8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Act of 1934

Date of Report (date of earliest event reported):  July 30, 2008  (July 28, 2008)

GEOKINETICS INC.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization) 001-33460 (Commission File Number) 94-1690082 (I.R.S. Employer Identification Number)

1500 CityWest Blvd., Suite 800

Houston, Texas 77042

 (Address of principal executive offices)

(713) 850-7600

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of theregistrant under any of the following provisions:

  oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

  oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

  oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

  oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Form 8-K filed July 30, 2008 

Item 1.01 Entry into a Material Definitive Agreement.

Agreement to Sell Preferred Stock and Warrants

On July 28, 2008, Geokinetics Inc. ("Geokinetics") entered into (i) a Series B-2 and Warrant Purchase Agreement (the "Series B-2 Purchase Agreement") and (ii) an Amended and Restated Registration Rights Agreement (the "2008 Registration Rights Agreement") with Avista Capital Partners, L.P. and Avista Capital Partners (Offshore), L.P. (the "Series B-2 Purchasers").

At closing (which occurred on July 28, 2008), pursuant to the terms of the Series B-2 Purchase Agreement and for an aggregate consideration of $30,000,000, Geokinetics sold to the Series B-2 Purchasers (i) an aggregate of 120,000 shares of its Series B-2 Senior Convertible Preferred Stock, $10.00 par value ("Series B-2 Preferred Stock") and (ii) five-year warrants ("2008 Warrants") to purchase up to an aggregate of 240,000 shares of the Geokinetics' common stock, par value $0.01 per share ("Common Stock"), at an exercise price of $20.00 per share.

Pursuant to the 2008 Registration Rights Agreement, Geokinetics granted the Series B-2 Purchasers certain demand and piggyback registration rights with respect to the shares of Common Stock into which the Series B-2 Preferred Stock is convertible.  The 2008 Registration Rights Agreement amends and restates the Registration Rights Agreement dated as of September 8, 2006 ("2006 Registration Rights Agreement"), covering certain shares of Geokinetics' Series B-1 Convertible Preferred Stock sold pursuant to that certain Securities Purchase Agreement, dated as of September 8, 2006, among Geokinetics and the Purchasers named therein (the "Series B-1 Purchase Agreement").  All shares of the Company's Series B Senior Convertible Preferred Stock (including both Series B-1 Preferred Stock and Series B-2 Preferred Stock), are now subject to the provisions of the 2008 Registration Rights Agreement.

Geokinetics intends to use the proceeds from the sale of Series B-2 Preferred Stock, as well as any proceeds from the exercise of the 2008 Warrants, for general corporate purposes and additional working capital.

The foregoing description is a summary of the material terms of the Series B-2 Purchase Agreement, the 2008 Registration Rights Agreement, and the 2008 Warrants; it does not purport to be complete, and is qualified in its entirety by reference to the Series B-2 Purchase Agreement, the 2008 Registration Rights Agreement and the 2008 Warrants, copies of which are attached to this Form 8-K as Exhibits 10.3, 10.4, 10.5 and 10.6, respectively.

Item 3.02 Unregistered Sales of Equity Securities.

(a)           Securities Sold

(i)           On November 30, 2005, Geokinetics issued 20,120,000 shares of Common Stock (pre-reverse split) and issued five-year warrants to purchase an aggregate of 2,012,000 additional shares of Common Stock (pre-reverse split) at a price of $2.00 per share.

(ii)          On December 9, 2005, Geokinetics issued an additional 4,550,000 shares of Common Stock (pre-reverse split) and issued five-year warrants to purchase an additional 455,000 shares of Common Stock (pre-reverse split).

(iii)         On December 15, 2006, Geokinetics issued 220,000 shares of Series B-1 Preferred Stock.

Form 8-K filed July 30, 2008 

(iv)           As described in Item 1.01, of this Current Report on Form 8-K, on July 28, 2008, Geokinetics issued 120,000 shares of Series B-2 Preferred Stock and 2008 Warrants to purchase up to an aggregate of 240,000 shares of Common Stock.

(c)           Consideration

(i)           The aggregate offering price of the Common Stock and warrants issued on November 30, 2005 was $25,150,000.

(ii)           The aggregate offering price of the Common Stock and warrants issued on December 9, 2005 was $5,687,500.

(iii)          On December 9, 2005, Geokinetics issued to RBC Capital Markets Corporation and other holders five-year warrants to purchase up to 2,741,050 shares of Common Stock (pre-reverse split), in connection with the November 30, 2005 and the December 9, 2005 issuances of Common Stock and warrants.

(iv)         The aggregate offering price of the Series B-1 Preferred Stock issued on December 15, 2006 was $55,000,000.

(v)          The aggregate offering price of the Series B-2 Preferred Stock and 2008 Warrants sold on July 28, 2008 was $30,000,000.

(d)           Exemption From Registration Claimed

The Common Stock and warrants issued on November 30, 2005 and December 9, 2005, Series B-1 Preferred Stock issued on December 15, 2006 and Series B-2 Preferred Stock and 2008 Warrants issued on July 28, 2008 were issued pursuant to the exemption from registration provided by Section 4(2) and Rule 506 of Regulation D of the Securities Act of 1933, as amended (the "Securities Act"). Each of the purchasers represented to Geokinetics that such person or entity was an “accredited investor” as defined in Regulation D under the Securities Act and that the securities were acquired for such investor’s own account and without a view to the distribution of such securities.

(e)           Terms of Conversion or Exercise

(i)           The warrants issued on November 30, 2005 and December 9, 2005 may be exercised, at the option of the holder, in whole or in part and at any time from and after the date of issuance until the fifth anniversary of the date of issuance, at an exercise price per share of Common Stock equal to $2.00, subject to adjustment as described in the warrants.

(ii)          Each share of Series B-1 Preferred Stock and Series B-2 Preferred Stock (collectively, "Series B Preferred Stock") is initially convertible into 10 shares of Common Stock at the option of the holder. The number of shares of Common Stock into which each share of Series B Preferred Stock can be converted is subject to adjustment, from time to time, on the terms described in the Amended Certificate of Designation of Series B Senior Convertible Preferred Stock with the Secretary of State of Delaware, filed on July 28, 2008.

Form 8-K filed July 30, 2008 

(iii)           At the option of Geokinetics, each share of Series B Preferred Stock is convertible into shares of Common Stock, immediately upon the sale of Common Stock in an underwritten public offering pursuant to an effective registration statement under the Securities Act at a price per share yielding net proceeds to Geokinetics of not less then $35.00 per share, and providing net proceeds to Geokinetics and the selling stockholders, if any, of not less than $75,000,000.

(iv)           The 2008 Warrants may be exercised, at the option of the holder thereof, in whole or in part and at any time from and after July 28, 2008, at an exercise price per share of Common Stock equal to $20.00, subject to adjustment as described in the 2008 Warrants, copies of which are attached to this Form 8-K as Exhibit 10.5 and 10.6.

The foregoing description is a summary of the material terms of the warrants issued on November 30, 2005 and December 9, 2005, the Series B-1 Purchase Agreement, 2006 Registration Rights Agreement, Series B-2 Purchase Agreement, the 2008 Registration Rights Agreement and the 2008 Warrants, it does not purport to be complete, and is qualified in its entirety by reference to the warrants issued on November 30, 2005 and December 9, 2005, and to the Series B-1 Purchase Agreement, 2006 Registration Rights Agreement, Series B-2 Purchase Agreement, the 2008 Registration Rights Agreement and the 2008 Warrants, copies of which are attached to the Form 8-K filed on September 14, 2006 as Exhibits 10.1 and 10.2 and this Form 8-K as Exhibits 10.3, 10.4, 10.5 and 10.6, respectively.

Item 5.03 Amendments to Articles of Incorporation.

On July 28, 2008, Geokinetics filed an Amended Certificate of Designation of Series B Senior Convertible Preferred Stock with the Secretary of State of Delaware in order to (i) re-designate the Series B Senior Convertible Preferred Stock of the Corporation as Series B-1 Senior Convertible Preferred Stock (the "Series B-1 Preferred Stock") and (ii) establish a new series of Series B Senior Convertible Preferred Stock, $10.00 par value per share, consisting of 350,000 shares and designated as Series B-2 Senior Convertible Preferred Stock (the "Series B-2 Preferred Stock").  Pursuant to the terms of the Series B-2 Purchase Agreement described under Item 1.01 above, Geokinetics issued an aggregate of 120,000 shares of Series B-2 Preferred Stock to the Series B-2 Purchasers on July 28, 2008.  A copy of the Amended Certificate of Designation of Series B Senior Convertible Preferred Stock filed with the Secretary of State of Delaware on July 28, 2008, is filed as Exhibit 4.1 to this Form 8-K.

Item 9.01 Financial Statements and Exhibits.

(a)   Exhibits

4.1 Amended Certificate of Designation of Series B Senior Convertible Preferred Stock as filed with the Secretary of State of Delaware on July 28, 2008.

10.1 Securities Purchase Agreement (without exhibits), dated September 8, 2006, by and among Geokinetics Inc. and the purchasers named therein (incorporated by reference from Exhibit 10.1 to Form 8-K filed on September 14, 2006 (file no. 000-09268)).

Form 8-K filed July 30, 2008 

10.2 Registration Rights Agreement, dated September 8, 2006, by and among Geokinetics Inc. and the holders named therein (incorporated by reference from Exhibit 10.2 to Form 8-K filed on September 14, 2006 (file no. 000-09268)).

10.3 Series B-2 and Warrant Purchase Agreement, dated July 28, 2008, by and among Geokinetics Inc. and the purchasers named therein.

10.4 Amended and Restated Registration Rights Agreement, dated July 28, 2008, by and among Geokinetics Inc. and the holders named therein.

10.5 Warrant, dated July 28, 2008, issued by Geokinetics Inc. to Avista Capital Partners, L.P.

10.6 Warrant, dated July 28, 2008, issued by Geokinetics Inc. to Avista Capital Partners (Offshore), L.P.

99.1 Press Release dated July 28, 2008, "Geokinetics Raises $30 Million from Sale of Additional Preferred Stock."

Form 8-K filed July 30, 2008 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

GEOKINETICS INC.

Date:   July 30, 2008	By:	/s/ Scott A. McCurdy
		Scott A. McCurdy, Vice President and Chief Financial Officer

EX-4.1

Exhibit 4.1

AMENDED

CERTIFICATE OF DESIGNATION OF

SERIES B SENIOR CONVERTIBLE PREFERRED STOCK

OF

GEOKINETICS INC.

PURSUANT TO SECTION 151(g) OF THE

GENERAL CORPORATION LAW OF THE STATE OF DELAWARE

Geokinetics Inc (the “Corporation”), a corporation organized and existing under the laws of the State of Delaware, hereby certifies that:

ONE:                      The Certificate of Designation of Series B Senior Convertible Preferred Stock of the Corporation was filed with the Secretary of State of the State of Delaware on September 8, 2006.

TWO:                     Pursuant to the authority expressly granted to and vested in the Board of Directors of the Corporation by Article FOURTH of the Corporation’s Certificate of Incorporation (the “Certificate of Incorporation”), the Board of Directors for the Corporation, by unanimous written consent dated as of July 25, 2008, duly adopted a resolution providing: (i) the Series B Senior Convertible Preferred Stock of the Corporation be designated Series B-1 Senior Convertible Preferred Stock (the “Series B-1 Preferred Stock”) and (ii) a new series of preferred stock of the Corporation, par value $10.00 per share, be created out of the authorized but unissued shares of capital stock of the Corporation and be authorized to be issued, with such series to be designated Series B-2 Senior Convertible Preferred Stock (the “Series B-2 Preferred Stock”), and consist of 350,000 shares, par value $10.00 per share, of which the powers, preferences and relative, participating, optional and other rights, and the qualifications, limitations, and restrictions of the Series B-1 Preferred Stock and the Series B-2 Preferred Stock (collectively, (the “Series B Preferred Stock”), shall be, in addition to those set forth in the Corporation’s Certificate of Incorporation, all in accordance with the provisions of Section 151(g) of the General Corporation Law of the State of Delaware, as set forth herein.

THREE:                 The Certificate of Designation of Series B Senior Convertible Preferred Stock of this Corporation is hereby amended in its entirety as follows:

(1)Series B Preferred Stock.

(a)Dividends.

(i)The holders of Series B Preferred Stock, prior and in preference to any declaration or payment of any dividend on any class or series of capital stock of this Corporation, shall be entitled to receive cumulative dividends at the applicable Dividend Rate (as

Exhibit 4.1

(ii)defined below).  For purposes of this Section 1(a)(i), “Dividend Rate” shall mean 8.0% per annum, compounded quarterly, of the Original Issue Price (defined in Section 1(b)(i) below) for each share of Series B Preferred Stock.  At the option of the Corporation, dividends payable on shares of (A) Series B-1 Preferred Stock on any quarterly dividend payment date through and including October 31, 2011, may be paid in additional shares of Series B-1 Preferred Stock, instead of cash or (B) Series B-2 Preferred Stock on any quarterly dividend payment date through and including October 31, 2011, may be paid in additional shares of Series B-2 Preferred Stock, instead of cash.  The value of each share of Series B Preferred Stock paid in lieu of cash shall be equal to the Original Issue Price.  After October 31, 2011, all dividends shall be paid in cash when, and if declared. All unpaid dividends on Series B Preferred Stock shall be cumulative and shall accrue, compounding annually, regardless of whether or not the Corporation shall have funds legally available for the payment of such dividends.

(iii)After payment of the dividends provided for in Section 1(a)(i), any additional dividends or distributions shall be distributed among all holders of Common Stock, Series B-1 Preferred Stock, Series B-2 Preferred Stock and other preferred securities, which are convertible into shares of Common Stock, in proportion to the number of shares of Common Stock that would be held by each such holder if all shares of Series B-1 Preferred Stock, Series B-2 Preferred Stock and other preferred securities were converted to Common Stock at the then-effective conversion rate.

(b)Liquidation Preference.

(i)The holders of Series B Preferred Stock, in the event of any Liquidation Event (as defined below), either voluntary or involuntary, shall be entitled to receive, prior and in preference to the distribution of any proceeds of such Liquidation Event (the “Proceeds”) to the holders of Common Stock and other preferred securities (but pari passu to any other holder of Series B Preferred Stock), an amount per share (the “Liquidation Preference Amount”) equal to (A) the sum of the Original Issue Price (as defined below) for the Series B Preferred Stock, plus (B) any accrued but unpaid dividends, which have been accrued to the date of payment. In case the net assets of the Corporation legally available therefor are insufficient to permit the payment upon all outstanding shares of Series B Preferred Stock of the full preferential amount to which the holders of such shares are entitled, then such net assets shall be distributed ratably upon outstanding shares of Series B Preferred Stock in proportion to the full preferential amount to which each such share is entitled. For purposes hereof, “Original Issue Price” shall mean $250.00 per share for each share of Series B Preferred Stock (as adjusted for any stock splits, stock dividends, combinations, subdivisions, recapitalizations or the like with respect to the Series B Preferred Stock).

(ii)After the payment of the Liquidation Preference Amount with respect to each share of Series B Preferred Stock, the holders of Series B Preferred Stock will have the right following a Liquidation Event to receive an additional distribution for each share of Series B Preferred Stock equal to the excess, if any, of (i) the aggregate amount distributable with respect to each share of Common Stock following the Liquidation Event multiplied times the number of shares of Common Stock into which each share of Series B Preferred Stock is convertible at the conversion rate effective at the time of the Liquidation Event over (ii) the Liquidation Preference Amount.  As a result, the total amount distributed with respect to each

Exhibit 4.1

(iii)share of Series B Preferred Stock following a Liquidation Event will be not less than the amount determined as if all shares of Series B Preferred Stock had been converted to Common Stock at the conversion rate applicable at the time of the Liquidation Event.  In view of this additional distribution right, the Corporation and the holders of the Series B Preferred Stock expect that the Series B Preferred Stock will not be treated as "preferred stock" for federal income tax purposes under Treasury Regulation § 1.305-5(a).

(iv)For purposes of this Section 1(b), a “Liquidation Event” shall include (A) the sale, transfer or other disposition of all or substantially all of the Corporation’s assets, (B) the merger or consolidation of the Corporation with or into another entity (except a merger or consolidation in which the holders of capital stock of the Corporation immediately prior to such merger or consolidation continue to hold at least 50% of the voting power of the capital stock of the Corporation or the surviving or acquiring entity), (C) the transfer (whether by merger, consolidation, exchange, reorganization or otherwise), in one transaction or a series of related transactions, to a person or group of affiliated persons (other than Avista Capital Partners, L.P. and its affiliates), of the Corporation’s equity securities if, after such transfer, such person or group of affiliated persons would hold 50% or more of the outstanding voting stock of the Corporation (or the surviving or acquiring entity) or (D) a liquidation, dissolution or winding up of the Corporation; provided, however, that a transaction shall not constitute a Liquidation Event if its sole purpose is to change the state of the Corporation’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Corporation’s securities immediately prior to such transaction. The treatment of any particular transaction or series of related transactions as a Liquidation Event hereunder may be waived by the vote or written consent of the holders of a majority of the outstanding Series B Preferred Stock (voting on an as converted basis).

(v)In any Liquidation Event, if Proceeds received by the Corporation or its stockholders are other than cash, their value will be deemed their fair market value. The determination of such fair market value shall be made by the Board of Directors of the Corporation or as otherwise may be set forth in the definitive agreements governing such Liquidation Event.

(c)Redemption Rights.

(i)If, at any time after March 31, 2014, the holders of not less than a majority of the shares of Series B-1 Preferred Stock then outstanding deliver written notice to the Corporation of such holders’ desire to have the Series B-1 Preferred Stock redeemed, all outstanding shares of Series B-1 Preferred Stock, if not previously converted pursuant to Section 1(d), shall be redeemed by the Corporation on a date which is not more than 90 days after the date on which such written notice was given to the Corporation by the holders of the Series B-1 Preferred Stock.  If, at any time after March 31, 2014, the holders of not less than a majority of the shares of Series B-2 Preferred Stock then outstanding deliver written notice to the Corporation of such holders’ desire to have the Series B-2 Preferred Stock redeemed, all outstanding shares of Series B-2 Preferred Stock, if not previously converted pursuant to Section 1(d), shall be redeemed by the Corporation on a date which is not more than 90 days after the date on which such written notice was given to the Corporation by the holders of the Series B-2 Preferred Stock. Each share of Series B Preferred Stock to be redeemed hereunder shall be

Exhibit 4.1

(ii)redeemed by payment by the Corporation in cash of the Redemption Price (as defined below). For purposes hereof, the term “Redemption Price” shall mean, with respect to each share of Series B Preferred Stock, an amount equal to the Liquidation Preference Amount.

(iii)Any redemption pursuant to Sections 1(c)(i) above shall be preceded by written notice from the Corporation to each holder of Series B-1 Preferred Stock or Series B-2 Preferred Stock, as the case may be, stating the date fixed for redemption, the Redemption Price and the place at which holders of Series B-1 Preferred Stock or Series B-2 Preferred Stock, as the case may be, may obtain payment of the Redemption Price upon surrender of their respective stock certificates.

(iv)All shares of Series B Preferred Stock redeemed, otherwise acquired or returned (as a result of conversion or otherwise) by the Corporation shall immediately be canceled and shall not be reissued.

(d)Conversion. The holders of the Series B Preferred Stock shall have conversion rights as follows (the “Conversion Rights”):

(i)Right to Convert. Each share of Series B Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for such stock, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing the Liquidation Preference Amount for the Series B Preferred Stock by the applicable Conversion Price (as defined below) for the Series B Preferred Stock (the conversion rate for Series B Preferred Stock into Common Stock is referred to herein as the “Conversion Rate”), determined as hereafter provided, in effect on the date the certificate is surrendered for conversion. The “Conversion Price” per share for Series B Preferred Stock shall initially be $25.00 (which amount takes into account the 1-for-10 stock split of the Corporation effective as of November 3, 2006); provided, however, that the Conversion Price for the Series B Preferred Stock shall be subject to adjustment as set forth in subsection 1(e)(iv).

(ii)Corporation Conversion Election. At the election of the Corporation, each share of Series B Preferred Stock shall be converted into shares of Common Stock at the Conversion Rate at the time in effect for Series B Preferred Stock immediately upon the Corporation’s sale of its Common Stock in an underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), covering the offer and sale of Common Stock (A) at a price per share yielding net proceeds to the Corporation of not less than $35.00 (as adjusted for any stock splits, stock dividends, combinations, subdivisions or the like), (B) which results in net proceeds to the Corporation and the selling stockholders, if any, of not less than $75,000,000, and (C) after which the Common Stock is listed on the NYSE, AMEX or the NASDAQ National Market (a “Qualified Public Offering”).

(iii)Mechanics of Conversion. Before any holder of Series B Preferred Stock shall be entitled to voluntarily convert the same into shares of Common Stock, such holder shall surrender the certificate or certificates therefore, duly endorsed, at the office of the

Exhibit 4.1

(iv)Corporation or of any transfer agent for the Series B Preferred Stock, and shall give written notice to the Corporation at its principal corporate office, of the election to convert the same and shall state therein the name or names in which the certificate or certificates for shares of Common Stock are to be issued. The Corporation shall, as soon as practicable thereafter, issue and deliver at such office to such holder of Series B Preferred Stock, or to the nominee or nominees of such holder, a certificate or certificates for the number of shares of Common Stock to which such holder shall be entitled as aforesaid. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of such surrender of the shares of Series B Preferred Stock to be converted, and the person or persons entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock as of such date. If the conversion is in connection with an underwritten offering of securities registered pursuant to the Securities Act of 1933, as amended, the conversion may, at the option of any holder tendering Series B Preferred Stock for conversion, be conditioned upon the closing with the underwriters of the sale of securities pursuant to such offering, in which event the persons entitled to receive the Common Stock upon conversion of the Series B Preferred Stock shall not be deemed to have converted such Series B Preferred Stock until immediately prior to the closing of such sale of securities. If the conversion is in connection with automatic conversion provisions of subsection 1(d)(ii) above, such conversion shall be deemed to have been made on the conversion date described in the stockholder consent approving such conversion, and the persons entitled to receive shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holders of such shares of Common Stock as of such date.

(v)Conversion Price Adjustments of Series B Preferred Stock for Certain Dilutive Issuances, Splits and Combinations. The Conversion Price of the Series B Preferred Stock shall be subject to adjustment from time to time as follows:

(A)Conversion Price Adjustments.

1.If the Corporation shall issue, on or after the date upon which this Amended Certificate of Designation is accepted for filing by the Secretary of State of the State of Delaware (the “Filing Date”), any Additional Stock (as defined below) for a consideration per share less than the Conversion Price applicable to the Series B Preferred Stock in effect immediately prior to the issuance of such Additional Stock, and if the aggregate dollar amount of all previous issuances of Additional Stock since the Filing Date is less than $50,000,000 (determined by aggregating all previous issuances of Additional Stock made after the Filing Date) the Conversion Price for the Series B Preferred Stock in effect immediately prior to each such issuance shall forthwith be adjusted to a price equal to the per share consideration paid or given for such Additional Stock; provided, however, if the Corporation shall issue, on or after the Filing Date, any Additional Stock after the aggregate amount of previous issuances made after the Filing Date are in excess of $50,000,000 (determined by aggregating all previous issuances of Additional Stock made after the Filing Date) for a consideration per share less than the Conversion Price applicable to the Series B Preferred Stock in effect immediately prior to the issuance of such Additional Stock, the Conversion Price for the Series B Preferred Stock in effect immediately prior to each such issuance shall forthwith be adjusted to a price determined by multiplying such Conversion Price by a fraction, the numerator of which shall be the number of shares of Common Stock

Exhibit 4.1

2.Outstanding (as defined below) immediately prior to such issuance plus the number of shares of Common Stock that the aggregate consideration received by the Corporation for such issuance would purchase at such Conversion Price; and the denominator of which shall be the number of shares of Common Stock Outstanding (as defined below) immediately prior to such issuance plus the number of shares of such Additional Stock.  For purposes of this Section 1(d)(iv)(A), the term “Common Stock Outstanding” shall mean and include the following: (1) outstanding Common Stock, (2) Common Stock issuable upon exercise of outstanding stock options, (3) Common Stock issuable upon exercise of outstanding warrants to purchase Common Stock, (4) Common Stock issuable upon conversion of the Series B Preferred Stock, and (5) Common Stock issuable upon the conversion of any other series or class of equity securities issued after the date hereof which is convertible into shares of Common Stock.  Shares described in (1) through (3) above shall be included whether vested or unvested, whether contingent or non-contingent and whether exercisable or not yet exercisable.

3.No adjustment of the Conversion Price for the Series B Preferred Stock shall be made in an amount less than one cent per share, provided that any adjustments that are not required to be made by reason of this sentence shall be carried forward and shall be either taken into account in any subsequent adjustment made prior to three (3) years from the date of the event giving rise to the adjustment being carried forward, or shall be made at the end of three (3) years from the date of the event giving rise to the adjustment being carried forward. Except to the limited extent provided for in subsections 1(d)(iv)(A)(5)(c) and (5)(d), no adjustment of such Conversion Price pursuant to this subsection 1(d)(iv) shall have the effect of increasing the Conversion Price above the Conversion Price in effect immediately prior to such adjustment.

4.In the case of the issuance of Additional Stock for cash, the consideration shall be deemed to be the amount of cash paid therefore before deducting any reasonable discounts, commission or other expenses allowed, paid or incurred by this corporation for any underwriting or otherwise in connection with the issuance and sale thereof.

5.In the case of the issuance of the Additional Stock for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the fair market thereof as determined by the Board of Directors irrespective of any accounting treatment.

6.In the case of the issuance of options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock or options to purchase or rights to subscribe for such convertible or exchangeable securities, the following provisions shall apply for purposes of determining the number of shares of Additional Stock issued and the consideration paid therefor:

a.The aggregate maximum number of shares of Common Stock deliverable upon exercise (assuming the satisfaction of any conditions to exercisability, including without limitation, the passage of time, but without taking into account potential antidilution adjustments) of such options to purchase or rights to subscribe for Common Stock shall be deemed to have been issued at the time such options or rights were issued and for a consideration equal to the consideration (determined in the manner provided in subsections 1(d)(iv)(A)(3) and

Exhibit 4.1

b.(d)(iv)(A)(4)), if any, received by the Corporation upon the issuance of such options or rights plus the minimum exercise price provided in such options or rights (without taking into account potential antidilution adjustments) for the Common Stock covered thereby.

c.The aggregate maximum number of shares of Common Stock deliverable upon conversion or, or in exchange (assuming the satisfaction of any conditions to convertibility or exchangeability, including, without limitation, the passage of time, but without taking into account potential antidilution adjustments) for, any such convertible or exchangeable securities or upon the exercise of options to purchase or rights to subscribe for such convertible or exchangeable securities and subsequent conversion or exchange thereof shall be deemed to have been issued at the time such securities were issued or such options or rights were issued and for a consideration equal to the consideration, if any, received by the Corporation for any such securities and related options or rights (excluding any cash received on account of accrued interest or accrued dividends), plus the minimum additional consideration, if any, to be received by the Corporation (without taking into account potential antidilution adjustments) upon the conversion or exchange of such securities or the exercise of any related options or rights (the consideration in each case to be determined in the manner provided in subsections 1(d)(iv)(A)(3) and 1(d)(iv)(A)(4).

d.In the event of any change in the number of shares of Common Stock deliverable or in the consideration payable to the Corporation upon exercise of such options or rights or upon conversion of or in exchange for such convertible or exchangeable shares, the Conversion Price of the Series B Preferred Stock, to the extent in any way affected by or computed using such options, rights or securities, shall be recomputed to reflect such change, but no further adjustment shall be made for the actual issuance of Common Stock or any payment of such consideration upon the exercise of any such options or rights or the conversion or exchange of such securities.

e.The number of shares of Additional Stock deemed issued and the consideration deemed paid therefor pursuant to subsections 1(d)(iv)(A)(5)(a) and (b) shall be appropriately adjusted to reflect any change, termination or expiration of the type described in either subsection 1(d)(iv)(A)(5)(a) or (b).

(B)“Additional Stock” shall mean any shares of Common Stock issued (or deemed to have been issued pursuant to subsection 1(d)(iv)(A)(5)) by the Corporation on or after the Filing Date other than:

1.Shares of Common Stock issued to employees, directors, officers, consultants and other service providers for the primary purpose of soliciting or retaining their services pursuant to plans or agreements approved by this corporation’s Board of Directors;

2.Common Stock issued pursuant to the conversion or exercise of convertible or exercisable securities outstanding on the Filing Date;

3.Common Stock or other securities convertible into shares of Common Stock that are issued with the approval of the holders of not less than a majority of the then-outstanding

Exhibit 4.1

4.shares of Series B-1 Preferred Stock and a majority of the then-outstanding shares of Series B-2 Preferred Stock; and

5.Common Stock issued pursuant to the conversion of the Series B Preferred Stock.

(vi)In the event the Corporation should at any time or from time to time after the Filing Date fix a record date for the effectuation of a split or subdivision of the outstanding shares of Common Stock or the determination of holders of Common Stock entitled to receive a dividend or other distribution payable in additional shares of Common Stock or other securities or rights convertible into, or entitling the holder thereof to receive directly or indirectly, additional shares of Common Stock (hereinafter referred to as “Common Stock Equivalents”) without payment of any consideration by such holder for the additional shares of Common Stock or the Common Stock Equivalents (including the additional shares of Common Stock issuable upon conversion or exercise thereof), then, as of such record date (or the date of such dividend distribution, split or subdivision if no record date is fixed), the Conversion Price of the Series B Preferred Stock shall be appropriately decreased so that the number of shares of Common Stock issuable on conversion of each share of such series shall be increased in proportion to such increase of the aggregate of shares of Common Stock outstanding and those issuable with respect to such Common Stock Equivalents.

If the number of shares of Common Stock outstanding at any time after the Filing Date is decreased by a combination of the outstanding shares of Common Stock, then, following the record date of such combination, the Conversion Price for the Series B Preferred Stock shall be appropriately increased so that the number of shares of Common Stock issuable on conversion of each share of such series shall be decreased in proportion to such decrease in outstanding shares.

(vii)Reservation of Common Stock. The Corporation shall reserve and keep available out of its authorized but unissued Common Stock that number of shares of Common Stock as shall from time to time be sufficient to effect the full conversion of all outstanding shares of Series B Preferred Stock.

(e)Election and Removal of Directors by Series B Preferred Stock.  Subject to Section 1(f)(ii), the holders of record of the shares of Series B Preferred Stock, exclusively, shall be entitled to nominate and elect one (1) director of the Corporation (the “Series B Director”).  At each regularly scheduled meeting of the Corporation's stockholders which is called for the purpose of electing members of the Board of Directors, the presence in person or by proxy of the holders of a majority of the shares of Series B Preferred Stock then outstanding shall constitute a quorum of the Series B Preferred Stock for the purpose of electing the director by holders of the Series B Preferred Stock.  A vacancy in said directorship filled by the holders of Series B Preferred Stock shall be filled only by vote or written consent in lieu of a meeting of the holders of the Series B Preferred Stock.  The Series B Director may be removed, with our without cause, by the holders of Series B Preferred Stock in the same manner as such director may be elected hereunder.

(f)Voting Rights.

Exhibit 4.1

(g)Except as otherwise expressly provided herein or as required by law, the holders of Series B Preferred Stock shall be entitled to vote on all matters upon which holders of Common Stock have the right to vote and, with respect to such right to vote, shall be entitled to notice of any stockholders’ meeting in accordance with the Corporation’s Bylaws, and shall be entitled to a number of votes equal to the number of shares of Common Stock into which such shares of Series B Preferred Stock could then be converted, at the record date for the determination of stockholders entitled to vote on such matters or, if no such record date is established, at the date such vote is taken or any written consent of stockholders is solicited. Except as otherwise expressly provided herein, or to the extent class or series voting is otherwise required by law or agreement, the holders of Series B Preferred Stock or Common Stock shall vote together as a single class and not as separate classes.

(i)So long as at least 125,000 shares of Series B Preferred Stock remain outstanding, the Corporation shall not, without first obtaining the approval (by vote or written consent, as provided by law) of not less than a majority of the then-outstanding shares of the Series B Preferred Stock, as determined on a fully diluted and as-converted basis:

(A)Amend the Corporation’s Certificate of Incorporation or Bylaws in any material respect (other than an amendment to change the name of the Corporation);

(B)Declare or pay any dividend or other distribution upon the Corporation’s capital stock (except dividends payable solely in shares of Common Stock), or purchase, redeem, or otherwise acquire any shares of the Corporation’s capital stock, except for repurchases, at cost, of shares of the capital stock of the Corporation (pursuant to rights held by the Corporation as of the Filing Date) held by the Corporation’s consultants, directors, officers or employees;

(C)Sell, lease, assign, transfer or otherwise convey or otherwise dispose of all or substantially all of the assets of the Corporation or any of its subsidiaries, or effect any consolidation, merger or reorganization involving the Corporation or any of its subsidiaries, or effect any transaction or series of related transactions in which the Corporation’s stockholders immediately prior to such transaction or transactions own immediately after such transaction or transactions less than 50% of the voting securities of the surviving corporation or entity (or its parent);

(D)Reclassify, reorganize or recapitalize the Corporation’s outstanding capital stock;

(E)Create or issue any class or series of stock or other security of the Corporation on parity with or having preference over the Series B Preferred Stock or increase the authorized number of shares of the Series B Preferred Stock;

(F)Effect any transaction with the management, related parties or other affiliates of the Corporation, or extend or waive the terms of any such existing transactions, other than (1) issuances of options, warrants or Common Stock pursuant to an equity incentive plan or similar arrangement approved by the Board of Directors or (2) any other

Exhibit 4.1

(G)transaction with management, related parties or affiliates of the Corporation on terms approved by a majority of the members of the Board of Directors who are not, either directly or indirectly, a party to such transaction; and

(H)Increase or decrease the number of directors on the Board of Directors of the Corporation.

(h)Financial Statements, Reports, etc.  The Corporation shall furnish to each to each holder of the Series B Preferred Stock:

(i)within 90 days after the end of each fiscal year, its consolidated balance sheet and related statements of income, stockholders’ equity and cash flows showing the financial condition of the Corporation and its consolidated subsidiaries as of the close of such fiscal year and the results of its operations and the operations of such persons during such year, together with comparative figures for the immediately preceding fiscal year, all in reasonable detail and prepared in accordance with United States generally accepted accounting principles (“GAAP”), all audited by UHY, LLP or other independent public accountants of recognized national standing and accompanied by an opinion of such accountants (which opinion shall be without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements fairly present the financial condition and results of operations of the Corporation and its consolidated subsidiaries on a consolidated basis in accordance with GAAP;

(ii)within 45 days after the end of each of the first three fiscal quarters of each fiscal year, its consolidated balance sheet and related statements of income, stockholders’ equity and cash flows showing the financial condition of the Corporation and its consolidated subsidiaries as of the close of such fiscal quarter and the results of its operations and the operations of such persons during such fiscal quarter and the then elapsed portion of the fiscal year, and comparative figures for the same periods in the immediately preceding fiscal year, all certified by one of its chief executive officer, chief financial officer, any vice president, principal accounting officer, treasurer, assistant treasurer or controller of such person as fairly presenting in all material respects the financial condition and results of operations of the Corporation and its consolidated subsidiaries on a consolidated basis in accordance with GAAP, subject to normal year-end audit adjustments and the absence of footnotes.

(i)Preemptive Rights. If the Corporation authorizes the issuance and sale of Additional Stock (as defined in Section 1(d)(iv)(B)) other than pursuant to an underwritten public offering registered under the Securities Act or for non-cash consideration pursuant to a merger or consolidation approved by the Board of Directors of the Corporation, the Corporation shall first offer in writing to sell to each holder of Series B Preferred Stock a portion of the securities being issued equal to the quotient obtained by dividing (A) the aggregate number of shares of Series B Preferred Stock then owned by such holder by (B) the aggregate number of shares of Series B Preferred Stock then outstanding. If all offered securities are not subscribed to by such holder of Series B Preferred Stock in writing delivered to the Corporation within twenty days after the date of delivery of the Corporation’s original notice to such holder, then the Corporation shall offer all of such securities for sale to those other holders of Series B Preferred Stock that did elect to subscribe for such securities.  If such offer is oversubscribed by such

Exhibit 4.1

(j)Series B Preferred Stock holders then the Corporation shall offer such securities to such Series B Preferred Stockholders pro rata on the basis of the number of securities previously subscribed to by such holders pursuant to the formula above.  If the holders of Series B Preferred Stock do not elect to subscribe for all of such securities in writing delivered to the Corporation within twenty days after the date of delivery of the Corporation’s second notice then the Corporation shall be free to offer such securities to any other person or persons at a price and on terms determined by the Corporation, provided that such price and terms are no more favorable to such person or persons than the price and terms on which such securities were offered to the holders of Series B Preferred Stock. Any securities not sold by the Corporation within 90 days after the date of the Corporation’s initial notice to the holders of Series B Preferred Stock hereunder shall then become subject again to the provisions of this Section 1(h).

[SIGNATURES ON FOLLOWING PAGE]

Exhibit 4.1

IN WITNESS WHEREOF, Geokinetics Inc. has caused this Amended Certificate of Designation to its Certificate of Incorporation to be signed by Richard F. Miles, its President and Chief Executive Officer, this 28th day of July, 2008.

GEOKINETICS INC.

By:       /s/ Richard F. Miles                                                                           

Richard F. Miles, President and

Chief Executive Officer

0686369.05

940480-000000

EX-10.3

SERIES B-2

AND

WARRANT PURCHASE AGREEMENT

among

Geokinetics Inc.,

Avista Capital Partners, L.P.

and

Avista Capital Partners (Offshore), L.P.

Dated as of July 28, 2008,

Exhibit 10.3

TABLE OF CONTENTS
SECTION 1 DEFINITIONS AND ACCOUNTING TERMS		1
1.1	Definitions	1
1.2	Computation of Time Periods	6
1.3	Terms Generally	6
1.4	Accounting Terms	6
SECTION 2. AUTHORIZATION AND ISSUANCE OF PREFERRED STOCK		6
2.1	Authorization of Issue	6
2.2	Sale and Purchase of the Preferred Stock and Warrants	6
2.3	Closing	7
2.4	Stock Certificates	7
SECTION 3. CONDITIONS TO CLOSING		7
3.1	Representations and Warranties	7
3.2	Performance; No Default under Other Agreements	7
3.3	Officer Certificate	7
3.4	Material Adverse Effect	7
3.5	Consents, Authorizations and Filings, Etc.	8
3.6	Payment of Expenses	8
3.7	Legal Opinion	8
3.8	Management Rights Agreement	8
SECTION 4. REPRESENTATIONS AND WARRANTIES		8
4.1	Due Organization; Power and Authority	8
4.2	Capitalization	9
4.3	Subsidiaries	9
4.4	Due Authorization, Execution and Delivery	9
4.5	Non-Contravention; Authorizations and Approvals	10
4.6	Financial Statements; Securities Filings	11
4.7	Absence of Undisclosed Liabilities or Events	12
4.8	No Actions or Proceedings	12
4.9	Title to Properties	13
4.10	Intellectual Property Rights	13
4.11	Taxes	14
4.12	Employee Benefit Plans	15
4.13	Investment Company Act	16
4.14	Insurance	16
4.15	Compliance with Laws; Permits; Environmental Liabilities	16
4.16	Labor and Employment Matters	17
4.17	Brokerage Fees	17
SECTION 5. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE PURCHASERS		18
5.1	Purchase for Investment	18
5.2	Access to Information	18
5.3	Corporate Power; Authorization; Enforceability	19
5.4	No Actions or Proceedings	19
SECTION 6. OTHER AFFIRMATIVE COVENANTS		19
6.1	Director Representation	19
6.2	Allocation of Purchase Price	19
SECTION 7. EXPENSES, INDEMNIFICATION AND CONTRIBUTION; TERMINATION		19
7.1	Expenses	19
7.2	Indemnification	20
7.3	Survival	20
7.4	Tax Treatment of Indemnification Payments	20
SECTION 8. MISCELLANEOUS		20
8.1	Notices	20
8.2	Benefit of Agreement and Assignments	21
8.3	No Waiver; Remedies Cumulative	21
8.4	Amendments, Waivers and Consents	21
8.5	Counterparts	21
8.6	Headings	22
8.7	Survival of Covenants and Indemnities	22
8.8	Governing Law; Submission to Jurisdiction; Venue	22
8.9	Severability	23
8.10	Entirety	23
8.11	Survival of Representations and Warranties	23
8.12	Construction	23
8.13	Incorporation	23
8.14	Non-Recourse	23
8.15	Further Assurances	23

EXHIBITS:
Exhibit A	Form of Certificate of Designation
Exhibit B	Form of 2008 Warrants
Exhibit C	Form of Registration Rights Agreement
Exhibit D	Form of Opinion
Exhibit E	Form of Management Rights Agreement
SCHEDULES:
Schedule 2.2	Information relating to the Purchasers
Schedule 4.2	Primary and fully diluted ownership of Capital Stock
Schedule 4.3	Company and Subsidiaries
Schedule 4.8	Actions or Proceedings
Schedule 4.10	Intellectual Property
Schedule 4.12(a)	Employee Benefit Plans
Schedule 4.12(b)	Multi Employer Plans
Schedule 4.12(c)	Retiree Health and Life Benefits
Schedule 4.16	Labor Matters

Exhibit 10.3

SERIES B-2 AND WARRANT PURCHASE AGREEMENT

This SERIES B-2 AND WARRANT PURCHASE AGREEMENT (this “Agreement”), dated as of July 28, 2008, among Geokinetics Inc., a Delaware corporation (the “Company”), Avista Capital Partners, L.P., a Delaware limited partnership (“Avista”), and Avista Capital Partners (Offshore), L.P., a Bermuda limited partnership (“Avista Offshore” and together with Avista the “Purchasers”).

WHEREAS, the Company desires to increase its capital for the purpose of providing funds for additional equipment purchases and other general corporate purposes;

WHEREAS, in connection with the transactions contemplated hereby, the Company desires to amend its Certificate of Incorporation, dated January 31, 1980, as amended (the “Charter”), in accordance with the General Corporation Law of the State of Delaware (the “DGCL”), by filing an Amended Certificate of Designation (the “Certificate of Designation”), on the date hereof and in the form attached hereto as Exhibit A, with the office of the Secretary of State of the State of Delaware, to create a new series of preferred stock of the Company designated as Series B-2 Senior Convertible Preferred Stock, par value $10.00 per share, having a liquidation preference of $250.00 per share (the “Series B-2 Preferred Stock”), and to redesignate the Company’s existing Series B Senior Convertible Preferred Stock, par value $10.00 per share, as “Series B-1 Preferred Stock” (together with the Series B-2 Preferred Stock, the “Series B Preferred Stock”);

WHEREAS, on the terms and subject to the conditions hereinafter set forth, the Company desires to issue and sell (i) 120,000 shares of Series B-2 Preferred Stock and (ii) warrants (the “2008 Warrants”) to purchase up to an aggregate of 240,000 shares of the Company's Common Stock, par value $0.01 per share (the “Common Stock”), to Purchasers, and Purchasers desire to purchase and acquire the Series B-2 Preferred Stock and the 2008 Warrants from the Company; and

WHEREAS, the Purchasers and the Company intend to enter into that certain Amended and Restated Registration Rights Agreement (as defined herein) which will set forth certain registration rights with respect to the Series B-2 Preferred Stock.

NOW, THEREFORE, the parties hereto agree as follows:

SECTION 1.  DEFINITIONS AND ACCOUNTING TERMS

1.1Definitions.  As used herein, defined terms used herein shall have the meanings specified herein unless the context otherwise requires:

“Accredited Investor” means any Person that is an “accredited investor” within the meaning of Rule 501(a) under the Securities Act.

“Applicable Law” means all laws, statutes, treaties, rules, codes (including building codes), ordinances, regulations, certificates, orders and licenses of, and interpretations by, any Governmental Authority and judgments, decrees, injunctions, writs, permits, orders or like governmental action of any Governmental Authority (including environmental laws and those pertaining to health or safety) applicable to the Company or any of its Subsidiaries or any of their property or operations.

“Audit Date” is defined in Section 4.6(a).

“Capital Stock” means (i) in the case of a corporation, corporate or capital stock, (ii) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate or capital stock, (iii) in the case of a limited liability company, membership units (whether common or preferred), (iv) in the case of a partnership, partnership interests (whether general or limited) and (v) any other equivalent ownership interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

“Certificate of Designation” is defined in the recitals.

“Charter” is defined in the recitals.

“Closing” is defined in Section 2.3.

“Closing Date” is defined in Section 2.3.

“Closing Payment” shall mean 2% of the Purchase Price.

“Code” means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder.

“Common Stock” is defined in the recitals.

“Convert Shares” means the shares of the Company’s Common Stock issuable upon conversion of the Preferred Stock.

“DGCL” is defined in the recitals.

“Enforceability Exceptions” means, with respect to any specified obligation, any limitations on the enforceability of such obligation due to applicable bankruptcy, insolvency, reorganization, fraudulent conveyance, fraudulent transfer, moratorium, and other similar laws of general applicability relating to or affecting creditors’ rights or general equity principles (including public policies) or except as rights to indemnification or contribution may be limited by Federal, state, provincial or territorial securities laws.

“Environmental Permits” is defined in Section 4.15(b) (i).

“Exchange Act” is defined in Section 4.6(b).

“ERISA Affiliate” is defined in Section 4.12(b).

“Financial Statements” is defined in Section 4.6(a).

Exhibit 10.3

“Financing Documents” means collectively, this Agreement, the Certificate of Designation, the Registration Rights Agreement, the 2008 Warrants, and all certificates, instruments and other documents made or delivered in connection herewith and therewith.

“GAAP” means generally accepted accounting principles, as applied in the United States.

“HSR Act” is defined in Section 3.5.

“Indemnitees” is defined in Section 7.2.

“Intellectual Property” means (a) all inventions and discoveries (whether patentable or unpatentable and whether or not reduced to practice), and all patents, patent applications and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions and reexaminations thereof, (b) all trademarks, service marks, trade dress, logos, trade names, corporate names and domain names, together with all translations, adaptations and combinations thereof and including all goodwill associated therewith, (c) all copyrights and all applications, registrations and renewals in connection therewith, (d) all mask works and all applications, registrations and renewals in connection therewith, (e) all know-how, trade secrets and confidential business information, whether patentable or unpatentable and whether or not reduced to practice (including ideas, research and development, know-how, formulas, compositions and manufacturing and production process and techniques, technical data, designs, drawings, specifications, customer and supplier lists, pricing and cost information and business and marketing plans and proposals), (f) all computer software (including data and related documentation), (g) all other proprietary rights, (h) all copies and tangible embodiments thereof (in whatever form or medium) and (i) all licenses and agreements in connection therewith.

“IRS” means the Internal Revenue Service.

“Legal Proceeding” means any judicial, administrative or arbitral actions, suits, mediation, investigation, inquiry, proceedings or claims (including counterclaims) by or before a Governmental Authority.

“Material” means material in relation to the business, condition (financial or otherwise), properties or results of operation of the Company and its Subsidiaries taken as a whole.

“Material Adverse Effect” shall mean (a) a material adverse effect on the business, assets, liabilities, operations, prospects or condition (financial or otherwise) or operating results of the Company and the Subsidiaries, taken as a whole, (b) a material impairment of the ability of any party to perform any of its obligations under any Financing Document to which it is or will be a party or (c) a material impairment of any rights of or benefits available to the Purchasers under any Financing Document.

“Order” means any order, injunction, judgment, doctrine, decree, ruling, writ, assessment or arbitration award of a Governmental Authority.

Exhibit 10.3

“Ordinary Course of Business” means the ordinary and usual course of day-to-day operations of the business of the Company and the Subsidiaries through the date hereof consistent with past practice.

“Permits” means any approvals, authorizations, consents, licenses, permits or certificates of a Governmental Authority.

“Permitted Exceptions” means (i) all defects, exceptions, restrictions, easements, rights of way and encumbrances disclosed in policies of title insurance which have been delivered to the Purchasers; (ii) statutory liens for current Taxes, assessments or other governmental charges not yet delinquent or the amount or validity of which is being diligently contested in good faith by appropriate proceedings, provided an appropriate reserve has been established therefor in the Financial Statements in accordance with GAAP; (iii) mechanics’, carriers’, workers’, and repairers’ Liens arising or incurred in the Ordinary Course of Business that are not material to the business, operations and financial condition of the Company Property so encumbered and that are not resulting from a breach, default or violation by the Company or any of the Subsidiaries of any contract or law; (iv) zoning, entitlement and other land use and environmental regulations by any Governmental Authority, provided that such regulations have not been violated; and (v) liens and security interests created or permitted by the senior most indebtedness of the Company or the Subsidiaries in existence as of the Closing Date.

“Plan” is defined in Section 4.12(a).

“Property” is defined in Section 4.15(b)(iii).

“Purchase Price” is defined in Section 2.2.

“Purchasers” is defined in the preamble to this Agreement.

“Registration Rights Agreement” means the Amended and Restated Registration Rights Agreement, dated as of the date hereof, among Company and the Purchasers, in the form attached hereto as Exhibit B as amended, supplemented, restated or otherwise modified from time to time.

“Responsible Officer” means (i) with respect to the Company, the chairman, the chief executive officer, the president, the chief financial officer thereof, and (ii) with respect to the Company or any Subsidiary (other than the Company), any duly authorized officer thereof.

“Rule 144” means Rule 144 under the Securities Act (or any successor provision), as it may be amended from time to time.

“SEC” is defined in Section 4.6(b).

“SEC Documents” is defined in Section 4.6(b).

“Securities Act” means the Securities Act of 1933, as amended.

Exhibit 10.3

“Software” means any and all computer programs, whether in source code or object code; databases and compilations, whether machine readable or otherwise; descriptions, flow-charts and other work product used to design, plan, organize and develop any of the foregoing; and all documentation including user manuals and other training documentation related to any of the foregoing.

“Solvent” means, with respect to any Person as of the date of any determination, that on such date (a) such Person as of such date generally is able to pay its debts and other liabilities, contingent obligations and other commitments as they become absolute and mature in the normal course of business, (b) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature and (c) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such Person’s property would constitute unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted following the Closing Date.  In computing the amount of contingent liabilities at any time, such liabilities shall be computed as the amount that, in light of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

“Series B Preferred Stock” is defined in the recitals.

“Series B-1 Preferred Stock” is defined in the recitals.

“Series B-2 Preferred Stock” is defined in the recitals.

“Subsidiary” means any Person of which (i) a majority of the outstanding share capital, voting securities or other equity interests are owned, directly or indirectly, by the Company or (ii) the Company is entitled, directly or indirectly, to appoint a majority of the board of directors, board of managers or comparable body of such Person.

“Tax” or “Taxes” shall mean (i) any and all federal, state, local or foreign taxes, charges, fees, imposts, levies or other assessments, including all net income, gross receipts, capital, sales, use, ad valorem, value added, transfer, franchise, profits, inventory, capital stock, license, withholding, payroll, employment, social security, unemployment, excise, severance, stamp, occupation, property and estimated taxes, customs duties, fees, assessments and charges of any kind whatsoever; (ii) all interest, penalties, fines, additions to tax or additional amounts imposed by any Taxing Authority in connection with any item described in clause (i); and (iii) any liability in respect of any items described in clauses (i) and/or (ii) payable by reason of Contract, assumption, transferee liability, operation of law, Treasury Regulation section 1.1502-6(a) (or any predecessor or successor thereof or any analogous or similar provision under law) or otherwise.

“Tax Return” means any return, report or statement (whether federal, state, local or foreign) required to be filed with respect to any Tax (including any elections, declarations, schedules or attachments thereto, and any amendment thereof) including any information return, claim for refund, amended return or declaration of estimated Tax, and including, where permitted

Exhibit 10.3

or required, combined, consolidated or unitary returns for any group of entities that includes the Company, any of the Subsidiaries, or any of their Affiliates.

“Taxing Authority” means the IRS and any other governmental authority responsible for the administration of any Tax.

“Technology” means, collectively, designs, formulae, algorithms, procedures, methods, techniques, ideas, know-how, results of research and development, Software, tools, data, inventions, apparatus, creations, improvements, works of authorship and other similar materials, and all recordings, graphs, drawings, reports, analyses, and other writings, and any other embodiments of the above, in any form whether or not specifically listed herein, and all related technology, that are used, incorporated, or embodied in or displayed by any of the foregoing or used in the design, development, reproduction, sale, marketing, maintenance or modification of any of the foregoing

“2008 Warrants” is defined in the recitals.

1.2Computation of Time Periods.  For purposes of computation of periods of time hereunder, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding.”

1.3Terms Generally.  Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, and (c) the word “including” shall mean “including without limitation.”

1.4Accounting Terms.  Accounting terms used but not otherwise defined herein shall have the meanings provided, and be construed in accordance with, GAAP.

SECTION 2.  AUTHORIZATION AND ISSUANCE OF PREFERRED STOCK

2.1Authorization of Issue.  On or prior to the execution and delivery of this Agreement: (i) the Company will authorize the issue and sale of the Series B-2 Preferred Stock and the 2008 Warrants; and (ii) adopt and file the Certificate of Designation with the Secretary of State of Delaware.

2.2Sale and Purchase of the Preferred Stock and Warrants.  Subject to the terms and conditions of this Agreement, the Company will issue and sell to each of the Purchasers, and each of the Purchasers will purchase from the Company, at the Closing provided for in Section 2.3, the Series B-2 Preferred Stock and 2008 Warrants, for an aggregate purchase price equal to $30,000,000 (the “Purchase Price”), in such proportions as set forth on Schedule 2.2.  The Purchase Price shall be paid by the Purchasers by wire transfer of immediately available funds to an account designated by the Company.  At the Closing the Company shall pay each Purchaser

2.3its proportionate share of the Closing Payment as set forth on Schedule 2.2, via wire transfer of immediately available funds pursuant to the instructions set forth on Schedule 2.2.

2.4Closing.  The sale and purchase of the Preferred Stock shall occur at the offices of Chamberlain, Hrdlicka, White, Williams & Martin, 1200 Smith Street, 14th Floor,  Houston, Texas 77002, at 10:00 a.m. local time, at a closing (the “Closing”) on July ____, 2008.  The date upon which the Closing occurs shall be referred to herein as the “Closing Date”.

2.5Stock Certificates.  At the Closing, the Company shall deliver to the Purchasers duly endorsed certificates representing the Series B-2 Preferred Stock with such number of shares allocated to each Purchaser as set forth on Schedule 2.2.

Exhibit 10.3

SECTION 3.  CONDITIONS TO CLOSING

Each Purchaser’s obligation to purchase and pay for the Series B-2 Preferred Stock and 2008 Warrants to be purchased by it at the Closing is subject to the reasonable satisfaction or waiver by it prior to or at the Closing of each of the conditions specified below in this Section 3:

3.1Representations and Warranties.  Each of the representations and warranties of the Company in this Agreement that are qualified as to materiality or Material Adverse Effect shall be true and correct and each of the representations and warranties of the Company in this Agreement that are not so qualified shall be true and correct in all material respects on or as of the Closing Date as if made on and as of the Closing Date (unless stated to relate to a specific earlier date, in which case such representations and warranties qualified as to materiality or Material Adverse Effect shall be true and correct and those not qualified shall be true and correct in all material respects as of such earlier date).

3.2Performance; No Default under Other Agreements.  The Company shall have performed and complied in all material respects with all agreements and covenants contained herein required to be performed or complied with by it prior to or at the Closing (or such compliance shall have been waived on terms and conditions reasonably satisfactory to each Purchaser).

3.3Officer Certificate.  The Company shall have delivered to each Purchaser an Officers’ Certificate, dated as of the Closing Date, in a form reasonably satisfactory to Avista, certifying as to Company’s certificate of incorporation and bylaws, the incumbency and signatures of certain officers of the Company and other corporate proceedings of the Company relating to the authorization, execution, delivery and performance of this Agreement and the other Financing Documents to which the Company is a party and that the conditions specified in Section 3 (other than Section 3.3) have been fulfilled, except as to matters which require the approval or satisfaction of the Purchasers.

3.4Material Adverse Effect.  There shall not have occurred or become known to the Purchasers any event, development or circumstance with respect to the Company or its

Exhibit 10.3

3.5Subsidiaries since March 31, 2008 that has caused or could reasonably be expected to cause a Material Adverse Effect.

3.6Consents, Authorizations and Filings, Etc.  All material governmental and third party approvals necessary in connection with the Financing Documents, and the continuing operations of the Company and its Subsidiaries shall have been obtained and be in full force and effect (including any required filings pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”) made with the Federal Trade Commission and the United States Department of Justice), and all applicable waiting periods shall have expired without any action being taken or threatened by any competent authority that would restrain, prevent or otherwise impose material adverse conditions on the Series B-2 Preferred Stock.

(a)There shall be no inquiry, injunction, restraining order, action, suit or proceeding instituted or entered or any statute or rule proposed, enacted or promulgated by any Governmental Authority or any other Person which, in the reasonable opinion of the Purchasers, individually or in the aggregate, has or would reasonably be expected to have a Material Adverse Effect or which seeks to enjoin or seek substantial damages against the Company or its Subsidiaries or any of the Purchasers as a result of the issuance and sale of the Preferred Stock.

(b)The Board of Directors of the Company shall have granted all necessary approvals to the transactions contemplated by this Agreement and the conversion of the Series B-2 Preferred Stock into Convert Shares in order to satisfy DGCL Section 203 with respect to such transactions.

3.7Payment of Expenses.  At the Closing, each Purchaser and one counsel for  the Purchasers shall have received from the Company all other fees required to be paid, and, in accordance with Section 7, all reasonable costs and expenses for which invoices have been presented.

3.8Legal Opinion.  At the Closing, Chamberlain, Hrdlicka, White, Williams & Martin shall have delivered to the Purchasers an opinion, dated as of the Closing Date, in the form of Exhibit 3.7.

3.9Management Rights Agreement.  At the Closing, the Company shall have delivered to Avista a Management Rights Agreement dated as of the Closing Date, in the form of Exhibit 3.8.

SECTION 4.  REPRESENTATIONS AND WARRANTIES

The Company represents and warrants to the Purchasers that:

4.1Due Organization; Power and Authority.  The Company and each domestic Subsidiary of the Company (a) is a corporation or a limited partnership duly incorporated or formed, as the case may be, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization, (b) is duly qualified as a foreign corporation or extra provincial partnership or a foreign partnership, as the case may be, to transact business and

Exhibit 10.3

4.2is in good standing in each jurisdiction in which such qualification is required, (c) has full corporate or partnership, as the case may be, power and authority to own, lease and operate its properties and to conduct its businesses as they are currently conducted, and (d) has full corporate or partnership, as the case may be, power and authority to enter into and perform its obligations under each of the Financing Documents to which it is a party.

4.3Capitalization.  After giving effect to the sale of the Series B-2 Preferred Stock and the 2008 Warrants to the Purchasers, at the Closing, (i) the authorized number of shares of Capital Stock of the Company will consist only of 100,000,000 common shares (the “Common Stock”), of which 10,396,018 shares have been issued and are outstanding, (ii) 2,500,000 preferred shares, of which only (x) 257,526 shares of Series B-1 Preferred Stock and (y) the Series B-2 Preferred Stock sold to the Purchasers pursuant to this Agreement will have been issued and outstanding as of the Closing Date, and (iii) no shares of any class of the Capital Stock of the Company will be held by the Company in its treasury or by the Company’s Subsidiaries.  Upon consummation of the sale of the Series B-2 Preferred Stock and the 2008 Warrants to the Purchasers, all of the issued and outstanding shares of Capital Stock of the Company shall have been duly authorized and validly issued, fully paid and nonassessable and shall be free of preemptive rights except as set forth in the Certificate of Designation.  Upon consummation of the sale of the Series B-2 Preferred Stock and the 2008 Warrants to the Purchasers, except as set forth on Schedule 4.2 and other than the Series B Preferred Stock, the 2008 Warrants and employee stock options under the 2002 Stock Awards Plan and the 2007 Stock Awards Plan of the Company, there shall be no securities of the Company or any of its Subsidiaries that will be convertible into or exchangeable for shares of any Capital Stock of the Company or any of its Subsidiaries, and no options, calls, subscriptions, convertible securities, or other rights, agreements or commitments which will obligate the Company or any of its Subsidiaries to issue, transfer or sell any shares of Capital Stock of, or other interests in, the Company or any of its Subsidiaries.  Except as set forth on Schedule 4.2, upon consummation of the sale of the Series B-2 Preferred Stock and the 2008 Warrants to the Purchasers, there shall be no outstanding obligations of the Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any shares of Capital Stock of the Company or any of its Subsidiaries and none of the Company or any of its Subsidiaries shall have any awards or options outstanding under any stock option plans or agreements or any other outstanding stock-related awards.  As of the Closing Date and immediately after the Closing, except as set forth on Schedule 4.2 and other than the Series B Preferred Stock, none of the Company or any of its Subsidiaries will have any obligation to issue, transfer or sell any shares of Capital Stock of the Company or its Subsidiaries.  Except as set forth on Schedule 4.2, there are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect to the holding, voting or disposing of Capital Stock of the Company or any of its Subsidiaries.  Except as set forth on Schedule 4.2, none of the Company or any of its Subsidiaries has any outstanding bonds, debentures, notes or other obligations or other securities that entitle the holders thereof to vote with the shareholders of the Company or any of its Subsidiaries on any matter or which are convertible into or exercisable for securities having such a right to vote.

4.4Subsidiaries.  Schedule 4.3 correctly states (a) the name of each of the Company’s direct and indirect Subsidiaries, and (b) the name of each registered holder of each class of outstanding Capital Stock or other securities of each of the Company’s respective direct and indirect Subsidiaries and the nature and number of such securities held by such holder.  Each

Exhibit 10.3

4.5issued and outstanding share of Capital Stock of each direct and indirect Subsidiary of the Company (a) has been duly authorized and validly issued and is fully paid and nonassessable and free of preemptive rights and (b) except for any Equity Interests not owned directly or indirectly by the Company as shown on Schedule 4.3 is owned by the Company, directly or through its direct and indirect Subsidiaries, free and clear of any Lien other than the liens established under the Financing Documents and other Permitted Exceptions.

4.6Due Authorization, Execution and Delivery.

(a)Agreement.  This Agreement has been duly authorized, executed and delivered by the Company and, when duly executed and delivered by the Purchasers in accordance with its terms, will constitute a valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions.

(b)Series B-2 Preferred Stock and the Convert Shares.  The Series B-2 Preferred Stock has been duly authorized and, when issued as provided herein, will be validly issued, free of preemptive rights and free from all taxes, liens, charges and security interests known to or created by the Company and no personal liability will attach to the ownership thereof.  When the Convert Shares are issued pursuant to a conversion of the Series B-2 Preferred Stock, the Convert Shares will be validly issued, fully paid and nonassessable, free of preemptive rights and free from all taxes, liens, charges and security interests known to or created by the Company and no personal liability will attach to the ownership thereof.

(c)Financing Documents.  Each of the Financing Documents has been duly authorized, executed and delivered by the Company and, when duly executed and delivered by the other parties thereto in accordance with their terms, will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions.

4.7Non-Contravention; Authorizations and Approvals.  None of (a) the execution and delivery by the Company or any Subsidiary of the Company of any of the Financing Documents to which it is a party, (b) the performance by any of them of their respective obligations thereunder, (c) the consummation of the transactions contemplated thereby or (d) the issuance and delivery of the Series B-2 Preferred Stock and the 2008 Warrants under the Financing Documents will: (i) violate, conflict with or result in a breach of any provisions of the articles of incorporation or any amendment thereto or bylaws (or comparable constituent or governing documents) of the Company or any Subsidiary of the Company; (ii) violate, conflict with, result in a breach of any provision of, constitute a default (or an event which, with notice, lapse of time or both, would constitute a default) under, result in the termination or in a right of termination of, accelerate the performance required by or benefit obtainable under, result in the triggering of any payment or other obligations (including any repurchase or repayment obligations) pursuant to, result in the creation of any Lien upon any of the properties of the Company or any Subsidiary of the Company under, or result in there being declared void, voidable, subject to withdrawal, or without further binding effect, any of the terms, conditions or provisions of any contract, except for any such violations, conflicts, breaches, defaults, accelerations, terminations or other matters which, in the aggregate, could not reasonably be

Exhibit 10.3

4.8expected to be Material to the Company; (iii) require any consent, approval or authorization of, or declaration, filing or registration with, any Governmental Authority, except for those consents, approvals, authorizations, declarations, filings or registrations which have been obtained or made, or the failure of which to obtain or make, in the aggregate, could not be reasonably expected to have a Material Adverse Effect; or (iv) violate any Applicable Laws, except for violations which, in the aggregate, could not reasonably be expected to be Material to the Company.

4.9Financial Statements; Securities Filings.

(a)The Company has heretofore furnished to the Purchasers its consolidated balance sheets and related statements of income, stockholder’s equity and cash flows (the “Financial Statements”) (i) as of and for the fiscal year ended December 31, 2007 (the “Audit Date”), audited by and accompanied by the report of UHY, LLP, independent public accountants, and (ii) as of and for the fiscal quarter ended March 31, 2008, and each month ended after March 31, 2008 and at least 30 days before the Closing Date, each certified by its chief financial officer.  Such Financial Statements present fairly in all material respects the financial condition and results of operations and cash flows of the Company and its Subsidiaries as of such dates and for such periods.  Such balance sheets and the notes thereto disclose all material liabilities, direct or contingent, of the Company and its Subsidiaries as of the dates thereof.  Such Financial Statements were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise noted therein and, subject, in the case of unaudited financial statements, to year-end audit adjustments and the absence of footnotes.

(b)The Company has filed with the Securities and Exchange Commission (the “SEC”) all forms, reports, schedules, statements, exhibits and other documents required to be filed under the Exchange Act of 1934, as amended (the “Exchange Act”), or the Securities Act, (collectively, the “SEC Documents”).  As of its filing date or, if amended, as of the date of the last such amendment, each SEC Document fully complied with the applicable requirements of the Exchange Act and the Securities Act, as the case may be, and the applicable rules and regulations of the SEC thereunder.  As of its filing date, or, if amended, as of the date of the last such amendment, each SEC Document filed pursuant to the Exchange Act did not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.  Each SEC Document that is a registration statement, as amended or supplemented, if applicable, filed pursuant to the Securities Act, as of the date such registration statement or amendment became effective, did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading.  None of the Subsidiaries is or has been required to file any forms, reports or other documents with the SEC.  All of the audited consolidated financial statements and unaudited consolidated interim financial statements included in the SEC Documents (i) have been prepared from, are in accordance with and accurately reflect the books and records of the Company and its consolidated Subsidiaries, (ii) fully comply with the applicable accounting requirements and with the published rules and regulations of the SEC with respect thereto (including Regulation S-X), (iii) were prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto and

Exhibit 10.3

(c)except, in the case of the unaudited interim statements, as may be permitted under the Exchange Act with respect to Quarterly Reports on Form 10-Q and (iv) fairly present, in all material respects, the consolidated financial position and the consolidated results of operations and cash flows (subject, in the case of unaudited interim financial statements, to normal year end adjustments) of the Company and its consolidated Subsidiaries as of the dates and for the periods referred to therein.  The reports of the Company’s independent auditors regarding the Company’s consolidated financial statements in the SEC filings have not been withdrawn, supplemented or modified, and none of the Company or any of the Subsidiaries has received any communication from its independent auditors concerning any such withdrawal, supplement or modification.

(d)The Company’s principal executive officer and its principal financial officer have disclosed, based on their most recent evaluation, to the Company’s auditors and the audit committee of the Board of Directors of the Company (i) all significant deficiencies in the design or operation of internal controls which could adversely affect the Company’s ability to record, process, summarize and report financial data and have identified for the Company’s auditors any material weaknesses in internal controls and (ii) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal controls.

(e)The Company has established and maintains disclosure controls and procedures (as such term is defined in Rule 13a-15 under the Exchange Act); such disclosure controls and procedures are designed to ensure that material information relating to the Company, including the Subsidiaries, is made known to the Company’s principal executive officer and its principal financial officer by others within those entities, and, to the knowledge of the Company, such disclosure controls and procedures are effective in timely alerting the Company’s principal executive officer and its principal financial officer to material information.

4.10Absence of Undisclosed Liabilities or Events.

(a)Neither the Company nor any Subsidiary has any Indebtedness or liabilities (whether or not required under GAAP to be reflected on a balance sheet or the notes thereto) other than those (i) specifically reflected on and fully reserved against in the Financial Statements, (ii) incurred in the Ordinary Course of Business since the Audit Date or (iii) that are immaterial to the Company or any Subsidiary.

(b)The Financing Documents, taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made as of the date the same were made, not materially misleading.  Since the Audit Date, there has been no event, development or circumstance that has caused or could reasonably be expected to cause a Material Adverse Effect.

4.11No Actions or Proceedings.  Except as set forth on Schedule 4.8, there are no legal or governmental actions, suits or proceedings pending or, to the Company’s knowledge, threatened against or affecting the Company or any Subsidiary of the Company, or any of their respective properties or assets which, if adversely determined, in the aggregate, could reasonably

Exhibit 10.3

4.12be expected to be Material to the Company.  No Governmental Authority has notified the Company or any Subsidiary of the Company in writing of an intention to conduct any audit, investigation or other review with respect to the Company or any Subsidiary of the Company.

4.13Title to Properties.  Each of the Company and each Subsidiary of the Company has (a) good title to, or a valid and subsisting leasehold interest in, all of its material real property and (b) good title to, or a valid and subsisting leasehold interest in, all of its material equipment and other personal property, in each case free and clear of all Liens, except Permitted Exceptions.

4.14Intellectual Property Rights.

(a)Except as set forth on Schedule 4.10, the Company and its Subsidiaries own all right, title and interest in and to, or have valid and continuing rights to use, sell and license, all Intellectual Property, Software and other Technology used in the conduct of the business and operations of the Company and its Subsidiaries as presently conducted and as currently proposed to be conducted, free and clear of all Liens or obligations to others.  All such owned Intellectual Property is subsisting, and all necessary registration, maintenance, renewal, and other relevant filing fees due through the date hereof in connection therewith have been timely paid and all necessary documents and certificates in connection therewith have been timely filed with the relevant patent, copyright, trademark, or other authorities in the United States or foreign jurisdictions, as the case may be, for the purposes of maintaining such registered Intellectual Property in full force and effect.  The business and operations of the Company and its Subsidiaries, their Technology, their products and services and the designing, development, manufacturing, reproduction, use, marketing, sale, distribution, maintenance and modification of any of the foregoing as presently performed and as currently contemplated to be performed does not infringe upon, misappropriate or otherwise violate any Intellectual Property of any third party.  All of the material Intellectual Property owned by the Company or any of its Subsidiaries is valid and enforceable.

(b)Except as set forth in Schedule 4.10, there is no action, suit, proceeding, hearing, investigation, notice or complaint pending or, to the Company’s knowledge, threatened, by any third party before any court or tribunal (including, without limitation, the United States Patent and Trademark Office or equivalent authority anywhere in the world) relating to any of Company’s or any of its Subsidiaries’ Intellectual Property or Technology, nor has any claim or demand been made by any third party that (i) challenges the validity, enforceability, use or exclusive ownership of any Intellectual Property or Technology owned by the Company or any of its Subsidiaries or (ii) alleges any infringement, misappropriation, violation, or unfair competition or trade practices by the Company or any of its Subsidiaries of any Intellectual Property or Technology of any third party, nor is the Company aware of any basis for any such claim or demand.

(c)There are no agreements between the Company or any of its Subsidiaries and any third party relating to any Intellectual Property of the Company or any of its Subsidiaries or any third party under which there is, as of the date of this Agreement, or, to the Company’s

Exhibit 10.3

(d)knowledge, is expected, as of the date of this Agreement, to be, any Material dispute regarding the scope or performance of such agreement.

(e)None of the Company’s or any of its Subsidiaries’ Technology or Intellectual Property are subject to any outstanding injunction, decree, order, judgment, agreement or stipulation that restricts in any manner the use, transfer or licensing thereof by the Company or any of its Subsidiaries or affects the validity, use or enforceability of any such Technology or Intellectual Property.

(f)The Company and the Subsidiaries have taken reasonable measures to protect the confidentiality of all Material trade secrets owned by the Company or any of its Subsidiaries that are material to their businesses as currently conducted and as proposed to be conducted.  The Company and its Subsidiaries have executed valid written agreements with certain of their past and present employees who have contributed to the development of Material Technology and Intellectual Property pursuant to which such employees have assigned to the Company or its Subsidiaries all their rights in and to all Material Technology and Intellectual Property they may develop in the course of their employment and agreed to hold all trade secrets and confidential information of the Company and its Subsidiaries in confidence both during and after their employment.  The Company and its Subsidiaries have executed valid written agreements with certain past and present consultants and independent contractors who have been retained in connection with the development of Material Technology and Intellectual Property by which the consultants and independent contractors have  assigned to the Company or its Subsidiaries all their rights in and to such Material Technology and Intellectual Property and agreed to hold all trade secrets and confidential information of the Company and its Subsidiaries in confidence both during and after the term of their engagements.  No Material trade secrets or other Material confidential information owned by the Company or any of its Subsidiaries that is material to their businesses as currently conducted and as proposed to be conducted have been disclosed or authorized to be disclosed by the Company or any of its Subsidiaries to any of their employees or any third party other than pursuant to a written non-disclosure or confidentiality agreement.  To the knowledge of the Company and its Subsidiaries, no employee, consultant or independent contractor of the Company or any Subsidiary is, as a result of or in the course of such employee’s, consultant’s or independent contractor’s engagement by the Company or any Subsidiary, in default or breach of any Material term of any employment agreement, non-disclosure agreement, assignment of invention agreement or similar agreement.

4.15Taxes.

(a)(i) All Tax Returns required to be filed by or on behalf of each of the Company, any Subsidiary and any affiliated group of which the Company or any Subsidiary is or was a member have been duly and timely filed with the appropriate Taxing Authority in all jurisdictions in which such Tax Returns are required to be filed (after giving effect to any valid extensions of time in which to make such filings), and all such Tax Returns are true, complete and correct in all material respects; and (ii) all Taxes payable by or on behalf of each of the Company, any Subsidiary and any affiliated group of which the Company or any Subsidiary is or was a member have been fully and timely paid.  With respect to any period for which Tax Returns have not yet been filed or for which Taxes are not yet due or owing, the Company has made due and sufficient accruals for such Taxes in the Financial Statements and its books and

Exhibit 10.3

(b)records.  All required estimated Tax payments sufficient to avoid any underpayment penalties or interest have been made by or on behalf of the Company and each Subsidiary.

(c)The Company and each Subsidiary has complied in all material respects with all applicable Laws relating to the payment and withholding of Taxes and has duly and timely withheld and paid over to the appropriate Taxing Authority all amounts required to be so withheld and paid under all applicable Laws.

(d)All deficiencies asserted or assessments made as a result of any examinations by any Taxing Authority of the Tax Returns of, or including, the Company or any Subsidiary have been fully paid, and there are no other audits or investigations by any Taxing Authority in progress, nor has the Company or any of the Subsidiaries received any written notice from any Taxing Authority that it intends to conduct such an audit or investigation.  No issue has been raised by a Taxing Authority in any prior examination of the Company or any Subsidiary which, by application of the same or similar principles, could reasonably be expected to result in a proposed deficiency for any subsequent taxable period.

(e)There are no Liens for Taxes on any of the assets of the Company or any of its Subsidiaries other than Liens for Taxes not yet due and payable or which are being contested in good faith by appropriate proceedings and for which adequate reserves have been provided to the extent required by GAAP.

(f)The Company is not a “United States Real Property Holding Corporation” within the meaning of Section 897 of the Code.

(g)The Company and the Subsidiaries have disclosed on their federal income Tax Returns all positions taken therein that could give rise to substantial understatement of federal income tax within the meaning of Section 6662 of the Code.

4.16Employee Benefit Plans.

(a)Schedule 4.12(a) lists all “employee benefit plans”, within the meaning of Section 3(3) of ERISA, and all other material employee benefit plans, arrangements and policies with respect to employees or former employees maintained by or contributed to by the Company or any of its Subsidiaries (each, a “Plan”).  There has been no failure by any Plan to comply with the applicable requirements of ERISA and the Code.  There is no pending or, to the knowledge of the Company, threatened, litigation relating to the Plans.  None of the Company or any of its Subsidiaries has engaged in a transaction with respect to any Plan that could subject the Company or any of its Subsidiaries to a tax or penalty imposed by either Section 4975 of the Code or Section 502(i) of ERISA.  The Company is not aware, after due inquiry, of any item of non-compliance which could reasonably be expected to result in the loss of Plan qualification or tax-exempt status.  To the knowledge of the Company, all required contributions have been made in accordance with the provisions of each Plan.

(b)Within the past six years, no liability under Title IV of ERISA has been incurred by the Company or any of its Subsidiaries with respect to any ongoing, frozen or terminated “single-employer plan,” within the meaning of Section 4001(a)(15) of ERISA, or

Exhibit 10.3

(c)“multi employer plan,” within the meaning of Section 3(37) of ERISA, currently or formerly maintained by any of them, or the single-employer plan or multi-employer plan of any entity which is considered to be a single employer with the Company or any of its Subsidiaries under Section 4001(b)(1) of ERISA or Section 414(b) or (c) of the Code (an “ERISA Affiliate”).  Except as set forth on Schedule 4.12(b), none of the Company or any of its Subsidiaries has contributed to a “multi employer plan,” within the meaning of Section 3(37) of ERISA, at any time after June 30, 1997.

(d)Except as set forth on Schedule 4.12(c), neither the Company nor any of its Subsidiaries has any material obligations for retiree health and life benefits under any Plan, except as required by Applicable Law.

4.17Investment Company Act.  Neither the Company nor any of its Subsidiaries is or, immediately after receipt of payment for the Series B-2 Preferred Stock and the 2008 Warrants and the consummation of the other Transactions, will be (a) an “investment company” registered or required to be registered under the Investment Company Act of 1940, as amended.

4.18Insurance.  The Company and the Subsidiaries of the Company are insured with policies in such amounts and with such deductibles and covering such risks as are generally deemed adequate for their businesses including, but not limited to, policies covering real and personal property owned or leased by the Company and the Subsidiaries of the Company against theft, damage, destruction and acts of vandalism.

4.19Compliance with Laws; Permits; Environmental Liabilities.

(a)Each of the Company and the Subsidiaries of the Company is in compliance, in all Material respects with all Applicable Laws and has all Permits Material to and necessary in, the conduct of its business as currently conducted and all such Permits are in full force and effect.  No violations have been recorded in respect of any such Permits, and no proceeding is pending or, to the knowledge of the Company, threatened to revoke or limit any Permit.  Neither the Company nor any Subsidiary is subject to any Order, and neither the Company nor any Subsidiary is in breach or violation of any Order.  Neither the Company nor any Subsidiary is engaged in any legal action to recover monies due it or for damages sustained by it.  There are no Legal Proceedings pending or, to the knowledge of the Company or the Subsidiaries, threatened against the Company or to which the Company is otherwise a party relating to this Agreement or, any Financing Document or the transactions contemplated hereby or thereby.

(b)With regard to each of the following, except any matters that in the aggregate, could not reasonably be expected to be Material to the Company:

(i)Each of the Company and each Subsidiary of the Company is currently in Material compliance with all Environmental Laws, has obtained and is currently in Material compliance with all permits, licenses, registrations and consents which are required with respect to any of its facilities or operations under any applicable Environmental Laws (the “Environmental Permits”), and all such Environmental Permits are in full force and effect;

Exhibit 10.3

(ii)None of the Company or any Subsidiaries of the Company has received any written notice of any claims, civil, criminal or administrative actions, suits, hearings, investigations, or proceedings which are pending or, to its knowledge, threatened against it, in each case, on the basis of, any Environmental Liability, or indicating that such Person is or may be a potentially responsible party or otherwise liable under Environmental Laws in connection with any location which has experienced the release or threatened release of any Hazardous Materials;

(iii)To the knowledge of the Company, Hazardous Materials have not been transported or disposed of from any real property owned, leased or operated by the Company or any Subsidiary of the Company (“Property”) in violation of, or in a manner or to a location which could give rise to liability under any Environmental Law, nor have any Hazardous Materials been generated, treated, stored or disposed of at, on or under any Property in violation of, or in a manner that could give rise to liability under, any applicable Environmental Laws;

(iv)No judicial proceeding or governmental or administrative action is pending or, to the knowledge of the Company, threatened, under any Environmental Laws to which the Company or any Subsidiary of the Company is or will be named as a party, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements outstanding under any Environmental Laws with respect to the Company and any Subsidiary of the Company; and

(v)To the knowledge of the Company, there has been no release or threat of release of Hazardous Materials at or from the Properties, or arising from or related to the operations of the Company or any Subsidiary of the Company, in violation of or in amounts or in a manner that could give rise to liability under Environmental Laws.

4.20Labor and Employment Matters.  Except as set forth on Schedule 4.16, (i) none of the Company or any of its Subsidiaries is a party to, or bound by, any collective bargaining agreement or other contracts with a labor union or labor organization; and (ii) there is no (A) Material unfair labor practice, labor dispute (other than routine individual grievances) or labor arbitration proceeding pending or, to the knowledge of the Company, threatened against the Company or its Subsidiaries, (B) to the knowledge of the Company or its Subsidiaries, activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any of its Subsidiaries, or (C) lockout, strike, slowdown, work stoppage or, to the knowledge of the Company or its Subsidiaries, written threat thereof by or with respect to any such employees.

4.21Brokerage Fees.  None of the Company or any Subsidiary of the Company has paid, or is obligated to pay, to any Person any brokerage or finder’s fees in connection with the transactions contemplated hereby or by any other Transaction Documents.

Exhibit 10.3

4.22  REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE PURCHASERS

Each Purchaser, severally and not jointly, represents and warrants to the Company as of the date hereof as follows:

4.23Purchase for Investment.

(a)Such Purchaser is acquiring the Series B-2 Preferred Stock and the 2008 Warrants for its own account, for investment purposes only and not with a view to any distribution thereof within the meaning of the Securities Act.

(b)Such Purchaser understands that the Series B-2 Preferred Stock and the 2008 Warrants have not been and, except as provided in the Registration Rights Agreement with respect to the Convert Shares, will not be registered under the Securities Act or any state or other securities law, that the Series B-2 Preferred Stock and the 2008 Warrants are being issued by the Company in transactions exempt from the registration requirements of the Securities Act, that it must hold the Series B-2 Preferred Stock indefinitely and not offer or sell the Series B-2 Preferred Stock or the 2008 Warrants except pursuant to effective registration statements under the Securities Act or pursuant to applicable exemptions from registration under the Securities Act and in compliance with applicable State laws.

(c)Such Purchaser further understands that the exemption from registration afforded by Rule 144 (the provisions of which are known to such Purchaser) promulgated under the Securities Act depends on the satisfaction of various conditions, and that, if applicable, Rule 144 may afford the basis for sales only in limited amounts.

(d)Such Purchaser did not employ any broker or finder in connection with the transactions contemplated in this Agreement and no fees or commissions are payable to the Purchasers except as otherwise provided for in this Agreement.

(e)Such Purchaser is an Accredited Investor.

(f)The source of funds to be used by such Purchaser to pay the purchase price of the Series B-2 Preferred Stock and the 2008 Warrants purchased by such Purchaser hereunder does not include assets of any employee benefit plan (other than a plan exempt from the coverage of ERISA) or plan or any other entity the assets of which consist of “plan assets” of employee benefit plans or plans as defined in Department of Labor regulation Section 2510.3-101.  As used in this Section 5.1(f), the term “employee benefit plan” shall have the meaning assigned to such term in Section 3 of ERISA, and the term “plan” shall have the meaning assigned thereto in Section 4975(e)(1) of the Code.

4.24Access to Information.  Such Purchaser has been furnished with or has had access to the information it has requested from the Company and its Subsidiaries and has had an opportunity to discuss with the management of the Company and its Subsidiaries the business and financial affairs of the Company and its Subsidiaries, and has generally such knowledge and experience in business and financial matters and with respect to investments in securities of

Exhibit 10.3

4.25privately held companies so as to enable it to understand and evaluate the risks of such investment and form an investment decision with respect thereto, and is capable of bearing the economic risks of such investment.

4.26Corporate Power; Authorization; Enforceability.  The execution, delivery and performance of this Agreement and the other Financing Documents to which such Purchaser is a party are within its corporate or limited partnership, as the case may be, power and authority and have been duly authorized by all necessary action of such Purchaser, do not conflict with or result in a breach of or violate any of such Purchaser’s governing documents or any contract to which such Purchaser is a party or by which its assets are bound or any Applicable Laws and constitute legal, valid and binding agreements of such Purchaser enforceable against it in accordance with their respective terms, subject to the Enforceability Exceptions.

4.27No Actions or Proceedings.  There are no legal or governmental actions, suits or proceedings pending or, to any Purchaser’s knowledge, threatened against or affecting such Purchaser, or any of their respective properties or assets which, if adversely determined, in the aggregate, could reasonably be expected to materially and adversely affect the ability of such Purchaser to consummate any of the transactions contemplated by the Financing Documents.

SECTION 5.  OTHER AFFIRMATIVE COVENANTS

5.1Director Representation.  At such time as the Avista Purchasers do not hold of record a sufficient number of shares of Series B Preferred Stock (without the vote of any other stockholder) to elect a director to the Board of Directors of the Company to represent the holders of Series B Preferred Stock as a separate class pursuant to the terms of the Certificate of Designation, the Board of Directors shall nominate and slate for election at each of the Company’s annual meetings of stockholders one director designated by Avista if the Avista Purchasers hold a number of shares of Common Stock and/or Series B Preferred Stock (calculated assuming the conversion of any Series B Preferred Stock held by the Avista Purchasers into Common Stock) equal to or greater than (i) 10% of the then outstanding Common Stock or (ii) 25% of the Common Stock the Avista Purchasers are entitled to upon conversion of the Series B Preferred Stock purchased by the Avista Purchasers.  

5.2Allocation of Purchase Price.  On or before December 31, 2008, the Company and the Purchasers will mutually agree on an allocation of the purchase price between the Series B-2 Preferred Stock and the 2008 Warrants issued to the Purchasers pursuant to the terms of this Agreement.

SECTION 6.  EXPENSES, INDEMNIFICATION AND CONTRIBUTION; TERMINATION

6.1Expenses.  The Company will, upon Closing, after presentation of a reasonable summary invoice therefore, reimburse the Purchasers for all reasonable expense (including reasonable and documented attorney’s and accountant’s fees and disbursements) incurred by the

Exhibit 10.3

6.2Purchasers in connection with the transactions contemplated by this Agreement and the other Financing Documents and in connection with any amendments, waivers or consents under or in respect of this Agreement or the other Financing Documents (whether or not such amendment, waiver or consent becomes effective), including, without limitation: (a) the Purchaser’s reasonable and documented out-of-pocket expenses in connection with the Purchaser’s examinations and appraisals of the Company’s properties, books and records; (b) the reasonable and documented out-of-pocket costs and expenses incurred in enforcing, defending or declaring (or determining whether or how to enforce, defend or declare) any rights or remedies under this Agreement or the other Financing Documents or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this Agreement or the other Financing Documents; and any fees incurred by the Purchasers in connection with any governmental consents or filings  (including any fees incurred in connection with any HSR Act filing).  The Company will pay, and will hold the Purchasers harmless from, all claims in respect of any fees, costs or expenses if any, of brokers and finders in relation to the Transactions.

6.3Indemnification.  The Company shall indemnify and hold harmless the Purchasers and each of their respective Affiliates, partners, stockholders, members, directors, agents, employees and controlling persons (collectively, the “Indemnitees”) from and against any and all actual losses, claims, damages or liabilities to any such Indemnitee in connection with or as a result of any misrepresentation or breach of warranty, covenant or agreement made or to be performed by the Company pursuant to this Agreement.

6.4Survival.  The obligations of the Company under this Section 7 will survive the payment or transfer of any Series B-2 Preferred Stock or 2008 Warrants, the enforcement, amendment or waiver of any provision of this Agreement and the termination of this Agreement.

6.5Tax Treatment of Indemnification Payments.  Any indemnification payment pursuant to this Agreement shall be treated for federal, state, local and foreign Tax purposes as an adjustment to the Purchase Price.

SECTION 7.  MISCELLANEOUS

7.1Notices.  Except as otherwise expressly provided herein, all notices and other communications shall have been duly given and shall be effective (a) when delivered, (b) when transmitted via telecopy (or other facsimile device) to the number set out below if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), (c) the day following the day (except if not a Business Day then the next Business Day) on which the same has been delivered prepaid to a reputable national overnight air courier service or (d) the third Business Day following the day on which the same is sent by certified or registered mail, postage prepaid, in each case to the respective parties at the address set forth below, or at such other address as such party may specify by written notice to the other party hereto:

(a)if to a Purchaser or its nominee, to the Purchaser or its nominee at the address specified for such communications in Schedule 2.2, with a copy to King & Spalding

Exhibit 10.3

(b)LLP, 1100 Louisiana, Suite 4000, Houston, Texas 77002, Attention:  Steve Rubin, Esq., or at such other address as the Purchaser or its nominee shall have specified to the Company in writing;

(c)if to the Company, to Geokinetics Inc., 1500 City West Blvd., Suite 800, Houston, Texas 77042, Attention: Richard F. Miles, with a copy to Chamberlain, Hrdlicka, White, Williams & Martin, 1200 Smith Street, 14th Floor,  Houston, Texas 77002 Attention: James J. Spring, III, Esq.

7.2Benefit of Agreement and Assignments.

(a)Nothing in this Agreement or any other Financing Document, express or implied, shall give to any Person other than the parties hereto or thereto (not including successors or assigns) any benefit or any legal or equitable right, remedy or claim under this Agreement.

(b)No party hereto may assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the other parties hereto; provided, however, that the Purchasers may assign the rights to purchase all or any portion of the Series B-2 Preferred Stock or the 2008 Warrants allocated to such Purchaser pursuant to Schedule 2.2 to any, direct or indirect, wholly owned subsidiary of such Purchaser, subject to the ability of such subsidiary to make the representations and warranties set forth in Section 5, and each such Person shall be entitled to the full benefit of this Agreement as if such Person were a Purchaser hereunder.

7.3No Waiver; Remedies Cumulative.  No failure or delay on the part of any party hereto in exercising any right, power or privilege hereunder and no course of dealing between the Company and any other party shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or under the Certificate of Designation preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder or thereunder.  The rights and remedies provided herein and in the Certificate of Designation are cumulative and not exclusive of any rights or remedies that the parties would otherwise have.  No notice to or demand on the Company in any case shall entitle the Company to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the other parties hereto to any other or further action in any circumstances without notice or demand.

7.4Amendments, Waivers and Consents.  This Agreement may be amended, and the observance of any term hereof may be waived (either retroactively or prospectively), with the written consent of the Company and the other parties hereto.  No amendment or waiver of this Agreement will extend to or affect any obligation, covenant, agreement not expressly amended or waived or thereby impair any right consequent thereon.  As used herein, the term this “Agreement” and references thereto shall mean this Agreement as it may from time to time be amended, supplemented or modified.

7.5Counterparts.  This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be an original, but all of which shall constitute one and the same instrument.  It shall not be necessary in making proof of this

Exhibit 10.3

7.6Agreement to produce or account for more than one such counterpart.  Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto.  For the purposes of the Closing, signatures transmitted via telecopy (or other facsimile device) will be accepted as original signatures if the sender on the same day sends a manually executed signature page by a recognized overnight delivery service (charges prepaid).

7.7Headings.  The headings of the sections and subsections hereof are provided for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.

7.8Survival of Covenants and Indemnities.  All covenants and indemnities set forth herein shall survive the execution and delivery of this Agreement, the issuance of the Series B-2 Preferred Stock, the 2008 Warrants and the Convert Shares and, except as otherwise expressly provided herein with respect to covenants and any other obligations hereunder.

7.9Governing Law; Submission to Jurisdiction; Venue.

(a)THIS AGREEMENT AND THE SECURITIES SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW YORK, EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH STATE.

(b)If any action, proceeding or litigation shall be brought by any Purchaser in order to enforce any right or remedy under this Agreement, the Series B-2 Preferred Stock or the 2008 Warrants, the Company hereby consents and will submit, and will cause its Subsidiaries to submit, to the jurisdiction of any state or federal court of competent jurisdiction sitting within the area comprising the Southern District of New York on the date of this Agreement.  The Company hereby irrevocably waives any objection, including, but not limited to, any objection to the laying of venue or based on the grounds of forum non conveniens, which it may now or hereafter have to the bringing of any such action, proceeding or litigation in such jurisdiction.  The Company further agrees that it shall not, and shall cause its Subsidiaries not to, bring any action, proceeding or litigation arising out of this Agreement, the Series B-2 Preferred Stock or the 2008 Warrants in any state or federal court other than any state or federal court of competent jurisdiction sitting within the area comprising the Southern District of New York on the date of this Agreement.

(c)The Company irrevocably consents to the service of process of any of the aforementioned courts in any such action, proceeding or litigation by the mailing of copies thereof by registered or certified mail, postage prepaid, to the Company at its address set forth in Section 8.1, such service to become effective thirty (30) days after such mailing.

(d)Nothing herein shall affect the right of any Purchaser to serve process in any other manner permitted by law or to commence legal proceedings or otherwise proceed against the Company in any other jurisdiction.  If service of process is made on a designated

Exhibit 10.3

(e)agent it should be made by either (i) personal delivery or (ii) mailing a copy of summons and complaint to the agent via registered or certified mail, return receipt requested.

(f)THE COMPANY AND EACH PURCHASER HEREBY WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, PROCEEDING OR LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS AGREEMENT, THE SERIES B-2 PREFERRED STOCK OR THE 2008 WARRANTS.

7.10Severability.  If any provision of this Agreement is determined to be illegal, invalid or unenforceable, such provision shall be fully severable to the extent of such illegality, invalidity or unenforceability and the remaining provisions shall remain in full force and effect and shall be construed without giving effect to the illegal, invalid or unenforceable provisions.

7.11Entirety.  This Agreement together with the other Financing Documents represents the entire agreement of the parties hereto and thereto, and supersedes all prior agreements and understandings, oral or written, if any, relating to the Financing Documents or the transactions contemplated herein or therein.

7.12Survival of Representations and Warranties.  All representations and warranties made by the Company herein shall survive the execution and delivery of this Agreement, the issuance and transfer of all or any portion of the Series B-2 Preferred Stock and the issuance of the Convert Shares in accordance with the Certificate of Designation, and any other obligations hereunder, regardless of any investigation made at any time by or on behalf of the Purchasers.

7.13Construction.  Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) be deemed to excuse compliance with any other covenant.  Where any provision herein 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, whether or not expressly specified in such provision.

7.14Incorporation.  All Exhibits and Schedules attached hereto are incorporated as part of this Agreement as if fully set forth herein.

7.15Non-Recourse.  Except as explicitly provided in this Agreement, no past, present or future director, officer, employee, incorporator, member, partner, stockholder, affiliate, agent, attorney or representative of the Company or the Purchasers shall in such capacity have any liability for any obligations or liabilities of the Company or any Purchaser, respectively, under this Agreement or for any claim (under tort or contract law) based on, in respective of, or by reason of, the transactions contemplated hereby.

7.16Further Assurances.  Each of the parties hereto shall, upon reasonable request of any other party hereto, do, make and execute all such documents, acts, matters and things as may be reasonably required in order to give effect to the transactions contemplated hereby.

Exhibit 10.3

7.17IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Agreement to be duly executed and delivered as of the date first above written.

GEOKINETICS INC.

By:  /s/ Richard F. Miles

Name:  Richard F. Miles

Title: President

Exhibit 10.3

AVISTA CAPITAL PARTNERS, L.P.

By: AVISTA CAPITAL PARTNERS GP, LLC, its general partner

By:           /s/ Jeff Gunst

Jeff Gunst,

Authorized Signatory

AVISTA CAPITAL PARTNERS (OFFSHORE), L.P.

By: AVISTA CAPITAL PARTNERS GP, LLC, its general partner

By:           /s/ Jeff Gunst

Jeff Gunst,

Authorized Signatory

0590068.5

940480-000000

Exhibit 10.3

EXHIBIT A

FORM OF CERTIFICATE OF DESIGNATION

Exhibit 10.3

EXHIBIT B

FORM OF 2008 WARRANT

Exhibit 10.3

EXHIBIT C

FORM OF REGISTRATION RIGHTS AGREEMENT

Exhibit 10.3

EXHIBIT D

FORM OF OPINION

Exhibit 10.3

EXHIBIT E

FORM OF MANAGEMENT RIGHTS AGREEMENT

Geokinetics Inc., a Delaware corporation (the “Portfolio Company”), hereby agrees that as of the date hereof, Avista Capital Partners, L.P., a Delaware limited partnership (the “Partnership”), shall have the following rights so long as it owns any equity interests in the Portfolio Company:

(i) the right to receive prior notice of all material corporate actions of the Portfolio Company and its subsidiaries and the right to consult with the Portfolio Company and its subsidiaries with respect to such actions;

(ii) the right to visit and inspect any of the offices and properties of the Portfolio Company and its subsidiaries and inspect and copy the books and records of the Portfolio Company and its subsidiaries, at such times as the Partnership or its designated representatives shall reasonably request;

(iii) the right to consult with appropriate officers and directors of the Portfolio Company and each of its subsidiaries routinely and at such times as reasonably requested by the Partnership with respect to matters relating to the business, finances, accounts and affairs of the Portfolio Company and its subsidiaries; and

(iv) such information and consultation rights or other assistance as the Partnership may require to preserve its qualification as a venture capital operating company (as defined in the U.S. Department of Labor Plan Asset Regulation, 29 C.F.R. § 2510.3-101) including, but not limited to, by reason of the Partnership’s interest in the Portfolio Company qualifying as a venture capital investment (as defined in the U.S. Department of Labor Plan Asset Regulation, 29 C.F.R. § 2510.3-101).

The Portfolio Company acknowledges and agrees that the Partnership may exercise its rights under this agreement through its general partner or such other person designated by the Partnership, in each case acting on behalf of the Partnership.

Dated:  July ____, 2008

Geokinetics Inc.

By:  Richard F. Miles, President

Agreed and Accepted:

Avista Capital Partners, L.P.

By:  Avista Capital Partners GP, LLC,

its general partner

By:                                                      

      Jeff Gunst, Authorized Signatory

EX-10.4

AMENDED AND RESTATED

REGISTRATION RIGHTS AGREEMENT

This AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this “Agreement”) dated July 28, 2008, is among Geokinetics Inc., a Delaware corporation (including its successors, the “Company”), Avista Capital Partners, L.P., a Delaware limited partnership, Avista Capital Partners (Offshore), L.P., a Bermuda limited partnership (together with Avista Capital Partners, L.P., the “Avista Holders”) and Levant America S.A., a Liberian corporation (collectively, with the Avista Holders, the “Security Holders”).  This Agreement supersedes the Registration Rights Agreement dated as of September 8, 2006 between the Company and certain of the Security Holders, as amended by that certain Amendment Number 1 dated as of May 15, 2007.

RECITALS

WHEREAS, the Company and certain of the Security Holders are parties to that certain Registration Rights Agreement dated as of September 8, 2006 (the “Registration Rights Agreement”);

WHEREAS, the Company and certain of the Security Holders are parties to the Series B-2 and Warrant Purchase Agreement of even date herewith (the “Purchase Agreement”);

WHEREAS, under the Purchase Agreement, certain of the Security Holders will purchase shares of Series B-2 Senior Convertible Preferred Stock, par value $10.00 per share (the “Series B-2 Preferred Stock”), warrants (the “2008 Warrants“) to purchase shares of Common Stock, par value $0.01 per share (“Common Stock“) of the Company; and

WHEREAS, the Series B-2 Preferred Stock and the Company’s Series B-1 Senior Convertible Preferred Stock, par value $10.00 per share (the “Series B-1 Preferred Stock”), are convertible into shares of the Company’s Common Stock.

WHEREAS, in order to induce certain of the Security Holders to enter into the Purchase Agreement, and to purchase the Series B-2 Preferred Stock and the 2008 Warrants, the parties have agreed to amend and restate the Registration Rights Agreement and enter into this Agreement to provide the purchasers of Series B-2 Preferred Stock with certain registration rights with respect to the shares of Common Stock into which the Series B-2 Preferred Stock is convertible and which may be purchased upon exercise of the 2008 Warrants.

NOW, THEREFORE, in consideration of the premises, mutual covenants and agreements hereinafter contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

Exhibit 10.4

DEFINITIONS

1.1Definitions.

(a)For purposes of this Agreement, defined terms used herein which are not otherwise defined herein shall have the same respective meanings as such terms have in the Purchase Agreement, and in addition, the following terms shall have the meanings specified in this Section 1.1.

“Affiliate” means, with respect to any Person, any Person who, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with any Person.

“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks are authorized or required to close under the laws of the United States or the State of New York.

“Common Stock Equivalents” means, without duplication with any other Common Stock or Common Stock Equivalents, any rights, warrants, options, convertible securities or indebtedness, exchangeable securities or indebtedness, or other rights, exercisable for or convertible or exchangeable into, directly or indirectly, Common Stock of the Company and securities convertible or exchangeable into Common Stock of the Company, whether at the time of issuance or upon the passage of time or the occurrence of any future event.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any similar federal statute, and the rules and regulations promulgated by the SEC thereunder.

“Excluded Registration” means a registration under the Securities Act of (i) securities registered on Form S-8 or any similar successor form and (ii) securities registered to effect the acquisition of or combination with another Person.

“Holder” means (i) a Security Holder listed on the signature page hereof and (ii) any direct or indirect transferee of any such Security Holder, including any Security Holder that receives shares of Common Stock upon a distribution or liquidation of a Holder, who has been assigned the rights of the transferor Holder under this Agreement in accordance with Section 2.3.

“Person” or “person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization or government or other agency or political subdivision thereof.

“Preferred Stock” means the Company’s Series B-1 Preferred Stock and Series B-2 Preferred Stock.

Exhibit 10.4

“register,” “registered” and “registration” refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of the effectiveness of such registration statement.

“Registrable Shares” means, at any time, the Common Stock (including, but not limited to, the Common Stock acquired upon conversion of Preferred Stock of the Company or exercise of the Company's 2008 Warrants) and Preferred Stock of the Company owned by the Holders, whether owned on the date hereof or acquired hereafter; provided, however, to the extent any determination of the number or percentage of Registrable Shares is made under the terms of this Agreement, all Preferred Stock shall be included with all Common Stock on as converted basis for the purpose of any such determination; provided, further, that Registrable Shares shall not include any shares (i) the sale of which has been registered pursuant to the Securities Act and which shares have been sold pursuant to such registration or (ii) which have been sold pursuant to Rule 144 under the Securities Act.

“Required Holders” means Holders who then own beneficially more than 50% of the aggregate number of shares of Registrable Shares subject to this Agreement.

“SEC” means the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act.

“Securities Act” means the Securities Act of 1933, as amended, or any similar Federal statute, and the rules and regulations promulgated by the SEC thereunder.

“Subsidiary” means any entity with respect to which a specified Person (or a Subsidiary thereof) owns or has the power to vote 50% or more of the equity interests in such entity, having general voting power to participate in the election of the governing body of such entity.

(a)“2008 Warrants” means the Warrants to purchase shares of the Company's Common Stock which have been issued to certain Security Holders simultaneously with their purchase of shares of Series B-2 Preferred Stock.

(b)For purposes of this Agreement, the following terms have the meanings set forth in the sections indicated:

Exhibit 10.4

(c)Term                                                                                     Section

Advice	2.6
Agreement	Introductory Paragraph
Avista Holders	Recitals
Common Stock	Recitals
Company	Introductory Paragraph
Company Shelf	2.1(i)
Company Shelf Shares	2.1(i)
Demand Registration	2.1(a)
Demand Request	2.1(a)
Inspectors	2.5(j)
Material Adverse Effect	2.1(e)
NASD	2.5(l)
Preferred Stock	1.1(a)
Purchase Agreement	Recitals
Records	2.5(j)
Registration Expenses	2.7
Requesting Holders	2.1(a)
Required Filing Date	2.1(b)
Security Holders	Introductory Paragraph
Seller Affiliates	2.8(a)
Series B-1 Preferred Stock	Recitals
Series B-2 Preferred Stock	Recitals
Shelf Offering	2.1(f)
Suspension Notice	2.6
Underwritten Offering	2.1(d)

1.2Other Definitional and Interpretive Matters.  Unless otherwise expressly provided or the context otherwise requires, for purposes of this Agreement the following rules of interpretation apply.

(a)When calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period is excluded.  If the last day of such period is a non-Business Day, the period in question ends on the next succeeding Business Day.

(b)Any reference in this Agreement to $ means U.S. dollars.

(c)The Schedules to this Agreement are hereby incorporated and made a part hereof as if set forth in full in this Agreement and are an integral part of this Agreement.  Any capitalized terms used in any Schedule but not otherwise defined therein are defined as set forth in this Agreement.

Exhibit 10.4

(d)Any reference in this Agreement to gender includes all genders, and words imparting the singular number also include the plural and vice versa.

(e)The provision of a Table of Contents, the division of this Agreement into Articles, Sections and other subdivisions and the insertion of headings are for convenience of reference only and do not affect, and should not be utilized in, the construction or interpretation of this Agreement.

(f)All references in this Agreement to any “Article,” “Section,” or “Schedule” are to the corresponding Article, Section, Schedule or Exhibit of this Agreement.

(g)The words “herein,” “hereinafter,” “hereof,” and “hereunder” refer to this Agreement as a whole and not merely to a subdivision in which such words appear unless the context otherwise requires.

(h)The word “including” or any variation thereof means “including, but not limited to,” and does not limit any general statement that it follows to the specific or similar items or matters immediately following it.

ARTICLE II  - REGISTRATION RIGHTS

2.1Demand Registration.

(a)At any time after the Closing Date, any Avista Holder may request, in writing (a “Demand Request”), that the Company effect the registration under the Securities Act of all or part of its or their Registrable Shares (a “Demand Registration”).  Notwithstanding the foregoing, no Demand Request will be effective hereunder unless the Registrable Shares proposed to be sold by the Avista Holders requesting the Demand Registration (the “Requesting Holders,” which term shall include parties deemed “Requesting Holders” pursuant to Section 2.1(f) hereof) represent, in the aggregate, more than 25% of the total number of Registrable Shares held by all Avista Holders.

(b)Each Demand Request shall specify the number of Registrable Shares proposed to be sold and the intended method of disposition of the Registrable Shares (including an Underwritten Offering pursuant to Section 2.1(d) or a Shelf Registration pursuant to Section 2.1(f)).  Subject to Section 2.1(h), the Company shall file the Demand Registration within 90 days after receiving a Demand Request (the “Required Filing Date”) and shall use all commercially reasonable efforts to cause the same to be declared effective by the SEC as promptly as practicable after such filing; provided, however, that the Company need effect only three (3)Demand Registrations pursuant to Demand Requests made by Holders of Registrable Shares pursuant to Section 2.1(a); provided, further, that if any Registrable Shares requested to be registered pursuant to a Demand Request are excluded from the applicable Demand

Exhibit 10.4

(c)Registration pursuant to Section 2.1(e) below, the Holders shall have the right, with respect to each such exclusion, to request one additional Demand Registration.

(d)A registration will not count as a Demand Registration until it has become effective (unless the Requesting Holders withdraw all their Registrable Shares and the Company has performed its obligations hereunder in all material respects, in which case such demand will count as a Demand Registration unless the Requesting Holders pay all Registration Expenses, as hereinafter defined, in connection with such withdrawn registration); provided, however, that if, after it has become effective, an offering of Registrable Shares pursuant to a registration is interfered with by any stop order, injunction or other order or requirement of the SEC or other governmental agency or court, such registration will be deemed not to have been effected and will not count as a Demand Registration.

(e)The Requesting Holders may provide in the Demand Request that the offering of Registrable Shares pursuant to a Demand Registration shall be in the form of a “firm commitment” underwritten offering (an “Underwritten Offering”).  The Requesting Holders of a majority of the Registrable Shares to be registered in a Demand Registration shall select the investment banking firm or firms to manage the Underwritten Offering, provided that such selection shall be subject to the consent of the Company, which consent shall not be unreasonably withheld.  No Person may participate in any registration pursuant to Section 2.1(a) unless such Person (i) agrees to sell such Person’s Registrable Shares on the basis provided in any underwriting arrangements described above and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements; provided, however, that no such Person shall be required to make any representations or warranties in connection with any such registration other than representations and warranties as to (A) such Person’s ownership of his or its Registrable Shares to be transferred free and clear of all liens, claims and encumbrances, (B) such Person’s power and authority to effect such transfer and (C) such matters pertaining to compliance with securities laws as may be reasonably requested; provided, further, however, that the obligation of such Person to indemnify pursuant to any such underwriting arrangements shall be several, not joint and several, among such Persons selling Registrable Shares, and the liability of each such Person will be in proportion thereto, and provided, further, that such liability will be limited to the net amount received by such Person from the sale of his or its Registrable Shares pursuant to such registration.

(f)No securities to be sold for the account of any Person (including the Company) other than a Requesting Holder shall be included in a Demand Registration for an Underwritten Offering unless the managing underwriter or underwriters shall advise the Company or the Requesting Holders

Exhibit 10.4

(g)in writing that the inclusion of such securities will not materially and adversely affect the price or success of the Underwritten Offering (a “Material Adverse Effect”).  Furthermore, in the event the managing underwriter or underwriters shall advise the Company or the Requesting Holders that even after exclusion of all securities of other Persons pursuant to the immediately preceding sentence, the amount of Registrable Shares proposed to be included in such Demand Registration by Requesting Holders is sufficiently large to cause a Material Adverse Effect, the Registrable Shares of the Requesting Holders to be included in such Demand Registration shall equal the number of shares which the Company is so advised can be sold in such offering without a Material Adverse Effect and such shares shall be allocated pro rata among the Requesting Holders on the basis of the number of Registrable Shares requested to be included in such registration by each such Requesting Holder.

(h)The Requesting Holders may provide in the Demand Request that the offering of Registrable Shares pursuant to a Demand Registration shall be in the form of a “shelf offering” under the Securities Act to be made on a continuous basis pursuant to Rule 415 (a “Shelf Offering”).  The Shelf Offering shall be on Form S-1 (or on Form S-3, if the Company is eligible to utilize such Form to register its shares).  Subject to the terms of this Agreement, the Company shall use its best efforts to cause the Shelf Offering to be declared effective under the Securities Act as promptly as possible after the filing thereof and shall use its best efforts to keep such Shelf Offering continuously effective under the Securities Act until all Registrable Securities covered by such Shelf Offering have been sold or may be sold without volume restrictions pursuant to Rule 144(k) as determined by the counsel to the Company pursuant to a written opinion letter to such effect, addressed and acceptable to the Company’s transfer agent and the affected Avista Holders. 

(i)Upon receipt of any Demand Request, the Company shall promptly (but in any event within 10 days) give written notice of such proposed Demand Registration to all other Holders, who shall have the right, exercisable by written notice to the Company within 20 days of their receipt of the Company’s notice, to elect to include in such Demand Registration such portion of their Registrable Shares as they may request.  All Holders requesting to have their Registrable Shares included in a Demand Registration in accordance with the preceding sentence shall be deemed to be “Requesting Holders” for purposes of this Section 2.1(g).

(j)The Company may defer the filing (but not the preparation) of a registration statement required by Section 2.1(a) until a date not later than 90 days after the Required Filing Date (or, if longer, 90 days after the effective date of the registration statement contemplated by clause (ii) below) if (i) at the time the Company receives the Demand Request, the Company or any of its Subsidiaries are engaged in confidential negotiations or other confidential business activities, disclosure of which would be required in such registration

Exhibit 10.4

(k)statement (but would not be required if such registration statement were not filed), and the Board of Directors of the Company determines in good faith that such disclosure would be materially detrimental to the Company and its stockholders or (ii) prior to receiving the Demand Request, the Board of Directors had determined to effect a registered underwritten public offering of the Company’s securities for the Company’s account and the Company had taken substantial steps (including, but not limited to, selecting a managing underwriter for such offering) and is proceeding with reasonable diligence to effect such offering.  A deferral of the filing of a registration statement pursuant to this Section 2.1(h) shall be lifted, and the requested registration statement shall be filed forthwith, if, in the case of a deferral pursuant to clause (i) of the preceding sentence, the negotiations or other activities are disclosed or terminated, or, in the case of a deferral pursuant to clause (ii) of the preceding sentence, the proposed registration for the Company’s account is abandoned.  In order to defer the filing of a registration statement pursuant to this Section 2.1(h), the Company shall promptly (but in any event within ten days), upon determining to seek such deferral, deliver to each Requesting Holder a certificate signed by an executive officer of the Company stating that the Company is deferring such filing pursuant to this Section 2.1(h) and a general statement of the reason for such deferral and an approximation of the anticipated delay.  Within 20 days after receiving such certificate, the holders of a majority of the Registrable Shares held by the Requesting Holders and for which registration was previously requested may withdraw such Demand Request by giving notice to the Company; if withdrawn, the Demand Request shall be deemed not to have been made for all purposes of this Agreement.  The Company may defer the filing of a particular registration statement pursuant to this Section 2.1(h) only once.

(l)In lieu of any of the three Demand Registrations and if the Company has established a “shelf offering” of newly issued shares of Common Stock (the “Company Shelf Shares”) under the Securities Act to be made on a continuous basis pursuant to Rule 415 on Form S-3 (the “Company Shelf”), the Avista Holders may issue a Demand Request for the Company to sell Company Shelf Shares and use the proceeds from such sales to purchase the Registrable Shares held by the Requesting Holders (the “Shelf Funded Repurchase”) at a price equal to the price at which the Company Shelf Shares were sold less any underwriting discounts and commissions.  Subject to the terms of this Agreement, the Company shall use its best efforts to keep such Company Shelf continuously effective under the Securities Act until all Registrable Securities included in the applicable Demand Request have been purchased by the Company or may be sold without volume restrictions pursuant to Rule 144(k) as determined by the counsel to the Company pursuant to a written opinion letter to such effect, addressed and acceptable to the Company’s transfer agent and the affected Avista Holders.   The Company will not be responsible for any fees or expenses incurred by the Avista Holders in connection with the Shelf Funded Repurchase other than as provided in Section 2.7 hereto.

Exhibit 10.4

(m)Piggyback Registrations.

(n)Each time the Company proposes to register any of its equity securities (other than pursuant to an Excluded Registration) under the Securities Act for sale to the public (whether for the account of the Company or the account of any Security Holders of the Company) and the form of registration statement to be used permits the registration of Registrable Shares, the Company shall give prompt written notice to each Holder of Registrable Shares (which notice shall be given not less than 30 days prior to the effective date of the Company’s registration statement), which notice shall offer each such Holder the opportunity to include any or all of its or his Registrable Shares in such registration statement, subject to the limitations contained in Section 2.2(b) hereof.  Each Holder who desires to have its or his Registrable Shares included in such registration statement shall so advise the Company in writing (stating the number of shares desired to be registered) within 20 days after the date of such notice from the Company.  Any Holder shall have the right to withdraw such Holder’s request for inclusion of such Holder’s Registrable Shares in any registration statement pursuant to this Section 2.2(a) by giving written notice to the Company of such withdrawal.  Subject to Section 2.2(b) below, the Company shall include in such registration statement all such Registrable Shares so requested to be included therein; provided, however, that the Company may at any time withdraw or cease proceeding with any such registration if it shall at the same time withdraw or cease proceeding with the registration of all other equity securities originally proposed to be registered.

(o)If the managing underwriter advises the Company that the inclusion of Registrable Shares requested to be included in the registration statement would cause a Material Adverse Effect, the Company will be obligated to include in the registration statement, as to each Requesting Holder, only a portion of the shares such Holder has requested be registered equal to the product of: (i) the ratio which such Holder’s requested shares bears to the total number of shares requested to be included in such registration statement by all Persons (including Requesting Holders) who have requested (pursuant to contractual registration rights) that their shares be included in such registration statement; and (ii) the maximum number of shares that the managing underwriter advises may be sold in an offering covered by the registration statement without a Material Adverse Effect.  If as a result of the provisions of this Section 2.2(b) any Holder shall not be entitled to include all Registrable Shares in a registration that such Holder has requested to be so included, such Holder may withdraw such Holder’s request to include Registrable Shares in such registration statement.  No Person may participate in any registration statement hereunder unless such Person (i) agrees to sell such person’s Registrable Shares on the basis provided in any underwriting arrangements approved by the Company and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents, each in customary form, reasonably required under the terms of such underwriting arrangements; provided, however, that no

Exhibit 10.4

(p)such Person shall be required to make any representations or warranties in connection with any such registration other than representations and warranties as to (A) such Person’s ownership of his or its Registrable Shares to be sold or transferred free and clear of all liens, claims and encumbrances, (B) such Person’s power and authority to effect such transfer and (C) such matters pertaining to compliance with securities laws as may be reasonably requested; provided, further, however, that the obligation of such Person to indemnify pursuant to any such underwriting arrangements shall be several, not joint and several, among such Persons selling Registrable Shares, and the liability of each such Person will be in proportion to, and provided, further, that such liability will be limited, to the net amount received by such Person from the sale of his or its Registrable Shares pursuant to such registration.

2.2Transfer of Registration Rights.  The rights of each Holder under this Agreement may be assigned to a transferee or assignee of at least 50,000shares (on a fully basis as adjusted for stock splits, stock dividends, recapitalizations and the like) of a Holder’s Registrable Shares not sold to the public; provided, however, that the Company is given: (a) written notice by such Holder at or within a reasonable time after said transfer, stating the name and address of such transferee or assignee and identifying the securities with respect to which such registration rights are being transferred or assigned; and (b) a joinder agreement, in a form reasonably satisfactory to the Company, executed by such assignee pursuant to which such assignee agrees to be bound by the terms of this Agreement.  Notwithstanding the foregoing, any Holder may transfer rights to a transferee of fewer than 50,000 shares (on a fully basis as adjusted for stock splits, stock dividends, recapitalizations and the like) of a Holder’s Registrable Shares if such transferee is (a) any affiliate, control person, controlled person, partner or retired partner of any Holder or (b) any family member or trust for the benefit of any individual Holder.

2.3Holdback Agreement.  Unless the managing underwriter otherwise agrees, each of the Company and the Holders agrees (and the Company agrees, in connection with any underwritten registration, to use its commercially reasonable efforts to cause its Affiliates to agree) not to effect any public sale or private offer or distribution of any Common Stock or Common Stock Equivalents during the ten Business Days prior to the effectiveness under the Securities Act of any underwritten registration and during such time period after the effectiveness under the Securities Act of any underwritten registration (not to exceed 90 days) as the Company and the managing underwriter may agree.  Notwithstanding the foregoing, this Section 2.4 shall not apply unless all then officers and directors of the Company and each holder of securities representing 1% or more of the outstanding securities of the Company enter into similar agreements.  Any discretionary waiver or termination of the requirements under the foregoing provisions made by the managing underwriter shall apply to each seller of Registrable Shares on a pro rata basis in accordance with the number of Registrable Shares held by each seller.

Exhibit 10.4

2.4Registration Procedures.  Whenever any Holder has requested that any Registrable Shares be registered pursuant to this Agreement, the Company will use its commercially reasonable efforts to effect the registration and the sale of such Registrable Shares in accordance with the intended method of disposition thereof, and pursuant thereto the Company will as expeditiously as possible:

(a)prepare and file with the SEC a registration statement on any appropriate form under the Securities Act with respect to such Registrable Shares and use its commercially reasonable efforts to cause such registration statement to become effective;

(b)prepare and file with the SEC such amendments, post-effective amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such registration statement effective until all of the shares subject to such offering have been sold (or such lesser period as is necessary for the underwriters in an Underwritten Offering to sell unsold allotments) and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement during such period in accordance with the intended methods of disposition by the sellers thereof set forth in such registration statement;

(c)furnish to each seller of Registrable Shares and the underwriters of the securities being registered such number of copies of such registration statement, each amendment and supplement thereto, the prospectus included in such registration statement (including each preliminary prospectus), any documents incorporated by reference therein and such other documents as such seller or underwriters may reasonably request in order to facilitate the disposition of the Registrable Shares owned by such seller or the sale of such securities by such underwriters (it being understood that, subject to Section 2.6 and the requirements of the Securities Act and applicable state securities laws, the Company consents to the use of the prospectus and any amendment or supplement thereto by each seller and the underwriters in connection with the offering and sale of the Registrable Shares covered by the registration statement of which such prospectus, amendment or supplement is a part);

(d)use its commercially reasonable efforts to register or qualify the Registrable Shares under the other securities or blue sky laws of the jurisdictions as the managing underwriter reasonably requests (or, in the event the registration statement does not relate to an Underwritten Offering, as the holders of a majority of the Registrable Shares may reasonably request); use its commercially reasonable efforts to keep each such registration or qualification (or exemption therefrom) effective during the period in which the registration statement is required to be kept effective; and do any and all other acts and things which may be reasonably necessary or advisable to enable each seller to consummate the disposition of the Registrable Shares owned by such seller in

Exhibit 10.4

(e)such jurisdictions (provided, however, that the Company will not be required to (i) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph or (ii) consent to general service of process in any such jurisdiction);

(f)promptly notify each seller and each underwriter and if requested by any such Person, confirm such notice in writing (i) when a prospectus or any prospectus supplement or post-effective amendment has been filed and, with respect to a registration statement or any post-effective amendment, when the same has become effective, (ii) of the issuance by any state securities or other regulatory authority of any order suspending the qualification or exemption from qualification of any of the Registrable Shares under state securities or “blue sky” laws or the initiation of any proceedings for that purpose and (iii) of the happening of any event which makes any statement made in a registration statement or related prospectus untrue or which requires the making of any changes in such registration statement, prospectus or documents so that they will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and, as promptly as practicable thereafter, prepare and file with the SEC and furnish a supplement or amendment to such prospectus so that, as thereafter deliverable to the purchasers of such Registrable Shares, such prospectus will not contain any untrue statement of a material fact or omit a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading;

(g)make generally available to the Company’s Security Holders an earnings statement satisfying the provisions of Section 11(a) of the Securities Act no later than 30 days after the end of the 12 month period beginning with the first day of the Company’s first fiscal quarter commencing after the effective date of a registration statement, which earnings statement shall cover said 12 month period, and which requirement will be deemed to be satisfied if the Company timely files complete and accurate information on Forms 10-Q, 10-K and 8-K under the Exchange Act and otherwise complies with Rule 158 under the Securities Act;

(h)if requested by the managing underwriter or any seller promptly incorporate in a prospectus supplement or post-effective amendment such information as the managing underwriter or any seller reasonably requests to be included therein, including, without limitation, with respect to the Registrable Shares being sold by such seller, the purchase price being paid therefor by the underwriters and with respect to any other terms of the Underwritten Offering of the Registrable Shares to be sold in such offering, and promptly make all required filings of such prospectus supplement or post-effective amendment;

(i)as promptly as practicable after filing with the SEC of any document which is incorporated by reference into a registration statement (in the

Exhibit 10.4

(j)form in which it was incorporated), deliver a copy of each such document to each seller;

(k)cooperate with the sellers and the managing underwriter to facilitate the timely preparation and delivery of certificates (which shall not bear any restrictive legends unless required under applicable law) representing securities sold under any registration statement, and enable such securities to be in such denominations and registered in such names as the managing underwriter or such sellers may request and keep available and make available to the Company’s transfer agent prior to the effectiveness of such registration statement a supply of such certificates;

(l)promptly make available for inspection by any seller, any underwriter participating in any disposition pursuant to any registration statement, and any attorney, accountant or other agent or representative retained by any such seller or underwriter (collectively, the “Inspectors”), all financial and other records, pertinent corporate documents and properties of the Company (collectively, the “Records”), as shall be reasonably necessary to enable them to exercise their due diligence responsibility, and cause the Company’s officers, directors and employees to supply all information requested by any such Inspector in connection with such registration statement; provided, however, that, unless the disclosure of such Records is necessary to avoid or correct a misstatement or omission in the registration statement or the release of such Records is ordered pursuant to a subpoena or other order from a court of competent jurisdiction, the Company shall not be required to provide any information under this subparagraph (j) if (i) the Company believes, after consultation with counsel for the Company, that to do so would cause the Company to forfeit an attorney-client privilege that was applicable to such information or (ii) if either (A) the Company has requested and been granted from the SEC confidential treatment of such information contained in any filing with the SEC or documents provided supplementally or otherwise or (B) the Company reasonably determines in good faith that such Records are confidential and so notifies the Inspectors in writing unless prior to furnishing any such information with respect to (i) or (ii) such Holder of Registrable Shares requesting such information agrees to enter into a confidentiality agreement in customary form and subject to customary exceptions; and provided, further, that each Holder of Registrable Shares agrees that it will, upon learning that disclosure of such Records is sought in a court of competent jurisdiction, give notice to the Company and allow the Company, at its expense, to undertake appropriate action and to prevent disclosure of the Records deemed confidential;

(m)furnish to each seller and underwriter a signed counterpart of (i) an opinion or opinions of counsel to the Company and (ii) a comfort letter or comfort letters from the Company’s independent public accountants, each in customary form and covering such matters of the type customarily covered by

Exhibit 10.4

(n)opinions or comfort letters, as the case may be, as the sellers or managing underwriter reasonably requests;

(o)cause the Registrable Shares included in any registration statement to be (i) listed on each securities exchange, if any, on which similar securities issued by the Company are then listed or (ii) authorized to be quoted and/or listed (to the extent applicable) on the National Association of Securities Dealers, Inc. (“NASD”).  Automated Quotation System or the Nasdaq National Market if the Registrable Shares so qualify;

(p)provide a transfer agent and registrar for all Registrable Shares registered hereunder and provide a CUSIP number for the Registrable Shares included in any registration statement not later than the effective date of such registration statement;

(q)cooperate with each seller and each underwriter participating in the disposition of such Registrable Shares and their respective counsel in connection with any filings required to be made with the NASD;

(r)during the period when the prospectus is required to be delivered under the Securities Act, promptly file all documents required to be filed with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act;

(s)notify each seller of Registrable Shares promptly of any request by the SEC for the amending or supplementing of such registration statement or prospectus or for additional information;

(t)prepare and file with the SEC promptly any amendments or supplements to such registration statement or prospectus which, in the opinion of counsel for the Company or the managing underwriter, is required in connection with the distribution of the Registrable Shares;

(u)enter into such agreements (including underwriting agreements in the managing underwriter’s customary form) as are customary in connection with an underwritten registration; and

(v)advise each seller of such Registrable Shares, promptly after it shall receive notice or obtain knowledge thereof, of the issuance of any stop order by the SEC suspending the effectiveness of such registration statement or the initiation or threatening of any proceeding for such purpose and promptly use its best efforts to prevent the issuance of any stop order or to obtain its withdrawal at the earliest possible moment if such stop order should be issued.

2.5Suspension of Dispositions.  Each Holder agrees by acquisition of any Registrable Shares that, upon receipt of any notice (a “Suspension Notice”) from the Company of the happening of any event of the kind described in Section

Exhibit 10.4

2.62.5(e)(iii) such Holder will forthwith discontinue disposition of Registrable Shares until such Holder’s receipt of the copies of the supplemented or amended prospectus, or until it is advised in writing (the “Advice”) by the Company that the use of the prospectus may be resumed, and has received copies of any additional or supplemental filings which are incorporated by reference in the prospectus, and, if so directed by the Company, such Holder will deliver to the Company all copies, other than permanent file copies then in such Holder’s possession, of the prospectus covering such Registrable Shares current at the time of receipt of such notice.  In the event the Company shall give any such notice, the time period regarding the effectiveness of registration statements set forth in Section 2.5(b) hereof shall be extended by the number of days during the period from and including the date of the giving of the Suspension Notice to and including the date when each seller of Registrable Shares covered by such registration statement shall have received the copies of the supplemented or amended prospectus or the Advice.  The Company shall use its commercially reasonable efforts and take such actions as are reasonably necessary to render the Advice as promptly as practicable.

2.7Registration Expenses.  All expenses incident to the Company’s performance of or compliance with this Article II including, without limitation, all registration and filing fees, all fees and expenses associated with filings required to be made with the NASD (including, if applicable, the fees and expenses of any “qualified independent underwriter” as such term is defined in Schedule E of the By-Laws of the NASD, and of its counsel), as may be required by the rules and regulations of the NASD, fees and expenses of compliance with securities or “blue sky” laws (including reasonable fees and disbursements of counsel in connection with “blue sky” qualifications of the Registrable Shares), rating agency fees, printing expenses (including expenses of printing certificates for the Registrable Shares in a form eligible for deposit with Depository Trust Company and of printing prospectuses if the printing of prospectuses is requested by a holder of Registrable Shares), messenger and delivery expenses, the Company’s internal expenses (including without limitation all salaries and expenses of its officers and employees performing legal or accounting duties), the fees and expenses incurred in connection with any listing of the Registrable Shares, fees and expenses of counsel for the Company and its independent certified public accountants (including the expenses of any special audit or “cold comfort” letters required by or incident to such performance), securities acts liability insurance (if the Company elects to obtain such insurance), the fees and expenses of any special experts retained by the Company in connection with such registration, and the fees and expenses of other persons retained by the Company and reasonable fees and expenses of one firm of counsel for the sellers (which shall be selected by the holders of a majority of the Registrable Shares being included in any particular registration statement) (all such expenses being herein called “RegistrationExpenses”) will be borne by the Company whether or not any registration statement becomes effective; provided, however, that in no event shall Registration Expenses include any underwriting discounts, commissions or fees

Exhibit 10.4

2.8attributable to the sale of the Registrable Shares or any counsel (except as provided above), accountants or other persons retained or employed by the Holders.

2.9Indemnification.

(a)The Company agrees to indemnify and reimburse, to the fullest extent permitted by law, each seller of Registrable Shares, and each of its employees, advisors, agents, representatives, partners, officers, and directors and each Person who controls such seller (within the meaning of the Securities Act or the Exchange Act) and any agent or investment advisor thereof (collectively, the “Seller Affiliates”) (i) against any and all losses, claims, damages, liabilities and expenses, joint or several (including, without limitation, attorneys’ fees and disbursements except as limited by Section 2.8(c)) based upon, arising out of, related to or resulting from any untrue or alleged untrue statement of a material fact contained in any registration statement, prospectus or preliminary prospectus or any amendment thereof or supplement thereto, or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) against any and all losses, liabilities, claims, damages and expenses whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation or investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon, arising out of, related to or resulting from any such untrue statement or omission or alleged untrue statement or omission, and (iii) against any and all costs and expenses (including reasonable fees and disbursements of counsel) as may be reasonably incurred in investigating, preparing or defending against any litigation, investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon, arising out of, related to or resulting from any such untrue statement or omission or alleged untrue statement or omission, or such violation of the Securities Act or Exchange Act, to the extent that any such expense or cost is not paid under subparagraph (i) or (ii) above; except insofar as any such statements are made in reliance upon and in strict conformity with information furnished in writing to the Company by such seller or any Seller Affiliate for use therein or arise from such seller’s or any Seller Affiliate’s failure to deliver a copy of the registration statement or prospectus or any amendments or supplements thereto after the Company has furnished such seller or Seller Affiliate with a sufficient number of copies of the same.  The reimbursements required by this Section 2.8(a) will be made by periodic payments during the course of the investigation or defense, as and when bills are received or expenses incurred.

(b)In connection with any registration statement in which a seller of Registrable Shares is participating, each such seller will furnish to the Company in writing such information and affidavits as the Company reasonably requests for use in connection with any such registration statement or prospectus

Exhibit 10.4

(c)and, to the fullest extent permitted by law, each such seller will indemnify the Company and its directors and officers and each Person who controls the Company (within the meaning of the Securities Act or the Exchange Act) against any and all losses, claims, damages, liabilities and expenses (including, without limitation, reasonable attorneys’ fees and disbursements except as limited by Section 2.8(c)) resulting from any untrue statement or alleged untrue statement of a material fact contained in the registration statement, prospectus or any preliminary prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that such untrue statement or alleged untrue statement or omission or alleged omission is contained in any information or affidavit so furnished in writing by such seller or any of its Seller Affiliates specifically for inclusion in the registration statement; provided that the obligation to indemnify will be several, not joint and several, among such sellers of Registrable Shares, and the liability of each such seller of Registrable Shares will be in proportion to, and, provided, further, that such liability will be limited to, the net amount received by such seller from the sale of Registrable Shares pursuant to such registration statement; provided, however, that such seller of Registrable Shares shall not be liable in any such case to the extent that prior to the filing of any such registration statement or prospectus or amendment thereof or supplement thereto, such seller has furnished in writing to the Company information expressly for use in such registration statement or prospectus or any amendment thereof or supplement thereto which corrected or made not misleading information previously furnished to the Company.

(d)Any Person entitled to indemnification hereunder will (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that the failure to give such notice shall not limit the rights of such Person) and (ii) unless in such indemnified party’s reasonable judgment a conflict of interest between such indemnified and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party; provided, however, that any person entitled to indemnification hereunder shall have the right to employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of such person unless (A) the indemnifying party has agreed to pay such fees or expenses or (B) the indemnifying party shall have failed to assume the defense of such claim and employ counsel reasonably satisfactory to such person.  If such defense is not assumed by the indemnifying party as permitted hereunder, the indemnifying party will not be subject to any liability for any settlement made by the indemnified party without its consent (but such consent will not be unreasonably withheld).  If such defense is assumed by the indemnifying party pursuant to the provisions hereof, such indemnifying party shall not settle or otherwise compromise the applicable claim unless (i) such settlement or compromise contains a full and unconditional release of the

Exhibit 10.4

(e)indemnified party or (ii) the indemnified party otherwise consents in writing.  An indemnifying party who is not entitled to, or elects not to, assume the defense of a claim will not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment of any indemnified party, a conflict of interest may exist between such indemnified party and any other of such indemnified parties with respect to such claim, in which event the indemnifying party shall be obligated to pay the reasonable fees and disbursements of such additional counsel or counsels.

(f)Each party hereto agrees that, if for any reason the indemnification provisions contemplated by Section 2.8(a) or Section 2.8(b) are unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities or expenses (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, liabilities or expenses (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party in connection with the actions which resulted in the losses, claims, damages, liabilities or expenses as well as any other relevant equitable considerations.  The relative fault of such indemnifying party and indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such indemnifying party or indemnified party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.  The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 2.8(d) were determined by pro rata allocation (even if the Holders or any underwriters or all of them were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in this Section 2.8(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses (or actions in respect thereof) referred to above shall be deemed to include any legal or other fees or expenses reasonably incurred by such indemnified party in connection with investigating or, except as provided in Section 2.8(c), defending any such action or claim.  Notwithstanding the provisions of this Section 2.8(d), no Holder shall be required to contribute an amount greater than the dollar amount by which the net proceeds received by such Holder with respect to the sale of any Registrable Shares exceeds the amount of damages which such Holder has otherwise been required to pay by reason of any and all untrue or alleged untrue statements of material fact or omissions or alleged omissions of material fact made in any registration statement, prospectus or preliminary prospectus or any amendment thereof or supplement thereto related to such sale of Registrable Shares.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent

Exhibit 10.4

(g)misrepresentation.  The Holders’ obligations in this Section 2.8(d) to contribute shall be several in proportion to the amount of Registrable Shares registered by them and not joint.

If indemnification is available under this Section 2.8, the indemnifying parties shall indemnify each indemnified party to the full extent provided in Section 2.8(a) and Section 2.8(b) without regard to the relative fault of said indemnifying party or indemnified party or any other equitable consideration provided for in this Section 2.8(d) subject, in the case of the Holders, to the limited dollar amounts set forth in Section 2.8(b).

(h)The indemnification and contribution provided for under this Agreement will remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director or controlling Person of such indemnified party and will survive the transfer of securities.

2.10Current Public Information.  With a view to making available to the Holders the benefits of certain rules and regulations of the SEC that may at any time permit the sale of securities to the public without registration, the Company agrees to use its best efforts to:

(a)make and keep public information available, as those terms are defined in Rule 144 under the Securities Act, at all times after the effective date that the Company becomes subject to the reporting requirements of the Securities Act or the Exchange Act;

(b)file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements); and

(c)furnish to any Holder, so long as such Holder owns any Registrable Shares, upon request by such Holder, (i) a written statement by the Company that it has complied with the reporting requirements of Rule 144 (at any time after 90 days after the effective date of the first registration statement filed by the Company for an offering of its securities to the general public), and of the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements), (ii) a copy of the most recent annual or quarterly report of the Company and (iii) such other reports and documents of the Company and other information in the possession of or reasonably obtainable by the Company as a Holder may reasonably request in availing itself of any rule or regulation of the SEC allowing a Holder to sell any such securities without registration.

2.11No Inconsistent Agreements.  Neither the Company nor any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its Subsidiaries, on of after the date of this Agreement, enter into any agreement with

Exhibit 10.4

2.12respect to its securities, that would have the effect of impairing the rights granted to the Holders under this Agreement or otherwise conflicts with provisions thereof.  Except as set forth on Schedule 2.10, neither the Company nor any of its Subsidiaries has previously entered into any agreement granting any registration rights with respect to any of its securities to any Person that have not been satisfied in full.  

ARTICLE III  - TERMINATION

3.1Termination.  The provisions of this Agreement shall terminate on the seventh anniversary hereof.

ARTICLE IV  -  MISCELLANEOUS

4.1Notices.  Any notices or other communications required or permitted hereunder shall be in writing, and shall be sufficiently given if made by hand delivery, by telex, by telecopier or registered or certified mail, postage prepaid, return receipt requested, addressed as follows (or at such other address as may be substituted by notice given as herein provided):

If to the Company:

Geokinetics Inc.

1500 City West Blvd., Suite 800

Houston, TX 77042

Telecopy #: (713) 850-7330

Attention:  Richard F. Miles

With copies to (which shall not constitute notice):

Chamberlain, Hrdlicka, White, Williams & Martin

1200 Smith Street, Suite 1400

Houston, Texas 77002

Telecopy #:  (713) 658-2553

Attention:  James J. Spring, III

If to any Holder, at its address listed on the signature pages hereof.

Any notice or communication hereunder shall be deemed to have been given or made as of the date so delivered if personally delivered; when answered back, if telexed; when receipt is acknowledged, if telecopied; and five calendar days after mailing if sent by registered or certified mail (except that a notice of change of address shall not be deemed to have been given until actually received by the addressee).

Exhibit 10.4

Failure to transmit a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.  If a notice or communication is given or made in the manner provided above, it is duly given, whether or not the addressee receives it.

4.2Governing Law.  THIS AGREEMENT, THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT, AND ANY CLAIM OR CONTROVERSY DIRECTLY OR INDIRECTLY BASED UPON OR ARISING OUT OF THIS AGREEMENT (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, SHALL IN ALL RESPECTS BE GOVERNED BY AND INTERPRETED, CONSTRUED AND DETERMINED EXCLUSIVELY IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THAT WOULD REQUIRE THE APPLICATION OF THE LAW OF ANY OTHER JURISDICTION.

4.3Jurisdiction.  EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO SUBMIT TO THE EXCLUSIVE JURISDICTION OF FEDERAL OR STATE COURT OF COMPETENT JURISDICTION IN THE SOUTHERN DISTRICT OF NEW YORK AND ANY APPELLATE COURT THEREFROM, FOR THE RESOLUTION OF ANY AND ALL DISPUTES, CONTROVERSIES, CONFLICTS, LITIGATION OR ACTIONS ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE SUBJECT MATTER HEREOF AND AGREES NOT TO COMMENCE ANY LITIGATION OR ACTIONS ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE SUBJECT MATTER HEREOF IN ANY OTHER COURT.

4.4Successors and Assigns.  Except as otherwise expressly provided herein, this Agreement shall be binding upon and benefit the Company, each Holder and their respective successors and assigns.

4.5Duplicate Originals.  All parties may sign any number of copies of this Agreement.  Each signed copy shall be an original, but all of them together shall represent the same agreement.

4.6Severability.  In case any provision in this Agreement shall be held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and the remaining provisions shall not in any way be affected or impaired thereby.

4.7No Waivers; Amendments.

(a)No failure or delay on the part of the Company or any Holder in exercising any right, power or remedy hereunder shall operate as a

Exhibit 10.4

(b)waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy.  The remedies provided for herein are cumulative and are not exclusive of any remedies that may be available to the Company or any Holder at law or in equity or otherwise.

(c)Any provision of this Agreement may be amended or waived if, but only if, such amendment or waiver is in writing and is signed by the Company and the Required Holders.

4.8Negotiated Agreement. This Agreement was negotiated by the parties with the benefit of legal representation, and any rule of construction or interpretation otherwise requiring this Agreement to be construed or interpreted against any party shall not apply to the construction or interpretation hereof.

4.9Prior Registration Rights.  In consideration of the inclusion of shares of Common Stock owned by the Avista Holders within the definition of Registrable Securities herein, the Avista Holders hereby waive their right to have any of their shares of Common stock included within the definition of Registrable Securities under the Registration Rights Agreement dated as of May 2, 2003 (the “2003 Registration Rights Agreement”), among the Company and the parties named therein and acknowledge that they shall not be entitled to any rights under the 2003 Registration Rights Agreement.

 [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

Exhibit 10.4

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the date first written above.

GEOKINETICS INC.

By:  /s/ Richard F. Miles

                Name:  Richard F. Miles

Title:    President

DA1:\453472\09\9PWG09!.DOC\18866.0004                                                              

Exhibit 10.4

AVISTA CAPITAL PARTNERS, L.P.

By: AVISTA CAPITAL PARTNERS GP, LLC, its general partner

By:           /s/ Jeff Gunst                                                      

Jeff Gunst,

Authorized Signatory

Address:

1000 Louisiana Street, Suite 1200

Houston, Texas 77002

Telecopy: (713) 328-1097

Attention: Steve Webster

AVISTA CAPITAL PARTNERS (OFFSHORE), L.P.

By: AVISTA CAPITAL PARTNERS GP, LLC, its general partner

By:           /s/ Jeff Gunst                                                      

Jeff Gunst,

Authorized Signatory

Address:

1000 Louisiana Street, Suite 1200

Houston, Texas 77002

Telecopy: (713) 328-1097

Attention: Steve Webster

Copy to:

King & Spalding LLP

1100 Louisiana, Suite 4000

Houston, TX  77002

Telephone: (713) 751-3240

Facsimile:  (713) 751-3290

Attention:  Steve Rubin, Esq.,

Exhibit 10.4

LEVANT AMERICA S.A.

By:           /s/ K.H. Hannan, Jr.                                                      

K. H. Hannan, Jr.

Attorney in Fact

Colonial Navigation Company, Inc.

750 Lexington Ave. 26th Floor

New York, New York, 10022

Telecopy: (212) 319-2826

Attention: K. H. Hannan, Jr.

0686343.04

940480-000000:7/23/2008

Exhibit 10.4

AMENDED AND RESTATED

REGISTRATION RIGHTS AGREEMENT

GEOKINETICS INC.

Dated as of July 28, 2008

Exhibit 10.4

TABLE OF CONTENTS	Page
ARTICLE I -  DEFINITIONS	2
1.1  Definitions	2
1.2  Other Definitional and Interpretive Matters	4
ARTICLE II -  REGISTRATION RIGHTS	4
2.1  Demand Registration	5
2.2  Piggyback Registrations	9
2.3  Transfer of Registration Rights	10
2.4  Holdback Agreement	10
2.5  Registration Procedures	11
2.6  Suspension of Dispositions	14
2.7  Registration Expenses	15
2.8  Indemnification	16
2.9  Current Public Information	19
2.10  No Inconsistent Agreements	19
ARTICLE III -  TERMINATION	20
3.1  Termination	20
ARTICLE IV -  MISCELLANEOUS	20
4.1  Notices	20
4.2  Governing Law	21
4.3  Jurisdiction	21
4.4  Successors and Assigns	21
4.5  Duplicate Originals	21
4.6  Severability	21
4.7  No Waivers; Amendments	21
4.8  Negotiated Agreement	22
4.9  Prior Registration Rights	22
End of TOC - Do not delete this paragraph!

EX-10.5

THE SECURITIES REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, (II) SUCH SECURITIES ARE SOLD PURSUANT TO RULE 144 UNDER THE SECURITIES ACT OF 1993, AS AMENDED, OR ANY RULE PROMULGATED UNDER SUCH ACT WHICH IS A SUCCESSOR TO RULE 144, OR (III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933 OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT SECURED BY THE SECURITIES.

SUBJECT TO THE PROVISIONS OF SECTION 10 HEREOF, THIS WARRANT SHALL BE VOID AFTER 5:00 P.M. EASTERN TIME ON JULY 28, 2013 [FIFTH ANNIVERSARY OF THE CLOSING DATE] (THE “EXPIRATION DATE”).

No. 001

GEOKINETICS INC. WARRANT TO PURCHASE 189,920 SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE

For VALUE RECEIVED, Avista Capital Partners, L.P. (“Warrantholder”), is entitled to purchase, subject to the provisions of this Warrant, from Geokinetics Inc., a Delaware corporation (“Company”), at any time from and after the Initial Exercise Date (as defined below) and not later than 5:00 P.M., Eastern time, on the Expiration Date (as defined above), at an exercise price per share equal to $20.00 (the exercise price in effect being herein called the “Warrant Price”), 189,920 shares (“Warrant Shares”) of the Company’s Common Stock, par value $0.01 per share (“Common Stock”).  The number of Warrant Shares purchasable upon exercise of this Warrant and the Warrant Price shall be subject to adjustment from time to time as described herein.

This Warrant is one of a series of Warrants of like tenor issued by the Company pursuant to that certain Series B-2 and Warrant Purchase Agreement dated July 28, 2008, among the Company and the Investors named therein (the “Purchase Agreement”), and initially covering an aggregate of up to 240,000 shares of Common Stock (collectively, the “2008 Warrants”).

As used herein, “Initial Exercise Date” shall mean July 29, 2008.

Section 1.                                Registration.  The Company shall maintain books for the transfer and registration of the Warrant.  Upon the initial issuance of this Warrant, the Company shall issue and register the Warrant in the name of the Warrantholder.

Exhibit 10.5

Section 2.                                Transfers.  As provided herein, this Warrant may be transferred only pursuant to a registration statement filed under the Securities Act of 1933, as amended (the “Securities Act”), or an exemption from such registration.  Subject to such restrictions, the Company shall transfer this Warrant from time to time upon the books to be maintained by the Company for that purpose, upon surrender hereof for transfer, properly endorsed or accompanied by appropriate instructions for transfer and such other documents as may be reasonably required by the Company, including, if required by the Company, an opinion of its counsel to the effect that such transfer is exempt from the registration requirements of the Securities Act, to establish that such transfer is being made in accordance with the terms hereof, and a new Warrant shall be issued to the transferee and the surrendered Warrant shall be canceled by the Company.

Section 3.                                Exercise of Warrant.  Subject to the provisions hereof, the Warrantholder may exercise this Warrant, in whole or in part, at any time after the Initial Exercise Date and prior to its expiration upon surrender of the Warrant, together with delivery of a duly executed Warrant exercise form, in the form attached hereto as Appendix A (the “Exercise Agreement”) and payment by cash, certified check or wire transfer of funds (or, in certain circumstances, by cashless exercise as provided below) of the aggregate Warrant Price for that number of Warrant Shares then being purchased, to the Company during normal business hours on any business day at the Company’s principal executive offices (or such other office or agency of the Company as it may designate by notice to the Warrantholder).  The Warrant Shares so purchased shall be deemed to be issued to the Warrantholder or the Warrantholder’s designee, as the record owner of such shares, as of the close of business on the date on which this Warrant shall have been surrendered (or the date evidence of loss, theft or destruction thereof and security or indemnity satisfactory to the Company has been provided to the Company), the Warrant Price shall have been paid and the completed Exercise Agreement shall have been delivered.  Certificates for the Warrant Shares so purchased shall be delivered to the Warrantholder within a reasonable time, not exceeding three (3) business days, after this Warrant shall have been so exercised.  The certificates so delivered shall be in such denominations as may be requested by the Warrantholder and shall be registered in the name of the Warrantholder or such other name as shall be designated by the Warrantholder, as specified in the Exercise Agreement.  If this Warrant shall have been exercised only in part, then, unless this Warrant has expired, the Company shall, at its expense, at the time of delivery of such certificates, deliver to the Warrantholder a new Warrant representing the right to purchase the number of shares with respect to which this Warrant shall not then have been exercised.  As used herein, “business day” means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of business.  Each exercise hereof shall constitute the re-affirmation by the Warrantholder that the representations and warranties contained in Section 5 of the Purchase Agreement are true and correct in all material respects with respect to the Warrantholder as of the time of such exercise.  Notwithstanding the foregoing, to effect the exercise of the Warrant hereunder, the Warrantholder shall not be required to physically surrender this Warrant to the Company unless the entire Warrant is exercised.  The Warrantholder and the Company shall maintain records showing the amount exercised and the dates of such exercise.  The Warrantholder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provision of the paragraph, following exercise of a portion of the Warrant, the number of Warrant Shares of this Warrant may be less than the amount stated on the face hereof.

Section 4.                                Compliance with the Securities Act of 1933. Except as provided in the Purchase Agreement, the Company may cause the legend set forth on the first page of this

Exhibit 10.5

Warrant to be set forth on each Warrant, and a similar legend on any security issued or issuable upon exercise of this Warrant, unless counsel for the Company is of the opinion as to any such security that such legend is unnecessary.

Section 5.                                Payment of Taxes.  The Company will pay any documentary stamp taxes attributable to the initial issuance of Warrant Shares issuable upon the exercise of the Warrant; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issuance or delivery of any certificates for Warrant Shares in a name other than that of the Warrantholder in respect of which such shares are issued, and in such case, the Company shall not be required to issue or deliver any certificate for Warrant Shares or any Warrant until the person requesting the same has paid to the Company the amount of such tax or has established to the Company’s reasonable satisfaction that such tax has been paid.  The Warrantholder shall be responsible for income taxes due under federal, state or other law, if any such tax is due.

Section 6.                                Mutilated or Missing Warrants.  In case this Warrant shall be mutilated, lost, stolen, or destroyed, the Company shall issue in exchange and substitution of and upon surrender and cancellation of the mutilated Warrant, or in lieu of and substitution for the Warrant lost, stolen or destroyed, a new Warrant of like tenor and for the purchase of a like number of Warrant Shares, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction of the Warrant, and with respect to a lost, stolen or destroyed Warrant, reasonable indemnity or bond with respect thereto, if requested by the Company.

Section 7.                                Reservation of Common Stock.  At any time when this Warrant is exercisable, the Company shall at all applicable times keep reserved until issued (if necessary) as contemplated by this Section 7, out of the authorized and unissued shares of Common Stock, sufficient shares to provide for the exercise of the rights of purchase represented by this Warrant.  The Company agrees that all Warrant Shares issued upon due exercise of the Warrant shall be, at the time of delivery of the certificates for such Warrant Shares, duly authorized, validly issued, fully paid and non-assessable shares of Common Stock of the Company.

Section 8.                               Adjustments.  Subject and pursuant to the provisions of this Section 8, the Warrant Price and number of Warrant Shares subject to this Warrant shall be subject to adjustment from time to time as set forth hereinafter.

A.  Warrant Price Adjustment.

1. If the Company shall issue, on or after the Initial Exercise Date, any Additional Stock (as defined below) for a consideration per share less than the Warrant Price in effect immediately prior to the issuance of such Additional Stock, and if the aggregate dollar amount of all previous issuances of Additional Stock since the Initial Exercise Date is less than $50,000,000 (determined by aggregating all previous issuances of Additional Stock made after the Initial Exercise Date) the Warrant Price for the Series B Preferred Stock in effect immediately prior to each such issuance shall forthwith be adjusted to a price equal to the per share consideration paid or given for such Additional Stock; provided, however, if the Company shall issue, on or after the Initial Exercise Date, any Additional Stock after the aggregate amount of previous issuances made after the Initial Exercise Date are in excess of $50,000,000 (determined

Exhibit 10.5

by aggregating all previous issuances of Additional Stock made after the Initial Exercise Date) for a consideration per share less than the Warrant Price in effect immediately prior to the issuance of such Additional Stock, the Warrant Price in effect immediately prior to each such issuance shall forthwith be adjusted to a price determined by multiplying such Warrant Price by a fraction, the numerator of which shall be the number of shares of Common Stock Outstanding (as defined below) immediately prior to such issuance plus the number of shares of Common Stock that the aggregate consideration received by the Company for such issuance would purchase at such Warrant Price; and the denominator of which shall be the number of shares of Common Stock Outstanding (as defined below) immediately prior to such issuance plus the number of shares of such Additional Stock.  For purposes of this Section 8(A), the term “Common Stock Outstanding” shall mean and include the following: (1) outstanding Common Stock, (2) Common Stock issuable upon exercise of outstanding stock options, (3) Common Stock issuable upon exercise of outstanding warrants to purchase Common Stock, (4) Common Stock issuable upon conversion of the Series B Preferred Stock, and (5) Common Stock issuable upon the conversion of any other series or class of equity securities issued after the date hereof which is convertible into shares of Common Stock.  Shares described in (1) through (3) above shall be included whether vested or unvested, whether contingent or non-contingent and whether exercisable or not yet exercisable.

2. No adjustment of the Warrant Price shall be made in an amount less than one cent per share, provided that any adjustments that are not required to be made by reason of this sentence shall be carried forward and shall be either taken into account in any subsequent adjustment made prior to three (3) years from the date of the event giving rise to the adjustment being carried forward, or shall be made at the end of three (3) years from the date of the event giving rise to the adjustment being carried forward. Except to the limited extent provided for in subsections 8(A)(5)(c) and (5)(d), no adjustment of such Warrant Price pursuant to this subsection 8(A)(2) shall have the effect of increasing the Warrant Price above the Warrant Price in effect immediately prior to such adjustment.

3. In the case of the issuance of Additional Stock for cash, the consideration shall be deemed to be the amount of cash paid therefore before deducting any reasonable discounts, commission or other expenses allowed, paid or incurred by the Company for any underwriting or otherwise in connection with the issuance and sale thereof.

4. In the case of the issuance of the Additional Stock for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the fair market value thereof as determined by the Board of Directors irrespective of any accounting treatment.  In the event that the Warrantholder disagrees with the determination of the fair market value of any consideration and the Board of Directors of the Company and the Warrantholder are unable to agree upon such fair market value, the Company and the Warrantholder shall jointly select an appraiser, who is experienced in such matters.  The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne equally by the Company and the Warrantholder.

Exhibit 10.5

 5.           In the case of the issuance of options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock or options to purchase or rights to subscribe for such convertible or exchangeable securities, the following provisions shall apply for purposes of determining the number of shares of Additional Stock issued and the consideration paid therefor:

a.           The aggregate maximum number of shares of Common Stock deliverable upon exercise (assuming the satisfaction of any conditions to exercisability, including without limitation, the passage of time, but without taking into account potential antidilution adjustments) of such options to purchase or rights to subscribe for Common Stock shall be deemed to have been issued at the time such options or rights were issued and for a consideration equal to the consideration (determined in the manner provided in subsections 8 (A)(3) and 8(A)(4)), if any, received by the Company upon the issuance of such options or rights plus the minimum exercise price provided in such options or rights (without taking into account potential antidilution adjustments) for the Common Stock covered thereby.

b.           The aggregate maximum number of shares of Common Stock deliverable upon conversion or, or in exchange (assuming the satisfaction of any conditions to convertibility or exchangeability, including, without limitation, the passage of time, but without taking into account potential antidilution adjustments) for, any such convertible or exchangeable securities or upon the exercise of options to purchase or rights to subscribe for such convertible or exchangeable securities and subsequent conversion or exchange thereof shall be deemed to have been issued at the time such securities were issued or such options or rights were issued and for a consideration equal to the consideration, if any, received by the Company for any such securities and related options or rights (excluding any cash received on account of accrued interest or accrued dividends), plus the minimum additional consideration, if any, to be received by the Company (without taking into account potential antidilution adjustments) upon the conversion or exchange of such securities or the exercise of any related options or rights (the consideration in each case to be determined in the manner provided in subsections 8 (A)(3) and 8(A)(4).

c.           In the event of any change in the number of shares of Common Stock deliverable or in the consideration payable to the Company upon exercise of such options or rights or upon conversion of or in exchange for such convertible or exchangeable shares, the Warrant Price, to the extent in any way affected by or computed using such options, rights or securities, shall be recomputed to reflect such change, but no further adjustment shall be made for the actual issuance of Common Stock or any payment of such consideration upon the exercise of any such options or rights or the conversion or exchange of such securities.

d.           The number of shares of Additional Stock deemed issued and the consideration deemed paid therefor pursuant to subsections 8 (A)(5)(a)

Exhibit 10.5

and (b) shall be appropriately adjusted to reflect any change, termination or expiration of the type described in either subsection 8(A)(5)(a) or (b).

B.           Additional Stock shall mean any shares of Common Stock issued (or deemed to have been issued pursuant to subsection 8(A)(5)) by the Company on or after the Initial Exercise Date other than:

1. Shares of Common Stock issued to employees, directors, officers, consultants and other service providers for the primary purpose of soliciting or retaining their services pursuant to plans or agreements approved by the Company's Board of Directors;

2. Common Stock issued pursuant to the conversion or exercise of convertible or exercisable securities outstanding on the Initial Exercise Date;

3. Common Stock issued pursuant to the conversion of the Series B Preferred Stock.

a. In the event the Company should at any time or from time to time after the Initial Exercise Date fix a record date for the effectuation of a split or subdivision of the outstanding shares of Common Stock or the determination of holders of Common Stock entitled to receive a dividend or other distribution payable in additional shares of Common Stock or other securities or rights convertible into, or entitling the holder thereof to receive directly or indirectly, additional shares of Common Stock (hereinafter referred to as “Common Stock Equivalents”) without payment of any consideration by such holder for the additional shares of Common Stock or the Common Stock Equivalents (including the additional shares of Common Stock issuable upon conversion or exercise thereof), then, as of such record date (or the date of such dividend distribution, split or subdivision if no record date is fixed), the Warrant Price shall be appropriately decreased so that the number of shares of Common Stock issuable on conversion of each share of such series shall be increased in proportion to such increase of the aggregate of shares of Common Stock outstanding and those issuable with respect to such Common Stock Equivalents.

b. If the number of shares of Common Stock outstanding at any time after the Initial Exercise Date is decreased by a combination of the outstanding shares of Common Stock, then, following the record date of such combination, the Warrant Price shall be appropriately increased so that the number of shares of Common Stock issuable on conversion of each share of such series shall be decreased in proportion to such decrease in outstanding shares.

C.           Warrant Share Adjustment.  If any capital reorganization, reclassification of the capital stock of the Company, consolidation or merger of the Company with another corporation in which the Company is not the survivor, or sale, transfer or other disposition of all

Exhibit 10.5

or substantially all of the Company’s assets to another corporation shall be effected, then, as a condition of such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby each Warrantholder shall thereafter have the right to purchase and receive upon the basis and upon the terms and conditions herein specified and in lieu of the Warrant Shares immediately theretofore issuable upon exercise of the Warrant, such shares of stock, securities or assets as would have been issuable or payable with respect to or in exchange for a number of Warrant Shares equal to the number of Warrant Shares immediately theretofore issuable upon exercise of the Warrant, had such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition not taken place, and in any such case appropriate provision shall be made with respect to the rights and interests of each Warrantholder to the end that the provisions hereof (including, without limitation, provision for adjustment of the Warrant Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof.  The Company shall not effect any such consolidation, merger, sale, transfer or other disposition unless prior to or simultaneously with the consummation thereof the successor corporation (if other than the Company) resulting from such consolidation or merger, or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity shall assume the obligation to deliver to the Warrantholder, at the last address of the Warrantholder appearing on the books of the Company, such shares of stock, securities or assets as, in accordance with the foregoing provisions, the Warrantholder may be entitled to purchase, and the other obligations under this Warrant.  The provisions of this Section 8(C) shall similarly apply to successive reorganizations, reclassifications, consolidations, mergers, sales, transfers or other dispositions.

Section 9.                                 Fractional Interest.  The Company shall not be required to issue fractions of Warrant Shares upon the exercise of this Warrant.  If any fractional share of Common Stock would, except for the provisions of the first sentence of this Section 9, be deliverable upon such exercise, the Company, in lieu of delivering such fractional share, shall pay to the exercising Warrantholder an amount in cash equal to the Market Price of such fractional share of Common Stock on the date of exercise.  “Market Price” as of a particular date (the “Valuation Date”) shall mean the following: (a) if the Common Stock is then listed on a national stock exchange, the closing sale price of one share of Common Stock on such exchange on the last trading day prior to the Valuation Date; (b) if the Common Stock is then quoted on The Nasdaq Stock Market, Inc. (“Nasdaq”), the National Association of Securities Dealers, Inc. OTC Bulletin Board (the “Bulletin Board”) or such similar quotation system or association, the closing sale price of one share of Common Stock on Nasdaq, the Bulletin Board or such other quotation system or association on the last trading day prior to the Valuation Date or, if no such closing sale price is available, the average of the high bid and the low asked price quoted thereon on the last trading day prior to the Valuation Date; or (c) if the Common Stock is not then listed on a national stock exchange or quoted on Nasdaq, the Bulletin Board or such other quotation system or association, the fair market value of one share of Common Stock as of the Valuation Date, as determined in good faith by the Board of Directors of the Company and the Warrantholder.  In the event that the Board of Directors of the Company and the Warrantholder are unable to agree upon the fair market value, the Company and the Warrantholder shall jointly select an appraiser, who is experienced in such matters.  The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne equally by the Company and the Warrantholder.

Exhibit 10.5

Section 10.                                Extension of Expiration Date.  If the Company defers the filing of any Registration Statement covering Registrable Securities (unless otherwise defined herein, capitalized terms are as defined in the Amended and Restated Registration Rights Agreement relating to the Warrant Shares (the “2008 Registration Rights Agreement”)) pursuant to Section 2.1(h) of the 2008 Registration Rights Agreement occurs, and the deferral (whether alone, or in combination with any other deferral) continues for more than 90 days in any twelve-month period, or for more than a total of 90 days, then the Expiration Date of this Warrant shall be extended one day for each day beyond the 90-day limits, as the case may be, that the deferral continues.

Section 11.                                Benefits.  Nothing in this Warrant shall be construed to give any person, firm or corporation (other than the Company and the Warrantholder) any legal or equitable right, remedy or claim, it being agreed that this Warrant shall be for the sole and exclusive benefit of the Company and the Warrantholder.

Section 12.                                Notices to Warrantholder.  Upon the happening of any event requiring an adjustment of the Warrant Price, the Company shall promptly give written notice thereof to the Warrantholder at the address appearing in the records of the Company, stating the adjusted Warrant Price and the adjusted number of Warrant Shares resulting from such event and setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based.  Failure to give such notice to the Warrantholder or any defect therein shall not affect the legality or validity of the subject adjustment.

Section 13.                                Identity of Transfer Agent.  The Transfer Agent for the Common Stock is Mellon Investor Services LLC.  Upon the appointment of any subsequent transfer agent for the Common Stock or other shares of the Company’s capital stock issuable upon the exercise of the rights of purchase represented by the Warrant, the Company will mail to the Warrantholder a statement setting forth the name and address of such transfer agent.

Section 14.                                Notices.  Unless otherwise provided, any notice required or permitted under this Warrant shall be given in writing and shall be deemed effectively given and received as hereinafter described (i) if given by personal delivery, then such notice shall be deemed received upon such delivery, (ii) if given by telex or facsimile, then such notice shall be deemed received upon receipt of confirmation of complete transmittal, (iii) if given by certified mail return receipt requested, then such notice shall be deemed received upon the day such return receipt is signed, and (iv) if given by an internationally recognized overnight air courier, then such notice shall be deemed given one business day after delivery to such carrier.  Copies of such notices shall also be transmitted by email to the email address provided for on the signature page of the Purchase Agreement.  All notices shall be addressed as follows: if to the Warrantholder, at its address as set forth in the Company’s books and records and, if to the Company, at the address as follows, or at such other address as the Warrantholder or the Company may designate by ten days’ advance written notice to the other:

If to the Company:

Geokinetics Inc.

1500 City West Blvd.

Suite 800

Exhibit 10.5

Houston, Texas 77042

Attention:  Richard F. Miles

Fax:  (281) 848-6824

With a copy to:

Chamberlain, Hrdlicka, White, Williams & Martin

1200 Smith Street

Suite 1400

Houston, Texas 77002

Attention:  James J. Spring, III

Fax:  (713) 658-2553

Section 15.                                Registration Rights.  The initial Warrantholder is entitled to the benefit of certain registration rights with respect to the shares of Common Stock issuable upon the exercise of this Warrant as provided in the Registration Rights Agreement, and any subsequent Warrantholder may be entitled to such rights.

Section 16.                                 Successors.  All the covenants and provisions hereof by or for the benefit of the Warrantholder shall bind and inure to the benefit of its respective successors and assigns hereunder.

Section 17.                                Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.  This Warrant shall be governed by, and construed in accordance with, the internal laws of the State of New York, without reference to the choice of law provisions thereof.  The Company and, by accepting this Warrant, the Warrantholder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby.  Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Warrant.  The Company and, by accepting this Warrant, the Warrantholder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court.  The Company and, by accepting this Warrant, the Warrantholder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE WARRANTHOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

Section 18.                                Cashless Exercise.  Notwithstanding any other provision contained herein to the contrary, from and after the first anniversary of the Closing Date (as defined in the Purchase Agreement) and so long as the Company is required under the Registration Rights Agreement to have effected the registration of the Warrant Shares for resale to the public pursuant to a Registration Statement (as such term is defined in the Registration Rights

Exhibit 10.5

Agreement), if the Company breaches its obligations under the 2008 Registration Rights Agreement, the Warrantholder may elect to receive, without the payment by the Warrantholder of the aggregate Warrant Price in respect of the shares of Common Stock to be acquired, shares of Common Stock of equal value to the value of this Warrant, or any specified portion hereof, by the surrender of this Warrant (or such portion of this Warrant being so exercised) together with a Net Issue Election Notice, in the form annexed hereto as Appendix B, duly executed, to the Company.  The Company shall use reasonable commercial efforts to permit the exercise of this Warrant by the Warrantholder on a tax-free basis pursuant to this Section 18.  Thereupon, the Company shall issue to the Warrantholder such number of fully paid, validly issued and nonassessable shares of Common Stock as is computed using the following formula:

X = Y (A - B)

       A

where

X =           the number of shares of Common Stock to which the Warrantholder is entitled upon such cashless exercise;

Y =           the total number of shares of Common Stock covered by this Warrant for which the Warrantholder has surrendered purchase rights at such time for cashless exercise (including both shares to be issued to the Warrantholder and shares as to which the purchase rights are to be canceled as payment therefor);

A =           the Market Price of one share of Common Stock as of the date the net issue election is made; and

B =           the Warrant Price in effect under this Warrant at the time the net issue election is made.

Section 19.                                No Rights as Stockholder.  Prior to the exercise of this Warrant, the Warrantholder shall not have or exercise any rights as a stockholder of the Company by virtue of its ownership of this Warrant.

Section 20.                                Amendment; Waiver.  Any term of this Warrant may be amended or waived (including the adjustment provisions included in Section 8 of this Warrant) upon the written consent of the Company and the holders of a majority of the 2008 Warrants representing at least 50% of the number of shares of Common Stock then subject to all outstanding 2008 Warrants (the “Majority Holders”); provided, that (x) any such amendment or waiver must apply to all Company Warrants; and (y) the number of Warrant Shares subject to this Warrant, the Warrant Price and the Expiration Date may not be amended, and the right to exercise this Warrant may not be altered or waived, without the written consent of the Warrantholder.

Section 21.                                Section Headings.  The section headings in this Warrant are for the convenience of the Company and the Warrantholder and in no way alter, modify, amend, limit or restrict the provisions hereof.

Exhibit 10.5

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed, as of the 28th day of July, 2008.

GEOKINETICS INC.

By:  /s/ Richard F. Miles

Name:  Richard F. Miles

Title:    President

Exhibit 10.5

APPENDIX A

GEOKINETICS INC.

WARRANT EXERCISE FORM

To Geokinetics Inc.:

The undersigned hereby irrevocably elects to exercise the right of purchase represented by the within Warrant (“Warrant”) for, and to purchase thereunder by the payment of the Warrant Price and surrender of the Warrant, _______________ shares of Common Stock (“Warrant Shares”) provided for therein, and requests that certificates for the Warrant Shares be issued as follows:

_______________________________

Name

________________________________

Address

________________________________

________________________________

Federal Tax ID or Social Security No.

and delivered by (certified mail to the above address, or (electronically (provide DWAC Instructions:___________________), or (other (specify):  _______________________).

and, if the number of Warrant Shares shall not be all the Warrant Shares purchasable upon exercise of the Warrant, that a new Warrant for the balance of the Warrant Shares purchasable upon exercise of this Warrant be registered in the name of the undersigned Warrantholder or the undersigned’s Assignee as below indicated and delivered to the address stated below.

Dated: ___________________, ____

Note:  The signature must correspond with                                                                                                Signature:______________________________

the name of the Warrantholder as written

on the first page of the Warrant in every                                                                                                                       ______________________________

particular, without alteration or enlargement                                                                                                                                   Name (please print)

or any change whatever, unless the Warrant

has been assigned.                                                                                     

______________________________

Address

______________________________

Federal Identification or

Social Security No.

Assignee:

_______________________________

_______________________________

_______________________________

Exhibit 10.5

APPENDIX B

GEOKINETICS INC.

NET ISSUE ELECTION NOTICE

To:  Geokinetics Inc.:

Date:[_________________________]

The undersigned hereby elects under Section 18 of this Warrant to surrender the right to purchase [____________] shares of Common Stock pursuant to this Warrant and hereby requests the issuance of [_____________] shares of Common Stock.  The certificate(s) for the shares issuable upon such net issue election shall be issued in the name of the undersigned or as otherwise indicated below.

_________________________________________

Signature

_________________________________________

Name for Registration

_________________________________________

Mailing Address

0691275.1

940480-000000:7/25/2008

EX-10.6

THE SECURITIES REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS (I) SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, (II) SUCH SECURITIES ARE SOLD PURSUANT TO RULE 144 UNDER THE SECURITIES ACT OF 1993, AS AMENDED, OR ANY RULE PROMULGATED UNDER SUCH ACT WHICH IS A SUCCESSOR TO RULE 144, OR (III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933 OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT SECURED BY THE SECURITIES.

SUBJECT TO THE PROVISIONS OF SECTION 10 HEREOF, THIS WARRANT SHALL BE VOID AFTER 5:00 P.M. EASTERN TIME ON JULY 28, 2013 [FIFTH ANNIVERSARY OF THE CLOSING DATE] (THE “EXPIRATION DATE”).

No. 002

GEOKINETICS INC. WARRANT TO PURCHASE 50,080 SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE

For VALUE RECEIVED, Avista Capital Partners (Offshore), L.P. (“Warrantholder”), is entitled to purchase, subject to the provisions of this Warrant, from Geokinetics Inc., a Delaware corporation (“Company”), at any time from and after the Initial Exercise Date (as defined below) and not later than 5:00 P.M., Eastern time, on the Expiration Date (as defined above), at an exercise price per share equal to $20.00 (the exercise price in effect being herein called the “Warrant Price”), 50,080 shares (“Warrant Shares”) of the Company’s Common Stock, par value $0.01 per share (“Common Stock”).  The number of Warrant Shares purchasable upon exercise of this Warrant and the Warrant Price shall be subject to adjustment from time to time as described herein.

This Warrant is one of a series of Warrants of like tenor issued by the Company pursuant to that certain Series B-2 and Warrant Purchase Agreement dated July 28, 2008, among the Company and the Investors named therein (the “Purchase Agreement”), and initially covering an aggregate of up to 240,000 shares of Common Stock (collectively, the “2008 Warrants”).

As used herein, “Initial Exercise Date” shall mean July 29, 2008.

Section 1.                                Registration.  The Company shall maintain books for the transfer and registration of the Warrant.  Upon the initial issuance of this Warrant, the Company shall issue and register the Warrant in the name of the Warrantholder.

Exhibit 10.6

Section 2.                                Transfers.  As provided herein, this Warrant may be transferred only pursuant to a registration statement filed under the Securities Act of 1933, as amended (the “Securities Act”), or an exemption from such registration.  Subject to such restrictions, the Company shall transfer this Warrant from time to time upon the books to be maintained by the Company for that purpose, upon surrender hereof for transfer, properly endorsed or accompanied by appropriate instructions for transfer and such other documents as may be reasonably required by the Company, including, if required by the Company, an opinion of its counsel to the effect that such transfer is exempt from the registration requirements of the Securities Act, to establish that such transfer is being made in accordance with the terms hereof, and a new Warrant shall be issued to the transferee and the surrendered Warrant shall be canceled by the Company.

Section 3.                                Exercise of Warrant.  Subject to the provisions hereof, the Warrantholder may exercise this Warrant, in whole or in part, at any time after the Initial Exercise Date and prior to its expiration upon surrender of the Warrant, together with delivery of a duly executed Warrant exercise form, in the form attached hereto as Appendix A (the “Exercise Agreement”) and payment by cash, certified check or wire transfer of funds (or, in certain circumstances, by cashless exercise as provided below) of the aggregate Warrant Price for that number of Warrant Shares then being purchased, to the Company during normal business hours on any business day at the Company’s principal executive offices (or such other office or agency of the Company as it may designate by notice to the Warrantholder).  The Warrant Shares so purchased shall be deemed to be issued to the Warrantholder or the Warrantholder’s designee, as the record owner of such shares, as of the close of business on the date on which this Warrant shall have been surrendered (or the date evidence of loss, theft or destruction thereof and security or indemnity satisfactory to the Company has been provided to the Company), the Warrant Price shall have been paid and the completed Exercise Agreement shall have been delivered.  Certificates for the Warrant Shares so purchased shall be delivered to the Warrantholder within a reasonable time, not exceeding three (3) business days, after this Warrant shall have been so exercised.  The certificates so delivered shall be in such denominations as may be requested by the Warrantholder and shall be registered in the name of the Warrantholder or such other name as shall be designated by the Warrantholder, as specified in the Exercise Agreement.  If this Warrant shall have been exercised only in part, then, unless this Warrant has expired, the Company shall, at its expense, at the time of delivery of such certificates, deliver to the Warrantholder a new Warrant representing the right to purchase the number of shares with respect to which this Warrant shall not then have been exercised.  As used herein, “business day” means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of business.  Each exercise hereof shall constitute the re-affirmation by the Warrantholder that the representations and warranties contained in Section 5 of the Purchase Agreement are true and correct in all material respects with respect to the Warrantholder as of the time of such exercise.  Notwithstanding the foregoing, to effect the exercise of the Warrant hereunder, the Warrantholder shall not be required to physically surrender this Warrant to the Company unless the entire Warrant is exercised.  The Warrantholder and the Company shall maintain records showing the amount exercised and the dates of such exercise.  The Warrantholder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provision of the paragraph, following exercise of a portion of the Warrant, the number of Warrant Shares of this Warrant may be less than the amount stated on the face hereof.

Section 4.                                Compliance with the Securities Act of 1933. Except as provided in the Purchase Agreement, the Company may cause the legend set forth on the first page of this

Exhibit 10.6

Warrant to be set forth on each Warrant, and a similar legend on any security issued or issuable upon exercise of this Warrant, unless counsel for the Company is of the opinion as to any such security that such legend is unnecessary.

Section 5.                                Payment of Taxes.  The Company will pay any documentary stamp taxes attributable to the initial issuance of Warrant Shares issuable upon the exercise of the Warrant; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issuance or delivery of any certificates for Warrant Shares in a name other than that of the Warrantholder in respect of which such shares are issued, and in such case, the Company shall not be required to issue or deliver any certificate for Warrant Shares or any Warrant until the person requesting the same has paid to the Company the amount of such tax or has established to the Company’s reasonable satisfaction that such tax has been paid.  The Warrantholder shall be responsible for income taxes due under federal, state or other law, if any such tax is due.

Section 6.                                Mutilated or Missing Warrants.  In case this Warrant shall be mutilated, lost, stolen, or destroyed, the Company shall issue in exchange and substitution of and upon surrender and cancellation of the mutilated Warrant, or in lieu of and substitution for the Warrant lost, stolen or destroyed, a new Warrant of like tenor and for the purchase of a like number of Warrant Shares, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction of the Warrant, and with respect to a lost, stolen or destroyed Warrant, reasonable indemnity or bond with respect thereto, if requested by the Company.

Section 7.                                Reservation of Common Stock.  At any time when this Warrant is exercisable, the Company shall at all applicable times keep reserved until issued (if necessary) as contemplated by this Section 7, out of the authorized and unissued shares of Common Stock, sufficient shares to provide for the exercise of the rights of purchase represented by this Warrant.  The Company agrees that all Warrant Shares issued upon due exercise of the Warrant shall be, at the time of delivery of the certificates for such Warrant Shares, duly authorized, validly issued, fully paid and non-assessable shares of Common Stock of the Company.

Section 8.                               Adjustments.  Subject and pursuant to the provisions of this Section 8, the Warrant Price and number of Warrant Shares subject to this Warrant shall be subject to adjustment from time to time as set forth hereinafter.

A.  Warrant Price Adjustment.

1. If the Company shall issue, on or after the Initial Exercise Date, any Additional Stock (as defined below) for a consideration per share less than the Warrant Price in effect immediately prior to the issuance of such Additional Stock, and if the aggregate dollar amount of all previous issuances of Additional Stock since the Initial Exercise Date is less than $50,000,000 (determined by aggregating all previous issuances of Additional Stock made after the Initial Exercise Date) the Warrant Price for the Series B Preferred Stock in effect immediately prior to each such issuance shall forthwith be adjusted to a price equal to the per share consideration paid or given for such Additional Stock; provided, however, if the Company shall issue, on or after the Initial Exercise Date, any Additional Stock after the aggregate amount of previous issuances made after the Initial Exercise Date are in excess of $50,000,000 (determined

Exhibit 10.6

by aggregating all previous issuances of Additional Stock made after the Initial Exercise Date) for a consideration per share less than the Warrant Price in effect immediately prior to the issuance of such Additional Stock, the Warrant Price in effect immediately prior to each such issuance shall forthwith be adjusted to a price determined by multiplying such Warrant Price by a fraction, the numerator of which shall be the number of shares of Common Stock Outstanding (as defined below) immediately prior to such issuance plus the number of shares of Common Stock that the aggregate consideration received by the Company for such issuance would purchase at such Warrant Price; and the denominator of which shall be the number of shares of Common Stock Outstanding (as defined below) immediately prior to such issuance plus the number of shares of such Additional Stock.  For purposes of this Section 8(A), the term “Common Stock Outstanding” shall mean and include the following: (1) outstanding Common Stock, (2) Common Stock issuable upon exercise of outstanding stock options, (3) Common Stock issuable upon exercise of outstanding warrants to purchase Common Stock, (4) Common Stock issuable upon conversion of the Series B Preferred Stock, and (5) Common Stock issuable upon the conversion of any other series or class of equity securities issued after the date hereof which is convertible into shares of Common Stock.  Shares described in (1) through (3) above shall be included whether vested or unvested, whether contingent or non-contingent and whether exercisable or not yet exercisable.

2. No adjustment of the Warrant Price shall be made in an amount less than one cent per share, provided that any adjustments that are not required to be made by reason of this sentence shall be carried forward and shall be either taken into account in any subsequent adjustment made prior to three (3) years from the date of the event giving rise to the adjustment being carried forward, or shall be made at the end of three (3) years from the date of the event giving rise to the adjustment being carried forward. Except to the limited extent provided for in subsections 8(A)(5)(c) and (5)(d), no adjustment of such Warrant Price pursuant to this subsection 8(A)(2) shall have the effect of increasing the Warrant Price above the Warrant Price in effect immediately prior to such adjustment.

3. In the case of the issuance of Additional Stock for cash, the consideration shall be deemed to be the amount of cash paid therefore before deducting any reasonable discounts, commission or other expenses allowed, paid or incurred by the Company for any underwriting or otherwise in connection with the issuance and sale thereof.

4. In the case of the issuance of the Additional Stock for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the fair market value thereof as determined by the Board of Directors irrespective of any accounting treatment.  In the event that the Warrantholder disagrees with the determination of the fair market value of any consideration and the Board of Directors of the Company and the Warrantholder are unable to agree upon such fair market value, the Company and the Warrantholder shall jointly select an appraiser, who is experienced in such matters.  The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne equally by the Company and the Warrantholder.

Exhibit 10.6

  5.           In the case of the issuance of options to purchase or rights to subscribe for Common Stock, securities by their terms convertible into or exchangeable for Common Stock or options to purchase or rights to subscribe for such convertible or exchangeable securities, the following provisions shall apply for purposes of determining the number of shares of Additional Stock issued and the consideration paid therefor:

a.           The aggregate maximum number of shares of Common Stock deliverable upon exercise (assuming the satisfaction of any conditions to exercisability, including without limitation, the passage of time, but without taking into account potential antidilution adjustments) of such options to purchase or rights to subscribe for Common Stock shall be deemed to have been issued at the time such options or rights were issued and for a consideration equal to the consideration (determined in the manner provided in subsections 8 (A)(3) and 8(A)(4)), if any, received by the Company upon the issuance of such options or rights plus the minimum exercise price provided in such options or rights (without taking into account potential antidilution adjustments) for the Common Stock covered thereby.

b.           The aggregate maximum number of shares of Common Stock deliverable upon conversion or, or in exchange (assuming the satisfaction of any conditions to convertibility or exchangeability, including, without limitation, the passage of time, but without taking into account potential antidilution adjustments) for, any such convertible or exchangeable securities or upon the exercise of options to purchase or rights to subscribe for such convertible or exchangeable securities and subsequent conversion or exchange thereof shall be deemed to have been issued at the time such securities were issued or such options or rights were issued and for a consideration equal to the consideration, if any, received by the Company for any such securities and related options or rights (excluding any cash received on account of accrued interest or accrued dividends), plus the minimum additional consideration, if any, to be received by the Company (without taking into account potential antidilution adjustments) upon the conversion or exchange of such securities or the exercise of any related options or rights (the consideration in each case to be determined in the manner provided in subsections 8 (A)(3) and 8(A)(4).

c.           In the event of any change in the number of shares of Common Stock deliverable or in the consideration payable to the Company upon exercise of such options or rights or upon conversion of or in exchange for such convertible or exchangeable shares, the Warrant Price, to the extent in any way affected by or computed using such options, rights or securities, shall be recomputed to reflect such change, but no further adjustment shall be made for the actual issuance of Common Stock or any payment of such consideration upon the exercise of any such options or rights or the conversion or exchange of such securities.

d.           The number of shares of Additional Stock deemed issued and the consideration deemed paid therefor pursuant to subsections 8 (A)(5)(a)

Exhibit 10.6

and (b) shall be appropriately adjusted to reflect any change, termination or expiration of the type described in either subsection 8(A)(5)(a) or (b).

B.           Additional Stock shall mean any shares of Common Stock issued (or deemed to have been issued pursuant to subsection 8(A)(5)) by the Company on or after the Initial Exercise Date other than:

1. Shares of Common Stock issued to employees, directors, officers, consultants and other service providers for the primary purpose of soliciting or retaining their services pursuant to plans or agreements approved by the Company's Board of Directors;

2. Common Stock issued pursuant to the conversion or exercise of convertible or exercisable securities outstanding on the Initial Exercise Date;

3. Common Stock issued pursuant to the conversion of the Series B Preferred Stock.

a. In the event the Company should at any time or from time to time after the Initial Exercise Date fix a record date for the effectuation of a split or subdivision of the outstanding shares of Common Stock or the determination of holders of Common Stock entitled to receive a dividend or other distribution payable in additional shares of Common Stock or other securities or rights convertible into, or entitling the holder thereof to receive directly or indirectly, additional shares of Common Stock (hereinafter referred to as “Common Stock Equivalents”) without payment of any consideration by such holder for the additional shares of Common Stock or the Common Stock Equivalents (including the additional shares of Common Stock issuable upon conversion or exercise thereof), then, as of such record date (or the date of such dividend distribution, split or subdivision if no record date is fixed), the Warrant Price shall be appropriately decreased so that the number of shares of Common Stock issuable on conversion of each share of such series shall be increased in proportion to such increase of the aggregate of shares of Common Stock outstanding and those issuable with respect to such Common Stock Equivalents.

b. If the number of shares of Common Stock outstanding at any time after the Initial Exercise Date is decreased by a combination of the outstanding shares of Common Stock, then, following the record date of such combination, the Warrant Price shall be appropriately increased so that the number of shares of Common Stock issuable on conversion of each share of such series shall be decreased in proportion to such decrease in outstanding shares.

C.           Warrant Share Adjustment.  If any capital reorganization, reclassification of the capital stock of the Company, consolidation or merger of the Company with another corporation in which the Company is not the survivor, or sale, transfer or other disposition of all

Exhibit 10.6

or substantially all of the Company’s assets to another corporation shall be effected, then, as a condition of such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition, lawful and adequate provision shall be made whereby each Warrantholder shall thereafter have the right to purchase and receive upon the basis and upon the terms and conditions herein specified and in lieu of the Warrant Shares immediately theretofore issuable upon exercise of the Warrant, such shares of stock, securities or assets as would have been issuable or payable with respect to or in exchange for a number of Warrant Shares equal to the number of Warrant Shares immediately theretofore issuable upon exercise of the Warrant, had such reorganization, reclassification, consolidation, merger, sale, transfer or other disposition not taken place, and in any such case appropriate provision shall be made with respect to the rights and interests of each Warrantholder to the end that the provisions hereof (including, without limitation, provision for adjustment of the Warrant Price) shall thereafter be applicable, as nearly equivalent as may be practicable in relation to any shares of stock, securities or assets thereafter deliverable upon the exercise hereof.  The Company shall not effect any such consolidation, merger, sale, transfer or other disposition unless prior to or simultaneously with the consummation thereof the successor corporation (if other than the Company) resulting from such consolidation or merger, or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity shall assume the obligation to deliver to the Warrantholder, at the last address of the Warrantholder appearing on the books of the Company, such shares of stock, securities or assets as, in accordance with the foregoing provisions, the Warrantholder may be entitled to purchase, and the other obligations under this Warrant.  The provisions of this Section 8(C) shall similarly apply to successive reorganizations, reclassifications, consolidations, mergers, sales, transfers or other dispositions.

Section 9.                                Fractional Interest.  The Company shall not be required to issue fractions of Warrant Shares upon the exercise of this Warrant.  If any fractional share of Common Stock would, except for the provisions of the first sentence of this Section 9, be deliverable upon such exercise, the Company, in lieu of delivering such fractional share, shall pay to the exercising Warrantholder an amount in cash equal to the Market Price of such fractional share of Common Stock on the date of exercise.  “Market Price” as of a particular date (the “Valuation Date”) shall mean the following: (a) if the Common Stock is then listed on a national stock exchange, the closing sale price of one share of Common Stock on such exchange on the last trading day prior to the Valuation Date; (b) if the Common Stock is then quoted on The Nasdaq Stock Market, Inc. (“Nasdaq”), the National Association of Securities Dealers, Inc. OTC Bulletin Board (the “Bulletin Board”) or such similar quotation system or association, the closing sale price of one share of Common Stock on Nasdaq, the Bulletin Board or such other quotation system or association on the last trading day prior to the Valuation Date or, if no such closing sale price is available, the average of the high bid and the low asked price quoted thereon on the last trading day prior to the Valuation Date; or (c) if the Common Stock is not then listed on a national stock exchange or quoted on Nasdaq, the Bulletin Board or such other quotation system or association, the fair market value of one share of Common Stock as of the Valuation Date, as determined in good faith by the Board of Directors of the Company and the Warrantholder.  In the event that the Board of Directors of the Company and the Warrantholder are unable to agree upon the fair market value, the Company and the Warrantholder shall jointly select an appraiser, who is experienced in such matters.  The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne equally by the Company and the Warrantholder.

Exhibit 10.6

Section 10.                                Extension of Expiration Date.  If the Company defers the filing of any Registration Statement covering Registrable Securities (unless otherwise defined herein, capitalized terms are as defined in the Amended and Restated Registration Rights Agreement relating to the Warrant Shares (the “2008 Registration Rights Agreement”)) pursuant to Section 2.1(h) of the 2008 Registration Rights Agreement occurs, and the deferral (whether alone, or in combination with any other deferral) continues for more than 90 days in any twelve-month period, or for more than a total of 90 days, then the Expiration Date of this Warrant shall be extended one day for each day beyond the 90-day limits, as the case may be, that the deferral continues.

Section 11.                                Benefits.  Nothing in this Warrant shall be construed to give any person, firm or corporation (other than the Company and the Warrantholder) any legal or equitable right, remedy or claim, it being agreed that this Warrant shall be for the sole and exclusive benefit of the Company and the Warrantholder.

Section 12.                                Notices to Warrantholder.  Upon the happening of any event requiring an adjustment of the Warrant Price, the Company shall promptly give written notice thereof to the Warrantholder at the address appearing in the records of the Company, stating the adjusted Warrant Price and the adjusted number of Warrant Shares resulting from such event and setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based.  Failure to give such notice to the Warrantholder or any defect therein shall not affect the legality or validity of the subject adjustment.

Section 13.                                Identity of Transfer Agent.  The Transfer Agent for the Common Stock is Mellon Investor Services LLC.  Upon the appointment of any subsequent transfer agent for the Common Stock or other shares of the Company’s capital stock issuable upon the exercise of the rights of purchase represented by the Warrant, the Company will mail to the Warrantholder a statement setting forth the name and address of such transfer agent.

Section 14.                                Notices.  Unless otherwise provided, any notice required or permitted under this Warrant shall be given in writing and shall be deemed effectively given and received as hereinafter described (i) if given by personal delivery, then such notice shall be deemed received upon such delivery, (ii) if given by telex or facsimile, then such notice shall be deemed received upon receipt of confirmation of complete transmittal, (iii) if given by certified mail return receipt requested, then such notice shall be deemed received upon the day such return receipt is signed, and (iv) if given by an internationally recognized overnight air courier, then such notice shall be deemed given one business day after delivery to such carrier.  Copies of such notices shall also be transmitted by email to the email address provided for on the signature page of the Purchase Agreement.  All notices shall be addressed as follows: if to the Warrantholder, at its address as set forth in the Company’s books and records and, if to the Company, at the address as follows, or at such other address as the Warrantholder or the Company may designate by ten days’ advance written notice to the other:

If to the Company:

Geokinetics Inc.

1500 City West Blvd.

Suite 800

Exhibit 10.6

Houston, Texas 77042

Attention:  Richard F. Miles

Fax:  (281) 848-6824

With a copy to:

Chamberlain, Hrdlicka, White, Williams & Martin

1200 Smith Street

Suite 1400

Houston, Texas 77002

Attention:  James J. Spring, III

Fax:  (713) 658-2553

Section 15.                                Registration Rights.  The initial Warrantholder is entitled to the benefit of certain registration rights with respect to the shares of Common Stock issuable upon the exercise of this Warrant as provided in the Registration Rights Agreement, and any subsequent Warrantholder may be entitled to such rights.

Section 16.                                 Successors.  All the covenants and provisions hereof by or for the benefit of the Warrantholder shall bind and inure to the benefit of its respective successors and assigns hereunder.

Section 17.                                Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.  This Warrant shall be governed by, and construed in accordance with, the internal laws of the State of New York, without reference to the choice of law provisions thereof.  The Company and, by accepting this Warrant, the Warrantholder, each irrevocably submits to the exclusive jurisdiction of the courts of the State of New York located in New York County and the United States District Court for the Southern District of New York for the purpose of any suit, action, proceeding or judgment relating to or arising out of this Warrant and the transactions contemplated hereby.  Service of process in connection with any such suit, action or proceeding may be served on each party hereto anywhere in the world by the same methods as are specified for the giving of notices under this Warrant.  The Company and, by accepting this Warrant, the Warrantholder, each irrevocably consents to the jurisdiction of any such court in any such suit, action or proceeding and to the laying of venue in such court.  The Company and, by accepting this Warrant, the Warrantholder, each irrevocably waives any objection to the laying of venue of any such suit, action or proceeding brought in such courts and irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum. EACH OF THE COMPANY AND, BY ITS ACCEPTANCE HEREOF, THE WARRANTHOLDER HEREBY WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS WARRANT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

Section 18.                                Cashless Exercise.  Notwithstanding any other provision contained herein to the contrary, from and after the first anniversary of the Closing Date (as defined in the Purchase Agreement) and so long as the Company is required under the Registration Rights Agreement to have effected the registration of the Warrant Shares for resale to the public pursuant to a Registration Statement (as such term is defined in the Registration Rights

Exhibit 10.6

Agreement), if the Company breaches its obligations under the 2008 Registration Rights Agreement, the Warrantholder may elect to receive, without the payment by the Warrantholder of the aggregate Warrant Price in respect of the shares of Common Stock to be acquired, shares of Common Stock of equal value to the value of this Warrant, or any specified portion hereof, by the surrender of this Warrant (or such portion of this Warrant being so exercised) together with a Net Issue Election Notice, in the form annexed hereto as Appendix B, duly executed, to the Company.  The Company shall use reasonable commercial efforts to permit the exercise of this Warrant by the Warrantholder on a tax-free basis pursuant to this Section 18.  Thereupon, the Company shall issue to the Warrantholder such number of fully paid, validly issued and nonassessable shares of Common Stock as is computed using the following formula:

X = Y (A - B)

       A

where

X =           the number of shares of Common Stock to which the Warrantholder is entitled upon such cashless exercise;

Y =           the total number of shares of Common Stock covered by this Warrant for which the Warrantholder has surrendered purchase rights at such time for cashless exercise (including both shares to be issued to the Warrantholder and shares as to which the purchase rights are to be canceled as payment therefor);

A =           the Market Price of one share of Common Stock as of the date the net issue election is made; and

B =           the Warrant Price in effect under this Warrant at the time the net issue election is made.

Section 19.                                No Rights as Stockholder.  Prior to the exercise of this Warrant, the Warrantholder shall not have or exercise any rights as a stockholder of the Company by virtue of its ownership of this Warrant.

Section 20.                                Amendment; Waiver.  Any term of this Warrant may be amended or waived (including the adjustment provisions included in Section 8 of this Warrant) upon the written consent of the Company and the holders of a majority of the 2008 Warrants representing at least 50% of the number of shares of Common Stock then subject to all outstanding 2008 Warrants (the “Majority Holders”); provided, that (x) any such amendment or waiver must apply to all Company Warrants; and (y) the number of Warrant Shares subject to this Warrant, the Warrant Price and the Expiration Date may not be amended, and the right to exercise this Warrant may not be altered or waived, without the written consent of the Warrantholder.

Section 21.                                Section Headings.  The section headings in this Warrant are for the convenience of the Company and the Warrantholder and in no way alter, modify, amend, limit or restrict the provisions hereof.

Exhibit 10.6

IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed, as of the 28th day of July, 2008.

GEOKINETICS INC.

By:  /s/ Richard F. Miles

Name:  Richard F. Miles

Title:    President

Exhibit 10.6

APPENDIX A

GEOKINETICS INC.

WARRANT EXERCISE FORM

To Geokinetics Inc.:

The undersigned hereby irrevocably elects to exercise the right of purchase represented by the within Warrant (“Warrant”) for, and to purchase thereunder by the payment of the Warrant Price and surrender of the Warrant, _______________ shares of Common Stock (“Warrant Shares”) provided for therein, and requests that certificates for the Warrant Shares be issued as follows:

_______________________________

Name

________________________________

Address

________________________________

________________________________

Federal Tax ID or Social Security No.

and delivered by (certified mail to the above address, or (electronically (provide DWAC Instructions:___________________), or (other (specify):  _______________________).

and, if the number of Warrant Shares shall not be all the Warrant Shares purchasable upon exercise of the Warrant, that a new Warrant for the balance of the Warrant Shares purchasable upon exercise of this Warrant be registered in the name of the undersigned Warrantholder or the undersigned’s Assignee as below indicated and delivered to the address stated below.

Dated: ___________________, ____

Note:  The signature must correspond with                                                                                                Signature:______________________________

the name of the Warrantholder as written

on the first page of the Warrant in every                                                                                                                       ______________________________

particular, without alteration or enlargement                                                                                                                                   Name (please print)

or any change whatever, unless the Warrant

has been assigned.

______________________________

______________________________

Address

______________________________

Federal Identification or

Social Security No.

Assignee:

_______________________________

_______________________________

_______________________________

Exhibit 10.6

APPENDIX B

GEOKINETICS INC.

NET ISSUE ELECTION NOTICE

To:  Geokinetics Inc.:

Date:[_________________________]

The undersigned hereby elects under Section 18 of this Warrant to surrender the right to purchase [____________] shares of Common Stock pursuant to this Warrant and hereby requests the issuance of [_____________] shares of Common Stock.  The certificate(s) for the shares issuable upon such net issue election shall be issued in the name of the undersigned or as otherwise indicated below.

_________________________________________

Signature

_________________________________________

Name for Registration

_________________________________________

Mailing Address

0691278.1

940480-000000:7/25/2008

EX-99.1

NEWS

RELEASE

Contact:                Scott McCurdy

Vice President and CFO

Geokinetics Inc.

(713) 850-7600

(713) 850-7330 FAX

FOR IMMEDIATE RELEASE

GEOKINETICS INC. RAISES $30 MILLION FROM SALE

OF ADDITIONAL PREFERRED STOCK

HOUSTON, TXJuly 29, 2008 - Geokinetics Inc. (AMEX: GOK) (the “Company”) today announced that it has raised $30.0 million from the sale of additional shares of its existing Series B Senior Convertible Preferred Stock to fund growth initiatives and provide working capital for the business.

The Company closed the sale of 120,000 shares of its 8% Series B Senior Convertible Preferred Stock, $10.00 par value (“Series B Preferred Stock”), and warrants to purchase 240,000 shares of Geokinetics common stock for an aggregate consideration of $30.0 million to Avista Capital Partners, L.P. and Avista Capital Partners (Offshore), L.P.  Inclusive of this transaction, 377,526 shares of Series B Preferred Stock are outstanding. Treating the Series B Preferred Stock on an as-converted basis, the Series B purchasers hold approximately 38% of the Company’s voting stock immediately upon closing.  The warrants have a five-year life and are exercisable at $20 per share.

The proceeds from the sale of Series B Preferred Stock and warrants will be used to fund the Company’s capital expenditure budget, recently increased from $64.7 million to $80.0 million, for working capital required to support the Company’s growth initiatives and for general corporate purposes.

Richard F. Miles, President and Chief Executive Officer said, “As part of our strategic plan for focused growth, Geokinetics has made, and expects to continue making, significant investments in capital equipment in response to strong customer demand for our seismic data acquisition and data processing services. The completion of this financing gives us the financial strength and flexibility we need at an attractive cost of capital. The proceeds will enable us to fully fund our increased capital expenditure budget for growing our revenue-generating capacity in attractive markets.  Avista has been, and continues to be, a very supportive stockholder and we are pleased to expand the relationship further through this transaction.”

GEOKINETICS INC. (AMEX: GOK)

1500 CityWest Blvd, Suite 800, Houston, Texas  77042  (713) 850-7600  (713) 850-7330 FAX

About Geokinetics Inc.

Geokinetics Inc., based in Houston, Texas, is a leading global provider of seismic acquisition and high-end seismic data processing services to the oil and gas industry.  Geokinetics has strong operating presence in North America and is focused on key markets internationally. Geokinetics operates in some of the most challenging locations in the world from the Arctic to mountainous jungles to the transition zone environments. More information about Geokinetics is available at www.geokinetics.com.

Forward-Looking Statements

This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).  All statements, other than statements of historical facts, included in this release that address activities, events or developments that Geokinetics expects, believes or anticipates will or may occur in the future are forward- looking statements.  These statements include but are not limited to statements about the business outlook for the year, backlog and bid activity, business strategy, related financial performance and statements with respect to future benefits.  These statements are based on certain assumptions made by Geokinetics based on management's experience and perception of historical trends, industry conditions, market position, future operations, profitability, liquidity, backlog, capital resources and other factors believed to be appropriate.  Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of Geokinetics, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include risks relating to financial performance and results, job delays or cancellations, impact from severe weather conditions and other important factors that could cause actual results to differ materially from those projected, or backlog not to be completed, as described in the Company's reports filed with the Securities and Exchange Commission. Backlog consists of written orders and estimates of Geokinetics’ services which it believes to be firm, however, in many instances, the contracts are cancelable by customers so Geokinetics may never realize some or all of its backlog, which may lead to lower than expected financial performance.

Although Geokinetics believes that the expectations reflected in such statements are reasonable, it can give no assurance that such expectations will be correct.  All of Geokinetics’ forward-looking statements, whether written or oral, are expressly qualified by these cautionary statements and any other cautionary statements that may accompany such forward-looking statements.  Any forward-looking statement speaks only as of the date on which such statement is made and Geokinetics undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise.

GEOKINETICS INC. (AMEX: GOK)

1500 CityWest Blvd, Suite 800, Houston, Texas  77042  (713) 850-7600  (713) 850-7330 FAX