Common use of Further Covenants of the Company Clause in Contracts

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the opinion of counsel to the Placement Agent and the Company, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent may request. The Company shall not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent shall not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance with the Act, the regulations thereunder and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units or the Securities for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its best efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (b) The Company will use its commercially reasonable efforts to assist counsel to the Placement Agent in qualifying the Units for sale under the securities laws of such U.S. jurisdictions as may be mutually agreed to by the Company and the Placement Agent; provided, that the Company will not be required or obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the Units. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement Agent. The Company or its counsel will provide counsel for the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company reasonably deem necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units are to be offered or sold. (c) The Company shall place a legend on the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Warrants and Agent’s Warrant Shares, stating that the securities evidenced thereby have not been registered under the Act or applicable state securities laws, setting forth or referring to the applicable restrictions on transferability and sale of such securities under the Act and applicable state laws. (d) The Company shall apply the net proceeds from the sale of the Units to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. and for such other purposes as are specifically described under “Use of Proceeds” in the Memorandum. (e) During the Offering Period, the Company shall make available for review by prospective Investors during normal business hours at the Company’s offices, upon their request, copies of such corporate documents, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, and shall afford each prospective Investor the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expense. (f) Until the earlier of (i) completion of the Offering, and (ii) the Termination Date, neither the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a private or public offering of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition as contemplated in the Memorandum. Except as contemplated in the Memorandum, neither the Company nor anyone acting on its behalf shall, until the Termination Date, offer for sale to, or solicit offers to subscribe for Units or other securities of the Company from, or otherwise approach or negotiate in respect thereof with, any other person. (g) Until the earlier of (i) the Termination Date and (ii) the Final Closing, neither the Company nor the Placement Agent will issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media in any manner whatsoever without the other party’s prior written consent, which consent will not unreasonably be withheld or delayed. (h) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising the Units and the Agent’s Warrants, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. In addition, the Company will pay all reasonable filing fees, costs and legal fees for Blue Sky services and related filings and reasonable expenses of counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions (“Blue Sky Expenses”). Additional amounts, if any, for required filing fees shall be paid at any subsequent Closing, as applicable. The Blue Sky filings shall be prepared by the Placement Agent’s counsel for the Company’s account. Further, as promptly as practicable after the Closing, the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to the Placement Agent. (i) Effective upon the sale of the Minimum Amount, the Placement Agent shall have a twelve (12) month right of first refusal from such date to act as a lead placement agent on any future private placement of the Company’s securities in which the Company seeks to utilize a third party placement agent or as a lead managing underwriter on any public offering of the Company’s securities in which the Company seeks to utilize a third party underwriter. It is understood that if a third party broker- dealer provides the Company with written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to the Placement Agent. The Placement Agent shall have ten (10) business days from its receipt of the Written Offering Terms in which to determine whether or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) during the remainder of such twelve (12) month period. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing of the Offering involving an aggregate of $3 million from PARL Investors.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the opinion of counsel to the Placement Agent Agents and the Company, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent Agents and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent Agents copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent Agents may request. The Company shall not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent Agents shall not previously have been advised and furnished with a copy, or to which the Placement Agent Agents or its their counsel have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance with the Act, the regulations thereunder Securities Act and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent Agents and its their counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units Series C Preferred Stock or the Underlying Securities for offering or the suspension of any exemption for such qualification or registration of the Units Series C Preferred Stock or the Underlying Securities for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its reasonable best efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (b) The Company will use its commercially reasonable best efforts to assist counsel to the Placement Agent Agents in qualifying the Units Series C Preferred Stock for sale under the securities laws of such U.S. jurisdictions as may be mutually agreed to by the Company and the Placement AgentAgents; provided, however, that the Company will not be required or obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the UnitsSeries C Preferred Stock. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement AgentAgents. The Company or its counsel will provide counsel for the Placement Agent Agents with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units Series C Preferred Stock are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent Agents for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent Agents or the Company reasonably deem deems necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units Series C Preferred Stock are to be offered or sold. (c) The Company shall place a legend on the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Warrants shares of Series C Preferred Stock and Agent’s Warrant Shares, the Underlying Securities stating that the securities evidenced thereby have not been registered under the Securities Act or applicable state securities laws, setting forth or referring to the applicable restrictions on transferability and sale of such securities under the Securities Act and applicable state laws. (d) The Company shall apply the net proceeds from the sale of the Units to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. and for such other purposes Series C Preferred Stock as are specifically described under “Use of Proceeds” in the Memorandum. (e) During the Offering Period, the Company shall make available for review by prospective Investors, provided that such prospective Investors have executed confidentiality agreements in a form acceptable to the Company, during normal business hours at the Company’s officesoffices or by means of a secure virtual dataroom or other secure digital communication, upon their request, copies of such corporate documents, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, and shall afford each prospective Investor the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expense. (f) Until the earlier of (i) completion of the Offering, Offering and (ii) the Termination Date, neither the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a new private or public offering of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition as contemplated in the Memorandumsecurities. Except as contemplated in the Memorandum, neither the Company nor anyone acting on its behalf shall, until the Termination Date, offer for sale to, or solicit offers to subscribe for Units Series C Preferred Stock or other securities of the Company or the OP from, or otherwise approach or negotiate in respect thereof with, any other person. (g) Until the earlier of (i) the Termination Date and (ii) the Final Closing, neither the Company nor the Placement Agent Agents will issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media in any manner whatsoever without the other party’s prior written consent, which consent will not unreasonably be withheld or delayed. (h) The Company will use its best efforts to effect the listing the Underlying Securities on the NASDAQ Capital Market. (i) The Company shall pay all reasonable and documented expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising the Units and the Agent’s WarrantsSeries C Preferred Stock, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent Agents may reasonably request. In addition, the Company will pay all reasonable filing fees, costs and legal fees for Blue Sky services and related filings and reasonable expenses of counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions (“Blue Sky Expenses”). Additional amounts, if any, for required filing fees shall be paid at any subsequent Closing, as applicable. The Blue Sky filings shall be prepared by the Placement Agent’s counsel for the Company’s account. Further, as promptly as practicable after the Closing, the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to the Placement Agent. (ij) Effective upon the sale of the Minimum AmountClosing Date, the Placement Agent Compass Point shall have a twelve (12) month right of first refusal from such date for the period beginning on the Closing Date and ending on the 365th day following the Closing Date to act as a lead managing underwriter or lead placement agent on and lead bookrunner in connection with any future public or private placement offering of equity securities or securities convertible into equity securities contemplated by the Company’s securities in which the Company seeks to utilize a third party placement agent or as a lead managing underwriter on any public offering of the Company’s securities in which the Company seeks to utilize a third party underwriter. It is understood that if a third party broker- dealer provides the Company with written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to the Placement Agent. The Placement Agent Compass Point shall have ten (10) business days from its receipt of the written terms offering such engagement (the “Written Offering Terms Terms”) in which to determine whether or not to accept such offer and, if the Placement Agent Compass Point refuses, and provided that such financing is consummated (aA) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (bB) within three months after the end of the aforesaid ten (10) business 10)-business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses clause (aA) and (bB) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) 6 during the remainder of such twelve (12) month 365-day period. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing of the Offering involving an aggregate of $3 million from PARL Investors.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) Except with the prior written consent of the Placement Agent, the Company shall not, at any time prior to the Final Closing, take any action which would cause any of the representations, warranties and covenants made by it in this Agreement not to be complete, accurate and correct on and as of each Closing Date with the same force and effect as if such representations, warranties and covenants had been made on and as of each such date. (b) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the reasonable opinion of counsel to the Placement Agent and the CompanyAgent, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent may request. The Company shall not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent shall not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel will have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance in all material respects with the Securities Act, the regulations thereunder Regulations and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units or the Securities Shares for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities Shares for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its best efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (bc) The Company shall comply with the Securities Act, the Regulations, the Exchange Act, and the rules and regulations promulgated thereunder, all applicable state securities laws and the rules and regulations thereunder in the states in which the Shares are to be offered and in which Blue Sky counsel has advised the Placement Agent that the Shares are exempt from qualification or registration requirements, so as to permit the continuance of the sales of the Shares, and will use its commercially reasonable efforts to assist counsel file with the SEC, and shall promptly thereafter forward to the Placement Agent in qualifying Agent, any and all reports on Form D as are required. (d) The Company shall use its best efforts to qualify the Units Shares for sale under the securities laws of such U.S. jurisdictions in the United States as may be mutually agreed to by the Company and the Placement Agent; provided, and the Company shall make such applications and furnish information as may be required for such purposes, provided that the Company will shall not be required or obligated to qualify to do business as a foreign corporation in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the Units. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement Agentjurisdiction. The Company shall, from time to time, prepare and file such statements and reports as are or its counsel will provide counsel may be required to continue such qualifications in effect for so long a period as the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company may reasonably deem necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units are to be offered or soldrequest. (ce) The Company shall place a legend on the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Warrants and Agent’s Warrant Shares, Shares issued to Subscribers stating that the securities evidenced thereby have not been registered under the Securities Act or applicable state securities lawslaws and cannot be sold or otherwise transferred without an effective registration or an exemption therefrom, setting forth or referring and may not be sold pursuant to the applicable restrictions on transferability and sale exemptions provided by Section 4(1) of such securities the Securities Act or Rule 144 under the Act Securities Act, in accordance with the letter from Xxxxxxx X. Xxxxx, Chief of the Office of Small Business Policy of the Securities and applicable state lawsExchange Commission’s Division of Corporation Finance, to Xxx Worm of NASD Regulation, Inc., dated January 21, 2000. (df) The Company shall apply the net proceeds from the sale of the Units Shares to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. working capital requirements and for such other purposes as are specifically described under the “Use of Proceeds” section of the Memorandum. Except as set forth in the Memorandum, the Company shall not use any of the net proceeds of the Offering to repay indebtedness to officers, directors or stockholders of the Company without the prior written consent of the Placement Agent. (eg) During the Offering Period, the Company shall make available for review by prospective Investors purchasers of the Shares during normal business hours at the Company’s offices, upon their request, copies of such corporate documents, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, all Company agreements to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, thereof and shall afford each prospective Investor purchaser of Shares the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expenseexpense or effort. (fh) Until Except with the earlier of (i) completion prior written consent of the OfferingPlacement Agent, and (ii) the Company shall not, at any time prior to the later of the Final Closing or the Termination Date, neither (i) engage in or commit to engage in any transaction outside the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a private or public offering ordinary course of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition business as contemplated in the Memorandum. Except as contemplated described in the Memorandum, neither (ii) issue, agree to issue or set aside for issuance any securities (debt or equity) or any rights to acquire any such securities except as contemplated by the Company nor anyone acting on its behalf shallMemorandum, until (iii) incur, outside the Termination Date, offer for sale to, or solicit offers to subscribe for Units or other securities ordinary course of the Company from, or otherwise approach or negotiate in respect thereof withbusiness, any other personmaterial indebtedness, (iv) dispose of any material assets, (v) make any material acquisition or (vi) change its business or operations. (g) Until the earlier of (i) the Termination Date and (ii) the Final Closing, neither the Company nor the Placement Agent will issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media in any manner whatsoever without the other party’s prior written consent, which consent will not unreasonably be withheld or delayed. (h) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising the Units Shares and the Agent’s WarrantsSecurities, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. In addition, the Company will shall pay all reasonable filing fees, costs and legal fees for Blue Sky services and related filings and reasonable expenses of the Placement Agent’s counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions (collectively, the “Blue Sky Expenses”). Additional , $450 per state, which shall be paid to the Company’s counsel upon execution of this Agreement for legal fees in connection with obtaining Blue Sky exemptions, and additional amounts, if any, for required filing fees of which shall be paid at any subsequent each Closing, as applicable. The Blue Sky filings shall be prepared by the Placement AgentCompany’s counsel for the Company’s account. Further, as promptly as practicable after the Closing, the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to the Placement Agent. (ij) Effective upon Until the sale later of the Minimum AmountFinal Closing or the Termination Date, the Placement Agent shall have a twelve (12) month right of first refusal from such date to act as a lead placement agent on any future private placement of the Company’s securities in which neither the Company seeks to utilize a third party nor any person or entity acting on its behalf shall negotiate with any other placement agent or as underwriter with respect to a lead managing underwriter on any private or public offering of the Company’s securities in which or any affiliate’s debt or equity securities. Neither the Company seeks nor anyone acting on its behalf shall, until the later of the Final Closing or the Termination Date, offer for sale to, or solicit offers to utilize a third party underwriter. It is understood that if a third party broker- dealer provides subscribe for Shares or other securities of the Company with from, or otherwise approach or negotiate in respect thereof with, any other person, without the prior written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to consent of the Placement Agent. The Placement Agent shall have ten (10) business days from its receipt of the Written Offering Terms in which to determine whether or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) during the remainder of such twelve (12) month period. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing of the Offering involving an aggregate of $3 million from PARL Investors.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the opinion of counsel to the Placement Agent and the Company, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent may request. The Company shall not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent shall not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel will have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance with the Act, the regulations thereunder and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units or the Securities for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its best efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (b) The Company will use its commercially reasonable efforts to assist counsel to the Placement Agent in qualifying the Units for sale under the securities laws of such U.S. jurisdictions as may be mutually agreed to by the Company and the Placement Agent; provided, that the Company will not be required or obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the Units. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement Agent. The Company or its counsel will provide counsel for the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company reasonably deem necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units are to be offered or sold. (c) The Company shall place a legend on the certificates representing the Units, if any, and the Shares, Warrants, Warrant Shares, Agent’s 's Warrants and Agent’s 's Warrant Shares, issued to subscribers stating that the securities evidenced thereby have not been registered under the Act or applicable state securities laws, setting forth or referring to the applicable restrictions on transferability and sale of such securities under the Act and applicable state laws. (d) The Company shall apply the net proceeds from the sale of the Units to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. working capital requirements and for such other purposes as are specifically described under “Use of Proceeds” in the Memorandum. (e) During the Offering Period, the Company shall make available for review by prospective Investors during normal business hours at the Company’s offices, upon their request, copies of such corporate documents, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, and shall afford each prospective Investor the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expense. (f) Until the earlier of (i) completion of the Offering, and (ii) the Termination Date, neither the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a private or public offering of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition transactions contemplated by the Ariston Merger as contemplated in the Memorandum. Except as contemplated in the Memorandum, neither the Company nor anyone acting on its behalf shall, until the Termination Date, offer for sale to, or solicit offers to subscribe for Units or other securities of the Company from, or otherwise approach or negotiate in respect thereof with, any other person. (g) Until the earlier of (i) the Termination Date and (ii) the Final Closing, neither the Company nor the Placement Agent will not issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media in any manner whatsoever without the other partyPlacement Agent’s prior written consent, which consent will not unreasonably be withheld or delayed. (h) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising Units, the Units Common Stock, Warrants and the Agent’s Warrants, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. The Blue Sky filings shall be prepared by the Placement Agent’s counsel for the Company’s account, with copies to Company’s counsel concurrently (or as soon as sent or received as reasonable possible) of the filings, correspondence, orders, findings and all related matters. In addition, the Company will shall pay all filing fees and reasonable filing fees, costs and legal fees and expenses for Blue Sky services and related filings and reasonable out-of-pocket expenses of the Placement Agent’s counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions that are sought with respect to the Offering (the “Blue Sky Expenses”). Additional , $6,000 of which shall be paid to the Placement Agent’s counsel upon the First Closing, and additional reasonable amounts, if any, for required filing fees of which shall be paid at any subsequent Closing, as applicable. The Blue Sky filings shall be prepared by the Placement Agent’s counsel for the Company’s account. Further, as promptly as practicable after the Closing, the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to the Placement Agent. (i) Effective upon the sale of the Minimum Amount, the Placement Agent shall have a twelve (12) month right of first refusal from such date to act as a lead placement agent on any future private placement of the Company’s securities in which the Company seeks to utilize a third party placement agent or as a lead managing underwriter on any public offering of the Company’s securities in which the Company seeks to utilize a third party underwriter. It is understood that if a third party broker- broker-dealer provides the Company with written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to the Placement Agent. The Placement Agent shall have ten (10) business days from its receipt of the Written Offering Terms in which to determine whether or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h6(i) during the remainder of such twelve (12) month period. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing of the Offering involving an aggregate of $3 million from PARL Investors.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) Except with the prior written consent of the Placement Agent, the Company shall not, at any time prior to the Final Closing, take any action which would cause any of the representations, warranties and covenants made by it in this Agreement not to be complete, accurate and correct, in all material respects, on and as of each Closing Date with the same force and effect as if such representations, warranties and covenants had been made on and as of each such date. (b) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the reasonable opinion of counsel to the Placement Agent and the CompanyAgent, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent may request. The Company shall not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent shall not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel will have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance in all material respects with the Act, the regulations thereunder Regulations and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units or the Securities for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its best efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (bc) The Company shall comply with the Act, the Regulations, the Securities Exchange Act of 1934, as amended (the “1934 Act”), and the rules and regulations promulgated thereunder, all applicable state securities laws and the rules and regulations thereunder in the states in which the Units are to be offered and in which Blue Sky counsel has advised the Placement Agent that the Units are exempt from qualification or registration requirements, so as to permit the continuance of the sales of the Units, and will use its commercially reasonable efforts to assist counsel file with the SEC, and shall promptly thereafter forward to the Placement Agent in qualifying Agent, any and all reports on Form D as are required. (d) The Company shall use its best efforts to qualify the Units for sale under the securities laws of such U.S. jurisdictions in the United States as may be mutually agreed to by the Company and the Placement Agent; provided, and the Company shall make such applications and furnish information as may be required for such purposes, provided that the Company will shall not be required or obligated to qualify to do business as a foreign corporation in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the Units. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement Agentjurisdiction. The Company shall, from time to time, prepare and file such statements and reports as are or its counsel will provide counsel may be required to continue such qualifications in effect for so long a period as the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company may reasonably deem necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units are to be offered or soldrequest. (ce) The Company shall place a legend on the Notes and the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Warrants Shares and Agent’s Warrant Shares, the Conversion Shares issued to subscribers stating that the securities evidenced thereby have not been registered under the Act or applicable state securities laws, setting forth or referring to the applicable restrictions on transferability and sale of such securities under the Act and applicable state laws. (df) The Company shall apply the net proceeds from the sale of the Units to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. working capital requirements and for such other purposes as are specifically described under the “Use of Proceeds” section of the Memorandum. Except as set forth in the Memorandum, the Company shall not use any of the net proceeds of the Offering to repay indebtedness to officers, directors or stockholders of the Company without the prior written consent of the Placement Agent. (eg) During the Offering Period, the Company shall make available for review by prospective Investors purchasers of the Units during normal business hours at the Company’s offices, upon their request, copies of such corporate documents, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, the Company Agreements to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, thereof and shall afford each prospective Investor purchaser of Units the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expenseexpense or effort. (fh) Until Except with the earlier of (i) completion prior written consent of the OfferingPlacement Agent, and (ii) the Company shall not, at any time prior to the later of the Final Closing or the Termination Date, neither (i) engage in or commit to engage in any transaction outside the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a private or public offering ordinary course of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition business as contemplated in the Memorandum. Except as contemplated described in the Memorandum, neither (ii) issue, agree to issue or set aside for issuance any securities (debt or equity) or any rights to acquire any such securities except (A) as contemplated by the Company nor anyone acting on its behalf shallMemorandum, until (B) upon exercise of outstanding options or warrants as of the Termination Date, offer for sale to, date hereof or solicit offers to subscribe for Units (C) the issuance of any options or other securities equity awards made under the Company’s existing equity incentive plans, (iii) incur, outside the ordinary course of the Company from, or otherwise approach or negotiate in respect thereof withbusiness, any other personmaterial indebtedness, (iv) dispose of any material assets, (v) make any material acquisition or (vi) change its business or operations. (g) Until the earlier of (i) the Termination Date and (ii) the Final Closing, neither the Company nor the Placement Agent will issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media in any manner whatsoever without the other party’s prior written consent, which consent will not unreasonably be withheld or delayed. (h) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising Notes, Warrants, Warrant Shares, the Units and Conversion Shares, the Agent’s WarrantsSecurities, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. In addition, the Company will shall pay all reasonable filing fees, costs and legal fees for Blue Sky services and related filings and reasonable expenses of the Placement Agent’s counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions (collectively, the “Blue Sky Expenses”). Additional , $5,000 of which shall be paid to the Placement Agent’s counsel upon execution of this Agreement for legal fees in connection with obtaining Blue Sky exemptions, and additional amounts, if any, for required filing fees of which shall be paid at any subsequent Closing, as applicable. The Blue Sky filings shall be prepared by the Placement Agent’s counsel for the Company’s account. Further. (j) Until the Termination Date, as promptly as practicable after the Closing, neither the Company nor any person or entity acting on its behalf shall preparenegotiate with any other placement agent or underwriter with respect to a private or public offering of the Company’s or any affiliate’s debt or equity securities. Neither the Company nor anyone acting on its behalf shall, at its own expenseuntil the Termination Date, “velobound closing binders” relating offer for sale to, or solicit offers to subscribe for Units or other securities of the Offering and will distribute such binders to Company from, or otherwise approach or negotiate in respect thereof with, any other person, without the individuals designated by counsel to prior written consent of the Placement Agent. (ik) Effective upon On or prior to the sale of First Closing, the Minimum Amount, Company and the Placement Agent shall have enter into a Right of First Refusal Agreement (the “ROFR Agreement”) in a form acceptable to the Company and the Placement Agent and their respective counsels. The ROFR Agreement shall provide that for a period of twelve (12) month months from the First Closing, the Company shall give the Placement Agent the irrevocable preferential right of first refusal from such date described below to purchase for the Placement Agent’s account or to act as a lead placement agent on for any future proposed private placement of the Company’s securities in which the Company seeks to utilize a third party placement agent or as a lead managing underwriter on any public offering of the Company’s securities in which the Company seeks to utilize a third party underwriter. It is understood that if a third party broker- dealer provides the Company with written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to the Placement Agent. The Placement Agent shall have ten (10equity or debt) business days from its receipt of the Written Offering Terms in which to determine whether or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) during the remainder of such twelve (12) month period. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of by the Company. The Company shall use its best efforts agrees to cause offer the Board of Directors Placement Agent the opportunity to take necessary action to facilitate this appointment at the time of a closing purchase or sell such securities on terms no less favorable than it can obtain elsewhere. If within 20 business days of the Offering involving an aggregate receipt of $3 million from PARL Investorssuch notice of intention and statement of terms the Placement Agent does not accept in writing such offer to purchase such securities or to act as agent with respect to such offering upon the terms proposed, the Company shall be free to negotiate terms with third parties with respect to such offering and to effect such offering on such proposed terms. Before the Company shall accept any proposal materially less favorable to it than as originally proposed to the Placement Agent, the Placement Agent’s preferential rights shall be applied, and the procedure set forth above with respect to such modified proposal shall be adopted. The Placement Agent’s failure to exercise these preferential rights in any situation shall not affect the Placement Agent’s preferential rights to any subsequent offering during the term of the ROFR Agreement. The Company represents and warrants that no other person has any right to participate in any offer, sale or distribution of the Company’s securities to which the Placement Agent’s preferential rights shall apply. (l) Until the later of the Termination Date or the Final Closing, the Company will not issue any press release, grant any interview, or otherwise communicate with the media in any manner whatsoever without the Placement Agent’s prior written consent, which consent will not unreasonably be withheld. (m) The Company will file a proxy statement as soon as practicable after the Final Closing for the Share Increase.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) Except with prior written notice to the Placement Agent, the Company shall not, at any time prior to the Final Closing, take any action which would cause any of the representations, warranties and covenants made by it in this Agreement not to be complete, accurate and correct on and as of each Closing Date with the same force and effect as if such representations, warranties and covenants had been made on and as of each such date. (b) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the reasonable opinion of counsel to the Placement Agent and the CompanyAgent, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent may request. The Company shall not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent shall not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel will have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance in all material respects with the Act, the regulations thereunder Regulations and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units or the Securities Convertible Notes for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities Convertible Notes for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its best efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (bc) The Company shall comply with the Act, the Regulations, the Exchange Act, and the rules and regulations promulgated thereunder, all applicable state securities laws and the rules and regulations thereunder in the states in which the Convertible Notes are to be offered and in which counsel has advised the Placement Agent that the Convertible Notes are exempt from qualification or registration requirements, so as to permit the continuance of the sales of the Convertible Notes, and will use its commercially reasonable efforts to assist counsel file with the SEC, and shall promptly thereafter forward to the Placement Agent in qualifying Agent, any and all reports on Form D as are required. (d) The Company shall use its best efforts to qualify the Units Convertible Notes for sale under the securities laws of such U.S. jurisdictions in the United States as may be mutually agreed to by the Company and the Placement Agent; provided, and the Company shall make such applications and furnish information as may be required for such purposes, provided that the Company will shall not be required or obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action which would subject it as a foreign corporation, file a general consent to service of process or subject itself to taxation in suits, other than those arising out of the offering or sale of the Units. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement Agentany jurisdiction. The Company shall, from time to time, prepare and file such statements and reports as are or its counsel will provide counsel may be required to continue such qualifications in effect for so long a period as the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company may reasonably deem necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units are to be offered or soldrequest. (ce) The Company shall place a legend on the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Warrants and Agent’s Warrant Shares, Convertible Notes issued to subscribers stating that the securities evidenced thereby have not been registered under the Act or applicable state securities laws, setting forth or referring to the applicable restrictions on transferability and sale of such securities under the Act and applicable state laws. (df) The Company shall apply the net proceeds from the sale of the Units to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. and Convertible Notes for such other the purposes as are specifically described under the “Use of Proceeds” section of the Memorandum. Except as set forth in the Memorandum, the Company shall not use any of the net proceeds of the Offering to repay indebtedness to officers, directors or stockholders of the Company without the prior written consent of the Placement Agent. (eg) During the Offering Period, the Company shall make available for review by prospective Investors purchasers of the Convertible Notes during normal business hours at the Company’s offices, upon their request, copies of such corporate documents, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, the Company Agreements to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, thereof and shall afford each prospective Investor purchaser of Convertible Notes the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expenseexpense or effort. (fh) Until Except with the prior written consent of the Placement Agent, the Company shall not, at any time prior to the earlier of (i) completion of the Offering, and (ii) Final Closing or the Termination Date, neither (i) engage in or commit to engage in any transaction outside the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a private or public offering ordinary course of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition business as contemplated in the Memorandum. Except as contemplated described in the Memorandum, neither (ii) issue, agree to issue or set aside for issuance any securities (debt or equity) or any rights to acquire any such securities except as contemplated by the Company nor anyone acting on its behalf shallMemorandum, until (iii) incur, outside the Termination Date, offer for sale to, or solicit offers to subscribe for Units or other securities ordinary course of the Company from, or otherwise approach or negotiate in respect thereof withbusiness, any other personmaterial indebtedness, (iv) dispose of any material assets, (v) make any material acquisition or (vi) change its business or operations inconsistent with the business described in the Memorandum. (g) Until the earlier of (i) The Company shall at all times continue to comply with its reporting and other obligations under the Termination Date and (ii) Exchange Act. Without limiting the generality of the foregoing, commencing upon the Final Closing, neither Closing the Company nor shall deliver to the Placement Agent will issue any press releaseand the purchasers of the Convertible Notes such periodic and other reports as are customarily delivered to the Company’s stockholders, grant any media interview including but not limited to annual reports containing audited financial statements setting forth fairly the financial position of the Company. In addition, the Company shall deliver to the Placement Agent such quarterly unaudited financial statements as are prepared for the Company’s Board of Directors and a copy of a list of its stockholders as and when so requested, (including without limitation, internet media outlets), or otherwise communicate only for use in connection with the media in any manner whatsoever without the other party’s prior written consent, which consent will not unreasonably be withheld or delayedCompany). (hj) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising the Units and the Agent’s WarrantsConvertible Notes, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documentsbinders, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. In addition, the Company will shall pay all reasonable filing fees, costs and legal fees for Blue Sky services and related filings and reasonable expenses of its counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions (collectively, the “Blue Sky Expenses”). Additional amounts, if any, for required filing fees shall be paid at any subsequent Closing, as applicable. The Blue Sky filings shall be prepared by the Placement Company’s counsel. Moreover, in addition to the Agent’s counsel for Expenses set forth in Section 3(e), at the Company’s account. Further, as promptly as practicable after the Closing, First Closing the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to reimburse the Placement AgentAgent for all out-of-pocket expenses incurred, including fees and disbursements of its counsel, in the amount of $50,000 (“Legal Expenses”). (k) Until the later of (i) Effective upon the sale of Termination Date and (ii) the Minimum Amount, the Placement Agent shall have a twelve Final Closing (12) month right of first refusal from such date to act as a lead placement agent on any future private placement of the Company’s securities in which the Company seeks to utilize a third party placement agent or as a lead managing underwriter on any public offering of the Company’s securities in which the Company seeks to utilize a third party underwriter. It is understood that if a third party broker- dealer provides the Company with written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”hereinafter defined), the Company shall promptly present same to will not issue any press release, grant any interview, or otherwise communicate with the media in any manner whatsoever without the Placement Agent. The Placement Agent shall have ten (10) business days from its receipt of the Written Offering Terms in ’s prior written consent, which to determine whether consent will not unreasonably be withheld or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) during the remainder of such twelve (12) month perioddelayed. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing of the Offering involving an aggregate of $3 million from PARL Investors.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) Except with prior written notice to the Placement Agent, the Company shall not, at any time prior to the Final Closing, take any action which would cause any of the representations, warranties and covenants made by it in this Agreement not to be complete, accurate and correct in all material respects on and as of each Closing Date with the same force and effect as if such representations, warranties and covenants had been made on and as of each such date. (b) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the reasonable opinion of counsel to the Placement Agent and the CompanyAgent, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent may request. The Company shall not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent shall not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel will have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance in all material respects with the 1933 Act, the regulations thereunder Regulations and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units or the Securities for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its best efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (bc) The Company shall comply with the 1933 Act, the Regulations, the 1934 Act, and the rules and regulations promulgated thereunder, all applicable state securities laws and the rules and regulations thereunder in the states in which the Units are to be offered and in which Blue Sky counsel has advised the Placement Agent that the Units are exempt from qualification or registration requirements, so as to permit the continuance of the sales of the Units, and will use its commercially reasonable efforts to assist counsel file with the SEC, and shall promptly thereafter forward to the Placement Agent in qualifying Agent, any and all reports on Form D as are required. (d) The Company shall use its reasonable best efforts to qualify the Units for sale under the securities laws of such U.S. jurisdictions in the United States as may be mutually agreed to by the Company and the Placement Agent, and the Company will make such applications and furnish information as may be required for such purposes; provided, however, that the Company will shall not be required or obligated to qualify to do business as a foreign corporation in any jurisdiction where it is not now jurisdiction. The Company shall, from time to time, prepare and file such statements and reports as are or may be required to continue such qualifications in effect for so qualified or to take any action which would subject it to service of process in suits, other than those arising out of long a period as the offering or sale of the UnitsPlacement Agent may reasonably request. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided promptly to the Placement Agent. The Company or its counsel will provide counsel for the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company reasonably deem necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units are to be offered or sold. (ce) The Company shall place a legend on the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Shares and the Warrants and Agent’s Warrant Shares, issued to subscribers stating that the securities evidenced thereby have not been registered under the 1933 Act or applicable state securities laws, laws and setting forth or referring to the applicable restrictions on transferability and sale of such securities under the 1933 Act and applicable state laws. (df) The Company shall apply the net proceeds from the sale of the Units to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. working capital requirements and for such other purposes as are specifically described under the “Use of Proceeds” section of the Memorandum. Except as set forth in the Memorandum, the Company shall not use any of the net proceeds of the Offering to repay indebtedness to officers, directors or stockholders of the Company without the prior written consent of the Placement Agent. (eg) During the Offering Period, the Company shall make available for review by prospective Investors subscribers for Units during normal business hours at the Company’s offices, upon their reasonable request, copies of such corporate documents, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, the Company Agreements to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, thereof and shall afford each prospective Investor subscriber for Units the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expenseexpense or effort. (fh) Except with the prior written consent of the Placement Agent, the Company shall not, at any time prior to the earlier of the Final Closing or the Termination Date, (i) engage in or commit to engage in any transaction outside the ordinary course of business as described in the Memorandum, (ii) issue, agree to issue or set aside for issuance any securities (debt or equity) or any rights to acquire any such securities except as contemplated by the Memorandum, (iii) incur, outside the ordinary course of business, any material indebtedness, (iv) dispose of any material assets, (v) make any material acquisition or (vi) change its business or operations. (i) Until completion at the earlier of (ia) completion the effectiveness of the Offering, and Resale Registration Statement or (iib) the Termination Date, neither the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a private or consummation of an underwritten initial public offering of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect Common Stock, the Company shall deliver to the FDF Acquisition as contemplated in Placement Agent and the Memorandum. Except as contemplated in Company’s stockholders: (i) annual unaudited financial statements setting forth fairly the Memorandum, neither financial position of the Company nor anyone acting on its behalf shall, until Company; (ii) quarterly unaudited financial statements including both a balance sheet and statement of income (with year over year quarterly comparisons); and (iii) a quarterly report of the Termination Date, offer for sale to, or solicit offers to subscribe for Units or other securities progress and status of the Company fromand an annual report setting forth clearly the financial position and outlook of the Company; provided, or otherwise approach or negotiate however, that such report need not contain information reasonably deemed confidential by the Company’s Board of Directors. In addition, the Company shall deliver to the Placement Agent such quarterly unaudited financial statements as are prepared for the Company’s Board of Directors and a copy of a list of its stockholders as and when so requested, (only for use in respect thereof with, any other personconnection with the Company) and shall establish and maintain a Company website for the dissemination of general Company information. (g) Until the earlier of (i) the Termination Date and (ii) the Final Closing, neither the Company nor the Placement Agent will issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media in any manner whatsoever without the other party’s prior written consent, which consent will not unreasonably be withheld or delayed. (hj) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising Units, the Units Shares, the Warrants, and the Agent’s Warrants, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. In addition, the Company will shall pay for all reasonable filing fees, costs and legal fees for Blue Sky services Expenses (as defined below) relating to the preparation and related filings and reasonable expenses filing of counsel (up state Blue Sky exemptions that are sought with respect to the Offering. As used herein, the term “Blue Sky Expenses” means solely an amount equal to $7,500 of legal fees), which $5,000 of 750 per state for legal fees, plus an additional amount commensurate with the required state filing fees fees. The amount of the Blue Sky Fees shall be paid on or before to the First Closing with respect to obtaining Blue Sky exemptions (“Blue Sky Expenses”). Additional amounts, if any, for required filing fees shall be paid at any subsequent Placement Agent’s counsel each Closing, as applicable. The Blue Sky filings shall be prepared by the Placement Agent’s counsel for the Company’s account. Further, as promptly as practicable after the Closing, the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to the Placement Agent. (i) Effective upon the sale of the Minimum Amount, the Placement Agent shall have a twelve (12) month right of first refusal from such date to act as a lead placement agent on any future private placement of the Company’s securities in which the Company seeks to utilize a third party placement agent or as a lead managing underwriter on any public offering of the Company’s securities in which the Company seeks to utilize a third party underwriter. It is understood that if a third party broker- dealer provides the Company with written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to the Placement Agent. The Placement Agent shall have ten (10) business days from its receipt of the Written Offering Terms cause such counsel to make such filings on a timely basis in which to determine whether or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) accordance with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) during the remainder of such twelve (12) month periodapplicable law. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing of the Offering involving an aggregate of $3 million from PARL Investors.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) If, at any time prior to the Final Closing (i) Closing, any event shall occur which that does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, representations and warranties and covenants herein remain true, or (ii) in case it shall, in the reasonable opinion of counsel to the Placement Agent and the CompanyAgent, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, will promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, and shall prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent may reasonably request. The Company shall will not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent shall will not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel will have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance in all material respects with the Act, the regulations thereunder Securities Act and other applicable securities laws. As soon as the Company is advised thereof, the Company shall will advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units or the Securities for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall will use its best efforts to prevent the issuance of any such order order, judgment or decree, and, if issued, to obtain as soon as reasonably possible the lifting thereof. (b) The Company shall comply with the Securities Act, the Regulations, the 1934 Act, all applicable state securities laws and the rules and regulations promulgated thereunder in the states in which the Units are to be offered and in which the Company's counsel has advised the Placement Agent that the Units are qualified or registered for sale or exempt from such qualification or registration, so as to permit the continuance of the sales of the Units, and will use its commercially reasonable efforts to assist counsel file with the SEC, and shall promptly thereafter forward to the Placement Agent in qualifying any and all reports on Form D as are required. (c) The Company shall use its reasonable best efforts to qualify the Units for sale (or seek exemption therefrom) under the securities laws of such U.S. jurisdictions in the United States as may be mutually agreed to by the Company and the Placement Agent; provided, that and the Company will not be required or obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the Units. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period (through its counsel) make such applications and shall file all amendments with the SEC furnish information as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement Agentrequired for such purposes. The Company will, from time to time, prepare and file such statements and reports as are or its counsel will provide counsel may be required to continue such qualifications in effect for so long a period as the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company may reasonably deem necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units are to be offered or soldrequest. (cd) The Company shall place a legend on the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Warrants shares of Preferred Stock and Agent’s Warrant Shares, the Conversion Shares issued to subscribers stating that the securities evidenced thereby have not been registered under the Securities Act or applicable state securities laws, laws and setting forth or referring to the applicable restrictions on transferability and sale of such securities under the Securities Act and applicable state laws. (de) The Company shall apply the net proceeds from the sale of the Units to fund the Mergers, its acquisition of Xxxxxxx Drilling Fluids, Ltd. and working capital requirements and/or for such other purposes as are specifically shall be described under “"Use of Proceeds” " in the Memorandum. (ef) During the Offering Period, the Company shall make available for review by prospective Investors purchasers of the Units during normal business hours at the Company’s 's offices, upon their request, copies of such corporate documents, including, but not limited to, organizational materials and any material contracts, as such Investor shall reasonably requestagreement to which the Company is a party, to the extent that such disclosure shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, thereof and shall afford each prospective Investor purchaser of Units the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expense. (fg) For a period ending on the earlier of the Expiration Date (if applicable) and an IPO, the Company shall deliver (i) to the Placement Agent and the Company's stockholders annual audited financial statements prepared in accordance with GAAP setting forth fairly the financial position of the Company, (ii) to the Placement Agent quarterly unaudited financial statements including a balance sheet, cash flow statement and statement of income, prepared in accordance with GAAP, (iii) to the Company's stockholders, quarterly and annual reports, reviewed by the Placement Agent, of the progress and status of the Company and setting forth clearly the financial position of the Company, (iv) to the Placement Agent a copy of a list of its stockholders as and when so requested, and (v) to the Placement Agent such additional information and documents concerning the business and financial condition and outlook of the Company as the Placement Agent may from time to time reasonably request. (h) Whether or not the transactions contemplated hereby are consummated, or this Agreement is terminated, the Company hereby agrees to pay all fees, costs and expenses incident hereto and to the Offering, including, without limitation, those in connection with (i) preparing, printing, duplicating, filing, distributing and binding the Memorandum and any and all amendments and/or supplements thereto and any and all agreements, contracts and other documents related hereto and thereto, and the cost of bound volumes of closing documents; (ii) the creation, authorization, issuance, transfer and delivery of the Preferred Stock, the Conversion Shares, the Agent's Shares and the Agent's Warrants, including, without limitation, fees and expenses of any transfer agent or registrar; (iii) the fees and expenses of the Escrow Agent; (iv) all fees and expenses of legal, accounting and other advisers to the Company; and (v) all filing fees, costs and legal fees and expenses for Blue Sky services and related filings with respect to Blue Sky exemptions and qualifications. (i) Until the earlier of (i) completion later of the Offering, Final Closing Date and (ii) the Termination Date, neither the Company nor any person or entity acting on its behalf shall will negotiate or enter into any agreement with any other placement agent or underwriter with respect to a private or public offering of the Company’s 's or any subsidiary's debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition as contemplated in the Memorandum. Except as contemplated in the Memorandum, neither the Company nor anyone acting on its behalf shall, until the Termination Date, offer for sale to, or solicit offers to subscribe for Units or other securities of the Company from, or otherwise approach or negotiate in respect thereof with, any other person. (g) Until the earlier of (i) the Termination Date and (ii) the Final Closing, neither the Company nor the Placement Agent will issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media in any manner whatsoever without the other party’s prior written consent, which consent will not unreasonably be withheld or delayed. (h) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising the Units and the Agent’s Warrants, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. In addition, the Company will pay all reasonable filing fees, costs and legal fees for Blue Sky services and related filings and reasonable expenses of counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions (“Blue Sky Expenses”). Additional amounts, if any, for required filing fees shall be paid at any subsequent Closing, as applicable. The Blue Sky filings shall be prepared by the Placement Agent’s counsel for the Company’s account. Further, as promptly as practicable after the Closing, the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to the Placement Agent. (i) Effective upon the sale of the Minimum Amount, the Placement Agent shall have a twelve (12) month right of first refusal from such date to act as a lead placement agent on any future private placement of the Company’s securities in which the Company seeks to utilize a third party placement agent or as a lead managing underwriter on any public offering of the Company’s securities in which the Company seeks to utilize a third party underwriter. It is understood that if a third party broker- dealer provides the Company with written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to the Placement Agent. The Placement Agent shall have ten (10) business days from its receipt of the Written Offering Terms in which to determine whether or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) during the remainder of such twelve (12) month periodsecurities. (j) Effective upon The Company shall disclose all material agreements to which it is bound, or by which its assets are or will be subject, as of the sale date of at least $3 million the Memorandum in a disclosure schedule which shall be delivered to investors on the Placement Agent Referral List on or before the date of the Memorandum. (k) The Company shall provide Special Counsel such full and complete access to information, documents and management, as Special Counsel reasonably believes is necessary to prepare the “PARL Investors”)10b-5 opinion, the Placement Agent shall have the right to nominate one including, without limitation access to: (1i) person to serve on the Board of Directors conferences with representatives of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing , and representatives of the Offering involving an aggregate Placement Agent, at which contents of $3 million from PARL Investorsthe Memorandum and related matters will be discussed and (ii) documents relating to the preparation of the 10b-5 opinion.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum Disclosure Materials so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the opinion of counsel to the Placement Agent and the Company, be necessary to amend or supplement the Memorandum Disclosure Materials to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum Disclosure Materials in such quantities as the Placement Agent may request. The Company shall not at any time, whether before or after the Final Closing, time prepare or use any amendment or supplement to the Memorandum Disclosure Materials of which the Placement Agent shall not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel will have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance with the Securities Act, the regulations thereunder and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the MemorandumDisclosure Materials, or the suspension of the qualification or registration of the Units or the Securities securities for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities securities for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its best commercially reasonable efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (b) The Company will use its commercially reasonable efforts to assist counsel to permit the Placement Agent in qualifying the Units for sale of securities without registration under the securities laws of such U.S. jurisdictions as may be mutually agreed to by the Company and the Placement Agent; provided, that the Company will not be required or obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the Unitssecurities. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement Agent. The Company or its counsel will provide counsel for the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units securities are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company reasonably deem deems necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units securities are to be offered or sold. (c) The Company shall place a legend on the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Warrants and Agent’s Warrant Shares, stating that the securities evidenced thereby have not been registered under the Securities Act or applicable state securities laws, setting forth or referring to the applicable restrictions on transferability and sale of such securities under the Securities Act and applicable state laws. (d) The Company shall apply the net proceeds from the sale of the Units to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. and for such other purposes as are specifically described under “Use of Proceeds” in the Memorandum. (e) During the Offering PeriodOffering, the Company shall make available for review by prospective Investors investors during normal business hours at the Company’s offices, upon their request, copies of such corporate documentsdocuments relating to the Company, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, and shall afford each prospective Investor the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum Disclosure Materials to the extent it possesses such information or can acquire it without unreasonable expense. (fe) Until the earlier of (i) completion Final Closing of the Offering, and (ii) the Termination Date, neither the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a private or public offering of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition as contemplated in the Memorandumits securities. Except as contemplated in the Memorandum, neither Neither the Company nor anyone acting on its behalf shall, until the earlier of (i) Final Closing of the Offering, and (ii) the Termination Date, offer for sale to, or solicit offers to subscribe for Units or other securities of the Company from, or otherwise approach or negotiate in respect thereof with, any other personperson other than Excluded Investors. (gf) Until the earlier of (i) the Termination Date Final Closing of the Offering, and (ii) the Final ClosingTermination Date, neither the Company nor the Placement Agent will not issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media (“Public Communication”) in any manner whatsoever without prior notice to the other party’s prior written consent, which consent will not unreasonably be withheld or delayedAgent. (hg) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising the Units and the Agent’s Warrants, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum Disclosure Materials and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. In addition, the Company will shall pay all filing fees and reasonable filing fees, costs and legal fees and expenses for Blue Sky services and related filings and reasonable out-of-pocket expenses of counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions that are sought with respect to the Offering (the “Blue Sky Expenses”). Additional amounts, if any, for required filing fees shall be paid at any subsequent Closing, as applicable. The Blue Sky filings shall be prepared by the Placement Agent’s counsel for the Company’s account. Further, as promptly as practicable after the Closing, the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to the Placement Agent. (i) Effective upon the sale of the Minimum Amount, the Placement Agent shall have a twelve (12) month right of first refusal from such date to act as a lead placement agent on any future private placement of the Company’s securities in which the Company seeks to utilize a third party placement agent or as a lead managing underwriter on any public offering of the Company’s securities in which the Company seeks to utilize a third party underwriter. It is understood that if a third party broker- dealer provides the Company with written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to the Placement Agent. The Placement Agent shall have ten (10) business days from its receipt of the Written Offering Terms in which to determine whether or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) during the remainder of such twelve (12) month period. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing of the Offering involving an aggregate of $3 million from PARL Investors.

Further Covenants of the Company. The Company hereby covenants and agrees that: (a) Except with the prior written consent of the Placement Agent, the Company shall not, at any time prior to the Final Closing, take any action which would cause any of the representations, warranties and covenants made by it in this Agreement not to be complete, accurate and correct on and as of each Closing Date with the same force and effect as if such representations, warranties and covenants had been made on and as of each such date. (b) If, at any time prior to the Final Closing (i) any event shall occur which does or may materially affect the Company or as a result of which it might become necessary to amend or supplement the Memorandum so that the representations, warranties and covenants herein remain true, or (ii) in case it shall, in the reasonable opinion of counsel to the Placement Agent and the CompanyAgent, be necessary to amend or supplement the Memorandum to comply with Regulation D or any other applicable securities laws or regulations, the Company shall, in the case of (i) above, promptly notify the Placement Agent and, in the event of either (i) or (ii) above shall, at its sole cost, prepare and furnish to the Placement Agent copies of appropriate amendments and/or supplements to the Memorandum in such quantities as the Placement Agent may request. The Company shall not at any time, whether before or after the Final Closing, prepare or use any amendment or supplement to the Memorandum of which the Placement Agent shall not previously have been advised and furnished with a copy, or to which the Placement Agent or its counsel will have reasonably objected in writing or orally (confirmed in writing within 24 hours), or which is not in compliance in all material respects with the Securities Act, the regulations thereunder Regulations and other applicable securities laws. As soon as the Company is advised thereof, the Company shall advise the Placement Agent and its counsel, and confirm the advice in writing, of any order preventing or suspending the use of the Memorandum, or the suspension of the qualification or registration of the Units or the Securities Shares for offering or the suspension of any exemption for such qualification or registration of the Units or the Securities Shares for offering in any jurisdiction, or of the institution or threatened institution of any proceedings for any of such purposes, and the Company shall use its best efforts to prevent the issuance of any such order and, if issued, to obtain as soon as reasonably possible the lifting thereof. (bc) The Company shall comply with the Securities Act, the Regulations, the Exchange Act, and the rules and regulations promulgated thereunder, all applicable state securities laws and the rules and regulations thereunder in the states in which the Shares are to be offered and in which Blue Sky counsel has advised the Placement Agent that the Shares are exempt from qualification or registration requirements, so as to permit the continuance of the sales of the Shares, and will use its commercially reasonable efforts to assist counsel file with the SEC, and shall promptly thereafter forward to the Placement Agent in qualifying Agent, any and all reports on Form D as are required. (d) The Company shall use its best efforts to qualify the Units Shares for sale under the securities laws of such U.S. jurisdictions in the United States as may be mutually agreed to by the Company and the Placement Agent; provided, and the Company shall make such applications and furnish information as may be required for such purposes, provided that the Company will shall not be required or obligated to qualify to do business as a foreign corporation in any jurisdiction where it is not now so qualified or to take any action which would subject it to service of process in suits, other than those arising out of the offering or sale of the Units. Furthermore, the Company shall file a copy of a Notice of Sale on Form D with the SEC within the prescribed time period and shall file all amendments with the SEC as may be required. Copies of the Form D and all amendments thereto shall be provided to the Placement Agentjurisdiction. The Company shall, from time to time, prepare and file such statements and reports as are or its counsel will provide counsel may be required to continue such qualifications in effect for so long a period as the Placement Agent with copies of all correspondence or other documentation filed with or received from any jurisdiction where the Units are to be registered or qualified or offered. The Company will promptly provide to the Placement Agent for delivery to all offerees and investors and their representatives any additional information, documents and instruments which the Placement Agent or the Company may reasonably deem necessary to comply with the rules, regulations and judicial and administrative interpretations respecting compliance with such exemptions or qualifications and registrations in those states where the Units are to be offered or soldrequest. (ce) The Company shall place a legend on the certificates representing the Shares, Warrants, Warrant Shares, Agent’s Warrants and Agent’s Warrant Shares, Shares issued to Investors stating that the securities evidenced thereby have not been registered under the Securities Act or applicable state securities lawslaws and cannot be sold or otherwise transferred without an effective registration or an exemption therefrom, setting forth or referring and may not be sold pursuant to the applicable restrictions on transferability and sale exemptions provided by Section 4(1) of such securities the Securities Act or Rule 144 under the Act Securities Act, in accordance with the letter from Xxxxxxx X. Xxxxx, Chief of the Office of Small Business Policy of the Securities and applicable state lawsExchange Commission’s Division of Corporation Finance, to Xxx Worm of NASD Regulation, Inc., dated January 21, 2000. (df) The Company shall apply the net proceeds from the sale of the Units Shares to fund its acquisition of Xxxxxxx Drilling Fluids, Ltd. working capital requirements and for such other purposes as are specifically described under the “Use of Proceeds” section of the Memorandum. Except as set forth in the Memorandum, the Company shall not use any of the net proceeds of the Offering to repay indebtedness to officers, directors or stockholders of the Company without the prior written consent of the Placement Agent. (eg) During the Offering Period, the Company shall make available for review by prospective Investors purchasers of the Shares during normal business hours at the Company’s offices, upon their request, copies of such corporate documents, including, but not limited to, organizational materials and material contracts, as such Investor shall reasonably request, all Company agreements to the extent that such shall not violate any obligation on the part of the Company to maintain the confidentiality thereof, thereof and shall afford each prospective Investor purchaser of Shares the opportunity to ask questions of and receive answers from an officer of the Company concerning the terms and conditions of the Offering and the opportunity to obtain such other additional information necessary to verify the accuracy of the Memorandum to the extent it possesses such information or can acquire it without unreasonable expenseexpense or effort. (fh) Until Except with the earlier of (i) completion prior written consent of the OfferingPlacement Agent, and (ii) the Company shall not, at any time prior to the later of the Final Closing or the Termination Date, neither (i) engage in or commit to engage in any transaction outside the Company nor any person or entity acting on its behalf shall negotiate with any other placement agent or underwriter with respect to a private or public offering ordinary course of the Company’s debt or equity securities except for debt financing facilities that are necessary with respect to the FDF Acquisition business as contemplated in the Memorandum. Except as contemplated described in the Memorandum, neither (ii) issue, agree to issue or set aside for issuance any securities (debt or equity) or any rights to acquire any such securities except as contemplated by the Company nor anyone acting on its behalf shallMemorandum, until (iii) incur, outside the Termination Date, offer for sale to, or solicit offers to subscribe for Units or other securities ordinary course of the Company from, or otherwise approach or negotiate in respect thereof withbusiness, any other personmaterial indebtedness, (iv) dispose of any material assets, (v) make any material acquisition or (vi) change its business or operations. (g) Until the earlier of (i) the Termination Date and (ii) the Final Closing, neither the Company nor the Placement Agent will issue any press release, grant any media interview (including without limitation, internet media outlets), or otherwise communicate with the media in any manner whatsoever without the other party’s prior written consent, which consent will not unreasonably be withheld or delayed. (h) The Company shall pay all expenses incurred in connection with the preparation and printing of all necessary offering documents, amendments, and instruments related to the Offering and the issuance of the securities comprising the Units and the Agent’s WarrantsShares, and shall also pay its own expenses for accounting fees, legal fees, bound volumes of closing documents, and other costs involved with the Offering. The Company shall provide at its own expense such quantities of the Memorandum and other documents and instruments relating to the Offering as the Placement Agent may reasonably request. In addition, the Company will shall pay all reasonable filing fees, costs and legal fees for Blue Sky services and related filings and reasonable expenses of the Placement Agent’s counsel (up to $7,500 of legal fees), which $5,000 of legal fees, plus an additional amount commensurate with the required filing fees shall be paid on or before the First Closing with respect to obtaining Blue Sky exemptions (collectively, the “Blue Sky Expenses”). Additional , $500 per state, which shall be paid to the Company’s counsel upon execution of this Agreement for legal fees in connection with obtaining Blue Sky exemptions, and additional amounts, if any, for required filing fees of which shall be paid at any subsequent each Closing, as applicable. The Blue Sky filings shall be prepared by the Placement AgentCompany’s counsel for the Company’s account. Further, as promptly as practicable after the Closing, the Company shall prepare, at its own expense, “velobound closing binders” relating to the Offering and will distribute such binders to the individuals designated by counsel to the Placement Agent. (ij) Effective upon Until the sale later of the Minimum AmountFinal Closing or the Termination Date, the Placement Agent shall have a twelve (12) month right of first refusal from such date to act as a lead placement agent on any future private placement of the Company’s securities in which neither the Company seeks to utilize a third party nor any person or entity acting on its behalf shall negotiate with any other placement agent or as underwriter with respect to a lead managing underwriter on any private or public offering of the Company’s securities in which or any affiliate’s debt or equity securities. Neither the Company seeks nor anyone acting on its behalf shall, until the later of the Final Closing or the Termination Date, offer for sale to, or solicit offers to utilize a third party underwriter. It is understood that if a third party broker- dealer provides subscribe for Shares or other securities of the Company with from, or otherwise approach or negotiate in respect thereof with, any other person, without the prior written terms with respect to a future securities offering that the Company wishes to accept during such twelve month period (“Written Offering Terms”), the Company shall promptly present same to consent of the Placement Agent. The Placement Agent shall have ten (10) business days from its receipt of the Written Offering Terms in which to determine whether or not to accept such offer and, if the Placement Agent refuses, and provided that such financing is consummated (a) with another placement agent or underwriter upon substantially the same terms and conditions as the Written Offering Terms and (b) within three months after the end of the aforesaid ten (10) business day period, this right of first refusal shall thereafter be forfeited and terminated; provided, however, if the financing is not consummated under the conditions of clauses (a) and (b) above, then the right of first refusal shall once again be reinstated under the same terms and conditions set forth in this Section 6(h) during the remainder of such twelve (12) month period. (j) Effective upon the sale of at least $3 million to investors on the Placement Agent Referral List (the “PARL Investors”), the Placement Agent shall have the right to nominate one (1) person to serve on the Board of Directors of the Company. The Company shall use its best efforts to cause the Board of Directors to take necessary action to facilitate this appointment at the time of a closing of the Offering involving an aggregate of $3 million from PARL Investors.