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(Amended as of August 28, 1995)
AGREEMENT
This Agreement, dated as of June 23, 1995 (this "Agreement"), among
XXXXXXXXXXX INTERNATIONAL INCORPORATED, a Delaware corporation ("Weatherford")
and AMERICAN GAS & OIL INVESTORS, LIMITED PARTNERSHIP, a New York limited
partnership, AMGO II, LIMITED PARTNERSHIP, a New York limited partnership, AMGO
III, LIMITED PARTNERSHIP, a New York limited partnership, FIRST RESERVE SECURED
ENERGY ASSETS FUND, LIMITED PARTNERSHIP, a Delaware limited partnership, FIRST
RESERVE FUND V, LIMITED PARTNERSHIP, a Delaware limited partnership, FIRST
RESERVE FUND V-2, LIMITED PARTNERSHIP, a Delaware limited partnership and FIRST
RESERVE FUND VI, LIMITED PARTNERSHIP, a Delaware limited partnership (each a
"First Reserve Fund" and together the "First Reserve Funds") and First Reserve
Corporation, a Delaware corporation - ("FRC"). (The First Reserve Funds and
FRC, and all other persons or entities now or hereafter directly or indirectly
controlling, controlled by or under common control with any of the First
Reserve Funds or FRC, are referred to collectively as the "FRC Group.")
WITNESSETH:
WHEREAS, the First Reserve Funds currently own in the aggregate
approximately 11,212,349 shares of common stock, par value $1.00 per share
("Enterra Common Stock"), of Enterra Corporation, a Delaware corporation
("Enterra");
WHEREAS, the shares of Enterra Common Stock owned by the First Reserve
Funds currently are subject to the terms and conditions of that certain
Agreement dated as of May 2, 1994 among Enterra, the First Reserve Funds and
FRC (the "Enterra Standstill Agreement");
WHEREAS, pursuant to an agreement and plan of merger (the "Merger
Agreement") dated June 23, 1995 between Enterra and Weatherford, each share of
outstanding Enterra Common Stock shall, at the Effective Time (as defined in
the Merger Agreement), be converted, pursuant to a merger (the "Merger") of
Enterra with and into Weatherford, into 0.845 of a share (which number reflects
a one for two reverse stock split to be effected at the closing) of common
stock, par value $.10 per share, of Weatherford ("Weatherford Common Stock");
WHEREAS, pursuant to the terms of the Merger, the First Reserve Funds
will own, as of the Effective Time, in the aggregate 9,474,431 shares (which
number reflects a one for two)
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reverse stock split to be effected at the closing) of Weatherford Common Stock;
WHEREAS, Weatherford and the FRC Group are entering into this Agreement
to establish certain arrangements with respect to the relationships between
them after the Effective Time, which arrangements are substantially similar to
the arrangements provided for in the Enterra Standstill Agreement; and
WHEREAS, Weatherford and the FRC Group believe that these arrangements
will be in the best interests of Weatherford and all of its shareholders from
and after the Effective Time.
NOW, THEREFORE, intending to be legally bound as of the Effective Time,
the parties hereto agree as follows:
Section 1. Certain Definitions. As used in this Agreement, the
following terms shall have the following meanings:
1.1. "Weatherford Voting Securities" shall mean collectively
Weatherford Common Stock, Weatherford preferred stock, par value $1.00 per
share, if entitled to Vote generally for the election of directors or
otherwise, any other class or series of Weatherford securities that is entitled
to vote generally for the election of directors or otherwise, and any other
securities, warrants or options or rights of any nature (whether or not issued
by Weatherford) that are convertible into, exchangeable for, or exercisable for
the purchase of, or otherwise give the holder thereof any rights in respect of
Weatherford Common Stock, Weatherford preferred stock that is entitled to vote
generally for the election of directors or otherwise, or any other class or
series of Weatherford securities that is entitled to vote generally for the
election of directors or otherwise.
1.2. "Termination Date" shall mean August 12, 2004.
1.3. The "Combined Voting Power" at any measurement date shall mean the
total number of votes which could have been cast in an election of directors of
Weatherford had a meeting of the stockholders of Weatherford been duly held
based upon a record date as of the measurement date if all Weatherford Voting
Securities then outstanding and entitled to vote at such meeting were present
and voted to the fullest extent possible at such meeting.
1.4. "13D/G Group" shall mean two or more persons acting together for
the purpose of acquiring, holding, voting or disposing of Weatherford Voting
Securities, which persons would be required under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and the rules and regulations
promulgated
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thereunder to file a statement on Schedule 13D or 13G with the Securities and
Exchange Commission (the "SEC") as a "person" within the meaning of Section
13(d)(3) of the Exchange Act if such persons beneficially owned sufficient
securities to require such a filing under the Exchange Act.
1.5. The concept of "beneficial ownership" and the terms "person" and
"group" shall have the meanings defined or adopted from time to time pursuant
to Regulation 13D-G adopted by the SEC under the Exchange Act.
Section 2. Representations and Warranties of Weatherford. Weatherford
represents and warrants that:
(a) Weatherford is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, with corporate
power to own its properties and to conduct its business as now conducted.
(b) As of June 21, 1995, the authorized capital stock of
Weatherford consists of (i) 80,000,000 shares of Weatherford Common Stock, of
which 54,276,632 shares were validly issued and outstanding, fully paid and
nonassessable and (ii) 1,000,000 shares of preferred stock, par value $1.00 per
share, of which no shares were issued and outstanding.
(c) Weatherford has full legal right, power and authority to enter
into this Agreement and perform its obligations hereunder. This Agreement has
been duly authorized, executed and delivered by Weatherford and constitutes a
legal, valid and binding agreement of Weatherford enforceable against
Weatherford in accordance with the terms hereof.
(d) Neither the execution and delivery of this Agreement nor the
performance of its obligations hereunder will conflict with or result in a
breach of or constitute a default under any law, rule, regulation, judgment,
order or decree of any court, arbitrator or governmental agency or
instrumentality or of its corporate charter or bylaws or of any agreement or
instrument to which it is a party or subject or by which its property is bound
or affected.
Section 3. Representations and Warranties of the FRC Group. Each of the
First Reserve Funds and FRC, jointly and severally, represents and warrants to
Weatherford as follows:
(a) Each First Reserve Fund is a validly existing partnership
under the laws of the jurisdiction of its organization, FRC is a validly
existing corporation under the laws of the jurisdiction of its incorporation,
and each First Reserve Fund and FRC has the full legal right, power and
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authority to enter into this Agreement and perform their respective obligations
hereunder.
(b) This Agreement has been duly authorized, executed and
delivered by each First Reserve Fund and by FRC, and this Agreement constitutes
the legal, valid and binding agreement of the FRC Group, enforceable against
the members of the FRC Group in accordance with the terms hereof.
(c) Neither the execution and delivery of this Agreement nor the
performance of their obligations hereunder will conflict with or result in a
breach of or constitute a default under any law, rule, regulation, judgment,
order or decree of any court, arbitrator or governmental agency or
instrumentality or of any agreement or instrument to which any First Reserve
Fund or FRC is bound or affected, or of the partnership agreements of any of
the First Reserve Funds, or of the charter and bylaws of FRC.
(d) As of the date of this Agreement and as of the Effective Time,
(i) each First Reserve Fund owns and will own of record the shares of Enterra
Common stock set forth opposite its respective name on the signature page of
this Agreement, (ii) there are and will be no beneficial owners of such shares
of Enterra Common Stock other than the First Reserve Funds and FRC, (iii) such
shares of Enterra Common Stock represent and will represent all of the shares
of Enterra Common Stock owned of record or beneficially by the First Reserve
Funds and FRC, and (iv) such shares of Enterra Common Stock are and will be
owned of record and beneficially by the First Reserve Funds and FRC, free and
clear of all pledges, liens, claims, security interests and other charges or
defects in title of any nature whatsoever. No shares of Weatherford Common
Stock are currently, and as of the Effective Time no shares of Weatherford
Common Stock will be, beneficially owned by any member of the FRC Group, except
for those shares of Weatherford Common stock issuable in the Merger upon
conversion of such shares of Enterra Common Stock.
Section 4. Covenants with Respect to Weatherford Voting Securities and
Other Matters. Prior to the Termination Date and subject to the further
provisions hereof:
4.1. Acquisition of Weatherford Voting Securities. No member of the
FRC Group shall, directly or indirectly, acquire, offer to acquire, agree to
acquire, become the beneficial owner of or obtain any rights in respect of any
Weatherford Voting Securities, by purchase or otherwise, or take any action in
furtherance thereof, if the effect of such acquisition, agreement or other
action would be (either immediately or upon consummation of any such
acquisition, agreement or other action, or expiration of any period of time
provided in any such acquisition, agreement or other action) (i) to increase
the aggregate beneficial ownership of Weatherford Voting Securities by the FRC
Group to
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such number of Weatherford Voting Securities that represents or possesses 20%
or more of the Combined Voting Power of Weatherford Voting securities, or (ii)
to increase the aggregate beneficial ownership of any class or series of
Weatherford Voting Securities by the FRC Group to greater than 20% of such
class or series. Notwithstanding the foregoing maximum percentage limitation,
(A) no member of the FRC Group shall be obligated to dispose of any Weatherford
Voting Securities beneficially owned in violation of such maximum percentage
limitations if, and solely to the extent that, the aggregate beneficial
ownership of the FRC Group is or will be increased solely as a result of a
recapitalization of Weatherford, a repurchase of any Weatherford Voting
Securities by Xxxxxxxxxxx or any of its subsidiaries, or any other action taken
by Xxxxxxxxxxx or its affiliates (except the FRC Group), if such
recapitalization, repurchase or other action was approved by a majority of the
directors then in office who were not designated by the FRC Group, and (B) if
any other person or group beneficially owns or acquires beneficial ownership of
Weatherford Voting Securities representing greater than 20% of the Combined
Voting Power, the applicable maximum percentage shall be increased to such
greater percentage. For purposes of calculating the maximum percentage
limitations, all Weatherford Voting Securities that are the subject of an
agreement, arrangement or understanding pursuant to which the FRC Group or any
member thereof has the right to obtain beneficial ownership of such
securities in the future shall also be deemed to be beneficially owned by the
FRC Group or the applicable member thereof.
4.2. Distribution of Weatherford Voting Securities. Each member of the
FRC Group covenants that it shall not, directly or indirectly, sell, transfer
any beneficial interest in, pledge, hypothecate or otherwise dispose of any
Weatherford Voting Security, except by conversion, exchange or exercise of such
Weatherford Voting Securities pursuant to their terms in a manner not otherwise
in violation of Section 4.1 hereof, in response to certain tender or exchange
offers as permitted by Section 4.6(b) hereof, or pursuant to:
(i) a bona fide pledge of or the granting of a security interest
or any other lien or encumbrance in such Weatherford Voting Securities
to a lender that is not a member of the FRC Group to secure a bona fide
loan for money borrowed made to one or more members of the FRC Group
with full recourse to the borrower or borrowers, the foreclosure of such
pledge or security interest or any other lien or encumbrance that may be
placed involuntarily upon any Weatherford Voting Securities, or the
subsequent sale or other disposition of such Weatherford Voting
Securities by such lender or its agent;
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(ii) a transfer, assignment, sale or disposition of such
Weatherford Voting Securities within the FRC Group to a member of the
FRC Group that has signed this Agreement;
(iii) a distribution of Weatherford Voting Securities to any
partner of a First Reserve Fund; provided that any distributee that is a
member of the FRC Group has signed this Agreement; and provided, further
that any arrangements coordinated or initiated by FRC to assist limited
partners in the sale of Weatherford Voting Securities distributed to
them must comply with the provisions of this section 4.2;
(iv) sale in a public offering registered under the Act pursuant
to the registration rights provided in Section 6 hereof;
(v) sales in broker's transactions, effected on the New York Stock
Exchange or any other securities exchange on which the Weatherford
Voting Securities are listed or in any other public trading market in
which the Weatherford Voting Securities are then being traded, in
compliance with the provisions of Rule 144 under the Act, ("Rule 144"),
including the volume restrictions set forth in such rule (excluding for
purposes of this clause (v) sales pursuant to the provisions of
paragraph (k) of Rule 144, which sales are included under (vi) below);
(vi) sales pursuant to paragraph (k) of Rule 144;
(vii) other negotiated sales of Weatherford Voting Securities; or
(viii) as provided in Section 4.6(b).
Notwithstanding the previous sentence, (A) in effecting any sale, transfer of
any beneficial interest in or other disposition of Weatherford Voting
Securities pursuant to clause (iv) above, the members of the FRC Group
selling, transferring or disposing such Weatherford Voting Securities shall use
their reasonable best efforts to refrain from selling, transferring or
disposing of such number of Weatherford Voting Securities as represent 3% or
more of the Combined Voting Power to any one person or group, (B) no single
sale, transfer of beneficial interest in or other disposition of any
Weatherford Voting Securities may be made by any member of the FRC Group, and
no related group of such sales, transfers or dispositions shall be made by the
FRC Group, pursuant to clauses (iii), (vi) and (vii) above if such number of
Weatherford Voting Securities as represent 5% or more of the
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Combined Voting Power are being sold, transferred or disposed of to any one
person or group; and (C) no sale, transfer of any beneficial interest in or
other disposition of Weatherford Voting Securities shall be made pursuant to
clauses (iii), (vi) and (vii) above to any one person or group who, upon
consummation of such sale, transfer or disposition of Weatherford Voting
Securities would, directly or indirectly, have beneficial ownership of or the
right to acquire beneficial ownership of such number of Weatherford Voting
Securities as represent 10% or more of the Combined Voting Power.
4.3. Voting Trusts. No member of the FRC Group shall deposit any
Weatherford Voting Securities in a voting trust or subject any Weatherford
Voting Securities to any arrangement or agreement with respect to the voting of
such securities unless all the parties to such voting trust, arrangement or
agreement are members of the FRC Group who have executed this Agreement.
4.4. Proxy Solicitations, etc. No members of the FRC Group shall
solicit proxies, assist any other person in the solicitation of proxies, become
a "participant" in a "solicitation," or assist any "participant" in a
"solicitation" (as such terns are defined in Rule 14a-1 of Regulation 14A under
the Exchange Act) in opposition to the recommendation of a majority of the
directors of Weatherford then in office who were not designated by the FRC
Group, or recommend or request that any other person take any such actions, or
submit any proposal for the vote of stockholders of Weatherford.
4.5. Stock Pooling. No member of the FRC Group shall join a
partnership, limited partnership, syndicate or other group, or otherwise act in
concert with any other person, for the purpose of acquiring, holding, voting or
disposing of any Weatherford Voting Securities, or otherwise become a member of
a 13D/G Group other than the FRC Group itself.
4.6. Takeover Offers.
(a) Each member of the FRC Group covenants and agrees not to (i)
publicly suggest or announce its willingness or desire to engage in a
transaction or group of transactions or have another person engage in a
transaction or group of transactions that would result in a change of control
of Weatherford, (ii) present to Xxxxxxxxxxx or to any third party any proposal
that can reasonably be expected to result in a change of control of
Xxxxxxxxxxx, or (iii) initiate, induce or attempt to induce or give
encouragement to any other person to initiate any proposal that can reasonably
be expected to result in a change of control of Weatherford.
(b) Subject to compliance with Section 4.6(a) above, on and after
the eleventh business day after commencement
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of a tender or exchange offer made by a person who is not a member of the FRC
Group for outstanding Weatherford Voting Securities (a "Qualifying Offer"),
any member of the FRC Group may tender or exchange any Weatherford Voting
Securities beneficially owned by it pursuant to such Qualifying Offer if the
Qualifying Offer shall have been approved, or not opposed, by the board of
directors of Weatherford. If a Qualifying Offer is opposed by the board of
directors of Weatherford, then, from and after the eleventh business day after
commencement of such Qualifying Offer, any member of the FRC Group may tender
or exchange shares of Weatherford Voting Securities pursuant to such Qualifying
Offer only if (i) no tender or exchange of, or indication of an intention to
tender or exchange, Weatherford Voting Securities is made by any member of the
FRC Group earlier than 24 hours prior to the expiration of any time after which
Weatherford Voting Securities tendered may be treated less favorably than
Weatherford Voting Securities tendered or exchanged prior thereto, and (ii) a
binding agreement is reached with the bidder or offeror prior to any tender or
exchange specifying that only such number of Weatherford Voting Securities
submitted for tender or exchange shall be accepted by the bidder or offeror as
are equal to (A) the percentage of such Weatherford Voting Securities not
beneficially owned by the FRC Group that have been tendered or exchanged,
multiplied by (B) the total number of such Weatherford Voting Securities
beneficially owned by the member of the FRC Group.
4.7. Pledge of Covered Securities. Each member of the FRC Group shall
promptly give notice to Weatherford of any margin call, demand for additional
security or collateral, or threat to enforce any pledge or security interest in
or with respect to any Weatherford Voting Security owned of record or
beneficially by it.
Section 5. Voting of Weatherford Voting Securities and Other Related
Matters.
(a) Each member of the FRC Group that is a holder of record of
Weatherford Voting Securities shall be present, and each member of the FRC
Group that is a beneficial owner of Weatherford Voting Securities shall cause
the holder of record to be present, in person or by proxy, at all meetings of
stockholders of Weatherford so that all Weatherford Voting Securities owned of
record or beneficially by the FRC Group may be counted for the purpose of
determining the presence of a quorum at such meetings.
(b) Upon the Effective Time, the number of directors of
Weatherford shall be established as 10 directors, and two individuals
designated by the FRC Group shall be elected as directors of Weatherford,
subject to the provisions of this Agreement. The parties hereto agree that the
number of directors
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of Weatherford may not be increased above 10 without the approval of a (i) a
majority of the directors and (ii) all of the directors designated by the FRC
Group. From and after the Effective Time, the FRC Group and the directors
designated by the FRC Group shall take no action to reduce the number of
directors of Weatherford below 10 directors.
(c) For purposes of this Agreement, directors "designated by the
FRC Group" shall include directors designated by the FRC Group as set forth in
Section 5.22 of the Merger Agreement or designated by certain members of the
FRC Group as anticipated by this Section 5, and any other directors of
Weatherford affiliated or associated with any member of the FRC Group.
(d) From and after the Effective Time, as long as the FRC Group
beneficially owns at least 15% of the Combined Voting Power of all Weatherford
Voting Securities, two of (i) First Reserve Secured Energy Assets Fund, Limited
Partnership, (ii) First Reserve Fund V, Limited Partnership, (iii) First
Reserve Fund V-2, Limited Partnership and (iv) First Reserve Fund VI, Limited
Partnership (the "Designating First Reserve Funds") as shall be selected by FRC
shall have the right to designate one director of Weatherford, for a total of
two directors of Weatherford (it being understood that the FRC Group shall not
have more than two designees on the board of directors of Weatherford at any
time); provided, however, that:
(i) At any time when the FRC Group beneficially owns less than
15% but at least 10% of the Combined Voting Power of all Weatherford
Voting Securities, one of the Designating First Reserve Funds, to be
selected by FRC, shall lose its right to designate a director of
Weatherford, and such Designating First Reserve Fund shall cause its
designee on the board of directors of Weatherford to resign forthwith
such that only one designee of the FRC Group remains on the board of
directors of Weatherford; and
(ii) At any time when the FRC Group beneficially owns less than
10% of the Combined Voting Power of all Weatherford Voting Securities,
none of the FRC Group shall have the right to designate any directors of
Weatherford, and the Designating First Reserve Fund whose designee
remains on Xxxxxxxxxxx'x board of directors shall cause its designee to
resign forthwith such that no designee of the FRC Group remains on the
board of directors of Weatherford, it being understood that at any time
that the FRC Group beneficially owns less than 10% of the Combined
Voting Power of Weatherford Voting Securities no member of the FRC
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Group shall seek representation on the board of directors of Weatherford.
(e) Xxxxxxxxxxx shall take all necessary or appropriate action to
(i) assist in the nomination for election as directors of those persons
designated by the Designating First Reserve Funds as are entitled to election
to the board of directors of Weatherford pursuant to the provisions of this
Section 5, (ii) have at least one of the designees of the FRC Group serve on
each committee of the board of directors of Weatherford as long as the
Designating First Reserve Funds have designated at least two directors pursuant
to the provisions of this Section 5 and (iii) where two designees of the FRC
Group are serving as directors of Weatherford, have each such designee serve in
different classes of directors. The Designating First Reserve Funds shall
cause their designees on the board of directors of Weatherford to take all
necessary or appropriate action to assist in the nomination for election as
directors of such other nominees as may be selected by a majority of the
directors of Weatherford then in office who were not designated by the
Designating First Reserve Funds, and the FRC Group shall vote all Weatherford
Voting Securities owned of record by any member of the FRC Group, and shall
cause all Weatherford Voting Securities owned beneficially by any member of the
FRC Group to be voted, for the election of such other nominees as well as for
the election of all nominees of the Designating First Reserve Funds designated
by them pursuant to this Section 5.
(f) At any time that one of the Designating First Reserve Funds
does not have a representative serving as a director of Weatherford, an
individual designated by such Designating First Reserve Fund shall have the
right to attend all meetings of the board of directors in a nonvoting observer
capacity, to receive notice of such meetings and to receive the information
provided by Weatherford to its board of directors; provided, however, that
Weatherford may require as a condition precedent to any of such person's rights
under this section that such person agree to hold in confidence and trust and
to act in a fiduciary manner with respect to all information received in
connection with board meetings or otherwise; and, provided further, that
Weatherford reserves the right not to provide information to such person, and
to exclude such person from any meeting or portion thereof, if delivery of such
information or attendance at such meeting would adversely affect the attorney-
client privilege between Weatherford and its counsel. The observer right
provided in this Section 5(f) may be exercised (i) only if (and then only so
long as) the Designating First Reserve Fund has been advised in writing by
counsel to such fund that exercise of this right is reasonably necessary for
such Designating First Reserve Fund to qualify through its investment in
Weatherford as a "venture capital operating company" as such term is defined in
applicable U.S. Department of Labor
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regulations. Notwithstanding the above, the FRC Group agrees to use its
reasonable best efforts to cause the Designating First Reserve Funds to qualify
as a "venture capital operating company" under these regulations without
exercise of its rights under this Section.
(g) Except as set forth in Section 5(e) above in respect of the
election of directors of Weatherford, each member of the FRC Group shall vote
all Weatherford Voting Securities owned of record by any member of the FRC
Group, and shall cause all Weatherford Voting Securities owned beneficially by
any member of the FRC Group to be voted, at the sole election of such members
of the FRC Group, either (i) in accordance with the recommendations of a
majority of the board of directors, or (ii) in the same proportions for,
against and abstaining in respect of any matter as the holders of record of
Weatherford Voting Securities other than those beneficially owned by the FRC
Group that are entitled to vote on such matter vote their Weatherford Voting
Securities.
6. Registration Rights. Weatherford covenants and agrees as follows:
6.1. Definitions. For purposes of this Section 6:
(a) The term "register," "registered" and "registration" refer to
a registration effected by preparing and filing a registration statement in
compliance with the Act.
(b) The term "Registrable Securities" means (i) the Weatherford
Common Stock issuable to the First Reserve Funds as of the Effective Time in
connection with the Merger, and (ii) any Weatherford Common Stock issued as (or
issuable upon the conversion, exchange or exercise of any warrant, right or
other security which is issued as) a dividend or other distribution with
respect to such Weatherford Common Stock; provided, however, that Weatherford
Common Stock sold, transferred or disposed of in accordance with Section 4.2 of
the Agreement to a person to whom registration rights may not be assigned
pursuant to Section 6.13 of the Agreement shall no longer thereafter be
considered Registrable Securities.
(c) The term "Holder" means any member of the FRC Group that
(i) has signed this Agreement and (ii) owns of record Registrable Securities.
(d) The term "Form S-3" means such form under the Act as in effect
on the date hereof or any registration form under the Act subsequently adopted
by the SEC which permits inclusion or incorporation of substantially all the
required information regarding Weatherford by reference to other documents
filed by Weatherford with the SEC.
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6.2. Request for Registration.
(a) If, at any time commencing three months after the Effective
Time of the Merger, Weatherford shall receive a written request from the
Holders of at least 25% of the Registrable Securities then outstanding that
Weatherford file a registration statement under the Act covering the
registration of at least 25% of the Registrable Securities then outstanding (or
a lesser percent if the anticipated aggregate offering price, net of
underwriting discounts and commissions, would exceed $25,000,000), then
Weatherford shall, within 10 days after the receipt thereof, give written
notice of such request to all Holders, and shall, subject to the limitations of
Section 6.2(b), effect as soon as practicable, and in any event within 45 days
after the receipt of such request, the registration under the Act of all
Registrable Securities which the Holders request to be registered within 15
days after the mailing of such notice by Weatherford in accordance with Section
10.3. It is understood that all calculations in this Agreement in respect of a
specified percentage of Registrable Securities then outstanding are to be made
only in respect of the total number of such Registrable Securities, as defined
in Section 6.1(b) above, then outstanding, and not in respect of the total
number of shares of Weatherford Common Stock then outstanding.
(b) If the Holders initiating the registration request hereunder
("Initiating Holders") intend to distribute the Registrable Securities covered
by their request by means of an underwriting, they shall so advise Weatherford
as a part of their request made pursuant to this Section 6.2 and Weatherford
shall include such information in the written notice referred to in subsection
6.2(a). In such event, the right of any Holder to include Registrable
Securities in such registration shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein. All
Holders proposing to distribute Registrable Securities through such
underwriting shall (together with Weatherford as provided in subsection 6.4(e))
enter into an underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting by Xxxxxxxxxxx and reasonably
acceptable to a majority in interest of the Initiating Holders. Xxxxxxxxxxx at
its sole discretion may offer a right to participate in any registration
statement filed pursuant to this Section 6.2 to other stockholders of
Xxxxxxxxxxx Common Stock, and may itself participate in any registration
statement filed pursuant to this Section 6.2 hereof. However, notwithstanding
any other provision of this Section 6.2, if the offering is an underwritten
offering and the lead managing underwriter advises the Initiating Holders in
writing that marketing factors require a limitation of the number of shares of
Xxxxxxxxxxx Common Stock to be underwritten, then the total number of shares of
Common Stock to be
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underwritten shall be reduced, with such reduction coming first from selling
stockholders who are not Holders, and then from Xxxxxxxxxxx. If further
reduction is required, Xxxxxxxxxxx shall so advise all Holders of Registrable
Securities that would have otherwise been underwritten pursuant hereto, and the
number of shares of Registrable Securities that may be included in the
underwriting shall be allocated among all Holders thereof, including the
Initiating Holders, in proportion (as nearly as practicable) to the amount of
Registrable Securities sought to be registered by each Holder.
(c) Xxxxxxxxxxx is obligated to effect only four such
registrations pursuant to this Section 6.2.
(d) Notwithstanding the foregoing, if Xxxxxxxxxxx shall furnish to
Holders requesting a registration statement pursuant to this Section 6.2, a
certificate signed by the President of Xxxxxxxxxxx stating that in the good
faith judgment of a majority of the directors of Xxxxxxxxxxx then in office who
were not designated by the FRC Group, it would be materially detrimental to
Xxxxxxxxxxx for such registration statement to be filed, Xxxxxxxxxxx shall have
the right to defer such filing for a period of not more than 60 days after
receipt of the request of the Initiating Holders; provided, however, that
Xxxxxxxxxxx may not utilize this right more than once in any 12-month period.
6.3. Piggyback Registration. If (but without any obligation to do so)
Xxxxxxxxxxx proposes to register any of its Common Stock under the Act in
connection with the public offering of such Common Stock by Xxxxxxxxxxx solely
for cash (other than a registration relating solely to the sale of securities
to participants in a dividend reinvestment plan, stock plan or employee benefit
plan; a registration relating solely to the issuance of securities in
connection with an acquisition; or a registration on any form which does not
permit inclusion of selling stockholders), or Xxxxxxxxxxx proposes to register
any of its securities on behalf of a holder exercising demand registration
rights similar to those set forth in Section 6.2 above, Xxxxxxxxxxx shall, at
such time, promptly give each Holder written notice of such registration. Upon
the written request of each Holder given within 15 days after mailing of such
notice by Xxxxxxxxxxx in accordance with Section 10.3, Xxxxxxxxxxx shall,
subject to the provisions of Section 6.8, cause to be registered under the Act
all of the Registrable Securities that each such Holder has requested to be
registered.
6.4. Obligations of Xxxxxxxxxxx. Whenever required under this Section
6 to effect the registration of any Registrable Securities, Xxxxxxxxxxx shall,
as expeditiously as reasonably possible:
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(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use its best efforts to cause such
registration statement to become effective, and, upon the request of the
Holders of a majority of the Registrable Securities registered thereunder, keep
such registration statement effective for up to 90 days.
(b) Prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Act with respect to the disposition of all securities covered by such
registration statement.
(c) Furnish to the Holders such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Act, and such other documents as they may reasonably request in order to
facilitate the disposition of Registrable Securities owned by them.
(d) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be reasonably requested by the Holders,
provided that Xxxxxxxxxxx shall not be required to qualify to do business or to
file a general consent to service of process in any such states of
jurisdictions.
(e) In the event of any underwritten public offering, enter into
and perform its obligations under an underwriting agreement, in usual and
customary form, with the underwriters of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(f) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Act of the happening of any event as a
result of which the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and then use its best efforts to promptly correct such statement or
omission. Notwithstanding the foregoing and anything to the contrary set forth
in this Section, each Holder acknowledges that there may occasionally be times
when Xxxxxxxxxxx must suspend the use of the prospectus forming a part of the
registration statement until such time as an amendment to the registration
statement has been filed by Xxxxxxxxxxx and declared effective by the SEC, or
until such time as Xxxxxxxxxxx has filed an appropriate report with the
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SEC pursuant to the Exchange Act. Each Holder hereby covenants that it will
not sell any shares of Common Stock pursuant to said prospectus during the
period commencing at the time at which Xxxxxxxxxxx gives the Holder notice of
the suspension of the use of said prospectus and ending at the time Xxxxxxxxxxx
gives the Holder notice that it may thereafter effect sales pursuant to said
prospectus. Xxxxxxxxxxx shall only be able to suspend the use of said
prospectus for periods aggregating no more than 30 days in respect of any
registration.
6.5 Furnish Information. It shall be a condition precedent to the
obligations of Xxxxxxxxxxx to take any action pursuant to this Section 6 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to Xxxxxxxxxxx such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such
securities as shall be required to affect the registration of such Holder's
Registrable Securities and as may be required from time to time to keep such
registration current.
6.6. Expenses of Demand Registration. All expenses incurred by or on
behalf of Xxxxxxxxxxx in connection with registrations, filings or
qualifications pursuant to Section 6.2, including, without limitation, all
registration, filing and qualification fees, printers' and accounting fees, and
fees and disbursements of counsel for Xxxxxxxxxxx, shall be borne by
Xxxxxxxxxxx; provided, however, that Xxxxxxxxxxx shall not be required to pay
for any expenses of any registration proceeding begun pursuant to Section 6.2
if the registration request is subsequently withdrawn at the request of the
Holders of a majority of the Registrable Securities to be registered (in which
case all participating Holders shall reimburse Xxxxxxxxxxx promptly for all
such reasonable expenses), unless the Holders of a majority of the Registrable
Securities agree to forfeit their right to one demand registration pursuant to
Section 6.2. In no event shall Xxxxxxxxxxx be obligated to bear underwriting
discounts and commissions and the fees and expenses of counsel to the selling
Holders.
6.7. Expenses of Piggyback Registration. Xxxxxxxxxxx shall bear and
pay all expenses incurred by or on behalf of Xxxxxxxxxxx in connection with any
registration, filing or qualification of Registrable Securities with respect to
the registrations pursuant to Section 6.3 for each Holder, including, without
limitation, all registration, filing, and qualification fees, printing and
accounting fees and fees and disbursements of counsel for Xxxxxxxxxxx relating
or allocable thereto, but excluding underwriting discounts and commissions
relating to Registrable Securities and the fees and disbursements of counsel
for the selling Holders.
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6.8. Underwriting Requirements. In connection with any offering
involving an underwriting of shares being issued by Xxxxxxxxxxx, Xxxxxxxxxxx
shall not be required under Section 6.3 to include any of the Holders'
Registrable Securities in such underwriting unless they accept the terms of the
underwriting as agreed upon between Xxxxxxxxxxx and the underwriters selected
by it. If the total amount of securities, including Registrable Securities,
requested by Holders and other stockholders to be included in such offering
exceeds the amount of securities sold other than by Xxxxxxxxxxx that the
underwriters reasonably believe compatible with the success of the offering,
then Xxxxxxxxxxx shall be required to include in the offering only that number
of such securities, including Registrable Securities, which the underwriters
believe will not jeopardize the success of the offering. To achieve any
necessary reduction in the securities to be sold, the securities to be excluded
from the offering shall first be selected (in each case, pro rata among such
class of holders according to the total amount of securities proposed to be
included in the registration statement or in such other proportions as shall
mutually be agreed to by such class of holders) in the following order:
(i) first, securities being included on behalf of holders other than
members of the FRC Group shall be excluded, except as provided in (iii) below;
(ii) next, if additional securities must be excluded, Registrable Securities
included pursuant to Section 6.3 shall be excluded; (iii) thereafter, if
additional securities must be excluded, securities included on behalf of a
holder exercising demand registration rights similar to those set forth in
Section 6.2 shall be excluded, and (iv) finally, if additional securities must
be excluded, securities offered by Xxxxxxxxxxx shall be excluded.
6.9. Delay of Registration. No Holder shall have any right to obtain
or seek an injunction restraining or otherwise delaying any such registration
as the result of any controversy that might arise with respect to the
interpretation or implementation of this Section 6.
6.10. Indemnification. In the event any Registrable Securities are
included in a registration statement under this Section 6:
(a) To the extent permitted by law, Xxxxxxxxxxx will indemnify and
hold harmless each Holder and the affiliates of such Holder, and their
respective directors, officers, general and limited partners, agents and
representatives (and the directors, officers, affiliates and controlling
persons thereof), and each other person, if any, who controls such Holder
within the meaning of the Act or the Exchange Act, against any losses, claims,
damages, or liabilities (joint or several) to which they may become subject
under the Act, the Exchange Act or other federal or state law, insofar as such
losses, claims, damages, or liabilities (or actions in respect thereof) arise
out of or are
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based upon any of the following statements, omissions or violations
(collectively a "Violation"): (i) any untrue statement or alleged untrue
statement of a material fact contained in such registration statement,
including any preliminary prospectus (but only if such is not corrected in the
final prospectus) contained therein or any amendments or supplements thereto,
(ii) the omission or alleged omission to state therein a material fact required
to be stated therein, or necessary to make the statements therein not
misleading (but only if such is not corrected in the final prospectus), or
(iii) any violation or alleged violation by Xxxxxxxxxxx in connection with the
registration of Registrable Securities under the Act, the Exchange Act, any
state securities law or any rule or regulation promulgated under the Act, the
Exchange Act or any state securities law; and Xxxxxxxxxxx will pay to each such
Holder, affiliate or controlling person, as incurred, any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability, or action; provided,
however, that the indemnity agreement contained in this Section 6.10(a) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability, or action if such settlement is effected without the consent of
Xxxxxxxxxxx (which consent shall not be unreasonably withheld), nor shall
Xxxxxxxxxxx be liable in any such case for any such loss, claim, damage,
liability, or action to the extent that it arises out of or is based upon a
violation which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such registration by
any such Holder or controlling person.
(b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless Xxxxxxxxxxx, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls Xxxxxxxxxxx within the meaning of the Act, any underwriter, any other
Holder selling securities in such registration statement and any controlling
person of any such underwriter or other Holder, against any losses, claims,
damages, or liabilities (joint or several) to which any of the foregoing
persons may become subject, under the Act, the Exchange Act or other federal or
state law, insofar as such losses, claims, damages, or liabilities (or actions
in respect thereto) arise out of or are based upon any Violation, in each case
to the extent (and only to the extent) that such Violation occurs in reliance
upon and in conformity with written information furnished by such Holder
expressly for use in connection with such registration; and each such Holder
will pay, as incurred, any legal or other expenses reasonably incurred by any
person intended to be indemnified pursuant to this subsection 6.10(b), in
connection with investigating or defending any such lose, claim, damage,
liability, or action; provided, however, that the indemnity agreement contained
in this subsection 6.10(b) shall not apply to amounts paid in settlement of any
such loss,
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claim, damage, liability or action if such settlement is effected without the
consent of the Holder, which consent shall not be unreasonably withheld;
provided, that, in no event shall any indemnity under this Section 6.10(b)
exceed the gross proceeds from the offering received by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 6.10 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 6.10,
deliver to the indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties. The failure to deliver written notice to the
indemnifying party within a reasonable time after the commencement of any such
action, if materially prejudicial to its ability to defend such action, shall
relieve such indemnifying party of any liability to the indemnified party under
this Section 6.10, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it may have to any
indemnified party otherwise than under this Section 6.10. The indemnified party
shall have the right, but not the obligation, to participate in the defense of
any action referred to above through counsel of its own choosing and shall have
the right, but not the obligation, to assert any and all separate defenses,
cross claims or counterclaims which it may have, and the fees and expenses of
such counsel shall be at the expense of such indemnified party unless (i) the
employment of such counsel has been specifically authorized in advance by the
indemnifying party, (ii) there is a conflict of interest that prevents counsel
for the indemnifying party from adequately representing the interests of the
indemnified party, (iii) the indemnifying party does not employ counsel that is
reasonably satisfactory to the indemnified party, or (iv) the indemnifying
party fails to assume the defense or does not reasonably contest such action in
good faith, in which case, if the indemnified party notifies the indemnifying
party that it elects to employ separate counsel, the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party and the reasonable fees and expenses of such separate counsel
shall be borne by the indemnifying party; provided, however, that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm (in addition to any local counsel) for
all indemnified parties.
(d) The obligations of Xxxxxxxxxxx and the Holders under this
Section 6.10 shall survive the completion of
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any offering of Registrable Securities in a registration statement under this
Section 6.
6.11. Reports Under the Exchange Act. With a view to making available
to the Holders the benefits of Rule 144 and any other rule or regulation of the
SEC that may at any time permit a Holder to sell securities of Xxxxxxxxxxx to
the public without registration or pursuant to a registration on Form X-0,
Xxxxxxxxxxx agrees to:
(a) use its best efforts to make and keep public information
available, as those terms are understood and defined in Rule 144;
(b) use its best efforts to file with the SEC in a timely manner
all reports and other documents required under the Act and the Exchange Act;
and
(c) furnish to any Holder forthwith upon request (i) a written
statement by Xxxxxxxxxxx as to its compliance with the reporting requirements
of Rule 144, or as to whether it qualifies as a registrant whose securities may
be resold pursuant to Form S-3, (ii) a copy of the most recent annual or
quarterly report of Xxxxxxxxxxx and such other reports and documents so filed
by Xxxxxxxxxxx, and (iii) such other information as may be reasonably requested
in availing any Holder of any rule or regulation of the SEC which permits the
selling of any such securities without registration or pursuant to such form.
6.12. Form S-3 Registration. In case Xxxxxxxxxxx shall receive from
any Holder or Holders of at least 10% of the Registrable Securities then
outstanding (or a lesser percent if the anticipated aggregate offering price,
net of discounts and commissions, would exceed $1,000,000) a written request or
requests that Xxxxxxxxxxx effect a registration on Form S-3 not involving an
underwriting and any related qualification or compliance with respect to all or
a part of the Registrable Securities owned by such Holder or Holders,
Xxxxxxxxxxx will:
(a) promptly give written notice of the proposed registration, and
any related qualification or compliance, to all other Holders; and
(b) as soon as practicable, effect such registration and all such
qualifications and compliances as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of such Holder's or
Holders' Registrable Securities as are specified in such request, together with
all or such portion of the Registrable Securities of any other Holder or
Holders joining in such request as are specified in a written request given
within 15 days after receipt of such written notice from Xxxxxxxxxxx; provided,
however, that
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Xxxxxxxxxxx shall not be obligated to effect any such registration,
qualification or compliance, pursuant to this Section 6.12: (1) if Form S-3 is
not available for such offering by the Holders; (2) if the Holders, together
with the holders of any other securities of Xxxxxxxxxxx entitled to include
securities in such registration, propose to sell Registrable Securities and
such other securities (if any) at an aggregate price to the public (net of any
discounts or commissions) of less than $1,000,000; (3) if Xxxxxxxxxxx shall
furnish to the Holders a certificate signed by the President of Xxxxxxxxxxx
stating that in the good faith judgment of a majority of the directors of
Xxxxxxxxxxx then in office who were not designated by the FRC Group, it would
be materially detrimental to Xxxxxxxxxxx for such Form S-3 Registration to be
effected at such time, in which event Xxxxxxxxxxx shall have the right to defer
the filing of the Form S-3 registration statement for a period of not more than
60 days after receipt of the request of the Holder or Holders under this
Section 6.12; provided, however, that Xxxxxxxxxxx shall not utilize this right
more than once in any 12-month period; (4) if Xxxxxxxxxxx has, within the
12-month period preceding the date of such request, already effected a
registration on Form S-3 for the Holders pursuant to this Section 6.12; or (5)
in any particular jurisdiction in which Xxxxxxxxxxx would be required to
qualify to do business or to execute a general consent to service of process in
effecting such registration, qualification or compliance.
(c) Subject to the foregoing, Xxxxxxxxxxx shall file a
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders. All expenses incurred by or on behalf of
Xxxxxxxxxxx in connection with the registrations requested pursuant to Section
6.12, including (without limitation) all registration, filing, qualification,
printer's and accounting fees and the fees and disbursements of counsel for
Xxxxxxxxxxx, shall be borne by Xxxxxxxxxxx, except that any discounts or
commissions associated with Registrable Securities and the fees and
disbursements of counsel for the selling Holder or Holders shall be borne by
the Holder or Holders participating in the Form S-3 Registration.
Registrations effected pursuant to this Section 6.12 shall not be counted as
demands for registration or registrations effected pursuant to Sections 6.2.
6.13. No Assignment of Registration Rights. The rights to cause
Xxxxxxxxxxx to register Registrable Securities pursuant to this Section 6 may
only be assigned by a Holder to a transferee or assignee of any Registrable
Securities if (i) such transferee or assignee is a member of the FRC Group that
has executed this Agreement, and (ii) immediately following such transfer the
further disposition of such securities by the transferee or assignee is
restricted under the Act.
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6.14. Limitations on Subsequent Registration Rights. From and after
the date of this Agreement, Xxxxxxxxxxx shall not, without the prior
written consent of the Holders of a majority of the outstanding Registrable
Securities (or, prior to the Effective Time of the Merger, without the prior
written consent of FRC), enter into any agreement with any holder or
prospective holder of any securities of Xxxxxxxxxxx which would allow such
holder or prospective holder to include such securities in any registration
filed under Sections 6.2 or 6.3 hereof, unless under the terms of such
agreement, such holder or prospective holder may include such securities in any
such registration only to the extent that the inclusion of its securities will
not reduce the amount of the Registrable Securities of the Holders which is
included.
6.15. Waiver Procedures. The observance by Xxxxxxxxxxx of any
provision of this Section 6 may be waived (either generally or in a particular
instance and either retroactively or prospectively) with the written consent of
the holders of a majority of the Registrable Securities then outstanding, and
any waiver effected in accordance with this paragraph shall be binding upon
each Holder of Registrable Securities.
6.16. "Market Stand-off" Agreement. Any Holder of Registrable
Securities, if requested by an underwriter of any registered public offering of
Xxxxxxxxxxx securities being sold in a firm commitment underwriting, agrees not
to sell or otherwise transfer or dispose of any Common Stock (or other
Xxxxxxxxxxx voting Securities) held by such Holder other than shares of
Registrable Securities included in the registration, during a period of up to
90 days following the effective date of the registration statement, provided
that all other persons selling securities in such underwritten public offering
and all officers and directors of Xxxxxxxxxxx shall enter into similar
agreements. Such agreement shall be in writing in the form reasonably
satisfactory to Xxxxxxxxxxx and such underwriter. Xxxxxxxxxxx may impose
stop-transfer instructions with respect to the securities subject to the
foregoing restriction until the end of the required stand-off period.
Section 7. Term of Agreement; Certain Provisions Regarding Termination.
(a) Except as otherwise provided in (b) below, the respective
covenants and agreements of the FRC Group and Xxxxxxxxxxx contained in this
Agreement will continue in full force and effect until the Termination Date,
and all of the representations and warranties set forth herein shall be
continuing representations and warranties. Upon the Termination Date, all of
the obligations of Xxxxxxxxxxx and the FRC Group hereunder shall terminate,
except solely the obligations of the
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parties pursuant to Section 6.10 in respect of registrations completed prior to
the Termination Date.
(b) If the FRC Group shall, at any time, sell or otherwise dispose
of Xxxxxxxxxxx Voting Securities in compliance with the terms and provisions of
this Agreement so that the FRC Group beneficially owns in the aggregate shares
representing less than 10% of the Combined Voting Power, all covenants,
agreements, obligations and rights of the FRC Group and Xxxxxxxxxxx contained
in Sections 4.2 (except that no single sale, transfer of any beneficial
interest in or other disposition of Xxxxxxxxxxx Voting Securities, and no
related group of such sales, transfers or dispositions, shall be made by the
FRC Group if such sales, transfers or dispositions (i) involve such number of
Xxxxxxxxxxx Voting Securities as represent 5% or more of the Combined Voting
Power, or (ii) are to or with any one person or related group of persons who,
upon consummation of such sale, transfer or disposition have beneficial
ownership of such number of Xxxxxxxxxxx Voting Securities as represent 10% or
more of the Combined Voting Power), 4.3, 4.4, 4.5, 4.7, 5, 6 and 8 hereof shall
cease until such time as the FRC Group shall again purchase or otherwise
acquire beneficial ownership of Xxxxxxxxxxx Voting Securities representing 10%
or more of the Combined Voting Power. From and after such times as the FRC
Group beneficially owns in the aggregate Xxxxxxxxxxx Voting Securities
representing 10% or more of the Combined Voting Power, all restrictions upon
and covenants of the FRC Group and Xxxxxxxxxxx set forth in this Agreement
shall again be applicable until the Termination Date. All percentages in this
Section shall be calculated in accordance with the provisions of Section 4.1.
Section 8. Legend and Stop Transfer Order. To assist in effectuating
the provisions of this Agreement, the FRC Group hereby consents (i) to the
placement, in connection with the Merger or otherwise within 10 business days
after any Xxxxxxxxxxx Voting Securities become subject to the provisions of
this Agreement, of the following legend on all certificates representing
ownership of Xxxxxxxxxxx Voting Securities owned of record by any member of the
FRC Group or by any person where a member of the FRC Group is the beneficial
owner thereof, until such shares are sold, transferred or disposed in a manner
permitted hereby to a person who is not then a member of the FRC Group:
The shares represented by this certificate are subject to the provisions
of an Agreement among Xxxxxxxxxxx Corporation, First Reserve Corporation
and certain limited partnerships under control of or common control with
First Reserve Corporation, and may not be sold, transferred, pledged,
hypothecated or otherwise disposed of except in accordance
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therewith. Copies of said Agreement are on file at the office of the
Corporate Secretary of Xxxxxxxxxxx Corporation.
; and (ii) to the entry of stop transfer orders with the transfer agent or
agents of Xxxxxxxxxxx Voting Securities against the transfer of Xxxxxxxxxxx
Voting Securities except in compliance with the requirements of this Agreement,
or if Xxxxxxxxxxx acts as its own transfer agent with respect to any
Xxxxxxxxxxx Voting Securities, to the refusal by Xxxxxxxxxxx to transfer any
such securities except in compliance with the requirements of this Agreement.
Xxxxxxxxxxx agrees to remove promptly all legends and stop transfer orders with
respect to the transfer of Xxxxxxxxxxx Voting Securities being made to a person
who is not then a member of the FRC Group in compliance with the provisions of
this Agreement.
Section 9. Remedies.
(a) The FRC Group acknowledges and agrees that (i) the provisions
of this Agreement are reasonable and necessary to protect the proper and
legitimate interests of the parties hereto, and (ii) Xxxxxxxxxxx and the FRC
Group would be irreparably damaged in the event any of the provisions of this
Agreement were not performed by the other parties hereto in accordance with
their specific terms or were otherwise breached. It is accordingly agreed that
the non-breaching party shall be entitled to preliminary and permanent
injunctive relief to prevent breaches of the provisions of this Agreement,
without the necessity of proving actual damages or of posting any bond, and to
enforce specifically the terms and provisions hereof and thereof in any court
of the United States or any state thereof having jurisdiction, which rights
shall be cumulative and in addition to any other remedy to which such
non-breaching party may be entitled hereunder or at law or equity.
(b) In addition to any other remedy Xxxxxxxxxxx may have under
this Agreement or in law or equity, if the FRC Group shall acquire or transfer
any Weatherford Voting Securities in violation of this Agreement, such
Weatherford Voting Securities which are in excess of the number permitted to be
owned or controlled by the FRC Group or which have been transferred by the FRC
Group in violation of the provisions of this Agreement may not be voted by the
owner thereof or any proxy therefor.
10. General Provisions.
10.1. Consent to Jurisdiction; Service of Process. THIS AGREEMENT SHALL
BE GOVERNED BY AND INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAW PROVISIONS.
EACH OF THE
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PARTIES IRREVOCABLY AND UNCONDITIONALLY (A) AGREES THAT ANY SUIT, ACTION OR
OTHER LEGAL PROCEEDING (COLLECTIVELY, "SUIT") ARISING OUT OF THIS AGREEMENT
SHALL BE BROUGHT AND ADJUDICATED IN THE UNITED STATES DISTRICT COURT FOR
DELAWARE, OR, IF SUCH COURT WILL NOT ACCEPT JURISDICTION, IN ANY COURT OF
COMPETENT CIVIL JURISDICTION SITTING IN NEW CASTLE COUNTY, DELAWARE, (B)
SUBMITS TO THE JURISDICTION OF ANY SUCH COURT FOR THE PURPOSES OF ANY SUCH SUIT
AND (C) WAIVES AND AGREES NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR
OTHERWISE IN ANY SUCH SUIT, ANY CLAIM THAT IT IS NOT SUBJECT TO THE
JURISDICTION OF THE ABOVE COURTS, THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT
FORUM OR THAT THE VENUE OF SUCH SUIT TO IMPROPER. EACH OF THE PARTIES ALSO
IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO THE SERVICE OF ANY PROCESS,
PLEADINGS, NOTICES OR OTHER PAPERS IN A MANNER PERMITTED BY THE NOTICE
PROVISIONS OF SECTION 10.3 HEREOF.
10.2. Joint and Several Obligations. All of the obligations of the FRC
Group hereunder shall be joint and several. Each member of the FRC Group that
shall become or have the right to become the beneficial owner, within the
meaning and scope of Section 4.1 hereof, of Weatherford Voting Securities
shall, within 10 days of becoming such owner or holder, execute and deliver to
Weatherford a joinder agreement, agreeing to be legally bound by this Agreement
to the same extent as if named as a member of the FRC Group herein.
10.3. Notices. All notices, consents, requests, instructions,
approvals and other communications provided for herein and all legal process in
regard hereto shall be in writing and shall be decreed to be validly given,
made or served when delivered personally or deposited in the U.S. mail, postage
prepaid, for delivery by express, registered or certified mail, or delivered to
a recognized overnight courier service, addressed as follows:
If to Weatherford:
Xxxxxxxxxxx International Incorporated
0000 Xxxx Xxx Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attn: Chairman, President and
Chief Executive Officer
With a required copy to:
Fulbright & Xxxxxxxx L.L.P.
0000 XxXxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
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If to any member of the First Reserve Group:
First Reserve Corporation
000 Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Attn: President and Chief Executive Officer
With a required copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxxxx X. Xxxxxxxx, Esq.
or to such other address as may be specified on a notice given pursuant to this
Section 10.3.
10.4. Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
void, or unenforceable, the remainder of the terms, provisions, covenants and
restrictions shall remain in full force and effect and shall in no way be
affected, impaired or invalidated. The parties agree that they will use their
best efforts at all times to support and defend this Agreement.
10.5. Amendments. This Agreement may be amended only by an agreement
in writing signed by each of the parties hereto; provided, however, that any
amendment executed by Weatherford must prior thereto be approved by a majority
of the directors of Weatherford then in office who were not designated by the
FRC Group.
10.6. Descriptive Headings. Descriptive headings are for convenience
only and shall not control or affect the meaning or construction of any
provision of this Agreement.
10.7. Counterparts. This Agreement shall become binding when one or
more counterparts hereof, individually or taken together, bears the signatures
of each of the parties hereto. This Agreement may be executed in any number of
counterparts, each of which shall be an original as against the party whose
signature appears thereon, or on whose behalf such counterpart is executed, but
all of which taken together shall be one and the same statement.
10.8. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the successors and assigns of the
parties hereto.
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IN WITNESS WHEREOF, the parties hereto intending to be legally bound
have duly executed this Agreement, all as of the day and year first above
written.
XXXXXXXXXXX INTERNATIONAL
INCORPORATED
By: /s/ Xxxxxx Xxxxxxxxxx
---------------------
Xxxxxx Xxxxxxxxxx
Chairman, President and
Chief Executive Officer
FIRST RESERVE CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------
Xxxxxxx X. Xxxxxxxx
President and Chief
Executive Officer
NUMBER OF SHARES OF FIRST RESERVE FUNDS:
ENTERRA COMMON STOCK
HELD ON THE DATE HEREOF:
1,993,529 AMERICAN GAS & OIL INVESTORS,
LIMITED PARTNERSHIP
1,233,907 AMGO II, LIMITED PARTNERSHIP
597,408 AMGO III, LIMITED PARTNERSHIP
2,323,562 FIRST RESERVE SECURED ENERGY ASSETS
FUND, LIMITED PARTNERSHIP
3,355,254 FIRST RESERVE FUND V, LIMITED
PARTNERSHIP
838,427 FIRST RESERVE FUND V-2, LIMITED
PARTNERSHIP
870,262 FIRST RESERVE FUND VI, LIMITED
PARTNERSHIP
By: FIRST RESERVE CORPORATION,
Managing General Partner
of each of the First Reserve
Funds
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------
Xxxxxxx X. Xxxxxxxx
President and
Chief Executive Officer
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