EXHIBIT 4.1
REGISTRATION RIGHTS AGREEMENT
BY AND AMONG
SCHLUMBERGER TECHNOLOGY CORPORATION
AND
GRANT PRIDECO, INC.
DECEMBER 20, 2002
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT dated as of December 20, 2002,
among Grant Prideco, Inc., a Delaware corporation (the "Company"), Schlumberger
Technology Corporation, a Texas corporation ("Seller").
WITNESSETH:
WHEREAS, pursuant to a Purchase Agreement, dated as of October
25, 2002 (the "Purchase Agreement"), by and among the Company and the Holders
(as hereafter defined), the Holders acquired 9,731,834 shares of Common Stock
(as hereafter defined).
WHEREAS, the parties hereto desire to set forth the rights of
the Holders (as hereinafter defined) and the obligations of the Company with
respect to the registration of the Registrable Securities (as hereafter defined)
pursuant to the Securities Act (as hereafter defined); and
WHEREAS, the execution and delivery of this Agreement by the
parties hereto is a condition to the obligations of each of the Holders and the
Company under the Purchase Agreement;
NOW, THEREFORE, in consideration of the covenants and
agreements of the Holders and the Company contained herein and in the Purchase
Agreement and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
Capitalized terms used but not otherwise defined herein shall have the
meanings assigned to such terms in the Purchase Agreement. For purposes of this
Agreement the following terms shall have the following meanings:
Section 1.1 Affiliate. "Affiliate" of any Person means any entity that
controls, is controlled by, or is under common control with such Person. As used
herein, "control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of such entity,
whether through ownership of voting securities or other interests, by contract
or otherwise.
Section 1.2 Common Stock. "Common Stock" means the shares of common
stock, par value $0.01 per share, of the Company.
Section 1.3 Continuously Effective. "Continuously Effective," with
respect to a specified Registration Statement, means that such Registration
Statement shall not cease to be effective and available for transfers of
Registrable Securities in accordance with the method of
distribution set forth therein during the period specified, subject to
applicable blackout periods, in the relevant provision of this Agreement.
Section 1.4 Exchange Act. "Exchange Act" means the Securities Exchange
Act of 1934, as amended from time to time, and the rules and regulations
thereunder.
Section 1.5 Holders. "Holders" means, collectively, Seller and its
affiliates (other than the Company) who from time to time own Registrable
Securities or any transferee of a Holder entitled to the benefits of this
Agreement; each of such entities separately is sometimes referred to herein as a
"Holder."
Section 1.6 Maximum Number. "Maximum Number" when used in connection
with an underwritten offering, shall mean the maximum number of shares of Common
Stock (or amount of other Registrable Securities) that the Underwriters'
Representative has informed the Company and the Holders may be included as part
of such offering without materially and adversely affecting the success or
pricing of such offering.
Section 1.7 Person. "Person" shall mean any natural person, firm,
individual, corporation, partnership, limited liability company, joint venture,
business trust, association, trust, company or other organization or entity,
whether incorporated or unincorporated.
Section 1.8 Prospectus. "Prospectus" means the prospectus included in a
Registration Statement, as amended or supplemented by any prospectus supplement
with respect to the terms of the offering of any portion of the Registrable
Securities covered by such Registration Statement and by all other amendments
and supplements to the prospectus, including post-effective amendments and all
material incorporated by reference in such prospectus.
Section 1.9 Purchase Agreement. "Purchase Agreement" has the meaning
set forth in the recitals of this Agreement.
Section 1.10 Registrable Securities. "Registrable Securities" means,
collectively, (i) the shares of Common Stock acquired by the Holders pursuant to
the Purchase Agreement (the "Shares"), (ii) any stock or other securities (of
the Company or any other issuer) into which or for which the Shares may
hereafter be changed, converted or exchanged, (iii) any other securities issued
or distributed in respect of the Shares by way of stock dividend or stock split
or in connection with a combination of shares, recapitalization, reorganization,
merger, consolidation or otherwise, and (iv) any other successor securities
received in respect of any of the foregoing (i) through (iii).
Section 1.11 Registration Expenses. "Registration Expenses" means any
and all out-of-pocket expenses incident to performance of or compliance with
this Agreement, including, without limitation, (i) all SEC and securities
exchange registration and filing fees, (ii) all fees and expenses of complying
with securities or blue sky laws (including fees and disbursements of counsel
for any underwriters in connection with blue sky qualifications of the
Registrable Securities) or relating to the National Association of Securities
Dealers, Inc. (the "NASD"), (iii)
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all printing, messenger and delivery expenses, (iv) all fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange pursuant to Section 7(h), (v) the fees and disbursements of
counsel for the Company and of its independent public accountants, (vi) all
expenses in connection with the preparation, printing and filing of the
Registration Statement, any preliminary Prospectus or final Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to any Holders, underwriters and dealers and all expenses incidental to
delivery of the Registrable Securities, (vii) subject to the limitations set
forth in Section 8, the reasonable fees and disbursements of counsel, other than
the Company's counsel, selected by the Holders of the Registrable Securities
being registered, (viii) the reasonable fees and expenses of any special experts
retained in connection with the requested registration, (ix) any internal
expenses of the Company and cost of Company employees, (x) the expenses incurred
in connection with making "roadshow" presentations and holding meetings with
potential investors to facilitate the distribution and sale of Registrable
Securities, but shall not include with respect to Registrable Securities sold by
the Holders (a) underwriting discounts and commissions and transfer taxes, if
any, and (b) any fees and disbursements of underwriters customarily paid by the
issuers or sellers of securities.
Section 1.12 Registration Statement. "Registration Statement" means any
registration statement of the Company which covers Registrable Securities
pursuant to the provisions of this Agreement, including the Prospectus,
amendments and supplements to such registration statements including
post-effective amendments, and all exhibits and all material incorporated by
reference in such Registration Statement.
Section 1.13 Related Securities. "Related Securities" means any
securities of the Company similar or identical to any of the Registrable
Securities including, without limitation, Common Stock and all options,
warrants, rights and other securities convertible into, or exchangeable or
exercisable for Common Stock (other than any of the foregoing to be offered or
sold to officers, directors or employees as compensation).
Section 1.14 Securities Act. "Securities Act" means the Securities Act
of 1933, as amended from time to time, and the rules and regulations thereunder.
Section 1.15 SEC. "SEC" means the Securities and Exchange Commission.
Section 1.16 Underwritten Registration or Underwritten Offering.
"Underwritten Registration or Underwritten Offering" shall mean a registration
in which securities of the Company are sold to one or more underwriters for
reoffering to the public.
Section 1.17 Underwriters' Representative. "Underwriters'
Representative" when used in connection with an Underwritten Offering, shall
mean the managing underwriter of such offering, or, in the case of a co-managed
underwriting, the managing underwriter designated as the Underwriters'
Representative by the co-managers.
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ARTICLE II
SECURITIES SUBJECT TO THIS AGREEMENT
The securities entitled to the benefits of this Agreement are the
Registrable Securities. For the purposes of this Agreement, Registrable
Securities will cease to be Registrable Securities when (i) a Registration
Statement covering such Registrable Securities has been declared effective under
the Securities Act and they have been disposed of pursuant to such effective
Registration Statement, (ii) such Registrable Securities are distributed to the
public pursuant to Rule 144 (or any similar provision then in force) under the
Securities Act, or (iii) such Registrable Securities shall have ceased to be
outstanding.
ARTICLE III
REGISTRATION UNDER THE SECURITIES ACT
Section 3.1 Required Registration.
(a) The Company shall file a "shelf" registration
statement with the SEC covering all of the Registrable Securities (the "Shelf
Registration Statement") as soon as practicable and in no event more than 30
days after the Closing Date and the Company shall use its commercially
reasonable efforts to have such Shelf Registration Statement declared effective
by the SEC as soon as practicable thereafter, but in no event later than the
120th day after the Closing Date. The Company agrees to use its commercially
reasonable efforts to keep such Shelf Registration Statement Continuously
Effective until such time as (i) all of the Registrable Securities have been
sold by the Holders or (ii) this Agreement terminates in accordance with Section
11.3, including, if necessary, by filing with the SEC a post-effective amendment
or a supplement to the Shelf Registration Statement or the related prospectus or
any document incorporated therein by reference or by filing any other required
document or otherwise supplementing or amending the Shelf Registration
Statement, if required by the rules, regulations, or instructions applicable to
the registration form used by the Company for such Shelf Registration Statement
or by the Securities Act, the Exchange Act, any state securities or blue sky
laws, or any rules and regulations thereunder.
(b) In addition, if for any reason, the Shelf
Registration Statement is not kept Continuously Effective, in addition to any
other claims the Holders may have for breach of contract, the Holders shall have
the right to request in writing (a "Request") (which Request shall specify the
Registrable Securities intended to be disposed of by such Holders and the
intended method of distribution thereof, which may include sales for cash or
dispositions upon exchange or conversion of securities or dispositions for any
form of consideration or no consideration) that the Company register such
portion of such Holders' Registrable Securities as shall be specified in the
Request (a "Demand Registration") by filing with the SEC, as soon as
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practicable thereafter, but not later than the 30th day after the receipt of
such a Request by the Company, a registration statement (a "Demand Registration
Statement") covering such Registrable Securities, and the Company shall use its
commercially reasonable efforts to have such Demand Registration Statement
declared effective by the SEC as soon as practicable thereafter, but in no event
later than the 120th day after the receipt of such a Request. The Company agrees
to use its commercially reasonable efforts to keep such Demand Registration
Statement Continuously Effective for the period specified in the Request, as
extended by the length of any Suspension Period (as defined in Section 7) with
respect thereto (or for such shorter period which will terminate when all of the
Registrable Securities covered by such Demand Registration Statement shall have
been sold pursuant thereto), including, if necessary, by filing with the SEC a
post-effective amendment or a supplement to the Demand Registration Statement or
the related prospectus or any document incorporated therein by reference or by
filing any other required document or otherwise supplementing or amending the
Demand Registration Statement, if required by the rules, regulations or
instructions applicable to the registration form used by the Company for such
Demand Registration Statement or by the Securities Act, the Exchange Act, any
state securities or blue sky laws, or any rules and regulations thereunder;
provided that such period during which the Demand Registration Statement shall
remain Continuously Effective shall, in the case of an Underwritten Offering, be
extended for such period (if any) as the underwriters shall reasonably require,
including to satisfy, in the judgment of counsel to the underwriters, any
prospectus delivery requirements imposed by applicable law.
The Company shall not be obligated to effect more than three
(3) Demand Registrations pursuant to Requests. For purposes of the preceding
sentence, a Demand Registration shall not be deemed to have been effected, (i)
unless a Demand Registration Statement with respect thereto has become
effective, (ii) if after such Demand Registration Statement has become
effective, the offer, sale or distribution of Registrable Securities thereunder
is prevented by any stop order, injunction or other order or requirement of the
SEC or other Governmental Entity for any reason not attributable to any Holder
and such effect is not thereafter eliminated, or (iii) if the conditions to
closing specified in the underwriting agreement entered into in connection with
such Registration are not satisfied or waived, other than by reason of a failure
on the part of any Holder. If the Company shall have complied with its
obligations under this Agreement, a right to a Demand Registration pursuant to
this Section 3(a) shall be deemed to have been satisfied upon the earlier of (x)
the date as of which all of the Registrable Securities included therein shall
have been sold or distributed pursuant to the Demand Registration Statement, and
(y) the date as of which such Demand Registration shall have been Continuously
Effective for the period specified in the preceding paragraph following the
effectiveness of such Demand Registration Statement.
Any Request made pursuant to this Section 3.1 shall be
addressed to the attention of the Secretary of the Company, and shall specify
(a) the number of Registrable Securities to be Registered, (b) the intended
method of distribution thereof and the requested period of effectiveness, and
(c) that the request is for a Demand Registration pursuant to this Section 3(a).
(c) The Company may not include in a Demand
Registration pursuant to Section 3.1 hereof, shares of Common Stock for the
account of the Company or any subsidiary of the Company, but, if and to the
extent required by a contractual obligation existing on the date hereof, may,
subject to compliance with Section 3.1(d), include shares of Common Stock for
the account of any other Person who holds shares of Common Stock entitled to be
included therein; provided, however, that, except to the extent modified with
the consent of the
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Holders, if the Underwriters' Representative of any offering described in this
Section 3.1 shall have informed the Holders in writing that in its judgment
there is a Maximum Number of shares of Common Stock that all Holders and any
other Persons desiring to participate in such Registration may include in such
offering, then the Company shall include in such Demand Registration all
Registrable Securities requested to be included in such Registration by the
Holders together with up to such additional number of shares of Common Stock
that any other Persons entitled to participate in such Registration desire to
include in such Registration up to the Maximum Number that the Underwriters'
Representative has informed the Holders may be included in such Registration
without materially and adversely affecting the success or pricing of such
offering; provided that the number of shares of Common Stock to be offered for
the account of all such other Persons participating in such Registration shall
be reduced in a manner determined by the Company in its sole discretion.
(d) No Holder may participate in any underwritten
offering under Section 3.1 hereof and no other Person shall be permitted to
participate in any such offering pursuant to Section 3.1 hereof unless it
completes and executes all customary questionnaires, powers of attorney, custody
agreements, underwriting agreements, and other customary documents required
under the customary terms of such underwriting arrangements. In connection with
any underwritten offering under Section 3.1 hereof, each participating Holder
and the Company and each other Person shall be a party to the underwriting
agreement with the underwriters and may be required to make certain customary
representations and warranties and provide certain customary indemnifications
for the benefit of the underwriters; provided that the Holders shall not be
required to make representations and warranties with respect to the Company and
its Subsidiaries or their business and operations and shall not be required to
agree to any indemnity or contribution provisions less favorable to them than as
are set forth herein.
Section 3.2 Incidental Registration.
(a) Notwithstanding the fact that all of the
Registrable Securities may be registered under the Shelf Registration Statement,
if at any time the Company proposes to register any Related Securities under the
Securities Act (other than in connection with any acquisition or business
combination transaction and other than in connection with stock options and
other stock-based employee benefit plans and compensation) either in connection
with a primary offering for cash for the account of the Company, a secondary
offering or a combined primary and secondary offering, the Company will each
time it intends to effect such a registration, give written notice (a "Company
Notice") to all Holders of Registrable Securities at least 20 business days
prior to the initial filing of a registration statement with the SEC pertaining
thereto, informing such Holders of its intent to file such registration
statement and of the Holders' right to request the registration of the
Registrable Securities held by the Holders. Upon the written request of the
Holders made within 15 business days after any such Company Notice is given
(which request shall specify the Registrable Securities intended to be disposed
of by such Holder and, unless the applicable registration is intended to effect
a primary offering of Common Stock for cash for the account of the Company, the
intended method of distribution thereof), the Company will use its commercially
reasonable efforts to effect the registration under the Securities Act of all
Registrable Securities which the Company has been so requested to register by
the Holders to the extent required to permit the disposition (in accordance with
the
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intended methods of distribution thereof or, in the case of a registration which
is intended to effect a primary offering for cash for the account of the
Company, in accordance with the Company's intended method of distribution) of
the Registrable Securities so requested to be registered, including, if
necessary, by filing with the SEC a post-effective amendment or a supplement to
the registration statement filed by the Company or the related prospectus or any
document incorporated therein by reference or by filing any other required
document or otherwise supplementing or amending the registration statement filed
by the Company, if required by the rules, regulations or instructions applicable
to the registration form used by the Company for such registration statement or
by the Securities Act, any state securities or blue sky laws, or any rules and
regulations thereunder; provided, however, that if, at any time after giving
written notice of its intention to register any securities and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
delay such registration of the securities, the Company shall give written notice
of such determination to each Holder of Registrable Securities and, thereupon,
(A) in the case of a determination not to register, the Company shall be
relieved of its obligation to register any Registrable Securities in connection
with such registration (but not from its obligation to pay the Registration
Expenses incurred in connection therewith), and (B) in the case of a
determination to delay such registration, the Company shall be permitted to
delay registration of any Registrable Securities requested to be included in
such registration statement for the same period as the delay in registering such
other securities.
The registration rights granted pursuant to the provisions of
this Section 3.2 shall be in addition to the registration rights granted
pursuant to the other provisions of Article III.
(b) If, in connection with a Registration Statement
pursuant to this Section 3.2, the Underwriters' Representative of the offering
registered thereon shall inform the Company and the Holders in writing that in
its opinion there is a Maximum Number of shares of Common Stock that may be
included therein; then (a) in the event such Registration Statement relates to
an offering initiated by the Company of Common Stock being offered for the
account of the Company, the Company may include in such registration the number
of shares it proposes to offer and, if such number is less than the Maximum
Number, then the number of shares of Common Stock requested to be included by
any Person other than the Company (including the Holders) may be reduced, pro
rata in proportion to the respective number of shares of Common Stock owned by
such Persons, to the extent necessary to reduce the respective total number of
shares of Common Stock requested to be included in such offering to the Maximum
Number of shares of Common Stock recommended by such Underwriters'
Representative and (b) in the event such a Registration Statement is initiated
by any Person other than the Company, except to the extent modified with the
consent of the Holders, the number of shares of Common Stock requested to be
included by such Person and any other Person (including the Holders) may be
reduced pro rata in proportion to the respective number of shares of Common
Stock owned by such Persons, to the extent necessary to reduce the respective
total number of shares of Common Stock requested to be included in such offering
to the Maximum Number.
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ARTICLE IV
BLACKOUT PERIOD
Section 4.1 General. Subject to the provisions in Section 4.2, the
Company shall be entitled to elect that a Registration Statement not be usable,
or that the filing thereof be delayed beyond the time otherwise required, for a
reasonable period of time, but not in excess of 60 days (a "Blackout Period"),
if the Company determines in good faith that the registration and distribution
of Registrable Securities (or the use or filing of the Registration Statement or
related Prospectus) would interfere with any pending material financing,
acquisition, corporate reorganization or any other material corporate
development involving the Company or any of its subsidiaries or would require
premature disclosure thereof and promptly gives the Holders of Registrable
Securities written notice of such determination, and to the extent practicable
an approximation of the anticipated delay; provided, however, that the aggregate
number of days included in all Blackout Periods, when taken together with any
Suspension Periods (as defined in Section 7), during any consecutive 12 months
shall not exceed 90 days.
Section 4.2 Specific Blackout Procedures. All Registrable Securities
sold or distributed under a Demand Registration shall be made in accordance with
the following provisions:
(a) Underwritten Offerings. With respect to an
Underwritten Offering, the provisions of Section 4.1 shall apply to the delaying
by the Company of (i) the filing of a Registration Statement and (ii) causing a
Registration Statement to become effective. Once an underwriting agreement as
contemplated by Section 7(i) has been entered into in connection with the
Underwritten Offering, the terms of such underwriting agreement and Section 3.1,
and not the provisions of Section 4.1, shall govern the continued effectiveness
and use of the Registration Statement as it relates to such Underwritten
Offering. However, if the underwriting agreement did not contain provisions for
blackout periods, Section 4.1 would continue to apply.
(b) Other Offerings. With respect to an offering
other than an Underwritten Offering, the procedures of this Section 4.2(b) shall
supplement Section 4.1 with respect to sales after the effectiveness of the
Registration Statement. The Holders can assume that there is not a Blackout
Period and that the Registration Statement is current unless they have received
a written notice to the contrary from the Company.
ARTICLE V
SELECTION OF UNDERWRITERS
If any offering pursuant to a Demand Registration Statement is an
underwritten offering, the Holders will select a managing underwriter or
underwriters to administer the offering, in its sole discretion after
consultation with the Company. In such event, the Company may select a
co-manager in its sole discretion after consultation with the Holders. In any
incidental registration pursuant to Section 3.2, the Company will select a
managing underwriter or
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underwriters to administer the offering, in its sole discretion after
consultation with the Holders.
ARTICLE VI
HOLDBACK AGREEMENT
(a) If so requested by the Underwriters'
Representative in connection with an offering of any Registrable Securities, the
Company shall agree not to effect any sale or distribution of shares of Common
Stock, without the prior written consent of the Underwriters' Representative
(other than as a part of such offering or in connection with any acquisition or
business combination transaction and other than in connection with stock options
and employee benefit plans and compensation) during the 7-day period prior to,
and during the 90-day period beginning on, the date such registration statement
is declared effective under the Securities Act by the SEC and shall use its
commercially reasonable efforts to obtain and enforce similar agreements from
any other Persons if requested by the Underwriters' Representative; provided
that the Company or such Persons shall not be subject to the restrictions set
forth in this Section 6(a) for longer than 97 days during any 12-month period.
(b) Notwithstanding anything else in this Section 6
to the contrary, no Holder shall be precluded from distributing to any or all of
its stockholders any or all of the Registrable Securities.
(c) As used in paragraphs (a) and (b) of this Section
6, "sales" or "distributions" shall be deemed to include, to the extent
requested by the Underwriters' Representative, (1) contracts to sell, sales of
options or contracts to purchase, purchases of any option or contract to sell,
grants of options, rights or warrants to purchase or otherwise transfer or
dispose of, directly or indirectly, any of the Shares or any securities
convertible into or exercisable or exchangeable for the Shares and (2) swaps or
other arrangements that transfer to another, in whole or in part, any of the
economic consequences of ownership of the Shares, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of the Shares
or such other securities, in cash or otherwise.
ARTICLE VII
REGISTRATION PROCEDURES
If and whenever the Company is required to or to use its commercially
reasonable efforts to effect or cause the registration of any Registrable
Securities under the Securities Act as provided in this Agreement, the Company
will, as expeditiously as possible and without limiting any time period or
obligation set forth elsewhere in this Agreement:
(a) Prepare and file with the SEC a Registration
Statement with respect to such Registrable Securities on a form for which the
Company then qualifies, and which form shall be available for the sale of the
Registrable Securities in accordance with the intended methods of distribution
thereof, and use its best efforts to cause such Registration Statement to become
and remain effective; provided that, a reasonable time before filing a
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Registration Statement or Prospectus, or any amendments or supplements thereto
(other than reports required to be filed by it under the Exchange Act and the
rules and regulations adopted by the SEC thereunder), the Company will furnish
to the Holders and their counsel for review and comment, copies of all documents
proposed to be filed and provided further, that if the Holders so request, they
and their counsel and other representatives may participate in the drafting and
preparation of such Registration Statement;
(b) prepare and file with the SEC amendments and
post-effective amendments to each such Registration Statement and such
amendments and supplements to the Prospectus used in connection therewith as may
be required by the Securities Act or the Exchange Act or otherwise necessary to
keep the Registration Statement effective for the applicable period and cause
the Prospectus as so supplemented to be filed pursuant to Rule 424 under the
Securities Act, and to otherwise comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by such
Registration Statement until such time as all of such securities have been
disposed of in accordance with the intended methods of disposition set forth in
such Registration Statement and Prospectus or such earlier time as the Company's
obligations to maintain the effectiveness and availability for use of such
Registration Statement ceases;
(c) furnish to each Holder of such Registrable
Securities such number of copies of such Registration Statement and of each
amendment and post-effective amendment thereto (in each case including all
exhibits), the Prospectus and Prospectus supplement, as applicable, and such
other documents as such Holder may reasonably request in order to facilitate the
disposition of the Registrable Securities by such Holder (the Company hereby
consenting to the use (subject to the limitations set forth in the last
paragraph of this Section 7) of the Prospectus or any amendment or supplement
thereto in connection with such disposition);
(d) use its commercially reasonable efforts to
register or qualify such Registrable Securities covered by such Registration
Statement under such other securities or blue sky laws of such jurisdictions as
each Holder shall reasonably request, and do any and all other acts and things
which may be reasonably necessary or advisable to enable such Holder to
consummate the disposition in such jurisdictions of the Registrable Securities
owned by such Holder, except that the Company shall not for any such purpose be
required to qualify generally to do business as a foreign corporation in any
jurisdiction where, but for the requirements of this Section 7(d), it would not
be obligated to be so qualified, to subject itself to taxation in any such
jurisdiction, or to consent to general service of process in any such
jurisdiction;
(e) notify each Holder of any such Registrable
Securities covered by such Registration Statement, at any time when a Prospectus
relating thereto is required to be delivered under the Securities Act within the
appropriate period mentioned in Section 7(b), of the Company's becoming aware
that 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,
in light of the circumstances under which they were made, not misleading, then
existing, and at the request of any such Holder, prepare and furnish to such
Holder a reasonable number of copies
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of an amendment or supplement to the Registration Statement or related
Prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such Registrable Securities, such Prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(f) notify each Holder of Registrable Securities
covered by such Registration Statement at any time,
(i) when the Prospectus or any Prospectus
supplement or post-effective amendment has been filed, and, with respect to the
Registration Statement or any post-effective amendment, when the same has become
effective,
(ii) of any request by the SEC for
amendments or supplements to the Registration Statement or the Prospectus or for
additional information, and of any comments, oral or written, by the SEC with
respect thereto,
(iii) of the issuance by the SEC of any stop
order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose,
(iv) if at any time the representations and
warranties of the Company made pursuant to agreements contemplated by paragraph
(i)(1) below cease to be true and correct, and
(v) of the receipt by the Company of any
notification with respect to the suspension of qualification or exemption from
qualification of the Registrable Securities for offering or sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose;
(g) otherwise use its commercially reasonable efforts
to make available to its security holders, as soon as reasonably practicable
(but not more than eighteen months) after the effective date of the Registration
Statement, an earnings statement which shall satisfy the provisions of Section
11(a) of the Securities Act and the rules and regulations promulgated
thereunder;
(h) cause all such Registrable Securities to be
listed on any securities exchange on which the Common Stock is then listed, if
such Registrable Securities are not already so listed and if such listing is
then permitted under the rules of such exchange, and to provide a transfer
agent, CUSIP number and registrar for such Registrable Securities covered by
such Registration Statement no later than the effective date of such
Registration Statement;
(i) enter into agreements (including underwriting
agreements) and take all other appropriate actions in order to expedite or
facilitate the disposition of such Registrable Securities as is customarily made
or done by issuers of comparable standing in connection with comparable
offerings and in such connection (to the extent so customary):
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(i) make such representations and warranties
to the Holders of such Registrable Securities and the underwriters, if any, and
agree to such indemnification and contribution agreements, in form, substance
and scope as are customarily made by issuers to underwriters in comparable
underwritten offerings;
(ii) obtain opinions of counsel to the
Company (which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the underwriters, if any, and the Holders of the
Registrable Securities being sold) addressed to each Holder and the
underwriters, if any, covering the matters customarily covered in opinions
requested in comparable underwritten offerings and such other matters as may be
reasonably requested by such Holders and underwriters;
(iii) obtain comfort letters and updates
thereof from the Company's independent accountants addressed to the selling
Holders of Registrable Securities and the underwriters, if any, such letters to
be in customary form and covering matters of the type customarily covered in
"cold comfort" letters in connection with comparable underwritten offerings;
(iv) if requested, provide the
indemnification in accordance with the provisions and procedures of Section 9
hereof to all parties to be indemnified pursuant to said Section; and
(v) deliver such documents and certificates
as may be reasonably requested by the Holders of a majority of the Registrable
Securities being sold and the underwriters, if any, to evidence compliance with
clause (f) above and with any customary conditions contained in the underwriting
agreement or other agreement entered into by the Company. The matters set forth
in this Section 7(i) shall be effected at each closing under any underwriting or
similar agreement as and to the extent required thereunder.
(j) cooperate with the Holders of Registrable
Securities covered by such Registration Statement and the underwriter or
underwriters, if any, to facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legends) representing the securities
to be sold under such Registration Statement, and enable such securities to be
in such denominations and registered in such names as the underwriter or
underwriters, if any, or such Holders may request, or take other appropriate
action if the Registrable Securities are to be uncertificated;
(k) if requested by the underwriter or underwriters
or a Holder of Registrable Securities being sold in connection with an
underwritten offering, promptly incorporate in a Prospectus supplement or
post-effective amendment such information as the underwriters and the Holders of
the Registrable Securities being sold agree should be included therein relating
to the plan of distribution with respect to such Registrable Securities,
including, without limitation, information with respect to the amount of
Registrable Securities being sold to such underwriters, the purchase price being
paid therefor by such underwriters and with respect to any other terms of the
underwritten offering of the Registrable Securities to be sold in such offering
and make all required filings of such Prospectus supplement or post-effective
12
amendment promptly upon being notified of the matters to be incorporated in such
Prospectus supplement or post-effective amendment;
(l) participate, and have senior management available
to participate, in any "roadshow" marketing efforts reasonably requested by the
Holders or any underwriters; and
(m) make available for inspection by any Holder of
Registrable Securities included in such Registration Statement, any underwriter
participating in any disposition pursuant to such Registration Statement, and
any attorney, accountant or other agent retained by any such Holder or
underwriter in connection with such disposition, such financial and other
records and other information, pertinent corporate documents and properties of
any of the Company and its subsidiaries and affiliates, as shall be reasonably
necessary to enable them to exercise their due diligence responsibility.
The Company may require each Holder of Registrable Securities
as to which any registration is being effected to furnish the Company with such
information regarding such Holder and pertinent to the disclosure requirements
relating to the registration and the distribution of such securities as the
Company may from time to time reasonably request.
Each Holder of Registrable Securities agrees that, upon
receipt of any notice (the "Suspension Notice") from the Company of the
happening of any event of the kind described in Section 7(e), such Holder will
forthwith discontinue disposition of Registrable Securities pursuant to the
Prospectus or Registration Statement covering such Registrable Securities until
such Holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 7(e), and, if so directed by the Company, such Holder
will use its best efforts to deliver to the Company (at the Company's expense)
all copies, other than permanent file copies then in such Holder's possession,
of the Prospectus covering such Registrable Securities current at the time of
receipt of such notice. In the event the Company shall give any such notice, the
period of time during which the Registration Statement is required to be
Continuously Effective pursuant to Section 3 hereof shall be extended by the
number of days during the period (the "Suspension Period") from the date of the
giving of such Suspension Notice and through the date when the Holders of
Registrable Securities covered by such Registration Statement shall have
received the copies of the supplemented or amended Prospectus contemplated by
Section 7(e).
ARTICLE VIII
REGISTRATION EXPENSES
The Company will pay all Registration Expenses in connection
with all registrations of Registrable Securities, and the Holders shall pay all
underwriting discounts and commissions and transfer taxes, if any, relating to
the sale or disposition of such Holders' Registrable Securities pursuant to a
Registration Statement.
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ARTICLE IX
INDEMNIFICATION; CONTRIBUTION
Section 9.1 Indemnification by the Company. The Company agrees to
indemnify each Holder of Registrable Securities, its officers and directors and
each Person who controls such Holder (within the meaning of the Securities Act),
and any agent and investment or financial adviser thereof against all losses,
claims, damages, liabilities and expenses (including reasonable attorneys' fees
and expenses of investigation) incurred by such party pursuant to any actual or
threatened action, suit, proceeding or investigation arising out of or based
upon (i) any untrue or alleged untrue statement of material fact contained in a
Registration Statement, any Prospectus or preliminary Prospectus, or any
amendment or supplement to any of the foregoing or (ii) any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of a Prospectus or a
preliminary Prospectus, in light of the circumstances under which they were
made) not misleading, except in each case insofar as the same arise out of or
are based upon any such untrue statement or omission made in reliance on and in
conformity with information furnished in writing to the Company by any party
indemnified under this Section 9.1 or its counsel expressly for use therein. In
connection with an Underwritten Offering, the Company will indemnify the
underwriters thereof, their officers and directors and each Person who controls
such underwriters (within the meaning of the Securities Act) to the same extent
as provided above with respect to the indemnification of the Holders of
Registrable Securities (provided that as to each underwriter the exception to
such indemnification obligation shall instead be for information with respect to
such underwriter furnished in writing by such underwriter or its counsel).
Notwithstanding the foregoing provisions of this Section 9.1, in the case of an
offering that is not an Underwritten Offering, the Company will not be liable to
any Holder of Registrable Securities under the indemnity agreement in this
Section 9.1 for any such loss, claim, damage, liability (or action or proceeding
in respect thereof) or expense that arises out of such Holder's failure to send
or give a copy of the final Prospectus (as it may then be amended or
supplemented) to the Person asserting an untrue statement or alleged untrue
statement or omission or alleged omission at or prior to the written
confirmation of the sale of the Registrable Securities to such Person if such
statement or omission was corrected in such final Prospectus (as it may then be
amended or supplemented) and the Company has previously furnished copies thereof
in accordance with this Agreement.
Section 9.2 Indemnification by Holders of Registrable Securities. In
connection with a Registration Statement, each Holder shall furnish to the
Company in writing such information, including with respect to the name, address
and the amount of Registrable Securities held by such Holder, as the Company
reasonably requests for use in such Registration Statement or the related
Prospectus and agrees to indemnify and hold harmless (in the same manner and to
the same extent as set forth in Section 9.1 the Company, all other prospective
Holders or any underwriter, as the case may be, and any of their respective
affiliates, directors, officers and controlling Persons (within the meaning of
the Securities Act) against any losses, claims, damages, liabilities and
expenses resulting from any untrue or alleged untrue statement of a material
fact or any omission or alleged omission of a material fact required to be
stated in such Registration Statement or Prospectus or any amendment or
supplement to either of them or necessary to make the statements therein (in the
case of a Prospectus, in the light of the
14
circumstances then existing) not misleading, but only to the extent that any
such untrue statement or omission is made in reliance on and in conformity with
information with respect to such Holder furnished in writing to the Company by
such Holder or its counsel specifically for inclusion therein.
Section 9.3 Conduct of Indemnification Proceedings. Any Person entitled
to indemnification hereunder agrees to give prompt written notice to the
indemnifying party after the receipt by such indemnified party of any written
notice of the commencement of any action, suit, proceeding or investigation or
threat thereof made in writing for which such indemnified party may claim
indemnification or contribution pursuant to this Agreement (provided that
failure to give such notification shall not affect the obligations of the
indemnifying person pursuant to this Section 9 except to the extent the
indemnifying party shall have been actually prejudiced as a result of such
failure). In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
the indemnified parties and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under these
indemnification provisions for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation, except as provided in the following sentence. Any such
indemnified party shall have the right to employ separate counsel in any such
action, claim or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be the expenses of such indemnified
party unless (i) the indemnifying party has agreed to pay such fees and expenses
or (ii) the indemnifying party shall have failed to promptly assume the defense
of such action, claim or proceeding or (iii) the named parties to any such
action, claim or proceeding (including any impleaded parties) include both such
indemnified party and the indemnifying party, and such indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it which are different from or in addition to those available to
the indemnifying party and that the assertion of such defenses could, in the
good faith judgment of the indemnified party, create a conflict of interest such
that counsel employed by the indemnifying party could not faithfully represent
the indemnified party (in case of clauses (ii) and (iii) , if such indemnified
party notifies the indemnifying party in writing that it elects to employ
separate counsel at the expense of the indemnifying party (which counsel shall
be reasonably satisfactory to the indemnifying party), the indemnifying party
shall not have the right to assume the defense of such action, claim or
proceeding on behalf of such indemnified party; it being understood, however,
that the indemnifying party shall not, in connection with any one such action,
claim or proceeding or separate but substantially similar or related actions,
claims or proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys (together with appropriate local
counsel) at any time for all such indemnified parties, unless in the good faith
judgment of such indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
action, claim or proceeding, in which event the indemnifying party shall be
obligated to pay the fees and expenses
15
of such additional counsel or counsels). The indemnifying party will not be
subject to any liability for any settlement made without its consent (which
consent will not be unreasonably withheld).
Section 9.4 Contribution. To the extent the indemnification from the
indemnifying party provided for in this Section 9 is unavailable to an
indemnified party hereunder in respect of any losses, claims, damages,
liabilities or expenses referred to therein, then the indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, liabilities and expenses in such proportion as is appropriate to
reflect the relative fault of the indemnifying party and indemnified party in
connection with the actions which resulted in such losses, claims, damages,
liabilities and expenses, as well as any other relevant equitable
considerations. The relative fault of such indemnifying party and indemnified
party shall be determined by reference to, among other things, whether any
action in question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact, has been
made by, or relates to information supplied by, such indemnifying party or
indemnified party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action. The amount paid
or payable by a party as a result of the losses, claims, damages, liabilities
and expenses referred to above shall be deemed to include, subject to the
limitations set forth in Section 9.3, any legal and other fees and expenses
reasonably incurred by such indemnified party in connection with any
investigation or proceeding. The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 9.4 were determined by
pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 9.4, no underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Registrable Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission, and no
Holder of Registrable Securities shall be required to contribute any amount in
excess of the amount by which the total price at which the Registrable
Securities of such Holder were offered to the public (net of all underwriting
discounts and commissions) exceeds the amount of any damages which such Holder
has otherwise been required to pay by reason of such untrue statement or
omission. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation. To the
extent indemnification is available under this Section 9, the indemnifying
parties shall indemnify each indemnified party to the full extent provided in
Section 91 or 9.2, as the case may be, without regard to the relative fault of
said indemnifying parties or indemnified party or any other equitable
consideration provided for in this Section 9.4.
Section 9.5 The provisions of this Section 9 shall be applicable in
respect of each registration pursuant to this Agreement, shall be in addition to
any liability which any party may have to any other party and shall survive any
termination of this Agreement.
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ARTICLE X
RULE 144
For a period of two years following the Closing Date or, if at the end
of such two year period, a Holder is an affiliate of the Company, until such
time as no Holder is an affiliate of the Company, the Company covenants that it
will file the reports required to be filed by it under the Securities Act and
the Exchange Act (or, if the Company is not required to file such reports, it
will, upon the request of any Holder of Registrable Securities, make publicly
available other information so long as necessary to satisfy the requirements of
Rule 144 under the Securities Act relating to the availability of public
information), all to the extent required from time to time to enable such Holder
to sell Registrable Securities without registration under the Securities Act
within the limitation of the exemptions provided by (a) Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (b) any
similar rule or regulation hereafter adopted by the SEC. Upon the request of any
Holder of Registrable Securities, the Company will deliver to such Holder a
written statement as to whether it has complied with such requirements.
ARTICLE XI
MISCELLANEOUS
Section 11.1 No Inconsistent Agreements. The Company is not a party to
any agreement and will not hereafter enter into any agreement with respect to
its securities which is inconsistent with or which otherwise materially limits,
restricts interferes with the rights granted to the Holders hereunder.
Section 11.2 Remedies. No failure or delay on the part of either party
hereto in the exercise of any right hereunder shall impair such right or be
construed to be a waiver of, or acquiescence in, any breach of any
representation, warranty or agreement herein, nor shall any single or partial
exercise of any such right preclude other or further exercise thereof or of any
other right. All rights and remedies existing under this Agreement are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
Each Holder of Registrable Securities in addition to being entitled to exercise
all rights granted by law, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement.
Section 11.3 Termination. The right of any Holder to request
registration or inclusion in any registration pursuant to this Agreement shall
terminate on such date as all shares of Registrable Securities held or entitled
to be held upon conversion by such Holder (and any affiliates that is a Holder)
is less than one percent (1%) of the total outstanding shares of Common Stock of
the Company as shown by the then most recent Form 10-Q of the Company filed with
the SEC or the Holder meets the requirements of Rule 144(k) of the Securities
Act of 1933, as amended.
Section 11.4 Amendment. No change or amendment will be made to this
Agreement except by an instrument in writing signed on behalf of the Company and
Holders owning a majority of the Registrable Securities at the time of such
amendment.
17
Section 11.5 Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
shall supersede all prior written and oral and all contemporaneous oral
agreements and understandings with respect to the subject matter hereof.
Section 11.6 Notices. Notices, offers, requests or other communications
required or permitted to be given by either party pursuant to the terms of this
Agreement shall be given in writing to the respective parties to the following
addresses:
if to the Holders:
Schlumberger Technology Corporation
0000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy, which shall not constitute notice, to:
Xxxx Xxxx Xxxx & Freidenrich LLP
0000 X. XxXxx Xxxxxxxxxx, Xxxxx 000
Xxxxxx, Xxxxx 787-6875
Attention: Xxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to the Company:
Grant Prideco, Inc.
0000 Xxxx Xxx Xxxx., Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: General Counsel
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy, which shall not constitute notice, to:
Fulbright & Xxxxxxxx L.L.P.
0000 XxXxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attention: Xxxxxxx X. Still
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
18
or to such other address as the party to whom notice is given may have
previously furnished to the other in writing as provided herein. Any notice
involving non-performance, termination, or renewal shall be sent by hand
delivery, recognized overnight courier or, within the United States, may also be
sent via certified mail, return receipt requested. All other notices may also be
sent by fax, confirmed by first class mail. All notices shall be deemed to have
been given and received on the earlier of actual delivery or three days from the
date of postmark.
Section 11.7 Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors of each of the parties and each
transferee of Registrable Securities who is an affiliate of a Holder or, if the
Shelf Registration Statement is not Continuously Effective, any transferee of
Registrable Securities who is designated to come within the term "Holder" by the
transferor.
Section 11.8 Authority. Each of the parties hereto represents to the
other that (a) it has the corporate or other requisite power and authority to
execute, deliver and perform this Agreement, (b) the execution, delivery and
performance of this Agreement by it have been duly authorized by all necessary
corporate or other actions, (c) it has duly and validly executed and delivered
this Agreement, and (d) this Agreement is a legal, valid and binding obligation,
enforceable against it in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally and general equity principles.
Section 11.9 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original but all of which
shall constitute one and the same agreement.
Section 11.10 Descriptive Headings. The headings contained in this
Agreement and in the table of contents to this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement. When a reference is made in this Agreement to an Article or a
Section, such reference shall be to an Article or Section of, or an Exhibit or
Schedule to, this Agreement unless otherwise indicated.
Section 11.11 Governing Law. This Agreement shall be construed in
accordance with and all disputes hereunder shall be governed by the laws of the
State of Texas, excluding its conflict of law rules.
Section 11.12 No Strict Construction. The language used in this
Agreement has been chosen by all of the parties hereto to express their mutual
input, and no rule of strict construction will be used against any party hereto.
Section 11.13 Severability. If any term or other provision of this
Agreement is determined by a court, administrative agency or arbitrator to be
invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to either party. Upon such determination that any term or other
provision is invalid,
19
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner to the end that
transactions contemplated hereby are fulfilled to the fullest extent possible.
[The Remainder of this Page is Intentionally Left Blank.]
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IN WITNESS WHEREOF, the parties have executed this
Registration Rights Agreement as of the date first written above.
GRANT PRIDECO, INC.
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
SCHLUMBERGER TECHNOLOGY CORPORATION
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
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