Exhibit 10.1

 

Execution Version

CONTRIBUTION AGREEMENT

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This Contribution Agreement (this “Agreement”),  dated as of August 31, 2017, is
made by and among NCS Multistage Holdings, Inc., a Delaware corporation
(“Pioneer Parent”), each of the members of Spectrum Tracer Services, LLC, an
Oklahoma limited liability company (the “Company”), executing this Agreement as
of the date of this Agreement and listed on Exhibit B attached hereto (each of
whom is herein referred to as a “Rollover Company Member” and all of whom are
collectively referred to as the “Rollover Company Members” collectively with
Pioneer Parent, the “Parties”), and solely for the purposes of Article VI
and Section 7.05,  Steve. A. Faurot and Glenn Brown.   

W I T N E S S E T H:

WHEREAS, the Company, Pioneer Parent, Pioneer Investment, Inc., a Delaware
corporation and wholly owned indirect subsidiary of Pioneer Parent
(“Pioneer Investment”), Spartan Merger Sub, LLC, a Delaware limited liability
company and wholly owned subsidiary of Pioneer Investment (“Merger Sub” and
together with Pioneer Parent and Pioneer Investment, each, a “Pioneer Party” and
collectively, the “Pioneer Parties”), and STSR LLC,  an Oklahoma limited
liability company,  solely in its capacity as the Representative (as defined in
the Merger Agreement), previously entered into that certain Agreement and Plan
of Merger, dated as of August 30, 2017, attached hereto as Exhibit A
(the “Merger Agreement” and the transactions contemplated thereby, the
“Merger”), pursuant to which, as of the effective time of the Merger, Pioneer
Investment will acquire the Exchanged Company Units (as defined in the Merger
Agreement) of the Company by merging Merger Sub with and into the Company, with
the Company continuing as the surviving entity in the Merger, in accordance with
the Oklahoma Limited Liability Company Act and the Delaware Limited Liability
Company Act;

WHEREAS, each of the Rollover Company Members currently owns membership
interests in the Company (each such membership interest, a “Company Unit”);

WHEREAS, the Parties desire and the board of directors of Pioneer Parent deems
it advisable and in the best interests of its equityholders to, prior to the
consummation of the Merger, afford each Rollover Company Member the opportunity
to contribute all or a portion of the Company Units held by such Rollover
Company Member to Pioneer Parent in exchange for common stock of Pioneer Parent
(“Pioneer Parent Stock”), the fair market value of which is $19.42 per share
(the “Pioneer Parent Stock Share Price”), and the rights and obligations under
the Merger Agreement; and

WHEREAS, each Rollover Company Member desires to so contribute to Pioneer
Parent, in accordance with the terms of this Agreement, the number of Company
Units held by such Rollover Company Member as is set forth opposite such
Rollover Company Member’s name on Exhibit B (each such Company Unit, a “Rollover
Company Unit”).

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties do hereby agree as follows:

Article I
CONTRIBUTION

Section 1.01    Contribution of Rollover Company Units.  Effective as of the
Closing Date  (as defined below), each Rollover Company Member hereby
contributes, assigns, transfers, conveys and

 

 

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delivers to Pioneer Parent all of such Rollover Company Member’s right, title
and interest in and to the Rollover Company Units held by such Rollover Company
Member, and Pioneer Parent hereby accepts such Rollover Company Units as a
contribution by such Rollover Company Member to the capital of Pioneer Parent.

Section 1.02    Consideration.  As consideration for the contribution by each
Rollover Company Member of such Rollover Company Member’s Rollover Company
Units, each such Rollover Company Member shall have rights and obligations with
respect to such Rollover Company Units pursuant to the Merger Agreement, to
which Pioneer Parent is a party, and Pioneer Parent shall issue the number of
shares of Pioneer Parent Stock to each such Rollover Company Member as is set
forth opposite such Rollover Company Member’s name on Exhibit B, which number of
shares of Pioneer Parent Stock shall be equal to (as to each Rollover Company
Member, such number of shares, the “Share Consideration”) (a) such Rollover
Company Member’s Rollover Consideration (as defined below), divided by (b) the
Pioneer Parent Stock Share Price.  For purposes of the foregoing calculation,
each Rollover Company Member’s “Rollover Consideration” shall be equal to (i)
the Closing Merger Consideration (as defined in the Merger Agreement) that such
Rollover Company Member would have received if the Closing Merger Consideration
had been distributed to the members of the Company immediately prior to the
Closing in accordance with Section 4.8 of the  Operating Agreement of the
Company, dated as of March 1, 2010, as amended by Amendment No. 1, dated as of
February 3, 2015, prior to giving effect to the transactions contemplated by
this Agreement, multiplied by (ii) such Rollover Company Member’s Rollover
Applicable Percentage (as defined in the Merger Agreement) as set forth opposite
such Rollover Company Member’s name on Exhibit B. 

Section 1.03    Withholding.  Notwithstanding any other provision of this
Agreement, Pioneer Parent and its Affiliates shall be entitled to deduct and
withhold, or cause to be deducted and withheld, from any amounts payable or
otherwise deliverable by such Persons to any Rollover Company Member, including
any Share Consideration, such amounts as are required to be withheld with
respect to the payment or distribution of such consideration under any provision
of tax law, and the Rollover Company Members shall indemnify, defend and hold
harmless Pioneer Parent and its Affiliates against liability for any such
amounts. The Rollover Company Members shall cooperate with Pioneer Parent to
minimize the amount of such withholding to the extent permitted by applicable
law.  To the extent that amounts are so withheld, such withheld amounts shall be
treated for all purposes of this Agreement as having been paid or distributed to
the Person to whom such amounts would otherwise have been paid or distributed.
 For the avoidance of doubt, if Pioneer Parent or any of its Affiliates is
entitled to withhold any amount from a Rollover Company Member pursuant to this
Section 1.03 and such Rollover Company Member is entitled to receive cash
consideration pursuant to the Merger Agreement, Pioneer Parent and its
Affiliates shall be entitled to withhold amounts from such cash consideration
(in addition to any amounts withheld pursuant to the Merger Agreement) in lieu
of withholding from the Share Consideration deliverable pursuant to this
Agreement, and such amount shall be treated the same as any other amount
withheld pursuant to the Merger Agreement.

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Article II
CLOSING

Section 2.01    The Closing.  The closing of the transactions contemplated
hereby (the “Closing”) will take place on the date hereof (the “Closing Date”). 

Section 2.02    Closing Deliveries.  At the Closing, (a)  Pioneer Parent shall
deliver to each Rollover Company Member certificates representing the applicable
Share Consideration with such restrictive legends thereon as Pioneer Parent may
reasonably require in connection with this Agreement and the bylaws of Pioneer
Parent and such other deliverables as are required by this Agreement and (b)
each Rollover Company Member shall execute and deliver to Pioneer Parent, a duly
executed letter of transmittal in the form attached hereto as Exhibit C, a fully
completed accredited investor questionnaire in the form attached hereto as
Exhibit D and such other deliverables as are required by this Agreement. 

Article III
REPRESENTATIONS AND WARRANTIES OF PIONEER PARENT

Pioneer Parent represents and warrants the following to the Rollover Company
Members as of the date hereof:

Section 3.01    Organizational Matters.    Pioneer Parent is validly existing
and in good standing under the laws of the State of Delaware; has the requisite
power and authority to own, lease and operate its properties and to carry on its
business as now being conducted; and is duly qualified and in good standing to
do business in each jurisdiction in which the nature of its business or the
ownership or leasing of its properties make such qualification necessary, other
than in such jurisdictions where the failure so to qualify would not impair the
ability of Pioneer Parent to consummate the transactions contemplated in this
Agreement. Copies of the organizational documents, including the certificate of
incorporation and bylaws of Pioneer Parent,  each as in effect on the date of
this Agreement, and the Stockholders Agreement  (collectively, the “Pioneer
Parent Governing Documents”), have been furnished or made available to the
Rollover Company Members. 

Section 3.02    Authority and Due Execution.  Pioneer Parent has the requisite
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder and to consummate the transactions contemplated herein.
 The execution, delivery and performance of this Agreement by Pioneer Parent and
the consummation by Pioneer Parent of the transactions contemplated herein have
been duly authorized by all necessary corporate action or stockholder action on
the part of Pioneer Parent.   No other proceedings on the part of Pioneer Parent
are necessary to approve and authorize the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby. This
Agreement has been, or upon execution and delivery by Pioneer Parent will be,
duly and validly executed and delivered by Pioneer Parent and, assuming that
this Agreement constitutes the valid and binding agreement of the other Parties
hereto, constitutes, or upon execution and delivery will constitute, the valid
and binding obligations of Pioneer Parent, enforceable against Pioneer Parent in
accordance with its terms, subject to applicable bankruptcy, insolvency or other
similar laws relating to or affecting

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the enforcement of creditors’ rights generally and to general principles of
equity (such laws and principles, “Creditors’ Rights”).

Section 3.03    Non-Contravention.    The execution and delivery of this
Agreement does not, and the performance of this Agreement will not (a) conflict
with or violate any of the Pioneer Parent Governing Documents;  (b) conflict
with or violate any applicable law; or (c) result in any breach of or constitute
a default (or an event that with notice or lapse of time or both would become a
breach or default) under, or impair the rights of Pioneer Parent or alter the
rights or obligations of any third party under, or give to others any rights of
termination, amendment, acceleration or cancellation of or give rise to any
preferential purchase right, right of first refusal, right of first offer or
similar right, or result in the creation of a  lien on any of the properties or
assets (whether tangible or intangible) of Pioneer Parent pursuant to any of the
terms, conditions or provisions of any material contract, loan or credit
agreement, note, bond, mortgage, indenture or deed of trust, or any license,
lease, agreement, or other instrument or obligation, to which Pioneer Parent is
a party or by which Pioneer Parent or any material portion of its assets is
bound,  except, with respect to each of clauses (b)  or (c),  such violations,
conflicts, breaches or defaults as would not prevent Pioneer Parent from
consummating the transactions contemplated in this Agreement.

Section 3.04    Consents.   No consent, approval, order or authorization of, or
registration, qualification, or filing with, any governmental authority is
required on the part of Pioneer Parent in connection with the execution,
delivery and performance by Pioneer Parent of this Agreement and the issuance,
sale and delivery of the Share Consideration to the Rollover Company Members,
except (a) such filings which have been or will be made prior to the Closing and
(b) any notices of sale required to be filed with the Securities and Exchange
Commission under Regulation D of the Securities Act of 1933, as amended (the
“Securities Act”), or such post-Closing filings as may be required under
applicable securities laws, which will be timely filed within the applicable
periods therefor.

Section 3.05    Capitalization.  The capitalization of Pioneer Parent at the
time of execution of the Merger Agreement is set forth on Schedule 3.05.    

Section 3.06    Valid Issuance of Pioneer Parent Stock.  The Share Consideration
that is being issued to the Rollover Company Members pursuant to this Agreement,
when issued, sold and delivered in accordance with the terms of this Agreement
and the Pioneer Parent Governing Documents, will be duly and validly issued,
fully paid and nonassessable (except to the extent provided in the Delaware
General Corporation Law), and will be free and clear of all liens, options,
covenants, conditions, restrictions, and other encumbrances other than
restrictions as set forth in this Agreement, the Pioneer Parent Governing
Documents and under applicable securities laws.  Other than as set forth in the
Pioneer Parent Governing Documents, the sale and issuance of the Share
Consideration is not subject to any preemptive rights, rights of first offer or
rights of first refusal.  Other than as set forth in the Pioneer Parent
Governing Documents, such Share Consideration is not subject to any contract
restricting or otherwise relating to the voting, distribution rights or
disposition thereof. 

Section 3.07    SEC Documents; Financial Statements. 

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(a)    Since April 22, 2017, Pioneer Parent has filed or furnished with the U.S.
Securities and Exchange Commission “SEC” all forms, reports, schedules and
statements required to be filed or furnished under the Securities Act or the
Securities Exchange Act of 1934, as amended (“Exchange Act”), respectively (such
forms, reports, schedules and statements, collectively, the “SEC
Documents”).  As of their respective dates, each of the SEC Documents, as
amended, complied as to form in all material respects with the applicable
requirements of the Securities Act, or the Exchange Act, as the case may be, and
the rules and regulations of the SEC thereunder applicable to such SEC
Documents, and none of the SEC Documents contained, when filed or, if amended
prior to the date of this Agreement, as of the date of such amendment with
respect to those disclosures that are amended, any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.    Pioneer Parent has made all
certifications and statements required by Sections 302 and 906 of the
Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) and the related rules and
regulations promulgated thereunder with respect to the SEC Documents.  As of the
date hereof, neither Pioneer Parent nor any of their respective officers has
received notice from any Governmental Authority (as defined in the Merger
Agreement) challenging or questioning the accuracy, completeness, form or manner
of filing of such certifications.  As of the date hereof, there are no
outstanding or unresolved comments received by the Company from the SEC with
respect to any of the SEC Documents.  As of the date hereof, to the knowledge of
the Company, none of the SEC Documents is the subject of ongoing SEC review or
investigation.

(b)    The financial statements of Pioneer Parent included in the SEC Documents,
including all notes and schedules thereto, complied in all material respects,
when filed or if amended prior to the date of this Agreement, as of the date of
such amendment, with the rules and regulations of the SEC with respect thereto,
were prepared in accordance with generally accepted accounting principles in the
United States (“GAAP”) applied on a consistent basis during the periods involved
(except as may be indicated in the notes thereto or, in the case of the
unaudited statements, as permitted by Rule 10-01 of Regulation S-X of the SEC)
and fairly present in all material respects in accordance with applicable
requirements of GAAP (subject, in the case of the unaudited statements, to
normal year-end audit adjustments) the financial position of Pioneer Parent and
its consolidated Subsidiaries,  as of their respective dates and the results of
operations and the cash flows of Pioneer Parent and its consolidated
Subsidiaries, for the periods presented therein.

Section 3.08    Offering.  Assuming the accuracy of each Rollover Company
Member’s representations and warranties set forth in this Agreement, the offer,
sale and issuance of the Share Consideration to the Rollover Company Members
under this Agreement, are exempt from the registration and qualification
requirements of applicable securities laws, including the Securities Act, and
will be issued in compliance with all applicable securities laws.  Neither
Pioneer Parent nor any Person acting on its behalf shall take any action
hereafter that would cause the loss of any such exemption.  Neither Pioneer
Parent nor any Person acting on its behalf has engaged, in connection with the
offering of such Share Consideration, in any form of general solicitation or
general advertising within the meaning of Rule 502(c) under the Securities Act.

Section 3.09    Brokers or Finders.  Pioneer Parent has not directly or
indirectly, entered into any agreement with any individual, corporation, limited
or general partnership, limited

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liability company, association, joint venture, joint stock company, trust,
unincorporated organization, governmental authority or any other entity or any
group comprised of two or more of the foregoing (“Person”) that would obligate
any Rollover Company Member to pay any commission, brokerage fee or “finder’s
fee” in connection with the transactions contemplated herein.

Section 3.10   No Other Representations and Warranties.  Except for the
representations and warranties set forth in this Article III and Article IV of
the Merger Agreement,  Pioneer Parent makes no other express or implied
representation or warranty with respect to itself or with respect to any other
information provided to any Rollover Company Member in connection with this
Agreement, the Merger Agreement and the transactions contemplated hereby and
thereby.

Article IV
REPRESENTATIONS AND WARRANTIES OF THE ROLLOVER COMPANY MEMBERS

Each Rollover Company Member, as to itself, severally and not jointly,
represents and warrants the following to Pioneer Parent as of the date hereof:

Section 4.01    Organizational Matters.  Such Rollover Company Member, if it is
not a natural person, is validly existing and in good standing under the laws of
the jurisdiction of its formation; has the requisite power and authority to own,
lease and operate its properties and to carry on its business as now being
conducted; and is duly qualified and in good standing to do business in each
jurisdiction in which the nature of its business or the ownership or leasing of
its properties make such qualification necessary, other than in such
jurisdictions where the failure so to qualify would not impair the ability of
such Rollover Company Member to consummate the transactions contemplated in this
Agreement.

Section 4.02    Authority and Due Execution.  Such Rollover Company Member, if
it is a natural person, has full capacity and full power and authority or, if it
is not a natural person, has full corporate, limited liability company,
partnership or other applicable power and authority, as the case may be, to
execute and deliver this Agreement and to perform its obligations hereunder and
to consummate the transactions contemplated herein.  Any and all necessary
corporate, limited liability company, partnership or other applicable requisite
action on the part of such Rollover Company Member, if it is not a natural
person, has been authorized for the execution, delivery and performance of this
Agreement or the consummation by such Rollover Company Member of the
transactions contemplated herein.  No other proceedings on the part of such
Rollover Company Member are necessary to approve and authorize the execution and
delivery of this Agreement or the consummation of the transactions contemplated
hereby. This Agreement has been, or upon execution and delivery by such Rollover
Company Member will be, duly and validly executed and delivered by such Rollover
Company Member and, assuming that this Agreement constitutes the valid and
binding agreement of the other Parties hereto, constitutes, or upon execution
and delivery will constitute, the valid and binding obligations of such Rollover
Company Member, enforceable against such Rollover Company Member in accordance
with its terms, subject to applicable Creditors’ Rights.    

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Section 4.03    Non-Contravention.    The execution and delivery of this
Agreement does not, and the performance of this Agreement will not, to the
extent applicable, (a) conflict with or violate any of the organizational or
governing documents of such Rollover Company Member, if such Rollover Company
Member is not a natural person;  (b) conflict with or violate any applicable
law; or (c) result in any breach of or constitute a default (or an event that
with notice or lapse of time or both would become a breach or default) under, or
impair the rights of such Rollover Company Member or alter the rights or
obligations of any third party under, or give to others any rights of
termination, amendment, acceleration or cancellation of or give rise to any
preferential purchase right, right of first refusal, right of first offer or
similar right, or result in the creation of a lien on any of the properties or
assets (whether tangible or intangible) of such Rollover Company Member pursuant
to any of the terms, conditions or provisions of any material contract, loan or
credit agreement, note, bond, mortgage, indenture or deed of trust, or any
license, lease, agreement, or other instrument or obligation, to which such
Rollover Company Member is a party or by which such Rollover Company Member or
any material portion of its assets is bound,  except, with respect to each of
clauses (b) or (c),  such violations, conflicts, breaches or defaults as would
not prevent such Rollover Company Member from consummating the transactions
contemplated in this Agreement.

Section 4.04    Consents.   No consent, approval, order or authorization of, or
registration, qualification, or filing with, any governmental authority is
required on the part of such Rollover Company Member in connection with the
execution, delivery and performance by such Rollover Company Member of this
Agreement and the issuance, sale and delivery of the Rollover Company Units to
Pioneer Parent, except (a) such filings which have been or will be made prior to
the Closing and (b) any notices of sale required to be filed with the Securities
and Exchange Commission under Regulation D of the Securities Act, or such
post-Closing filings as may be required under applicable securities laws, which
will be timely filed within the applicable periods therefor.

Section 4.05    Ownership of Rollover Company Units.  Such Rollover Company
Member has legal and beneficial ownership of, and good and marketable title to,
the Rollover Company Units set forth opposite such Rollover Company Member’s
name on Exhibit B, free and clear of any and all liens, options, covenants,
conditions, restrictions, and other encumbrances other than as set forth in the
organizational documents of the Company and pursuant to applicable securities
laws.  There are no outstanding options, rights, warrants, calls, commitments,
understandings, arrangements, plans or other agreements of any kind created by
such Rollover Company Member in such Rollover Company Member’s individual
capacity or in such Rollover Company Member’s capacity as an agent of the
Company applicable to the Rollover Company Units set forth opposite such
Rollover Company Member’s name on Exhibit B other than as specified in the
organizational documents of the Company.   

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Section 4.06    Investment Representations.

(a)    Such Rollover Company Member is acquiring its respective Share
Consideration for its own account, for investment purposes only, and not with a
view to the distribution, resale or other disposition thereof.

(b)    Such Rollover Company Member has had an opportunity to ask questions and
receive answers concerning the rights and preferences of such Rollover Company
Member’s Share Consideration and the capital structure of Pioneer Parent, and
has had access to such other information concerning such Share Consideration and
Pioneer Parent as such Rollover Company Member may have requested.

(c)    Such Rollover Company Member is an “accredited investor” as defined in
Rule 501(a) under the Securities Act and has provided to Pioneer Parent, prior
to the Closing Date, a fully completed accredited investor questionnaire in the
form set forth as Exhibit E and all information set forth in such accredited
investor questionnaire is true and correct. 

(d)    Such Rollover Company Member recognizes the speculative nature of the
investment in Pioneer Parent Stock and accepts its respective Share
Consideration with full knowledge thereof.  Such Rollover Company Member further
recognizes that an investment in Pioneer Parent Stock is suitable only for
investors who have no need for liquidity in their investment and who will be
able to sustain a complete loss of their investment.  Such Rollover Company
Member is able to bear the economic risk of his, her or its investment in
Pioneer Parent Stock for an indefinite period of time and, at the present time,
is able to afford a complete loss of such investment.

Section 4.07    Brokers or Finders.  Except for the Simmons Engagement Letter
(as defined in the Merger Agreement), such Rollover Company Member has not
directly or indirectly, entered into any agreement with any Person that would
obligate any of the Pioneer Parties or any of their respective subsidiaries or
Affiliates (as defined in the Merger Agreement) to pay any commission, brokerage
fee or “finder’s fee” in connection with the transactions contemplated herein. 

Section 4.08    No Other Representations or Warranties.  Such Rollover Company
Member hereby acknowledges and agrees that, except as and to the extent set
forth in Article III of this Agreement and/or Article IV of the Merger
Agreement,  Pioneer Parent makes no representations or warranties whatsoever to
such Rollover Company Member and such Rollover Company Member hereby disclaims
any reliance on, and Pioneer Parent hereby disclaims all liability and
responsibility for, any representation, warranty, statement, or information
made, communicated, or furnished (orally or in writing) to such Rollover Company
Member or its representatives (including any opinion, information, projection,
or advice that may have been or may be provided to such Rollover Company Member
by any director, officer, employee, agent, consultant, or representative of such
Party or any Affiliate thereof). 

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Article V
INDEMNIFICATION

Section 5.01    Merger Agreement Indemnification Provision.  Each of the Parties
hereby acknowledges and agrees that any claims brought pursuant to this
Agreement shall be subject to and governed by, to the extent applicable, the
indemnification provisions contained in Article XI of the Merger Agreement and
such provisions are hereby incorporated by reference into the terms of this
Agreement.

Article VI
COVENANTS

Section 6.01    Non-Competition; Non-Solicitation. 

(a)    Each of Steve Faurot and Glenn Brown (each a “Restricted Person”) agrees
that during the period commencing on the Closing Date and continuing until the
fifth anniversary thereof (the “Restricted Period”), such Restricted Person will
not, directly or indirectly, own, operate, manage, control, participate in, have
any interest in, be employed or engaged in any capacity by, consult with,
advise, permit such Restricted Person’s name to be used by, provide services
for, or in any manner engage in the Business (as defined below) (including by
such Restricted Person alone or in association with any Person) within the
Restricted Area (as defined below), including, but not limited to, providing
services or products to any Covered Customer (as defined below) that are similar
to or competitive with the services or products provided or offered as part of
the Business or engaging in any activity that is in competition with the
Business within the Restricted Area. Notwithstanding the foregoing, (a)  nothing
in this Section 6.01(a) shall be deemed to diminish, amend, affect or otherwise
modify any other non-competition agreement or covenant binding on such
Restricted Person and (b) nothing in this Section 6.01(a) shall prohibit such
Restricted Person from owning securities having no more than 2% of the
outstanding voting power of any publicly traded competitor, or participating as
a passive investor in a private investment fund so long as such Restricted
Person does not have any active or managerial roles with respect to such
investment, and such private investment fund does not own more than 2% of any
publicly traded company engaged in the business of Pioneer Parent, the Company
or any of their Affiliates. 

(b)    Non-Solicitation. Each Restricted Person agrees that during the
Restricted Period, such Restricted Person will not, directly or indirectly, on
behalf of himself or any other Person (i) solicit, canvass, approach, entice or
induce any Covered Customer to cease or lessen such Covered Customer’s business
with, or to refrain from doing business with the Company or any of its
Affiliates or (ii) solicit, canvass, approach, entice or induce any employee or
contractor of Pioneer Parent, the Company or any of their Affiliates to
terminate his, her or its employment or engagement therewith.

(c)    Consideration; Enforcement.  The Restricted Persons acknowledge and agree
that the covenants set forth in this Section 6.01 are an express incentive to
induce Pioneer Parent to enter into this Agreement and the Pioneer Parties to
enter into the Merger Agreement, both of which constitute contracts pursuant to
which Restricted Persons are selling interests in a business or part of a
business and for which they are receiving valuable consideration.  Restricted

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Persons further acknowledge that immediately prior to this Agreement and the
Merger Agreement, the Restricted Persons  were substantial equityholders of the
Company and were directly and materially associated with the Company’s goodwill,
and that pursuant to this Agreement and the Merger Agreement, and, in connection
with the transactions contemplated hereby and thereby,  each Restricted Person
has sold such Restricted Person’s goodwill in the Company and all of such
Restricted Person’s interest in the Company. The Parties and the Restricted
Persons agree and acknowledge that the Business is conducted throughout the
Restricted Area and the limitations as to time, geographic area and scope of
activity to be restrained as set forth in this Section 6.01 are reasonable and
do not impose any greater restraint than is necessary to protect the legitimate
business interests of the Company and its Affiliates, including the protection
of the goodwill transferred by the Restricted Persons pursuant to the
transaction associated with this Agreement and the Merger Agreement, and that
these limitations are intended to comply with the provisions of all applicable
laws. The Parties and each Restricted Person further agree and acknowledge that,
in the event of a breach or threatened breach by either or both of the
Restricted Persons of any of the provisions of this Section 6.01, Pioneer
Parent, the Company and their Affiliates shall, individually or collectively, be
entitled to seek injunctive relief, as any such breach would cause Pioneer
Parent, the Company and their Affiliates irreparable injury for which they would
have no adequate remedy at law. The Restricted Persons also agree to waive any
requirement for the security or posting by the Restricted Persons of any bond in
connection with any such remedy. Nothing herein shall be construed so as to
prohibit Pioneer Parent, the Company or any of their Affiliates, collectively or
individually, from pursuing any other remedies available hereunder, at law or in
equity, for any such breach or threatened breach, including disgorgement of the
sums received by the Restricted Persons as a result of their entry into this
Agreement. The Restricted Persons further acknowledge and agree that no failure
or delay by any of Pioneer Parent, the Company or their Affiliates in exercising
any right, power or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege
hereunder. The Parties agree that the foregoing restrictions in this Section
6.01 are reasonable in all respects and that any breach of the covenants
contained in this Section 6.01 would cause irreparable injury to Pioneer Parent,
the Company and their Affiliates. Nevertheless, if any of the aforesaid
restrictions are found by a court or arbitrator of competent jurisdiction to be
unreasonable, or overly broad as to scope, geographic area or time, or otherwise
unenforceable, the Parties and each Restricted Person intend for the
restrictions set forth in this Section 6.01 to be modified by the court or
arbitrator making such determination so as to be reasonable and enforceable to
the maximum extent permitted by law and, as so modified, to be fully enforced.
By agreeing to this contractual modification prospectively at this time, the
Parties and each Restricted Person intend to make this provision enforceable
under the law or laws of all applicable states and other jurisdictions so that
the entire Section 6.01 as prospectively modified shall remain in full force and
effect and shall not be rendered void or illegal.

(d)    Definitions.  For the purposes of this Article VI:

(i)     “Business” means the business and operations that are the same or
similar to those performed by the Company and any of its Affiliates as of the
date hereof, which shall include the development, manufacturing, selling,
marketing, servicing and licensing of downhole completions technology utilizing
casing-installed sleeves, including toe sleeves; downhole completions technology
utilizing abrasive perforation techniques; coiled tubing

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multistage fracturing and restimulation; casing floatation buoyancy technology;
oil and gas reservoir engineering services; waterflood/EOR management technology
utilizing sliding sleeves; downhole wellbore monitoring systems; composite
bridge plugs and frac plugs; reservoir analysis and completions diagnostics
services utilizing chemical, radioactive, or other tracers; production
allocation services utilizing chemical tracers, and any business or operations
in which the Company or any of its Affiliates have made material preparations to
engage as of the date hereof.

(ii)    “Covered Customer” means (A) any Person who is a customer of the Company
or any of its Affiliates as of the Closing Date, (B) any Person who was a
customer of the Company or any of its Affiliates at any time during the 12-month
period before the Closing Date and (C) any Person who is a prospective customer
of the Company or any of its Affiliates to whom the Company or any of its
Affiliates is actively marketing their products or services as of the Closing
Date.

(iii)   “Restricted Area” means any geographic area that is within a 50-mile
radius of (A) any facility owned or operated by, or any well site in which
operations are conducted by, the Company or any its Affiliates, or at which any
of their downhole tools are utilized by their Covered Customers, in each case,
within the United States, Russia, China, Argentina or Canada as of the Closing
Date; or (B) any facility or well site at which the Company or any of its
Affiliates has material plans to operate, or at which their Covered Customers
operate, in each case, within the United States, Russia, China, Argentina or
Canada as of the Closing Date.  Notwithstanding the foregoing, should a court or
arbitrator apply Oklahoma law to this Article VI,  each Restricted Person agrees
that the restrictions on each Restricted Person’s activities within those
portions of the Restricted Area located within the State of Oklahoma shall be
defined as (1) Oklahoma County, (2) Tulsa County and (3) all counties contiguous
to each of Oklahoma County and Tulsa County.

Section 6.02    Lock-Up. Each Rollover Company Member agrees not to effect any
public sale or private offer or distribution of any Pioneer Parent Stock held by
such Rollover Company Member until October 25, 2017. Notwithstanding the
foregoing, this Section 6.02 shall not apply to any sale by a Rollover Company
Member or a director or officer of a Rollover Company Member of shares of
Pioneer Parent Stock acquired in open market transactions or block purchases by
such Rollover Company Member or its affiliates subsequent execution of this
Agreement. Any discretionary waiver or reduction of the requirements under the
foregoing provisions made by Pioneer Parent shall apply to each Rollover Company
Member on a pro rata basis.

Article VII
GENERAL PROVISIONS

Section 7.01    Further Assurances.  From time to time, as and when reasonably
requested by a Party, the other Parties shall execute and deliver, or cause to
be executed and delivered, all such documents and instruments and shall take, or
cause to be taken, all such further or other actions, which documents,
instruments or actions are consistent with, and customary and necessary for, the
consummation of the transactions contemplated by this Agreement and the other
Transaction Documents (as such term is defined in the Merger Agreement).    

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Section 7.02    Entire Agreement.  This Agreement and the Merger Agreement
(which terms shall be deemed to include the exhibits and schedules hereto and
thereto and the other certificates, documents and instruments delivered
hereunder and thereunder)  constitute the entire agreement of the Parties and
supersede all prior agreements, letters of intent and understandings, both
written and oral, among the Parties with respect to the subject matter of this
Agreement.

Section 7.03    Parties in Interest.  This Agreement shall be binding upon and
inure solely to the benefit of each Party and its successors and permitted
assigns.  Nothing in this Agreement is intended to confer upon any other Person
any rights or remedies of any nature whatsoever under or by reason of this
Agreement except as expressly set forth herein.  From and after the Closing, all
of the express third party beneficiaries shall be entitled to enforce such
provisions and to avail themselves of the benefits of any remedy for any breach
of such provisions, all to the same extent as if such Persons were parties to
this Agreement.

Section 7.04    Assignment.  Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the Parties,
whether by operation of law or otherwise. Any assignment in violation of the
foregoing shall be null and void; provided,  however, that Pioneer Parent and
its Affiliates may, without the consent of any Person, assign in whole or in
part its rights and obligations pursuant to this Agreement (a) to one or more of
its Affiliates or (b) to any purchaser of all or any portion of the assets or
business of Pioneer Parent or any of its Affiliates or to any of their financing
sources as collateral security, provided,  however, that, in the case of
clause (a), Pioneer Parent remains liable under this Agreement.

Section 7.05    Governing Law, Venue; Waiver of Jury Trial.  All questions
concerning the construction, validity and interpretation of this Agreement and
the exhibits to this Agreement will be governed by and construed in accordance
with the domestic laws of the State of Delaware, without giving effect to any
choice of law or conflict of law provision or rule (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Delaware. The Parties and each
Restricted Person hereby irrevocably and unconditionally submit in any legal
action or proceeding arising out of or relating to this Agreement to the
exclusive jurisdiction of either a state court located in the County of Harris,
Texas, with subject matter jurisdiction over the action or the United States
District Court, Southern District of Texas, U.S.A. and, in any such action or
proceeding, consent to jurisdiction in such courts and waive any objection to
the venue in any such court. AS A SPECIFICALLY BARGAINED INDUCEMENT FOR EACH
PARTY AND EACH RESTRICTED PERSON TO ENTER INTO THIS AGREEMENT (EACH PARTY HAVING
HAD OPPORTUNITY TO CONSULT COUNSEL), EACH PARTY AND EACH RESTRICTED PERSON
EXPRESSLY: (I) WAIVES THE RIGHT TO TRIAL BY JURY IN ANY PROCEEDING RELATING TO
OR ARISING IN ANY WAY FROM THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED IN
THIS AGREEMENT, AND (II) AGREES THAT SUIT TO ENFORCE ANY PROVISION OF THIS
AGREEMENT OR TO OBTAIN ANY REMEDY WITH RESPECT HERETO SHALL BE BROUGHT
EXCLUSIVELY IN THE STATE OR FEDERAL COURTS LOCATED IN HARRIS COUNTY, STATE OF
TEXAS, U.S.A., OR THE UNITED STATES DISTRICT COURT FOR TEXAS, SOUTHERN DISTRICT,
AND EACH PARTY AND EACH RESTRICTED PERSON HERETO EXPRESSLY AND IRREVOCABLY
CONSENTS TO THE JURISDICTION OF SUCH COURTS.

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Section 7.06    Amendment and Modification.  This Agreement may be amended only
by a written agreement executed by the Parties,  provided,  however,  that no
amendment shall be made which by applicable law requires further approval by a
Party’s stockholders or members, as applicable, without such further approval.

Section 7.07    Waiver of Compliance.  Any Party’s failure to comply with any
obligation, covenant, agreement or condition contained herein may be waived only
if set forth in an instrument in writing signed by the Party or Parties to be
bound by such waiver,  but such waiver or failure to insist upon strict
compliance with such obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any other failure.  

Section 7.08    Counterparts.  This Agreement may be executed and delivered
(including by .pdf, email or facsimile transmission) in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the Parties and delivered to the other Parties, it being understood that all
Parties need not sign the same counterpart. 

Section 7.09    Rules of Construction.    

(a)    Each of the Parties acknowledges that it has been represented by legal
counsel of its choice throughout all negotiations that have preceded the
execution of this Agreement and that it has executed the same with consent and
upon the advice of said independent counsel.  Each Party and its counsel
cooperated in the drafting and preparation of this Agreement and the documents
referred to herein, and any and all drafts relating thereto shall be deemed the
work product of the Parties and may not be construed against any Party by reason
of its preparation. Accordingly, any rule of law or any legal decision that
would require interpretation of any ambiguities in this Agreement against any
Party that draft it is of no application and is hereby expressly waived.

(b)    The specification of any dollar amount in this Agreement is not intended
and shall not be deemed to be an admission or acknowledgment of the materiality
of such amounts or items, nor shall the same be used in any dispute or
controversy between the Parties to determine whether any obligation, item or
matter (whether or not described herein or included in any schedule) is or is
not material for purposes of this Agreement.

(c)    All references in this Agreement to Exhibits, Schedules, Articles,
Sections, subsections and other subdivisions refer to the corresponding
Exhibits, Schedules, Articles, Sections, subsections and other subdivisions of
this Agreement unless expressly provided otherwise.  Titles appearing at the
beginning of any Articles, Sections, subsections or other subdivisions of this
Agreement are inserted for convenience only, do not constitute any part of such
Articles, Sections, subsections or other subdivisions, and shall be disregarded
in construing the language contained therein.  The words “this Agreement,”
“herein,” “hereby,” “hereunder” and “hereof” and words of similar import, refer
to this Agreement as a whole and not to any particular subdivision unless
expressly so limited.  The words “this Section,” “this subsection” and words of
similar import, refer only to the Sections or subsections hereof in which such
words occur.  The word “including” (in its various forms) means “including,
without limitation.”  The word “or” shall have the inclusive meaning represented
by the phrase “and/or.”  Pronouns in masculine,

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feminine or neuter genders shall be construed to state and include any other
gender and words, terms and titles (including terms defined herein) in the
singular form shall be construed to include the plural and vice versa, unless
the context otherwise expressly requires.  Unless the context otherwise
requires, all defined terms contained herein shall include the singular and
plural and the conjunctive and disjunctive forms of such defined terms.  Unless
the context otherwise requires, all references to a specific time shall refer to
Central Time.  All references to “$” are to U.S. dollars. The words “ordinary
course of business” shall mean ordinary course of business, consistent with past
custom and practice, including with respect to timing, frequency and magnitude.

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[Signature Pages Follow]  

 

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IN WITNESS WHEREOF, this Agreement has been duly executed by each of the Parties
as of the date and year first above written.

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PIONEER PARENT:

 

NCS MULTISTAGE HOLDINGS, INC.

 

 

By:  /s/ Robert Nipper

Name:  Robert Nipper

Title:    Chief Executive Officer

 

 

 

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Rollover Company Members:

 

 

SHELLEY R. FAUROT TRUST DATED 12/19/2014

 

By:      /s/ Shelley R. Faurot

Name:  Shelley R. Faurot

Title:    Trustee

 

 

 

STEVE A. FAUROT TRUST DATED 12/19/2014

 

By:      /s/ Steve A. Faurot

Name:  Steve A. Faurot

Title:    Trustee

 

 

 

 

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CHINOOK CAPITAL LLC

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By:      /s/ Glenn Brown

Name:  Glenn Brown

Title:    Manager

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AGREED TO AND ACKNOWLEDGED, for the good and valuable consideration, received by
the Shelley R. Faurot Trust Dated 12/19/2014 and the Steve A. Faurot Trust Dated
12/19/2014, on behalf of the undersigned, the receipt and sufficiency of which
are hereby acknowledged. 

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SOLELY FOR PURPOSES OF Article VI and Section 7.05:  

 

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/s/ Steve Faurot

Steve A. Faurot

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AGREED TO AND ACKNOWLEDGED, for the good and valuable consideration, received by
Chinook Capital LLC, on behalf of the undersigned, the receipt and sufficiency
of which are hereby acknowledged. 

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SOLELY FOR PURPOSES OF Article VI and Section 7.05:  

﻿

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/s/ Glenn Brown

Glenn Brown

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Contribution Agreement

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