EXECUTION VERSION

 

SHARES PURCHASE EXCHANGE AGREEMENT

 

This Shares Purchase Exchange Agreement (“Agreement”) is entered into on June 5,
2018 (“Effective Date”) between Hana Investments Co. WLL, formed under the laws
of Bahrain and with its registered address at Office 205, Building 111, Manama
Center, Road 383, Block 304, Bahrain (“Olayan”) and National Energy Services
Reunited Corp, a company incorporated in the British Virgin Islands with its
registered address at 171 Main Street, Road Town, Tortola, VB1110, British
Virgin Islands (“NESR”) (each of Olayan and NESR to be referenced hereafter as a
“Party” or collectively as “Parties”). Capitalized terms not defined in this
Agreement shall have the meaning as set forth in the SPA (as defined below). Any
reference in this Agreement to “$” shall mean U.S. dollars.

 

WHEREAS, the Parties have entered into that certain Stock Purchase Agreement (as
may be amended, restated or supplemented from time to time, the “SPA”), dated
November 12, 2017, among NESR, Olayan, OFS Investments Limited, Arab Petroleum
Investments Corporation, Castle SPC Limited, Al Nowais Investments LLC,
Abdulaziz Aldelaimi, Fahad Abdulla Bindekhayel and NPS Holdings Limited
(“Company”);

 

WHEREAS, pursuant to the SPA, Olayan acquired the legal and beneficial ownership
of 83,660,878 shares, par value $1.00 per share, of the Company (the “Olayan
Company Shares”);

 

WHEREAS, on the NESR Closing Date, Olayan has agreed to contribute the legal and
beneficial ownership of the Olayan Company Shares to NESR, and NESR has agreed
to acquire the legal and beneficial ownership of the Olayan Company Shares, on
the terms and subject to the conditions set out in this Agreement (“Closing”);
and

 

WHEREAS, NESR has agreed to issue certain Shares (as defined below) to Olayan as
consideration for the Olayan Company Shares and to make certain payments or
issue certain additional Shares to Olayan on the terms and subject to the
conditions set out in this Agreement.

 

W I T N E S S E T H

 

NOW THEREFORE, in consideration of the premises, the sufficiency and adequacy of
which is hereby acknowledged, the Parties agree as follows:

 

1.                  Contribution. Subject to consummation of the NESR Closing,
and subject to the terms of this Agreement, Olayan, on the NESR Closing Date,
shall contribute to NESR, and NESR shall acquire from Olayan, the legal and
beneficial ownership of the Olayan Company Shares free and clear from any
encumbrance, including but not limited to any security interest, adverse claim,
right to acquire, or restriction on the use, voting, transfer or receipt of
income (“Encumbrance”), and together with all legal and beneficial rights and
benefits attached or accruing to them on the NESR Closing Date, including any
right to receive dividends or distributions declared, made or paid on or after
the NESR Closing Date.

 

   

 

 

2.Consideration.

 

a.                   In exchange for receipt of the Olayan Company Shares and in
accordance with Clause 2.8 of the SPA, on the NESR Closing Date, NESR shall
issue to Olayan 13,340,448 shares of NESR Common Stock.

 

b.                  Each Party shall preserve the right to recover any
Pre-Olayan Closing Adjustment Leakage, Pre-NESR Closing Adjustment or Disputed
Leakage, as applicable, pursuant to the SPA. If, with Olayan written consent,
NESR is able to recover, after deduction of reasonable recovery costs, any
Pre-Olayan Closing Adjustment Leakage, then NESR shall promptly transfer such
amount of Pre-Olayan Closing Adjustment Leakage to Olayan. NESR shall make such
payment to Olayan either by wire transfer of immediately available funds or
through the issuance to Olayan or its designated Affiliate of an equivalent
amount in shares of NESR Common Stock valued at $11.244 per share, in the sole
discretion of NESR. The aggregate shares of NESR Common Stock issued to Olayan
pursuant to Clauses 2.a and 2.b (Consideration) (but not Clause 2.c) hereof
shall collectively be referred to as the “Lock-Up Shares.”

 

c.                   On the NESR Closing Date, NESR shall pay to Olayan interest
accruing at the rate of 9.5% per annum on the amount paid by Olayan to purchase
the Olayan Company Shares, up to an amount of $4,700,000 (the “Interest
Amount”), which represents the total interest payable to Olayan on the Olayan
Initial Cash Consideration Amount. On the NESR Closing Date, NESR shall have the
right in its sole discretion either to pay the Interest Amount in cash or to
issue to Olayan or its designated Affiliate 418,001 shares of NESR Common Stock
in full satisfaction of this obligation (the aggregate shares of NESR Common
Stock issued to Olayan pursuant to this Clause 2.c. (Consideration) shall be
referred to as the “Non-Lock-Up Shares” and the Lock-Up Shares and the
Non-Lock-Up Shares shall collectively be referred to as the “Shares”).

 

d.                  NESR shall issue all the Common Stock issuable hereunder to
Olayan or an Affiliate of Olayan as designated by Olayan in writing, free and
clear of all Encumbrances, but subject to restrictions on transfer generally
arising under applicable U.S. federal or state securities law and, in the case
of the Lock-Up Shares, the Lock-Up (as defined below). Upon request by Olayan, a
certificate, signed by a duly authorized officer of NESR will be delivered to
Olayan or its designated Affiliate at the NESR Closing Date evidencing
appropriate book entries to the account holder designated by Olayan.

 

e.                   NESR acknowledges that, pursuant to the terms of the SPA,
Olayan is under no obligation to pay any Olayan Daily Amount. For the avoidance
of doubt, under no circumstances shall Olayan or its Affiliates be held liable
for or required to pay any Olayan Daily Amount and NESR shall not, and shall
cause its Affiliates not to, make any claim in respect of the foregoing.

 

3.                  Relationship Agreement. On the NESR Closing Date, Olayan and
NESR shall enter into that certain Relationship Agreement, in the agreed form
attached as Exhibit A (Relationship Agreement), pursuant to which, as of the
NESR Closing Date, and in accordance with the terms set forth therein, (i)
Olayan shall have the right to nominate one director to the board of NESR and
(ii) Olayan shall be restricted from transferring the Lock- Up Shares for a
period of six (6) months following the NESR Closing Date (the “Lock-Up”). For
the avoidance of doubt, the Non Lock-Up Shares shall not be subject to the
Lock-Up.

 

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4.                  Registration Rights. The Shares will be covered by that
certain Registration Rights Agreement, in the agreed form attached as Exhibit B
(Registration Rights Agreement), to be entered into on the NESR Closing Date
between NESR and Olayan.

 

5.                  Listing of NESR Shares. NESR shall take all necessary action
to cause the Shares to be approved for listing on Nasdaq, subject to official
notice of issuance, prior to the Closing.

 

6.                  Taxes. The Parties hereby agree and acknowledge that any
transfer, stamp, stock transfer, documentary, registration, filing, recording
and other similar taxes, levies, imposts, duties, deductions, withholdings
(including backup withholding), assessments, fees or other charges imposed by
any governmental authority, including any interest, additions to tax or
penalties applicable thereto (“Conveyance Taxes”), that may be imposed as a
result of the acquisition of the Olayan Company Shares by NESR from Olayan
and/or the issuance of the Shares to Olayan as contemplated by this Agreement
shall be borne entirely by NESR. Conveyance Taxes do not include any income
taxes imposed upon a Party arising from the transactions contemplated by this
Agreement, which income taxes shall be the sole responsibility of the Party upon
whom the obligation is imposed by law. The Party or Parties required to do so by
applicable law shall prepare and file (with the reasonable cooperation of the
other Party) all necessary returns (including any information returns), reports,
statements, declarations, estimates, schedules, notices, notifications, forms,
certificates or other documents with respect to Conveyance Taxes. The Parties
agree to cooperate in the execution and delivery of all instruments and
certificates necessary to comply with any Conveyance Tax filing requirements or
to be entitled to any exemptions from (or reductions in) Conveyance Taxes in
connection with the acquisition of the Olayan Company Shares by NESR from Olayan
and/or the issuance of the Shares to Olayan.

 

7.Pre-Closing Covenants.

 

a.                   Olayan undertakes to NESR that it shall not dispose of or
otherwise create, grant, extend or permit to subsist any Encumbrance over all or
any portion of the Olayan Company Shares (other than to NESR pursuant to this
Agreement) and that if any Encumbrance shall attach to such shares Olayan shall
take all necessary measures to remove them before the NESR Closing Date.

 

b.                  Except with respect to this Agreement, between the Effective
Date and the NESR Closing Date, Olayan shall not, and each of its
representatives, directors, managers, employees, agents and advisors shall not:

 

i.solicit, initiate, consider, encourage or accept any other proposals or offers
from, or provide any information to, any party in respect of the sale of all or
part of the Olayan Company Shares; or

 

ii.enter into any agreement (or grant any option or right) to sell, transfer or
otherwise legally and/or beneficially dispose of the Olayan Company Shares; or

 

iii.enter into any discussions, conversations, negotiations or other
communications with any third party in respect of the foregoing.

 

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c.                   From the date of this Agreement through the NESR Closing
Date, NESR shall use all reasonable best efforts that are necessary or desirable
for NESR to remain listed as a public company on, and for shares of NESR Common
Stock to be tradable over, the applicable Nasdaq market(s) and such other
exchange or trading market as the NESR Common Stock is then listed.

 

d.                  Olayan and NESR shall execute, perform and do (or procure to
be executed, performed and done by third parties as necessary) all such deeds,
documents, procedures, acts and things as are necessary for such Party to carry
out the provisions of this Agreement and to consummate and make effective the
transactions contemplated by this Agreement.

 

e.                   Each Party shall promptly (and in any event before the NESR
Closing Date) notify the other Party in writing of anything of which the
notifying Party is or becomes aware which renders, or is likely to render, any
of its Warranties untrue, inaccurate or misleading.

 

8.Undertaking, Representations and Warranties.

 

a.                   Each Party represents and warrants to the other Party that
each of the following statements (“Warranties”) is true, accurate and not
misleading as of the Effective Date and represents and warrants that they will
be true, accurate and not misleading at the NESR Closing Date as if repeated
immediately prior to the NESR Closing Date:

 

i.It is duly organized, validly existing and in good standing under the laws of
the state or jurisdiction of its incorporation and has all requisite corporate
power and authority to own, lease and operate its properties and carry on its
business.

 

ii.It has full corporate power, legal capacity and authority to execute and
deliver this Agreement and each other agreement, document, instrument or
certificate contemplated by this Agreement or to be executed by it in connection
with the consummation of the transactions contemplated hereby and thereby. The
execution, delivery and performance by such Party of this Agreement have been
duly authorized by all necessary corporate action on behalf of such Party. This
Agreement has been duly executed and delivered by such Party and (assuming the
due authorization, execution and delivery by the other Party hereto) this
Agreement constitutes the legal, valid and binding obligation of such Party,
enforceable against such Party in accordance with its terms.

 

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iii.None of the execution and delivery by such Party of this Agreement, the
consummation of the transactions contemplated hereby, or the compliance by such
Party with any of the provisions hereof will conflict with, or result in
violation of or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination or cancellation under any
provision of: (i) the certificate of incorporation and bylaws or comparable
organizational documents of such Party; (ii) any Contract or Permit to which
such Party is party or by which any of the properties or assets of such Party
are bound; (iii) any Order of any Governmental Body applicable to such Party or
by which any of the properties or assets of such Party are bound; or (iv) any
applicable law.

 

iv.No consent, waiver, approval, Order, Permit or authorization of, or
declaration or filing with, or notification to, any person or Governmental Body
is required on the part of such Party in connection with the execution and
delivery of this Agreement, the compliance by such Party with any of the
provisions hereof or the consummation of the transactions contemplated hereby.

 

b.                  NESR warrants to Olayan that, except as publicly disclosed
as of the date hereof, neither NESR nor any of its subsidiaries:

 

i.has any outstanding liabilities other than supplier, debt, contract labor, or
professional fees;

 

ii.has any obligations or commitments of any nature whatsoever under or in
connection with any agreement, arrangement or understanding;

 

iii.is in breach of any applicable law, including in respect of any filings
required to be made by it with the SEC; or

 

iv.is party to any pending or threatened civil, criminal, arbitration,
administrative or other proceedings against it.

 

c.                   NESR warrants to Olayan that all information contained in
the Proxy, at the time: (i) the Proxy (or any amendment thereof or supplement
thereto) is first mailed to the stockholders of NESR; (ii) of the NESR
Stockholders’ Meeting; and (iii) of the Closing, will be true and accurate in
all material respects and the Proxy will not fail to state any material fact
required to be stated therein or necessary in order to make the statements
therein complete and not misleading.

 

d.                  NESR warrants to Olayan that no Equity Stock has been issued
or transferred by any member of NESR or its subsidiaries or agreed to be issued
or transferred by NESR for a price that is less than $10 per Equity Stock, and
NESR has not issued or agreed to issue any instrument that is convertible into,
or exercisable or exchangeable for, or which gives the right to subscribe for,
Equity Stock or that entitles its holder to be issued or subscribe for Equity
Stock for a price that is less than $10 per Equity Stock.

 

e.                   The Warranties set forth in this section shall not in any
respect be extinguished or affected by the Closing.

 

f.                    Each Party acknowledges that the other Party has entered
into this Agreement in reliance on, among other things, the Warranties contained
in this Agreement.

 

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9.Indemnities.

 

a.                   Without prejudice to any other right or remedy available to
Olayan, NESR agrees and undertakes to fully indemnify, keep indemnified and hold
harmless Olayan from and against any losses, damages, liabilities, claims,
taxes, diminution of value, interest, awards, judgments, penalties, costs or
expenses (including legal and other professional fees, costs and out-of-pocket
expenses incurred in investigating, preparing or defending the foregoing)
(collectively, “Losses”) asserted against, suffered or incurred from time to
time by Olayan arising out of or resulting from any breach of NESR’s covenants
or agreements herein or any Warranty made by NESR in this Agreement.

 

b.                  Without prejudice to any other right or remedy available to
NESR, Olayan agrees and undertakes to fully indemnify, keep indemnified and hold
harmless NESR from and against any Losses asserted against, suffered or incurred
from time to time by NESR arising out of or resulting from any breach of
Olayan’s covenants or agreements herein or any Warranty made by Olayan in this
Agreement.

 

c.                   NESR’s liability in respect of any indemnity claim against
NESR, and Olayan’s liability in respect of any indemnity claim against Olayan,
covered under a policy of insurance shall be reduced by any amount recovered
under such policy of insurance which recovery the policy holder will make all
reasonable efforts to obtain (net of expenses incurred in obtaining such
recovery, including any insurance premium increase).

 

d.                  No Party shall be entitled to recover damages in respect of
any Claim or otherwise obtain reimbursement or restitution more than once in
respect of the same Loss.

 

e.                   Where the matter or default giving rise to a Claim is
capable of remedy, the Indemnified Party (as defined below) shall procure that
the Indemnifying Party (as defined below) is given the opportunity, within
fifteen (15) business days after the date on which notice of such Claim is given
to the Indemnifying Party to remedy the relevant matter or default (if capable
of remedy).

 

f.                    Nothing in this section shall limit indemnification
resulting from any fraud or willful misconduct on the part of NESR or Olayan.

 

10.Indemnity Claims.

 

a.                   In respect of any claim for indemnification pursuant to
Clause 9 (Indemnities) (a “Claim”) with respect to which a Party (the
“Indemnifying Party”) is obligated to indemnify the other Party (the
“Indemnified Party”):

 

i.The Indemnified Party shall notify the Indemnifying Party in writing of any
Claim within sixty (60) business days after the Indemnified Party becomes aware
of the event giving rise to the Claim. The Indemnified Party shall in its notice
to the Indemnifying Party specify the Claim amount, if known, and explain in
reasonable detail (to the extent such information is available at the time of
the relevant Claim) the matter which gives rise to the relevant Claim (although
failure to give such detail shall not invalidate the notice of such Claim);
provided that the failure to provide (or to timely provide) such notice will not
affect the Indemnified Party’s right to indemnification;

 

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ii.The Indemnifying Party, acting reasonably, following receipt of a Claim and
in any event no later than thirty (30) days thereof, shall either:

 

A.notify the Indemnified Party in writing that it intends to dispute the Claim,
or

 

B.accept such Claim and confirm the same in writing (the “Acceptance Letter”)
and make payment to the Indemnified Party of the Claim in settlement of all
liabilities arising from such Claim within a period of a further three (3) days
from the date of the Acceptance Letter.

 

b.                  During a period of thirty (30) days following the giving of
the notice by the Indemnifying Party under Clause 10.a.ii.A. (Indemnity Claims),
NESR and Olayan shall attempt to resolve any differences which they may have
with respect to any matters constituting the subject matter of such notice. If,
at the end of such period, the Parties fail to reach an agreement in writing
with respect to all such matters, then all matters as to which an agreement is
not so reached may be resolved pursuant to Clause 20 (Governing Law and
Jurisdiction).

 

c.                   The Indemnified Party shall not be entitled to initiate
proceedings in respect of a Claim after the expiry of a term of twelve (12)
months after the date on which the Indemnified Party gives notice pursuant to
Clause 10.a.i. (Indemnity Claims) in relation to that Claim.

 

11.              Costs and Expenses. The costs and expenses incurred by the
Parties in relation to the negotiation, preparation and consummation of this
Agreement, including but not limited to respective attorneys’ fees in connection
thereto shall be borne by the Party incurring such expenses.

 

12.              Investment Decisions. Olayan represents and warrants to NESR
that Olayan is an accredited investor and that it has experience in dealing in
investments similar to the acquisition of the Olayan Company Shares or the
Shares. Olayan acknowledges and confirms that, with the exception of the
Warranties made by NESR in this Agreement, it is not relying upon any
representations made by NESR and that it is relying exclusively upon the terms
of the Prospectus filed in connection with the IPO of NESR, the Proxy and its
understanding of the business and financial affairs of the Company. Olayan has
had the right to request from NESR any information that it may require to fully
analyze this investment in the Company, and in NESR if the exchange occurs, and
NESR will promptly share any requested information with Olayan available to NESR
for Olayan to make its own investment decision, subject to the execution of a
non-disclosure agreement before the information may be shared. Olayan
understands that NESR shares are valued at an agreed price that could be in
excess of or less than the market price of the NESR shares on the date of
exchange.

 

13.              Successors, Transfers and Assignment. This Agreement shall be
binding upon and inure to the benefit of the Parties hereto and their respective
successors and assigns; and each Party shall have the right to assign this
Agreement and its rights and obligations hereunder to an Affiliate upon written
notice to the other Party; provided, however, that no such assignment shall
relieve such Party of any of its obligations hereunder.

 

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14.              Amendment to the Agreement. This Agreement may be amended,
waived or modified only by an instrument in writing signed by each of the
Parties hereto.

 

15.              Counterparts. This Agreement may be executed in any number of
counterparts. A Party may enter into this Agreement by executing a counterpart,
but this Agreement shall not be effective until each Party has executed at least
one (1) counterpart. Each counterpart shall constitute an original of this
Agreement but all the counterparts together constitute the same instrument.

 

16.              Remedies and Waivers. No breach by either Party of any
provision of this Agreement shall be waived or discharged, except with the
express written consent of the other Party. No failure or delay by a Party in
exercising any right, power or privilege under this Agreement or at law shall
operate as a waiver of that right, power or privilege and no single or partial
exercise by a Party of any right, power or privilege shall preclude any further
exercise of that right, power or privilege or the exercise of any other right,
power or privilege of such Party under this Agreement or any applicable laws.
The rights, benefits and remedies provided in this Agreement are cumulative.

 

17.              Termination. This Agreement may be terminated (i) by Olayan if
the Condition is not capable of being satisfied at any time or the Condition is
not satisfied by June 30, 2018, (ii) by either Party if the SPA is terminated in
accordance with its terms, or (iii) by a mutual written agreement signed by each
of the Parties. Except for the provisions specifically provided for in this
Agreement that shall survive termination, this Agreement shall forthwith become
void and there shall be no further liability on the part of any Party for such
termination.

 

18.              Invalidity. If any term or other provision of this Agreement is
invalid, illegal, or incapable of being enforced by any law or public policy,
all other terms or provisions of this Agreement shall nevertheless remain in
full force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially
adverse to any Party. Upon such determination that any term or other provision
is invalid, illegal, or incapable of being enforced, the Parties shall negotiate
in good faith to modify this Agreement so as to effect the original intent of
the Parties as closely as possible in an acceptable manner in order that the
transactions contemplated hereby are consummated as originally contemplated to
the greatest extent possible.

 

19.              Confidentiality. Each Party agrees that the terms of this
Agreement shall be considered confidential information and the Parties shall not
disclose the existence of this Agreement or any of its terms to any third party,
either during the term of this Agreement or for a period of two (2) years
following the NESR Closing Date, and only disclose such information to such of
its directors, officers, employees, agents or professional advisers who have a
need to know such information. The confidentiality provisions in this Clause 19
(Confidentiality) shall not apply if and to the extent that such disclosure is
required for the purpose of any judicial proceedings or by any regulatory
authority, governmental body or applicable securities exchange. The requirements
of this Clause 19 (Confidentiality) shall survive termination of this Agreement.

 

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20.              Governing Law and Jurisdiction. The laws of the State of New
York shall apply to construe and interpret the terms of this Agreement. In the
event of any dispute or failure to perform by either Party, the Parties agree to
submit any dispute to the federal courts of the State of New York for
resolution, and each Party hereby agrees to and submits to any court with proper
jurisdiction in the State of New York. Because damages may not be an adequate
remedy for failure to perform, the Parties agree that either may seek injunctive
relief for enforcement of the provision or this Agreement in the federal courts
of the State of New York or any court of competent jurisdiction. The Parties
agree that no bond shall be required by the Party seeking injunctive relief.

 

21.              NESR Trust. Olayan acknowledges that it has read the Prospectus
and that NESR has established the NESR Trust from the proceeds of its initial
public offering (“IPO”) and from certain private placements occurring
simultaneously with the IPO for the benefit of NESR’s public shareholders
(“Public Shareholders”) and certain parties (including the underwriters of the
IPO) and that, except for a portion of the interest earned on the amounts held
in the NESR Trust, NESR may disburse monies from the NESR Trust only: (i) to the
Public Shareholders in the event they elect to redeem NESR common stock in
connection with the consummation of NESR’s initial business combination (as such
term is used in the Prospectus) (“business combination”), (ii) to the Public
Shareholders if NESR fails to consummate a business combination within
twenty-four (24) months from the closing of the IPO, (iii) in any amounts
necessary to pay any taxes or (iv) to, or on behalf of, NESR after or
concurrently with the consummation of a business combination. Olayan hereby
agrees that it does not now and shall not at any time hereafter have (other than
its rights upon Closing) any right, title, interest or claim of any kind
pursuant to this Agreement in or to any monies in the NESR Trust or
distributions therefrom, or make any claim prior to Closing against the NESR
Trust, regardless of whether such claim arises based on contract, tort, equity
or any other theory of legal liability. Olayan hereby irrevocably waives any
claims it may have under this Agreement against the NESR Trust (including any
distributions therefrom) now or in the future as a result of, or arising out of,
this Agreement and will not, prior to the Closing, seek recourse against the
NESR Trust (including any distributions therefrom) in connection with any
alleged breach of this Agreement. For the avoidance of doubt, this Clause 21
(NESR Trust) will be limited solely to this Agreement and shall not affect
Olayan’s or its Affiliates’ (including Competrol Establishments’) other rights
with respect to the NESR Trust under law, other agreements or otherwise, in
effect prior to or after the date hereof. Further, for the avoidance of doubt,
notwithstanding anything to the contrary contained herein, the waivers under
this Clause 21 (NESR Trust) will continue to apply at and after the Closing to
distributions made to redeeming Public Shareholders and for transaction expenses
paid (including deferred expenses payable to NESR’s underwriters in connection
with the IPO). Olayan agrees and acknowledges that such irrevocable waiver is
material to this Agreement and specifically relied upon by NESR to induce it to
enter into this Agreement.

 

22.              Amendment to SPA. NESR agrees that it shall not agree to any
amendment, supplement, change, modification or waiver of any term of the SPA
(including the exhibits and schedules annexed thereto or referred to therein)
without the prior written consent of Olayan.

 

[Signature Page to Follow]

 

 9 

 

 

Agreed by the Parties or their duly authorized representatives on the date
written above on the first page.

 

HANA INVESTMENTS CO. WLL       By:  /s/ Saleh A Al Enazi   Printed Name: Saleh A
Al Enazi   Title:   Authorized signatory  

 

[shares_001.jpg]

 

[Signature Page to Shares Purchase Exchange Agreement ]

 

 

 

 

Exhibit A

Relationship Agreement

 

 

 

 

EXECUTION VERSION

 

June 5, 2018

 

NATIONAL ENERGY SERVICES REUNITED CORP.

 

NESR HOLDINGS LIMITED

 

HANA INVESTMENTS CO. WLL

 

 

 

RELATIONSHIP AGREEMENT

 

 

 

 

 

 

CONTENTS

 

Section   Page       1. Commencement and Duration 1       2. Governance 2      
3. Lock-Up 3       4. Confidentiality 4       5. Announcements 5       6.
Notices 6       7. Costs and Interest 6       8. Whole Agreement 6       9.
Assignment 7       10. Variations 7       11. Invalid Terms 8       12.
termination 8       13. Enforceability, Rights and Remedies 8       14.
Counterparts 9       15. Governing Law 9       16. Jurisdiction; WAIVER OF TRIAL
BY JURY 9       Schedule 1 Definitions and Interpretation 10

 

i

 

 

RELATIONSHIP AGREEMENT

 
dated June 5, 2018

 

PARTIES:

 

(1)NATIONAL ENERGY SERVICES REUNITED CORP., a company existing under the laws of
the British Virgin Islands with its registered address at 171 Main Street, Road
Town, Tortola, VB 1110, British Virgin Islands (the “Company”);

 

(2)NESR HOLDINGS LIMITED, a company existing under the laws of the British
Virgin Islands with its registered address at 171 Main Street, Road Town,
Tortola, VB 1110, British Virgin Islands (“NESR Holdings”); and

 

(3)HANA INVESTMENTS CO. WLL, a company existing under the laws of Bahrain with
its registered address at Office 205, Building 111, Manama Center, Road 383,
Block 304, Bahrain (“Olayan”).

 

Words and expressions used in this Relationship Agreement (the “Agreement”)
shall be interpreted in accordance with Schedule 1 (Definitions and
Interpretation).

 

WHEREAS:

 

(A)The Company, Olayan, NPS Holdings Limited (“NPS”), and the Selling
Stockholders (as defined in the SPA) have entered into that certain Stock
Purchase Agreement, dated as of November 12, 2017 (as may be amended, restated
or supplemented from time to time, the “SPA”), pursuant to which Olayan acquired
83,660,878 shares, par value $1.00 per share, of NPS (the “NPS Shares”);

 

(B)The Company and Olayan have entered into that certain Shares Purchase
Exchange Agreement, dated as of June 5, 2018 (as may be amended, restated or
supplemented from time to time, the “SPEA”), pursuant to which, on the NESR
Closing Date, Olayan agreed to contribute the legal and beneficial ownership of
the NPS Shares to the Company in exchange for the issuance by the Company of the
Shares, on the terms and subject to the conditions set forth in the SPEA;

 

(C)The Company, NESR Holdings and Olayan are entering into this Agreement in
order to set out (i) certain rights to which Olayan will be entitled as a
shareholder of the Company and (ii) certain obligations of NESR Holdings as a
significant shareholder of the Company; and

 

(D)In consideration of the mutual covenants and agreements contained in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:

 

IT IS AGREED:

 

1.Commencement and Duration

 

All clauses and schedules in this Agreement shall take effect immediately upon
the NESR Closing. Once in force, the provisions of this Agreement shall continue
in force and shall bind the Parties from time to time until this Agreement is
terminated.

 

1

 

 

2.Governance

 

2.1As of the NESR Closing, the Company and NESR Holdings shall take all
Necessary Action to cause the Board to include, so long as Olayan and its
Affiliates collectively hold, in the aggregate, at least 6,879,225 Common Shares
(subject to appropriate adjustment for any stock dividends, splits, reverse
splits, combinations, recapitalizations and the like occurring after the date
hereof) one Director nominated by Olayan (the “Olayan Nominee”). Olayan shall
have the right to propose to remove any such Olayan Nominee and nominate another
person in his/her place for so long as Olayan and its Affiliates hold the
applicable number of Common Shares specified in this Section 2.1. The first
Olayan Nominee shall be Hala Zeibak.

 

2.2As of the NESR Closing, Olayan shall have the right to nominate, and the
Company and NESR Holdings shall take all Necessary Action to cause the Company
senior management to include, one Executive Vice President designated by Olayan
who shall oversee all of the Company’s operations (the “Olayan EVP”). If the
Olayan EVP is removed, resigns or otherwise ceases employment for any reason,
Olayan shall have the right to propose to the Board a replacement so long as
Olayan and its Affiliates collectively hold, in the aggregate, the number of
Common Shares specified in Section 2.1 hereof; provided, however, that the
appointment of each replacement shall be subject to the approval of the Board.
The Olayan EVP shall report directly to the Company Chief Executive Officer.

 

2.3The Company and NESR Holdings shall take all Necessary Action to procure that
the appointment of the Olayan Nominee, Hala Zeibak, is proposed to and
recommended for approval by the Company’s shareholders at the 2018 annual
general meeting of the Company (the “2018 AGM”) or at any other general meeting
of the Company held before the 2018 AGM. The Company and NESR Holdings shall
procure that the appointment of the Olayan Nominee to the Board is proposed to
and recommended for approval by the Company’s shareholders at each subsequent
annual general meeting of the Company so as to ensure the appointment or
re-appointment of the Olayan Nominee pursuant to the terms hereof.

 

2.4If any Olayan Nominee is not elected at the applicable annual general meeting
of the Company referred to in Section 2.3 above, Olayan shall have the right to
propose a replacement Olayan Nominee for appointment to the Board. The Company
and NESR Holdings shall take all Necessary Action to ensure that such
replacement Olayan Nominee is proposed to and recommended at the next
shareholders meeting of the Company. The process set out in this Section 2.4
shall be repeated until the replacement Olayan Nominee is appointed to the
Board.

 

2.5In addition, if Olayan wishes to remove any Olayan Nominee and nominate
another person in his/her place pursuant to Section 2, the Company and NESR
Holdings shall take all Necessary Action to appoint such replacement Olayan
Nominee to the Board as soon as possible and in any event shall take all
Necessary Action to propose and recommend the appointment of such replacement at
the next annual general meeting of the Company following any such nomination.

 

2.6During any period between the NESR Closing and the appointment of the Olayan
Nominee to the Board, the Olayan Nominee shall, for so long as Olayan shall have
the right to an Olayan Nominee, be entitled to attend meetings of the Board in
the capacity of an observer with the right to speak and participate in
discussions of the Board, but without any voting rights, and the Company shall
provide the Olayan Nominee with written notice of all Board Meetings and all
Board papers on the same basis as notices and Board papers are provided to the
Directors.

 

2

 

 

2.7 Olayan acknowledges that the Company will require:

(a)the Olayan Nominee appointed to the Board and any committee of the Board to
accept in writing, on substantially the same terms as accepted in writing by the
other non-executive Directors, to be bound by and duly comply with applicable
Law and the Articles;

(b)the Olayan Nominee appointed to the Board to accept in writing, on
substantially the same terms as accepted in writing by the other non-executive
members of the Board or such committees, to keep confidential all information
regarding the Company Group of which they become aware in their respective
capacities; and

(c)any Olayan Nominee that acts as an observer, to accept in writing, to keep
confidential all information regarding the Company Group of which he/she become
aware in his/her capacity.

 

2.8If any Olayan Nominee dies, resigns, retires or is incapacitated and is
removed as a Director, Olayan shall have the right to appoint another Director
in accordance with this Section 2.

 

2.9The Olayan Nominee may be appointed to committees of the Company as such
Olayan Nominee may qualify, subject to Board approval.

 

2.10The Company shall purchase and maintain with a reputable insurer insurance
effective from and including the NESR Closing Date, for or for the benefit of
any person who is or was at any time a Director or director or officer of any
member of the Company Group, including insurance against, subject to Law, any
liability incurred by or attaching to him/her in respect of any act or omission
in the actual or purported exercise of his/her powers, in each case from and
including the NESR Closing Date (or, if later, the date of appointment of such
Director or director or officer of any member of the Company Group), and
otherwise in relation to his/her duties, powers or offices in relation to any
member of the Company Group (and all costs, charges, losses, expenses and
liabilities incurred by him/her in relation thereto).

 

2.11NESR Holdings shall not, directly or indirectly, grant any proxy or enter
into or agree to be bound by any voting trust, agreement or arrangement of any
kind with respect to the Common Shares if and to the extent the terms thereof
conflict with the provisions of this Agreement (whether or not such proxy,
voting trust, agreement or agreements are with holders of Common Shares that are
not Parties to this Agreement or otherwise).

 

2.12In addition to the rights of Olayan with respect to the Olayan Nominee set
forth in this Section 2, Olayan shall have the right to request that Company
management nominate a second person selected by Olayan (“Second Director”) for
election to the Board. The person nominated shall be submitted by management for
consideration by the Board, in the case of a replacement Director or Board
expansion to accommodate the Second Director, or by the Company shareholders, in
the case of an annual general meeting election; provided that management
consents to the person selected, which consent shall not be unreasonably
withheld. The actual election of a requested Second Director, or expansion of
the size of the Board, shall be subject to the discretion of the Board or the
Company shareholders, as the case may be.

 

3

 

 

3.Lock-Up

 

3.1Olayan agrees with the Company that for a period of six (6) months from the
NESR Closing Date (the “Lock-Up Period”), Olayan shall not, and will cause its
Affiliates to which Olayan transfers any Lock-Up Shares not to, directly or
indirectly (i) offer, sell, issue, contract to sell, pledge or otherwise dispose
of, directly or indirectly, any Lock-Up Shares; (ii) offer, sell, issue,
contract to sell or grant any option, right or warrant to purchase the Lock-Up
Shares or securities convertible into or exchangeable for the Lock-Up Shares; or
(iii) enter into a transaction which would have the same effect, or enter into
any swap, hedge or other arrangement that transfers, in whole or in part, any of
the economic consequences of ownership of the Lock-Up Shares or securities
convertible into or exchangeable for any Lock-Up Shares, whether any such
aforementioned transaction is to be settled by delivery of Lock-Up Shares or
such other securities, in cash or otherwise. The provisions of this Section 3
shall not prevent Olayan from granting security in respect of any Lock-Up Shares
to any provider of finance to Olayan or any Affiliate of Olayan; provided Olayan
shall remain entitled to vote in respect of the Lock-Up Shares upon the grant of
such security.

 

3.2Each of NESR Holdings and the Company represents, warrants and agrees that
(i) they have not entered into any agreement with any of the Selling
Stockholders prohibiting any form of disposition of any interest in the Common
Shares (“lock-up agreement”) that has a shorter duration than the Lock-Up
Period; (ii) each such lock- up agreement is in full force and effect and shall
not be waived by any party thereto; and (iii) all officers, directors,
affiliates and shareholders holding five percent (5%) or more of the Common
Shares acquired in private sale transactions that have any contractual
restrictions as a legally valid and binding lock-up agreement have terms with
the same duration or a longer duration than the Lock-Up Period, except as
otherwise disclosed in the Proxy Statement.

 

4.Confidentiality

 

4.1The Parties shall keep confidential any information which relates to the
contents of, and negotiations leading to, this Agreement (or any agreement,
disclosures or arrangement entered into pursuant to this Agreement) (all such
information being “Confidential Information”).

 

4.2The obligations under Section 4.1 do not apply to:

(a)any disclosure of information which is expressly consented to in writing by
each of the Parties prior to such disclosure being made (or, if the information
only relates to one Party, which is expressly consented to in writing by such
Party);

(b)disclosure (subject to Section 4.3) in confidence by any Party to its
Affiliates or to such Party’s and its Affiliates’ directors, officers,
employees, agents and advisers (together the “Representatives” and each a
“Representative”);

 

4

 

 

(c)disclosure of information to the extent required by Law or by any stock
exchange or Governmental Authority, or to the extent reasonably required for the
purpose of managing the tax affairs of Olayan (or any of its Affiliates), NESR
Holdings (or any of its Affiliates) or any member of the Company Group;

(d)disclosure of information on a confidential basis to a bank or financial
adviser of Olayan or one or more bona fide potential purchasers of Shareholder
Instruments or any securities in Olayan or in any of its Affiliates;

(e)disclosure of information which was lawfully in the possession of each of the
Parties or any of their Representatives without any obligation of secrecy prior
to it being received or held;

(f)disclosure of any information which has previously become publicly available
other than through any Party’s fault (or that of its Representatives) (as
applicable);

(g)disclosure required for the purposes of any arbitral or judicial proceedings
arising out of this Agreement;

(h)disclosure required pursuant to the terms of this Agreement; or

(i)any announcement made in accordance with Section 5.

 

4.3Each of the Parties shall inform any Representatives to whom it provides
Confidential Information that such information is confidential and shall
instruct each such Representative:

(a)to keep it confidential;

(b)not to use it for its own business purposes; and

(c)not to disclose it to any third party (other than those persons to whom it
has already been disclosed in accordance with this Agreement).

 

4.4The disclosing party shall be responsible for any breach of this Section 4.4
by a Representative to whom it provides any Confidential Information as if the
disclosing party were the party that had breached this Section 4.4.

 

5.Announcements

 

5.1Subject to Section 5.2, unless otherwise agreed in writing, no Party (nor any
of its Connected Persons) shall make any announcement or issue any communication
in connection with the existence or subject matter of this Agreement.

 

5.2The restriction in Section 5.1 shall not apply to the extent that the
announcement or communication is required by Law, by any stock exchange or by
any Governmental Authority. In this case, the Party making the announcement or
issuing the communication shall, as far as reasonably practicable:

(a)use reasonable endeavors to consult with the other Parties in advance as to
what form it takes, what it contains and when it is issued;

 

5

 

(b)take into account the relevant Party’s reasonable requirements; and

(c)announce and/or disclose (as applicable) only the minimum amount of
Confidential Information that is required to be announced and/or disclosed (as
applicable) and use reasonable endeavors to assist the relevant Party in respect
of any reasonable action that they may take to resist or limit such announcement
and/or the issuance of such circular (as applicable).

 

6.Notices

 

6.1All notices, demands, requests, consents, approvals or other communications
required or permitted to be given hereunder or which are given with respect to
this Agreement shall be in writing and shall be personally served, delivered by
reputable air courier service with charges prepaid, or transmitted by hand
delivery, telegram, telex or facsimile, addressed as set forth below, or to such
other address as such Party shall have specified most recently by written
notice. Notice shall be deemed given on the date of service or transmission if
personally served or transmitted by telegram, telex or facsimile; provided, that
if such service or transmission is not on a Business Day or is after normal
business hours, then such notice shall be deemed given on the next Business Day.
Notice otherwise sent as provided herein shall be deemed given on the next
Business Day following timely delivery of such notice to a reputable air courier
service with an order for next-day delivery.

 

6.2The addresses and e-mail addresses of the Parties for the purpose of Section
6.1 are:

 

 

Company

For the attention of:

Sherif Foda

Address: 777 Post Oak

Blvd Suite 730

Houston, Texas 77056

United States

E-mail: sfoda@nesrco.com

          NESR Holdings
For the attention of:
Sherif Foda

Address: 777 Post Oak

Blvd., Suite 730

Houston, Texas 77056

United States

E-mail: sfoda@nesrco.com

         

Olayan

For the attention of:
Fadi Otaqui

Address: Hana

Investments Co. WLL

P.O. Box 8772

Riyadh, 11492,

Saudi Arabia

E-mail: F.Otaqui@olayangroup.com

 

7.Costs and Interest

 

7.1Each of the Parties shall be responsible for its own costs, charges and
expenses (including taxation) incurred in connection with negotiating, preparing
and implementing this Agreement and the transactions contemplated by it.

 

7.2The Company shall reimburse additional expenses of Olayan in the amount equal
to $2,400,000, either by wire transfer of immediately available funds or through
the issuance to Olayan or its designated Affiliate of an equivalent amount in
Common Shares valued at $11.244 per share, in the sole discretion of the
Company.

 

6

 

 

8.Whole Agreement

 

8.1This Agreement sets out the whole agreement between the Parties in respect of
the subject matter of this Agreement and supersedes any previous draft,
agreement, arrangement or understanding between them, whether in writing or not,
relating to it. In particular it is agreed that:

(a)no Party has relied on or shall have any claim or remedy arising under or in
connection with any statement, representation, warranty or undertaking, made by
or on behalf of any other Party (or any of its Connected Persons) in relation to
the subject matter of this Agreement that is not expressly set out in this
Agreement;

(b)any terms or conditions implied by Law in any jurisdiction in relation to the
subject matter of this Agreement are excluded to the fullest extent permitted by
Law or, if incapable of exclusion, any rights or remedies in relation to them
are irrevocably waived;

(c)the only right or remedy of a Party in relation to any provision of this
Agreement shall be for breach of this Agreement; and

(d)except for any liability in respect of a breach of this Agreement, no Party
(nor any of its Connected Persons) shall owe any duty of care or have any
liability in tort or otherwise to any other Party (or its respective Connected
Persons) in relation to the subject matter of this Agreement.

 

8.2Nothing in Section 8.1 shall limit any liability for (or remedy in respect
of) fraud or fraudulent misrepresentation.

 

8.3Each Party agrees to the terms of this Section 8 on its own behalf and as
agent for each of its Connected Persons.

 

9.Assignment

 

None of the Parties may assign, transfer, charge or otherwise deal with any of
its rights or obligations under this Agreement nor grant, declare, create or
dispose of any right or interest in it, in whole or in part; provided, however,
that Olayan may assign its rights and obligations under this Agreement to its
Affiliates. Any purported assignment in contravention of this Section 9 shall be
void.

 

10.Variations

 

10.1No variation of this Agreement shall be valid unless it is in writing and
duly executed by or on behalf of the Parties.

 

10.2If this Agreement is varied:

(a)the variation shall not constitute a general waiver of any provisions of this
Agreement;

(b)the variation shall not affect any rights, obligations or liabilities under
this Agreement that have already accrued up to the date of variation; and

 

7

 

 

(c)the rights and obligations of the Parties under this Agreement shall remain
in full force and effect, except as, and only to the extent that, they are so
varied.

 

11.Invalid Terms

 

11.1Each of the provisions of this Agreement is severable.

 

11.2If and to the extent that any provision of this Agreement:

(a)is held to be, or becomes, invalid or unenforceable under the Law of any
jurisdiction; but

(b)would be valid, binding and enforceable if some part of the provision were
deleted or amended,

 

then the provision shall apply with the minimum modifications necessary to make
it valid, binding and enforceable. All other provisions of this Agreement shall
remain in force.

 

11.3The Parties shall negotiate in good faith to amend or replace any invalid,
void or unenforceable provision with a valid, binding and enforceable substitute
provision or provisions, so that, after the amendment or replacement, the
commercial effect of the Agreement is as close as possible to the effect it
would have had if the relevant provision had not been invalid, void or
unenforceable.

 

12.termination

 

This Agreement is conditional upon the occurrence of the NESR Closing according
to the terms set forth in the SPA, without which occurrence this Agreement is
null and void. Otherwise, this Agreement may be terminated only by a mutual
written agreement signed by each of the Parties. Except for the provisions
specifically provided for in this Agreement that shall survive termination, this
Agreement shall forthwith become void and there shall be no further liability on
the part of any Party for such termination.

 

13.Enforceability, Rights and Remedies

 

13.1Any waiver of, or election whether or not to enforce, any right or remedy
provided under or pursuant to this Agreement or by Law must be in writing, and
no waiver or election shall be inferred from a Party’s conduct. Any such waiver
shall not be, or be deemed to be, a waiver of any subsequent breach or default.

 

13.2Except as expressly provided in this Agreement, no failure or delay by any
Party in exercising any right or remedy relating to this Agreement or by Law
shall impair such right or remedy or operate or be construed as a waiver or
variation of it or be treated as an election not to exercise such right or
remedy or preclude its exercise at any subsequent time. No single or partial
exercise of any such right or remedy shall preclude any other or further
exercise of it or the exercise of any other right or remedy.

 

13.3A Party that waives a right or remedy provided under this Agreement or by
Law in relation to one Party, or takes or fails to take any action against that
Party, does not affect its rights in relation to any other Party.

 

8

 

 

13.4The rights and remedies of each of the Parties under or pursuant to this
Agreement are cumulative, may be exercised as often as such Party considers
appropriate and are in addition to its rights and remedies under Law.

 

14.Counterparts

 

This Agreement may be executed in any number of counterparts, and by each Party
on separate counterparts. Each counterpart is an original, but all counterparts
shall together constitute one and the same instrument. Delivery of a counterpart
of this Agreement by e-mail attachment shall be an effective mode of delivery.

 

15.Governing Law

 

This Agreement shall be governed by, interpreted under, and construed in
accordance with the internal laws of the State of New York applicable to
agreements made and to be performed within the State of New York, without giving
effect to any choice-of- law provisions thereof that would compel the
application of the substantive laws of any other jurisdiction.

 

16.Jurisdiction; WAIVER OF TRIAL BY JURY

 

16.1In the event of any dispute or failure to perform by any Party, the Parties
agree to submit any dispute to the federal courts of the State of New York for
resolution, and each Party hereby agrees to and submits to any court with proper
jurisdiction in the State of New York. Because damages may not be an adequate
remedy for failure to perform, the Parties agree that they may seek injunctive
relief for enforcement of the provision or this Agreement in the federal courts
of the State of New York or any court of competent jurisdiction. The Parties
agree that no bond shall be required by the Party seeking injunctive relief.

 

16.2Each Party hereby irrevocably and unconditionally waives the right to a
trial by jury in any action, suit, counterclaim or other proceeding (whether
based on contract, tort or otherwise) arising out of, connected with or relating
to this Agreement, the transactions contemplated hereby, or the actions of the
Parties in the negotiation, administration, performance or enforcement hereof.

 

9

 

 

SCHEDULE 1
DEFINITIONS AND INTERPRETATION

 

1.Definitions. In this Agreement, the following words and expressions shall have
the following meaning:

 

“2018 AGM” has the meaning given to it in Section 2.3;

 

“Affiliate” with respect to any person, means any other person that directly, or
indirectly through one or more intermediaries, controls or is controlled by or
is under common control with, such person;

 

“Articles” means the Company articles of association, as amended from time to
time; “Board” means the board of directors of the Company;

“Board Meeting” means a meeting of the Board duly convened in accordance with
the Articles;

 

“Business Day” means any day of the year except Friday, Saturday and Sunday on
which national banking institutions in the UAE and New York, United States of
America are open to the public for conducting general commercial business and
are not required or authorized to close;

 

“Common Shares” means the ordinary shares with no par value of the Company;

 

“Company Group” means the Company and all entities controlled by the Company
from time to time;

 

“Confidential Information” has the meaning given to it in Section 4.1;

 

“Connected Persons” means, in relation to a Party, any Affiliate of that Party
and any officer, employee, agent, adviser or representative of that Party or any
of its Affiliates, in each case, from time to time;

 

“control” means, the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of a person, whether
through the ownership of voting securities, by contract, or otherwise, and
“controlled,” and “controlling” shall be construed accordingly;

 

“Directors” means the directors of the Company from time to time;

 

“Governmental Authority” means any government or governmental or regulatory body
thereof, or political subdivision thereof, whether federal, state, local or
foreign, or any agency, instrumentality or authority thereof, or any court or
arbitrator (public or private);

 

“Law” means any applicable statute, law, rule, regulation, guideline, ordinance,
code, policy or rule of common law issued, administered or enforced by any
Governmental Authority, or any judicial or administrative interpretation thereof
including the rules of any stock exchange;

 

10

 

 

“Lock-Up Period” has the meaning given to it in Section 3.1;

 

“Lock-Up Shares” has the meaning given to such term in the SPEA;

 

“Necessary Action” means with respect to a specified result, all actions (to the
extent such actions are permitted by Law and, in the case of any action by the
Company that requires a vote or other action on the part of the Board, to the
extent such action is consistent with the fiduciary duties that the Directors
may have in such capacity) necessary to cause such result, including (i) voting
or providing a written consent or proxy with respect to Common Shares, (ii)
causing the adoption of shareholders’ resolutions and amendments to the Articles
of the Company, (iii) executing agreements and instruments, and (iv) making or
causing to be made, with governmental, administrative or regulatory authorities,
all filings, registrations or similar actions that are required to achieve such
result;

 

“NESR Closing” has the meaning given to such term in the SPA; “NESR Closing
Date” has the meaning given to such term in the SPA;

 

“NESR Holdings” has the meaning given to it in the Preamble of this Agreement;
“NPS” has the meaning given to it in the Recitals of this Agreement;

 

“NPS Shares” has the meaning given to it in the Recitals of this Agreement;
“Olayan” has the meaning given to it in the Preamble of this Agreement; “Olayan
EVP” has the meaning given to it in Section 2.2 of this Agreement;

 

“Olayan Nominee” has the meaning given to it in Section 2.1;

 

“Parties” means the parties to this Agreement from time to time (including any
person who at the relevant time is a party to, or has agreed to be bound by,
this Agreement);

 

“Person” or “person” means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof;

 

“Proxy Statement” means the submission by the Company to the U.S. Securities and
Exchange Commission to request approval by the shareholders of the Company to
approve the transaction contemplated by the SPA;

 

“Representative” has the meaning given to it in Section 4.2(b);

 

“Shareholder Instrument” means:

 

(a)any Common Shares;

 

(b)any shares in the capital of any of the subsidiaries of the Company;

 

11

 

 

(c)any instrument, document or security granting a right of subscription for, or
conversion into Common Shares or shares in the capital of any of the
subsidiaries of the Company; and

 

(d)loan stock or any other instrument or security evidencing indebtedness issued
by any member of the Company Group (excluding any third-party debt financings);

 

“Shares” has the meaning given to it in the SPEA;

 

“SPA” has the meaning given to it in the Recitals of this Agreement; and

 

“SPEA” has the meaning given to it in the Recitals of this Agreement.

 

2.Interpretation. In this Agreement, unless the context otherwise requires:

(a)headings do not affect the interpretation of this Agreement; the singular
shall include the plural and vice versa; and references to one gender include
all genders;

(b)references to $ are references to the lawful currency from time to time of
the United States;

(c)any phrase introduced by the terms including, include, in particular or any
similar expression shall be construed as illustrative and shall not limit the
sense of the words preceding those terms;

(d)“herein”, “hereof” and other words of similar import refer to this Agreement
as a whole and not to any particular Article, Section or other subdivision; and

(e)if there is any inconsistency between any definition set out in this Schedule
and a definition set out in any section or any other Schedule, then, for the
purposes of construing that section or Schedule, the definition set out in that
section or Schedule shall prevail.

 

3.Where any obligation in this Agreement is expressed to be undertaken or
assumed by any Party, that obligation is to be construed as requiring the Party
concerned to exercise all rights and powers of control over the affairs of any
other person which it is able to exercise (whether directly or indirectly) in
order to secure performance of the obligation.

 

12

 

 

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and
delivered by their duly authorized representatives as of the date first written
above.

 

  COMPANY:       NATIONAL ENERGY SERVICES REUNITED CORP.       By:   Name:  
Title:       NESR HOLDINGS:       NESR HOLDINGS LIMITED       By:   Name:  
Title:       OLAYAN:       HANA INVESTMENTS CO. WLL LTD.       By:   Name:  
Title:

 

[Signature Page to the Relationship Agreement]

 

 

 

 

Exhibit B

Registration Rights Agreement

 

 

 

 

EXECUTION VERSION

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS AGREEMENT is entered into on June 5, 2018 by and
between National Energy Services Reunited Corp., a British Virgin Islands
company (the “Company”), and Hana Investments Co. WLL, formed under the laws of
Bahrain (“Olayan”) (each of Olayan and the Company to be referenced hereinafter
as a “Party” or collectively as “Parties”).

 

WHEREAS, the Company, Olayan, NPS Holdings Limited (“NPS”) and OFS Investments
Limited, Arab Petroleum Investments Corporation, Castle SPC Limited, Al Nowais
Investments LLC, Abdulaziz Aldelaimi and Fahad Abdulla Bindekhayel entered into
that certain Stock Purchase Agreement, dated as of November 12, 2017 (the
“SPA”), pursuant to which Olayan agreed to acquire 83,660,878 shares, $1.00 par
value per share, of NPS (the “NPS Shares”);

 

WHEREAS, pursuant to the SPA, the Company has agreed to Olayan and its
subsidiaries and affiliates certain registration and other rights in the United
States with respect to the Registrable Securities; and

 

WHEREAS, on the date hereof, the Company and Olayan entered into that certain
Shares Purchase Exchange Agreement (“SPEA”) pursuant to which, on the NESR
Closing Date, Olayan agreed to contribute the legal and beneficial ownership of
the NPS Shares to the Company in exchange for the issuance by the Company of the
Shares (as defined in the SPEA) on the terms and subject to the conditions set
out in the SPEA.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

ARTICLE 1

DEFINITIONS

 

1.1       Definitions. The following capitalized terms used herein have the
following meanings. Any defined terms used in this Registration Rights Agreement
and not defined herein shall have the same meaning as in the SPA:

 

“Approved Context” is defined in Section 2.8.

 

“Commission” means the Securities and Exchange Commission, or any other Federal
agency then administering the Securities Act or the Exchange Act.

 

“Company” is defined in the preamble of this Registration Rights Agreement.

 

“Demand Registration” is defined in Section 2.1.1.

 

“Demanding Holder” is defined in Section 2.1.1.

 

 

 

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission promulgated thereunder, all as the same
shall be in effect at the time.

 

“Filing Date” is defined in Section 2.4.1.

 

“Form S-3” is defined in Section 2.3.

 

“Holder Information” is defined in Section 2.8.

 

“Indemnified Party” is defined in Section 3.3.

 

“Indemnifying Party” is defined in Section 3.3.

 

“Initiating Holder” is defined in Section 2.1.1.

 

“Investor Indemnified Party” is defined in Section 3.1.

 

“Maximum Number of Shares” is defined in Section 2.1.4.

 

“NESR Closing Date” is defined in the SPA.

 

“NPS Shares” is defined in the Recitals of this Registration Rights Agreement.

 

“Olayan” is defined in the preamble of this Registration Rights Agreement.

 

“Ordinary Share” means the ordinary share of the Company, no par value.

 

“Partner Distribution” is defined in Section 2.4.4.

 

“Party” or “Parties” is defined in the preamble of this Registration Rights
Agreement.

 

“Person” or “person” means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof.

 

“Piggy-Back Registration” is defined in Section 2.2.1

 

“Pro Rata” is defined in Section 2.1.4.

 

“register,” “registered” and “registration” mean a registration effected by
preparing and filing a registration statement or similar document in compliance
with the requirements of the Securities Act, and such registration statement
becoming effective.

 

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“Registrable Securities” means (i) the Shares and (ii) any other ordinary
shares, of no par value, of the Company held by Olayan or any of its
subsidiaries or affiliates at any time (including those held as a result of, or
issuable upon, the conversion or exercise of options, warrants and other
securities convertible into, or exchangeable or exercisable for (at any time or
upon the occurrence of any event or contingency and without regard to any
vesting or other conditions to which such securities may be subject), or
depositary receipts or depositary shares representing or evidencing, Ordinary
Shares (including, without limitation, any note or debt security convertible
into or exchangeable for Ordinary Shares), whether now owned or acquired by
Olayan at a later time. Registrable Securities include any warrants, shares of
capital or other securities of the Company (or any successor thereto) issued as
a dividend or other distribution with respect to or in exchange for or in
replacement of any of the securities referenced in the prior sentence. As to any
particular Registrable Securities, such securities shall cease to be Registrable
Securities when: (a) a Registration Statement with respect to the sale of such
securities shall have become effective under the Securities Act and such
securities shall have been sold, transferred, disposed of or exchanged in
accordance with such Registration Statement; (b) such securities shall have been
otherwise transferred, new certificates for them not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent public distribution of them shall not require registration under the
Securities Act; (c) such securities shall have ceased to be outstanding or (d)
the Registrable Securities are freely saleable under Rule 144 without volume
limitations or any other limitation or restriction imposed by Rule 144 under the
Securities Act.

 

“Registration Rights Agreement” means this agreement, as amended, restated,
supplemented or otherwise modified from time to time.

 

“Registration Statement” means a registration statement filed by the Company
with the Commission in compliance with the Securities Act for a public offering
and sale of equity securities, or securities or other obligations exercisable or
exchangeable for, or convertible into, equity securities (other than a
registration statement on Form S-4, Form F-4 or Form S-8, or their successors,
or any registration statement covering only securities proposed to be issued in
exchange for securities or assets of another entity).

 

“Resale Shelf Period” is defined in Section 2.4.2.

 

“Resale Shelf Registration Statement” is defined in Section 2.4.1.

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder, all as the same shall be
in effect at the time.

 

“Shelf Offering” is defined in Section 2.3.

 

“Shelf Registration Statement” means a Registration Statement of the Company
filed with the Commission on either (a) Form S-3 or Form F-3 (or any successor
form or other appropriate form under the Securities Act) or (b) if the Company
is not permitted to file a Registration Statement on Form S-3 or Form F-3, an
evergreen Registration Statement on Form S-1 or Form F-1 (or any successor form
or other appropriate form under the Securities Act), in each case for an
offering to be made on a continuous basis pursuant to Rule 415 under the
Securities Act (or any similar rule that may be adopted by the Commission)
covering the Registrable Securities, as applicable.

 

“SPA” is defined in the Recitals of this Registration Rights Agreement.

 

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“SPEA” is defined in the Recitals of this Registration Rights Agreement.

 

“Underwriter” means a securities dealer who purchases any Registrable Securities
as principal in an underwritten offering and not as part of such dealer’s
market-making activities.

 

ARTICLE 2

REGISTRATION RIGHTS

 

2.1Demand Registration.

 

2.1.1        Request for Registration.

 

(a)               At any time and from time to time on or after the NESR Closing
Date, Olayan may make a written demand (such holder, the “Initiating Holder”)
for registration under the Securities Act of all or part of its Registrable
Securities (a “Demand Registration”). Any demand for a Demand Registration shall
specify the number of Registrable Securities proposed to be registered and the
intended method(s) of distribution thereof. The Company will notify all holders
of Registrable Securities of the demand, and each holder of Registrable
Securities who wishes to include all or a portion of such holder’s Registrable
Securities in the Demand Registration (each such holder including shares of
Registrable Securities in such registration, including, without limitation, the
Initiating Holder(s), a “Demanding Holder”) shall so notify the Company within
fifteen (15) days after the receipt by the holder of the notice from the
Company. Upon any such request, the Demanding Holders shall be entitled to have
their Registrable Securities included in the Demand Registration, subject to
Section 2.1.4 and the provisos set forth in Section 2.5.1(a). Olayan shall be
entitled to cause the Company to effect up to two (2) Demand Registrations under
this Section 2.1.1.

 

(b)               the Company shall file the registration statement in respect
of a Demand Registration as soon as practicable and, in any event, within sixty
(60) days after receiving a request for a Demand Registration and shall use
reasonable best efforts to cause the same to be declared effective by the SEC as
promptly as practicable after such filing; provided, however, that:

 

(i)                 the Company shall not be obligated to effect a Demand
Registration pursuant to Section 2.1.1(a) within sixty (60) days after the
effective date of a previous Demand Registration, other than a Shelf
Registration Statement or Resale Shelf Registration Statement; and

 

(ii)               the Company shall not be obligated to effect a Demand
Registration pursuant to Section 2.1.1(a) unless such demand request is for a
number of Registrable Securities with a market value that is equal to at least
$25,000,000 as of the date of such request.

 

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2.1.2        Effective Registration. A registration will not count as a Demand
Registration until the Registration Statement filed with the Commission with
respect to such Demand Registration has been declared effective and the Company
has complied with all of its obligations under this Registration Rights
Agreement with respect thereto; provided, however, that if, after such
Registration Statement has been declared effective, the offering of Registrable
Securities pursuant to a Demand Registration is interfered with by any stop
order or injunction of the Commission or any other governmental agency or court,
the Registration Statement with respect to such Demand Registration will be
deemed not to have been declared effective, unless and until, (i) such stop
order or injunction is removed, rescinded or otherwise terminated, and (ii) a
majority-in-interest of the Demanding Holders thereafter elect to continue the
offering; provided further that the Company shall not be obligated to file a
second Registration Statement until a Registration Statement that has been filed
is counted as a Demand Registration or is terminated.

 

2.1.3        Underwritten Offering. If the Initiating Holder so elects and such
holder so advises the Company as part of its written demand for a Demand
Registration, the offering of such Registrable Securities pursuant to such
Demand Registration shall be in the form of an underwritten offering. In such
event, the right of any holder to include its Registrable Securities in such
registration shall be conditioned upon such holder’s participation in such
underwriting and the inclusion of such holder’s Registrable Securities in the
underwriting to the extent provided herein. All Demanding Holders proposing to
distribute their Registrable Securities through such underwriting shall enter
into an underwriting agreement in customary form with the Underwriter or
Underwriters selected for such underwriting by the Initiating Holder.

 

2.1.4        Reduction of Offering. If the managing Underwriter or Underwriters
for a Demand Registration that is to be an underwritten offering advises the
Company and the Demanding Holders in writing that the dollar amount or number of
shares of Registrable Securities which the Demanding Holders desire to sell,
taken together with all other Ordinary Shares or other securities which the
Company desires to sell and the Ordinary Shares, if any, as to which
registration has been requested pursuant to written contractual piggy-back
registration rights held by other shareholders of the Company who desire to
sell, exceeds the maximum dollar amount or maximum number of shares that can be
sold in such offering without adversely affecting the proposed offering price,
the timing, the distribution method or the probability of success of such
offering (such maximum dollar amount or maximum number of shares, as applicable,
the “Maximum Number of Shares”), then the Company shall include in such
registration: (i) first, the Registrable Securities as to which Demand
Registration has been requested by the Demanding Holders (pro rata in accordance
with the number of shares that each such Person has requested be included in
such registration, regardless of the number of shares held by each such Person
(such proportion is referred to herein as “Pro Rata”)) that can be sold without
exceeding the Maximum Number of Shares; (ii) second, to the extent that the
Maximum Number of Shares has not been reached under the foregoing clause (i),
the Ordinary Shares or other securities that the Company desires to sell that
can be sold without exceeding the Maximum Number of Shares; and (iii) third, to
the extent that the Maximum Number of Shares has not been reached under the
foregoing clauses (i) and (ii), the Ordinary Shares or other securities for the
account of other persons that the Company is obligated to register pursuant to
written contractual arrangements with such persons and that can be sold without
exceeding the Maximum Number of Shares.

 

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Notwithstanding the foregoing, no employee of the Company or any subsidiary
thereof will be entitled to participate, directly or indirectly, in any such
registration to the extent that the managing Underwriter or Underwriters (or, in
the case of any offering that is not underwritten, a nationally recognized
investment banking firm) determines in good faith that the participation of such
employee in such registration would adversely affect the marketability or
offering price of the securities being sold in such registration.

 

2.1.5        Withdrawal. If any Demanding Holder disapproves of the terms of any
underwriting or is not entitled to include all of its Registrable Securities in
any offering, such Demanding Holder may elect to withdraw from such offering by
giving written notice to the Company and the Underwriter or Underwriters of its
request to withdraw prior to the effectiveness of the Registration Statement
filed with the Commission with respect to such Demand Registration or, if later,
prior to the pricing date of the applicable offering. If the Initiating Holder
withdraws from a proposed offering relating to a Demand Registration, then such
registration shall not count as a Demand Registration provided for in Section
2.1 by such Initiating Holder; provided that, if the registration is completed,
then the demand request will be considered to have been made by the Demanding
Holder that sells the greatest number of Registrable Securities in the offering
or, if such Demanding Holder is not entitled to any demands, to the Demanding
Holder that sells the next greatest number of shares.

 

2.2Piggy-Back Registration.

 

2.2.1        Piggy-Back Rights. If at any time on or after the NESR Closing Date
the Company proposes to file a Registration Statement under the Securities Act
with respect to an offering of equity securities, or securities or other
obligations exercisable or exchangeable for, or convertible into, equity
securities, by the Company for its own account or for shareholders of the
Company for their account (or by the Company and by shareholders of the Company
including, without limitation, pursuant to Section 2.1), other than a
Registration Statement (i) filed in connection with any employee stock option or
other benefit plan, (ii) for an exchange offer or offering of securities solely
to the Company’s existing shareholders, (iii) for an offering of debt that is
convertible into equity securities of the Company or (iv) for a dividend
reinvestment plan, then the Company shall (x) give written notice of such
proposed filing to the holders of Registrable Securities as soon as practicable
but in no event less than ten (10) days before the anticipated filing date,
which notice shall describe the amount and type of securities to be included in
such offering, the intended method(s) of distribution, and the name of the
proposed managing Underwriter or Underwriters, if any, of the offering, and (y)
offer to the holders of Registrable Securities in such notice the opportunity to
register the sale of such number of shares of Registrable Securities as such
holders may request in writing within five (5) days following receipt of such
notice (a “Piggy-Back Registration”). The Company shall cause such Registrable
Securities to be included in such registration and shall use its best efforts to
cause the managing Underwriter or Underwriters of a proposed underwritten
offering to permit the Registrable Securities requested to be included in a
Piggy-Back Registration on the same terms and conditions as any similar
securities of the Company and to permit the sale or other disposition of such
Registrable Securities in accordance with the intended method(s) of distribution
thereof. All holders of Registrable Securities proposing to distribute their
securities through a Piggy-Back Registration that involves an Underwriter or
Underwriters shall enter into an underwriting agreement in customary form with
the Underwriter or Underwriters selected for such Piggy-Back Registration.

 

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2.2.2        Reduction of Offering. If the managing Underwriter or Underwriters
for a Piggy- Back Registration that is to be an underwritten offering advises
the Company and the holders of Registrable Securities in writing that the dollar
amount or number of Ordinary Shares which the Company desires to sell, taken
together with the Registrable Securities as to which registration has been
requested under this Section 2.2 and the Ordinary Shares, if any, as to which
registration has been requested pursuant to the written contractual piggy-back
registration rights of other shareholders of the Company, exceeds the Maximum
Number of Shares, then the Company shall include in any such registration:

 

(a)               if the registration is undertaken for the Company’s account:
(A) first, the Ordinary Shares or other securities that the Company desires to
sell that can be sold without exceeding the Maximum Number of Shares; (B)
second, to the extent that the Maximum Number of Shares has not been reached
under the foregoing clause (A), the Ordinary Shares or other securities, if any,
comprised of Registrable Securities, as to which registration has been requested
pursuant to the applicable written contractual piggy-back registration rights of
such security holders, Pro Rata, that can be sold without exceeding the Maximum
Number of Shares; and (C) third, to the extent that the Maximum Number of Shares
has not been reached under the foregoing clauses (A) and (B), the Ordinary
Shares or other securities for the account of other persons that the Company is
obligated to register pursuant to written contractual piggy-back registration
rights with such persons and that can be sold without exceeding the Maximum
Number of Shares; and

 

(b)               if the registration is a “demand” registration undertaken at
the demand of persons other than the holders of Registrable Securities, (A)
first, the Ordinary Shares or other securities for the account of the demanding
persons that can be sold without exceeding the Maximum Number of Shares; (B)
second, to the extent that the Maximum Number of Shares has not been reached
under the foregoing clause (A), the Ordinary Shares or other securities that the
Company desires to sell that can be sold without exceeding the Maximum Number of
Shares; (C) third, to the extent that the Maximum Number of Shares has not been
reached under the foregoing clauses (A) and (B), collectively the Ordinary
Shares or other securities comprised of Registrable Securities, Pro Rata, as to
which registration has been requested pursuant to the terms hereof, that can be
sold without exceeding the Maximum Number of Shares; and (D) fourth, to the
extent that the Maximum Number of Shares has not been reached under the
foregoing clauses (A), (B) and (C), the Ordinary Shares or other securities for
the account of other persons that the Company is obligated to register pursuant
to written contractual arrangements with such persons, that can be sold without
exceeding the Maximum Number of Shares.

 

21

 

 

2.2.3        Withdrawal. Any holder of Registrable Securities may elect to
withdraw such holder’s request for inclusion of Registrable Securities in any
Piggy-Back Registration by giving written notice to the Company of such request
to withdraw prior to the effectiveness of the Registration Statement or, if
later, prior to the pricing date of the applicable offering. The Company
(whether on its own determination or as the result of a withdrawal by persons
making a demand pursuant to written contractual obligations) may withdraw a
Registration Statement at any time prior to the effectiveness of such
Registration Statement. Notwithstanding any such withdrawal, the Company shall
pay all expenses incurred by the holders of Registrable Securities in connection
with such Piggy-Back Registration as provided in Section 2.7.

 

2.3              Registrations on Form S-3. The holders of Registrable
Securities may, at any time and from time to time, request in writing that the
Company register the resale of any or all of such Registrable Securities on Form
S-3 or Form F-3 (as applicable) or any similar short-form registration to the
extent available at such time, including, without limitation, an automatic shelf
registration available to well-known seasoned issuers (“Form S-3”). Upon receipt
of such written request, the Company will promptly give written notice of the
proposed registration to all other holders of Registrable Securities, and, as
soon as practicable thereafter, effect the registration of all or such portion
of such holder’s or holders’ Registrable Securities as are specified in such
request, together with all or such portion of the Registrable Securities or
other securities of the Company, if any, of any other holder or holders joining
in such request as are specified in a written request given within fifteen (15)
days after receipt of such written notice from the Company. At any time that a
Form S-3 is effective, if Olayan delivers a notice to the Company stating that
it intends to effect an underwritten offering or distribution of all or part of
its Registrable Securities included by it on any Form S-3 (a “Shelf Offering”),
then the Company shall amend or supplement the Form S-3 as may be necessary in
order to enable such Registrable Securities to be distributed pursuant to the
Shelf Offering. If the managing Underwriter or Underwriters for a Shelf Offering
that is to be an underwritten offering advises the Company and the selling
holders of Registrable Securities in writing that the dollar amount or number of
shares of Registrable Securities which the selling holders desire to sell, taken
together with all other Ordinary Shares or other securities which the Company
desires to sell and the Ordinary Shares, if any, as to which registration has
been requested pursuant to written contractual piggy-back registration rights
held by other shareholders of the Company who desire to sell, exceeds the
Maximum Number of Shares, then the Company shall include shares in such
registration in the manner provided for in Section 2.1.4. The Company shall not
be obligated to effect any Shelf Offering or registration pursuant to this
Section 2.3: (i) if Form S-3 is not available for such offering; or (ii) if the
holders of the Registrable Securities, together with the holders of any other
securities of the Company entitled to inclusion in such registration, propose to
sell Registrable Securities and such other securities (if any) at any aggregate
price to the public of less than $500,000. Registrations effected pursuant to
this Section 2.3 shall not be counted as Demand Registrations effected pursuant
to Section 2.1.

 

2.4Resale Shelf Registration.

 

2.4.1        Filing. As promptly as practicable following the NESR Closing Date,
but in any event within four (4) months following the NESR Closing Date (the
“Filing Date”), the Company shall file with the Commission a Shelf Registration
Statement relating to the offer and sale of all Registrable Securities owned by
Olayan (the “Resale Shelf Registration Statement”). If any Resale Shelf
Registration Statement is filed before the time that is thirty (30) days after
the NESR Closing Date, then Company shall cause to be registered the Registrable
Securities in such Resale Shelf Registration Statement.

 

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2.4.2        Continued Effectiveness. The Company shall use its commercially
reasonable efforts to have the Resale Shelf Registration Statement declared
effective as soon as practicable after the filing thereof, but in no event later
than thirty (30) days after the Filing Date (or one hundred twenty (120) days
after the Filing Date if the Commission notifies the Company that it will
“review” the Resale Shelf Registration Statement). The Company shall use its
commercially reasonable efforts to maintain the effectiveness of the Resale
Shelf Registration Statement or any Subsequent Shelf Registration (as defined
below) until such time as all Registrable Securities have been sold pursuant to
the Resale Shelf Registration Statement or a Subsequent Shelf Registration (but
in no event for a shorter period than the applicable period referred to in
Section 4(a)(3) of the Securities Act and Rule 174 thereunder) (such required
period(s) of effectiveness, collectively, the “Resale Shelf Period”). Subject to
Section 2.6, the Company shall not be deemed to have used commercially
reasonable efforts to keep the Resale Shelf Registration Statement effective
during the Resale Shelf Period if the Company voluntarily takes any action or
omits to take any action that would result in the holders of Registrable
Securities covered thereby not being able to offer and sell any Registrable
Securities pursuant to such Resale Shelf Registration Statement during the
Resale Shelf Period, unless such action or omission is required by applicable
law. The filing of the Resale Registration Statement and offers and sales
thereunder shall not be deemed to be a Demand Registration pursuant to this
Registration Rights Agreement. The holders of Registrable Securities shall be
eligible to sell their Registrable Securities pursuant to such Resale
Registration Statement from time to time on one or more occasions, including,
without limitation, through one or more underwritten offerings.

 

2.4.3        Subsequent Shelf Registration. If any Shelf Registration Statement
ceases to be effective under the Securities Act for any reason at any time
during the Resale Shelf Period, the Company shall use its reasonable best
efforts as promptly as is reasonably practicable to cause such Shelf
Registration Statement to again become effective under the Securities Act
(including obtaining the prompt withdrawal of any order suspending the
effectiveness of such Shelf Registration Statement), and shall use its
reasonable best efforts as promptly as is reasonably practicable to amend such
Shelf Registration Statement in a manner reasonably expected to result in the
withdrawal of any order suspending the effectiveness of such Shelf Registration
Statement or file an additional registration statement (a “Subsequent Shelf
Registration”) for an offering to be made on a delayed or continuous basis
pursuant to Rule 415 of the Securities Act registering the resale from time to
time by the holders thereof of all securities that are Registrable Securities as
of the time of such filing. If a Subsequent Shelf Registration is filed, the
Company shall use its reasonable best efforts to (x) cause such Subsequent Shelf
Registration to become effective under the Securities Act as promptly as is
reasonably practicable after the filing thereof and (y) keep such Subsequent
Shelf Registration continuously effective and usable until the end of the Resale
Shelf Period. Any such Subsequent Shelf Registration shall be a registration
statement on Form S-3 or Form F-3 to the extent that the Company is eligible to
use such form. Otherwise, such Subsequent Shelf Registration shall be on another
appropriate form and shall provide for the registration of such Registrable
Securities for resale by the holders in accordance with any reasonable method of
distribution elected by Olayan or for sale by the Company, as the case may be.

 

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2.4.4        Partner Distribution. Notwithstanding anything contained herein to
the contrary, the Company hereby agrees that (i) the Resale Shelf Registration
Statement and any Subsequent Shelf Registration shall contain all language
(including, without limitation, on the prospectus cover page, the principal
shareholder chart and the plan of distribution) as may reasonably be requested
by Olayan to allow for a distribution of Registrable Securities to, and resale
by, the direct and indirect affiliates, partners, members, shareholders,
directors, employees or consultants of Olayan (a “Partner Distribution”) and
(ii) the Company shall, at the reasonable request of Olayan to effect a Partner
Distribution, file any prospectus supplement or post-effective amendments and
otherwise take any action reasonably requested to include such language, if such
language was not included in the initial Registration Statement, or revise such
language if deemed reasonably necessary by Olayan to effect such Partner
Distribution (including the ability for the distributees to resell such
Registrable Securities), including naming in a prospectus supplement or
post-effective amendment all of the affiliates, partners, members, shareholders,
directors, employees or consultants of Olayan who receive securities in the
Partner Distribution so that they may resell the securities received. Any
Ordinary Shares distributed pursuant to a Partner Distribution shall remain
“Registrable Securities” until they are sold or transferred by the recipients
thereof.

 

2.4.5        Block Trades. Notwithstanding anything stated in this Registration
Rights Agreement to the contrary, in the event that Olayan wishes to engage in
an underwritten block trade or overnight bought deal (or other similar
registered offering), Olayan shall not be required to give more than one (1)
day’s notice of the transaction to any other holder or the Company, but shall
endeavor to work with the Company, Olayan and the applicable underwriters
sufficiently in advance of the launch date of such transaction in order to
prepare the requisite documentation and prospectus supplement necessary in order
to implement such offering. For the avoidance of doubt, the Initiating Holder
with respect to such underwritten block trade or overnight bought deal (or other
similar registered offering) shall determine the launch date for such
transaction.

 

2.5Registration Procedures.

 

2.5.1        Filings; Information. Whenever the Company is required to effect
the registration of any Registrable Securities pursuant to this Article 2, the
Company shall use its best efforts to effect the registration and sale of such
Registrable Securities in accordance with the intended method(s) of distribution
thereof as expeditiously as practicable, and in connection with any such
request:

 

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(a)               Filing Registration Statement. The Company shall use its best
efforts to, as expeditiously as possible after receipt of a request for a Demand
Registration pursuant to Section 2.1 or a request pursuant to Section 2.3,
prepare and file with the Commission a Registration Statement on any form for
which the Company then qualifies or which counsel for the Company shall deem
appropriate and which form shall be available for the sale of all Registrable
Securities to be registered thereunder in accordance with the intended method(s)
of distribution thereof, and shall use its best efforts to cause such
Registration Statement to become effective and use its best efforts to keep it
effective for the period required by Section 2.5.1(c); provided, however, that
the Company shall have the right to defer any Demand Registration for up to
seventy-five (75) days, such that any obligations of Company pursuant to a
Demand Registration shall be extended by up to seventy-five (75) days, and any
Piggy-Back Registration for such period as may be applicable to deferment of any
demand registration to which such Piggy-Back Registration relates; provided
further, however, that the Company shall not have the right to exercise the
right set forth in the immediately preceding proviso more than once in any three
hundred and sixty-five (365)-day period in respect of a Demand Registration
hereunder.

 

(b)               Copies. The Company shall, prior to filing a Registration
Statement or prospectus, or any amendment or supplement thereto, furnish without
charge to the holders of Registrable Securities included in such registration,
and such holders’ legal counsel, copies of such Registration Statement as
proposed to be filed, each amendment and supplement to such Registration
Statement (in each case including all exhibits thereto and documents
incorporated by reference therein), the prospectus included in such Registration
Statement (including each preliminary prospectus), and such other documents as
the holders of Registrable Securities included in such registration or legal
counsel for any such holders may request in order to facilitate the disposition
of the Registrable Securities owned by such holders.

 

(c)               Amendments and Supplements. The Company shall prepare and file
with the Commission such amendments, including post-effective amendments, and
supplements to such Registration Statement and the prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective and
in compliance with the provisions of the Securities Act until all Registrable
Securities and other securities covered by such Registration Statement have been
disposed of in accordance with the intended method(s) of distribution set forth
in such Registration Statement or such securities have been withdrawn or until
such time as the Registrable Securities cease to be Registrable Securities.

 

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(d)               Notification. After the filing of a Registration Statement,
the Company shall promptly, and in no event more than two (2) business days
after such filing, notify the holders of Registrable Securities included in such
Registration Statement of such filing, and shall further notify such holders
promptly and confirm such advice in writing in all events within two (2)
business days of the occurrence of any of the following: (i) when such
Registration Statement becomes effective; (ii) when any post-effective amendment
to such Registration Statement becomes effective; (iii) the issuance or
threatened issuance by the Commission of any stop order (and the Company shall
take all actions required to prevent the entry of such stop order or to remove
it if entered); and (iv) any request by the Commission for any amendment or
supplement to such Registration Statement or any prospectus relating thereto or
for additional information or of the occurrence of an event requiring the
preparation of a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of the securities covered by such
Registration Statement, such prospectus will not contain an untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and promptly make
available to the holders of Registrable Securities included in such Registration
Statement any such supplement or amendment, and promptly deliver to holders of
Registrable Securities and their counsel any written comments received from the
Commission with respect to the Registration Statement, Prospectus or any
amendment or supplement thereto; except that before filing with the Commission a
Registration Statement or prospectus or any amendment or supplement thereto,
including documents incorporated by reference, the Company shall furnish to the
holders of Registrable Securities included in such Registration Statement and to
the legal counsel for any such holders, copies of all such documents proposed to
be filed sufficiently in advance of filing to provide such holders and legal
counsel with a reasonable opportunity to review such documents and comment
thereon, and the Company shall not file any Registration Statement or prospectus
or amendment or supplement thereto, including documents incorporated by
reference, to which such holders or their legal counsel shall object.

 

(e)               State Securities Laws Compliance. The Company shall use its
best efforts to (i) register or qualify the Registrable Securities covered by
the Registration Statement under such securities or “blue sky” laws of such
jurisdictions in the United States as the holders of Registrable Securities
included in such Registration Statement (in light of their intended plan of
distribution) may request and (ii) take such action necessary to cause such
Registrable Securities covered by the Registration Statement to be registered
with or approved by such other governmental authorities as may be necessary by
virtue of the business and operations of the Company and do any and all other
acts and things that may be necessary or advisable to enable the holders of
Registrable Securities included in such Registration Statement to consummate the
disposition of such Registrable Securities in such jurisdictions; provided,
however, that the Company shall not be required to qualify generally to do
business in any jurisdiction where it would not otherwise be required to qualify
but for this paragraph, or subject itself to taxation in any such jurisdiction.

 

(f)                Agreements for Disposition. The Company shall enter into
customary agreements (including, if applicable, an underwriting agreement in
customary form) and take such other actions as are reasonably required in order
to expedite or facilitate the disposition of such Registrable Securities,
including using commercially reasonable efforts to cause its counsel and
auditors to provide the Underwriters with legal opinions and comfort letters
reasonably requested by the Underwriters. The representations, warranties and
covenants of the Company in any underwriting agreement which are made to or for
the benefit of any Underwriters, to the extent applicable, shall also be made to
and for the benefit of the holders of Registrable Securities included in such
registration statement. No holder of Registrable Securities included in such
registration statement shall be required to make any representations or
warranties in the underwriting agreement except, if applicable, with respect to
such holder’s organization, good standing, authority, title to Registrable
Securities, lack of conflict of such sale with such holder’s material agreements
and organizational documents, and with respect to written information relating
to such holder that such holder has furnished in writing expressly for inclusion
in such Registration Statement.

 

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(g)               Cooperation. The principal executive officer of the Company,
the principal financial officer of the Company, the principal accounting officer
of the Company and all other officers and members of the management of the
Company shall cooperate fully in any offering of Registrable Securities
hereunder, which cooperation shall include, without limitation, the preparation
of the Registration Statement with respect to such offering and all other
offering materials and related documents, and participation in meetings with
Underwriters, attorneys, accountants and potential investors.

 

(h)               Records. The Company shall make available for inspection by
the holders of Registrable Securities included in such Registration Statement,
any Underwriter participating in any disposition pursuant to such registration
statement and any attorney, accountant or other professional retained by any
holder of Registrable Securities included in such Registration Statement or any
Underwriter, all financial and other records, pertinent corporate documents and
properties of the Company, as shall be necessary to enable them to exercise
their due diligence responsibility, and cause the Company’s officers, directors
and employees to supply all information requested by any of them in connection
with such Registration Statement.

 

(i)                 Opinions and Comfort Letters. The Company shall furnish to
each holder of Registrable Securities included in any Registration Statement a
signed counterpart, addressed to such holder, of (i) any opinion of counsel to
the Company delivered to any Underwriter and (ii) any comfort letter from the
Company’s independent public accountants delivered to any Underwriter. In the
event no legal opinion is delivered to any Underwriter, the Company shall
furnish to each holder of Registrable Securities included in such Registration
Statement, at any time that such holder elects to use a prospectus, an opinion
of counsel to the Company to the effect that the Registration Statement
containing such prospectus has been declared effective and that no stop order is
in effect.

 

(j)                 Earnings Statement. The Company shall comply with all
applicable rules and regulations of the Commission and the Securities Act, and
make available to its shareholders, as soon as practicable, an earnings
statement covering a period of twelve (12) months, which earnings statement
shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder.

 

27

 

 

(k)               Listing. The Company shall use its best efforts to cause all
Registrable Securities included in any registration to be listed on such
exchanges or otherwise designated for trading in the same manner as similar
securities issued by the Company are then listed or designated or, if no such
similar securities are then listed or designated, in a manner satisfactory to
the holders of a majority of the Registrable Securities included in such
registration.

 

(l)                 Road Show. If the registration involves the registration of
Registrable Securities involving gross proceeds in excess of $25,000,000, the
Company shall use its reasonable efforts to make available senior executives of
the Company to participate in customary “road show” presentations that may be
reasonably requested by the Underwriter in any underwritten offering.

 

(m)             Removal of Restrictive Legends. The Company shall cooperate with
the selling holders of Registrable Securities and the managing Underwriter or
Underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold and not bearing any
restrictive legends.

 

2.6              Obligation to Suspend Distribution. Upon receipt of any notice
from the Company of the happening of any event of the kind described in Section
2.5.1(d)(iv), each holder of Registrable Securities included in any registration
shall immediately discontinue disposition of such Registrable Securities
pursuant to the Registration Statement covering such Registrable Securities
until such holder receives the supplemented or amended prospectus contemplated
by Section 2.5.1(d). In addition, in the case of a resale registration pursuant
to Section 2.3 or Section 2.4 hereof, in the event that a holder of Registrable
Securities is an insider subject to the Company’s insider trading compliance
program, upon any suspension by the Company pursuant to a written insider
trading compliance program adopted by the Company’s Board of Directors of the
ability of all “insiders” covered by such program to transact in the Company’s
securities because of the existence of material non-public information, then
each such insider shall immediately discontinue disposition of such Registrable
Securities pursuant to the Registration Statement covering such Registrable
Securities until the restriction on the ability of “insiders” to transact in the
Company’s securities is removed. In either case, if so directed by the Company,
each such holder will deliver to the Company all copies, other than permanent
file copies then in such holder’s possession, of the most recent prospectus
covering such Registrable Securities at the time of receipt of such notice.

 

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2.7              Registration Expenses. The Company shall bear all costs and
expenses incurred in connection with any Demand Registration pursuant to Section
2.1, any Piggy-Back Registration pursuant to Section 2.2, and any registration
effected pursuant to Section 2.3 or Section 2.4, and all expenses incurred in
performing or complying with its other obligations under this Registration
Rights Agreement, whether or not the Registration Statement becomes effective,
including, without limitation: (i) all registration and filing fees; (ii) fees
and expenses of compliance with securities or “blue sky” laws (including fees
and disbursements of counsel in connection with blue sky qualifications of the
Registrable Securities); (iii) printing expenses; (iv) the Company’s internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees); (v) the fees and expenses incurred in connection with
the listing of the Registrable Securities as required by Section 2.5.1(k); (vi)
any other fees and expenses associated with filings required to be made with the
Financial Industry Regulatory Authority or any other regulatory authority; (vii)
fees and disbursements of counsel for the Company and fees and expenses for
independent certified public accountants retained by the Company (including the
expenses or costs associated with the delivery of any opinions or comfort
letters requested pursuant to Section 2.5.1(i); (viii) the reasonable fees and
expenses of any special experts retained by the Company in connection with such
registration; and (ix) the reasonable fees and expenses of one (1) legal counsel
for Olayan in connection with any such registration or offering (together with
any local counsel). The Company shall have no obligation to pay any underwriting
fees, including discounts or selling commissions, attributable to the
Registrable Securities being sold by the holders thereof, which underwriting
fees shall be borne by such holders. The holders shall not be required to pay
any other costs or expenses in connection with any registration or offering made
pursuant to this Registration Rights Agreement, other than their pro rata
portion of underwriting discounts or selling commissions and any fees and
expenses of legal counsel not otherwise paid by the Company pursuant to this
Section 2.7.

 

2.8              Information. The holders of Registrable Securities shall
provide such information as may reasonably be requested by the Company, or the
managing Underwriter, if any, in connection with the preparation of any
Registration Statement, including amendments and supplements thereto, in order
to effect the registration of any Registrable Securities under the Securities
Act pursuant to Article 2 and in connection with the Company’s obligation to
comply with federal and applicable state securities laws; provided, however,
that under no circumstances will the Company be permitted to file any
Registration Statement, amendment or supplement incorporating any information or
affidavits supplied by any holder of Registrable Securities or using the
holder’s name (collectively, the “Holder Information”) unless (i) such Holder
Information is incorporated verbatim as supplied by the holder (or in the case
of the holder’s name, incorporated exactly and only in the context consented to
by the holder (the “Approved Context”)) or (ii) the holder has consented in
writing to any modification to such Holder Information (or, in the case of the
holder’s name, has consented to use in a context broader than the Approved
Context).

 

ARTICLE 3

INDEMNIFICATION AND CONTRIBUTION

 

3.1              Indemnification by the Company. The Company agrees to indemnify
and hold harmless Olayan and each other holder of Registrable Securities, and
each of their respective officers, employees, affiliates, directors, partners,
members, attorneys and agents, and each person, if any, who controls Olayan and
each other holder of Registrable Securities (within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act) and each of their
respective officers, employees, affiliates, directors, partners, members,
attorneys and agents (each, an “Investor Indemnified Party”), from and against
any expenses, losses, judgments, claims, damages or liabilities, whether joint
or several, arising out of or based upon any untrue statement (or allegedly
untrue statement) of a material fact contained in any Registration Statement
under which the sale of such Registrable Securities was registered under the
Securities Act, any preliminary prospectus, final prospectus or summary
prospectus contained in the Registration Statement, or any amendment or
supplement to such Registration Statement, any free writing prospectus or any
written or oral materials distributed to or presented to investors at any
roadshow or other meetings with investors, or arising out of or based upon any
omission (or alleged omission) to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or any
violation by the Company of the Securities Act applicable to the Company and
relating to any action or inaction required of the Company in connection with
any such registration; and the Company shall promptly reimburse the Investor
Indemnified Party for any legal and any other expenses reasonably incurred by
such Investor Indemnified Party in connection with investigating and defending
any such expense, loss, judgment, claim, damage, liability or action as they are
incurred; provided, however, that the Company will not be liable in any such
case to the extent that any such expense, loss, claim, damage or liability
arises out of or is based upon any untrue statement or allegedly untrue
statement or omission or alleged omission made in such Registration Statement,
preliminary prospectus, final prospectus or summary prospectus, or any such
amendment or supplement, free writing prospectus or roadshow, in reliance upon
and in conformity with information furnished to the Company, in writing, by such
selling holder expressly for use therein.

 

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3.2              Indemnification by Holders of Registrable Securities. Each
selling holder of Registrable Securities will, in the event that any
registration is being effected under the Securities Act pursuant to this
Registration Rights Agreement of any Registrable Securities held by such selling
holder, indemnify and hold harmless the Company, each of its directors and
officers, each person, if any, who controls the Company within the meaning of
the Securities Act and each Underwriter (if any), and each other selling holder
and each other person, if any, who controls another selling holder or such
Underwriter within the meaning of the Securities Act, against any losses,
claims, judgments, damages or liabilities, whether joint or several, insofar as
such losses, claims, judgments, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or allegedly untrue
statement of a material fact contained in any Registration Statement under which
the sale of such Registrable Securities was registered under the Securities Act,
any preliminary prospectus, final prospectus or summary prospectus contained in
the Registration Statement, or any amendment or supplement to the Registration
Statement, or any free writing prospectus or any written or oral material
distributed or presented to investors at any roadshow or other meetings with
investors, or arise out of or are based upon any omission or the alleged
omission to state a material fact required to be stated therein or necessary to
make the statement therein not misleading, if the statement or omission was made
in reliance upon and in conformity with information furnished in writing to the
Company by such selling holder expressly for use therein, and shall reimburse
the Company, its directors and officers, and each other selling holder or
controlling person for any legal or other expenses reasonably incurred by any of
them in connection with investigating or defending any such loss, claim, damage,
liability or action. Each selling holder’s indemnification obligations hereunder
shall be several and not joint and shall be limited to the amount of any net
proceeds actually received by such selling holder. The parties hereto agree that
the only information furnished in writing to the Company by any selling holder
shall be information about the number of shares owned by such holder included in
the Registration Statement or prospectus, or any amendment or supplement
thereto, in the selling stockholder table.

 

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3.3              Conduct of Indemnification Proceedings. Promptly after receipt
by any person of any notice of any loss, claim, damage or liability or any
action in respect of which indemnity may be sought pursuant to Section 3.1 or
Section 3.2, such person (the “Indemnified Party”) shall, if a claim in respect
thereof is to be made against any other person for indemnification hereunder,
notify such other person (the “Indemnifying Party”) in writing of the loss,
claim, judgment, damage, liability or action; provided, however, that the
failure by the Indemnified Party to notify the Indemnifying Party shall not
relieve the Indemnifying Party from any liability which the Indemnifying Party
may have to such Indemnified Party hereunder, except and solely to the extent
the Indemnifying Party is actually prejudiced by such failure. If the
Indemnified Party is seeking indemnification with respect to any claim or action
brought against the Indemnified Party, then the Indemnifying Party shall be
entitled to participate in such claim or action, and, to the extent that it
wishes, jointly with all other Indemnifying Parties, to assume control of the
defense thereof with counsel satisfactory to the Indemnified Party. After notice
from the Indemnifying Party to the Indemnified Party of its election to assume
control of the defense of such claim or action, the Indemnifying Party shall not
be liable to the Indemnified Party for any legal or other expenses subsequently
incurred by the Indemnified Party in connection with the defense thereof other
than reasonable costs of investigation; provided, however, that in any action,
the Indemnified Party shall have the right to employ separate counsel (but no
more than one such separate counsel) to represent the Indemnified Party and its
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by the Indemnified Party against the
Indemnifying Party, with the fees and expenses of such counsel to be paid by
such Indemnifying Party if, based upon the written opinion of counsel of such
Indemnified Party, representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them or
because the Indemnified Party and Indemnifying Parties may have different or
conflicting defenses in any such action. No Indemnifying Party shall, without
the prior written consent of the Indemnified Party, consent to entry of judgment
or effect any settlement of any claim or pending or threatened proceeding in
respect of which the Indemnified Party is or could have been a party and
indemnity could have been sought hereunder by such Indemnified Party, unless
such judgment or settlement includes an unconditional release of such
Indemnified Party from all liability arising out of such claim or proceeding and
does not include a statement as to or an admission of fault, culpability or a
failure to act by or on behalf of an Indemnified Party.

 

3.4Contribution.

 

3.4.1        If the indemnification provided for in the foregoing Section 3.1,
Section 3.2 and Section 3.3 is unavailable to any Indemnified Party in respect
of or insufficient to cover any loss, claim, damage, liability or action
referred to herein, then each such Indemnifying Party, in lieu of indemnifying
such Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, claim, damage, liability or action
in such proportion as is appropriate to reflect the relative fault of the
Indemnified Parties and the Indemnifying Parties in connection with the actions
or omissions which resulted in such loss, claim, damage, liability or action, as
well as any other relevant equitable considerations. The relative fault of any
Indemnified Party and any Indemnifying Party shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by such Indemnified Party or such Indemnifying
Party and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.

 

3.4.2        The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 3.4 were determined by pro rata allocation
or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding Section 3.4.1.

 

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3.4.3        The amount paid or payable by an Indemnified Party as a result of
any loss, claim, damage, liability or action referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses incurred by such Indemnified Party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Article 3, no holder of Registrable
Securities shall be required to pay any amount in respect of indemnification
and/or contribution in excess of the dollar amount of the net proceeds (after
payment of any underwriting fees, discounts, commissions or taxes) actually
received by such holder from the sale of Registrable Securities which gave rise
to such indemnification and/or contribution obligation. 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. In addition, no holder of
Registrable Securities or any affiliate thereof shall be required to pay any
amount as contribution, unless such person or entity would have been required to
pay such amount pursuant to Section 3.2, if it had been applicable in accordance
with its terms.

 

3.4.4        The indemnity and contribution agreements contained herein shall be
in addition to any other rights to indemnification or contribution which any
Indemnified Party may have pursuant to law or contract and shall remain
operative and in full force and effect regardless of any investigation made or
omitted by or on behalf of any Indemnified Party and shall survive the transfer
of the Registrable Securities by any such Party. The indemnification and
contribution required by this Registration Rights Agreement shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or expense, loss, damage or liability
is incurred.

 

ARTICLE 4

RULE 144

 

4.1 Rule 144. The Company covenants that it shall file any reports required to
be filed by it under the Securities Act and the Exchange Act and shall take such
further action as the holders of Registrable Securities may reasonably request,
all to the extent required from time to time to enable such holders to sell
Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144 under the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission. To the extent any holder desires to sell
Registrable Securities pursuant to Rule 144, the Company agrees to provide
customary instructions to the transfer agent to remove any restrictive legends
from such securities and to provide or cause any customary opinions of counsel
to be delivered to the transfer agent in connection with any such sale. In
addition, the Company agrees to remove any restrictive legend from the
Registrable Securities upon the reasonable request of any holder as soon as
reasonably permitted by applicable law and customary practice (including
customary transfer agent practices).

 

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ARTICLE 5

MISCELLANEOUS

 

5.1              Assignment; No Third-Party Beneficiaries. This Registration
Rights Agreement and the rights, duties and obligations of the Company hereunder
may not be assigned or delegated by the Company in whole or in part. This
Registration Rights Agreement and the rights, duties and obligations of the
holders of Registrable Securities hereunder may be freely assigned or delegated
by such holder of Registrable Securities in conjunction with and to the extent
of any transfer of Registrable Securities by any such holder. This Registration
Rights Agreement and the provisions hereof shall be binding upon and shall inure
to the benefit of each of the Parties, to the permitted assigns of Olayan or
holder of Registrable Securities or of any assignee of Olayan or holder of
Registrable Securities. This Registration Rights Agreement is not intended to
confer any rights or benefits on any persons that are not party hereto other
than as expressly set forth in Article 3 and this Section 5.1.

 

5.2              Notices. All notices, demands, requests, consents, approvals or
other communications required or permitted to be given hereunder or which are
given with respect to this Registration Rights Agreement shall be in writing and
shall be personally served, delivered by reputable air courier service with
charges prepaid, or transmitted by hand delivery, telegram, telex or facsimile,
addressed as set forth below, or to such other address as such Party shall have
specified most recently by written notice. Notice shall be deemed given on the
date of service or transmission if personally served or transmitted by telegram,
telex or facsimile; provided that if such service or transmission is not on a
business day or is after normal business hours, then such notice shall be deemed
given on the next business day. Notice otherwise sent as provided herein shall
be deemed given on the next business day following timely delivery of such
notice to a reputable air courier service with an order for next-day delivery.

 

To the Company:

 

National Energy Services Reunited Corp.

777 Post Oak Blvd., Suite 800

Houston, Texas 77056

Attn: Sherif Foda, Chief Executive Officer

 

with a copy to:

 

Ellenoff Grossman & Schole LLP

1345 Avenue of the Americas

New York, NY 10105

Attn: Stuart Neuhauser, Esq.

 

To the Olayan:

 

P.O. Box 8772

Riyadh, 11492, Saudi Arabia

Attn: Fadi Otaqui

E-mail: F.Otaqui@olayangroup.com

 

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with a copy (which shall not constitute notice) to:

 

Shearman & Sterling (London) LLP

9 Appold Street

London EC2A 2AP

United Kingdom

Attn: Paul Strecker

E-mail: Paul.Strecker@Shearman.com

 

5.3              Severability. This Registration Rights Agreement shall be
deemed severable, and the invalidity or unenforceability of any term or
provision hereof shall not affect the validity or enforceability of this
Registration Rights Agreement or of any other term or provision hereof.
Furthermore, in lieu of any such invalid or unenforceable term or provision, the
parties hereto intend that there shall be added as a part of this Registration
Rights Agreement a provision as similar in terms to such invalid or
unenforceable provision as may be possible that is valid and enforceable.

 

5.4              Counterparts. This Registration Rights Agreement may be
executed in multiple counterparts, each of which shall be deemed an original,
and all of which taken together shall constitute one and the same instrument.

 

5.5              Entire Agreement. This Registration Rights Agreement (including
all agreements entered into pursuant hereto and all certificates and instruments
delivered pursuant hereto and thereto) constitutes the entire agreement of the
Parties with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements, representations, understandings, negotiations and
discussions between the Parties, whether oral or written.

 

5.6              Modifications and Amendments. No amendment, modification or
termination of this Registration Rights Agreement shall be effective against the
Company or any holder of Registrable Securities unless such amendment,
modification or termination is approved in writing by the Company and Olayan.

 

5.7              Titles and Headings. Titles and headings of sections of this
Registration Rights Agreement are for convenience only and shall not affect the
construction of any provision of this Registration Rights Agreement.

 

5.8              Waivers and Extensions. Any party to this Registration Rights
Agreement may waive any right, breach or default which such Party has the right
to waive; provided, however, that such waiver will not be effective against the
waiving Party unless it is in writing, is signed by such Party, and specifically
refers to this Registration Rights Agreement. Waivers may be made in advance or
after the right waived has arisen or the breach or default waived has occurred.
Any waiver may be conditional. No waiver of any breach of any agreement or
provision herein contained shall be deemed a waiver of any preceding or
succeeding breach thereof nor of any other agreement or provision herein
contained. No waiver or extension of time for performance of any obligations or
acts shall be deemed a waiver or extension of the time for performance of any
other obligations or acts.

 

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5.9              Remedies Cumulative. In the event that the Company fails to
observe or perform any covenant or agreement to be observed or performed under
this Registration Rights Agreement, Olayan or any other holder of Registrable
Securities may proceed to protect and enforce its rights by suit in equity or
action at law, whether for specific performance of any term contained in this
Registration Rights Agreement or for an injunction against the breach of any
such term or in aid of the exercise of any power granted in this Registration
Rights Agreement or to enforce any other legal or equitable right, or to take
any one or more of such actions, without being required to post a bond. None of
the rights, powers or remedies conferred under this Registration Rights
Agreement shall be mutually exclusive, and each such right, power or remedy
shall be cumulative and in addition to any other right, power or remedy, whether
conferred by this Registration Rights Agreement or now or hereafter available at
law, in equity, by statute or otherwise.

 

5.10          Governing Law. This Registration Rights Agreement shall be
governed by, interpreted under, and construed in accordance with the internal
laws of the State of New York applicable to agreements made and to be performed
within the State of New York.

 

5.11          Waiver of Trial by Jury. Each Party hereby irrevocably and
unconditionally waives the right to a trial by jury in any action, suit,
counterclaim or other proceeding (whether based on contract, tort or otherwise)
arising out of, connected with or relating to this Registration Rights
Agreement, the transactions contemplated hereby, or the actions of Olayan in the
negotiation, administration, performance or enforcement hereof.

 

5.12          Further Assurances. Each Party hereto shall do and perform or
cause to be done and performed all such further acts and things and shall
execute and deliver all such other agreements, certificates, instruments and
documents as any other Party hereto reasonably may request in order to carry out
the intent and accomplish the purposes of this Registration Rights Agreement and
the consummation of the transactions contemplated hereby.

 

5.13          Restructuring. To the extent that the board of directors or other
governing authority of the Company elects to effect a restructuring or
recapitalization of the Company or substantially all of the business of the
Company through a subsidiary or parent company of the Company or otherwise, the
provisions of this Registration Rights Agreement shall be appropriately
adjusted, and the holders of Registrable Securities and the Company shall enter
into such further agreements and arrangements as shall be reasonably necessary
or appropriate to provide the holders of Registrable Securities with
substantially the same registration rights as they would have under this
Registration Rights Agreement, giving due consideration to the nature of the new
public entity, the nature of the securities to be offered and tax and other
relevant considerations. The Company agrees that it shall not effect or permit
to occur any combination or subdivision of its capital stock which would
adversely affect the ability of any holder of any Registrable Securities to
include such Registrable Securities in any registration contemplated by this
Registration Rights Agreement or the marketability of such Registrable
Securities in any such registration. The provisions of this Registration Rights
Agreement shall apply, to the full extent set forth herein with respect to the
Registrable Securities, to any and all shares of capital stock of the Company,
any successor or assign of the Company (whether by merger, share exchange,
consolidation, sale of assets or otherwise) or any subsidiary or parent company
of the Company which may be issued in respect of, in exchange for or in
substitution of Registrable Securities and shall be appropriately adjusted for
any stock dividends, splits, reverse splits, combinations, recapitalizations and
the like occurring after the date hereof.

 

35

 

 

IN WITNESS WHEREOF, the Parties have caused this Registration Rights Agreement
to be executed and delivered by their duly authorized representatives as of the
date first written above.

 

 COMPANY:     NATIONAL ENERGY SERVICES REUNITED CORP.    By:   Name:   Title: 
    OLAYAN:      Hana Investments Co. WLL     By:   Name:   Title: 

 

[Signature Page to the Registration Rights Agreement]