MIND TECHNOLOGY, INC — Proxy Solicitation & Information Statement 2009

May 29, 2009

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by the Registrant þ Filed by a Party other than the Registrant o

Check the appropriate box:

o	Preliminary Proxy Statement
o	Confidential, for Use of the Commission Only (as permitted by Rule 14a- 6(e)(2) )
þ	Definitive Proxy Statement
o	Definitive Additional Materials
o	Soliciting Material Under Rule 14a-12

Mitcham Industries, Inc.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

þ	No fee required.
o	Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1)	Title of each class of securities to which transaction applies:
(2)	Aggregate number of securities to which transaction applies:
(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act
Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was
determined):
(4)	Proposed maximum aggregate value of transaction:
(5)	Total fee paid:

o	Fee paid previously with preliminary materials.
o	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2)
and identify the filing for which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form or Schedule and the date of its
filing.

(1)	Amount Previously Paid:
(2)	Form, Schedule or Registration Statement No.:
(3)	Filing Party:
(4)	Date Filed:

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MITCHAM INDUSTRIES, INC.

8141 SH 75 SOUTH P.O. BOX 1175 HUNTSVILLE, TEXAS 77342-1175

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JULY 23, 2009

To our Shareholders:

We will hold the Annual Meeting of Shareholders of Mitcham Industries, Inc., a Texas corporation, on Thursday, July 23, 2009, at the Houston Marriott North, 225 North Sam Houston Parkway East, Houston, Texas at 10:00 a.m., local time. At the Annual Meeting, shareholders will be asked to:

| 1. | Elect six individuals to serve on our Board of Directors until
the next annual meeting of shareholders, each until their
respective successors are duly elected and qualified; |
| --- | --- |
| 2. | Approve an amendment to the Mitcham Industries, Inc. Stock
Awards Plan to increase the shares of common stock authorized
for issuance under the plan by 350,000 shares; |
| 3. | Ratify the selection by the Audit Committee of our Board of
Directors of Hein & Associates LLP as our independent
registered public accounting firm for the fiscal year ending
January 31, 2010; and |
| 4. | Transact such other business as may properly come before the
meeting and any adjournment or postponement thereof. |

Our Board of Directors has established the close of business on May 26, 2009 as the record date for determining the shareholders entitled to notice of and to vote at the Annual Meeting of Shareholders to be held July 23, 2009, and any adjournment or postponement thereof.

A list of all shareholders will be available for inspection at our Annual Meeting, and during normal business hours, ten days prior thereto, at our offices, which are located at 8141 SH 75 South, Huntsville, Texas 77340.

Sincerely, Billy F. Mitcham, Jr. President and Chief Executive Officer

EVEN IF YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE, SIGN AND MAIL THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE IN THE ACCOMPANYING ENVELOPE OR USE THE TELEPHONE OR INTERNET VOTING.

June 1, 2009

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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SHAREHOLDER MEETING TO BE HELD ON JULY 23, 2009.

The Company’s Proxy Statement for the 2009 Annual Meeting of Shareholders and the Annual Report to Shareholders for the fiscal year ended January 31, 2009 are available at www.proxyvote.com

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TABLE OF CONTENTS

TOC

SOLICITATION OF PROXIES	1
Purpose, Place, Date and Time	1
Expenses of Solicitation	1
Shareholders Sharing the Same Last Name and
Address	1
VOTING OF SECURITIES	2
Record Date; Shareholders Entitled to Vote	2
Quorum	2
Abstentions and Broker Non-Votes	2
Vote Required	3
Revocation of Proxies	3
CORPORATE GOVERNANCE	3
Our Governance Practices	3
Our Board	4
Committees of Our Board	5
Director Nomination Process	7
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER
PARTICIPATION	7
TRANSACTIONS WITH RELATED PERSONS	8
Policies and Procedures	8
Transactions	9
STOCK OWNERSHIP MATTERS	9
Section 16(a) Beneficial Ownership Reporting
Compliance	9
Principal Holders of Securities	9
Security Ownership of Management	10
PROPOSAL 1: ELECTION OF DIRECTORS	11
General	11
Information About Director Nominees	11
INFORMATION ABOUT OUR EXECUTIVE OFFICERS	13
COMPENSATION DISCUSSION AND ANALYSIS	14
Overview of Our Executive Compensation Program	14
Objectives of Our Executive Compensation
Program	14
Implementing Our Objectives	14
Elements of Our Executive Compensation Program	16
Employment Agreements, Severance Benefits and
Change in Control Provisions	20
Other Matters	21
COMPENSATION COMMITTEE REPORT	22
EXECUTIVE COMPENSATION	23
Summary Compensation	23
Grants of Plan-Based Awards	24
Narrative Disclosure to Summary Compensation
Table and Grants of Plan-Based Awards Table	25
Outstanding Equity Awards Value at Fiscal
Year-End Table	26
Option Exercises and Stock Vested	27
Potential Payments upon Termination or Change in
Control	27

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DIRECTOR COMPENSATION	30
General	30
Retainer/Fees	30
Equity-Based Compensation	31
PROPOSAL 2: AMENDMENT TO THE MITCHAM
INDUSTRIES, INC. STOCK AWARDS PLAN	32
Introduction	32
Reason for Proposed Amendment	32
Purpose and Key Features of the Plan	32
Number of Shares Subject to the Plan	32
Administration	33
Eligibility	33
Term of Plan	33
Stock Options and SARs	33
Restricted Stock	34
Performance Awards	34
Phantom Stock Awards	34
Stock Payments	34
Other Stock-Based Awards	34
Performance-Based Compensation	34
Miscellaneous	35
Federal Income Tax Aspects of the Plan	35
Inapplicability of ERISA	36
Grants to Certain Individuals	36
Securities Authorized for Issuance under Equity
Compensation Plans	37
Recommendation of the Board	37
PROPOSAL 3: RATIFICATION OF THE SELECTION OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	38
FEES AND EXPENSES OF HEIN & ASSOCIATES
LLP	38
AUDIT COMMITTEE REPORT	39
ANNUAL REPORT	40
OTHER MATTERS	40
SHAREHOLDER PROPOSALS AND DIRECTOR
NOMINATIONS	40

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MITCHAM INDUSTRIES, INC. 8141 SH 75 South P.O. Box 1175 Huntsville, Texas 77342-1175

callerid=999 iwidth=456 length=244

PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS To be Held July 23, 2009

callerid=999 iwidth=456 length=244

SOLICITATION OF PROXIES

Purpose, Place, Date and Time

This proxy statement is furnished in connection with the solicitation by the Board of Directors (“Board”) of Mitcham Industries, Inc., a Texas corporation, of proxies from the holders of record of our common stock, par value $0.01 per share, at the close of business on May 26, 2009, for use in voting at the Annual Meeting of Shareholders (“Annual Meeting”) to be held at the Houston Marriott North, 225 North Sam Houston Parkway East, Houston, Texas at 10:00 a.m., local time, on Thursday, July 23, 2009, and any adjournment or postponement thereof.

The Notice of Annual Meeting, this proxy statement, the attached proxy card and our Annual Report for the fiscal year ended January 31, 2009 are being mailed together on or about June 1, 2009 to each of our shareholders entitled to notice of and to vote at the Annual Meeting.

Properly executed proxies will be voted as directed. If no direction is indicated therein, proxies received in response to this solicitation will be voted FOR : (1) the election of each of the six individuals nominated for election as directors; (2) the amendment to the Mitcham Industries, Inc. Stock Awards Plan to increase the shares of stock authorized for issuance under the plan by 350,000 shares; (3) the ratification of the selection of Hein & Associates LLP as our independent registered public accounting firm by our Audit Committee for the fiscal year ending January 31, 2009; and (4) as recommended by our Board with regard to any other matters that properly come before the Annual Meeting, or if no recommendation is given, at the discretion of the appointed proxies.

Expenses of Solicitation

We will bear the entire cost of soliciting proxies, including the cost of the preparation, assembly, printing and mailing of this proxy statement, the proxy card and any additional information furnished to our shareholders in connection with the Annual Meeting. In addition to this solicitation by mail, our directors, officers and other employees may solicit proxies by use of mail, telephone, facsimile, electronic means, in person or otherwise. These persons will not receive any additional compensation for assisting in the solicitation, but may be reimbursed for reasonable out-of-pocket expenses in connection with the solicitation. We have retained Broadridge Investor Communication Services to aid in the distribution of proxy materials and to provide voting and tabulation services for the Annual Meeting. For these services, we will pay Broadridge a fee of approximately $11,000 and reimburse it for certain expenses. In addition, we will reimburse brokerage firms, nominees, fiduciaries, custodians and other agents for their expenses in distributing proxy material to the beneficial owners of our common stock.

Shareholders Sharing the Same Last Name and Address

We are sending only one copy of our proxy statement and Annual Report to shareholders who share the same last name and address, unless they have notified us that they want to continue receiving multiple copies. This practice, known as “householding,” is designed to reduce duplicate mailings and save significant printing and postage costs.

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If you received a householded mailing this year and you would like to have additional copies of our proxy statement and Annual Report mailed to you or you would like to opt out of this practice for future mailings, we will promptly deliver such additional copies to you if you submit your request to our Corporate Secretary in writing at Mitcham Industries, Inc., P.O. Box 1175, Huntsville, Texas 77342-1175 or call us at 936-291-2277. You may also contact us if you received multiple copies of the annual meeting materials and would prefer to receive a single copy in the future.

VOTING OF SECURITIES

Record Date; Shareholders Entitled to Vote

Our Board has fixed the close of business on May 26, 2009 as the record date for determining the holders of shares of common stock entitled to notice of and to vote at the Annual Meeting. As of the close of business on May 26, 2009, there were 9,802,138 issued and outstanding shares of common stock, each of which is entitled to one vote on each item of business to be conducted at the Annual Meeting.

For a period of 10 days prior to the Annual Meeting, a list of the shareholders entitled to vote at the Annual Meeting will be available for inspection during normal business hours at our principal place of business, which is located at 8141 SH 75 South, Huntsville, Texas 77340.

Quorum

Our Second Amended and Restated Bylaws provide that a majority of the outstanding shares of common stock entitled to vote, represented either in person or by proxy, will constitute a quorum for the transaction of business. Consequently, holders of at least 4,901,070 shares of our common stock must be present either in person or by proxy to establish a quorum for the Annual Meeting.

Abstentions and Broker Non-Votes

Abstentions and broker non-votes are counted for purposes of determining the presence or absence of a quorum for the transaction of business. Abstentions occur when stockholders are present at the Annual Meeting but choose to withhold their vote for any of the matters upon which the stockholders are voting. “Broker non-votes” occur when other holders of record (such as banks and brokers) that hold shares on behalf of beneficial owners do not receive voting instructions from the beneficial owners before the Annual Meeting and do not have discretionary authority to vote those shares if they do not receive timely instructions from the beneficial owners. At the Annual Meeting, brokers will have discretionary authority to vote on proposal nos. 1 (election of directors) and 3 (ratification of independent registered accounting firm selection) in the absence of timely instructions from the beneficial owners. As a consequence, there will be no broker non-votes with regard to proposal nos. 1 and 3. Brokers will not have discretionary authority to vote on proposal no. 2 (amendment to the Stock Awards Plan). Accordingly, there may be broker non-votes with regard to proposal no. 2 and such broker non-votes will not be counted for purposes of determining whether a majority vote is achieved with respect to the approval of the amendment of the Stock Awards Plan.

You may vote “FOR” or “WITHHOLD AUTHORITY” for each director nominee. If you “WITHHOLD AUTHORITY,” your votes will be counted for purposes of determining the presence or absence of a quorum, but will have no legal effect on the election of directors under Texas law.

You may vote “FOR,” “AGAINST” or “ABSTAIN” on our proposal to amend the Stock Awards Plan. In the approval of the amendment to the Stock Awards Plan, abstentions will have the same effect as a vote “AGAINST” approval.

You may vote “FOR,” “AGAINST” or “ABSTAIN” on our proposal to ratify the selection of our independent registered public accounting firm. In the ratification of the appointment of our independent registered public accounting firm, abstentions will have the same effect as a vote “AGAINST” ratification.

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Vote Required

Assuming a quorum is present, the election of directors will require a plurality of the votes cast at the Annual Meeting. The proposal to amend the Stock Awards Plan and the proposal to ratify selection of the independent registered public accounting firm will each require the affirmative vote of a majority of the shares entitled to vote on, and that vote, for, against or expressly abstain, with respect to the proposal at the Annual Meeting.

All votes will be tabulated by the inspector of elections appointed for the Annual Meeting, who will separately tabulate votes for and against and abstentions.

Revocation of Proxies

If you are a registered shareholder (meaning your shares are registered directly in your name with our transfer agent) you may revoke your proxy at any time prior to the vote tabulation at the Annual Meeting by (1) sending in an executed proxy card with a later date, (2) timely submitting a proxy with new voting instructions by telephone or over the Internet, (3) sending a written notice of revocation by mail to P.O. Box 1175, Huntsville, Texas 77342-1175 marked “Proxy Information Enclosed, Attention: Corporate Secretary” or (4) by attending and voting in person by completing a ballot at the Annual Meeting. Attendance at the Annual Meeting will not, in itself, constitute revocation of a completed and delivered proxy card.

If you are a street name shareholder (meaning that your shares are held in a brokerage account by a bank, broker or other nominee) and you vote by proxy, you may change your vote by submitting new voting instructions to your bank, broker or nominee in accordance with that entity’s procedures.

CORPORATE GOVERNANCE

The following sections summarize information about our corporate governance policies, our Board and its committees and the director nomination process.

Our Governance Practices

General

We are committed to sound corporate governance principles. To evidence this commitment, our Board has adopted charters for its committees and a Code of Ethics. These documents provide the framework for our corporate governance. A complete copy of the current version of each of these documents is available on our website at http://www.mitchamindustries.com or in print, free of charge, to any shareholder who requests it by contacting us by mail at Mitcham Industries, Inc., P.O. Box 1175, Huntsville, Texas 77342-1175, Attention: Corporate Secretary, or by telephone (936) 291-2277. Our Board regularly reviews corporate governance developments and modifies our governance documents as appropriate.

Code of Ethics

Our Board has adopted a Code of Ethics that applies to all of our employees, including our Chief Executive Officer, Chief Financial Officer and our Corporate Controller, to ensure that our business is conducted in a legal and ethical manner.

All of our directors, officers and employees are required to certify their compliance with the Code of Ethics. The code requires that any exception to or waiver for an executive officer or director be made only by our Board and disclosed as required by law and the listing standards of The NASDAQ Stock Market LLC (the “NASDAQ Listing Standards”). To date, we have neither received any requests for, nor granted, waivers of the code for any of our executive officers or directors.

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Among other things, the code addresses:

•	conflicts of interest;
•	insider trading;
•	record keeping and questionable accounting or auditing matters;
•	corporate opportunities;
•	confidentiality;
•	competition and fair dealing;
•	protection and proper use of our company assets; and
•	reporting of any illegal or unethical behavior.

It is our policy that there shall be no acts of retaliation, intimidation, threat, coercion or discrimination against any individual for truthfully reporting, furnishing information or assisting or participating in any manner in an investigation, compliance review or other activity related to the administration of the code.

Our Board

Determination of Director Independence

As required under the listing standards of The NASDAQ Stock Market LLC (“NASDAQ”), a majority of the members of our Board must qualify as independent, as affirmatively determined by our Board. The Board evaluated all relevant transactions or relationships between each director, or any of his or her family members, and our company, senior management and independent registered accounting firm. Based on this evaluation, our Board has determined that Messrs. John F. Schwalbe, R. Dean Lewis, Robert J. Albers and Peter H. Blum are each an independent director, as that term is defined in the NASDAQ Listing Standards. Messrs. Schwalbe, Lewis, Albers and Blum constitute a majority of the members of our Board. Mr. Billy F. Mitcham, Jr. is not independent because he currently serves as our President and Chief Executive Officer. Mr. Robert P. Capps is not independent because he currently serves as our Executive Vice President of Finance and Chief Financial Officer.

Attendance at Board and Committee Meetings

During the fiscal year ended January 31, 2009, our Board held four meetings. Each individual serving as a director during such period attended all meetings of our Board and all meetings of the committees on which such individual served, with the exception of one member of the Audit Committee who did not attend one of the five meetings held by that committee during the year.

Attendance at Annual Meetings

Our policy is to encourage our directors to attend the annual meetings of our shareholders. All nominees who are currently serving as directors attended the annual meeting of our shareholders in July 2008.

Shareholder Communications with Our Board

Our Board welcomes communications from our shareholders. Shareholders may send communications to our Board, or any director in particular, by contacting us by mail at Mitcham Industries, Inc., P.O. Box 1175, Huntsville, Texas 77342-1175, Attention: Corporate Secretary or via e-mail through our website at http://www.mitchamindustries.com . Each communication must (1) identify the sender, (2) identify the applicable director(s) and (3) contain the information necessary to enable the director(s) to contact the sender. Our Corporate Secretary will relay this information to the applicable director(s) and request that the sender be contacted as soon as possible.

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Committees of Our Board

As of the date of this proxy statement, our Board has standing Audit, Compensation and Nominating Committees. Our Board, in its business judgment, has determined that each committee is comprised entirely of independent directors as currently required under the Securities and Exchange Commission’s rules and requirements and the NASDAQ Listing Standards. Each committee is governed by a written charter approved by the full Board.

Audit Committee

The Audit Committee has been established to assist our Board in:

| • | overseeing the quality and integrity of our financial statements
and other financial information we provide to any governmental
body or the public; |
| --- | --- |
| • | overseeing our compliance with legal and regulatory requirements; |
| • | overseeing the independent registered public accounting
firm’s qualifications, independence and performance; |
| • | overseeing our systems of internal controls regarding finance,
accounting, legal compliance and ethics that our management and
our Board have established; |
| • | facilitating an open avenue of communication among the
registered independent accountants, financial and senior
management, and our Board, with the registered independent
accountants being accountable to the Audit Committee; and |
| • | performing such other duties as directed by our Board. |

In connection with these purposes, the Audit Committee annually selects, engages and evaluates the performance and ongoing qualifications of, and determines the compensation for, our independent registered public accounting firm, reviews our annual and quarterly financial statements, and confirms the independence of our independent registered public accounting firm. The Audit Committee also meets with our management and external registered public accounting firm regarding the adequacy of our financial controls and our compliance with legal, tax and regulatory matters and significant internal policies. While the Audit Committee has the responsibilities and powers set forth in its charter, it is not the duty of the Audit Committee to plan or conduct audits, to determine that our financial statements are complete and accurate, or to determine that such statements are in accordance with accounting principles generally accepted in the United States and other applicable rules and regulations. Our management is responsible for the preparation of our financial statements in accordance with accounting principles generally accepted in the United States and our internal controls. Our independent registered public accounting firm is responsible for the audit work on our financial statements. It is also not the duty of the Audit Committee to conduct investigations or to assure compliance with laws and regulations and our policies and procedures. Our management is responsible for compliance with laws and regulations and compliance with our policies and procedures.

During the fiscal year ended January 31, 2009, the Audit Committee, which was comprised of Messrs. Schwalbe (Chairman), Lewis and Albers, held five meetings.

All members of the Audit Committee are independent as that term is defined in the NASDAQ Listing Standards and Rule 10A-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our Board has determined that each member of the Audit Committee is financially literate and that Mr. Schwalbe has the necessary accounting and financial expertise to serve as chairman. Our Board has determined that Mr. Schwalbe is an “audit committee financial expert” following a determination that Mr. Schwalbe met the criteria for such designation under the Securities and Exchange Commission’s rules and regulations. For information regarding Mr. Schwalbe’s business experience, see “Proposal 1 — Election of Directors — Information About Director Nominees.”

The report of the Audit Committee appears under the heading “Audit Committee Report” below.

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Compensation Committee

Pursuant to its charter, the purposes of our Compensation Committee are to:

| • | review, evaluate and approve the agreements, plans, policies and
programs to compensate our officers and directors; |
| --- | --- |
| • | review and discuss with our management the Compensation
Discussion and Analysis to be included in the proxy statement
for our annual meeting of shareholders and to determine whether
to recommend to our Board that the Compensation Discussion and
Analysis be included in the proxy statement, in accordance with
applicable rules and regulations; |
| • | produce the Compensation Committee Report for inclusion in the
proxy statement, in accordance with applicable rules and
regulations; |
| • | otherwise discharge our Board’s responsibilities relating
to compensation of our officers and directors; and |
| • | perform such other functions as our Board may assign to the
committee from time to time. |

In connection with these purposes, our Board has entrusted the Compensation Committee with the overall responsibility for establishing, implementing and monitoring the compensation for our executive officers. In general, executive compensation matters are presented to the Compensation Committee or raised with the Compensation Committee in one of the following ways: (1) at the request of the Compensation Committee Chairman or another Compensation Committee member or member of our Board, (2) in accordance with the Compensation Committee’s agenda, which is reviewed by the Compensation Committee members and other directors on an annual basis, (3) by our Chief Executive Officer or (4) by the Compensation Committee’s outside compensation consultant.

The Compensation Committee works with the management team and our Chief Executive Officer to implement and promote our executive compensation strategy. The most significant aspects of management’s involvement in this process are:

| • | preparing materials in advance of Compensation Committee
meetings for review by the Compensation Committee members; |
| --- | --- |
| • | evaluating employee performance; |
| • | establishing our business goals; and |
| • | recommending the compensation arrangements and components for
our employees. |

Our Chief Executive Officer is instrumental to this process. Specifically, our Chief Executive Officer assists the Compensation Committee by:

•	providing background information regarding our business goals;
•	annually reviewing performance of each of our executive officers
(other than himself); and
•	recommending compensation arrangements and components for our
executive officers (other than himself).

Our other executive officers do not play a role in their own compensation determination, other than discussing individual performance objectives with our Chief Executive Officer.

Pursuant to its charter, the Compensation Committee has the sole authority to retain and terminate any compensation consultant to be used to assist in the evaluation of the compensation of our executive officers and directors and also has the sole authority to approve the consultant’s fees and other retention terms

Together with management and any counsel or other advisors deemed appropriate by the Compensation Committee, the Compensation Committee typically reviews and discusses the particular executive compensation matter presented and makes a final determination.

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To the extent permitted by applicable law, the Compensation Committee may form and delegate some or all of its authority under its charter to subcommittees when it deems such action appropriate.

During the fiscal year ended January 31, 2009, the Compensation Committee held one meeting. The Compensation Committee currently consists of Messrs. Schwalbe, Lewis, Albers and Blum (Chairman).

The report of the Compensation Committee appears under the heading “Compensation Committee Report” below.

Nominating Committee

The purposes of the Nominating Committee, as stated in its charter, include the following:

•	identify individuals qualified to become Board members;
•	recommend to our Board the persons to be nominated by our Board
for election as directors at the annual meeting of
shareholders; and
•	perform such other functions as our Board may assign to the
committee from time to time.

During the fiscal year ended January 31, 2009, the Nominating Committee did not meet. The Nominating Committee consists of Messrs. Schwalbe, Lewis and Blum (Chairman).

Director Nomination Process

The Nominating Committee is responsible for establishing criteria for selecting new directors, actively seeking individuals to become directors and recommending such individuals to our Board. In seeking candidates for our Board, the Nominating Committee will consider the entirety of each candidate’s credentials. Currently, the Nominating Committee does not require director candidates to possess a specific set of minimum qualifications, as different factors may assume greater or lesser significance at particular times and the needs of our Board may vary in light of its composition and the Nominating Committee’s perceptions about future issues and needs. However, while the Nominating Committee does not maintain a formal list of qualifications, in making its evaluation and recommendation of candidates, the Nominating Committee may consider, among other factors, diversity, age, skill, experience in the context of the needs of our Board, independence qualifications, and whether prospective nominees have relevant business and financial experience, have industry or other specialized expertise, and have high moral character.

The Nominating Committee may consider candidates for our Board from any reasonable source, including from a search firm engaged by the Nominating Committee or shareholder recommendations, provided that the procedures set forth below are followed. The Nominating Committee does not intend to alter the manner in which it evaluates candidates based on whether the candidate is recommended by a shareholder or not. However, in evaluating a candidate’s relevant business experience, the Nominating Committee may consider previous experience as a member of our Board.

Shareholders or a group of shareholders may recommend potential candidates for consideration by the Nominating Committee by sending a written request to our Corporate Secretary at Mitcham Industries, Inc., P.O. Box 1175, Huntsville, Texas 77342-1175. For additional information, see “Shareholder Proposals and Director Nominations.”

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

No member of the Compensation Committee is now, or at any time has been, employed by or served as an officer of Mitcham Industries, Inc. or any of its subsidiaries or had any substantial business dealings with Mitcham Industries, Inc. or any of its subsidiaries. None of our executive officers are now, or at any time has been, a member of the compensation committee or board of directors of another entity, one of whose executive officers has been a member of the Compensation Committee or our Board.

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TRANSACTIONS WITH RELATED PERSONS

Policies and Procedures

Historically, our Board has reviewed and approved, as appropriate, related person transactions as they have been put before our Board at the recommendation of management. In May 2007, our Board, recognizing that related person transactions involving our company present a heightened risk of conflicts of interest and/or improper valuation (or the perception thereof), adopted a formal written process for reviewing, approving and ratifying transactions with related persons, which is described below.

General

Under the policy, any “Related Person Transaction” may be consummated or may continue only if:

| • | the Audit Committee approves or ratifies the transaction in
accordance with the guidelines set forth in the policy and if
the transaction is on terms comparable to those that could be
obtained in arm’s length dealings with an unrelated third
party; |
| --- | --- |
| • | the transaction is approved by the disinterested members of our
Board; or |
| • | the transaction involves compensation approved by the
Compensation Committee. |

For these purposes, a “Related Person” is:

| • | a senior officer (which shall include, at a minimum, each
executive vice president and Section 16 officer) or
director; |
| --- | --- |
| • | a shareholder owning more than 5% of our company (or its
controlled affiliates); |
| • | a person who is an immediate family member of a senior officer
or director; or |
| • | an entity which is owned or controlled by someone listed above,
or an entity in which someone listed above has a substantial
ownership interest or control of that entity. |

For these purposes, a “Related Person Transaction” is a transaction between our company and any Related Person (including any transactions requiring disclosure under Item 404 of Regulation S-K under the Exchange Act), other than:

•	transactions available to all employees generally; and
•	transactions involving less than $5,000 when aggregated with all
similar transactions.

Audit Committee Approval

Our Board has determined that the Audit Committee is best suited to review and approve Related Person Transactions. Accordingly, at each calendar year’s first regularly scheduled Audit Committee meeting, management recommends Related Person Transactions to be entered into for that calendar year, including the proposed aggregate value of the transactions (if applicable). After review, the Audit Committee approves or disapproves the transactions and at each subsequently scheduled meeting, management updates the Audit Committee as to any material change to those proposed transactions.

In the event management recommends any further Related Person Transactions subsequent to the first calendar year meeting, the transactions may be presented to the Audit Committee for approval or preliminarily entered into by management subject to ratification by the Audit Committee; provided that if ratification is not forthcoming, management makes all reasonable efforts to cancel or annul the transaction.

Corporate Opportunity

Our Board recognizes that situations exist where a significant opportunity may be presented to management or a member of our Board that may equally be available to our company, either directly or via referral.

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Before the opportunity may be consummated by a Related Person (other than an otherwise unaffiliated 5% shareholder), the opportunity must be presented to our Board for consideration.

Disclosure

All Related Person Transactions are to be disclosed in our applicable filings as required by the Securities and Exchange Commission’s rules and regulations. Furthermore, all Related Person Transactions are to be disclosed to the Audit Committee and any material Related Person Transaction are to be disclosed to the full Board.

Other Agreements

Management assures that all Related Person Transactions are approved in accordance with any requirements of our financing agreements.

Transactions

Since the beginning of the fiscal year ended January 31, 2008, we have not participated in (or proposed to participate in) any transactions with related persons.

STOCK OWNERSHIP MATTERS

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our directors, executive officers and persons who beneficially own more than 10% of our outstanding common stock to file initial reports of ownership and changes in ownership of common stock with the Securities and Exchange Commission. Reporting persons are required by the Securities and Exchange Commission to furnish us with copies of all Section 16(a) forms they file. Based solely on our review of the copies of reports we received and written representations from our directors and officers, we believe that all filings required to be made under Section 16(a) for the fiscal year ended January 31, 2009 were timely made.

Principal Holders of Securities

The following table sets forth the beneficial ownership of the outstanding shares of common stock as of May 27, 2009 with respect to each person, other than our directors and officers, we know to be the beneficial owner of 5% or more of our issued and outstanding common stock.

| Name and Address of Beneficial
Owner (1) | Common Stock Beneficially Owned — Number of Shares | Percent of
Class (2) | |
| --- | --- | --- | --- |
| Pacific Global Investment Management Company | 852,810 | (3) | 8.7 % |
| 101 N. Brand Blvd Suite 1950 Glendale, CA 91203 | | | |
| Greenwood Investments, Inc. | 560,437 | (4) | 5.7 % |
| 420 Boylston Street 5 th Floor Boston, MA 02116 | | | |
| Wellington Management Company, LLP. | 595,334 | (5) | 6.1 % |
| 75 State Street Boston, MA 02109 | | | |

callerid=999 iwidth=456 length=60

| (1) | “Beneficial ownership” is
a term broadly defined by the SEC in Rule 13d-3 under the Exchange Act and includes more than the typical forms
of stock ownership, that is, stock held in the person’s
name. The term also includes what is referred to as
“indirect ownership”, meaning ownership of shares as
to which a person has or shares investment or voting power. For
the purpose of this table, a person or group of persons is
deemed to have “beneficial ownership” of any shares as
of May 27, 2009, if that person or group has the right to
acquire shares within 60 days after such date. |
| --- | --- |
| (2) | Based on total shares outstanding
of 9,802,138 at May 27, 2009. Also based on the number of
shares owned and acquirable within 60 days of May 27,
2009. |

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| (3) | Based solely on a Schedule 13G
filed in February 2009 with the Securities and Exchange
Commission. According to the Schedule 13G, Pacific Global
Investment Management Company, by virtue of its investment
discretion and voting authority granted by certain clients which
may be revoked at any time, and George A. Henning, as a result
of his ownership interest in Pacific Global Investment
Management Company, have sole voting power and sole dispositive
power over 852,810 shares of our common stock. Pacific
Global Investment Management Company and George A. Henning each
specifically disclaim beneficial ownership of such shares of
common stock. |
| --- | --- |
| (4) | Based solely on a Schedule 13G
filed in December 2008 with the Securities and Exchange
Commission. According to the Schedule 13G, the following
reporting persons have sole voting and dispositive power over
560,437 shares of our common stock: Steven Tannenbaum and
Greenwood Investments, Inc. According to the Schedule 13G,
Greenwood Investors Limited Partnership has sole voting and
dispositive power over 267,700 shares of our common stock
and Greenwood Capital Limited Partnership has sole voting and
dispositive power over 292,737 shares of our common stock. |
| (5) | Based solely on a Schedule 13F
filed in May 2009 with the Securities and Exchange Commission.
According to the Schedule 13F, Wellington Management
Company, LLP and Wellington Trust Company, NA have shared
voting power over 595,334 shares of our common stock. |

Security Ownership of Management

The following table sets forth the beneficial ownership of common stock as of May 27, 2009 by (1) each of the executive officers named in the Summary Compensation Table below, (2) each of our directors and director nominees and (3) all current directors and executive officers as a group. All persons listed have sole disposition and voting power with respect to the indicated shares except as otherwise indicated in the footnotes to the table.

| Name of Beneficial
Owner (1) | Common Stock Beneficially Owned — Number of Shares | Percent of
Class (2) | |
| --- | --- | --- | --- |
| Billy F. Mitcham, Jr. | 583,309 | (3) | 5.7 % |
| Peter H. Blum | 570,036 | (4) | 5.6 % |
| John F. Schwalbe | 91,000 | (5) | * |
| R. Dean Lewis | 94,000 | (6) | * |
| Robert J. Albers | 23,000 | (7) | * |
| Paul Guy Rogers | 83,548 | (8) | * |
| Robert P. Capps | 103,930 | (9) | 1.0 % |
| Guy Malden | 35,425 | (10) | * |
| All current directors and executive officers as a group
(8 persons) | 1,584,248 | (11) | 14.6 % |

callerid=999 iwidth=456 length=60

*	Less than 1%
(1)	“Beneficial ownership” is
a term broadly defined by the SEC in Rule 13d-3 under the Exchange Act and includes more than the typical forms
of stock ownership, that is, stock held in the person’s
name. The term also includes what is referred to as
“indirect ownership”, meaning ownership of shares as
to which a person has or shares investment or voting power. For
the purpose of this table, a person or group of persons is
deemed to have “beneficial ownership” of any shares as
of May 27, 2009, if that person or group has the right to
acquire shares within 60 days after such date.
(2)	Based on total shares outstanding
of 9,802,138 at May 27, 2009. Also based on the number of
shares owned and acquirable within 60 days of May 27,
2009.
(3)	Includes 5,000 shares of
restricted stock that vest over one year and an aggregate of
3,100 shares owned by Mr. Mitcham’s spouse. Also
includes shares underlying exercisable options and options that
will become exercisable within 60 days of May 27, 2009
(collectively, the “Exercisable Options”) to purchase
an aggregate of 373,334 shares of common stock.
(4)	Includes 290,000 shares
underlying Exercisable Options, 6,000 shares owned by
Mr. Blum’s spouse’s IRA and 6,500 shares
owned by Mr. Blum’s minor son.
(5)	Includes 85,000 shares
underlying Exercisable Options.
(6)	Includes 85,000 shares
underlying Exercisable Options.
(7)	Includes 20,000 shares
underlying Exercisable Options.
(8)	Includes 2,668 shares of
restricted stock that vest over one year and 72,500 shares
underlying Exercisable Options.
(9)	Includes 1,334 shares of
restricted stock that vest over one year and 90,000 shares
underlying Exercisable Options.
(10)	Includes 2,668 shares of
restricted stock that vest over one year and 26,500 shares
underlying Exercisable Options.
(11)	Includes 1,042,334 shares
underlying Exercisable Options and 11,670 shares of
restricted stock that vest over one year.

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PROPOSAL 1: ELECTION OF DIRECTORS

General

Six individuals will be elected at the Annual Meeting to serve as directors until the next annual meeting, each until their respective successors are duly elected and qualified. Shares or proxies may not be voted for more than five director nominees. Based on recommendations from the Nominating Committee, our Board has nominated the six individuals listed below to serve until our 2010 Annual Meeting of Shareholders. All of the director nominees are currently serving on our Board.

The persons appointed as proxies in the enclosed proxy card will vote such proxy “FOR” the persons nominated for election to our Board, except to the extent authority to vote is expressly withheld with respect to one or more nominees. If any nominee is unable to serve as a director for any reason, all shares represented by proxies pursuant to the enclosed proxy card, absent contrary instructions, will be voted for any substitute nominee designated by our Board.

Our Board recommends a vote “FOR” the election of each of the director nominees identified below.

Information About Director Nominees

The following table sets forth the names and ages, as of May 27, 2009, of our current directors, each of whom is a director nominee. Our directors are elected annually and serve one-year terms or until their death, resignation or removal.

Name — Billy F. Mitcham, Jr.	61	Positions Held — Director, President and Chief Executive Officer	1987
Peter H. Blum	52	Non-Executive Chairman	2000
Robert P. Capps	55	Director, Executive Vice President of Finance and Chief
Financial Officer	2004
R. Dean Lewis	66	Director	1995
John F. Schwalbe	65	Director	1994
Robert J. Albers	68	Director	2008

Billy F. Mitcham, Jr. has served as our President and Chief Executive Officer since our inception in 1987. From 1987 until July 2004, Mr. Mitcham also served as Chairman of our Board. Mr. Mitcham has more than 28 years of experience in the geophysical industry. From 1979 to 1987, he served in various management capacities with Mitcham Associates, an unrelated equipment leasing company. From 1975 to 1979, Mr. Mitcham served in various capacities with Halliburton Services, primarily in oilfield services.

Peter H. Blum was elected Non-Executive Chairman of our Board on July 8, 2004. Mr. Blum is Vice Chairman and Head of Capital Markets of Ladenburg Thalmann & Co., Inc., an investment banking firm. Prior to 2004, Mr. Blum was a senior investment banker with various Wall Street firms. Mr. Blum started his career with Arthur Young & Co. as a C.P.A. and received a Bachelor of Business Administration degree from the University of Wisconson-Madison.

Robert P. Capps has been a member of our Board since July 2004. In June 2006, Mr. Capps was appointed as our Executive Vice President and Chief Financial Officer. From July 1999 until May 2006, he was the Executive Vice President and Chief Financial Officer of TeraForce Technology Corporation (“TeraForce”), a publicly-held provider of defense electronics products. On August 2, 2005, TeraForce filed for protection under Chapter 11 of the Federal Bankruptcy Code. On April 6, 2006, TeraForce’s Chapter 11 Plan of Reorganization was confirmed. From 1996 to 1999, Mr. Capps was Executive Vice President and Chief Financial Officer of Dynamex, Inc., a NASDAQ-listed supplier of same-day transportation services. Prior to his employment with Dynamex, Mr. Capps was Executive Vice President and Chief Financial Officer of Hadson Corporation, a NYSE-listed energy company. Mr. Capps is a Certified Public Accountant and was formerly with Arthur Young & Co. Mr. Capps holds a Bachelor of Accountancy degree from the University of Oklahoma.

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R. Dean Lewis is Special Assistant to Provost and Professor of Marketing at Sam Houston State University. From June 2008 to April 2009 he was the Vice President of Finance and Administration at Sam Houston State University since June 2008. From October 1995 to June 2008, he was the Dean of the Business School at Sam Houston State University. From 1987 to October 1995, Dr. Lewis was the Associate Dean and Professor of Marketing at Sam Houston State University. Prior to 1987, Dr. Lewis held a number of executive positions in the banking and finance industries.

John F. Schwalbe has had a professional career in public accounting for more than 30 years. Mr. Schwalbe’s experience includes auditing of oil and gas exploration and production enterprises, school districts and various banking institutions. Prior to his retirement in 2007, Mr. Schwalbe was in private practice for more than 25 years, with primary emphasis in tax planning, consultation and compliance. Mr. Schwalbe is a Certified Public Accountant and holds a Bachelor of Business Administration degree from Midwestern University.

Robert J. Albers was appointed to our Board in January 2008 based on the recommendation of the Nominating Committee. Mr. Albers currently manages Bob Albers Consulting whereby he acts as corporate management advisor to the management of the Sercel Group, a global manufacturer of geophysical equipment. From 1995 to 2002, he was Executive Vice President of Sercel, Inc. From 1990 to 1994, Mr. Albers served as Vice President and General Manager of Halliburton Geophysical Products. In 1982, he joined Geosource, Inc. and served as President and General Manager, Operations and Technology Group; from 1963 to 1982, he held various management and leadership roles at Chevron Oil Company. Mr. Albers holds a Bachelor of Science degree in Mining Engineering from Lehigh University.

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INFORMATION ABOUT OUR EXECUTIVE OFFICERS

The following table sets forth the names, ages and titles, as of May 27, 2009, of each of our executive officers. Our executive officers are elected annually by our Board and serve one-year terms or until their death, resignation or removal by our Board. There are no family relationships between any of our directors and executive officers. In addition, there are no arrangements or understandings between any of our executive officers and any other person pursuant to which any person was selected as an executive officer.

Name		Positions Held
Billy F. Mitcham, Jr.	61	President and Chief Executive Officer
Robert P. Capps	55	Executive Vice President of Finance and Chief Financial Officer
Paul Guy Rogers	59	Executive Vice President of Business Development
Guy Malden	57	Executive Vice President of Marine Systems

Billy F. Mitcham, Jr.’s biographical information may be located under “Proposal 1: Election of Directors — Information About Director Nominees . ”

Robert P. Capps’ biographical information may be located under “Proposal 1: Election of Directors — Information About Director Nominees . ”

Paul Guy Rogers has served as our Vice President of Business Development since October 2001. From February 1993 to September 2001, Mr. Rogers served as Senior Sales Representative with Geo Space LP, a worldwide manufacturer of geophysical equipment, with responsibilities for sales in the United States and Latin America. Mr. Rogers has 20 years of experience in the geophysical industry.

Guy Malden has served as our Vice President of Marine Systems since January 2004. Mr. Malden has 30 years experience in the geophysical industry and has been with Mitcham Industries since 2002. From 1999 to 2002, he served as Vice President of Operations for American International Exploration Group. From 1993 to 1999, he served in various management capacities with several seismic equipment manufacturers, most notably Syntron, Inc. From 1975 to 1993, Mr. Malden served in various field and management capacities with Geophysical Service Inc./Halliburton Geophysical Services. Mr. Malden holds a degree in Marine Geology from Long Island University.

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COMPENSATION DISCUSSION AND ANALYSIS

Overview of Our Executive Compensation Program

Our business strategy is to meet the needs of the seismic industry by providing leasing services for a wide range of equipment and to provide technologically advanced solutions for marine seismic applications. To achieve this, we leverage one of our key strengths — the expertise of our executive officers.

Our executive compensation program is structured principally around one goal — attracting, motivating and retaining top executive talent with the requisite skills and experience to execute our business strategy. Because we have no direct public competitors in our industry, we compete with many larger companies for top executive-level talent. In addition, we believe our executive officers should be rewarded for executing goals that are designed to increase shareholder value. As a result, the Compensation Committee of our Board (for purposes of this Analysis, the “Committee”) considers company performance measures and evaluates individual performance when determining selected elements of our executive compensation program. These elements consist primarily of base salaries, annual cash incentives and long-term equity-based incentives. The Committee combines the compensation elements for each executive officer in a manner that we believe optimizes the officer’s contribution to our company.

Throughout this proxy statement, the individuals who served as our Chief Executive Officer and Chief Financial Officer during the fiscal year ended January 31, 2009, as well as the other individuals included in the Summary Compensation Table, are referred to as “Named Executive Officers.”

Objectives of Our Executive Compensation Program

We have developed an executive compensation program that is designed to (1) recruit, develop and retain key executive officers responsible for our success and (2) motivate management to enhance long-term shareholder value. To achieve these goals, the Committee’s executive compensation decisions are based on the following principal objectives:

| • | providing a competitive compensation package that attracts,
motivates and retains qualified and highly skilled officers that
are key to our long-term success; |
| --- | --- |
| • | rewarding individual performance by ensuring a meaningful link
between our operational performance and the total compensation
received by our officers; |
| • | balancing the components of compensation so that short-term
(annual) and long-term performance objectives are
recognized; and |
| • | avoiding the creation of an environment that might cause undo
pressure to meet specific financial goals. |

Implementing Our Objectives

Role of the Committee, Management and Compensation Consultant

Our Board of Directors has entrusted the Committee with overall responsibility for establishing, implementing and monitoring our executive compensation program. Our Chief Executive Officer also plays an important role in the executive compensation process, by overseeing the performance and dynamics of the executive team and generally keeping the Committee informed. However, all final decisions regarding our Named Executive Officers’ compensation remain with the Committee, and, in particular, company management has no involvement with the compensation decisions with respect to our Chief Executive Officer. Additional information regarding the role and authority of the Committee and management in the process for determining executive compensation is provided in this proxy statement in “Corporate Governance — Committees of Our Board — Compensation Committee.”

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Determining Compensation

The Committee, which relies upon the judgment of its members in making compensation decisions, has established a number of processes to assist it in ensuring that our executive compensation program supports our objectives and company culture. Among those are competitive benchmarking, assessment of individual and company performance and a total compensation review, which are described in more detail below.

Competitive Benchmarking. Although we have no public direct competitors, the Committee compares our executive pay practices against other companies to assist it in the review and comparison of each element of compensation for our executive officers. This practice recognizes that (1) our compensation practices must be competitive in the marketplace and (2) marketplace information is one of the many factors considered in assessing the reasonableness of our executive compensation program.

The Committee usually begins its competitive market analysis in the first quarter of fiscal the year in which the compensation decisions are made. The Committee only reviews comparative data for base salary and annual cash incentive compensation levels but does not compare equity awards. The comparative compensation data used in the Committee’s analysis is derived by the Compensation Consultant from comprehensive surveys performed by third parties. For the fiscal year ended January 31, 2008, compensation indices from the ECS Industry Report on Top Management Compensation , which was prepared by Watson Wyatt Data Services, and the Salary Assessor , which was prepared by Economic Research Institute, were used in the Committee’s analysis. As part of this analysis, the Committee compared the compensation of our executive officers with the companies in the following groups (collectively, “Peer Companies”):

| • | Companies in all industries with comparable total revenues of
less than $250 million. |
| --- | --- |
| • | Companies in the Oil Services / Equipment Sector with
comparable total revenues of less than $250 million. |

This same data was used as the basis for the analysis for the year ended January 31, 2009.

Because we have no public direct competitors, the Committee believes it is difficult to obtain directly comparable data from which to derive an overall compensation program for our senior managers, including our Named Executive Officers. We do, however, compete for management personnel with a number of companies within the oil field services industry. Given the strong business environment within this industry, a very competitive market for experienced senior management has developed.

In order to compete effectively for this senior level talent, the Committee determined during fiscal 2008 to develop an incentive compensation program for all of our senior managers, including our Named Executive Officers. The Committee examined the public filings of several companies involved in the oil field services industry, including some who are involved in the seismic industry, to determine the nature of incentive compensation programs that they employ. These companies included Bolt Technology Corporation, Geokinetics, Inc., Ion Geophysical Corporation, Omni Energy Services Corp., OYO Geospace Corporation and Basic Energy Services, Inc. The Committee believes these companies represent a sample of companies comparable to ours as well as organizations with which we compete for senior management talent. In particular, these companies are involved in oil field services industry and several are directly involved in the seismic industry, either as service providers or as manufacturers. The Committee also believes that each of these companies has experienced significant growth in recent periods. In addition, several of these companies have international as well as domestic operations. The incentive compensation program adopted by the Committee is described in more detail under “Elements of Our Executive Compensation Program — Annual Incentive Compensation Program.”

Due to the broad responsibilities of our executive officers and our diverse international operations, comparisons of survey data to the job descriptions of our executive officers is sometimes difficult. Furthermore, the complexities of our operations and the skills needed of our executive officers are, we believe, greater than those of most companies with comparable total revenues. Therefore, we at times target base salary and annual cash incentive compensation levels that are in the top quartile of the survey information for our

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Peer Companies. The Committee believes that targeting this level of compensation helps to meet our overall total rewards strategy and executive compensation objectives outlined above.

Assessment of Individual and Company Performance. We believe that a balance of individual and company performance criteria should be used in establishing total compensation. Company performance determines a portion of amounts earned under our annual incentive compensation program and is a major factor in the value of equity-based compensation. Individual performance is the primary determining factor in establishing base salaries, as well as a significant portion of our annual incentive compensation program. These performance measures are discussed in more detail below.

Total Compensation Review. Each year, the Committee reviews each executive officer’s base salary, annual cash incentive and long-term equity-based incentives. In addition to these primary compensation elements, the Committee periodically reviews perquisites and other compensation as well as payments that would be required under employment agreements and our equity-based plans. Following its 2008 review, the Committee determined that these elements of compensation were reasonable in the aggregate in relation to the market data analyzed by the Committee.

Elements of Our Executive Compensation Program

The Committee evaluates both performance and compensation to ensure that we maintain our ability to attract and retain superior employees in key positions and that compensation provided to our key employees remains competitive relative to the compensation paid to similarly situated executive officers of our Peer Companies. In furtherance of these goals, our executive compensation program consists primarily of three basic components:

•	base salaries;
•	annual incentive payments; and
•	long-term equity-based incentives.

The distribution of compensation among the various components of compensation is driven by our belief that a significant portion of each Named Executive Officer’s compensation should be at risk. The practice of emphasizing variable compensation suits our philosophy of linking pay to performance, both on an individual and entity level.

The following table shows the allocation of base salary, annual cash incentives and long-term equity-based incentives among fixed, short-term variable and long-term variable compensation for our Named Executive Officers for the fiscal year ended January 31, 2009:

			Short-Term — Variable	Long-Term — Variable
Named Executive		Fixed	(Annual Cash	(Equity-Based
Officer	Title	(Base Salary)	Incentives)	Incentives)
Billy F. Mitcham, Jr.	President and Chief Executive Officer	45 %	23 %	32 %
Robert P. Capps	Executive Vice President and Chief Financial Officer	41 %	16 %	43 %
Paul Guy Rogers	Vice President Business Development	51 %	18 %	31 %
Guy Malden	Vice President Marine Systems	50 %	20 %	30 %

The distribution of compensation between (1) the fixed element of base salary and the variable elements of annual cash incentives and long-term equity-based incentives and (2) the total mix of cash and equity compensation is primarily influenced by the Committee’s competitive market analysis and its desire to balance short-term and long-term goals. The distribution of compensation between short-term and long-term variable compensation is primarily influenced by the Committee’s desire to provide our executive officers a longer-term stake in our company, act as a long-term retention tool and align employee and shareholder interests by aligning compensation with growth in shareholder value.

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Base Salaries

We provide our executive officers and other employees with an annual base salary to compensate them for services rendered during the year. Our philosophy has been to establish base salaries near the top range of such salaries at the Peer Companies.

In addition to providing a base salary that is competitive with the market, we target salary compensation to align each of our Named Executive Officer’s salary level relative to the other officers so that it accurately reflects each officer’s relative skills, responsibilities, experiences and contributions to our company. To that end, annual salary adjustments are based on a subjective analysis of many individual factors, including:

•	the responsibilities of the officer;
•	period over which the officer has performed these
responsibilities;
•	the scope, level of expertise and experience required for the
officer’s position;
•	the strategic impact of the officer’s position; and
•	the potential future contribution and demonstrated individual
performance of the officer.

In addition to individual factors listed above, the Committee considers our overall business performance, such as our earnings before interest, taxes, depreciation and amortization (or EBITDA), leasing growth, sales growth and implementation of directives. While these metrics generally provide context for making salary decisions, base salaries decisions do not depend on attainment of specific goals or performance levels and no specific weighting is given to one factor over another.

Base salaries are generally reviewed annually, but are not automatically increased if the Committee believes that the other elements of compensation are more appropriate in light of its stated objectives. After consideration of the factors described above, the Committee approved increases in the annual base salary of approximately 9.5% to 11.8% effective July 1, 2007 and 8.0% effective July 1, 2008. We believe that these salaries are consistent with our objective of providing base salaries near the top range of such salaries at the Peer Companies. The Committee specifically considered increased experience and years of service when granting these salary increases.

The following table provides the base salaries for our Named Executive Officers in fiscal years 2008 and 2009 and the percentage increase in their 2009 base salary from their 2008 base salary:

Named Executive Officer	2007 Base Salary	2008 Base Salary	Percentage — Increase	2009 Base Salary	Percentage — Increase
Billy F. Mitcham, Jr.	$ 335,000	$ 370,000	9.5 %	$ 399,600	8.0 %
Robert P. Capps	$ 175,000	$ 195,000	10.3 %	$ 210,600	8.0 %
Paul Guy Rogers	$ 175,000	$ 195,000	10.3 %	$ 210,600	8.0 %
Guy Malden	$ 172,000	$ 195,000	11.8 %	$ 210,600	8.0 %

Bonus Awards

In order to achieve the goals of our compensation program, specifically providing a competitive compensation program and avoiding an environment that might cause undo pressure to meet specific financial goals, we awarded each of the Named Executive Officers a discretionary cash bonus for the fiscal year ended January 31, 2009. In April 2009 a discretionary bonus was awarded to each of our Named Executive Officers in addition to the discretionary amounts provided for in our Annual Incentive Compensation Program. These awards were based upon the individual contributions of each of the Named Executive Officers. The amount of each of the awards was determined based upon our subjective analysis of each individuals contributions. The Committee deemed these awards appropriate and necessary in light of the effect of unprecedented global economic developments on amounts earned under our Annual Incentive Compensation Program and on the value of previously awarded equity-based incentives. The Committee considered these awards an important factor in avoiding an environment that might cause undo pressure to meet financial goals or expectations. The

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awards to each Named Executive Officer under this discretionary component bonus are reflected in the “Bonus” column of the Summary Compensation Table for the year ended January 31, 2009.

In December 2008, a discretionary bonus was awarded to each of our Named Executive Officers in connection with holiday bonuses given all of our U.S. based employees. These bonus awards are immaterial in amount and ranged in size from 2.0% to 1.0% of base salary. The amounts awarded to our Named Executive Officers during the fiscal year ended January 31, 2008 are set forth in the “Bonus” column of the Summary Compensation Table.

Annual Incentive Compensation Program

For the reasons set forth above under “— Implementing Our Objectives — Determining Compensation,” the Committee approved an annual incentive compensation program in October 2007 for our senior managers, including, but not limited to, our Named Executive Officers. The program provides for incentive payments (“Performance Awards”) based partially on attainment of corporate-wide financial goals and partially on discretionary factors. The program further provides for payment of a portion of the earned amounts in cash and a portion in phantom shares, as more fully described below. The Committee wanted to provide for a portion of the potential payments based upon attainment of corporate-wide financial goals in order to provide an incentive to our senior managers that was aligned with the financial success of our company as a whole. At the same time, the Committee felt it was important to provide for a discretionary portion of potential payments in order to provide flexibility to recognize contributions made by individual officers that may not be reflected in corporate-wide financial results. The Committee believed that providing a significant discretionary component would mitigate any undue pressure on the officers to achieve specific corporate financial goals. Further, the Committee determined that a portion of any earned amounts should be paid in our common stock and that a service period should be required before such common stock could be sold. The Committee believed this feature would help align the goals of our senior managers with our shareholders over a longer period of time.

The program consists of three components, each of which is described in more detail below. The total value of the combined payments made under the three components may not exceed 100% of each Named Executive Officer’s base salary. We determined this amount to be appropriate given the other components of our total compensation program and the size of the awards granted by other companies with similar incentive programs. Each of our Named Executive Officers must remain an employee of our company as of May 15, 2009 to receive payments under the program. If the officer’s employment terminates due to death or disability after May 15, 2009 but prior to May 15, 2010, he will immediately vest in any phantom shares awarded and be paid in common stock at that time. If the officer’s employment is terminated for any other reason after May 15, 2009 but prior to May 15, 2010, he will forfeit his phantom shares.

Under the first component of the program (the “Threshold Component”), each of our Named Executive Officers is entitled to receive an amount equal to 20% of his base salary if our consolidated earnings before income taxes for the fiscal year ended January 31, 2008 (the “Actual Earnings”) is equal to or greater than 90% of the target amount (the “Earnings Target”) established by the Committee. For fiscal 2009, the Earnings Target was $22,250,000. At the time the Earnings Target was established the Committee believed this was an aggressive, yet achievable, target in light of industry and general economic conditions then in effect. This amount represented an increase of approximately 31% over the comparable amount actually achieved in fiscal 2008.

Under the second component of the program (the “Incentive Pool Component”), each of our Named Executive Officers is entitled to receive his pro-rata share of an incentive pool that is equal to 20% of (1) our Actual Earnings less (2) the Earnings Target. The Named Executive Officer’s pro-rata share of the incentive pool is calculated by multiplying the aggregate amount of the incentive pool by the ratio of the officer’s salary compared to the aggregate salaries of all recipients of Performance Awards. However, the officer’s pro rata share of the incentive pool may not exceed 55% of his base salary.

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Two-thirds of the amount earned under the first and second components of our annual incentive program is payable in cash and one-third is payable in phantom stock (the “Equity Payout Value”). The number of phantom shares is determined by dividing the Equity Payout Value by the trading price of our common stock on the date the award is made. The result is the number of phantom shares, rounded to the next highest whole number, which is granted to the officer. The phantom stock vests one year from the date of grant and, upon vesting, convert into an equal number of shares of common stock.

Actual Earnings for fiscal 2009 were $12,155,000. Accordingly, no amounts were earned in fiscal 2009 pursuant to the Threshold Component or the Incentive Pool Component.

Under the third component of the program (the “Discretionary Component”), each of our Named Executive Officers is entitled to receive a cash payment equal up to 25% of his annual base salary at the discretion of the Committee. The amount earned by each officer under this component is based on a subjective analysis of his individual contributions as determined by the Committee. Factors considered in determining the amount for fiscal 2009 included non-financial operational results and accomplishments in each Named Executive Officers’ area of responsibility, specific challenges faced by the Named Executive Officer and how those challenges were addressed. The awards earned by each Named Executive Officer under this discretionary component of the program during the fiscal year ended January 31, 2009 are reflected in the “Bonus” column of the Summary Compensation Table.

Long-Term Equity-Based Incentives

Our long-term equity-based incentive program is designed to give our key employees a longer-term stake in our company, act as a long-term retention tool and align employee and shareholder interests by aligning compensation with growth in shareholder value. To achieve these objectives, we generally rely on a combination of grants of stock options and restricted stock, which are made pursuant to the Mitcham Industries, Inc. Stock Awards Plan.

In determining the level of equity-based compensation, the Committee makes a subjective determination based on the same factors that are used to determine the discretionary portion of the annual cash incentives described above. In addition, when deciding whether to award restricted stock versus stock options, the Committee considers the total amount of awards and attempts to maintain a balance between the restricted stock and stock options held by each executive officer. Providing an equal number of restricted stock and stock options balances the Committee’s concern that equity awards serve as a retention tool while also serving as an incentive to increase shareholder value expectation that each Named Executive Officer would focus his efforts on improving our stock price performance. Existing ownership levels are not a factor in the total award determination, as we do not want to discourage executives from holding significant amounts of our common stock.

The Committee made no grants of long-term equity-based incentive grants awarded to our Named Executive Officers during the fiscal year ended January 31, 2009. However, we believe that the previously granted vested and unvested long-term equity-based awards continue to both provide meaningful incentives for our Named Executive Officers and satisfy the objectives of our compensation program. In addition, we believe that Annual Incentive Compensation Program, a portion of which is paid in phantom shares, provides a component of long-term equity-based awards.

Other Benefits

In addition to base salaries, annual cash incentives and long-term equity-based incentives, we provide the following forms of compensation:

• Health and Welfare Benefits. Our executive officers are eligible to participate in medical, dental, vision, disability insurance and life insurance to meet their health and welfare needs. These benefits are provided so as to assure that we are able to maintain a competitive position in terms of attracting and retaining officers and other employees. This is a fixed component of compensation and the benefits are provided on a non-discriminatory basis to all of our employees in the United States.

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• Perquisites and Other Personal Benefits. We believe that the total mix of compensation and benefits provided to our executive officers is competitive and perquisites should generally not play a large role in our executive officers’ total compensation. As a result, the perquisites and other personal benefits we provide to our executive officers are limited. Pursuant to our employment agreement with Mr. Mitcham, we maintain a term life insurance policy in an amount equal to at least three times his annual salary. In addition, we pay for club membership privileges that are used for business and personal purposes by Mr. Mitcham. We also provide each of Messrs. Mitcham, Rogers and Malden with the use of a company-owned automobile, as they are required to drive considerable distances in order to visit existing and potential customers. All of our executive officers participate in our 401(K) retirement plan that is available to all of our employees in the United States.

Employment Agreements, Severance Benefits and Change in Control Provisions

Employment Agreement with Billy F. Mitcham, Jr.

We maintain an employment agreement with our President and Chief Executive Officer, Mr. Mitcham, to ensure that he will perform his role for an extended period of time. This agreement is described in more detail elsewhere in this proxy statement. Please read “Executive Compensation — Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table — Employment Agreement with Billy F. Mitcham, Jr.” This agreement provides for severance compensation to be paid if the employment of Mr. Mitcham is terminated under certain conditions, such as constructive termination and termination without cause, each as defined in the agreement.

The employment agreement between Mr. Mitcham and us and the related severance provisions are designed to meet the following objectives:

| • | Constructive Termination. In certain scenarios, the
potential for merger or being acquired may be in the best
interests of our shareholders. As a result, we have agreed to
provide severance compensation to Mr. Mitcham if he
terminates his employment within 60 days following a
“constructive termination” (as defined in the
employment agreement) to promote his ability to act in the best
interests of our shareholders even though his duties and
responsibilities could be changed as a result of the transaction. |
| --- | --- |
| • | Termination without Cause. If we terminate
Mr. Mitcham’s employment without cause, we are
obligated to pay him certain compensation and other benefits as
described in greater detail in “Potential Payments upon
Termination or Change in Control” below. We believe these
payments are appropriate because Mr. Mitcham is bound by
confidentiality, non-solicitation and non-compete provisions for
a period of two years after termination and because
Mr. Mitcham and we have mutually agreed to a severance
package that is in place prior to any termination event. This
provides us with more flexibility to make a change in senior
management if such a change is in our and our shareholders’
best interests. |

We believe that the triggering events under Mr. Mitcham’s employment agreement represent the general market triggering events found in employment agreements of companies against whom we compete for executive-level talent at the time they were negotiated.

Equity-Based Plans

Under the terms of our equity incentive plans, any unvested grants will become vested and, in the case of stock options, exercisable, upon the executive officer’s death or disability or upon a change in control of our company (as defined in the applicable award agreement). We believe these triggering events represent the general market triggering events found in comparable agreements of companies against whom we compete for executive-level talent.

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Other Matters

Stock Ownership Guidelines and Hedging Prohibition

Stock ownership guidelines have not been implemented by the Committee for our executive officers. Our Insider Stock Trading Policy discourages, but does not prohibit, executive officers from entering into certain derivative transactions related to our common stock, including transactions in put and call options. We will continue to periodically review best practices and re-evaluate our position with respect to stock ownership guidelines and hedging prohibitions.

Tax Treatment of Executive Compensation Decisions

Our Board has not yet adopted a policy with respect to the limitation under Section 162(m) of the Internal Revenue Code (the “Code”), which generally limits our ability to deduct compensation in excess of $1,000,000 to a particular executive officer in any year.

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COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed the disclosure set forth above under the heading “Compensation Discussion and Analysis” with management and, based on the review and discussions, it has recommended to the Board of Directors that the “Compensation Discussion and Analysis” be included in this proxy statement and incorporated by reference into Mitcham Industries, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009.

Respectfully submitted by the Compensation Committee,

Peter H. Blum (Chairman) Robert J. Albers R. Dean Lewis John F. Schwalbe

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EXECUTIVE COMPENSATION

Summary Compensation

The following table summarizes, with respect to our Named Executive Officers, information relating to the compensation earned for services rendered in all capacities. Our Named Executive Officers consist of our four current executive officers, including our Chief Executive Officer and Chief Financial Officer.

Summary Compensation Table for the Year Ended January 31, 2009

Name and	Fiscal Year — Ended			Stock	Option		Incentive Plan		All Other
Principal Position	January 31,	Salary	Bonus	Awards (1)	Awards (2)		Compensation (3)		Compensation		Total
		($)	($)	($)	($)		($)		($)		($)
Billy F. Mitcham, Jr .	2009	387,267	204,139	(4)	88,850	186,256		—		85,133	(6)	951,645
President and Chief Executive Officer	2008	352,500	92,314	(4)	127,906	257,227		224,578	(5)	76,671	(6)	1,131,196
	2007	322,500	89,794	(4)	52,447	330,601		—		75,139	(6)	870,481
Robert P. Capps	2009	204,100	79,238	(8)	17,066	200,232		—		8,164	(11)	508,800
Executive Vice President and Chief	2008	185,000	48,314	(8)	13,563	278,998		118,359	(10)	—	(12)	644,234
Financial
Officer (7)	2007	105,449	54,503	(8)	—	277,469	(9)	—		12,500	(11)	449,921
Paul Guy Rogers	2009	204,100	69,188	(13)	35,241	88,631		—		10,639	(15)	407,799
Vice President Business Development	2008	185,000	33,689	(13)	55,159	91,091		118,359	(14)	—	(12)	483,298
	2007	170,833	54,889	(13)	19,716	93,229		—		—	(12)	338,667
Guy Malden	2009	204,100	79,040	(16)	35,241	88,631		—		10,892	(18)	417,904
Vice President Marine Systems	2008	183,500	48,314	(16)	55,159	91,091		118,359	(17)	—	(12)	496,423
	2007	167,833	54,368	(16)	17,545	92,451		—		—	(12)	332,197

callerid=999 iwidth=456 length=60

| (1) | This column includes the dollar
amount of compensation expense we recognized for the fiscal year
ended January 31, 2009 in accordance with Financial
Accounting Standards Board’s Statement of Financial
Accounting Standards (“SFAS”) No. 123R,
“Share-Based Payment” (“FAS 123R”).
Pursuant to the Securities and Exchange Commission’s rules
and regulations, the amounts shown exclude the impact of
estimated forfeitures related to service-based vesting
conditions. These amounts reflect our accounting expense for
these awards, and do not correspond to the actual value that
will be recognized by our Named Executive Officers. Assumptions
used in the calculation of these amounts are included in
Note 13 to our audited financial statements for the fiscal
year ended January 31, 2009 included in our Annual Report
on Form 10-K. The awards for which compensation expense was recognized consist
of awards granted on (a) March 31, 2006 and
September 11, 2006 to Messrs. Mitcham, Rogers and
Malden; and (b) July 12, 2007 to Messrs. Mitcham,
Capps, Rogers and Malden. See “Narrative Disclosure to
Summary Compensation Table and Grants of Plan-Based Awards
Table” below for a description of the material features of
these awards. |
| --- | --- |
| (2) | This column includes the dollar
amount of compensation expense we recognized for the fiscal year
ended January 31, 2009 in accordance with FAS 123R.
Pursuant to the Securities and Exchange Commission’s rules
and regulations, the amounts shown exclude the impact of
estimated forfeitures related to service-based vesting
conditions. These amounts reflect our accounting expense for
these awards, and do not correspond to the actual value that
will be recognized by our Named Executive Officers. Assumptions
used in the calculation of these amounts are included in Note 13
to our audited financial statements for the fiscal year ended
January 31, 2009 included in our Annual Report on Form 10-K. The awards for which compensation expense was recognized consist
of awards granted on (a) January 31, 2005 and
March 31, 2006 to Messrs. Mitcham, Rogers and Malden;
(b) June 26, 2006 to Mr. Capps; and
(c) September 7, 2007 to Messrs. Mitcham, Capps,
Malden and Rogers. See “Narrative Disclosure to Summary
Compensation Table and Grants of Plan-Based Awards Table”
below for a description of the material features of these awards. |
| (3) | Includes amounts earned pursuant to
the performance-based components of our Stock Awards Plan. See
“Compensation Discussion and Analysis — Annual
Incentive Compensation Program.” |
| (4) | Amount for 2009 consists of $99,900
discretionary cash award paid in May 2009 under the annual
incentive compensation program, $100,100 discretionary cash
bonus paid in May 2009 and holiday cash bonus of $4,139 paid in
December 2008. Amount for 2008 consists of $87,875 discretionary
cash award paid in May 2008 under the annual incentive
compensation program and holiday cash bonus of $4,439 paid in
December 2007. Amount for 2007 consists of discretionary cash
bonus of $85,000 paid in July 2007 and holiday cash bonus of
$4,439 paid in December 2006. |
| (5) | Consists of performance-based
awards of $149,719 payable in cash $74,859 payable in Phantom
Stock Units under the annual incentive compensation program. |
| (6) | For the year ended January 31,
2009, includes life insurance premiums of $69,000, automobile
costs of $1,127, country club dues of $5,406 and matching
contributions to our 401(k) plan of $9,600. For the year ended
January 31, 2008, includes life insurance premiums of
$69,000, automobile costs of $1,126, country club dues of $5,312
and matching contributions to our 401(k) retirement plan of
$1,233. For the year ended January 31, 2007, includes life
insurance premiums of $69,000, automobile costs of $1,126 and
country club dues of $5,013 Automobile costs are determined by
multiplying the Alternative Lease Value, as published by the
Internal Revenue Service, by the percentage of personal use
mileage versus total mileage for the year. |

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| (7) | Mr. Capps has served as a
member of our Board since July 2004. On June 26, 2006, he
also assumed the position of Executive Vice President and Chief
Financial Officer. |
| --- | --- |
| (8) | Amount for 2009 consists of $52,650
discretionary cash award paid in May 2009 under the annual
incentive compensation program, $22,350 discretionary cash bonus
paid in May 2009 and holiday cash bonus of $4,238 paid in
December 2008. Amount for 2008 consists of $43,875 discretionary
cash award paid in May 2008 under the annual incentive
compensation program and holiday cash bonus of $4,439 paid in
December 2007. Amount for 2007 consists of discretionary cash
bonus of $50,000 paid in July 2007 and holiday cash bonus of
$4,439 paid in December 2006. |
| (9) | Includes $73,355 related to awards
made in connection with Mr. Capps’ role as a director
before he became an executive officer. |
| (10) | Consists of performance-based
awards of $78,906 payable in cash and $39,453 payable in Phantom
Stock Units under the annual incentive compensation program. |
| (11) | For the year ended January 31,
2009, represents matching contributions to our 401(k) plan. For
the year ended January 31, 2007, represents “Fees
Earned or Paid in Cash” to Mr. Capps as a member of
our Board for the period prior to his becoming an executive
officer. |
| (12) | Value of all other compensation is
less than $10,000 in the aggregate. |
| (13) | Amount for 2009 consists of $52,650
discretionary cash award paid in May 2009 under the annual
incentive compensation program, $12,350 discretionary cash bonus
paid in May 2009 and holiday cash bonus of $4,188 paid in
December 2008. Amount for 2008 consists of $29,250 discretionary
cash award paid in May 2008 under the annual incentive
compensation program and holiday cash bonus of $4,439 paid in
December 2007. Amount for 2007 consists of discretionary cash
bonus of $50,000 paid in July 2007 and holiday cash bonus of
$4,489 paid in December 2006. |
| (14) | Consists of performance-based
awards of $78,906 payable in cash and $39,453 payable in Phantom
Stock Units under the annual incentive compensation program. |
| (15) | Consists of matching contributions
to our 401(k) plan of $8,164 and automobile costs of $2,475. |
| (16) | Amount for 2009 consists of $52,650
discretionary cash award paid in May 2009 under the annual
incentive compensation program, $22,350 discretionary cash bonus
paid in May 2009 and holiday cash bonus of $4,040 paid in
December 2008. Amount for 2008 consists of $43,875 discretionary
cash award paid in May 2008 under the annual incentive
compensation program and holiday cash bonus of $4,439 paid in
December 2007. Amount for 2007 consists of discretionary cash
bonus of $50,000 paid in July 2007 and holiday cash bonus of
$4,368 paid in December 2006. |
| (17) | Consists of performance-based
awards of $78,906 payable in cash and $39,453 payable in Phantom
Stock Units under the annual incentive compensation program. |
| (18) | Consists of matching contributions
to our 401(k) plan of $8,164 and automobile costs of $2,728 |

Grants of Plan-Based Awards

The following table provides information concerning each grant of an award made to our Named Executive Officers under any plan, including awards, if any, that have been transferred during the fiscal year ended January 31, 2009.

Grants of Plan-Based Awards for the Year Ended January 31, 2009

		All Other
		Stock	All Other
		Awards:	Option		Grant Date
		Number	Awards:	Exercise or	Fair
		of	Number	Base	Value of
		Shares of	of Securities	Price of	Stock and	Estimated Future Payments Under
	Grant	Stock or	Underlying	Option	Option	Non-Equity Incentive Plan Awards
Name	Date	Units	Options	Awards	Awards	Threshold	Target	Maximum
		(#)	(#)	($/Sh)	($)	($)	($)	($)
Billy F. Mitcham, Jr.	5-15-08					—	—	79,920	(1)
						—	—	219,780	(2)
Robert P. Capps	5-15-08					—	—	42,120	(1)
						—	—	115,830	(2)
Paul Guy Rogers	5-15-08					—	—	42,120	(1)
						—	—	115,830	(2)
Guy Malden	5-15-08					—	—	42,120	(1)
						—	—	115,830	(2)

callerid=999 iwidth=456 length=60

(1) Under the Threshold Component of our Annual Incentive Compensation Program each Named Executive will receive an award equal to 20% of his base salary if our earnings before income taxes for the year ended January 31, 2009 equals or exceeds 90% of the

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| | Earnings Target. Two-thirds of the
award is payable in cash and one-third is payable in Phantom
Stock units. The number of phantom shares is determined by
dividing the cash value of the award by the trading price of our
common stock on the date the award is made. See
“— Annual Incentive Compensation Program”
under “Compensation Discussion and Analysis” for a
more complete description of this award. |
| --- | --- |
| (2) | Under the Incentive Pool Component
of our Annual Incentive Compensation Program each Named
Executive will receive an additional award should our earnings
before income taxes for the year ended January 31, 2009
exceed the Earnings Target. The amount of this award will be
equal to each Named Executives pro-rata share of an incentive
pool amount, based on the base salary of all participants in the
program. The incentive pool amount will be equal to 20% of the
excess, if any, of earnings before income taxes for the year
ended January 31, 2009 over the Earnings Target. In no
event, however will a participant’s award exceed 55% of his
base salary. Two-thirds of the award is payable in cash and
one-third is payable in Phantom Stock units. The number of
phantom shares is determined by dividing the cash value of the
award by the trading price of our common stock on the date the
award is made. See “— Annual Incentive
Compensation Program” under “Compensation Discussion
and Analysis” for a more complete description of this award. |

Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table

The following is a discussion of material factors necessary to an understanding of the information disclosed in the Summary Compensation Table and the Grants of Plan-Based Awards Table.

Long-Term Equity-Based Incentive Compensation

In July 2007, the Compensation Committee granted Messrs. Mitcham, Capps, Rogers and Malden restricted stock pursuant to our Stock Awards Plan. In September 2007, the Compensation Committee granted Messrs. Mitcham, Capps, Rogers and Malden stock options pursuant to our Stock Awards Plan. For a description of the grants, including the vesting schedule for the stock options and the dates that the restrictions lapse on the restricted stock, please see “Compensation Discussion and Analysis — Elements of Our Executive Compensation Program — Long-Term Equity-Based Incentives.”

Salary and Cash Incentive Awards in Proportion to Total Compensation

The following table sets forth the percentage of each Named Executive Officer’s total compensation that we paid in the form of base salary and bonus.

Name	Year	Percentage of Total — Compensation
Billy F. Mitcham, Jr.	2009	62 %
	2008	41 %
	2007	47 %
Robert P.
Capps (1)	2009	56 %
	2008	36 %
	2007	35 %
Paul Guy Rogers	2009	67 %
	2008	45 %
	2007	67 %
Guy Malden	2009	68 %
	2008	47 %
	2007	67 %

callerid=999 iwidth=456 length=60

(1) Mr. Capps has served as a member of our Board since July 2004. On June 26, 2006, he also assumed the position of Executive Vice President and Chief Financial Officer.

Employment Agreement with Billy F. Mitcham, Jr.

Effective January 15, 1997, we entered into an employment agreement with Mr. Mitcham for a term of five years, beginning January 15, 1997, which term is automatically extended for successive one-year periods unless either party gives written notice of termination at least 30 days prior to the end of the current term. The

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agreement provides for an annual salary of $150,000 subject to increase by our Board. Pursuant to the employment agreement, we are required to maintain a term life insurance policy in an amount equal to at least three times Mr. Mitcham’s annual salary.

Outstanding Equity Awards Value at Fiscal Year-End Table

The following table provides information concerning unexercised options, stock that has not vested, and equity incentive plan awards for our Named Executive Officers.

Outstanding Equity Awards as of January 31, 2009

	Option Awards
	Number of	Number of
	Securities	Securities
	Underlying	Underlying			Number of	Market Value of
	Unexercised	Unexercised	Option	Option	Shares or Units	Shares or Units
	Options	Options	Exercise	Expiration	of Stock That	of Stock That
Name	(#) Exercisable	(#) Unexercisable	Price	Date	Have Not Vested	Have Not Vested
			($)		(#)	($)
Billy F. Mitcham, Jr.	70,500	—		3.56	2-23-09
	45,000	—		5.13	7-27-10
	80,000	—		5.00	7-18-11
	85,000	—		1.99	8-15-12
	30,000	—		1.90	7-17-13
	25,000	—		4.16	7-13-14
	50,000	—		6.18	1-31-15
	33,333	16,667	(1)	16.64	3-31-16
	8,334	16,666	(2)	17.70	9-07-17
					13,161 (3	)	47,643
Robert P.
Capps (4)	25,000	—		8.98	7-21-15
	40,000	40,000	(5)	12.57	6-26-16
	5,000	10,000	(2)	17.70	9-07-17
					3,264 (6	)	11,816
Paul Guy Rogers	10,000	—		4.60	10-23-11
	20,000	—		1.99	8-15-12
	12,500	—		1.90	7-7-13
	10,000	—		6.18	1-31-15
	10,000	5,000	(1)	16.64	3-31-16
	5,000	10,000	(2)	17.70	9-07-17
					5,931 (7	)	21,471
Guy Malden	6,500	—		6.18	1-31-15
	10,000	5,000	(1)	16.64	3-31-16
	5,000	10,000	(2)	17.70	9-07-17
					5,931 (7	)	21,471

callerid=999 iwidth=456 length=60

| (1) | The underlying option shares for
the remaining unexercisable stock options granted on
March 31, 2006 became exercisable on March 31, 2009. |
| --- | --- |
| (2) | One-half of the underlying option
shares for the remaining unexercisable stock options granted on
September 7, 2007 will become exercisable on each of
September 7, 2009 and September 7, 2010. |
| (3) | The remaining 2,500 shares of
unvested restricted stock awards granted on March 31, 2006
vested on March 31, 2009. The remaining 3,000 shares
of unvested restricted stock awards granted on
September 11, 2006 will vest on September 11, 2009.
The remaining |

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| | unvested stock awards granted on
July 12, 2007 will vest as follows: 2,000 shares on
July 12, 2009 and 2,000 shares on July 12, 2010.
Includes 3,661 phantom stock units that vest on May 15,
2009. |
| --- | --- |
| (4) | Mr. Capps has served as a
member of our Board since July 2004. On June 26, 2006, he
also assumed the position of Executive Vice President and Chief
Financial Officer. |
| (5) | The underlying option shares for
the remaining unexercisable stock options granted on
June 26, 2006 will become exercisable as follows:
20,000 shares on June 26, 2009 and 20,000 shares
on June 26, 2010. |
| (6) | The remaining unvested restricted
stock awards granted on July 12, 2007 will vest as follows:
667 shares on July 12, 2009 and 667 shares on
July 12, 2010. Includes 1,930 phantom stock units that vest
on May 15, 2009. |
| (7) | The remaining 667 shares of
unvested restricted stock awards granted on March 31, 2006
vested on March 31, 2009. The remaining 2,000 shares
of unvested restricted stock awards granted on
September 11, 2006 will vest on September 11, 2009.
The remaining unvested stock awards granted on July 12,
2007 will vest as follows: 667 shares on July 12, 2009
and 667 shares on July 12, 2010. Includes 1,930
phantom stock units that vest on May 15, 2009. |

Option Exercises and Stock Vested

The following table provides information concerning each exercise of stock option and each vesting of stock, including restricted stock, restricted stock units and similar instruments, during the fiscal year ended January 31, 2009 on an aggregated basis with respect to each of our Named Executive Officers.

Option Exercises and Stock Vested for the Year Ended January 31, 2009

	Option Awards — Number of Shares	Value Realized	Stock Awards — Number of Shares	Value Realized
Name	Acquired on Exercise	Exercise	Acquired on Vesting	on Vesting
	(#)	($)	(#)	($)
Billy F. Mitcham, Jr.	—	—	7,500	113,730
Robert P. Capps	—	—	666	10,809
Paul Guy Rogers	—	—	3,333	47,157
Guy Malden	—	—	3,333	47,157

Potential Payments upon Termination or Change in Control

We have entered into arrangements with certain of our Named Executive Officers that provide additional payments and/or benefits upon a change in control of our company and/or in connection with the termination of the Named Executive Officer’s employment. For our Chief Executive Officer, Mr. Mitcham, these agreements include both an employment agreement and the award agreements that govern his equity awards. For the remaining Named Executive Officers, these agreements consist solely of the award agreements governing the officers’ equity awards. The following is a discussion of each of these arrangements and their applicability to a termination of employment and/or a change in control of our company. Unless otherwise provided, the dollar amounts disclosed assume that the triggering event for the payment(s) and/or benefit(s) was January 31, 2009, and the value of our stock on that day was $3.62. As a result, the dollar amounts disclosed are merely estimates of the amounts or benefits that would be payable to the Named Executive Officers upon their termination or a change in control of our company. The actual dollar amounts can only be determined at the time of the Named Executive Officer’s termination or the change in control.

Equity-Based Plans and Awards

The phantom shares awarded to our Named Executive Officers as partial payment of their annual incentive compensation are granted pursuant to the Stock Awards Plan. Phantom shares, stock options and shares of restricted stock awarded to the Named Executive Officers under our 1998 Amended and Restated Stock Awards Plan and our Stock Awards Plan will become vested and, in the case of stock options, exercisable, upon the Named Executive Officer’s death or disability or upon a change in control of our company. The equity awards will be cancelled without payment if the Named Executive Officer is terminated for cause, or for a reason other than death or disability.

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For purposes of our equity compensation plans, termination for cause shall result if: (1) the officer acts dishonestly and the direct or indirect consequence of such action is a personal enrichment to that executive, (2) the officer is unable to perform his duties in a satisfactory manner or (3) the officer fails to consistently perform his duties at a level that our Board has, by written notice, informed the officer is expected from him. An officer will be considered “disabled” if he becomes entitled to benefits under our long-term disability plan.

Pursuant to our Stock Awards Plan, a change in control may occur in two ways. If an equity award is subject to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), any event that would be considered a change in control under Section 409A of the Code will also trigger accelerated vesting for the award. If the equity award is not subject to Section 409A of the Code, a change of control shall mean the occurrence of any of the following events:

| • | we are not the surviving entity in any merger, consolidation or
other reorganization; |
| --- | --- |
| • | we sell, lease or exchange all or substantially all of our
assets to a third party; |
| • | we dissolve or liquidate our company; |
| • | any person or entity acquires ownership of our securities which
represent 35% or more of the voting power of our then
outstanding securities entitled to vote in the election of
directors; or |
| • | a change in the composition of our Board, where less than the
majority of the directors are “incumbent directors.”
An “incumbent director” is any director as of the date
the Stock Awards Plan was adopted, or who is elected to the
Board after such time by the vote of at least a majority of the
directors in place at the time of the Stock Awards Plan’s
adoption. |

The following chart shows the amounts that each of our Named Executive Officers would have received due to the accelerated vesting on January 31, 2009 for a termination of employment due to death or disability, or a change in control. In order for our Named Executive Officers to receive value from the acceleration of vesting for stock options, however, the value of the stock on January 31, 2009 (the date of the accelerated vesting and hypothetical exercise of such options), must be a greater amount than the exercise price of the option. As of January 31, 2009, none of the Named Executive Officers held stock unvested options with an exercise price below $3.62, and thus there are no values included in the table below for accelerated stock options.

Value of Accelerated Equity Awards as of January 31, 2009

Name		Value (1)
Billy F. Mitcham, Jr.
Restricted Stock	9,500	$ 34,390
Phantom Shares	3,661	$ 13,253
Total		$ 47,643
Robert P. Capps
Restricted Stock	1,334	$ 4,829
Phantom Shares	1,930	6,987
Total		$ 11,816
Paul Guy Rogers
Restricted Stock	4,001	$ 14,484
Phantom Shares	1,930	6,987
Total		$ 21,471
Guy Malden
Restricted Stock	4,001	$ 14,484
Phantom Shares	1,930	6,987
Total		$ 21,471

callerid=999 iwidth=456 length=60

(1) The values for both the restricted stock and the phantom shares were calculated by multiplying (a) the number of unvested restricted stock or phantom shares, respectively, each officer held on January 31, 2009 by (b) $3.62, the fair market value of the stock on that day.

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Employment Agreement with Billy F. Mitcham, Jr.

We have entered into an employment agreement with Mr. Mitcham, the general terms of which are described above. Mr. Mitcham’s severance provisions are dependent upon the following terms:

| • | A for “cause” termination will occur if
Mr. Mitcham: (1) materially breaches his employment
agreement, (2) appropriates a material business opportunity
for his own personal benefit, (3) engages in fraudulent or
dishonest activities with respect to us or our business affairs
or (4) is convicted of or is indicted for a criminal
offense. |
| --- | --- |
| • | Constructive termination is defined as: (1) a material
reduction in Mr. Mitcham’s duties and responsibilities
without his prior consent or (2) a reduction in, or our
failure to pay, any portion of Mr. Mitcham’s base
salary. |
| • | Mr. Mitcham will have suffered a “disability” if,
for physical or mental reasons, he is unable to perform his
duties under the employment agreement for a period of 120
consecutive days, or 180 days during any 12 month
period. |

Pursuant to this employment agreement, in the event his employment is terminated by us “without cause” or he terminates his employment with us within 60 days following a “constructive termination,” Mr. Mitcham will be entitled to a severance payment in an amount equal to $450,000, payable in equal monthly payments over a period of 24 months following the date of termination.

If Mr. Mitcham’s employment with us is terminated as a result of his disability, we will continue to pay to him his base salary (determined as of the date of his disability) for the lesser of (1) six consecutive months or (2) the period until disability insurance benefits commence under any disability insurance coverage furnished by us to Mr. Mitcham. Under our long-term disability insurance program, coverage commences on the 61st day after the covered employee is unable to perform his or her job functions, thus Mr. Mitcham would receive $66,600, which is two months of salary calculated according to the base salary Mr. Mitcham was receiving as of January 31, 2009.

Mr. Mitcham’s employment agreement provides for automatic expiration of any stock options Mr. Mitcham may hold at the time of either a for cause termination or a resignation. Upon a termination for any reason other than a termination for cause, resignation or death, his options will remain exercisable and will vest and expire in accordance with the terms of the applicable option agreements. If Mr. Mitcham’s employment with us is terminated as a result of his death, all of his outstanding options will become fully vested and exercisable as of the date of his death. All options will expire on the one-year anniversary of his death. The value of the accelerated vesting upon these events in accordance with the option agreements is disclosed in the “Value of Accelerated Equity Awards as of January 31, 2009” table above.

Mr. Mitcham’s employment agreement contains standard non-solicitation and non-compete provisions that are effective during the term of the employment agreement and for 24 months following his date of termination.

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DIRECTOR COMPENSATION

General

Each year, the Compensation Committee reviews the total compensation paid to our non-employee directors and Non-Executive Chairman of our Board. The purpose of the review is to ensure that the level of compensation is appropriate to attract and retain a diverse group of directors with the breadth of experience necessary to perform our Board’s duties, and to fairly compensate directors for their service. The review includes the consideration of qualitative and comparative factors. To ensure directors are compensated relative to the scope of their responsibilities, the Compensation Committee considers: (1) the time and effort involved in preparing for Board, committee and management meetings and the additional duties assumed by committee chairs; (2) the level of continuing education required to remain informed of broad corporate governance trends, and material developments and strategic initiatives within our company; and (3) the risks associated with fulfilling fiduciary duties.

The following table sets forth a summary of the compensation we paid to our non-employee directors during the fiscal year ended January 31, 2009. Directors who are our full-time employees, Messrs. Mitcham and Capps, receive no compensation for serving as directors.

Director Compensation for the Year Ended January 31, 2009

| Name | Fees Earned or — Paid in Cash | Stock
Awards (1) | Option
Awards (2) | Total |
| --- | --- | --- | --- | --- |
| | ($) | ($) | ($) | ($) |
| Peter H. Blum | 79,000 | 9,228 | 500,723 | 588,951 |
| John F. Schwalbe | 35,000 | — | 250,362 | 285,362 |
| R. Dean Lewis | 32,000 | — | 250,362 | 282,362 |
| Robert J. Albers | 32,000 | 50,352 | 200,878 | 283,230 |

callerid=999 iwidth=456 length=60

| (1) | This column includes the dollar
amount of compensation expense we recognized for the fiscal year
ended January 31, 2009 in accordance with FAS 123R.
Pursuant to the Securities and Exchange Commission’s rules
and regulations, the amounts shown exclude the impact of
estimated forfeitures related to service-based vesting
conditions. These amounts reflect our accounting expense for
these awards, and do not correspond to the actual value that
will be recognized by our non-employee directors. Assumptions
used in the calculation of these amounts are included in
Note 13 to our audited financial statements for the fiscal
year ended January 31, 2009 included in our Annual Report
on Form 10-K. The awards for which compensation expense was recognized consist
of an award granted on March 31, 2006 for Mr. Blum and
an award granted on January 30, 2008 to Mr. Albers.
Mr. Blum had 1,333 shares of restricted stock
outstanding as of January 31, 2009. |
| --- | --- |
| (2) | This column includes the dollar
amount of compensation expense we recognized for the fiscal year
ended January 31, 2009 in accordance with FAS 123R.
Pursuant to the Securities and Exchange Commission’s rules
and regulations, the amounts shown exclude the impact of
estimated forfeitures related to service-based vesting
conditions. These amounts reflect our accounting expense for
these awards, and do not correspond to the actual value that
will be recognized by our non-employee directors. Assumptions
used in the calculation of these amounts are included in
Note 13 to our audited financial statements for the fiscal
year ended January 31, 2009 included in our Annual Report
on Form 10-K. The awards for which compensation expense was recognized consist
of awards granted on July 27, 2006 and July 12, 2007
to Messrs. Blum, Schwalbe and Lewis, on January 30,
2008 to Mr. Albers and on July 24, 2008 to Messrs
Blum, Schwalbe, Lewis and Albers. See “Equity-Based
Compensation” below for a brief description of these
awards. The aggregate number of stock option awards outstanding
at January 31, 2009 for each of the directors is as
follows: Mr. Blum — 410,000 shares;
Mr. Schwalbe — 115,000 shares;
Mr. Lewis — 115,000 shares; and
Mr. Albers — 60,000 shares. |

Retainer/Fees

Each non-employee director receives the following compensation:

• an annual cash retainer fee of $25,000 per year, plus an additional $50,000 for the Non-Executive Chairman of our Board;

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| • | additional cash retainer of $5,000 per year for each member of
the Audit Committee, plus an additional $3,000 per year for the
chairperson of the Audit Committee; and |
| --- | --- |
| • | additional cash retainer of $2,000 per year for each member of
the Compensation Committee, plus an additional $2,000 per year
for the chairperson of the Compensation Committee. |

Equity-Based Compensation

In addition to cash compensation, our non-employee directors are eligible, at the discretion of our full Board, to receive discretionary grants of stock options or restricted stock or any combination thereof under our equity compensation plans. On July 24, 2008, the Board of Directors awarded options to purchase 30,000 shares of common stock to each non-employee director (except for the Non-Executive Chairman) and options to purchase 60,000 shares to our Non-Executive Chairman pursuant our Stock Awards Plan. The grant was made after a review of the prior compensation of our non-employee directors. The option awards vest over a three-year period beginning on the first anniversary of the grant date.

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PROPOSAL 2: AMENDMENT TO THE MITCHAM INDUSTRIES, INC. STOCK AWARDS PLAN

Introduction

Our Board, subject to the approval of our shareholders as required under the NASDAQ rules and the terms of the Mitcham Industries, Inc. Stock Awards Plan (the “Plan”), has approved a first amendment to the Plan, which would authorize us to reserve up to an additional 350,000 shares of common stock beyond the 899,864 shares initially authorized for issuance under the Plan. If our shareholders approve this proposal, we intend to file, pursuant to the Securities Act of 1933, as amended, a registration statement on Form S-8 to register the additional shares available for issuance under the Plan.

The proposed first amendment to the Plan is included in this proxy statement as Appendix A , and the Plan, prior to giving effect to this proposed amendment, is in this proxy statement as Appendix B . Below is a summary of the material terms of the Plan, though this summary is qualified in its entirety by reference to the full text of the Plan. Unless otherwise defined below, capitalized terms used in this section have the same meaning ascribed to such terms in the Plan.

Our Board recommends a vote “FOR” the amendment to the Plan.

Reason for Proposed Amendment

The use of stock-based awards under the Plan has been a key component of our compensation program since its adoption in 2006. The awards granted under the Plan assist us in attracting and retaining capable, talented individuals to serve in the capacity of employees, consultants and non-employee directors. The Plan initially authorized us to issue up to 899,864 shares of our common stock pursuant to the Plan. As of May 27, 2009, 208,000 shares were available for us to issue as awards under the Plan. Accordingly, the Compensation Committee of our Board has determined that there are not sufficient shares available for issuance under the Plan to meet our needs for future grants during the coming years, and an increase in available shares is necessary to continue granting incentive and reward opportunities to eligible participants while assisting us in retaining a competitive edge in today’s volatile business environment.

Purpose and Key Features of the Plan

The Plan is a broad-based incentive plan that provides for granting stock options, stock appreciation rights (“SARs”), restricted stock awards, performance awards, phantom stock, stock payments, and other stock-based awards to employees, consultants and non-employee directors. The Plan is designed to enable us and our subsidiaries to provide those individuals upon whom the responsibilities of the successful administration and management of our company and our subsidiaries rest with stock-based incentive and reward opportunities designed to align their interests with those of our shareholders, thereby enhancing our profitable growth. A further purpose of the Plan is to provide a means for us to attract and retain such individuals in our service and our subsidiaries.

Number of Shares Subject to the Plan

The maximum number of shares of our common stock that may be issued under the Plan with respect to awards is currently 899,864 shares. Upon certain corporate events, such as a stock split, recapitalization, reorganization, spinoff and other similar events, the number of shares available under the Plan will be adjusted to appropriately reflect that event. In the discretion of the Compensation Committee, all 899,864 shares (subject to adjustment as described above) may be issued under the Plan pursuant to incentive stock options.

Pursuant to the Plan, no participant may receive stock-denominated awards with respect to more than 125,000 shares in any fiscal year, again subject to adjustment for certain events described above, and the

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maximum amount of cash-denominated awards that may be granted to any participant during any fiscal year may not exceed $2,000,000 based on the market value at the time of the grant.

The shares of common stock to be delivered under the Plan may be treasury shares or authorized but unissued shares. To the extent that an award terminates, expires, lapses, is settled in cash, the shares subject to the award may be used again with respect to new grants under the Plan. Also, shares tendered or withheld to satisfy the grant or exercise price or our tax withholding obligations may be used again for grants under the Plan.

Administration

In general, the Plan is administered by the Compensation Committee, which is intended to be comprised solely of two or more non-employee directors (within the meaning of Rule 16b-3 of the Exchange Act) who also qualify as “outside directors” (within the meaning assigned to such term under Section 162(m) of the Code). The term “Committee,” as used in the Plan and below, refers to the Compensation Committee and includes any other committee of the Board, if appointed.

The Committee has the full authority, subject to the terms of the Plan, to establish rules and regulations for the proper administration of the Plan, to select the employees and consultants to whom awards are granted, and to determine the type of awards made and the terms of the awards. However, the Board alone has the authority to administer the Plan with respect to awards to directors.

Eligibility

All of our employees and consultants, all employees and consultants of our subsidiaries, and our directors are eligible to participate in the Plan. The selection of which of the eligible employees and consultants receive awards under the Plan is within the sole discretion of the Committee. As of May 27, 2009 approximately 140 individuals were eligible for awards under the plan.

Term of Plan

The Plan was approved by the Board on May 30, 2006. No awards may be granted under the Plan after the 10th anniversary of the date the Plan was approved by the Board (May 30, 2016). The proposed amendment to the Plan would not affect this termination date. The Board or the Committee may terminate the Plan earlier at any time with respect to any shares of common stock for which awards have not theretofore been granted.

Stock Options and SARs

The term of each option and SAR will be as specified by the Committee at the date of grant (but will not be more than ten years). The effect of the termination of an optionee’s employment, consulting relationship, or membership on the Board will be specified in the award agreement that evidences the stock option or SAR grant. The exercise price for each stock option and SAR will be determined by the Committee and will be no less than the fair market value of the shares on the date that the stock option or SAR is granted. The Committee will also determine the length of service, performance objectives or other conditions, if any, that must be satisfied before all or part of a stock option or SAR may vest and be exercised. The period during which a stock option or SAR may be exercised will be set forth in the award agreement.

The status of a stock option granted to an employee as to whether it is an incentive stock option or a non-qualified stock option will be designated by the Committee at the time of grant. The Committee may determine the method by which the stock option price may be paid upon exercise, including in cash, check, shares of our common stock already owned by the optionee, or by any combination thereof. The Plan also

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allows the Committee, in its discretion, to establish procedures pursuant to which an optionee may affect a cashless exercise of a stock option through a broker.

Restricted Stock

Pursuant to a restricted stock award, shares of our common stock will be issued in the name of the employee, consultant or director at the time the award is made, but such shares will be subject to certain restrictions on the disposition thereof and certain obligations to forfeit and surrender the shares back to us, which may be linked to performance criteria or other specified criteria, including the passage of time, as may be determined in the discretion of the Committee.

Performance Awards

The Committee may grant performance awards, which are dollar-denominated awards that may be paid in cash, our common stock or any combination thereof, as determined by the Committee in its discretion. At the time of the grant, the Committee will establish the dollar amount of each performance award, the specified criteria, including the passage of time or performance criteria, that must be achieved, and the performance period over which the performance or vesting goals will be measured. Following the end of the performance period, the Committee will determine the amount payable to the holder of the performance award based on the achievement of the vesting goals for such performance period. Payment of vested awards will be made in cash and/or in shares of our common stock, as determined by the Committee, following the close of the performance period.

Phantom Stock Awards

Phantom stock awards are awards of rights to receive amounts equal to a specified number of shares of our common stock. Such awards may be subject to the fulfillment of conditions, which may be linked to Performance Criteria (as defined below) or other specified criteria, including the passage of time as the Committee may specify. Payment of phantom stock awards may be made in cash, shares of common stock or any combination thereof, as determined by the Committee in its discretion, and will be paid following the close of the vesting period. Any payment to be made in cash will be based on the fair market value of a share of common stock on the payment date. A phantom stock award may include dividend equivalent rights (“DERs”) in the discretion of the Committee. DERs are rights to receive an amount of cash equal to the value of any dividends made on shares of common stock during the period the phantom stock award is outstanding. Payment of DERs may be made subject to the same vesting terms as the tandem phantom stock award or may have different vesting and payment terms, in the discretion of the Committee.

Stock Payments

Stock Payments are unrestricted shares of common stock issued to the grantee and may be paid as part of, or in lieu of all or any portion of, any bonus, deferred compensation or other compensation of an eligible individual.

Other Stock-Based Awards

An other stock-based award is an award the value of which is based in whole or in part on a share of our common stock. The Committee may set such vesting and/or performance criteria as it chooses with respect to such award. Upon vesting, the award may be paid in shares, cash or any combination thereof, as decided by the Committee.

Performance-Based Compensation

With respect to awards that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the Committee will establish performance goals based upon the attainment of such target levels of one or more of the Performance Criteria (as described below) over one or more periods of time, which may be of varying and overlapping durations, as the Committee may select. A performance

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goal need not be based upon an increase or positive result under a Performance Criteria (as described below) and could, for example, be based upon limiting economic losses or maintaining the status quo. Which Performance Criteria (as described below) to be used with respect to any grant, and the weight to be accorded thereto if more than one criteria is used, will be determined by the Committee at the time of grant. Following the completion of each specified performance period, the Committee will certify in writing whether the applicable performance goals have been achieved for such performance period. In determining the amount earned by a participant, the Committee will have the right to reduce or eliminate (but not to increase) the amount payable at a given level of performance to take into account additional factors that the Committee may deem relevant to the assessment of individual or corporate performance for the performance period.

For purposes of the Plan, the term “Performance Criteria” means the following business criteria with respect to us, any of our subsidiaries or any divisions or operating units: net earnings (either before or after interest, taxes, depreciation and/or amortization), sales, revenue, net income (either before or after taxes), operating earnings, cash flow (including, but not limited to, operating cash flow and free cash flow), cash flow return on capital, return on net assets, return on shareholders’ equity, return on assets, return on capital, shareholder returns, return on sales, gross or net profit margin, expense, margins, cost reductions, controls or savings, operating efficiency, working capital, strategic initiatives, economic value added, earnings per share, earnings per share from operations, price per share of stock, and market share. Such targets may be expressed in terms of our company as a whole, a subsidiary, division or business unit, as determined by the Committee. The performance measures will be subject to adjustment for changes in accounting standards required by the Financial Accounting Standards Board after the goal is established, and, to the extent provided for in the award agreement and permitted by Section 162(m) of the Code, will be subject to adjustment for specified significant extraordinary items or events. In this regard, performance goals based on stock price will be proportionately adjusted for any changes in the price due to a stock split. Performance measures may be absolute, relative to one or more other companies, or relative to one or more indexes, and may be contingent upon our future performance or any of our subsidiaries, divisions, or departments thereof. A performance goal need not be based upon an increase or positive result under a business criterion and may be based upon limiting economic losses or maintaining the status quo.

Miscellaneous

The Committee may amend or modify the Plan at any time; provided, however, that we will obtain shareholder approval for any amendment to the extent necessary and desirable to comply with any applicable law, regulation or stock exchange rule, or to increase the number of shares available. In addition, shareholder approval will generally be required for any amendment that reduces the exercise price of any “underwater” option or SAR. An option or SAR is considered to be “underwater” when the exercise price exceeds the fair market value.

In the event that we experience a change of control (as defined in the Plan), the Committee may take such action with respect to awards as it deems appropriate, including the vesting of awards and cashout of awards.

Federal Income Tax Aspects of the Plan

The following is a brief summary of certain of the U.S. federal income tax consequences under the Plan as normally operated and is not intended to be exhaustive.

As a general rule, no federal income tax is imposed on a participant upon the grant of a an award under the Plan, other than stock payment, and we are not entitled to a tax deduction by reason of such grant, other than stock payment. A stock payment will result in taxable income to the individual at the time of grant and we will be entitled to a corresponding tax deduction for that year. In general, when a restricted stock, phantom stock, performance award or other stock-based award becomes vested and is paid, the holder will realize ordinary income in an amount equal to the cash and/or the fair market value of the shares of our common stock received at that time, and, subject to Section 162(m) of the Code, we will be entitled to a corresponding deduction. Upon the exercise of a non-qualified stock option or SAR, the participant will be treated as

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receiving compensation taxable as ordinary income in the year of exercise in an amount equal to the excess of the fair market value of the shares of stock at the time of exercise over the exercise price paid for such shares, and we may claim a deduction for compensation paid at the same time and in the same amount as compensation is recognized by the holder, assuming applicable federal income tax reporting requirements are satisfied. Stock options that are incentive stock options (“ISOs”) under Section 422 of the Code are subject to special federal income tax treatment. In general, no federal income tax is imposed on the exercise of an ISO, although the exercise may trigger alternative minimum tax liability to the optionee, and we are not entitled to any deduction for federal income tax purposes in connection with the grant or exercise of an ISO. However, if the optionee disposes of the shares acquired upon exercise of an ISO before satisfying certain holding period requirements, the optionee will be treated, in general, as having received, at the time of disposition, compensation taxable as ordinary income and in such event, we may claim a deduction for compensation paid at the same time and in the same amount as the compensation treated as being received by the optionee.

In general, Section 162 (m) of the Code precludes a public corporation from taking a deduction for annual compensation in excess of $1 million paid to a “covered employee” as defined in the regulations to Section 162(m) of the Code (which is generally our chief executive officer and our three other highest-paid officers other than our chief financial officer), unless the compensation qualifies under Section 162(m) of the Code as “performance-based.” The Plan has been designed to provide flexibility with respect to whether awards granted by the Committee will qualify as performance-based compensation under Section 162(m) of the Code and, therefore, be exempt from the deduction limit.

In the event of our change of control, awards granted to certain individuals may be “excess parachute” payments for purposes of Section 280G of the Code and, in such event, the individual would be subject to an additional 20% excise tax with respect to the “parachute value” of the awards and we would not be entitled to a tax deduction for such “excess” parachute amounts.

The Plan and awards granted under it are intended to comply with Section 409A of the Code, which governs the treatment of deferred compensation. Failure to comply could subject a participant to an additional 20% tax.

Inapplicability of ERISA

Based upon current law and published interpretations, we do not believe that the Plan is subject to any of the provisions of the Employee Retirement Income Security Act of 1974, as amended.

Grants to Certain Individuals

The awards, if any, that will be made to eligible participants under the Plan are subject to the discretion of the Committee, and thus we cannot currently determine the benefits or number of shares subject to awards that may be granted in the future to our executive officers, employees or directors under the proposed amendment to the Plan, and therefore a “New Plan Benefits Table” is not provided. Due to the discretionary nature of the Plan, we are also unable to determine the benefits or number of shares subject to awards that would have been granted to our executive officers, employees or directors for the last completed year under the proposed amendment to the Plan assuming such amendment had been in effect during the last completed fiscal year. However, we do not believe the benefits or number of shares subject to award during our prior fiscal year would have changed from what they were had the proposed amendment to the Plan been in effect

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The following table sets forth information, as of January 31, 2009, with respect to all benefits or amounts that were received by or allocated to our named executive officers, each of our directors, all of our current executive officers as a group, all of our current directors as a group and all employees, including all current officers who are not executive officers, as a group under the Plan. No awards have been granted under the Plan to any associate of a non-employee director, nominee or executive officer, and no other person has been granted 5% or more of the total amount of awards granted under the Plan; thus the table below does not include these individuals.

	Number of
	Stock Options
Named Executive Officers	Granted (1)
Billy F. Mitcham, Jr.	460,500
President and Chief Executive Officer
Robert P. Capps	120,000
Executive Vice President, Chief Financial Officer
Paul Guy Rogers	82,500
Vice President Business Development
Guy Malden	36,500
Vice President Marine Systems
Peter H. Blum	410,000
Non-Executive Chairman
R. Dean Lewis	115,000
Director
John F. Schwalbe	85,000
Director
Robert J. Albers	60,000
Director
All Current Executive Officers as a Group	699,500
All Current Directors as a Group (other than Executive
Officers)	670,000
All Employees (Including Officers other than Executive
Officers)	119,500

callerid=999 iwidth=456 length=60

(1) We currently grant stock options, restricted stock and performance awards under the Plan. The Plan does not provide for warrants or other rights that act as appreciation-type awards; thus, the only awards listed above are stock options.

Securities Authorized for Issuance under Equity Compensation Plans

Information regarding our equity compensation plans as of January 31, 2009 is as follows:

EQUITY COMPENSATION PLAN INFORMATION

	Number of		Number of securities — remaining available for
	securities to be		future issuance under
	issued upon	Weighted-average	equity compensation
	exercise of	exercise price of	plans (excluding
	outstanding	outstanding options	securities reflected in
	options and rights	and rights	column (a))
Plan Category	(a)	(b)	(c)
Equity compensation plans approved by security holders	1,489,000	$ 10.26	208,000	(1)
Equity compensation plans not approved by security
holders (2)	—	—	—
Total	1,489,000	$ 10.26	208,000

callerid=999 iwidth=456 length=60

| (1) | As of January 31, 2009, these
share were available for issuance under our Plan pursuant to
which our Compensation Committee, at its discretion, has the
authority to grant stock options, SARs, restricted stock awards,
performance awards, phantom stock, stock payments, and other
stock-based awards to employees, consultants and non-employee
directors. |
| --- | --- |
| (2) | As of January 31, 2009, we did
not have any compensation plans under which our equity
securities were authorized for issuance that were not previously
approved by security holders. |

Recommendation of the Board

Our Board recommends a vote “FOR” the approval of the amendment to increase the shares of common stock authorized for issuance under the Stock Awards Plan.

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PROPOSAL 3: RATIFICATION OF THE SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee has selected Hein & Associates LLP as our independent registered public accounting firm to conduct our audit for the fiscal year ending January 31, 2010.

The engagement of Hein & Associates LLP has been recommended by the Audit Committee and approved by our Board annually. The Audit Committee has reviewed and discussed the audited consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2009, and has recommended, and our Board has approved their inclusion therein. See “Audit Committee Report” included elsewhere in this proxy statement.

Although shareholder ratification of the selection of Hein & Associates LLP is not required, the Audit Committee and our Board consider it desirable for our shareholders to vote upon this selection. The affirmative vote of the holders of a majority of the shares entitled to vote on, and that vote for or against or expressly abstain, on the proposal at the Annual Meeting is required to approve and ratify the selection of Hein & Associates LLP. Even if the selection is ratified, the Audit Committee may, in its discretion, direct the appointment of a different independent registered public accounting firm at any time during the year if it believes that such a change would be in the best interests of our shareholders and us.

One or more representatives of Hein & Associates LLP are expected to be present at the Annual Meeting and will have the opportunity to make a statement if they desire to do so. The representatives of Hein & Associates LLP are expected to be available to respond to appropriate questions.

Our Board recommends a vote “FOR” the ratification of the selection of Hein & Associates LLP as our independent registered public accounting firm for the fiscal year ending January 31, 2010.

FEES AND EXPENSES OF HEIN & ASSOCIATES LLP

The following table sets forth the amount of audit fees, audit-related fees and tax fees billed or expected to be billed by Hein & Associates LLP, our independent registered public accounting firm, for the fiscal years ended January 31, 2009 and January 31, 2008:

	2009	2008
Audit
fees (1)	$ 504,500	$ 504,282
Audit-related
fees (2)	—	—
Tax
fees (3)	—	—
All other
fees (2)	—	—
Total Fees	$ 504,500	$ 504,282

callerid=999 iwidth=456 length=60

| (1) | Includes the audit of our annual
consolidated financial statements, audit of our system of
internal control over financial reporting and review of
Quarterly Reports on Form 10-Q. |
| --- | --- |
| (2) | During the indicated periods, our
independent registered public accounting firm did not provide us
with any services of this nature. |
| (3) | Includes fees and expenses for
services primarily related to tax compliance, tax advice and tax
planning for certain acquisitions. |

The Audit Committee also has approved a policy that requires committee pre-approval of the compensation and terms of service for audit services and any permitted non-audit services based on ranges of fees, and any changes in terms, conditions and fees resulting from changes in audit scope or other matters. Any proposed audit or non-audit services exceeding the pre-approved fee ranges require additional pre-approval by the Audit Committee or its chairman.

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AUDIT COMMITTEE REPORT

The Audit Committee was established to implement and to support oversight function of the Board of Directors with respect to the financial reporting process, accounting policies, internal controls and independent registered public accounting firm of Mitcham Industries, Inc.

The Board of Directors, in its business judgment, has determined that each of Messrs. Schwalbe, Lewis and Albers is an independent director, as that term is defined in Rule 5605 of the NASDAQ Marketplace Rules, and meets the Securities and Exchange Commission’s additional independence requirements for members of audit committees. In addition, the Board of Directors has determined that each member of the Audit Committee is financially literate and that Mr. Schwalbe has the necessary accounting and financial expertise to serve as chairman. Our Board has determined that Mr. Schwalbe is an “audit committee financial expert” following a determination that Mr. Schwalbe met the criteria for such designation under the Securities and Exchange Commission’s rules and regulations.

In fulfilling its responsibilities, the Audit Committee:

| • | reviewed and discussed the audited financial statements
contained in Mitcham Industries, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009 with management
and the independent registered public accounting firm; |
| --- | --- |
| • | discussed with the independent registered public accounting firm
the matters required to be discussed by the statement on
Auditing Standards No. 61, “ Communications with
Audit Committees ”; |
| • | received from the independent registered public accounting firm
the written disclosures and the letter required by applicable
requirements of the Public Company Accounting Oversight Board
regarding the independent accountant’s communications with
the audit committee concerning independence and discussed the
independent registered public accounting firm’s
independence with the firm; and |
| • | considered the compatibility of non-audit services with the
independent registered public accounting firm’s
independence. |

Based on these reviews and discussions, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in Mitcham Industries, Inc.’s Annual Report on Form 10-K for the fiscal year ended January 31, 2009.

The information contained in this Audit Committee Report shall not be deemed to be “soliciting material” to be “filed” with the Securities and Exchange Commission, nor shall such information be incorporated by reference into any future filings with the Securities and Exchange Commission, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

Respectfully submitted by the Audit Committee,

John F. Schwalbe (Chairman) R. Dean Lewis Robert J. Albers

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ANNUAL REPORT

Our Annual Report for the fiscal year ended January 31, 2009 accompanies this proxy statement. Except for the financial statements included in the Annual Report that are specifically incorporated by reference herein, the Annual Report is not incorporated in this proxy statement and is not to be deemed part of this proxy soliciting material. Additional copies of the Annual Report are available upon request.

OTHER MATTERS

As of the date hereof, our Board knows of no other business to be presented at the Annual Meeting. If any other matter properly comes before the meeting, however, it is intended that the persons named in the accompanying proxy will vote the proxy in accordance with the discretion and instructions of our Board.

SHAREHOLDER PROPOSALS AND DIRECTOR NOMINATIONS

Pursuant to the Securities and Exchange Commission’s rules and regulations, shareholders interested in submitting proposals for inclusion in our proxy materials and for presentation at our 2010 Annual Meeting of Shareholders may do so by following the procedures set forth in Rule 14a-8 under the Exchange Act. In general, shareholder proposals must be received by our Corporate Secretary at Mitcham Industries, Inc., P.O. Box 1175, Huntsville, Texas 77342-1175 no later than February 1, 2010 to be eligible for inclusion in our proxy materials.

In addition, shareholders may present business at a shareholder meeting without having submitted the proposal pursuant to Rule 14a-8 as discussed above. For business to be properly brought or nominations of persons for election to our Board to be properly made at the time of our 2010 Annual Meeting of Shareholders, notice must be received by our Corporate Secretary at the address in the preceding paragraph by April 17, 2010 .

Detailed information for submitting shareholder proposals and director nominations is available upon written request to our Corporate Secretary at Mitcham Industries, Inc., P.O. Box 1175, Huntsville, Texas 77342-1175.

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APPENDIX A

FIRST AMENDMENT TO THE

MITCHAM INDUSTRIES, INC. STOCK AWARDS PLAN

WHEREAS , the Board of Directors of Mitcham Industries (the “Company”) originally established the Mitcham Industries, Inc. Stock Awards Plan (the “Plan”) to be effective May 30, 2006 for purposes of providing incentive compensation awards to certain employees, officers, consultants and advisors based on the Company’s common stock (the “Stock”);

WHEREAS , the Board of Directors of the Company (the “Board”) has determined that there are no longer sufficient shares of Stock available for issuance under the Plan to meet the Company’s needs for future grants during the coming years; and

WHEREAS , the Board has determined that it is the best interest of the Company and its shareholders to increase the number of shares available for issuance under the Plan by 350,000 shares so that the Company may continue to grant incentive and reward opportunities to eligible participants under the Plan;

NOW THEREFORE , for and in consideration of the foregoing and the agreements contained herein, the Plan shall be amended as follows:

| 1. | Defined Terms. Unless otherwise defined herein,
capitalized terms used herein shall have the same meaning
ascribed thereto in the Plan. |
| --- | --- |
| 2. | Amendment. The number of shares that may be issued
pursuant to the Plan in Section 4.1 of the Plan shall, as of the
effective date of this Amendment, be changed from 899,864 to
1,249,864. |
| 3. | Remainder of Plan. Except as expressly provided herein,
the Plan remains in full force and effect. In the event that the
Company’s shareholders approve this Amendment at the 2009
Annual Meeting of Shareholders of the Company, the term
“Plan” shall hereafter refer to the Plan as amended by
this Amendment. |
| 4. | Effective Date. The amendments to the Plan set forth
herein shall be effective as of July 23, 2009, provided
that this Amendment is approved by the shareholders of the
Company at the 2009 Annual Meeting of Shareholders to held on
such date. If this Amendment is not so approved at such meeting,
then the amendments to the Plan set forth herein shall be void ab initio . |

IN WITNESS WHEREOF , the Company has caused the Amendment to be duly executed in its name and on its behalf by its duly authorized representative effective as of the date set forth above.

MITCHAM INDUSTRIES, INC.
By: ­
­
Name: ­
­
Title: ­
­

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APPENDIX B

MITCHAM INDUSTRIES, INC.

STOCK AWARDS PLAN

SECTION 1. Purpose of the Plan.

The Mitcham Industries, Inc. Stock Awards Plan (the “Plan”) is intended to promote the interests of Mitcham Industries, Inc., a Texas corporation (the “Company”), by encouraging Employees, Consultants and Directors to acquire or increase their equity interest in the Company and to provide a means whereby they may develop a sense of proprietorship and personal involvement in the development and financial success of the Company, and to encourage them to remain with and devote their best efforts to the business of the Company, thereby advancing the interests of the Company and its stockholders. The Plan is also contemplated to enhance the ability of the Company and its Subsidiaries to attract and retain the services of individuals who are essential for the growth and profitability of the Company. The Plan is an amendment and restatement of the Prior Plan. In addition, the Mitcham Industries, Inc. 2000 Stock Option Plan (the “2000 Plan”) is hereby merged into the Plan. All awards outstanding under the Prior Plan and the 2000 Stock Plan shall continue without interruption or change under this Plan.

SECTION 2. Definitions.

As used in the Plan, the following terms shall have the meanings set forth below:

“Award” shall mean an Option, Restricted Stock, Performance Award, Phantom Share, Stock Payment, SAR, or Other Stock-Based Award.

“Award Agreement” shall mean any written or electronic agreement, contract, instrument or document evidencing any Award, which may, but need not, be executed or acknowledged by a Participant.

“Board” shall mean the Board of Directors of the Company, as constituted from time to time.

“Change of Control” shall mean, with respect to an Award that is subject to Section 409A of the Code, a “change of control event,” as defined in Section 409A of the Code and the regulations thereunder. With respect to an Award that is not subject to Section 409A, Change of Control shall mean the occurrence of any of the following events:

(i) the Company is not the surviving entity in any merger, consolidation or other reorganization with (or survives only as a subsidiary of) an entity other than a previously wholly-owned subsidiary of the Company,

(ii) the Company sells, leases or exchanges all or substantially all of its assets to any other person or entity (other than a wholly-owned subsidiary of the Company),

(iii) the Company is dissolved and liquidated,

(iv) any person or entity, including a “group” as contemplated by Section 13(d)(3) of the 1934 Act, acquires the beneficial ownership, directly or indirectly, of securities of the Company representing 35% or more of the combined voting power of the then outstanding securities entitled to vote generally in the election of directors, or

(v) a change in the composition of the Board, as a result of which fewer than a majority of the directors are Incumbent Directors. “Incumbent Directors” shall mean directors who either (A) are directors of the Company as of the date the Plan was adopted, or (B) are elected, or nominated for election, thereafter to the Board with the affirmative votes of at least a majority of the Incumbent Directors at the time of such election or nomination, but “Incumbent Director” shall not include an individual whose election or nomination is in connection with (i) an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Securities Exchange Act of 1934) or an actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board or (ii) a plan or agreement to replace a majority of the then Incumbent Directors.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations thereunder.

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“Committee” shall mean the administrator of the Plan in accordance with Section 3, and shall include reference to the Compensation Committee of the Board (or any other committee of the Board designated, from time to time, by the Board to act as the Committee under the Plan), the Board or subcommittee, as applicable.

“Consultant” shall mean any individual who is not an Employee or a member of the Board and who provides consulting, advisory or other similar services to the Company or a Subsidiary.

“Director” shall mean any member of the Board who is not an Employee.

“Employee” shall mean any employee of the Company, a Subsidiary or a parent corporation of the Company.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

“Fair Market Value” shall mean, as of any applicable date, the closing sales price (or the closing bid if no sales were reported) for a Share on the national securities exchange or market system which constitutes the principal trading market for the Shares for the applicable date as reported in The Wall Street Journal or such reporting service approved by the Committee; provided, however, that if Shares shall not have been quoted or traded on such applicable date, Fair Market Value shall be determined based on the next preceding date on which they were quoted or traded, or, if deemed appropriate by the Committee, in such other manner as it may determine to be appropriate. In the event the Shares are not publicly traded at the time a determination of Fair Market Value is required to be made hereunder, the determination of Fair Market Value shall be made in good faith by the Committee.

“Incentive Stock Option” or “ISO” shall mean an option granted under Section 6(a) of the Plan that is intended to qualify as an “incentive stock option” under Section 422 of the Code or any successor provision thereto.

“Non-Qualified Stock Option” or “NQO” shall mean an option granted under Section 6(a) of the Plan that is not intended to be an Incentive Stock Option.

“Option” shall mean an Incentive Stock Option or a Non-Qualified Stock Option.

“Other Stock-Based Award” shall mean an Award granted under Section 6(g) of the Plan.

“Participant” shall mean any Employee, Consultant or Director granted an Award under the Plan.

“Performance Award” shall mean any right granted under Section 6(c) of the Plan.

“Performance Criteria” shall mean the following business criteria with respect to the Company, any Subsidiary or any division, operating unit or product line: net earnings (either before or after interest, taxes, depreciation and/or amortization), sales, revenue, net income (either before or after taxes), operating earnings, cash flow (including, but not limited to, operating cash flow and free cash flow), cash flow return on capital, return on net assets, return on stockholders’ equity, return on assets, return on capital, stockholder returns, return on sales, gross or net profit margin, expense margins, cost reductions, controls or savings, operating efficiency, working capital, strategic initiatives, economic value added, earnings per share, earnings per share from operations, price per share of stock, and market share.

“Person” shall mean individual, corporation, partnership, limited liability company, association, joint-stock company, trust, unincorporated organization, government or political subdivision thereof or other entity.

“Phantom Shares” shall mean an Award of the right to receive Shares, cash equal to the Fair Market Value of such Shares or any combination thereof, in the Committee’s discretion, which is granted pursuant to Section 6(d) of the Plan.

“Prior Plan” shall mean the Amended and Restated 1998 Stock Awards Plan of Mitcham Industries, Inc.

“Restricted Period” shall mean the period established by the Committee with respect to an Award during which the Award either remains subject to forfeiture or is not exercisable by the Participant, as the case may be.

“Restricted Stock” shall mean any Share, prior to the lapse of restrictions thereon, granted under Section 6(b) of the Plan.

“Rule 16b-3” shall mean Rule 16b-3 promulgated by the SEC under the Exchange Act, or any successor rule or regulation thereto as in effect from time to time.

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“SAR” shall mean a stock appreciation right granted under Section 6(e) of the Plan that entitles the holder to receive the excess of the Fair Market Value of a Share on the relevant date over the exercise price of such SAR, with the excess paid in cash and/or in Shares in the discretion of the Committee.

“SEC” shall mean the Securities and Exchange Commission or any successor thereto.

“Shares” or “Common Shares” or “Common Stock” shall mean the common stock of the Company, $0.01 par value, and such other securities or property as may become the subject of Awards under the Plan.

“Stock Payment” means a payment in the form of Shares as part of or in lieu of any cash bonus, deferred compensation or other compensation arrangement, granted pursuant to Section 6(f) of the Plan.

“Subsidiary” shall mean any entity (whether a corporation, partnership, joint venture, limited liability company or other entity) in which the Company owns a majority of the voting power of the entity directly or indirectly, except with respect to the grant of an ISO the term Subsidiary shall mean any “subsidiary corporation” of the Company as defined in Section 424 of the Code.

SECTION 3. Administration.

3.1 The Committee. The Plan shall be administered by the Compensation Committee of the Board (or any other committee of the Board designated, from time to time, by the Board to act as the Committee under the Plan). Notwithstanding the foregoing, Awards made to Directors shall be administered by the Board. The term “Committee” as used herein shall refer to the Compensation Committee (or other Board committee), the Board, or the subcommittee (as defined in paragraph (c) of this Section 3), as applicable.

3.2 Committee Powers. A majority of the Committee shall constitute a quorum, and the acts of the members of the Committee who are present at any meeting thereof at which a quorum is present, or acts unanimously approved by the members of the Committee in writing, shall be the acts of the Committee. Subject to the terms of the Plan and applicable law, and in addition to other express powers and authorizations conferred on the Committee by the Plan, the Committee shall have full power and authority to: (i) designate Participants; (ii) determine the type or types of Awards to be granted to a Participant; (iii) determine the number of Shares to be covered by, or with respect to which payments, rights, or other matters are to be calculated in connection with, Awards; (iv) determine the terms and conditions of any Award; (v) determine whether, to what extent, and under what circumstances Awards may be settled or exercised in cash, Shares, other securities, other Awards or other property, or canceled, forfeited, or suspended and the method or methods by which Awards may be settled, exercised, canceled, forfeited, or suspended; (vi) interpret and administer the Plan and any instrument or agreement relating to an Award made under the Plan; (vii) establish, amend, suspend, or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; and (viii) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan. Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations, and other decisions under or with respect to the Plan or any Award shall be within the sole discretion of the Committee, may be made at any time and shall be final, conclusive, and binding upon all Persons, including the Company, any Subsidiary, any Participant, any holder or beneficiary of any Award, any stockholder and any other Person.

3.3 Delegation to a Subcommittee. The Committee may, subject to any applicable law, regulatory, securities exchange or other similar restrictions, delegate to one or more members of the Board or officers of the Company (the “subcommittee”), the authority to administer the Plan as to Awards to Employees and Consultants who are not subject to Section 16(b) of the Exchange Act. The Committee may impose such limitations and restrictions, in addition to any required restrictions/limitations, as the Committee may determine in its sole discretion. Any grant made pursuant to such a delegation shall be subject to all of the provisions of the Plan concerning this type of Award.

SECTION 4. Shares Available for Awards.

4.1 Shares Available. Subject to adjustment as provided below, the number of Shares that may be issued with respect to Awards granted under the Plan shall be 899,864, which shall include any Shares remaining available for Awards under the Prior Plan and the 2000 Plan on the date this amendment and restatement of the Plan becomes effective. If an Award granted after the Plan’s effective date is forfeited or otherwise lapses,

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expires, terminates or is canceled without the actual delivery of Shares (Restricted Stock awards shall not be considered “delivered Shares” for this purpose) or is settled in cash, then the Shares covered by such Award, to the extent of such forfeiture, expiration, lapse, termination or cancellation, shall again be Shares that may be issued with respect to Awards granted under the Plan. Shares tendered to or withheld by the Company to satisfy any tax withholding or exercise price obligations with respect to an Award granted after the Plan’s effective date shall be available for issuance under future Awards, subject to the overall limitation provided in the first sentence above. In the discretion of the Committee, all 899,864 Shares (as adjusted, if applicable) may be issued under the Plan pursuant to ISOs.

4.2 Sources of Shares Deliverable Under Awards. Any Shares delivered pursuant to an Award may consist, in whole or in part, of authorized and unissued Shares or of treasury Shares.

4.3 Adjustments. In the event of a stock dividend or stock split with respect to Shares, the number of Shares with respect to which Awards may be granted, the number of Shares subject to outstanding Awards, the grant or exercise price with respect to outstanding Awards and the individual annual grant limits with respect to Awards (other than dollar denominated Awards) automatically shall be proportionately adjusted, without action by the Committee; provided, however, such automatic adjustment shall be evidenced by written addendums to the Plan and Award Agreements prepared by the Company and, with respect to Options, shall be in accordance with the Treasury Regulations concerning Incentive Stock Options. Further, in the event that the Committee determines that any distribution (whether in the form of cash, Shares, other securities, or other property), recapitalization, reorganization, merger, spin-off, combination, repurchase, or exchange of Shares or other securities of the Company, or other similar corporate transaction or event affects the Shares such that an adjustment is determined by the Committee to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and type of Shares (or other securities or property) with respect to which Awards may be granted, (ii) the number and type of Shares (or other securities or property) subject to outstanding Awards, and (iii) the grant or exercise price with respect to any Award or, if deemed appropriate, make provision for a cash payment to the holder of an outstanding Award; provided that the number of Shares subject to any Award denominated in Shares shall always be a whole number.

4.4 Individual Participant Limits. Subject to adjustment pursuant to the above paragraph (c), the maximum aggregate number of Shares that may be subject to Share-denominated Awards granted under the Plan to any individual during any fiscal year of the Company shall not exceed 125,000. The method of counting such Shares shall conform to any requirements applicable to performance-based compensation under Section 162(m) of the Code or the rules and regulations promulgated thereunder. The maximum amount of dollar-denominated Awards that may be granted to any individual during any fiscal year of the Company shall not exceed $2,000,000 as valued on the date of the grant.

SECTION 5. Eligibility.

Any Employee, Consultant or Director shall be eligible to be designated a Participant by the Committee. No individual shall have any right to be granted an Award pursuant to this Plan.

SECTION 6. Awards.

6.1 Options. Subject to the provisions of the Plan, the Committee shall have the authority to determine Participants to whom Options shall be granted, the number of Shares to be covered by each Option, the purchase price therefor and the conditions and limitations applicable to the exercise of the Option, including the following terms and conditions and such additional terms and conditions, as the Committee shall determine, that are not inconsistent with the provisions of the Plan.

6.1.1 Exercise Price . The purchase price per Share purchasable under an Option shall be determined by the Committee at the time the Option is granted, but shall not be less than the Fair Market Value per Share on the effective date of such grant.

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whole or in part, and the method or methods by which, and the form or forms (which may include, without limitation, cash, check acceptable to the Company, Shares already-owned for more than six months (unless such holding requirement is waived by the Committee), Shares issuable upon Option exercise, a “cashless-broker” exercise (through procedures approved by the Committee), other securities or other property, a note, or any combination thereof, having a Fair Market Value on the exercise date equal to the relevant exercise price) in which payment of the exercise price and tax withholding obligation with respect thereto may be made or deemed to have been made. The Committee shall also determine the performance or other conditions, if any, that must be satisfied before all or part of an Option may vest and be exercised. No portion of an Option which is unexercisable at termination of the Participant’s employment or service, as applicable, shall thereafter become exercisable, except as may be otherwise provided by the Committee either in the Award Agreement or by action following the grant of the Option.

6.1.3 Incentive Stock Options . An Incentive Stock Option may be granted only to an individual who is an Employee of the Company or any parent or subsidiary corporation (as defined in Section 424 of the Code) at the time the Option is granted and must be granted within 10 years from the date the Plan was approved by the Board or the shareholders, whichever is earlier. To the extent that the aggregate Fair Market Value (determined at the time the respective Incentive Stock Option is granted) of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by an individual during any calendar year under all incentive stock option plans of the Company and its parent and subsidiary corporations exceeds $100,000, such Incentive Stock Options shall be treated as a Non-Qualified Stock Option. The Committee shall determine, in accordance with applicable provisions of the Code, Treasury Regulations and other administrative pronouncements, which of a Participant’s Incentive Stock Options will not constitute Incentive Stock Options because of such limitation and shall notify the Participant of such determination as soon as practicable after such determination. No Incentive Stock Option shall be granted to an individual if, at the time the Option is granted, such individual owns stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or of its parent or subsidiary corporation, within the meaning of section 422(b)(6) of the Code, unless (i) at the time such Option is granted the option price is at least 110% of the Fair Market Value of the Common Stock subject to the Option and (ii) such Option by its terms is not exercisable after the expiration of five years from the date of grant. An Incentive Stock Option shall not be transferable otherwise than by will or the laws of descent and distribution, and shall be exercisable during the Participant’s lifetime only by such Participant or the Participant’s guardian or legal representative. The terms of any Incentive Stock Option granted under the Plan shall comply in all respects with the provisions of Section 422 of the Code, or any successor provision, and any regulations promulgated thereunder.

6.2 Restricted Stock. Subject to the provisions of the Plan, the Committee shall have the authority to determine the Participants to whom Restricted Stock shall be granted, the number of Shares of Restricted Stock to be granted to each such Participant, the duration of the Restricted Period during which, and the conditions, including the Performance Criteria or other specified criteria, including the passage of time, if any, under which the Restricted Stock may vest or be forfeited to the Company, and the other terms and conditions of such Awards.

6.2.1 Dividends . Dividends paid on Restricted Stock may be paid directly to the Participant, may be subject to risk of forfeiture and/or transfer restrictions during any period established by the Committee or sequestered and held in a bookkeeping cash account (with or without interest) or reinvested on an immediate or deferred basis in additional shares of Common Stock, which credit or shares may be subject to the same restrictions as the underlying Award or such other restrictions, all as determined by the Committee in its discretion, as provided in the Award Agreement. If the Award Agreement does not provided for the treatment of dividends, such dividends shall be held by the Company without interest until such time as the Share becomes vested or forfeited, as the case may be, and then be similarly paid to the Participant or forfeited.

6.2.2 Registration . Any Restricted Stock may be evidenced in such manner as the Committee shall deem appropriate, including, without limitation, book-entry registration or issuance of a stock certificate or certificates. In the event any stock certificate is issued in respect of Restricted Stock granted under the Plan, such certificate shall be registered in the name of the Participant and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Stock.

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6.2.3 Forfeiture and Restrictions Lapse . Except as otherwise determined by the Committee or the terms of the Award Agreement, upon a Participant’s termination of employment or service (as determined under criteria established by the Committee) for any reason during the applicable Restricted Period, all Restricted Stock shall be forfeited by the Participant and re-acquired by the Company. The Committee may, in its discretion, waive in whole or in part any or all remaining restrictions with respect to such Participant’s Restricted Stock; provided, however, if the Award is intended to qualify as performance based compensation under Section 162(m) of the Code, such waiver may be only in compliance with the requirements of Section 162(m) of the Code. Unrestricted Shares, evidenced in such manner as the Committee shall deem appropriate, shall be issued to the holder of Restricted Stock promptly after the applicable restrictions have lapsed or otherwise been satisfied.

6.2.4 Restrictions . Restricted Stock shall be subject to such restrictions on transferability and other restrictions as the Committee may impose (including, without limitation, restrictions on the right to vote Restricted Stock or the right to receive dividends on the Restricted Stock). These restrictions may lapse separately or in combination at such times, pursuant to such circumstances, in such installments, or otherwise, as the Committee determines at the time of the grant of the Award or thereafter. During the Restricted Period, Restricted Stock will be subject to such limitations on transfer as necessary to comply with Section 83 of the Code.

6.3 Performance Awards. The Committee shall have the authority to determine the Participants who shall receive Performance Awards, which shall be denominated as a cash amount at the time of grant and confer on the Participant the right to receive all or part of such Award upon the achievement of such performance goals (based on the Performance Criteria or any other specified criteria) during such performance periods as the Committee shall establish with respect to the Award. The Committee, in its discretion, may determine whether an Award is to qualify as performance-based compensation as described in Section 162(m) (4) (C) of the Code.

6.3.1 Terms and Conditions . Subject to the terms of the Plan and any applicable Award Agreement, the Committee shall determine the performance goals to be achieved during any performance period, the Performance Criteria or other criteria upon which the performance goals are to be based, the length of any performance period and the amount of any Performance Award.

6.3.2 Payment of Performance Awards . To the extent then earned, Performance Awards shall be paid (in cash and/or in Shares, in the sole discretion of the Committee) in a lump sum following the close of the performance period.

6.3.3 Forfeiture and Restrictions Lapse . Except as otherwise determined by the Committee or the terms of the Award Agreement that granted the Performance Award, upon a Participant’s termination of employment or service, as applicable (as determined under criteria established by the Committee) for any reason during the applicable Restricted Period, all Performance Awards shall be forfeited by the Participant and re-acquired by the Company. The Committee may, in its discretion, waive in whole or in part any or all remaining restrictions with respect to such Participant’s Performance Award; provided, however, if the Award is intended to qualify as performance based compensation under Section 162(m) of the Code, such waiver may be only in compliance with the requirements of Section 162(m) of the Code. Unrestricted Shares, evidenced in such manner as the Committee shall deem appropriate, shall be issued to the holder of Performance Awards promptly after the applicable restrictions have lapsed or otherwise been satisfied.

6.4 Phantom Shares. The Committee shall have the authority to grant Awards of Phantom Shares to Participants upon such terms and conditions as the Committee may determine.

6.4.1 Terms and Conditions . Each Phantom Share Award shall constitute an agreement by the Company to issue or transfer a specified number of Shares or pay an amount of cash equal to the Fair Market Value of a specified number of Shares, or a combination thereof to the Participant in the future, subject to the fulfillment during the Restricted Period of such conditions, including those linked to the Performance Criteria or other specified criteria, including the passage of time, if any, as the Committee may specify at the date of grant. During the Restricted Period, the Participant shall not have any right to transfer any rights under the subject Award, shall not have any rights of ownership in the Phantom Shares and shall not have any right to vote such shares.

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6.4.2 Dividend Equivalents . Any Phantom Share award may provide, in the discretion of the Committee, that any or all dividends or other distributions paid on Shares during the Restricted Period be credited in a cash bookkeeping account (with or without interest) or that equivalent additional Phantom Shares be awarded, which account or Phantom Shares may be subject to the same restrictions as the underlying Award or such other restrictions as the Committee may determine.

6.4.3 Forfeiture and Restrictions Lapse . Except as otherwise determined by the Committee or set forth in the Award Agreement, upon a Participant’s termination of employment or service (as determined under criteria established by the Committee) for any reason during the applicable Restricted Period, all Phantom Shares shall be forfeited by the Participant. The Committee may, in its discretion, waive in whole or in part any or all remaining restrictions with respect to such Participant’s Phantom Shares; provided, however, if the Award is intended to qualify as performance based compensation under Section 162(m) of the Code, such waiver may be only in compliance with the requirements of Section 162(m) of the Code.

6.4.4 Payment of Phantom Shares . To the extent then vested, Phantom Shares shall be paid (in cash and/or in Shares, in the sole discretion of the Committee) in a lump sum following the close of the Restricted Period.

6.5 SARs. The Committee shall have the authority to determine Participants to whom SARs shall be granted, the number of Shares to be covered by each SAR, the exercise price and the conditions and limitations applicable to the exercise of the SAR, including the following terms and conditions and such additional terms and conditions, as the Committee shall determine, that are not inconsistent with the provisions of the Plan. A SAR may be granted (a) in connection and simultaneously with the grant of an Option, (b) with respect to a previously granted Option, or (c) independent of an Option.

6.5.1 Exercise Price . The exercise price per SAR shall be determined by the Committee at the time the SAR is granted, but shall not be less than the Fair Market Value per Share on the effective date of such grant.

6.5.2 Time of Exercise . The Committee shall determine and provide in the Award Agreement the time or times at which a SAR may be exercised in whole or in part.

6.5.3 Method of Payment . The Committee shall determine, in its discretion, whether the SAR shall be paid in cash, shares of Common Stock or a combination of the two.

6.6 Stock Payments. Stock Payments may be made to such Participants in such number of Shares as determined to be appropriate by the Committee, and may be in lieu of, or in addition to, any cash compensation otherwise payable to such Participant.

6.7 Other Stock-Based Awards. The Committee may grant to Participants an Other Stock-Based Award, which shall consist of a right denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, Shares as is deemed by the Committee to be consistent with the purposes of the Plan. Subject to the terms of the Plan, the Committee shall determine the terms and conditions, including performance objectives, if any, of any such Other Stock-Based Award.

6.8 General .

6.8.1 Awards May Be Granted Separately or Together . Awards may, in the discretion of the Committee, be granted either alone or in addition to, in tandem with, any other Award granted under the Plan or any award granted under any other plan of the Company or any Subsidiary. Awards granted in addition to or in tandem with other Awards or awards granted under any other plan of the Company or any Subsidiary may be granted either at the same time as or at a different time from the grant of such other Awards or awards.

6.8.2 Limits on Transfer of Awards .

6.8.2.1 Except as provided in paragraph (C) below, each Award, and each right under any Award, shall be exercisable only by the Participant during the Participant’s lifetime, or if permissible under applicable law, by the Participant’s guardian or legal representative as determined by the Committee.

6.8.2.2 Except as provided in paragraph (C) below, no Award and no right under any such Award may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant,

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and any such purported prohibited assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or any Subsidiary.

6.8.2.3 To the extent specifically approved in writing by the Committee, an Award (other than an ISO) may be transferred to immediate family members or related family trusts, limited partnerships or similar entities or other Persons on such terms and conditions as the Committee may establish or approve. In addition, an Award may be transferred by will or by the laws of descent and distribution or pursuant to a qualified domestic relations order.

6.8.3 Terms of Awards . The term of each Award shall be for such period as may be determined by the Committee; provided, that in no event shall the term of any Award exceed a period of 10 years from the date of its grant.

6.8.4 Share Certificate . All certificates for Shares or other securities of the Company or any Subsidiary delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations, and other requirements of the SEC, any stock exchange upon which such Shares or other securities are then listed, and any applicable federal or state laws, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.

6.8.5 Consideration for Grants . Awards may be granted for no cash consideration or for such consideration as the Committee determines including, without limitation, such minimal cash consideration as may be required by applicable law.

6.8.6 Delivery of Shares or other Securities and Payment by Participant of Consideration . No Shares or other securities shall be delivered pursuant to any Award until payment in full of any amount required to be paid pursuant to the Plan or the applicable Award Agreement (including, without limitation, any exercise price or tax withholding) is received by the Company. Such payment may be made by such method or methods and in such form or forms as the Committee shall determine, including, without limitation, cash, Shares, other securities, other Awards or other property, withholding of Shares, cashless exercise with simultaneous sale, or any combination thereof, provided that the combined value, as determined by the Committee, of all cash and cash equivalents and the Fair Market Value of any such Shares or other property so tendered to the Company, as of the date of such tender, is at least equal to the full amount required to be paid pursuant to the plan or the applicable Award Agreement to the Company.

6.9 Performance Based Compensation . The Committee shall determine which Awards are intended by the Committee to qualify as “performance-based compensation” as described in Section 162(m)(4)(C) of the Code. The Committee shall establish performance goals applicable to those Awards based upon the attainment of such target levels of one or more of the Performance Criteria, over one or more periods of time, which may be of varying and overlapping durations, as the Committee may select. The Performance Criteria shall be subject to adjustment for changes in accounting standards required by the Financial Accounting Standards Board after the goal is established, and, to the extent provided for in the Award Agreement, shall be subject to adjustment for specified significant extraordinary items or events. In this regard, performance goals based on stock price shall be proportionately adjusted for any changes in the price due to a stock split. Performance Criteria may be absolute, relative to one or more other companies, or relative to one or more indexes, and may be contingent upon future performance of the Company or any Subsidiary, division, unit or product line thereof. A performance goal need not be based upon an increase or positive result under a Performance Criteria and could, for example, be based upon limiting economic losses or maintaining the status quo. Which Performance Criteria to be used with respect to any grant, and the weight to be accorded thereto if more than one factor is used, shall be determined by the Committee, in its sole discretion, at the time of grant. To the extent necessary to comply with the qualified performance-based compensation requirements of Section 162(m)(4)(C) of the Code, following the completion of each specified performance period, the Committee shall certify in writing whether the applicable performance goals have been achieved for such performance period. In determining the amount earned by a Participant, the Committee shall have the right to reduce or eliminate (but not to increase) the amount payable at a given level of performance to take into account additional factors that the Committee may deem relevant to the assessment of individual or corporate performance for the performance period. Notwithstanding any other provision of the Plan, any Award which is

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intended to constitute qualified performance-based compensation shall be subject to any additional limitations set forth in Section 162(m) of the Code (including any amendment to Section 162(m) of the Code) or any regulations or rulings issued thereunder that are requirements for qualification as qualified performance-based compensation as described in Section 162(m)(4)(C) of the Code, and the Plan shall be deemed amended to the extent necessary to conform to such requirements.

SECTION 7. Amendment and Termination.

Except to the extent prohibited by applicable law and unless otherwise expressly provided in an Award Agreement or in the Plan:

7.1 Amendments to the Plan. The Board or the Committee may amend, alter, suspend, discontinue, or terminate the Plan without the consent of any stockholder, Participant, other holder or beneficiary of an Award, or other Person; provided, however, notwithstanding any other provision of the Plan or any Award Agreement, without the approval of the stockholders of the Company, except as provided in Section 4(c) of the Plan, (a) no such amendment, alteration, suspension, discontinuation, or termination shall be made that would increase the total number of Shares that may be issued under the Plan, and (b) the exercise price of any outstanding Option or SAR that is greater than the then Fair Market Value of a Share may not be decreased. In all events, shareholder approval shall be obtained when required by the rules of the Nasdaq Stock Market or such other national exchange or market on which the Shares are primarily traded.

7.2 Amendments to Awards. Subject to Paragraph (1) above and Section 3(b), the Committee may waive any conditions or rights under, amend any terms of, or alter any Award theretofore granted, provided no change in any Award shall adversely affect the rights of a Participant under the Award without the consent of such Participant. Notwithstanding the foregoing, with respect to any Award intended to qualify as performance-based compensation under Section 162(m) of the Code, no adjustment other than an acceleration of vesting or payment upon the Participant’s death, disability or change of control of the Company, shall be authorized to the extent such adjustment would cause the Award to fail to so qualify.

SECTION 8. General Provisions.

8.1 No Rights to Awards. No Participant or other Person shall have any claim to be granted any Award, there is no obligation for uniformity of treatment of Participants, or holders or beneficiaries of Awards and the terms and conditions of Awards need not be the same with respect to each recipient.

8.2 Tax Withholding. The Company or any Subsidiary is authorized to withhold from any Award, from any payment due or transfer made under any Award or from any compensation or other amount owing to a Participant the amount (in cash, Shares, or other property) of any applicable taxes required to be withheld by the Company or Subsidiary in respect of the Award, its exercise, the lapse of restrictions thereon, or any payment or transfer under the Award and to take such other action as may be necessary in the opinion of the Company to satisfy all of its obligations for the payment of such taxes. In addition, the Committee may provide that the Participant may direct the Company to satisfy the Company’s tax withholding obligations through the withholding of Shares otherwise to be acquired upon the exercise or payment of such Award.

8.3 No Right to Employment or Retention. The grant of an Award shall not be construed as giving a Participant the right to be retained in the employ of the Company or any Subsidiary or under any other service contract with the Company or any Subsidiary, or to remain on the Board. Further, the Company or a Subsidiary may at any time dismiss a Participant from employment or terminate any contractual agreement or relationship with any Consultant, free from any liability or any claim under the Plan, with or without cause, unless otherwise expressly provided in the Plan, in any Award Agreement or any other agreement or contract between the Company or a Subsidiary and the affected Participant. If a Participant’s employer ceases to be a Subsidiary, such Participant shall be deemed to have terminated employment for purposes of the Plan, unless specifically provided otherwise in the Award Agreement. A Participant shall not be considered to have a termination of employment or service in the case of any approved leave of absence; provided, however, that for purposes of ISOs such leave is not for a period of more than three months, unless reemployment upon expiration of the leave is guaranteed by contract or statute. Transfers between the Company and Subsidiaries or between the status of Employee, Director or Consultant shall not be a termination of employment or service

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except with respect to Awards subject to Section 409A of the Code, to the extent provided otherwise by Section 409A and the regulations thereunder.

8.4 Corporate Transactions and Change of Control. In the event of any distribution (whether in the form of cash, Shares, other securities, or other property), recapitalization, reorganization, merger, spin-off, combination, repurchase, or exchange of Shares or other securities of the Company, or other similar corporate transaction or event or any unusual or nonrecurring transactions or events affecting the Company, any affiliate of the Company, or the financial statements of the Company or any affiliate, or of changes in applicable laws, regulations or accounting principles, and whenever the Committee determines that action is appropriate in order to prevent the dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to any Award under the Plan, to facilitate such transactions or events or to give effect to such changes in laws, regulations or principles, the Committee, in its sole discretion and on such terms and conditions as it deems appropriate, either by amendment of the terms of any outstanding Awards or by action taken prior to the occurrence of such transaction or event and either automatically or upon the Participant’s request, is hereby authorized to take any one or more of the following actions:

8.4.1 To provide for either (A) termination of any such Award in exchange for an amount of cash, if any, equal to the amount that would have been attained upon the exercise of such Award or realization of the Participant’s rights (and, for the avoidance of doubt, if as of the date of the occurrence of the transaction or event described in this Section 8(d) the Committee determines in good faith that no amount would have been attained upon the exercise of such Award or realization of the Participant’s rights, then such Award may be terminated by the Company without payment) or (B) the replacement of such Award with other rights or property selected by the Committee in its sole discretion;

8.4.2 To provide that such Award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by similar options, rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices; and

8.4.3 To make adjustments in the number and type of shares of common Stock (or other securities or property) subject to outstanding Awards, and in the number and kind of outstanding Awards and/or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding Awards and Awards which may be granted in the future;

8.4.4 To provide that such Award shall be exercisable or payable or fully vested with respect to all or part of the Shares covered thereby, notwithstanding anything to the contrary in the Plan or the applicable Award Agreement; and

8.4.5 To provide that the Award cannot vest, be exercised or become payable after such event.

Notwithstanding any other provision of this Plan to the contrary, unless specifically provided otherwise in an Award Agreement, in the event of a Change of Control all outstanding Awards automatically shall become fully vested on such Change of Control (or such earlier time as may be established by the Committee), all restrictions, if any, with respect to such Awards shall lapse, including, without limitation, any service, longevity or other employment requirements, and all Performance Criteria, if any, with respect to such Awards shall be deemed to have been met in full to the maximum extent without regard to any proration provisions in such Award or Award Agreement.

In addition to, or in lieu of, any other provision of the Plan, the Committee may provide that all Awards not exercised upon or prior to a Change of Control shall (x) terminate on such Change of Control, (y) be assumed by the successor (or a parent thereof) in any merger or other corporate transaction, or (z) be surrendered in exchange for substantially economically equivalent substitute Awards (with the substantially same material terms as the surrendered Award, including 100% vesting) from the successor (or a parent thereof).

8.5 Governing Law. The validity, construction, and effect of the Plan and any rules and regulations relating to the Plan shall be determined in accordance with the laws of the State of Texas and applicable federal law.

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8.6 Severability. If any provision of the Plan or any Award is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as to any Person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, Person or Award and the remainder of the Plan and any such Award shall remain in full force and effect.

8.7 Other Laws. The Committee may refuse to issue or transfer any Shares or other consideration under an Award, permit the exercise of an Award and/or the satisfaction of its tax withholding obligation in the manner elected by the Participant, holder or beneficiary if, acting in its sole discretion, it determines that the issuance of transfer or such Shares or such other consideration, the manner of exercise or satisfaction of the tax withholding obligation might violate any applicable law or regulation, including without limitation, the Sarbanes-Oxley Act, or entitle the Company to recover the same under Section 16(b) of the Exchange Act, and any payment tendered to the Company by a Participant, other holder or beneficiary in connection with the exercise of such Award shall be promptly refunded or refused, as the case may be, to the relevant Participant, holder or beneficiary.

8.8 No Trust or Fund Created. Neither the Plan nor the Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any Subsidiary and a Participant or any other Person. To the extent that any Person acquires a right to receive payments from the Company or any Subsidiary pursuant to an Award, such right shall be no greater than the right of any general unsecured creditor of the Company or any Subsidiary.

8.9 No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the Plan or any Award, and the Committee shall determine whether cash, other securities, or other property shall be paid or transferred in lieu of any fractional Shares or whether such fractional Shares or any rights thereto shall be cancelled, terminated, or otherwise eliminated.

8.10 Headings. Headings are given to the Section and subsections of the Plan solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the plan or any provision thereof.

SECTION 9. Amendment and Restatement of Prior Plan/Merger of 2000 Plan.

The Plan is an amendment and restatement of the Prior Plan, which is hereby renamed the Mitcham Industries, Inc. Stock Awards Plan (the “Plan”). In addition, the 2000 Plan is hereby merged into the Plan. Nothing in this Plan shall change or modify the terms or rights under any Award granted under the Prior Plan or the 2000 Plan.

SECTION 10. Term of the Plan.

This amendment and restatement of the Prior Plan and the merger of the 2000 Plan into the Plan shall not become effective until the date the Plan is approved by the stockholders of the Company. If it is not approved by the stockholders, the Plan shall be null and void for all purposes. No Award shall be granted with respect to newly authorized shares under this Plan prior to its approval by the stockholders of the Company and no Awards shall be granted after the 10th anniversary of the date this amendment and restatement of the Prior Plan was adopted by the Board. However, unless otherwise expressly provided in the Plan, the Prior Plan, the 2000 Plan or an applicable award agreement, any Award granted prior to such termination of the Plan, and the authority of the Board or the Committee to amend, alter, adjust, suspend, discontinue, or terminate any such Award or to waive any conditions or rights under such Award, shall extend beyond such termination date.

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e2 conversion VOTE BY INTERNET — www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic PN 101 and up delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create MITCHAM INDUSTRIES, INC. an electronic voting instruction form. 8141 SH 75 SOUTH ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS HUNTSVILLE, TX 77340 If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: M15497-P82668 KEEP THIS PORTION FOR YOUR RECORDS THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY MITCHAM INDUSTRIES, INC. For Withhold For All To withhold authority to vote for any individual All All Except nominee(s), mark “For All Except” and write the THE BOARD OF DIRECTORS RECOMMENDS number(s) of the nominee(s) on the line below. A VOTE FOR PROPOSALS (1), (2) AND (3). 1. ELECTION OF DIRECTORS 0 0 0 Nominees: 01) Billy F. Mitcham, Jr. 02) Peter H. Blum 03) Robert P. Capps 04) R. Dean Lewis 05) John F. Schwalbe 06) Robert J. Albers For Against Abstain Vote on Proposals 2. APPROVAL OF AN AMENDMENT TO THE MITCHAM INDUSTRIES, INC. STOCK AWARDS PLAN TO INCREASE THE 0 0 0 SHARES OF COMMON STOCK AUTHORIZED FOR ISSUANCE UNDER THE PLAN BY 350,000 SHARES. 3. RATIFICATION OF THE SELECTION OF HEIN & ASSOCIATES LLP AS MITCHAM INDUSTRIES, INC.’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE FISCAL YEAR ENDING JANUARY 31, 2010. 0 0 0 Yes No Please indicate if you plan to attend this meeting. 0 0 Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date h66924_1

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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com. M15498-P82668 MITCHAM INDUSTRIES, INC. PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON THURSDAY, JULY 23, 2009 The undersigned hereby constitutes and appoints Billy F. Mitcham, Jr. and Peter H. Blum, and each of them, the attorneys and proxies of the undersigned with full power of substitution to appear and to vote all of the shares of the common stock of Mitcham Industries, Inc. held of record by the undersigned on May 26, 2009 as if personally present at the Annual Meeting of Shareholders to be held on Thursday, July 23, 2009, and any adjournment or postponement thereof, as designated on the reverse. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF MITCHAM INDUSTRIES, INC. THE PROXY WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED “FOR” EACH OF THE PROPOSALS LISTED ON THE REVERSE AND ACCORDING TO THE DISCRETION OF THE PROXY HOLDERS ON ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING. THIS PROXY REVOKES ALL PREVIOUSLY SIGNED PROXIES. YOU ARE URGED TO DATE, SIGN AND RETURN PROMPTLY THIS PROXY IN THE ENVELOPE PROVIDED. IT IS IMPORTANT FOR YOU TO BE REPRESENTED AT THE ANNUAL MEETING. THIS PROXY MUST BE RECEIVED BY MAIL IN THE POSTAGE-PAID ENVELOPE PROVIDED OR ELECTRONICALLY VIA THE INTERNET AT www.proxyvote.com OR BY PHONE AT+1-800-690-6903.

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