are not presented because (i) the Guarantor Subsidiaries are wholly-owned and have fully and unconditionally guaranteed the 9.75% Senior Notes on a joint and several basis, and (ii) the Company’s management has determined such separate financial statements are not material to investors.

The following consolidating condensed financial information presents the consolidating condensed balance sheets as of September 30, 2012 and December 31, 2011, and the consolidating condensed statements of operations, statements of comprehensive income and statements of cash flows for the nine months ended September 30, 2012 and September 30, 2011 of (a) the Company; (b) the Guarantor Subsidiaries; (c) the Non-Guarantor Subsidiaries; (d) elimination entries; and (e) the Company, the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries on a consolidated basis.

Investments in subsidiaries are accounted for on the equity method. The principal elimination entries eliminate investments in subsidiaries, intercompany balances, intercompany transactions and intercompany sales.

CONSOLIDATING CONDENSED BALANCE SHEET

As of September 30, 2012

(In thousands)



	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
ASSETS
Cash and cash equivalents	$	—		$	40,986		$	1,833		$	—		$	42,819
Receivables
Trade, net	—			33,256			11,237			—			44,493
Notes and other, net	491			997			2,244			—			3,732
Due from Seitel Holdings, Inc.	—			872			—			—			872
Intercompany receivables (payables)	80,575			(55,308		)	(25,267		)	—			—
Investment in subsidiaries	300,506			427,509			1,481			(729,496		)	—
Net seismic data library	—			88,252			75,800			—			164,052
Net property and equipment	—			2,318			2,820			—			5,138
Prepaid expenses, deferred charges and other	2,966			5,367			877			—			9,210
Intangible assets, net	900			14,053			7,590			—			22,543
Goodwill	—			107,688			101,475			—			209,163
Deferred income taxes	—			56			—			—			56
TOTAL ASSETS	$	385,438		$	666,046		$	180,090		$	(729,496	)	$	502,078
LIABILITIES AND STOCKHOLDER’S EQUITY
Accounts payable and accrued liabilities	$	3,346		$	28,237		$	11,881		$	—		$	43,464
Income taxes payable	596			442			2,765			—			3,803
Senior Notes	275,000			—			—			—			275,000
Notes payable	46			—			—			—			46
Obligations under capital leases	—			89			3,121			—			3,210
Deferred revenue	—			37,449			5,643			—			43,092
Deferred income taxes	—			—			1,499			—			1,499
TOTAL LIABILITIES	278,988			66,217			24,909			—			370,114
STOCKHOLDER’S EQUITY
Common stock	—			—			—			—			—
Additional paid-in capital	398,530			—			—			—			398,530
Parent investment	—			764,752			156,917			(921,669		)	—
Retained deficit	(292,080		)	(164,923		)	(27,250		)	192,173			(292,080		)
Accumulated other comprehensive income	—			—			25,514			—			25,514
TOTAL STOCKHOLDER’S EQUITY	106,450			599,829			155,181			(729,496		)	131,964
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY	$	385,438		$	666,046		$	180,090		$	(729,496	)	$	502,078

CONSOLIDATING CONDENSED BALANCE SHEET

As of December 31, 2011

(In thousands)



	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
ASSETS
Cash and cash equivalents	$	—		$	61,612		$	13,282		$	—		$	74,894
Receivables
Trade, net	—			32,129			19,177			—			51,306
Notes and other, net	520			1,606			2,196			—			4,322
Due from Seitel Holdings, Inc.	—			861			—			—			861
Intercompany receivables (payables)	95,955			(78,614		)	(17,341		)	—			—
Investment in subsidiaries	272,268			416,322			1,448			(690,038		)	—
Net seismic data library	—			63,259			57,435			—			120,694
Net property and equipment	—			1,897			3,142			—			5,039
Investment in marketable securities	—			262			—			—			262
Prepaid expenses, deferred charges and other	4,409			5,078			757			—			10,244
Intangible assets, net	900			16,462			9,452			—			26,814
Goodwill	—			107,688			98,150			—			205,838
Deferred income taxes	—			56			—			—			56
TOTAL ASSETS	$	374,052		$	628,618		$	187,698		$	(690,038	)	$	500,330
LIABILITIES AND STOCKHOLDER’S EQUITY
Accounts payable and accrued liabilities	$	10,050		$	23,563		$	26,937		$	—		$	60,550
Income taxes payable	81			—			1,383			—			1,464
Senior Notes	275,000			—			—			—			275,000
Notes payable	95			—			—			—			95
Obligations under capital leases	—			—			3,161			—			3,161
Deferred revenue	—			33,340			15,505			—			48,845
Deferred income taxes	—			—			1,375			—			1,375
TOTAL LIABILITIES	285,226			56,903			48,361			—			390,490
STOCKHOLDER’S EQUITY
Common stock	—			—			—			—			—
Additional paid-in capital	398,011			—			—			—			398,011
Parent investment	—			764,752			156,913			(921,665		)	—
Retained deficit	(309,185		)	(193,299		)	(38,328		)	231,627			(309,185		)
Accumulated other comprehensive income	—			262			20,752			—			21,014
TOTAL STOCKHOLDER’S EQUITY	88,826			571,715			139,337			(690,038		)	109,840
TOTAL LIABILITIES AND STOCKHOLDER’S EQUITY	$	374,052		$	628,618		$	187,698		$	(690,038	)	$	500,330

CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS

For the Nine Months Ended September 30, 2012

(In thousands)



	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
REVENUE	$	—		$	106,372		$	64,730		$	(971	)	$	170,131
EXPENSES:
Depreciation and amortization	—			64,927			41,997			—			106,924
Cost of sales	—			335			17			—			352
Selling, general and administrative	1,601			12,313			7,699			(971		)	20,642
	1,601			77,575			49,713			(971		)	127,918
INCOME (LOSS) FROM OPERATIONS	(1,601		)	28,797			15,017			—			42,213
Interest expense, net	(9,690		)	(10,995		)	(1,053		)	—			(21,738		)
Foreign currency exchange losses	—			(4		)	1,040			—			1,036
Gain on sale of marketable securities	—			230			—			—			230
Other income	20			690			—			—			710
Income (loss) before income taxes and equity in income of subsidiaries	(11,271		)	18,718			15,004			—			22,451
Provision for income taxes	—			1,420			3,926			—			5,346
Equity in income of subsidiaries	28,376			11,078			—			(39,454		)	—
NET INCOME	$	17,105		$	28,376		$	11,078		$	(39,454	)	$	17,105

CONSOLIDATING CONDENSED STATEMENT OF COMPREHENSIVE INCOME

For the Nine Months Ended September 30, 2012

(In thousands)



	Parent		Guarantor Subsidiaries			Non- Guarantor Subsidiaries		Consolidating Eliminations			Consolidated Total
Net income	$	17,105	$	28,376		$	11,078	$	(39,454	)	$	17,105
Unrealized loss on securities held as available for sale, net of tax:
Unrealized net holding loss arising during the period	—		(32		)	—		—			(32		)
Less: Reclassification adjustment for realized gains included in earnings	—		(230		)	—		—			(230		)
Foreign currency translation adjustments	—		—			4,762		—			4,762
Comprehensive income	$	17,105	$	28,114		$	15,840	$	(39,454	)	$	21,605

CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS

For the Nine Months Ended September 30, 2011

(In thousands)



	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
REVENUE	$	—		$	102,973		$	45,245		$	(969	)	$	147,249
EXPENSES:
Depreciation and amortization	—			64,744			34,968			—			99,712
Cost of sales	—			61			7			—			68
Selling, general and administrative	1,278			14,498			8,320			(969		)	23,127
	1,278			79,303			43,295			(969		)	122,907
INCOME (LOSS) FROM OPERATIONS	(1,278		)	23,670			1,950			—			24,342
Interest expense, net	(12,047		)	(14,972		)	(603		)	—			(27,622		)
Foreign currency exchange gains	—			4			(1,178		)	—			(1,174		)
Loss on early extinguishment of debt	(7,912		)	—			—			—			(7,912		)
Gain on sale of marketable securities	—			2,467			—			—			2,467
Other income	3			27			178			—			208
Income (loss) before income taxes and equity in income of subsidiaries	(21,234		)	11,196			347			—			(9,691		)
Provision (benefit) for income taxes	—			(251		)	186			—			(65		)
Equity in income of subsidiaries	11,608			161			—			(11,769		)	—
NET INCOME (LOSS)	$	(9,626	)	$	11,608		$	161		$	(11,769	)	$	(9,626	)

CONSOLIDATING CONDENSED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

For the Nine Months Ended September 30, 2011

(In thousands)



	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
Net income (loss)	$	(9,626	)	$	11,608		$	161		$	(11,769	)	$	(9,626	)
Unrealized loss on securities held as available for sale, net of tax:
Unrealized net holding loss arising during the period	—			(461		)	—			—			(461		)
Less: Reclassification adjustment for realized gains included in earnings	—			(2,467		)	—			—			(2,467		)
Foreign currency translation adjustments	—			(1		)	(6,068		)	—			(6,069		)
Comprehensive income (loss)	$	(9,626	)	$	8,679		$	(5,907	)	$	(11,769	)	$	(18,623	)

CONSOLIDATING CONDENSED STATEMENT OF CASH FLOWS

For the Nine Months Ended September 30, 2012

(In thousands)



	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Eliminations		Consolidated Total
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	(26,451	)	$	88,015		$	57,238		$	—	$	118,802
Cash flows from investing activities:
Cash invested in seismic data	—			(75,100		)	(73,754		)	—		(148,854		)
Cash paid to acquire property, equipment and other	—			(1,194		)	(82		)	—		(1,276		)
Net proceeds from sale of marketable securities	—			230			—			—		230
Cash from sale of property, equipment and other	—			90			—			—		90
Advances to Seitel Holdings, Inc.	—			(11		)	—			—		(11		)
Net cash used in investing activities	—			(75,985		)	(73,836		)	—		(149,821		)
Cash flows from financing activities:
Principal payments on notes payable	(49		)	—			—			—		(49		)
Principal payments on capital lease obligations	—			(6		)	(144		)	—		(150		)
Intercompany transfers	26,500			(32,650		)	6,150			—		—
Net cash provided by (used in) financing activities	26,451			(32,656		)	6,006			—		(199		)
Effect of exchange rate changes	—			—			(857		)	—		(857		)
Net decrease in cash and cash equivalents	—			(20,626		)	(11,449		)	—		(32,075		)
Cash and cash equivalents at beginning of period	—			61,612			13,282			—		74,894
Cash and cash equivalents at end of period	$	—		$	40,986		$	1,833		$	—	$	42,819

CONSOLIDATING CONDENSED STATEMENT OF CASH FLOWS

For the Nine Months Ended September 30, 2011

(In thousands)



	Parent			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Consolidating Eliminations		Consolidated Total
Cash flows from operating activities:
Net cash provided by (used in) operating activities	$	(38,639	)	$	78,628		$	24,395		$	—	$	64,384
Cash flows from investing activities:
Cash invested in seismic data	—			(57,493		)	(45,219		)	—		(102,712		)
Cash paid to acquire property, equipment and other	—			(1,055		)	(166		)	—		(1,221		)
Net proceeds from sale of marketable securities	—			2,467			—			—		2,467
Cash from sale of property, equipment and other	—			34			1			—		35
Advances to Seitel Holdings, Inc.	—			(752		)	—			—		(752		)
Repayment from Seitel Holdings, Inc.	—			50			—			—		50
Net cash used in investing activities	—			(56,749		)	(45,384		)	—		(102,133		)
Cash flows from financing activities:
Principal payments on notes payable	(44		)	—			—			—		(44		)
Repayment of 9.75% Senior Notes	(131,094		)	—			—			—		(131,094		)
Repayment of 11.75% Senior Notes	(2,000		)	—			—			—		(2,000		)
Principal payments on capital lease obligations	—			—			(122		)	—		(122		)
Borrowings on line of credit	—			—			737			—		737
Payments on line of credit	—			—			(737		)	—		(737		)
Contributed capital	125,000			—			—			—		125,000
Costs of debt and equity transactions	(6,263		)	—			(70		)	—		(6,333		)
Intercompany transfers	53,040			(65,040		)	12,000			—		—
Net cash provided by (used in) financing activities	38,639			(65,040		)	11,808			—		(14,593		)
Effect of exchange rate changes	—			—			978			—		978
Net decrease in cash and cash equivalents	—			(43,161		)	(8,203		)	—		(51,364		)
Cash and cash equivalents at beginning of period	—			75,068			14,903			—		89,971
Cash and cash equivalents at end of period	$	—		$	31,907		$	6,700		$	—	$	38,607