EXHIBIT VIII
INVESTMENT MONITORING AGREEMENT
INVESTMENT MONITORING AGREEMENT (hereinafter referred to as this
"Agreement"), dated as of July 18, 1997, by and among GEOKINETICS INC., a
Delaware corporation (the "Company"), BLACKHAWK CAPITAL PARTNERS, a Texas
general partnership (the "Investment Monitor") and BLACKHAWK INVESTORS, L.L.C, a
Delaware limited liability company ("Blackhawk").
W I T N E S S E T H:
WHEREAS, pursuant to a Securities Purchase and Exchange Agreement of
even date herewith (the "Purchase Agreement") among the Company, Blackhawk and
certain Holders (as defined therein), Blackhawk will invest in the Company (the
"Investment") by purchasing 5,041,667 shares of Common Stock of the Company,
171,875 shares of Series A Preferred Stock of the Company and a Shadow Warrant
to purchase up to an aggregate of 6,512,095 shares of Common Stock, subject to
adjustment;
WHEREAS, the Investment Monitor is the managing member of Blackhawk;
WHEREAS, as an inducement to the consummation of the transactions
contemplated by the Purchase Agreement Merger and the making of the Investment,
the parties have agreed that the Investment Monitor will oversee the Investment
on behalf of Blackhawk, and the Investment Monitor is willing to undertake such
responsibility on the terms and conditions set forth herein; and
WHEREAS, capitalized terms used herein without definition shall have
the respective meanings ascribed to the in the Purchase Agreement.
NOW, THEREFORE, in consideration of the conditions and mutual
agreements hereinafter set forth, the parties hereto agree as follows:
1. The parties agree that the Investment Monitor will monitor the
Investment, on behalf of Blackhawk, during the term of this Agreement (the
"Term"), which shall commence on the Closing Date of the transactions
contemplated by the Purchase Agreement and terminate as provided in paragraph 6
below.
2. During the Term, the Company shall pay to the Investment Monitor an
annual fee, in the amount of $25,000, in payment for its services to be rendered
hereunder (the "Fee"), which Fee will be paid quarterly in arrears on the last
business day of March, June, September and December of each year, commencing
September 30, 1997.
3. Nothing herein shall require the Investment Monitor to devote full
time to its duties hereunder, the Investment Monitor hereby agrees to devote
such of its time and activity during normal
Page 177 of 241 Pages
business days and hours as it, in its sole discretion, shall deem necessary for
the accomplishment of its duties hereunder.
4. The Investment Monitor shall not be liable to Blackhawk or any of
its members on account of any compensation received or action taken pursuant to
this Agreement.
5. Blackhawk hereby agrees to hold the Investment Monitor harmless from
and indemnify the Investment Monitor against all actions, proceedings, claims
and demands (herein referred to as "Claims") which may be brought against,
suffered or incurred by the Investment Monitor by reason of its performance or
nonperformance of its duties under the terms of this Agreement (including all
reasonable legal, professional and other expenses incurred), except any such
Claim that arises from the willful misconduct, gross negligence or fraud of the
Investment Monitor in the performance or nonperformance of its obligations or
duties hereunder.
6. This Agreement shall terminate (except for the provisions of
paragraph 5), upon the earlier to occur of (i) the date that on which Blackhawk
and/or its affiliates ceases to own 10% of the equity securities of the Company
or (ii) December 31, 2002, provided, that, if the event described in
subparagraph (i) above shall not have occurred before December 31, 2002, this
Agreement shall be automatically extended beyond December 31, 2002 for
successive one year terms, unless either the Company or Blackhawk shall give
written notice to the Investment Monitor at least 30 days before such expiration
date or such extended expiration date or until the occurrence of the event
described in subparagraph (i) above.
7. No modification of this Agreement, or any part hereof, shall be
valid or effective unless in writing and signed by the party or parties sought
to be charged therewith.
8. This Agreement contains the entire understanding of the parties and
supersedes any prior agreements and understandings between the parties with
respect to its subject matter.
9. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York, without regard to choice of law or conflicts
of law principles.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
GEOKINETICS INC.
By:/s/ XXX X. XXXXX
______________________________________
Name: Xxx X. Xxxxx
Title: President
BLACKHAWK CAPITAL PARTNERS
By:/s/ XXXXXXX X. XXXXXXX
______________________________________
Xxxxxxx X. Xxxxxxx, Partner
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BLACKHAWK INVESTORS, L.L.C.
By: Blackhawk Capital Partners, its Managing Member
By:/s/ XXXXXXX X. XXXXXXX
________________________________________________
Xxxxxxx X. Xxxxxxx, Partner
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