CORE LABORATORIES N V (Form: 10-Q, Received: 05/12/2008 06:02:05)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


FORM 10-Q

(Mark One)
X	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2008

OR

	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________ to ______________

Commission File Number: 001-14273

CORE LABORATORIES N.V.
(Exact name of registrant as specified in its charter)

The Netherlands		Not Applicable
(State of other jurisdiction of		(I.R.S. Employer Identification No.)
incorporation or organization)

Herengracht 424
1017 BZ Amsterdam
The Netherlands		Not Applicable
(Address of principal executive offices)		(Zip Code)

(31-20) 420-3191
(Registrant's telephone number, including area code)

None
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ X ] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. Large accelerated filer [ X ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [ X ]

The number of common shares of the Registrant, par value EUR 0.04 per share, outstanding at May 8, 2008 was 22,987,532.

CORE LABORATORIES N.V.
FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2008

INDEX

		Page
PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements

	Consolidated Balance Sheets at March 31, 2008 (Unaudited) and December 31, 2007	1

	Consolidated Statements of Operations (Unaudited) for the Three Months Ended
	March 31, 2008 and 2007	2

	Consolidated Statements of Cash Flows (Unaudited) for the Three Months Ended
	March 31, 2008 and 2007	4

	Notes to Unaudited Consolidated Interim Financial Statements	5

Item 2.	Management's Discussion and Analysis of Financial Condition and
	Results of Operations	15

Item 3.	Quantitative and Qualitative Disclosures of Market Risk	21

Item 4.	Controls and Procedures	21


PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	22

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22

Item 6.	Exhibits	23

	Signature	24

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

CORE LABORATORIES N.V.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

				March 31,	December 31,
				2008	2007
		ASSETS		(Unaudited)
CURRENT ASSETS:
	Cash and cash equivalents			$ 28,527	$ 25,617
	Accounts receivable, net of allowance for doubtful accounts of $4,463 and
	$4,199 at 2008 and 2007, respectively			146,736	137,231
	Inventories, net			31,613	29,363
	Prepaid expenses and other current assets			37,807	28,488
		TOTAL CURRENT ASSETS		244,683	220,699

PROPERTY, PLANT AND EQUIPMENT, net				92,850	93,038
INTANGIBLES, net				6,984	7,040
GOODWILL				138,800	138,800
DEFERRED TAX ASSET				20,110	26,024
OTHER ASSETS				19,481	19,189
		TOTAL ASSETS		$ 522,908	$ 504,790

		LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
	Current maturities of long-term debt and capital lease obligations			$ 1,906	$ 3,027
	Accounts payable			35,690	39,861
	Accrued payroll and related costs			27,156	25,689
	Taxes other than payroll and income			8,720	8,820
	Unearned revenues			9,537	9,130
	Other accrued expenses			10,468	11,513
		TOTAL CURRENT LIABILITIES		93,477	98,040

LONG-TERM DEBT				300,000	300,000
DEFERRED COMPENSATION				14,080	14,080
OTHER LONG-TERM LIABILITIES				39,182	29,041
COMMITMENTS AND CONTINGENCIES
MINORITY INTEREST				1,588	1,486

SHAREHOLDERS' EQUITY:
	Preference shares, EUR 0.04 par value;
			3,000,000 shares authorized, none issued or outstanding	-	-
	Common shares, EUR 0.04 par value;
			100,000,000 shares authorized, 23,252,659 issued and 22,984,280 outstanding at 2008
			and 23,080,949 issued and 23,065,949 outstanding at 2007	1,310	1,300
	Additional paid-in capital			11,890	-
	Retained earnings			91,829	62,496
	Accumulated other comprehensive income			246	226
	Treasury shares (at cost), 268,379 at 2008 and 15,000 at 2007			(30,694)	(1,879)
		TOTAL SHAREHOLDERS' EQUITY		74,581	62,143
		TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$ 522,908	$ 504,790

The accompanying notes are an integral part of these consolidated financial statements.

Return to Index

CORE LABORATORIES N.V.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

		Three Months Ended March 31,
		2008	2007
		(Unaudited)
REVENUES:
	Services	$ 138,409	$ 116,965
	Product Sales	41,028	38,758
		179,437	155,723
OPERATING EXPENSES:
	Cost of services	91,159	79,854
	Cost of sales	28,314	27,395
	General and administrative expenses	8,289	8,039
	Depreciation	5,097	4,486
	Amortization	142	92
	Other expense (income), net	2,168	(863)
OPERATING INCOME		44,268	36,720
Interest expense		644	632
Income before income tax expense		43,624	36,088
Income tax expense		14,291	10,826
NET INCOME		$ 29,333	$ 25,262

EARNINGS PER SHARE INFORMATION:
Basic earnings per share		$ 1.28	$ 1.08

Diluted earnings per share		$ 1.22	$ 1.04

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic		22,982	23,430

Diluted		23,998	24,322

The accompanying notes are an integral part of these consolidated financial statements.

Return to Index

CORE LABORATORIES N.V.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

			Three Months Ended March 31,
			2008	2007
			(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income			$ 29,333	$ 25,262
Adjustments to reconcile income to net cash provided by operating activities:
	Net provision for doubtful accounts		210	361
	Inventory obsolescence		41	51
	Equity in loss (income) of affiliates		(55)	-
	Minority interest		103	(76)
	Stock-based compensation		827	1,148
	Depreciation and amortization		5,239	4,578
	Debt issuance costs amortization		370	623
	Gain on sale of assets		(1,284)	(48)
	Realization of pension obligation		20	18
	Increase in value of life insurance policies		725	(106)
	Deferred income taxes		2,863	177
	Changes in assets and liabilities, net of effect of dispositions:
		Accounts receivable	(9,714)	(11,144)
		Inventories	(2,292)	(2,334)
		Prepaid expenses and other current assets	(6,363)	59
		Other assets	(1,281)	(134)
		Accounts payable	(4,171)	(3,946)
		Accrued expenses	729	(608)
		Other long-term liabilities	10,140	5,277
	Net cash provided by operating activities		25,440	19,158
CASH FLOWS FROM INVESTING ACTIVITIES:
		Capital expenditures	(5,618)	(3,427)
		Patents and other intangibles	(86)	(45)
		Proceeds from sale of assets	2,467	76
		Premiums on life insurance	(430)	(764)
	Net cash used in investing activities		(3,667)	(4,160)
CASH FLOWS FROM FINANCING ACTIVITIES:
		Repayment of debt	(6,120)	(982)
		Proceeds from debt borrowings	5,000	-
		Capital lease obligations	(1)	(1)
		Stock options exercised	633	16,918
		Excess tax benefits from stock-based compensation	10,440	2,609
		Debt issuance costs	-	(152)
		Repurchase of common shares	(28,815)	(58,624)
	Net cash used in financing activities		(18,863)	(40,232)
NET CHANGE IN CASH AND CASH EQUIVALENTS			2,910	(25,234)
CASH AND CASH EQUIVALENTS, beginning of period			25,617	54,223
CASH AND CASH EQUIVALENTS, end of period			$ 28,527	$ 28,989


The accompanying notes are an integral part of these consolidated financial statements.

Return to Index

CORE LABORATORIES N.V.

NOTES TO THE UNAUDITED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements include the accounts of Core Laboratories N.V. and its subsidiaries for which we have a controlling voting interest and/or a controlling financial interest. These financial statements have been prepared in accordance with United States ("U.S.") generally accepted accounting principles ("GAAP") for interim financial information using the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these financial statements do not include all of the information and footnote disclosures required by GAAP for complete financial statements.

Core Laboratories N.V. uses the equity method of accounting for all investments in which it has less than a majority interest and over which it does not exercise control. Minority interest has been recorded to reflect outside ownership attributable to consolidated subsidiaries that are less than 100% owned. In the opinion of management, all adjustments considered necessary for a fair presentation for the periods presented have been included in these financial statements. Furthermore, the operating results presented for the three months ended March 31, 2008 may not necessarily be indicative of the results that may be expected for the year ending December 31, 2008.

Core Laboratories N.V.'s balance sheet information for the year ended December 31, 2007 was derived from the 2007 audited consolidated financial statements but does not include all disclosures in accordance with GAAP.

References to "Core Lab", "we", "our", and similar phrases are used throughout this Quarterly Report on Form 10-Q and relate collectively to Core Laboratories N.V. and its consolidated subsidiaries.

These financial statements should be read in conjunction with the financial statements and the summary of significant accounting policies and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2007.

2. INVENTORIES

Inventories consist of the following (in thousands):

	March 31,	December 31,
	2008	2007
	(Unaudited)
Finished goods	$ 22,381	$ 21,795
Parts and materials	8,241	6,433
Work in progress	991	1,135
Total inventories, net	$ 31,613	$ 29,363

We include freight costs incurred for shipping inventory to customers in the Cost of Sales line of the Consolidated Statement of Operations.

3. GOODWILL AND INTANGIBLES

We account for intangible assets with indefinite lives, including goodwill, in accordance with Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets", which requires us to evaluate these assets for impairment annually, or more frequently if an indication of impairment has occurred. Based upon our most recent evaluation, management determined that goodwill was not impaired. We amortize intangible assets with a defined term on a straight-line basis over their respective useful lives. There were no significant changes related to our intangible assets for the three months ended March 31, 2008. The composition of goodwill by business segment at March 31, 2008 is consistent with the amounts disclosed in our Annual Report on Form 10-K as of December 31, 2007.

4. DEBT AND CAPITAL LEASE OBLIGATIONS

Debt is summarized in the following table (in thousands):

	March 31,	December 31,
	2008	2007
	(Unaudited)
Senior exchangeable notes	$ 300,000	$ 300,000
Capital lease obligations	2	3
Other indebtedness	1,904	3,024
Total debt and capital leases obligations	301,906	303,027
Less - short-term debt included in other indebtedness	1,904	3,024
Less - current maturities of long-term debt and capital lease obligations	2	3
Long-term debt and capital lease obligations	$ 300,000	$ 300,000

In 2006, Core Laboratories LP, a wholly owned subsidiary of Core Laboratories N.V., issued $300 million aggregate principal amount of Senior Exchangeable Notes due 2011 (the "Notes"). The Notes bear interest at a rate of 0.25% per year paid on a bi-annual basis and are fully and unconditionally guaranteed by Core Laboratories N.V. The Notes are exchangeable into shares of Core Laboratories N.V. under certain circumstances at an initial conversion rate of 10.5533 per $1,000 principal amount of notes. Upon exchange, holders will receive cash up to the principal amount, and any excess exchange value will be delivered in Core Laboratories N.V. common shares.

We maintain a revolving credit facility (the "Credit Facility") that allows for an aggregate borrowing capacity of $100.0 million. As amended, this facility provides an option to increase the commitment under the Credit Facility to $150.0 million, if certain conditions are met. The Credit Facility bears interest at variable rates from LIBOR plus 0.5% to a maximum of LIBOR plus 1.125%. %. Any outstanding balance under the Credit Facility is due in December 2010 when the Credit Facility matures. Interest payment terms are variable depending upon the specific type of borrowing under this facility. Our available capacity is reduced by outstanding unsecured letters of credit and performance guarantees and bonds totaling $11.6 million at March 31, 2008 relating to certain projects in progress. Our available borrowing capacity under the Credit Facility at March 31, 2008 was $88.4 million.

5. PENSIONS AND OTHER POSTRETIREMENT BENEFITS

We provide a noncontributory defined benefit pension plan covering substantially all of our Dutch employees, payouts under which are determined based on years of service and final pay or career average pay, depending on when the employee began participating. Employees are immediately vested in the benefits earned. We fund the future obligations of this plan by purchasing investment contracts from a large insurance company. We make annual premium payments, based on each employee's age and current salary, to the insurance company.

The following table summarizes the components of net periodic pension cost under this plan for the three months ended March 31, 2008 and 2007 (in thousands):

	Three Months Ended March 31,
	2008	2007
	(Unaudited)
Service cost	$ 286	$ 291
Interest cost	338	266
Expected return on plan assets	(306)	(243)
Unrecognized pension obligation/(asset), net	(25)	(22)
Prior service cost	45	40
Net periodic pension cost	$ 338	$ 332

During the three months ended March 31, 2008, we contributed approximately $1.1 million, as determined by the insurance company, to fund the estimated 2008 premiums on investment contracts held by the plan.

On January 1, 2008, we adopted Statement of Financial Accounting Standards No. 157 ("SFAS 157") Fair Value Measurements for financial assets and liabilities. We have not adopted SFAS 157 for nonfinancial assets and nonfinancial liabilities for those measured on a nonrecurring basis as the adoption date has been deferred until January 1, 2009 pursuant to Financial Accounting Standards Board Staff Position No. 157-2. The application of FAS 157 to the Company's nonfinancial assets and liabilities will primarily be limited to asset impairments including Goodwill and this application is not expected to have a material impact to the Company . This new standard addresses how companies should measure fair value when they are required to use a fair value measure for recognition or disclosure purposes. On a recurring basis, we use the market approach to value certain liabilities at fair value at quoted prices in an active market (Level 1) and certain assets and liabilities using significant other observable inputs (Level 2). We do not have any assets or liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3). Gains and losses related to the fair value changes in the deferred compensation assets and liabilities are recorded in General and Administrative Expenses in the Consolidated Statement of Operations. The following table summarizes the fair value balances (in thousands):

		Fair Value Measurement at March 31, 2008
	Total	Level 1	Level 2	Level 3
Assets:
Equity and other investment fund assets	$ 4,562	$ -	$ 4,562	$ -

Liabilities:
Deferred compensation plan	$ 7,553	$ 3,740	$ 3,813	$ -

We have adopted a non-qualified deferred compensation plan that allows certain highly compensated employees to defer a portion of their salary, commission and bonus, as well as the amount of any reductions in their deferrals under the deferred compensation plan for employees in the United States (the "Deferred Compensation Plan"), due to certain limitations imposed by the U.S. Internal Revenue Code of 1986, as amended. The Deferred Compensation Plan also provides for employer contributions to be made on behalf of participants equal in amount to certain forfeitures of, and/or reductions in, employer contributions that participants could have received under the 401(k) Plan in the absence of certain limitations imposed by the Internal Revenue Code. Employer contributions to the deferred compensation plan vest ratably over a period of five years. Contributions to the plan are invested in equity and other investment fund assets, and carried on the balance sheet at fair value. The benefits under these contracts are fully vested and payment of benefits generally commences as soon as practicable after the last day of the calendar quarter during which the participant terminated employment .

6. COMMITMENTS AND CONTINGENCIES

From time to time, we may be subject to legal proceedings and claims that arise in the ordinary course of business. We believe that the resolution of all litigation currently pending or threatened against Core Lab or any of its subsidiaries should not have a material adverse effect on its consolidated financial condition, results of operations or liquidity; however, because of the inherent uncertainty of litigation, we cannot provide assurance that the resolution of any particular claim or proceeding to which Core Lab or any of its subsidiaries is a party will not have a material adverse effect on its consolidated results of operations or liquidity for the period in which that resolution occurs.

In 2008, we revised our estimate of a contingent liability associated with non-income related taxes, and as a result a charge to income of $5.0 million was recorded in the Consolidated Statement of Operations to Other Expense (Income), net. This adjustment requires judgment, assumptions and estimations to quantify the uncertainties related to this contingent liability. Management has concluded the adjustment relates to prior periods, however as the amounts are not material, no prior periods have been restated. The contingent liability is included in Other Long-term Liabilities in the Consolidated Balance Sheet. Management will continue to assess on a quarterly basis the probable outcome of the settlement of these taxes. The ultimate settlement amount and timing of this contingent liability is uncertain, and could possibly expose the Company to expenses of approximately $20.0 million in excess of our current estimate.

7. SHAREHOLDERS' EQUITY

During the three months ended March 31, 2008, we repurchased 253,379 of our common shares for $28.8 million, at an average price of $113.72 per share which included rights to 44,512 shares valued at $5.0 million, or $112.14 per share, were surrendered to the Company pursuant to the terms of a stock-based compensation plan, in consideration of their personal tax burdens that may result from the issuance of common shares under this plan. Such common shares, unless cancelled, may be reissued for a variety of purposes such as to use for future acquisitions, for settlement of employee stock awards as they vest, or possible conversion of the Notes.

For the three months ended March 31, 2008, we issued 42,160 of our common shares associated with stock option exercises for which we received proceeds of approximately $0.6 million.

During the three month period ended March 31, 2008, we recognized tax benefits of $10.4 million, relating to tax deductions in excess of book expense for stock-based compensation awards. These tax benefits are recorded to additional paid-in capital to the extent deductions reduce current taxable income.

Comprehensive Income

The components of other comprehensive income consisted of the following (in thousands):

	March 31,
	2008	2007
	(Unaudited)
Net income	$ 29,333	$ 25,262
Realization of pension obligation	20	18
Total comprehensive income	$ 29,353	$ 25,280

Accumulated Other Comprehensive Income consisted of the following (in thousands):

	March 31,	December 31,
	2008	2007
	(Unaudited)
Prior service cost	$ (1,163)	$ (1,208)
Transition asset	494	519
Unrecognized net actuarial loss	915	915
Total accumulated other comprehensive income	$ 246	$ 226

8. EARNINGS PER SHARE

We compute basic earnings per common share by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per common and potential common shares include additional shares in the weighted average share calculations associated with the incremental effect of dilutive employee stock options, restricted stock awards and contingently issuable shares, as determined using the treasury stock method. The following table summarizes the calculation of weighted average common shares outstanding used in the computation of diluted earnings per share (in thousands):

	Three Months Ended March 31,
	2008	2007
	(Unaudited)
Weighted average basic common shares outstanding	22,982	23,430
Effect of dilutive securities:
Stock options	153	664
Contingent shares	64	121
Restricted stock and other	137	107
Senior exchangeable notes	662	-
Weighted average diluted common and potential common shares outstanding	23,998	24,322

In 2006, we sold warrants that give the holders the right to acquire approximately 3.2 million of our common shares at an exercise price of $127.56 per share. These warrants could have a dilutive impact on our earnings per share if the share price exceeds the strike price of the warrants.

9. OTHER EXPENSE (INCOME), NET

The components of other expense (income), net, were as follows (in thousands):

	Three Months Ended March 31,
	2008	2007
	(Unaudited)
Minority interest	$ 103	$ (76)
Gain on sale of assets	(1,284)	(48)
Foreign exchange (gain) loss	(746)	18
Interest income	(108)	(411)
Non-income tax accrual	5,030	-
Other	(827)	(346)
Total other expense (income), net	$ 2,168	$ (863)

In 2008, we revised our estimate of a contingent liability associated with non-income related taxes, and as a result a charge to income of $5.0 million was recorded. Additionally, we recorded a gain of $1.1 million in connection with the sale of a small office building.

Foreign exchange (gains) losses by currency are summarized in the following table (in thousands):

	Three Months Ended March 31,
	2008	2007
	(Unaudited)
Canadian Dollar	$ 215	$ 106
Euro	(586)	(38)
Russian Ruble	(157)	(40)
Other currencies	(218)	(10)
Total (gain) loss	$ (746)	$ 18

10. SEGMENT REPORTING

Our business units have been aggregated into three complementary segments, which provide products and services for improving reservoir performance and increasing oil and gas recovery from new and existing fields.

*	Reservoir Description: Encompasses the characterization of petroleum reservoir rock, fluid and gas samples. We provide analytical and field services to characterize properties of crude oil and petroleum products to the oil and gas industry.

*	Production Enhancement: Includes products and services relating to reservoir well completions, perforations, stimulations and production. We provide integrated services to evaluate the effectiveness of well completions and to develop solutions aimed at increasing the effectiveness of enhanced oil recovery projects.

*	Reservoir Management: Combines and integrates information from reservoir description and production enhancement services to increase production and improve recovery of oil and gas from our clients' reservoirs.

Segment Analysis

We manage each of our business segments separately to reflect the different services and technologies provided and required by each segment. We use the same accounting policies to account for our business segments as those used to prepare our Consolidated Balance Sheets and Consolidated Statements of Operations. We evaluate the performance of our business segments on the basis of operating income.

Summarized financial information relating to our business segments is shown in the following tables (in thousands):

	(Unaudited)	Reservoir Description	Production Enhancement	Reservoir Management	Corporate & Other ¹	Consolidated
Three Months Ended March 31, 2008
	Revenues from unaffiliated customers	$ 100,501	$ 67,024	$ 11,912	$ -	$ 179,437
	Inter-segment revenues	233	193	315	(741)	-
	Segment operating income (loss)	23,017	21,941	4,227	(4,917)	44,268
	Total assets	248,200	172,796	22,385	79,527	522,908
	Capital expenditures	3,315	2,172	97	34	5,618
	Depreciation and amortization	2,929	1,386	153	771	5,239

Three Months Ended March 31, 2007
	Revenues from unaffiliated customers	$ 83,163	$ 58,807	$ 13,753	$ -	$ 155,723
	Inter-segment revenues	167	205	291	(663)	-
	Segment operating income	16,773	16,052	3,697	198	36,720
	Total assets	219,681	166,627	19,358	82,544	488,210
	Capital expenditures	2,570	606	89	162	3,427
	Depreciation and amortization	2,372	1,284	127	795	4,578


	(1) "Corporate & Other" represents those items that are not directly related to a particular segment and eliminations.

11. CONDENSED CONSOLIDATING FINANCIAL INFORMATION

Core Laboratories N.V. has fully and unconditionally guaranteed all of the Notes issued by Core Laboratories LP in 2006. Core Laboratories LP is a 100% indirectly owned subsidiary of Core Laboratories N.V.

The following condensed consolidating financial information is included so that separate financial statements of Core Laboratories LP are not required to be filed with the U.S. Securities and Exchange Commission. The condensed consolidating financial statements present investments in both consolidated and unconsolidated affiliates using the equity method of accounting.

The following condensed consolidating financial information presents: condensed consolidating balance sheets as of March 31, 2008 and December 31, 2007, statements of income and the consolidating statements of cash flows for each of the quarters ended March 31, 2008 and 2007 of (a) Core Laboratories N.V., parent/guarantor, (b) Core Laboratories LP, issuer of public debt securities guaranteed by Core Laboratories N.V. and (c) the non-guarantor subsidiaries, (d) consolidating adjustments necessary to consolidate Core Laboratories N.V. and its subsidiaries and (e) Core Laboratories N.V. on a consolidated basis.

Condensed Consolidating Balance Sheets

		(In thousands)	March 31, 2008
			Core Laboratories N.V. (Parent/ Guarantor)	Core Laboratories LP (Issuer)	Other Subsidiaries (Non- Guarantors)	Consolidating Adjustments	Consolidated Total
		ASSETS
CURRENT ASSETS:
	Cash and cash equivalents		$ 2,137	$ 12,195	$ 14,195	$ -	$ 28,527
	Accounts receivable, net		187	32,761	113,788	-	146,736
	Inventories, net		-	3,377	28,236	-	31,613
	Prepaid expenses and other current assets		589	12,979	24,239	-	37,807
			2,913	61,312	180,458	-	244,683

PROPERTY, PLANT AND EQUIPMENT, net			-	21,362	71,488	-	92,850
GOODWILL AND INTANGIBLES, net			46,986	8,573	90,225	-	145,784
INTERCOMPANY RECEIVABLES			58,905	277,779	351,410	(688,094)	-
INVESTMENT IN AFFILIATES			299,104	-	1,032,902	(1,331,717)	289
DEFERRED TAX ASSET			2,982	20,058	-	(2,930)	20,110
OTHER ASSETS			3,276	10,685	5,231	-	19,192
		TOTAL ASSETS	$ 414,166	$ 399,769	$ 1,731,714	$ (2,022,741)	$ 522,908

		LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
	Current maturities of long-term debt and capital lease obligations		$ 1,904	$ -	$ 2	$ -	$ 1,906
	Accounts payable		1,221	4,525	29,944	-	35,690
	Other accrued expenses		3,974	10,213	41,694	-	55,881
			7,099	14,738	71,640	-	93,477

LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS			-	300,000	-	-	300,000
DEFERRED COMPENSATION			5,879	7,744	457	-	14,080
DEFERRED TAX LIABILITY			-	324	2,606	(2,930)	-
INTERCOMPANY PAYABLES			309,590	10,189	368,315	(688,094)	-
OTHER LONG-TERM LIABILITIES			17,017	12,490	9,675	-	39,182

MINORITY INTEREST			-	-	1,588	-	1,588

TOTAL SHAREHOLDERS' EQUITY			74,581	54,284	1,277,433	(1,331,717)	74,581
		TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 414,166	$ 399,769	$ 1,731,714	$ (2,022,741)	$ 522,908

Condensed Consolidating Balance Sheets

		(In thousands)	December 31, 2007
			Core Laboratories N.V. (Parent/ Guarantor)	Core Laboratories LP (Issuer)	Other Subsidiaries (Non- Guarantors)	Consolidating Adjustments	Consolidated Total
		ASSETS
CURRENT ASSETS:
	Cash and cash equivalents		$ 6,712	$ 7,818	$ 11,087	$ -	$ 25,617
	Accounts receivable, net		114	28,782	108,335	-	137,231
	Inventories, net		-	2,681	26,682	-	29,363
	Prepaid expenses and other current assets		887	9,901	17,700	-	28,488
			7,713	49,182	163,804	-	220,699

PROPERTY, PLANT AND EQUIPMENT, net			-	21,288	71,750	-	93,038
GOODWILL AND INTANGIBLES, net			46,986	8,652	90,202	-	145,840
INTERCOMPANY RECEIVABLES			25,828	334,793	327,791	(688,412)	-
INVESTMENT IN AFFILIATES			267,943	-	914,018	(1,181,727)	234
DEFERRED TAX ASSET			2,507	25,925	1,726	(4,134)	26,024
OTHER ASSETS			3,634	11,456	3,865	-	18,955
		TOTAL ASSETS	$ 354,611	$ 451,296	$ 1,573,156	$ (1,874,273)	$ 504,790

		LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
	Current maturities of long-term debt and capital lease obligations		$ 3,024	$ -	$ 3	$ -	$ 3,027
	Accounts payable		2,417	4,581	32,863	-	39,861
	Other accrued expenses		1,325	21,057	32,770	-	55,152
			6,766	25,638	65,636	-	98,040

LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS			-	300,000	-	-	300,000
DEFERRED COMPENSATION			5,688	7,980	412	-	14,080
DEFERRED TAX LIABILITY			4,134	-	-	(4,134)	-
INTERCOMPANY PAYABLES			264,976	66,550	356,886	(688,412)	-
OTHER LONG-TERM LIABILITIES			10,904	8,716	9,421	-	29,041

MINORITY INTEREST			-	-	1,486	-	1,486

TOTAL SHAREHOLDERS' EQUITY			62,143	42,412	1,139,315	(1,181,727)	62,143
		TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 354,611	$ 451,296	$ 1,573,156	$ (1,874,273)	$ 504,790

Condensed Consolidating Statements of Operations

		(In thousands)	Quarter Ended March 31, 2008
			Core Laboratories N.V. (Parent/ Guarantor)	Core Laboratories LP (Issuer)	Other Subsidiaries (Non- Guarantors)	Consolidating Adjustments	Consolidated Total
REVENUES
	Operating revenues		$ -	$ 39,665	$ 139,772	$ -	$ 179,437
	Intercompany revenues		267	3,852	32,669	(36,788)	-
	Earnings from consolidated affiliates		38,137	-	95,282	(133,419)	-
		Total revenues	38,404	43,517	267,723	(170,207)	179,437

OPERATING EXPENSES
	Operating costs		297	21,161	98,015	-	119,473
	General and administrative expenses		3,520	4,766	3	-	8,289
	Depreciation and amortization		-	1,372	3,867	-	5,239
	Other expense (income), net		4,537	823	21,936	(25,128)	2,168

Operating income			30,050	15,395	143,902	(145,079)	44,268
Interest expense			36	608	-	-	644

Income before income tax expense			30,014	14,787	143,902	(145,079)	43,624
Income tax expense (benefit)			681	2,915	10,695	-	14,291

NET INCOME			$ 29,333	$ 11,872	$ 133,207	$ (145,079)	$ 29,333

Condensed Consolidating Statements of Cash Flows

		(In thousands)	Quarter Ended March 31, 2008
			Core Laboratories N.V. (Parent/ Guarantor)	Core Laboratories LP (Issuer)	Other Subsidiaries (Non- Guarantors)	Consolidating Adjustments	Consolidated Total

Net cash provided by operating activities			$ 14,287	$ 6,238	$ 4,915	$ -	$ 25,440
						-
CASH FLOWS FROM INVESTING ACTIVITIES:
	Capital expenditures		-	(3,636)	(1,982)	-	(5,618)
	Patents and other intangibles		-	(22)	(64)	-	(86)
	Proceeds from sale of assets		-	2,227	240	-	2,467
	Premiums on life insurance		-	(430)	-	-	(430)
Net cash used in investing activities			-	(1,861)	(1,806)	-	(3,667)

CASH FLOWS FROM FINANCING ACTIVITIES:
	Repayment of debt		(1,120)	(5,000)	-	-	(6,120)
	Proceeds from debt borrowings		-	5,000	-	-	5,000
	Capital lease obligations		-	-	(1)	-	(1)
	Stock options exercised		633	-	-	-	633
	Repurchase of common shares		(28,815)	-	-	-	(28,815)
	Excess tax benefit from stock-based payments		10,440	-	-	-	10,440
Net cash used in financing activities			(18,862)	-	(1)	-	(18,863)

NET CHANGE IN CASH AND CASH EQUIVALENTS			(4,575)	4,377	3,108	-	2,910
CASH AND CASH EQUIVALENTS, beginning of period			6,712	7,818	11,087	-	25,617
CASH AND CASH EQUIVALENTS, end of period			$ 2,137	$ 12,195	$ 14,195	$ -	$ 28,527

Condensed Consolidating Statements of Operations

		(In thousands)	Quarter Ended March 31, 2007
			Core Laboratories N.V. (Parent/ Guarantor)	Core Laboratories LP (Issuer)	Other Subsidiaries (Non- Guarantors)	Consolidating Adjustments	Consolidated Total
REVENUES
	Operating revenues		$ -	$ 29,987	$ 125,736	$ -	$ 155,723
	Intercompany revenues		260	4,510	18,380	(23,150)	-
	Earnings from consolidated affiliates		30,276	-	-	(30,276)	-
		Total revenues	30,536	34,497	144,116	(53,426)	155,723

OPERATING EXPENSES
	Operating costs		314	18,771	88,164	-	107,249
	General and administrative expenses		1,607	6,432	-	-	8,039
	Depreciation and amortization		-	1,301	3,277	-	4,578
	Other expense (income), net		45	1,852	20,380	(23,140)	(863)

Operating income			28,570	6,141	32,295	(30,286)	36,720
Interest expense			37	594	11	(10)	632

Income before income tax expense			28,533	5,547	32,284	(30,276)	36,088
Income tax expense (benefit)			3,271	3,325	4,230	-	10,826
NET INCOME			$ 25,262	$ 2,222	$ 28,054	$ (30,276)	$ 25,262

Condensed Consolidating Statements of Cash Flows

		(In thousands)	Quarter Ended March 31, 2007
			Core Laboratories N.V. (Parent/ Guarantor)	Core Laboratories LP (Issuer)	Other Subsidiaries (Non- Guarantors)	Consolidating Adjustments	Consolidated Total

Net cash provided by operating activities			$ 39,215	$ (18,249)	$ (1,808)	$ -	$ 19,158
						-
CASH FLOWS FROM INVESTING ACTIVITIES:
	Capital expenditures		-	(912)	(2,515)	-	(3,427)
	Patents and other intangibles			(9)	(36)	-	(45)
	Proceeds from sale of assets		-	2	74	-	76
	Premiums on life insurance		-	(764)	-	-	(764)
Net cash used in investing activities			-	(1,683)	(2,477)	-	(4,160)

CASH FLOWS FROM FINANCING ACTIVITIES:
	Repayment of debt		(982)	-	-	-	(982)
	Capital lease obligations		-	-	(1)	-	(1)
	Stock options exercised		16,918	-	-	-	16,918
	Repurchase of common shares		(58,624)	-	-	-	(58,624)
	Debt issuance costs		-	(152)	-	-	(152)
	Excess tax benefits from stock-based payments		2,609	-	-	-	2,609
Net cash used in financing activities			(40,079)	(152)	(1)	-	(40,232)

NET CHANGE IN CASH AND CASH EQUIVALENTS			(864)	(20,084)	(4,286)	-	(25,234)
CASH AND CASH EQUIVALENTS, beginning of period			1,572	35,385	17,266	-	54,223
CASH AND CASH EQUIVALENTS, end of period			$ 708	$ 15,301	$ 12,980	$ -	$ 28,989

12. RECENT ACCOUNTING PRONOUNCEMENTS

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141 (revised 2007), Business Combinations ("SFAS 141R") which replaces SFAS No.141, Business Combination. SFAS 141R retains the fundamental requirements of SFAS 141 that the acquisition method of accounting be used for all business combinations and for an acquirer to be identified for each business combination. In addition, SFAS 141R's scope is broader in that it applies to all transactions and other events in which one entity obtains control over one or more other businesses. SFAS 141R is effective on a prospective basis for all business combinations for which the acquisition date is on or after the beginning of the first annual period subsequent to December 15, 2008 and early adoption is not allowed. We are currently evaluating the effects that SFAS 141R may have on any future business combinations.

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 160, Noncontrolling Interests in Consolidated Financial Statements-an amendment of ARB No. 51 ("SFAS 160"). SFAS 160 requires companies with noncontrolling interests to disclose such interests clearly as a portion of equity separate from the parent's equity and the amount of consolidated net income attributable to these noncontrolling interests must also be clearly presented on the Consolidated Statement of Operations. In addition, when a subsidiary is deconsolidated, any retained noncontrolling equity investment in the former subsidiary will be initially measured at fair value and recorded as a gain or loss. SFAS 160 is effective for fiscal years beginning after December 15, 2008. We are currently evaluating the effects that SFAS 160 may have on our financial position and results of operations.

Return to Index

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion summarizes the financial position of Core Laboratories N.V. and its subsidiaries as of March 31, 2008 and should be read in conjunction with (i) the unaudited consolidated interim financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q and (ii) the consolidated financial statements and accompanying notes to our Annual Report on Form 10-K for the fiscal year ended December 31, 2007.

General

Core Laboratories N.V. is a Netherlands limited liability company. It was established in 1936 and is one of the world's leading providers of proprietary and patented reservoir description, production enhancement and reservoir management products and services to the oil and gas industry. These products and services can enable our clients to improve reservoir performance and increase oil and gas recovery from their producing fields. Core Laboratories N.V. has over 70 offices in more than 50 countries and employs approximately 4,900 people worldwide.

References to "Core Lab", "we", "our", and similar phrases are used throughout this Quarterly Report on Form 10-Q and relate collectively to Core Laboratories N.V. and its consolidated affiliates.

*	Reservoir Description: Encompasses the characterization of petroleum reservoir rock, fluid and gas samples. We provide analytical and field services to characterize properties of crude oil and petroleum products to the oil and gas industry.

*	Production Enhancement: Includes products and services relating to reservoir well completions, perforations, stimulations and production. We provide integrated services to evaluate the effectiveness of well completions and to develop solutions aimed at increasing the effectiveness of enhanced oil recovery projects.

*	Reservoir Management: Combines and integrates information from reservoir description and production enhancement services to increase production and improve recovery of oil and gas from our clients' reservoirs.

Cautionary Statement Regarding Forward Looking Statements

This quarterly report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Certain of the statements contained in this Management's Discussion and Analysis of Financial Condition and Results of Operations section, including those under the headings "Outlook" and "Liquidity and Capital Resources", and in other parts of this 10-Q, are forward looking. In addition, from time to time, we may publish forward-looking statements relating to such matters as anticipated financial performance, business prospects, technological developments, new products, research and development activities and similar matters. Forward-looking statements can be identified by the use of forward-looking terminology such as "may", "will", "believe", "expect", "anticipate", "estimate", "continue", or other similar words, including statements as to the intent, belief, or current expectations of our directors, officers, and management with respect to our future operations, performance, or positions or which contain other forward-looking information. These forward-looking statements are predictions. No assurances can be given that the future results indicated, whether expressed or implied, will be achieved. Our actual results may differ significantly from the results discussed in the forward-looking statements. While we believe that these statements are and will be accurate, a variety of factors could cause our actual results and experience to differ materially from the anticipated results or other expectations expressed in our statements. Such factors include, but are not limited to, the risks and uncertainties summarized below:

-

general and economic business conditions;

-

prices of oil and natural gas and industry expectations about future prices;

-

foreign exchange controls and currency fluctuations;

-

political stability in the countries in which we operate;

-

the business opportunities (or lack thereof) that may be presented to and pursued by us;

-

changes in laws or regulations; and

-

the validity of the assumptions used in the design of our disclosure controls and procedures.

Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in the forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For a more detailed discussion of some of the foregoing risks and uncertainties, see "Item 1A - Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2007, as well as the other reports and registration statements filed by us with the SEC.

Outlook

We continue our efforts to expand our market presence by opening facilities in strategic areas and realizing synergies within our business lines. We believe our market presence provides us a unique opportunity to service customers who have global operations in addition to the national oil companies.

We have established internal earnings targets that are based on current market conditions. Based on discussions with our clients and our view of the industry, we anticipate that in 2008 spending by our international clients will increase approximately 20% while we expect North American spending to be relatively flat. Attaining our internal targets is dependent on, among other things, oilfield activity sustained at current levels.

Results of Operations

Unaudited results of operations as a percentage of applicable revenue were as follows (in thousands):

	Three Months Ended March 31,				% Change
	2008		2007		2008/2007
REVENUES:
Service	$138,409	77%	$116,965	75%	18%
Product sale	41,028	23%	38,758	25%	6%
Total revenue	179,437	100%	155,723	100%	15%
OPERATING EXPENSES:
Cost of services*	91,159	66%	79,854	68%	14%
Cost of sales*	28,314	69%	27,395	71%	3%
Total cost of services and sales	119,473	67%	107,249	69%	11%
General and administrative expenses	8,289	5%	8,039	5%	3%
Depreciation and amortization	5,239	3%	4,578	3%	14%
Other expense (income), net	2,168	1%	(863)	(1%)	(351%)
Operating income	44,268	25%	36,720	24%	21%
Interest expense	644	-	632	-	2%
Income before income tax expense	43,624	24%	36,088	23%	21%
Income tax expense	14,291	8%	10,826	7%	32%
NET INCOME	$ 29,333	16%	$ 25,262	16%	16%

*Percentage based on applicable revenue rather than total revenue

Operating Results for the Three Months Ended March 31, 2008 Compared to the Three Months Ended March 31, 2007 (unaudited)

Service Revenues

Service revenues increased to $138.4 million for the first quarter of 2008, up 18% when compared to $117.0 million for the first quarter of 2007. This increase in revenue was largely attributable to an increase in worldwide oilfield activities, acceptance of recently introduced services by our customers and continued demand for our reservoir optimizing technologies in several North American projects related to oil sands, tight-gas sands, and shale reservoirs. The revenue growth was also driven, in part, by the continued expansion of our worldwide deepwater analysis projects.

Product Sale Revenues

Revenues associated with product sales increased to $41.0 million for the first quarter of 2008, up 6% from $38.8 million for the first quarter of 2007. This increase was primarily the result of continued market acceptance and penetration of new reservoir optimizing technologies introduced in 2007 coupled with the continued increase in drilling activity on a global basis, but more specifically for natural gas in the North American markets which resulted in higher demand for our well completion products.

Cost of Services

Cost of services expressed as a percentage of service revenue improved to 66% for the quarter ended March 31, 2008, down from 68% for the corresponding quarter in 2007. The decline in the cost of services relative to service revenue was primarily as a result of higher incremental margins earned on increased revenues over our relatively fixed cost structure. Incremental margins are calculated as the change in operating income divided by the change in revenues.

Cost of Sales

Cost of sales as a percentage of product sale revenues was 69% for the quarter ended March 31, 2008, which was an improvement from the 71% for the same period in 2007. The decrease in cost of sales as a percentage of product sale revenues for 2008 was primarily due to the growing demand for our new technologies which are our higher margin products, from an overall increase in sales, continued efforts to enhance our manufacturing efficiencies and improved inventory management.

General and Administrative Expenses

General and administrative expenses were relatively flat at $8.3 million for the first quarter of 2008 compared to $8.0 million for the first quarter of 2007.

Depreciation and Amortization Expense

Depreciation and amortization expense of $5.2 million for the first quarter of 2008 increased $0.6 million, from $4.6 million for the first quarter of 2007. This increase in depreciation and amortization expense was primarily due to an increase in capital expenditures as we continue to grow the company.

Other Expense (Income), Net

Other expense (income), net consisted of the following at March 31, 2008 and 2007 (in thousands):

	Three Months Ended March 31,
	2008	2007
	(Unaudited)
Minority interest	$ 103	$ (76)
Gain on sale of assets	(1,284)	(48)
Foreign exchange (gain) loss	(746)	18
Interest income	(108)	(411)
Non-income tax accrual	5,030	-
Other	(827)	(346)
Total other expense (income), net	$ 2,168	$ (863)

Foreign exchange (gains) losses by currency are summarized in the following table (in thousands):

	Three Months Ended March 31,
	2008	2007
	(Unaudited)
Canadian Dollar	$ 215	$ 106
Euro	(586)	(38)
Russian Ruble	(157)	(40)
Other currencies	(218)	(10)
Total (gain) loss	$ (746)	$ 18

Income Tax Expense

The effective tax rates for the first quarter of 2008 and 2007 were 32.8% and 30.0%, respectively.

Segment Analysis

Our operations are managed primarily in three complementary segments - Reservoir Description, Production Enhancement and Reservoir Management. The following table summarizes our results by operating segment for the quarters ended March 31, 2008 and 2007 (in thousands):

	Three Months Ended March 31,
	2008	2007
Revenues:	(Unaudited)
Reservoir Description	$ 100,501	$ 83,163
Production Enhancement	67,024	58,807
Reservoir Management	11,912	13,753
Consolidated	$ 179,437	$ 155,723

Operating income (loss):
Reservoir Description	$ 23,017	$ 16,773
Production Enhancement	21,941	16,052
Reservoir Management	4,227	3,697
Corporate and Other ¹	(4,917)	198
Consolidated	$ 44,268	$ 36,720

1) "Corporate and Other" represents those items that are not directly related to a particular segment.

Reservoir Description

Revenues from the Reservoir Description segment increased $17.3 million, to $100.5 million in the first quarter of 2008, compared to $83.2 million in the first quarter of 2007. The revenue increase resulted from unprecedented demand for our reservoir rock and especially for our reservoir fluids characterization services in the Middle East, Asia and Europe and our reservoir optimizing technologies in several North American projects related to the Canadian oil sands, tight gas sands and multiple gas-shale reservoirs. The revenue growth was also driven, in part, by the continued expansion of worldwide deepwater projects.

Operating income in the first quarter of 2008 increased by 37% or $6.2 million to $23.0 million compared to $16.8 million for the first quarter of 2007. Increases in operating income were primarily due to higher incremental margins earned from increased sales over our relatively fixed cost structure. Operating margins for the quarter ended March 31, 2008 were 23% compared to 20% for the same period in 2007.

Production Enhancement

Revenues from the Production Enhancement segment increased $8.2 million to $67.0 million in the first quarter of 2008 as compared to $58.8 million in the first quarter in 2007. The primary reason for the increase in our revenues in this segment has been the further improvement in market penetration and client acceptance of our well perforating and completion products and fracture diagnostic services.

Operating income in the first quarter of 2008 increased by 37% or $5.9 million to $21.9 million from $16.1 million for the first quarter of 2007. Operating margins increased to 33% in the first quarter of 2008 compared to 27% for the same period in 2007. These margin improvements were primarily due to increased market penetration of higher-margin services and products including new enhanced recovery technology, such as our SpectraScan™ and SpectraChem™ tracer service and our new SuperHERO™ perforating charges and gun systems.

Reservoir Management

Revenues from the Reservoir Management segment decreased $1.8 million in the first quarter of 2008 as compared to the first quarter of 2007. The decrease in revenue was a result of the culmination of several large projects in the first quarter of 2007.

Operating income in the first quarter of 2008 increased 14% to $4.2 million from $3.7 million for the first quarter of 2007. The increase was primarily due to the continued expansion of the multi-client reservoir study sales in the U.S. and new studies being performed including a gas-shale study focused in the Appalachian region and a study on tight gas sands in the Middle East region.

Liquidity and Capital Resources

General

We have historically financed our activities through cash on hand, cash flows from operations, bank credit facilities, or the issuance of debt and equity financing.

We utilize the non-GAAP financial measure of free cash flow to evaluate our cash flows and results of operations. Free cash flow is defined as net cash provided by operating activities (which is the most directly comparable GAAP measure) less capital expenditures. Management believes that free cash flow provides useful information to investors as it represents the cash, in excess of capital expenditures, available to operate the business and fund non-discretionary obligations. Free cash flow is not a measure of operating performance under GAAP, and should not be considered in isolation nor construed as an alternative to operating profit, net income (loss) or cash flows from operating, investing or financing activities, each as determined in accordance with GAAP. Moreover, since free cash flow is not a measure determined in accordance with GAAP and thus is susceptible to varying interpretations and calculations, free cash flow as presented, may not be comparable to similarly titled measures presented by other companies. The following table reconciles this non-GAAP financial measure to the most directly comparable measure calculated and presented in accordance with U.S. GAAP for the three month period ended March 31, 2008 and 2007 (in thousands):

	Three Months Ended March 31,
	2008	2007
Free cash flow calculation:	(unaudited)
Net cash provided by operating activities	$ 25,440	$ 19,158
Less: capital expenditures	5,618	3,427
Free cash flow	$ 19,822	$ 15,731

The increase in free cash flow in 2008 compared to 2007 was due to a higher net income partially offset by an increase in capital expenditures. Additionally, working capital, excluding cash, increased at a reduced rate in the first quarter of 2008 as compared to first quarter of 2007, and therefore had less of an impact on cash flow in the current year. At March 31, 2008 and December 31, 2007, we had working capital of $151.2 million and $122.7 million, respectively.

Cash Flows

The following table summarizes cash flows for the three months ended March 31, 2008 and 2007 (in thousands):

	Three Months Ended March 31,
	2008	2007
Cash provided by/(used in):	(unaudited)
Operating activities	$ 25,440	$ 19,158
Investing activities	(3,667)	(4,160)
Financing activities	(18,863)	(40,232)
Net change in cash and cash equivalents	$ 2,910	$ (25,234)

The increase in cash flows provided by operating activities was primarily attributable to an increase in net income along with a decrease in prepaid expenses and an increase in accrued liabilities and other long-term liabilities due to timing of payments.

The decrease in cash flows used in financing activities related primarily to the number of shares repurchased under our common share repurchase program. In the first three months of 2008, we repurchased 253,379 shares for an aggregate price of $28.8 million compared to 743,650 shares for an aggregate price of $58.6 million during the three months ended March 31, 2007. The decrease in cash flows used in financing activities was also attributable to a decrease in stock options exercised in 2008 as compared to 2007 of $16.3 million.

We maintain a revolving credit facility (the "Credit Facility") that allows for an aggregate borrowing capacity of $100.0 million. As amended, this facility provides an option to increase the commitment under the Credit Facility to $150.0 million, if certain conditions are met. The Credit Facility bears interest at variable rates from LIBOR plus 0.5% to a maximum of LIBOR plus 1.125%. Any outstanding balance under the Credit Facility is due in December 2010 when the Credit Facility matures. Interest payment terms are variable depending upon the specific type of borrowing under this facility. Our available capacity is reduced by outstanding unsecured letters of credit and performance guarantees and bonds totaling $11.6 million at March 31, 2008 relating to certain projects in progress. Our available borrowing capacity under the Credit Facility at March 31, 2008 was $88.4 million.

The terms of the Credit Facility require us to meet certain financial and operational covenants. We believe that we are in compliance with all such covenants at March 31, 2008. All of our material, wholly owned subsidiaries are guarantors or co-borrowers under the Credit Facility.

Our ability to maintain and grow our operating income and cash flow depends, to a large extent, on continued investing activities. We are a Netherlands holding company and substantially all of our operations are conducted through subsidiaries. Consequently, our cash flow depends upon the ability of our subsidiaries to pay cash dividends or otherwise distribute or advance funds to us. We believe our future cash flows from operations, supplemented by our borrowing capacity and issuances of additional equity should be sufficient to fund our debt requirements, capital expenditures, working capital, and future acquisitions.

Recent Accounting Pronouncements

Return to Index

Item 3. Quantitative and Qualitative Disclosures of Market Risk

There have been no material changes in market risk from the information provided in Item 7A. "Quantitative and Qualitative Disclosures About Market Risk" in our Annual Report on Form 10-K as of December 31, 2007.

Return to Index

Item 4. Controls and Procedures

A complete discussion of our controls and procedures is included in our Annual Report on Form 10-K for the year ended December 31, 2007.

Disclosure Controls and Procedures

Our management, under the supervision of and with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of Core Laboratories N.V.'s disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as of the end of the period covered by this report. Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by us in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of March 31, 2008 at the reasonable assurance level. Our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. Further, the design of disclosure controls and internal control over financial reporting must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Changes in Internal Control Over Financial Reporting

There have not been any changes in our internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our fiscal quarter ended March 31, 2008, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Return to Index

CORE LABORATORIES N.V.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

See Note 6 of Consolidated Interim Financial Statements in Part I, Item 1.

Return to Index

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information about purchases of equity securities that are registered by us pursuant to Section 12 of the Exchange Act during the quarter ended March 31, 2008:

Period	Total Number of Shares Purchased	Average Price Paid Per Share	Total Number of Shares Purchased as Part of a Publicly Announced Program	Maximum Number of Shares That May Yet be Purchased Under the Program
January 1-31, 2008	129,567	$ 113.86	129,567	1,189,812
February 1-29, 2008 (1)	120,036	$ 113.33	79,300	1,110,512
March 1-31, 2008 (2)	3,776	$ 121.60	-	1,110,512
Total	253,379	$ 113.72	208,867

(1) Contains 40,736 shares valued at $4.5 million, or $111.26 per share, surrendered to us by participants in a stock-based compensation plan to settle any personal tax liabilities which may result from the award in February 2008.

(2) Contains 3,776 shares valued at $0.5 million, or $121.60 per share, surrendered to us by participants in a stock-based compensation plan to settle any personal tax liabilities which may result from the award in March 2008.

Under Dutch law and our articles of association, and subject to certain Dutch statutory provisions, we may repurchase up to 10% of our issued share capital in open market purchases. In connection with our initial public offering in September 1995, our shareholders authorized our Management Board to make such repurchases for a period of 18 months. At each annual shareholders' meeting subsequent to 1995, our shareholders have renewed that authorization.

Return to Index

Item 6. Exhibits

Exhibit No.		Exhibit Title	Incorporated by reference from the following documents
3.1	-	Articles of Association of Core Laboratories N.V., as amended (including English translation)	Form F-1, September 20, 1995 (File No. 000-26710)
3.2	-	Amendments to the Articles of Association of Core Laboratories N.V.	Proxy Statement dated May 17, 2006 for Annual Meeting of Shareholders
10.1*	-	Form of Restated Employment Agreement between Core Laboratories N.V. and David Michael Demshur dated as of December 31, 2007	Filed herewith
10.2*	-	Form of Restated Employment Agreement between Core Laboratories N.V. and Richard Lucas Bergmark dated as of December 31, 2007	Filed herewith
10.3*	-	Form of Restated Employment Agreement between Core Laboratories N.V. and Monty Lee Davis dated as of December 31, 2007	Filed herewith
10.4*	-	Form of Restated Employment Agreement between Core Laboratories N.V. and John David Denson dated as of December 31, 2007	Filed herewith
10.5*	-	Amendment to Core Laboratories Supplement Executive Retirement Plan dated as of March 5, 2008	Filed herewith
10.6*	-	Amendment to Core Laboratories Supplemental Executive Retirement Plan for Monty L. Davis dated as of March 5, 2008	Filed herewith
10.7*	-	Amendment to Core Laboratories Supplemental Executive Retirement Plan for John D. Denson dated as of March 5, 2008	Filed herewith
31.1	-	Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith
31.2	-	Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Filed herewith
32.1	-	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Furnished herewith
32.2	-	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	Furnished herewith

	*	Management contract or compensatory plan or arrangement

Return to Index

SIGNATURE

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

		CORE LABORATORIES N.V.
		By:	Core Laboratories International B.V., its
			Managing Director

Date:	May 8, 2008	By:	/s/ Richard L. Bergmark
			Richard L. Bergmark
			Chief Financial Officer
			Duly Authorized Officer and
			Principal Financial Officer

Return to Index

Employment Agreement

(Restated as of December 31, 2007)

THIS EMPLOYMENT AGREEMENT (this " Agreement ") is made by and between CORE LABORATORIES N.V. and David M. Demshur (" Executive ").

W I T N E S S E T H :

WHEREAS , Executive is currently an employee of Core Laboratories N.V. and/or one or more of its Affiliates (" Company "); and

WHEREAS , the Company desires to continue to employ Executive on the terms and conditions, and for the consideration, hereinafter set forth, and Executive is desirous of continuing to be employed by Company on such terms and conditions, and for such consideration;

NOW, THEREFORE , for and in consideration of the amounts and benefits to be paid and provided to Executive under this Agreement and the mutual promises, covenants, and undertakings contained herein, Core Laboratories N.V. and Executive, each intending to be legally bound, hereby agree as follows:

I.

Employment and Duties

1.1 Employment; Effective Date . Company agrees to employ Executive, and Executive agrees to be employed by Company, beginning as of the Effective Date and continuing for the period of time set forth in Article III of this Agreement, subject to the terms and conditions of this Agreement.

1.2 Position . From and after the Effective Date, Company shall employ Executive in the position of Chief Executive Officer of Company, or in such other comparable executive position as Company and Executive may mutually agree.

1.3 Duties and Services . Executive agrees to serve in the position referred to in Section 1.2 and to perform diligently and to the best of Executive's abilities the duties and services appertaining to such office, as well as such additional duties and services appropriate to such office upon which the parties mutually may agree from time to time. Executive's employment shall also be subject to the policies maintained and established by Company, as the same may be amended from time to time.

1.4 Other Interests . Executive agrees, during the period of Executive's employment by Company, to devote Executive's primary business time, energy, and best efforts to the business and affairs of Company and its Affiliates and not to engage, directly or indirectly, in any other business or businesses, whether or not similar to that of Company, except with the consent of the Board of Directors. The foregoing notwithstanding, the parties recognize and agree that Executive may, without consent of the Board of Directors, engage in charitable, civic, and other business activities that do not conflict with the business and affairs of Company and in passive personal investments, so long as such activities do not interfere with Executive's performance of Executive's duties hereunder.

1.5 Duty of Loyalty . Executive acknowledges and agrees that Executive owes a fiduciary duty of loyalty, fidelity, and allegiance to act at all times in the best interests of Company. In keeping with these duties, Executive shall make full disclosure to Company of all business opportunities pertaining to Company's business and shall not appropriate for Executive's own benefit business opportunities concerning the subject matter of the fiduciary relationship.

II.

Compensation and Benefits

2.1 #9; Base Salary . During the period of this Agreement, Executive shall receive a minimum annual base salary of $625,000. Executive's annual base salary shall be reviewed by the Board of Directors (or a committee thereof) on an annual basis, and, in the sole discretion of the Board of Directors (or such committee), such annual base salary may be increased, but not decreased no less than once every calendar year. Executive's annual base salary shall be paid in equal installments in accordance with the Company's standard policy regarding payment of compensation to executives but no less frequently than monthly.

2.2 Bonuses . Executive shall be eligible to receive an annual bonus of up to 150% of Executive's annual base salary with the amount of such bonus to be determined by the Committee based upon criteria established from time to time by the Committee.

2.3 Employee Benefits . Executive and, to the extent applicable, Executive's spouse, dependents, and beneficiaries shall be allowed to participate in all benefits, plans, and programs, including improvements or modifications of the same, which are now, or may hereafter be, available to other executive employees of Company (or such Affiliate at whose offices Executive spends a majority of his working time, as the case may be). Such benefits, plans, and programs shall include, without limitation, any deferred compensation plan, matching share program, performance share program, profit sharing plan, thrift plan, health insurance or health care plan, life insurance (including any available supplemental insurance), disability insurance (including any available supplemental insurance), pension plan, supplemental retirement plan, stock option plan, vacation and sick leave plan, and the like which may be maintained by Company (or such Affiliate, as the case may be) for Executive specifically or for employees of Executive's seniority and position generally. Company shall not, however, by reason of this Section be obligated to institute, maintain, or refrain from changing, amending, or discontinuing, any such benefit, plan, or program, so long as such changes are similarly applicable to executive employees specifically, and no worse than all other employees generally; provided, however, that in the case of any discontinuation of any such benefit, plan or program, Company shall continue to provide such benefit or coverage through one or more individual insurance plan(s) paid for by Company or be self funded by the Company with comparable individual benefits or coverage at its expense.

2.4 Business and Entertainment Expenses . During his employment hereunder, subject to Company's standard policies and procedures with respect to expense reimbursement as applied to its executive employees generally, Company shall reimburse Executive for, or pay on behalf of Executive, reasonable and appropriate expenses incurred by Executive for business-related purposes, including, but not limited to, dues and fees to industry and professional organizations and costs of entertainment and business development.

2.5 Indemnification . Company agrees to indemnify Executive against any and all liabilities arising out of Executive's employment duties to the extent such liabilities are not covered by any insurance maintained by Company or Executive, including any liabilities that are caused by or result from an act or omission constituting the negligence of Executive in the performance of such duties, but excluding liabilities that are caused by or result from Executive's own gross negligence or willful misconduct.

III.

Term and Termination of Employment

3.1 Term . Unless sooner terminated pursuant to other provisions hereof, Company agrees to employ Executive for the period beginning on the Effective Date and ending on the third anniversary of the Effective Date. Said term of employment shall be extended automatically for an additional successive three-year period as of each annual anniversary date of the Effective Date that occurs while this Agreement is in effect; provided, however, that if, at any time prior to any such anniversary date of the Effective Date, either party shall give written notice to the other that no such automatic extension shall occur, then Executive's employment shall terminate on the last day of the three-year period beginning on the annual anniversary date of the Effective Date that next occurs after such notice is given.

3.2 Company's Right to Terminate . Notwithstanding the provisions of Section 3.1, Company shall have the right to terminate Executive's employment under this Agreement at any time for any of the following reasons:

(i) Upon Executive's death;

(ii) Upon Executive's becoming incapacitated by accident, sickness, or other circumstance that renders Executive mentally or physically incapable of performing the duties and services required of Executive hereunder on a full-time basis for a period of at least 180 consecutive calendar days;

(iii) For Cause;

(iv) For Executive's material breach of any material provision of this Agreement which, if correctable, remains uncorrected for thirty days following written notice to Executive by Company of such breach; or

(v) For any other reason whatsoever, in the sole discretion of the Board of Directors.

3.3 Executive's Right to Terminate . Notwithstanding the provisions of Section 3.1, Executive shall have the right to terminate Executive's employment under this Agreement at any time for any of the following reasons:

(i) A material breach by Company of any material provision of this Agreement which, if correctable, remains uncorrected for thirty days following written notice of such breach by Executive to Company;

(ii) For Good Reason; or

(iii) For any other reason whatsoever, in the sole discretion of Executive.

3.4 Notice of Termination . If Company or Executive desires to terminate Executive's employment hereunder at any time prior to expiration of the term of employment as provided in Section 3.1, Company or Executive shall do so by giving written notice of such termination to the other party and stating the effective date and reason for such termination; provided, however, that no such action shall alter or amend any other provisions hereof or rights arising hereunder, including, without limitation, the provisions of Articles V and VI hereof. For all purposes of this Agreement, Executive shall be considered to have terminated employment with Company when Executive incurs a "separation from service" with Company within the meaning of Section 409A(a)(2)(A)(i) of the Code and applicable administrative guidance issued thereunder.

IV.

Effect of Termination of Employment

4.1 Termination By Expiration of Term . If Executive's employment hereunder shall terminate upon expiration of the term provided in Section 3.1 hereof, all compensation and all benefits to Executive hereunder shall terminate contemporaneously with termination of Executive's employment, except for such benefits as may be required by law.

4.2 Termination By Company . If Executive's employment hereunder shall be terminated by Company prior to expiration of the term provided in Section 3.1, regardless of the reason therefor, all compensation and benefits to Executive hereunder shall terminate contemporaneously with the termination of such employment; provided, however, that if such termination shall be for any reason other than those encompassed by Section 3.2(i), 3.2(ii), 3.2(iii), or 3.2(iv), Company shall (i) pay Executive a Termination Payment and (ii) provide Executive with Severance Benefits; provided further, however, that if termination is pursuant to Section 3.2(i) or 3.2(ii), the Company will provide Employee's spouse and dependent children with the benefits covered under Section 8.1(15)(iv); and provided further that all outstanding stock options granted by Company to Executive shall immediately become fully vested and immediately exercisable in full as provided under Section 8.1(15)(ii). The Termination Payment described in the preceding sentence shall be paid by Company to Executive within thirty days after the last day of Executive's employment with Company; provided, however, that, if required to satisfy the provisions of Section 409A(a)(2)(B)(i) of the Code, the portion of the Termination Payment that is in excess of the Grandfathered Severance Amount (with interest on such portion from the date of Executive's termination of employment to the actual date of payment at the prime rate of interest published in The Wall Street Journal on the date of termination of Executive's employment (or if not published on that date, on the next following date when published) (the " Section 409A Interest Rate ")) shall be paid by Company to Executive not earlier than but as soon as practicable on or in any event within five days after the earlier of the date of Executive's death or the date that is six (6) months after the date of termination of Executive's employment (the " Section 409A Payment Date "). Executive hereby agrees to be bound by Company's determination of its "specified employees" (as such term is defined in Section 409A of the Code) in accordance with any of the methods permitted under the regulations issued under Section 409A of the Code.

4.3 Termination By Executive . If Executive's employment hereunder shall be terminated by Executive prior to expiration of the term provided in Section 3.1, regardless of the reason therefor, all compensation and benefits to Executive hereunder shall terminate contemporaneously with the termination of such employment; provided, however, that Company shall (i) pay Executive a Termination Payment and (ii) provide Executive with Severance Benefits. The Termination Payment described in the preceding sentence shall be paid by Company to Executive within thirty days after the last day of Executive's employment with Company; provided, however, that, if required to satisfy the provisions of Section 409A(a)(2)(B)(i) of the Code, the portion of the Termination Payment that is in excess of the Grandfathered Severance Amount (with interest on such portion from the date of Executive's termination of employment to the actual date of payment at the Section 409A Interest Rate) shall be paid by Company to Executive not earlier than but as soon as practicable on or in any event within five days after the Section 409A Payment Date.

&# 4.4 Change in Control . If, within three (3) years following the occurrence of a Change in Control, Executive's employment with Company shall terminate for any reason, then, in lieu of any Termination Payment or Severance Benefits pursuant to Section 4.2 or 4.3, Company shall (1) pay Executive a Change in Control Payment and (2) provide Executive with Change in Control Benefits. The Change in Control Payment described in the preceding sentence shall be paid by Company to Executive within thirty days after the last day of Executive's employment with Company; provided, however, that, if required to satisfy the provisions of Section 409A(a)(2)(B)(i) of the Code, the portion of the Termination Payment that is in excess of the Grandfathered Severance Amount (with interest on such portion from the date of Executive's termination of employment to the actual date of payment at the Section 409A Interest Rate) shall be paid by Company to Executive not earlier than but as soon as practicable on or in any event within five days after the Section 409A Payment Date.

4.5 Parachute Payment Gross Up . Notwithstanding anything to the contrary in this Agreement, in the event that any payment or distribution by the Company to or for the benefit of Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a " Payment "), would be subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties with respect to such excise tax (such excise tax, together with any such interest or penalties, are hereinafter collectively referred to as the " Excise Tax "), Company shall pay to Executive an additional payment (a " Gross-up Payment ") in an amount such that after payment by Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including any Excise Tax imposed on any Gross-up Payment, Executive retains an amount of the Gross-up Payment equal to the Excise Tax imposed upon the Payments. The Gross-up Payment attributable to a particular Payment shall be made at the time such Payment is made; provided, however, that in no event shall the Gross-up Payment be made later than the end of Executive's taxable year next following Executive's taxable year in which Executive remits the related taxes. Executive shall notify Company in writing of any claim by the Internal Revenue Service which, if successful, would require Company to make a Gross-up Payment (or a Gross-up Payment in excess of that, if any, initially determined by Company) within ten days of the receipt of such claim. Company shall notify Executive in writing at least ten days prior to the due date of any response required with respect to such claim if it plans to contest the claim. If Company decides to contest such claim, Executive shall cooperate fully with Company in such action; provided, however, Company shall bear and pay directly or indirectly all costs and expenses (including additional interest and penalties) incurred in connection with such action and shall indemnify and hold Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including interest and penalties with respect thereto, imposed as a result of Company's action. If, as a result of Company's action with respect to a claim, Executive receives a refund of any amount paid by Company with respect to such claim, Executive shall promptly pay such refund to Company. If Company fails to timely notify Executive whether it will contest such claim, or if Company determines not to contest such claim, Company shall immediately pay to Executive the portion of such claim, if any, which it has not previously paid to Executive. All determinations required to be made under this Section 4.5, including, without limitation, whether and when a Gross-up Payment is required and the amount of such Gross-up Payment and the assumptions to be utilized in arriving at such determination, shall be made by the independent public accounting firm used by Company immediately prior to the Change in Control for purposes of preparing Company's audited financial statements. However, in the event such accounting firm is also serving as an accountant or auditor for the individual, entity or group effecting the Change in Control, Executive may appoint another nationally recognized accounting firm to make the determinations required hereunder.

4.6 #9; No Duty to Mitigate Losses . Executive shall have no duty to find new employment following the termination of Executive's employment under circumstances that require Company to pay any amount to Executive pursuant to this Article IV. Any salary or remuneration received by Executive from a third party for the providing of personal services (whether by employment or by functioning as an independent contractor) following the termination of Executive's employment under circumstances pursuant to which this Article IV apply shall not reduce Company's obligation to make a payment to Executive (or the amount of any such payment) pursuant to the terms of this Article IV.

4.7 Liquidated Damages . In light of the difficulties in estimating the damages for an early termination of this Agreement, Company and Executive hereby agree that the payments, if any, to be received by Executive pursuant to this Article IV shall be received by Executive as liquidated damages and not as a penalty.

4.8 Other Compensation Programs . This Agreement governs the rights and obligations of Executive and Company with respect to Executive's annual base salary and certain perquisites of employment. Executive's rights and obligations both during the term of Executive's employment and thereafter with respect to stock options, restricted stock, incentive and deferred compensation, life insurance policies insuring the life of Executive, and other benefits under plans and programs maintained by Company shall be governed by the separate agreements, plans, programs, and other documents and instruments governing such matters, or as may be provided by law.

V.

Protection of Information

5.1 Disclosure to Executive . Company shall (i) disclose to Executive, or place Executive in a position to have access to or develop, trade secrets or confidential information of Company or its Affiliates, and/or (ii) entrust Executive with business opportunities of Company or its Affiliates, and/or (iii) place Executive in a position to develop business good will on behalf of Company or its Affiliates.

5.2 Disclosure to and Property of Company . All information, ideas, concepts, improvements, discoveries, and inventions, whether patentable or not, which are conceived, made, developed, or acquired by Executive, individually or in conjunction with others, during Executive's employment by Company (whether during business hours or otherwise and whether on Company's premises or otherwise) that relate to Company's business, products, or services (including, without limitation, all such information relating to corporate opportunities, research, financial and sales data, pricing terms, evaluations, opinions, interpretations, acquisitions prospects, the identity of customers or their requirements, the identity of key contacts within the customer's organizations or within the organization of acquisition prospects, or marketing and merchandising techniques, prospective names, and marks) shall be disclosed to Company and are and shall be the sole and exclusive property of Company. Moreover, all documents, drawings, memoranda, notes, records, files, correspondence, manuals, models, specifications, computer programs, E-mail, voice mail, electronic databases, maps, and all other writings or materials of any type embodying any of such information, ideas, concepts, improvements, discoveries, and inventions are and shall be the sole and exclusive property of Company. Upon termination of Executive's employment by Company, for any reason, Executive promptly shall deliver the same, and all copies thereof, to Company.

5.3 No Unauthorized or Damaging Use or Disclosure . Executive will not, at any time during or after Executive's employment by Company, make any unauthorized disclosure of any confidential business information or trade secrets of Company or its Affiliates, or make any use thereof, except in the carrying out of Executive's employment responsibilities hereunder. Affiliates of the Company shall be third party beneficiaries of Executive's obligations under this Section. As a result of Executive's employment by Company, Executive may also from time to time have access to, or knowledge of, confidential business information or trade secrets of third parties, such as customers, suppliers, partners, joint venturers, and the like, of Company and its Affiliates. Executive also agrees to preserve and protect the confidentiality of such third party confidential information and trade secrets to the same extent, and on the same basis, as Company's confidential business information and trade secrets. Executive shall refrain, both during the employment relationship and after the employment relationship terminates, from publishing any oral or written statements about Company, any of its Affiliates, or any of such entities' officers, employees, agents, or representatives (i) that are slanderous, libelous, or defamatory, or (ii) that disclose private or confidential information about Company, any of its Affiliates, or any of such entities' business affairs, officers, employees, agents, or representatives, or (iii) that constitute an intrusion into the seclusion or private lives of Company, any of its Affiliates, or any of such entities' officers, employees, agents, or representatives, or (iv) that give rise to unreasonable publicity about the private lives of Company, any of its Affiliates, or any of such entities' officers, employees, agents, or representatives, or (v) that place Company, any of its Affiliates, or any of such entities' officers, employees, agents, or representatives in a false light before the public, or (vi) that constitute a misappropriation of the name or likeness of Company, any of its Affiliates, or any of such entities' officers, employees, agents, or representatives. A violation or threatened violation of this prohibition may be enjoined by the courts.

5.4 Ownership by Company . If, during Executive's employment by Company, Executive creates any work of authorship fixed in any tangible medium of expression, which is the subject matter of copyright (such as videotapes, written presentations, or acquisitions, computer programs, E-mail, voice mail, electronic databases, drawings, maps, architectural renditions, models, manuals, brochures, or the like) relating to Company's business, products, or services, whether such work is created solely by Executive or jointly with others (whether during business hours or otherwise and whether on Company's premises or otherwise), Company shall be deemed the author of such work if the work is prepared by Executive in the scope of Executive's employment; or, if the work is not prepared by Executive within the scope of Executive's employment but is specially ordered by Company as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, or as an instructional text, then the work shall be considered to be work made for hire and Company shall be the author of the work. If such work is neither prepared by Executive within the scope of Executive's employment nor a work specially ordered that is deemed to be a work made for hire, then Executive hereby agrees to assign, and by these presents does assign, to Company all of Executive's worldwide right, title, and interest in and to such work and all rights of copyright therein.

5.5 Assistance by Executive . Both during the period of Executive's employment by Company and thereafter, Executive shall assist Company and its nominee, at any time, in the protection of Company's worldwide right, title, and interest in and to information, ideas, concepts, improvements, discoveries, and inventions, and its copyrighted works, including without limitation, the execution of all formal assignment documents requested by Company or its nominee and the execution of all lawful oaths and applications for patents and registration of copyright in the United States and foreign countries.

5.6 Remedies . Executive acknowledges that money damages would not be sufficient remedy for any breach of this Article by Executive, and Company shall be entitled to enforce the provisions of this Article by terminating any and all payments then owing to Executive under this Agreement and/or to specific performance and injunctive relief as remedies for such breach or any threatened breach. Such remedies shall not be deemed the exclusive remedies for a breach of this Article, but shall be in addition to all remedies available at law or in equity to Company, including the recovery of damages from Executive and his agents involved in such breach and remedies available to Company pursuant to other agreements with Executive.

VI.

Noncompetition Obligation

6.1 In General . As part of the consideration for the compensation and benefits to be paid to Executive hereunder; to protect the trade secrets and confidential information of Company and its Affiliates that have been and will in the future be disclosed or entrusted to Executive, the business good will of Company and its Affiliates that has been and will in the future be developed in Executive, or the business opportunities that have been and will in the future be disclosed or entrusted to Executive by Company and its Affiliates; and, as an additional incentive for Company to enter into this Agreement, Company and Executive agree to the noncompetition obligations hereunder. Executive shall not, directly or indirectly for Executive or for others, in any geographic area or market where Company or any of its Affiliates are conducting any business as of the date of the termination of the employment relationship or have during the previous twelve months conducted such business:

(i) Engage in any business competitive with the business conducted by Company;

(ii) Provide comparable services to any other person, association, or entity who is primarily engaged in any business competitive with the business conducted by Company with respect to such competitive business; or

(iii) Induce any employee of Company or any of its Affiliates to terminate his or her employment with Company or such Affiliates, or hire or assist in the hiring of any such employee by any person, association, or entity not affiliated with Company.

The restrictions placed on Executive by this Section 6.1 shall apply during the period that Executive is employed by Company and for the two-year period thereafter if Executive's employment with Company is terminated for any reason other than (a) by Executive for a Good Reason or (b) by Company without Cause. Notwithstanding the foregoing, from and after the date upon which a Change in Control occurs, such restrictions shall cease to apply to Executive except for any period during which he is employed by Company.

6.2 Enforcement and Remedies . Executive understands that the restrictions set forth in Section 6.1 may limit Executive's ability to engage in certain businesses anywhere in the world during the period provided for above, but acknowledges that Executive will receive sufficiently high remuneration and other benefits under this Agreement to justify such restriction. Executive acknowledges that money damages would not be sufficient remedy for any breach of this Article by Executive, and Company shall be entitled to enforce the provisions of this Article by terminating any payments then owing to Executive under this Agreement and/or to specific performance and injunctive relief as remedies for such breach or any threatened breach. Such remedies shall not be deemed the exclusive remedies for a breach of this Article, but shall be in addition to all remedies available at law or in equity to Company, including without limitation, the recovery of damages from Executive and Executive's agents involved in such breach and remedies available to Company pursuant to other agreements with Executive.

6.3 Reformation . It is expressly understood and agreed that Company and Executive consider the restrictions contained in this Article to be reasonable and necessary to protect the proprietary information of Company. Nevertheless, if any of the aforesaid restrictions are found by a court having jurisdiction to be unreasonable, or overly broad as to geographic area or time, or otherwise unenforceable, the parties intend for the restrictions therein set forth to be modified by such court so as to be reasonable and enforceable and, as so modified by the court, to be fully enforced.

VII.

Miscellaneous

7.1 Notices . For purposes of this Agreement, notices and all other communications provided for herein shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by United States registered or certified mail, return receipt requested, postage prepaid, addressed as follows:

If to Company to: Core Laboratories N.V.

Herengracht 424

1017 BZ Amsterdam

The Netherlands

Attention: Managing Director

cc : General Counsel

Core Laboratories, Inc.

6316 Windfern

Houston, Texas 77040

If to Executive to: David M. Demshur

c/o 6316 Windfern

Houston, Texas 77040

or to such other address as either party may furnish to the other in writing in accordance herewith, except that notices or changes of address shall be effective only upon receipt.

7.2 Applicable Law . This Agreement is entered into under, and shall be governed for all purposes by, the laws of the state of Texas, except as may be preempted by federal law.

7.3 No Waiver . No failure by either party hereto at any time to give notice of any breach by the other party of, or to require compliance with, any condition or provision of this Agreement shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

7.4 Severability . If a court of competent jurisdiction determines that any provision of this Agreement is invalid or unenforceable, then the invalidity or unenforceability of that provision shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect.

7.5 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 Agreement.

7.6 Withholding of Taxes and Other Employee Deductions . Company may withhold from any benefits and payments made pursuant to this Agreement all federal, state, city, and other taxes as may be required pursuant to any law or governmental regulation or ruling and all other normal employee deductions made with respect to Company's employees generally.

7.7 Headings . The Article and Section headings herein have been inserted for purposes of convenience only and shall not be used for interpretive purposes.

7.8 Gender and Plurals . Wherever the context so requires, the masculine gender includes the feminine or neuter, and the singular number includes the plural and conversely.

7.9 Assignment . This Agreement shall be binding upon and inure to the benefit of Company and any successor of Company, by merger or otherwise. Except as provided in the preceding sentence, this Agreement, and the rights and obligations of the parties hereunder, are personal and neither this Agreement, nor any right, benefit, or obligation of either party hereto shall be subject to voluntary or involuntary assignment, alienation, or transfer, whether by operation of law or otherwise, without the prior written consent of the other party.

7.10 Term . This Agreement has a term co-extensive with the term of employment provided in Section 3.1. Termination shall not affect any right or obligation of any party which is accrued or vested prior to such termination. Without limiting the scope of the preceding sentence, the provisions of Articles V and VI shall survive any termination of the employment relationship and/or of this Agreement.

7.11 Entire Agreement . This Agreement constitutes the entire agreement of the parties with regard to the subject matter hereof, and contains all the covenants, promises, representations, warranties, and agreements between the parties with respect to employment of Executive by Company. Without limiting the scope of the preceding sentence, all prior understandings and agreements among the parties hereto relating to the subject matter hereof (including, without limitation, the Prior Employment Agreement) are hereby null and void and of no further force and effect. Any modification of this Agreement will be effective only if it is in writing and signed by the party to be charged.

7.12 Legal Fees and Expenses . It is the intent of Company that Executive not be required to bear any legal fees or related expenses associated with the interpretation, enforcement or defense of Executive's rights under this Agreement (by litigation or otherwise) with respect to any termination of his employment on or after a Change in Control. Accordingly, if it should appear to Executive that Company has failed to comply with any of its obligations under this Agreement or in the event that Company or any other person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or proceeding designed to deny, or to recover from, Executive any benefit provided or intended to be provided to Executive hereunder, in each case with respect to his rights or obligations upon or following a termination of his employment on or after a Change in Control, then Company irrevocably authorizes the Executive from time to time to retain counsel of Executive's choice, at the expense of Company, to advise and represent Executive in connection with any such interpretation, enforcement or defense, including, without limitation, the initiation or defense of any litigation or other legal action, whether by or against Company or any director, officer, stockholder or other person affiliated with Company, in any jurisdiction. Notwithstanding any existing or prior attorney-client relationship between Company and such counsel, Company irrevocably consents to Executive entering into an attorney-client relationship with such counsel, and in that connection Company and Executive agree that a confidential relationship will exist between Executive and such counsel. Without regard to whether Executive prevails, in whole or in part, in connection with any of the foregoing, Company will pay and be solely financially responsible for any and all attorneys' fees and related expenses incurred by Executive in connection with any of the foregoing, except to the extent that a final judgment no longer subject to appeal finds that a claim or defense asserted by Executive was frivolous. In such a case, the portion of such fees and expenses incurred by Executive attributable to such frivolous claim or defense shall become Executive's sole responsibility and any funds advanced by Company with respect to the same shall be promptly returned to Company by Executive without interest. Any reimbursement of attorneys' fees and related expenses required under this Section 7.12 shall be made by Company upon or as soon as practicable following receipt of supporting documentation reasonably satisfactory to Company (but in any event not later than the close of Executive's taxable year following the taxable year in which the fee or expense is incurred by Executive); provided, however, that, upon Executive's termination of employment with Company, in no event shall any additional reimbursement be made prior to the date that is six months after the date of Executive's termination of employment to the extent such payment delay is required under Section 409A(a)(2)(B)(i) of the Code. In no event shall any reimbursement be made to Executive for such fees and disbursements incurred after the later of (i) Executive's death or (ii) the date that is ten years after the date of Executive's termination of employment with Company.

VIII.

Definitions

8.1 Definitions . Where the following words and phrases appear in this Agreement, each shall have the respective meaning set forth below, unless the context clearly indicates to the contrary.

(1) " Affiliate " shall mean any entity that owns or controls, is owned or controlled by, or is under common ownership or control with, Core Laboratories N.V.

(2) " Board of Directors " shall mean the Board of Supervisory Directors of Core Laboratories N.V.

(3) " Cause " shall mean Executive has been convicted of any felony or a misdemeanor involving moral turpitude.

(4) " Change in Control " shall mean (i) a merger of Company with another entity, a consolidation involving Company, or the sale of all or substantially all of the assets of Company to another entity if, in any such case, (A) the holders of equity securities of Company immediately prior to such transaction or event do not beneficially own immediately after such transaction or event, in substantially the same proportions that they owned the equity securities of Company immediately prior to such transaction or event, 50% or more of the common equity of the resulting entity, (B) the holders of equity securities of Company immediately prior to such transaction or event do not beneficially own immediately after such transaction or event, in substantially the same proportions that they owned the equity securities of Company immediately prior to such transaction or event, equity securities of the resulting entity entitled to 50% or more of the votes then eligible to be cast in the election of directors generally (or comparable governing body) of the resulting entity, or (C) the persons who were members of the Board of Directors immediately prior to such transaction or event shall not constitute at least a majority of the board of directors of the resulting entity immediately after such transaction or event, (ii) shareholder approval of a plan of dissolution or liquidation of Company, (iii) when any person or entity, including a "group" as contemplated by Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the " Exchange Act "), (other than a trustee or other fiduciary holding securities under an employee benefit plan of Company or any affiliate of Company), acquires or gains ownership or control (including, without limitation, power to vote) of more than 30% of the combined voting power of the outstanding securities of, (A) if Company has not engaged in a merger or consolidation, Company, or (B) if Company has engaged in a merger or consolidation, the resulting entity, or (iv) a change in the composition of the Board of Directors, as a result of which fewer than a majority of the supervisory directors are Incumbent Directors. For purposes of the preceding sentence, (1) "resulting entity" in the context of a transaction or event that is a merger, consolidation or sale of all or substantially all assets shall mean the surviving entity (or acquiring entity in the case of an asset sale) unless the surviving entity (or acquiring entity in the case of an asset sale) is a subsidiary of another entity and the holders of common equity of Company receive capital stock of such other entity in such transaction or event, in which event the resulting entity shall be such other entity, (2) subsequent to the consummation of a merger or consolidation that does not constitute a Change in Control, the term "Company" shall refer to the resulting entity and the term "Board of Directors" shall refer to the board of directors (or comparable governing body) of the resulting entity, and (3) "Incumbent Directors" shall mean directors who either (A) are directors of Company as of February 28, 2003, or (B) are elected, or nominated for election, to the Board of Directors with the affirmative votes of at least two-thirds of the Incumbent Directors at the time of such election or nomination, but Incumbent Director shall not include an individual whose election or nomination occurs as a result of either (A) an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or (B) an actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board of Directors. For purposes of this Section 8.1(4), all references to "Company" shall refer solely to Core Laboratories N.V. except as expressly provided in clause (2) of the preceding sentence.

(5) " Change in Control Benefits " shall mean all of the following:

(i) Continued coverage under Company's medical, dental, and group life insurance plans (or, as the case may be, those plans of the Affiliate at whose offices Executive spends a majority of his working time) shall be provided for Executive and those of Executive's dependents (including Executive's spouse) who were covered under such plans on the day prior to Executive's termination of employment with Company for thirty-six months from the date of such termination at no cost to Executive or Executive's dependents; provided, however, that (1) such coverage shall be subject to all of the terms and conditions of such plans, including, without limitation, the eligibility provisions, (2) such coverage shall terminate if and to the extent Executive or Executive's dependents become covered by the medical, dental, and life insurance plans of a subsequent employer (and any such coverage shall be promptly reported to Company by Executive), (3) if Executive (and/or Executive's spouse) would have been entitled to retiree medical, dental, and/or life insurance coverage under Company's plans (or such Affiliate's plans, as the case may be) had Executive voluntarily retired on the date of such termination, then such coverages shall be continued as provided under such plans, and (4) in the event that continued participation in any such Company plan (or such Affiliate's plan, as the case may be) is not permitted by the terms of such plan, Company shall use its best efforts to arrange, upon comparable terms, benefits substantially equivalent to those that were provided under such Company plan (or such Affiliate's plan, as the case may be). The medical and dental coverage described in the preceding sentence shall be provided through an arrangement that satisfies the requirements of Sections 105 and 106 of the Code such that the benefits or reimbursements under such arrangement are not includible in Executive's income (and, if continued coverage under Company's plans (or such Affiliate's plans, as the case may be) does not satisfy this requirement, then Company shall arrange, upon comparable terms, for coverage providing substantially equivalent benefits to be provided under one or more insurance policies that will satisfy this requirement).

(ii) All of the outstanding stock options granted by Company to Executive shall become fully vested and immediately exercisable in full upon Executive's termination of employment and shall remain exercisable for a period of 12 months thereafter (three months thereafter in the case of Grandfathered Options) or for such greater period as may be provided in the plan or plans pursuant to which any such stock options were granted (but in no event shall any such stock option be exercisable after the earlier of the expiration of the original term of such stock option or the 10 ^th anniversary of the original date of grant of such stock option). For purposes of the preceding sentence, the term "Grandfathered Options" means (1) each stock option granted by Company to Executive on or before February 28, 2003, with respect to which the purchase price per share under such stock option is less than the Fair Market Value (as such term is defined in the Core Laboratories N.V. 1995 Long-Term Incentive Plan, as amended) per share as of February 28, 2003 and (2) each other stock option granted by Company to Executive on or before February 28, 2003, that qualifies as an incentive stock option (within the meaning of Section 422 of the Code) and which would cease to qualify as such an incentive stock option if the period during which such stock option could be exercised after termination of employment was extended from three months to 12 months as provided in the preceding sentence.

(iii) Company shall provide Executive with reasonable outplacement services at a cost not to exceed 100% of Executive's annual base salary as in effect pursuant to Section 2.1 immediately prior to Executive's termination of employment with Company; provided, however, that such outplacement services shall in no event be provided beyond the last day of the second taxable year of Executive following the taxable year of Executive in which Executive's termination of employment with Company occurred.

(iv) Notwithstanding the coverage therefor under any other provision hereof including clause (i) above, (provided that in no case shall this subsection require Company to provide duplicative benefits coverage under its own programs), Executive shall be provided a benefits package (for so long as Executive or Executive's spouse or dependent children shall live) including medical, hospital, dental, disability and life insurance plans and coverage (including supplemental insurance plans and coverage) for Executive and Executive's spouse and dependent children at least as favorable (including premium payments no higher than the lowest employee cost of such coverage) to Executive (and Executive's spouse and/or dependent children) as those provided immediately prior to termination unless, with respect to any particular plan or coverage, the continuation of such existing plan or coverage would have material adverse financial or regulatory consequences for the Company, in which case the plan or coverage will be provided through one or more individual insurance plan(s) paid for by Company or be self funded by the Company with comparable individual coverage at its expense. If the receipt of any benefit or payment under this clause (iv) (" Benefit ") is taxable to Executive, then Company shall pay to Executive, within 60 days after the end of each taxable year of Executive, an additional amount in cash (" Additional Payment ") equal to all taxes (including any interest or penalties imposed with respect to such taxes) Executive incurs with respect to such Benefit for such taxable year and any Additional Payment received by Executive during such taxable year. The medical, hospital and dental coverage described in the first sentence of this clause (iv) shall be provided through an arrangement that satisfies the requirements of Sections 105 and 106 of the Code such that the benefits or reimbursements under such arrangement are not includible in Executive's income (and, if continued coverage under Company's plans (or an Affiliate's plans, as the case may be) does not satisfy this requirement, then Company shall arrange, upon comparable terms, for coverage providing substantially equivalent benefits to be provided under one or more insurance policies that will satisfy this requirement).

(6) " Change in Control Payment " shall mean a lump sum payment in an amount equal to three times the sum of (i) Executive's annual base salary as in effect pursuant to Section 2.1 immediately prior to Executive's termination of employment with Company and (ii) the greater of (x) the highest annual bonus earned by Executive during any of the last three fiscal years of Company ending prior to the Change in Control, and (y) 45% of the maximum annual incentive bonus amount pursuant to Section 2.2 that Executive could have earned for the year during which Executive's employment with Company terminates.

(7) " Code " shall mean the Internal Revenue Code of 1986, as amended.

(8) " Committee " shall mean the Compensation Committee of the Board of Directors.

(9) " Company " shall mean Core Laboratories N.V. and its Affiliates.

(10) " Effective Date " shall mean August 1, 2007.

(11) " Executive " shall mean David M. Demshur.

(12) " Good Reason " shall mean termination by Executive of Executive's employment with Company within sixty days of and in connection with or due to (i) a significant change in the nature, status, or scope of Executive's duties, responsibilities, or authorities, (ii) a permanent change and relocation of Executive's principal place of employment with Company, which is more than fifty miles away from the prior location, (iii) a material breach by Company of any material provision of this Agreement which, if correctable, remains uncorrected for thirty days following written notice of such breach by Executive to Company, (iv) a material diminution in Executive's participation in bonus, stock option, incentive award, and other compensation plans provided by Company for executives with comparable duties, (v) a materia l diminution in employee benefits (including but not limited to medical, dental, life insurance, and long-term disability plans) and perquisites applicable to Executive from the employee benefits and perquisites provided by Company to executives with comparable duties, or (vi) in Executive's sole judgment, the scope of Executive's position or continued employment within Company being no longer appropriate.

(13) " Grandfathered Severance Amount " shall mean $1,474,000, which amount is equal to the "Termination Payment" that Executive would have received pursuant to the terms of the Prior Employment Agreement if Executive had voluntarily terminated his employment with the Company (for any reason whatsoever or for no reason) on December 31, 2004.

(14) " Prior Employment Agreement " shall mean that certain Employment Agreement between Core Laboratories N.V. and Executive that was restated as of December 31, 2001, as amended.

(15) " Severance Benefits " shall mean all of the following:

(i) Continued coverage under Company's medical, dental, and group life insurance plans (or, as the case may be, those of the Affiliate at whose offices Executive spends a majority of his working time) shall be provided for Executive and those of Executive's dependents (including Executive's spouse) who were covered under such plans on the day prior to Executive's termination of employment with Company for thirty-six months from the date of such termination at no cost to Executive or Executive's dependents; provided, however, that (1) such coverage shall be subject to all of the terms and conditions of such plans, including, without limitation, eligibility provisions, (2) such coverage shall terminate if and to the extent Executive or Executive's dependents become covered by the medical, dental, and life insurance plans of a subsequent employer (and any such coverage shall be promptly reported to Company by Executive), (3) if Executive (and/or Executive's spouse) would have been entitled to retiree medical, dental, and/or life insurance coverage under Company's plans (or such Affiliate's plans, as the case may be) had Executive voluntarily retired on the date of such termination, then such coverages shall be continued as provided under such plans), and (4) in the event that continued participation in any such Company plan is not permitted by the terms of such plan, Company shall use its best efforts to arrange, upon comparable terms, benefits substantially equivalent to those that were provided under such Company plan (or such Affiliate's plan, as the case may be). The medical and dental coverage described in the preceding sentence shall be provided through an arrangement that satisfies the requirements of Sections 105 and 106 of the Code such that the benefits or reimbursements under such arrangement are not includible in Executive's income (and, if continued coverage under Company's plans (or such Affiliate's plans, as the case may be) does not satisfy this requirement, then Company shall arrange, upon comparable terms, for coverage providing substantially equivalent benefits to be provided under one or more insurance policies that will satisfy this requirement).

(ii) All of the outstanding stock options granted by Company to Executive shall become fully vested and immediately exercisable in full upon Executive's termination of employment and for a period of three months thereafter or for such greater period as may be provided in the plan or plans pursuant to which such stock options were granted (but in no event shall any such stock option be exercisable after the earlier of the expiration of the original term of such stock option or the 10th anniversary of the original date of grant of such stock option).

(iv) Notwithstanding the coverage therefor under any other provision hereof including clause (i) above, (provided that in no case shall this subsection require Company to provide duplicative benefits coverage under its own programs), Executive shall be provided a benefits package (for so long as Executive or Executive's spouse or dependent children shall live) including medical, hospital, dental, disability and life insurance plans and coverage (including supplemental insurance plans and coverage) for Executive and Executive's spouse and dependent children at least as favorable (including premium payments no higher than the lowest employee cost of such coverage) to Executive (and Executive's spouse and/or dependent children) as those provided immediately prior to termination unless, with respect to any particular plan or coverage, the continuation of such existing plan or coverage would have material adverse financial or regulatory consequences for the Company, in which case the plan or coverage will be provided through one or more individual insurance plan(s) paid for by Company or be self funded by the Company with comparable individual coverage at its expense. The medical, hospital and dental coverage described in the preceding sentence shall be provided through an arrangement that satisfies the requirements of Sections 105 and 106 of the Code such that the benefits or reimbursements under such arrangement are not includible in Executive's income (and, if continued coverage under Company's plans (or an Affiliate's plans, as the case may be) does not satisfy this requirement, then Company shall arrange, upon comparable terms, for coverage providing substantially equivalent benefits to be provided under one or more insurance policies that will satisfy this requirement).

(16) " Termination Payment " shall mean a lump sum payment in an amount equal to the sum of (i) 200% of Executive's annual base salary as in effect pursuant to Section 2.1 immediately prior to Executive's termination of employment with Company and (ii) two times 45% of the maximum annual incentive bonus amount pursuant to Section 2.2 that Executive could have earned for the year during which Executive's employment with Company terminates.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the 5 ^th day of March, 2008, to be effective as of the Effective Date.

CORE LABORATORIES N.V.

By Core Laboratories International B.V.,

its sole managing director

By: /s/ JAN WILLEM SODDERLAND

Jan Willem Sodderland

Managing Director of

Core Laboratories International B.V.

EXECUTIVE

/s/ David M. Demshur

David M. Demshur

Houston 3332780v1

Employment Agreement

(Restated as of December 31, 2007)

THIS EMPLOYMENT AGREEMENT (this " Agreement ") is made by and between CORE LABORATORIES N.V. and Richard L. Bergmark (" Executive ").

W I T N E S S E T H :

WHEREAS , Executive is currently an employee of Core Laboratories N.V. and/or one or more of its Affiliates (" Company "); and

I.

Employment and Duties

1.2 Position . From and after the Effective Date, Company shall employ Executive in the position of Chief Financial Officer of Company, or in such other comparable executive position as Company and Executive may mutually agree.

II.

Compensation and Benefits

2.1 #9; Base Salary . During the period of this Agreement, Executive shall receive a minimum annual base salary of $380,000. Executive's annual base salary shall be reviewed by the Board of Directors (or a committee thereof) on an annual basis, and, in the sole discretion of the Board of Directors (or such committee), such annual base salary may be increased, but not decreased no less than once every calendar year. Executive's annual base salary shall be paid in equal installments in accordance with the Company's standard policy regarding payment of compensation to executives but no less frequently than monthly.

2.2 Bonuses . Executive shall be eligible to receive an annual bonus of up to 100% of Executive's annual base salary with the amount of such bonus to be determined by the Committee based upon criteria established from time to time by the Committee.

III.

Term and Termination of Employment

(i) Upon Executive's death;

(iii) For Cause;

(v) For any other reason whatsoever, in the sole discretion of the Board of Directors.

(ii) For Good Reason; or

(iii) For any other reason whatsoever, in the sole discretion of Executive.

IV.

Effect of Termination of Employment

V.

Protection of Information

VI.

Noncompetition Obligation

(i) Engage in any business competitive with the business conducted by Company;

VII.

Miscellaneous

If to Company to: Core Laboratories N.V.

Herengracht 424

1017 BZ Amsterdam

The Netherlands

Attention: Managing Director

cc : General Counsel

Core Laboratories, Inc.

6316 Windfern

Houston, Texas 77040

If to Executive to: Richard L. Bergmark