SAEX SAExploration Holdings Inc

☐  Form 10-K     ☐  Form 20-F     ☐  Form 11-K     ☒  Form 10-Q

☐  Form 10-D     ☐  Form N-SAR     ☐  Form N-CSR

The reason described in reasonable detail in Part III of this form could not be eliminated without unreasonable effort or expense;

The subject annual report, semi-annual report, transition report on Form 10-K, Form 20-F, Form 11-K, Form N-SAR or Form N-CSR, or portion thereof, will be filed on or before the fifteenth calendar day following the prescribed due date; or the subject quarterly report or transition report on Form 10-Q or subject distribution report on Form 10-D, or portion thereof, will be filed on or before the fifth calendar day following the prescribed due date; and

The SEC has been conducting an investigation of the Company relating to revenue recognition, accounts receivable, tax credits and additional related matters. The Company has been cooperating, and will continue to cooperate, in good faith with the SEC and has retained legal counsel and an accounting advisor to assist the Company with respect to this matter.

The Board of Directors also established a Special Committee of independent directors to the Company’s investigation and determine and take any actions on behalf of the Company in response to the SEC investigation and the matters related to it.

The Audit Committee of the Board of Directors has also undertaken an assessment of the accuracy of the Company’s historical financial statements and related disclosures that were contained in certain previously filed Annual Reports on Form 10-K and quarterly Reports on Form 10-Q.

On August 14, 2019, the Board of Directors concluded that its previously issued consolidated financial statements and financial information relating to each of the fiscal years ended December 31, 2015, 2016, 2017 and 2018 contained in its Annual Reports on Form 10-K and its condensed consolidated financial statements for the quarters and year-to-date periods ended June 30 and September 30, 2015; March 31, June 30 and September 30, 2016; March 31, June 30 and September 30, 2017; March 31, June 30 and September 30, 2018; and March 31, 2019 (collectively, the “Non-Reliance Periods”), contained material misstatements and should be restated

As a result of the above, the Company has determined that a material weakness exists in the Company’s internal control over financial reporting and that disclosure controls and procedures were ineffective during the Non-Reliance Periods. Accordingly, the Company will restate its disclosures for the affected periods to include the identification of material weaknesses related to its restatement.

Name and telephone number of person to contact in regard to this notification

Have all other periodic reports required under Section 13 or 15(d) of the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of 1940 during the preceding 12 months or for such shorter period that the registrant was required to file such report(s) been filed? If answer is no, identify report(s).    ☒  Yes    ☐  No

Is it anticipated that any significant change in results of operations from the corresponding period for the last fiscal year will be reflected by the earnings statements to be included in the subject report or portion thereof?    ☐  Yes    ☒  No

the outcome of the SEC investigation, which could include sanctions against the Company and its officers and directors, civil lawsuits and criminal penalties;

the impact of the restatement and conclusion of the Company regarding the effectiveness of its internal controls and disclosure controls and procedures, among other things;

the outcome of the Company’s own investigation into the matters summarized in this Form;

additional risks may arise in the process of completing the restatement and related disclosures to be revised;

the possible impact on payments received from the State of Alaska regarding completed tax credits and pending applications;

risks related to a possible delisting from the Nasdaq Capital Market;

risks related to the Company’s debt agreements;

the impact that the disclosure in this Form, as well as possible future filings and disclosures may have on the Company’s business, including customers, employees and others;

the impact of the placement on administrative leave of Mr. Hastings and the termination of Mr. Whiteley, as summarized above;

the time and expense required to complete the restatement, revised disclosures, respond to the SEC and for the Company to complete its own investigation, which expenses are likely to be material and are likely to have a material adverse impact on the Company’s cash balance, cash flow and liquidity; and

other risks described more fully in the Company’s filings with the SEC that relate to matters not covered in this Form.