Exhibit 10.2

FIRST AMENDMENT TO

STOCKHOLDER AGREEMENT

This FIRST AMENDMENT TO STOCKHOLDER AGREEMENT (this “First Amendment”) is made
and entered into as of June 20, 2019, by and between CARBO Ceramics Inc., a
Delaware corporation (the “Company”), and Wilks Brothers, LLC, a Texas limited
liability company (the “Stockholder”).

RECITALS

A.

The Company and certain holders of the Common Stock of the Company (the
“Stockholders”) are parties to that certain Stockholder Agreement dated as of
March 2, 2017 (the “Original Agreement,” collectively with and as amended by
this First Amendment, the “Agreement”).

B.

The Company and the Stockholder, in accordance with Section 7(j) of the Original
Agreement desire to amend the Original Agreement to reflect certain
modifications to the rights and obligations of the Stockholder, including,
without limitation, with respect to the composition of the Board of Directors of
the Company (the “Board”).

C.

Capitalized terms used, but not defined herein shall have the meaning ascribed
to such terms in the Original Agreement.

In consideration of good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto agree as follows:

1.Amendments to Original Agreement. Section 1(b)(i) of the Original Agreement is
deleted in its entirety and the following shall be inserted in lieu thereof:

“acquire, offer to acquire or agree to acquire Beneficial Ownership of any
Voting Securities or Convertible Securities that would result in the
Stockholder, together with the Stockholder’s Affiliates, Beneficially Owning
Voting Securities and Convertible Securities in excess of twenty-nine and
one-half percent (29.5%) of the Voting Securities outstanding at such time (the
“Ownership Limit”);”

2.Additions to Original Agreement.

(a)Section 6 of the Original Agreement is amended to add the following
definitions in the appropriate alphabetical order:

“Business” means the business of manufacturing, distributing, marketing or
selling (i) ceramic proppants, beads, particles, fines and any other ceramic
media for use in oilfield or industrial applications, (ii) silica-based products
for use in residential and commercial roofing applications and/or (iii) heat
treated silica based mineral products composed of greater than seventy percent
(70%) silica sand for interior surfaces and foundry applications.

“Convertible Securities” means securities or other interests that are
exchangeable for or convertible into Voting Securities, including the Amended
Warrant.

“Competitor” means any Person that is engaged, directly or indirectly, in the
Business.

 

--------------------------------------------------------------------------------

 

 

“Independent Director” means a director that meets the qualifications contained
in clauses (y) and (z) in Section 8(a)(ii).

“NYSE” means the New York Stock Exchange.

(b)A new Section 8 (“Board of Directors”) shall be inserted immediately
following Section 7(q) as follows:

“8.Board of Directors.

 

(a)

Board Representation.

 

(i)

Until such time as the rights of the Stockholder are terminated or reduced in
accordance with Section 8(f), (A) the Stockholder shall be entitled to designate
one (1) person for the Board to nominate for election to the Board as provided
in Section 8(b) hereof and (B) at any time the Stockholder is the Beneficial
Owner of at least twenty-five percent (25%) of the Voting Securities outstanding
at such time, the Stockholder shall be entitled to designate for nomination for
election to the Board an aggregate of two (2) members of the Board (each such
person so designated, a “Board Designee” and, in connection with (B), together
such designated persons, the “Board Designees”); provided, however, that any
Board Designee must also be subject to the approval of the Board’s nominating
and corporate governance committee, such approval not to be unreasonably
withheld; provided, further, that notwithstanding any term to the contrary in
this Stockholder Agreement, in no circumstances may the Stockholder appoint,
recommend, or designate any person other than the Board Designee or Board
Designees, as applicable, designated by the Stockholder pursuant to this Section
8(a) or appointed to fill a vacancy by the Stockholder as provided in Section
8(e) to serve on the Board.

 

 

(ii)

Any Board Designee must, as evaluated and determined by the Board in its good
faith discretion, (A) not be prohibited from serving as a director pursuant to
any rule or regulation promulgated by the SEC or any national securities
exchange on which the Voting Securities are listed; (B) not be, by any order,
judgment, or decree, enjoined from or otherwise limited with respect to serving
as a director of a public company; (C) not be an employee, officer or director
of a Competitor of the Company; and (D) be and remain in compliance with all of
the same policies, procedures, codes, rules, standards and guidelines applicable
to all of the other members of the Board, including the Company’s certificate of
incorporation and by-laws, each as then in effect, corporate governance
guidelines, insider trading policy (including pre-clearance policies and
procedures), and policies on stock ownership, public disclosures and
confidentiality. In addition, at least one (1) Board Designee designated
pursuant to Section 8(a)(i)(B) must (A) qualify as independent within the
meaning of (I) NYSE Listed Company Manual Rule 303A.02 (or as required by any
other exchange on which shares of Common Stock may be listed) for the purposes
of Board service, including service as an audit committee member on the Board’s
audit committee and service as a compensation committee member on the Board’s
compensation committee; (II) Rule 10A-3 under the Exchange Act for the purposes
of audit committee service on the Board’s audit committee; (III) Rule 16b-3
under the Exchange Act for the purposes of service on the Board

- 2 -

--------------------------------------------------------------------------------

 

 

 

committee charged with approving transactions in Company securities between the
Company and its directors and officers (for the purposes of which, “independent”
shall have the same meaning as “non-employee” director); and (IV) the Company’s
corporate governance and independence policies and guidelines; and (B) not be an
employee, officer or director of, or otherwise be an Affiliate of, the
Stockholder.

 

 

(b)

Initial and Subsequent Board Appointments.

 

(i)

Within three (3) business days of the execution and delivery of this First
Amendment, the Board shall expand the maximum number of directors serving on the
Board to seven (7) members and act to elect the Board Designee identified by the
Stockholder pursuant to Section 8(a)(i)(A); provided, that the Stockholder has
identified Justin Wilks as its initial Board Designee and the Company’s
nominating and corporate governance committee has approved such
designation.  Promptly following such time as the Stockholder shall have
provided written notice to the Company that it is entitled to nominate a second
member to the Board pursuant to Section 8(a)(i)(B), the Board shall promptly
expand the maximum number of directors serving on the Board to eight (8) members
and act to elect to the Board such second nominee identified by the Stockholder
in such notice.

 

 

(ii)

Each notice from the Stockholder designating a Board Designee, whether pursuant
to Section 8(b)(i), Section 8(c)(ii) or Section 8(e) shall be in writing, shall
be signed by a duly authorized representative of the Stockholder, shall certify
as of the date of such notice (y) the number of shares of Voting Securities
owned by the Stockholder, and (x) that, in the reasonable judgment of the
Stockholder, each Board Designee designated in such notice meets the
requirements contained in Section 8(a)(ii) as applicable, and shall be
accompanied by written evidence of the number of shares of Voting Securities
then owned by the Stockholder and its Affiliates.

 

 

(c)

Annual Meeting.

 

(i)

At each annual meeting of the Company’s stockholders or any special meeting in
lieu thereof at which the term of any Board Designee is to expire or at the date
on which proxy materials for such meeting are mailed to the Company’s
stockholders there shall be less than the maximum number of Board Designees that
the Stockholder is then entitled to designate pursuant to Section 8(a)(i)
serving on the Board, the Stockholder shall be entitled to designate the number
of persons necessary for the Board to nominate so that, if each such Board
Designee is elected to the Board at such annual meeting or any special meeting
in lieu thereof, the maximum number of Board Designees pursuant to Section
8(a)(i) shall be serving on the Board. In accordance with Section 8(a)(i), each
such Board Designee shall be subject to the approval of the Board’s nominating
and corporate governance committee, which such approval shall not be
unreasonably withheld. The Company and the Board shall, subject to and
consistent with the Board’s fiduciary duties and applicable law, take such
actions as are necessary to cause each Board Designee so designated by the
Stockholder to be nominated for election to the Board at each annual meeting of
the Company’s stockholders or any special meeting in lieu thereof. To the extent

- 3 -

--------------------------------------------------------------------------------

 

 

 

the Company’s proxy statement for any annual meeting of stockholders, or any
special meeting in lieu thereof, includes a recommendation regarding the
election of any other nominees to the Board, the Company and the Board shall,
subject to and consistent with the Board’s fiduciary duties and applicable law,
include a recommendation of its Board that the stockholders also vote in favor
of each Board Designee standing for election at such meeting.

 

 

(ii)

Except as provided in Section 8(b)(i) or Section 8(e), any action by the
Stockholder to designate a person for nomination for election to the Board
pursuant to this Section 8 shall be evidenced by a written notice complying with
Section 8(b)(ii) and furnished to the Board not later than January 10th of the
year in which the annual meeting of the Company’s stockholders for the election
of such designated person is to be held, or in the case of a special meeting,
within a reasonable time in advance of such meeting in order to allow the Board
to determine compliance with the qualifications required in this Agreement (and
otherwise to comply with its proxy solicitation and disclosure obligations in
connection with such meeting).  The Stockholder shall provide (x) the
information regarding each Board Designee as would be required to be included in
solicitations of proxies for the election of directors in an election context or
is otherwise required pursuant to the federal securities laws and regulations,
had the nominee been nominated, or intended to be nominated, by the Board and
(y) the consent of each such Board Designee to serve as a director of the
Company if so elected.

 

 

(d)

Size of Board.  For as long as the Stockholder has the right to designate one
(1) person for the Board to nominate for election to the Board, the maximum
number of directors on the Board shall not be increased to greater than seven
(7).  For as long as the Stockholder has the right to designate two (2) persons
for the Board to nominate for election to the Board, the maximum number of
directors on the Board shall not be increased to greater than eight (8).  

 

(e)

Vacancies. If, prior to his or her election or appointment to the Board pursuant
to this Section 8, any Board Designee shall be unable or unwilling to serve as a
director of the Company, then the Stockholder shall be entitled to designate a
replacement Board Designee. Such replacement Board Designee shall be subject to
the approval of the Board’s nominating and corporate governance committee, such
approval not to be unreasonably withheld. The Company and the Board shall,
subject to and consistent with the Board’s fiduciary duties and applicable law,
take such actions as are necessary to cause such replacement Board Designee to
be appointed to the Board or nominated and submitted to the stockholders, as
applicable, pursuant to this Section 8. If, following an election or appointment
to the Board pursuant to this Section 8, any Board Designee shall resign or be
removed or be unable to serve for any reason prior to the expiration of his or
her term as a director of the Company, then the Stockholder shall, within thirty
(30) days of such event, notify the Board in writing of a replacement Board
Designee, and the Company and the Board shall, subject to and consistent with
the Board’s fiduciary duties and applicable law, take such actions as are
necessary to cause such replacement Board Designee to be appointed to the Board
to fill the unexpired term of the Board Designee who such new Board Designee is
replacing. Any action by the Stockholder to designate a replacement director
pursuant to this Section 8(e) shall be evidenced by a written notice complying
with Section 8(b)(ii) and furnished to the Board within a reasonable time
following the creation of a related vacancy.

- 4 -

--------------------------------------------------------------------------------

 

 

 

(f)

Reduction; Termination of Rights.  The right of the Stockholder to designate
directors under this Section 8 shall be reduced and terminated as follows:

 

(i)

In the event that the Stockholder’ (together with its Affiliates’) Beneficial
Ownership of Voting Securities is reduced to less than twenty-five percent
(25%), the Stockholder’s right to designate members to the Board pursuant to
Section 8(a) shall be reduced to the right to designate one (1) member of the
Board; provided, that the then current term of the Board Designees then serving
on the Board shall not be affected solely by the loss of such right.

 

 

(ii)

In the event that the Stockholder’s (together with its Affiliates’) Beneficial
Ownership of Voting Securities is reduced to less than five percent (5%), the
Stockholder’s right to designate members to the Board pursuant to Section 8(a)
shall immediately expire; provided, that the then current term of the Board
Designees then serving on the Board shall not be affected solely by the loss of
such right.

 

 

(g)

Company Policies; Fees; Costs and Expenses.  The parties hereto acknowledge that
each Board Designee, upon election to the Board, will serve as a member of the
Board and will be governed by the same protections and obligations regarding
confidentiality, conflicts of interest, related party transactions, fiduciary
duties, codes of conduct, trading and disclosure policies, director resignation
policies, and other governance guidelines and policies of the Company as other
directors, and shall be required to preserve the confidentiality of Company
business and information, including discussions or matters considered in
meetings of the Board or committees of the Board, and shall have the same rights
and benefits, including with respect to insurance, indemnification and
compensation that are applicable to all Directors of the Company.  The Company
will pay and reimburse each Board Designee for all reasonable out-of-pocket
expenses incurred by such Board Designee in connection with his or her
participation in (or attendance at) meetings of the Board (and committees
thereof) and the boards of directors (and committees thereof) of the
subsidiaries of the Company to the same extent as the Company reimburses all
other directors of the Company.”

 

3.

Representations and Warranties of the Stockholder.  

(a)The Stockholder and its Affiliates are the sole record and Beneficial Owners
of the Voting Securities set forth on Annex A opposite the Stockholder or such
Affiliate’s name and such securities constitute all of the securities of the
Company owned of record or Beneficially Owned by the Stockholder and its
Affiliates.

(b)The Stockholder is duly organized, validly existing and in good standing
under the Laws of the State of Texas.  The Stockholder has full power and
authority to execute and deliver this First Amendment, to perform its
obligations under this First Amendment and to consummate the transactions
contemplated hereby.

(c)Neither the execution and delivery of this First Amendment by the
Stockholder, nor the consummation of the transactions contemplated hereby, nor
compliance by the Stockholder with any of the terms or provisions hereof and
thereof will (i) violate any provision of the Stockholder’s organizational
documents or (ii) conflict with, violate any provision of, or require the
consent or approval of any Person under applicable Law or any contract or
agreement to which the Stockholder is a party, except for any such conflicts or
violations, or consents or approvals the failure to receive which will not,
individually or in the

- 5 -

--------------------------------------------------------------------------------

 

 

aggregate, be reasonably be expected to prevent or materially delay the closing
of the transactions contemplated by this First Amendment or the performance by
the Stockholder of any of its obligations under this First Amendment.

(d)The execution, delivery and performance of this First Amendment by the
Stockholder have been duly authorized by all necessary action on the part of the
Stockholder.  This First Amendment have been duly executed and delivered by the
Stockholder and, assuming the due authorization, execution and delivery by each
of the other parties hereto, constitutes valid and binding obligations of the
Stockholder, enforceable against the Stockholder in accordance with its terms,
except as may be limited by bankruptcy, insolvency, moratorium, reorganization
or similar Laws affecting the rights of creditors generally and the availability
of equitable remedies.

4.Representations and Warranties of the Company.  

(a)The Company is duly organized, validly existing and in good standing under
the Laws of its jurisdiction of organization.  The Company has full power and
authority to execute and deliver this First Amendment and the amended Warrant,
dated as of the date hereof (the “Amended Warrant”), to perform its obligations
under the First Amendment and the Amended Warrant and to consummate the
transactions contemplated hereby and thereby.

(b)Neither the execution and delivery of this First Amendment or the Amended
Warrant by the Company, nor the consummation of the transactions contemplated
hereby and thereby, nor compliance by the Company with any of the terms or
provisions hereof and thereof will (i) violate any provision of the
organizational documents of the Company or (ii) conflict with, violate any
provision of, or require the consent or approval of any Person under applicable
Law or any contract or agreement to which the Company is a party, except for any
such conflicts or violations, or consents or approvals the failure to receive
which will not, individually or in the aggregate, be reasonably be expected to
prevent or materially delay the closing of the transactions contemplated by this
First Amendment or the performance by the Company of any of its obligations
under this First Amendment or the Amended Warrant.

(c)The execution, delivery and performance of this First Amendment and the
Amended Warrant by the Company have been duly authorized by all necessary action
on the part of the Company.  This First Amendment and the Amended Warrant have
been duly executed and delivered by the Company and, assuming the due
authorization, execution and delivery by the Stockholder, constitute valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms, except as may be limited by bankruptcy, insolvency,
moratorium, reorganization or similar Laws affecting the rights of creditors
generally and the availability of equitable remedies.

(d)There is no pending action, suit, claim, inquiry, investigation, audit or
proceeding by or before any governmental authority, or any arbitration,
mediation or other similar proceeding (each of the foregoing, a “Proceeding”),
and to the knowledge of the Company, there is no Proceeding threatened in
writing against the Company or any of its subsidiaries, that seeks to prevent,
delay or impair the transactions contemplated hereby or any action taken or to
be taken pursuant hereto.

5.Further Actions.  The Company and the Board shall, subject to and consistent
with the Board’s fiduciary duties and applicable law, take such actions as are
necessary (including amending the certificate of incorporation and by-laws of
the Company, if applicable) to (i) cause Board Designees to be nominated and
submitted to the stockholders of the Company for election to the Board, or
appointed to the Board by the remaining members of the Board, as provided in
Section 8(b) and Section 8(c), and (ii) ensure that the Company complies with
and implements the provisions of the Agreement, as amended by this First
Amendment.

- 6 -

--------------------------------------------------------------------------------

 

 

6.Effect of First Amendment.  This First Amendment constitutes the entire
agreement of the parties with respect to the subject matter hereof, and
supersedes all prior oral or written communications, memoranda, proposals,
negotiations, discussions, term sheets and commitments with respect to the
subject matter hereof.  Except as expressly provided herein, no other changes or
modifications to the Original Agreement, are intended or implied by this First
Amendment, and in all other respects the Original Agreement is specifically
ratified, restated and confirmed by the parties hereto as of the effective date
of this First Amendment.  No provision or term of this First Amendment may be
modified, altered, waived, discharged or terminated orally, but only by an
instrument in writing executed by the party against whom such modification,
alteration, waiver, discharge or termination is sought to be enforced.  The
applicable provisions of this First Amendment and the Original Agreement shall
be read and interpreted as one agreement. To the extent that any provision of
the Original Agreement conflicts with any provision of this First Amendment, the
provision of this First Amendment shall control.

7.Governing Law.  This First Amendment will be governed by and construed in
accordance with the laws of the State of Delaware, without giving effect to any
choice of law principles.  

8.Severability.  The provisions of this First Amendment will be deemed severable
and the invalidity or unenforceability of any provision will not affect the
validity or enforceability of the other provisions hereof; provided that if any
provision of this First Amendment, as applied to any party or to any
circumstance, is judicially determined not to be enforceable in accordance with
its terms, the parties agree that the court judicially making such determination
may modify the provision in a manner consistent with its objectives such that it
is enforceable, and/or to delete specific words or phrases, and in its modified
form, such provision will then be enforceable and will be enforced.

9.Counterparts.  This First Amendment may be executed in two or more
counterparts (including by facsimile or other electronic means), each of which
will be deemed an original but all of which together will constitute one and the
same instrument.  This First Amendment will become effective when one or more
counterparts have been signed by each of the parties and delivered to the other
parties.

10.Construction of Terms.  This First Amendment has been freely and fairly
negotiated among the parties.  If an ambiguity or question of intent or
interpretation arises, this First Amendment will be construed as if drafted
jointly by the parties and no presumption or burden of proof will arise favoring
or disfavoring any party because of the authorship of any provision of this
First Amendment.  Any reference to any law will be deemed also to refer to such
law as may be amended from time to time and all rules and regulations
promulgated thereunder, unless the context requires otherwise.  The words
“include,” “includes,” and “including” will be deemed to be followed by “without
limitation.” Pronouns in masculine, feminine, and neuter genders will be
construed to include any other gender, and words in the singular form will be
construed to include the plural and vice versa, unless the context otherwise
requires. The words “this First Amendment,” “herein,” “hereof,” “hereby,”
“hereunder,” and words of similar import refer to this First Amendment as a
whole and not to any particular subdivision unless expressly so limited. The
parties intend that each representation, warranty, and covenant contained herein
will have independent significance. If any party has breached any covenant
contained herein in any respect, the fact that there exists another covenant
relating to the same subject matter (regardless of the relative levels of
specificity) which the party has not breached will not detract from or mitigate
the fact that the party is in breach of the first covenant.  

11.Headings.  The headings listed herein are for convenience only and do not
constitute matters to be construed in interpreting this First Amendment.

- 7 -

--------------------------------------------------------------------------------

 

 

12.Termination.  The Agreement shall terminate automatically upon the earlier to
occur of: (i) the Stockholder’s (together with its Affiliates’) Beneficial
Ownership being reduced to less than five percent (5%); and (ii) the three (3)
year anniversary of this First Amendment.

[SIGNATURE PAGES FOLLOW]

 

- 8 -

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties have executed this First Amendment as of the
date first above written.

 

COMPANY:

 

 

CARBO CERAMICS INC.

 

 

By: /s/ Gary Kolstad

Name: Gary Kolstad

Title: President

 

 

 

WILKS BROTHERS, LLC

 

 

By: /s/ Morgan D. Neff

Name: Morgan D. Neff

Title: Authorized Representative

 

 

 

 

 

[signature page to First Amendment to Stockholder Agreement]