EXHIBIT 10.3ExecutionVersion  STOCK PURCHASE AGREEMENTbetweenPRIDE INTERNATIONAL, INC.,REDFISH HOLDINGS S. DE R.L. DE C.V.,PRIDE INTERNATIONAL LTD.,PRIDE SERVICES LTD.andGULF OF MEXICO PERSONNEL SERVICES S. DE R.L. DE C.V.as SELLERSandGP INVESTMENTS LTD.as BUYER Dated as of August 9, 2007   
 

 
TABLE OF CONTENTS         ARTICLE I PURCHASE AND SALE  2   Section 1.1 Purchase and Sale  2   Section 1.2 Time and Place of Closing  3   Section 1.3 Deliveries by the Sellers  3   Section 1.4 Deliveries by the Buyer  3   Section 1.5 Intellectual Property  4   Section 1.6 Allocation of Purchase Price  4   Section 1.7 Books and Records  4   Section 1.8 No Ongoing or Transition Services  4   Section 1.9 Intercompany Accounts and Agreements  5   Section 1.10 Distribution; Purchase Price Adjustments  5          ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE SELLERS  6   Section 2.1 Organization; Etc  6   Section 2.2 Authority Relative to this Agreement  8   Section 2.3 Capitalization  8   Section 2.4 Ownership of Shares  9   Section 2.5 Contracts  9   Section 2.6 Consents and Approvals; No Violations  10   Section 2.7 Financial Statements  11   Section 2.8 Absence of Undisclosed Liabilities  11   Section 2.9 Absence of Certain Changes  11   Section 2.10 Litigation  12   Section 2.11 Compliance with Law  12   Section 2.12 Employee Benefit Plans  12   Section 2.13 Employees; Labor and Employment Matters  13   Section 2.14 Taxes  13   Section 2.15 Title, Ownership and Related Matters  14   Section 2.16 Rigs and E&P Equipment  15   Section 2.17 Environmental Matters  16   Section 2.18 Insurance  17   Section 2.19 Brokers; Finders and Fees  17   Section 2.20 Receivables  18   Section 2.21 Permits  18   Section 2.22 Powers of Attorney; Officers and Directors  18   Section 2.23 Suppliers  18   Section 2.24 Customers  19   Section 2.25 Intellectual Property  19   Section 2.26 Representations of the Sellers Refer to the Business  20          ARTICLE III REPRESENTATIONS AND WARRANTIES OF BUYER  20   Section 3.1 Organization; Etc  20   Section 3.2 Authority Relative to this Agreement  20   Section 3.3 Consents and Approvals; No Violations  20   Section 3.4 Acquisition of Shares for Investment  21 
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           Section 3.5 Availability of Funds  21   Section 3.6 Litigation  21   Section 3.7 Balance Sheet  22   Section 3.8 Investigation by the Buyer; No Reliance; Sellers’ Liability  22   Section 3.9 Brokers; Finders and Fees  23          ARTICLE IV COVENANTS OF THE PARTIES  23   Section 4.1 Conduct of Business  23   Section 4.2 Access to Information; Confidentiality  25   Section 4.3 Consents; Cooperation  27   Section 4.4 Consultation  28   Section 4.5 Commercially Reasonable Efforts  28   Section 4.6 Public Announcements  28   Section 4.7 Tax Matters  29   Section 4.8 Withholding Taxes  34   Section 4.9 Employees; Employee Benefits  35   Section 4.10 Supplemental Disclosure  37   Section 4.11 Advice of Changes  37   Section 4.12 Performance Bonds  37   Section 4.13 Restricted Activities  38   Section 4.14 Financing  38          ARTICLE V CONDITIONS TO CONSUMMATION OF THE PURCHASE  39   Section 5.1 Conditions to Each Party’s Obligations to Consummate the Purchase  39   Section 5.2 Further Conditions to the Sellers’ Obligations  39   Section 5.3 Further Conditions to the Buyer’s Obligations  40   Section 5.4 Frustration of Closing Conditions  40          ARTICLE VI TERMINATION AND ABANDONMENT  40   Section 6.1 Termination  40   Section 6.2 Procedure for and Effect of Termination  41          ARTICLE VII SURVIVAL AND INDEMNIFICATION  42   Section 7.1 Survival Periods  42   Section 7.2 PII’s Agreement to Indemnify  42   Section 7.3 Buyer’s Agreement to Indemnify  44   Section 7.4 Third-Party Indemnification  45   Section 7.5 No Setoff  46   Section 7.6 Insurance  46   Section 7.7 No Duplication  46   Section 7.8 Sole Remedy  46   Section 7.9 No Special Damages  47   Section 7.10 Express Negligence  47          ARTICLE VIII MISCELLANEOUS PROVISIONS  47   Section 8.1 Amendment and Modification  47   Section 8.2 Entire Agreement; Assignment; Binding Effect  47 
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           Section 8.3 Severability  47   Section 8.4 Notices  48   Section 8.5 Governing Law  49   Section 8.6 Dispute Resolution  49   Section 8.7 Descriptive Headings  51   Section 8.8 Counterparts  51   Section 8.9 Fees and Expenses  51   Section 8.10 Interpretation  51   Section 8.11 Third-Party Beneficiaries  52   Section 8.12 No Waivers  52   Section 8.13 Specific Performance  52    EXHIBIT A Form of Transition Services Agreement
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**GLOSSARY OF DEFINED TERMS**     Defined Terms Where Defined     AAA Section 8.6(a)(ii)Affected Employees Section 4.9(c)affiliate Section 8.10(b)(i)Agreement PreambleAlternative Financing Section 4.14Antitrust Regulations Section 2.6Auditors Section 1.10(b)Base Net Working Capital Section 1.10(c)Benefit Plans Section 4.9(d)Business RecitalsBusiness Intellectual Property Section 2.25(a)Business Material Adverse Effect Section 2.1(b)Buyer PreambleBuyer Damages Section 7.2(a)Buyer Indemnitees Section 7.2(a)Buyer Material Adverse Effect Section 3.1Buyer Plan Section 4.9(d)Buyer Proprietary Information Section 4.2(d)Buyer Tax Benefit Section 4.7(g)Claim Section 7.4Closing Section 1.2Closing Date Section 1.2Closing Date Schedule Section 1.10(b)Closing Statement Section 1.10(b)Code Section 1.6Companies RecitalsCompany RecitalsCompany Contracts Section 2.5(b)Confidentiality Agreement Section 4.2(b)Contracts Section 2.5(a)Current Assets Section 1.10(b)Current Liabilities Section 1.10(b)Due Date Section 4.7(j)Due Diligence Information Section 3.8(b)E&P Equipment Section 2.16(b)E&P Services Business RecitalsElecting Target Section 4.7(a)(iii)Environment Section 2.17Environmental Claims Section 2.17(c)Environmental Law Section 2.17Environmental Permits Section 2.17(b)ERISA Section 2.12(c)Financing Section 3.5
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     Defined Terms Where Defined     Financing Commitment Section 3.5Financing Modification Requirements Section 4.14Financial Statements Section 2.7Foreign Tax Credit Loss Amount Section 4.7(a)(iii)GAAP Section 1.10(b)GOMPS PreambleGovernmental Entity Section 2.6HAPSA RecitalsHazardous Substance Section 2.17Law Section 2.6Leases Section 2.15(b)Liens Section 2.4MC RecitalsNet Working Capital Section 1.10(b)Operating Employees Section 4.9(a)Owned Property Section 2.15(b)party PreamblePayor Section 4.7(c)(iii)Permits Section 2.21Permitted Liens Section 2.15(a)person Section 8.10(b)(ii)PetroTech RecitalsPIBL RecitalsPII PreamblePIL PreamblePIL Sub Shares RecitalsPISRL RecitalsPlans Section 2.12(a)PPSRL RecitalsPPSRL Shares RecitalsPreparer Section 4.7(c)(iii)Proceeding Section 2.10PSAL RecitalsPSL PreamblePSL Sub Shares RecitalsPurchase Section 1.1Purchase Price Section 1.1(e)Real Property Section 2.15(b)Recipient Section 4.7(d)(i)Redfish PreambleRelease Section 2.17Remedial Action Section 2.17Representatives Section 8.6(a)(i)Restricted Activities Section 4.13(d)Rigs Section 2.16(a)Section 338 Schedule Section 4.7(a)(iii)
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     Defined Terms Where Defined     Seller PreambleSellers PreambleSeller Damages Section 7.3(a)Seller Disclosure Letter Article IISeller Indemnitees Section 7.3(a)Seller Tax Detriment Section 4.7(g)Seller Trademarks and Logos Section 1.5Shares RecitalsSubsidiary Section 8.10(b)(iii)Survival Period Section 7.1Target Section 4.7(a)(iii)Tax Section 4.7(j)Tax Audit Section 4.7(d)(i)Tax Item Section 4.7(j)Tax Returns Section 2.14(a)Technology Section 2.25(c)Territory Section 4.13(d)Transfer Taxes Section 4.7(e)Transition Services Agreement Section 1.8Twin Oaks RecitalsTwin Oaks Shares RecitalsVoting Company Debt Section 2.3(a)
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**STOCK PURCHASE AGREEMENT**          STOCK PURCHASE AGREEMENT, dated as of August 9, 2007 (this “**Agreement**”), is by and betweenPride International, Inc., a Delaware corporation (“**PII**”), Redfish Holdings S. de R.L. de C.V., aMexican limited liability company and indirect, wholly owned subsidiary of PII (“**Redfish**”), PrideInternational Ltd., a British Virgin Islands company and direct, wholly owned subsidiary of PII(“**PIL**”), Pride Services Ltd., a British Virgin Islands company and indirect, wholly ownedsubsidiary of PII (“**PSL**”), and Gulf of Mexico Personnel Services S. de R.L. de C.V., a Mexicanlimited liability company and indirect, wholly owned subsidiary of PIL (“**GOMPS**” and, together withPII, Redfish, PIL and PSL, sometimes collectively referred to herein as the “**Sellers**” and,individually, as a “**Seller**”), and GP Investments Ltd., a Bermuda company (the “**Buyer**”). TheSellers and the Buyer are hereinafter collectively referred to as the “**parties**” and eachindividually as a “**party**.”          WHEREAS, PII, through its direct or indirect subsidiaries Perforaciones Pride S. de R.L. deC.V., a Mexico company (“**PPSRL**”), Marlin Colombia Drilling Co. Inc., a British Virgin Islandscompany (“**MC**”), Pride South America Ltd., a British Virgin Islands company (“**PSAL**”), PrideInternational S.R.L., an Argentina limited liability company (“**PISRL**”), Pride International BoliviaLtda., a Bolivia limited liability company (“**PIBL**”), PetroTech S.A.I.C., an Argentina corporation(“**PetroTech**”), Hispano Americana de Petroleos S.R.L., an Argentina limited liability company(“**HAPSA**”), and Twin Oaks Financial Ltd., a British Virgin Islands company (“**Twin Oaks**” and,together with PPSRL, MC, PSAL, PISRL, PIBL, PetroTech and HAPSA, sometimes collectively referred toherein as the “**Companies**” and, individually, as a “**Company**”), is engaged in (i) the land contractdrilling and workover business in Latin America, primarily in Argentina, Venezuela, Colombia,Bolivia and Mexico, and associated assets that are used in connection with the operation of suchbusiness and (ii) the business of providing pressure pumping, formation testing, underbalancedrilling, drilling fluids, directional drilling, fishing tools, production services and relatedservices to exploration and production companies in one or more of Argentina, Bolivia, Brazil,Colombia, Ecuador, Peru and Venezuela (the “**E&P Services Business**” and, together with the businessdescribed in clause (i), collectively, the “**Business**”);          WHEREAS, PIL owns 100% of the issued and outstanding capital stock of PSAL and MC;          WHEREAS, PIL, together with Jorge R. Postiglione, as third-party nominee on behalf of PIL,owns 100% of the issued and outstanding capital stock of PISRL;          WHEREAS, PIL and PISRL collectively own 100% of the issued and outstanding capital stock ofPIBL;          WHEREAS, Redfish and GOMPS collectively own 100% of the issued and outstanding capital stockof PPSRL;          WHEREAS, PISRL and PSL collectively own 100% of the issued and outstanding capital stock ofPetroTech and HAPSA;
 

 
          WHEREAS, PII owns 100% of the issued and outstanding capital stock of Twin Oaks; and          WHEREAS, upon the terms and subject to the conditions set forth herein, (i) PIL desires tosell and the Buyer desires to purchase all of the then issued and outstanding capital stock of MC,PSAL, PIBL and PISRL owned by PIL (collectively, the “**PIL Sub Shares**”), (ii) each of Redfish andGOMPS desires to sell and the Buyer desires to purchase all of the then issued and outstandingcapital stock of PPSRL owned by it (the “**PPSRL Shares**”), (iii) PSL desires to sell and the Buyerdesires to purchase all of the then issued and outstanding capital stock of PetroTech and HAPSAowned by PSL (collectively, the “**PSL Sub Shares**”), and (iv) PII desires to sell and the Buyerdesires to purchase all of the then issued and outstanding capital stock of Twin Oaks (the “**TwinOaks Shares**” and, together with the PIL Sub Shares, the PPSRL Shares and the PSL Sub Shares, the“**Shares**”), after which all of the issued and outstanding capital stock of the Companies would beowned, directly or indirectly, by the Buyer;          NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties,covenants and agreements contained in this Agreement, and intending to be legally bound, theparties agree as follows:ARTICLE IPURCHASE AND SALE          Section 1.1 *Purchase and Sale*. Upon the terms and subject to the conditions of this Agreement, at the Closing:     (a) PIL will sell, convey, assign, transfer and deliver to the Buyer, and the Buyerwill purchase, acquire and accept from PIL, the PIL Sub Shares;     (b) Each of Redfish and GOMPS will sell, convey, assign, transfer and deliver to theBuyer, and the Buyer will purchase, acquire and accept from Redfish and GOMPS, the PPSRLShares;     (c) PSL will sell, convey, assign, transfer and deliver to the Buyer, and the Buyerwill purchase, acquire and accept from PSL, the PSL Sub Shares;     (d) PII will sell, convey, assign, transfer and deliver to the Buyer, and the Buyerwill purchase, acquire and accept from PII, the Twin Oaks Shares;     (e) The Buyer will pay to the Sellers, in consideration for the Shares, an aggregateamount of $1,000,000,000 in cash, subject to adjustment as provided in Section 1.10. Tofacilitate the Purchase (as defined below), the Buyer will pay to PII, for the account andas agent of each of the Sellers, the amount set forth in the immediately preceding sentence,by wire transfer of immediately available funds to an account or accounts designated inwriting by PII at least two business days prior to the Closing Date (the “**Purchase Price**”).
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          The transactions contemplated by this Section 1.1 are sometimes referred to as the “**Purchase**.”          Section 1.2 *Time and Place of Closing*. The closing of the transactions contemplated by this Agreement (the “**Closing**”) will take placeat the offices of Baker Botts L.L.P., One Shell Plaza, 910 Louisiana Street, Houston, Texas77002-4995, at 9:00 a.m. (central time) on the later of (i) August 31, 2007 or (ii) the firstbusiness day following the date on which all of the conditions to each party’s obligations underthis Agreement have been satisfied or, to the extent permitted, waived (other than those conditionsthat by their nature are to be satisfied on the Closing Date (as defined below), but subject to thesatisfaction or, to the extent permitted, waiver of such conditions), or at such other date, placeor time as the parties may otherwise agree. The date on which the Closing occurs and thetransactions contemplated by this Agreement become effective is referred to as the “**Closing Date**.”          Section 1.3 *Deliveries by the Sellers*. Upon the terms and subject to the conditions of this Agreement, at the Closing, the Sellers willdeliver (or cause to be delivered) the following to the Buyer:     (a) Certificates representing the Shares and/or affidavits of ownership thereof,accompanied by stock powers duly endorsed in blank or accompanied by duly executedinstruments of transfer;     (b) The resignations (or evidence of the removal) of the members of the Boards ofDirectors (or other governing body) of each of the Companies and their respectiveSubsidiaries, as requested by the Buyer, and the delivery of releases of any claim againstthe Companies and their respective Subsidiaries;     (c) A certificate of PII, executed on its behalf by the Chief Executive Officer, thePresident or a Vice President of PII, certifying as to the fulfillment of the conditions setforth in Section 5.3 hereof;     (d) An executed counterpart of the Transition Services Agreement by PII; and     (e) All other documents, instruments and writings required to be delivered by theSellers at or (to the extent not previously delivered) prior to the Closing under thisAgreement.          Section 1.4 *Deliveries by the Buyer*. Upon the terms and subject to the conditions of this Agreement, at the Closing, the Buyer willdeliver (or cause to be delivered) the following to the Sellers:     (a) The Purchase Price, in immediately available funds, as set forth in Section 1.1 ofthis Agreement;     (b) A certificate of the Buyer, executed on its behalf by the Chief Executive Officer,the President or a Vice President of the Buyer, certifying as to the fulfillment of theconditions set forth in Section 5.2 hereof;
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     (c) An executed counterpart of the Transition Services Agreement by the Buyer; and     (d) All other documents, instruments and writings required to be delivered by the Buyerat or (to the extent not previously delivered) prior to the Closing under this Agreement.          Section 1.5 *Intellectual Property*. It is expressly agreed that the Buyer is not purchasing, acquiring or otherwise obtaining anyright, title or interest in the name “Pride” or any derivative thereof, or any trade names,trademarks, identifying logos or service marks related thereto or employing the words “Pride” orany part or variation of any of the foregoing or any confusingly similar trade names, trademarks,logos or service marks (collectively, the “**Seller Trademarks and Logos**”), and any right, title orinterest the Companies or any of their respective Subsidiaries may have in the Seller Trademarksand Logos shall terminate as of the Closing. Neither the Buyer nor any of its affiliates shallmake any use of the Seller Trademarks and Logos from and after 90 days following the Closing,including through the use of stationery or letterhead. The Buyer shall, at its own cost and within90 days from the Closing Date, remove from the Rigs (as defined below) and the other properties andassets of the Companies and their respective Subsidiaries, or paint over, any and all of the SellerTrademarks and Logos.          Section 1.6 *Allocation of Purchase Price*. Not later than 15 calendar days after the Closing Date Schedule and Closing Statement becomefinal and binding on the parties pursuant to Section 1.10(b), PII and the Buyer shall agree on anallocation of the Purchase Price to the stock of each Company, subject to Section 1.6 of the SellerDisclosure Letter. If PII and the Buyer are unable to agree on such allocation, the matters indispute shall, under procedures similar to those in Section 1.10(b), be submitted to Ernst & YoungLLP or such other independent accounting firm as may be approved by PII and the Buyer, which firmshall render its opinion as to such specific matters. Except as required pursuant to applicableLaw (as defined below) or a determination (as defined in Section 1313 of the Internal Revenue Codeof 1986, as amended (the “**Code**”), or any similar provision of Law), none of the parties, directlyor indirectly, through a subsidiary or affiliate or otherwise, will take a position on any TaxReturn (as defined below) or in any judicial proceeding that is in any way inconsistent with theallocation set forth in this Section 1.6.          Section 1.7 *Books and Records*. The Sellers shall deliver to the Buyer at or as soon as practicable (but in any event not laterthan 10 days) after the Closing all books and records of the Companies and their Subsidiaries(including books of account, personnel and payroll records and the like), including the books andrecords of the Companies relating to Taxes (as defined below) and Tax Returns. The Sellers mayretain copies of any books and records delivered to the Buyer.          Section 1.8 *No Ongoing or Transition Services*. Except as provided for in the Transition Services Agreement dated the Closing Date between PIIand the Buyer, substantially in the form of Exhibit A hereto (the “**Transition Services Agreement**”),at the Closing, all data processing, accounting, insurance, banking, personnel, legal,communications and other products and services provided to the Companies or any of their respectiveSubsidiaries by PII or any of
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its other affiliates, including any agreements or understandings(written or oral) with respect thereto, will terminate.          Section 1.9 *Intercompany Accounts and Agreements*. Except for accounts payable—affiliates and notes payable—affiliates reflected on the ClosingDate Schedule and except as set forth in Section 1.9 of the Seller Disclosure Letter, on or priorto the Closing Date, all intercompany accounts, leases and other Contracts between any of theCompanies or their respective Subsidiaries, on the one hand, and PII or its affiliates (other thanthe Companies or any of their respective Subsidiaries), on the other hand, shall be canceled, paidor otherwise settled. Subject to Section 1.10 of this Agreement, no adjustment shall be made tothe Purchase Price as a result of any such cancellation.          Section 1.10 *Distribution; Purchase Price Adjustments*          (a) The parties agree that, so long as any distributions made are reflected in the ClosingDate Schedule and in any adjustments to the Purchase Price under Section 1.10(c), the Sellers shallhave the right, at or prior to the Closing, to cause any Company and its Subsidiaries to distributecash, accounts receivable and any other working capital items (except inventory) to the Sellers ortheir affiliates, by one or more dividends, repurchases of existing stock and/or otherdistributions; provided, however, that no Company or Subsidiary incorporated in Argentina will paya dividend or otherwise make any distribution to its shareholders.          (b) Within 90 calendar days following the Closing, PII shall prepare, or cause to be prepared,and deliver to the Buyer a schedule of components of combined Net Working Capital of the Companiesand the Subsidiaries thereof listed in the notes to the Financial Statements (as defined below) asof the close of business on the Closing Date (the “**Closing Date Schedule**”) and a statement (the“**Closing Statement**”) reflecting the calculation of any adjustment to the Purchase Price underSection 1.10(c), accompanied by a certificate of an officer of PII to the effect that suchstatement has been prepared in accordance with the terms of this Agreement. As used in thisAgreement, (i) “**Net Working Capital**” means the amount of combined Current Assets of the Companiesand their respective Subsidiaries *minus*the amount of combined Current Liabilities of the Companiesand their respective Subsidiaries; (ii) “**Current Assets**” means the sum of cash and cashequivalents, net trade receivables, net parts and supplies and prepaid and other current assets(excluding deferred mobilization costs on *Rig 321*); and (iii) “**Current Liabilities**” means the sumof accounts payable, accounts payable—affiliates, note payable—affiliates and accrued expensesand other current liabilities (excluding deferred mobilization revenues on *Rig 321*); in each caseas of the Closing Date and determined in accordance with generally accepted accounting principlesin the United States (“**GAAP**”) and consistent with the financial reporting policies and procedures used by the Sellers to preparethe combined balance sheet as of December 31, 2006 included in the Financial Statements; *provided,however,*that Current Assets and Current Liabilities shall not include Taxes payable, Taxesreceivable or deferred Taxes, as applicable. For the avoidance of doubt, Section 1.10(b) of theSeller Disclosure Letter sets forth the calculation of Net Working Capital as of December 31, 2006.The Buyer shall have a period of 45 calendar days after delivery of the Closing Date Schedule andthe Closing Statement to review (and cause Buyer’s auditors to review) such documents and make anyobjections it may have in writing to PII. During such 45-day period, Buyer and its independentauditors shall be permitted to review the working papers of PII’s
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independent auditors relating tothe Closing Date Schedule. If written objections are delivered to PII by the Buyer within such45-day period, then the Buyer and PII shall attempt to resolve the matter or matters in dispute.If no written objections are made by Buyer within such 45-day period, then such Closing DateSchedule and Closing Statement shall be final and binding on the parties. If disputes with respectto such Closing Date Schedule or such Closing Statement cannot be resolved by Buyer and PII within30 calendar days after timely delivery of any objections thereto, then, at the request of eitherBuyer or PII, the specific matters in dispute shall be submitted to Ernst & Young LLP or such otherindependent accounting firm as may be approved by PII and the Buyer (the “**Auditors**”), which firmshall render its opinion as to such specific matters. If no such referral is made within 45 daysafter the delivery of the objections, then such Closing Date Schedule and such Closing Statementshall be final and binding on the parties hereto. Based on such opinion, the Auditors will thensend to PII and the Buyer its determination of the specified matters in dispute, whichdetermination shall be final and binding on the parties hereto. Judgment may be entered upon thedetermination of the Auditors in any court having jurisdiction over the party against which suchdetermination is to be enforced. The fees and expenses of the Auditors shall be borne one-half bythe Sellers and one-half by the Buyer.          (c) If the Net Working Capital reflected on the Closing Date Schedule as finally determinedunder Section 1.10(b) is less than $208,191,916 (“**Base Net Working Capital**”), then within five daysfollowing the final determination thereof, PII will pay, or cause the applicable Seller to pay, tothe Buyer by wire transfer in immediately available funds to the account or accounts designated bythe Buyer the amount of such deficiency, plus interest thereon at 6% per annum, calculated on thebasis of the actual number of days elapsed divided by 365, from (and including) the Closing Date to(but excluding) the date of such payment. If the Net Working Capital reflected on the Closing DateSchedule is greater than Base Net Working Capital, then within five days following the finaldetermination thereof, the Buyer will pay to PII, for the account and as agent of the applicableSeller, by wire transfer in immediately available funds to the account or accounts designated byPII the amount of such excess, plus interest thereon at such interest rate from (and including) theClosing Date to (but excluding) the date of such payment.ARTICLE IIREPRESENTATIONS AND WARRANTIES OF THE SELLERS          Except as set forth in a letter to be delivered by the Sellers to the Buyer concurrently withthe execution and delivery of this Agreement (the “**Seller Disclosure Letter**”), the Sellers jointlyand severally represent and warrant to the Buyer as follows.          Section 2.1 *Organization; Etc*.          (a) Each Seller (i) is duly organized, validly existing and in good standing under the laws ofits jurisdiction of organization; (ii) has all requisite corporate or other entity power andauthority and possesses all governmental franchises, licenses, permits, authorizations andapprovals necessary to own, lease and operate its properties and assets, including the Shares ownedby such Seller, and to carry on its business substantially as it is now being conducted; and
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(iii)is duly qualified and in good standing to do business in each jurisdiction in which the nature ofits business or the ownership, operation or leasing of its properties makes such qualificationnecessary, except where the failure to be so organized, existing and in good standing, to have suchpower or authority or to be so qualified would not, individually or in the aggregate, adverselyaffect the ability of the Sellers to consummate the transactions contemplated by this Agreement.Each Seller has delivered or made available to the Buyer true and complete copies of its corporatecharter and bylaws (or equivalent governing documents), in each case as amended through the date ofthis Agreement.          (b) Each of the Companies and their respective Subsidiaries (i) is duly organized, validlyexisting and in good standing under the laws of its jurisdiction of organization; (ii) has allrequisite corporate or other entity power and authority and possesses all governmental franchises,licenses, permits, authorizations and approvals necessary to own, lease and operate its propertiesand assets and to carry on the Business conducted by such Company or Subsidiary substantially as itis now being so conducted; and (iii) is duly qualified and in good standing to do business in eachjurisdiction in which the conduct or nature of its business or the ownership, operation or leasingof its properties makes such qualification necessary, except where the failure to be so organized,existing and in good standing, to have such power and authority or to be so qualified would not,individually or in the aggregate, reasonably be expected to have a Business Material Adverse Effect(as defined below). The Sellers have delivered or made available to the Buyer true and completecopies of corporate charter and bylaws (or equivalent governing documents) of the Companies andtheir respective Subsidiaries, in each case as amended through the date of this Agreement. As usedin this Agreement, the term “**Business Material Adverse Effect**” means a material adverse change in,or effect on, the Business or the business, assets, financial condition or results of operations ofthe Companies and their respective Subsidiaries, taken as a whole; *provided*, *however*, that (1) anyadverse change or effect attributable to the announcement, pendency or consummation of thetransactions contemplated by this Agreement (including any cancellations of or delays in customerorders or other decreases in customer demand, any reduction in revenues, any disruption insupplier, distributor, customer, partner or similar relationships, work stoppages, any loss orthreatened loss of employees or other employee disruptions), (2) any adoption, implementation, promulgation,repeal, modification, reinterpretation or proposal of any rule, regulation, ordinance, order,protocol, practice or measure or any other Law of or by any government, governmental agency, court,commission, market administrator or similar organization or other such entity, (3) the bankruptcy,insolvency or other financial distress of any customers of any of the Companies or theirSubsidiaries, (4) changes or developments in financial or securities markets or the economy ingeneral, any outbreak, continuation or escalation of hostilities or the declaration by the UnitedStates or any Latin American country of a national emergency or war, any acts of terrorism, anyother calamity or crisis or geopolitical event, or effects of weather or meteorological events, (5)changes that are the result of factors generally affecting the principal industries and geographicareas in which the Companies and their Subsidiaries operate, except to the extent such changes havea disproportionate effect on the Business or the Companies and their respective Subsidiaries, takenas a whole, compared with other participants in such industries or geographical areas, (6) changesin the price of oil and natural gas, (7) any change in GAAP or in its interpretation or (8) anyactions taken at the Buyer’s request or contemplated by this Agreement, shall be excluded from suchdetermination. In addition to the foregoing, the determination of the dollar value or impact ofany change or event under the preceding sentence
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shall be based solely on the actual dollar valueof such change or effect, on a dollar-for-dollar basis, and shall not take into account (i) anymultiplier valuations, including any multiple based on earnings or other financial indicia, or (ii)any consequential damages or other consequential valuation.          Section 2.2 *Authority Relative to this Agreement*. Each Seller has the corporate power and authority to execute and deliver this Agreement and toconsummate the transactions contemplated by this Agreement. The execution and delivery of thisAgreement and the consummation of the transactions contemplated by this Agreement have been dulyand validly authorized by all requisite corporate action on the part of each of the Sellers. ThisAgreement has been duly and validly executed and delivered by each of the Sellers, and assumingthis Agreement has been duly authorized, executed and delivered by the Buyer, constitutes a validand binding agreement of each of the Sellers, enforceable against each of the Sellers in accordancewith its terms, except that (a) such enforcement may be subject to any bankruptcy, insolvency,reorganization, moratorium, fraudulent conveyance or transfer or other laws, now or hereafter ineffect, relating to or limiting creditors’ rights generally and (b) enforcement of this Agreement,including, among other things, the remedy of specific performance and injunctive and other forms ofequitable relief, may be subject to equitable defenses and to the discretion of the court beforewhich any proceeding therefor may be brought.          Section 2.3 *Capitalization*.          (a) Section 2.3(a) of the Seller Disclosure Letter sets forth the number of issued andoutstanding shares of capital stock of each Company and the record and beneficial owners of itsoutstanding capital stock as of the date hereof. All of such outstanding shares of capital stockof each Company are duly authorized, validly issued, fully paid and nonassessable. Except for theShares, there are not, and at the Closing there will not be, any capital stock orother equity interests in any Company issued, reserved for issuance or outstanding. Section2.3(a) of the Seller Disclosure Letter sets forth for each Subsidiary of a Company the amount ofits authorized capital stock, the amount of its outstanding capital stock and the record andbeneficial owners of its outstanding capital stock. Except as set forth in Section 2.3(a) of theSeller Disclosure Letter, there are no shares of capital stock or other equity securities of anysuch Subsidiary issued, reserved for issuance or outstanding. The Shares are duly authorized,validly issued, fully paid and nonassessable and not subject to or issued in violation of anypurchase option, call option, right of first refusal, preemptive right, subscription right or anysimilar right under any provision of applicable Law (as defined below), the corporate charter andbylaws (or equivalent governing documents) of any Company or any Contract to which any Company is aparty or otherwise bound. All the outstanding shares of capital stock of each Subsidiary of aCompany have been duly authorized and validly issued and are fully paid and nonassessable. Thereare no bonds, debentures, notes or other indebtedness of any Company having the right to vote (orconvertible into, or exchangeable for, securities having the right to vote) on any matters on whichholders of Shares may vote (“**Voting Company Debt**”). Except as set forth above, as of the date ofthis Agreement, there are not any options, warrants, rights, convertible or exchangeablesecurities, “phantom” stock rights, stock appreciation rights, stock-based performance units,commitments, Contracts, arrangements or undertakings of any kind to which any Company or any of itsSubsidiaries is a party or by which any of them is bound (i) obligating such Company or any suchSubsidiary to issue, deliver or sell, or cause to be issued, delivered or
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sold, additional sharesof capital stock or other equity interests in, or any security convertible or exercisable for orexchangeable into any capital stock of or other equity interest in, such Company or of any suchSubsidiary or any Voting Company Debt, (ii) obligating such Company or any such Subsidiary toissue, grant, extend or enter into any such option, warrant, call, right, security, commitment,Contract, arrangement or undertaking or (iii) giving any person the right to receive any economicbenefit or right similar to or derived from the economic benefits rights accruing to holders ofShares. As of the date of this Agreement, there are not any outstanding contractual obligations ofany Company or any of its Subsidiaries to repurchase, redeem or otherwise acquire any shares ofcapital stock of such Company or any such Subsidiary.          (b) Except for its interests in the Subsidiaries of the Companies and except for the ownershipinterests set forth in Section 2.3(b) of the Seller Disclosure Letter, no Company owns, directly orindirectly, any capital stock, membership interest, partnership interest, joint venture interest orother equity interest with a fair market value as of the date of this Agreement in excess of$50,000 in any person.          Section 2.4 *Ownership of Shares.*Immediately prior to the Closing, (a) PIL will have good and valid title to all the issued andoutstanding capital stock of PSAL and MC; (b) PIL and Jorge R. Postiglione, as third-party nomineeon behalf of PIL, will have good and valid title to 1,741,280 quotas and 470 quotas, respectively,of PISRL, representing all the issued and outstanding capital stock of PISRL; (c) PIL and PISRLwill have good and valid title to 1,541,311 capital quotas and 269 capital quotas, respectively, ofPIBL, representing all the issued and outstanding capital stock of PIBL; (d) Redfish and GOMPS willhave good and valid title to membership interests equaling 19,751,312.41 shares and one share,respectively, in PPSRL, representing all of the issued and outstanding capital stock of PPSRL; (e)PISRL and PSL will have good and valid title to 519,310shares and one share, respectively, of HAPSA, representing all the issued and outstanding capitalstock of HAPSA; (f) PISRL and PSL will have good and valid title to 188 shares and 212 shares,respectively, of PetroTech, representing all the issued and outstanding capital stock of PetroTech;and (g) PII will have good and valid title to all of the issued and outstanding capital stock ofTwin Oaks, in each case free and clear of all liens, pledges, charges, claims, security interestsor other encumbrances, whether consensual, statutory or otherwise (collectively, “**Liens**”). Theconsummation of the Purchase will convey to the Buyer good and valid title to the Shares, free andclear of all Liens, except for those created by the Buyer or arising out of ownership of the Sharesby the Buyer. Other than this Agreement, the Shares are not subject to any voting trust agreementor other Contract restricting or otherwise relating to the voting, dividend rights or dispositionof the Shares.          Section 2.5 *Contracts.*          (a) Section 2.5 of the Seller Disclosure Letter lists, as of the date of this Agreement, (i)all written agreements, commitments, contracts, leases, licenses, indentures, instruments and otherlegally binding arrangements (collectively, “**Contracts**”) to which any Company or any of itsSubsidiaries is a party and that (1) relate to the Business, (2) involve payments by or to anyCompany or any of its Subsidiaries of at least $1,000,000 over the original base term and (3) havean original base term (excluding potential renewals) extending at least 12 months; (ii) allContracts to which any Company or any of its Subsidiaries is a party involving payments by or toany Company or any such Subsidiary of at least $5,000,000 over the original
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base term, other thanContracts pursuant to which any Company or any of its Subsidiaries purchases goods or services inthe ordinary course of business; (iii) all Contracts relating to the borrowing of money by anyCompany or any of its Subsidiaries (other than intercompany accounts, which shall be governed bySection 1.9 of this Agreement) and guarantees by any Company or any of its Subsidiaries of anyobligation for the borrowing of money; (iv) all employment Contracts of any Company or any of itsSubsidiaries that have an aggregate future liability in excess of $100,000 and are not terminableby such Company or such Subsidiary by notice of not more than 90 days for a cost of less than$100,000; (v) all collective bargaining agreements and other Contracts of any Company or any of itsSubsidiaries with any labor organization, union or association; (vi) all Contracts under which anyCompany or any of its Subsidiaries has borrowed any money from, or issued any note, bond, debentureor other evidence of indebtedness to, any person (other than any Seller, any Company or any oftheir respective Subsidiaries) in any such case which, individually or in the aggregate, is inexcess of $1,000,000; and (vii) any Contract not otherwise required to be set forth in the SellerDisclosure Letter and under which the performance of any Company’s or any of its Subsidiaries’obligations or the consequences of a default or termination would reasonably be expected to have aBusiness Material Adverse Effect.          (b) To the knowledge of the Sellers, all Contracts required to be listed in Section 2.5 of theSeller Disclosure Letter (the “**Company Contracts**”) are valid, binding and in full force and effectand are enforceable by the applicable Company or Subsidiary thereof in accordance with their terms,except for such failures to be valid, binding, in full force and effect or enforceable that,individually or in the aggregate, would not reasonably be expected to have aBusiness Material Adverse Effect. The applicable Company or Subsidiary thereof has performedall material obligations required to be performed by it to date under the Company Contracts, and itis not (with or without the lapse of time or the giving of notice, or both) in breach or default inany material respect thereunder and, to the knowledge of the Sellers, no other party to any CompanyContract is (with or without the lapse of time or the giving of notice, or both) in breach ordefault in any material respect thereunder. None of the Sellers, the Companies or any of theSubsidiaries of the Companies has received any notice of the intention of any party to terminateany Company Contract. Complete and correct copies of all Company Contracts, together with allmodifications and amendments thereto, have been made available to the Buyer.          Section 2.6 *Consents and Approvals; No Violations*. Except for applicable requirements of the antitrust or competition laws set forth in Section 2.6of the Seller Disclosure Letter (the “**Antitrust Regulations**”), neither the execution and deliveryof this Agreement by any of the Sellers nor the consummation by any Seller of the transactionscontemplated by this Agreement will (a) conflict with or result in any breach of any provision ofcorporate charter, bylaws or equivalent governing documents of any Seller, any Company or anySubsidiary of a Company, (b) result in a violation or breach of, or constitute (with or without duenotice or lapse of time or both) a default (or give rise to any right of termination, cancellationor acceleration) under, or give rise to a loss of a material benefit under, or result in thecreation of any Lien upon the properties or assets of such Seller, Company or Subsidiary under, orrequire any consent under, any Contract to which any of the Sellers, any Company or any Subsidiaryof a Company is a party or by which any of them or any of their respective properties or assets arebound, (c) violate any law, order, judgment, writ, injunction, decree, statute, rule or regulation(collectively, “**Laws**” and, individually, a “**Law**”) that is currently in effect and applicable to anySeller, any
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Company, any Subsidiary of a Company or any of their respective properties or assets,or (d) require any filing, declaration or registration with, or the obtaining of any permit,authorization, license, order, consent or approval of, any Federal, state, local or foreigngovernment or any court of competent jurisdiction, administrative agency or commission or othergovernmental authority or instrumentality (“**Governmental Entity**”), except in the case of clauses(b), (c) and (d) of this Section 2.6 for any such violations, breaches, defaults, rights oftermination, cancellation or acceleration or requirements that, individually or in the aggregate,would not reasonably be expected to have a Business Material Adverse Effect and would not adverselyaffect the ability of the Sellers to consummate the transactions contemplated by this Agreement, orwhich become applicable as a result of the business or activities in which the Buyer is or proposesto be engaged or as a result of any acts or omissions by, or the status of or any facts pertainingto, the Buyer.          Section 2.7 *Financial Statements*. Section 2.7 of the Seller Disclosure Letter contains the audited combined balance sheets of theCompanies and the Subsidiaries listed therein as of December 31, 2006 and 2005 and the auditedcombined statement of operations, statement of owner’s net investment and statement of cash flowsof the Companies and the Subsidiaries listed therein for each of the years in the three-year periodended December 31, 2006, and the unaudited combined balance sheet as of June 30, 2007 and theunaudited combined statement of operations, statement of owner’s net investment and statement ofcash flows of the Companies and the Subsidiaries listed therein for the six-monthperiod ended June 30, 2007 (collectively, the “**Financial Statements**”). Except as disclosed in thenotes thereto, each of such balance sheets fairly presents in all material respects the combinedfinancial position of the Companies and the Subsidiaries as of the date thereof, and each of suchstatements of operations, owner’s net investment and cash flows fairly presents in all materialrespects the combined results of operations, owner’s net investment and cash flows of the Companiesand the Subsidiaries for the period indicated, all in accordance with GAAP consistently appliedthroughout the period indicated, except that the unaudited financial statements remain subject tonormal year-end adjustments and do not contain footnotes and similar disclosures otherwise requiredto be in conformity with GAAP. Except as set forth in Section 2.7 of the Seller Disclosure Letter,none of the Companies or their respective Subsidiaries has, since December 31, 2006, paid ordeclared (or taken any action in furtherance of or related to) any dividend or otherwise made anydistribution to its shareholders.          Section 2.8 *Absence of Undisclosed Liabilities*. Except for liabilities and obligations (a) incurred in the ordinary course of business andconsistent with past practice between December 31, 2006 and the Closing or (b) otherwise disclosedin the Seller Disclosure Letter or contemplated by this Agreement, at the Closing, none of theCompanies nor any of their respective Subsidiaries will have any liabilities or obligations(whether accrued, absolute, contingent, unasserted or otherwise) of a nature that would be requiredto be reflected or reserved against in a combined balance sheet of the Companies and suchSubsidiaries prepared in accordance with GAAP in excess of $10,000,000 in the aggregate.          Section 2.9 *Absence of Certain Changes*. Since December 31, 2006, (a) there have been no facts, changes or occurrences that, individuallyor in the aggregate, have had, or would reasonably be expected to have, a Business Material AdverseEffect, and (b) the Business has been conducted in the ordinary course consistent with pastpractice.
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          Section 2.10 *Litigation*. Section 2.10 of the Seller Disclosure Letter sets forth a list as of the date hereof of eachpending claim, action, suit, proceeding (“**Proceeding**”) or, to the knowledge of the Sellers,governmental investigation pending or, to the knowledge of the Sellers, threatened against anySeller, any Company or any Subsidiary of a Company by or before any Governmental Entity that (a)seeks damages, fines or penalties in excess of $100,000 for any individual Proceeding orgovernmental investigation or in excess of $500,000 in the aggregate for any related Proceedings orgovernmental investigations, (b) seeks any material injunctive relief or (c) relates to any of thetransactions contemplated by this Agreement. None of the Proceedings or governmentalinvestigations listed in Section 2.10 of the Seller Disclosure Letter would, if adverselydetermined, individually or in the aggregate, have a Business Material Adverse Effect or adverselyaffect the ability of the Sellers to consummate the transactions contemplated by this Agreement.None of the Sellers, the Companies or the Subsidiaries of the Companies is in default under orviolation of any outstanding injunction, judgment, order, decree, ruling or award that wouldreasonably be expected to have a Business Material Adverse Effect.          Section 2.11 *Compliance with Law*. The Business is being and has been conducted in compliance in all material respects with allapplicable Laws and all applicable orders, writs, injunctions and decrees of any GovernmentalEntity.          Section 2.12 *Employee Benefit Plans*.          (a) Section 2.12 of the Seller Disclosure Letter sets forth, as of the date of this Agreement,and the Sellers have delivered or made available to the Buyer true and complete copies of, alldeferred compensation, pension, profit-sharing and retirement plans and all material employment,bonus, retention bonus, success bonus, severance, change in control and other material employeebenefit plans, programs, arrangements and agreements maintained or with respect to whichcontributions are made by, any Company, or any such plans, programs, arrangements and agreements ofPII or any of its affiliates (other than the Companies and their Subsidiaries) under which any ofthe Companies may have any liability or obligation to contribute, or under which employees of anyof the Companies or their Subsidiaries hold or are entitled to receive compensation or benefits(collectively, the “**Plans**”).          (b) All Plans and their related trusts have been and are maintained in accordance with theirterms and in compliance with applicable Law in all material respects. None of the Companies ortheir Subsidiaries have any commitment or obligation to establish or adopt any new or additionalPlans or to increase the benefits under any existing Plan.          (c) None of any Company, any Subsidiary of any Company or any entity that is required to betreated as a single employer together with any Company or any Subsidiary of any Company underSection 414 of the Code sponsors, maintains or has any liability or obligation with respect to any“employee pension benefit plan” (within the meaning of Section 3(2) of the Employee RetirementIncome Security Act of 1974, as amended (“**ERISA**”)) subject to Title IV of ERISA or Section 412 ofthe Code that is reasonably likely to result in a material liability to any Company or any ofSubsidiary of a Company.
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          (d) Except as set forth in Section 2.12(d) of the Seller Disclosure Letter and except asrequired by applicable Law, no employee of any of the Companies or their Subsidiaries is entitledto any severance, separation, change of control, termination or bonus payment or other increased oradditional compensation or benefits as a result of any of the transactions contemplated by thisAgreement (alone or in combination with any other event) or in connection with the termination ofsuch employee’s employment on or after the Closing. The execution and delivery of this Agreementand the consummation of the transactions contemplated hereby and thereby (alone or in combinationwith any other event) and compliance by any of the Companies and any of their Subsidiaries with theprovisions hereof do not and will not require the funding of, or require an increase in the costof, or give rise to any other obligation of any Company or any of its Subsidiaries under, any Planand will not result in any breach or violation of, or default under, or limit any Company’s or anySubsidiary’s ability to amend, modify or terminate any Plan.          Section 2.13 *Employees; Labor and Employment Matters*. As of the date hereof, there are no (i) collective bargaining agreements or other laboragreements relating to any Company or any Subsidiary of any Company or covering any employee of anyCompany or any Subsidiary of any Company to which any Company or any Subsidiary of any Company is aparty or by which it is bound; (ii) unfair labor practice complaints against any Company or anySubsidiary of any Company pending (or, to the knowledge of the Sellers, threatened) before anyGovernmental Entity with respect to the Business; (iii) ongoing labor strikes, work stoppages orlockouts affecting any Company or any Subsidiary of any Company; (iv) material labor grievancespending against any Company or any Subsidiary of any Company; or (v) orders, judgments, writs,injunctions or decrees specifically applicable to any Company or any Subsidiary or, other thanemployment Contracts set forth in Section 2.5 of the Seller Disclosure Letter and customerContracts, Contracts to which any Company or any of the Subsidiaries is a party that in any waylimits or restricts the termination of any of their employees. The Companies and theirSubsidiaries are in compliance in all material respects with all applicable labor, housing,educational cooperation, unemployment insurance, health and safety, social security and relatedregulations.          Section 2.14 *Taxes.*          (a) With respect to each Company and its Subsidiaries, (i) all material returns, reports andforms with respect to Taxes (as defined in Section 4.7(j) of this Agreement) (collectively, “**TaxReturns**”) required to be filed on or before the Closing Date have been or will be timely filed inaccordance with any applicable Laws, (ii) all such Tax Returns as filed were complete and accuratein all material respects and (iii) all Taxes due on such Tax Returns have been or will be timelypaid in full or have been or will be reserved for on the balance sheets included in the FinancialStatements.          (b) With respect to each Company and its Subsidiaries, (i) there is no material action, suit,proceeding, audit, written claim or assessment pending or proposed with respect to Taxes or withrespect to any Tax Return, (ii) there are no waivers or extensions of any applicable statute oflimitations for the assessment or collection of Taxes with respect to any Tax Return that remain ineffect, (iii) there is full compliance in all material respects with all requirements for thewithholding and payment over of any Taxes required to be withheld and paid over with
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respect topayments to employees or other persons, (iv) there has not been a request made to change a methodof accounting for Tax purposes that would have an effect on the Taxes of the Company or itsSubsidiaries following the Closing, (v) the Companies and/ or their Subsidiaries have not extendedor waived the statute of limitations on any federal or any significant provincial Tax Return thatremains open at the date hereof, (vi) all Taxes which the Companies and or the Subsidiaries arerequired by Law to withhold or collect have been duly withheld or collected, and have been timelypaid over to the appropriate Governmental Entities to the extent due and payable, (vii) there is noinvestigation, examination or audit currently pending or threatened, regarding any Taxes relatingto the Companies and/ or their Subsidiaries, (viii) there is no request for rulings ordetermination letters with respect to the Companies and/ or their Subsidiaries, (ix) there are noTax sharing agreements or arrangements to which the Companies or the Subsidiaries are now a partyand (x) there are no material Liens for Taxes upon the assets of any Company or any Subsidiary of any Company, except for Liens for Taxes not yet due andpayable or Liens for Taxes being contested in good faith through appropriate proceedings.          (c) PII has treated, in its most recent filings with the U.S. Internal Revenue Service, eachof the Companies and its Subsidiaries as a corporation for U.S. federal tax purposes.          Section 2.15 *Title, Ownership and Related Matters*.          (a) Except for cash, accounts receivable and working capital items distributable by a Companyand its Subsidiaries pursuant to Section 1.10(a), each Company and its Subsidiaries have, free andclear of all Liens, other than Permitted Liens, good title to, or rights by license, lease or otheragreement to use, all material properties and assets (or rights thereto) primarily used or held foruse in the conduct of the Business as currently conducted. This Section 2.15(a) does not relate toreal property (which is subject to Section 2.15(b) below) or Rigs or E&P Equipment (which aresubject to Section 2.16). As used in this Agreement, “**Permitted Liens**” means (a) statutory Liensfor current Taxes not yet due and payable or being contested in good faith by appropriateproceedings; (b) mechanics’, carriers’, workers’, repairers’ and other similar Liens imposed byapplicable Law arising or incurred in the ordinary course of business consistent with pastpractices for obligations that are not overdue or that are being contested in good faith byappropriate proceedings; (c) other Liens that do not, and if foreclosed or otherwise executed wouldnot, materially interfere with the conduct of the Business; (d) Liens on leases of real propertyarising from the provisions of such leases, including any agreements and/or conditions imposed onthe issuance of land use permits, zoning, business licenses, use permits or other entitlements ofvarious types issued by any Governmental Entity, necessary or beneficial to the continued use andoccupancy of such real property or the continuation of the Business; (e) pledges or deposits madein the ordinary course of business consistent with past practices in connection with workers’compensation, unemployment insurance and other social security or similar legislation; (f) depositsto secure the performance of bids, contracts, leases, statutory obligations, surety and appealbonds, performance bonds and other obligations of a like nature incurred in the ordinary course ofbusiness consistent with past practices; (g) zoning regulations and restrictive covenants andeasements of record that do not detract in any material respect from the value of real property anddo not materially and adversely affect, impair or interfere with the use of any property affectedthereby; (h) public utility easements of record, in customary form, to serve real property; (i)landlords’ Liens in favor of landlords under the
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Leases; (j) mortgages, deeds of trust and othersecurity instruments, and ground leases or underlying leases covering the title, interest or estateof third-party landlords with respect to the real property subject to leases under which anyCompany leases real property and to which such leases are subordinate; (k) any other Liens,easements, rights-of-way, restrictions, rights, leases and other encumbrances affecting titlethereto, whether or not of record, which do not, and if foreclosed or otherwise executed would not,materially detract from the value of or materially interfere with the use and operation of theassets of the Companies and their Subsidiaries, taken as a whole; and (l) Liens, if any, created orpermitted to be imposed by the Buyer.          (b) Each of the Companies and their respective Subsidiaries has valid and marketable title toeach parcel of real property owned in fee by such Company or Subsidiary (the “**Owned Property**”),free and clear of all Liens other than Permitted Liens. Section 2.15(b) of the Seller DisclosureLetter sets forth a complete list of all leases, subleases and other agreements under which any ofthe Companies or their respective Subsidiaries uses or occupies or has the right to use or occupyany real property that involve lease payments in excess of $50,000 per month and are not terminableby such Company or Subsidiary that is a party thereto by notice of not more than 90 days (the“**Leases**”; the property governed by such Leases, together with the Owned Property, is referred toherein as the “**Real Property**”). Each of the Companies and their respective Subsidiaries has a goodand valid leasehold interest in each parcel of Real Property leased by it pursuant to the Leases,free and clear of all Liens other than Permitted Liens.          (c) The properties and assets owned, leased or used by the Companies and their Subsidiaries,together with the rights and services to be provided by PII or any of its affiliates to the Buyer,the Companies or any of their respective Subsidiaries under the Transition Services Agreement, willbe sufficient to conduct the Business immediately following the Closing in substantially the samemanner as currently conducted.          Section 2.16 *Rigs and E&P Equipment*.          (a) A listing of all the rigs owned or leased by the Companies and their Subsidiaries as ofthe date hereof (the “**Rigs**”), and for each Rig whether it is owned or leased and whether it hasoperated under contract at any time since July 1, 2006, is set forth in Section 2.16(a) of theSeller Disclosure Letter. The Companies or their Subsidiaries have good title to, or rights bylicense, lease or other agreement to use, the Rigs, free and clear of all Liens other thanPermitted Liens. The maintenance records related to the Rigs included in the “data room” preparedin connection with the transactions contemplated hereby are true and complete in all materialrespects as of the respective dates set forth therein. The Rigs in the aggregate are insufficiently good working order (ordinary wear and tear excepted) to conduct the Business ascurrently conducted. The Sellers have no plans for the retirement or material write-down in thevalue of any Rig. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION 2.16(a), NO OTHER WARRANTIES,EXPRESS OR IMPLIED, INCLUDING THOSE OF VALUE, PHYSICAL CONDITION, PERFORMANCE, MERCHANTABILITY ORFITNESS FOR A PARTICULAR PURPOSE, SHALL EXTEND TO THE RIGS.          (b) A true and complete listing of all material equipment used primarily in the E&P ServicesBusiness as of the date hereof is set forth in Section 2.16(b) of the Seller
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Disclosure Letter (the“**E&P Equipment**”). The E&P Equipment in the aggregate is in sufficiently good working order(ordinary wear and tear excepted) to conduct the Business as currently conducted. The Sellers haveno plans for the retirement or material write-down in the value of any E&P Equipment with areplacement value of greater than $500,000. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION 2.16(b),NO OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THOSE OF VALUE, PHYSICAL CONDITION,PERFORMANCE, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, SHALL EXTEND TO THE E&PEQUIPMENT.          Section 2.17 *Environmental Matters.*Except as have not had, and would not reasonably be expected to have, a Business MaterialAdverse Effect:     (a) The operations of the Companies and their Subsidiaries are and during the relevantstatute of limitations period have been in compliance with all applicable Environmental Lawsin the respective jurisdictions in which they operate;     (b) The Companies and their Subsidiaries have obtained and are in compliance with allpermits, licenses and other authorizations required under applicable Environmental Laws(“**Environmental Permits**”) for the continued operations of the Business, all EnvironmentalPermits are valid and in good standing, and none of the Companies nor any of theirrespective Subsidiaries has received notice of any actual or potential change in the statusor terms and conditions of any Environmental Permit;     (c) None of the Companies nor any of their respective Subsidiaries is subject to anyoutstanding orders, suits, demands, directives, claims, liens, investigations or proceedingsby any Governmental Entity or any person respecting (A) Environmental Laws, (B) RemedialAction or (C) any Release or threatened Release of, or exposure to, a Hazardous Substance(“**Environmental Claims**”) and, to the knowledge of the Sellers, no such Environmental Claimsare threatened;     (d) None of the Companies nor any of their respective Subsidiaries has received anywritten communication alleging, with respect to any such entity, a violation of or liabilityunder any Environmental Law; and     (e) There has been no Release or threatened Release of Hazardous Substances at anylocation that could reasonably be expected to (i) require any Remedial Action by any of theCompanies or their Subsidiaries pursuant to any Environmental Law or (ii) form the basis ofany Environmental Claim against any of the Companies or their Subsidiaries.     For purposes of this Agreement:     (A) “**Environment**” means (i) land, including surface land, sub-surface strata, sea bedand river bed under water (as defined in clause (ii)) and natural structures; (ii) water,including coastal and inland water, surface waters, and ground waters; (iii) air; and (iv)human health;
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     (B) “**Environmental Law**” means any Law, to the extent applicable to the person orproperties in the context of which the term is used, regulating or prohibiting Releases intoany part of the Environment, or pertaining to the protection of natural resources, theEnvironment or human health, as such laws have been and may be amended or supplemented;     (C) “**Hazardous Substance**” means petroleum or petroleum products, radioactive materialor wastes, asbestos in any form, urea formaldehyde foam insulation, polychlorinatedbiphenyls, and any other chemical, material, substance or waste that, in relevant form orconcentration, is prohibited, limited or regulated pursuant to Environmental Law;     (D) “**Release**” means any release, spill, effluent, emission, leaking, pumping,injection, deposit, disposal, discharge, dispersal, leaching or migration into or throughthe Environment, or at, into, onto, through or out of any property currently or formerlyowned, operated, leased or used by the applicable party; and     (E) “**Remedial Action**” means any and all actions to (i) clean up, remove, treat, or inany other way ameliorate or address any Hazardous Substances in the Environment; (ii)prevent the Release or threat of Release, or minimize the further Release, of any HazardousSubstance so it does not endanger or threaten to endanger human health or the Environment;or (iii) perform pre-remedial studies and investigations or post-remedial monitoring andcare pertaining or relating to a Release.          Section 2.18 *Insurance.*The Companies and their Subsidiaries maintain policies of fire and casualty, liability and otherforms of insurance in such amounts, with such deductibles and against such risks and losses as are,in the judgment of the Companies and their Subsidiaries, reasonable for the business and assets ofthe Companies and their Subsidiaries, when considered in conjunction with PII’s total businessoperations and self insurance practices. Section 2.18 of the Seller Disclosure Letter sets forth alist of all policies of insurance maintained, owned or held by the Sellers or their affiliates onthe date of this Agreement with respect to the Business, any Company, any Subsidiary of a Companyand their respective assets and properties. Except as would not reasonably be expected to have aBusiness Material Adverse Effect, all such policies are in full force and effect, all premiums dueand payable thereon have been paid (other than retroactive or retrospective premium adjustmentsthat are not yet, but may be, required to be paid with respect to any period ending prior to theClosing Date), and no notice of cancellation or termination has been received with respect to anysuch policy which has not been replaced on substantially similar terms prior to the date of suchcancellation. The Sellers shall keep or cause such insurance or comparable insurance to be kept infull force and effect through the Closing Date. The Sellers have complied in all material respectswith each of such insurance policies and have not failed to give any notice or present any claimthereunder in a due and timely manner.          Section 2.19 *Brokers; Finders and Fees*. Neither the Sellers nor any Company or Subsidiary of a Company has engaged any investmentbanker, agent, broker or finder in connection with this Agreement or the transactions contemplatedby this Agreement the fees of which will be paid by any Company or any of its Subsidiaries afterthe Closing or by the Buyer.
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Except as set forth in Section 2.19 of the Seller Disclosure Letter,none of the Sellers, any affiliate thereof, any Company or any Subsidiary thereof has agreed to payor cause to be paid to any employee, officer or director of the Sellers, any affiliate, any Companyor any Subsidiary thereof any fee or other amount in connection withthis Agreement or the transactions contemplated by this Agreement, other than any amounts solelypayable by the Sellers or any affiliate of the Sellers (other than the Companies and theirSubsidiaries).          Section 2.20 *Receivables*. The accounts receivable shown in the Financial Statements, subject to changes in the ordinarycourse of business from the date of the Financial Statements to the Closing Date, constitute all ofthe accounts receivable of the Business and represent bona fide sales actually made on or prior tosuch date in the ordinary course of the Business and consistent with past practice. Since June 30,2007, there have not been any material write-offs as uncollectible of any customer accountsreceivable of the Companies and their Subsidiaries, except for write-offs in the ordinary course ofthe Business and consistent with past practice.          Section 2.21 *Permits*. As of the date hereof, except as would not reasonably be expected to have a Business MaterialAdverse Effect: (i) each of the Companies and their respective Subsidiaries is in possession of allcertificates, licenses, permits, authorizations and approvals of any Governmental Entity requiredto conduct its business as currently conducted (the “**Permits**”) and such Company or Subsidiary hascomplied with the terms and conditions thereof; (ii) during the past three years, none of theSellers, the Companies and the Subsidiaries of any Company has received notice of any suit, actionor proceeding relating to the revocation or modification of any such Permits, and (iii) none of thePermits will be subject to suspension, modification, revocation or nonrenewal as a result of theexecution and delivery of this Agreement or the consummation of the transactions contemplated bythis Agreement. The Companies and their Subsidiaries possess all material Permits to own or holdunder lease and operate their respective assets and to conduct the Business as currently conducted.          Section 2.22 *Powers of Attorney; Officers and Directors*. Section 2.22 of the Seller Disclosure Letter sets forth as of the date hereof (i) a true andcorrect list of all powers of attorney granted by the Companies and their Subsidiaries sinceJanuary 1, 2002 and all persons authorized to act thereunder and (ii) a true and correct list ofall officers and directors of the Companies and their Subsidiaries.          Section 2.23 *Suppliers*. Between June 30, 2007 and the date of this Agreement, none of the Companies or theirSubsidiaries has entered into or made any Contract for the purchase of any material amount ofmerchandise other than in the ordinary course of business consistent with past practice. Exceptfor the suppliers named in Section 2.23 of the Seller Disclosure Letter, none of the Companies ortheir Subsidiaries has any supplier (other than the Sellers, their affiliates, another Company or aSubsidiary of a Company) from whom was purchased more than 5% of the total amount of goods andservices which were purchased by the Companies and their Subsidiaries, taken as a whole, during theyear ended December 31, 2006. Since June 30, 2007, none of the suppliers named in Section 2.23 ofthe Seller Disclosure Letter has delivered to any Company or any Subsidiary ofany Company written notice of cancellation or termination of its relationship with such Company orSubsidiary.
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          Section 2.24 *Customers*. Except for the customers named in Section 2.24 of the Seller Disclosure Letter, none of theCompanies or their Subsidiaries has any customer (other than another Company or a Subsidiary) towhom was made more than 5% of the total sales made by the Companies and their Subsidiaries, takenas a whole, during the year ended December 31, 2006. Since June 30, 2007, none of the customersnamed in Section 2.24 of the Seller Disclosure Letter has delivered to any Company or anySubsidiary of any Company written notice of cancellation or termination of its relationship withsuch Company or Subsidiary.          Section 2.25 *Intellectual Property*.          (a) Section 2.25(a) of the Seller Disclosure Letter sets forth a true and complete list of allmaterial patents (including all reissues, divisions, continuations and extensions thereof),published patent applications, trademark registrations, trademark applications, service markregistrations, service mark applications, registered trade names, registered business names,copyright registrations, and any license to any of the foregoing, but excluding the SellerTrademarks and Logos, owned, used, filed by or licensed to any Company or any Subsidiary andmaterial to the Business (collectively, “**Business Intellectual Property**”). To the knowledge of theSellers, the Business Intellectual Property and the Technology (as defined below) represent all thematerial intellectual property necessary for the operation of the Business. To the knowledge ofthe Sellers, (i) a Company or a Subsidiary of a Company is the sole and exclusive owner of, or theCompanies and their Subsidiaries have a valid and enforceable right to use, without payment to anyother person, all the Business Intellectual Property, and (ii) during the past three years, none ofthe Sellers, the Companies and the Subsidiaries has received any written or oral communication fromany person asserting any ownership interest in any Business Intellectual Property.          (b) None of the Sellers, the Companies and the Subsidiaries of the Companies has granted anylicense of any kind relating to any Business Intellectual Property or the marketing or distributionthereof. None of the Sellers, the Companies and such Subsidiaries is bound by or a party to anyoption, license or similar Contract relating to the Business Intellectual Property owned by anyother person for the use of such Business Intellectual Property in the conduct of the Business ofthe Companies and the Subsidiaries, except for so-called “shrink-wrap” license agreements relatingto computer software licensed to a Company or a Subsidiary in the ordinary course of business. Tothe knowledge of the Sellers, the conduct of the Business of the Companies and their Subsidiariesas presently conducted does not violate, conflict with or infringe in any material respect theintellectual property of any other person. (i) No claims are pending or, to the knowledge of theSellers, threatened, against any Company or any Subsidiary of a Company by any person with respectto the ownership, validity, enforceability, effectiveness or use in the Business of the Companiesand their Subsidiaries of any Business Intellectual Property and (ii) to the knowledge of theSellers, during the past three years none of the Sellers,the Companies and the Subsidiaries of the Companies has received any written or oralcommunication alleging that any Company or any such Subsidiary violated any rights relating tointellectual property of any person.          (c) To the knowledge of the Sellers, all trade secrets, confidential information, inventions,know-how, formulae, processes, procedures, research records, records of inventions, testinformation, market surveys and marketing know-how of the Companies and their
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Subsidiaries that ismaterial to the Business (the “**Technology**”) has been maintained in confidence in accordance withprotection procedures customarily used in the industry to protect rights of like importance.          Section 2.26 *Representations of the Sellers Refer to the Business*. Except as expressly set forth herein, all representations and warranties of the Sellers hereinrelate only to the Companies, their respective Subsidiaries, the Business and the employees of theBusiness and not to any other business, assets or employees of the Sellers.ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF BUYER          The Buyer hereby represents and warrants to each of the Sellers as follows:          Section 3.1 *Organization; Etc*. The Buyer (a) is a corporation duly organized, validly existing and in good standing under thelaws of Bermuda, (b) has all requisite corporate power and authority and possesses all governmentalfranchises, licenses, permits, authorizations and approvals necessary to own, lease and operate itsproperties and assets and to carry on its business substantially as now being conducted, and (c) isduly qualified and in good standing to do business in each jurisdiction in which the nature of itsbusiness or the ownership, operation or leasing of its properties makes such qualificationnecessary, except where the failure to be so organized, existing and in good standing, to have suchpower or authority or to be so qualified would not, individually or in the aggregate, have a BuyerMaterial Adverse Effect (as defined below). As used in this Agreement, the term “**Buyer MaterialAdverse Effect**” shall mean an event, change or circumstance that would adversely affect the abilityof the Buyer to consummate the transactions contemplated by this Agreement. The Buyer hasdelivered or made available to the Sellers true and complete copies of its corporate charter andbylaws (or equivalent governing documents), in each case as amended through the date of thisAgreement.          Section 3.2 *Authority Relative to this Agreement*. The Buyer has the corporate power and authority to execute and deliver this Agreement and toconsummate the transactions contemplated by this Agreement. The execution and delivery of thisAgreement and the consummation of the transactions contemplated by this Agreement have been dulyand validly authorized by all requisite corporate action on the part of the Buyer. This Agreementhas been duly and validly executed and delivered by the Buyer and, assuming this Agreement has beenduly authorized, executed and delivered by the Sellers, constitutes a validand binding agreement of the Buyer, enforceable against the Buyer in accordance with its terms,except that (a) such enforcement may be subject to any bankruptcy, insolvency, reorganization,moratorium, fraudulent conveyance or transfer or other laws, now or hereafter in effect, relatingto or limiting creditors’ rights generally and (b) enforcement of this Agreement, including, amongother things, the remedy of specific performance and injunctive and other forms of equitablerelief, may be subject to equitable defenses and to the discretion of the court before which anyproceeding therefor may be brought.          Section 3.3 *Consents and Approvals; No Violations*. Except for applicable requirements of Antitrust Regulations, neither the execution and deliveryof this Agreement by
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the Buyer nor the consummation by the Buyer of the transactions contemplatedby this Agreement will (a) conflict with or result in any breach of any provision of the corporatecharter, bylaws or equivalent governing documents of the Buyer or any of its Subsidiaries, (b)result in a violation or breach of, or constitute (with or without due notice or lapse of time orboth) a default (or give rise to any right of termination, cancellation or acceleration) under, orgive rise to a loss of a material benefit under, or result in the creation of any Lien upon theproperties or assets of the Buyer or any of its Subsidiaries under, or require any consent under,any Contract to which the Buyer or any of its Subsidiaries is a party or by which any of them orany of their respective properties or assets are bound, (c) violate any Laws applicable to theBuyer, any of its Subsidiaries or any of their respective properties or assets, or (d) require anyfiling, declaration or registration with, or the obtaining of any permit, authorization, license,order, consent or approval of, any Governmental Entity, except in the case of clauses (b), (c) and(d) of this Section 3.3 for any such violations, breaches, defaults, rights of termination,cancellation or acceleration or requirements that, individually or in the aggregate, would not havea Buyer Material Adverse Effect, or that become applicable as a result of the business oractivities in which the Sellers are or propose to be engaged or as a result of any acts oromissions by, or the status of or any facts pertaining to, the Sellers.          Section 3.4 *Acquisition of Shares for Investment*. The Buyer is acquiring the Shares for investment and not with a view toward, or for sale inconnection with, any public distribution thereof, nor with any present intention of distributing orselling such Shares. The Buyer agrees that the Shares may not be sold, transferred, offered forsale, pledged, hypothecated or otherwise disposed of without registration under the Securities Actof 1933, as amended, and any applicable state securities laws, except under an exemption from suchregistration under such Act and such laws.          Section 3.5 *Availability of Funds*. The Buyer has delivered to the Sellers true and complete copies of an executed debt commitmentletter from Citigroup Global Markets Inc. (the “**Financing Commitment**”), pursuant to which CitigroupGlobal Markets Inc. has agreed to provide or cause to be provided an aggregate of $600,000,000 atClosing (the “**Financing**”). The commitments contained in the Financing Commitment have not beenwithdrawn or rescinded in any respect as of the date of this Agreement. As of the date of thisAgreement, no event has occurred which, with or without notice, lapse of time or both, wouldconstitute a default or breach on the part of the Buyer or itsaffiliates under any term or condition of the Financing Commitment. There are no conditionsprecedent relating to the funding of the full amount of the Financing, other than as set forth inthe Financing Commitment. As of the date of this Agreement, the Buyer has no reason to believethat any of the conditions relating to the funding of the full amount of the Financing will not besatisfied on or prior to the Closing Date. At the Closing, the Financing, together with theBuyer’s immediately available funds, in cash, will be sufficient to provide the Companies and theirrespective Subsidiaries with sufficient working capital and to pay any other amounts payable underthis Agreement and to effect the transactions contemplated by this Agreement, all without anythird-party consent or approval required.          Section 3.6 *Litigation*. There is no Proceeding or, to the knowledge of the Buyer, governmental investigation pending or,to the knowledge of the Buyer, threatened against
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the Buyer or any of its Subsidiaries by or beforeany Governmental Entity that, individually or in the aggregate, would have a Buyer Material AdverseEffect.          Section 3.7 *Balance Sheet*. The Buyer has delivered to the Sellers true and complete copies of the audited consolidatedbalance sheets of the Buyer and its Subsidiaries as of December 31, 2006 and 2005. Except asdisclosed in the notes thereto, each of such balance sheets fairly presents in all materialrespects the consolidated financial position of the Buyer and its Subsidiaries as of the datethereof, all in accordance with GAAP consistently applied throughout the period indicated.          Section 3.8 *Investigation by the Buyer; No Reliance; Sellers’ Liability*. The Buyer has conducted its own independent review and analysis of the business and prospects ofthe Companies, their respective Subsidiaries and the Business. In entering into this Agreement,the Buyer has relied solely upon its own investigation and analysis and the specificrepresentations and warranties of the Sellers set forth in Article II of this Agreement, and theBuyer:     (a) acknowledges and agrees that it has not been induced by and has not relied upon anyrepresentations, warranties or statements, whether express or implied, made by the Sellersor any of their respective directors, officers, shareholders, employees, affiliates,controlling persons, agents, advisors or representatives that are not expressly set forth inArticle II of this Agreement, whether or not any such representations, warranties orstatements were made in writing or orally;     (b) acknowledges and agrees that none of the Sellers, the Companies or any of theirrespective directors, officers, shareholders, employees, affiliates, controlling persons,agents, advisors or representatives makes or has made any representation or warranty, eitherexpress or implied, as to the accuracy or completeness of any of the information provided ormade available to the Buyer or its directors, officers, employees, affiliates, controllingpersons, agents or representatives, including any information, document, or materialprovided or made available, or statements made, to the Buyer (including its directors,officers, employees, affiliates, controlling persons, advisors,agents or representatives) in “data rooms,” management presentations or supplementaldue diligence information provided to the Buyer (including its directors, officers,employees, affiliates, controlling persons, advisors, agents or representatives) inconnection with discussions or access to management of the Business or in any other form inexpectation of the transactions contemplated by this Agreement (collectively, “**Due DiligenceInformation**”);     (c) acknowledges and agrees that (i) the Due Diligence Information includes certainprojections, estimates and other forecasts, and certain business plan information, (ii)there are uncertainties inherent in attempting to make such projections, estimates and otherforecasts and plans and the Buyer is familiar with such uncertainties, and (iii) the Buyeris taking full responsibility for making its own evaluation of the adequacy and accuracy ofall projections, estimates and other forecasts and plans so furnished to it and any use ofor reliance by the Buyer on such projections, estimates and other forecasts and plans shallbe at its sole risk; and
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     (d) agrees, to the fullest extent permitted by law, that none of the Sellers, theCompanies or any of their respective directors, officers, shareholders, employees,affiliates, controlling persons, agents, advisors or representatives shall have anyliability or responsibility whatsoever to the Buyer or its directors, officers,shareholders, employees, affiliates, controlling persons, agents, advisors orrepresentatives on any basis (including in contract or tort, under federal or statesecurities laws or otherwise) resulting from the distribution to the Buyer, or the Buyer’suse of, any Due Diligence Information, except that the foregoing limitations shall not applyto the extent the Sellers make the specific representations and warranties set forth inArticle II of this Agreement, but always subject to the limitations and restrictionscontained in this Agreement.          Section 3.9 *Brokers; Finders and Fees*. Neither the Buyer nor any of its affiliates has engaged any investmentbanker, agent, broker or finder in connection with this Agreement or the transactions contemplatedby this Agreement the fees of which will be paid by any Seller, any Company or any of theirrespective Subsidiaries.ARTICLE IVCOVENANTS OF THE PARTIES          Section 4.1 *Conduct of Business*. During the period from the date of this Agreement to the Closing Date, exceptas otherwise contemplated by this Agreement or set forth in Section 4.1 of the Seller DisclosureLetter or the transactions contemplated by this Agreement or consented to by the Buyer in writing,which consent shall not be unreasonably withheld, the Sellers shall and shall cause each of theCompanies and their respective Subsidiaries:          (a) to use its commercially reasonable efforts to conduct the Business in the ordinary courseconsistent with past practice and, to the extent consistent therewith, use all commerciallyreasonable efforts to keep intact their respective businesses, keep available the services of theircurrent employees and preserve their relationships with customers, suppliers, licensors, licensees,distributors and others with whom they deal; and          (b) not to:          (i) in the case of the Companies and their respective Subsidiaries only, amend itscertificate of incorporation or by-laws;          (ii) sell, transfer, lease or otherwise dispose of any properties or assets material tothe Business, except obsolete or excess equipment sold in the ordinary course of businessand consistent with past practice;          (iii) in the case of the Companies and their respective Subsidiaries only, make or payany loans, advances (other than advances in the ordinary course of business or advances tothe Sellers, the Companies or any of their respectiveSubsidiaries) or capital contributions to, or investments in, any other person (otherthan the Companies or any of their respective Subsidiaries);
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          (iv) terminate or materially amend any Contracts material to the Business, except inthe ordinary course of business and consistent with past practice;          (v) enter into any new Contract material to the Business other than drilling orworkover Contracts, customer Contracts, service Contracts, product purchase Contracts orrenewals of existing Contracts, in each case in the ordinary course of business, orotherwise in the ordinary course of business;          (vi) in the case of the Companies and their respective Subsidiaries only, enter intoany written employment agreement with any employee or increase in any manner thecompensation of any of the officers or other employees of any Company or any of itsSubsidiaries, except for such increases as are required by applicable Law, rule orregulation or are granted in the ordinary course of business consistent with past practices(which shall include normal periodic performance reviews and related compensation andbenefit increases);          (vii) in the case of the Companies and their respective Subsidiaries only, adopt,grant, amend, extend or increase the rate or terms of any bonus, insurance, pension or otheremployee benefit plan, payment or arrangement made to, for or with any such officers oremployees of any Company or any of its Subsidiaries, except, in each case, for increasesrequired by any applicable Law, rule or regulation and except increases in the ordinarycourse of business consistent with past practice;          (viii) in the case of the Companies and the Subsidiaries only, make any change in anyof their respective present accounting methods and practices, except as required by changesin GAAP;          (ix) in the case of the Companies and their respective Subsidiaries only, incur orassume any liabilities, obligations or indebtedness for borrowed money, issue any debtsecurities or assume, guarantee or endorse any such liabilities, obligations or indebtednessof any persons other than in the ordinary course of business and consistent with pastpractice; *provided, however*, that in no event shall any Company or any of its Subsidiariesincur or assume any long-term indebtedness for borrowed money;          (x) in the case of the Companies and their respective Subsidiaries only, (x) declare orpay any dividend or make any other distribution to its stockholders, whether or not upon orin respect of any shares of its capital stock, (y) redeem or otherwise acquire any shares ofits capital stock or (z) issue any capital stock or any option, warrant or right relatingthereto or any securities convertible into or exchangeable for any shares of capital stock,in each case except as contemplated by Section 1.9 or Section 1.10(a) and dividends,distributions, redemptions, acquisitions and issuances solely involving the Companies andtheir Subsidiaries;          (xi) in the case of the Companies and their respective Subsidiaries only, permit, allowor suffer any of its material assets to become subjected to any Lien other than a PermittedLien;
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          (xii) in the case of the Companies and their respective Subsidiaries only, cancel anymaterial indebtedness (individually or in the aggregate) or waive any claims or rights ofsubstantial value;          (xiii) in the case of the Companies only, materially defer maintenance and othercapital expenditures;          (xiv) in the case of the Companies and their respective Subsidiaries only, enter intoany lease of real property involving lease payments in excess of $10,000 per month, exceptany renewals of existing leases in the ordinary course of business consistent with pastpractice;          (xv) in the case of the Companies and their respective Subsidiaries only, acquire bymerging or consolidating with, or by purchasing a substantial portion of the assets of, orby any other manner, any business or any corporation, partnership, association or otherbusiness organization or division thereof or, except in the ordinary course of businessconsistent with past practice, otherwise acquire any assets (other than inventory) that arematerial;          (xvi) take any action (other than matters outside of the control of the Sellers and theCompanies) that would result in (a) any of the conditions set forth in Section 5.3(a) and(b) not to be satisfied or (b) any of the representations and warranties of the Sellersbecoming untrue or incorrect in any material respect; or          (xvii) authorize any of, or commit or agree to take, whether in writing or otherwise,to do any of, the foregoing actions.          Section 4.2 *Access to Information; Confidentiality*.          (a) From the date of this Agreement to the Closing, except for any information that is subjectto attorney-client privilege or other privilege from disclosure or subject to a confidentialityagreement with a third party, the Sellers will and will cause the Companies to (i) give the Buyerand its authorized representatives access to all books, records, personnel, accountants, officesand other facilities and properties of the Companies and their respective Subsidiaries or otherwiserelating to the Business, (ii) permit the Buyer to make such copies and inspections thereof as theBuyer may reasonably request, and (iii) cause the Sellers’ and Companies’ officers, as applicable,to furnish the Buyer with such financial and operating data and other information with respect tothe Business as the Buyer may from time to time reasonably request; *provided, however*, that anysuch access shall be conducted at the Buyer’s risk and expense, at a reasonable time, under thesupervision of the Sellers’ or the Companies’ personnel and in such a manner as to maintain theconfidentiality of this Agreement and thetransactions contemplated by this Agreement and not to interfere unreasonably with theoperation of the businesses of the Sellers, the Companies or any of their respective Subsidiaries.          (b) All such information and access shall be subject to the terms and conditions of theConfidentiality Agreement between the Buyer and PII dated April 23, 2007 (the “**ConfidentialityAgreement**”). Notwithstanding anything to the contrary contained in this Agreement, none of theSellers, the Companies or any of their affiliates will have any obligation
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to make available or provide to the Buyer or its representatives a copy of any consolidated, combined or unitary TaxReturn filed by the Sellers or any of their affiliates (excluding the Companies), or any relatedmaterial.          (c) From and after the Closing, the Buyer will and will cause the Companies and theirSubsidiaries to (i) give the Sellers and their authorized representatives reasonable access to allbooks, records, personnel, accountants, offices and other facilities and properties of theCompanies and their respective Subsidiaries or otherwise relating to the Business, (ii) permit theSellers to make such copies and inspections thereof as the Sellers may reasonably request, and(iii) cause the Buyer’s and the Companies’ officers, as applicable, to furnish the Sellers withsuch financial and operating data and other information with respect to the Business as the Buyermay from time to time reasonably request, in each case (A) to comply with reporting, disclosure,filing or other requirements imposed on the Sellers (including under applicable securities Laws) bya Governmental Entity having jurisdiction over the Sellers, (B) for use in any Proceeding or inorder to satisfy audit, accounting, claims, regulatory, litigation, subpoena or other similarrequirements or (C) to comply with the obligations of the Sellers under this Agreement or theTransition Services Agreement, as the case may be; *provided, however*, that in the event that theBuyer determines that any such provision of access or information could be commerciallydetrimental, violate any Law or agreement, or waive any attorney-client privilege, the partiesshall take all reasonable measures to permit the compliance with such obligations in a manner thatavoids any such harm or consequence.          (d) The Sellers acknowledge that, subsequent to the Closing, they may be furnished with,receive or otherwise have access to, proprietary information of the Buyer, the Companies or theirSubsidiaries (collectively, “**Buyer Proprietary Information**”). Subsequent to the Closing, theSellers shall not disclose, and shall maintain the confidentiality of, all Buyer ProprietaryInformation. The Sellers shall use at least the same degree of care to safeguard and to preventthe disclosure, publication, dissemination, destruction, loss or alteration of the BuyerProprietary Information as they employ to avoid unauthorized disclosure, publication,dissemination, destruction, loss or alteration of their own information (or information of itscustomers) of a similar nature, but in no case less than reasonable care. Except as expresslyprovided herein, the Sellers shall not (A) use any Buyer Proprietary Information in any manner, (B)make any copies of any Buyer Proprietary Information, (C) acquire any right in or assert any Lienagainst any Buyer Proprietary Information, (D) sell, assign, transfer, lease, license or otherwisedispose of any Buyer Proprietary Information to third parties or commercially exploit any BuyerProprietary Information, including through derivative works, or (E) refuse for any reason(including a default or breach of this Agreement by Buyer) to promptly provide any tangibleembodiments of the Buyer Proprietary Information (including copies thereof) to Buyer if requestedto do so, in the form reasonably requested. Except as may otherwise be provided in Section 4.2(c)or Section 4.7, none of the Buyer, the Companies and their Subsidiaries or any oftheir affiliates shall be obligated to disclose any Buyer Proprietary Information to theSellers, and nothing contained in this Agreement shall be construed as granting to or conferring onthe Sellers, expressly or impliedly, any right, title, interest or license to any Buyer ProprietaryInformation or any components thereof.          (e) It is understood that the Sellers shall not have any liability or obligation hereunderwith respect to any Buyer Proprietary Information that (i) at the time of disclosure or
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thereafter is generally available to and known by the public (other than as a result of a disclosure or otheract or omission by the Sellers or any of their affiliates or any of their respectiverepresentatives after the Closing), or (ii) the Sellers or any of their affiliates or any of theirrespective representatives are legally required (by deposition, interrogatory, request fordocuments, subpoena, civil investigative demand or similar process or by Law, governmentalProceeding, stock exchange rule or court order) to disclose. In the event that the Sellers or anyof their affiliates or their representatives are requested or legally required (by deposition,interrogatory, request for documents, subpoena, civil investigative demand or similar process or byLaw, governmental Proceeding, stock exchange rule or court order) to disclose any of the BuyerProprietary Information, the Sellers shall provide the Buyer with prompt written notice of suchrequest or requirement (together with a copy of the material proposed to be disclosed) prior to anydisclosure thereof, and the Sellers shall cooperate with the Buyer so that the Buyer may seek aprotective order or other appropriate remedy or, if it so elects, waive compliance with thisSection 4.2. In the event that such protective order or other remedy is not obtained, or the Buyerwaives compliance with the provisions hereof, the Sellers or any of their affiliates or theirrepresentatives, as the case may be, may disclose only that portion of the Buyer ProprietaryInformation that is legally required to be disclosed, *provided*that the Buyer has been given areasonable opportunity to review the specifics of such disclosure before it is made. The Sellersshall exercise all reasonable efforts to obtain assurance that confidential treatment will beaccorded the information so disclosed. Nothing provided in this Section 4.2 shall limit PII fromdisclosing financial and other information with respect to the Companies or the Business insatisfaction of its obligations as a publicly traded, exchange-listed company.          (f) The Sellers will promptly request all persons who have heretofore executed aconfidentiality agreement in connection with such persons’ consideration of acquiring, directly orindirectly, the Business to return or destroy all confidential information heretofore furnished tosuch persons by or on behalf of the Sellers, or any affiliate thereof, and will, or will cause anyaffiliate a party thereto to, enforce all obligations of such persons and all rights and remediesof the Sellers or such affiliate under such confidentiality agreements.     Section 4.3 *Consents; Cooperation*.          (a) Each of the Sellers and the Buyer shall cooperate, and use its commercially reasonableefforts, to make all filings and obtain all licenses, permits, consents, approvals, authorizations,qualifications and orders of Governmental Entities and other third parties necessary in connectionwith the transactions contemplated by this Agreement.          (b) The Sellers and the Buyer shall file with any applicable Governmental Entity, all filings,reports, information and documentation required in connection with the consummation of thetransactions contemplated by this Agreement. The Sellers and the Buyer shall furnish to eachother’s counsel such necessary information and reasonable assistance as the other party may requestin connection with its preparation of any such filing or submission. The Sellers and the Buyershall consult with each other as to the appropriate time of making such filings and submissions andshall use commercially reasonable efforts to make such filings and submissions at the agreed upontime in observance of any requirements as to time of filing under applicable Law. The Sellers andthe Buyer acknowledge and agree that, within seven days after the Closing, they will each file withthe applicable Argentine Governmental Entities the filings
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required under the Argentine Antitrust Regulations. Each of the Sellers and the Buyer shall furnishto the other such necessary information and reasonable assistance as the other may request in orderto effect such filings in a timely manner.          (c) The Sellers and the Buyer shall keep each other apprised of the status of anycommunications with, and any inquiries or requests for additional information from, GovernmentalEntities and shall comply promptly with any such inquiry or request.          (d) The Sellers and the Buyer shall use their commercially reasonable efforts to vigorouslydefend, lift, mitigate and rescind the effect of any litigation or administrative proceedingadversely affecting this Agreement or the transactions contemplated by this Agreement, includingpromptly appealing any adverse court or administrative order or injunction.          (e) Notwithstanding the foregoing, prior to the Closing, without the prior written consent ofPII, the Buyer shall not, and shall cause its affiliates not to, make any filing with, or seek toobtain any license, permit, consent, approval, authorization, qualification or order of, anyGovernmental Entity in connection with the transactions contemplated hereby.          Section 4.4 *Consultation*. In connection with the continuing operation of the Business between the date of thisAgreement and the Closing, the Sellers shall use commercially reasonable efforts to consult withthe representatives for the Buyer, as may from time to time be reasonably requested by the Buyer,to report material operational developments and the general status of ongoing operations pursuantto procedures reasonably requested by Buyer or such representatives. The Sellers acknowledge thatany such consultation shall not constitute a waiver by the Buyer of any rights it may have underthis Agreement, and that Buyer shall not have any liability or responsibility for any actions ofany Seller or any of their respective officers or directors with respect to matters that are thesubject of such consultations unless Buyer expressly consents to such action in writing.          Section 4.5 *Commercially Reasonable Efforts*. Each of the Sellers and the Buyer shall cooperate, and use itscommercially reasonable efforts to take, or cause to be taken, all reasonable action, and to do, orcause to be done, all things reasonably necessary, proper or advisable under applicable Laws toconsummate the transactions contemplated by this Agreement. The Buyer shall not take any action(other than matters outside ofthe control of the Buyer) that would result in (a) any of the conditions set forth in Section5.2(a) and (b) not to be satisfied or (b) any of the representations and warranties of the Buyerbecoming untrue or incorrect in any material respect.          Section 4.6 *Public Announcements*. Prior to but not after the Closing, except as set forth herein or otherwiseagreed to by the parties, the parties shall not issue any report, statement or press release orotherwise make any public statements with respect to this Agreement or the transactionscontemplated by this Agreement, except as in the reasonable judgment of the party may be requiredby Law or in connection with its obligations as a publicly-held, exchange-listed company, in whichcase the parties will consult with each other as to the language of any such report, statement orpress release.
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          Section 4.7 *Tax Matters*.          (a) *Indemnification*.          (i) *Sellers’ Indemnification of the Buyer.*The Sellers shall jointly and severallyindemnify the Buyer against (i) any Taxes imposed on any Company or any of its Subsidiarieswith respect to any taxable period, or portion thereof, ending on or before the ClosingDate, including Taxes payable in connection with the Proceedings listed in Section 2.10 andSection 2.14 of the Seller Disclosure Letter, (ii) any Taxes that may be imposed on anyCompany or any of its Subsidiaries as a result of being a member of a consolidated,combined, unitary or similar group of corporations or other taxpayers at any time prior tothe Closing, and (iii) any Taxes of any other person that may be imposed upon any Company orany of its Subsidiaries as a result of being a successor to such other person for Taxpurposes prior to the Closing or as a result of any Company or any of its Subsidiaries beinga party to a Tax sharing, Tax allocation or similar agreement prior to the Closing, but, ineach case, not including (A) any Transfer Taxes for which the Buyer is liable under Section4.7(e) of this Agreement and (B) any Taxes, or portions thereof, resulting from a change inLaw occurring after the Closing Date.          (ii) *Buyer’s Indemnification of the Sellers.*The Buyer shall indemnify the Sellersfrom, against and in respect of any liability of the Sellers or their respectiveSubsidiaries for (i) any Taxes imposed on any Company or any of its Subsidiaries withrespect to any taxable period, or portion thereof, beginning after the Closing Date, (ii)any Taxes that may be imposed on any Company or any of its Subsidiaries as a result of beinga member of a consolidated, combined, unitary or similar group of corporations or othertaxpayers at any time after the Closing, (iii) any Taxes of any other person that may beimposed upon any Company or any of its Subsidiaries as a result of being a successor to suchother person for Tax purposes after the Closing or as a result of any Company or any of itsSubsidiaries being a party to a Tax sharing, Tax allocation or similar agreement after theClosing, (iv) any Transfer Taxes for which the Buyer is liable under Section4.7(e) of this Agreement, (v) any Taxes, or portions thereof, resulting from a changein Law occurring after the Closing Date and imposed on any Company or any of itsSubsidiaries with respect to any taxable period, or portion thereof, ending on or before theClosing Date and (vi) any Tax liability resulting from an election by the Buyer underSection 338 of the Code.          (iii) *Section 338 and Similar Elections.*Not later than 30 business days after theClosing Date Schedule and Closing Statement become final and binding on the parties pursuantto Section 1.10(b) of this Agreement, the Sellers shall deliver to the Buyer a schedule (the“**Section 338 Schedule**”) of the estimated Foreign Tax Credit Loss Amount with respect to eachCompany and each of its direct and indirect subsidiaries eligible to make an election underSection 338(g) of the Code with respect to the purchase or deemed purchase of its shares (ineach case, a “**Target**”). The “**Foreign Tax Credit Loss Amount**” with respect to any Targetshall be equal to the excess of (A) the foreign income taxes that would have been deemedpaid by PII and its subsidiaries under Section 902 of the Code (whether by reason ofSections 301, 367(b), 960, 964(e) or 1248 or other relevant provisions of the Code) as aresult of the transactions contemplated by Section 1.1 of this Agreement or dividends paidby PII’s subsidiaries in the taxable year that includes the Closing Date had no suchelection been made with respect to the purchase of shares of Target over (B) the foreignincome taxes that will be deemed paid by PII and its subsidiaries under Section 902 of theCode (whether by reason of Sections 301, 367(b), 960, 964(e) or 1248 or other relevantprovisions of the Code) as a result of the transactions contemplated by
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Section 1.1 of thisAgreement or dividends paid by PII’s subsidiaries in the taxable year that includes theClosing Date taking into account such election made by Buyer. The Sellers shall alsoinclude on the Section 338 Schedule an estimate of the taxable periods in which each portionof the lost tax benefit corresponding to the aggregate Foreign Tax Credit Loss Amount withrespect to all Targets that would have been realized by PII and its subsidiaries had noelection under Section 338(g) of the Code been made with respect to any Target. Not laterthan 5 business days after the Buyer or any of its affiliates has made an election underSection 338(g) of the Code with respect to any Target (an “**Electing Target**”), the Buyershall notify the Sellers of such election. The Buyer shall pay to PII, for the account andas agent of each of the Sellers, that portion of the lost tax benefit corresponding to theaggregate Foreign Tax Credit Loss Amount with respect to all Electing Targets that wouldhave been realized by PII and its subsidiaries in each taxable period had no elections underSection 338(g) of the Code been made with respect to the Electing Targets. The payment withrespect to each taxable period shall be due within 30 business days after PII notifies theBuyer of the amount with respect to such taxable period, but in no case earlier than thedate that PII or its successor files the federal income tax return for such taxable period.If as a result of an adjustment in a Tax Audit (as defined below) or an amended Tax Returnthe amounts otherwise computed above would be different, then the Buyer and PII will makepayments between them to reflect the consequences of such adjustment.          (b) *Allocation of Taxes and Earnings and Profits*. To the extent permitted by Law oradministrative practice, the taxable years of the Companies and their Subsidiaries shall end at theclose of business on the Closing Date. Whenever it is necessary to determine the liability forTaxes, or the earnings and profits, of any Company or any of its Subsidiaries for aportion of a taxable year or period that begins before and ends after the Closing Date, thedetermination of the Taxes or the earnings and profits for the portion of the year or period endingon, and the portion of the year or period beginning after, the Closing Date shall be determined byassuming that the taxable year or period ended at the close of business on the Closing Date, exceptthat (A) exemptions, allowances or deductions that are calculated on an annual basis and Taxesimposed on the ownership, use or operation of real or personal property shall be prorated on thebasis of the number of days in the annual period elapsed through the Closing Date as compared tothe number of days in the annual period elapsing after the Closing Date, and (B) any transactionthat would be treated under the principles of Treasury Regulation Section 1.338-1(d) as occurringat the beginning of the day following the transaction shall be treated as occurring after theClosing Date. Whenever it is necessary to determine for any taxable period the amount of Taxes, orportions thereof, resulting from a change in Law occurring after the Closing Date, such amountshall equal the amount by which the Taxes imposed for such taxable period determined taking intoaccount such change in Law exceed the Taxes that would have been imposed for such taxable periodabsent such change in Law.
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          (c) *Tax Returns*. Except as provided in Section 4.7(e):               (i) The Sellers shall prepare, or cause to be prepared, and file or cause to be filedwhen due Tax Returns with respect to the Companies and their Subsidiaries for any taxableperiod ending on or before the Closing Date. The Sellers shall bear all costs of preparingsuch Tax Returns and shall timely pay any Taxes due on such Tax Returns with respect to theCompanies and their Subsidiaries for any taxable period ending on or before the ClosingDate.               (ii) The Buyer shall prepare, or cause to be prepared, and file or cause to be filedwhen due all other Tax Returns with respect to the Companies and their Subsidiaries. TheBuyer shall bear all costs of preparing such Tax Returns and shall timely pay any Taxes dueon such Tax Returns with respect to the Companies and their Subsidiaries for any taxableperiod ending after the Closing Date.               (iii) If either the Buyer or the Sellers may be liable for any portion of the Taxpayable in connection with any Tax Return to be filed by the other, the party responsibleunder this Agreement for filing such return (the “**Preparer**”) shall prepare and deliver tothe other party (the “**Payor**”) a copy of such return and any schedules, work papers and otherdocumentation then available that are relevant to the preparation of the portion of suchreturn for which the Payor is or may be liable under this Agreement not later than 45 daysbefore the Due Date (as defined in Section 4.7(j) of this Agreement). The Preparer shallnot file such return until the earlier of either the receipt of written notice from thePayor indicating the Payor’s consent thereto, or the Due Date.               (iv) The Buyer shall provide the Sellers with copies of all Tax Returns filed, orcaused to be filed, by the Buyer with respect to the Companies and their Subsidiaries forperiods beginning on or before the Closing Date and ending after the Closing, and theSellers shall provide the Buyer with copies of all Tax Returns filed, or caused to be filed,after the Closing Date by the Sellers with respect to the Companies and their Subsidiaries.The Sellers shall reimburse the Buyer for all Taxes allocated tothe portion of the taxable period that ends on or before the Closing Date on such TaxReturns, to the extent such Taxes have not been previously paid by the Sellers, any Company,or any Subsidiary of a Company to the relevant taxing authority.               (v) The Payor shall have the option of providing to the Preparer, at any time at least15 days prior to the Due Date, written instructions as to how the Payor wants any, or all,of the items for which it may be liable reflected on such Tax Return. The Preparer shall,in preparing such return, cause the items for which the Payor is liable under this Agreementto be reflected in accordance with the Payor’s instructions (unless, in the opinion of apartner of an internationally recognized law or accounting firm retained by the Preparer,complying with the Payor’s instructions would likely subject the Preparer to any criminalpenalty or a non-criminal penalty in an amount equal to at least 20% of the Tax on any suchitem) and, in the absence of having received such instructions, in accordance with pastpractice. The Payor shall pay to the Preparer the amount of the Taxes with respect to suchTax Return for which the Payor is liable not later than five days before such Tax Return isdue.
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               (vi) If the Preparer fails to satisfy its obligations under this Section 4.7(c), thePayor shall have no obligation to indemnify the Preparer for any incremental Taxes that arereflected on any such return as a result of such failure or any related Loss, and shallretain any and all remedies it may otherwise have that arise out of such failure.          (d) *Contest Provisions.*               (i) Notification of Contests. After the date hereof, each of the Buyer, on the onehand, and the Sellers, on the other hand (the “**Recipient**”), shall notify the Sellers or theBuyer, as the case may be, in writing within five days of receipt by the Recipient ofwritten notice of any pending or threatened audits, adjustments, assessments or otherproceedings (a “**Tax Audit**”) that may affect the liability for Taxes of such other party. Ifthe Recipient fails to give such prompt notice to the other party, it shall not be entitledto indemnification for any Taxes arising in connection with such Tax Audit if such failureto give notice adversely affects the other party’s right to participate in the Tax Audit.               (ii) *Which Party Controls.*          (A) *Sellers’ Items.*If such Tax Audit relates to any Taxes for which theSellers are liable under this Agreement, the Sellers shall, at their expense,control the defense and settlement of such Tax Audit.          (B) *Buyer’s Items.*If such Tax Audit relates to any Taxes for which the Buyeris liable under this Agreement, the Buyer shall, at its expense, control the defenseand settlement of such Tax Audit.          (C) *Combined and Mixed Items.*If such Tax Audit relates to Taxes for whichboth the Sellers and the Buyer are liable under this Agreement, to the extentpracticable such Tax Items (as defined in Section 4.7(j)) will bedistinguished and each party will control the defense and settlement of thoseTaxes for which it is so liable.          (D) *Inseparable Items.*If such Tax Audit relates to a taxable period, orportion thereof, beginning before and ending after the Closing Date and any Tax Itemcannot be identified as being a liability of only one party or cannot be separatedfrom a Tax Item for which the other party is liable, the Sellers shall control thedefense and settlement of the Tax Audit, provided that the Sellers defend the itemsas reported on the relevant Tax Return, otherwise the Buyer shall control thedefense and settlement of the Tax Audit.          (e) *Transfer Taxes.*All excise, sales, use, value added, transfer (including real propertytransfer or gains), stamp, documentary, filing, recordation and other similar taxes, levies,assessments, customs, duties, imposts, charges or fees, together with any interest, additions orpenalties with respect thereto and any interest in respect of such additions or penalties,resulting directly from the sale and transfer by the Sellers to the Buyer of the Shares (the“**Transfer Taxes**”), shall be borne fully by the Buyer. Notwithstanding Section 4.7(c) of thisAgreement, which shall not apply to Tax Returns relating to Transfer Taxes, any Tax
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Returns thatmust be filed in connection with Transfer Taxes shall be prepared and filed when due by the partyprimarily or customarily responsible under the applicable local Law for filing such Tax Returns,and such party will use its commercially reasonable efforts to provide such Tax Returns to theother party at least 10 days prior to the Due Date for such Tax Returns. If, pursuant to theimmediately preceding sentence, a Seller is required to file a Tax Return relating to TransferTaxes, the Buyer shall pay to such Seller the Transfer Taxes shown as due on such Tax Return nolater than five days after a Seller has provided a copy of such Tax Return to the Buyer.          (f) *Buyer’s Claiming, Receiving or Using of Refunds, Overpayments and Prepayments.*If, afterthe Closing, the Buyer, any Company or any of its Subsidiaries (A) receives any refund (whether bypayment, offset, credit or otherwise) or (B) utilizes the benefit of any overpayment of Taxes(including any overpayment that results in a value-added Tax asset or credit) that, in each case(A) and (B), (x) relates to Taxes for which the Sellers are liable or paid by the Sellers, anyCompany or any of its Subsidiaries with respect to a taxable period, or portion thereof, ending onor before the Closing Date, or (y) is the subject of indemnification by the Sellers under thisAgreement, the Buyer shall promptly transfer, or cause to be transferred, to the Sellers the entireamount of the refund or overpayment (including interest) received or utilized by the Buyer, anyCompany or any of its Subsidiaries. For purposes of the immediately preceding sentence, aprepayment on or before the Closing Date of Taxes for which the Buyer is liable shall be treated inthe same manner as an overpayment of Taxes for which the Sellers are liable. The Buyer agrees tonotify the Sellers within 15 days following the discovery of a right to claim any such refund oroverpayment and the receipt of any such refund or utilization of any such overpayment. The Buyeragrees to claim any such refund or to utilize any such overpayment as soon as possible and tofurnish to the Sellers all information, records and assistance necessary to verify the amount ofthe refund or overpayment.          (g) In the event the liability of or with respect to Taxes for which the Sellers are liablehereunder is increased and the particular item that produced such increase results,directly or indirectly, in an actual or potential reduction in the liability of the Buyer orits affiliates for Taxes (a “**Buyer Tax Benefit**”), the Buyer shall be liable for and shall pay tothe Sellers the amount of such Buyer Tax Benefit; provided that such amount shall not exceed theamount of the additional Taxes payable by the Sellers resulting from such item (a “**Seller TaxDetriment**”). Such payment shall be made within 30 days after the later of (i) the due date(without regard to waivers or extensions) of the Tax Return for the Tax period during which theBuyer Tax Benefit was realized or (ii) the date notice is given by the Sellers to the Buyer withrespect to such payment. In the event of the later adjustment, in whole or in part, of any itemthat produced the Buyer Tax Benefit or the Seller Tax Detriment, the Sellers shall refund to theBuyer any amount previously paid under this Section 4.7(g) that is determined not to be owing as aresult of such adjustment, or the Buyer shall further remit to the Sellers the amount of anyincrease in the amount required to be paid under this Section 4.7(g) as a result of suchadjustment. The parties shall promptly notify each other of any Buyer Tax Benefit or Seller TaxDetriment and provide details supporting the calculation of the amount thereof. The amount of anyBuyer Tax Benefit or Seller Tax Detriment shall be calculated by comparing the Taxes payablewithout the adjustment in question with the Taxes payable after taking into account suchadjustment, without regard to loss carryforwards or carrybacks.
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          (h) *Post-Closing Actions That Affect the Sellers’ Liability for Taxes*. Neither the Buyer, anyCompany nor any affiliate of any of them shall take any action (including amending any Tax Return)on or after the Closing Date that could materially increase the Sellers’ (or Sellers’shareholders’) liability for Taxes (including any liability of the Sellers to indemnify the Buyerfor Taxes under this Agreement and any liability of Sellers or their direct or indirectshareholders for Taxes imposed pursuant to Sections 951 through 964 of the Code), without the priorwritten consent of PII.          (i) *Assistance and Cooperation.*The parties agree that, after the Closing Date:          (i) Each party shall assist (and cause its affiliates to assist) the other party inpreparing any Tax Returns that such other party is responsible for preparing and filing;          (ii) The parties shall cooperate fully in preparing for any Tax Audits, or disputeswith taxing authorities, relating to any Tax Returns or Taxes of any Company or any of itsSubsidiaries, including providing access, as reasonably needed, to relevant books andrecords relating to Taxes at issue;          (iii) The parties shall make available to each other and to any taxing authority asreasonably requested all relevant books and records relating to Taxes;          (iv) Each party shall promptly furnish the other party with copies of all relevantcorrespondence received from any taxing authority in connection with any Tax Audit orinformation request relating to Taxes for which such other party may have an indemnificationobligation under this Agreement; and          (v) Except as otherwise provided in this Agreement, the party requesting assistance orcooperation shall bear the other party’s out-of-pocket expenses in complying with suchrequest to the extent that those expenses are attributable to fees and other costs ofunaffiliated third-party service providers.          (j) For purposes of this Agreement, “**Tax**” or “**Taxes**” shall mean taxes of any kind, levies orother like assessments, customs, duties, imposts, charges or fees, including income taxes, grossreceipts, ad valorem, value added, excise, real or property, asset, sales, use, license, payroll,transaction, capital, net worth, withholding, estimated, social security, utility, workers’compensation, severance, production, unemployment compensation, occupation, premium, windfallprofits, transfer and gains taxes or other governmental taxes imposed or payable to the UnitedStates, or any state, county, local or foreign government or subdivision or agency thereof,together with any interest, penalties or additions with respect thereto and any interest in respectof such additions or penalties; “**Due Date**” shall mean, with respect to any Tax Return, the datesuch return is due to be filed (taking into account any valid extensions); and “**Tax Item**” shallmean, with respect to Taxes, any item of income, gain, deduction, loss or credit or other taxattribute.          Section 4.8 *Withholding Taxes*. Any payments from the Buyer to the Sellers hereunder shall be made free andclear of, and without deduction or withholding for, any Taxes,
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unless such deduction or withholdingis required by applicable Law. If the Buyer is required by applicable Law to deduct or withholdTaxes from such payments, then the Buyer shall pay, in addition to the amount otherwise due toSellers hereunder, such additional amount as is necessary to ensure that the net amount actuallypaid to Sellers will equal the full amount Sellers would have received had no such deduction orwithholding been required.          Section 4.9 *Employees; Employee Benefits*.          (a) The Buyer shall be permitted to offer employment to any of the employees of any subsidiaryof PII (other than the Companies and their Subsidiaries) who are identified in Section 4.9(a) ofthe Seller Disclosure Letter (the “**Operating Employees**”), provided that the Buyer shall conditionsuch employment on the resignation of the Operating Employee from his or her employer that is PIIor any affiliate of PII so that the Operating Employee’s termination of employment with PII or anyaffiliate of PII shall not give rise to any benefit under any applicable severance plan. The Buyershall indemnify and hold harmless PII and its affiliates for severance or similar benefits made toany Operating Employee who accepts employment with the Buyer effective as of the Closing Date.          (b) The Buyer agrees that, for a period beginning on the date of this Agreement and ending onthe third anniversary of the Closing Date, it will not, and will cause any of its affiliates notto, directly or indirectly solicit the employment of any of the employees of PII or its affiliates,other than the Operating Employees and the employees of the Companies and their respectiveSubsidiaries; provided, however, that a general advertisement or generalsolicitation for potential employees shall not be considered a breach of this Section 4.9(b),and a decision to hire any employee of PII or its affiliates who applies in response to suchsolicitation shall not be considered a breach of this Section 4.9(b).          (c) On and after the Closing, until at least the first anniversary of the Closing, the Buyershall provide the employees and former employees of any Company or any of its Subsidiaries and theOperating Employees who accept employment with the Buyer (the employees of any Company or any ofits Subsidiaries and the Operating Employees who accept employment with the Buyer are hereinaftercollectively referred to as the “**Affected Employees**”) with compensation and benefits substantiallysimilar in the aggregate than those provided by PII or the applicable affiliate of PII immediatelyprior to the Closing Date.          (d) If any Affected Employee becomes a participant in (i) any “employee benefit plan,” as suchterm is defined in Section 3(3) of ERISA, (ii) any plan that would be an employee benefit plan ifit were subject to ERISA or the Code, such as plans outside the jurisdiction of the United States,(iii) any bonus, deferred compensation, excess benefit, or incentive compensation plan, (iv) anysupplemental unemployment, sick leave, vacation pay, long-term disability, post-retirement medicalor life insurance, and (v) any other plan, program, policy, or arrangement providing benefits toemployees (collectively, “**Benefit Plans**”) of the Buyer or any of its affiliates (a “**Buyer Plan**”),such employee shall be given credit under such Buyer Plan for all service prior to the Closing Datewith PII or the employer affiliate (to the extent such credit was given by PII or the employeraffiliate) and all service prior to the time each employee becomes such a participant, for purposesof eligibility and vesting and for all other purposes for which such service is either taken intoaccount or recognized (other than for
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purposes of benefit accrual under defined benefit plans);provided, however, such service need not be credited to the extent it would result in a duplicationof benefits. The Buyer shall amend or cause to be amended any of the Buyer Plans to the extentnecessary to recognize all service of the Affected Employees as required by this Section 4.9(d).          (e) In the event that any person who is an employee of any Company or any of its Subsidiariesimmediately prior to the Closing is discharged by the Buyer, any Company or such Subsidiary, or isdeemed discharged or can bring a claim of discharge, as of or after the Closing Date, then theBuyer shall be responsible for any severance costs for such employee including (i) such severancecosts that become payable under applicable Law and (ii) costs as set forth in Section 4.9(e) of theSeller Disclosure Letter. The Buyer shall be responsible and assume all liability for all noticesor payments due to any such employees, and all notices, payments, fines or assessments due to anylaw (including common law), statute or ordinance of any nation or state or any regulation, policy,protocol, proclamation or executive order promulgated by any union representing Affected Employeesor any national, federal, regional, state, local or other governmental agency, authority,administrative agency, regulatory body, commission, instrumentality, court, official or arbitraltribunal having governmental or quasi-governmental powers with respect to the employment, dischargeor layoff of employees by Buyer or any affiliate as of or after the Closing, including the WorkerAdjustment and Retraining Notification Act and any rules or regulations as have been issued inconnection with the foregoing.          (f) If an Affected Employee is participating in a Benefit Plan sponsored by PII or any of itssubsidiaries that provides health benefits, whether or not subject to U.S. Law, immediately priorto the Closing Date, the Buyer agrees that, upon the Closing, such Affected Employee shall beimmediately eligible to participate, without any waiting time, in a Buyer Plan that provides healthbenefits, and Buyer shall credit such Affected Employee under such Buyer Plan, for the calendaryear during which the Closing Date occurs, with the deductibles, coinsurance and maximumout-of-pocket provisions and any other applicable expenses already incurred during the portion ofthe year preceding the Closing Date under the applicable Benefit Plan sponsored by PII or any ofits subsidiaries that provides health benefits. The Buyer shall be responsible and assume allliability for obligations, if any, relating to post-retirement welfare plans covering the AffectedEmployees or former employees of any Company or any of its Subsidiaries, which obligation issummarized in Section 4.9(f) of the Seller Disclosure Letter.          (g) The Buyer acknowledges that, at the Closing, the participation by each of the Companiesand their respective Subsidiaries in all Benefit Plans not sponsored or maintained solely by any ofthe Companies and such Subsidiaries shall terminate, and the Buyer shall be solely responsible forproviding any successor or alternate plans.          (h) The Buyer shall cause the Companies and their respective Subsidiaries to honor anycollective bargaining agreements identified on Section 2.5 of the Seller Disclosure Letter.          (i) From and after the Closing Date, the Buyer shall be responsible for, and shall indemnifyand hold harmless, the Sellers and their respective officers, directors, employees, affiliates andagents and the fiduciaries (including plan administrators) of the Benefit Plans, from
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and against,any and all claims, losses, damages, costs and expenses (including attorneys’ fees and expenses)and other liabilities and obligations relating to or arising out of (i) all compensation, salaries,commissions and vacation entitlements accrued but unpaid as of the Closing and post-Closing bonusesdue to any Affected Employee, (ii) the liabilities assumed by the Buyer under this Section 4.9 orany failure by the Buyer to comply with the provisions of this Section 4.9, and (iii) any claimsof, or damages or penalties sought by, any Affected Employee, any national, federal, regional,state, local or other governmental agency, authority, administrative agency, regulatory body,commission, instrumentality, court, official or arbitral tribunal having governmental orquasi-governmental powers on behalf of or concerning any Affected Employee, or any unionrepresenting any Affected Employee, with respect to any act or failure to act by the Buyer to theextent arising from the employment, discharge, layoff or termination of any Affected Employee on orafter the Closing Date.          Section 4.10 *Supplemental Disclosure*. The Sellers shall have the right from time to time prior to the Closingto supplement or amend the Seller Disclosure Letter with respect to any matter hereafter arising ordiscovered that if existing or known at the date of this Agreement would have been required to beset forth or described in such Seller Disclosure Letter. Any such supplemental or amendeddisclosure will not be considered when determining whether the condition set forth in Section5.3(a) or any other condition to Closing has been satisfied. Such supplemental or amendeddisclosure will, however, for purposes of determining whether any Buyer Indemnitee is entitled toindemnification pursuant to Section 7.2, be deemed to amend the Seller Disclosure Letter to reflectthe matters set forth in such disclosure and to have been disclosed as of the date of thisAgreement.          Section 4.11 *Advice of Changes*. The Sellers, on the one hand, and the Buyer, on the other hand, will giveprompt notice to the other upon becoming aware of (i) the occurrence, or failure to occur, of anyevent which would be likely to cause any representation or warranty of such party contained in thisAgreement to be untrue or inaccurate in any material respect and (ii) any failure on its part tocomply with or satisfy in any material respect any covenant, condition or agreement to be compliedwith or satisfied by it under this Agreement on or prior to the Closing Date. Except as set forthin Section 4.10 or Section 7.1, no notice pursuant to this Section 4.11 will affect anyrepresentations or warranties, covenants, agreements, obligations or conditions set forth herein orlimit or otherwise affect any available remedies.          Section 4.12 *Performance Bonds*. If any Seller or any of its affiliates (other than any Company or any of itsSubsidiaries) has posted a performance, local import or other similar bond, letter of credit orother guarantee in connection with the operation of the Business, the Buyer and such Seller shallcooperate with each other in order (i) for such Seller or any such affiliate to obtain the releaseof any such bond, letter of credit or guarantee and (ii) to the extent required, for the Buyer toobtain a substitute bond, letter of credit or guarantee or to assume such Seller’s or suchaffiliate’s existing bond, letter of credit or guarantee. The Buyer shall reimburse such Sellerfor all costs incurred by such Seller or any such affiliate as a result of such Seller’s or suchaffiliate’s leaving a performance, local import or similar bond, letter of credit or otherguarantee in place after the Closing Date in order to permit the Buyer to operate the Businessafter the Closing Date.
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          Section 4.13 *Restricted Activities*.          (a) In consideration of the payment of the Purchase Price, and to further induce the Buyer toenter into this Agreement, PII hereby agrees that, for a period commencing on the Closing Date andcontinuing for a period of three years from the Closing Date, neither PII nor any of itssubsidiaries, during the period an entity is a subsidiary, will directly or indirectly, eitheracting on its own behalf or through or in connection with any person, (i) engage in, invest in orderive any profit from Restricted Activities in the Territory (each as defined below); (ii)solicit, recruit or hire any employee of the Companies and their Subsidiaries; or (iii) solicit orencourage any employee of the Company and such Subsidiaries to leave the employment of the Companyand such Subsidiaries; *provided, however*, that a general advertisement or general solicitation forpotential employees shall not be considered a breach of this Section 4.13(a), and a decision tohire any employee of any Company or any such Subsidiary who applies in response to suchsolicitation shall not be considered a breach of this Section 4.13(a). Notwithstanding theforegoing, this Section 4.13 shall not restrict: (i) the ownership by PII or any of itssubsidiaries of less than an aggregate of 20% of any class of stock of a person engaged, directlyor indirectly, in Restricted Activities within the Territory; or (ii) the acquisition and continued ownershipby PII or any of its subsidiaries of any person that, prior to the acquisition thereof, is not anaffiliate of PII and that engages, directly or indirectly, in Restricted Activities within theTerritory (A) if such Restricted Activities within the Territory account for less than 20% of suchperson’s consolidated annual revenues for its most recently completed fiscal year or (B) if PII orsuch subsidiary disposes of or agrees to dispose of or discontinues such person’s business engagedin Restricted Activities within the Territory within one year after the closing of suchacquisition.          (b) Each Seller acknowledges and agrees that the covenants and restrictions contained in thisSection 4.13 are an essential element of the Buyer’s agreeing to acquire the Shares and pay thePurchase Price as set forth herein, and that the Buyer would not have done so but for the agreementby PII to comply with the terms and provisions of this Section 4.13.          (c) Each Seller hereby agrees that the geographic and business scope and the duration of thecovenants and restrictions in this Section 4.13 are fair and reasonable. However, if any provisionof this Section 4.13 is held to be invalid or unenforceable by reason of the geographic or businessscope or duration thereof, the court or other tribunal is hereby directed to construe and enforcethis Section 4.13 as if the geographic or business scope or the duration or such provision has beenmore narrowly drawn as so not to be invalid or unenforceable, and such invalidity orunenforceability shall not affect or render invalid or unenforceable any other provision of thisAgreement.          (d) For purposes of this Section 4.13, (i) the term “**Restricted Activities**” means the businessof providing (x) services using land drilling or land workover rigs or (y) pressure pumping,formation testing, underbalance drilling, drilling fluids, directional drilling, fishing tools orproduction services with respect to onshore oil and natural gas wells; and (ii) the term“**Territory**” shall mean Mexico, Central America and South America.          Section 4.14 *Financing*. The Buyer shall, and shall cause its affiliates to, use their commercially reasonableefforts to take, or cause to be taken, all actions and to do, or cause to be done, all thingsnecessary, appropriate or advisable to arrange the Financing on the terms
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and conditions describedin the Financing Commitment (provided that the Buyer may replace or amend the Financing Commitmentto add lenders, lead arrangers, bookrunners, syndication agents or similar entities who had notexecuted the Financing Commitments as of the date hereof, or otherwise replace or amend theFinancing Commitment so long as (a) after such actions, the Financing Commitment does not includeany additional conditions precedent that are not contained in the Financing Commitment provided tothe Sellers as of the date of this Agreement, and (b) such actions are not reasonably likely todelay, or diminish the likelihood of, the Buyer obtaining the Financing (clauses (a) and (b)together being referred to as the “**Financing Modification Requirements**”; for purposes of thisAgreement, the term “Financing Commitment” shall be deemed to include any such replacement oramended financing), including using commercially reasonable efforts to (i) maintain in effect theFinancing Commitment or any Alternative Financing (as defined below), (ii) satisfy on a timelybasis all conditions applicable to the Buyer to obtaining the Financing set forth therein, (iii)negotiate and enter into definitive agreements with respect thereto on the terms and conditionscontemplated by the Financing Commitment or anyAlternative Financing, and (iv) consummate the Financing on the terms and conditions contemplatedby the Financing Commitments or any Alternative Financing at or prior to the Closing. In the eventany portion of the Financing becomes unavailable on the terms and conditions contemplated in theFinancing Commitment, the Buyer shall, and shall cause its affiliates to, use their commerciallyreasonable efforts to arrange to obtain alternative financing from alternative sources in an amountsufficient to consummate the transactions contemplated by this Agreement on terms and conditionsthat are not materially less beneficial to the Buyer than those contained in the FinancingCommitment as in effect on the date of this Agreement as determined in the reasonable good faithjudgment of the Buyer and consistent with the Financing Modification Requirements (any suchalternative financing actually obtained by the Buyer, “**Alternative Financing**”) as promptly aspracticable following the occurrence of such event.ARTICLE VCONDITIONS TO CONSUMMATION OF THE PURCHASE          Section 5.1 *Conditions to Each Party’s Obligations to Consummate the Purchase*. The respective obligations ofeach party to consummate the transactions contemplated by this Agreement are subject to thecondition that, after the date hereof and at or prior to the Closing Date, no statute, rule,regulation, executive order, decree or injunction shall have been enacted, entered, promulgated orenforced by any Governmental Entity that prohibits the consummation of the Purchase.          Section 5.2 *Further Conditions to the Sellers’ Obligations*. The obligation of each of the Sellers toconsummate the transactions contemplated by this Agreement is further subject to satisfaction orwaiver in writing at or prior to the Closing Date of the following conditions:     (a) The representations and warranties of the Buyer contained in Article III of thisAgreement shall be true and correct in all material respects as of the date of thisAgreement and at and as of the Closing Date as though such representations and warrantieswere made at and as of such date (except for representations and warranties
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that are as of a different date or period, which shall be true and correct in all material respects as ofsuch other date or period); and     (b) The Buyer shall have performed and complied in all material respects with allagreements and obligations required by this Agreement to be performed or complied with by iton or prior to the Closing.     Section 5.3 *Further Conditions to the Buyer’s Obligations*. The obligation of the Buyer to consummate thetransactions contemplated by this Agreement are further subject to the satisfaction or waiver inwriting at or prior to the Closing Date of the following conditions:     (a) The representations and warranties of the Sellers contained in Article II of thisAgreement shall be true and correct in all material respects as of the date of thisAgreement and at and as of the Closing Date as though such representations and warrantieswere made at and as of such date (except for representations and warranties that are as of adifferent date or period, which shall be true and correct in all material respects as ofsuch other date or period);     (b) The Sellers shall have performed and complied in all material respects with allagreements and obligations required by this Agreement to be performed or complied with by iton or prior to the Closing;     (c) At any time after the date of this Agreement, there shall not have occurred anyfacts, changes or occurrences that, individually or in the aggregate, have had, or wouldreasonably be expected to have, a Business Material Adverse Effect; and     (d) The Sellers shall have obtained and furnished to the Buyer all third-party consentslisted in Section 2.6 of the Seller Disclosure Letter and marked with an asterisk in formand substance reasonably satisfactory to the Buyer.     Section 5.4 *Frustration of Closing Conditions*. Neither the Buyer nor any Seller may rely on the failure of anycondition set forth in this Article V to be satisfied if such failure was caused by such party’sfailure to use its commercially reasonable efforts to cause the Closing to occur as required bySection 4.5.ARTICLE VITERMINATION AND ABANDONMENT          Section 6.1 *Termination*. This Agreement may be terminated and the transactions contemplated by this Agreementmay be abandoned at any time prior to the Closing only:     (a) by mutual written consent of PII and the Buyer;     (b) by PII or the Buyer by giving written notice to the other party at any time afterOctober 9, 2007 if the Closing shall not have occurred by such date;
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     (c) by PII or the Buyer by giving written notice to the other party if a GovernmentalEntity shall have issued an order, decree or ruling or taken any other action permanentlyrestraining, enjoining or otherwise prohibiting a material portion of the transactionscontemplated by this Agreement and such order, decree, ruling or other action shall havebecome final and non-appealable;     (d) by PII, if the Buyer breaches or fails to perform its representations, warrantiesor covenants contained in this Agreement, which breach or breaches or failure or failures toperform (i) would, individually or in the aggregate, give rise to the failure ofa condition set forth in Section 5.2(a) or (b) and (ii) cannot be cured or, if curable,is not or are not cured within 10 days after written notice from PII; or     (e) by the Buyer, if one or more of the Sellers breach or fail to perform theirrepresentations, warranties or covenants contained in this Agreement, which breach orbreaches or failure or failures to perform (i) would, individually or in the aggregate, giverise to the failure of a condition set forth in Section 5.3(a) or (b) and (ii) cannot becured or, if curable, is not or are not cured within 10 days after written notice from theBuyer;*provided, however*, that the party seeking termination pursuant to clause (b), (d) or (e) is notthen in breach of any of its representations, warranties, covenants or agreements contained in thisAgreement, which breaches would give rise to the failure of a condition set forth in Section 5.2(a)or (b), if the Buyer is then seeking termination, or Section 5.3(a) or (b), if PII is then seekingtermination.          Section 6.2 *Procedure for and Effect of Termination*. In the event of termination of this Agreement andabandonment of the transactions contemplated by this Agreement by the parties under Section 6.1 ofthis Agreement, written notice thereof shall be given by a party so terminating to the other partyand this Agreement shall forthwith terminate and shall become null and void and of no furthereffect, and the transactions contemplated by this Agreement shall be abandoned without furtheraction by the Sellers or the Buyer. If this Agreement is terminated under Section 6.1 of thisAgreement:     (a) each party shall redeliver all documents, work papers and other materials of theother parties relating to the transactions contemplated by this Agreement, whether obtainedbefore or after the execution of this Agreement, to the party furnishing the same, and allconfidential information received by any party hereto with respect to the other party shallbe treated in accordance with the Confidentiality Agreement and Section 4.2(b) of thisAgreement;     (b) all filings, applications and other submissions made pursuant hereto shall, at theoption of the Sellers, and to the extent practicable, be withdrawn from the agency or otherperson to which made; and     (c) there shall be no liability or obligation under this Agreement on the part of theSellers or the Buyer or any of their respective directors, officers, employees, affiliates,controlling persons, agents or representatives, except with respect to a breach of Section3.5 of this Agreement and except that the Sellers or the Buyer, as the case may
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be, may haveliability to the other party if the basis of termination is a willful, material breach bythe Sellers or the Buyer, as the case may be, of one or more of the provisions of thisAgreement, and except that the obligations provided for in Section 6.2, Section 8.6, Section8.9 and Section 8.13 of this Agreement shall survive any such termination.ARTICLE VIISURVIVAL AND INDEMNIFICATION          Section 7.1 *Survival Periods*. All representations and warranties of the parties contained in this Agreementshall survive the Closing for the Survival Period (as defined below) but, except as provided inSection 6.2(c) of this Agreement, shall not survive any termination of this Agreement. Therepresentations and warranties shall survive the Closing for the relevant period (the “**SurvivalPeriod**”) determined as follows: (a) the representations and warranties of the Sellers contained inSection 2.1, Section 2.2, Section 2.3 and Section 2.4 of this Agreement and of the Buyer containedin Section 3.1, Section 3.2, Section 3.3 and Section 3.4 of this Agreement shall survive theClosing indefinitely; (b) the representations and warranties of the Sellers contained in Section2.12, Section 2.13, Section 2.14 and Section 2.17 shall survive until the expiration of 90 daysfollowing the expiration of the applicable statute of limitations or prescription period (aftergiving effect to any waiver, mitigation or extension thereof); and (c) all other representationsand warranties of the Sellers contained in Article II of this Agreement and of the Buyer containedin Article III of this Agreement shall survive until the expiration of a period of 18 monthsfollowing the Closing Date. The parties agree that no claims or causes of action may be broughtagainst the Sellers or the Buyer based upon, directly or indirectly, any of the representations orwarranties contained in Articles II and III of this Agreement after the applicable Survival Periodor, except as provided in Section 6.2(c) of this Agreement, any termination of this Agreement;*provided*that nothing herein shall preclude Sellers or Buyer from bringing or pursuing claims afterthe end of the applicable Survival Period if notice thereof is given to the other party before theend of such Survival Period. This Section 7.1 shall not limit any covenant or agreement of theparties, including the covenants and agreements set forth in Section 4.7 and Section 4.9 of thisAgreement. Except as expressly provided in Section 4.10, any claim by an indemnified party forindemnification shall not be adversely affected by any investigation by or opportunity toinvestigate afforded to such party, nor shall such a claim be adversely affected by such party’sknowledge on or before the Closing of any breach of the type specified in Section 7.2(a)(i) or (ii)or Section 7.3(a)(i) or (ii) unless it shall be determined by a final judgment of a GovernmentalEntity having jurisdiction over such Proceeding that the party seeking indemnification had actualand express knowledge of such breach on or before the Closing.          Section 7.2 *PII’s Agreement to Indemnify*.          (a) Upon the terms and subject to the conditions set forth in this Agreement, from and afterthe Closing, PII shall indemnify and hold harmless the Buyer and its directors, officers,employees, affiliates, controlling persons, agents and representatives and their successors andassigns (collectively, the “**Buyer Indemnitees**”) from and against all liability, demands, claims,actions or causes of action, assessments, losses, damages, costs and expenses
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(including reasonableattorneys’ fees and expenses) (collectively, “**Buyer Damages**”) asserted against or incurred by anyBuyer Indemnitee to the extent arising out of or resulting from:          (i) a breach of any representation or warranty contained in Article II of thisAgreement when made or at and as of the Closing Date (or at and as of such different date orperiod specified for such representation or warranty) as though such representation andwarranty were made at and as of the Closing Date (or such different date or period);          (ii) a breach of any covenant of any Sellers contained in this Agreement in each caseto the extent it relates to performance prior to the Closing;          (iii) a breach of any covenant of any Seller contained in this Agreement in each caseto the extent it relates to performance on or after the Closing; and          (iv) any financial advisory and finders’ fees incurred by reason of any action taken byany Seller or otherwise arising out of the transactions contemplated by this Agreement byany person claiming to have been engaged by such Seller.          (b) The obligation of PII to indemnify the Buyer Indemnitees under Section 7.2(a)(i) and (ii)of this Agreement is subject to the following limitations:          (i) No indemnification shall be made by PII pursuant to Section 7.2(a)(i) and (ii)unless the aggregate amount of Buyer Damages exceeds $20,000,000 and, in such event,indemnification shall be made by PII only to the extent that the aggregate amount of BuyerDamages exceed $20,000,000;          (ii) In no event shall PII’s aggregate obligation to indemnify the Buyer Indemniteespursuant to Section 7.2(a)(i) and (ii) exceed $250,000,000 in the aggregate;          (iii) The limitations set forth in Section 7.2(b)(i) and (ii) do not apply to any BuyerDamages to the extent arising out of or resulting from a breach of any representation orwarranty contained in Section 2.14 of this Agreement or a breach of any covenant containedin Section 4.7 of this Agreement;          (iv) The amount of any Buyer Damages shall be reduced by any amount actually receivedby a Buyer Indemnitee (including, for this purpose, each Company and its Subsidiaries) withrespect to such Buyer Damages under any insurance coverage or for any other party alleged tobe responsible for such Buyer Damages. The Buyer Indemnitees shall use commerciallyreasonable efforts to collect any amounts available under such insurance coverage and fromsuch other party alleged to have responsibility. If a Buyer Indemnitee actually receivesany amount under insurance coverage or from such other party with respect to Buyer Damagesat any time subsequent to any indemnification provided by PII under this Section 7.2, thensuch Buyer Indemnitee shall promptly reimburse PII for any payment made by PII in connectionwith providing such indemnification up to such amount received by such Buyer Indemnitee; and
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          (v) PII shall be obligated to indemnify the Buyer Indemnitees pursuant to Section7.2(a)(i) only for those claims giving rise to Buyer Damages as to which the BuyerIndemnitees have given PII written notice thereof prior to the end of the SurvivalPeriod. Any written notice delivered by a Buyer Indemnitee to PII with respect toBuyer Damages shall set forth with as much specificity as is reasonably practicable thebasis of the claim for Buyer Damages and, to the extent reasonably practicable, a reasonableestimate of the amount of such claim.     Section 7.3 *Buyer’s Agreement to Indemnify*.          (a) Upon the terms and subject to the conditions set forth in this Agreement, from and afterthe Closing, the Buyer shall indemnify and hold harmless the Sellers and their respectivedirectors, officers, employees, affiliates, controlling persons, agents and representatives andtheir successors and assigns (collectively, the “**Seller Indemnitees**”) from and against allliability, demands, claims, actions or causes of action, assessments, losses, damages, costs andexpenses (including reasonable attorneys’ fees and expenses) (collectively, “**Seller Damages**”)asserted against or incurred by any Seller Indemnitee to the extent arising out of or resultingfrom:          (i) a breach of any representation or warranty contained in Article III of thisAgreement when made or at and as of the Closing Date (or at and as of such different date orperiod specified for such representation or warranty) as though such representation andwarranty were made at and as of the Closing Date (or such different date or period);          (ii) a breach of any covenant of the Buyer contained in this Agreement in each case tothe extent it relates to performance prior to the Closing;          (iii) a breach of any covenant of the Buyer contained in this Agreement in each case tothe extent it relates to performance on or after the Closing; and          (iv) any financial advisory and finders’ fees incurred by reason of any action taken bythe Buyer or otherwise arising out of the transactions contemplated by this Agreement by anyperson claiming to have been engaged by the Buyer.          (b) The Buyer’s obligation to indemnify the Seller Indemnitees under Section 7.3(a)(i) and(ii) of this Agreement is subject to the following limitations:          (i) No indemnification shall be made by the Buyer pursuant to Section 7.3(a)(i) and(ii) unless the aggregate amount of Seller Damages exceeds $20,000,000 and, in such event,indemnification shall be made by the Buyer only to the extent that the aggregate amount ofSeller Damages exceeds $20,000,000;          (ii) In no event shall the Buyer’s aggregate obligation to indemnify the SellerIndemnitees pursuant to Section 7.3(a)(i) and (ii) exceed $250,000,000 in the aggregate;
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          (iii) The amount of any Seller Damages shall be reduced by any amount actually receivedby a Seller Indemnitee with respect to such Seller Damagesunder any insurance coverage or from any other party alleged to be responsible for suchSeller Damages. The Seller Indemnitees shall use commercially reasonable efforts to collectany amounts available under such insurance coverage and from such other party alleged tohave responsibility. If a Seller Indemnitee actually receives any amount under insurancecoverage or from such other party with respect to Seller Damages at any time subsequent toany indemnification provided by the Buyer under this Section 7.3, then such SellerIndemnitee shall promptly reimburse the Buyer, as the case may be, for any payment made bythe Buyer in connection with providing such indemnification up to such amount received bythe Seller Indemnitee; and          (iv) The Buyer shall be obligated to indemnify the Seller Indemnitees pursuant toSection 7.3(a)(i) only for those claims giving rise to Seller Damages as to which the SellerIndemnitees have given the Buyer written notice thereof prior to the end of the SurvivalPeriod. Any written notice delivered by a Seller Indemnitee to the Buyer with respect toSeller Damages shall set forth with as much specificity as is reasonably practicable thebasis of the claim for Seller Damages and, to the extent reasonably practicable, areasonable estimate of the amount of such claim.     Section 7.4 *Third-Party Indemnification*. The obligations of PII to indemnify the Buyer Indemnitees underSection 7.2 of this Agreement with respect to Buyer Damages and the obligations of the Buyer toindemnify the Seller Indemnitees under Section 7.3 of this Agreement with respect to SellerDamages, in either case resulting from the assertion of liability by third parties (each, as thecase may be, a “**Claim**”), will be subject to the following terms and conditions:     (a) Any party against whom any Claim is asserted will give the indemnifying partywritten notice of any such Claim promptly after learning of such Claim, and the indemnifyingparty may, at its option, undertake the defense of such Claim by counsel of its ownchoosing; *provided*that such counsel is not reasonably objected to by the indemnified party.Failure to give prompt notice of a Claim under this Agreement shall not affect theindemnifying party’s obligations under this Article VII, except to the extent theindemnifying party is materially prejudiced by such failure to give prompt notice. If theindemnifying party, within 30 days after notice of any such Claim, or such shorter period asis reasonably required, fails to assume the defense of such Claim, the Buyer Indemnitee orthe Seller Indemnitee, as the case may be, against whom such Claim has been made will (uponfurther notice to the indemnifying party) have the right to undertake the defense,compromise or settlement of such Claim on behalf of and for the account and risk, and at theexpense, of the indemnifying party.     (b) Anything in this Section 7.4 to the contrary notwithstanding, the indemnifyingparty shall not enter into any settlement or compromise of any action, suit or proceeding orconsent to the entry of any judgment (i) that does not include as an unconditional termthereof the delivery by the claimant or plaintiff to the Seller Indemnitee or the BuyerIndemnitee, as the case may be, of a written release from all liability in respect of suchaction, suit or proceeding or (ii) for other than monetary
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damages to be borne by theindemnifying party, without the prior written consent of theSeller Indemnitee or the Buyer Indemnitee, as the case may be, which consent shall notbe unreasonably withheld.     (c) The indemnifying party and the indemnified party shall cooperate fully in allaspects of any investigation, defense, pretrial activities, trial, compromise, settlement ordischarge of any claim in respect of which indemnity is sought under this Article VII,including by providing the other party with reasonable access to employees and officers(including as witnesses) and other information.          Section 7.5 *No Setoff*. Neither the Buyer nor PII shall have any right to setoff any Buyer Damages or SellerDamages, respectively, against any payments to be made by either of them under this Agreement.          Section 7.6 *Insurance*. The indemnifying party shall be subrogated to the rights of any indemnified party inrespect of any insurance relating to Buyer Damages or Seller Damages, as the case may be, to theextent of any indemnification payments made under this Agreement, and the indemnified party shallprovide all reasonably requested assistance to the indemnifying party in respect of suchsubrogation.          Section 7.7 *No Duplication*. Any liability for indemnification under this Agreement shall be determined withoutduplication of recovery by reason of the state of facts (i) giving rise to such liabilityconstituting a breach of more than one representation, warranty, covenant or agreement or (ii)taken into account in determining any adjustment to the Purchase Price under Section 1.10(c).Article VII shall not apply to Tax claims to the extent those claims are separately indemnifiedunder Section 4.7.          Section 7.8 *Sole Remedy*.          (a) The parties agree that the sole and exclusive monetary remedy of any party to thisAgreement, any Buyer Indemnitee or any Seller Indemnitee or their respective affiliates withrespect to this Agreement or any other claims relating to the Business, the events giving rise tothis Agreement and the transactions provided for in this Agreement or contemplated by thisAgreement or by any other such claims relating to the Business, events giving rise to thisAgreement and the transactions provided for in this Agreement (other than claims of, or causes ofaction arising from, fraud) shall be limited to the indemnification provisions set forth in Section4.7 and this Article VII and, in furtherance of the foregoing, each of the parties, on behalf ofitself and its affiliates, waives and releases the other parties to this Agreement (and such otherparties’ affiliates) from, to the fullest extent permitted under any applicable Law, any and allrights, claims and causes of action it or its affiliates may have against the other parties to thisAgreement (other than claims of, or causes of action arising from, fraud) except pursuant to theindemnification provisions set forth in Section 4.7 and this Article VII.          (b) The parties intend that, even though indemnification and other obligations appear invarious sections and articles of this Agreement, the indemnification procedures and limitationscontained in this Article VII shall apply to all indemnity and other obligations of the
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parties under this Agreement, except as provided in Section 4.7 and except to the extent expressly excludedin this Article VII.          Section 7.9 *No Special Damages*. **IN NO EVENT SHALL ANY BUYER DAMAGES OR SELLER DAMAGES HEREUNDER INCLUDEEXEMPLARY, SPECIAL, PUNITIVE, INDIRECT, REMOTE, SPECULATIVE OR CONSEQUENTIAL DAMAGES EXCEPT TO THEEXTENT ANY SUCH DAMAGES ARE PAYABLE TO AN UNAFFILIATED THIRD PARTY IN CONNECTION WITH A THIRD PARTYCLAIM.**          Section 7.10 *Express Negligence*. **THE FOREGOING INDEMNITIES ARE INTENDED TO BE ENFORCEABLE AGAINST THE PARTIESIN ACCORDANCE WITH THE EXPRESS TERMS AND SCOPE THEREOF NOTWITHSTANDING ANY EXPRESS NEGLIGENCE RULEOR ANY SIMILAR DIRECTIVE THAT WOULD PROHIBIT OR OTHERWISE LIMIT INDEMNITIES BECAUSE OF THENEGLIGENCE (WHETHER SOLE, CONCURRENT, ACTIVE OR PASSIVE) OR OTHER FAULT OR STRICT LIABILITY OF ANYOF THE INDEMNIFIED PARTIES**.ARTICLE VIIIMISCELLANEOUS PROVISIONS          Section 8.1 *Amendment and Modification*. This Agreement may be amended, modified or supplemented at any time bythe parties to this Agreement, under an instrument in writing signed by all parties.          Section 8.2 *Entire Agreement; Assignment; Binding Effect*. This Agreement (including the Seller DisclosureLetter) and the Confidentiality Agreement (a) constitute the entire agreement between the partiesconcerning the subject matter of this Agreement and supersede other prior agreements andunderstandings, both written and oral, between the parties concerning the subject matter of thisAgreement and (b) shall not be assigned, by operation of law or otherwise, by a party, without theprior written consent of the other parties; *provided, however,*that, without the prior writtenconsent of any other party, the Buyer may assign its right to purchase all or any portion of theShares to any controlled affiliate of the Buyer organized under the laws of the United States ofAmerica, any political subdivision thereof or any State thereof, Uruguay, the Bahamas, Bermuda, theBritish Virgin Islands, the Cayman Islands or any member of the European Union; *provided, further,however*, that no such assignment shall limit or affect the Buyer’s obligations hereunder.. Subjectto the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and beenforceable by, the parties and their respective successors and assigns.          Section 8.3 *Severability*. The invalidity or unenforceability of any term or provision of this Agreement in anysituation or jurisdiction shall not affect the validity or enforceability of the other terms orprovisions of this Agreement or the validity or enforceability of the offending term or provisionin any other situation or in any other jurisdiction and the remaining terms and provisions shallremain in full force and effect, unless doing so would result in an interpretation of thisAgreement that is manifestly unjust.
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          Section 8.4 *Notices*. Unless otherwise provided in this Agreement, all notices and other communications underthis Agreement shall be in writing and may be given by any of the following methods: (a) personaldelivery; (b) facsimile transmission; (c) registered or certified mail, postage prepaid, returnreceipt requested; or (d) overnight delivery service. Such notices and communications shall besent to the appropriate party at its address or facsimile number given below or at such otheraddress or facsimile number for such party as shall be specified by notice given under thisAgreement (and shall be deemed given upon receipt by such party or upon actual delivery to theappropriate address, or, in case of a facsimile transmission, upon transmission by the sender andissuance by the transmitting machine of a confirmation slip that the number of pages constitutingthe notice have been transmitted without error; in the case of notices sent by facsimiletransmission, the sender shall contemporaneously mail a copy of the notice to the addressee at theaddress provided for above; *provided*, however, that such mailing shall in no way alter the time atwhich the facsimile notice is deemed received): (a) if to any of the Sellers, to    Pride International, Inc.5847 San FelipeHouston, Texas 77057Facsimile: (713) 914-9796Attention: General Counsel                   Legal Department    with a copy to    Baker Botts L.L.P.One Shell Plaza910 Louisiana StreetHouston, Texas 77002-4995Facsimile: (713) 229-7701Attention: J. David Kirkland, Jr.                   Tull R. Florey  (b) if to the Buyer, to    GP Investments Ltd.Clarendon House2 Church Street, Hamilton, HM 11BermudaFacsimile: (441) 292-4720Attention: Stephen Rossiter                   David Cooke
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   with a copy to   Cravath, Swaine & Moore LLP825 Eighth AvenueWorldwide PlazaNew York, New York 10019-7475Facsimile: (212) 474-3700Attention: David Mercado          Section 8.5 *Governing Law*. This Agreement shall be governed by, and construed in accordance with, the Laws ofthe State of New York applicable to contracts executed in and to be performed entirely within thatstate. Without prejudice to the provisions of Section 8.6, all actions and proceedings arising outof or relating to this Agreement shall be heard and determined in any New York state or federalcourt sitting in the Borough of Manhattan in the City of New York, New York, and the parties herebyirrevocably submit to the exclusive jurisdiction of such courts in any such action or proceedingand irrevocably waive the defense of an inconvenient forum to the maintenance of any such action orproceeding. Each party irrevocably consents to the service of any and all process in any suchaction or proceeding by the mailing of copies of such process to such party at its addressspecified in Section 8.4. The Buyer hereby irrevocably designates, appoints and empowersCorporation Service Company, 1133 Avenue of the Americas, New York, New York 10036, as itsdesignee, appointee and agent to receive, accept and acknowledge for and on its behalf service forany and all legal process, summons, notices and documents which may be served in any such action orproceeding which may be made on such designee, appointee and agent in accordance with legalprocedures prescribed for such courts, with respect to any action or proceeding arising out of orrelating to this Agreement. The parties agree that a final judgment in any such action orproceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgmentor in any other manner provided by Law. Nothing in this Section 8.5 shall affect the right of anyparty to serve legal process in any other manner permitted by Law. The consents to jurisdictionset forth in this Section 8.5 shall not constitute general consents to service of process in theState of New York and shall have no effect for any purpose except as provided in this Section 8.5and shall not be deemed to confer rights on any person other than the parties.          Section 8.6 *Dispute Resolution*.          (a) *Negotiation; Mediation*.          (i) In the event of any dispute or disagreement between the Sellers and the Buyer as tothe interpretation of any provision of this Agreement (or the performance of obligationsunder this Agreement), the matter, on written request of either party, shall be referred torepresentatives of the parties for decision, each party being represented by a seniorexecutive officer who has no direct operational responsibility for the matters contemplatedby this Agreement (the “**Representatives**”). The Representatives shall promptly meet in a goodfaith effort to resolve the dispute. If the Representatives do not agree upon a decisionwithin 30 calendar days after reference of
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the matter to them, each of the Buyer and theSellers shall be free to exercise the remedies available to it under Section 8.6(b).          (ii) The Representatives may elect at any time to undertake mediation. TheRepresentatives may elect to utilize the commercial mediation rules of the AmericanArbitration Association (“**AAA**”), either as written or as modified by mutual agreement. Ifarbitration proceedings have been instituted, these proceedings shall be stayed until themediation process is terminated.          (b) *Arbitration*.          (i) Any controversy, dispute or claim arising out of or relating to this Agreement orthe transactions arising hereunder that cannot be resolved by negotiation or mediationpursuant to Section 8.6(a) shall be settled exclusively by final and binding arbitration inNew York, New York. Such arbitration will apply the laws of the State of New York and thecommercial arbitration rules of AAA to resolve the dispute.          (ii) Written notice of arbitration must be given within one year after the accrual ofthe claim on which the notice is based. If the claiming party fails to give notice ofarbitration within that time, the claim shall be deemed to be waived.          (iii) Such arbitration shall be conducted by three independent and impartialarbitrators. Each party shall appoint one arbitrator, and those appointed arbitrators shallselect the third arbitrator, who shall be the presiding arbitrator. Unless the partiesagree otherwise, each arbitrator shall be a licensed attorney with at least ten years ofexperience in the practice of law. If an arbitrator should die, withdraw or otherwisebecome incapable of serving, a replacement shall be selected and appointed in a like manner.          (iv) The arbitrators shall render an opinion setting forth findings of fact andconclusions of law with the reasons therefor stated. A transcript of the evidence adducedat the hearing shall be made and shall, upon request, be made available to either party.The fees and expenses of the arbitrators shall be shared equally by the parties and advancedby them from time to time as required; *provided*that at the conclusion of thearbitration, the arbitrators may award costs and expenses (including the costs of thearbitration previously advanced and the fees and expenses of attorneys, accountants andother experts). The arbitrators shall render their award within 90 days of the conclusionof the arbitration hearing. The arbitrators shall not be empowered to award to either partyany punitive damages in connection with any dispute between them, and each party herebyirrevocably waives any right to recover such damages. The arbitration hearings and awardshall be maintained in confidence.          (v) Notwithstanding anything to the contrary provided in this Section 8.6(b) andwithout prejudice to the above procedures, either party may apply to any court of competentjurisdiction for temporary injunctive or other provisional judicial relief or tospecifically enforce the terms of this Agreement. The award rendered by the arbitrators
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shall be final and not subject to judicial review and judgment thereon may be entered in anycourt of competent jurisdiction.          (c) *Inapplicable to Section 1.10*. Notwithstanding anything to the contrary contained in thisAgreement, this Section 8.6 shall not apply to the provisions of Section 1.10(b) and (c) of thisAgreement.          Section 8.7 *Descriptive Headings*. The descriptive headings used in this Agreement are inserted for convenienceof reference only and shall in no way be construed to define, limit, describe, explain, modify,amplify, or add to the interpretation, construction or meaning of any provision of, or scope orintent of, this Agreement nor in any way affect this Agreement.          Section 8.8 *Counterparts*. This Agreement may be executed in counterparts, each of which shall be deemed anoriginal, but any of which together shall constitute one and the same instrument. An executedcounterpart signature page to this Agreement delivered by fax or other means of electronictransmission shall be deemed to be an original and shall be as effective for all purposes asdelivery of a manually executed counterpart.          Section 8.9 *Fees and Expenses*. Whether or not this Agreement and the transactions contemplated by thisAgreement are consummated, and except as otherwise expressly set forth in this Agreement, all costsand expenses (including legal and financial advisory fees and expenses) incurred in connectionwith, or in anticipation of, this Agreement and the transactions contemplated by this Agreementshall be paid by the party incurring such expenses.          Section 8.10 *Interpretation*.          (a) The phrase “to the knowledge of the Sellers” or any similar phrase shall mean such factsand other information that as of the date of this Agreement are actually knownto the persons listed in Section 8.10 of the Seller Disclosure Letter. In the event anambiguity or question of intent or interpretation arises, this Agreement shall be construed as ifdrafted jointly by the parties and no presumption or burden of proof shall arise favoring ordisfavoring any party by virtue of the authorship of any provisions of this Agreement. Wheneverthe words “include,” “includes” or “including” are used in this Agreement, they shall be deemed tobe followed by the words “without limitation.”          (b) As used in this Agreement:          (i) “**affiliate**” of any person means another person that directly or indirectly, throughone or more intermediaries, controls, is controlled by, or is under common control with,such first person.          (ii) “**person**” means any individual, firm, corporation, partnership, limited liabilitycompany, trust, joint venture, Governmental Entity or other entity.          (iii) “**Subsidiary**” of any person means another person, an amount of the votingsecurities, other voting ownership or voting partnership interests of which is
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sufficient toelect at least a majority of its Board of Directors or other governing body (or, if thereare no such voting interests, 50% or more of the equity interests of which) is owneddirectly or indirectly by such first person or by another Subsidiary of such first person.          Section 8.11 *Third-Party Beneficiaries*. This Agreement is solely for the benefit of the Sellers, theirrespective successors and permitted assigns and the Seller Indemnitees, with respect to theobligations of the Buyer under this Agreement, and for the benefit of the Buyer, its successors andpermitted assigns and the Buyer Indemnitees, with respect to the obligations of the Sellers, underthis Agreement, and for the benefit of the Affected Employees under Section 4.9, and this Agreementshall not be deemed to confer upon or give to any other third party any remedy, claim of liabilityor reimbursement, cause of action or other right.          Section 8.12 *No Waivers*. Except as otherwise expressly provided in this Agreement, no failure to exercise,delay in exercising, or single or partial exercise of any right, power or remedy by any party, andno course of dealing between the parties, shall constitute a waiver of any such right, power orremedy. No waiver by a party of any default, misrepresentation, or breach of warranty or covenantunder this Agreement, whether intentional or not, shall be deemed to extend to any prior orsubsequent default, misrepresentation, or breach of warranty or covenant under this Agreement oraffect in any way any rights arising by virtue of any such prior or subsequent occurrence. Nowaiver shall be valid unless in writing and signed by the party against whom such waiver is soughtto be enforced.          Section 8.13 *Specific Performance*. The parties to this Agreement agree that if any of the provisions of this Agreement were notperformed in accordance with their specific terms or were otherwise breached, irreparable damagewould occur, no adequate remedy at law would exist and damages would be difficult to determine, andthat the parties shall be entitled to specific performance of the terms of this Agreement andimmediate injunctive relief, without the necessity of proving the inadequacy of money damages as aremedy, in addition to any other remedy at law or in equity.
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          IN WITNESS WHEREOF, each of the undersigned has caused this Agreement to be duly signed as ofthe date first above written.      **SELLERS**