Jack Lascar - Dennard Rupp Gray & Easterly (DRG&E) Billy F. Mitcham, Jr. - President, Chief Executive Officer, Director Robert P. Capps - Chief Financial Officer, Executive Vice President - Finance, Director

Terese Fabian - Sidoti & Company [Russ Dumont - Midworth Capital] Tamara Manukian - Greenwood Investments Gregg Hillman - First Wilshire Securities Management Scott Lewis - Lewis Capital Management [Joe Hayne - GR&R Fund]

Welcome to the Mitcham Industries third quarter earnings conference call. During today’s presentation all parties will be in a listen-only mode. Following the presentation the conference will be open for questions. (Operator Instructions) This conference is being recorded today, Tuesday, December 9, 2008. At this time I’d like to turn the conference over to Jack Lascar with DRG&E.

Welcome to the Mitcham Industries fiscal 2009 third quarter conference call. We appreciate all of you joining us here today. Your hosts are Bill Mitcham, President and CEO, and Rob Capps, Executive Vice President and CFO. Before I turn the call over to management I would like to cover a couple of items. If you would like to be added to the company’s email distribution list, please call our office at 713-529-6600 and relay that information to us. If you would like to listen to a replay of today’s call, it is available via webcast by going to the Investor Relations section of the company’s website at www.mitchamindustries.com or via recorded instant replay until December 18. Information on how to access the replay was provided in yesterday’s earnings release. Information reported on this call speaks only as of today, Tuesday, December 9, 2008 and therefore you are advised that time sensitive information may no longer be accurate as of the time of any replay. Before we begin let me remind you that certain statements made by management during this call may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations and include known and unknown risks, uncertainties and other factors many of which the company is unable to predict or control that may cause the company’s actual or future results or performance to materially differ from any future results or performance expressed or implied by those statements. These risks and uncertainties include the risk factors disclosed by the company from time to time in its filings with the SEC including in its annual report on Form 10K for the year ended January 31, 2008. Furthermore as we start this call, please also refer to the statement regarding forward-looking statements incorporated in our press release issued yesterday and please note that the content of our conference call this morning are covered by these statements. I would like to turn the call now over to Bill Mitcham. Billy F. Mitcham, Jr.: Thank you for joining us today to discuss our fiscal 2009 third quarter results. I will note some of the highlights of the quarter and then I’ll turn the call over to Rob Capps to discuss the financials. We had another strong performance in our core equipment leasing business. Revenues in our seismic equipment leasing business increased approximately 20% over the last year’s third quarter and rose sequentially 34% over this year’s second quarter. Third quarter EBITDA was strong with a margin of 46%. Net income for the third quarter increased $2.7 million or $0.27 per diluted share from $2.4 million or $0.24 per diluted share in the third quarter of fiscal 2008. We did experience some shipment delays in our Seamap segment during the quarter as we had expected to ship a GunLink 4000 system with a value of approximately $1.5 million in the third quarter and Rob will cover this in more detail in a few minutes. Having said that, our Seamap division was just recently awarded orders totaling about $11 million from Polarcus to provide GunLink 4000 fully distributed digital gun controller systems and BuoyLink RGPS tail buoy positioning systems. This equipment is presently scheduled for delivery in our fiscal year 2010 which is mostly calendar 2009. The recent lease pool additions we discussed in our second quarter call including bore hole tools for vertical seismic profiling, real time frac monitoring and ultra light submersible equipment for seismic recording in the transition zones around the world have helped us diversify and strengthen our global market presence. These systems are presently under contract and contributing to lease and revenue. Finally, approximately 70% of our total revenues for the first nine months of this fiscal year were generated from outside of North America. This is important as we do expect some slowdown in seismic spending in North America and Russia in calendar 2009, fiscal 2010. There are however continued indications of robust exploration activity in other parts of the world. Now I’ll turn the call over to Rob Capps, our Chief Financial Officer, who will give you a detailed review of our financial results. Then I’ll return with some final remarks. Robert P. Capps: As usual I’ll review the third quarter operating results in some detail and then I’ll make a few comments about the balance sheet. Total revenues for the third quarter were $14.5 million compared to $17.2 million a year ago. That’s a decrease of about 16%. Partially accounting for the decline was a drop in Seamap revenues as compared to the third quarter a year ago and I’ll discuss that shortly. As a reminder now, we look at the company in two segments: Equipment leasing and Seamap. The equipment leasing segment includes not only our core leasing but also some equipment sales. Therefore included within this segment are occasional sales of leasable equipment, sales of new seismic equipment made to other manufacturers and sales of our Australia subsidiary SAP hydrographic and oceanographic equipment. The other segment is our Seamap business which of course designs and manufactures the sale of a variety of products for the marine seismic industry. Our core revenues from equipment leasing including the equipment sales increased about 20% in the third quarter to $10 million from $8.4 million a year ago. This was driven by higher demand for seismic equipment, expansion into new geographic markets and expansion of our lease pools. Sales of lease pool equipment for the quarter were $300,000 compared to $1.7 million in last year’s third quarter. As we previously said, the sale of equipment for our lease pool is based on specific customer demand opportunities as they are presented. From time to time we do sell new seismic equipment that we’ve acquired from others and on occasion these sales may be structured with a significant down payment with the balance being financed. Due to the current uncertainty in the energy and global financial markets we’ll be much more stringent in providing financing of these types of transactions going forward. In addition SAP regularly sells new hydrographic and oceanographic equipment to customers in Australia and in the Pacific [inaudible]. Total other equipment sales for the third quarter totaled $1.8 million compared to $2 million a year ago. This represents a decline of the new seismic equipment sales that I alluded to a moment ago. Offsetting this decline to some extent was improvement from SAP. In the third quarter SAP recognized the first [inaudible] contract with the Royal Australian Navy that was awarded [inaudible]. Sales in our Seamap equipment segment declined to $2.4 million from $5.1 million a year ago primarily due to some shipment delays. As Bill said we had expected to ship a GunLink 4000 system with a value of about $1.5 million for the third quarter. However due to delays from a specific supplier we were not able to ship the complete system until this quarter. In addition we experienced a reduction in customer order activity during the quarter which contributed to the decline in equipment sales. However as a result of [inaudible] we currently have a very strong $17 million backlog in Seamap. I also think it’s important to note that we did not lose any significant orders to competitors nor did we see any expected orders for Seamap equipment canceled. The decline in order activity appears to be a result of delays in some customers purchasing decisions due to the challenging economic environment. Gross margin for Seamap equipment sales amounted to approximately $1.3 million or 49% of revenues for the third quarter compared to about $2.1 million or 39% of revenue in the same period last year. This improvement in the gross margin percentage reflects the profitability improvement that we experienced from moving our production facilities to Singapore from the UK and the effect of acquiring GunLink [inaudible] rights last December. Gross profit from our equipment leasing segment decreased by about 8% to $6 million in the third quarter [inaudible] of revenues. This compares to about $7.4 million in the third quarter of last year or 61% of revenues. This gross profit decline despite the higher leasing revenues is due primarily to higher depreciation expense and a lower gross profit from the sale of lease pool equipment. Although despite the higher depreciation charges within the segment the increase in leasing revenues has resulted in overall increasing gross profit for the first time in fiscal 2009. Our overall gross profit for the third quarter decreased to $7.3 million or 50% of revenues compared to $9.3 million or 54% of revenues in the third quarter of last year. As I just mentioned, one of the reasons for the drop in gross margin in the quarter is the increase in depreciation expense which results from the $46 million worth of new equipment we added to our lease pool in fiscal 2008 and fiscal 2009. In this challenging environment we’re making a concentrated effort to reduce our costs as much as possible. General and administrative costs for the third quarter decreased $4.3 million or 30% of revenues versus $5 million or 29% of revenues in the same period last year. This reduction relates primarily to compensation and other employee related costs. Our operating income in the third quarter was $2.7 million or 19% of revenues. That compares to $3.8 million or 22% of revenues a year ago. Net income was $2.7 million or $0.27 per diluted share compared to $2.4 million or $0.24 per diluted share a year ago. This year’s third quarter net income includes the effect of a $900,000 reduction in our income tax expense. This credit to our income tax provision resulted from the elimination of uncertain tax positions upon the expiration of the period in which certain prior periods could be examined by taxing authorities. As a result, we actually had [inaudible]. Without this benefit of this item I just described, our effective tax rate would have been about 32% for the third quarter. Our third quarter EBITDA was $6.8 million or 47% of revenues compared to $6.8 million which was 39% of revenues for the same period last year. Our adjusted EBITDA which excludes stock-based compensation expense was $7.3 million which is 50% of revenues. That compares to $7.4 million or 43% of revenues in the same period last year. Please keep in mind that EBITDA and adjusted EBITDA are not GAAP measures and are reconciled to reported net income in Note A of the financial tables in our earnings release from yesterday. Now let me make just a few comments about our financial position before I turn the call back over to Bill. Mitcham’s overall financial and liquidity positions are very solid. We continue to generate good cash flow from operations. As of October 31 we had working capital of about $18.5 million and net debt of only $2.6 million. We have added about $25 million of new lease pool equipment so far this year and based on our current commitments we expect to add about another $10 million by the [inaudible]. One thing that happened during the quarter is we expanded our working capital facility to $25 million from $12.5 million. We extended the term of the facility until September 2010. We also added a provision to the facility that allows us at any time until the maturity of the facility to convert any or all of the outstanding balance into a series of 48-month amortizing notes. With our strong balance sheet and access to additional capital, we believe that we’re well equipped to deal with the uncertain conditions that [inaudible] exist within the energy industry. That concludes my financial comments. Bill, I’ll turn it back over to you. Billy F. Mitcham, Jr.: Regarding our fiscal 2009 outlook we continue to expect growth in our equipment leasing business. However we no longer expect Seamap revenues to be stronger in the second half than the first due to an increasing difficult economic environment. Therefore given our current pipeline of business, the volatility of the business and the uncertainty surrounding our fiscal year end outlook we are reducing our prior guidance for fiscal 2009. We now expect revenues to range between $67 million and $70 million, operating income to range between $13.3 million and $15.5 million, and earnings per diluted share to range between $0.96 and $1.10. Having said that, we find ourselves in uncharted territory. Rental revenues remain strong but we are cautious about the next several quarters because of a lack of visibility. We expect some softness in North America and Russia as lower commodity prices are resulting in reduced capital expenditures for both contractors and oil and gas companies. However, generally in this cash constrained environment seismic acquisition contractors are more likely to rent equipment to supplement their incremental needs than commit to cash equipment purchases. Renting allows them to use their cash for many other services and products that are not available from short-term rentals. Seamap sales were off but the backlog of this segment is solid, almost at an all-time high. The recent award from Polarcus further substantiates the strength of our product line and reaffirms our position as the market leader. We’re strong financially and well positioned to ride out this period of uncertainty. At some point in the next few quarters commodity prices will rebound because of the tight supply/demand balance. The fundamentals of our industry remain unchanged. This is not the 1980s. The long-term trend regarding the search for hydrocarbons remains the same. It has become more and more challenging and the need for enhanced subservice resolution remains high. As a result our contractor customers must deploy larger quantities of seismic equipment especially channeled to seek new reserves as well as reduce the end users finding and development costs. The cost issue is likely to become more of a challenge for the upstream end users as their cap ex budgets get reduced over the next year or so. We continue to believe we are well positioned due to the broad and increasing range of equipment in our lease pool, our geographic diversity and our focus on customer service. We currently have over 85,000 land channels in our lease pool as well as more than 23 kilometers of marine streamers and associated peripherals such as air guns, compressors and controllers. In this challenging environment when cap ex is a constraint, equipment leasing becomes a real attractive option and we did have that discussion with several of our customers at our annual industry SEG convention in Las Vegas a few weeks ago. Furthermore, our investment in new types of equipment for the bore hole and transition zone continues to pay off and we expect the revenue contribution to have a more significant impact in future periods. We continue to be intrigued by the possibilities offered by these new products and we’re exploring other opportunities with our suppliers and potential customers. That concludes my formal remarks. Hence, we’ll now take some questions.

(Operator Instructions) Our first question comes from Terese Fabian - Sidoti & Company. Terese Fabian - Sidoti & Company: I have a question on the lease revenue part in the third quarter. Can you talk a little bit about the mix? How much came from Russia, and then again what your expectations would be for the fourth quarter in terms of leasing into Canada and Russia? Robert P. Capps: I don’t have that number off the top of my head. The Russian contribution in the third quarter would not have been significant or that large. Several hundred thousand; that magnitude but I don’t know the exact number. I think as Bill said going in to the fourth quarter and the first quarter of next year we think we’ll see some softness and we are seeing some softness in Canada and in Russia. So we think we’ll see again some softness there. Terese Fabian - Sidoti & Company: Do you have a sense when you talk with your customers whether they would be leasing or buying if they had access to credit or is it that they think that the markets just aren’t there for using the equipment? Billy F. Mitcham: I think right now the uncertainty of the situation that they’re more inclined to rent. Some of the jobs in Russia that we have bid have been canceled and some of them have been set back. Generally some of those that started in December are now pushed back to January. In the Canadian market we’ve only seen I think one job cancel although we’ve heard of a number of jobs in the tar sands that were canceled and set back but none of those affected us at this point. Terese Fabian - Sidoti & Company: Another question on your system sale of the GunLink that was delayed to the fourth quarter; how much would that have added to EPS? Robert P. Capps: I’ll let you kind of back into it. It was $1.5 million sale and I guess you can kind of back into looking at their margins.

Our next question comes from [Russ Dumont - Midworth Capital]. [Russ Dumont - Midworth Capital]: A question about cap ex going forward. Obviously you’ve been spending at a pretty good clip here. Do you see over the next quarter and the fiscal year slowing that dramatically and just kind of beginning to generate cash? Billy F. Mitcham, Jr.: I think we certainly would expect to cut back on our cap ex the way we see the market right now. Again we’ve bought a lot this year and when we finish out our acquisition program for the balance of the year, I think as we go into the next fiscal year we’ll certainly have a much lower goal in mind for cap ex. The answer to your question is yes, I think we’ll spend less and that means we’ll generate a lot more cash flow. [Russ Dumont - Midworth Capital]: I just want to make sure I heard you correctly. It sounded like even though there’s some weakness and uncertainty in the leasing business the capital you spent over the last year is sufficient that that will continue to grow and comp up quarter-over-quarter and then Seamap is kind of the ex factor, a little more unknown. Is that a fair statement [inaudible]? Robert P. Capps: I wouldn’t say it quite that strongly. I think we do see growth still in the leasing business but as Bill said there’s a lot of uncertainty right now and if you have one or two jobs canceled, postponed or delayed, it can have a big impact on a quarter. I’m not sure I’m prepared to make quite that strong a statement. I think as far as Seamap we feel really good about where we stand from a base backlog. Again as Bill said, this is a record point. There certainly will be some lumpiness in the quarterly earnings because these are large system deliveries. If you deliver three in one quarter and none in one, obviously there’ll be some big differences. So just how those deliveries will actually fall will have a big impact on what the quarterly comparisons look like.

Our next question comes from Tamara Manukian - Greenwood Investments. Tamara Manukian - Greenwood Investments: In terms of sales in Russia, what percentage of your total sales year-to-date were from Russia or if you can give us the number in dollars? Robert P. Capps: I just don’t have that number off the top of my head as to what that number was. It’s going to be roughly total revenues is going to be less than 10%. Tamara Manukian - Greenwood Investments: How many channels do you plan to allocate to Russia this winter season? Billy F. Mitcham, Jr.: We have in the neighborhood of 17,000 to 18,000 channels in Russia today. That includes I/O MRX, Sercel 388 and Sercel 408. That mix is probably about 10,000 to 12,000 on 408. In the neighborhood of 16,000 to 18,000 channels. We could certainly go up to 20,000 channels if we needed that. I’m not sure that we need that this year. Tamara Manukian - Greenwood Investments: Do you feel like these 17,000 to 18,000 channels will be well utilized during the winter or if you see more slowness over there, would you move this equipment somewhere else? Billy F. Mitcham, Jr.: We certainly see some slowness. I’m not sure that we’ll utilize all of those. Certainly we are prepared to if we need them and we certainly hope so. At this point it doesn’t look that we’re going to need every one of those channels and absolutely if we needed to move some equipment out of that market, we’re prepared to do that for the short term. Tamara Manukian - Greenwood Investments: What about Canada? How many channels did you have in Canada last winter and what do you think you’re going to use this winter? Billy F. Mitcham, Jr.: I’m not quite sure of the exact number of channels we have up there at this time. As I said we move equipment a lot back and forth. We probably have over 20,000 committed for the winter. Tamara Manukian - Greenwood Investments: Is that less than last year? Billy F. Mitcham, Jr.: It’s probably about the same; maybe a little more. Tamara Manukian - Greenwood Investments: So when you were talking about slowness in Canada, you haven’t seen any in terms of your backlog over there or what were you referring to? Billy F. Mitcham, Jr.: Most of the slowness that we’ve seen in the jobs canceled were in the tar sands. As I said we had one job that was associated with that that was canceled. Some of those may not be entirely canceled. They may be pushed back from a January start to February or March. I know some of the programs have been cut in terms of the size of it and it’s been out for rebid. So right now I see only the one job that’s directly affected us.

Our next question comes from Terese Fabian - Sidoti & Company. Terese Fabian - Sidoti & Company: I have a question on the seismic bore hole equipment. Can you tell us how many units you have and what the utilization is on that and what the prospects are for continued use? Billy F. Mitcham, Jr.: We have 150 levels of the [OYO] bore hole system at this point. We’re certainly looking at some other opportunities. All 150 levels of those are on a fairly long-term commitment so we’re certainly happy with that. Again we have some other opportunities that we’re looking at with different types of bore hold equipment. None of that’s come to fruition yet but we expect in the new year that we’ll see some of that. Terese Fabian - Sidoti & Company: And another question on the Polarcus on delivery of Seamap equipment for those units. Was there active bidding going on? I think your price is $11 million for six vessels. Is that for both GunLink and the BuoyLink products? Robert P. Capps: Yes, it is. That’s for six vessels. Terese Fabian - Sidoti & Company: So it’s a little under $2 million per vessel in terms of cost? Robert P. Capps: Yes. Terese Fabian - Sidoti & Company: I’m looking at price competition. Was that delivered at full price or is there a lot of competitive pricing pressure now? Robert P. Capps: I would say it was within a normal discount range. Terese Fabian - Sidoti & Company: The timing is throughout 2009 or towards the end of it, because I think some of the Polarcus vessels are actually being delivered in 2010? Robert P. Capps: The delivery schedule is throughout the year but it doesn’t start until I believe in the second quarter is the first delivery.

Our next question comes from Gregg Hillman - First Wilshire Securities Management. Gregg Hillman - First Wilshire Securities Management: Just one thing about definitions. Is bore hole the same thing as vertical seismic profiling? Billy F. Mitcham, Jr.: Yes. Gregg Hillman - First Wilshire Securities Management: Exactly what is that? Is that used for exploration or is that used in production? Billy F. Mitcham, Jr.: It’s used in both but it’s certainly put into a producing well bore. The vertical seismic profiling can be used for a number of things for reservoir monitoring; you can use it in a lot of [4-D]; you can use it for the acquisition of surface monitoring as well as the bore hole at the same time. It’s also used quite extensively for frac monitoring to put it down the well and understand what’s going on in real time how the formation is acting or is taking to the frac. There’s a number of uses for the bore hole system besides just vertical seismic profiling. Also it’s able to do the frac monitoring and just a number of things. Gregg Hillman - First Wilshire Securities Management: So basically the people are just discovering new applications. It’s an emerging technology. Billy F. Mitcham, Jr.: Yes. That’s correct. Gregg Hillman - First Wilshire Securities Management: This could be like a wild card for you in the future; this particular product? Billy F. Mitcham, Jr.: Certainly we’ve always looked for different applications to enhance our lease pool. This is one that we’ve been looking at for quite some time. I certainly don’t ever see it taking over our entire rental pool but I think it’ll be certainly a nice business for us in the future. Gregg Hillman - First Wilshire Securities Management: The ultra light submersibles; what was that you mentioned in your press release? Billy F. Mitcham, Jr.: We have a lot of land equipment and we have a lot of deep water marine equipment. The ultra light submersible system is a system that’s designed to go out into 50, 60, 70 meters of water along the transition zone that ties the land to the deep water and this system is especially designed for shallow water; not specifically like OBC cable but these are all boxes that are designed to go to certain water depths. Gregg Hillman - First Wilshire Securities Management: Does the weather ever impact your rental activity? I think it’s supposed to be like a cold winter this winter in the northern latitudes. That would I take it be better for drilling? Billy F. Mitcham, Jr.: It’d certainly be better for seismic and weather impacts us everywhere we are in the world. Certainly the colder it is in the Canadian markets and the Russian markets, the easier these guys can get out on the tundra and stuff and work. And we hope we have a very long cold winter. Gregg Hillman - First Wilshire Securities Management: The whole area about oil price prediction; do you use a service to predict oil prices and does that go into your strategic planning? Do you try to do that? Robert P. Capps: There are lots of smarter people than us trying to predict oil prices so we read what everybody else reads as far as the different predictors. We try to factor that in but there’s no particular service we use. You can read the paper every day and get lots of different opinions on that. Gregg Hillman - First Wilshire Securities Management: In your earnings projections does that assume any particular oil price? Robert P. Capps: No, it doesn’t. Gregg Hillman - First Wilshire Securities Management: Generally in the comments you made in the past that basically there’ll be continuing the strong drilling activity if the price of oil remains like $40 to $50 a barrel. Is that still like your rule of thumb? Robert P. Capps: I’m not sure it’s our rule of thumb. Again we look at what other people are saying and what the E&P companies are saying about their exploration budgets because they know better than we do what they’re going to do. We don’t try to look at the price of oil and then predict what they’ll do. We’re more looking at what are they actually doing. Gregg Hillman - First Wilshire Securities Management: Right now I take it obviously we’ve reached a level where oil price is low enough to slow down activity. Is that correct? Robert P. Capps: I think we’re certainly seeing cap ex budgets cut by a lot of the E&P companies. There’s no doubt about that. Gregg Hillman - First Wilshire Securities Management: In your mind is there any price when it starts to predict reduced exploration activity? Robert P. Capps: No, not really. Again that’s their decision. We more look at how they act rather than trying to predict how they’re going to act based on oil prices.

Our next question comes from Tamara Manukian - Greenwood Investments. Tamara Manukian - Greenwood Investments: About new geographic markets, I think Rob mentioned in his prepared remarks that some of the weakness in Russia and North America was offset by entering new geographic markets. I was wondering what markets were you referring to? Billy F. Mitcham, Jr.: I think some of the markets that we’ve seen recently are in the North African market. We’ve become much more active in the South American market. So I think some of that certainly has helped to offset some of these other North American and Russian slowdowns. Tamara Manukian - Greenwood Investments: In terms of your cost structure I was wondering if you see more deterioration on the top line, do you anticipate to take some cuts on your G&A and if so, how much? Have you thought about it? Robert P. Capps: That’s something that we look at all the time. Of course one of our luxuries is that we have a small cost structure so there’s not like we have hundreds and hundreds of people around the world that we could go lay off. We only have maybe 130 people worldwide. But as things do change in different markets, we’ll certainly look at that. We don’t have any targets and I wouldn’t hazard a prediction at this point. Tamara Manukian - Greenwood Investments: I think your equipment leasing costs almost doubled sequentially and year-over-year. I realize that it’s a small number but I was curious if we had some one-time items or if this is the new level? Can you comment on that? Robert P. Capps: Again it’s such a small number I think that the comparisons are kind of dangerous to look at a doubling because about $800,000 is the absolute amount. It’s just a matter of when some shipping costs fall in. From time to time we’ll sublease some particular types of equipment for a particular job and it just happens whenever those things pop in. They tend to be kind of one-off things that pop up from time to time. Tamara Manukian - Greenwood Investments: The last question is about Seamap. Do you anticipate an uptick sequentially in the fourth quarter for Seamap given that we had some delays from October to November? Robert P. Capps: To be clear, do you mean uptick from Q3 or Q4 last year? Tamara Manukian - Greenwood Investments: From Q3 to Q4. Robert P. Capps: Yes, I think we will see some uptick from Q3 to Q4.

Our next question comes from Scott Lewis - Lewis Capital Management. Scott Lewis - Lewis Capital Management: Is there anything that would prevent you guys from doing a significant share repurchase given your generally optimistic outlook for the future and your strong cash flow? Really your per share metrics was all coming out of it? Billy F. Mitcham, Jr.: I don’t think there’s anything that would keep us from it. Certainly it’s something that we talk about in almost all of our meetings and certainly at these levels. On the other hand, you look at a lot of companies that have been very active in share repurchases like Halliburton and a number of other oil service companies that said they’re suspending their repurchases until it becomes a more stable environment. There’s nothing that would prevent us from doing that. We certainly talk about it. Scott Lewis - Lewis Capital Management: Do you have an opportunity to do kind of the opposite of what Halliburton and those guys have done which were to buy a lot of shares when they were expensive and stop buying when they were cheap? You guys weren’t buying any before and now you’ve got a pretty good opportunity. Billy F. Mitcham, Jr.: We agree with that. We certainly do. On the other hand, and not to say we won’t, certainly in these times we believe that cash is king so I think we’ll do the prudent thing with our cash and there are a number of opportunities for us.

Our next question comes from [Joe Hayne - GR&R Fund]. [Joe Hayne - GR&R Fund]: In terms of order push-outs and delays and cancelations that you guys were talking about during third quarter, were there any breakup fees associated with any of those that you mentioned? Robert P. Capps: No. [Joe Hayne - GR&R Fund]: Do you typically ever have breakup fees on contracts with customers that lease your equipment? Robert P. Capps: Let’s be clear. We’re not saying that there were any contracts that were canceled. That’s not what happened. It was just orders that we had. The one order couldn’t be delivered because of a manufacturing issue from a supplier and the others were orders that just didn’t come in the door. So there were no orders canceled. [Joe Hayne - GR&R Fund]: Typically you guys increase your lease pool based upon demand that you receive from your customers. Is that correct? Robert P. Capps: Yes, we try. [Joe Hayne - GR&R Fund]: When you receive this demand and you have the appropriate product for the customer, do you enter into a leasing agreement with them at that time or does it happen upon delivery? What’s the process there? Robert P. Capps: With the customers you mean? [Joe Hayne - GR&R Fund]: Yes. Robert P. Capps: Understand that our lease agreements are short-term rentals; two, three, four, five months. We typically will enter into a master lease agreement with a customer and we’ll have a specific agreement for the particular piece of equipment or pieces of equipment for the period of time. That will be entered into shortly before delivery. It’s not as though we go sign a long-term contract with the customer and then go buy the equipment. That’s not the way the contracts work. [Joe Hayne - GR&R Fund]: Just a little bit of historical data. What did the company pay for Seamap originally? Robert P. Capps: The original purchase price was $6 million plus a $2 million earn-out, so 48 million. [Joe Hayne - GR&R Fund]: When was it purchased? Robert P. Capps: July 2005. [Joe Hayne - GR&R Fund]: Has that been completely paid off already? Robert P. Capps: I’m not sure what you mean by paid off. [Joe Hayne - GR&R Fund]: I mean the $2 million earn-out. Robert P. Capps: Oh yes.

Our next question comes from Terese Fabian - Sidoti & Company. Terese Fabian - Sidoti & Company: On visibility into the marine seismic market, I know you said that the sales of new equipment are slow but what about the rental part of it? Are you seeing pretty good utilization there? Billy F. Mitcham, Jr.: We’re seeing fairly good utilization on our gun controllers and the streamer sections. We just rolled off one job that we’ve got the equipment in right now at Sercel for test and repair, and we’ve got another job to go on as soon as we get it out of there. Our compressor rental has done well in terms of the wide [inaudible] surveys. We have a couple other pretty strong inquiries on some more compressor rental and gun controller rentals. So we don’t see a whole lot of slowdown in terms of the marine side of the business. Terese Fabian - Sidoti & Company: Are you seeing any work going on offshore US; continental shelf on the new areas that are being opened up? Billy F. Mitcham, Jr.: We don’t really know most of the time where they’re going. All we know is they’re going somewhere and it’s wet.

Our next question comes from Gregg Hillman - First Wilshire Securities Management. Gregg Hillman - First Wilshire Securities Management: I had another question on the manufacturing side. Number one, is there more capacity coming on line for manufacturing seismic equipment that’s being absorbed? Are there any new players other than Sercel? And also how long does it take to get delivery from them at this point as opposed to this same point last year? Billy F. Mitcham, Jr.: I think delivery this year is probably about the same as last year in terms of the land equipment. In terms of new players, I don’t see any new players out there right now. Certainly besides Sercel there’s Ion and ARam who are now together. But I don’t think there’s an over capacity. I think there’s still anywhere from 90 to 180 day delivery depending on what exactly you’re looking for. Gregg Hillman - First Wilshire Securities Management: Billy, earlier when you mentioned cash is king and there are a number of opportunities for us, were you referring to acquisitions or what were you referring to when you said a number of opportunities for us? Billy F. Mitcham, Jr.: Opportunities. That’s the best way I can describe that. Certainly there are some opportunities and I don’t think we’re prepared to discuss all those.

At this time there are no further questions. I’d like to turn it back to management for any closing remarks. Billy F. Mitcham, Jr.: Certainly we appreciate you joining us today and all your questions and your interest in Mitcham. We look forward to talking to you on our fourth quarter call.

Ladies and Gentlemen, that does conclude the Mitcham Industries third quarter earnings call. Thank you for your participation. You may now disconnect.