Document:

_

Exhibit 10.4

 

FIRST
AMENDED AND RESTATED

EMPLOYMENT AGREEMENT

 

AGREEMENT made and entered into as of
July 14, 2005 and amended and restated October 19, 2005, by and between SEITEL
INC., a Delaware corporation (together with its successors and assigns, the
"Company"), and William Restrepo (the "Executive").

 

W I T N E S S E T H

 

WHEREAS, the Company desires to employ
the Executive and to enter into an agreement embodying the terms of such
employment (this "Agreement") and the Executive desires to enter into this
Agreement and to accept such employment, subject to the terms and provisions of
this Agreement;

 

NOW, THEREFORE, in consideration of the
premises and mutual covenants contained herein and for other good and valuable
consideration, the receipt of which is mutually acknowledged, the Company and
the Executive (individually a "Party" and together the "Parties") agree as
follows:

 

	
    1.
	
    
    Definitions.

     

	 	(a)	
    "Affiliate" of a specified person
    or entity shall mean a person or entity that, directly or indirectly,
    controls, is controlled by, or is under common control with, the person or
    entity specified.  For the purposes of the term "Affiliate," control
    with respect to a Person, means the possession, directly or indirectly, of
    the power to (i) vote 10% or more of
the securities having ordinary voting power for the election of directors (or
comparable positions of such Person) or (ii) direct or cause the direction of the
management and policies of such Person, whether through voting of securities,
by contract, or otherwise, and the terms controlling and controlled have
meanings correlative to the foregoing.

     

	 	(b)	
    "Base Salary" shall mean the annualized salary provided
    for in Section 4 below.

     

	 	(c)	
    "Beneficial Owner" shall have the meaning ascribed to
    such term in Rule 13d-3 under the Securities Exchange Act of 1934 and any
    successor to such Rule.  

     

	 	(d)	
    "Board" shall mean the Board of Directors of the Company.

     

	 	(e)	"Cause" shall mean: 

	 	 	(i)	
    willful misconduct or gross negligence by the Executive
    in the performance of his duties under this Agreement; 

     

	 	 	(ii)	
    breach of a this Agreement by the Executive, which, if
    curable, is not substantially cured to the satisfaction of the Company
    determined by the Company in its sole discretion within ten (10) days after
    Executive's receipt of written notice from the Company of such breach;

     

	 	 	(iii)	
    failure by the Executive to perform his duties, if not
    cured to the satisfaction of the Company determined by the Company within
    ten (10) days after Executive's receipt of written notice from the Company
    of such breach, other than a failure resulting from Executive's incapacity
    due to Disability;

     

	 	 	(iv)	
    a material violation by the Executive of the Company's
    Code of Business Conduct or the Company's policies or procedures; or

     

	 	 	
    (v)
	
    conviction of the Executive of, or a plea of nolo contrendere to, a
felony, or his engagement in fraud or other willful misconduct which is
injurious to the business or reputation of the Company.

     

	 	(f)	
    "Change in Control."  A "Change in Control" shall be
    deemed to have occurred upon the occurrence of any of the following events:

     

	 	 	(i)	
    any Person (other than the
    Company, any trustee or other fiduciary holding securities under any
    employee benefit plan of the Company, or any company owned, directly or
    indirectly, by the stockholders of the Company immediately prior to the
    occurrence with respect to which the evaluation is being made in
    substantially the same proportions as their ownership of the common stock of
    the Company) acquires securities of the Company and immediately thereafter
    is the Beneficial Owner (except that a Person shall be deemed to be the
    Beneficial Owner of all shares that any such Person has the right to acquire
    pursuant to any agreement or arrangement or upon exercise of conversion
    rights, warrants or options or otherwise, without regard to the sixty
    (60)-day period referred to in Rule 13d-3 under the Exchange Act), directly
    or indirectly, of securities of the Company representing 50% or more of the
    combined voting power of the Company's then outstanding securities (except
    that an acquisition of original issue securities directly from the Company
    shall not be deemed an acquisition for purposes of this clause (i));

     

	 	 	(ii)	
    during any period of two consecutive years, individuals
    who at the beginning of such period constitute the Board, and any new
    director (other than a director designated by a person who has entered into
    an agreement with the Company to effect a transaction described in clause (i), (iii), or (iv) of this
paragraph) whose election by the Board or nomination for election by the
Company's stockholders was approved by a vote of at least two thirds of the
directors then still in office who either were directors at the beginning of
the two-year period or whose election or nomination for election was previously
so approved but excluding for this purpose any such new director whose initial
assumption of office occurs as a result of either an actual or threatened
election contest (as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) or other actual or threatened solicitation
of proxies or consents by or on behalf of an individual, corporation, partnership,
group, associate or other entity or Person other than the Board, cease for any
reason to constitute at least a majority of the Board; 

     

	 	 	(iii)	
    the consummation of a merger or
    consolidation of the Company with any other entity, other than (i) a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of the
surviving or resulting entity) more than 50% of the combined voting power of
the surviving or resulting entity outstanding immediately after such merger or
consolidation or (ii) a merger or
consolidation in which no premium is intended to be paid to any shareholder
participating in the merger or consolidation;

     

	 	 	(iv)	
    the stockholders of the Company
    approve a plan or agreement for the sale or disposition of all or
    substantially all of the consolidated assets of the Company (other than such
    a sale or disposition immediately after which such assets will be owned
    directly or indirectly by the stockholders of the Company, in substantially
    the same proportions as their ownership of the common stock of the Company
    immediately prior to such sale or disposition) in which case the Board shall
    determine the effective date of the Change in Control resulting therefrom; or

     

	 	 	
    (v)
	
    any other event occurs which the Board determines, in its
    discretion, would materially alter the structure of the Company or its
    ownership.

     

	 	(g)	 	"Commencement Date" shall mean July 25, 2005. 

	 	(h)	 	"Date of Termination" shall mean: 

	 	 	(i)	
    if the Executive's employment is terminated by the
    Company, the date the Company informs the Executive that his employment is
    so terminated;

     

	 	 	(ii)	
    if the Executive voluntarily resigns his employment, the
    date the Company receives notice from the Executive that Executive is
    terminating his employment;

     

	 	 	(iii)	if the Executive's employment is terminated by
    reason of death, the date of death; or 

	 	 	(iv)	
    if the Executive's employment is terminated for any
    reason (voluntarily or involuntarily) after a Change in Control other than
    for Cause, the applicable of the date the Company informs the Executive he
    is terminated or the date the Executive provides notice to the Company of
    his termination.

     

	 	(i)	
    "Disability" shall mean the Executive's inability, due to
    physical or mental incapacity, to substantially perform his duties and
    responsibilities for a period of ninety (90) days during any twelve-month
    period as determined by the Company.  The Executive agrees to submit to
    any examination that is necessary for a determination of Disability and
    agrees to provide any information necessary for a determination of
    Disability, including any information that is protected by the Health
    Insurance Portability and Accountability Act.

     

	 	(j)	
    "Good Reason" shall mean the occurrence of any of the
    following during the Term without the Executive's consent: 

     

	 	 	(i)	
    a material diminution in the Executive's title and duties
    as normally-associated with the position of CFO of the Company (as defined
    in the first sentence of Section 3 below) without regard to the additional
    duties and positions to which he may be assigned from time to time with
    respect to affiliates or subsidiaries as described in the second sentence of
    Section 3 below;

     

	 	 	(ii)	a reduction in the Executive's Base Salary;
     

	 	 	(iii)	
    a change in reporting structure so that the Executive 
    reports to someone other than the President of the Company; or

     

	 	 	(iv)	
    the relocation of the Executive's principal place of
    employment to a location more than fifty (50) miles from his principal place
    of employment with the Company on the Commencement Date.

     

	 	
    Anything herein to the contrary
notwithstanding, the Executive shall not be entitled to resign for Good Reason
unless the Executive gives the Company written notice of the event constituting
"Good Reason" within 60 days of the occurrence of such event and the Company
fails to cure such event within 30 days after receipt of such notice.

     

	 	(k)	
    "Initial Term" shall mean the period beginning on the
    Commencement Date and ending at the close of business on the day before the
    second anniversary of the Commencement Date.

     

	 	(l)	
    "Person" shall have the meaning ascribed to such term in
    Section 3(a)(9) of the Securities Exchange Act of 1934 and used in Sections
    13(d) and 14(d) thereof, and shall include a "group" as defined in Section
    13(d) thereof.  

     

	 	(m)	"Term" shall have the meaning
    ascribed to such term in Section 2 below. 

	2.	Term of
    Employment.The term of the Executive's employment
hereunder shall begin on the Commencement Date and end at the close of business
on the day before the second anniversary of the Commencement Date (the "Initial
Term"); provided, however, that the Initial Term shall thereafter be
automatically extended for additional one-year periods (the Initial Term and
any one-year extension of employment hereunder shall each be referred to
as the "Term") unless either the Company or the Executive gives the other
written notice at least thirty (30) days prior to the then-scheduled expiration
of the Term that such Party is electing not to so extend the Term.
Notwithstanding the foregoing, the Term shall end on the date on which the
Executive's employment is terminated by either Party in accordance with the
provisions herein.  The period from the Commencement Date through the Date of
Termination shall be the "Employment Period."

     

	3.	

Position; Duties and Responsibilities.

     

During the Term, the Executive shall be
employed as the Chief Financial Officer ("CFO") of the Company and shall
perform other duties and responsibilities as reasonably determined by the
President of the Company consistent with the duties and responsibilities
normally associated with such position in the Company.  In addition, Executive
from time to time may be assigned duties and hold positions or offices with
subsidiaries or affiliates of the Company as the President of the Company
and/or the Board may determine in their sole discretion.  The Executive, in
carrying out his duties under this Agreement, shall report to the President of
the Company.  The Executive shall devote all of his business time, energy and
best efforts to the business and affairs of the Company. Anything herein to the
contrary notwithstanding, nothing shall preclude the Executive from (i) subject
to the reasonable approval of the Board, serving on the boards of directors of
trade associations and/or charitable organizations, (ii) engaging in charitable
activities and community affairs and (iii) managing his personal investments
and affairs, provided that the activities described in the preceding clauses
(i) through (iii) do not interfere with the proper performance of his duties
and responsibilities for the Company or violate any term of this Agreement,
including but not limited to, Section 10.

     

    
	4.	

Base Salary.

     

During the Term, the Executive shall be paid
an annualized Base Salary of $240,000 payable in accordance with the regular
payroll practices of the Company. During the Term, the Base Salary may be
increased, but not decreased, from time to time by the Board or its
Compensation Committee. The Executive shall not be entitled to any compensation
for service as a member of the Board or for service as an officer or member of
any board of directors of any Affiliate.

     

    
	5.	

Bonus.

     

Beginning in calendar year 2005, the "Cash Bonus" for
Executive shall be determined under the annual incentive plan or program of the
Company ("Annual Incentive Plan") and subject to the goals, terms and
conditions of such plan or program as determined by the Board or Compensation
Committee of the Board (the "Compensation Committee") in its sole discretion on
a calendar year basis during the Term. During the Initial Term, Executive will
be eligible to receive up to 100% of his Base Salary amount as a Cash Bonus.
The Cash Bonus will be payable when bonuses are paid under Company policies and
procedures or as determined by the Board or Compensation Committee. 

     

	6.	

Stock Options and Other Equity Compensation.

     

During the Term, Executive shall receive under
the terms of the Annual Incentive Plan for each calendar year an award of stock
options or other equity-based compensation in an amount equal to 50% of his
Base Salary (the "Guaranteed Equity-Based Award").  If Executive meets the
goals, terms and conditions to receive a Cash Bonus, he shall receive an
additional award of stock options or other equity-based awards for such
calendar year under the Plan in an amount equal to 50% of the Cash Bonus (the
"Incentive Equity-Based Award").  For calendar year 2005, Executive will
receive (a) a pro rata portion of the Guaranteed Equity-Based Award based on
the number of days from the Commencement Date through December 31, 2005,
divided by 365, and (b) a pro rata portion of any Incentive Equity-Based Award,
with such proration determined by the Compensation Committee in its sole
discretion.

     

As an inducement to join the Company, as soon
as administratively possible after the Commencement Date, the Company shall
grant Executive a "Restricted Stock Grant" for 90,000 shares of Company common
stock as restricted stock, which shall vest as to 33.3% of such shares one year
from date of grant and an additional 33.3% of such shares two years from date
of grant, and Executive shall be 100% vested in such shares three years from
the date of grant. 

     

All awards under Sections 5 and 6 shall be
subject to the terms of the Company's 2004 Stock Option Plan, or any successor
thereto (the "Plan") and the award agreements granting such awards as
determined by the Compensation Committee in its sole discretion.

     

    
	7.	

Employee Benefit
Programs.

     

During the Term, the Executive shall be
entitled to participate in all employee savings and welfare benefit plans and
other employee programs made available to the Company's senior-level
executives, as such plans or programs may be amended and as may be in effect
from time to time, including, without limitation, savings and other retirement
plans or programs, medical, dental, hospitalization, short-term and long-term
disability and life insurance plans, accidental death and dismemberment
protection, travel accident insurance, and any deferred compensation plans or
programs, provided that Executive's eligibility and participation shall be
subject to and governed by the terms and conditions of the applicable plan or
program.  Notwithstanding the foregoing, nothing contained herein shall require
the Company to establish any particular employee benefit plan or program.

     

    
	8.	
    Reimbursement of Business and Other Expenses; Perquisites; Vacation. 

	 	(a)	
    During the Term, the Executive is authorized to incur
    reasonable and necessary business expenses in carrying out his duties and
    responsibilities under this Agreement and the Company shall promptly
    reimburse him for such expenses incurred in connection with carrying out the
    business of the Company, subject to documentation in accordance with the
    Company's policy.

     

	 	(b)	The Executive shall be entitled to
    four (4) weeks paid vacation per year. 

	9.	Benefits
    Upon Termination of Employment. 

	 	(a)	

Termination Without Cause by the Company or Resignation for Good Reason prior to
a Change in Control.

     

In the event the
Executive's employment is terminated without Cause by the Company (other than
upon death or Disability) or the Executive resigns for Good Reason prior to a
Change in Control, the Executive shall be entitled to the following:

     

	 	 	(i)	Base Salary earned and payable through the Date
    of Termination; 

	 	 	(ii)	
    any unpaid Cash Bonus earned and accrued with respect to
    any year preceding the Date of Termination and payable when bonuses for such
    year are paid to other Company executives subject to the terms or
    requirements of such bonus as may be established by the Board or
    Compensation Committee; 

     

	 	 	(iii)	
    an amount equal to two times the Executive's annual Base
    Salary as in effect on the Date of Termination to be paid in a lump sum as
    soon as administratively feasible after the Date of Termination but in no
    event later than two and one-half months after the Date of Termination;

     

	 	 	(iv)	
    outstanding stock option, equity and performance awards
    shall be vested and exercised in accordance with the applicable plan and
    award agreements;

     

	 	 	(v)	
    continued participation for twelve (12) months by the
    Executive and his eligible dependents in the Company's group medical and
    dental benefits plan in which he and his eligible dependents were
    participating immediately prior to the Date of Termination, subject to the
    terms and conditions of the plans as such plans are amended from time to
    time.  The Executive shall be required to continue to pay the
    employee-paid portion of such coverage during the period of coverage. 
    Upon the earlier of twelve (12) months coverage or the date
the Executive becomes eligible for medical coverage under a subsequent
employer's plan, this coverage under the Company's plan shall cease and the
Executive and his dependents, if applicable, may elect group continuation
coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA");

     

	 	 	(vi)	any amounts earned, accrued or owing to the
    Executive but not yet paid under Section 8; and 

	 	 	(vii)	except as provided in 9(h) below, any payment
    and benefit in accordance with the applicable plans and programs of the
    Company. 

	 	(b)	

Termination upon Death. 

     

In the event the Executive's employment is terminated upon
death, the Executive (or his estate or legal representative, as the case may
be) shall be entitled to:

     

	 	 	(i)	Base Salary through the Date of Termination; 

	 	 	(ii)	
    any unpaid Cash Bonus earned and accrued with respect to
    any year preceding the Date of Termination and payable when bonuses for such
    year are paid to other Company executives subject to the terms and
    requirements of such bonus as may be established by the Board or
    Compensation Committee;

     

	 	 	(iii)	outstanding stock options, equity and
    performance awards shall be vested and exercised in accordance with the
    applicable plan and award agreements; 

	 	 	(iv)	any amounts earned, accrued or owing to the
    Executive but not yet paid under Section 8 above; and 

	 	 	(v)	any other payment and benefit in accordance
    with applicable plans or programs of the Company. 

	 	(c)	Termination
    Upon Disability. 
    In the event Executive is terminated on account of Disability,
the Executive (or his estate or legal representative) shall be entitled to:

     

	 	 	(i)	
    an amount equal to the Base Salary and the Cash Bonus
    amount that would have been payable through the earlier of the end of the Term or one year
from the Date of Termination reduced by any of disability insurance payments
payable to Executive from any policy, plan or program sponsored by the Company
or its Affiliates to be paid in a lump sum as soon as administratively feasible
after the Date of Termination but in no event later than two and one-half
months after the Date of Termination;

     

	 	 	(ii)	
    any unpaid Cash Bonus earned and accrued with respect to
    any year preceding the Date of Termination and payable when bonuses for such
    year are paid to other Company executives subject to the terms and
    requirements of such bonus as may be established by the Board or
    Compensation Committee;

     

	 	 	(iii)	
    outstanding stock options, equity and performance awards
    shall be vested and exercised in accordance with the applicable plan and
    award agreements; 

     

	 	 	(iv)	any amounts earned, accrued or owing to the
    Executive but not yet paid under Section 8 above; and 

	 	 	(v)	
    except as provided in 9(h) below, any other payment and
    benefit in accordance with applicable plans or programs of the Company.

     

	 	(d)	

Termination by the Company for Cause or a Voluntary Resignation by the
Executive. 

     

In the event the Company terminates the Executive's employment
for Cause or the Executive voluntarily resigns, the Executive shall be entitled
to:

     

	 	 	(i)	Base Salary through the Date of Termination; 

	 	 	(ii)	
    outstanding stock options, equity and performance awards
    shall be vested and exercised in accordance with the applicable plan and
    award agreements; 

     

	 	 	(iii)	any amounts earned, accrued or owing to the
    Executive but not yet paid under Section 8 above; and 

	 	 	(iv)	any other payment and benefit in accordance
    with the applicable plans or programs of the Company. 

	 	(e)	

Termination as a Result of an Election by Company Not to Extend the Term.
    

     

In the event the Company elects
not to extend the Term pursuant to Section 2 hereof, and the Executive
continues to be employed with the Company to the end of the Term, at the end of
the Term the Executive shall be entitled to:

     

    
	 	 	(i)	Base Salary through the Date of Termination; 

	 	 	(ii)	
    any unpaid Cash Bonus earned and accrued with respect to
    any year preceding the Date of Termination and payable when bonuses for such
    year are paid to other Company executives subject to the terms and
    requirements of such bonus as may be established by the Board or
    Compensation Committee;

     

	 	 	(iii)	
    outstanding stock options, equity and performance awards
    shall be vested and exercisable in accordance with the applicable plan and
    award agreement; 

     

	 	 	(iv)	
    continued participation for twelve (12) months by the
    Executive and his eligible dependents in the Company's medical plan in which
    he and his eligible dependents were participating immediately prior to the
    Date of Termination, pursuant to the plan's terms as may be amended from
    time to time.  Executive shall be responsible for the payment of the
    employee-paid portion of any premiums for such coverage.  Upon the earlier of the end of the
twelve-month period or the date upon which the Executive is eligible for other
medical coverage with subsequent employer, this coverage shall cease and
Executive or his dependents may elect COBRA continuation coverage in accordance
with COBRA;

     

	 	 	(v)	any amounts earned, accrued or owing to the
    Executive but not yet paid under Section 8 above; 

	 	 	(vi)	
    except as provided in 9(h) below, any payment and benefit
    in accordance with the applicable plans or programs of the Company; and

     

	 	 	(vii)	
    a severance payment equal to one times the Executive's
    annual Base Salary, as in effect on the Date of Termination, to be paid in a
    lump sum as soon as administratively feasible after the Date of Termination
    but in no event later than two and one-half months after the Date of
    Termination.

     

	 	(f)	
    Termination After a Change in
    Control.  In the event Executive's employment  is terminated,
    without Cause, voluntarily or involuntarily after a Change in Control, the
    Executive shall be entitled to do the following:

     

	 	 	(i)	Base Salary earned and payable through the Date
    of Termination; 

	 	 	(ii)	
    any unpaid Cash Bonus earned and accrued with respect to
    any year preceding the Date of Termination and payable when bonuses for such
    year are paid to other Company executives subject to the terms and
    requirements of such bonus as may be established by the Board or
    Compensation Committee; 

     

	 	 	(iii)	
    an amount equal to two times the Base Salary, as in
    effect on the Date of Termination, to be paid in a lump sum as soon as
    administratively feasible after Executive's Date of Termination but in no
    event later than two and one-half months after the Date of Termination;

     

	 	 	(iv)	
    outstanding stock options, equity and performance awards
    shall be vested and exercised in accordance with the terms of the applicable
    plan and award agreements;

     

	 	 	(v)	
    continued participation for twelve (12) months by the
    Executive and his eligible dependents in the Company's group medical and
    dental plan in which he and his eligible dependents were participating
    immediately prior to the Date of Termination, subject to the terms and
    conditions of the plans as such plans are amended from time to time. 
    The Executive shall be required to continue to pay the employee-paid portion
    of such coverage.  Upon the earlier of the
expiration of twelve (12) months or the date the Executive becomes eligible for
medical benefits with a subsequent employer, this coverage shall cease, and the
Executive and his dependents, if applicable, may elect group continuation
coverage under COBRA;

     

	 	 	(vi)	any amounts earned, accrued or owing to the
    Executive but not yet paid under Section 8; and 

	 	 	(vii)	
    Except as provided in 9(h) below, any payment and benefit
    in accordance with the applicable plans and programs of the Company.

     

	 	(g)	
    If any amount is payable to Executive under any one
    subsection of Section 9(a) though (f), no amounts shall be payable under any
    other subsection of this Section 9; for example, if any amount is payable to
    Executive under Section 9(f), no amounts shall be payable pursuant to
    Sections 9(a) - (e).

     

	 	(h)	

Exclusivity of Benefits; Release of Claims. 

     

Any payments provided pursuant to Section 9(a), (c), (e)
or (f) shall be in lieu of any salary continuation arrangements or any
other severance-type payments under any other severance program of the Company
or its Affiliates.  In order to be
entitled to the payments, rights and other entitlements in Section 9(a),
(c), (e) OR (f), the Executive shall be
required to execute and deliver a general release of claims against the Company
and its Affiliates and their officers, directors and employees and their
successors and assigns including, but not limited to, any claims under the Age
Discrimination Act, in the form and subject to such terms as provided to him by
the Company and Executive must execute the release and not revoke such general
release within the applicable time periods therein.

     

	 	(i)	

No Mitigation. 
    

     

Executive shall not be required to mitigate the amount of any
payment provided for under this Agreement by seeking other employment and there
shall be no offset against amounts due to him on account of any remuneration or
benefits provided by any subsequent employment he may obtain, except as
expressly provided herein with respect to eligibility for medical benefits with
a subsequent employer.

     

	 	(j)	

Resignation. 

     

Notwithstanding any other provision of this Agreement, upon
the termination of the Executive's employment for any reason, unless otherwise
requested by the Board, he shall immediately resign from the Board, from all
boards of directors of any Affiliate of the Company of which he may be a
member, and as a trustee of, or fiduciary to, any employee benefit plans of the
Company or any Affiliate. The Executive hereby agrees to execute any and all
documentation of such resignations upon request by the Company, but he shall be
treated for all purposes as having so resigned upon termination of his
employment, regardless of when or whether he executes any such documentation.

     

	 	(k)	

Limitation on Amounts
Payable.

     

If all or any portion of the amount of any payment or
continuation of benefits made on account of this Agreement or otherwise would
not be deductible for federal income tax purposes by the Company or its federal
income tax affiliates (or other person who made or is required to make such
payment under this Agreement) by reason of the application of Section 280G of
the Internal Revenue Code of 1986, as amended (the "Code") and the regulations
thereunder, the aggregate amount of such payment shall be reduced until (i) no portion of the total amount of all payments and continuation of benefits under
this Agreement is not deductible by a Company or its tax affiliates (or other
person who made or is required to make such payment) by reason of the
application of that section or (ii) the aggregate amount of such payment and
continuation of benefits is reduced to zero as determined by the Company's
independent tax counsel.

     

	10.	
    Confidentiality, Assignment of Rights, Non-Competition and Non-Solicitation. 

	 	(a)	Confidentiality 

	 	 	(i)	
    Concurrent herewith and during the Employment Period, the
    Executive will create, receive and/or have access to trade secrets or
    proprietary or confidential information of the Company and its Affiliates
    consisting of written, oral, and visual material including, but not limited
    to, client lists, corporation and personal business contacts and
    relationships, corporation and personal business opportunities, memoranda,
    computer disks or files, rolodex cards or other lists of names, addresses or
    telephone numbers, financial information, projects, prospects, potential
    projects and prospects (including ideas and concepts for potential
    prospects) projects and prospects in development, business strategies,
    contracts, releases, and other documents, materials or writings that belong
    to the Company or its Affiliates including those which are prepared or
    created by Executive or come into the possession of Executive by any means
    or manner and which relate directly or indirectly to one or more of the
    parties which compromise Company or its Affiliates or any of them (all of
    the above collectively referred to herein as the "Confidential Information"
    or "Trade Secrets").

     

	 	 	(ii)	
    The Confidential Information is, and at all times shall
    be and remain, private and confidential and the sole and exclusive property
    of, and owned and controlled by, the Company regardless whether said
    Confidential Information is in tangible or intangible form.

     

	 	 	(iii)	
    Except to the extent required in connection with the
    performance of his duties for the conduction of the business of the Company,
    Executive shall not make copies of any Confidential Information, nor shall
    Executive remove any such Confidential Information from Company's office
    location without the prior express written consent of Company.  Any and
    all Confidential Information and any and all other property of Company that
    is in the possession or control of Executive shall be returned to Company
    forthwith upon the termination of Executive's employment by Company.

     

	 	 	(iv)	
    Executive shall not, directly or indirectly, verbally or
    otherwise, either during the Employment Period or after the Employment
    Period, provide any person, firm or entity with any of the Confidential
    Information or cause, or permit, the same to be published, disseminated or
    disclosed (herein collectively "Disclosure") to any person, firm or entity
    whatsoever including, but not limited to, Company's business associates or
    competitors (herein collectively "Third Parties") and shall take any and all
    action possible to present such Disclosure to any Third Parties except for
    the sole purpose to conduct the Company's business.

     

	 	 	(v)	
    Except as authorized by the foregoing for the conduction
    of the Company's business, Executive is aware that any Disclosure of
    Confidential Information by Executive to Third Parties will be, and is, a
    breach of Executive's employment, a breach of trust and confidence, a breach
    of fiduciary duty, invasion of privacy, a misappropriation of Company's
    trade secrets and/or exclusive property rights, and may constitute fraud and
    deceit.

     

	 	 	(vi)	
    Except as authorized by the foregoing for the conduction
    of the Company's business, Executive is aware that Disclosure of any of the
    Confidential Information to Third Parties could cause Company to suffer
    major adverse economic consequences due to the fact that such disclosure
    could result in (a) the diversion of Company's business opportunities, and
    (b) the dilution or diminution in value of Company's business opportunities
    and (c) other adverse consequences in addition to those set forth above.

     

	 	 	(vii)	
    In the event that Executive is compelled by subpoena or
    other similar compulsory means to testify or provide evidence in a manner
    that constitutes engaging in a prohibited Disclosure of Confidential
    Information, it shall be presumed that no violation of this Agreement has
    occurred with respect to that compulsory prohibited Disclosure if,
    immediately upon first learning that such prohibited Disclosure may be
    compelled, Executive notifies Company of all facts relative thereto and
    makes every effort to assert Company's trade secret privilege and all other
    privileges and rights of Company to keep the Confidential Information,
    including the prohibited Disclosure, secret and confidential.  However,
    under no circumstances shall Executive volunteer to engage in any such
    prohibited communication or Disclosure.

     

	 	 	(viii)	
    The Executive hereby sells, assigns and transfers to the
    Company all of his right, title and interest in and to all inventions,
    discoveries, improvements and copyrightable subject matter (the "rights")
    which during the course of his employment are made or conceived by him,
    alone or with others, and which are within or arise out of any general field
    of the Company's business or arise out of any work he performs, or
    information he receives regarding the business of the Company, while
    employed by the Company. The Executive shall fully disclose to the Company
    as promptly as available all information known or possessed by him
    concerning the rights referred to in the preceding sentence, and upon
    request by the Company and without any further remuneration in any form to
    him by the Company, but at the expense of the Company, execute all
    applications for patents and for copyright registration, assignments thereof
    and other instruments and do all things which the Company may deem necessary
    to vest and maintain in it the entire right, title and interest in and to
    all such rights.

     

	 	(b)	Non-Competition. 

	 	 	(i)	
    Executive agrees in consideration of (x) Executive's
    employment as the CFO pursuant to this Agreement of the Company and the Executive's receipt
of, access to and exposure to Confidential Information or Trade Secrets
herewith and (y) during the Employment Period Executive's receipt of, access to
and exposure to Confidential Information or Trade Secrets and the Company's
provision of specialized training to Executive that during the Employment
Period and for a period of one year following Executive's Date of Termination
with Company for any reason, Executive shall not (1) compete or engage in any
business, directly or indirectly, with Company or its Affiliates in the seismic
or similar business of the Company or of its Affiliates in any geographical
area where the Company or its Affiliates have or solicited any business or at
any time during the two (2) years had any business preceding Date of Termination
(the "Area of No-Compete") as an individual, owner, investor, partner,
shareholder, director, officer, principal, agent, employee, trustee,
consultant, or in any relationship or capacity, (2) without limiting the
foregoing, solicit or negotiate, or manage, supervise or direct others in the
solicitation or negotiation of, any contract or agreement that constitutes or
would constitute engaging in competition with the seismic business in the
portions of  the Area of No-Compete, or (3) solicit, take away, attempt to
solicit or take away, or do any act the foreseeable consequences of which would
lead to the solicitation or taking away of any marketing prospects, projects or
customers of Company's business in the Area of No-Compete.

     

	 	 	(ii)	
    For a period of one year following the Executive's Date
    of Termination with Company for any reason, Executive shall not, directly or
    indirectly, solicit for employment, employ or be in business in any form
    with, directly or indirectly, in the seismic or business of the Company, any
    employee (i)
employed by Company or Affiliates or who was so employed within the two-year
period immediately prior to such termination, or (ii) knowingly solicit or
encourage any employee to leave the employ of the Company or its Affiliates.

     

	 	 	(iii)	
    The Executive agrees that for a period of one year
    following Date of Termination he will not solicit or encourage any customer
    of the Company or any of its Affiliates to reduce or cease its business with
    the Company or any such Affiliate or otherwise knowingly interfere with the
    relationship of the Company or any Affiliate with its customers.

     

	 	(c)	Additional Covenants and
    Acknowledgments. 

	 	 	(i)	
    Executive hereby specifically acknowledges and agrees
    that the temporal, geographical and other restrictions contained in this
    Section 10 are reasonable and necessary to protect the Company's legitimate
    business interests, including but not limited to, the business, goodwill,
    Confidential Information or Trade Secrets and prospects of Company.

     

	 	 	(ii)	
    Executive specifically agrees that the actual or
    threatened breach by Executive of the provisions in Section 10 of this
    Agreement will cause irreparable harm to Company causing damages and
    injuries that are not measurable or susceptible to calculation.  In the
    event of any breach or threatened breach of this Section 10 by the
    Executive, the Company shall be entitled to extraordinary or emergency
    relief, including, but not limited to, obtaining an ex parte restraining order, preliminary injunction and
permanent injunction and to recover the Company's attorney's fees, costs and
expenses related to Executive's breach or threatened breach.  Nothing contained
in this Agreement shall be construed as prohibiting the Company from pursuing
any other remedies available to it for breach or threatened breach by
Executive, including, without limitation, the recovery of money damages. 
    

     

	 	 	(iii)	
    Executive further agrees that in the event either the
    length of time, geographical or any other restrictions, or portion thereof,
    set forth in this Section 10 is overly restrictive and unenforceable in any
    court proceeding, the court may reduce or modify such restrictions, but only
    to the extent necessary, to those which it deems reasonable and enforceable
    under the circumstances and the parties agree that the restrictions of this
    Section 10 will be enforced as reduced or modified.

     

	 	 	(iv)	
    Executive further agrees that, in the event any provision
    of this Section 10 is held to be invalid, overbroad, void, or against public
    policy, the remaining provisions of this Section 10 and all other provisions
    of this Agreement shall not be affected thereby, and that the provision held
    invalid shall be reformed to the minimum extent necessary to validate such
    provision, consistent with the purpose and intent of this Agreement.

     

	 	 	(v)	
    If the Company believes that Executive has violated any
    of the provisions of this Section 10, all benefits and payments payable
    under this Agreement shall cease and the non-competition period shall be
    suspended and will not run in favor of the Executive from the time of the
    commencement of such breach until the time when the Executive cures the
    breach to the Company's satisfaction.  If the Executive does not cure
    the violation to the satisfaction of the Company, no further benefits or
    payments will be made and all rights of Executive to such payments lapse and
    become void and the Company may pursue any other remedies provided herein.

     

	 	(d)	

Return of Materials.

     

Promptly upon the termination of Executive's employment for
any reason and in any event within five days after request by the Company,
Executive shall return all Confidential Information and all copies thereof to
the Company, and Executive shall destroy all extracts, memoranda, notes and any
other material prepared by Executive based upon Confidential Information.

     

	11.	

Cooperation.

     

Following the Date of Termination, upon
reasonable request by the Company, the Executive shall cooperate with the
Company with respect to any litigation or other dispute relating to any matter
in which he was involved or had knowledge during his employment with the
Company. The Company shall reimburse the Executive for all reasonable and
necessary out-of-pocket costs, such as travel, hotel and meal expenses,
incurred by the Executive in providing any cooperation pursuant to this Section
11.

     

    
	12.	

Assignability; Binding Nature.

     

This Agreement shall be binding upon and inure
to the benefit of the Parties and their respective successors, heirs (in the
case of the Executive) and assigns. For purposes of this Section 12, a
successor or assign of the Company shall include any type of successor or
assign of the Company upon a Change in Control and Executive's consent to the
assignment shall not be required.  No rights or obligations, benefits or
payments of the Executive under this Agreement may be assigned or transferred
by the Executive other than his rights to compensation and benefits, which may
be transferred only by will, operation of law or in accordance with Section 19
below.

     

	13.	

Entire Agreement.

     

This Agreement contains the entire understanding
and agreement between the Parties concerning the subject matter hereof and
supersedes all prior agreements, understandings, discussions, negotiations and
undertakings, whether written or oral, between the Parties with respect
thereto. In the event of any inconsistency between any provision of this
Agreement and any other provision of any other plan, policy or program of, or
other agreement with, the Company, the provisions of this Agreement shall
control

     

	14.	

Amendment or Waiver.

     

No provision in this Agreement may be amended
unless such amendment is agreed to in writing and signed by the Executive and
an authorized officer of the Company. No waiver by either Party of any breach
by the other Party of any condition or provision contained in this Agreement to
be performed by such other Party shall be deemed a waiver of a similar or
dissimilar condition or provision at the same or any prior or subsequent time.
Any waiver must be in writing and signed by the Party against whom it is being
enforced (either the Executive or an authorized officer of the Company, as the
case may be).

     

	15.	

Severability.

     

In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, in whole or in part, the remaining provisions of this Agreement shall
be unaffected thereby and shall remain in full force and effect to the fullest
extent permitted by law.

     

	16.	

Survivorship.

     

The respective rights and obligations of the
Parties hereunder, including, without limitation, Section 9 (termination of
employment), Section 10 (confidentiality, assignment of rights,
non-competition; non-solicitation, injunctive and other relief), Section 11
(cooperation), and Section 19 (resolution of disputes), shall survive any
termination of the Executive's employment to the extent necessary to the
intended preservation of such rights and obligations.

     

	17.	

Beneficiaries/References.

     

The Executive shall be entitled, to the extent
permitted under applicable plans, agreements or law, to select and change a
beneficiary or beneficiaries to receive any benefit payable hereunder following
the Executive's death by giving the Company written notice thereof. In the
event of the Executive's death or a judicial determination of his incompetence,
reference in this Agreement to the Executive shall be deemed, where
appropriate, to refer to his beneficiary, estate or other legal representative.

     

	18.	

Governing Law.

     

This Agreement shall be governed by and
construed and interpreted in accordance with the laws of Texas without
reference to principles of conflicts of law, except as preempted by applicable
federal law.

     

	19.	Resolution of Disputes. 

	 	(a)	
    
Arbitration. All disputes and controversies of every kind and
nature between any parties hereto arising out of or in connection with this
Agreement or the transactions described herein as to the construction,
validity, interpretation or meaning, performance, non-performance, enforcement,
operation or breach, shall be submitted to arbitration pursuant to the
following procedures:

     

	 	 	(i)	
    After a dispute or controversy arises, any party may, in
    a written notice delivered to the other parties to the dispute, demand such
    arbitration. Such notice shall designate the name of the arbitrator (who
    shall be an impartial person) appointed by such party demanding arbitration,
    together with a statement of the matter in controversy.

     

	 	 	(ii)	
    Within thirty (30) days after receipt of such demand, the
    other parties shall, in a written notice delivered to the first party, name
    such parties' arbitrator (who shall be an impartial person). If such parties
    fail to name an arbitrator, then the second arbitrator shall be named by the
    American Arbitration Association (the "AAA"). The two arbitrators so
    selected shall name a third arbitrator (who shall be an impartial person)
    within thirty (30) days, or in lieu of such agreement on a third arbitrator
    by the two arbitrators so appointed, the third arbitrator shall be appointed
    by the AAA. If any arbitrator appointed hereunder shall die, resign, refuse
    or become unable to act before an arbitration decision is rendered, then the
    vacancy shall be filled by the method set forth in this Section for the
    original appointment of such arbitrator.

     

	 	 	(iii)	
    Each party shall bear its own arbitration costs and
    expenses. The arbitration hearing shall be held in Houston, Texas at a
    location designated by a majority of the arbitrators. The Commercial
    Arbitration Rules of the American Arbitration Association shall be
    incorporated by reference at such hearing and the substantive laws of the
    State of Texas (excluding conflict of laws provisions) shall apply.

     

	 	 	(iv)	
    The arbitration hearing shall be concluded within ten
    (10) days unless otherwise ordered by the arbitrators and the written award
    thereon shall be made within fifteen (15) days after the close of submission
    of evidence. An award rendered by a majority of the arbitrators appointed
    pursuant to this Agreement shall be final and binding on all parties to the
    proceeding, shall resolve the question of costs of the arbitrators and all
    related matters, and judgment on such award may be entered and enforced by
    either party in any court of competent jurisdiction.

     

	 	 	(v)	
    Except as set forth in Section 19(b) and (c), the parties
    stipulate that the provisions of this Section shall be a complete defense to
    any suit, action or proceeding instituted in any federal, state or local
    court or before any administrative tribunal with respect to any controversy
    or dispute arising out of this Agreement or the transactions described
    herein. The arbitration provisions hereof shall, with respect to such
    controversy or dispute, survive the termination or expiration of this
    Agreement.

     

	 	 	
    No party to an
arbitration may disclose the existence or results of any arbitration hereunder
without the prior written consent of the other parties; nor will any party to
an arbitration disclose to any third party any confidential information disclosed
by any other party to an arbitration in the course of an arbitration hereunder
without the prior written consent of such other party.

     

	 	(b)	
    
Emergency Relief. Notwithstanding anything in this Section 19(a)
to the contrary, any party may seek from a court any provisional remedy that
may be necessary to protect any rights or property of such party pending the
establishment of the arbitral tribunal or its determination of the merits of
the controversy or to enforce a party's rights under this Section 19.

     

	 	(c)	
    
Emergency or Extraordinary Relief Related to Section 10. 
Notwithstanding the foregoing, the Company shall have right to seek emergency
or extraordinary relief, including but not limited to, a temporary restraining
order, injunctive relief or any relief described in Section 10, for Executive's
breach or threatened breach of any provision in Section 10 of this Agreement.

     

	20.	

Notices.

     

Any notice given to a Party shall be in
writing and shall be deemed to have been given (i) when delivered personally,
(ii) three days after being sent by certified or registered mail, postage
prepaid, return receipt requested or (iii) two days after being sent by
overnight courier (provided that a written acknowledgement of receipt is
obtained by the overnight courier), with any such notice duly addressed to the
Party concerned at the address indicated below or to such other address as such
Party may subsequently give such notice of in accordance with this Section 20:

     

	
     
	
     
	

If to the Company:                                           
Seitel Inc.

                                                                       
10811 S. Westview Circle

                                                                        
Houston, Texas 77043

                                                                        
Attention: General Counsel

     

If to the Executive:                                            
William Restrepo

                                                                        
3219 Oakmont Drive

                                                                        
Sugar Land, TX  77479

     

	21.	

Withholding.

     

The Company may withhold or deduct from any
and all amounts payable under this Agreement (a) such federal, state, local and
other taxes or deductions as may be required to be withheld pursuant to
applicable law or regulation, (b) all other normal employee deductions made
with respect to the employee plans and programs in which Executive
participates.

     

	22.	

General Assets.

     

All payments to Executive provided for under
this Agreement shall be paid in cash from the Company and no special or
separate funds shall be established and no segregation of assets shall be made
to assure payment.  To the extent that any person acquires a right to receive
payments from the Company hereunder, such right shall be no greater than the
right of an unsecured creditor of the Company.

     

	23.	

Executive
Acknowledgment.

     

Executive acknowledges that (a) he is knowledgeable and sophisticated as to business matters, including the subject matters of this
Agreement, (b) he has read this Agreement, (c) he has been advised by the Company to consult an independent attorney and he has consulted with and been
advised by his independent attorney, and (d) he understands the terms and conditions of this Agreement.  Executive represents that he is free to enter
into this Agreement and that he is not subject to another employment agreement
with the Company or covenant not to compete with the Company that would
conflict with this Agreement.

     

	24.	

Headings.

     

The headings of the sections contained in this
Agreement are for convenience only and shall not be deemed to control or affect
the meaning or construction of any provision of this Agreement.

     

	25.	

Certain Interpretive
Matters.

     

The definitions contained in this Agreement are applicable
to the singular as well as plural form of such terms and to the masculine as
well as to the feminine and neuter genders of such term.

     

	26.	

Code Section 409A.

     

The parties agree that this Agreement shall be operated
and amended at the Company's discretion to the extent necessary to comply with
or to be exempt from Section 409A of the Internal Revenue Code of 1986, as
amended (the "Code"), and Executive hereby consents to any such amendment.

     

	27.	

Counterparts.

     

This Agreement
may be executed in two or more counterparts.

                 

           

IN WITNESS
WHEREOF, the undersigned have executed this Agreement as of October 19, 2005.

 

 

  	
      SEITEL INC.     
      
	
      THE EXECUTIVE

       

	
      By:
	
      /s/ Robert D. Monson               
      
	
      By:
	
      /s/ William Restrepo                 
      

	
       
	
      Mr. Robert D. Monson

      President
	
       
	
      Mr. William Restrepo_

Exhibit 10.5

SEITEL, INC.

Revised Summary of 2005 Non-Employee Director and Executive
Officer

Compensation and Incentive Arrangements

General

    The following reflects updated information for revisions made to certain
non-employee director and executive officer compensation and incentive
arrangements during 2005.

Non-Employee
Director Compensation

    For fiscal year 2005, non-employee directors of Seitel, Inc. (the
"Company") receive an annual fee of $30,000, annual restricted stock awards
valued at $20,000 (granted at the close of the first trading date of the
calendar year), $1,500 for each board meeting attended in person and $500 for
each board meeting attended by telephone conference, including committee
meetings attended.  In addition, the Chairman of the Board receives $250,000
per year on an annualized basis, which was reduced to $100,000 effective July
1, 2005, the Lead Director (which position was left vacant effective June 1,
2005) receives $1,500 per day when performing services on behalf of the Company,
and annual fees are paid to each committee chairman as follows: audit
committee, $15,000; compensation committee, $10,000; corporate governance and
nominating committee $7,500. All directors are entitled to reimbursement for
their reasonable out-of-pocket expenditures.

Executive
Officer Compensation

    The Company has the following compensatory arrangements with each of its
executive officers for fiscal year 2005:

	
   Name

   	
   Title

   	
   Base
   Salary

   	
   Restricted

   Stock Grants(1)(2)

   	
   Unrestricted

   Stock Grants(1)(2)

   	
   Discretionary
   Cash Bonuses(1)

   
	
  Robert D. Monson

  	
  President and Chief Executive
  Officer

  	
  $400,000

  	
  316,000(3)

  	
  -

  	
  -

  
	
  Kevin P. Callaghan

  	
  Executive Vice President and
  Chief Operating Officer

  	
  $330,000

  	
  440,000

  	
  -

  	

  
	
  Robert J. Simon

  	
  President -

  Seitel Data, Ltd.

  	
  $260,000

  	
  321,000

  	
  -

  	

  
	
  Garis Smith

  	
  President - Olympic Seismic,
  Ltd.

  	
  C $240,000(4)

  	
  146,000

  	
  32,000

  	
  C $101,724(4)

  
	
  William J. Restrepo

  	
  Executive Vice President, Chief
  Financial Officer

  and Secretary

  	
  $240,000(5)

  	
  210,000(6)

  	
  -

  	
  -

  
	
  Marcia
  H. Kendrick

  	
  Senior
  Vice President, Chief Accounting Officer and Treasurer

  	
  $200,000

  	
  156,000(2)

  	
  -

  	
  -

  
	

  	

  	

  	

  	

  	

  

                        

	
    (1)
	
    Each executive officer is also
    eligible, under the Incentive Plan, for a cash bonus and a further equity
    award in a dollar amount equal to the participant's target percentage
    multiplied by the participant's cash bonus amount, if any.  See
    "Incentive Plan for 2005" below.

     

	
    (2)
	
    Includes restricted stock granted
    pursuant to the Incentive Plan and other discretionary awards.  See
    "Incentive Plan for 2005" below.

     

	
    (3)
	
    Included in the 1,000,000 shares
    of restricted stock awarded to Mr. Monson on December 15, 2005.

     

	
    (4)
	
    Represents Canadian dollars.

     

	
    (5)
	
    Represents
    annualized based salary.  Mr. Restrepo joined the Company on July 25,
    2005.

     

    
	
    (6)
	
    Mr. Restrepo is entitled to a
    further equity award valued at approximately $52,600 payable in January
    2006.

Incentive Plan
for 2005

    On January 24, 2005 the Compensation Committee of the Company
established the criteria to be used in determining cash bonuses and certain
incentive equity awards (the "Incentive Plan") for fiscal year 2005.  The
Company's named executive officers and certain other executives participate in
the Incentive Plan, which is operated under the Company's 2004 Stock Option
Plan (the "Plan").  The targets and financial performance measures established
under the Incentive Plan are described below.  The Compensation
Committee reserves the right to modify the targets and financial performance
measures at any time, or to grant cash bonuses or equity awards to executive
officers even if the performance goals are not met.  The cash bonuses and
Performance Equity Awards (defined below) are subject to increase or decrease
of up to 50% in the discretion of the Compensation Committee.  In
order to receive a cash bonus and incentive equity award, if any, the
participants must be employed by the Company on the date such cash bonuses and
incentive equity awards are paid; however, Messrs. Manson, Callaghan and
Restrepo may be eligible for a cash bonus payable after termination in
accordance with the terms of each of their written employment agreements.  The
Company expects to pay 2005 cash bonuses and Performance Equity Awards, if any,
in early 2006.  The Compensation Committee reserves the right to modify the
Incentive Plan for subsequent fiscal years.

Cash Bonuses

    The Incentive Plan provides for a target cash bonus for each participant
based upon a percentage of the participant's base salary, with the opportunity
to earn anywhere from 0% to 200% of the target cash bonus.  The targets, as a
percentage of base salary, for the Company's named executive officers are as
follows:

  	

Robert D. Monson, 

  
President and Chief Executive Officer

       
	
      90%

	

Kevin P.
Callaghan, 

   Chief
Operating Officer and Executive Vice President   

       
	
      60%

	

Robert J.
Simon, 

  
President-Seitel Data, Ltd. 

       
	
      60%

	

Garis
Smith

  
President-Olympic Seismic, Ltd.    

       
	
      45%

	

William
J. Restrepo,

   Executive
Vice President, Chief Financial Officer

   and
Secretary 

       
	
      50%(1)

	

Marcia H.
Kendrick, 

   Senior
Vice President, Chief Accounting Officer,

   and
Treasurer
	
      25%

                        

 

	
    (1)
	Mr. Restrepo's cash bonus will be prorated because of his July 25, 2005 start date.

    The Compensation Committee established cash margin, net of interest
expense (80% weight) and client pre-funding percentage (20% weight) as the
financial performance measures under the Incentive Plan.  Cash margin includes
cash resales plus all other cash revenues other than from data acquisitions,
less cash selling, general and administrative expenses, and cost of goods
sold.  Cash resales result when the Company invoices customers for purchases of
licenses to data from the Company's library.  Other cash revenues are primarily
from the reproduction and delivery of seismic data.  Client prefunding
percentage is the average of all revenue pre-commitments for each new survey as
a percentage of the total cost of such survey.  Where the level achieved under
the financial performance measures falls between zero and target level or
target and maximum levels, the cash bonus is determined by interpolation.

Incentive
Equity Awards

    The Incentive Plan includes two categories of equity awards.  Robert D.
Monson, Kevin P. Callaghan, Robert J. Simon, William J. Restrepo, and Marcia H.
Kendrick are the executives currently eligible for the first category of equity
award ("Key Executive Award(s)").  With the exception of Mr. Restrepo, the 2005
Key Executive Awards have been made in shares of the Company's restricted
common stock, par value $.01 per share (the "Common Stock"), under the Plan as
follows:

	

   

   
	
   Shares

   	
   Award Date

   
	
  Robert D.
  Monson,

    President and Chief Executive Officer

  	
  316,000

  	
  December 15,
  2004

  
	
  Kevin P.
  Callaghan,

    Chief Operating Officer and Executive Vice President

  	
  160,000

  	
  March 23,
  2005

  
	
  Robert J.
  Simon,

    President-Seitel Data, Ltd.

  	
  126,000

  	
  February 15,
  2005

  
	
  Marcia H.
  Kendrick

    Senior Vice President, Chief Accounting Officer

    and Treasurer

   

  	
  36,000

  	
  July 14,
  2005

  

    Mr. Restrepo's 2005 Key Executive Award will be valued at approximately
$52,600 and payable in shares of restricted Common Stock based on the closing
price of the Common Stock on the first trading day in 2006.

    Mr. Monson's Key Executive Award of 316,000 shares of restricted Common
Stock was included in the 1,000,000 shares of restricted Common Stock awarded
to him on December 15, 2004, and is subject to increase.  He is entitled to a 2005
Key Executive Award of restricted Common Stock in an amount equal to 90% of his
base salary ($360,000) and has been deemed to have received $316,000 of this
amount with the 316,000 shares already awarded.  The closing price of the
Common Stock on the first trading day in 2006 will be divided into $44,000 to
arrive at the number of additional restricted Common Stock to be awarded to Mr.
Monson.  Unless modified by the Compensation Committee and except as noted
below, Key Executive Awards in subsequent years will be made in shares of
restricted Common Stock in dollar amounts equal to the participant's target
percentage (Mr. Monson (90%), Mr. Callaghan (60%)(1), Mr. Simon
(60%), Mr. Restrepo (50%), and Ms. Kendrick (25%)) multiplied by the
participant's base salary.  These subsequent year Key Executive Awards, will be
made based on the closing price of the Common Stock on the first trading day of
the year.

    All participants in the Incentive
Plan are eligible for the second category of equity awards ("Performance Equity
Awards"), which will be made in shares of restricted Common Stock (except as
noted below) in a dollar amount equal to the participant's target percentage
multiplied by the participant's cash bonus amount.  Performance Equity Awards
will be made only if the participant meets the performance criteria to receive
a cash bonus as described above.  The named executive officers' target
percentages for a Performance Equity Award are as follows:

  	

Robert D.
Monson, 

  
President and Chief Executive Officer   

       

      	
      90%

	

Kevin P.
Callaghan, 

   Chief
Operating Officer and Executive Vice President   

       

      	
      60%

	

Robert J. Simon, 

  
President-Seitel Data, Ltd.        

       

      	
      60%

	
      Garis
Smith,

   President-Olympic Seismic, Ltd.  

       
	
      50%(1)

	

William
J. Restrepo,

   Executive Vice President, Chief Financial Officer

   and
Secretary 

       

      	
      50%(2)

	

Marcia H.
Kendrick, 

   Senior
Vice President, Chief Accounting Officer,

   and
Treasurer     
	
       50%

                        

	
    (1)
	
    Approximately 40% of Mr. Smith's
    future Key Executive Awards and Performance Equity Awards are expected to be
    made in shares of unrestricted Common Stock.

     

	
    (2)
	
    Mr. Restrepo's Performance Equity Award will reflect proration for his July 25,
2005 start date.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00093-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00093-of-00352.parquet"}]]