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EXHIBIT 10.51
OPERATING LEASE OF MARINE SEISMIC EQUIPMENT
This lease (the "Lease") dated as of February 3, 1997, is between
EAGLE GEOPHYSICAL, INC., a Delaware corporation (the "Lessor") and HORIZON
EXPLORATION LIMITED, a United Kingdom corporation (the "Lessee").
WHEREAS, the Lessor is the owner of the marine seismic equipment more
fully described in the purchase orders attached hereto as Exhibit A (the
"Equipment"); and
WHEREAS, the Lessee is the charterer under a time charter with The
Shanghai Bureau of Marine Geological Survey, dated April 12, 1994 of the
Bahamas flag seismic data recording vessel DISCOVERER, Official No. 711122 (the
"DISCOVERER"); and
WHEREAS, the Lessee is the charterer under a time charter with
Tidewater Marine, Inc., dated February 9, 1996 of the U.S. flag seismic data
recording vessel XXXXXXX TIDE, Official No. 663944 (the "XXXXXXX TIDE"); and
WHEREAS, the Lessee is the charterer under a time charter with Morr
Vessel Management Ltd., dated February 4, 1981 of the UK flag seismic data
recording vessel PACIFIC HORIZON, Official No. 6413807 (the "PACIFIC HORIZON");
and
WHEREAS, the Lessee is the charterer under a time charter with
Simon-Horizon Limited, dated July 15, 1994 of the Bahamas flag seismic data
recording vessel SIMON LABRADOR, Official Xx. 000000 (xxx "XXXXX XXXXXXXX," and
collectively with the DISCOVERER, the XXXXXXX TIDE, and the PACIFIC HORIZON,
the "Vessels"); and
WHEREAS, the Lessee wishes to lease the Equipment from the Lessor in
order to improve the seismic data acquisition capabilities of the Vessels;
NOW THEREFORE, in consideration of the above recitals and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. LEASE. (a) Subject to the provisions hereof, the Lessor
hereby leases to the Lessee and the Lessee hereby leases from the Lessor the
Equipment for a fixed term of three (3) years beginning on the date hereof.
(b) The term of this Lease may be extended for successive periods
of one (1) year each upon written agreement of the parties hereto no later than
thirty (30) days prior to termination.
2. RENT. The Equipment shall be leased at a monthly rental,
payable in U.S. Dollars, equal to Lessor's monthly debt payments relating to
the purchase of the Equipment plus 15%, as notified to Lessee from time to time
by Lessor, for the initial term specified in Section 1(a) above ("Rent"). The
Rent for any extension terms shall be agreed to by the parties hereto.
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The Lessee agrees to pay the Lessor, or to its order, Rent beginning on
February 28, 1997 and thereafter on the last day of each successive month
during the term of this Lease.
3. DELIVERY AND DISCLAIMER OF WARRANTIES. (a) As of the date
hereof, Lessee confirms that the Equipment is in good and satisfactory
operating condition, and has accepted delivery of the Equipment in such
condition. The Lessor hereby warrants that as of the date hereof it has good
and marketable title to the Equipment free and clear of claims by any third
party (other than the security interest granted in favor of NationsBanc Leasing
of North Carolina in connection with the acquisition of the Equipment by
Lessor, referred to herein as the "Bank Lien") and that it has the right to
lease the Equipment. The Lessor further warrants that during the term of this
Lease, so long as the Lessee is not in default of any other provisions thereof,
the Lessee shall enjoy use of the Equipment free and clear of any person
claiming title to or an interest in the Equipment by reason of the acts or
omissions of the Lessor.
(b) THE LESSOR MAKES NO OTHER REPRESENTATIONS OR WARRANTIES, EXPRESS
OR IMPLIED AS TO THE EQUIPMENT INCLUDING AS TO ITS VALUE, CONDITION, DESIGN,
OPERATION, MERCHANTABILITY OR FITNESS FOR USE FOR ANY PARTICULAR PURPOSE, AS TO
THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE
ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, TRADEMARK OR COPYRIGHT OR ANY OTHER
REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED; PROVIDED, HOWEVER,
THAT DURING THE TERM OF THIS LEASE THE LESSOR HEREBY TRANSFERS AND ASSIGNS TO
THE LESSEE ALL MANUFACTURERS' WARRANTIES CONCERNING THE EQUIPMENT AND WILL
ASSIST THE LESSEE WITH ANY CLAIMS AGAINST THE MANUFACTURER OF THE EQUIPMENT FOR
DEFECTIVE OR NON-PERFORMING PRODUCT OR DESIGN.
4. USE AND OPERATION. So long as no Event of Default shall occur
and be continuing, the Lessee shall have the full use of the Equipment and may
employ the Equipment in any lawful trade or commerce; provided, however, that
the Lessee covenants and agrees that it will not permit the Equipment to be
incorporated or installed in or attached to the Vessels or any other vessel,
building or real property in such manner as to become part of or subject to any
liens, security interest or encumbrances on the Vessels, any other vessel or
any building or real property or so as to preclude the removal of the Equipment
from the Vessels or any other location without material injury to the Equipment
(it being the intention of the parties that the Equipment is, and shall remain,
personal property throughout the term of this Lease); and provided, further,
that the Equipment shall not be used or operated in any manner contrary to any
applicable law, treaty or convention, or any rule or regulation issued
thereunder. The Lessee, at its sole cost and expense, shall perform all
routine maintenance and repairs on the Equipment and all major repairs or
overhauls of the Equipment required to keep the Equipment in good operating
condition.
5. OWNERSHIP. This agreement is a lease, and no title, equity or
right in or to the Equipment shall pass to the Lessee except the rights herein
expressly granted, nor shall the Lessee have any lien or charge on the
Equipment.
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6. ALTERATIONS. With the prior written consent of the Lessor,
the Lessee shall have the right, at its sole expense, to make alterations,
modifications, additions or attachments to the Equipment so long as the value
or usefulness of the Equipment is not reduced thereby. Except as otherwise
agreed by the Lessor, all alterations, modifications, additions and attachments
of whatsoever kind or nature made to the Equipment shall immediately become the
property of the Lessor and shall be subject to all terms of this Lease.
7. LOSS AND DAMAGE. (a) The Lessee shall assume and bear the
risk of loss and damage to the Equipment and all component parts thereof from
any cause whatsoever whether or not covered by insurance. No loss or damage to
the Equipment or any component part thereof shall impair any obligations of the
Lessee under this Lease which shall continue in full force and effect as
hereinafter expressly provided. The Lessee shall repair or cause to be
repaired all damage to the Equipment.
(b) In the event that all or part of the Equipment shall, as a result
of any cause, other than an act or omission of the Lessor, become lost, stolen,
destroyed or rendered irreparably unusable or damaged, as determined by the
Lessee, then the Lessee shall, within ten (10) days after it shall have made
such determination, fully inform the Lessor of such loss or damage and shall
pay the Lessor the then casualty value of the equipment, together with all Rent
and any other sums past due or becoming due to and including the date of such
payment. Upon payment of said amounts this Lease shall terminate.
(c) If the Vessels or the Equipment is taken by requisition or
governmental action as a result of the Lessee's operation of the Vessels or by
virtue of any actions arising by, through or under the Lessee or its agents or
contractors, the Lessee shall be responsible for obtaining the release of the
Equipment, and Rent shall continue until the Lessor receives any insurance
proceeds for such requisition.
(d) NOTWITHSTANDING ANY PROVISIONS TO THE CONTRARY CONTAINED IN
THIS SECTION 7 OR ELSEWHERE IN THIS LEASE, IF THERE IS ANY PARTIAL OR TOTAL OR
CONSTRUCTIVE OR COMPROMISED TOTAL LOSS OF ANY OF THE VESSELS OR THE EQUIPMENT
DURING THE PERIOD OF THIS LEASE, THE LESSEE HEREBY AGREES TO INDEMNIFY AND HOLD
HARMLESS THE LESSOR FOR AND AGAINST ANY INSURANCE DEDUCTIBLES AND UNINSURED
LOSSES INCURRED BY THE LESSEE. ALL SUCH INSURANCE SHORTFALLS SHALL BE PAID BY
LESSEE TO LESSOR ON DEMAND.
(e) If, at the time of scheduled redelivery of the Equipment under
this Lease, the Equipment is damaged or otherwise in need of repair or other
work to restore it to pre-hire condition as set forth herein the Lessee shall
continue to pay Rent during such repairs and other work and the Equipment shall
not be considered redelivered until it has been restored to said pre-hire
condition.
8. INSURANCE. Commencing on the date hereof and continuing until
the Lessee has redelivered possession of the Equipment to the Lessor or as
otherwise herein provided, whether or not this Lease has terminated as to the
Equipment, the Lessee, at its expense, agrees to obtain and maintain all risk
public liability and property damage insurance for the Equipment
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in an amount and with insurers satisfactory to the Lessor; provided, however,
that property damage insurance on the Equipment shall always be in an amount
equal to the casualty value of the Equipment as determined by the Lessor; which
casualty value shall be U.S.$313,925.00 on the date hereof. The insurance
obtained pursuant to this Section 8 shall not be excess over other coverage but
shall be primary insurance up to and including the stated policy limits and
shall cover the interests of both the Lessor and the Lessee in the Equipment,
or as the case may be, shall protect both the Lessor and the Lessee in respect
to all risks arising out of the condition, delivery, installation, maintenance,
use or operation of the Equipment. All such insurance shall provide for ten
(10) days prior written notice to the Lessor of cancellation, restriction or
reduction of coverage. The Lessee hereby irrevocably appoints the Lessor as
the Lessee's attorney-in-fact to make claim for, receive payment of and execute
and indorse all documents, checks or drafts for loss or damage under any
insurance policy issued on the Equipment. In the event the Equipment shall
sustain a casualty which does not render the Equipment irreparable or unusable
for its intended use, the Lessee shall have the right to the insurance proceeds
upon presentation to the Lessor of a repair estimate or survey showing the
extent of damage and the cost of repair thereof. Upon receipt of such
insurance proceeds, the Lessee is obligated to apply the proceeds to repair of
the Equipment. In the event of a casualty which renders the Equipment
irreparable or unusable for its intended use, the Lessor shall have the right
to the insurance proceeds with respect to the Equipment.
9. TAXES. The Lessee shall be responsible for the payment and
discharge of all license or registration fees, assessments, sales and use
taxes, rental taxes, personal property taxes and other taxes (except taxes on
the Lessor's income or profits), now or hereafter imposed by any federal, state
or local government upon the Equipment or upon the leasing, renting, possession
or use thereof (whether the same be assessed on the Lessor or the Lessee). The
Lessor shall pay any and all such taxes billed or assessed to it, however, if
any such tax is by law to be assessed or billed to the Lessor, the Lessee
agrees to reimburse the Lessor therefor. The Lessee shall directly pay any
such taxes billed or assessed to it. The Lessee shall pay to the Lessor the
amount of any taxes remitted by the Lessor within ten (10) days of notice
thereof. The Lessee upon notice to the Lessor may in the Lessee's own name,
contest or protest any such taxes. The Lessee shall, in addition, be
responsible to the Lessor for the payment and discharge of any penalties or
interest.
10. LIENS AND ENCUMBRANCES. (a) The Lessee will at all times
protect and defend, at its own cost and expense, the title of the Lessor to the
Equipment and keep the Equipment free and clear from all claims, liens and
other encumbrances, except (i) the rights of the Lessor hereunder, (ii) liens
for taxes either not yet due or being contested in good faith by appropriate
proceedings so long as such proceedings do not involve any danger of the sale,
forfeiture or loss of the Equipment, (iii) inchoate materialmen's, mechanics',
xxxxxxx'x, repairman's, employees' or other like liens arising in the ordinary
course of business and not delinquent, and (iv) the Bank Lien. Notwithstanding
the foregoing, nothing contained in this Lease shall require the Lessee to take
any action to protect and defend the Equipment from any liens, claims or other
encumbrances arising out of the acts or omissions of the Lessor or any
shareholder, affiliate, employee, agent or representatives of the Lessor.
(b) Neither the Lessee nor the masters of the Vessels nor any other
person shall have the right, power or authority to create, incur or permit to
exist upon the Equipment any lien,
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charge or encumbrance. As of the date hereof, the Lessee has placed, and all
at times during the term of this Lease shall keep prominently displayed on the
Equipment a legible notice on a metal plate not less than six inches wide by
nine inches high reading as follows:
"This seismic equipment is owned by EAGLE GEOPHYSICAL, INC., is not a
part of this vessel and cannot be encumbered by any liens arising
against this vessel."
11. INDEMNITY. THE LESSEE ASSUMES ALL RISK OF LIABILITY FOR ANY
DAMAGE OR LOSS TO THE EQUIPMENT, INCLUDING, BUT NOT LIMITED TO, ANY ARISING
FROM LIENS IMPOSED ON THE EQUIPMENT IN VIOLATION OF SECTION 10 ABOVE OR ARISING
FROM THE INCORPORATION OF THE EQUIPMENT INTO THE VESSELS, ANY OTHER VESSEL OR
ANY REAL PROPERTY IN VIOLATION OF SECTION 4 ABOVE, AND FOR INJURIES TO OR
DEATHS OF PERSONS AND/OR LOSS OF OR DAMAGE TO PROPERTY (INCLUDING, WITHOUT
LIMITATION, DAMAGE TO THE ENVIRONMENT AND PROPERTY, DUE TO POLLUTION OR THE
RELEASE OF HAZARDOUS WASTES OF ANY KIND) ARISING FROM OR INCIDENT TO THE
EQUIPMENT'S USE OR OPERATION, WHETHER SUCH INJURIES OR DEATHS INVOLVE THE
LESSEE'S EMPLOYEES OR OTHER PERSONS, AND WHETHER SUCH LOSS OR DAMAGE INVOLVES
PROPERTY OF THE LESSEE AND ITS EMPLOYEES AND CONTRACTORS OR OF OTHERS. THE
LESSEE WILL INDEMNIFY AND HOLD HARMLESS THE LESSOR (AND ANY FIRM OR CORPORATION
SUBSIDIARY TO, AFFILIATED WITH OR UNDER THE SAME MANAGEMENT AS THE LESSOR)
AGAINST AND FROM ALL LOSS, DAMAGE, LIABILITY AND EXPENSE, INCLUDING ATTORNEYS'
FEES, ARISING FROM OR IN CONNECTION WITH SUCH INJURY, DEATH, LOSS OR DAMAGE TO
PROPERTY OR THE ENVIRONMENT, HOWSOEVER CAUSED AND WHETHER RESULTING IN WHOLE OR
IN PART FROM THE NEGLIGENCE OR OTHER FAULT OF EITHER PARTY, BUT ONLY INSOFAR AS
SAID LOSS, DAMAGE, LIABILITY OR EXPENSE ARISES IN CONNECTION WITH THE LESSEE'S
ACCEPTANCE, USE, POSSESSION, OPERATION, OR RETURN OF THE EQUIPMENT UNDER THIS
LEASE.
12. LESSOR MAY PERFORM. Should the Lessee fail to make any
payment or do any act as provided by this Lease, then the Lessor shall have the
right (but not the obligation), without notice to the Lessee and without
releasing the Lessee from any obligations hereunder, to make or do the same or
to make advances to preserve the Equipment or the Lessor's title thereto and to
pay, purchase, contest or compromise any insurance premium, encumbrance,
charge, tax, lien or other sum which in the judgment of the Lessor appears to
affect the Equipment, and in exercising such rights, the Lessor may incur any
reasonable liability and expend reasonable amounts necessary therefor. All
sums so incurred or expended by the Lessor shall be due and payable by the
Lessee within ten (10) days of notice thereof.
13. ASSIGNMENT AND SUBLEASE. Any transfer, assignment, sublease,
conveyance or pledge of the Lessee's interest in and to this Lease or the
Equipment, whether by operation of law or otherwise, without the prior written
consent of the Lessor, shall be void. The Lessor, its successors or assigns,
may assign this Lease or grant a security interest therein or in the Equipment
in whole or in part. However, unless the Lessee receives written notice of
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such assignment, the Lessee shall have no obligation to pay Rent due pursuant
to this Lease to any party other than the Lessor.
14. SURRENDER OF THE EQUIPMENT. At the Lessor's request upon
expiration or earlier termination of this Lease or any renewal or extension
thereof, the Lessee shall return the Equipment to the Lessor in good condition
and working order, ordinary wear and tear resulting from use thereof excepted,
by delivery of the Equipment at the Lessee's cost and expense to a mutually
agreed upon place on the Gulf Coast of the United States.
15. EVENTS OF DEFAULT. The occurrence of any of the following
events, shall constitute an Event of Default under this Lease:
(a) the nonpayment by the Lessee of any Rent when due, or the
nonpayment by the Lessee of any other sum required hereunder
to be paid by the Lessee which nonpayment continues for a
period of five (5) days following written notice thereof from
the Lessor;
(b) the failure of the Lessee to perform any other term, covenant
or condition of this Lease which is not cured within ten (10)
days after written notice thereof from the Lessor;
(c) the Lessee ceases doing business as a going concern, is
insolvent, makes an assignment for the benefit of creditors,
admits in writing its inability to pay its debts as they
become due, files a voluntary petition in bankruptcy, is
subjected to an involuntary petition in bankruptcy which is
not released or dismissed within thirty (30) days after
filing, is adjudicated bankrupt or insolvent, files or has
filed against it a petition seeking any reorganization,
arrangement or composition, under any present or future
statute, law or regulation;
(d) any of the Lessee's representations or warranties made in this
Lease or in any statement or certificate at any time given in
writing pursuant to this Lease or in connection herewith shall
be false or misleading in any material respect; or
(e) the Lessee defaults under or otherwise has accelerated any
material obligation, credit agreement, loan agreement,
conditional sales contract, lease, indenture or debenture or
the Lessee defaults under any other agreement with the Lessor.
16. REMEDIES. (a) Should any Event of Default occur and be
continuing, the Lessor may, without notice to or demand upon the Lessee,
without retaking possession of the Equipment, accelerate and cause to become
immediately due and payable all Rent and other sums payable under the terms
hereof; or may retake (by the Lessor, independent contractors, or by requiring
the Lessee to assemble the Equipment for the Lessor at a location designated by
the Lessor) possession of the Equipment (without liability to the Lessee
therefor which is hereby expressly waived) and either:
(i) retain possession of the Equipment until the Lessor shall
terminate the Lessee's interest in the Equipment by giving the
Lessee written notice to that effect, in
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which event the Lessee shall be liable for all rents and other sums
accrued and unpaid prior to such termination;
(ii) lease the Equipment to a third party for the account of the
Lessee and recover from the Lessee any deficiency between the
rents provided for herein and those received from such third
party;
(iii) sell the Equipment at public or private sale, in which event
the Lessee shall pay to the Lessor upon demand the amount, if
any, by which the net proceeds of such sale shall be less than
the casualty value of the Equipment; or
(iv) recover from the Lessee the excess of the rents and charges
provided for in this Lease for the balance of the term over
the then reasonable rental value of the Equipment for the same
period.
(b) The Lessor may enforce any one or more of the remedies
hereunder successively or concurrently, and any such action shall not prevent
the Lessor from pursuing any further remedy the Lessor may have hereunder or at
law or in equity. Time and exactitude of each of the terms and conditions
hereof are hereby declared to be of the essence of this Lease. The Lessor may
accept past due payments without modifying the terms of this Lease and without
waiving any further rights. The Lessor shall not be obligated to sell or
release the Equipment. Nevertheless, in the event of a public sale the Lessor
may bid upon and purchase the Equipment.
17. INSPECTION BY LESSOR. The Lessor, its agents, representatives
or employees, shall at any and all reasonable times during regular working
hours have the right to board the Vessels for the purpose of inspecting the
Equipment and observing its use.
18. COSTS AND ATTORNEYS' FEES. In the event of any action at law
or a suit in equity by reason of the Lessee's breach of this Lease or any
governmental examination or investigation of the Lessee, which requires the
Lessor's participation and which participation would not be required but for
this Lease, or pursuant to the Lessor exercising any of its rights provided for
in this Lease or by applicable law, the Lessee, in addition to all other sums
which the Lessee may be called upon to pay under the provisions of this Lease,
will pay to the Lessor its reasonable costs of collection or other reasonable
out-of-pocket costs and expenses and attorneys' fees.
19. INTEREST AND SERVICE CHARGES. Any amounts required to be paid
by the Lessee pursuant to this Lease, and not paid when due (except payments of
taxes being properly contested) shall bear interest at the rate of 1.25% per
month until payment.
20. OFFSETS. The Rent and all other sums payable hereunder shall
be paid without notice, demand, counterclaim, setoff, deduction or defense and
without abatement, suspension, deferment, diminution or revocation, and the
obligations and liabilities of the Lessee under this Lease shall not be
affected for any reason. This Lease shall not be terminable by the Lessee in
whole or in part except as specifically provided in Sections 7 and 16 of this
Lease.
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21. HEADINGS. Section headings herein are used for convenience
only and shall not otherwise affect the provisions of this Lease.
22. EFFECT OF WAIVER. No failure or delay on the part of the
Lessor in the exercise of any remedy, power, right or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such remedy, power, right or privilege preclude other or further exercise
thereof or any other remedy, right, power or privilege. All rights and
remedies existing under this Lease are cumulative to, and not exclusive of, any
rights or remedies otherwise available.
23. SURVIVAL OF WARRANTIES. All agreements, representations and
warranties of the Lessee and the Lessor made herein shall survive the execution
of this Lease.
24. APPLICABLE LAW AND ARBITRATION. (a) This Lease and all
documents issued or executed pursuant hereto shall be governed by, and
construed under, the internal laws of the State of Texas. If any provision of
this Lease or any remedy provided herein shall be held to be invalid under any
applicable law, such provision shall be inapplicable and deemed omitted, but
the remaining provisions of this Lease shall be and remain effective in
accordance with their terms. This Lease may only be amended or modified by an
instrument in writing signed by a duly authorized representative of the party
to be charged thereby.
(b) Any controversy or claim arising out of or relating to this
Lease, or the alleged breach thereof, which cannot be resolved between the
Lessor and the Lessee shall be referred to arbitration before the Society of
Marine Arbitrators, Inc. before three (3) persons, one to be appointed by the
Lessor, one by the Lessee and the third by the two so chosen; their decision or
that of any two of them shall be final. The proceedings shall be conducted in
accordance with the Rules of such Society then in effect; provided, however,
that such arbitration proceedings shall take place in Houston, Texas. Any
award of the arbitration panel shall be final and binding on both parties and
may be enforced in the U.S. District Court for the Southern District of Texas,
or any other court having jurisdiction over the parties. The Lessor and the
Lessee agree that neither party shall have any right to commence or maintain
any suit or legal proceeding concerning any dispute hereunder, other than a
suit for enforcement of the arbitration provisions contained in this Section
24(b), until the dispute has been determined in accordance with the arbitration
procedure provided for herein and then only for enforcement of the award
rendered under such arbitration.
25. COUNTERPARTS. This Lease may be executed in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument.
26. NOTICES. (a) All notices, requests, consents, demands and
other communications provided for or permitted hereunder shall be effective
three (3) days after being duly deposited in the mails, certified, return
receipt requested, or upon receipt if delivered to Federal Express or similar
courier company or transmitted by telefax, addressed to the respective party at
the address set forth below:
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Lessor: Eagle Geophysical, Inc.
00 Xxxxx Xxxxxx Xxxx, 0xx Xxxxx Xxxx
Xxxxxxx, Xxxxx 00000
Fax No. (000) 000-0000
Lessee: Horizon Exploration Limited
0 Xxxxxxxx Xxxx
Xxxxxxxxx
Xxxx XX00 0XX
Xxxxxxx
Fax No. 000-000-000-000-000
(b) Either of the parties hereto may change its address by notice
in writing given to the other party to this Lease.
27. TERMINATION UPON DEFAULT UNDER NATIONSBANK LOAN. The parties
hereto acknowledge that Lessor has financed the acquisition of the Equipment
with the proceeds of a loan from NationsBanc Leasing Corporation of North
Carolina ("NationsBanc"). Notwithstanding the lease of the Equipment by Lessor
to Lessee hereunder, Lessor shall remain fully obligated and in compliance with
the terms and conditions of the agreement governing the loan from NationsBanc
(the "Loan Agreement"). Upon NationsBanc's delivery to Lessee of notice that
an Event of Default (as such term is defined in the Loan Agreement) has
occurred and is continuing under the Loan Agreement and that NationsBanc has
commenced the exercise of remedies with respect to the Equipment under the Loan
Agreement, this Lease will automatically terminate and be of no further force
or effect, and Lessee will cause the Equipment to be delivered to NationsBanc
at a place to be designated by NationsBanc. Any termination of this Lease
pursuant to this Paragraph 27 shall be without prejudice to any claims of the
parties hereto against each other with respect to this Lease arising prior to
or as a result of such termination.
EAGLE GEOPHYSICAL, INC.
By: /s/ XXX XXXXXXXXX
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Xxx Xxxxxxxxx, President
HORIZON EXPLORATION LIMITED
By: /s/ XXXXX XXXXXXXX
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Name: Xxxxx Xxxxxxxx
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Title: Director
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