EXHIBIT 10.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this "Agreement") is made as of the 1st day of August, 1997 between OYO GEOSPACE CORPORATION, a Delaware corporation having its principal operating offices at 7334 N. Gessner, Houston, Texas 77040 (the "Company"), and Gary D. Owens ("Employee"), having a mailing address at 1 Flamingo Island Drive, Missouri City, Texas 77459;

W I T N E S S E T H:

WHEREAS, the Company considers the establishment and maintenance of a sound and vital management to be essential to protecting and enhancing the best interest of the Company and its stockholders; and

WHEREAS, in order to induce Employee to remain in the employ of the Company under the terms as set forth herein, the Company is willing to agree to provide certain severance benefits to Employee in the event Employee's employment is terminated under the circumstances described below;

NOW, THEREFORE, in consideration of the mutual premises and conditions contained herein, the parties hereto agree as follows:

1. TERM

1.1 Contract Term. This Agreement shall commence on the date

hereof and shall continue until December 31, 1998; provided, however, that commencing January 1, 1999, and each January 1 thereafter the term of this Agreement shall automatically be extended for an additional two years unless no fewer than thirty (30) days prior to such January 1 date, the Company shall have given notice that it does not wish to extend this Agreement.

1.2 Consideration by Employee. In consideration of the Company's entering into this Agreement, Employee hereby agrees that, for the period commencing on the date hereof and extending through December 31, 1998, Employee will not voluntarily terminate employment with the Company, except in the event of a substantial change in Employee's position, duties, compensation or benefits which would be deemed "Good Reason" for Employee to terminate his employment in accordance with Section 2.3, without the Company's consenting

to such termination. As further consideration, Employee hereby agrees to the Restrictions set forth in Section 4 hereof.

2. TERMINATION OF EMPLOYMENT

Employee shall be entitled to the benefits provided in section 3 hereof upon the termination of his employment, unless such termination is (a) because of his death, "Disability" or "Retirement" (as defined in Section 2.1 below), (b) by the Company for "Cause" (as defined in Section 2.2 below), or (c) by Employee other than for "Good Reason" (as defined in Section 2.3 hereof).

2.1 Disability, Retirement.

2.1.1 If, as a result of Employee's incapacity due to physical or mental illness, Employee shall have been absent from his duties with the Company on a full-time basis for 120 consecutive business days, and within thirty (30) days after written notice of termination is given Employee shall not have returned to the full-time performance of his duties, the Company may terminate his employment for "Disability."

2.1.2 Termination by the Company or Employee of his employment based on "Retirement" shall mean termination because Employee has retired after reaching age 65.

2.2 Cause. The Company may terminate Employee's employment for

"Cause." For the purposes of this Agreement, the Company shall have "cause" to terminate Employee's employment hereunder upon (A) the willful and continued failure by Employee to perform his duties with the Company (other than any such failure resulting from incapacity due to physical or mental illness), after a demand for substantial performance is delivered to Employee by the Board of Directors of the Company (the "Board") which specifically identifies the manner in which the Board believes that he has not substantially performed his duties, or (B) the willful engaging by Employee in gross misconduct materially and demonstrably injurious to the Company. For purposes of this paragraph, no act, or failure to act, on Employee's part shall be considered "willful" unless done, or omitted to be done, by him not in good faith and without reasonable belief that his action or omission was not in the best interest of the Company. Notwithstanding the foregoing, Employee shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to him a

copy of a resolution duly adopted by the affirmative vote of not less than two-thirds (2/3) of the entire authorized membership of the Board at a meeting of the Board called and held for the purpose (after reasonable notice and an opportunity for Employee, together with counsel, to be heard before the Board), finding that in the good faith opinion of the Board he was guilty of conduct set forth above in clauses (A) or (B) of the second sentence of this paragraph and specifying the particulars thereof in detail.

2.3 Good Reason. Employee may terminate his employment for Good Reason. For purposes of this Agreement, "Good Reason" shall mean:

2.3.1 Without his express written consent, the assignment to Employee of any duties inconsistent with his positions, duties, responsibilities and status with the Company, or a change in his reporting responsibilities, titles or offices, or any removal of Employee from or failure to re- elect Employee to any of such positions, except in connection with the termination of his employment for cause, Disability or Retirement or as a result of his death or by Employee other than for Good Reason;

2.3.2 A reduction by the Company in Employee's base salary as in effect on the date hereof or as the same may be increased from time to time;

2.3.3 The Company's requiring Employee to be based anywhere other than the Company's office at which he was based except for required travel on the Company's business to an extent substantially consistent with the business travel obligations of a company engaged in the Company's businesses, as they may from time to time be engaged in, and consistent with the Company's current circumstance as an indirect wholly-owned subsidiary of a Japanese company based in Tokyo, Japan, or, in the event Employee consents to any relocation, the failure by the Company to pay (or reimburse Employee) for all reasonable moving expenses incurred by him relating to a change of his principal residence in connection with such relocation and to indemnify Employee against any loss (defined as the difference between the actual net sale price of such residence after commissions and other closing costs and the higher of (a) his aggregate investment in such residence or (b) the fair market value of such residence as determined by a real estate appraiser designated by Employee and reasonably satisfactory to the Company) realized on the sale of Employee's principal residence in connection with any such change of residence;

2.3.4 The failure by the Company to continue in effect any benefit or compensation plan (including but not limited to any stock option plan, 401(k) plan, life insurance plan, health and accident plan or disability plan) in which Employee is participating (or plans providing substantially similar benefits) unless there is put in place by the Company a substitute plan therefor which is designed to provide similar economic benefits to Employee, the taking of any action by the Company which would adversely affect Employee's participation in or materially reduce his benefits under any of such plans or deprive him of any material fringe benefit enjoyed by him unless the Employee is given the opportunity to participate in a plan that provides a similar economic benefit or is given an economically equivalent fringe benefit, or the failure by the Company to provide Employee with the number of paid vacation days to which he is then entitled on the basis of years of service with the Company in accordance with the Company's normal vacation policy in effect on the date hereof;

2.3.5 Any failure of the Company to obtain the assumption of, or the agreement to perform, this Agreement by any successor as contemplated in Section 5 hereof; or

2.3.6 Any purported termination of Employee's employment which is not affected pursuant to a Notice of Termination satisfying the requirements of Section 2.4 below (and, if applicable, Section 2.2 above).

2.4 Notice of Termination. Any termination by the Company pursuant to Sections 2.1 and 2.2 above or by Employee pursuant to Sections 2.1.2 and 2.3 above shall be communicated by written Notice of Termination to the other party hereto. For purposes of this Agreement, a "Notice of Termination" shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Employee's employment under the provision so indicated. In the event that Employee seeks to terminate his employment with the Company pursuant to Section 2.3 above, he must communicate his written Notice of Termination to the Company within sixty (60) days of being notified of such action or actions by the Company which constitute Good Reason for termination.

2.5 Date of Termination. "Date of Termination" shall mean
(i) if this Agreement is terminated for Disability, thirty (30) days after Notice of Termination is given (provided that Employee shall not have returned to the

performance of his duties on a full-time basis during such thirty (30) day period); and (ii) if Employee's employment is terminated for any other reason, the date on which a Notice of Termination is given.

3. COMPENSATION UPON TERMINATION OR DURING DISABILITY.

3.1 Disability. During any period that Employee fails to perform his duties hereunder as a result of incapacity due to physical or mental illness, he shall continue to receive his full base salary at the rate then in effect and any installments of deferred portions of awards under any incentive, bonus, or other compensation plan paid during such period until this Agreement is terminated pursuant to
Section 2 hereof. Thereafter, Employee's benefits shall be determined in accordance with the Company's long term disability income insurance plan, or a substitute plan then in effect.

3.2 Termination for Cause. If Employee's employment shall be terminated for Cause, the Company shall pay Employee his full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given and the Company shall have no further obligations to Employee under this Agreement.

3.3 Termination Without Cause. If the Company shall terminate Employee's employment other than pursuant to Sections 2.1 or 2.2 hereof or if Employee shall terminate his employment for Good Reason, then the Company shall pay to Employee as severance pay in a lump sum not later than the tenth (10th) day following the Date of Termination, the following amounts:

3.3.1 Employee's full base salary through the Date of Termination at the rate in effect at the time the Notice of Termination is given;

3.3.2 In lieu of any further salary payments to Employee for periods subsequent to the Date of Termination, an amount equal to the product of (a) Employee's annual base salary at the rate in effect as of the Date of Termination plus the amount of the management incentive bonus to which Employee would have been entitled for the fiscal year in which the Notice of Termination is given, pro rated for his period of service, or if higher the amount of the management incentive bonus paid to Employee in respect of the previous fiscal year, multiplied by (b) two (2);

3.3.3 The Company shall also pay (i) all relocation and indemnity payments as set forth in Section 2.3.3 hereof, and
(ii) all legal fees and

expenses incurred by Employee as a result of such termination (including all such fees and expenses, if any, incurred in contesting or disputing any such termination or in seeking to obtain or enforce any right or benefit provided by this Agreement plus pre-judgment and post-judgment interest at the prime rate of interest in effect at the Date of Termination as announced by Texas Commerce Bank of Houston (the "Prime Rate"); provided, however, that Employee shall not be entitled to the payments provided for in clause (ii) if Employee shall have given Notice of Termination for Good Reason, but it shall finally be determined, pursuant to Section 11 hereof, that Good Reason did not exist.

3.3.4 In the event the Employee is subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), an amount equal to the product of (a) 25% multiplied by (b) the amount of any "excess parachute payment" received or receivable by the Employee under this Agreement, under any stock option agreement, or under any other agreement, arrangement, or plan in which the Employee participates; for purposes of this Agreement, "excess parachute payment" has the meaning given to such term by Section 280G(b) of the Code.

3.4 Benefit Plans. Unless Employee is terminated for Cause, the Company shall maintain in full force and effect for the continued benefit of Employee, for a two-year period after the Date of Termination, all employee benefit plans and programs or arrangements in which Employee was entitled to participate immediately prior to the Date of Termination provided that his continued participation is possible under the general terms and provisions of such plans and programs. In the event that Employee's participation in any such plan or program is barred, the Company shall arrange to provide Employee with benefits substantially similar to those which he is entitled to receive under such plans and programs.

3.5 Mitigation of Amounts Payable Hereunder. Employee shall not be required to mitigate the amount of any payment provided for in this Section 3 by seeking other employment or otherwise, nor shall the amount of any payment provided for in this Section 3 be reduced by any compensation earned by Employee as the result of employment by another employer after the Date of Termination, or otherwise.

3.6 Late Payments. In the event any amount to be paid to Employee hereunder is not paid by the date specified herein, such amount shall bear interest at the Prime Rate.

3.7 Determination of Base Salary. In the event Employee terminates this Agreement pursuant to Section 2.3.2 hereof, Employee's base salary for purposes of determining benefits pursuant to this Section 3 shall be Employee's base salary in effect prior to its reduction by the Company.

4. OWNERSHIP OF INTELLECTUAL PROPERTY - CONFIDENTIALITY

4.1 Definitions. As used in this Section 4, the following words or phrases shall have the following definitions:

4.1.1 The term "Business Entity" shall mean any corporation, partnership, joint venture, proprietorship, or other incorporated or unincorporated organization, association or entity, including any division or business operated by any of the foregoing under a trade or assumed name.

4.1.2 The term "Subsidiaries" shall mean and include any Business Entities in which the Company owns an interest, directly or indirectly.

4.1.3 The term "Company" shall mean and include OYO GEOSPACE CORPORATION, its successors and assigns, its subsidiaries, its parent companies, and any of the foregoing operating under a trade or assumed name.

4.1.4 The term "Employee of the Company" shall mean any person employed by the Company in any capacity at any time during the term of this Agreement, or any renewal or extension thereof.

4.1.5 The term "Customer" shall mean any person, or Business Entity which has, in the past or at any time during the term of this Agreement or any renewal or extension hereof, contracted, including by purchase order, with the Company for the development, manufacture, lease, repair, sale or purchase of any Product or the license from the Company of any Intellectual Property.

4.1.6 The term "Product" shall mean a Seismic Data Acquisition System and/or any other equipment, machine, service, product, instrument or system researched, developed, conceived, manufactured, assembled, sold or distributed by the Company at any time.

4.1.7 The term "Seismic Data Acquisition System(s)" shall mean and include (i) all systems, machines, instruments and equipment capable of (a) acquiring a multiplicity of input, (b) formatting a multiplicity of input analog data, and (c) filtering, digitizing and storing input data on

suitable storage devices, (ii) peripheral processors, such as field correlators, summing processors and other support equipment manufactured, leased, repaired or sold by the Company, and (iii) support equipment developed by the Company before the date of the termination of this Agreement.

4.1.8 The term "Intellectual Property" shall mean all methods, patents, formulae, inventions, designs, systems, processes, trade secrets, copyrights, know-how, proprietary information, rights, trademarks, and trade names relating to any Product conceived, developed, completed or established by the Company, or by Employee (whether solely or jointly with others) during the term of this Agreement (including any renewal or extension hereof) (i) at the Company's expense, (ii) at the Company's request, (iii) using the Company's time, data, facilities and/or materials, or (iv) based upon knowledge or information obtained from the Company, and shall include all modifications and improvements thereof made at any time.

4.2 Intellectual Property of the Company. Employee agrees:

4.2.1 That all Intellectual Property, and all notes, drawings, software, prototypes or other objects, information or writings relating thereto are the sole property of Company;

4.2.2 To communicate and explain to the Company, promptly and fully, all Intellectual Property;

4.2.3 To execute and deliver to Company such assignments or other documents as may be reasonably required to evidence or confirm the ownership of all Intellectual Property by the Company;

4.2.4 To perform such acts and execute such documents as may be reasonably required to allow the Company to prosecute an application for patent or registration of copyright on any such Intellectual Property, from the United States and from any other government, and to cooperate fully with the company in the prosecution of any such application or registration, which obligation shall survive the termination of Employee's employment with the Company.

4.2.5 All inventions or discoveries, if any, patented or unpatented, which Employee has made prior to this employment by the Company are described on Exhibit "A". All Intellectual Property other than those items specifically described on Exhibit "A" shall constitute the property of the Company.

4.3 Confidentiality.

4.3.1 Employee acknowledges that the Company's continued operations and success in the development, manufacture, leasing, repair, and sale of its Products is dependent upon (i) certain processes, formulae,

specifications, designs, systems, and confidential information of the Company which are valuable, special and unique assets and (ii) the Company's continuing relationship with, and knowledge about, Customers and prospective Customers and the goodwill these relationships create. Employee acknowledges that all of the following information is confidential and a valuable, special, and unique asset of the Company's business: (i) the names, addresses and telephone numbers of Customers, their employees, and their representatives, (ii) the nature of the business and operations of any Customer, (iii) the amount, nature, volume, and other information regarding any Products purchased, leased or otherwise acquired by any Customer or required by any Customer; (iv) the nature of the internal business operations of the Company; (v) the methods, processes, formulae, specifications, designs, systems, and know-how used, developed, or acquired by the Company for the development, manufacture, and repair of any Product; (vi) the Company's prices or charges to Customers for its Products; (vii) the Intellectual Property developed or acquired by the Company and (viii) information regarding the salaries, bonuses or other compensation paid by the Company to its employees.

4.3.2 Employee acknowledges that all of the information described in Section 4.3.1 is "Confidential Information," which together with the Intellectual Property is the sole and exclusive property of the Company. Employee acknowledges that all Confidential Information and the Intellectual Property is revealed to Employee in trust, based solely upon the confidential relationship existing between the Company and the Employee. Employee agrees: (i) that all writings or other records concerning Confidential Information and the Intellectual Property are the sole and exclusive property of the Company; (ii) that all manuals, forms, and supplies furnished to or used by the Employees and all data or information placed thereon by Employee or any other person are the Company's sole and exclusive property, (iii) that, upon termination of this Agreement howsoever such termination is brought about, or upon request of the Company at any time, Employee shall deliver to the Company all such writings, records, forms, manuals, and supplies and all copies of such writings; (iv) that the Employee will not make or retain any copies of such writings for his own or personal use, or take the originals or copies of any such writings from the offices of the Company upon termination of this Agreement; and (v) that Employee will not, either during or after the term of this Agreement, publish, distribute or deliver any of such writings or records to any other person or entity, or disclose to any person or entity the contents of such records or writings or any of the Confidential Information nor any information regarding the Intellectual Property.

4.4 Reasonableness of Restrictions. Employee acknowledges that the restrictions contained in Section 4.2 and 4.3 hereof (the "Restrictions"), in view

of the nature of the business in which the Company is engaged, are reasonable and necessary in order to protect the legitimate interests of the Company, and that any violation thereof would result in irreparable injury to the Company, and Employee therefore further acknowledges that, in the event Employee violates, or threatens to violate, any of such Restrictions, the Company shall be entitled to obtain from any court of competent jurisdiction, without the posting of any bond or other security, preliminary and permanent injunctive relief as well as damages and an equitable accounting of all earnings, profits and other benefits arising from such violation, which rights shall be cumulative and in addition to any other rights or remedies in law or equity to which the Company or any affiliate or subsidiary of the Company may be entitled. If Employee violates any of the Restrictions, the restricted period shall not run in favor of Employee from the time of commencement of any such violation until such time as such violation shall be cured by Employee to the satisfaction of the Company.

4.5 Severability of Restrictions. If any Restriction, or any part thereof, is determined in any judicial or administrative proceeding to be invalid or unenforceable, the remainder of the Restrictions shall not thereby be affected and shall be given full effect, without regard to the invalid provisions. If the period of time or scope of activity in the Restrictions should be adjudged unreasonable in any judicial or administrative proceeding, then the court or administrative body shall have the power to reduce the period of time or the scope covered and, in its reduced form, such provision shall then be enforceable and shall be enforced.

4.6 Intellectual Property of Others. Employee recognizes that the Company has a long standing policy to not knowingly violate the valid intellectual property rights, including patents, trade secrets and copyrights, of other persons. In order to comply with such policy, Employee covenants that he will comply with such policy and that his willful breach of this covenant could constitute "Cause" within the meaning of Section 2.2 hereof. Employee covenants, represents and warrants in these regards as follows:

4.6.1 Exhibit B hereto contains a true, complete and accurate list of all inventions, copyrights and patents of Employee relevant to the subject matter of the employment of Employee by Oyo Geospace Corporation that have been made or conceived or first reduced to practice by Employee alone or jointly with others prior to the employment of Employee by the Company. If disclosure of any such inventions on Exhibit B would cause Employee to violate any prior confidentiality agreement, Employee understands that such inventions are not to be listed on Exhibit B but Oyo Geospace Corporation is to be informed that all such inventions have not been listed for that reason.

4.6.2 Employee's performance of all of the duties and obligations of employment at Oyo Geospace Corporation does not and will not breach any agreement or duty to keep in confidence confidential information acquired by Employee in confidence or in trust prior to the employment of Employee by Oyo Geospace Corporation. During Employee's work with the Company, Employee will not improperly use or disclose any confidential information or trade secrets of any former employer or any other person to whom Employee has an obligation of confidentiality, and Employee will not bring onto the premises of the Company any unpublished documents or any property belonging to any former employer or any other person to whom Employee has an obligation of confidentiality unless consented to in writing by that former employer or person. Employee will use in the performance of duties only information which is generally known and used by persons with training and experience comparable to Employee's, which is common knowledge in the industry or otherwise legally in the public domain, or which is or was developed by Employee free of any confidential obligations to former employers or other persons.

4.6.3 Employee is not restricted from being employed by Oyo Geospace Corporation or entering into this Agreement. Employee has not entered into, and agrees not to enter into, any agreement either written or oral in conflict herewith.

4.6.4 Employee represents and warrants that, other than as set forth on Exhibit B hereto, Employee has not brought to the Company and covenants that Employee will not bring to the Company or use in the performance of Employee's responsibilities any confidential information, materials or documents of any former employers or other persons that are not generally available to the public, unless Employee has obtained prior written authorization from the former employers or other persons. Employee hereby covenants that Employee shall not breach any obligation of confidentiality or duty that Employee may have to former employers or other persons.

5. SUCCESSORS; BINDING AGREEMENT.

5.1 Successors of the Company. The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, by agreement in form and substance satisfactory to Employee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. Failure of the Company to obtain such agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle Employee to compensation from the Company in the same amount and on the same terms as Employee would be entitled hereunder if Employee terminated his employment for Good Reason, except that for purposes or implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Date of Termination. As used in this Agreement, "Company" shall mean the company as hereinbefore defined and any successor to its business and/or assets as aforesaid which executes and delivers the agreement provided for in this Section 5 or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of law.

6. NOTICE. For the purposes of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered or certified mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement, provided that all notices to the Company shall be directed to the attention of the Chairman of the Board of the Company with a copy to the Secretary of the Company, except that notices of change of address shall be effective only upon receipt.

7. MISCELLANEOUS. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing signed by Employee and such officer as may be specifically designated by the Board of Directors of the Company. No waiver by either party hereto at

any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement.

8. VALIDITY. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

9. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

10. GOVERNING LAW. This Agreement shall be governed by and construed under the laws of the State of Texas.

11. ARBITRATION. Except as contemplated by Section 4.4 hereof, any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration in Houston, Texas (in accordance with the rules of the American Arbitration Association then in effect). Notwithstanding the pendency of any such dispute or controversy, the Company will continue to pay Employee his full compensation in effect when the notice giving rise to the dispute was given and continue Employee as a participant in all compensation, benefit and insurance plans in which he was participating when the notice giving rise to the dispute was given, until the dispute is finally resolved. Amounts paid under this paragraph are in addition to all other amounts due under this Agreement and shall not be offset against or reduce any other amounts due under this Agreement. Judgment may be entered on the arbitrator's award in any court having jurisdiction; provided, however, that Employee shall be entitled to seek specific performance of his right to be paid until the Date of Termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

12. CAPTIONS AND GENDER. The use of captions and Section headings herein is for the purpose of convenience only and shall not affect the interpretation or substance of any provision contained herein. Similarly, the use of the masculine gender with respect to pronouns in this Agreement is for the purpose of convenience and includes either sex who may be a signatory.

13. PRIOR AGREEMENTS. This Agreement supersedes all prior agreements entered into between the Company and Employee with regard to the subject matter set forth herein; provided, however, that this Agreement shall not supersede that letter agreement dated July 15, 1997, between the Company and Employee, which shall continue in full force and effect as to the matters covered thereby and for the period contemplated thereby.

IN WITNESS WHEREOF, the parties hereof have signed this Agreement as of the 31st day of July 1997.

OYO GEOSPACE CORPORATION

By /s/ ERNEST M. HALL
   --------------------------------
Name  Ernest M. Hall, Jr.
    -------------------------------
Title  President
     ------------------------------

(EMPLOYEE)

/s/ GARY D. OWENS
-----------------------------------

EXHIBIT 10.2

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this "Agreement") is made as of the 1st day of August, 1997 between OYO GEOSPACE CORPORATION, a Delaware corporation having its principal operating offices at 7334 N. Gessner, Houston, Texas 77040 (the "Company"), and Michael J. Sheen ("Employee"), having a mailing address at 11910 North Hanworth, Houston, Texas 77031;

W I T N E S S E T H:

WHEREAS, the Company considers the establishment and maintenance of a sound and vital management to be essential to protecting and enhancing the best interest of the Company and its stockholders; and

WHEREAS, in order to induce Employee to remain in the employ of the Company under the terms as set forth herein, the Company is willing to agree to provide certain severance benefits to Employee in the event Employee's employment is terminated under the circumstances described below;

NOW, THEREFORE, in consideration of the mutual premises and conditions contained herein, the parties hereto agree as follows:

1. TERM

1.1 Contract Term. This Agreement shall commence on the date hereof and shall continue until December 31, 1998; provided, however, that commencing January 1, 1999, and each January 1 thereafter the term of this Agreement shall automatically be extended for an additional two years unless no fewer than thirty (30) days prior to such January 1 date, the Company shall have given notice that it does not wish to extend this Agreement.

1.2 Consideration by Employee. In consideration of the Company's entering into this Agreement, Employee hereby agrees that, for the period commencing on the date hereof and extending through December 31, 1998, Employee will not voluntarily terminate employment with the Company, except in the event of a substantial change in Employee's position, duties, compensation or benefits which would be deemed "Good Reason" for Employee to terminate his employment in accordance with Section 2.3, without the Company's consenting

to such termination. As further consideration, Employee hereby agrees to the Restrictions set forth in Section 4 hereof.

2. TERMINATION OF EMPLOYMENT

Employee shall be entitled to the benefits provided in section 3 hereof upon the termination of his employment, unless such termination is
(a) because of his death, "Disability" or "Retirement" (as defined in
Section 2.1 below), (b) by the Company for "Cause" (as defined in Section 2.2 below), or (c) by Employee other than for "Good Reason" (as defined in Section 2.3 hereof).

2.1 Disability, Retirement.

2.1.1 If, as a result of Employee's incapacity due to physical or mental illness, Employee shall have been absent from his duties with the Company on a full-time basis for 120 consecutive business days, and within thirty (30) days after written notice of termination is given Employee shall not have returned to the full-time performance of his duties, the Company may terminate his employment for "Disability."

2.1.2 Termination by the Company or Employee of his employment based on "Retirement" shall mean termination because Employee has retired after reaching age 65.

2.2 Cause. The Company may terminate Employee's employment for "Cause." For the purposes of this Agreement, the Company shall have "cause" to terminate Employee's employment hereunder upon (A) the willful and continued failure by Employee to perform his duties with the Company (other than any such failure resulting from incapacity due to physical or mental illness), after a demand for substantial performance is delivered to Employee by the Board of Directors of the Company (the "Board") which specifically identifies the manner in which the Board believes that he has not substantially performed his duties, or (B) the willful engaging by Employee in gross misconduct materially and demonstrably injurious to the Company. For purposes of this paragraph, no act, or failure to act, on Employee's part shall be considered "willful" unless done, or omitted to be done, by him not in good faith and without reasonable belief that his action or omission was not in the best interest of the Company. Notwithstanding the foregoing, Employee shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to him a

copy of a resolution duly adopted by the affirmative vote of not less than two-thirds (2/3) of the entire authorized membership of the Board at a meeting of the Board called and held for the purpose (after reasonable notice and an opportunity for Employee, together with counsel, to be heard before the Board), finding that in the good faith opinion of the Board he was guilty of conduct set forth above in clauses (A) or (B) of the second sentence of this paragraph and specifying the particulars thereof in detail.

2.3 Good Reason. Employee may terminate his employment for Good Reason. For purposes of this Agreement, "Good Reason" shall mean:

2.3.1 Without his express written consent, the assignment to Employee of any duties inconsistent with his positions, duties, responsibilities and status with the Company, or a change in his reporting responsibilities, titles or offices, or any removal of Employee from or failure to re-elect Employee to any of such positions, except in connection with the termination of his employment for cause, Disability or Retirement or as a result of his death or by Employee other than for Good Reason;

2.3.2 A reduction by the Company in Employee's base salary as in effect on the date hereof or as the same may be increased from time to time;

2.3.3 The Company's requiring Employee to be based anywhere other than the Company's office at which he was based except for required travel on the Company's business to an extent substantially consistent with the business travel obligations of a company engaged in the Company's businesses, as they may from time to time be engaged in, and consistent with the Company's current circumstance as an indirect wholly-owned subsidiary of a Japanese company based in Tokyo, Japan, or, in the event Employee consents to any relocation, the failure by the Company to pay (or reimburse Employee) for all reasonable moving expenses incurred by him relating to a change of his principal residence in connection with such relocation and to indemnify Employee against any loss (defined as the difference between the actual net sale price of such residence after commissions and other closing costs and the higher of (a) his aggregate investment in such residence or (b) the fair market value of such residence as determined by a real estate appraiser designated by Employee and reasonably satisfactory to the Company) realized on the sale of Employee's principal residence in connection with any such change of residence;

2.3.4 The failure by the Company to continue in effect any benefit or compensation plan (including but not limited to any stock option plan, 401(k) plan, life insurance plan, health and accident plan or disability plan) in which Employee is participating (or plans providing substantially similar benefits) unless there is put in place by the Company a substitute plan therefor which is designed to provide similar economic benefits to Employee, the taking of any action by the Company which would adversely affect Employee's participation in or materially reduce his benefits under any of such plans or deprive him of any material fringe benefit enjoyed by him unless the Employee is given the opportunity to participate in a plan that provides a similar economic benefit or is given an economically equivalent fringe benefit, or the failure by the Company to provide Employee with the number of paid vacation days to which he is then entitled on the basis of years of service with the Company in accordance with the Company's normal vacation policy in effect on the date hereof;

2.3.5 Any failure of the Company to obtain the assumption of, or the agreement to perform, this Agreement by any successor as contemplated in Section 5 hereof; or

2.3.6 Any purported termination of Employee's employment which is not affected pursuant to a Notice of Termination satisfying the requirements of Section 2.4 below (and, if applicable, Section 2.2 above).

2.4 Notice of Termination. Any termination by the Company pursuant to Sections 2.1 and 2.2 above or by Employee pursuant to Sections 2.1.2 and 2.3 above shall be communicated by written Notice of Termination to the other party hereto. For purposes of this Agreement, a "Notice of Termination" shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Employee's employment under the provision so indicated. In the event that Employee seeks to terminate his employment with the Company pursuant to Section 2.3 above, he must communicate his written Notice of Termination to the Company within sixty
(60) days of being notified of such action or actions by the Company which constitute Good Reason for termination.

2.5 Date of Termination. "Date of Termination" shall mean (i) if this Agreement is terminated for Disability, thirty (30) days after Notice of Termination is given (provided that Employee shall not have returned to the

performance of his duties on a full-time basis during such thirty (30) day period); and (ii) if Employee's employment is terminated for any other reason, the date on which a Notice of Termination is given.

3. COMPENSATION UPON TERMINATION OR DURING DISABILITY.

3.1 Disability. During any period that Employee fails to perform his duties hereunder as a result of incapacity due to physical or mental illness, he shall continue to receive his full base salary at the rate then in effect and any installments of deferred portions of awards under any incentive, bonus, or other compensation plan paid during such period until this Agreement is terminated pursuant to Section 2 hereof. Thereafter, Employee's benefits shall be determined in accordance with the Company's long term disability income insurance plan, or a substitute plan then in effect.

3.2 Termination for Cause. If Employee's employment shall be terminated for Cause, the Company shall pay Employee his full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given and the Company shall have no further obligations to Employee under this Agreement.

3.3 Termination Without Cause. If the Company shall terminate Employee's employment other than pursuant to Sections 2.1 or 2.2 hereof or if Employee shall terminate his employment for Good Reason, then the Company shall pay to Employee as severance pay in a lump sum not later than the tenth (10th) day following the Date of Termination, the following amounts:

3.3.1 Employee's full base salary through the Date of Termination at the rate in effect at the time the Notice of Termination is given;

3.3.2 In lieu of any further salary payments to Employee for periods subsequent to the Date of Termination, an amount equal to the product of (a) Employee's annual base salary at the rate in effect as of the Date of Termination plus the amount of the management incentive bonus to which Employee would have been entitled for the fiscal year in which the Notice of Termination is given, pro rated for his period of service, or if higher the amount of the management incentive bonus paid to Employee in respect of the previous fiscal year, multiplied by (b) two (2);

3.3.3 The Company shall also pay (i) all relocation and indemnity payments as set forth in Section 2.3.3 hereof, and (ii) all legal fees and

expenses incurred by Employee as a result of such termination (including all such fees and expenses, if any, incurred in contesting or disputing any such termination or in seeking to obtain or enforce any right or benefit provided by this Agreement plus pre-judgment and post-judgment interest at the prime rate of interest in effect at the Date of Termination as announced by Texas Commerce Bank of Houston (the "Prime Rate"); provided, however, that Employee shall not be entitled to the payments provided for in clause (ii) if Employee shall have given Notice of Termination for Good Reason, but it shall finally be determined, pursuant to Section 11 hereof, that Good Reason did not exist.

3.3.4 In the event the Employee is subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), an amount equal to the product of (a) 25% multiplied by (b) the amount of any "excess parachute payment" received or receivable by the Employee under this Agreement, under any stock option agreement, or under any other agreement, arrangement, or plan in which the Employee participates; for purposes of this Agreement, "excess parachute payment" has the meaning given to such term by Section 280G(b) of the Code.

3.4 Benefit Plans. Unless Employee is terminated for Cause, the Company shall maintain in full force and effect for the continued benefit of Employee, for a two-year period after the Date of Termination, all employee benefit plans and programs or arrangements in which Employee was entitled to participate immediately prior to the Date of Termination provided that his continued participation is possible under the general terms and provisions of such plans and programs. In the event that Employee's participation in any such plan or program is barred, the Company shall arrange to provide Employee with benefits substantially similar to those which he is entitled to receive under such plans and programs.

3.5 Mitigation of Amounts Payable Hereunder. Employee shall not be required to mitigate the amount of any payment provided for in this
Section 3 by seeking other employment or otherwise, nor shall the amount of any payment provided for in this Section 3 be reduced by any compensation earned by Employee as the result of employment by another employer after the Date of Termination, or otherwise.

3.6 Late Payments. In the event any amount to be paid to Employee hereunder is not paid by the date specified herein, such amount shall bear interest at the Prime Rate.

3.7 Determination of Base Salary. In the event Employee terminates this Agreement pursuant to Section 2.3.2 hereof, Employee's base salary for purposes of determining benefits pursuant to this Section 3 shall be Employee's base salary in effect prior to its reduction by the Company.

4. OWNERSHIP OF INTELLECTUAL PROPERTY - CONFIDENTIALITY

4.1 Definitions. As used in this Section 4, the following words or phrases shall have the following definitions:

4.1.1 The term "Business Entity" shall mean any corporation, partnership, joint venture, proprietorship, or other incorporated or unincorporated organization, association or entity, including any division or business operated by any of the foregoing under a trade or assumed name.

4.1.2 The term "Subsidiaries" shall mean and include any Business Entities in which the Company owns an interest, directly or indirectly.

4.1.3 The term "Company" shall mean and include OYO GEOSPACE CORPORATION, its successors and assigns, its subsidiaries, its parent companies, and any of the foregoing operating under a trade or assumed name.

4.1.4 The term "Employee of the Company" shall mean any person employed by the Company in any capacity at any time during the term of this Agreement, or any renewal or extension thereof.

4.1.5 The term "Customer" shall mean any person, or Business Entity which has, in the past or at any time during the term of this Agreement or any renewal or extension hereof, contracted, including by purchase order, with the Company for the development, manufacture, lease, repair, sale or purchase of any Product or the license from the Company of any Intellectual Property.

4.1.6 The term "Product" shall mean a Seismic Data Acquisition System and/or any other equipment, machine, service, product, instrument or system researched, developed, conceived, manufactured, assembled, sold or distributed by the Company at any time.

4.1.7 The term "Seismic Data Acquisition System(s)" shall mean and include (i) all systems, machines, instruments and equipment capable of (a) acquiring a multiplicity of input, (b) formatting a multiplicity of input analog data, and (c) filtering, digitizing and storing input data on

suitable storage devices, (ii) peripheral processors, such as field correlators, summing processors and other support equipment manufactured, leased, repaired or sold by the Company, and (iii) support equipment developed by the Company before the date of the termination of this Agreement.

4.1.8 The term "Intellectual Property" shall mean all methods, patents, formulae, inventions, designs, systems, processes, trade secrets, copyrights, know-how, proprietary information, rights, trademarks, and trade names relating to any Product conceived, developed, completed or established by the Company, or by Employee (whether solely or jointly with others) during the term of this Agreement (including any renewal or extension hereof) (i) at the Company's expense, (ii) at the Company's request, (iii) using the Company's time, data, facilities and/or materials, or (iv) based upon knowledge or information obtained from the Company, and shall include all modifications and improvements thereof made at any time.

4.2 Intellectual Property of the Company. Employee agrees:

4.2.1 That all Intellectual Property, and all notes, drawings, software, prototypes or other objects, information or writings relating thereto are the sole property of Company;

4.2.2 To communicate and explain to the Company, promptly and fully, all Intellectual Property;

4.2.3 To execute and deliver to Company such assignments or other documents as may be reasonably required to evidence or confirm the ownership of all Intellectual Property by the Company;

4.2.4 To perform such acts and execute such documents as may be reasonably required to allow the Company to prosecute an application for patent or registration of copyright on any such Intellectual Property, from the United States and from any other government, and to cooperate fully with the company in the prosecution of any such application or registration, which obligation shall survive the termination of Employee's employment with the Company.

4.2.5 All inventions or discoveries, if any, patented or unpatented, which Employee has made prior to this employment by the Company are described on Exhibit "A". All Intellectual Property other than those items specifically described on Exhibit "A" shall constitute the property of the Company.

4.3 Confidentiality.

4.3.1 Employee acknowledges that the Company's continued operations and success in the development, manufacture, leasing, repair, and sale of its Products is dependent upon (i) certain processes, formulae,

specifications, designs, systems, and confidential information of the Company which are valuable, special and unique assets and (ii) the Company's continuing relationship with, and knowledge about, Customers and prospective Customers and the goodwill these relationships create. Employee acknowledges that all of the following information is confidential and a valuable, special, and unique asset of the Company's business: (i) the names, addresses and telephone numbers of Customers, their employees, and their representatives, (ii) the nature of the business and operations of any Customer, (iii) the amount, nature, volume, and other information regarding any Products purchased, leased or otherwise acquired by any Customer or required by any Customer; (iv) the nature of the internal business operations of the Company; (v) the methods, processes, formulae, specifications, designs, systems, and know-how used, developed, or acquired by the Company for the development, manufacture, and repair of any Product; (vi) the Company's prices or charges to Customers for its Products; (vii) the Intellectual Property developed or acquired by the Company and
(viii) information regarding the salaries, bonuses or other compensation paid by the Company to its employees.

4.3.2 Employee acknowledges that all of the information described in Section 4.3.1 is "Confidential Information," which together with the Intellectual Property is the sole and exclusive property of the Company. Employee acknowledges that all Confidential Information and the Intellectual Property is revealed to Employee in trust, based solely upon the confidential relationship existing between the Company and the Employee. Employee agrees: (i) that all writings or other records concerning Confidential Information and the Intellectual Property are the sole and exclusive property of the Company; (ii) that all manuals, forms, and supplies furnished to or used by the Employees and all data or information placed thereon by Employee or any other person are the Company's sole and exclusive property, (iii) that, upon termination of this Agreement howsoever such termination is brought about, or upon request of the Company at any time, Employee shall deliver to the Company all such writings, records, forms, manuals, and supplies and all copies of such writings; (iv) that the Employee will not make or retain any copies of such writings for his own or personal use, or take the originals or copies of any such writings from the offices of the Company upon termination of this Agreement; and (v) that Employee will not, either during or after the term of this Agreement, publish, distribute or deliver any of such writings or records to any other person or entity, or disclose to any person or entity the contents of such records or writings or any of the Confidential Information nor any information regarding the Intellectual Property.

4.4 Reasonableness of Restrictions. Employee acknowledges that the restrictions contained in Section 4.2 and 4.3 hereof (the "Restrictions"), in view

of the nature of the business in which the Company is engaged, are reasonable and necessary in order to protect the legitimate interests of the Company, and that any violation thereof would result in irreparable injury to the Company, and Employee therefore further acknowledges that, in the event Employee violates, or threatens to violate, any of such Restrictions, the Company shall be entitled to obtain from any court of competent jurisdiction, without the posting of any bond or other security, preliminary and permanent injunctive relief as well as damages and an equitable accounting of all earnings, profits and other benefits arising from such violation, which rights shall be cumulative and in addition to any other rights or remedies in law or equity to which the Company or any affiliate or subsidiary of the Company may be entitled. If Employee violates any of the Restrictions, the restricted period shall not run in favor of Employee from the time of commencement of any such violation until such time as such violation shall be cured by Employee to the satisfaction of the Company.

4.5 Severability of Restrictions. If any Restriction, or any part thereof, is determined in any judicial or administrative proceeding to be invalid or unenforceable, the remainder of the Restrictions shall not thereby be affected and shall be given full effect, without regard to the invalid provisions. If the period of time or scope of activity in the Restrictions should be adjudged unreasonable in any judicial or administrative proceeding, then the court or administrative body shall have the power to reduce the period of time or the scope covered and, in its reduced form, such provision shall then be enforceable and shall be enforced.

4.6 Intellectual Property of Others. Employee recognizes that the Company has a long standing policy to not knowingly violate the valid intellectual property rights, including patents, trade secrets and copyrights, of other persons. In order to comply with such policy, Employee covenants that he will comply with such policy and that his willful breach of this covenant could constitute "Cause" within the meaning of Section 2.2 hereof. Employee covenants, represents and warrants in these regards as follows:

4.6.1 Exhibit B hereto contains a true, complete and accurate list of all inventions, copyrights and patents of Employee relevant to the subject matter of the employment of Employee by Oyo Geospace Corporation that have been made or conceived or first reduced to practice by Employee alone or jointly with others prior to the employment of Employee by the Company. If disclosure of any such inventions on Exhibit B would cause Employee to violate any prior confidentiality agreement, Employee understands that such inventions are not to be listed on Exhibit B but Oyo Geospace Corporation is to be informed that all such inventions have not been listed for that reason.

4.6.2 Employee's performance of all of the duties and obligations of employment at Oyo Geospace Corporation does not and will not breach any agreement or duty to keep in confidence confidential information acquired by Employee in confidence or in trust prior to the employment of Employee by Oyo Geospace Corporation. During Employee's work with the Company, Employee will not improperly use or disclose any confidential information or trade secrets of any former employer or any other person to whom Employee has an obligation of confidentiality, and Employee will not bring onto the premises of the Company any unpublished documents or any property belonging to any former employer or any other person to whom Employee has an obligation of confidentiality unless consented to in writing by that former employer or person. Employee will use in the performance of duties only information which is generally known and used by persons with training and experience comparable to Employee's, which is common knowledge in the industry or otherwise legally in the public domain, or which is or was developed by Employee free of any confidential obligations to former employers or other persons.

4.6.3 Employee is not restricted from being employed by Oyo Geospace Corporation or entering into this Agreement. Employee has not entered into, and agrees not to enter into, any agreement either written or oral in conflict herewith.

4.6.4 Employee represents and warrants that, other than as set forth on Exhibit B hereto, Employee has not brought to the Company and covenants that Employee will not bring to the Company or use in the performance of Employee's responsibilities any confidential information, materials or documents of any former employers or other persons that are not generally available to the public, unless Employee has obtained prior written authorization from the former employers or other persons. Employee hereby covenants that Employee shall not breach any obligation of confidentiality or duty that Employee may have to former employers or other persons.

5. SUCCESSORS; BINDING AGREEMENT.

5.1 Successors of the Company. The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, by agreement in form and substance satisfactory to Employee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. Failure of the Company to obtain such agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle Employee to compensation from the Company in the same amount and on the same terms as Employee would be entitled hereunder if Employee terminated his employment for Good Reason, except that for purposes or implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Date of Termination. As used in this Agreement, "Company" shall mean the company as hereinbefore defined and any successor to its business and/or assets as aforesaid which executes and delivers the agreement provided for in this Section 5 or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of law.

6. NOTICE. For the purposes of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered or certified mail, return receipt requested, postage prepaid, addressed to the respective addresses set forth on the first page of this Agreement, provided that all notices to the Company shall be directed to the attention of the Chairman of the Board of the Company with a copy to the Secretary of the Company, except that notices of change of address shall be effective only upon receipt.

7. MISCELLANEOUS. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing signed by Employee and such officer as may be specifically designated by the Board of Directors of the Company. No waiver by either party hereto at

any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement.

8. VALIDITY. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

9. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

10. GOVERNING LAW. This Agreement shall be governed by and construed under the laws of the State of Texas.

11. ARBITRATION. Except as contemplated by Section 4.4 hereof, any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration in Houston, Texas (in accordance with the rules of the American Arbitration Association then in effect). Notwithstanding the pendency of any such dispute or controversy, the Company will continue to pay Employee his full compensation in effect when the notice giving rise to the dispute was given and continue Employee as a participant in all compensation, benefit and insurance plans in which he was participating when the notice giving rise to the dispute was given, until the dispute is finally resolved. Amounts paid under this paragraph are in addition to all other amounts due under this Agreement and shall not be offset against or reduce any other amounts due under this Agreement. Judgment may be entered on the arbitrator's award in any court having jurisdiction; provided, however, that Employee shall be entitled to seek specific performance of his right to be paid until the Date of Termination during the pendency of any dispute or controversy arising under or in connection with this Agreement.

12. CAPTIONS AND GENDER. The use of captions and Section headings herein is for the purpose of convenience only and shall not affect the interpretation or substance of any provision contained herein. Similarly, the use of the masculine gender with respect to pronouns in this Agreement is for the purpose of convenience and includes either sex who may be a signatory.

13. PRIOR AGREEMENTS. This Agreement supersedes all prior agreements entered into between the Company and Employee with regard to the subject matter set forth herein; provided, however, that this Agreement shall not supersede that letter agreement dated July 15, 1997, between the Company and Employee, which shall continue in full force and effect as to the matters covered thereby and for the period contemplated thereby.

IN WITNESS WHEREOF, the parties hereof have signed this Agreement as of the 31st day of July 1997.

OYO GEOSPACE CORPORATION

By   /s/ ERNEST M. HALL
  -------------------------------------

Name  Ernest M. Hall, Jr.
    -----------------------------------

(EMPLOYEE)

  /s/ MICHAEL J. SHEEN
---------------------------------------

                                                                                  Section
                                                                                  -------
ARTICLE I - PLAN

                 Purpose  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1
                 Effective Date of Plan . . . . . . . . . . . . . . . . . . . . . . . 1.2

ARTICLE II - DEFINITIONS

                 Affiliate  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1
                 Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . 2.2
                 Change of Control  . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
                 Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
                 Committee  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
                 Company  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.6
                 Disinterested Person . . . . . . . . . . . . . . . . . . . . . . . . 2.7
                 Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.8
                 Fair Market Value  . . . . . . . . . . . . . . . . . . . . . . . . . 2.9
                 Incentive Option . . . . . . . . . . . . . . . . . . . . . . . . .  2.10
                 Nonqualified Option  . . . . . . . . . . . . . . . . . . . . . . .  2.11
                 Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2.12
                 Option Agreement . . . . . . . . . . . . . . . . . . . . . . . . .  2.13
                 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2.14
                 Restricted Stock . . . . . . . . . . . . . . . . . . . . . . . . .  2.15
                 Restricted Stock Agreement . . . . . . . . . . . . . . . . . . . .  2.16
                 Restricted Stock Purchase Price  . . . . . . . . . . . . . . . . .  2.17
                 Stock  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2.18
                 Stock Award  . . . . . . . . . . . . . . . . . . . . . . . . . . .  2.19
                 Voting Stock . . . . . . . . . . . . . . . . . . . . . . . . . . .  2.20
                 10% Stockholder  . . . . . . . . . . . . . . . . . . . . . . . . .  2.21

ARTICLE III - ELIGIBILITY

ARTICLE IV - GENERAL PROVISIONS RELATING TO OPTIONS AND STOCK AWARDS

                 Authority to Grant Options and Stock Awards  . . . . . . . . . . . . 4.1
                 Dedicated Shares . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2
                 Non-Transferability  . . . . . . . . . . . . . . . . . . . . . . . . 4.3
                 Requirements of Law  . . . . . . . . . . . . . . . . . . . . . . . . 4.4
                 Changes in the Company's Capital Structure . . . . . . . . . . . . . 4.5
                 Election Under Section 83(b) of the Code . . . . . . . . . . . . . . 4.6

ARTICLE V - OPTIONS

                 Type of Option . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.1
                 Option Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2
                 Duration of Options  . . . . . . . . . . . . . . . . . . . . . . . . 5.3
                 Amount Exercisable . . . . . . . . . . . . . . . . . . . . . . . . . 5.4
                 Exercise of Options  . . . . . . . . . . . . . . . . . . . . . . . . 5.5
                 Exercise on Termination of Employment  . . . . . . . . . . . . . . . 5.6
                 Substitution Options . . . . . . . . . . . . . . . . . . . . . . . . 5.7
                 No Rights as Stockholder . . . . . . . . . . . . . . . . . . . . . . 5.8

ARTICLE VI - STOCK AWARDS

                 Stock Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1
                 Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2
                 Stock Certificate  . . . . . . . . . . . . . . . . . . . . . . . . . 6.3
                 Rights as Stockholder  . . . . . . . . . . . . . . . . . . . . . . . 6.4
                 Lapse of Restrictions  . . . . . . . . . . . . . . . . . . . . . . . 6.5
                 Restriction Period . . . . . . . . . . . . . . . . . . . . . . . . . 6.6

ARTICLE VII - ADMINISTRATION

ARTICLE VIII - AMENDMENT OR TERMINATION OF PLAN

ARTICLE IX - MISCELLANEOUS

                 No Establishment of a Trust Fund . . . . . . . . . . . . . . . . . . 9.1
                 No Employment Obligation . . . . . . . . . . . . . . . . . . . . . . 9.2
                 Forfeiture   . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.3
                 Tax Withholding  . . . . . . . . . . . . . . . . . . . . . . . . . . 9.4
                 Written Agreement  . . . . . . . . . . . . . . . . . . . . . . . . . 9.5
                 Indemnification of the Committee and the
                          Board of Directors  . . . . . . . . . . . . . . . . . . . . 9.6
                 Gender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.7
                 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.8
                 Other Compensation Plans . . . . . . . . . . . . . . . . . . . . . . 9.9
                 Other Options or Awards  . . . . . . . . . . . . . . . . . . . . .  9.10
                 Governing Law  . . . . . . . . . . . . . . . . . . . . . . . . . .  9.11

ARTICLE I

PLAN

1.1 PURPOSE. This Plan is a plan for key employees (including officers and employee directors) of the Company and its Affiliates and is intended to advance the best interests of the Company, its Affiliates, and its stockholders by providing those persons who have substantial responsibility for the management and growth of the Company and its Affiliates with additional incentives and an opportunity to obtain or increase their proprietary interest in the Company, thereby encouraging them to continue in the employ of the Company or any of its Affiliates.

1.2 EFFECTIVE DATE OF PLAN. The Plan is effective November 15, 1997, if within one year of that date it shall have been approved by at least a majority vote of stockholders voting in person or by proxy at a duly held stockholders' meeting, or if the provisions of the corporate charter, by-laws or applicable state law prescribes a greater degree of stockholder approval for this action, the approval by the holders of that percentage, at a duly held meeting of stockholders. No Incentive Option, Nonqualified Option, or Stock Award shall be granted pursuant to the Plan after November 14, 2007.

ARTICLE II

DEFINITIONS

The words and phrases defined in this Article shall have the meaning set out in these definitions throughout this Plan.

2.1 "AFFILIATE" means any parent corporation and any subsidiary corporation. The term "parent corporation" means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company if, at the time of the action or transaction, each of the corporations other than the Company owns stock possessing more than 50% of the total combined voting power of all classes of stock in one of the other corporations in the chain. The term "subsidiary corporation" means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if, at the time of the action or transaction, each of the corporations other than the last corporation in the unbroken chain owns stock possessing more than 50% of the total combined voting power of all classes of stock in one of the other corporations in the chain.

              2.2         "BOARD OF DIRECTORS" means the board of directors of
the Company.

              2.3         "CHANGE OF CONTROL" means the occurrence of one or

more of the following events:

(a) Any "person" (other than the Company or a subsidiary thereof or any employee benefit plan thereof or OYO Corporation (Japan) or OYO Corporation U.S.A.), including a "syndicate" or "group" as those

terms are used in Section 13(d) of the Securities Exchange Act of 1934 (the"Exchange Act"), is or becomes the "beneficial owner" (as that term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 20% or more of the combined voting power of the Company's then outstanding Voting Stock;

(b) The Company is merged or consolidated or combined in any other manner with another corporation or entity and immediately after giving effect to the merger or consolidation either (i) less than 80% of the outstanding Voting Stock of the surviving or resulting entity are then beneficially owned in the aggregate by (x) the stockholders of the Company immediately prior to such merger or consolidation, or (y) if a record date has been set to determine the stockholders of the Company entitled to vote on such merger or consolidation, the stockholders of the Company as of such record date, or (ii) the Board of Directors, or similar governing body, of the surviving or resulting entity does not have as a majority of its members the persons specified in clause (c)(a) and (b) below;

(c) If at any time the following do not constitute a majority of the Board of Directors of the Company (or any successor entity referred to in clause (b) above):

a. persons who are directors of the Company on November 15, 1997; and

b. persons who, prior to their election as directors of the Company (or successor entity if applicable) were nominated, recommended or endorsed by a formal resolution of the Board of Directors of the Company;

(d) If at any time during a calendar year a majority of the directors of the Company are not persons who were directors at the beginning of the calendar year;

(e) the Company transfers (whether by sale, lease, exchange or otherwise) substantially all of its assets to another corporation which is a less than 80%-owned, direct or indirect, subsidiary of the Company; or

(f) the Company shall adopt or undertake any plan of liquidation or dissolution.

              2.4         "CODE" means the Internal Revenue Code of 1986, as
amended.

              2.5         "COMMITTEE" means the Compensation Committee of the

Board of Directors, such other committee of two or more individuals, as designated by the Board of Directors. The Committee shall be comprised (a) solely of at least two members who are Disinterested Persons or (b) of the entire Board of Directors.

              2.6         "COMPANY" means OYO Geospace Corporation, a Delaware
corporation.

              2.7         "DISINTERESTED PERSON" means a "disinterested person"

as that term is defined in Rule 16b-3 under the Exchange Act.

2.8 "EMPLOYEE" means a person employed by the Company or any Affiliate to whom an Option or a Stock Award is granted.

2.9 "FAIR MARKET VALUE" of the Stock as of any date means
(a) the closing price of the Stock on that date on the principal securities exchange on which the Stock is listed; or (b) if the Stock is not listed on a securities exchange, the average of the high and low sale prices of the Stock on that date as reported on the NASDAQ National Market System; or (c) if the Stock is not listed on the NASDAQ National Market System, the average of the high and low bid quotations for the Stock on that date as reported by the National Quotation Bureau Incorporated; or (d) if none of the foregoing is applicable, an amount at the election of the Committee equal to (x) the average between the closing bid and ask prices per share of stock on the last preceding date on which those prices were reported or (y) that amount as determined by the Committee.

2.10 "INCENTIVE OPTION" means an option granted under this Plan which is designated as an "Incentive Option" and satisfies the requirements of Section 422 of the Code.

2.11 "NONQUALIFIED OPTION" means an option granted under this Plan other than an Incentive Option.

2.12 "OPTION" means both an Incentive Option and a Nonqualified Option granted under this Plan to purchase shares of Stock.

2.13 "OPTION AGREEMENT" means the written agreement which sets out the terms of an Option.

2.14 "PLAN" means the OYO Geospace Corporation 1997 Key Employee Stock Option Plan, as set out in this document and as it may be amended from time to time.

2.15 "RESTRICTED STOCK" means stock awarded or purchased under a Restricted Stock Agreement entered into pursuant to this Plan, together with (i) all rights, warranties or similar items attached or accruing thereto or represented by the certificate representing the stock and (ii) any stock or securities into which or for which the stock is thereafter converted or exchanged. The terms and conditions of the Restricted Stock Agreement shall be determined by the Committee consistent with the terms of the Plan.

2.16 "RESTRICTED STOCK AGREEMENT" means an agreement between the Company or any Affiliate and the Employee pursuant to which the Employee receives a Stock Award subject to Article VI.

2.17 "RESTRICTED STOCK PURCHASE PRICE" means the purchase price, if any, per share of Restricted Stock subject to an Award. The Restricted Stock Purchase Price shall be determined by the Committee. It may be greater than or less than the Fair Market Value of the Stock on the date of the Stock Award.

2.18 "STOCK" means the common stock of the Company, $.01 par value or, in the event that the outstanding shares of common stock are later changed into or exchanged for a different class of stock or securities of the Company or another corporation, that other stock or security.

2.19 "STOCK AWARD" means an award of Restricted Stock.

2.20 "VOTING STOCK" means shares of capital stock of the Company the holders of which are entitled to vote for the election of directors of the Company, but excluding shares entitled to so vote only upon the occurrence of a contingency unless that contingency shall have occurred.

2.21 "10% STOCKHOLDER" means an individual who, at the time an Incentive Option is granted, owns stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or of any Affiliate. An individual shall be considered as owning the stock owned, directly or indirectly, by or for his brothers and sisters (whether by the whole or half blood), spouse, ancestors, and lineal descendants; and stock owned, directly or indirectly, by or for a corporation, partnership, estate, or trust, shall be considered as being owned proportionately by or for its stockholders, partners, or beneficiaries.

ARTICLE III

ELIGIBILITY

The individuals who shall be eligible to receive Incentive Options, Nonqualified Options, and Stock Awards shall be those key employees of the Company or any of its Affiliates as the Committee shall determine from time to time. However, no member of the Committee shall be eligible to receive any Option or Stock Award or to receive stock, stock options, or stock appreciation rights under any other plan of the Company or any of its Affiliates, if to do so would cause the individual not to be a Disinterested Person. The Board of Directors may designate one or more individuals who shall not be eligible to receive any Option or Stock Award under this Plan or under other similar plans of the Company.

ARTICLE IV

GENERAL PROVISIONS RELATING TO OPTIONS AND STOCK AWARDS

4.1 AUTHORITY TO GRANT OPTIONS AND STOCK AWARDS. The Committee may grant to those key employees of the Company or any of its Affiliates as it shall from time to time determine, Options or Stock Awards under the terms and conditions of this Plan. Subject only to any applicable limitations set out in this Plan, the number of shares of Stock to be covered by any Option or Stock Award to be granted to an Employee shall be as determined by the Committee.

4.2 DEDICATED SHARES. The total number of shares of Stock with respect to which Options and Stock Awards may be granted under the Plan shall be 425,000. The shares may be treasury shares or authorized but unissued shares. The number of shares stated in this Section 4.2 shall be subject to adjustment in accordance with the provisions of Section 4.5.

In the event that any outstanding Option or Stock Award shall expire or terminate for any reason or any Option or Stock Award is surrendered, the shares of Stock allocable to the unexercised portion of that Option or Stock Award may again be subject to an Option or Stock Award under the Plan.

4.3 NON-TRANSFERABILITY. Options shall not be transferable by the Employee otherwise than by will or under the laws of descent and distribution, and shall be exercisable, during the Employee's lifetime, only by him. Restricted Stock shall be purchased by and/or become vested under a Restricted Stock Agreement during the Employee's lifetime, only by him. Any attempt to transfer a Stock Award other than under the terms of the Plan and the Restricted Stock Agreement shall terminate the Stock Award and all rights of the Employee to that Restricted Stock.

4.4 REQUIREMENTS OF LAW. The Company shall not be required to sell or issue any Stock under any Option or Stock Award if issuing that Stock would constitute or result in a violation by the Employee or the Company of any provision of any law, statute, or regulation of any governmental authority. Specifically, in connection with any applicable statute or regulation relating to the registration of securities, upon exercise of any Option or pursuant to any Stock Award, the Company shall not be required to issue any Stock unless the Committee has received evidence satisfactory to it to the effect that the holder of that Option or Stock Award will not transfer the Stock except in accordance with applicable law, including receipt of an opinion of counsel satisfactory to the Company to the effect that any proposed transfer complies with applicable law. The determination by the Committee on this matter shall be final, binding and conclusive. The Company may, but shall in no event be obligated to, register any Stock covered by this Plan pursuant to applicable securities laws of any country or any political subdivision. In the event the Stock issuable on exercise of an Option or pursuant to a Stock Award is not registered, the Company may imprint on the certificate evidencing the Stock any legend that counsel for the Company considers necessary or advisable to comply with applicable law. The Company shall not be obligated to take any other affirmative action in order to cause the exercise of an

Option or vesting under a Stock Award, or the issuance of shares under either of them, to comply with any law or regulation of any governmental authority.

4.5 CHANGES IN THE COMPANY'S CAPITAL STRUCTURE. The existence of outstanding Options or Stock Awards shall not affect in any way the right or power of the Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company's capital structure or its business, or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the Stock or its rights, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

If the Company shall effect a subdivision or consolidation of shares or other capital readjustment, the payment of a stock dividend, or other increase or reduction of the number of shares of the Stock outstanding, without receiving compensation for it in money, services or property, then (a) the number, class, and per share price of shares of Stock subject to outstanding Options under this Plan shall be appropriately adjusted in such a manner as to entitle an Employee to receive upon exercise of an Option, for the same aggregate cash consideration, the equivalent total number and class of shares he would have received had he exercised his Option in full immediately prior to the event requiring the adjustment; and (b) the number and class of shares of Stock then reserved to be issued under the Plan shall be adjusted by substituting for the total number and class of shares of Stock then reserved, that number and class of shares of Stock that would have been received by the owner of an equal number of outstanding shares of each class of Stock as the result of the event requiring the adjustment.

If the Company is merged or consolidated with another corporation, and the Company is not the surviving corporation, or if the Company is liquidated or sells or otherwise disposes of substantially all its assets while unexercised Options remain outstanding under this Plan, (a) subject to the provisions of clause (c) below, after the effective date of the merger, consolidation, liquidation, sale or other disposition, as the case may be, each holder of an outstanding Option shall be entitled, upon exercise of the Option, to receive, in lieu of shares of Stock, the number and class or classes of shares of stock or other securities or property to which the holder would have been entitled if, immediately prior to the merger, consolidation, liquidation, sale or other disposition, the holder had been the holder of record of a number of shares of Stock equal to the number of shares as to which the Option shall be so exercised; (b) the Board of Directors may waive any limitations set out in or imposed under this Plan so that all Options, from and after a date prior to the effective date of the merger, consolidation, liquidation, sale or other disposition, as the case may be, specified by the Board of Directors, shall be exercisable in full; and (c) all outstanding Options may be canceled by the Board of Directors as of the effective date of any merger, consolidation, liquidation, sale or other disposition, if (i) notice of cancellation shall be given to each holder of an Option and (ii) each holder of an Option shall have the right to exercise that Option in full (without regard to any limitations set out in or imposed under this Plan or the Option Agreement granting that Option) during a period set by the Board of Directors preceding the effective date of the merger, consolidation, liquidation, sale

or other disposition and, if in the event all outstanding Options may not be exercised in full under applicable securities laws without registration of the shares of Stock issuable on exercise of the Options, the Board of Directors may limit the exercise of the Options to the number of shares of Stock, if any, as may be issued without registration. The method of choosing which Options may be exercised, and the number of shares of Stock for which Options may be exercised, shall be solely within the discretion of the Board of Directors.

After a merger of one or more corporations into the Company or after a consolidation of the Company and one or more corporations in which the Company shall be the surviving corporation, each Employee shall be entitled to have his Restricted Stock appropriately adjusted based on the manner the Stock was adjusted under the terms of the agreement of merger or consolidation.

The issue by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services either upon direct sale or upon the exercise of rights or warrants to subscribe for them, or upon conversion of shares or obligations of the Company convertible into shares or other securities, shall not affect, and no adjustment by reason of such issuance shall be made with respect to, the number, class, or price of shares of Stock then subject to outstanding Options or Stock Awards.

4.6 ELECTION UNDER SECTION 83(B) OF THE CODE. No Employee shall exercise the election permitted under Section 83(b) of the Code without written approval of the Committee. Any Employee doing so shall forfeit all Options and/or Stock Awards issued to him under this Plan.

ARTICLE V

OPTIONS

5.1 TYPE OF OPTION. The Committee shall specify whether a given option shall constitute an Incentive Option or a Nonqualified Option.

5.2 OPTION PRICE. The price at which Stock may be purchased under an Incentive Option shall not be less than the greater of: (a) 100% of the Fair Market Value of the shares of Stock on the date the Option is granted or (b) the aggregate par value of the shares of Stock on the date the Option is granted. The Committee in its discretion may provide that the price at which shares of Stock may be purchased under an Incentive Option shall be more than 100% of Fair Market Value. In the case of any 10% Stockholder, the price at which shares of Stock may be purchased under an Incentive Option shall not be less than 110% of the Fair Market Value of the Stock on the date the Incentive Option is granted.

The price at which shares of Stock may be purchased under a Nonqualified Option shall not be less than the greater of: (a) 100% of the Fair Market Value of the shares of Stock on the date the Option is granted or (b) the aggregate par value of the shares of Stock on the date the Option is granted. The Committee in its discretion may

provide that the price at which shares of Stock may be purchased under a Nonqualified Option shall be more than 100% of Fair Market Value.

5.3 DURATION OF OPTIONS. No Option shall be exercisable after the expiration of 10 years from the date the Option is granted. In the case of a 10% Stockholder, no Incentive Option shall be exercisable after the expiration of five years from the date the Incentive Option is granted.

5.4 AMOUNT EXERCISABLE. Each Option may be exercised from time to time, in whole or in part, in the manner and subject to the conditions the Committee, in its sole discretion, may provide in the Option Agreement, as long as the Option is valid and outstanding, provided that no Option may be exercisable within six (6) months of the date of grant. Unless provided otherwise in the Option Agreement, 25% of the shares of Stock in an Option shall become exercisable on the first anniversary of the date of grant, and an additional 25% shall become exercisable on each of the next three anniversary dates. Notwithstanding any other provisions of this Plan, in the event of a Change of Control, each Option shall become immediately exercisable in full.

INCENTIVE OPTION. To the extent that the aggregate Fair Market Value (determined as of the time an Incentive Option is granted) of the Stock with respect to which Incentive Options first become exercisable by the Optionee during any calendar year (under this Plan and any other incentive stock option plan(s) of the Company or any Affiliate) exceeds $100,000, the Incentive Options shall be treated as Nonqualified Options. In making this determination, Incentive Options and such other incentive stock options shall be taken into account in the order in which they were granted.

5.5 EXERCISE OF OPTIONS. Each Option shall be exercised by the delivery of written notice to the Committee setting forth the number of shares of Stock with respect to which the Option is to be exercised, together with: (a) cash, check, bank draft, or postal or express money order payable to the order of the Company for an amount equal to the option price of the shares,
(b) Stock at its Fair Market Value on the date of exercise, and/or (c) any other form of payment which is acceptable to the Committee, and specifying the address to which the certificates for the shares are to be mailed. As promptly as practicable after receipt of written notification and payment, the Company shall deliver to the Employee certificates for the number of shares with respect to which the Option has been exercised, issued in the Employee's name. If shares of Stock are used in payment, the aggregate Fair Market Value of the shares of Stock tendered must be equal to or less than the aggregate exercise price of the shares being purchased upon exercise of the Option, and any difference must be paid by cash, check, bank draft, or postal or express money order payable to the order of the Company. Delivery of the shares shall be deemed effected for all purposes when a stock transfer agent of the Company shall have deposited the certificates in the United States mail, addressed to the Employee, at the address specified by the Employee.

Whenever an Option is exercised by exchanging shares of Stock owned by the Employee, the Employee shall deliver to the Company certificates registered in the name of the Employee representing a number of shares of Stock legally and beneficially owned by the Employee, free of all liens, claims, and encumbrances of every kind,

accompanied by stock powers duly endorsed in blank by the record holder of the shares represented by the certificates (with signature guaranteed by a commercial bank or trust company or by a brokerage firm having a membership on a registered national stock exchange). The delivery of certificates upon the exercise of Options is subject to the condition that the person exercising the Option provide the Company with the information the Company might reasonably request pertaining to exercise, sale or other disposition.

5.6 EXERCISE ON TERMINATION OF EMPLOYMENT. Unless it is expressly provided otherwise in the Option Agreement, Options shall terminate one day less than three months after severance of employment of the Employee from the Company and all Affiliates for any reason, with or without cause, other than death or retirement or disability under the then established rules of the Company. Whether authorized leave of absence or absence on military or government service shall constitute severance of the employment of the Employee shall be determined by the Committee at that time.

In determining the employment relationship between the Company and the Employee, employment by any Affiliate shall be considered employment by the Company, as shall employment by a corporation issuing or assuming a stock option in a transaction to which Section 424(a) of the Code applies, or by a parent corporation or subsidiary corporation of the corporation issuing or assuming a stock option (and for this purpose, the phrase "corporation issuing or assuming a stock option" shall be substituted for the word "Company" in the definitions of parent corporation and subsidiary corporation in Section 2.1, and the parent-subsidiary relationship shall be determined at the time of the corporate action described in Section 424(a) of the Code).

DEATH. If, before the expiration of an Option, the Employee, whether in the employ of the Company or after he has retired or was severed for disability, dies, the Option shall continue until the earlier of the Option's expiration date or one year following the date of his death, unless it is expressly provided otherwise in the Option Agreement. After the death of the Employee, his executors, administrators or any persons to whom his Option may be transferred by will or by the laws of descent and distribution shall have the right, at any time prior to the Option's expiration or termination, whichever is earlier, to exercise it, to the extent to which he was entitled to exercise it immediately prior to his death, unless it is expressly provided otherwise in the Option Agreement.

RETIREMENT. If, before the expiration of an Incentive Option, the Employee shall be retired in good standing from the employ of the Company under the then established rules of the Company, the Incentive Option shall terminate on the earlier of the Option's expiration date or one year after his retirement. An Incentive Option may become a Nonqualified Option if exercised more than three months after termination of employment.

Unless it is expressly provided otherwise in the Option Agreement, if before the expiration of a Nonqualified Option, the Employee shall be retired in good standing from the employ of the Company under the then established rules of the Company, the Nonqualified Option shall terminate on the earlier of the Nonqualified Option's expiration date or one year after his retirement. In the event of retirement,

the Employee shall have the right prior to the expiration or termination of the Nonqualified Option to exercise the Nonqualified Option, to the extent to which he was entitled to exercise it immediately prior to his retirement, unless it is expressly provided otherwise in the Option Agreement.

DISABILITY. If, before the expiration of an Option, the Employee shall be severed from the employ of the Company for disability, the Option shall terminate on the earlier of the Option's expiration date or one day less than one year after the date he was severed because of disability, unless it is expressly provided otherwise in the Option Agreement. In the event that the Employee shall be severed from the employ of the Company for disability, the Employee shall have the right prior to the termination of the Option to exercise the Option, to the extent to which he was entitled to exercise it immediately prior to his severance of employment for disability, unless it is expressly provided otherwise in the Option Agreement.

5.7 SUBSTITUTION OPTIONS. Options may be granted under this Plan from time to time in substitution for stock options held by employees of other corporations who are about to become employees of or affiliated with the Company or any Affiliate as the result of a merger or consolidation of the employing corporation with the Company or any Affiliate, or the acquisition by the Company or any Affiliate of the assets of the employing corporation, or the acquisition by the Company or any Affiliate of stock of the employing corporation as the result of which it becomes an Affiliate of the Company. The terms and conditions of the substitute Options granted may vary from the terms and conditions set out in this Plan to the extent the Committee, at the time of grant, may deem appropriate to conform, in whole or in part, to the provisions of the stock options in substitution for which they are granted.

5.8 NO RIGHTS AS STOCKHOLDER. No Employee shall have any rights as a stockholder with respect to Stock covered by his Option until the date a stock certificate is issued for the Stock.

ARTICLE VI

STOCK AWARDS

6.1 STOCK AWARDS. The Committee may issue shares of Stock to an eligible employee subject to the terms of a Restricted Stock Agreement. The Restricted Stock may be issued for no payment by the Employee or for a payment below the Fair Market Value on the date of grant. Restricted Stock shall be subject to restrictions as to sale, transfer, alienation, pledge or other encumbrance and generally will be subject to vesting over a period of time specified in the Restricted Stock Agreement. The Committee shall determine the period of vesting, the number of shares, the price, if any, of Stock included in a Stock Award, and the other terms and provisions which are included in a Restricted Stock Agreement. Notwithstanding any other provisions of the Plan, in the event of a Change of Control, each Stock Award shall become immediately vested.

6.2 RESTRICTIONS. Restricted Stock shall be subject to the following terms and conditions as determined by the Committee, including without limitation any or all of the following:

(a) a prohibition against the sale, transfer, alienation, pledge or other encumbrance of the shares of Restricted Stock, such prohibition to lapse (i) at such time or times as the Committee shall determine (whether in annual or more frequent installments, at the time of the death, disability or retirement of the holder of such shares, or otherwise);

(b) a requirement that the holder of shares of Restricted Stock forfeit, or in the case of shares sold to an Employee, resell back to the Company at his cost, all or a part of such shares in the event of termination of the holder's employment during any period in which the shares remain subject to restrictions;

(c) a prohibition against employment of the holder of Restricted Stock by any competitor of the Company or its Affiliates, or against such holder's dissemination of any secret or confidential information belonging to the Company or an Affiliate; and

(d) unless stated otherwise in the Restricted Stock Agreement, (i) if restrictions remain at the time of severance of employment with the Company and all Affiliates, other than for reason of disability or death, the Restricted Stock shall be forfeited; and (ii) if severance of employment is by reason of disability or death, the restrictions on the shares shall lapse and the Employee or his heirs or estate shall be 100% vested in the shares subject to the Restricted Stock Agreement.

6.3 STOCK CERTIFICATE. Shares of Restricted Stock shall be registered in the name of the Employee receiving the Stock Award and deposited, together with a stock power endorsed in blank, with the Company. Each such certificate shall bear a legend in substantially the following form:

The transferability of this certificate and the shares of Stock represented by it is restricted by and subject to the terms and conditions (including conditions of forfeiture) contained in the OYO Geospace Corporation 1997 Key Employee Stock Option Plan, and an agreement entered into between the registered owner and the Company. A copy of the Plan and agreement is on file in the office of the Secretary of the Company.

6.4 RIGHTS AS STOCKHOLDER. Subject to the terms and conditions of the Plan, each Employee receiving a certificate for Restricted Stock shall have all the rights of a stockholder with respect to the shares of Stock included in the Stock Award during any period in which such shares are subject to forfeiture and restrictions on transfer, including without limitation, the right to vote such shares. Dividends paid with respect to shares of Restricted Stock in cash or property other than stock in the Company or rights to acquire stock in the Company shall be paid to the Employee currently. Dividends paid in stock in the Company or rights to acquire stock in the Company shall be added to and become a part of the Restricted Stock.

6.5 LAPSE OF RESTRICTIONS. At the end of the time period during which any shares of Restricted Stock are subject to forfeiture and restrictions on sale, transfer, alienation, pledge, or other encumbrance, such shares shall vest and will be delivered in a certificate, free of all restrictions, to the Employee or to the Employee's legal representative, beneficiary or heir; provided the certificate shall bear such legend, if any, as the Committee determines is reasonably required by applicable law.

By accepting a Stock Award and executing a Restricted Stock Agreement, the Employee agrees to remit when due any federal and state income and employment taxes required to be withheld or to satisfy this obligation in a manner acceptable to the Committee.

6.6 RESTRICTION PERIOD. No Stock Award may provide for restrictions continuing beyond 10 years from the date of the Stock Award.

ARTICLE VII

ADMINISTRATION

The Plan shall be administered by the Committee. All questions of interpretation and application of the Plan, Options or Stock Awards shall be subject to the determination of the Committee. A majority of the members of the Committee shall constitute a quorum. All determinations of the Committee shall be made by a majority of its members. Any decision or determination reduced to writing and signed and dated by all of the members shall be as effective as if it had been made by a majority vote at a meeting properly called and held. This Plan shall be administered in such a manner as to permit the Options granted under it which are designated to be Incentive Options to qualify as Incentive Options. In carrying out its authority under this Plan, the Committee shall have full and final authority and discretion, including but not limited to the following rights, powers and authorities, to:

(a) determine the Employees to whom and the time or times at which Options or Stock Awards will be made,

(b) determine the number of shares and the purchase price of Stock covered in each Option or Stock Award, subject to the terms of the Plan,

(c) determine the terms, provisions and conditions of each Option and Stock Award, which need not be identical,

(d) accelerate the time at which any outstanding Option may be exercised,

(e) define the effect, if any, on an Option or Stock Award of the death, disability, retirement, or termination of employment of the Employee,

(f) prescribe, amend and rescind rules and regulations relating to administration of the Plan, and

(g) make all other determinations and take all other actions deemed necessary, appropriate, or advisable for the proper administration of the Plan.

The actions of the Committee in exercising all of the rights, powers, and authorities set out in this Article and all other Articles of this Plan, when performed in good faith and in its sole judgment, shall be final, conclusive and binding on all parties.

ARTICLE VIII

AMENDMENT OR TERMINATION OF PLAN

The Board of Directors of the Company may amend, terminate or suspend this Plan at any time, in its sole and absolute discretion; provided, however, that, to the extent required to qualify this Plan under Rule 16b-3 promulgated under Section 16 of the Exchange Act, no amendment that would (a) materially increase the number of shares of Stock that may be issued under this Plan, (b) materially modify the requirements as to eligibility for participation in this Plan, or (c) otherwise materially increase the benefits accruing to participants under this Plan, shall be made without the approval of the Company's stockholders; provided further, however, that, to the extent required to maintain the status of any Incentive Option under the Code, no amendment that would (a) change the aggregate number of shares of Stock which may be issued under Incentive Options, (b) change the class of employees eligible to receive Incentive Options, or (c) decrease the Option price for Incentive Options below the Fair Market Value of the Stock at the time it is granted, shall be made without the approval of the Company's stockholders. Subject to the preceding sentence, the Board shall have the power to make any changes in the Plan and in the regulations and administrative provisions under it or in any outstanding Incentive Option as in the opinion of counsel for the Company may be necessary or appropriate from time to time to enable any Incentive Option granted under this Plan to continue to qualify as an incentive stock option or such other stock option as may be defined under the Code so as to receive preferential federal income tax treatment.

ARTICLE IX

MISCELLANEOUS

9.1 NO ESTABLISHMENT OF A TRUST FUND. No property shall be set aside nor shall a trust fund of any kind be established to secure the rights of any Employee under this Plan. All Employees shall at all times rely solely upon the general credit of the Company for the payment of any benefit which becomes payable under this Plan.

9.2 NO EMPLOYMENT OBLIGATION. The granting of any Option or Stock Award shall not constitute an employment contract, express or implied, nor impose upon the Company or any Affiliate any obligation to employ or continue to employ any Employee. The right of the Company or any Affiliate to terminate the employment of any person shall not be diminished or affected by reason of the fact that an Option or Stock Award has been granted to him.

9.3 FORFEITURE. Notwithstanding any other provisions of this Plan, if the Committee finds by a majority vote after full consideration of the facts that the Employee, before or after termination of his employment with the Company or an Affiliate for any reason (a) committed or engaged in fraud, embezzlement, theft, commission of a felony, or proven dishonesty in the course of his employment by the Company or an Affiliate, which conduct damaged the Company or Affiliate, or disclosed trade secrets of the Company or an Affiliate, or (b) participated, engaged in or had a material, financial or other interest, whether as an employee, officer, director, consultant, contractor, stockholder, owner, or otherwise, in any commercial endeavor in the United States which is competitive with the business of the Company or an Affiliate without the written consent of the Company or Affiliate, the Employee shall forfeit all outstanding Options and all outstanding Restricted Stock, and including all exercised Options and other situations pursuant to which the Company has not yet delivered a stock certificate. Clause (b) shall not be deemed to have been violated solely by reason of the Employee's ownership of stock or securities of any publicly traded corporation, if that ownership does not result in effective control of the corporation.

The decision of the Committee as to the cause of the Employee's discharge, the damage done to the Company or an Affiliate, and the extent of the Employee's competitive activity shall be final. No decision of the Committee, however, shall affect the finality of the discharge of the Employee by the Company or an Affiliate in any manner.

9.4 TAX WITHHOLDING. The Company or any Affiliate shall be entitled to deduct from other compensation payable to each Employee any sums required by federal, state, or local tax law to be withheld with respect to the grant or exercise of an Option or lapse of restrictions on Restricted Stock. In the alternative, the Company may require the Employee (or other person exercising the Option or receiving the Restricted Stock) to pay the sum directly to the employer corporation. If the Employee (or other person exercising the Option or receiving the Restricted Stock) is required to pay the sum directly, payment in cash or by check of such sums for taxes shall be delivered within 10 days after the date of exercise or lapse of restrictions. The Company

shall have no obligation upon exercise of any Option or lapse of restrictions on Restricted Stock until payment has been received, unless withholding (or offset against a cash payment) as of or prior to the date of exercise or lapse of restrictions is sufficient to cover all sums due with respect to that exercise. The Company and its Affiliates shall not be obligated to advise an Employee of the existence of the tax or the amount which the employer corporation will be required to withhold.

9.5 WRITTEN AGREEMENT. Each Option and Stock Award shall be embodied in a written Option Agreement or Restricted Stock Agreement which shall be subject to the terms and conditions of this Plan and shall be signed
(i) by the Employee and (ii) by a member of the Committee on behalf of the Committee and the Company, or by an executive officer of the Company other than the Employee on behalf of the Company. The Option Agreement or Restricted Stock Agreement may contain any other provisions that the Committee in its discretion shall deem advisable which are not inconsistent with the terms of this Plan.

9.6 INDEMNIFICATION OF THE COMMITTEE AND THE BOARD OF DIRECTORS. With respect to administration of this Plan, the Company shall indemnify each present and future member of the Committee and the Board of Directors against, and each member of the Committee and the Board of Directors shall be entitled without further act on his part to indemnity from the Company for, all expenses (including attorney's fees, the amount of judgments and the amount of approved settlements made with a view to the curtailment of costs of litigation, other than amounts paid to the Company itself) reasonably incurred by him in connection with or arising out of any action, suit, or proceeding in which he may be involved by reason of his being or having been a member of the Committee and/or the Board of Directors, whether or not he continues to be a member of the Committee and/or the Board of Directors at the time of incurring the expenses -- including, without limitation, matters as to which he shall be finally adjudged in any action, suit or proceeding to have been found to have been negligent in the performance of his duty as a member of the Committee or the Board of Directors. However, this indemnity shall not include any expenses incurred by any member of the Committee and/or the Board of Directors in respect of matters as to which he shall be finally adjudged in any action, suit or proceeding to have been guilty of gross negligence or willful misconduct in the performance of his duty as a member of the Committee and the Board of Directors, or in respect of any matter in which any settlement is effected, to an amount in excess of the amount approved by the Company on the advice of its legal counsel. In addition, no right of indemnification under this Plan shall be available to or enforceable by any member of the Committee and the Board of Directors unless, within 60 days after institution of any action, suit or proceeding, he shall have offered the Company, in writing, the opportunity to handle and defend same at its own expense. This right of indemnification shall inure to the benefit of the heirs, executors or administrators of each member of the Committee and the Board of Directors and shall be in addition to all other rights to which a member of the Committee and the Board of Directors may be entitled as a matter of law, contract, or otherwise.

9.7 GENDER. If the context requires, words of one gender when used in this Plan shall include the others and words used in the singular or plural shall include the other.

9.8 HEADINGS. Headings of Articles and Sections are included for convenience of reference only and do not constitute part of the Plan and shall not be used in construing the terms of the Plan.

9.9 OTHER COMPENSATION PLANS. The adoption of this Plan shall not affect any other stock option, incentive or other compensation or benefit plans in effect for the Company or any Affiliate, nor shall the Plan preclude the Company from establishing any other forms of incentive or other compensation for employees of the Company or any Affiliate.

9.10 OTHER OPTIONS OR AWARDS. The grant of an Option or Stock Award shall not confer upon the Employee the right to receive any future or other Options or Stock Awards under this Plan, whether or not Options or Stock Awards may be granted to similarly situated Employees, or the right to receive future Options or Stock Awards upon the same terms or conditions as previously granted.

9.11 GOVERNING LAW. The provisions of this Plan shall be construed, administered, and governed under the laws of the State of Texas.

EXHIBIT 10.5

PRINTHEAD PURCHASE AGREEMENT

BY AND BETWEEN

OYO GEOSPACE CORPORATION

AND

OYO CORPORATION

NOVEMBER 10, 1995

PRINTHEAD PURCHASE AGREEMENT

THIS PRINTHEAD PURCHASE AGREEMENT is made and entered into this 10th day of November, 1995, by and between OYO Geospace Corporation, a Delaware corporation ("Purchaser"), with its principal office located at 7334 N. Gessner Road, Houston, Texas 77040, and OYO Corporation, a company organized and existing under the laws of Japan ("Seller"), with its principal office located at Ichigaya Building, 2-6, Kudan-Kita 4-chome, Chiyoda-ku, Tokyo 102, Japan.

W I T N E S S E T H :

WHEREAS, Purchaser is in the business of designing and manufacturing instruments and equipment used in (i) the acquisition and processing of seismic data and (ii) certain other applications

WHEREAS, Seller is in the business of providing engineering and consulting services primarily for the investigation of the earth's subsurface; and

WHEREAS, Seller desires to resell certain printheads (i) suitable for incorporation into thermal plotters manufactured by Purchaser and (ii) acquired from the manufacturer thereof to Purchaser, and Purchaser desires to purchase printheads from Seller for use in Purchaser's line of thermal plotters;

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

ARTICLE 1
DEFINITIONS

1.1 Definitions. For the purposes of this Agreement, in addition to the terms defined elsewhere herein, the following terms shall have the following meanings:

(a) "Affiliate" means any Person that controls, is controlled by or is under common control with any other Person;

(b) "Agreement" means this Printhead Purchase Agreement, as the same may subsequently be amended, modified or supplemented in accordance with its terms;

(c) "Encumbrances" means any mortgage, pledge, lien, claim, encumbrance, charge or other security interest, option, defect or other right of any third Person of any nature whatsoever, other than inchoate mechanic's, materialmen's and similar liens arising in the ordinary course of business;

(d) "Manufacturer" means various Japanese corporations or U.S. Affiliates thereof that manufacture Products or any successor Person of any of such Persons that carries on the business of manufacturing the Product;

(e) "Party" means either Purchaser or Seller, and "Parties" means both Purchaser and Seller;

(f) "Person" means a natural person or any entity of any kind, including (without limitation) joint stock companies, corporations, partnerships, limited liability companies, governmental entities and any other entity organized or formed under the law of any jurisdiction; and

(g) "Product" means printheads manufactured on the date hereof by the Manufacturers or any improved or succeeding models of such printheads that are used by, or are useful to, Purchaser in its manufacture of thermal plotters.

1.2 Other Definitional Provisions.

(a) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall, unless a specific provision is expressly referenced, refer to this Agreement as a whole and not to any particular provision of this document, and Article references contained in this Agreement are references to the Articles in this Agreement, unless otherwise specified.

(b) All words used herein in the singular shall extend to and include the plural, and all words used herein in the plural shall extend to and include the singular.

(c) All words used in any gender shall extend to and include all genders.

ARTICLE 2
SALE AND PURCHASE

2.1 Sale and Purchase Obligations.

(a) Seller agrees to sell to Purchaser, and Purchaser agrees to purchase from Seller, all of Purchaser's requirements for the Product during the term of this Agreement and in accordance with the terms and provisions hereof.

(b) If Seller is unable to supply Purchaser with all of Purchaser's requirements for the Product within 30 days of receipt of an order from Purchaser, Purchaser may purchase the Products from another source or manufacture such Products itself. If the sum of (i) the number of Products held by Seller at the time it receives such order plus (ii) the number of Products that Seller is able to acquire through the exercise of reasonable commercial efforts during such 30-day period is insufficient to satisfy the requirements of Purchaser

and, to the extent applicable, Seller's other customers, Seller shall allocate its supply of Products first to fill Purchaser's requirements of the Product.

2.2 Orders and Deliveries. All orders, processing and deliveries of the Product shall be made in accordance with the following procedures unless otherwise agreed in writing by both Parties:

(a) An order may be placed at any time. Each order shall specify the type and quantity of the Product ordered, the type of packaging therefor, the requested delivery date, the destination of delivery and the method of delivery.

(b) All shipments of Product shall be F.O.B. Seller's shipping point.

(c) Seller shall maintain commercially reasonable insurance that insures the value of Products shipped to Purchaser. Solely for the purposes of this Article 2.2(c), the value of a Product shall be deemed to be the Purchase Price.

(d) Seller acknowledges that delivery on or before the date specified in Purchaser's order is essential and agrees to use its best efforts to meet such specified delivery date.

(e) Each order and purchase of the Product will be subject to the terms and conditions of this Agreement only, unless otherwise agreed in writing by both Parties.

2.3 Pricing and Payment.

(a) The purchase price payable by Purchaser for each unit of the Product (the "Purchase Price") shall be equal to (i) Seller's cost of purchasing one unit of the Product from the Manufacturer plus (ii) 10% of such per unit purchase cost.

(b) Seller shall provide Purchaser reasonable access to its books and records to allow Purchaser to confirm Seller's purchasing costs.

(c) Seller shall be responsible for the payment of all customs charges and taxes related to the sale and purchase of the Products.

(d) Seller shall send Purchaser an invoice within 30 days after the delivery of Products pursuant to any order setting forth the types and quantities of Products shipped by Seller to Purchaser during the previous month. Within 30 days after the receipt of such invoice, Purchaser shall remit payment for such Products to Seller. All payments shall be made in Japanese Yen.

2.4 Risk of Loss. The risk of loss from any casualty to the Products, regardless of the cause, shall be on Seller up to the time of receipt of the Products by

Purchaser at Purchaser's delivery destination and until Purchaser has completed any proper inspection without rejection of the Products.

2.5 Force Majeure. If any act or condition beyond the reasonable control of Purchaser or Seller prevents, restricts or interferes with the performance of this Agreement, and the Party then directly affected promptly gives notice to the other Party, the directly affected Party will be temporarily excused from performance to the extent of the prevention, restriction or interference. The affected Party must, however, use its reasonable effort to avoid or remove the causes of nonperformance and must continue performance with the utmost dispatch when the causes are removed. Causes beyond a Party's reasonable control include, without limitation, war, acts of God, hurricanes, tornadoes, typhoons, earthquakes, embargoes, export, shipping or remittance restrictions, cessations or interruptions for any reason in the manufacture, or sale to Seller, by Manufacturers of the Product, strikes, lockouts, accidents, fires, riot, delays or defaults caused by carriers, floods, governmental seizure, control or rationing or compliance with any law, ruling, order, regulation, requirement, or instruction of any national, federal, state, provincial or municipal government, or any department or agency thereof.

2.6 Indemnification. Seller agrees to defend, indemnify and hold harmless Purchaser, its affiliates and their respective directors, officers, employees, agents, successors and assigns from and against any and all claims, losses, damages, liabilities, reasonable counsel fees and costs incident thereto incurred by or asserted against Purchaser as a result of damage to the property of Purchaser or others, or personal injuries to or injuries resulting in the death of any person or persons, including directors, officers, employees and agents of Purchaser relating to the Products; provided, however, Seller shall not have any liability (whether direct or indirect, in contract, tort or otherwise) to Purchaser unless such claims, losses, damages, liabilities, counsel fees or costs are determined, in a final judgment by a court of competent jurisdiction (not subject to further appeal), to have resulted primarily and directly from the gross negligence or willful misconduct of Seller or its directors, officers, employees or agents.

2.7 Warranties. Seller will, in the case of all Products sold by it to Purchaser, use its best efforts to secure for Purchaser the benefit of all warranties Seller receives in connection with its original purchase of such Products.

ARTICLE 3
TERM AND TERMINATION

3.1 Term. The term of this Agreement shall commence on the date hereof and continue for a period of one (1) year after such date (the "Initial Term"). Subject to the rights of early termination set forth in this Agreement, this Agreement shall be automatically renewed on a year-to-year basis after the Initial Term (the term of each such renewal referred to as a "Renewal Term"), unless either Party provides written notice of termination to the other Party on or before ninety (90) days prior to the end of the Initial Term or any Renewal Term.

3.2 Termination. Either Party may terminate this Agreement by giving written notice to the other Party after the occurrence of one of the following events:

(a) any breach of this Agreement by the other Party that, if capable of being cured, is not cured within 60 days after written notice of such breach is received by the breaching Party;

(b) any material breach of this Agreement by the other Party that is not capable of being cured;

(c) initiation of liquidation, dissolution, reorganization, insolvency, bankruptcy or similar proceedings by or against the other Party; or

(d) the appointment of a trustee or receiver for the other Party.

3.3 Termination Not Exclusive Remedy. The termination of this Agreement shall not release either Party from its liability to the other Party under this Agreement arising from a breach of this Agreement.

3.4 Survival. Each of the Parties' obligations under this Agreement shall survive the expiration or termination of this Agreement to the extent such obligations should have been performed during the term of this Agreement and were not so performed. Notwithstanding the expiration or termination of this Agreement, this Agreement shall remain in full force in effect until each Party has discharged all of its obligations hereunder.

ARTICLE 4
CONFIDENTIAL INFORMATION

4.1 Non-disclosure. Either Party may from time to time provide to the other Party certain advice, technical information, know-how, and other proprietary data and information with respect to the Products. Inasmuch as various of these materials and advice (all of which will herein be referred to as the "Confidential Information") contain confidential information and trade secrets, it is hereby agreed that any Confidential Information that one Party discloses to the other is valuable, proprietary property belonging to the disclosing Party, and the receiving Party agrees that it will neither use nor disclose to any third party (except in the performance of its duties hereunder) any Confidential Information, except on prior written consent of the other Party.

4.2 Return of Information. The Parties agree, either upon the termination of this Agreement or upon request, to surrender to the other all documentary material including Confidential Information, price lists, catalogues, technical literature, sales literature, samples and any other documents, papers or other properties of the other Party, however previously supplied.

4.3 Survival of Article. The obligations of the Parties pursuant to this Article shall continue in full force and effect after the termination of this Agreement regardless of how this Agreement is terminated.

ARTICLE 5
GOVERNING LAW

THE PARTIES ACKNOWLEDGE THAT THE TRANSACTIONS WHICH ARE THE SUBJECT MATTER OF THIS AGREEMENT BEAR A REASONABLE RELATION TO THE STATE OF TEXAS AND AGREE THAT THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH, AND ALL DISPUTES HEREUNDER SHALL BE GOVERNED BY, INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.

ARTICLE 6
ARBITRATION

The Parties agree that any and all disputes arising in connection with this Agreement including, but not limited to, the validity of this provision or the performance by either Party of any obligations, commitments or promises hereunder, which cannot be resolved through good faith negotiations to the mutual satisfaction of both Parties within thirty (30) calendar days (or such longer period as may be mutually agreed upon by the Parties) after the complaining Party has notified the other Party of the complaint, shall be submitted to final and binding arbitration. Any such dispute, claim or disagreement subject to arbitration pursuant to the terms of this paragraph shall be resolved by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association (the "AAA Rules"). Within ten days of the initiation of an arbitration hereunder, each Party will designate an arbitrator pursuant to the AAA Rules. The appointed arbitrators will appoint a neutral arbitrator from the panel in the manner prescribed in the AAA Rules. The Parties agree that the decision of the arbitrators selected hereunder will be final and binding on both Parties. The place of arbitration shall be Houston, Texas, and each Party shall pay its individual costs and fees arising therefrom. Judgment upon the award resulting from arbitration may be entered in any court having jurisdiction for direct enforcement, or any application may be made to a court for a judicial acceptance of the award and an order of enforcement, as the case may be.

ARTICLE 7
GENERAL PROVISIONS

7.1 Notices. To be effective, all notices, consents or communications required (other than routine orders and invoices for Products, which shall be delivered in accordance with the customary manner as in the case of orders and invoices by Purchaser and Seller in the ordinary course of their businesses) shall be in writing and shall be delivered by hand or sent by first-class prepaid certified or registered mail, return receipt requested, overnight delivery service or facsimile (confirmed by first-class

prepaid letter sent within 24 hours of dispatch) to the Parties at their respective addresses or facsimile numbers and to the attention of the persons set forth below. Any Party may change its address or facsimile number for purposes hereof by notice to all other Parties in the manner provided above. Notice will be effective upon receipt.

Purchaser

OYO Geospace Corporation
7334 N. Gessner Road
Houston, Texas 77040
Facsimile: (713) 937-8262
Attention: Mr. C. Robert Bunch

Seller

OYO Corporation
Ichigaya Building
2-6, Kudan-Kita 4-chome
Chiyoda-ku, Tokyo 102
Japan
Facsimile: 81-3-3262-5169
Attention: Mr. Katsuhiko Kobayashi

7.2 Severability. Should any provision of this Agreement be held unenforceable or invalid, then the Parties hereto agree that such provision shall be deemed modified to the extent necessary to render it lawful and enforceable, or if such a modification is not possible without materially altering the intention of the Parties hereto, then such provision shall be severed from this Agreement. In such case the validity of the remaining provisions shall not be affected and this Agreement shall be construed as if such provision were not contained herein.

7.3 Headings. All headings used herein are for the convenience of reference only, do not constitute substantive provisions of this Agreement, and shall not be used in construing the meaning or intent of the terms or provisions hereof.

7.4 Assignment. This Agreement and the rights granted hereunder shall not be assigned in whole or in part, either voluntarily, by operation of law or otherwise, without the prior written consent of both Parties, except that this Agreement may be assigned to Affiliates of a Party without prior written consent from the other Party. Any attempt to make an assignment without the consent required hereunder shall be null and void and may be treated by the other Party as a breach of a material provision of this Agreement.

7.5 Beneficiaries. This Agreement shall be binding on and inure to the benefit of the Parties and their respective successors and permitted assigns. This Agreement is intended solely for the benefit of Purchaser and Seller and their respective successors and permitted assigns.

7.6 Entire Agreement. This Agreement (including any other referenced documents) constitutes the entire agreement between Purchaser and Seller concerning the subject of this Agreement. This Agreement supersedes all prior and contemporaneous agreements, communications, statements, representations and understandings, whether oral or written, on this subject.

7.7 Amendments. Purchaser and Seller, by mutual agreement in writing, may amend, modify or supplement this Agreement. No modification or amendment of this Agreement is effective unless made in writing and signed by the Party to be bound, with such written modification or amendment stating the expressed intent to modify this Agreement. A course of dealing or performance is not a modification unless expressed in an appropriate written document and signed by the Party to be bound.

7.8 No Waiver of Rights. A Party's failure in one or more instances to exercise or enforce any right provided by this Agreement or by law does not waive its right to exercise the right in any later instance. No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach. To be effective, a waiver must be expressly written and signed by the Party to be bound. A course of dealing or performance is not a waiver unless ratified in writing by the Party to be bound.

7.9 Import/Export Regulations. The Parties agree that they will comply with the import and export laws and regulations of the United States of America and will not export or re-export any article, product, data or information to any proscribed country listed pursuant to or under such laws and regulations.

7.10 Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement, and shall become a binding agreement when one or more counterparts have been signed by each Party and delivered to the other Party. Delivery of this Agreement by a Party may be effected by sending the other Party a facsimile copy of this Agreement as executed by the delivering Party.

IN WITNESS WHEREOF, Purchaser and Seller have executed this Agreement as of the date first written above.

OYO GEOSPACE CORPORATION

By:   /s/ C. ROBERT BUNCH
    ----------------------------------------
          C. Robert Bunch
          Executive Vice President and
          Chief Operating Officer

OYO CORPORATION

By:   /s/ KATSUHIKO KOBAYASHI
    ----------------------------------------
          Katsuhiko Kobayashi
          Joint General Manager

EXHIBIT 10.6

MASTER SALES AGREEMENT

BY AND BETWEEN

OYO GEOSPACE CORPORATION

AND

OYO CORPORATION

NOVEMBER 10, 1995

MASTER SALES AGREEMENT

THIS MASTER SALES AGREEMENT is made and entered into this 10th day of November, 1995, by and between OYO Geospace Corporation, a Delaware corporation ("OYO Geospace"), with its principal office located at 7334 N. Gessner Road, Houston, Texas 77040, and OYO Corporation, a company organized and existing under the laws of Japan ("OYO Japan"), with its principal office located at Ichigaya Building, 2-6, Kudan-Kita 4-chome, Chiyoda-ku, Tokyo 102, Japan.

W I T N E S S E T H :

WHEREAS, OYO Geospace is in the business of designing and manufacturing instruments and equipment used in (i) the acquisition and processing of seismic data, (ii) time measurement and (iii) certain other applications;

WHEREAS, OYO Japan is in the business of (i) providing engineering and consulting services primarily for the investigation of the earth's subsurface primarily for construction projects and (ii) manufacturing and selling geotechnical instruments;

WHEREAS, OYO Geospace desires from time to time to sell to certain of its products on a non-exclusive basis to OYO Japan, and OYO Japan desires from time to time to purchase certain products from OYO Geospace; and

WHEREAS, OYO Japan desires from time to time to sell to certain of its products on a non-exclusive basis or resell certain products to OYO Geospace, and OYO Geospace desires from time to time to purchase certain products from OYO Japan;

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

ARTICLE 1
DEFINITIONS

1.1 Definitions. For the purposes of this Agreement, in addition to the terms defined elsewhere herein, the following terms shall have the following meanings:

(a) "Affiliate" means any Person that controls, is controlled by or is under common control with any other Person;

(b) "Agreement" means this Master Sales Agreement, as the same may subsequently be amended, modified or supplemented in accordance with its terms;

(c) "Encumbrances" means any mortgage, pledge, lien, claim, encumbrance, charge or other security interest, option, defect or other right of

any third Person of any nature whatsoever, other than inchoate mechanic's, materialmen's and similar liens arising in the ordinary course of business;

(d) "Party" means either OYO Geospace or OYO Japan, and "Parties" means both OYO Geospace and OYO Japan;

(e) "Person" means a natural person or any entity of any kind, including (without limitation) joint stock companies, corporations, partnerships, limited liability companies, governmental entities and any other entity organized or formed under the law of any jurisdiction;

(f) "Product" means any product manufactured or resold by a Party (including improved and succeeding models of such products) as may be agreed upon by the Parties in writing from time to time, other than printheads which are the subject of a separate agreement between the Parties;

(g) "Purchaser" means (i) OYO Geospace, if OYO Geospace is purchasing Products from OYO Japan pursuant to the terms and conditions of this Agreement, and includes all subsidiaries thereof, or (ii) OYO Japan, if OYO Japan is purchasing Products from OYO Geospace pursuant to the terms and conditions of this Agreement, and includes all subsidiaries and Affiliates thereof other than OYO Geospace and its subsidiaries; and

(h) "Seller" means (i) OYO Geospace, if OYO Geospace is selling Products to OYO Japan pursuant to the terms and conditions of this Agreement, and includes all subsidiaries thereof, or (ii) OYO Japan, if OYO Japan is selling Products to OYO Geospace pursuant to the terms and conditions of this Agreement, and includes all subsidiaries and Affiliates thereof other than OYO Geospace and its subsidiaries.

1.2 Other Definitional Provisions.

(a) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall, unless a specific provision is expressly referenced, refer to this Agreement as a whole and not to any particular provision of this document, and Article references contained in this Agreement are references to the Articles in this Agreement, unless otherwise specified.

(b) All words used herein in the singular shall extend to and include the plural, and all words used herein in the plural shall extend to and include the singular.

(c) All words used in any gender shall extend to and include all genders.

ARTICLE 2
SALE AND PURCHASE

2.1 Sale and Purchase Obligations.

(a) Seller agrees to sell to Purchaser, upon Purchaser's order and Purchaser thereafter agrees to purchase from Seller, any Product of Seller at any time during the term of this Agreement and in accordance with the terms and provisions hereof.

(b) If Seller is unable, for any reason other than a volitional declination to do so, to supply Purchaser with Purchaser's requirements for any Product within 30 days of receipt of an order from Purchaser, then the obligations to purchase and sell hereunder shall cease in respect of such order and shall be of no further effect or force.

(c) No provision of this Agreement shall be construed to impair Seller's right to supply any Product to any person other than Purchaser.

2.2 Orders and Deliveries. All orders, processing and deliveries of the Product shall be made in accordance with the customary and routine handling of orders, processing and deliveries to third parties in respect of the particular Product or type of Product, unless otherwise agreed in writing by both Parties

2.3 Pricing and Payment.

(a) The purchase price payable by Purchaser for each unit of the Product shall be as set forth in Schedule A hereto with respect to the Products identified therein.

(b) Seller shall provide Purchaser reasonable access to its books and records to allow Purchaser to confirm Seller's cost of manufacturing or purchasing, as the case may be, the Product.

(c) Purchaser shall be responsible for the payment of all customs charges and taxes related to the sale and purchase of the Products.

(d) Seller shall send Purchaser an invoice within 30 days after the delivery of Products pursuant to any order setting forth the types and quantities of Products shipped by Seller to Purchaser during the previous month. Within 30 days after the receipt of such invoice, Purchaser shall remit payment for such Products to Seller. All payments shall be made in United States dollars in respect of purchases from OYO Geospace and in Japanese Yen in respect of purchasers from OYO Japan except for purchases from other U.S. Affiliates of OYO Japan, which shall be in U.S. dollars.

2.4 Inspection and Rejection.

(a) Purchaser reserves the right to reject or revoke acceptance of any shipment of Product as a result of any defect or nonconformity thereof. If any Product is rejected or its acceptance is revoked, Purchaser shall notify Seller of such rejection or revocation of acceptance within 60 days of receipt of such Product, specifying with particularity the grounds for its rejection or revocation of acceptance.

(b) Seller shall immediately replace any such Product or immediately refund the price therefor, at Purchaser's option. If Seller is unable to replace any such Product within 60 days of Purchaser's rejection or revocation of acceptance for any reason other than a volitional declination to do so, then the obligations to sell and purchase in respect of such Product shall cease and be of no further effect or force.

(c) All rejected Products shall be returned by Purchaser to Seller, at Seller's sole cost, within 30 days Purchaser's rejection or revocation of acceptance of such Products.

2.5 Warranties of Seller.

(a) Seller extends to Purchaser the ordinary and customary warranty in respect of each Product sold by Seller to Purchaser as if Purchaser were a third party; provided, however, that such warranty applies only to Products that are manufactured by the Seller and not to Products that are manufactured by a third party and resold by the Seller.

(b) Seller warrants to Purchaser that the Products, at the time of delivery to Purchaser, will be free from any Encumbrances.

2.6 Risk of Loss. The risk of loss from any casualty to the Products, regardless of the cause, shall be on Seller up to the time of receipt of the Products by Purchaser at Purchaser's delivery destination and until Purchaser has completed any proper inspection without rejection of the Products.

2.7 Indemnification. Seller agrees to defend, indemnify and hold harmless Purchaser, its affiliates and their respective directors, officers, employees, agents, successors and assigns from and against any and all claims, losses, damages, liabilities, reasonable counsel fees and costs incident thereto incurred by or asserted against Purchaser as a result of damage to the property of Purchaser or others, or personal injuries to or injuries resulting in the death of any person or persons, including directors, officers, employees and agents of Purchaser relating to the Products; provided, however, Seller shall not have any liability (whether direct or indirect, in contract, tort or otherwise) to Purchaser unless such claims, losses, damages, liabilities, counsel fees or costs are determined, in a final judgment by a court of competent jurisdiction (not subject to further appeal), to have resulted primarily and directly from

the gross negligence or willful misconduct of Seller or its directors, officers, employees or agents.

ARTICLE 3
TERM AND TERMINATION

3.1 Term. The term of this Agreement shall commence on the date hereof and continue for a period of one (1) year after such date (the "Initial Term"). Subject to the rights of early termination set forth in this Agreement, this Agreement shall be automatically renewed on a year-to-year basis after the Initial Term (the term of each such renewal referred to as a "Renewal Term"), unless either Party provides written notice of termination to the other Party on or before ninety (90) days prior to the end of the Initial Term or any Renewal Term.

3.2 Termination. Either Party may terminate this Agreement by giving written notice to the other Party after the occurrence of one of the following events:

(a) any material breach of this Agreement by the other Party that is not capable of being cured;

(b) any breach of this Agreement by the other Party that, if capable of being cured, is not cured within 60 days after written notice of such breach is received by the breaching Party;

(c) initiation of liquidation, dissolution, reorganization, insolvency, bankruptcy or similar proceedings by or against the other Party; or

(d) the appointment of a trustee or receiver for the other Party.

3.3 Termination Not Exclusive Remedy. The termination of this Agreement shall not release either Party from its liability to the other Party under this Agreement arising from a breach of this Agreement.

3.4 Survival. Each of the Parties' obligations under this Agreement shall survive the expiration or termination of this Agreement to the extent such obligations should have been performed during the term of this Agreement and were not so performed. Notwithstanding the expiration or termination of this Agreement, this Agreement shall remain in full force in effect until each Party has discharged all of its obligations hereunder.

ARTICLE 4
CONFIDENTIAL INFORMATION

4.1 Non-disclosure. Either Party may from time to time provide to the other Party certain advice, technical information, know-how, and other proprietary data and information with respect to the Products. Inasmuch as various of these materials and

advice (all of which will herein be referred to as the "Confidential Information") contain confidential information and trade secrets, it is hereby agreed that any Confidential Information that one Party discloses to the other is valuable, proprietary property belonging to the disclosing Party, and the receiving Party agrees that it will neither use nor disclose to any third party (except in the performance of its duties hereunder) any Confidential Information, except on prior written consent of the other Party.

4.2 Return of Information. The Parties agree, either upon the termination of this Agreement or upon request, to surrender to the other all documentary material including Confidential Information, price lists, catalogues, technical literature, sales literature, samples and any other documents, papers or other properties of the other Party, however previously supplied.

4.3 Survival of Article. The obligations of the Parties pursuant to this Article shall continue in full force and effect after the termination of this Agreement regardless of how this Agreement is terminated.

ARTICLE 5
GOVERNING LAW

THE PARTIES ACKNOWLEDGE THAT THE TRANSACTIONS WHICH ARE THE SUBJECT MATTER OF THIS AGREEMENT BEAR A REASONABLE RELATION TO THE STATE OF TEXAS AND AGREE THAT THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH, AND ALL DISPUTES HEREUNDER SHALL BE GOVERNED BY, INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.

ARTICLE 6
ARBITRATION

The Parties agree that any and all disputes arising in connection with this Agreement including, but not limited to, the validity of this provision or the performance by either Party of any obligations, commitments or promises hereunder, which cannot be resolved through good faith negotiations to the mutual satisfaction of both Parties within thirty (30) calendar days (or such longer period as may be mutually agreed upon by the Parties) after the complaining Party has notified the other Party of the complaint, shall be submitted to final and binding arbitration. Any such dispute, claim or disagreement subject to arbitration pursuant to the terms of this paragraph shall be resolved by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association (the "AAA Rules"). Within ten days of the initiation of an arbitration hereunder, each Party will designate an arbitrator pursuant to the AAA Rules. The appointed arbitrators will appoint a neutral arbitrator from the panel in the manner prescribed in the AAA Rules. The arbitrators shall not have any authority to award consequential, exemplary or punitive damages. The Parties agree that the decision of the arbitrators selected hereunder will be final and binding on both Parties. The place of arbitration shall be Houston, Texas, and each Party shall pay its individual costs and fees arising therefrom. Judgment upon the award resulting from

arbitration may be entered in any court having jurisdiction for direct enforcement, or any application may be made to a court for a judicial acceptance of the award and an order of enforcement, as the case may be.

ARTICLE 7
GENERAL PROVISIONS

7.1 Notices. To be effective, all notices, consents or communications required (other than routine orders and invoices for Products, which shall be delivered in the customary manner as in the case of orders and invoices to third parties) shall be in writing and shall be delivered by hand or sent by first-class prepaid certified or registered mail, return receipt requested, overnight delivery service or facsimile (confirmed by first-class prepaid letter sent within 24 hours of dispatch) to the Parties at their respective addresses or facsimile numbers and to the attention of the persons set forth below. Any Party may change its address or facsimile number for purposes hereof by notice to all other Parties in the manner provided above. Notice will be effective upon receipt.

OYO Geospace Corporation
7334 N. Gessner Road
Houston, Texas 77040
Facsimile: (713) 937-8262 Attention: Mr. C. Robert Bunch

OYO Corporation
Ichigaya Building
2-6, Kudan-Kita 4-chome
Chiyoda-ku, Tokyo 102
Japan
Facsimile: 81-3-3262-5169 Attention: Mr. Katsuhiko Kobayashi

7.2 Severability. Should any provision of this Agreement be held unenforceable or invalid, then the Parties hereto agree that such provision shall be deemed modified to the extent necessary to render it lawful and enforceable, or if such a modification is not possible without materially altering the intention of the Parties hereto, then such provision shall be severed from this Agreement. In such case the validity of the remaining provisions shall not be affected and this Agreement shall be construed as if such provision were not contained herein.

7.3 Headings. All headings used herein are for the convenience of reference only, do not constitute substantive provisions of this Agreement, and shall not be used in construing the meaning or intent of the terms or provisions hereof.

7.4 Assignment. This Agreement and the rights granted hereunder shall not be assigned in whole or in part, either voluntarily, by operation of law or otherwise, without the prior written consent of both Parties, except that this Agreement may be assigned to Affiliates of a Party without prior written consent from the other Party. Any attempt to make an assignment without the consent required hereunder shall be null and void and may be treated by the other Party as a breach of a material provision of this Agreement.

7.5 Beneficiaries. This Agreement shall be binding on and inure to the benefit of the Parties and their respective successors and permitted assigns. This Agreement is intended solely for the benefit of Purchaser and Seller and their respective successors and permitted assigns.

7.6 Entire Agreement. This Agreement constitutes the entire agreement between Purchaser and Seller concerning the subject of this Agreement. This Agreement supersedes all prior and contemporaneous agreements, communications, statements, representations and understandings, whether oral or written, on this subject.

7.7 Amendments. Purchaser and Seller, by mutual agreement in writing, may amend, modify or supplement this Agreement. No modification or amendment of this Agreement is effective unless made in writing and signed by the Party to be bound, with such written modification or amendment stating the expressed intent to modify this Agreement. A course of dealing or performance is not a modification unless expressed in an appropriate written document and signed by the Party to be bound.

7.8 No Waiver of Rights. A Party's failure in one or more instances to exercise or enforce any right provided by this Agreement or by law does not waive its right to exercise the right in any later instance. No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach. To be effective, a waiver must be expressly written and signed by the Party to be bound. A course of dealing or performance is not a waiver unless ratified in writing by the Party to be bound.

7.9 Import/Export Regulations. The Parties agree that they will comply with the import and export laws and regulations of the United States of America and will not export or re-export any article, product, data or information to any proscribed country listed pursuant to or under such laws and regulations.

7.10 Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement, and shall become a binding agreement when one or more counterparts have been signed by each Party and delivered to the other Party. Delivery of this Agreement by a Party may be

effected by sending the other Party a facsimile copy of this Agreement as executed by the delivering Party.

IN WITNESS WHEREOF, OYO Geospace and OYO Japan have executed this Agreement as of the date first written above.

OYO GEOSPACE CORPORATION

By:          /s/ C. ROBERT BUNCH
        ---------------------------------
                 C. Robert Bunch
        Executive Vice President and
           Chief Operating Officer

OYO CORPORATION

By:          /s/ KATSUHIKO KOBAYASHI
        ---------------------------------
                 Katsuhiko Kobayashi
              Joint General Manager

                                    PRICE (REFLECTED AS A
PRODUCT                             PERCENTAGE OF THE CURRENT LIST PRICE)
-------                             -------------------------------------
Data Acquisition System             80% (if sold to OYO Japan)

Geophones, Hydrophones,             90-95%
  Connectors and Cables


Parts and Supplies for              90%
  Products


All other Products sold             80%
  between the Parties