EX-1.1
Exhibit 1.1
Execution Version
FORUM ENERGY TECHNOLOGIES, INC.
$100,000,000
6.250% Senior Notes
due 2021
Purchase Agreement
November 19, 2013
J.P. Morgan Securities
LLC
As Representative of the
several Initial Purchasers listed
in
Schedule 1 hereto
c/o J.P. Morgan Securities LLC
383
Madison Avenue
New York, New York 10179
Ladies and
Gentlemen:
Forum Energy Technologies, Inc., a Delaware corporation (the “Company”), proposes to issue and sell to the
several initial purchasers listed in Schedule 1 hereto (the “Initial Purchasers”), for whom you are acting as representative (the “Representative”), $100,000,000 principal amount of its 6.250% Senior Notes
due 2021 (the “Securities”). The Securities will be issued as “Additional Notes” pursuant to that certain Indenture dated as of October 2, 2013 (the “Indenture”) by and among the Company, the
guarantors listed in Schedule 2 hereto (the “Guarantors”) and Wells Fargo Bank, National Association, as trustee (the “Trustee”), and will be guaranteed on a senior unsecured basis by each of the Guarantors
(the “Guarantees”). The Company previously issued, on October 2, 2013, $300 million aggregate principal amount of its 6.250% Senior Notes due 2021 (the “Existing Securities”). The Securities and the Existing
Securities will be treated as a single class of debt securities under the Indenture.
The Securities will be sold to the Initial
Purchasers without being registered under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon an exemption therefrom or in a transaction not subject thereto. The Company and the Guarantors have prepared a
preliminary offering memorandum dated November 19, 2013 (the “Preliminary Offering Memorandum”) and will prepare an offering memorandum dated the date hereof (the “Offering Memorandum”) setting forth
information concerning the Company, the Guarantors and the Securities. Copies of the Preliminary Offering Memorandum have been, and copies of the Offering Memorandum will be, delivered by the Company to the Initial Purchasers pursuant to the terms
of this purchase agreement (the “Agreement”). The Company hereby confirms that it has
authorized the use of the Preliminary Offering Memorandum, the other Time of Sale Information (as defined below) and the Offering Memorandum in connection with the offering and resale of the
Securities by the Initial Purchasers in the manner contemplated by this Agreement. Capitalized terms used but not defined herein shall have the meanings given to such terms in the Preliminary Offering Memorandum. References herein to the Preliminary
Offering Memorandum, the Time of Sale Information and the Offering Memorandum shall be deemed to refer to and include any document incorporated by reference therein and any reference to “amend,” “amendment” or
“supplement” with respect to the Preliminary Offering Memorandum or the Offering Memorandum shall be deemed to refer to and include any documents filed after such date and incorporated by reference therein.
At or prior to the time when sales of the Securities were first made (the “Time of Sale”), the Company had prepared the
following information (collectively, the “Time of Sale Information”): the Preliminary Offering Memorandum, as supplemented and amended by the written communications listed on Annex A hereto.
Holders of the Securities (including the Initial Purchasers and their direct and indirect transferees) will be entitled to the benefits of a
Registration Rights Agreement (the “Registration Rights Agreement”) to be dated the Closing Date (as defined below), pursuant to which the Company and the Guarantors will agree to file one or more registration statements with the
Securities and Exchange Commission (the “Commission”) providing for the registration under the Securities Act of the Securities or the Exchange Securities referred to (and as defined) in the Registration Rights Agreement and the
related Guarantees.
The Company and the Guarantors hereby confirm their agreement with the several Initial Purchasers concerning the
purchase and resale of the Securities, as follows:
1. Purchase and Resale of the Securities.
(a) The Company agrees to issue and sell the Securities to the several Initial Purchasers as provided in this Agreement, and each Initial
Purchaser, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees, severally and not jointly, to purchase from the Company the respective principal amount of Securities
set forth opposite such Initial Purchaser’s name in Schedule 1 hereto at a price equal to 101.750% of the principal amount thereof plus accrued interest from October 2, 2013 to the Closing Date. The Company will not be obligated to
deliver any of the Securities except upon payment for all the Securities to be purchased as provided herein.
(b) The Company understands
that the Initial Purchasers intend to offer the Securities for resale on the terms set forth in the Time of Sale Information. Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:
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(i) it is a qualified institutional buyer within the meaning of Rule 144A under
the Securities Act (a “QIB”) and an accredited investor within the meaning of Rule 501(a) of Regulation D under the Securities Act (“Regulation D”);
(ii) it has not solicited offers for, or offered or sold, and will not solicit offers for, or offer or sell, the Securities in
any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities Act;
(iii) it has not
sold the Securities as part of its initial offering except within the United States to persons whom it reasonably believes to be QIBs in transactions pursuant to Rule 144A under the Securities Act (“Rule 144A”) and in connection
with each such sale, it has taken or will take reasonable steps to ensure that the purchaser of the Securities is aware that such sale is being made in reliance on Rule 144A; and
(iv) it has not solicited offers for, or offered or sold, and will not solicit offers for, or offer or sell, the Securities as
part of its initial offering except in accordance with the restrictions set forth in Annex C hereto.
(c) Each Initial Purchaser
acknowledges and agrees that the Company and, for purposes of the “no registration” opinions to be delivered to the Initial Purchasers pursuant to Sections 6(f) and 6(h), counsel for the Company and counsel for the Initial Purchasers,
respectively, may rely upon the accuracy of the representations and warranties of the Initial Purchasers, and compliance by the Initial Purchasers with their agreements, contained in paragraph (b) above (including Annex C hereto), and
each Initial Purchaser hereby consents to such reliance.
(d) The Company acknowledges and agrees that the Initial Purchasers may offer and
sell Securities to or through any affiliate of an Initial Purchaser and that any such affiliate may offer and sell Securities purchased by it to or through any Initial Purchaser.
(e) The Company and the Guarantors acknowledge and agree that each Initial Purchaser is acting solely in the capacity of an arm’s length
contractual counterparty to the Company and the Guarantors with respect to the offering of Securities contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an
agent of, the Company, the Guarantors or any other person. Additionally, neither the Representative nor any other Initial Purchaser is advising the Company, the Guarantors or any other person as to any legal, tax, investment, accounting or
regulatory matters in any jurisdiction. The Company and the Guarantors shall consult with their own advisors concerning such matters and shall be responsible for making their own independent investigation and appraisal of the transactions
contemplated hereby, and neither the Representative nor any other Initial Purchaser shall have any responsibility or liability to the Company or the Guarantors with respect thereto. Any review by the Representative or any Initial Purchaser of the
Company, the Guarantors, and the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Representative or such Initial Purchaser, as the case may be, and shall not be on behalf
of the Company, the Guarantors or any other person.
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2. Payment and Delivery.
(a) Payment for and delivery of the Securities will be made at the offices of Vinson & Elkins L.L.P., 1001 Fannin Street, Houston,
Texas at 10:00 A.M., New York City time, on November 22, 2013, or at such other time or place on the same or such other date, not later than the fifth business day thereafter, as the Representative and the Company may agree upon in writing. The
time and date of such payment and delivery is referred to herein as the “Closing Date.”
(b) Payment for the Securities
shall be made by wire transfer in immediately available funds to the account(s) specified by the Company to the Representative against delivery to the nominee of The Depository Trust Company (“DTC”), for the account of the Initial
Purchasers, of one or more global notes representing the Securities (collectively, the “Global Note”), with any transfer taxes payable in connection with the sale of the Securities duly paid by the Company. The Global Note will be
made available for inspection by the Representative not later than 1:00 P.M., New York City time, on the business day prior to the Closing Date.
3. Representations and Warranties of the Company and the Guarantors. The Company and the Guarantors jointly and severally represent and
warrant to each Initial Purchaser that:
(a) Preliminary Offering Memorandum, Time of Sale Information and Offering Memorandum. The
Preliminary Offering Memorandum, as of its date, did not, the Time of Sale Information, at the Time of Sale, did not, and at the Closing Date, will not, and the Offering Memorandum, in the form first used by the Initial Purchasers to confirm sales
of the Securities and as of the Closing Date, will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made,
not misleading; provided that the Company and the Guarantors make no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to any Initial Purchaser furnished
to the Company in writing by such Initial Purchaser through the Representative expressly for use in the Preliminary Offering Memorandum, the Time of Sale Information or the Offering Memorandum, which information is specified in the last sentence of
Section 7(b).
(b) Additional Written Communications; Permitted General Solicitations. The Company and the Guarantors
(including their agents and representatives, other than the Initial Purchasers in their capacity as such) have not prepared, used, authorized, approved or referred to and will not prepare, use, authorize, approve or refer to (x) any written
communication that constitutes an offer to sell or solicitation of an offer to buy the Securities (each such communication by the Company and the Guarantors or their
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agents and representatives (other than a communication referred to in clauses (i) and (ii) below) an “Issuer Written Communication”) other than (i) the Preliminary
Offering Memorandum, (ii) the Offering Memorandum, (iii) the documents listed on Annex A hereto, including a term sheet substantially in the form of Annex B hereto, which constitute part of the Time of Sale Information, and
(iv) any electronic road show or other written communications other than any Permitted General Solicitation (as defined below), in each case used in accordance with Section 4(c) of this Agreement or (y) any general solicitation other
than such solicitation (i) listed on Annex A hereto or (ii) in accordance with Section 4(n) of this Agreement (each such solicitation referred to in clauses (i) and (ii) a “Permitted General
Solicitation”). Each such Issuer Written Communication, when taken together with the Time of Sale Information as of the Time of Sale, did not, and as of the Closing Date will not, contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that the Company and the Guarantors make no representation or warranty with
respect to any statements or omissions made in each such Issuer Written Communication in reliance upon and in conformity with information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the
Representative expressly for use in any Issuer Written Communication, which information is specified in the last sentence of Section 7(b).
(c) Incorporated Documents. The documents incorporated by reference in each of the Time of Sale Information and the Offering Memorandum,
when they were filed with the Commission conformed in all material respects to the requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations of the Commission thereunder, and
none of such documents contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; and any further
documents so filed and incorporated by reference in the Time of Sale Information or the Offering Memorandum on or prior to the Closing Date, when such documents are filed with the Commission, will conform in all material respects to the requirements
of the Exchange Act and the rules and regulations of the Commission thereunder, and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(d) Financial Statements. The financial statements and the related notes thereto of the
Company and its consolidated subsidiaries included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum comply in all material respects with the applicable requirements of the Securities Act and the
Exchange Act, as applicable, and present fairly in all material respects the financial position of the Company and its consolidated subsidiaries, as of the dates indicated and the results of their operations and the changes in their cash flows for
the periods specified; such financial statements have been prepared in conformity with generally accepted accounting principles in the United States applied on a consistent basis throughout the periods covered thereby, and any supporting schedules
included or
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incorporated by reference in each of the Time of Sale Information and the Offering Memorandum present fairly in all material respects the information required to be stated therein; and the other
financial information included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum has been derived from the accounting records of the Company and its consolidated subsidiaries and presents fairly in all
material respects the information shown thereby.
(e) No Material Adverse Change. Since the date of the most recent financial
statements of the Company included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum, and except as disclosed in the Time of Sale Information and the Offering Memorandum, (i) there has not been any
material change in the capital stock (other than the issuance of shares of the Company’s Common Stock upon exercise of stock options and warrants described as outstanding in, and the grant and exercise of options and awards under existing
equity incentive plans described in, the Time of Sale Information and the Offering Memorandum), any material increase in the short-term debt or long-term debt of the Company or any of its subsidiaries, or any dividend or distribution of any kind
declared, set aside for payment, paid or made by the Company on any class of capital stock, or any material adverse change, or any development involving a prospective material adverse change, in or affecting the business, properties, financial
position, stockholders’ equity, results of operations or prospects of the Company and its subsidiaries taken as a whole; (ii) neither the Company nor any of its subsidiaries has entered into any transaction or agreement that is material to
the Company and its subsidiaries taken as a whole or incurred any liability or obligation, direct or contingent, that is material to the Company and its subsidiaries taken as a whole; and (iii) neither the Company nor any of its subsidiaries
has sustained any loss or interference with its business that is material to the Company and its subsidiaries taken as a whole and that is either from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor
disturbance or dispute or any action, order or decree of any court or arbitrator or governmental or regulatory authority, except in each case as otherwise disclosed in each of the Time of Sale Information and the Offering Memorandum.
(f) Organization and Good Standing. The Company and each of its subsidiaries have been duly organized and are validly existing and in
good standing under the laws of their respective jurisdictions of organization, are duly qualified to do business and are in good standing in each jurisdiction in which their respective ownership or lease of property or the conduct of their
respective businesses requires such qualification, and have all power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged, except where the failure to be so qualified, in good
standing or have such power or authority would not, individually or in the aggregate, have a material adverse effect on the business, properties, financial position, stockholders’ equity, results of operations or prospects of the Company and
its subsidiaries taken as a whole or on the performance by the Company and the Guarantors of their obligations under this Agreement, the Indenture, the Securities, and the Guarantees (a “Material Adverse Effect”). The subsidiaries
listed in Schedule 3 to this Agreement are the only significant subsidiaries of the Company.
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(g) Capitalization. The Company has an authorized capitalization as set forth in each of
the Time of Sale Information and the Offering Memorandum under the heading “Capitalization”; all the outstanding shares of capital stock or other equity interests of each subsidiary of the Company have been duly authorized and validly
issued and are fully paid and non-assessable and are not subject to any preemptive or similar rights (except as otherwise described in each of the Time of Sale Information and the Offering Memorandum) and are owned directly or indirectly by the
Company, free and clear of any lien, charge, encumbrance, security interest, restriction on voting or transfer or any other claim of any third party (collectively, “Liens”), except for Liens arising under the Amended and Restated
Credit Agreement, dated as of October 4, 2011, among the Company, as Borrower, Wells Fargo Bank, National Association, as Administrative Agent and Swing Line Lender, Wells Fargo Bank, National Association, JPMorgan Chase Bank, N.A. and Bank of
America, N.A., and such other lenders designated from time to time as issuing lenders, as amended (the “Credit Agreement”).
(h) Due Authorization. The Company and each of the Guarantors have all requisite corporate, limited partnership or limited liability
company power and authority, as the case may be, to execute and deliver this Agreement, the Securities (including the related Guarantees), the Exchange Securities (including the related Guarantees), and the Registration Rights Agreement
(collectively, the “Transaction Documents”) and to perform their respective obligations hereunder, thereunder and under the Indenture; and all corporate, limited partnership or limited liability company action required to be taken
by the Company and each of the Guarantors for the due and proper authorization, execution and delivery by them of each of the Transaction Documents and the consummation by them of the transactions contemplated hereby, thereby and under the Indenture
has been duly and validly taken.
(i) The Indenture. The Indenture has been duly authorized, executed and delivered by the Company
and each of the Guarantors and, assuming the due authorization, execution and delivery by the Trustee, constitutes a valid and legally binding agreement of the Company and each of the Guarantors enforceable against the Company and each of the
Guarantors in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar laws relating to or affecting creditors’ rights generally or by
general principles of equity (regardless of whether such enforceability is considered in a proceeding at law or in equity) (collectively, the “Enforceability Exceptions”); and the Indenture conforms in all material respects to the
requirements of the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”), and the rules and regulations of the Commission applicable to an indenture that is qualified thereunder.
(j) The Securities and the Guarantees. The Securities have been duly authorized by the Company and, when duly executed, authenticated,
issued and delivered as provided in the Indenture and paid for as provided herein, will be duly and validly issued and outstanding and will constitute valid and legally binding obligations of the Company enforceable against the Company in accordance
with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture; and the
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Guarantees have been duly authorized by each of the Guarantors and, when the Securities have been duly executed, authenticated, issued and delivered as provided in the Indenture and paid for as
provided herein, will be valid and legally binding obligations of each of the Guarantors, enforceable against each of the Guarantors in accordance with their terms, subject to the Enforceability Exceptions, and will be entitled to the benefits of
the Indenture.
(k) The Exchange Securities. On the Closing Date, the Exchange Securities (including the related Guarantees) will
have been duly authorized by the Company and each of the Guarantors and, when duly executed, authenticated, issued and delivered in accordance with the Indenture and as contemplated by the Registration Rights Agreement, will be duly and validly
issued and outstanding and will constitute valid and legally binding obligations of the Company, as issuer, and each of the Guarantors, as guarantor, enforceable against the Company and each of the Guarantors in accordance with their terms, subject
to the Enforceability Exceptions, and will be entitled to the benefits of the Indenture.
(l) Purchase and Registration Rights
Agreements. This Agreement has been duly authorized, executed and delivered by the Company and each of the Guarantors; and the Registration Rights Agreement has been duly authorized by the Company and each of the Guarantors and on the Closing
Date will be duly executed and delivered by the Company and each of the Guarantors and, when duly executed and delivered in accordance with its terms by each of the other parties thereto, each of this Agreement and the Registration Rights Agreement
will constitute a valid and legally binding agreement of the Company and each of the Guarantors enforceable against the Company and each of the Guarantors in accordance with its terms, subject to the Enforceability Exceptions, and except that
enforceability may be limited by public policy, applicable law relating to fiduciary duties and indemnification and an implied covenant of good faith and fair dealing.
(m) Descriptions of the Transaction Documents and the Indenture. Each Transaction Document and the Indenture conforms in all material
respects to the description thereof contained in each of the Time of Sale Information and the Offering Memorandum, as applicable.
(n)
No Violation or Default. Neither the Company nor any of its subsidiaries is (i) in violation of its charter or bylaws or similar organizational documents; (ii) in default, and no event has occurred that, with notice or lapse of time
or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject; or (iii) in violation of any law or statute or any judgment,
order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
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(o) No Conflicts. The execution, delivery and performance by the Company and each of the
Guarantors of each of the Transaction Documents to which it is a party, the performance by the Company and each of the Guarantors of the Indenture, the issuance and sale of the Securities and the issuance of the Guarantees, the issuance of the
Exchange Notes and the related Guarantees and the consummation by the Company and each of the Guarantors of the transactions contemplated by the Transaction Documents and the Indenture will not (i) conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under, or result in the creation or imposition of any Lien upon any property or assets of the Company or any of its subsidiaries pursuant to, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject (other than any Lien arising under the Credit Agreement), (ii) result in any violation of the provisions of the charter or bylaws or similar organizational documents of the Company or any of its subsidiaries or
(iii) result in the violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority applicable to the Company and its subsidiaries, except, in the case of clauses
(i) and (iii) above, for any such conflict, breach, violation, default or Lien that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(p) No Consents Required. No consent, approval, authorization, order, license, registration or qualification of or with any court or
arbitrator or governmental or regulatory authority is required for the execution, delivery and performance by the Company and each of the Guarantors of each of the Transaction Documents to which it is a party, the performance by the Company and each
of the Guarantors of the Indenture, the issuance and sale of the Securities and the issuance of the Guarantees, the issuance of the Exchange Notes and the related Guarantees and the consummation by the Company and each of the Guarantors of the
transactions contemplated by the Transaction Documents and the Indenture, except for such consents, approvals, authorizations, orders and registrations or qualifications as may be required (i) under applicable state securities laws in
connection with the purchase and resale of the Securities by the Initial Purchasers and (ii) with respect to the Exchange Securities (including the related Guarantees) under the Securities Act, the Trust Indenture Act and applicable state
securities laws as contemplated by the Registration Rights Agreement.
(q) Legal Proceedings. Except as described in each of the
Time of Sale Information and the Offering Memorandum, there are no legal, governmental or regulatory investigations, actions, suits or proceedings pending to which the Company or any of its subsidiaries is a party or to which any property of the
Company or any of its subsidiaries is the subject that, individually or in the aggregate, if determined adversely to the Company or any of its subsidiaries, could reasonably be expected to have a Material Adverse Effect; to the knowledge of the
Company and each Guarantor, no such investigations, actions, suits or proceedings are threatened or contemplated by any governmental or regulatory authority or threatened by others; and there are no current or pending legal, governmental or
regulatory actions, suits or proceedings that are required under the Securities Act to be described in a registration statement on Form S-1 to be filed with the Commission (“Form S-1”) that are not so described in each of the Time
of Sale Information and the Offering Memorandum.
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(r) Independent Accountants. PricewaterhouseCoopers LLP (“PWC”), who has
certified certain financial statements of the Company and its subsidiaries, is an independent registered public accounting firm with respect to the Company and its subsidiaries within the applicable rules and regulations adopted by the Commission
and the Public Company Accounting Oversight Board (United States) and as required by the Securities Act.
(s) Title to Real and Personal
Property. The Company and its subsidiaries have good and marketable title in fee simple (in the case of real property) to, or have valid rights to lease or otherwise use, all items of real and personal property that are material to the
respective businesses of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances, claims and defects and imperfections of title except those that (i) do not materially interfere with the use made and proposed to
be made of such property by the Company and its subsidiaries or (ii) would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(t) Title to Intellectual Property. The Company and its subsidiaries own or possess adequate rights to use all material patents, patent
applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures) material to the conduct of their respective businesses, and the conduct of their respective businesses will not conflict in any material respect with any such rights of others. The Company and its subsidiaries have not
received any notice of any claim of infringement or conflict with any such rights of others which could, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(u) No Undisclosed Relationships. No relationship, direct or indirect, exists between or among the Company or any of its subsidiaries,
on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company or any of its subsidiaries, on the other, that would be required by the Securities Act to be described in a Form S-1 and that is not so described in
each of the Time of Sale Information and the Offering Memorandum.
(v) Investment Company Act. Neither the Company nor any of the
Guarantors is, and after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in each of the Time of Sale Information and the Offering Memorandum, none of them will be required to register
as an “investment company” or an entity “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder
(collectively, the “Investment Company Act”).
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(w) Taxes. The Company and its subsidiaries have paid all federal, state, local and
foreign taxes and filed all tax returns required to be paid or filed through the date hereof, except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and except as otherwise disclosed in each
of the Time of Sale Information and the Offering Memorandum, there is no material tax deficiency that has been, or could reasonably be expected to be, asserted against the Company or any of its subsidiaries or any of their respective properties or
assets.
(x) Licenses and Permits. The Company and its subsidiaries possess all licenses, certificates, permits and other
authorizations issued by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities that are necessary for the ownership or lease of their respective properties or the
conduct of their respective businesses as described in each of the Time of Sale Information and the Offering Memorandum, except where the failure to possess or make the same would not, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect; and except as described in each of the Time of Sale Information and the Offering Memorandum, neither the Company nor any of its subsidiaries has received notice of any revocation or modification of any such license,
certificate, permit or authorization.
(y) No Labor Disputes. No labor disturbance by or dispute with employees of the Company or
any of its subsidiaries exists or, to the knowledge of the Company and each Guarantor, is threatened, and neither the Company nor any Guarantor is aware of any existing or imminent labor disturbance by, or dispute with, the employees of any of its
or its subsidiaries’ principal suppliers, contractors or customers, except as would not reasonably be expected to have a Material Adverse Effect.
(z) Compliance with and Liability Under Environmental Laws. (i) The Company and its subsidiaries (a) are in compliance with
any and all applicable federal, state, local and foreign laws, rules, regulations, requirements, decisions, judgments, decrees, and orders relating to the protection of the environment, natural resources or human health or safety, including those
relating to the generation, storage, treatment, use, handling, transportation, Release or threat of Release of Hazardous Materials (collectively, “Environmental Laws”), (b) have received and are in compliance with all permits,
licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses, (c) have not received notice of any actual or potential liability under or relating to, or actual or potential violation
of, any Environmental Laws, including for the investigation or remediation of any Release or threat of Release of Hazardous Materials, and the Company and each of the Guarantors have no knowledge of any event or condition that would reasonably be
expected to result in any such notice, (d) are not conducting or paying for, in whole or in part, any investigation, remediation or other corrective action pursuant to any Environmental Law at any location, and (e) are not a party to any
order, decree or agreement that imposes any obligation or liability under any Environmental Law, and (ii) there are no costs or liabilities associated with Environmental Laws of or relating to the Company or its subsidiaries, except in the case
of each of (i) and (ii) above, for any such matter, as would not, individually or in the aggregate,
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reasonably be expected to have a Material Adverse Effect; and (iii) except as described in each of the Time of Sale Information and the Offering Memorandum, (a) there are no proceedings
that are pending, or that are known to be contemplated, against the Company or any of its subsidiaries under any Environmental Laws in which a governmental entity is also a party, other than such proceedings regarding which it is reasonably believed
no monetary sanctions of $100,000 or more will be imposed, (b) the Company and its subsidiaries are not aware of any facts or issues regarding compliance with Environmental Laws, or liabilities or other obligations under Environmental Laws,
including the Release or threat of Release of Hazardous Materials, that could reasonably be expected to have a material effect on the capital expenditures, earnings or competitive position of the Company and its subsidiaries, and (c) none of
the Company and its subsidiaries anticipates material capital expenditures relating to any Environmental Laws.
(aa) Hazardous
Materials. There has been no storage, generation, transportation, use, handling, treatment, Release or threat of Release of Hazardous Materials by, relating to or caused by the Company or any of its subsidiaries (or, to the knowledge of the
Company and the Guarantors, any other entity (including any predecessor) for whose acts or omissions the Company or any of its subsidiaries is or could reasonably be expected to be liable) at, on, under or from any property or facility now or
previously owned, operated or leased by the Company or any of its subsidiaries, or at, on, under or from any other property or facility, in violation of any Environmental Laws or in a manner or amount or to a location that could reasonably be
expected to result in any liability under any Environmental Law, except for any violation or liability which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. “Hazardous Materials” means
any material, chemical, substance, waste, pollutant, contaminant, compound, mixture, or constituent thereof, in any form or amount, including petroleum (including crude oil or any fraction thereof) and petroleum products, natural gas liquids,
asbestos and asbestos containing materials, naturally occurring radioactive materials, brine, and drilling mud, regulated by a government agency or which can give rise to liability under any Environmental Law. “Release” means any spilling,
leaking, seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing, depositing, dispersing, or migrating in, into or through the environment, or in, into, from or through any building or structure.
(bb) Compliance with ERISA. (i) Each employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”), for which the Company or any member of its “Controlled Group” (defined as any organization which is a member of a controlled group of corporations within the meaning of
Section 414 of the Internal Revenue Code of 1986, as amended (the “Code”)) would have any material liability (each, a “Plan”) has been maintained in all material respects in compliance with its terms and the requirements of
any applicable statutes, orders, rules and regulations, including but not limited to ERISA and the Code, except for noncompliance that could not reasonably be expected to result in material liability to the Company or its subsidiaries; (ii) no
prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect
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to any Plan excluding transactions effected pursuant to a statutory or administrative exemption that could reasonably be expected to result in a material liability to the Company or its
subsidiaries; (iii) neither the Company nor any member of its Controlled Group contributes to, or has an obligation to contribute to, nor has at any time within the preceding five years contributed to or had an obligation to contribute to, a
multiemployer plan within the meaning of Section 4001(a)(3) of ERISA or any other Plan subject to Title IV of ERISA or Section 412 of the Code; and (iv) to the knowledge of the Company and each Guarantor, there is no pending audit or
investigation by the Internal Revenue Service, the U.S. Department of Labor, the Pension Benefit Guaranty Corporation or any other governmental agency or any foreign regulatory agency with respect to any Plan that could reasonably be expected to
result in material liability to the Company or its subsidiaries. There has been no, nor is there expected to be any material increase in the Company and its subsidiaries’ “accumulated post-retirement benefit obligations” (within the
meaning of Statement of Financial Accounting Standards 106) compared to the amount of such obligations in the Company and its subsidiaries’ most recently completed fiscal year.
(cc) Disclosure Controls. The Company and its subsidiaries maintain an effective system of “disclosure controls and
procedures” (as defined in Rule 13a-15(e) of the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed to ensure that information required to be disclosed by the Company in reports that it files or
submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms, including controls and procedures designed to ensure that such information is accumulated and
communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure.
(dd) Accounting
Controls. The Company and its subsidiaries maintain a system of “internal control over financial reporting” (as defined in Rule 13a-15(f) of the Exchange Act) that comply with the requirements of the Exchange Act and have been designed
by, or under the supervision of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences and (v) interactive data in eXtensible Business Reporting Language included or incorporated by reference in each of the Preliminary Offering Memorandum, the Time of Sale Information
and the Offering Memorandum fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s rules and guidelines applicable thereto. Except as disclosed in the
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Preliminary Offering Memorandum, the Time of Sale Information and the Offering Memorandum, there are no material weaknesses in the Company’s internal controls. The Company’s auditors
and the Audit Committee of the Board of Directors of the Company have been advised of: (i) any significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which have adversely
affected or are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and (ii) any fraud, whether or not material, that involves management or other employees who have a
significant role in the Company’s internal controls over financial reporting.
(ee) eXtensible Business Reporting Language. The
interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Preliminary Offering Memorandum, the Time of Sale Information and the Offering Memorandum fairly presents the information called for in all
material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.
(ff)
Insurance. The Company and its subsidiaries have insurance covering their respective properties, operations, personnel and businesses, which insurance is in amounts and insures against such losses and risks as are reasonably adequate to
protect the Company and its subsidiaries and their respective businesses; and neither the Company nor any of its subsidiaries has (i) received notice from any insurer or agent of such insurer that capital improvements or other expenditures are
required or necessary to be made in order to continue such insurance or (ii) believes that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage at reasonable cost from
similar insurers as may be necessary to continue its business.
(gg) No Unlawful Payments. Neither the Company nor any of its
subsidiaries nor, to the knowledge of the Company and each of the Guarantors, any director, officer, agent, employee, or other person acting on behalf of the Company or any of its subsidiaries has (i) used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expense relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated
or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.
(hh) Compliance with Money Laundering Laws. The operations of the Company and its subsidiaries are and have been conducted at all times
in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and
any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any of the Guarantors, threatened.
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(ii) No Conflicts with Sanctions Laws. None of the Company, any of its subsidiaries or, to
the knowledge of the Company or any of the Guarantors, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is currently the subject or the target of any sanctions administered or enforced by the U.S.
Government, (including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”)), the United Nations Security Council (“UNSC”), the European Union, Her Majesty’s
Treasury (“HMT”) (collectively, “Sanctions”), nor is the Company or any of its subsidiaries located, organized or resident in a country or territory that is the subject of Sanctions; and the Company will not
directly or indirectly use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund any activities of
or business with any person, or in any country or territory, that, at the time of such funding, is the subject of Sanctions or (ii) in any other manner that will result in a violation by any person (including any person participating in the
transaction, whether as initial purchaser, advisor, investor or otherwise) of Sanctions.
(jj) No Restrictions on Subsidiaries. No
subsidiary of the Company is currently prohibited, directly or indirectly, under any agreement or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution on such
subsidiary’s capital stock or similar ownership interest, from repaying to the Company any loans or advances to such subsidiary from the Company or from transferring any of such subsidiary’s properties or assets to the Company or any other
subsidiary of the Company, except for any such restrictions that will be permitted by the Indenture.
(kk) No Broker’s Fees.
Neither the Company nor any of its subsidiaries is a party to any contract, agreement or understanding with any person (other than this Agreement) that would give rise to a valid claim against any of them or any Initial Purchaser for a brokerage
commission, finder’s fee or like payment in connection with the offering and sale of the Securities.
(ll) Rule 144A
Eligibility. On the Closing Date, the Securities will not be of the same class as securities listed on a national securities exchange registered under Section 6 of the Exchange Act or quoted in an automated inter-dealer quotation system;
and each of the Preliminary Offering Memorandum and the Offering Memorandum, as of its respective date, contains or will contain all the information that, if requested by a prospective purchaser of the Securities, would be required to be provided to
such prospective purchaser pursuant to Rule 144A(d)(4) under the Securities Act.
(mm) No Integration. Neither the Company nor any
of its affiliates (as defined in Rule 501(b) of Regulation D) has, directly or through any agent, sold, offered for sale, solicited offers to buy or otherwise negotiated in respect of, any security (as defined in the Securities Act), that is or will
be integrated with the sale of the Securities in a manner that would require registration of the Securities under the Securities Act.
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(nn) No General Solicitation or Directed Selling Efforts. None of the Company or any of
its affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no representation is made) has (i) solicited offers for, or offered or sold, the Securities by means of any form of general
solicitation or general advertising within the meaning of Rule 502(c) of Regulation D, other than by means of a Permitted General Solicitation, or in any manner involving a public offering within the meaning of Section 4(a)(2) of the Securities
Act or (ii) engaged in any directed selling efforts within the meaning of Regulation S under the Securities Act (“Regulation S”), and all such persons have complied with the offering restrictions requirement of Regulation S.
(oo) Securities Law Exemptions. Assuming the accuracy of the representations and warranties of the Initial Purchasers contained in
Section 1(b) (including Annex C hereto) and their compliance with their agreements set forth therein, it is not necessary, in connection with the issuance and sale of the Securities to the Initial Purchasers and the offer, resale and
delivery of the Securities by the Initial Purchasers in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum, to register the Securities under the Securities Act or to qualify the Indenture under the
Trust Indenture Act.
(pp) No Stabilization. Neither the Company nor any of the Guarantors has taken, directly or indirectly, any
action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities.
(qq) Margin Rules. Neither the issuance, sale and delivery of the Securities nor the application of the proceeds thereof by the Company
as described in each of the Time of Sale Information and the Offering Memorandum will violate Regulation T, U or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of Governors.
(rr) Forward-Looking Statements. No forward-looking statement (within the meaning of Section 27A of the Securities Act and
Section 21E of the Exchange Act) included or incorporated by reference in any of the Time of Sale Information or the Offering Memorandum has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
(ss) Statistical and Market Data. Nothing has come to the attention of the Company or any Guarantor that has caused the Company or such
Guarantor to believe that the statistical and market-related data included or incorporated by reference in each of the Time of Sale Information and the Offering Memorandum is not based on or derived from sources that are reliable and accurate in all
material respects.
(tt) Sarbanes-Oxley Act. There is and has been no failure on the part of the Company or, to the knowledge of the
Company, any of the Company’s directors or officers, in their capacities as such, to comply with any applicable provision of the Sarbanes-Oxley Act of 2002, as amended, and any applicable rules and regulations promulgated in connection
therewith (the “Sarbanes-Oxley Act”), including Section 402 related to loans and Sections 302 and 906 related to certifications.
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4. Further Agreements of the Company and the Guarantors. The Company and the Guarantors
jointly and severally covenant and agree with each Initial Purchaser that:
(a) Delivery of Copies. The Company will deliver,
without charge, to each of the Initial Purchasers as many copies of the Preliminary Offering Memorandum, any other Time of Sale Information, any Issuer Written Communication and the Offering Memorandum (including all amendments and supplements
thereto) as the Representative may reasonably request.
(b) Offering Memorandum, Amendments or Supplements. Before finalizing the
Offering Memorandum or making or distributing any amendment or supplement to any of the Time of Sale Information or the Offering Memorandum or filing with the Commission prior to the Closing Date any document that will be incorporated by reference
therein, the Company will furnish to the Representative and counsel for the Initial Purchasers a copy of the proposed Offering Memorandum or such amendment or supplement or document to be incorporated by reference therein for review, and will not
distribute any such proposed Offering Memorandum, amendment or supplement or file any such document with the Commission to which the Representative reasonably objects.
(c) Additional Written Communications. Before preparing, using, authorizing, approving or referring to any Issuer Written Communication,
the Company and the Guarantors will furnish to the Representative and counsel for the Initial Purchasers a copy of such Issuer Written Communication for review and will not prepare, use, authorize, approve or refer to any such Issuer Written
Communication to which the Representative reasonably objects.
(d) Notice to the Representative. The Company will advise the
Representative promptly, and confirm such advice in writing, (i) of the issuance by any governmental or regulatory authority of any order preventing or suspending the use of any of the Time of Sale Information, any Issuer Written Communication,
any Permitted General Solicitation or the Offering Memorandum or the initiation or, to the Company’s knowledge, threatening of any proceeding for that purpose; (ii) of the occurrence of any event at any time prior to the completion of the
initial offering of the Securities as a result of which any of the Time of Sale Information, any Issuer Written Communication, any Permitted General Solicitation or the Offering Memorandum as then amended or supplemented would include any untrue
statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing when such Time of Sale Information, Issuer Written Communication, Permitted General
Solicitation or the Offering Memorandum is delivered to a purchaser, not misleading; and (iii) of the receipt by the Company of any notice with respect to any suspension of the qualification of the Securities for offer and sale in any
jurisdiction or the initiation or, to the Company’s knowledge, threatening of any proceeding for such
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purpose; and the Company will use its best efforts to prevent the issuance of any such order preventing or suspending the use of any of the Time of Sale Information, any Issuer Written
Communication, any Permitted General Solicitation or the Offering Memorandum or suspending any such qualification of the Securities and, if any such order is issued, will obtain as soon as possible the withdrawal thereof.
(e) Time of Sale Information. If at any time prior to the Closing Date (i) any event shall occur or condition shall exist as a
result of which any of the Time of Sale Information as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or (ii) it is necessary to amend or supplement the Time of Sale Information to comply with law, the Company will promptly notify the Initial Purchasers thereof and prepare and, subject to
Section 4(b) above, furnish to the Initial Purchasers such amendments or supplements to the Time of Sale Information (or any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the
statements in any of the Time of Sale Information as so amended or supplemented (including such documents to be incorporated by reference therein) will not, in the light of the circumstances under which they were made, be misleading or so that any
of the Time of Sale Information will comply with law.
(f) Ongoing Compliance of the Offering Memorandum. If at any time prior to
the completion of the initial offering of the Securities (i) any event shall occur or condition shall exist as a result of which the Offering Memorandum as then amended or supplemented would include any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, not misleading or (ii) it is necessary to amend or
supplement the Offering Memorandum to comply with law, the Company will promptly notify the Initial Purchasers thereof and prepare and, subject to Section 4(b) above, furnish to the Initial Purchasers such amendments or supplements to the
Offering Memorandum (or any document to be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in the Offering Memorandum as so amended or supplemented (including such document to be
incorporated by reference therein) will not, in the light of the circumstances existing when the Offering Memorandum is delivered to a purchaser, be misleading or so that the Offering Memorandum will comply with law.
(g) Blue Sky Compliance. The Company will qualify the Securities for offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Representative shall reasonably request and will continue such qualifications in effect so long as required for the offering and resale of the Securities; provided that neither the Company nor any of the Guarantors shall
be required to (i) qualify as a foreign corporation, limited partnership, limited liability company or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any
general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.
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(h) Clear Market. During the period from the date hereof through and including the date
that is 45 days after the date hereof, the Company and each of the Guarantors will not, without the prior written consent of the Representative, offer, sell, contract to sell or otherwise dispose of any debt securities issued or guaranteed by the
Company or any of the Guarantors and having a tenor of more than one year.
(i) Use of Proceeds. The Company will apply the net
proceeds from the sale of the Securities as described in each of the Time of Sale Information and the Offering Memorandum under the heading “Use of proceeds.”
(j) Supplying Information. While the Securities remain outstanding and are “restricted securities” within the meaning of Rule
144(a)(3) under the Securities Act, the Company and each of the Guarantors will, during any period in which the Company is not subject to and in compliance with Section 13 or 15(d) of the Exchange Act, furnish to holders of the Securities and
prospective purchasers of the Securities designated by such holders, upon the request of such holders or such prospective purchasers, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(k) DTC. The Company will assist the Initial Purchasers in arranging for the Securities to be eligible for clearance and settlement
through DTC.
(l) No Resales by the Company. The Company will not, and will not permit any of its affiliates (as defined in
Rule 144 under the Securities Act) to, resell any of the Securities that have been acquired by any of them, except for Securities purchased by the Company or any of its affiliates and resold in a transaction registered under the Securities Act.
(m) No Integration. Neither the Company nor any of its affiliates (as defined in Rule 501(b) of Regulation D) will, directly or
through any agent, sell, offer for sale, solicit offers to buy or otherwise negotiate in respect of, any security (as defined in the Securities Act), that is or will be integrated with the sale of the Securities in a manner that would require
registration of the Securities under the Securities Act.
(n) No General Solicitation or Directed Selling Efforts. None of the
Company or any of its affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no representation is made) has (i) solicited offers for, or offered or sold, the Securities by means of any form
of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D without the prior written consent of the Representative or in any manner involving a public offering within the meaning of Section 4(a)(2) of the
Securities Act or (ii) engaged in any directed selling efforts within the meaning of Regulation S under the Securities Act (“Regulation S”), and all such persons have complied with the offering restrictions requirement of
Regulation S.
(o) No Stabilization. Neither the Company nor any of the Guarantors will take, directly or indirectly, any action
designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities.
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5. Certain Agreements of the Initial Purchasers. Each Initial Purchaser hereby represents
and agrees that it has not and will not use, authorize use of, refer to, or participate in the planning for use of, any written communication that constitutes an offer to sell or the solicitation of an offer to buy the Securities other than
(i) the Preliminary Offering Memorandum and the Offering Memorandum, (ii) any written communication that contains either (a) no “issuer information” (as defined in Rule 433(h)(2) under the Securities Act) or
(b) “issuer information” that was included (including through incorporation by reference) in the Time of Sale Information or the Offering Memorandum, (iii) any written communication listed on Annex A or prepared pursuant
to Section 4(c) above (including any electronic road show), (iv) any written communication prepared by such Initial Purchaser and approved by the Company in advance in writing or (v) any written communication relating to or that
contains the terms of the Securities and/or other information that was included (including through incorporation by reference) in the Time of Sale Information or the Offering Memorandum.
6. Conditions of Initial Purchasers’ Obligations. The obligation of each Initial Purchaser to purchase Securities on the Closing
Date as provided herein is subject to the performance by the Company and each of the Guarantors of their respective covenants and other obligations hereunder and to the following additional conditions:
(a) Representations and Warranties. The representations and warranties of the Company and the Guarantors contained herein shall be true
and correct on the date hereof and on and as of the Closing Date; and the statements of the Company, the Guarantors and their respective officers made in any certificates delivered pursuant to this Agreement shall be true and correct on and as of
the Closing Date.
(b) No Downgrade. Subsequent to the earlier of (A) the Time of Sale and (B) the execution and delivery
of this Agreement, (i) no downgrading shall have occurred in the rating accorded the Securities or any other debt securities or preferred stock issued or guaranteed by the Company or any of its subsidiaries by any “nationally recognized
statistical rating organization”, as such term is defined under Section 3(a)(62) under the Exchange Act and (ii) no such organization shall have publicly announced that it has under surveillance or review, or has changed its outlook
with respect to, its rating of the Securities or of any other debt securities or preferred stock issued or guaranteed by the Company or any of its subsidiaries (other than an announcement with positive implications of a possible upgrading).
(c) No Material Adverse Change. No event or condition of a type described in Section 3(e) hereof shall have occurred or shall
exist, which event or condition is not described in each of the Time of Sale Information (excluding any amendment or supplement thereto) and the Offering Memorandum (excluding any amendment or supplement thereto), the effect of which, in the
judgment of the Representative, makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Offering
Memorandum.
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(d) Officer’s Certificate. The Representative shall have received on and as of the
Closing Date a certificate of an executive officer of the Company and of each Guarantor who has specific knowledge of the Company’s or such Guarantor’s financial matters and is satisfactory to the Representative (i) confirming that
such officer has carefully reviewed the Time of Sale Information and the Offering Memorandum and, to the knowledge of such officer, the representations set forth in Sections 3(a) and (b) hereof are true and correct and (ii) confirming that
the other representations and warranties of the Company and the Guarantors in this Agreement are true and correct and that the Company and the Guarantors have complied with all agreements and satisfied all conditions on their part to be performed or
satisfied hereunder at or prior to the Closing Date.
(e) Comfort Letters. On the date of this Agreement and on the Closing Date,
PWC shall have furnished to the Representative, at the request of the Company, letters, dated the respective dates of delivery thereof and addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Representative,
containing statements and information of the type customarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained or incorporated by reference
in each of the Time of Sale Information and the Offering Memorandum; provided that the letter delivered on the Closing Date shall use a “cut-off” date no more than three business days prior to the Closing Date.
(f) Opinion and 10b-5 Statement of Counsel for the Company. Baker Botts L.L.P., counsel for the Company, shall have furnished to the
Representative, at the request of the Company, their written opinion and 10b-5 statement, dated the Closing Date and addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Representative, to the effect set forth in
Annex D-1 hereto.
(g) Opinion of Internal Counsel for the Company. The Senior Vice President, General Counsel and Secretary
of the Company, shall have furnished to the Representative, at the request of the Company, his written opinion, dated the Closing Date and addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Representative, to
the effect set forth in Annex D-2 hereto.
(h) Opinion and 10b-5 Statement of Counsel for the Initial Purchasers. The
Representative shall have received on and as of the Closing Date an opinion and 10b-5 statement, addressed to the Initial Purchasers, of Vinson & Elkins L.L.P., counsel for the Initial Purchasers, with respect to such matters as the
Representative may reasonably request, and such counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters.
(i) No Legal Impediment to Issuance. No action shall have been taken and no statute, rule, regulation or order shall have been enacted,
adopted or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing Date, prevent the issuance or sale of the Securities or the issuance of the Guarantees; and no injunction or order of any federal,
state or foreign court shall have been issued that would, as of the Closing Date, prevent the issuance or sale of the Securities or the issuance of the Guarantees.
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(j) Good Standing. The Representative shall have received on and as of the Closing Date
satisfactory evidence of the good standing of the Company and the Guarantors in their respective jurisdictions of organization and their good standing in such other jurisdictions as the Representative may reasonably request, in each case in writing
or any standard form of telecommunication from the appropriate governmental authorities of such jurisdictions.
(k) Registration Rights
Agreement. The Initial Purchasers shall have received a counterpart of the Registration Rights Agreement that shall have been executed and delivered by a duly authorized officer of the Company and each of the Guarantors.
(l) DTC. The Securities shall be eligible for clearance and settlement through DTC.
(m) Securities. The Securities shall have been duly executed and delivered by a duly authorized officer of the Company and duly
authenticated by the Trustee.
(n) Additional Documents. On or prior to the Closing Date, the Company and the Guarantors shall have
furnished to the Representative such further certificates and documents as the Representative may reasonably request.
All opinions,
letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Initial Purchasers.
7. Indemnification and Contribution.
(a) Indemnification of the Initial Purchasers. The Company and each of the Guarantors jointly and severally agree to indemnify and hold
harmless each Initial Purchaser, its affiliates, selling agents, directors and officers and each person, if any, who controls such Initial Purchaser within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages and liabilities (including, without limitation, reasonable legal fees and other expenses incurred in connection with any suit, action or proceeding or any claim asserted, as such reasonable fees
and expenses are incurred), joint or several, that arise out of, or are based upon, any untrue statement or alleged untrue statement of a material fact contained in the Preliminary Offering Memorandum, any of the other Time of Sale Information, any
Issuer Written Communication, any Permitted General Solicitation or the Offering Memorandum (or any amendment or supplement thereto) or any omission or alleged omission to state therein a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with any information relating to any Initial Purchaser furnished to the Company in writing by such Initial Purchaser through the Representative expressly for use therein.
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(b) Indemnification of the Company and the Guarantors. Each Initial Purchaser agrees,
severally and not jointly, to indemnify and hold harmless the Company, each of the Guarantors, each of their respective directors and officers and each person, if any, who controls the Company or any of the Guarantors within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are
based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such Initial Purchaser furnished to the Company in writing by such Initial Purchaser
through the Representative expressly for use in the Preliminary Offering Memorandum, any of the other Time of Sale Information, any Issuer Written Communication, any Permitted General Solicitation or the Offering Memorandum (or any amendment or
supplement thereto), it being understood and agreed that the only such information consists of the following paragraphs in the Preliminary Offering Memorandum and the Offering Memorandum: the first and second sentences of the third paragraph, the
fourth and fifth sentences of the tenth paragraph and the fourteenth paragraph under the caption “Plan of Distribution.”
(c)
Notice and Procedures. If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any person in respect of which indemnification may be sought pursuant to
either paragraphs (a) or (b) above, such person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification may be sought (the “Indemnifying Person”) in writing;
provided that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have under paragraph (a) or (b) above except to the extent that it has been materially prejudiced (through the
forfeiture of substantive rights or defenses) by such failure; and provided, further, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than
under paragraphs (a) or (b) above. If any such proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably
satisfactory to the Indemnified Person (who shall not, without the consent of the Indemnified Person, be counsel to the Indemnifying Person) to represent in such proceeding the Indemnified Person and any others entitled to indemnification pursuant
to this Section 7 that the Indemnifying Person may designate and shall pay the reasonable fees and expenses of such counsel related to such proceeding, as incurred. In any such proceeding, any Indemnified Person shall have the right to retain
its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying
Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different
from or in addition to those available to the Indemnifying Person; or (iv) the named parties
23
in any such proceeding (including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceeding 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 Persons, and that all such fees and expenses shall be reimbursed as they are incurred. Any such separate firm for any Initial
Purchaser, its affiliates, selling agents, directors and officers and any control persons of such Initial Purchaser shall be designated in writing by J.P. Morgan Securities LLC and any such separate firm for the Company, the Guarantors, their
respective directors and officers and any control persons of the Company and the Guarantors shall be designated in writing by the Company. The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment. No
Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified Person is or could have been a party and indemnification could have
been sought hereunder by such Indemnified Person, unless such settlement (x) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims
that are the subject matter of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any Indemnified Person.
(d) Contribution. If the indemnification provided for in paragraphs (a) or (b) above is unavailable to an Indemnified Person
or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or
payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Guarantors on the one hand and the Initial
Purchasers on the other from the offering of the Securities or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in
clause (i) but also the relative fault of the Company and the Guarantors on the one hand and the Initial Purchasers on the other in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits received by the Company and the Guarantors on the one hand and the Initial Purchasers on the other shall be deemed to be in the same respective proportions as the net
proceeds (before deducting expenses) received by the Company from the sale of the Securities and the total discounts and commissions received by the Initial Purchasers in connection therewith, as provided in this Agreement, bear to the aggregate
offering price of the Securities. The relative fault of the Company and the Guarantors on the one hand and the Initial Purchasers on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue
24
statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or any Guarantor or by the Initial Purchasers and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
(e)
Limitation on Liability. The Company, the Guarantors and the Initial Purchasers agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even if the
Initial Purchasers were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (d) above. The amount paid or payable by an Indemnified
Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified Person in
connection with any such action or claim. Notwithstanding the provisions of this Section 7, in no event shall an Initial Purchaser be required to contribute any amount in excess of the amount by which the total discounts and commissions
received by such Initial Purchaser with respect to the offering of the Securities exceeds the amount of any damages that such Initial Purchaser has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or
alleged 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. The
Initial Purchasers’ obligations to contribute pursuant to this Section 7 are several in proportion to their respective purchase obligations hereunder and not joint.
(f) Non-Exclusive Remedies. The remedies provided for in this Section 7 are not exclusive and shall not limit any rights or
remedies that may otherwise be available to any Indemnified Person at law or in equity.
8. Termination. This Agreement may be
terminated in the absolute discretion of the Representative, by notice to the Company, if after the execution and delivery of this Agreement and on or prior to the Closing Date (i) trading generally shall have been suspended or materially
limited on the New York Stock Exchange or the over-the-counter market; (ii) trading of any securities issued or guaranteed by the Company or any of the Guarantors shall have been suspended on any exchange or in any over-the-counter market;
(iii) a general moratorium on commercial banking activities shall have been declared by federal or New York State authorities; or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial markets
or any calamity or crisis, either within or outside the United States, that, in the judgment of the Representative, is material and adverse and makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Securities on
the terms and in the manner contemplated by this Agreement, the Time of Sale Information and the Offering Memorandum.
25
9. Defaulting Initial Purchaser.
(a) If, on the Closing Date, any Initial Purchaser defaults on its obligation to purchase the Securities that it has agreed to purchase
hereunder, the non-defaulting Initial Purchasers may in their discretion arrange for the purchase of such Securities by other persons satisfactory to the Company on the terms contained in this Agreement. If, within 36 hours after any such default by
any Initial Purchaser, the non-defaulting Initial Purchasers do not arrange for the purchase of such Securities, then the Company shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the
non-defaulting Initial Purchasers to purchase such Securities on such terms. If other persons become obligated or agree to purchase the Securities of a defaulting Initial Purchaser, either the non-defaulting
Initial Purchasers or the Company may postpone the Closing Date for up to five full business days in order to effect any changes that in the opinion of counsel for the Company or counsel for the Initial Purchasers may be necessary in the Time of
Sale Information, the Offering Memorandum or in any other document or arrangement, and the Company agrees to promptly prepare any amendment or supplement to the Time of Sale Information or the Offering Memorandum that effects any such changes. As
used in this Agreement, the term “Initial Purchaser” includes, for all purposes of this Agreement unless the context otherwise requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 9, purchases
Securities that a defaulting Initial Purchaser agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the
purchase of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of all the Securities, then the Company shall have the right to require each non-defaulting Initial Purchaser to purchase the principal amount of Securities that such Initial
Purchaser agreed to purchase hereunder plus such Initial Purchaser’s pro rata share (based on the principal amount of Securities that such Initial Purchaser agreed to purchase hereunder) of the Securities of such defaulting
Initial Purchaser or Initial Purchasers for which such arrangements have not been made.
(c) If, after giving effect to any arrangements
for the purchase of the Securities of a defaulting Initial Purchaser or Initial Purchasers by the non-defaulting Initial Purchasers and the Company as provided in paragraph (a) above, the aggregate principal amount of such Securities that
remains unpurchased exceeds one-eleventh of the aggregate principal amount of all the Securities, or if the Company shall not exercise the right described in paragraph (b) above, then this Agreement shall terminate without liability on the part
of the non-defaulting Initial Purchasers. Any termination of this Agreement pursuant to this Section 9 shall be without liability on the part of the Company or the Guarantors, except that the Company and each of the Guarantors will continue to
be liable for the payment of expenses as set forth in Section 10 hereof and except that the provisions of Section 7 hereof shall not terminate and shall remain in effect.
26
(d) Nothing contained herein shall relieve a defaulting Initial Purchaser of any liability it may
have to the Company, the Guarantors or any non-defaulting Initial Purchaser for damages caused by its default.
10. Payment of
Expenses.
(a) Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated,
the Company and each of the Guarantors jointly and severally agree to pay or cause to be paid all costs and expenses actually incurred and incident to the performance of their respective obligations hereunder, including without limitation,
(i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Securities and any taxes payable in that connection; (ii) the costs incident to the preparation and printing of the Preliminary Offering
Memorandum, any other Time of Sale Information, any Issuer Written Communication, any Permitted General Solicitation and the Offering Memorandum (including any amendment or supplement thereto) and the distribution thereof; (iii) the costs of
reproducing and distributing each of the Transaction Documents and the Indenture; (iv) the fees and expenses of the Company’s and the Guarantors’ counsel and independent accountants; (v) the reasonable fees and expenses incurred
in connection with the registration or qualification and determination of eligibility for investment of the Securities under the state or foreign securities or blue sky laws of such jurisdictions as the Representative may designate and the
preparation, printing and distribution of a Blue Sky Memorandum (including the related reasonable fees and expenses of counsel for the Initial Purchasers); (vi) any fees charged by rating agencies for rating the Securities; (vii) the fees
and expenses of the Trustee and any paying agent (including related fees and expenses of any counsel to such parties); (viii) all expenses and application fees incurred in connection with the approval of the Securities for book-entry transfer
by DTC; and (ix) all expenses incurred by the Company in connection with any “road show” presentation to potential investors (provided that the cost of any aircraft chartered for the road show shall be borne 50% by the Initial
Purchasers). It is understood, however, that except as provided in this Section 10(a), the Initial Purchasers will pay all of their costs and expenses, including fees and disbursements of their counsel, any advertising expenses connected with
any offers they may make and 50% of the cost of any aircraft chartered for the road show.
(b) If (i) this Agreement is terminated
pursuant to clause (ii) of Section 8, (ii) the Company for any reason (other than as a result of clause (i), (iii) or (iv) of Section 8 or Section 9) fails to tender the Securities for delivery to the Initial
Purchasers or (iii) the Initial Purchasers decline to purchase the Securities for any reason permitted under this Agreement, the Company and each of the Guarantors jointly and severally agree to reimburse the Initial Purchasers for all
documented out-of-pocket costs and expenses (including the fees and expenses of their counsel) reasonably incurred by the Initial Purchasers in connection with this Agreement and the offering contemplated hereby.
27
11. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective successors and officers and directors and any controlling persons referred to herein, and the affiliates of each Initial Purchaser referred to in Section 7 hereof. Nothing in this
Agreement is intended or shall be construed to give any other person any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. No purchaser of Securities from any Initial Purchaser shall
be deemed to be a successor merely by reason of such purchase.
12. Survival. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company, the Guarantors and the Initial Purchasers contained in this Agreement or made by or on behalf of the Company, the Guarantors or the Initial Purchasers pursuant to this Agreement or any
certificate delivered pursuant hereto shall survive the delivery of and payment for the Securities and shall remain in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of the Company,
the Guarantors or the Initial Purchasers.
13. Certain Defined Terms. For purposes of this Agreement, (a) except where
otherwise expressly provided, the term “affiliate” has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than a day on which banks are permitted or
required to be closed in New York City; (c) the term “subsidiary” has the meaning set forth in Rule 405 under the Securities Act; (d) the term “written communication” has the meaning set forth in Rule 405
under the Securities Act and (e) the term “significant subsidiary” has the meaning set forth in Rule 1-02 of Regulation S-X under the Exchange Act.
14. Compliance with USA Patriot Act. In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001)), the Initial Purchasers are required to obtain, verify and record information that identifies their respective clients, including the Company, which information may include the name and address of their respective
clients, as well as other information that will allow the Initial Purchasers to properly identify their respective clients.
15.
Miscellaneous.
(a) Authority of the Representative. Any action by the Initial Purchasers hereunder may be taken by J.P.
Morgan Securities LLC on behalf of the Initial Purchasers, and any such action taken by J.P. Morgan Securities LLC shall be binding upon the Initial Purchasers.
(b) Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or
transmitted and confirmed by any standard form of telecommunication. Notices to the Initial Purchasers shall be given to the Representative c/o J.P. Morgan Securities LLC, 383 Madison Avenue, New York, New York 10179 (fax: 212-270-1063); Attention:
Jack Smith. Notices to the Company and the Guarantors shall be given to it at Forum Energy Technologies, Inc., 920 Memorial City Way, Suite 800, Houston, Texas 77024 (fax: (281) 949-2555); Attention: James L. McCulloch.
28
(c) Governing Law. This Agreement and any claim, controversy or dispute arising under or
related to this Agreement shall be governed by and construed in accordance with the laws of the State of New York.
(d) Submission to
Jurisdiction. The Company and each of the Guarantors hereby submit to the exclusive jurisdiction of the U.S. federal and New York state courts in the Borough of Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby. The Company and each of the Guarantors waive any objection which it may now or hereafter have to the laying of venue of any such suit or proceeding in such courts. Each of the
Company and each of the Guarantors agrees that final judgment in any such suit, action or proceeding brought in such court shall be conclusive and binding upon the Company and each Guarantor, as applicable, and may be enforced in any court to the
jurisdiction of which Company and each Guarantor, as applicable, is subject by a suit upon such judgment.
(e) Waiver of Jury Trial.
Each of the parties hereto hereby waives any right to trial by jury in any suit or proceeding arising out of or relating to this Agreement.
(f) Counterparts. This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of
telecommunication), each of which shall be an original and all of which together shall constitute one and the same instrument.
(g)
Amendments or Waivers. No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto.
(h) Headings. The headings herein are included for convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
29
If the foregoing is in accordance with your understanding, please indicate your acceptance of
this Agreement by signing in the space provided below.
|
|
|
| Very truly yours, |
|
| ISSUER: |
|
| FORUM ENERGY TECHNOLOGIES, INC. |
|
|
| By: |
|
/s/ James W. Harris |
| Name: James W. Harris |
| Title: Senior Vice President and
Chief Financial Officer |
|
| GUARANTORS: |
|
| FET HOLDINGS, LLC FORUM ENERGY
SERVICES, INC. SYNTECH TECHNOLOGY, INCORPORATED WIRELINE
SOLUTIONS, L.L.C. |
|
|
| By: |
|
/s/ James W. Harris |
| Name: James W. Harris |
| Title: President |
|
| BLOHM+VOSS OIL TOOLS HOLDING, INC.
BLOHM+VOSS OIL TOOLS, LLC DYNACON, INC.
FORUM GLOBAL TUBING LLC FORUM US, INC.
FORUM INTERNATIONAL HOLDINGS, INC. MERRIMAC MANUFACTURING,
INC. SUBSEA SERVICES INTERNATIONAL, INC. TGH (US)
INC. |
|
|
| By: |
|
/s/ James W. Harris |
| Name: James W. Harris |
| Title: President |
[Signature Page to Purchase Agreement]
|
|
|
| FORUM GLOBAL TUBING LP |
|
|
| By: |
|
FORUM US, INC., |
|
|
its general partner |
|
|
| By: |
|
/s/ James W. Harris |
| Name: James W. Harris |
| Title: President |
|
| GLOBAL FLOW TECHNOLOGIES, INC. Z
EXPLORATIONS, INC. Z RESOURCES, INC. ZY-TECH GLOBAL
INDUSTRIES, INC. |
|
|
| By: |
|
/s/ Douglas Smith |
| Name: Douglas Smith |
| Title: President |
[Signature Page to Purchase Agreement]
|
|
|
| Accepted as of the date first written above.
J.P. MORGAN SECURITIES LLC
For itself and on behalf of the several Initial Purchasers listed in Schedule 1 hereto. |
|
|
| By: |
|
/s/ Jack D. Smith |
| Name: Jack D. Smith |
| Title: Managing Director |
[Signature Page to Purchase Agreement]
Schedule 1
|
|
|
|
|
| Initial Purchaser |
|
Principal Amount |
|
| J.P. Morgan Securities LLC |
|
$ |
25,000,000 |
|
| Wells Fargo Securities, LLC |
|
|
18,000,000 |
|
| Merrill Lynch, Pierce, Fenner & Smith
Incorporated |
|
|
16,000,000 |
|
| Citigroup Global Markets Inc. |
|
|
16,000,000 |
|
| Deutsche Bank Securities Inc. |
|
|
16,000,000 |
|
| HSBC Securities (USA) Inc. |
|
|
6,000,000 |
|
| Comerica Securities, Inc. |
|
|
3,000,000 |
|
| Total |
|
$ |
100,000,000 |
|
Schedule 2
Guarantors
|
|
|
|
|
| Entity |
|
Jurisdiction of Formation |
|
Foreign Qualifications |
|
|
|
| Blohm+Voss Oil Tools Holding, Inc. |
|
Delaware |
|
TX |
|
|
|
| Blohm+Voss Oil Tools, LLC |
|
Delaware |
|
TX |
|
|
|
| Dynacon, Inc. |
|
Texas |
|
— |
|
|
|
| FET Holdings, LLC |
|
Delaware |
|
— |
|
|
|
| Forum Energy Services, Inc. |
|
Delaware |
|
AL, AR, CA, CO, KS, GA, LA, NJ, OK, PA, TX, WA, WY |
|
|
|
| Forum Global Tubing LP |
|
Delaware |
|
— |
|
|
|
| Forum Global Tubing LLC |
|
Delaware |
|
— |
|
|
|
| Merrimac Manufacturing, Inc. |
|
Texas |
|
AR, LA, MS, ND, NM |
|
|
|
| Syntech Technology, Incorporated |
|
Virginia |
|
— |
|
|
|
| Wireline Solutions, L.L.C. |
|
Texas |
|
— |
|
|
|
| Forum US, Inc. |
|
Delaware |
|
AL, AR, CA, CO, FL, KS, GA, IL, LA, MS, ND, NJ, OK, PA, TX, UT, WV, WA, WY |
|
|
|
| Forum International Holdings, Inc. |
|
Delaware |
|
— |
|
|
|
| Subsea Services International, Inc. |
|
Delaware |
|
AL, LA, TX |
|
|
|
| TGH (US) Inc. |
|
Delaware |
|
FL, TX |
|
|
|
| Global Flow Technologies, Inc. |
|
Delaware |
|
IL, TX |
|
|
|
| Z Explorations, Inc. |
|
Delaware |
|
— |
|
|
|
| Z Resources, Inc. |
|
Delaware |
|
— |
|
|
|
| Zy-Tech Global Industries, Inc. |
|
Delaware |
|
CA, CO, GA, KS, LA, NJ, OK, TX, WA |
Schedule 3
Subsidiaries
|
|
|
| ABZ Peru |
|
Peru |
| AMC Engineering Ltd. |
|
United Kingdom |
| BVR GmbH |
|
Germany |
| Blohm + Voss Oil Tools GmbH |
|
Germany |
| Blohm + Voss Oil Tools Holding Inc. |
|
Delaware |
| Blohm + Voss Oil Tools LLC |
|
Delaware |
| Dynacon, Inc. |
|
Texas |
| FET Global Finance Limited |
|
Ireland |
| FET Global Holdings Limited |
|
United Kingdom |
| Forum Global Tubing LLC |
|
Delaware |
| Forum Global Tubing LP |
|
Delaware |
| FET Holdings LLC |
|
Delaware |
| Forum Australia Pty. Ltd. |
|
Australia |
| Forum B+V Oil Tools GmbH |
|
Germany |
| Forum Canada ULC |
|
Canada |
| Forum Energia, Tecnologia, Equipamentos, e Servicos Ltda. |
|
Brazil |
| Forum Energy Asia Pacific Pte. Ltd. |
|
Singapore |
| Forum Energy Services, Inc. |
|
Delaware |
| Forum Energy Solutions de Mexico |
|
Mexico |
| Forum Energy Technologies (UK) Limited |
|
United Kingdom |
| Forum International Holdings, Inc. |
|
Delaware |
| Forum Luxembourg Limited S.a.r.l. |
|
Luxembourg |
| Forum Middle East Limited |
|
British Virgin Islands |
| Forum Oilfield Solutions de Mexico |
|
Mexico |
| Forum Oilfield Technologies De Mexico S de RL |
|
Mexico |
| Forum US, Inc. |
|
Delaware |
| Global Flow Technologies, Inc. |
|
Delaware |
| Merrimac Manufacturing, Inc. |
|
Texas |
| Moffat 2000 Limited |
|
United Kingdom |
| Oilfield Bearing International Limited |
|
United Kingdom |
| Perry Slingsby Systems Ltd. |
|
United Kingdom |
| Pro-Tech Valve Sales |
|
Canada |
| PT Subsea Services Indonesia |
|
Indonesia |
| Subsea Services International, Inc. |
|
Delaware |
| Syntech Technology, Incorporated |
|
Virginia |
| TGH (AP) Pte. Ltd. |
|
Singapore |
| TGH (US) Inc. |
|
Delaware |
|
|
|
| Tube Tec (Tubular Protection Services) Limited |
|
United Kingdom |
| UK Project Support Ltd. |
|
United Kingdom |
| Wireline Solutions, L.L.C. |
|
Texas |
| Z Resources, Inc. |
|
Texas |
| Z Explorations, Inc. |
|
Texas |
| Zy-Tech de Venezuela S.A. |
|
Venezuela |
| Zy-Tech Global Industries, Inc. |
|
Delaware |
| Zy-Tech Valvestock Africa (PTY) Ltd. |
|
South Africa |
ANNEX A
a. Additional Time of Sale Information
1. Term
sheet containing the terms of the Securities, substantially in the form of Annex B.
b. Permitted General Solicitation
1. Press release issued on November 19, 2013.
2. Press
release issued on November 19, 2013.
ANNEX B
Pricing Term Sheet, dated November 19, 2013
to Preliminary Offering Memorandum dated November 19, 2013
Strictly Confidential
Forum Energy Technologies, Inc.
This
pricing term sheet is qualified in its entirety by reference to the Preliminary Offering Memorandum (the “Preliminary Offering Memorandum”). The information in this pricing term sheet supplements the Preliminary Offering Memorandum and
updates and supersedes the information in the Preliminary Offering Memorandum to the extent it is inconsistent with the information in the Preliminary Offering Memorandum. Terms used and not defined herein have the meanings assigned in the
Preliminary Offering Memorandum.
The notes have not been registered under the Securities Act of 1933, as amended, or the securities laws of any other
jurisdiction. The notes may not be offered or sold in the United States or to U.S. persons (as defined in Regulation S) except in transactions exempt from, or not subject to, the registration requirements of the Securities Act. Accordingly, the
notes are being offered only to (1) “qualified institutional buyers” as defined in Rule 144A under the Securities Act and (2) outside the United States to non-U.S. persons in compliance with Regulation S under the Securities Act.
|
|
|
|
|
| Issuer: |
|
Forum Energy Technologies, Inc. |
|
|
| Security description: |
|
6.250% Senior Notes due 2021
The offered securities will be part of the same class of securities as the $300 million aggregate principal amount of such securities issued by the Issuer on
October 2, 2013. |
|
|
| Distribution: |
|
144A and Regulation S with registration rights as set forth in the Preliminary Offering Memorandum |
|
|
| Principal Amount Offered: |
|
$100,000,000 |
|
|
|
| Gross proceeds: |
|
$103,250,000 |
|
|
|
|
| Maturity: |
|
October 1, 2021 |
|
|
|
| Coupon: |
|
6.250% |
|
|
|
|
| Issue price: |
|
103.250% of face amount, plus accrued interest from October 2, 2013 |
|
|
|
| Yield to worst: |
|
5.590% |
|
|
|
|
|
| Spread to Treasury: |
|
+329 bps |
|
|
|
|
| Benchmark: |
|
UST 2.000% due November 15, 2021 |
|
|
| Interest Payment Dates: |
|
April 1 and October 1, commencing April 1, 2014 |
|
|
| Equity clawback: |
|
Up to 35% at 106.250% prior to October 1, 2016 |
|
|
| Optional redemption: |
|
Make-whole call @ T+ 50 bps prior to October 1, 2016 then:
|
|
|
On or after: |
|
Price: |
|
|
October 1, 2016 |
|
104.688% |
|
|
October 1, 2017 |
|
103.125% |
|
|
October 1, 2018 |
|
101.563% |
|
|
October 1, 2019 and thereafter |
|
100.000% |
|
|
|
|
|
|
|
| Change of control (with ratings decline): |
|
Putable at 101% of principal plus accrued interest |
|
|
| Trade date: |
|
November 19, 2013 |
|
|
| Settlement: |
|
T+3; November 22, 2013 |
|
|
| CUSIP and ISIN (144A Notes): |
|
CUSIP: 34984V AA8 ISIN:
US34984VAA89 |
|
|
| CUSIP and ISIN (Reg S Notes): |
|
CUSIP: U02634 AB6 ISIN:
USU02634AB67 |
|
|
|
| Denominations/Multiple: |
|
2,000 x 1,000 |
|
|
|
|
| Bookrunners: |
|
J.P. Morgan Securities LLC Wells
Fargo Securities, LLC Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Citigroup Global Markets Inc. Deutsche Bank Securities
Inc. |
|
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| Co-Managers: |
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HSBC Securities (USA) Inc. Comerica
Securities, Inc. |
This
material is confidential and is for your information only and is not intended to be used by anyone other than you. This information does not purport to be a complete description of these notes or the offering. Please refer to the Preliminary
Offering Memorandum for a complete description.
This communication is being distributed in the United States solely to Qualified Institutional
Buyers, as defined in Rule 144A under the Securities Act of 1933, as amended, and outside the United States solely to Non-U.S. persons as defined under Regulation S.
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities in any jurisdiction to any person to whom it
is unlawful to make such offer or solicitation in such jurisdiction.
Any disclaimer or other notice that may appear below is not applicable to this
communication and should be disregarded. Such disclaimer or notice was automatically generated as a result of this communication being sent by Bloomberg or another email system.
ANNEX C
Restrictions on Offers and Sales Outside the United States
In connection with offers and sales of Securities outside the United States:
(a) Each Initial Purchaser acknowledges that the Securities have not been registered under the Securities Act and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons except pursuant to an exemption from, or in transactions not subject to, the registration requirements of the Securities Act.
(b) Each Initial Purchaser, severally and not jointly, represents, warrants and agrees that:
(i) Such Initial Purchaser has offered and sold the Securities, and will offer and sell the Securities, (A) as part of
their distribution at any time and (B) otherwise until 40 days after the later of the commencement of the offering of the Securities and the Closing Date, only in accordance with Regulation S under the Securities Act (“Regulation
S”) or Rule 144A or any other available exemption from registration under the Securities Act.
(ii) None of such
Initial Purchaser or any of its affiliates or any other person acting on its or their behalf has engaged or will engage in any directed selling efforts with respect to the Securities, and all such persons have complied and will comply with the
offering restrictions requirement of Regulation S.
(iii) At or prior to the confirmation of sale of any Securities sold in
reliance on Regulation S, such Initial Purchaser will have sent to each distributor, dealer or other person receiving a selling concession, fee or other remuneration that purchases Securities from it during the distribution compliance period a
confirmation or notice to substantially the following effect:
“The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons (i) as part of their distribution at any time or
(ii) otherwise until 40 days after the later of the commencement of the offering of the Securities and the date of original issuance of the Securities, except in accordance with Regulation S or Rule 144A or any other available exemption from
registration under the Securities Act. Terms used above have the meanings given to them by Regulation S.”
(iv) Such
Initial Purchaser has not and will not enter into any contractual arrangement with any distributor with respect to the distribution of the Securities, except with its affiliates or with the prior written consent of the Company.
Terms used in paragraph (a) and this paragraph (b) and not otherwise defined in this Agreement have the
meanings given to them by Regulation S.
(c) Each Initial Purchaser acknowledges that no action has been or will be taken by the Company
that would permit a public offering of the Securities, or possession or distribution of any of the Time of Sale Information, the Offering Memorandum, any Issuer Written Communication or any other offering or publicity material relating to the
Securities, in any country or jurisdiction where action for that purpose is required.
(d) Each Initial Purchaser, severally and not
jointly, represents, warrants and agrees that it:
(i) has only communicated or caused to be communicated and will only
communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of Section 21 of the United Kingdom Financial Services and Markets Act 2000 (the “FSMA”)) received by it
in connection with the issue or sale of any Securities in circumstances in which Section 21(1) of the FSMA does not apply to the Company or the Guarantors; and
(ii) has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to
the Securities in, from or otherwise involving the United Kingdom.
ANNEX D-1
Form of Opinion of Counsel for the Company and the Guarantors
ANNEX D-2
Form of Opinion of Internal Counsel for the Company
