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EXHIBIT 4.2
AGREEMENT
BETWEEN NEWPARK RESOURCES, INC.
AND XXXXXXXX INTERNATIONAL LIMITED
DATED AS OF MAY 30, 2000
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INDEX OF DEFINED TERMS
PAGE
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65 Day Notice ...................................................................................... 14
Acquirer ........................................................................................... 19
Agreement .......................................................................................... 1
Auditor Report ..................................................................................... 7
Average Price ...................................................................................... 13
Benefit Plans ...................................................................................... 5
Blackout Period .................................................................................... 9
Blackout Violation ................................................................................. 10
Certificate of Rights and Preferences .............................................................. 1
claim .............................................................................................. 6
Closing ............................................................................................ 1
Closing Date ....................................................................................... 1
Combination ........................................................................................ 20
Common Shares ...................................................................................... 1
Common Stock ....................................................................................... 1
Covered Security ................................................................................... 8
debt ............................................................................................... 6
Excess Notice Date ................................................................................. 14
Excess Rights ...................................................................................... 13
Excess Rights Notice ............................................................................... 13
Exchange Act ....................................................................................... 2
Exercisable Number ................................................................................. 14
First Refusal Stockholders ......................................................................... 16
Xxxxxxxx ........................................................................................... 1
Xxxxxxxx Indemnified Party ......................................................................... 22
Increase ........................................................................................... 14
Increase Notice .................................................................................... 14
Indemnification Amount ............................................................................. 10
Indemnified Party .................................................................................. 24
Indemnifying Party ................................................................................. 24
Investment Securities .............................................................................. 1
Issuance Blockage .................................................................................. 12
Maximum Number ..................................................................................... 14
Newpark ............................................................................................ 1
Newpark Indemnified Party .......................................................................... 23
Notice Period ...................................................................................... 14
NYSE ............................................................................................... 2
Offer Notice ....................................................................................... 16
Offered Shares ..................................................................................... 16
Original Number .................................................................................... 12
Preferred Shares ................................................................................... 1
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Preferred Stock .................................................................................... 5
Preferred Stock Conversion Delivery Notice ......................................................... 12
Preferred Stock Conversion Notice .................................................................. 12
Proceeding ......................................................................................... 22
Prospectus ......................................................................................... 8
Registrable Number ................................................................................. 7
Registration Requirement ........................................................................... 7
Registration Statement ............................................................................. 8
Related Proceeding ................................................................................. 27
Required Consent ................................................................................... 12
Required Registration Date ......................................................................... 7
Rule 144 ........................................................................................... 8
Sales Contract ..................................................................................... 10
SEC ................................................................................................ 5
SEC Filing ......................................................................................... 5
Securities Act ..................................................................................... 5
Series B Preferred Stock ........................................................................... 1
Trading Day ........................................................................................ 1
Trigger Date ....................................................................................... 12
Warrant ............................................................................................ 1
Warrant Exercise Delivery Notice ................................................................... 12
Warrant Exercise Notice ............................................................................ 12
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TABLE OF CONTENTS
PAGE
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1. Purchase and Sale...............................................................................1
2. Closing.........................................................................................2
3. Representations and Warranties of Newpark.......................................................2
4. Registration Provisions.........................................................................7
5. "Market Stand-Off" Agreement...................................................................11
6. Conversion of Preferred Shares; Exercise of Warrant............................................11
7. Representations and Warranties of Xxxxxxxx.....................................................14
8. Right of First Refusal.........................................................................15
9. Covenants of Newpark...........................................................................17
10. Consolidation, Merger, Etc.....................................................................19
11. Covenants of Xxxxxxxx..........................................................................19
12. Legend.........................................................................................19
13. Conditions Precedent to Xxxxxxxx'x Obligations.................................................20
14. Conditions Precedent to Newpark's Obligations..................................................21
15. Fees and Expenses..............................................................................21
16. Non-Performance................................................................................21
17. Indemnification................................................................................21
18. Survival of the Representations, Warranties, etc...............................................24
19. Notices........................................................................................24
20. Miscellaneous..................................................................................26
21. Newpark's Obligations..........................................................................28
22. Time of Essence................................................................................28
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FORM OF CERTIFICATE OF RIGHTS AND PREFERENCES OF
CLASS B CONVERTIBLE PREFERRED STOCK OF
NEWPARK RESOURCES, INC.................................................................................A-1
FORM OF WARRANT CERTIFICATE............................................................................B-1
FORM OF DELIVERY NOTICE ...............................................................................C-1
AUDITOR REPORT.........................................................................................D-1
FORM OF PREFERRED STOCK CONVERSION NOTICE..............................................................E-1
FORM OF PREFERRED STOCK CONVERSION DELIVERY NOTICE.....................................................F-1
FORM OF EXCESS RIGHTS NOTICE...........................................................................G-1
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EXECUTION COPY
AGREEMENT
This Agreement (this "Agreement") dated as of May 30, 2000 is
entered into by and between Newpark Resources, Inc., a corporation organized
under the laws of Delaware (together with its successors, "Newpark"), and
Xxxxxxxx International Limited, a company organized under the laws of the Cayman
Islands (together with its successors, "Xxxxxxxx").
The parties hereto agree as follows:
1. Purchase and Sale. In consideration of and upon the basis
of the representations, warranties and agreements and subject to the terms and
conditions set forth in this Agreement:
x. Xxxxxxxx agrees to purchase from Newpark, and
Newpark agrees to sell to Xxxxxxxx on the Closing Date (as defined
below), in accordance with Section 2 below, 120,000 shares (the
"Preferred Shares") of Newpark's Series B Convertible Preferred Stock,
liquidation preference $250 per share (the "Series B Preferred Stock"),
having the terms and conditions set forth in the Certificate of Rights
and Preferences attached hereto as Annex A (the "Certificate of Rights
and Preferences"), at an aggregate purchase price of $30,000,000. In
addition, Newpark shall issue to Xxxxxxxx on the Closing Date one
warrant substantially in the form attached hereto as Annex B (a
"Warrant") to purchase from time to time up to an aggregate of
1,900,000 shares (subject to the adjustments contained in the Warrant
and this Agreement) of Newpark common stock, par value $0.01 per share
(the "Common Stock") at a per share purchase price equal to $10.075.
Xxxxxxxx shall have the right to convert the outstanding Preferred
Shares, and to exercise the Warrant, into shares of Common Stock in the
manner, and subject to the terms, specified in this Agreement and in
the Certificate of Rights and Preferences and the Warrant,
respectively.
b. The closing (the "Closing") of the sale of the
Preferred Shares shall occur on the Trading Day following the
satisfaction or, if applicable, waiver of the conditions set forth in
Sections 13 and 14 hereof, or at such other date and time as Xxxxxxxx
and Newpark shall mutually agree (such date, the "Closing Date"). As
used herein, the term "Common Shares" means the shares of Common Stock
issued and/or issuable under this Agreement, including shares issuable
upon conversion of or as dividends under the Preferred Shares, upon
exercise of the Warrant and all other shares issuable under the
Certificate of Rights and Preferences, the Warrant or this Agreement;
the term "Investment Securities" means the Warrant and Preferred Shares
issued hereunder, and all Common Shares; the term "Trading Day" means
any day on which the Common Stock may be traded on the NYSE; and the
term "NYSE" means the New York Stock Exchange, but if the New York
Stock Exchange is not then the principal U.S.
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trading market for the Common Stock, then "NYSE" shall be deemed to
mean the principal U.S. national securities exchange (as defined in the
Securities Exchange Act of 1934, as amended ("the Exchange Act")) on
which the Common Stock is then traded, or if such Common Stock is not
then listed or admitted to trading on any national securities exchange
but is designated as a national market system security or a Nasdaq
SmallCap Market Security by the NASD, then such market system, or if
such Common Stock is not listed or quoted on any of the foregoing, then
the OTC Bulletin Board.
2. Closing. The Closing shall take place initially via
facsimile on the Closing Date in the manner set forth below; provided that
original certificates representing shares of Series B Preferred Stock and
Warrant shall be delivered via Federal Express on the second Trading Day
following the Closing Date to Xxxxxxxx as Xxxxxxxx instructs in writing, and
provided, further, that each original preferred stock certificate issued in
accordance with this Section 2 shall represent 20,000 shares of Series B
Preferred Stock (except that to the extent the number of shares of Series B
Preferred Stock to be delivered at any given time is not evenly divisible by
20,000, one stock certificate shall represent the remaining shares). At the
Closing, the following deliveries shall be made:
a. Series B Preferred Stock and Warrant. Newpark
shall deliver to Xxxxxxxx six (6) stock certificates, each representing
20,000 shares of Series B Preferred Stock, together with one Warrant
duly executed by Newpark in definitive form, in each case duly
registered on the books of Newpark as instructed by Xxxxxxxx.
b. Purchase Price. Xxxxxxxx shall cause to be wire
transferred to Newpark, in accordance with the instructions set forth
in Section 19, the aggregate purchase price of $30,000,000 in
immediately available United States dollars.
c. Closing Documents. The closing documents required
by Sections 13 and 14 shall be delivered to Xxxxxxxx and Newpark,
respectively.
d. Delivery Notice. An executed copy of the delivery
notice in the form attached hereto as Annex C shall be delivered to
Xxxxxxxx.
The deliveries specified in this Section 2 shall be deemed to occur
simultaneously as part of a single transaction, and no delivery shall be deemed
to have been made until all such deliveries have been made.
3. Representations and Warranties of Newpark. Newpark hereby
represents and warrants to Xxxxxxxx on the Closing Date, as follows:
a. Newpark has been duly incorporated and is validly
existing in good standing under the laws of Delaware or, after the
Closing Date, if another entity has
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succeeded Newpark in accordance with the terms hereof, under the laws
of one of the states of the United States.
b. The execution, delivery and performance of this
Agreement and the Certificate of Rights and Preferences and the Warrant
by Newpark (including the issuance of the Investment Securities) have
been duly authorized by all requisite corporate action and no further
consent or authorization of Newpark, its Board of Directors or its
shareholders is required, except as otherwise contemplated by this
Agreement.
c. This Agreement has been duly executed and
delivered by Newpark and, when this Agreement is duly authorized,
executed and delivered by Xxxxxxxx, will be a valid and binding
agreement enforceable against Newpark in accordance with its terms,
subject to bankruptcy, insolvency, reorganization, moratorium and
similar laws of general applicability relating to or affecting
creditors' rights generally and to general principles of equity.
d. Newpark has full corporate power and authority
necessary to execute and deliver this Agreement and to perform its
obligations hereunder and under the Certificate of Rights and
Preferences and the Warrant (including the issuance of the Investment
Securities).
e. No consent, approval, authorization or order of
any court, governmental agency or other body is required for execution
and delivery by Newpark of this Agreement or the performance by Newpark
of any of its obligations hereunder and under the Certificate of Rights
and Preferences and the Warrant other than such as may already have
been received, except as otherwise contemplated by this Agreement.
f. Neither the execution and delivery by Newpark of
this Agreement nor the performance by Newpark of any of its obligations
hereunder and under the Certificate of Rights and Preferences and the
Warrant:
(i) violates, conflicts with, results in a
breach of, or constitutes a default (or an event which with
the giving of notice or the lapse of time or both would be
reasonably likely to constitute a default) under (A) the
certificates of incorporation or by-laws of Newpark or any of
its subsidiaries, (B) any decree, judgment, order, law,
treaty, rule, regulation or determination of which Newpark is
aware (or would be aware after due inquiry) of any court,
governmental agency or body, or arbitrator having jurisdiction
over Newpark or any of its subsidiaries or any of their
respective properties or assets, (C) the terms of any bond,
debenture, note or any other evidence of indebtedness, or any
agreement, stock option or other similar plan, indenture,
lease, mortgage, deed of trust or other instrument to which
Newpark or any of its subsidiaries is a party, by which
Newpark or any of its subsidiaries is bound, or to which any
of the properties or
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assets of Newpark or any of its subsidiaries is subject, (D)
the terms of any "lock-up" or similar provision of any
underwriting or similar agreement to which Newpark or any of
its subsidiaries is a party or (E) any rule or regulation of
the National Association of Securities Dealers, Inc. or the
NYSE (subject to obtaining the Required Consents under
circumstances contemplated by Section 6(c) of this Agreement)
or any rule or regulation of the markets where Newpark's
securities are publicly traded applicable to Newpark or the
transactions contemplated here by; or
(ii) results in the creation or imposition
of any lien, charge or encumbrance upon any Investment
Securities or upon any of the properties or assets of Newpark
or any of its subsidiaries.
g. Newpark has validly reserved for issuance to
Xxxxxxxx 120,000 shares of Series B Preferred Stock pursuant to this
Agreement and 8,000,000 shares of Common Stock (or such greater number
as may be required by Section 9(h)) for issuance upon conversion of the
Preferred Shares and exercise of the Warrant. When issued to Xxxxxxxx
against payment therefor, each Investment Security:
(1) will have been duly and validly
authorized, duly and validly issued, fully paid and
non-assessable;
(2) will be free and clear of any security
interests, liens, claims or other encumbrances (other
than security interests, liens, claims or other
encumbrances created solely by Xxxxxxxx); and
(3) will not have been issued or sold in
violation of any preemptive or other similar rights
of the holders of any securities of Newpark.
h. Newpark satisfies all maintenance criteria of the
New York Stock Exchange or, after the Closing Date, has a valid
exemption from such criteria of which it has previously notified
Xxxxxxxx in writing. No present set of facts or circumstances will
(with the passage of time or the giving of notice or both or neither)
cause any of the Common Stock to be delisted from the New York Stock
Exchange. All of the Covered Securities (as defined in Section 4.b)
will, when issued, be duly listed and admitted for trading on all of
the markets where shares of Common Stock are traded, including the New
York Stock Exchange.
i. There is no pending or, to the best knowledge of
Newpark, threatened action, suit, proceeding or investigation before
any court, governmental agency or body, or arbitrator having
jurisdiction over Newpark or any of its affiliates that would affect
the execution by Newpark of, or the performance by Newpark of its
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obligations under, this Agreement, the Certificate of Rights and
Preferences or the Warrant.
j. Since December 31, 1997, none of Newpark's filings
with the United States Securities and Exchange Commission (the "SEC")
under the Securities Act of 1933, as amended (the "Securities Act") or
under Section 13(a) or 15(d) of the Exchange Act (each an "SEC Filing")
contained any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements, in the
light of the circumstances under which they were made, not misleading.
Since the date of Newpark's most recent SEC Filing, there has not been,
and Newpark is not aware of, any development that is reasonably likely
to result in any material adverse change in the condition, financial or
otherwise, or in the business affairs or prospects of Newpark, whether
or not arising in the ordinary course of business.
k. The offer and sale of the Investment Securities to
Xxxxxxxx pursuant to this Agreement will, subject to compliance by
Xxxxxxxx with the applicable representations and warranties contained
in Section 7 hereof and with the applicable covenants and agreements
contained in Section 11 hereof, be made in accordance with the
provisions and requirements of Securities Act Section 4(2) or
Regulation D promulgated under the Securities Act and any applicable
state law.
l. As of the date hereof, the authorized capital
stock of Newpark consists of 100,000,000 shares of Common Stock and
1,000,000 shares of preferred stock, par value $0.01 ("Preferred
Stock"). As of May 25, 2000, (A) 69,159,752 shares of Common Stock and
150,000 shares of Preferred Stock were issued and outstanding, (B)
8,247,056 shares of Common Stock and no shares of Preferred Stock are
currently reserved and subject to issuance upon the exercise of
outstanding stock options, warrants or other convertible rights, (C)
668 shares of Common Stock are held in the treasury of Newpark, (D) up
to 4,101,952 additional shares of Common Stock may be issued under the
1993 Non-Employee Directors' Stock Option Plan, the Amended and
Restated Newpark Resources, Inc. 1995 Incentive Stock Option Plan, the
Newpark Resources, Inc. Cash and Stock Incentive Plan and the 1999
Employee Stock Purchase Plan (collectively, the "Benefit Plans") and
(E) 228,637 shares of Common Stock reserved for issuance as dividends
on the Series A Cumulative Perpetual Preferred Stock and a presently
indeterminate number of shares issuable upon conversion of the
currently outstanding Series A Cumulative Perpetual Preferred Stock.
All of the outstanding shares of Common Stock are, and all shares of
capital stock which may be issued pursuant to stock options, warrants
or other convertible rights will be, when issued and paid for in
accordance with the respective terms thereof, duly authorized, validly
issued, fully paid and non-assessable and free of any preemptive rights
in respect thereof. As of the date hereof, except as set forth above,
and except for shares of Common Stock or other securities issued upon
conversion, exchange, exercise or purchase associated with the
securities, options, warrants, rights and other instruments referenced
above, no shares of capital stock or other voting securities of Newpark
were outstanding, no equity equivalents,
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interests in the ownership or earnings of Newpark or other similar
rights were outstanding, and there were no existing options, warrants,
calls, subscriptions or other rights or agreements or commitments
relating to the capital stock of Newpark or any of its subsidiaries or
obligating Newpark or any of its subsidiaries to issue, transfer, sell
or redeem any shares of capital stock, or other equity interest in,
Newpark or any of its subsidiaries or obligating Newpark or any of its
subsidiaries to grant, extend or enter into any such option, warrant,
call, subscription or other right, agreement or commitment. Attached
hereto as Schedule 3(l) is a true and correct list as of the date of
this Agreement of all outstanding options, warrants, calls,
subscriptions and other rights or agreements or commitments relating to
the issuance of additional shares of capital stock of Newpark and with
respect to each a description of the number and class of securities and
the exercise price thereof; provided that with respect to Benefit
Plans, such schedule may summarize the total number of shares subject
to, the range of exercise prices under and the average exercise prices
of such options, warrants, calls, or other rights issued under the
Benefit Plans.
m. Solvency. The sum of the assets of Newpark, both
at a fair valuation and at present fair salable value, exceeds its
liabilities, including contingent liabilities, Newpark has sufficient
capital with which to conduct its business as presently conducted and
as proposed to be conducted and Newpark has not incurred debts, and
does not intend to incur debts, beyond its ability to pay such debts as
they mature. For purposes of this paragraph, "debt" means any liability
on a claim, and "claim" means (x) a right to payment, whether or not
such right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured, or unsecured, or (y) a right to an equitable remedy for breach
of performance if such breach gives rise to a payment, whether or not
such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured, unmatured, disputed, undisputed, secured, or
unsecured. With respect to any such contingent liabilities, such
liabilities are computed at the amount which, in light of all the facts
and circumstances existing at the time, represents the amount which can
reasonably be expected to become an actual or matured liability.
n. Audited Financials. Attached hereto as Annex D is
a true, correct and complete copy of (i) the report of Deloitte &
Touche LLP to the board of directors and shareholders of Newpark dated
March 26, 1999 (March 27, 2000 as to Note D thereto), together with the
accompanying consolidated financial statements and schedules of Newpark
at December 31, 1998 and the results of Newpark's operations and cash
flows for each of the two (2) years in the period ended December 31,
1998 (ii) the report of Xxxxxx Xxxxxxxx LLP dated March 27, 2000,
together with the accompanying consolidated financial statements and
schedules of Newpark at December 31, 1999 and the results of Newpark's
operations and cash flows for the year ended December 31, 1999, as such
report appears in the Annual Report on Form 10-K for the fiscal year
ended December 31, 1999 filed by Newpark with the SEC (the "Auditor
Report") and
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(iii) the written consent of Xxxxxx Xxxxxxxx LLP to the inclusion of
its report described in clause (ii) herein.
o. Equivalent Value. As of the date hereof, the
consideration that Newpark is receiving from Xxxxxxxx is equivalent in
value to the consideration Xxxxxxxx is receiving from Newpark pursuant
to this Agreement. As of the date hereof, under the terms of this
Agreement, Newpark is receiving fair consideration from Xxxxxxxx for
the agreements, covenants, representations and warranties made by
Newpark to Xxxxxxxx.
p. No Non-Public Information. Xxxxxxxx has not
requested from Newpark, and Newpark has not furnished to Xxxxxxxx, any
material non-public information concerning Newpark or its subsidiaries.
4. Registration Provisions.
a. Newpark shall as soon as practicable and at its
own expense, but in no event later than thirty (30) days after the
Closing Date, file a Registration Statement (as defined below) under
the Securities Act covering the resale of all of the Common Shares and
shall use its best efforts to cause such Registration Statement to be
declared effective not later than the 75th day following the Closing
Date (the "Required Registration Date"). The obligations to have the
Registration Statement declared effective and to maintain such
effectiveness as provided in this Section 4 (subject to any Blackout
Period that does not constitute a Blackout Violation) are referred to
herein as the "Registration Requirement." Pursuant to the preceding
sentence, Newpark shall register pursuant to such Registration
Statement not less than the number of shares of Common Stock equal at
least to the sum of (x) the 1,900,000 Common Shares initially issuable
under the Warrant plus (y) all Common Shares that may become issuable
under the Warrant pursuant to Sections 2, 3 and 4 thereof plus (z) (1)
1.5 times (2) the total number of Common Shares issued or issuable
under this Agreement excluding the Warrant (including all shares issued
or issuable under the Preferred Shares, whether upon conversion, as
dividends within the year following such date (assuming that all
dividends are made as required in the Certificate of Rights and
Preferences and are made in Common Stock) or otherwise on an
as-converted basis as of such date) (the "Registrable Number"). Newpark
shall promptly amend such Registration Statement (or, if necessary,
file a new Registration Statement) at any time that the number of
Common Shares issued and issuable under this Agreement exceeds eighty
percent (80%) of the number of shares then registered so that the
Registrable Number (as determined on such date) of Common Shares shall
be registered and freely tradable.
b. Each Common Share is a "Covered Security" and the
registration statement filed or required to be filed under the
Securities Act in accordance with Section 4.a hereof is referred to as
the "Registration Statement". Newpark shall provide prompt written
notice to Xxxxxxxx when the Registration Statement has been declared
effective by the SEC.
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c. Newpark will use its best efforts to: (A) keep the
Registration Statement effective until the earlier of (x) the later of
(i) the second anniversary of the issuance of the last Covered Security
that may be issued, or (ii) such time as all of the Covered Securities
issued or issuable to Xxxxxxxx can be sold by Xxxxxxxx or any of its
affiliates within a three (3)-month period without compliance with the
registration requirements of the Securities Act pursuant to Rule 144
under the Securities Act ("Rule 144") or (y) the date all of the
Covered Securities issued or issuable shall have been sold by Xxxxxxxx;
(B) prepare and file with the SEC such amendments and supplements to
the Registration Statement and the prospectus used in connection with
the Registration Statement (as so amended and supplemented from time to
time, the "Prospectus") as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
Covered Securities by Xxxxxxxx or any of its affiliates; (C) furnish
such number of Prospectuses and other documents incident thereto,
including any amendment of or supplement to the Prospectus, as Xxxxxxxx
from time to time may reasonably request; (D) cause all Covered
Securities to be listed on each securities exchange and quoted on each
quotation service on which similar securities issued by Newpark are
then listed or quoted; (E) provide a transfer agent and registrar for
all Covered Securities and a CUSIP number for all Covered Securities;
(F) otherwise comply with all applicable rules and regulations of the
SEC, the New York Stock Exchange and any other exchange or quotation
service on which the Covered Securities are obligated to be listed or
quoted under this Agreement; and (G) file the documents required of
Newpark and otherwise obtain and maintain requisite blue sky clearance
in (x) New York, Delaware and all other jurisdictions in which any of
the shares of Common Stock were originally sold and (y) all other
states specified in writing by Xxxxxxxx, provided, however, that as to
this clause (y), Newpark shall not be required to qualify to do
business or consent to service of process in any state in which it is
not now so qualified or has not so consented. Xxxxxxxx shall have the
right to approve the description of the plan of distribution and all
other references to Xxxxxxxx contained in any Registration Statement
and any Prospectus.
d. Newpark shall furnish to Xxxxxxxx upon request a
reasonable number of copies of a supplement to or an amendment of any
Prospectus as may be necessary in order to facilitate the public sale
or other disposition of all or any of the Covered Securities by
Xxxxxxxx or any of its affiliates pursuant to the Registration
Statement.
e. With a view to making available to Xxxxxxxx and
its affiliates the benefits of Rule 144 and Form S-3 under the
Securities Act, Newpark covenants and agrees to: (A) make and keep
available adequate current public information (within the meaning of
Rule 144(c)) concerning Newpark, until the earlier of (x) the second
anniversary of the issuance of the last Covered Security to be issued
or (y) such date as all of the Covered Securities shall have been
resold by Xxxxxxxx or any of its affiliates; and (B) furnish to
Xxxxxxxx upon request, as long as Xxxxxxxx owns any Covered
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Securities, (x) a written statement by Newpark that it has complied
with the reporting requirements of the Securities Act and the Exchange
Act, (y) a copy of the most recent annual or quarterly report of
Newpark, and (z) such other information as may be reasonably requested
in order to avail Xxxxxxxx and its affiliates of Rule 144 or Form S-3
with respect to such Covered Securities.
f. Notwithstanding anything else in this Section 4,
if, at any time during which a Prospectus is required to be delivered
in connection with the sale of any Covered Security, Newpark determines
in good faith that a development has occurred or a condition exists as
a result of which the Registration Statement or the Prospectus contains
a material misstatement or omission, or that a material transaction in
which Newpark is engaged or proposes to engage would require an
amendment to the Registration Statement or a supplement to the
Prospectus and the disclosure of such transaction would be premature or
injurious to the consummation of the transaction, Newpark will
immediately notify Xxxxxxxx thereof by telephone and in writing. Upon
receipt of such notification, Xxxxxxxx and its affiliates will
immediately suspend all offers and sales of any Covered Security
pursuant to the Registration Statement. In such event, Newpark will
amend or supplement the Registration Statement as promptly as
practicable and will use its best efforts to take such other steps as
may be required to permit sales of the Covered Securities thereunder by
Xxxxxxxx and its affiliates in accordance with applicable federal and
state securities laws. Newpark will promptly notify Xxxxxxxx after it
has determined in good faith that such sales have become permissible in
such manner and will promptly deliver copies of the Registration
Statement and the Prospectus (as so amended or supplemented) to
Xxxxxxxx in accordance with paragraphs (c) and (d) of this Section 4.
Notwithstanding the foregoing, (A) under no circumstances shall Newpark
be entitled to exercise its right to suspend sales of any Covered
Securities pursuant to the Registration Statement more than twice in
any twelve (12)-month period, (B) the period during which such sales
may be suspended (each a "Blackout Period") shall not exceed thirty
(30) days, and (C) no Blackout Period may commence less than thirty
(30) days after the end of the preceding Blackout Period. If any
Blackout Period shall exceed the duration or frequency limits set forth
in clause (A) or (B) (a "Blackout Violation"), then from the first day
of such Blackout Violation until the first anniversary of the last day
of the Blackout Period causing such Blackout Violation, (i) the Warrant
Price under the Warrant shall decrease by two and one-half percent
(2.5%) and (ii) the Conversion Price under the Certificate of Rights
and Preferences shall decrease by two and one-half percent (2.5%). If a
second Blackout Violation occurs before (or if the original Blackout
Violation shall continue on) the first anniversary of the first day of
the original Blackout Violation, then (i) the Warrant Price under the
Warrant shall decrease by an additional two and one-half percent (2.5%)
and (ii) the Conversion Price under the Preferred Shares shall decrease
by an additional two and one-half percent (2.5%). Each subsequent
Blackout Violation occurring on or before the anniversary of the first
day of such Blackout Violation shall cause the Warrant Price and
Conversion Price each to decrease by two and one-half percent (2.5%) in
addition to all prior decreases, provided that not more than one such
additional decrease shall take effect in any twelve (12)-month period.
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All such adjustments in the Warrant Price and the Conversion Price
shall continue until twelve (12) months shall have passed without a
Blackout Violation.
Upon the commencement of a Blackout Period pursuant to this
Section 4, Xxxxxxxx will notify Newpark of any contract to sell,
assign, deliver or otherwise transfer any Covered Security (each a
"Sales Contract") that Xxxxxxxx or any of its affiliates has entered
into prior to the commencement of such Blackout Period and that would
require delivery of such Covered Securities during such Blackout
Period, which notice will contain the aggregate sale price and volume
of Covered Securities pursuant to such Sales Contract. Upon receipt of
such notice, Newpark will immediately notify Xxxxxxxx of its election
either (i) to terminate the Blackout Period and, as promptly as
practicable, amend or supplement the Registration Statement or the
Prospectus in order to correct the material misstatement or omission
and deliver to Xxxxxxxx copies of such amended or supplemented
Registration Statement and Prospectus in accordance with paragraphs (c)
and (d) of this Section 4, or (ii) to continue the Blackout Period in
accordance with this paragraph. If Newpark elects to continue the
Blackout Period (and, in any case, if a Blackout Violation occurs), and
Xxxxxxxx or any of its affiliates are therefore unable to consummate
the sale of Covered Securities pursuant to the Sales Contract, Newpark
will promptly indemnify each Xxxxxxxx Indemnified Party (as such term
is defined in Section 17.a. below) against any Proceeding (as such term
is defined in Section 17.a. below) that each Xxxxxxxx Indemnified Party
may incur arising out of or in connection with Xxxxxxxx'x breach or
alleged breach of any such Sales Contract, and Newpark shall reimburse
each Xxxxxxxx Indemnified Party for any reasonable costs or expenses
(including reasonable legal fees) incurred by such party in
investigating or defending any such Proceeding (collectively, the
"Indemnification Amount").
g. In addition to any other remedies available to
Xxxxxxxx under this Agreement, if the Registration Statement has not
been declared effective by the Required Registration Date or such
Registration Statement is not available with respect to all Covered
Securities (except during a Blackout Period or a Blackout Violation),
then (A) the Conversion Price (as defined in the Certificate of Rights
and Preferences) shall be permanently decreased by two and one-half
percent (2.5%) for each month (or portion thereof), compounded monthly,
that such Registration Statement shall not have been declared effective
or such Registration Statement is not available with respect to all
Covered Securities (except during a Blackout Period or a Blackout
Violation), and (B) the Warrant Price (as defined in the Warrant
Certificate) shall be permanently decreased by two and one-half percent
(2.5%) for each month (or portion thereof), compounded monthly, that
such Registration Statement shall not have been declared effective or
such Registration Statement is not available with respect to all
Covered Securities (except during a Blackout Period or a Blackout
Violation); provided that any adjustment in this Section 4(g) caused by
a Registration Statement that is available with respect to fewer than
all of the Covered Securities shall affect all Covered Securities
unless such
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Registration Statement is unavailable for less than 5,000 shares of
Covered Securities, in which case such adjustment shall only affect
such lesser number of Covered Securities.
h. Nothing in this Section 4 shall be construed to
impose an obligation upon Newpark to register the Warrant or the
Preferred Shares.
5. "Market Stand-Off" Agreement. If requested by Newpark and
an underwriter in a firm commitment underwritten public offering of Common Stock
with net proceeds of at least $25,000,000 to Newpark, after underwriter's
discounts or commissions and other fees or expenses, Xxxxxxxx shall not sell or
otherwise transfer or dispose of any Common Stock (other than Common Stock
included in the registration) during the ninety (90) day period (or such shorter
period, if so notified by Newpark in writing) following the effective date of a
registration statement of Newpark filed under the Securities Act, provided that:
a. such agreement shall only apply to registration
statements of Newpark including securities to be sold on its behalf to
the public in an underwritten offering where the effective date of any
such registration statement shall not occur before the first
anniversary of the effective date of the immediately prior registration
statement with respect to which Xxxxxxxx was required to provide such
agreement;
b. all officers and directors of Newpark, all
purchasers or subsequent holders of Offered Shares (other than
subsequent holders who acquire such securities through bona fide
purchases in the public market) and all holders of Newpark Series A
Cumulative Perpetual Preferred Stock are bound by and have entered into
similar agreements; and
c. Newpark shall (and shall cause such underwriter
to) use best efforts to cause such stand-off period not to exist or, if
it does exist, to terminate at the earliest practicable date.
The obligations described in this Section 5 shall not apply to a registration
relating solely to employee benefit plans on Form S-1 or Form S-8 or similar
forms that may be promulgated in the future, or a registration relating solely
to a transaction on Form S-4 or similar forms that may be promulgated in the
future.
6. Conversion of Preferred Shares; Exercise of Warrant.
a. Preferred Shares are convertible into Common
Shares in accordance with the terms and conditions set forth in Section
6 of the Certificate of Rights and Preferences. The form of the
"Preferred Stock Conversion Notice" to be executed and delivered by
Xxxxxxxx to Newpark as specified therein is attached hereto as Annex E
and the form of the "Preferred Stock Conversion Delivery Notice" to be
executed and delivered by Newpark to Xxxxxxxx as specified therein is
attached hereto as Annex F.
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b. The Warrant is exercisable into Common Shares in
accordance with the terms and conditions set forth in the Warrant
Certificate. The form of the "Warrant Exercise Notice" to be executed
and delivered by Xxxxxxxx to Newpark as specified therein is attached
as Exhibit 1 to the Warrant and the form of the "Warrant Exercise
Delivery Notice" to be executed and delivered by Newpark to Xxxxxxxx as
specified therein is attached as Exhibit 2 to the Warrant.
c. In the event the number of Common Shares issued
and/or issuable on any date (a "Trigger Date") together with any Common
Shares issuable as dividends within one (1) year following such date,
assuming that all such dividends are paid in Common Stock and are paid
as they accrue, in each case without regard to any 65 Day Notice
requirements, would result in Xxxxxxxx receiving more than seventeen
and one-half percent (17.5%) of the shares of Common Stock outstanding
as of the date of this Agreement (the "Original Number"), Newpark (A)
shall not issue Common Shares (the "Issuance Blockage") to the extent
that the total number of Common Shares issued hereunder would exceed
nineteen and ninety-nine one-hundredths percent (19.99%) of the
Original Number and such circumstance would require the approval (the
"Required Consent") of the holders of Common Stock pursuant to the
listing requirements or rules of the New York Stock Exchange (or such
other U.S. national securities exchange on which Common Stock is then
listed), (B) shall notify Newpark's stockholders of a stockholder
meeting for the purpose of voting on the Required Consent within twenty
(20) Trading Days from the Trigger Date, which meeting shall be held on
or before the 60th calendar day after the Trigger Date, and (C) shall
otherwise use its best efforts to obtain, on or before the 60th day
after the Trigger Date, the Required Consent for the issuance of all
Common Shares issued or issuable under this Agreement (including, but
not limited to, all previously issued Common Shares and all unconverted
Preferred Shares and any unexercised rights under the Warrant and all
shares that may become issuable as dividends under the Preferred
Shares, assuming that all such dividends are paid in Common Stock and
are paid as they accrue) including, but not limited to, recommending to
Newpark's stockholders that such stockholders give the Required Consent
and not withdrawing such recommendation. If the Required Consent has
not been obtained within such sixty (60)-day period, or Newpark
otherwise does not have sufficient authorized shares to fulfill its
obligation, Xxxxxxxx shall have the right to:
(x) instruct Newpark to apply to the payment required by
Section 1 of the Warrant such number of the shares of Common
Stock otherwise issuable to Xxxxxxxx upon such exercise as
shall be specified by Xxxxxxxx, in which case an amount equal
to the excess of (i) (A) the daily volume-weighted average
price on the NYSE or, if no such sale takes place on such
date, the average of the closing bid and asked prices on the
NYSE thereof on such date, in each case as reported by
Bloomberg, L.P. (or by such other entity as Xxxxxxxx and
Newpark may agree), or (B) if such Common Stock is not then
listed or admitted to trading on the NYSE, the higher of (1)
the book value thereof as determined by any firm of
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independent public accountants of recognized standing selected
by the Board of Directors of the Issuer as of the last day of
any month ending within sixty (60) days preceding the date as
of which the determination is to be made or (2) the fair value
thereof determined in good faith by the Board of Directors of
the Issuer as of a date which is within eighteen (18) days of
the date as of which the determination is to be made (the
"Average Price") over (ii) the portion of the payment required
by Section 1 of the Warrant attributable to such shares shall
be deemed to have been paid to Newpark and the number of
Common Shares issuable upon such exercise shall be reduced by
such specified number, provided, however, that such
instructions shall not be honored and shall have no effect to
the extent that as a result of following such instructions,
the total number of Common Shares issued hereunder would cause
a Required Consent to be required;
(y) convert up to that amount of the Preferred Shares or
exercise any portion of the Warrant, the conversion or
exercise of which would result in the total number of shares
issued hereunder exceeding nineteen and ninety-nine
one-hundredths percent (19.99%) of the Original Number or that
number which is unavailable for issuance, as the case may be,
into the rights described herein (the "Excess Rights").
Xxxxxxxx shall exercise such right to obtain Excess Rights by
delivering one or more written notices in the form attached
hereto as Annex G (an "Excess Rights Notice") to Newpark from
time to time. The date an Excess Rights Notice is delivered
shall be an "Excess Notice Date." The stated value of the
Excess Rights shall be an amount equal to (1) in the case of
the Warrant the product of (A) the positive excess of the
Average Price on the Excess Notice Date over the Warrant Price
(as defined in the Warrant) per Common Share and (B) the
number of Common Shares that would be issuable in respect of
such exercise but for the Issuance Blockage (without regard to
any requirement to deliver a 65 Day Notice) and (2) in the
case of Preferred Shares the product of (A) the Average Price
on the Excess Notice Date and by (B) the number of Common
Shares that would be issuable in respect of such conversion
but for the Issuance Blockage (without regard to any
requirement to deliver a 65 Day Notice). From creation until
the first anniversary of the date on which the Required
Consent is obtained, Excess Rights may, in whole or in part,
from time to time, in any combination (i) be applied in lieu
of payment, with each dollar of stated value of Excess Rights
applied as a dollar of payment, of the Warrant Price under
Section 1 of the Warrant or (ii) be converted into additional
Preferred Shares (identical in all respects to the Preferred
Shares originally issued hereunder, provided that such shares
may bear a different name (e.g., "Series B-1 Convertible
Preferred Stock")) at the ratio of $250 of stated value of
Excess Rights to one Preferred Share, or
(z) any combination of clauses (x) and (y).
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d. The aggregate number of Common Shares issuable
upon conversion of the Preferred Shares and exercise of the Warrant
shall not exceed the Maximum Number of shares of Common Stock. The
"Maximum Number" equals the sum of 6,743,075 plus the Exercisable
Number. The "Exercisable Number" is initially zero and thereafter may
be increased upon expiration of a sixty-five (65) day period (the
"Notice Period") after either (i) Xxxxxxxx delivers a notice (a"65 Day
Notice") to Newpark designating an aggregate number of Common Shares in
excess of the Maximum Number which shall be issuable upon conversion of
the Preferred Shares or exercise of the Warrant, or (ii) Newpark
delivers a notice (an "Increase Notice") stating the increase, if any
(the "Increase"), in the aggregate number of Common Shares outstanding
as of the last day of the preceding month over the number outstanding
as of the last day of the second preceding month, or in the case of the
last day of the month immediately following the Closing Date, the
number of shares outstanding specified in Section 3(l), in which event
the Exercisable Number shall be automatically increased by the number
which is nine and three-quarters percent (9.75%) of the Increase. A 65
Day Notice may be given at any time. Unless expressly waived by
Xxxxxxxx, Newpark shall deliver an Increase Notice to Xxxxxxxx on or
before the 10th day of every calendar month from and including the
Closing Date. From time to time following the Notice Period, Common
Stock may be issued to Xxxxxxxx on any Business Day for any quantity of
Common Stock, such that the aggregate number of shares of Common Stock
issued hereunder is less than or equal to the Maximum Number. Nothing
in this Section 6(d) shall limit or apply to the creation or conversion
of Excess Rights under Section 6(c)(y).
e. Newpark shall use best efforts to obtain from the
Newpark stockholders, if required, the requisite authority to issue
Common Shares to Xxxxxxxx in accordance with the terms of this
Agreement.
7. Representations and Warranties of Xxxxxxxx. Xxxxxxxx hereby
represents and warrants to Newpark on the Closing Date:
x. Xxxxxxxx has been duly incorporated and is validly
existing in good standing under the laws of the Cayman Islands.
b. The execution, delivery and performance of this
Agreement by Xxxxxxxx have been duly authorized by all requisite
corporate action and no further consent or authorization of Xxxxxxxx,
its Board of Directors or its shareholders is required. This Agreement
has been duly executed and delivered by Xxxxxxxx and, when duly
authorized, executed and delivered by Newpark, will be a valid and
binding agreement enforceable against Xxxxxxxx in accordance with its
terms, subject to bankruptcy, insolvency, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights generally and to general principles of equity.
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x. Xxxxxxxx understands that no United States federal
or state agency has passed on, reviewed or made any recommendation or
endorsement of the Investment Securities.
d. Subject to Section 4 hereof, Xxxxxxxx understands
that the Investment Securities have not been registered under the
Securities Act and may not be re-offered or resold in the United States
other than pursuant to registration thereunder or an available
exemption therefrom.
x. Xxxxxxxx is an "accredited investor" as such term
is defined in Regulation D promulgated under the Securities Act.
x. Xxxxxxxx is purchasing the Investment Securities
for its own account for investment only and not with a view to, or for
resale in connection with, the public sale or distribution thereof in
the United States, except pursuant to sales registered under the
Securities Act or an exemption therefrom.
x. Xxxxxxxx understands that the Investment
Securities are being or will be offered and sold to it in reliance on
specific exemptions from the registration requirements of United States
federal securities laws and that Newpark is relying on the truth and
accuracy of, and Xxxxxxxx'x compliance with, the representations,
warranties, agreements, acknowledgments and understandings of Xxxxxxxx
set forth herein in order to determine the availability of such
exemptions and the eligibility of Xxxxxxxx to acquire the Investment
Securities.
h. As of the date of this Agreement, the
consideration that Newpark is receiving from Xxxxxxxx is equivalent in
value to the consideration Xxxxxxxx is receiving from Newpark pursuant
to this Agreement. As of the date of this Agreement, under the terms of
this Agreement, Newpark is receiving fair consideration from Xxxxxxxx
for the agreements, covenants, representations and warranties made by
Newpark to Xxxxxxxx.
x. Xxxxxxxx has had access to documents publicly
filed with the SEC by Newpark, and has been given a reasonable
opportunity to ask questions of Newpark's officers regarding publicly
available information concerning Newpark.
8. Right of First Refusal. Subject to the terms and conditions
specified in this Section 8, Newpark hereby grants to (i) Xxxxxxxx, (ii) any
wholly-owned subsidiary or affiliate of Xxxxxxxx, or (iii) any of Xxxxxxxx'x
designees, which designee, along with the entities in clauses (i) and (ii)
above, then holds not less than one-half of the number of shares of Series B
Preferred Stock originally issued pursuant to this Agreement (the "First Refusal
Stockholders"), a right of first offer with respect to future sales by Newpark
of its Offered Shares (as hereinafter defined). Each time Newpark has a bona
fide proposal from a third party to acquire any shares of, or securities
convertible into or exercisable or exchangeable for any shares of, any class of
its capital stock ("Offered Shares") and Newpark wishes to sell the Offered
Shares to such third party,
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Newpark shall first offer such Offered Shares to the First Refusal Stockholders
in accordance with the following provisions:
a. Newpark shall deliver a notice in accordance with
Section 19 of this Agreement ("Offer Notice") to Xxxxxxxx stating (i)
its bona fide intention to offer such Offered Shares, (ii) the number
of such Offered Shares to be offered, (iii) the price and terms, if
any, upon which it proposes to offer such Offered Shares, and (iv) the
identity of the proposed purchasers of such shares and, if requested by
Xxxxxxxx, such purchasers' affiliates and associates.
b. For ten (10) Trading Days after delivery of the
Offer Notice, Newpark shall negotiate exclusively and in good faith
with the First Refusal Stockholders with respect to the proposed sale
of Offered Shares and Newpark shall not enter into or continue
negotiations with, respond to, furnish information to, or consummate
any transaction with any person or entity concerning any transaction
regarding any shares of, or securities convertible into or exercisable
or exchangeable for any shares of, any class of its capital stock.
c. Within ten (10) Trading Days after delivery of the
Offer Notice, the First Refusal Stockholders may elect by delivering a
written notice to Newpark, to purchase or obtain, at the price and on
the terms specified in the Offer Notice (or on terms that are
substantially similar to, or more favorable to Newpark than, the terms
contained in the Offer Notice), all (and not less than all unless a
third party agrees to purchase the remainder of such securities on
terms that are substantially similar to, or more favorable to Newpark
than, the terms contained in the Offer Notice) of the Offered Shares.
If the Offer Notice specifies consideration other than cash is to be
paid for the Offered Securities, the First Refusal Stockholders may, at
their sole option, (if they choose to purchase such Offered Shares)
deliver either of (i) such consideration or (ii) cash equal to the fair
market value of such consideration on the date and at the time such
offer is accepted. The closing of any such transaction shall occur not
later than ten (10) Trading Days after Newpark receives written notice
of such election. If the First Refusal Stockholders do not so elect
within ten (10) days after delivery of the Offer Notice, then Newpark
may sell the Offered Shares to any Person at the price and on terms
that are no less favorable to Newpark than the terms contained in the
Offer Notice within seventy (70) days after the date of the Offer
Notice.
d. The right of first offer in this Section 8 shall
not be applicable to any issuance or sale of any of the following
securities:
(i) Common Stock issued as consideration for
the acquisition of at least fifty percent (50%) of the voting
capital stock or assets of a bona fide operating company in a
similar or complementary line of business to that of Newpark,
as determined reasonably and in good faith by Newpark's board
of
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directors whether through purchase, merger, consolidation,
tender offer or otherwise, provided that the purpose of
Newpark entering into any such transaction shall not be to
raise capital, directly or indirectly, or otherwise to avoid
the requirements of this Section 8,
(ii) Common Stock issued pursuant to any
stock split, dividend or distribution payable in additional
shares of Common Stock or other securities or rights
convertible into, or entitling the holder thereof to receive
directly or indirectly, additional shares of Common Stock
without payment of any consideration by such holder,
(iii) Common Stock issuable or issued to
employees, consultants or directors of Newpark directly or
pursuant to a stock option plan, employee stock purchase plan
or restricted stock plan, or other similar arrangements
related to compensation for services in effect on the date of
this Agreement or approved by Newpark's stockholders, in each
case in the ordinary course of business consistent with
Newpark's past practice,
(iv) Common Stock issued in a bona fide firm
commitment underwritten offering to the public with net
proceeds of at least $25,000,000 to Newpark, after
underwriter's discounts or commissions and other fees or
expenses.
(v) Common Stock issued as dividends on, or
upon conversion of, Newpark's Series A Cumulative Perpetual
Preferred Stock outstanding as of the date of this Agreement
and Series B Preferred Stock,
(vi) Common Stock issuable under the Warrant
and the warrant issued to SCF-IV, L.P.; or
(vii) Common Stock issued in connection with
a Combination.
(e) The right of first offer hereunder shall be of no
further force or effect from and after the first day upon which the
Registrable Number shall be less than five percent (5%) of the Original
Number, as such numbers may be adjusted for stock splits, stock
dividends, reverse stock splits, recapitalizations or other, similar
adjustments.
9. Covenants of Newpark. Newpark covenants and agrees with
Xxxxxxxx as follows:
a. For so long as Xxxxxxxx owns any Investment
Securities, and in any case for a period of one (1) year thereafter,
Newpark will use its best efforts to (i) maintain the eligibility of
the Common Stock for listing on the New York Stock Exchange and (ii)
regain the eligibility of the Common Stock for listing or quotation on
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all markets and exchanges including the New York Stock Exchange in the
event that the Common Stock is delisted by the New York Stock Exchange
or any other applicable market or exchange; and will use commercially
reasonable efforts to (iii) cause the representations and warranties
contained in Section 3 to be and remain true and correct.
b. Newpark will provide Xxxxxxxx with an opportunity
to review and comment on any public disclosure by Newpark of
information regarding this Agreement and the transactions contemplated
hereby, prior to such public disclosure. Beginning on the date hereof
and for so long as Xxxxxxxx owns any Investment Securities and for a
period of ninety (90) days thereafter, Newpark will (i) promptly notify
Xxxxxxxx immediately following any public disclosure by Newpark of
material information regarding Newpark or its financial condition,
prospects or results of operation and (ii) provide Xxxxxxxx with copies
of all SEC filings.
c. As soon as such information is available (but in
no event later than two weeks after the Closing Date), Newpark shall
deliver to Xxxxxxxx a written notice stating the number of outstanding
shares of Common Stock as of the Closing Date.
d. Newpark will make all filings required by law with
respect to the transactions contemplated hereby;
e. Newpark will comply with the terms and conditions
of the Preferred Shares as set forth in the Certificate of Rights and
Preferences, and will not amend the Certificate of Rights and
Preferences without Xxxxxxxx'x express written consent.
f. Prior to the filing of each of its quarterly
reports on Form 10-Q with the SEC, Newpark shall cause Xxxxxx Xxxxxxxx
LLP to deliver to Xxxxxxxx a review report relating to the final
consolidated unaudited financial statements contained therein, prepared
in accordance with Statements of Auditing Standard No. 71.
g. If on any date the Registrable Number exceeds
eighty percent (80%) of the number of Common Shares then reserved for
issuance, then Newpark shall reserve for issuance within three (3)
Trading Days of such date a number of Common Shares not less than the
Registrable Number.
h. Newpark shall use its best efforts to ensure that
all Common Shares issued and issuable under this Agreement (including
all shares issued or issuable under the Preferred Shares and the
Warrant on an as-converted and as-exercised basis) become listed and/or
quoted and admitted for trading as soon as practicable and thereafter
remain listed and/or quoted. Moreover, Newpark will immediately notify
Xxxxxxxx in writing, pursuant to Section 19, once such shares are duly
listed or quoted or in the event that any such shares are delisted or
removed from quotation. If any such
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shares are delisted or removed from quotation, Newpark shall use its
best efforts to cause such shares to again be listed or quoted at the
earliest possible date.
i. Newpark shall use commercially reasonable efforts
to cause the Common Shares to be eligible for book-entry transfer
through The Depository Trust Company (or any successor thereto) as soon
as practicable after the date of this Agreement and thereafter to use
commercially reasonable efforts to maintain such eligibility.
10. Consolidation, Merger, Etc. In case Newpark shall be a
party to any transaction with any other entity or entities (the "Acquirer")
providing for (i) any acquisition of Newpark by means of merger or other form of
corporate reorganization in which outstanding shares of Newpark are exchanged
for securities or other consideration issued, or caused to be issued, by the
acquiring entity or its subsidiary or (ii) a sale of all or substantially all of
the assets of Newpark (on a consolidated basis) in a single transaction or
series of related transactions or (iii) any other transaction or series of
related transactions by Newpark in which the power to cast the majority of the
eligible votes at a meeting of Newpark's stockholders at which directors are
elected is transferred to a single entity or group acting in concert (each of
the foregoing being referred to as a "Combination"), Xxxxxxxx and its assigns
shall have the rights set forth in the Warrant and the Certificate of Rights and
Preferences regarding Combinations in addition to the rights contained in this
Agreement. Newpark agrees that it will not enter into an agreement with an
Acquirer for a Combination unless such agreement expressly obligates the
Acquirer to assume all of Newpark's obligations under this Agreement, the
Certificate of Rights and Preferences and the Warrant and to give Xxxxxxxx
written notice that the Acquirer has assumed such obligations. Newpark shall
provide Xxxxxxxx with written notice of any proposed Combination as soon as the
existence of a proposed Combination is made public by any person, and shall
notify Xxxxxxxx promptly of any material developments with respect to such
Combination, including reasonable advance notice of the date the Combination is
expected to become effective.
11. Covenants of Xxxxxxxx. Xxxxxxxx hereby covenants and
agrees with Newpark that:
a. Neither Xxxxxxxx nor any of its affiliates nor any
person acting on its or their behalf will at any time offer or sell any
Investment Securities other than pursuant to registration under the
Securities Act or pursuant to an available exemption therefrom.
x. Xxxxxxxx shall not engage an underwriter for an
underwritten public offering of Common Shares, unless such underwriter
shall be reasonably satisfactory to Newpark.
12. Legend. Subject to Section 4, Xxxxxxxx understands that
the certificates or other instruments representing the Investment Securities
shall bear a restrictive legend in the
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following form (and a stop transfer order may be placed against transfer of such
certificates or other instruments):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
APPLICABLE STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED UNLESS (1) THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER
SUCH ACT COVERING SUCH SECURITIES, OR (2) THE SALE IS MADE IN
ACCORDANCE WITH RULE 144 OR ANOTHER APPLICABLE EXEMPTION UNDER THE
SECURITIES ACT AND THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE
HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO THE COMPANY,
STATING THAT SUCH SALE, TRANSFER OR ASSIGNMENT IS EXEMPT FROM THE
REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
The legend set forth above shall be removed and Newpark shall
issue a certificate without such legend to any holder of Investment Securities
if, unless otherwise required by state securities laws, (a) such shares are sold
pursuant to an effective Registration Statement under the Securities Act, or (b)
such holder provides Newpark with an opinion of counsel reasonably satisfactory
to Newpark that such shares may be publicly sold pursuant to an exemption from
such registration requirements without restriction.
13. Conditions Precedent to Xxxxxxxx'x Obligations. The
obligations of Xxxxxxxx hereunder are subject to the performance by Newpark of
its obligations hereunder and to the satisfaction of the following additional
conditions precedent, unless expressly waived in writing by Xxxxxxxx:
a. On the Closing Date, (i) the representations and
warranties made by Newpark in this Agreement shall be true and correct;
(ii) Newpark shall have complied fully with all of the covenants and
agreements in this Agreement; and (iii) Xxxxxxxx shall have received a
certificate of the Chief Executive Officer and the Chief Financial
Officer of Newpark dated such date and to such effect.
b. On the Closing Date, Newpark shall have delivered
to Xxxxxxxx an opinion of Xxxxx, Xxxxx & Xxxxxx LLP reasonably
satisfactory to Xxxxxxxx, dated the date of delivery, confirming in
substance the matters covered in paragraphs (a), (b), (c), (d), (e) and
(f) of Section 3 hereof and to the effect that the offer and sale of
the Investment Securities to Xxxxxxxx hereunder do not require
registration under the Securities Act.
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c. On the Closing Date, Xxxxxxxx shall have received
a letter from Xxxxxx Xxxxxxxx LLP to the effect that, as of such date,
they consent to the inclusion in this Agreement of their respective
portions of the Auditor Report.
d. On the Closing Date, the Registrable Number shall
be duly listed and admitted for trading on the New York Stock Exchange.
14. Conditions Precedent to Newpark's Obligations. The
obligations of Newpark hereunder are subject to the performance by Xxxxxxxx of
its obligations hereunder and to the satisfaction (unless expressly waived in
writing by Newpark) of the additional conditions precedent that, on the Closing
Date: (i) the representations and warranties made by Xxxxxxxx in this Agreement
shall be true and correct; (ii) Xxxxxxxx shall have complied fully with all the
covenants and agreements in this Agreement; and (iii) Newpark shall have
received on such date a certificate of an appropriate officer of Xxxxxxxx dated
such date and to such effect.
15. Fees and Expenses. Each of Xxxxxxxx and Newpark agrees to
pay its own expenses incident to the performance of its obligations hereunder,
including, but not limited to the fees, expenses and disbursements of such
party's counsel, except as is otherwise expressly provided in this Agreement.
16. Non-Performance. If on the Closing Date Newpark shall fail
to deliver the Investment Securities to Xxxxxxxx required to be delivered
pursuant to this Agreement for any reason other than the failure of any
condition precedent to Newpark's obligations hereunder or the failure by
Xxxxxxxx to comply with its obligations hereunder, then Newpark shall:
a. indemnify and hold Xxxxxxxx harmless against any
loss, claim or damage (including without limitation, incidental and
consequential damages) arising from or as a result of such failure by
Newpark; and
b. reimburse Xxxxxxxx for all of its reasonable
out-of-pocket expenses, including fees and disbursements of its
counsel, incurred by Xxxxxxxx in connection with this Agreement and the
transactions contemplated herein and therein.
17. Indemnification.
a. Indemnification of Xxxxxxxx. Newpark hereby agrees
to indemnify Xxxxxxxx and each of its officers, directors, employees,
agents and affiliates and each person that controls (within the meaning
of Section 20 of the Exchange Act) any of the foregoing persons (each a
"Xxxxxxxx Indemnified Party") against any claim, demand, action,
liability, damages, loss, cost or expense (including, without
limitation, reasonable legal fees and expenses) (a "Proceeding"), that
it may incur in connection with any of the transactions contemplated
hereby arising out of or based upon:
21
27
(1) any untrue or alleged untrue statement
of a material fact in any Registration Statement, the
Prospectus or any SEC Filing incorporated by
reference into a Registration Statement or any SEC
Filing made after the date of this Agreement and
before any Registration Statement is filed with the
SEC or this Agreement by Newpark or any of its
affiliates or any person acting on its or their
behalf or omission or alleged omission to state
therein or herein any material fact necessary in
order to make the statements, in the light of the
circumstances under which they were made, not
misleading by Newpark or any of its affiliates or any
person acting on its or their behalf;
(2) any of the representations or warranties
made by Newpark herein or under the Warrant or the
Certificate of Rights and Preferences being untrue or
incorrect at the time such representation or warranty
was made; and
(3) any breach or non-performance by Newpark
of any of its covenants, agreements or obligations
under this Agreement;
and Newpark hereby agrees to reimburse each Xxxxxxxx Indemnified Party
for any reason able legal or other expenses incurred by such Xxxxxxxx
Indemnified Party in investigating or defending any such Proceeding;
provided, however, that the foregoing indemnity shall not apply to any
Proceeding to the extent that it arises out of or is based upon the
gross negligence or wilful misconduct of Xxxxxxxx in connection
therewith. Furthermore, the foregoing indemnity rights will not take
effect unless or until the total amount of the indemnification in the
aggregate is $10,000 or greater.
b. Indemnification of Newpark. Xxxxxxxx hereby agrees
to indemnify Newpark and each of its officers, directors, employees,
agents and affiliates and each person that controls (within the meaning
of Section 20 of the Exchange Act) any of the foregoing persons (each a
"Newpark Indemnified Party") against any Proceeding, that it may incur
in connection with any of the transactions contemplated hereby arising
out of or based upon:
(1) any untrue or alleged untrue statement
of a material fact by Xxxxxxxx or any of its
affiliates or any person acting on its or their
behalf or omission or alleged omission to state any
material fact necessary in order to make the
statements, in the light of the circumstances under
which they were made, not misleading by Xxxxxxxx or
any of its affiliates or any person acting on its or
their behalf;
(2) any of the representations or warranties
made by Xxxxxxxx herein being untrue or incorrect at
the time such representation or warranty was made;
and
22
28
(3) any breach or non-performance by
Xxxxxxxx of any of its covenants, agreements or
obligations under this Agreement;
and Xxxxxxxx hereby agrees to reimburse each Newpark Indemnified Party
for any reason able legal or other expenses incurred by such Newpark
Indemnified Party in investigating or defending any such Proceeding;
provided, however, that the foregoing indemnity shall not apply to any
Proceeding to the extent that it arises out of or is based upon the
gross negligence or wilful misconduct of Newpark in connection
therewith. Furthermore, the foregoing indemnity rights will not take
effect unless or until the total amount of the indemnification in the
aggregate is $10,000 or greater.
c. Conduct of Claims.
(1) Whenever a claim for indemnification
shall arise under this Section 17, the party seeking
indemnification (the "Indemnified Party"), shall
notify the party from whom such indemnification is
sought (the "Indemnifying Party") in writing of the
Proceeding and the facts constituting the basis for
such claim in reasonable detail;
(2) Upon delivery of such notice, such
Indemnified Party shall have a duty to take all
reasonable steps to mitigate any losses, liabilities,
costs, charges and expenses relating to any such
Proceeding;
(3) Such Indemnifying Party shall have the
right to retain the counsel of its choice in
connection with such Proceeding and to participate at
its own expense in the defense of any such
Proceeding; provided, however, that counsel to the
Indemnifying Party shall not (except with the consent
of the relevant Indemnified Party) also be counsel to
such Indemnified Party. In no event shall the
Indemnifying Party be liable for fees and expenses of
more than one counsel (in addition to any local
counsel) separate from its own counsel for all
Indemnified Parties in connection with any one action
or separate but similar or related actions in the
same jurisdiction arising out of the same general
allegations or circumstances; and
(4) No Indemnifying Party shall, without the
prior written consent of the Indemnified Parties
(which consent shall not be unreasonably withheld),
settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any
investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification could
be sought under this Section unless such settlement,
compromise or consent (A) includes an unconditional
release of each Indemnified Party from all
23
29
liability arising out of such litigation,
investigation, proceeding or claim and (B) does not
include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of
any Indemnified Party.
18. Survival of the Representations, Warranties, etc. The
respective representations, warranties, and agreements made herein by or on
behalf of the parties hereto shall remain in full force and effect, regardless
of any investigation made by or on behalf of the other party to this Agreement
or any officer, director or employee of, or person controlling or under common
control with, such party and will survive delivery of and payment for any
Investment Securities issuable hereunder.
19. Notices. All communications hereunder shall be in writing
and delivered as set forth below.
a. If sent to Xxxxxxxx, all communications shall be
delivered by hand, sent by reputable overnight courier or transmitted
and confirmed by facsimile to Xxxxxxxx, unless otherwise notified in
writing of a substitute address, at:
Xxxxxxxx International Limited
c/o HSBC Trust Corporation (Cayman) Limited
X.X. Xxx 0000
Xxxx Xxxxxx
Xxxxx Xxxxxx, Xxxxxx Xxxxxxx, B.W.I.
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxxx Asset Management
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
24
30
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
0000 Xxx Xxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
To the extent that any funds shall be delivered to Xxxxxxxx by wire
transfer, unless otherwise instructed by Xxxxxxxx, such funds should be
delivered in accordance with the following wire instructions:
Xxxxxxxx International Limited
Bank: Chase Manhattan Bank
ABA Number: 000-000-000
For the benefit of: Xxxxxx Brothers Inc.
Account Number: 000-000-000
For credit to: Xxxxxxxx International Limited
Account Number: 732-00157
b. If sent to Newpark, all communications shall be
delivered by hand, sent by reputable overnight courier or transmitted
and confirmed by facsimile to Newpark, unless otherwise notified in
writing of a substitute address, at:
Newpark Resources, Inc.
0000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxx, Xxxxx & Xxxxxx LLP
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx Xxxxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
25
31
To the extent that any funds shall be delivered to Newpark by wire
transfer, unless otherwise instructed by Newpark, such funds should
be delivered in accordance with the following wire instructions:
Newpark Resources, Inc.
Account Number: 552-700-16-9870-1
ABA Number: 000000000
Bank: Bank One Louisiana NA
Account Name: Newpark Resources, Inc.
20. Miscellaneous.
a. This Agreement may be executed in one or more
counterparts and it is not necessary that signatures of all parties
appear on the same counterpart, but such counterparts together shall
constitute but one and the same agreement.
b. This Agreement shall inure to the benefit of and
be binding upon the parties hereto, their respective successors and
assigns and, with respect to Section 17 hereof, shall inure to the
benefit of their respective officers, directors, employees, agents,
affiliates and controlling persons, and no other person shall have any
right or obligation hereunder. Newpark may not assign this Agreement.
Xxxxxxxx may assign, pledge, hypothecate or transfer any of the rights
and associated obligations contemplated by this Agreement (including,
but not limited to, the Warrant, the Preferred Shares and the Common
Shares), in whole or in part, at its sole discretion (including, but
not limited to, assignments, pledges, hypothecations and transfers in
connection with hedging transactions with respect to this Agreement,
the Warrant, the Preferred Shares and the Common Shares), provided that
(i) any such assignment, pledge, hypothecation or transfer must comply
with applicable federal and state securities laws and (ii) Xxxxxxxx
shall furnish Newpark with an opinion of counsel reasonably
satisfactory to Newpark that such assignment, pledge, hypothecation or
transfer so complies (except with respect to Common Stock that is
registered under the Securities Act). No Person acquiring Common Stock
from Xxxxxxxx pursuant to a public market purchase shall thereby obtain
any of the rights contained in this Agreement.
c. This Agreement shall be governed by, and construed
in accordance with, the internal laws of the State of New York, and
each of the parties hereto hereby submits to the non-exclusive
jurisdiction of any State or Federal court in the State of New York and
any court hearing any appeal therefrom, over any suit, action or
proceeding against it arising out of or based upon this Agreement (a
"Related Proceeding"). Each of the parties hereto hereby waives any
objection to any Related Proceeding in such courts whether on the
grounds of venue, residence or domicile or on the ground that the
Related Proceeding has been brought in an inconvenient forum.
26
32
d. The parties shall take all actions reasonably
necessary to cause the transactions contemplated hereby to be
consummated in accordance with the terms hereof.
e. The headings of the sections of this document have
been inserted for convenience of reference only and shall not be deemed
to be a part of this Agreement. This Agreement constitutes the entire
agreement and supersedes all prior agreements and understandings, both
written and oral, between the parties hereto with respect to the
subject matter of this Agreement. Except as provided in Section 20(b),
this Agreement is not intended to confer upon any person other than the
parties hereto any rights or remedies hereunder.
f. Each party represents and acknowledges that, in
the negotiation and drafting of this Agreement and the other
instruments and documents required or contemplated hereby, it has been
represented by and relied upon the advice of counsel of its choice.
Each party hereby affirms that its counsel has had a substantial role
in the drafting and negotiation of this Agreement and such other
instruments and documents. Therefore, each party agrees that no rule of
construction to the effect that any ambiguities are to be resolved
against the drafter shall be employed in the interpretation of this
Agreement and such other instruments and documents.
g. Without prejudice to other rights or remedies
hereunder (including any specified interest rate), and except as
otherwise expressly set forth herein, interest shall be due on any
amount that is due pursuant to this Agreement and has not been paid
when due, calculated for the period from and including the due date to
but excluding the date on which such amount is paid at the prime rate
of U.S. money center banks as published in The Wall Street Journal (or
if The Wall Street Journal does not exist or publish such information,
then the average of the prime rates of three U.S. money center banks
agreed to by the parties) plus two percent (2%).
x. Xxxxxxxx and Newpark stipulate that the remedies
at law of the parties hereto in the event of any default or threatened
default by the either party in the performance of or compliance with
any of the terms of this Agreement, the Certificate of Rights and
Preferences and the Warrant are not and will not be adequate and that,
to the fullest extent permitted by law, such terms may be specifically
enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the
terms hereof or otherwise.
i. Any and all remedies set forth in this Agreement,
the Warrant and the Certificate of Rights and Preferences: (i) shall be
in addition to any and all other remedies Xxxxxxxx or Newpark may have
at law or in equity, (ii) shall be cumulative, and (iii) may be pursued
successively or concurrently as each of Xxxxxxxx and Newpark may elect.
The exercise of any remedy by Xxxxxxxx or Newpark shall not be deemed
an
27
33
election of remedies or preclude Xxxxxxxx or Newpark, respectively,
from exercising any other remedies in the future.
21. Newpark's Obligations. Newpark agrees that the parties
have negotiated in good faith and at arms' length concerning the transactions
contemplated herein, and that Xxxxxxxx would not have agreed to the terms of
this Agreement without each and every of the terms, conditions, protections and
remedies provided herein and in the Warrant and the Certificate of Rights and
Preferences. Except as specifically provided otherwise in this Agreement or in
the Warrant or the Certificate of Rights and Preferences, Newpark's obligations
to indemnify and hold Xxxxxxxx harmless in accordance with Section 17 of this
Agreement are obligations of Newpark that Newpark promises to pay to Xxxxxxxx
when and if they become due. Newpark shall record any such obligations on its
books and records in accordance with Generally Accepted Accounting Principles.
22. Time of Essence. Time shall be of the essence in this
Agreement.
[SIGNATURE PAGE FOLLOWS]
28
34
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement, all as of the day and year first above written.
NEWPARK RESOURCES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
-------------------------------------
Title: Vice President of Finance & CEO
------------------------------------
XXXXXXXX INTERNATIONAL LIMITED,
by its duly authorized investment advisor,
XXXXXXXX ASSET MANAGEMENT, INC.
By: /s/ Xxxx X. Xxxxxx
---------------------------------------
Name: Xxxx X. Xxxxxx
-------------------------------------
Title: Vice Chairman
------------------------------------
[AGREEMENT SIGNATURE PAGE]
35
ANNEX A
[FORM OF CERTIFICATE OF RIGHTS AND PREFERENCES OF
CLASS B CONVERTIBLE PREFERRED STOCK OF
NEWPARK RESOURCES, INC.]
[SEE TAB 2]
A-1
36
ANNEX B
[FORM OF WARRANT CERTIFICATE]
[SEE TAB 3]
B-1
37
ANNEX C
[FORM OF DELIVERY NOTICE]
[date]
Xxxxxxxx International Limited
c/o Fletcher Asset Management
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Ladies and Gentlemen:
Reference is made to the Agreement (the "Agreement") dated as
of May 30, 2000 by and between Newpark Resources, Inc. ("Newpark") and
Xxxxxxxx International Limited ("Xxxxxxxx"). Capitalized terms not
otherwise defined herein shall have the meanings ascribed thereto in
the Agreement.
Attached are copies of the front and back of (i) the 6
original stock certificates, each representing 20,000 shares of Series
B Preferred Stock, purchased by Xxxxxxxx on the date hereof and (ii)
Warrant No. W-1 issued to Xxxxxxxx, together with a copy of the
overnight courier air xxxx which will be used to ship such stock
certificates and warrant. We have the executed original stock
certificates and the warrant and other documents required to be
delivered in connection with the Closing Date. Upon our confirmation of
the payment of the $30,000,000 aggregate purchase price therefor, we
will send the original stock certificates and the warrant by overnight
courier to the following address:
Xx. Xxxxxxxx Xxxxx
c/x Xxxxxx Brothers Inc.
Three World Financial Center
Xxx Xxxx, XX 00000
and we will send the other original documents by overnight courier to
the following address:
Xxxxxxxx International Limited
c/o HSBC Trust Corporation (Cayman) Limited
X.X. Xxx 0000
Xxxx Xxxxxx
Xxxxx Xxxxxx, Xxxxxx Xxxxxxx, B.W.I.
Attn: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
C-1
38
with a copy to:
Xxxxxxxx International Limited
c/o Fletcher Asset Management
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attn: Xxxxx Xxxxxxx
Attached hereto as Exhibit 1 is a true, correct and complete
copy of the most recent report of Xxxxxx Xxxxxxxx LLP to the Board of
Directors and Shareholders of Newpark, together with the accompanying
consolidated financial statements and schedules of Newpark, as such
report appears in the most recent Annual Report on Form 10-K filed by
Newpark with the SEC, as well as all Quarterly Reports on Form 10-Q
filed by Newpark with the SEC since the date of such Form 10-K,
together with all amendments thereto.
NEWPARK RESOURCES, INC.
By:
-------------------------------------
Name:
Title:
C-2
39
Exhibit 1
AUDITOR REPORT
[see attached]
40
ANNEX D
Auditor Report
[SEE TAB 13]
D-1
41
ANNEX E
[FORM OF PREFERRED STOCK CONVERSION NOTICE]
[date]
Newpark Resources, Inc.
Suite 1770
0000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxx 00000
Attention: [Chief Financial Officer]
Telephone:
Facsimile:
Ladies and Gentlemen:
Reference is made to the Agreement (the "Agreement")
dated as of May 30, 2000 by and between Newpark Resources, Inc.
("Newpark") and Xxxxxxxx International Limited ("Xxxxxxxx").
Capitalized terms not otherwise defined herein shall have the meanings
ascribed thereto in the Agreement.
Xxxxxxxx hereby elects to convert _________ shares of
Series B Preferred Stock into ________ shares of Common Stock at a
Conversion Price (as defined in the Certificate of Rights and
Preferences) of ____________. In accordance with Section 6 of the
Certificate of Rights and Preferences, such shares of Common Stock
shall be delivered to Xxxxxxxx [in uncertificated form by book-entry
transfer][in certificated form at the address specified below:]
[delivery address to be added, if applicable:
Xxxxxx Brothers Inc.
Three World Financial Center
Xxx Xxxx, XX 00000
Attn: Xxxxxxxx Xxxxx]
XXXXXXXX INTERNATIONAL
LIMITED, by its duly
authorized investment
advisor, XXXXXXXX ASSET
MANAGEMENT, INC.
By:
-----------------------
Name:
Title:
X-0
00
XXXXXX XXX XXXXXXXXXXXX:
XXXXXXX RESOURCES, INC.
By:
-----------------------
Name:
Title:
X-0
00
XXXXX X
[FORM OF PREFERRED STOCK CONVERSION DELIVERY NOTICE]
[date]
Xxxxxxxx International Limited
c/o Fletcher Asset Management
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Ladies and Gentlemen:
Reference is made to the Agreement (the "Agreement") dated as
of May 30, 2000 by and between Newpark Resources, Inc. ("Newpark") and
Xxxxxxxx International Limited ("Xxxxxxxx"). Capitalized terms not
otherwise defined herein shall have the meanings ascribed thereto in
the Agreement.
This notice confirms that _________ shares of Series B
Preferred Stock have been converted by Xxxxxxxx into ________ shares of
Common Stock at a Conversion Price (as defined in the Certificate of
Rights and Preferences) of ____________. [If the shares are being
delivered by book entry transfer, insert the following -- Such shares
of Common Stock have been delivered to Xxxxxxxx in uncertificated form
by book-entry transfer.][If the shares are being delivered in physical
form to the holder, insert the following -- Attached are copies of the
front and back of the ____ original stock certificates, each
representing ______ shares of Common Stock, together with a copy of the
overnight courier air xxxx which will be used to ship such stock
certificates. We will send the original stock certificates by overnight
courier to the following address:
Xxxxxx Brothers Inc.
Three World Financial Center
Xxx Xxxx, XX 00000
Attn: Xxxxxxxx Xxxxx
with a copy to:
Xxxxxxxx International Limited
c/o Fletcher Asset Management
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attn: Xxxxx Xxxxxxx]
F-1
44
[If Preferred Stock certificates tendered by Xxxxxxxx are not
being fully converted, insert the following-Also attached are copies of
the front and back of the original stock certificate representing
______ shares of Series B Preferred Stock, representing the unconverted
portion of the tendered Series B Preferred Stock certificates, together
with a copy of the overnight courier air xxxx which will be used to
ship such stock certificate. We will send the original stock
certificate by overnight courier to Xxxxxx Brothers Inc. at the address
set forth in the previous paragraph.]
NEWPARK RESOURCES, INC.
By:
-----------------------
Name:
Title:
F-2
45
ANNEX G
[FORM OF EXCESS RIGHTS NOTICE]
_____________, __
Newpark Resources, Inc.
Suite 1770
0000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxxxx 00000
Attention: [Chief Financial Officer]
Ladies and Gentlemen:
Xxxxxxxx International Limited ("Xxxxxxxx") hereby
elects to exercise its right to convert some or all of its Preferred
Shares or Warrant rights (as defined in the Agreement (the
"Agreement")) dated as of May 30, 2000 by and between Newpark
Resources, Inc. ("Newpark") and Xxxxxxxx and, in lieu of receipt of
________ Common Shares upon conversion of _______ Preferred Shares and
exercise of _______ Common Shares on the face of the Warrant, hereby
requests creation of Excess Rights with a stated value of $________ in
accordance with the terms of the Agreement. Capitalized terms not
otherwise defined herein shall have the meanings ascribed thereto in
the Agreement.
XXXXXXXX INTERNATIONAL
LIMITED, by its duly
authorized investment
advisor, XXXXXXXX ASSET
MANAGEMENT, INC.
By:
-----------------------
Name:
Title:
AGREED AND ACKNOWLEDGED:
NEWPARK RESOURCES, INC.
By:
-----------------------
Name:
Title:
