Mitcham Industries Announces Expansion of Credit Facility and Capex Plans

HUNTSVILLE, Texas, Aug. 2 /PRNewswire-FirstCall/ -- Mitcham Industries, Inc. (Nasdaq: MIND) (the "Company") today announced that it has entered into an amended revolving credit agreement with First Victoria National Bank and The Frost National Bank (collectively the "Banks").  The amended credit agreement provides for total borrowings of up to $35 million on a revolving basis through May 31, 2012, up from the $25 million available previously. Borrowings under the amended facility bear interest at 50 basis points over prime.  Other terms of the agreement are essentially unchanged from the company's previous $25 million credit facility with the Banks.  In addition, the Company announced that it now expects additions to its lease pool to total between $22 million and $25 million in the fiscal year ending January 31, 2011.

Bill Mitcham, the Company's President and CEO, stated, "We are seeing increased inquiries and bid activity from our customers in many parts of the world.  Accordingly, we have made the decision to commit additional capital to our lease pool so that we can respond quickly to increased demand.  The equipment we are adding includes the 7,500 stations of Sercel Unite cable-free technology that we recently announced, additional traditional land channels, geophones, marine equipment, as well as other items.  We have taken delivery of more than half of the expected purchases and expect to take delivery of the balance of the equipment during the course of the next few months.  We are excited about the opportunities we see before us and look forward to meeting the needs of our customers."

"Recently we significantly reduced the outstanding balance under our revolving credit facility, leaving $9.3 million outstanding as of July 31, 2010.  Despite this reduction in borrowings, we thought now was the right time to expand and extend this facility in order to preserve our financial flexibility for the foreseeable future. We believe that the expansion and extension of our credit facility will provide us with the flexibility to take advantage of the opportunities that we are seeing now and that we expect to arise during the current recovery of the seismic industry. The amended facility provides us with additional borrowing capacity and has no required repayments until May 2012."

Mitcham Industries, Inc., a geophysical equipment supplier, offers for lease or sale, new and "experienced" seismic equipment to the oil and gas industry, seismic contractors, environmental agencies, government agencies and universities. Headquartered in Texas, with sales and services offices in Calgary, Canada; Brisbane, Australia; Singapore; Ufa, Bashkortostan, Russia; Lima, Peru; Bogota, Colombia and the United Kingdom and with associates throughout Europe, South America and Asia, Mitcham conducts operations on a global scale and is the largest independent exploration equipment lessor in the industry.

This press release includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included herein, including statements regarding the Company's future financial position and results of operations, planned capital expenditures, the Company's business strategy and other plans for future expansion, the future mix of revenues and business, future demand for the Company's services and general conditions in the energy industry in general and seismic service industry, are forward-looking statements. While management believes that these forward-looking statements are reasonable when and as made, actual results may differ materially from such forward-looking statements. Important factors that could cause or contribute to such differences include possible decline in demand for seismic data and our services; the effect of  fluctuations in oil and natural gas prices on exploration activity; the effect of uncertainty in financial markets on our customers' and our ability to obtain financing; loss of significant customers; seasonal fluctuations that can adversely affect our business; defaults by customers on amounts due us; possible impairment of long-lived assets; risks associated with our manufacturing  operations; inability to obtain funding or to obtain funding under acceptable terms; intellectual property claims by third parties; risks associated with our foreign operation, including foreign currency exchange risk; and other factors that are disclosed in the Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, which are available from the Company without charge. Readers are cautioned to not place undue reliance on forward-looking statements which speak only as of the date of this release and the Company undertakes no duty to update or revise any forward-looking statement whether as a result of new information, future events or otherwise.

SOURCE Mitcham Industries, Inc.