FIRST AMENDMENT TO THIRD AMENDED AND RESTATED LOAN AGREEMENT

 

**           THIS FIRST AMENDMENT TO THIRD AMENDED AND RESTATED LOAN AGREEMENT** is datedand effective as of March 31, 2001 (the "First Amendment"), among **OMNIENERGY SERVICES CORP**., a Louisiana corporation (the "Borrower"), **AmericanAviation L.L.C.**, a Missouri limited liability company("Aviation"), **OMNI ENERGY SERVICES CANADA CORP**., an Alberta,Canada corporation formerly known as Hamilton Drill Tech Inc. ("OmniCanada"), **OMNI ENERGY SERVICES-ALASKA, INC**., an Alaska corporation("Omni Alaska"; Aviation, Omni Canada, and Omni Alaska are hereincollectively called the "Guarantor"), and **HIBERNIA NATIONAL BANK**,a national banking association (the "Bank").

RECITAL

           1.             TheBorrower, each Guarantor, and the Bank have heretofore entered into that certainThird Amended and Restated Loan Agreement dated as of October 30, 2000("Loan Agreement"), pursuant to which the Bank established in favor ofthe Borrower certain credit facilities consisting of an Amortizing Term Loan andRevolving Loans;

           2.             TheLoans by the Bank to the Borrower are guaranteed, in solido, by Aviation,Omni Canada, and Omni Alaska as the Guarantors;

           3.             TheBorrower, with the consent of the Guarantors, has agreed to make a $2,000,000.00pay-down on the Amortizing Term Loan.

           4.             Inconnection with the aforementioned pay-down, the Borrower, with the consent ofeach Guarantor, has requested that the Bank (i) waive certain Advance Ratereductions, (ii) restructure all subsequent Advance Rates, (iii) revise thedefinition of Qualified Receivables, (iv) extend the Termination Date fromJanuary 31, 2002 to August 31, 2002, (v) reduce the Applicable Margin from 3.0%to 1.50%, and (vi) make certain other changes to the Loan Agreement; and

           5.            Subject to the terms and conditions of the Loan Agreement, as amended by thisFirst Amendment, the Bank is willing to honor the Borrower's requests.

           NOW, THEREFORE, the parties hereto, in consideration of the mutual covenantshereinafter set forth and intending to be legally bound hereby, agree asfollows:

           A. **  **         **DefinedTerms.** Capitalized terms used herein which are defined in the Loan Agreementare used herein with such defined meanings, except as may be expressly set forthin this First Amendment.

           B. **  **         **DefinedTerms Revision.**                       (1)    The definition of the term "Advance Rate" appearing in        Section 1.1. of the Loan Agreement is hereby deleted and replaced with        the following: **"Advance Rate" shall mean            the following: The Advance Rate is a fixed percentage that will            reduce over time. In the event the Borrower does not receive            proceeds from that certain New York Life Insurance Policy No. 46 859            506 on the life of David A. Jeansonne prior to May 31, 2001, then            the Advance Rate will be as follows:

(a) from the date of the First Amendment through            May 31, 2001, the Advance Rate will be 50%;

(b) for the month of June 2001, the Advance Rate            will be 40%;

(c) for the month of July 2001, the Advance Rate            will be 30%;

(d) for the month of August 2001, the Advance            Rate will be 20%;

(e) for the month of September 2001, the Advance            Rate will be 10%; and
            (f) for the month of October 2001 and thereafter, the Advance Rate will          be 0.00%.          
In the event the Borrower receives proceeds from that        certain New York Life Insurance Policy No. 46 859 506 on the life of        David A. Jeansonne prior to May 31, 2001, then the Advance Rates set        forth in (a) through (f) above shall not apply. Instead, the Advance        Rate will be as follows:

(g) from the date of the First Amendment through the day on which the          Borrower receives the said life insurance proceeds (the "Receipt          Period"), the Advance Rate will be 50%;
            (h) commencing on the first day of the month after the Receipt Period          and continuing through the end of that month (the "Second          Period"), the Advance Rate will be 40%;            
(i) commencing on the first day of the month after the Second Period and          continuing until the last day of such month (the "Third          Period"), the Advance Rate will be 30%;            
(j) commencing on the first day of the month after the Third Period and          continuing until the last day of such month (the "Fourth          Period"), the Advance Rate will be 20%;            
(k) commencing on the first day of the month after the Fourth Period and          continuing until the last day of such month (the "Fifth          Period"), the Advance Rate will be 10%; and          
(l) commencing on the first day of the month            after the Fifth Period and continuing thereafter, the Advance Rate            will be 0.00%.

                       (2)     The definition of the term "Amortizing TermNote" appearing in Section 1.1. of the Loan Agreement is hereby deleted andreplaced with the following:

"**Amortizing Term Note**" shall            mean that certain promissory note of even date with the First            Amendment by Borrower in the principal amount of $4,919,611.00,            payable to the order of the Bank with interest at the Base Rate plus            the Applicable Margin, together with all renewals, extensions, and            refinancing of said indebtedness. The Amortizing Term Note            constitutes a renewal and restructure of that certain promissory            note by Borrower dated October 30, 2000 in the principal amount of            $7,466,111.00 payable to the order of Bank.

                       (3)     The definition of the term "Applicable Margin"appearing in Section 1.1. of the Loan Agreement is hereby deleted and replacedwith the following:
**"Applicable Margin" shall mean 1.50%.

                       (4)     The term "Qualified Receivables", as defined inthe Loan Agreement, has historically meant eighty percent (80%) of theReceivables of the Borrower and/or the Guarantor. In order to revise temporarilythe percentage of Receivables to be used in calculating Qualified Receivables,the definition of the term "Qualified Receivables" appearing inSection 1.1. of the Loan Agreement is hereby deleted and replaced with thefollowing:
**"Qualified Receivables"            shall mean a fixed percentage (as set forth below) of the            Receivables of the Borrower and/or the Guarantor, carried on their            respective books of account, which, on the date as of which the            determination is made, (a) are subject to a first priority            perfected Encumbrance in favor of the Bank, (b) arose in the            ordinary course of business of the Borrower and/or the Guarantor,            (c) arose from the sale of goods or performance of services by the            Borrower and/or the Guarantor, (d) are evidenced by an            "invoice" (i.e., an invoice, shipping order or            similar writing), (e) are not subject to setoff, counterclaim,            defense, or a dispute of any kind or nature, (f) are not more            than 90 days old, (g) are payable by Persons other than any Person            who is an affiliate (as defined in accordance with GAAP) of the            Borrower and/or the Guarantor or an officer or director of the            Borrower and/or the Guarantor or an officer or director of an            affiliate of the Borrower and/or the Guarantor, (h) are not payable            by the United States of America or any agency or department thereof            (unless such Receivable has been assigned to the Bank pursuant to a            properly perfected assignment under the Federal Assignment of Claims            Act, 31 U.S.C. § 3727), (i) do not by their own terms prohibit the            collateral assignment thereof or require the consent of the obligor            thereon to any collateral assignment thereof, (j) do not arise out            of a transaction with an account debtor outside the United States of            America (unless covered by a letter of credit acceptable to the            Bank), (k) are not Receivables due by a Person from whom over 50% of            its entire accounts receivable balance with the Borrower or the            Guarantor is unpaid for more than 90 days past the invoice date(s)            related thereto, (l) are not credit balances, (m) are not            Receivables which the Bank believes, in its sole credit judgment            reasonably applied, that collection of such Receivables is insecure            or that such Receivables may not be paid by reason of the account            debtor's financial inability to pay or that such Receivables are            otherwise unacceptable collateral, (n) are not that portion of the            Receivables due by a single Person which are in excess of 25% of all            of the Receivables due to the Borrower and/or the Guarantor, (o)            commencing 90 days from the date hereof, are owed by a Person who            has either signed an acceptance of the work giving rise to the            Receivable or signed an acceptance of the proposal for work giving            rise to the Receivable, and (p) Receivables that have been sold,            assigned or factored to another entity. For purposes of this            Agreement, a Receivable is 90 days old on the 90th day after the            date of the invoice evidencing such Receivable (regardless of the            due date of such invoice). The fixed percentage of Receivables shall            be: (i) from the date of the First Amendment through May 31, 2001,            or through the date on which the Borrower receives proceeds from            that certain New York Life Insurance Policy No. 46 859 506 on the            life of David A. Jeansonne, whichever occurs first, the fixed            percentage shall be eighty-five percent (85%); and (ii) thereafter,            the fixed percentage shall be eighty percent (80%).

                       (5)     The definition of the term "Termination Date"appearing in Section 1.1. of the Loan Agreement is hereby deleted and replacedwith the following:
**"Termination Date" shall mean, with            respect to the Bank's Commitment the earlier to occur of (i) August            31, 2002, or (ii) the date of termination of the Commitment pursuant            to Article XII hereof.

 

                       (6)     The following new definition is hereby added to Section1.1. of the Loan Agreement:
**"First Amendment" shall mean            that certain First Amendment to Third Amended and Restated Loan            Agreement dated as of March 31, 2001 by and among the Borrower,            Aviation, Omni Canada, Omni Alaska, and the Bank.

               C.            **Revisions to Article III (Term Loan)**
                       1.     Section 3.1. of the Loan Agreement is hereby deleted andrestated as follows:
**Section 3.1. The Amortizing Term Loan.        Subject to the terms, conditions and provisions of the Agreement, as        amended by the First Amendment, the Bank agrees to renew the Amortizing        Term Loan to the Borrower, which Amortizing Term Loan shall constitute a        renewal and restructure of the indebtedness evidenced by the promissory        note of Borrower dated October 30, 2000 in the principal amount of        $7,466,111.00.

 

                       2.     Section 3.2. of the Loan Agreement is hereby deleted andrestated as follows:

**Section 3.2. The Amortizing Term Note.**        The Borrower's indebtedness to the Bank pursuant to the Amortizing Term        Loan shall be evidenced by the Amortizing Term Note. The Amortizing Term        Note shall be due and payable as follows: (i) in monthly principal        payments of $100,000.00 each payable on the last day of each month        commencing April 30, 2001, and continuing through the Termination Date;        and (ii) in weekly installments of accrued unpaid interest, payable on        Monday of each week and on the Termination Date; provided, however, if        the Borrower's Debt to EBITDA ratio is equal to or less than 5:00 to 1.0        (and such ratio is maintained), then Borrower will be permitted to make        monthly payments of accrued unpaid interest.

           D.            **Revision to Article V (Fees)**. Article V of the LoanAgreement is hereby amended and supplemented to include the following new andadditional fee:
**Section 5.4. Upfront Fee. In        consideration of the Bank's agreement to enter into the First Amendment,        the Borrower shall pay the Bank, upon execution of the First Amendment        by the Borrower, a fee equal to 0.50% of the $9,919,611, which fee        amount is $49,598.00.

           E.             **Revisions to Affirmative Covenants.**
                       1.     Section 10.1 (g) of the Loan Agreement is hereby deletedand restated as follows:

(g) within fifteen (15) days following the end of        each calendar month, on a weekly basis, each time the Borrower submits a        Request for Advance, and at any other time upon the request by the Bank,        a borrowing base certificate showing the Borrower's total Receivables,        minus ineligibles, total Qualified Receivables, in form and substance        acceptable to the Bank, accompanied by such supporting documents as may        be required by the Bank, with the Borrower's borrowing base certificate        to be certified by the chief financial officer of the Borrower,

                       2.     Section 10.1. of the Loan Agreement is hereby amended andsupplemented to include the following new provision as subparagraph (j):

(j) on a weekly basis a cash needs report in        substantially the same form as submitted to the Bank prior to the date        of the First Amendment.

                       3.     Section 10.9. (a) of the Loan Agreement is hereby deletedand replaced with the following:

(a) **Minimum EBITDA**. The Borrower shall            maintain a minimum EBITDA on a cumulative basis as follows:
****Quarter Ended ****Minimum EBITDA**3/31/01 $ 16/30/01 $ 500,0009/30/01 $1,000,00012/31/01  $1,750,0003/31/02 $2,500,0006/30/02 $3,000,000
                       4.     Section 10.9 (b) of the Loan Agreement is hereby deletedand replaced with the following:

(b) **Maximum Debt to EBITDA.** The Borrower            shall maintain a maximum Debt to EBITDA ratio on a cumulative basis            as follows:
****Quarter Ended ****Minimum EBITDA**3/31/0111:16/30/0110:19/30/01  8:112/31/01   5:13/31/02  5:16/30/02  4:1
           F. **   **        **Revision to Negative Covenants.** Section 11.7 of theLoan Agreement is hereby deleted.

          G. **   **        **Revision to Events of Default.** Section 12.1. of theLoan Agreement is hereby amended and supplemented to include the following newand additional Event of Default:
**Change in Executive Management. Any change in the                    executive management of the Borrower.

           H. **   **        **Confirmation of Collateral Documents.** All of theliens, privileges, priorities and equities existing and to exist under and inaccordance with the terms of the Collateral Documents are hereby renewed,extended and carried forward as security for all of the Loans and all otherdebts, obligations and liabilities of the Borrower to the Bank. Further, theGuarantors hereby consent to the terms and conditions of this First Amendment,and confirm their solidary liability for all Loans.

           I. **   **        **Covenants and Conditions Precedent.** The agreementsand obligations of the Bank as set forth in this First Amendment are subject tosatisfaction of the following covenants and conditions precedent as of the dateof execution of this First Amendment and the continued satisfaction of saidcovenants and conditions precedent:
****
                   (1)     The Borrower and each Guarantor shall have executed anddelivered to the Bank this First Amendment, the Borrower shall have executed therenewal promissory note evidencing the renewed Amortizing Term Note, and theBorrower shall have executed an allonge to the Revolving Note, all in form andsubstance satisfactory to the Bank;

                   (2)     The representations, warranties, and covenants of theBorrower and the Guarantors as set forth in the Loan Agreement, as amended bythis First Amendment, or in any Related Document furnished to the Bank inconnection herewith, shall be and remain true and correct;

                   (3)     The Bank shall have received certified resolutions of theBorrower and the Guarantors authorizing the execution of all documents andinstruments contemplated by this First Amendment;

                    (4)    There shall have occurred no Default and/or Material Adverse Change;

                   (5)     The Borrower shall have paid to the Bank's counsel,Liskow & Lewis, the sum of $12,856.11 for outstanding legal fees; and

                    (6)     In addition to the foregoing, the following conditionsprecedent must be satisfied by the Borrower upon execution of this FirstAmendment, and satisfactory evidence thereof must be delivered to the Bank:

(i)

Borrower shall deliver to Bank the sum of                $2,000,000.00 for applications to the Amortizing Term Loan                (prior to the renewal thereof as set forth in this First                Amendment), resulting in a principal reduction of the existing                Amortizing Term Note, from $6,919,611 to $4,919,611;

(ii)

Advantage Capital Group shall have                released (or the Borrower shall have paid) all outstanding                indebtedness owed by the Borrower to the Advantage Capital                Group, and the Advantage Capital Group shall have released and                terminated its second lien on Borrower's and Guarantor's assets;

(iii)

There shall exist no Subordinated Debt;

(iv)

The Borrower shall have not less than                $1,000,000 in working capital (as defined in Section 10.9. (c)                of the Loan Agreement); and

(v)
           
All outstanding interest, fees and                expenses due Bank under the Loan Agreement, as amended by this                First Amendment, shall be paid to Bank by Borrower.

Bank reserves the right, in its sole discretion, to waive inwriting compliance with any of the foregoing conditions and covenants. Aviolation of any of the foregoing conditions and covenants shall constitute anEvent of Default.

           J. **   **        **Representation.** On and as of the date hereof, andafter giving effect to this First Amendment, the Borrower and each Guarantorconfirm, reaffirm and restate the representations and warranties set forth inthe Loan Agreement and the Collateral Documents; provided, that each referenceto the Loan Agreement herein shall be deemed to include the Loan Agreement asamended by this First Amendment.

           K.             **Warrants.** The Borrower hereby confirms the optionin favor of Bank to purchase 4,545 shares of stock issued by Borrower at astrike price of $1.50 per share. The term of the option shall last until January31, 2002; provided, however, any extension of the Termination Date(as defined in the Loan Agreement) by Bank and Borrower shall also act as anextension of the term of the said option.

           L.             **Payment of Expenses.** The Borrower agrees to pay orreimburse the Bank for all legal fees and expenses of counsel to the Bank inconnection with the transactions contemplated by this First Amendment.
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           M.** **           **WAIVER OF DEFENSES; RELEASE OF LIABILITIES. INCONSIDERATION OF THE BANK'S EXECUTION OF THIS FIRST AMENDMENT, THE BORROWER ANDTHE GUARANTORS DO HEREBY IRREVOCABLY WAIVE ANY AND ALL CLAIMS, CAUSES OF ACTION,AND/OR DEFENSES TO PAYMENT ON ANY INDEBTEDNESS OWED BY ANY OF THEM TO THE BANKTHAT MAY EXIST AS OF THE DATE OF EXECUTION OF THIS FIRST AMENDMENT. FURTHER,BORROWER AND THE GUARANTORS HEREBY AGREE THAT ALL DISPUTES AND CLAIMS WHATSOEVEROF ANY KIND OR NATURE WHICH BORROWER AND/OR ANY OF THE GUARANTORS PRESENTLY HASOR MAY HAVE AGAINST BANK, WHETHER PRESENTLY KNOWN OR UNKNOWN, WHICH BORROWERAND/OR ANY OF THE GUARANTORS COULD HAVE ASSERTED AGAINST BANK, ARE FULLY ANDFINALLY RELEASED, COMPROMISED AND SETTLED. BORROWER AND THE GUARANTORS,INDIVIDUALLY AND FOR THEMSELVES, THEIR, SUCCESSORS IN INTEREST AND ASSIGNS, DOHEREBY EXPRESSLY RELEASE AND FOREVER RELIEVE, DISCHARGE AND GRANT FULLACQUITTANCE TO BANK FOR AND FROM ANY AND ALL CAUSES OF ACTION, SUITS, CLAIMS,DEBTS, OBLIGATIONS OR LIABILITIES OF ANY NATURE WHATSOEVER, KNOWN OR UNKNOWN,ALLEGED OR NOT ALLEGED, WHICH BORROWER AND/OR ANY OF THE GUARANTORS HAS OR MAYHAVE AGAINST BANK, ITS AGENTS, OFFICERS, EMPLOYEES, DIRECTORS AND SHAREHOLDERSAS OF THE DATE HEREOF. ACCEPTANCE OF THE PROCEEDS OF EACH REVOLVING LOAN AFTERTHE DATE HEREOF SHALL CONSTITUTE A RATIFICATION, ADOPTION AND CONFIRMATION BYBORROWER AND GUARANTORS OF THE FOREGOING GENERAL RELEASE OF RELEASED CLAIMS ANDLIABILITIES THAT ARE BASED IN WHOLE OR IN PART ON FACTS, WHETHER OR NOT KNOWN ORUNKNOWN, EXISTING ON OR PRIOR TO THE DATE OF RECEIPT OF ANY SUCH REVOLVING LOAN.THIS WAIVER AND RELEASE SHALL BE CONSTRUED TO HAVE THE BROADEST POSSIBLE SCOPE.**
           N.             **Amendments. THE LOAN AGREEMENT AND THIS FIRST AMENDMENTARE CREDIT OR LOAN AGREEMENTS AS DESCRIBED IN LA. R.S. 6:§1121, ET SEQ. THEREARE NO ORAL AGREEMENTS BETWEEN THE BANK, THE BORROWER, OMNI ALASKA, AVIATION,AND OMNI CANADA. THE LOAN AGREEMENT, AS AMENDED BY THIS FIRST AMENDMENT, SETSFORTH THE ENTIRE AGREEMENT OF THE PARTIES WITH RESPECT TO THE SUBJECT MATTERHEREOF AND SUPERSEDES ALL PRIOR WRITTEN AND ORAL UNDERSTANDINGS BETWEEN THEBORROWER, AVIATION, OMNI ALASKA, OMNI CANADA AND THE BANK, WITH RESPECT TO THEMATTERS HEREIN SET FORTH. THE LOAN AGREEMENT, AS AMENDED BY THIS FIRSTAMENDMENT, MAY NOT BE MODIFIED OR AMENDED EXCEPT BY A WRITING SIGNED ANDDELIVERED BY THE BORROWER, AVIATION, OMNI ALASKA, OMNI CANADA AND THE BANK.**

           O.             **Governing Law: Counterparts.** This First Amendmentshall be governed by and construed in accordance with the laws of the State ofLouisiana. This First Amendment may be executed in any number of counterparts,all of which counterparts, when taken together, shall constitute one and thesame instrument.

             P.             **Continued Effect.** Except as expressly modifiedherein, the Loan Agreement shall continue in full force and effect. The LoanAgreement as amended by this First Amendment is hereby ratified and confirmed bythe parties hereto.

 
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**           IN WITNESS WHEREOF,** the parties hereto have causedthis First Amendment to be executed and delivered as of the date hereinaboveprovided by the authorized officers each hereunto duly authorized.

**OMNI ENERGY SERVICES CORP.**

By:

Name: Burton T. Zaunbrecher

Title: Vice President and Chief                        Operating Officer

**AMERICAN AVIATION L.L.C.**

**By: Omni Energy Services Corp.,**

**as Sole Member**

By:

Name: Burton T. Zaunbrecher

Title: Vice President and Chief                        Operating Officer

**OMNI ENERGY SERVICES CANADA CORP.**

**(f/k/a HAMILTON DRILL TECH INC.)**

By:

Name: Burton T. Zaunbrecher

Title: Vice President and Chief                        Operating Officer

**OMNI ENERGY SERVICES - ALASKA, INC.**

By:

Name: Burton T. Zaunbrecher

Title: Vice President and Chief                        Operating Officer

**HIBERNIA NATIONAL BANK**

By:

Name: Tammy M. Angelety

Title: Vice President********************