AMENDMENT NO. 1 TO PURCHASE AGREEMENT
THIS AMENDMENT NO. 1 TO PURCHASE AGREEMENT (the "AMENDMENT") is dated
as of August 30, 2001 and is by and among SCHLUMBERGER TECHNOLOGY
CORPORATION, a Texas corporation ("STC"), CAMCO INTERNATIONAL INC., a
Delaware corporation ("CII"), SCHLUMBERGER SURENCO S.A., a Panamanian company
("SURENCO"), and SCHLUMBERGER OILFIELD HOLDINGS LTD., a British Virgin
Islands company ("XXXX" and together with STC, CII and Surenco, each a
"SELLER" and, collectively, the "SELLERS" or "SCHLUMBERGER"), HANOVER
COMPRESSOR COMPANY, a Delaware corporation ("HANOVER"), and HANOVER
COMPRESSION LIMITED PARTNERSHIP, a Delaware limited partnership
("PURCHASER"). Terms used and not defined herein shall have the meanings
assigned to them in the Purchase Agreement dated June 28, 2001, by and among
STC, CII, Surenco, XXXX, Hanover and Purchaser (the "PURCHASE AGREEMENT").
RECITALS
A. WHEREAS, the Sellers, Hanover and Purchaser entered into the
Purchase Agreement on June 28, 2001; and
B. WHEREAS, the Sellers, Hanover and Purchaser desire to amend
the Purchase Agreement as set forth in this Amendment to reflect their
agreement to exclude the Rocky Mountain Assets from the transaction and to
reference their agreement regarding the contracts and other documents listed
on Schedule 1.5(a) hereto.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the Sellers, Hanover and Purchaser hereby agree as follows:
1. Section 1.1 of the Purchase Agreement is amended and restated
to read in its entirety as follows:
1.1 PURCHASE AND SALE. Subject to the terms and conditions
hereof, Purchaser and/or one or more of its Affiliates shall
purchase: (i)100% of the issued and outstanding shares (the "POC
SHARES") of the capital stock of Production Operators Corporation, a
Delaware corporation ("POC"), from CII, (ii) a 35.5% equity interest
in and a $7,952,000 loan to (the "HARWAT INTEREST") Harwat
International Finance N.V., a Curacao limited liability company
("HARWAT"), from XXXX, (iii)a 30% equity interest in and a
$79,185,000 loan to ("WILPRO INTEREST") WilPro Energy Service
(PIGAPII) Limited, a Cayman Islands company ("WILPRO"), from Surenco,
and (iv)the contracts and other assets of Operational Services,
Inc.'s Mechanical Services Group listed on Exhibit1.1A (the "OSI
ASSETS"). In addition, STC, XXXX and Purchaser shall enter into the
Alliance Agreement. The consummation of the transactions
contemplated in this Section1.1 shall be referred to herein as the
"Closing".
2. Section 1.2(a) of the Purchase Agreement is amended and
restated to read in its entirety as follows:
(a) Subject to the terms and conditions hereof, and
subject to the adjustments specified in Section1.3 hereof, the
aggregate amount (the "Aggregate Purchase Price") paid by Hanover for
the Schlumberger Equity Interests, the OSI Assets, and the Alliance
Agreement, which shall be allocated by the Parties in accordance with
Section1.2(c), shall consist of: (i)the following amounts paid at
Closing: (A)Two Hundred Seventy Million Dollars ($270,000,000) in
cash, (B)One Hundred Fifty Million Dollars ($150,000,000) in the form
of a subordinated promissory note having the terms set forth on the
Term Sheet attached hereto as Exhibit1.2 (the "Hanover Note") and
(C)a number of shares of Hanover common stock ("Hanover Stock")
having a value (without giving effect to any restrictions on
transfer) of Two Hundred Eighty Three Million Dollars ($283,000,000),
as provided in Section1.2(b), and (ii)upon any draw down on a
financing of the PIGAPII project owned by WilPro, the net amount of
the draw down multiplied by 30% until an aggregate of Fifty Eight
Million Dollars($58,000,000) in cash has been paid to Surenco.
3. Section 4.11 of the Purchase Agreement is amended and
restated to read in its entirety as follows:
4.11 SALE OF OSI ASSETS. Sellers agree that Sellers
and/or one of their Affiliates shall sell the OSI Assets to Purchaser
and/or one of its Affiliates on the Closing Date, all on terms and
conditions (other than price, which is set forth on SCHEDULE 1.2(c)
hereof) reasonably satisfactory to the Parties.
4. Section 5.13 of the Purchase Agreement is amended and
restated to read in its entirety as follows:
5.13 PURCHASE OF OSI MECHANICAL SERVICES GROUP. Purchaser agrees
that Purchaser and/or one of its Affiliates shall buy the OSI Assets
on the Closing Date, all on terms and conditions (other than price,
which is set forth on SCHEDULE 1.2(c) hereof) reasonably satisfactory
to the Parties.
5. Section 5.15 of the Purchase Agreement is amended and
restated to read in its entirety as follows:
5.15 DESIGNATION OF PURCHASING ENTITIES. Purchaser shall,
as soon as practicable and in no event more than three days after the
date hereof, notify the Sellers of the identity of the purchasing
entity with respect to the POC Companies, the WilPro Interest, the
Harwat Interest and the OSI Assets. Hanover Cayman, Limited, a
Cayman Islands company that is wholly owned by Purchaser, shall be
the buyer of the WilPro Interest. The Sellers agree that, up to ten
days prior to the Closing, the Purchaser may change these purchasing
entities, subject to the Sellers consent (which will not be
unreasonably withheld).
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6. The lead in to Article VI of the Purchase Agreement is
amended and restated to read in its entirety as follows:
The obligations of Purchaser to purchase the Schlumberger
Equity Interests and the OSI Assets and complete the Closing at the
Closing Date are, at the option of Purchaser, subject to satisfaction
of each of the following conditions precedent on or before the
Closing Date (Purchaser and Hanover agree that there is no financing
or board approval conditions to their obligations to purchase the POC
Shares, the Harwat Interest or the WilPro Interest at the Closing
Date):
7. The lead in to Article VII of the Purchase Agreement is
amended and restated to read in its entirety as follows:
The obligation of each Seller, as applicable, to sell the
Schlumberger Equity Interests and the OSI Assets and complete the
Closing at the Closing Date are, at the option of each Seller,
subject to the satisfaction of each of the following conditions
precedent on or before the Closing Date:
8. Section 8.2(o) of the Purchase Agreement is amended and
restated to read in its entirety as follows:
(o) An executed copy of an asset purchase agreement
effecting the sale of the OSI Assets.
9. Section 8.3 (o) of the Purchase Agreement is amended and
restated to read in its entirety as follows:
(o) An executed copy of an asset purchase agreement
effecting the purchase of the OSI Assets and an executed copy of a
stock purchase agreement effecting the purchase of the Guara Interest.
10. The definition of "Excluded Assets" as set forth in Appendix
I to the Purchase Agreement is amended and restated to read in its entirety
as follows:
"Excluded Assets" shall mean the assets of the POC Entities
which are not to be acquired by Purchaser and which are set forth on
SCHEDULE 1.4 hereto, including, without limitation, the assets set
forth on SCHEDULE 1.4(a) hereto.
11. The definition of "Related Agreement" as set forth in
Appendix I to the Purchase Agreement is amended and restated to read in its
entirety as follows:
"Related Agreement" shall mean the asset purchase agreement
entered into at Closing by the Parties or their respective Affiliates
relating to the acquisition of the OSI Assets.
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12. Schedule 1.5 to the Purchase Agreement is amended by
inserting the following after the phrase "4. The balances shown for the
obligations listed on the attached schedule are in USD (000's) as of May 31,
2001 and represent primarily benefit and tax obligations of Schlumberger" :
"5. Any Liability arising from or relating to the assets on
Schedule 1.4(a); and
6. Any Liability arising on or prior to the Closing Date
relating to the agreements set forth in SCHEDULE 1.5(a) or to the
agreements being assigned pursuant to any agreement set forth on
SCHEDULE 1.5(a)."
13. The definition of Target Net Worth is amended and restated to
read in its entirety as follows:
"Target Net Worth" is equal to the sum of (i) $489,861,833,
which is based on the unaudited financials for the Schlumberger
Equity Interests, excluding (except as set forth in SCHEDULE 1.3(i)
and SCHEDULE 1.3(j)) the Excluded Assets and the Excluded
Liabilities, as of May 31, 2001 and (ii) any gain in excess of
$100,000 realized after May 31, 2001 by the POC Entities in
connection with the termination or cancellation of any customer
contracts.
14. SCHEDULE 1.4(a) to the Purchase Agreement is attached hereto.
15. SCHEDULE 1.5(a) to the Purchase Agreement is attached hereto.
16. The Purchase Agreement, as amended by this Amendment, and all
documents and instruments referred to in the Purchase Agreement constitute
the complete agreement of the Parties with respect to the subject matter
hereof and supercede all prior discussions, negotiations and understandings,
both written and oral.
17. The laws of the State of Texas shall govern the
interpretation, validity and performance of the terms of this Amendment,
regardless of the law that might be applied under principles of conflicts of
law.
18. This Amendment may be executed in counterparts, each of which
shall be deemed an original, but all of which together shall constitute one
and the same instrument.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed and delivered on August 30, 2001.
SCHLUMBERGER TECHNOLOGY CORPORATION SCHLUMBERGER SURENCO S.A.
By: ________________________________ By: ________________________________
Name: ______________________________ Name: ______________________________
Title: ______________________________ Title: ______________________________
HANOVER COMPRESSOR COMPANY SCHLUMBERGER OILFIELD HOLDINGS LTD.
By: ________________________________ By: ________________________________
Name: ______________________________ Name: ______________________________
Title: ______________________________ Title: ______________________________
HANOVER COMPRESSION LIMITED PARTNERSHIP CAMCO INTERNATIONAL, INC.
By: ________________________________ By: ________________________________
Name: ______________________________ Name: ______________________________
Title: ______________________________ Title: ______________________________
