exv10w6






Exhibit 10.6




EXECUTION COPY




 





PREFERRED STOCK AND WARRANT PURCHASE AGREEMENT




by and among




NYTEX ENERGY HOLDINGS, INC.,




NYTEX FDF ACQUISITION, INC.




and




WAYPOINT NYTEX, LLC




Senior Series A Redeemable Preferred Stock

Series B Redeemable Preferred Stock

Warrants to Purchase Shares of Common Stock




Dated as of November 23, 2010




 






 









 








TABLE OF CONTENTS

(Not Part of Agreement)




	 	 	 	 	 	 	 	 	 
	Section                                                                           
                                Heading	 	 	Page	 
	 
	Section 1. Definitions
	 	 	 	 	 	 	1	 
	1.1. Defined Terms
	 	 	 	 	 	 	1	 
	1.2. Accounting Principles
	 	 	 	 	 	 	18	 
	1.3. Rules of Construction
	 	 	 	 	 	 	19	 
	Section 2. Issuance and Sale of the Shares and the Warrants
	 	 	 	 	 	 	19	 
	2.1. Authorization of the Shares and the Warrants
	 	 	 	 	 	 	19	 
	2.2. Sale and Purchase of the Shares and Warrants
	 	 	 	 	 	 	20	 
	2.3. Closing
	 	 	 	 	 	 	20	 
	Section 3. Representations and Warranties of Parent and the Company
	 	 	 	 	 	 	20	 
	3.1. Authority
	 	 	 	 	 	 	20	 
	3.2. Formation and Qualification
	 	 	 	 	 	 	21	 
	3.3. Tax Returns
	 	 	 	 	 	 	21	 
	3.4. Financial Statements
	 	 	 	 	 	 	21	 
	3.5. Entity Names
	 	 	 	 	 	 	22	 
	3.6. O.S.H.A. and Environmental Compliance
	 	 	 	 	 	 	22	 
	3.7. Solvency; No Litigation, Violation, Indebtedness or Default
	 	 	 	 	 	 	23	 
	3.8. Patents, Trademarks, Copyrights and Licenses
	 	 	 	 	 	 	24	 
	3.9. Licenses and Permits
	 	 	 	 	 	 	24	 
	3.10. Default of Indebtedness
	 	 	 	 	 	 	25	 
	3.11. No Default
	 	 	 	 	 	 	25	 
	3.12. No Burdensome Restrictions
	 	 	 	 	 	 	25	 
	3.13. No Labor Disputes
	 	 	 	 	 	 	25	 
	3.14. Margin Regulations
	 	 	 	 	 	 	25	 
	3.15. Investment Company Act
	 	 	 	 	 	 	25	 
	3.16. Disclosure
	 	 	 	 	 	 	25	 
	3.17. Delivery of Documents
	 	 	 	 	 	 	26	 
	3.18. Swaps
	 	 	 	 	 	 	26	 
	3.19. Conflicting Agreements
	 	 	 	 	 	 	26	 
	3.20. Application of Certain Laws and Regulations
	 	 	 	 	 	 	26	 
	3.21. Business and Property
	 	 	 	 	 	 	26	 
	3.22. Insurance
	 	 	 	 	 	 	26	 
	3.23. Anti-Terrorism Laws
	 	 	 	 	 	 	26	 






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TABLE OF CONTENTS

(Not Part of Agreement)




	 	 	 	 	 	 	 	 	 
	Section                                                                           
                                Heading	 	 	Page	 
	 
	3.24. Trading with the Enemy
	 	 	 	 	 	 	27	 
	3.25. Federal Securities Laws
	 	 	 	 	 	 	27	 
	Section 4. Representations of Purchaser
	 	 	 	 	 	 	28	 
	4.1. Authority
	 	 	 	 	 	 	28	 
	4.2. Formation
	 	 	 	 	 	 	28	 
	4.3. Investment
	 	 	 	 	 	 	28	 
	Section 5. Closing Conditions
	 	 	 	 	 	 	28	 
	5.1. Conditions to Closing
	 	 	 	 	 	 	28	 
	Section 6. Financial Statements and Information
	 	 	 	 	 	 	31	 
	Section 7. Inspection Rights; Board Observation Rights
	 	 	 	 	 	 	35	 
	7.1. Inspection of Books and Properties
	 	 	 	 	 	 	35	 
	7.2. Board of Directors; Observation Rights
	 	 	 	 	 	 	35	 
	Section 8. Affirmative Covenants
	 	 	 	 	 	 	36	 
	8.1. Maintenance of Corporate Existence, Properties and Records
	 	 	 	 	 	 	36	 
	8.2. Payment of Taxes and Claims
	 	 	 	 	 	 	36	 
	8.3. Compliance With Law
	 	 	 	 	 	 	37	 
	8.4. Environmental Matters
	 	 	 	 	 	 	37	 
	8.5. Insurance
	 	 	 	 	 	 	38	 
	8.6. Use of Proceeds
	 	 	 	 	 	 	38	 
	8.7. Further Assurances
	 	 	 	 	 	 	38	 
	Section 9. Negative Covenants
	 	 	 	 	 	 	39	 
	9.1. Restrictions on Indebtedness
	 	 	 	 	 	 	39	 
	9.2. Restrictions on Liens
	 	 	 	 	 	 	39	 
	9.3. Limitation on Sale and Leasebacks
	 	 	 	 	 	 	40	 
	9.4. Mergers, Consolidations, Sales of Assets and Acquisitions
	 	 	 	 	 	 	40	 
	9.5. Conduct of Business
	 	 	 	 	 	 	40	 
	9.6. Restricted Payments and Restricted Investments
	 	 	 	 	 	 	41	 
	9.7. Issuance of Stock by Subsidiaries
	 	 	 	 	 	 	41	 
	9.8. Transactions with Affiliates
	 	 	 	 	 	 	41	 
	9.9. Operating Leases
	 	 	 	 	 	 	41	 
	9.10. Contingent Obligations
	 	 	 	 	 	 	41	 
	9.11. Limitation on Dividend Restrictions Affecting Subsidiaries
	 	 	 	 	 	 	42	 






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TABLE OF CONTENTS

(Not Part of Agreement)




	 	 	 	 	 	 	 	 	 
	Section                                                                           
                                Heading	 	 	Page	 
	 
	9.12. Compliance with ERISA
	 	 	 	 	 	 	42	 
	9.13. Litigation
	 	 	 	 	 	 	43	 
	9.14. Accounting Changes
	 	 	 	 	 	 	43	 
	9.15. No Amendments to Certain Other Documents
	 	 	 	 	 	 	43	 
	Section 10. Financial Covenants
	 	 	 	 	 	 	43	 
	10.1. Fixed Charge Coverage Ratio
	 	 	 	 	 	 	43	 
	10.2. Capital Expenditures
	 	 	 	 	 	 	44	 
	10.3. Leverage Ratio
	 	 	 	 	 	 	44	 
	10.4. Minimum EBITDA
	 	 	 	 	 	 	44	 
	Section 11. Events of Default
	 	 	 	 	 	 	44	 
	11.1. Events of Default; Remedies
	 	 	 	 	 	 	44	 
	11.2. Suits for Enforcement
	 	 	 	 	 	 	46	 
	11.3. Remedies Cumulative
	 	 	 	 	 	 	47	 
	11.4. Remedies Not Waived
	 	 	 	 	 	 	47	 
	Section 12. Put Right
	 	 	 	 	 	 	47	 
	Section 13. Miscellaneous
	 	 	 	 	 	 	47	 
	13.1. Amendment and Waiver
	 	 	 	 	 	 	47	 
	13.2. Expenses
	 	 	 	 	 	 	48	 
	13.3. Survival of Representations and Warranties
	 	 	 	 	 	 	48	 
	13.4. Successors and Assigns
	 	 	 	 	 	 	48	 
	13.5. Notices
	 	 	 	 	 	 	49	 
	13.6. Indemnification
	 	 	 	 	 	 	50	 
	13.7. Confidentiality
	 	 	 	 	 	 	51	 
	13.8. Punitive Damages
	 	 	 	 	 	 	52	 
	13.9. Integration and Severability
	 	 	 	 	 	 	52	 
	13.10. Counterparts
	 	 	 	 	 	 	52	 
	13.11. Governing Law
	 	 	 	 	 	 	52	 
	13.12. Submission to Jurisdiction; Waiver of Service and Venue
	 	 	 	 	 	 	52	 
	13.13. Waiver of Right to Trial by Jury
	 	 	 	 	 	 	53	 
	Section 14. Replacement of Shares
	 	 	 	 	 	 	53	 











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SCHEDULES




	 	 	 

	Schedule 1.1

	 	Owned and Leased Properties
	Schedule 3.1

	 	Consents
	Schedule 3.2(a)

	 	Good Standing
	Schedule 3.2(b)

	 	Subsidiaries
	Schedule 3.3

	 	Taxes
	Schedule 3.6

	 	(OSHA and Environmental Compliance)
	Schedule 3.5

	 	Entity Names
	Schedule 3.7(b)

	 	Litigation
	Schedule 3.7(d)

	 	Plan Contributions
	Schedule 3.8

	 	Intellectual Property
	Schedule 3.9

	 	Licenses and Permits
	Schedule 3.11

	 	Defaults
	Schedule 3.13

	 	Labor Disputes
	Schedule 3.21

	 	Business
	Schedule 3.22

	 	Insurance
	Schedule 3.25

	 	SEC Filings
	Schedule 9.10(d)

	 	Contingent Obligations






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EXHIBITS




	 	 	 

	Exhibit A-1

	 	Purchaser Warrant
	Exhibit A-2

	 	Control Warrant
	Exhibit B

	 	Compliance Certificate
	Exhibit D

	 	Registration Rights Agreement
	Exhibit E

	 	Senior Series A Certificate of Designations
	Exhibit F

	 	Legal Opinion
	Exhibit G

	 	Initial Budget
	Exhibit H

	 	Parent Series B Certificate of Designations
	Exhibit 3.4(a)

	 	Pro Forma Balance Sheet
	Exhibit 3.4(b)

	 	Projections







-i-











 





PREFERRED STOCK AND WARRANT PURCHASE AGREEMENT



PREFERRED STOCK AND WARRANT PURCHASE AGREEMENT, dated as of November 23, 2010 (this “Agreement”),
by and among NYTEX ENERGY HOLDINGS, INC., a Delaware corporation (“Parent”), NYTEX FDF ACQUISITION,
INC., a Delaware corporation (the “Company”), and WayPoint Nytex, LLC, a Delaware limited liability
company (together with its successors and assigns, the “Purchaser”).




RECITALS



WHEREAS, (a) the Company wishes to issue and sell to the Purchaser, and the Purchaser wishes to
purchase from the Company, 20,750 shares of the Company’s 14% Senior Series A Redeemable Preferred
Stock, par value $0.001 per share (the “Senior Series A Redeemable Preferred Stock”), and (b)
Parent wishes to issue and sell to the Purchaser, and the Purchaser wishes to purchase from Parent,
(i) a warrant, in the form of Exhibit A-1 attached hereto (the “Purchaser Warrant”), and (ii) a
warrant, in the form of Exhibit A-2 attached hereto (the “Control Warrant”, and together with the
Purchaser Warrant, the “Warrants”), all for the consideration and upon the terms and conditions
hereinafter provided; and



WHEREAS, Parent wishes to issue and sell to the Purchaser, and the Purchaser wishes to purchase
from Parent, one (1) share of Parent’s Series B Redeemable Preferred Stock, par value $0.001 per
share (the “Series B Redeemable Preferred Stock”).



NOW, THEREFORE, in consideration of the foregoing and the mutual covenants, representations and
warranties and agreements made herein, and other good and valuable consideration the receipt and
sufficiency of which hereby are acknowledged, the parties hereto, intending to be legally bound,
agree as follows:




     Section 1. Definitions.



     1.1. Defined Terms. For the purposes of this Agreement, the following terms shall
have the following respective meanings:



     “Accountants” means the nationally or regionally recognized firm of independent certified
public accountants mutually agreed upon in writing by the Company and the Purchaser.



     “Acquisition Agreement” means that certain Membership Interests Purchase Agreement (including
all annexes, exhibits and schedules relating thereto), dated as of November 23, 2010, among the
Company and the Francis Entities, in form and substance satisfactory to the Purchaser.



     “Affiliate” means, as to any Person, (a) any Person which, directly or indirectly, is in
control of, is controlled by, or is under common control with such Person, or (b) any Person who is
a director, managing member, general partner or officer (i) of such Person, (ii) of any Subsidiary
of such Person or (iii) of any Person described in clause (a) above. For purposes of this
definition, control of a Person shall mean the power, direct or indirect, (x) to vote 5% or more of
the Equity Interests having ordinary voting power for the election of directors of such Person or
other Persons performing similar functions for any such Person, or (y) to direct or



-1-









 




cause the direction of the management and policies of such Person whether by ownership of
Equity Interests, contract or otherwise.




     “Anti-Terrorism Laws” means any Applicable Laws relating to terrorism or money laundering,
including Executive Order No. 13224, the USA PATRIOT Act, the Applicable Laws comprising or
implementing the Bank Secrecy Act, and the Applicable Laws administered by the United States
Treasury Department’s Office of Foreign Asset Control (as any of the foregoing Applicable Laws may
from time to time be amended, renewed, extended, or replaced).



     “Applicable Law” means all laws, rules and regulations applicable to the Person, conduct,
transaction, covenant, Transaction Document or contract in question, including all applicable
common law and equitable principles; all provisions of all applicable state, federal and foreign
constitutions, statutes, rules, regulations, treaties, directives and orders of any Governmental
Authority, and all orders, judgments and decrees of all courts and arbitrators.



     “Bankruptcy Code” means 11 U.S.C. Sec. 101 et seq., as from time to time hereafter amended,
and any successor or similar statute.



     “Blocked Person” has the meaning set forth in Section 3.23(b).



     “Budget” for any fiscal year means an annual operating budget of the NYTEX Parties, on both a
consolidated and consolidating basis, (a) for such fiscal year, containing projections of profit
and loss, cash flow and ending balance sheets for each month of such fiscal year, and (b) for the
succeeding three years, containing projections of profit and loss, cash flow and ending balance
sheets for each of such years; and thereafter, promptly upon preparation thereof, all amendments
and revisions thereto which may be made from time to time. The initial Budget effective on the
date of this Agreement is attached hereto as Exhibit G.



     “Business” means, with respect any NYTEX Party, such NYTEX Party’s business as conducted on
the Closing Date;



     “Business Day” means any day except a Saturday, a Sunday or a legal holiday in New York City.



     “Capital Expenditures” means expenditures made or liabilities incurred for the acquisition of
any fixed assets or improvements, replacements, substitutions or additions thereto which have a
useful life of more than one year, including the total principal portion of Capitalized Lease
Obligations, which, in accordance with GAAP, would be classified as capital expenditures.



     “Capitalized Lease” means, as to any Person, any lease of any property (whether real, personal
or mixed) by such Person as lessee that, in accordance with GAAP, is or is required to be accounted
for as a capital lease on the balance sheet of such Person.



     “Capitalized Lease Obligation” means any Indebtedness of any NYTEX Party represented by
obligations under a lease that is required to be capitalized for financial reporting purposes in
accordance with GAAP.



-2-









 





     “Cash” means money (in Dollars), currency (in Dollars) or a credit balance in any Deposit
Account.



     “Cash Equivalents” means



     (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United
States Government or issued by any agency thereof and backed by the full faith and credit of the
United States of America, in each case maturing within one year from the date of acquisition
thereof;



     (b) commercial paper of an issuer rated at least A-1 by S&P or P-1 by Moody’s, or (if both
of the two named rating agencies cease publishing ratings of commercial paper issuers generally)
carrying an equivalent rating by a nationally recognized statistical rating organization, which is
issued by a Person (other than the Company or an Affiliate of the Company) organized under the laws
of any state of the United States or of the District of Columbia, and matures within nine months
after the date of acquisition thereof;



     (c) certificates of deposit or bankers’ acceptances maturing not more than one year after
the date of acquisition thereof; and



     (d) repurchase obligations of any bank, having a term of not more than 30 days, for, and
secured by, underlying securities of the types (without regard to maturity) described in clauses
(a) and (c) above.



     “CERCLA” means the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, 42 U.S.C. §§9601 et seq.



     “Certified” when used with respect to any financial information of any Person to be certified
by any of its officers, indicates that such information is to be accompanied by a certificate to
the effect that such financial information has been prepared in accordance with GAAP consistently
applied, subject in the case of interim financial information to normal year end audit adjustments
and absence of the footnotes required by GAAP, and presents fairly, in all material respects, the
information contained therein as at the dates and for the periods covered thereby.



     “Change of Control” means, and shall be deemed to have occurred, if at any time:



     (a) all or substantially all of the outstanding shares of capital stock of any NYTEX Party
shall be transferred or sold or such NYTEX Party shall merge or consolidate with another person or
entity, in each case, in one or a series of related transactions, under circumstances in which the
holders (together with the Affiliates of such holders) of the voting power of outstanding capital
stock of such NYTEX Party, as applicable, immediately prior to such transaction, own less than 50%
in voting power of the outstanding capital stock of such NYTEX Party, as applicable, or the
surviving or resulting corporation or acquirer, as the case may be, immediately following such
transaction; or



-3-









 





     (b) there shall occur a sale or other Disposition of all or substantially all of the
assets of any NYTEX Party (whether such sale or other Disposition occurs pursuant to a single
transaction or a series of related transactions), or a voluntary or involuntary liquidation,
dissolution or winding up of any NYTEX Party (including any transaction or series of related
transactions or event that is deemed to be a liquidation, dissolution or winding up of such NYTEX
Party pursuant to any provision of its Organizational Documents),



     (c) Either Michael K. Galvis or Michael G. Francis shall sell at least five percent (5%)
of Parent’s Equity Interests held by him immediately prior to such sale;



     (d) Michael K. Galvis ceases to be employed as the Chief Executive Officer of Parent or
otherwise dies or becomes disabled and, in any case, shall not have been replaced within thirty
(30) calendar days by an interim Chief Executive Officer, and within one hundred eighty (180) days
by a permanent Chief Executive Officer, each to have similar experience and qualifications as the
Chief Executive Officer being replaced and to be otherwise satisfactory to the Purchaser in its
reasonable discretion, or any such replacement Chief Executive Officer ceases such employment or
otherwise dies or becomes disabled unless replaced in the same time period and with an individual
having similar experience and qualifications as the Chief Executive Officer being replaced and to
be otherwise satisfactory to the Purchaser in its reasonable discretion; or



     (e) Michael G. Francis ceases to be employed as the Chief Executive Officer of the Francis
Entities or otherwise dies or becomes disabled and, in any case, shall not have been replaced
within thirty (30) calendar days by an interim Chief Executive Officer, and within one hundred
eighty (180) days by a permanent Chief Executive Officer, each to have similar experience and
qualifications as the Chief Executive Officer being replaced and to be otherwise satisfactory to
the Purchaser in its reasonable discretion, or any such replacement Chief Executive Officer ceases
such employment or otherwise dies or becomes disabled unless replaced in the same time period and
with an individual having similar experience and qualifications as the Chief Executive Officer
being replaced and to be otherwise satisfactory to the Purchaser in its reasonable discretion



     “Charges” means all taxes, charges, fees, imposts, levies or other assessments, including all
net income, gross income, gross receipts, sales, use, ad valorem, value added, transfer, franchise,
profits, inventory, capital stock, license, withholding, payroll, employment, social security,
unemployment, excise, severance, stamp, occupation and property taxes, custom duties, fees,
assessments, liens, claims and charges of any kind whatsoever, together with any interest and any
penalties, additions to tax or additional amounts, imposed by any taxing or other authority,
domestic or foreign (including the Pension Benefit Guaranty Corporation or any environmental agency
or superfund), of any NYTEX Party or any of Affiliate (other than the Purchaser) thereof.



     “Closing Date” has the meaning set forth in Section 2.3.



     “Closing Fee” has the meaning set forth in Section 2.1(c).



     “Code” means the Internal Revenue Code of 1986, as the same may be amended or supplemented
from time to time, and any successor statute of similar import, and the rules and regulations
thereunder, as from time to time in effect.



-4-









 





     “Company” has the meaning set forth in the preamble.



     “Compliance Certificate” means, for any fiscal quarter of the Company, an Officer’s
Certificate of the Company properly completed as of the last day of such fiscal quarter and signed
by the Chief Financial Officer of the Company, substantially in the form set forth in Exhibit B
attached hereto.



     “Confidential Information” has the meaning set forth in Section 13.7.



     “Consents” means all filings and all licenses, permits, consents, approvals, authorizations,
qualifications and orders of Governmental Authorities and other third parties, domestic or foreign,
necessary to carry on any NYTEX Party’s business or necessary (including to avoid a conflict or
breach under any agreement, instrument, other document, license, permit or other authorization) for
the execution, delivery or performance of this Agreement, the other Transaction Documents, the
Senior Debt Documents, the Subordinated Debt Documents or the Acquisition Agreement, including any
Consents required under all applicable federal, state or other Applicable Law.



     “Contingent Obligation” means, as to any Person, any direct or indirect liability of that
Person, with or without recourse, guaranteeing or intended to guarantee any Indebtedness, lease,
dividend or other monetary obligation (the “primary obligation”) of another Person (the “primary
obligor”) in any manner, including any obligation of that Person (a) to purchase, repurchase or
otherwise acquire such primary obligation or any security therefor, (b) to advance or provide funds
for the payment or discharge of any such primary obligation or to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or solvency or any
balance sheet item, level of income or financial condition of the primary obligor, (c) to purchase
property, securities or services primarily for the purpose of assuring the owner of any such
primary obligation of the ability of the primary obligor to make payment of such primary obligation
or (d) otherwise to assure or hold harmless the holder of any such primary obligation against loss
in respect thereof. The amount of any Contingent Obligation shall be deemed equal to the stated or
determinable amount of the primary obligation in respect of which such Contingent Obligation is
made or, if not stated or if indeterminable, the maximum reasonably anticipated liability in
respect thereof (assuming such Person is required to perform thereunder), as determined by such
Person in good faith. Notwithstanding the foregoing, the term “Contingent Obligation” shall not
include endorsements of instruments for deposit or collection in the Ordinary Course of Business.



     “Control Warrant” has the meaning set forth in the preamble.



     “Controlled Group” means, at any time, each NYTEX Party and all members of a controlled group
of corporations and all trades or businesses (whether or not incorporated) under common control and
all other entities which, together with any NYTEX Party, are treated as a single employer under
Section 414 of the Code.



     “Debt Payments” means and includes, for any period and calculated for the Company and its
Subsidiaries on a consolidated basis, the sum of (without duplication) (a) all amounts actually
incurred and payable during such period for interest on any Advances (as defined in the



-5-









 




Senior Debt Documents), Indebtedness, and the interest portion of any amount incurred under
any Capitalized Lease Obligation and any Synthetic Lease, plus (b) all amounts incurred and payable
for all fees, commissions and charges under this Agreement and with respect to any Advances, Funded
Debt or other Indebtedness for borrowed money, plus (c) scheduled principal payments under any
Capitalized Lease Obligation and any Synthetic Lease, plus (d) unscheduled principal payments paid
during the period under any Capitalized Lease Obligations and any Synthetic Lease, plus (e)
scheduled principal payments made with respect to any Funded Debt or other Indebtedness for
borrowed money (other than the repayment of Revolving Advances (as defined in the Senior Debt
Documents)), regardless to whom such amounts are payable, plus (f) unscheduled principal payments
with respect to any Funded Debt or other Indebtedness for borrowed money (other than the repayment
of Revolving Advances), regardless to whom such amounts are payable.




     “Default” means any event or condition which, with due notice or lapse of time or both, would
become an Event of Default.



     “Deposit Account” means a deposit account, as such term is defined in Section 9-102 of the
Uniform Commercial Code.



     “Derivative Securities” means (i) all shares of stock and other securities that are
convertible into or exchangeable or exercisable for shares of Parent Common Stock, and (ii) all
options, warrants, and other rights to acquire shares of Parent Common Stock or any class of stock
or other security or securities convertible into or exchangeable for shares of Parent Common Stock
or any class of stock of other security.



     “Dispose” means, with respect to any assets or property of any Person, to sell, convey,
transfer, exchange, lease, encumber (other than pursuant to transactions occurring on the date
hereof) or otherwise dispose of, such assets or property (including any involuntary disposition by
eminent domain or otherwise), and “Disposition” has a corresponding meaning.



     “Dollars” and “$” means lawful money of the United States of America.



     “Earnings Before Interest and Taxes” means, for any period, net income (or loss) of the
Company and its Subsidiaries on a consolidated basis for such period (excluding one-time non-cash
gains and non-cash losses) plus the following to the extent deducted in calculating such net income
(or loss): (i) all interest expense of the Company and its Subsidiaries on a consolidated basis for
such period, and (ii) all charges against income of the Company and its Subsidiaries on a
consolidated basis for such period for federal, state and local taxes.



     “EBITDA” means, for any period, Earnings Before Interest and Taxes for such period plus the
following for the Company and its Subsidiaries on a consolidated basis to the extent deducted in
calculating net income (or loss) for such period: (i) depreciation expenses for such period and (i)
amortization expenses for such period.



     “Environmental Laws” means all federal, state and local environmental, land use, zoning,
health, chemical use, safety and sanitation laws, statutes, ordinances and codes relating to the
protection of the environment and/or governing the use, storage, treatment, generation,



-6-









 




transportation, processing, handling, production or disposal of Hazardous Substances and the
rules, regulations, policies, guidelines, interpretations, decisions, orders and directives of
federal, state and local governmental agencies and authorities with respect thereto.




     “Environmental Matter” means any claim, investigation, litigation or administrative
proceeding, whether pending or threatened, or Order, asserted, arising or entered under or pursuant
to any Environmental Law, or relating to any Hazardous Materials, in each case against or affecting
the Company or any of its Subsidiaries, their respective operations, or any properties owned,
leased or used by any of them.



     “Environmental Permit” means all licenses, permits, authorizations and registrations required
to be obtained by any NYTEX Party under any applicable Environmental Law and necessary for its
operations.



     “Equipment” means and includes as to each NYTEX Party all of such NYTEX Party’s goods (other
than Inventory) whether now owned or hereafter acquired and wherever located including all
equipment, machinery, apparatus, motor vehicles, fittings, furniture, furnishings, fixtures, parts,
accessories and all replacements and substitutions therefore or accessions thereto.



     “Equity Documents” means all documents executed in connection with the issuance of the
Company’s Equity Interests to Parent on or immediately prior to the Closing Date, including
membership certificates, if any.



     “Equity Interests” means (a) with respect to any Person that is a corporation, any and all
shares, interests, participations or other equivalents (however designated and whether voting or
nonvoting) of capital stock, including each class of common stock and preferred stock of such
Person, and (b) with respect to any Person that is not a corporation, any and all general
partnership interests, limited partnership interests, membership or limited liability company
interests, beneficial interests or other equity interests of or in such Person (including any
common, preferred or other interest in the capital or profits of such Person, and whether or not
having voting or similar rights).



     “Equity Value” means the value of all of Parent’s equity as determined by a nationally
recognized independent accounting firm mutually agreed upon by Parent and the Purchaser.



     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to
time and the rules and regulations promulgated thereunder.



     “ERISA Affiliate” means any trade or business (whether or not incorporated) under common
control with the Company within the meaning of Section 414(b), 414(c), 414(m) or 414(o) of the Code
or Section 4001 of ERISA.



     “ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by
the Company or any ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a
plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA); (c) a
complete or partial withdrawal by the Company or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in



-7-









 




reorganization; (d) the filing of a notice of intent to terminate, the treatment of a plan
amendment as a termination under Section 4041 or 4041A of ERISA or the commencement of proceedings
by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) a failure by the Company or any
ERISA Affiliate to make required contributions to a Pension Plan or Multiemployer Plan; (f) an
event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Pension Plan or Multiemployer Plan; (g) the
imposition of any liability under Title IV of ERISA, other than PBGC premiums due but not
delinquent under Section 4007 of ERISA, upon the Company or any ERISA Affiliate; (h) an application
for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code
with respect to any Plan; (i) a non-exempt prohibited transaction occurs with respect to any Plan
for which any NYTEX Party may be directly or indirectly liable; or (j) a violation of the
applicable requirements of Section 404 or 405 of ERISA or the exclusive benefit rule under Section
401(a) of the Code by any fiduciary or disqualified person with respect to any Plan for which the
Company or any ERISA Affiliate may be directly or indirectly liable.




     “Event of Default” has the meaning set forth in Section 11.1.



     “Executive Order No. 13224” means the Executive Order No. 13224 on Terrorist Financing,
effective September 24, 2001, as the same has been, or shall hereafter be, renewed, extended,
amended or replaced.



     “Exchange Act” means as of any date the Securities Exchange Act of 1934, as amended, or any
successor federal statute from time to time in effect, and a reference to a particular section
thereof shall include a reference to the comparable section, if any, of any such successor federal
statute.



     “Fixed Charge Coverage Ratio” means and includes, with respect to any period, the ratio of (a)
(i) EBITDA minus (ii) Unfinanced Capital Expenditures made during such period, minus (iii)
distributions and dividends made during such period, minus (iv) cash taxes paid during such period,
minus (v) management fees paid and not otherwise deducted in calculating net income (loss) during
such period to (b) (i) all Debt Payments plus (ii) all payments of Subordinated Debt made during
such period. For purposes of determining the Fixed Charge Coverage Ratio, Unfinanced Capital
Expenditures shall include Capital Expenditures that are financed under Revolving Advances (as
defined in the Senior Debt Documents) made pursuant to the Senior Debt Documents.



     “Francis Entities” means Francis Oaks, LLC, a Louisiana limited liability company, and Francis
Drilling Fluids, Ltd., a Louisiana corporation.



     “Francis Subordinated Debt” means and includes all liabilities, loans, debts and other
obligations of any NYTEX Party under the Francis Subordinated Debt Documents.



     “Francis Subordinated Debt Documents” means (a) the Subordinated Promissory Note issued by
Parent in favor of Diana Istre Francis dated November 23, 2010 in the principal sum of $750,000 and
(ii) all other agreements, instruments and documents executed by a NYTEX Party pursuant thereto, in
each case, as amended, amended and restated, refinanced, extended,



-8-









 




supplemented and/or otherwise modified from time to time in accordance with the Francis Note
Subordination Agreement.




     “Fully-Diluted Basis” means all of the outstanding shares of Parent Common Stock, assuming the
exercise of all outstanding warrants and the exercise or conversion of all outstanding Derivative
Securities.



     “Funded Debt” means, with respect to any Person, without duplication, all Indebtedness for
borrowed money evidenced by notes, bonds, debentures, or similar evidences of Indebtedness that by
its terms matures more than one year from, or is directly or indirectly renewable or extendible at
such Person’s option under a revolving credit or similar agreement obligating the lender or lenders
to extend credit over a period of more than one year from the date of creation thereof, and
specifically including Capitalized Lease Obligations, current maturities of long-term debt,
revolving credit and short term debt extendible beyond one year at the option of the debtor, and
also including, in the case of the Company, the Obligations and, without duplication, Indebtedness
consisting of guaranties of Funded Debt of other Persons.



     “GAAP” means generally accepted accounting principles as in effect from time to time in the
United States of America, applied on a consistent basis both as to classification of items and
amounts.



     “Governmental Authority” means any nation or government, any state or other political
subdivision thereof or any entity, authority, agency, division or department exercising the
legislative, judicial, regulatory or administrative functions of or pertaining to a government.



     “Hazardous Substance” means, without limitation, any flammable explosives, radon, radioactive
materials, asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls, petroleum and
petroleum products, methane, hazardous materials, Hazardous Wastes, hazardous or Toxic Substances
or related materials as defined in CERCLA, the Hazardous Materials Transportation Act, as amended
(49 U.S.C. Sections 1801, et seq.), RCRA, Articles 15 and 27 of the New York State Environmental
Conservation Law or any other applicable Environmental Law and in the regulations adopted pursuant
thereto.



     “Hazardous Wastes” means all waste materials subject to regulation under CERCLA, RCRA or
applicable state law, and any other applicable federal and state laws now in force or hereafter
enacted relating to hazardous waste disposal.



     “Indebtedness” with respect to any Person at a particular date means all obligations of such
Person which in accordance with GAAP would be classified upon a balance sheet as liabilities
(except capital stock and surplus earned or otherwise) and in any event, without limitation, by
reason of enumeration, shall include all indebtedness, debt and other similar monetary obligations
of such Person whether direct or guaranteed, and all premiums, if any, due at the required
prepayment dates of such indebtedness, and all indebtedness secured by a Lien on assets owned by
such Person, whether or not such indebtedness actually shall have been created, assumed or incurred
by such Person. Any indebtedness of such Person resulting from the acquisition by such Person of
any assets subject to any Lien shall be deemed, for the purposes



-9-









 




hereof, to be the equivalent of the creation, assumption and incurring of the indebtedness
secured thereby, whether or not actually so created, assumed or incurred.




     “Intellectual Property” means property constituting under any Applicable Law a patent, patent
application, copyright, trademark, service mark, trade name, trade name application, domain name,
domain name application, mask work, trade secret or license or other right to use any of the
foregoing.



     “Internal Revenue Service” means the United States Internal Revenue Service and any successor
or similar agency performing similar functions.



     “Inventory” means and includes as to each NYTEX Party all of such NYTEX Party’s now owned or
hereafter acquired goods, merchandise and other personal property, wherever located, to be
furnished under any consignment arrangement, contract of service or held for sale or lease, all raw
materials, work in process, finished goods and materials and supplies of any kind, nature or
description which are or might be used or consumed in such NYTEX Party’s business or used in
selling or furnishing such goods, merchandise and other personal property, and all documents of
title or other documents representing them.



     “Investment” when used with reference to any investment of any NYTEX Party means any
investment so classified under GAAP, and, whether or not so classified, includes (a) any
Indebtedness owed by any Person to such NYTEX Party, (b) any Contingent Obligation of such NYTEX
Party with respect to Indebtedness or other obligations of any Person, and (c) any Equity Interests
in any Person held by such NYTEX Party; and the amount of any Investment shall be the original
principal or capital amount thereof less all cash returns of principal or equity thereof (and
without adjustment by reason of the financial condition of such other Person).



     “Leverage Ratio” means, as of any date of determination, the ratio of (a) Funded Debt as of
such date to (b) EBITDA for the period of the four fiscal quarters most recently ended;
provided that for purposes of calculating the Leverage Ratio (i) for the one fiscal quarter
ending November 30, 2010, EBITDA shall be measured for such one fiscal quarter multiplied
by four, (ii) for the two fiscal quarters ending February 28, 2011, EBITDA shall be measured for
such two fiscal quarters multiplied by two, and (iii) for the three fiscal quarters ending
May 31, 2011, EBITDA shall be measured for such three fiscal quarters multiplied by 4/3.



     “Lien” means any mortgage, deed of trust, pledge, hypothecation, assignment, security
interest, lien (whether statutory or otherwise), Charge, claim or encumbrance, or preference,
priority or other security agreement or preferential arrangement held or asserted in respect of any
asset of any kind or nature whatsoever including any conditional sale or other title retention
agreement, any lease having substantially the same economic effect as any of the foregoing, and the
filing of, or agreement to give, any financing statement under the Uniform Commercial Code or
comparable law of any jurisdiction.



     “Management Fee” means and includes all liabilities, debts and other obligations of any NYTEX
Party under the Management Fee Documents, not to exceed $750,000 in the aggregate during any fiscal
year of the Company.



-10-









 





     “Management Fee Documents” means (a) the Management Fee Agreement, dated November 23, 2010, by
and between the Company and Parent (b) all other agreements, instruments and documents executed by
a NYTEX Party pursuant thereto, in each case, as amended, amended and restated, refinanced,
extended, supplemented and/or otherwise modified from time to time in accordance with this
Agreement.



     “Material Adverse Effect” means a material adverse effect on (a) the condition (financial or
otherwise), results of operations, assets, business, or properties of any NYTEX Party, or (b) the
Company’s ability to duly and punctually pay or perform the Obligations under the Transaction
Documents in accordance with the terms thereof.



     “Material Contract” means any agreement or contract (including licenses, supply agreements,
requirements contracts, customer agreements, franchise agreements, distribution agreements, joint
venture agreements, asset purchase agreements, stock purchase agreements, merger agreements, agency
or advertising agreements, leases of real or personal property, credit agreements, loan agreements,
security agreements, mortgages, trust deeds, trust indentures, shareholder agreements, registration
rights agreements, consulting agreements, management agreements, employment agreements, severance
agreements, collective bargaining agreements, tax sharing agreements, and other contracts,
agreements and commitments) to which the Company or any of its Subsidiaries is a party and which
involves obligations (contingent or otherwise) of, or payments to, any NYTEX Party of more than
$500,000 in any fiscal year or is otherwise material to the ongoing business, operations, financial
condition or prospects of the NYTEX Parties taken as a whole.



     “Maturity Date” means May 23, 2016.



     “Moody’s” means Moody’s Investors Service, Inc. and any successor that is a nationally
recognized statistical rating organization.



     “Multiemployer Plan” means a “multiemployer plan” as defined in Sections 3(37) and 4001(a)(3)
of ERISA.



     “Multiple Employer Plan” means a Plan which has two or more contributing sponsors (including
any NYTEX Party or any member of the Controlled Group) at least two of whom are not under common
control, as such a plan is described in Section 4064 of ERISA.



     “NYTEX Parties” means Parent, the Company and the Company’s Subsidiaries, including the
Francis Entities.



     “Obligations” means all of the Indebtedness, obligations and liabilities of the NYTEX Parties
incurred under the Transaction Documents, whether now existing or hereafter created or arising,
direct or indirect, matured or unmatured, and whether absolute or contingent, joint, several or
joint and several, and no matter how the same may be evidenced or shall arise, including (a) the
obligation to pay principal, interest (including interest accruing after the commencement of any
proceeding referred to in Section 11.1(e) or (f), whether or not allowed as a claim in such
proceeding), charges (including redemption charges, if any), expenses, fees, attorneys’ fees and
disbursements, indemnities and other amounts payable by or chargeable to



-11-









 




any NYTEX Party under any Transaction Document and (b) the obligations of any NYTEX Party to
reimburse any amount in respect of any of the foregoing that Purchaser, in its sole discretion, may
elect to pay or advance on behalf of any NYTEX Party.




     “Observer” has the meaning set forth in Section 7.2.



     “Officer’s Certificate” means with respect to any corporation or other entity, a certificate
signed by a Responsible Officer of the specified corporation or entity.



     “Order” means any order, writ, injunction, decree, judgment, award, determination or written
direction or demand of any court, arbitrator or Governmental Authority.



     “Ordinary Course of Business” means with respect to any NYTEX Party, the ordinary course of
such NYTEX Party’s business as conducted on the Closing Date.



     “Organizational Documents” means (a) with respect to any corporation, the certificate of
incorporation, articles of incorporation or comparable constitutional or charter document, and
by-laws, of such corporation, (b) with respect to any limited liability company, the certificate of
formation or comparable document filed with the Secretary of State or comparable official of the
state of organization of such limited liability company, and the operating agreement, limited
liability company agreement or comparable constitutive document thereof, (c) with respect to any
limited partnership, the certificate of limited partnership or comparable document filed with the
Secretary of State or comparable official of the state of organization of such limited partnership
and the limited partnership agreement thereof, (d) with respect to any general partnership or joint
venture, the partnership agreement or joint venture agreement relating thereto, (e) with respect to
any trust, the trust agreement or comparable agreement establishing such trust, or (f) with respect
to any other business entity, the comparable constitutive documents, in each case with all
amendments, modifications and supplements thereto from time to time executed or filed.



     “Parent” has the meaning set forth in the preamble.



     “Parent Certificate Amendment” has the meaning set forth in Section 2.1(b).



     “Parent Common Stock” means the Common Stock, par value $0.001 per share, of Parent.



     “Parent Series B Certificate of Designations” has the meaning set forth in Section 2.1(b).



     “Parent Series B Preferred Stock” means Parent’s Series B Preferred Stock, $0.001 par value
per share.



     “Parent Series B Share” has the meaning set forth in Section 2.2(b).



     “PBGC” means the Pension Benefit Guaranty Corporation, and any successor agency or
Governmental Authority performing similar functions.



-12-









 





     “Pension Plan” means at any time any employee pension benefit plan (including a Multiple
Employer Plan, but not a Multiemployer Plan) which is covered by Title IV of ERISA or is subject to
the minimum funding standards under Section 412 of the Code and either (a) is maintained by any
member of the Controlled Group for employees of any member of the Controlled Group or (b) has at
any time within the preceding five years been maintained by any entity which was at such time a
member of the Controlled Group for employees of any entity which was at such time a member of the
Controlled Group.



     “Permitted Liens” has the meaning set forth in Section 9.2.



     “Person” means and includes an individual, a corporation, a partnership, an association, a
joint venture, a limited liability company, a trust, a syndicate, an unincorporated organization
and a Governmental Authority.



     “Plan” means any employee benefit plan within the meaning of Section 3(3) of ERISA (including
a Pension Plan), maintained for employees of any NYTEX Party or any member of the Controlled Group
or any such Plan to which any NYTEX Party or any member of the Controlled Group is required to
contribute on behalf of any of its employees.



     “Preferred Equity Interests” means, with respect to any Person, any class of capital stock or
other Equity Interests of such Person which is entitled to a preference or priority over any other
class of Equity Interests of such Person with respect to any distribution of such Person’s assets,
whether upon the declaration or payment of dividends, or upon liquidation or dissolution, or
otherwise.



     “Principal Amount” has the meaning set forth in Section 2.1.



     “Pro Forma Balance Sheet” has the meaning set forth in Section 3.4(a).



     “Pro Forma Financial Statements” has the meaning set forth in Section 3.4(b).



     “Projections” has the meaning set forth in Section 3.4(b).



     “Purchase Price” has the meaning set forth in Section 2.2.



     “Purchaser” has the meaning set forth in the preamble.



     “Purchaser Warrant” has the meaning set forth in the preamble.



     “Put Election Notice” has the meaning set forth in Section 12.



     “Put Event Date” has the meaning set forth in Section 12.



     “Put Payment Amount” has the meaning set forth in Section 12.



     “Put Securities” has the meaning set forth in Section 12.



-13-









 





     “RCRA” means the Resource Conservation and Recovery Act, 42 U.S.C. §§ 6901 et seq., as same
may be amended from time to time.



     “Real Property” means all of each NYTEX Party’s right, title and interest in and to the owned
and leased premises identified on Schedule 1.1 or which is hereafter owned or leased by any NYTEX
Party.



     “Records” means all of the NYTEX Parties’ right, title and interest in all of their respective
books, records, ledger sheets, invoices, files, tapes, cards, computer runs, computer programs,
computer files and other data and documents, including records in any form (digital or other), and
recorded in or through any tangible medium (magnetic, lasergraphic or other) and retrievable in
perceivable form, together with all machinery and processes (including computer programming
instructions) required to read and print such records, relating to any property or assets of the
Company or its Subsidiaries.



     “Registration Rights Agreement” means a Registration Rights Agreement in the form of Exhibit D
attached hereto to be executed and delivered by the Company and the Purchaser on the Closing Date,
as from time to time amended, modified or supplemented in accordance with its terms.



     “Release” has the meaning set forth in Section 3.6(c)(i).



     “Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than
events for which the thirty (30)-day notice has been waived.



     “Responsible Officer” means, with respect to any corporation, any of the Chief Executive
Officer, the Chief Operating Officer, the Chief Financial Officer, the President, one of the Vice
Presidents, the General Counsel or the Treasurer of such corporation, and, with respect to any
partnership, limited liability company or other type of business entity, any individual performing
comparable management functions with respect to such entity.



     “Restricted Investment” means any Investment other than:



     (a) any Investment in Cash or Cash Equivalents;



     (b) any Investment existing on the Closing Date; and



     (c) any Investment by the Company in the Equity Interests of, or loan or advance to or
Contingent Obligation with respect to the obligations of, any Wholly-owned Subsidiary of the
Company, and any Investment by any Wholly-owned Subsidiary of the Company in the Equity Interests
of, or loan or advance to or Contingent Obligation with respect to the obligations of, the Company
or any other Wholly-owned Subsidiary of the Company.



     “Restricted Payment” means, with respect to any Person,



     (a) the declaration or payment of any dividend or other distribution on, or the incurrence
of any liability to make any other payment in respect of, Equity Interests of such



-14-









 




Person (other than a dividend or distribution in respect of Equity Interests that is payable
solely in Equity Interests of the same class or series of such Person);




     (b) any payment or distribution on account of the purchase, redemption, defeasance
(including in-substance or legal defeasance) or other retirement of any Equity Interests of such
Person, or of any warrant, option or other right to subscribe for or purchase such Equity Interests
(whether directly or indirectly, and including any purchase or other acquisition of such Equity
Interests, or of any warrant, option or other right to acquire such Equity Interests, by any
Subsidiary of such Person);



     (c) any other payment or distribution by such Person in respect of its Equity Interests,
whether directly or indirectly or through any Subsidiary of such Person;



     (d) any payment by any NYTEX Party of management, consulting or similar fees to any
Affiliate of such NYTEX Party (other than the Purchaser), or of fees or other compensation or
benefits to any officer, director, employee, consultant or agent of such NYTEX Party, except (i)
payments of reasonable fees, compensation and benefits consistent with past practice (including
annual increases in compensation and bonuses), and provision of reasonable indemnification, to such
officers, employees, consultants and agents for actual services rendered to such NYTEX Party in the
Ordinary Course of Business, all as determined by the board of directors or senior management of
Parent in good faith, and (ii) payments to directors of such NYTEX Party of reasonable fees for
service in such capacity consistent with past practice and reimbursement of actual out-of-pocket
expenses incurred in connection with attending meetings of the boards of directors of such NYTEX
Party and committees thereof, and provision of reasonable indemnification to such directors, all as
determined by the board of directors of the applicable NYTEX Party in good faith; and



     (e) any payment or distribution by such Person on account of the principal of or
prepayment charge, if any, or interest or other amounts, with respect to any Indebtedness of the
Company or any of its Subsidiaries which is subordinated in right of payment to the prior payment
in respect of the Shares, including the Subordinated Debt.



     The amount of any Restricted Payment made in the form of property shall be deemed to be the
greater of the fair market value or the net book value of such property.



     “Restricted Subsidiaries” means NYTEX Petroleum, Inc., Supreme Oilfield Services, Inc. and
Supreme Fluid Service Partners LLC, each of which is a Wholly-owned Subsidiary of Parent, and
Pyburn Services, Inc. and Superior Chemical Corporation, each of which is a Wholly-owned Subsidiary
of Francis Drilling Fluids, Ltd.



     “S&P” means Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., or any successor
that is a nationally recognized statistical rating organization.



     “Sale and Leaseback Transaction” means, with respect to the Company or any of its
Subsidiaries, any arrangement, directly or indirectly, with any Person whereby the Company or such
Subsidiary shall sell or transfer any property used or useful in its business, whether now owned or
hereafter acquired, and thereafter rent or lease such property or other property that it
intends to use for substantially the same purpose or purposes as the property being sold or
transferred.



-15-









 





     “SEC” means the United States Securities and Exchange Commission and any successor agency,
authority, commission or Governmental Authority.



     “SEC Reports” means the reports, documents and other filings and information made by the
Company with the SEC, including the Company’s last annual report on Form 10-K.



     “Securities Account” means, with respect to any Person, any securities account maintained by
such Person with any bank, securities broker or dealer, or other financial intermediary, in which
such bank, broker, dealer or financial intermediary either directly or through a nominee or
depository holds investment securities for the account of such Person.



     “Securities Act” means as of any date the Securities Act of 1933, as amended, or any successor
federal statute from time to time in effect, and a reference to a particular section thereof shall
include a reference to the comparable section, if any, of any such successor federal statute.



     “Senior Debt Documents” means (a) that certain Revolving Credit, Term Loan and Security
Agreement, dated as of November 23, 2010, among PNC Bank, National Association, the Company and the
Francis Entities, in the principal sum of $24,000,000 and (b) all other agreements, instruments and
documents executed by a NYTEX Party pursuant thereto, in each case, as amended, amended and
restated, refinanced, extended, supplemented and/or otherwise modified from time to time.



     “Senior Series A Certificate of Designations” has the meaning set forth in Section 2.1(a).



     “Series A Preferred Stock” means Parent’s Series A Preferred Stock, $0.001 par value per
share.



     “Series A Preferred Stock Documents” means (a) that certain Confidential Private Placement
Memorandum of Parent, dated as October 12, 2010 (the “PPM”), in respect of the issuance and sale of
the Series A Preferred Stock to certain accredited investors and (b) all other agreements,
instruments and documents executed by the parties in connection with the transactions contemplated
by the PPM.



     “Shares” has the meaning set forth in Section 2.2(a).



     “Subordinated Debt” means the Francis Subordinated Debt and the Management Fee.



     “Subordinated Debt Documents” means the Francis Subordinated Debt Documents and the Management
Fee Documents.



     “Subsidiary” of any Person means (a) any corporation with respect to which more than 50% of
the issued and outstanding Voting Equity Interests of such corporation (irrespective of whether at
the time Equity Interests of any other class or classes of such Person shall or might



-16-









 




have voting power upon the occurrence of any contingency) is at the time directly or
indirectly owned or controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person’s other Subsidiaries, or (b) any partnership or
limited liability company in which such Person and/or one or more Subsidiaries of such Person shall
have an interest (whether in the form of voting or participation in profits or capital
contribution) of more than 50% or of which any such Person is a general partner or may exercise the
powers of a general partner. The term “Subsidiaries” shall not include the Restricted
Subsidiaries.




     “Swap Contracts” means (a) any and all rate swap transactions, basis swaps, credit derivative
transactions, forward rate transactions, commodity swaps, commodity options, forward commodity
contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or
options or forward bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions, currency options,
spot contracts, or any other similar transactions or any combination of the foregoing (including
any options to enter into any of the foregoing), whether or not any such transaction is governed by
or subject to any master agreement, and (b) any and all transactions of any kind, and the related
confirmations, which are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives Association, Inc., any International
Foreign Exchange Master Agreement, or any similar master agreement, including any such obligations
or liabilities under any such master agreement or any schedule thereto.



     “Synthetic Lease” means any synthetic lease, tax retention operating lease, off-balance sheet
loan or similar off-balance sheet financing arrangement whereby the arrangement is considered
borrowed money indebtedness for tax purposes but is classified as an operating lease or does not
otherwise appear on a balance sheet under GAAP.



     “Trading with the Enemy Act” shall mean the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any enabling legislation
or executive order relating thereto.



     “Termination Event” means (a) a Reportable Event with respect to any Plan or Multiemployer
Plan; (b) the withdrawal of any NYTEX Party or any member of the Controlled Group from a Plan or
Multiemployer Plan during a plan year in which such entity was a “substantial employer” as defined
in Section 4001(a)(2) of ERISA; (c) the providing of notice of intent to terminate a Plan in a
distress termination described in Section 4041(c) of ERISA; (d) the institution by the PBGC of
proceedings to terminate a Plan or Multiemployer Plan; (e) any event or condition (i) which might
constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan or Multiemployer Plan, or (ii) that may result in termination of a
Multiemployer Plan pursuant to Section 4041A of ERISA; or (f) the partial or complete withdrawal
within the meaning of Sections 4203 and 4205 of ERISA, of any NYTEX Party or any member of the
Controlled Group from a Multiemployer Plan.



     “Transaction Documents” means this Agreement, the Shares, the Warrants, the Senior Series A
Certificate of Designations, the Parent Certificate Amendment, the Parent Series B Certificate of
Designations and the Registration Rights Agreement.



-17-









 





     “Transactions” has the meaning set forth in Section 3.4(a).



     “Unfunded Pension Liabilities” means, with respect to any Pension Plan on any date of
determination, the excess (if any) of that Pension Plan’s benefit liabilities over the current
value of that Pension Plan’s assets calculated in accordance with the definition of “amount of
unfunded benefit liabilities” as such term is described in Section 4001(a)(18) of ERISA and using,
for purposes of such calculation, the valuation rules that apply to Pension Plans placed into
trusteeship by the PBGC.



     “Uniform Commercial Code” means the Uniform Commercial Code as adopted in the State of New
York from time to time.



     “Unfinanced Capital Expenditures” means all Capital Expenditures of the NYTEX Parties other
than those made utilizing financing provided by the applicable seller or third party lenders.



     “Voting Equity Interest” means, with respect to any Person, (a) in the case of any Person
which is a corporation, any share of capital stock of such Person having the right to vote (other
than solely upon the occurrence of a contingency) with respect to the election of members of the
board of directors of such corporation, or (b) in the case of a Person which is a partnership,
limited liability company, or other entity (other than a corporation), any Equity Interest of such
Person having the right to vote for or consent to (other than solely upon the occurrence of a
contingency) the election or appointment of directors or managers (or persons performing similar
functions) of such Person, or with respect to which the holder of such Equity Interest is entitled
to manage (alone or together with holders of other such Equity Interests) the operations of such
Person.



     “Warrants” has the meaning set forth in the recitals.



     “Wholly-owned Subsidiary” means, with respect to any Person, any Subsidiary of such Person all
of the Equity Interests (and all rights and options to purchase such Equity Interests) of which,
other than directors’ qualifying shares, are owned, beneficially and of record, by such Person, or
by such Person and one or more other Wholly-owned Subsidiaries of such Person, or by one or more
other Wholly-owned Subsidiaries of such Person.



     1.2. Accounting Principles.



     (a) Unless the context otherwise clearly requires, all accounting terms not expressly
defined herein shall be construed, and all financial computations required under this Agreement
shall be made, in accordance with GAAP, consistently applied.



     (b) References herein to “fiscal year”, “fiscal quarter” and “fiscal month” refer to such
fiscal periods of the Company.



     (c) If at any time after the Closing Date any change in GAAP is occasioned by promulgation
of rules, regulations, pronouncements or opinions by or is otherwise required by the Financial
Accounting Standards Board, the American Institute of Certified Public Accountants or the Public
Company Accounting Oversight Board (or successors thereto or



-18-









 




agencies with similar functions), and such change would affect the calculation of any
financial ratio or other financial requirement set forth in this Agreement or any other Transaction
Document, then upon the request of either Parent or the Purchaser, Parent and the Purchaser shall
negotiate in good faith to amend such ratio or requirement so as to preserve the original intent
thereof in light of such change in GAAP; provided that, until so amended, (i) such
financial ratio or requirement shall continue to be computed in accordance with GAAP as in effect
immediately prior to such change therein, and (ii) the Company shall provide to the Purchaser
financial statements and other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or requirement made
before and after giving effect to such change in GAAP.




     1.3. Rules of Construction. References in this Agreement to “Articles”,
“Sections”, “Annexes”, “Exhibits” or “Schedules” shall be to Articles, Sections, Annexes, Exhibits
or Schedules of or to this Agreement unless otherwise specifically provided. Singular words shall
connote the plural as well as the singular, and vice versa (except as otherwise indicated), as may
be appropriate. “Include”, “includes” and “including” shall be deemed to be followed by “without
limitation”. Except as otherwise specified herein, references to any Person include the successors
and assigns of such Person. Unless otherwise specified, references “from” any date mean “from and
including,” and references “to” any date mean “to but not including.” References to any statute or
act shall include all related current regulations and all amendments and any successor statutes,
acts and regulations. The words “herein”, “hereof” and “hereunder” and other words of similar
import refer to this Agreement as a whole and not to any particular section or subsection.
Reference herein to any section or subsection refers to such section or subsection (as the case may
be) of this Agreement. Each covenant or agreement contained in this Agreement shall be construed
(absent express provision to the contrary) as being independent of each other covenant or agreement
contained herein, so that compliance with any one covenant or agreement shall not (absent such an
express contrary provision) be deemed to excuse compliance with any other covenant or agreement.
Where any provision of this Agreement refers to action to be taken by any Person, or which such
Person is prohibited from taking, such provision shall be applicable whether such action is taken
directly or indirectly by such Person. References herein to the “knowledge” of any Person that is
not an individual shall be deemed to refer to knowledge by a Responsible Officer of such Person.



     Section 2. Issuance and Sale of the Shares and the Warrants.



     2.1. Authorization of the Shares and the Warrants.



     (a) Authorization of the Shares. The Company has duly authorized the issuance and
sale of the Shares in the maximum aggregate amount of $20,750,000 (the “Principal Amount”). The
Company shall adopt and file with the Secretary of State of the State of Delaware, on or before the
Closing Date, the Senior Series A Certificate of Designations, in the form of Exhibit E attached
hereto (the “Senior Series A Certificate of Designations”).



     (b) Authorization of the Warrants. Parent has duly authorized the issuance and
sale of the Warrants, exercisable to purchase shares of Parent Common Stock, at an exercise price
of $.01 per share, to be exercisable in accordance with the terms thereof. Parent shall adopt and
file with the Secretary of State of the State of Delaware, on or before the Closing Date, the
Series B
Certificate of Designations, in the form of Exhibit H attached hereto (the “Parent Series B
Certificate of Designations”).



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     (c) Closing Fee. On the Closing Date, the Company shall pay to the Purchaser a
fully earned and non-refundable fee in an amount equal to three percent (3%) of the Purchase Price
(the “Closing Fee”).



     2.2. Sale and Purchase of the Shares and Warrants. On the Closing Date, subject
to the terms and conditions of this Agreement, (a) the Company hereby agrees to issue and sell to
the Purchaser, and the Purchaser hereby agrees to purchase from the Company, 20,750 shares of
Senior Series A Redeemable Preferred Stock (the “Shares”) and (b) Parent hereby agrees to issue and
sell to the Purchaser, and the Purchaser hereby agrees to purchase from Parent, one (1) share of
Parent Series B Redeemable Preferred Stock (“Parent Series B Share”) and the Warrants, for an
aggregate purchase price equal to $20,000,001 (“Purchase Price”). The parties hereto acknowledge
and agree that the purchase price for the Parent Series B Share is $1.00.



     2.3. Closing. The sale and delivery of the Shares and the Warrants to be issued
hereunder on the Closing Date shall take place at the offices of Winston & Strawn LLP, 200 Park
Avenue, New York, New York at 10:00 a.m. local time on the date hereof (or such other time and
place as the parties shall agree) (herein called the “Closing Date”). On the Closing Date, subject
to the satisfaction or waiver by the Purchaser in writing of the conditions specified in Section
5.1, the Company shall deliver to the Purchaser the Shares and Parent shall deliver to the
Purchaser the Warrants against payment of the Purchase Price (net of the amount of fees and
expenses required to be paid or reimbursed by Parent on the Closing Date pursuant to Section 2.1(c)
and Section 13.2 and not previously paid or advanced by Parent) to Parent (on behalf of itself and
the Company) by wire transfer of immediately available funds to such bank account or accounts as
Parent shall specify by written notice to the Purchaser at least two (2) Business Days prior to the
Closing Date.



     Section 3. Representations and Warranties of Parent and the Company.


Each of Parent and the Company represents and warrants that the following statements are, and after
giving effect to the transactions contemplated by the Acquisition Agreement will be, true, correct
and complete:




     3.1. Authority. Each of Parent and the Company has full power, authority and
legal right to enter into this Agreement and the other Transactions Documents to which it is a
party and to perform all its respective Obligations hereunder and thereunder. This Agreement and
the other Transaction Documents have been duly executed and delivered by Parent and the Company, as
applicable, and this Agreement and the other Transaction Documents constitute the legal, valid and
binding obligation of Parent and the Company enforceable in accordance with their terms, except as
such enforceability may be limited by any applicable bankruptcy, insolvency, moratorium or similar
laws affecting creditors’ rights generally. The execution, delivery and performance of this
Agreement and of the other Transaction Documents (a) are within Parent’s and the Company’s
corporate powers, have been duly authorized by all necessary corporate action, are not in
contravention of law or the terms of any NYTEX Party’s Organization Documents or to the conduct of
any NYTEX Party’s business or of any material



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agreement or undertaking to which any NYTEX Party is a party or by which any NYTEX Party is
bound, including the Acquisition Agreement, the Senior Debt Documents or the Subordinated Debt
Documents, (b) will not conflict with or violate any law or regulation, or any judgment, order or
decree of any Governmental Authority, (c) will not require the Consent of any Governmental
Authority or any other Person, except those Consents set forth on Schedule 3.1, all of which will
have been duly obtained, made or compiled prior to the Closing Date and which are in full force and
effect and (d) will not conflict with, nor result in any breach in any of the provisions of or
constitute a default under or result in the creation of any Lien except Permitted Liens upon any
asset of any NYTEX Party under the provisions of any agreement, charter document, instrument, or
operating agreement or other instrument to which any NYTEX Party is a party or by which any NYTEX
Party or its property is a party or by which it may be bound, including under the provisions of the
Senior Debt Documents, the Subordinated Debt Documents or the Acquisition Agreement.




     3.2. Formation and Qualification.



     (a) Each NYTEX Party is duly formed and in good standing under the laws of the state
listed on Schedule 3.2(a) and is qualified to do business and is in good standing in the states
listed on Schedule 3.2(a) which constitute all states in which qualification and good standing are
necessary for such NYTEX Party to conduct its business and own its property and where the failure
to so qualify could reasonably be expected to have a Material Adverse Effect on such NYTEX Party.
Each NYTEX Party has delivered to the Purchaser true and complete copies of its Organizational
Documents.



     (b) The only Subsidiaries of the NYTEX Parties are listed on Schedule 3.2(b). The Equity
Interests of each NYTEX Party (other than Parent) are presently held by the Persons identified on
Schedule 3.2(b), in the numbers of shares or interests set forth thereon.



     3.3. Tax Returns. Except as set forth on Schedule 3.3, (a) each NYTEX Party has
filed all federal, state and local tax returns and other reports each is required by law to file
and has paid all taxes, assessments, fees and other governmental charges that are due and payable,
(b) federal, state and local income tax returns of each NYTEX Party (other than Parent) have been
examined and reported upon by the appropriate taxing authority or closed by applicable statute and
satisfied for all fiscal years prior to and including the fiscal year ending August 31, 2009 and
(c) the provision for taxes on the books of each NYTEX Party is adequate for all years not closed
by applicable statutes, and for its current fiscal year, and no NYTEX Party has any knowledge of
any deficiency or additional assessment in connection therewith not provided for on its books.



     3.4. Financial Statements.



     (a) The pro forma balance sheet of the NYTEX Parties on a consolidated basis (the “Pro
Forma Balance Sheet”) furnished to the Purchaser on the Closing Date and annexed hereto as Exhibit
3.4(a) reflects the consummation of the transactions contemplated by the Acquisition Agreement, the
Senior Debt Documents, the Subordinated Debt Documents and under this Agreement (collectively, the
“Transactions”) and is accurate, complete and correct and fairly reflects the financial condition
of the NYTEX Parties on a consolidated basis as of the Closing Date after giving effect to the
Transactions, and has been prepared in accordance with GAAP,



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consistently applied. The Pro Forma Balance Sheet has been Certified as accurate, complete
and correct in all material respects by the Chief Financial Officer of the Company. All financial
statements referred to in this subsection 3.4(a), including the related schedules and notes
thereto, have been prepared, in accordance with GAAP, except as may be disclosed in such financial
statements.




     (b) The twelve (12)-month cash flow projections of the NYTEX Parties on a consolidated
basis and their projected balance sheets as of the Closing Date, copies of which are annexed hereto
as Exhibit 3.4(b) (the “Projections”) were approved by the Chief Financial Officer of the Company
and are based on underlying assumptions which provide a reasonable basis for the projections
contained therein. The cash flow Projections together with the Pro Forma Balance Sheet, are
referred to as the “Pro Forma Financial Statements”.



     (c) The consolidated and consolidating balance sheets of the NYTEX Parties, their
Subsidiaries and such other Persons described therein (including the accounts of all Subsidiaries
for the respective periods during which a subsidiary relationship existed) as of August 31, 2010,
and the related statements of income, changes in stockholder’s equity, and changes in cash flow for
the period ended on such date, all accompanied by reports thereon containing opinions without
qualification by independent certified public accountants, copies of which have been delivered to
Agent, have been prepared in accordance with GAAP, consistently applied (except for changes in
application in which such accountants concur) and present fairly the financial position of the
NYTEX Parties and their Subsidiaries and the Restricted Subsidiaries at such date and the results
of their operations for such period. Except as has been disclosed in Parent’s filings with the
SEC, since August 31, 2010 there has been no change in the condition, financial or otherwise, of
the NYTEX Parties or their Subsidiaries as shown on the consolidated balance sheet as of such date
and no change in the aggregate value of machinery, equipment and Real Property owned by the NYTEX
Parties and their respective Subsidiaries, except changes in the Ordinary Course of Business, none
of which individually or in the aggregate has been materially adverse.



     3.5. Entity Names. No NYTEX Party has been known by any other corporate name in
the past five (5) years and does not sell Inventory under any other name except as set forth on
Schedule 3.5, nor has any NYTEX Party been the surviving company of a merger or consolidation or
acquired all or substantially all of the assets of any Person, with the exception of those assets
acquired pursuant to the Acquisition Agreement during the preceding five (5) years.



     3.6. O.S.H.A. and Environmental Compliance. Except as set forth on Schedule 3.6:



     (a) (i) Each NYTEX Party has duly complied with, and its facilities, business, assets,
property, leaseholds, Real Property and Equipment are in compliance in all material respects with,
the provisions of the Federal Occupational Safety and Health Act, the Environmental Protection Act,
RCRA and all other Environmental Laws; and (ii) there have been no outstanding citations, notices
or orders of non-compliance issued to any NYTEX Party or relating to its business, assets,
property, leaseholds or Equipment under any such laws, rules or regulations.



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     (b) Each NYTEX Party has been issued all required federal, state and local licenses,
certificates or permits relating to all applicable Environmental Laws.



     (c) (i) There are no visible signs of releases, spills, discharges, leaks or disposal
(collectively referred to as “Releases”) of Hazardous Substances at, upon, under or within any Real
Property or any premises leased by any NYTEX Party; (ii) there are no underground storage tanks or
polychlorinated biphenyls on the Real Property or any premises leased by any NYTEX Party; (iii)
neither the Real Property nor any premises leased by any NYTEX Party has ever been used as a
treatment, storage or disposal facility of Hazardous Waste; and (iv) no Hazardous Substances are
present on the Real Property or any premises leased by any NYTEX Party, excepting such quantities
as are handled in accordance with all applicable manufacturer’s instructions and governmental
regulations and in proper storage containers and as are necessary for the operation of the
commercial business of any NYTEX Party or of its tenants.



     3.7. Solvency; No Litigation, Violation, Indebtedness or Default.



     (a) Each NYTEX Party is, and after giving effect to the Transactions, each of them will be
solvent, able to pay its debts as they mature, and has, and after giving effect to the
Transactions, will have capital sufficient to carry on its business and all businesses in which it
is about to engage, and (i) as of the Closing Date, the fair present saleable value of its assets,
calculated on a going concern basis, is in excess of the amount of its liabilities and (ii)
immediately subsequent to the Closing, the fair saleable value of its assets (calculated on a going
concern basis) will be in excess of the amount of its liabilities.



     (b) Except as disclosed in Schedule 3.7(b), no NYTEX Party has (i) any pending or
threatened litigation, arbitration, actions or proceedings which involve the possibility of having
a Material Adverse Effect, and (ii) any liabilities or indebtedness for borrowed money other than
the Obligations.



     (c) No NYTEX Party is in violation of any applicable statute, law, rule, regulation or
ordinance in any respect which could reasonably be expected to have a Material Adverse Effect, nor
is any NYTEX Party in violation of any order of any court, Governmental Authority or arbitration
board or tribunal.



     (d) No NYTEX Party nor any member of the Controlled Group maintains or contributes to any
Plan other than (i) as of the Closing Date, those listed on Schedule 3.7(d) hereto and (ii)
thereafter, as permitted under this Agreement. (i) No Plan has incurred any “accumulated funding
deficiency,” as defined in Section 302(a)(2) of ERISA and Section 412(a) of the Code, whether or
not waived, and each NYTEX Party and each member of the Controlled Group has met all applicable
minimum funding requirements under Section 302 of ERISA in respect of each Plan; (ii) each Plan
which is intended to be a qualified plan under Section 401(a) of the Code as currently in effect
has been determined by the Internal Revenue Service to be qualified under Section 401(a) of the
Code and the trust related thereto is exempt from federal income tax under Section 501(a) of the
Code; (iii) neither any NYTEX Party nor any member of the Controlled Group has incurred any
liability to the PBGC other than for the payment of premiums, and there are no premium payments
which have become due which are unpaid; (iv) no Plan has been terminated by the plan administrator
thereof nor by the PBGC, and there is no



-23-









 




occurrence which would cause the PBGC to institute proceedings under Title IV of ERISA to
terminate any Plan; (v) at this time, the current value of the assets of each Plan exceeds the
present value of the accrued benefits and other liabilities of such Plan and neither any NYTEX
Party nor any member of the Controlled Group knows of any facts or circumstances which would
materially change the value of such assets and accrued benefits and other liabilities; (vi) neither
any NYTEX Party nor any member of the Controlled Group has breached any of the responsibilities,
obligations or duties imposed on it by ERISA with respect to any Plan; (vii) neither any NYTEX
Party nor any member of a Controlled Group has incurred any liability for any excise tax arising
under Section 4972 or 4980B of the Code, and no fact exists which could give rise to any such
liability; (viii) neither any NYTEX Party nor any member of the Controlled Group nor any fiduciary
of, nor any trustee to, any Plan, has engaged in a “prohibited transaction” described in Section
406 of the ERISA or Section 4975 of the Code nor taken any action which would constitute or result
in a Termination Event with respect to any such Plan which is subject to ERISA; (ix) each NYTEX
Party and each member of the Controlled Group has made all contributions due and payable with
respect to each Plan; (x) there exists no event described in Section 4043(b) of ERISA, for which
the thirty (30) day notice period has not been waived; (xi) neither any NYTEX Party nor any member
of the Controlled Group has any fiduciary responsibility for investments with respect to any plan
existing for the benefit of persons other than employees or former employees of any NYTEX Party and
any member of the Controlled Group; (xii) neither any NYTEX Party nor any member of the Controlled
Group maintains or contributes to any Plan which provides health, accident or life insurance
benefits to former employees, their spouses or dependents, other than in accordance with Section
4980B of the Code; (xiii) neither any NYTEX Party nor any member of the Controlled Group has
withdrawn, completely or partially, from any Multiemployer Plan so as to incur liability under the
Multiemployer Pension Plan Amendments Act of 1980 and there exists no fact which would reasonably
be expected to result in any such liability; and (xiv) no Plan fiduciary (as defined in Section
3(21) of ERISA) has any liability for breach of fiduciary duty or for any failure in connection
with the administration or investment of the assets of a Plan.




     3.8. Patents, Trademarks, Copyrights and Licenses. All patents, patent
applications, registered trademarks, trademark applications, service marks, service mark
applications, registered copyrights, copyright applications, trade names, trade name applications,
assumed names, and domain names owned or utilized by any NYTEX Party are set forth on Schedule 3.8;
there is no objection to or pending challenge to the validity of any such patent, registered
trademark, registered copyright, trade name, or domain name, license and no NYTEX Party is aware of
any grounds for any challenge, except as set forth on Schedule 3.8. Each patent, patent
application, registered trademark, trademark application, service mark, service mark application,
service mark license, registered copyright, copyright application owned or held by any NYTEX Party
and all trade secrets used by any NYTEX Party consist of original material or property developed by
such NYTEX Party or was lawfully acquired by such NYTEX Party from the proper and lawful owner
thereof. Each of such items has been maintained so as to preserve the value thereof from the date
of creation or acquisition thereof.



     3.9. Licenses and Permits. Except as set forth in Schedule 3.9, each NYTEX Party
(a) is in compliance with and (b) has procured and is now in possession of, all material licenses
or permits required by any applicable federal, state, provincial or local law, rule or regulation
for the operation of its business in each jurisdiction wherein it is now conducting or proposes to



-24-









 




conduct business and where the failure to procure such licenses or permits could reasonably be
expected to have a Material Adverse Effect.




     3.10. Default of Indebtedness. No NYTEX Party is in material default in the
payment of the principal of or interest on any Indebtedness or under any instrument or agreement
under or subject to which any Indebtedness has been issued and no event has occurred under the
provisions of any such instrument or agreement which with or without the lapse of time or the
giving of notice, or both, constitutes or would constitute an event of default thereunder.



     3.11. No Default. Except as set forth on Schedule 3.11, no NYTEX Party is in
material default in the payment or performance of any of its contractual obligations.



     3.12. No Burdensome Restrictions. No NYTEX Party is party to any contract or
agreement the performance of which could have a Material Adverse Effect. Each NYTEX Party has
heretofore delivered to the Purchaser true and complete copies of all material contracts to which
it is a party or to which it or any of its properties is subject. No NYTEX Party has agreed or
consented to cause or permit in the future (upon the happening of a contingency or otherwise) any
of its property, whether now owned or hereafter acquired, to be subject to a Lien which is not a
Permitted Lien.



     3.13. No Labor Disputes. No NYTEX Party is involved in any labor dispute; there
are no strikes or walkouts or union organization of any NYTEX Party’s employees threatened or in
existence and no labor contract is scheduled to expire during the period between the Closing Date
and the Maturity Date other than as set forth on Schedule 3.13.



     3.14. Margin Regulations. No NYTEX Party is engaged, nor will it engage,
principally or as one of its important activities, in the business of extending credit for the
purpose of “purchasing” or “carrying” any “margin stock” within the respective meanings of each of
the quoted terms under Regulation U of the Board of Governors of the Federal Reserve System as now
and from time to time hereafter in effect. No part of the proceeds of the Purchase Price will be
used for “purchasing” or “carrying” “margin stock” as defined in Regulation U of such Board of
Governors.



     3.15. Investment Company Act. No NYTEX Party is an “investment company”
registered or required to be registered under the Investment Company Act of 1940, as amended, nor
is it controlled by such a company.



     3.16. Disclosure. No representation or warranty made by Parent or the Company in
this Agreement or in any financial statement, report, certificate or any other document furnished
in connection herewith or therewith contains any untrue statement of a material fact or omits to
state any material fact necessary to make the statements herein or therein not misleading. There
is no fact known to Parent or the Company which Parent or the Company has not disclosed to the
Purchaser in writing with respect to the transactions contemplated by the Acquisition Agreement,
the Senior Debt Documents, the Subordinated Debt Documents or this Agreement which could reasonably
be expected to have a Material Adverse Effect.



-25-









 





     3.17. Delivery of Documents. The Purchaser has received complete copies of the
Acquisition Agreement, the Senior Debt Documents and the Subordinated Debt Documents (including all
exhibits, schedules and disclosure letters referred to therein or delivered pursuant thereto, if
any) and all amendments thereto, waivers relating thereto and other side letters or agreements
affecting the terms thereof. None of such documents and agreements has been amended or
supplemented, nor have any of the provisions thereof been waived, except pursuant to a written
agreement or instrument which has heretofore been delivered to the Purchaser.



     3.18. Swaps. No NYTEX Party is a party to, nor will it be a party to, any swap
agreement whereby such NYTEX Party has agreed or will agree to swap interest rates or currencies
unless same provides that damages upon termination following an event of default thereunder are
payable on an unlimited “two-way basis” without regard to fault on the part of either party.



     3.19. Conflicting Agreements. No provision of any mortgage, indenture, contract,
agreement, judgment, decree or order binding on any NYTEX Party conflicts with, or requires any
Consent which has not already been obtained to, or would in any way prevent the execution, delivery
or performance of, the terms of this Agreement or the other Transaction Documents.



     3.20. Application of Certain Laws and Regulations. Neither any NYTEX Party nor,
to the knowledge of the NYTEX Parties, any Affiliate of any NYTEX Party (other than the Purchaser)
is subject to any law, statute, rule or regulation which regulates the incurrence of any
Indebtedness, including laws, statutes, rules or regulations relative to common or interstate
carriers or to the sale of electricity, gas, steam, water, telephone, telegraph or other public
utility services.



     3.21. Business and Property. Upon and after the Closing Date, the NYTEX Parties
do not propose to engage in any business other than those conducted on the Closing Date and those
set forth on Schedule 3.21 and activities necessary to conduct the foregoing. On the Closing Date,
each NYTEX Party will own all the property and possess all of the rights and Consents necessary for
the conduct of the business of such NYTEX Party.



     3.22. Insurance. Each NYTEX Party and their respective properties are insured
with insurance companies reasonably believed by Parent or the Company to be financially sound and
reputable, and which are not Affiliates of Parent, in such amounts, with such deductibles and
covering such risks as are customarily carried by companies engaged in similar businesses and
owning similar properties in localities where the NYTEX Parties operate. A true and complete
listing of such insurance, including issuers, coverages and deductibles, as of the Closing Date, is
set forth in Schedule 3.22. All premiums in respect of such policies have been paid through the
Closing Date.



     3.23. Anti-Terrorism Laws.



     (a) General. Neither any NYTEX Party nor, to the knowledge of Parent, any
Affiliate of any NYTEX Party (other than the Purchaser) is in violation of any Anti-Terrorism Law
or engages in or conspires to engage in any transaction that evades or avoids, or has the
purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in
any Anti-Terrorism Law.



-26-









 





     (b) Executive Order No. 13224. Neither any NYTEX Party, nor to the knowledge of
Parent, any Affiliate of any NYTEX Party (other than the Purchaser) or their respective agents
acting or benefiting in any capacity in connection with the Purchase Price or other transactions
hereunder, is any of the following (each a “Blocked Person”):



          (i) a Person that is listed in the annex to, or is otherwise subject to the provisions of,
the Executive Order No. 13224;



          (ii) a Person owned or controlled by, or acting for or on behalf of, any Person that
is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order No.
13224;



          (iii) a Person or entity with which any Lender is prohibited from dealing or otherwise
engaging in any transaction by any Anti-Terrorism Law;



          (iv) a Person or entity that commits, threatens or conspires to commit or supports
“terrorism” as defined in the Executive Order No. 13224;



          (v) a Person or entity that is named as a “specially designated national” on the most
current list published by the U.S. Treasury Department Office of Foreign Asset Control at its
official website or any replacement website or other replacement official publication of such list,
or



          (vi) a Person or entity who is affiliated or associated with a Person or entity listed
above.


Neither any NYTEX Party nor to the knowledge of any NYTEX Party, any of its agents acting in any
capacity in connection with the Purchase Price or other transactions hereunder (A) conducts any
business or engages in making or receiving any contribution of funds, goods or services to or for
the benefit of any Blocked Person, or (B) deals in, or otherwise engages in any transaction
relating to, any property or interests in property blocked pursuant to the Executive Order No.
13224.




     3.24. Trading with the Enemy. No NYTEX Party has engaged, nor does it intend to
engage, in any business or activity prohibited by the Trading with the Enemy Act.



     3.25. Federal Securities Laws. Other than Parent and except as set forth on
Schedule 3.25, no NYTEX Party and none of their respective Subsidiaries (a) is required to file
periodic reports under the Exchange Act, (b) has any securities registered under the Exchange Act
or (c) has filed a registration statement that has not yet become effective under the Securities
Act. Parent has filed with the SEC all SEC Reports for the two years preceding the date hereof (or
such shorter period as Parent was required by law to file such material) on a timely basis or has
received a valid extension of such time of filing and has filed any such SEC Reports prior to the
expiration of any such extension. As of their respective dates, the SEC Reports complied in all
material respects with the requirements of the Securities Act and the Exchange Act, as



-27-









 




applicable, and the rules and regulations promulgated thereunder, and none of the SEC Reports,
when filed, contained any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.




     Section 4. Representations of Purchaser. The Purchaser hereby represents and
warrants to Parent and the Company as follows:



     4.1. Authority. The Purchaser has full power, authority and legal right to enter
into this Agreement and the other Transactions Documents to which it is a party and to perform all
its respective obligations hereunder and thereunder. This Agreement and the other Transaction
Documents to which the Purchaser is a party have been duly executed and delivered by the Purchaser,
and this Agreement and the other Transaction Documents to which the Purchaser is a party constitute
the legal, valid and binding obligation of the Purchaser enforceable in accordance with their
terms, except as such enforceability may be limited by any applicable bankruptcy, insolvency,
moratorium or similar laws affecting creditors’ rights generally. The execution, delivery and
performance of this Agreement and of the other Transaction Documents to which the Purchaser is a
party (a) are within the Purchaser’s limited liability company power, have been duly authorized by
all necessary limited liability company action, are not in contravention of law or the terms of the
Purchaser’s Organization Documents, (b) will not conflict with or violate any law or regulation, or
any judgment, order or decree of any Governmental Authority, and (c) will not require the Consent
of any Governmental Authority.



     4.2. Formation. The Purchaser is duly formed and in good standing under the laws
of the state of Delaware.



     4.3. Investment. (a) The Purchaser is an “accredited investor,” within the
meaning of Rule 501 promulgated by the SEC under the Securities Act, and (b) it is acquiring the
Shares and the Warrants to be purchased by it hereunder for its own account, for investment, and
not with a view to or for sale in connection with any distribution thereof in violation of the
registration provisions of the Securities Act or the rules and regulations promulgated thereunder.



     Section 5. Closing Conditions.



     5.1. Conditions to Closing. The Purchaser’s obligation to purchase and pay for
the Shares and the Warrants shall be subject to the satisfaction, or waiver by the Purchaser in
writing, on or before the Closing Date, of the following conditions:



     (a) Proceedings Satisfactory. All corporate and other proceedings taken or to be
taken in connection with the transactions contemplated hereby and all documents incident thereto
shall be reasonably satisfactory in form and substance to the Purchaser and its counsel.



     (b) Deliveries. The Purchaser and its counsel shall have received all such
counterpart originals or certified or other copies of such documents as it may reasonably request,
including:



          (i) a certificate representing the Shares, duly executed by the Company;



          (ii) the Warrants, each dated the Closing Date and duly executed by Parent;



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          (iii) the Registration Rights Agreement, duly executed by Parent;



          (iv) certificates dated as of a recent date as to the good standing of each NYTEX Party in
each jurisdiction where any of such Persons is incorporated or is authorized to do business as a
foreign corporation;



          (v) certified copies of the Organizational Documents of each NYTEX Party (including the
Senior Series A Certificate of Designations and the Parent Series B Certificate of Designations);



          (vi) certified copies of (A) resolutions of Parent’s and the Company’s board of directors
approving (1) the execution, delivery and performance of this Agreement and the other Transaction
Documents, (2) the increase of the number of directors serving on Parent’s and the Company’s board
of directors by two, and (3) the appointment of the two individuals designated by the Purchaser in
writing to fill the vacancies resulting from such increases and (B) resolutions of the Company’s
stockholders approving (1) the Senior Series A Certificate of Designations and (2) the Parent
Series B Certificate of Designations;



          (vii) certificates as to the incumbency and signatures of each of the officers of the
Company who shall execute this Agreement or any other Transaction Document on behalf of Parent and
the Company;



          (viii) an Officer’s Certificate, dated the Closing Date, to the effect of the matters
stated in Sections 5.1(c), (d), (e) and (f);



          (ix) a legal opinion, dated as of the Closing Date, from Strasburger & Price, LLP, counsel
for the Company, in substantially the form of Exhibit F attached hereto;



          (x) evidence satisfactory to the Purchaser that valid policies of insurance and bonding
coverage, including key man life and business interruption insurance, are in full force and effect
for the NYTEX Parties with terms and conditions satisfactory to the Purchaser;



          (xi) evidence satisfactory to the Purchaser that the Company’s trailing twelve-month
EBITDA as of September 30, 2010, pro forma for the acquisition of the Francis Entities, is at least
$15.0 million; and



     (c) Performance of Obligations. Each of Parent and the Company shall have
performed all agreements on its part required to be performed under this Agreement on or prior to
the Closing Date.



     (d) No Default. No Default or Event of Default shall exist on the Closing Date
immediately after giving effect to the transactions contemplated hereby.



     (e) Absence of Material Adverse Change, Etc. Since August 31, 2010, no change or
changes shall have occurred to the business, operations, properties, assets, income, prospects or
condition, financial or otherwise, of the NYTEX Parties, which the Purchaser reasonably believes in
good faith to constitute a Material Adverse Effect.



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     (f) Consents and Approvals. All necessary consents, approvals and authorizations
of, and declarations, registrations and filings with, Governmental Authorities and nongovernmental
Persons required in order to consummate the transactions contemplated herein shall have been
obtained or made and shall be in full force and effect.



     (g) Absence of Litigation, Orders, Etc. There shall not be pending or, to the
knowledge of any NYTEX Party, threatened, any action, suit, proceeding, governmental investigation
or arbitration against or affecting any of the NYTEX Parties or their respective assets or property
(and, as to any action, suit, proceeding, governmental investigation or arbitration so disclosed,
there shall not have occurred since the date of this Agreement any development) which seeks to
enjoin or restrain any of the transactions contemplated herein or which the Purchaser reasonably
believes in good faith is likely to have a Material Adverse Effect. No Order of any court,
arbitrator or Governmental Authority shall be in effect which purports to enjoin or restrain any of
the transactions contemplated herein or which the Purchaser reasonably believes in good faith to
constitute a Material Adverse Effect.



     (h) Amendment to Certificate of Incorporation. Parent shall have filed the Parent
Series B Certificate of Designations with the Secretary of State of the State of Delaware and
delivered filed, stamped copies thereof from such Secretary of State.



     (i) Amendment to ByLaws. Parent’s and the Company’s board of directors shall have
(i) increased the number of directors serving on the Board by two and (ii) approved the appointment
of the two individuals designated by the Purchaser in writing to fill the vacancies.



     (j) Senior Debt Transaction. The Senior Debt Documents shall have been duly
executed and delivered by each of the parties thereto, each in form and substance satisfactory to
the Purchaser, and shall be in full force and effect. True and complete copies of such documents,
with all amendments thereto, shall have been delivered to the Purchaser. All conditions precedent
to the consummation of the transactions contemplated by the Senior Debt Documents shall have been
fulfilled and no such condition shall have been waived (unless such waiver was disclosed to and
consented to in writing by the Purchaser). The transactions contemplated by the Senior Debt
Documents shall have been consummated in accordance with the provisions thereof, the Indebtedness
of the NYTEX Parties upon such consummation shall not have exceeded $24,000,000 and the Purchaser
and its counsel shall have received such evidence thereof as they may reasonably request.



     (k) Series A Preferred Stock Transaction. Parent shall have consummated the sale
of not less than $5,300,000 worth of shares of its Series A Preferred Stock and warrants to certain
investors on or prior to the Closing Date pursuant to and in accordance with the Series A Preferred
Stock Documents, each in form and substance satisfactory to the Purchaser. True and complete
copies of such documents, with all amendments thereto, duly executed by the parties thereto shall
have been delivered to the Purchaser. All conditions precedent to the consummation of the
transactions contemplated by the Series A Preferred Stock Documents shall have been fulfilled and
no such condition shall have been waived (unless such waiver was disclosed to and consented to in
writing by the Purchaser).



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     (l) Francis Acquisition Transaction. The Acquisition Agreement and the documents
related thereto shall have been duly executed and delivered by each of the parties thereto, each in
form and substance satisfactory to the Purchaser, and shall be in full force and effect. True and
complete copies of such documents, with all amendments thereto, shall have been delivered to the
Purchaser. All conditions precedent to the consummation of the transactions contemplated by the
Acquisition Agreement shall have been fulfilled and no such condition shall have been waived
(unless such waiver was disclosed to and consented to in writing by the Purchaser). The
transactions contemplated by the Acquisition Agreement shall have been consummated in accordance
with the provisions thereof, and the Purchaser and its counsel shall have received such evidence
thereof as they may reasonably request.



     (m) Employment Arrangements. Parent, the Company and the Francis Entities, as
applicable, shall have entered into employment agreements with, and adopted compensation plans
(including bonus arrangements) for, their senior management, each in form and substance
satisfactory to the Purchaser. True and complete copies of such documents, duly executed by the
parties thereto, with all amendments thereto, shall have been delivered to the Purchaser.



     (n) Pro Forma Financial Statements. The Purchaser shall have received a copy of
the Pro Forma Financial Statements which shall be satisfactory in all respects to the Purchaser;



     (o) Document and Diligence Review. The Purchaser and its counsel shall have (i)
reviewed all books and records, organization documents, third party financing agreements, customer
agreements, material contracts of the NYTEX Parties, including leases, union contracts, labor
contracts, vendor supply contracts, license agreements and distributorship agreements and (ii)
reviewed the NYTEX Parties corporate and legal structure, and such contracts, agreements,
references to structure shall be satisfactory to agent and its counsel, including all terms,
conditions and documentation related to the Equity Documents;



     (p) Fees and Expenses. The fee payable by the Company on the Closing Date
pursuant to Section 2.1(c), and the expenses of the Purchaser incurred through the Closing Date and
required to be reimbursed by the Company pursuant to Section 13.2 hereof (including the fees and
disbursements of Winston & Strawn LLP, counsel to the Purchaser, in connection with the preparation
of this Agreement and the transactions contemplated hereby) shall be paid in full by the Company on
the Closing Date. The Company hereby authorizes and directs the Purchaser to withhold the
aggregate amount of such fees and expenses (less any amount previously received by the Purchaser as
a deposit in respect of such fees and expenses) from the aggregate amount of the purchase price of
the Shares and the Warrants to be disbursed to the Company on the Closing Date, and to apply such
withheld amount to the payment and satisfaction of such fees and expenses.



     Section 6. Financial Statements and Information. Parent or the Company shall
furnish to the Purchaser, so long as (i) it shall hold any Shares (the “Shares Condition”), or (ii)
solely with respect to Sections 6(a), (b), (c), (e) and (f), it shall hold shares of Parent Common
Stock issued upon exercise of the Purchaser Warrant or the Control Warrant that, when combined with
shares of Parent Common Stock issuable upon the future exercise of the Purchaser Warrant or the
Control Warrant, exceeds 5% of the total aggregate number of
outstanding shares of Parent Common Stock, calculated on a Fully-Diluted Basis (the “Common
Stock Condition”):



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     (a) Monthly Financials. As soon as available and in any event within thirty (30)
days after the end of each month, copies of the unaudited consolidated and consolidating balance
sheets of the Company and its Subsidiaries as of the end of such month, and of the related
unaudited consolidated and consolidating statements of income, retained earnings and cash flows for
such month and for the portion of the fiscal year ended with the last day of such month, all in
reasonable detail and stating in comparative form (i) the consolidated and consolidating figures as
of the end of and for the corresponding date and month in the previous fiscal year and (ii) the
corresponding figures from the consolidated budget of the Company and its Subsidiaries for such
period, all Certified by the Chief Financial Officer of the Company.



     (b) Quarterly Financial Statements. As soon as available and in any event within
forty-five (45) days after the end of each fiscal quarter of the Company, copies of the unaudited
consolidated and consolidating balance sheets of the Company and its Subsidiaries as of the end of
such fiscal quarter, and of the related unaudited consolidated and consolidating statements of
income, retained earnings and cash flows for such fiscal quarter and for the portion of the fiscal
year ended with the last day of such fiscal quarter, all in reasonable detail and stating in
comparative form (i) the consolidated figures as of the end of and for the corresponding date and
fiscal quarter in the previous fiscal year and (ii) the corresponding figures from the consolidated
budget of the Company and its Subsidiaries for such period, all Certified by the Chief Financial
Officer of the Company.



     (c) Annual Financial Statements. As soon as available and in any event within one hundred
twenty (120) days after the end of each fiscal year of the Company,



          (i) copies of the audited consolidated and unaudited consolidating balance sheets of the
Company and its Subsidiaries as of the end of such fiscal year, and of the related audited
consolidated and unaudited consolidating statements of income, retained earnings and cash flows for
such fiscal year, together with the notes thereto, all in reasonable detail and stating in
comparative form (A) the respective audited consolidated and unaudited consolidating figures as of
the end of and for the previous fiscal year and (B) the corresponding figures from the consolidated
budget of the Company and its Subsidiaries for such fiscal year furnished pursuant to Section 6(n)
(x) in the case of such audited consolidated financial statements, accompanied by a report thereon
of the Accountants, which report shall be unqualified as to going concern and scope of audit and
shall state that such consolidated financial statements present fairly, in all material respects,
the consolidated financial position of the Company and its Subsidiaries as at the end of such
fiscal year and the consolidated results of their operations, retained earnings and cash flows for
such fiscal year in accordance with GAAP applied on a basis consistent with prior years (except as
otherwise stated therein) and that the examination by the Accountants in connection with such
consolidated financial statements has been made in accordance with generally accepted auditing
standards and (y) in the case of such unaudited consolidating financial statements, Certified by
the Chief Financial Officer of the Company; and



          (ii) a written statement of the Accountants or a certificate from the Chief Financial
Officer of the Company (A) setting forth computations in reasonable detail showing



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whether or not as at the end of such fiscal year there existed any Event of Default resulting
from a breach or violation of any of Sections 9.1, 9.6, 9.9, 10.1, 10.2, 10.3, 10.4, 10.5 or 10.6,
and (B) stating that in making the examination necessary for their report on such financial
statements they obtained no knowledge of any Default or Event of Default that occurred or existed
during such fiscal year, or if such Chief Financial Officer shall have obtained knowledge of any
such Default or Event of Default, specifying the nature and status thereof.




     (d) Compliance Certificate. Concurrently with each of the quarterly and annual
financial statements furnished pursuant to Sections 6(b) and 6(c) a Compliance Certificate properly
completed as of the last day of the applicable fiscal quarter or fiscal year and signed by the
Chief Financial Officer of the Company.



     (e) Bank Statements. Promptly after receipt thereof, copies of quarterly
statements for each of the Deposit Accounts and Securities Accounts maintained by the Company and
each of the Subsidiaries.



     (f) Shareholder Reports. Promptly after the same are available and in any event
within fifteen (15) days thereof, copies of all such proxy statements, financial statements,
notices and reports as Parent or the Company shall send or make available generally to their
securityholders, and copies of all regular and periodic reports and of all registration statements
(other than on Form S 8 or a similar form) which Parent, the Company or any of its Subsidiaries may
file with the SEC or with any securities exchange.



     (g) Management Letters. Promptly after the receipt thereof by any NYTEX Party,
and in any event within fifteen (15) days thereof, copies of any management letters and any reports
as to material inadequacies in accounting controls (including reports as to the absence of any such
inadequacies) submitted to any NYTEX Party by the Accountants in connection with any audit thereof
made by the Accountants.



     (h) Notice of Default. Promptly (and in any event within five (5) days) after any
Responsible Officer of a NYTEX Party has knowledge of (A) the existence of any Default or Event of
Default on the part of any NYTEX Party, an Officer’s Certificate of Parent or the Company
specifying the nature and period of existence thereof and what action Parent or the Company is
taking or proposes to take with respect thereto; or (B) any Indebtedness of the Company or any of
its Subsidiaries being declared due and payable before its expressed maturity, or any holder of
such Indebtedness having the right to declare such Indebtedness due and payable before its
expressed maturity, because of the occurrence of any default (or any event which, with notice
and/or the lapse of time, shall constitute any such default) under such Indebtedness, an Officer’s
Certificate of the Company describing the nature and status of such matters and what action the
Company or such Subsidiary is taking or proposes to take with respect thereto.



     (i) Regulatory Matters. As soon as reasonably practicable but in any event within
three (3) Business Days after receipt or delivery thereof, copies of any and all material notices
and other material communications received by any NYTEX Party from, or sent by such NYTEX Party to,
any federal or state regulatory body with jurisdiction over such NYTEX



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Party’s products, services, business and/or processes with respect to any NYTEX Party’s
products, services or practices.




     (j) [Reserved].



     (k) Notice of Litigation. Promptly (and in any event within fifteen (15) days)
after Parent or the Company has knowledge of (i) the institution of, or written threat of, any
action, suit, proceeding, governmental investigation or arbitration against or affecting any NYTEX
Party or any property of any of them or (ii) any material development in any such action, suit,
proceeding, governmental investigation or arbitration, which, in either case, if adversely
determined, is likely to have a Material Adverse Effect, an Officer’s Certificate of Parent or the
Company describing the nature and status of such matter in reasonable detail.



     (l) ERISA Notices. Promptly after any Responsible Officer of a NYTEX Party has
knowledge of any of the following events if the same would reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect, an Officer’s Certificate describing
the nature and status of such event, together with a copy of any notice with respect to such event
that may be required to be filed with a Governmental Authority and any notice delivered by a
Governmental Authority to the Company or any ERISA Affiliate with respect to such event:



          (i) an ERISA Event;



          (ii) the adoption of any new Pension Plan by the Company or any ERISA Affiliate;



          (iii) the adoption of any amendment to a Pension Plan, if such amendment results in a
material increase in benefits or unfunded liabilities; or



          (iv) the commencement of contributions by the Company or any ERISA Affiliate to any
Multiemployer Plan or any Pension Plan.



     (m) Notice of Material Adverse Effect. Promptly after any Responsible Officer of
any NYTEX Party has knowledge of any Material Adverse Effect with respect to which notice is not
otherwise required to be given pursuant to this Section 6, an Officer’s Certificate of the Company
setting forth the details of such Material Adverse Effect and stating what action the NYTEX Party
has taken or proposes to take with respect thereto.



     (n) Annual Budget. Parent or the Company shall deliver to the Purchaser a draft
copy of the annual Budget not less than thirty days (30) before the end of each fiscal year, which
Budget shall be subject to Purchaser’s approval.



     (o) Annual Insurance Report. At least once in each fiscal year, a report of a
reputable insurance broker with respect to all insurance maintained by the NYTEX Parties, together
with a certificate of insurance evidencing the effectiveness of the policies of insurance required
to be maintained pursuant to Sections 8.5(a) and (c).



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     (p) Certain Changes and Conduct of Business. Promptly after the occurrence
thereof, notice of all material developments in respect of the assets, liabilities, ownership,
operations or business of any NYTEX Party, including (i) any issuance of debt securities or
incurrence of any Indebtedness by any NYTEX Party, (ii) a change in the number of members of the
board of directors of any NYTEX Party, (iii) a sale, lease or transfer of any material portion of
the assets of any NYTEX Party, other than in the Ordinary Course of Business, (iv) an acquisition
of the Equity Interests of any Person, or of any material assets of any Person or division or line
of business of any Person, other than in the Ordinary Course of Business, and (v) except with
respect to Parent, any change in the outstanding number or ownership of the shares of the Equity
Interests of a NYTEX Party (specifying the details of any such change, including the identity and
ownership amount of any new owner). Parent or the Company shall provide the Purchaser with any
written information provided to the board of directors or board of managers (or similar body) of
any NYTEX Party in their respective capacities as such.



     (q) Related Party Transactions. Within ninety (90) days after the end of each
fiscal year, a report describing in reasonable detail the nature and amount of all transactions
during such fiscal year between any NYTEX Party and any officer, director or Affiliate of such
NYTEX Party (other than the Purchaser), other than transactions with Purchaser and compensation and
benefits paid by the NYTEX Parties to their officers, directors and employees in the Ordinary
Course of Business.



     (r) Other Information. Any other information, including financial statements and
computations, relating to the performance of Obligations arising under this Agreement or the other
Transaction Documents, or the assets, liabilities, business or operations of any NYTEX Party, that
the Purchaser may from time to time reasonably request and which is capable of being obtained,
produced or generated by any NYTEX or of which any of them has knowledge.



     Section 7. Inspection Rights; Board Observation Rights.



     7.1. Inspection of Books and Properties. So long as the Purchaser shall meet the
Shares Condition or the Common Stock Condition, the Purchaser and its representatives and
independent contractors shall have the right to visit and inspect any of the properties and
locations of the NYTEX Parties, to examine their books of account and Records, to make copies and
extracts therefrom at their expense, and to discuss their affairs, finances and accounts with, and
to be advised as to the same by, their officers and employees and their independent public
accountants, all at such reasonable times during normal business hours as the Purchaser may desire,
upon reasonable advance notice to Parent or the Company and at the sole cost and expense of the
Purchaser; provided that, during the continuance of any Default or Event of Default, the
Purchaser and its representatives and independent contractors shall have the right to do any of the
foregoing at the expense of Parent and the Company at any time during normal business hours and
without advance notice.



     7.2. Board of Directors; Observation Rights. So long as Purchaser shall meet the
Shares Condition or the Common Stock Condition, each of Parent and the Company shall cause its
board of directors to hold a meeting at least once during each fiscal quarter. So long as the
Purchaser shall meet the Shares Condition or the Common Stock Condition any of the Shares, the
Purchaser may at its option designate by written notice to Parent and the Company a



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representative (the “Observer”), who shall have the right to attend all meetings of the board
of directors of any NYTEX Party, and of any committees of such boards of directors, as applicable,
without voting on or consenting to any matters presented at such meetings. The Observer shall be
entitled to receive copies of all notices of meetings of the board of directors of such NYTEX Party
and of any such committee, and all written materials distributed to members thereof in connection
with such meetings, in each case at the same time and in the same manner as the members of such
board of directors or committee (as the case may be) receive such notices or materials. If such
board of directors or committee proposes to take any action by written consent in lieu of a
meeting, Parent or the Company will give written notice thereof to the Observer prior to the
effective date of such consent describing in reasonable detail the nature of such action, together
with copies of any written materials distributed to directors in connection therewith.




     Section 8. Affirmative Covenants. Each of Parent and the Company covenants and
agrees that so long as the Purchaser shall (i) meet the Shares Condition, or (ii) solely with
respect to Sections 8.1, 8.2, 8.3, 8.4, 8.5(a) and 8.5(b), meet the Common Stock Condition:



     8.1. Maintenance of Corporate Existence, Properties and Records. Each of Parent
and the Company shall, and shall cause the other NYTEX Parties to:



     (a) do or cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence, rights, powers and franchises including any necessary qualification
or licensing in any foreign jurisdiction;



     (b) conduct continuously and operate actively its business according to good business
practices, maintain all of its properties useful or necessary in its business in good working order
and condition (reasonable wear and tear excepted and except as may be disposed of in accordance
with the terms of this Agreement), including all licenses, patents, copyrights, trade names, trade
secrets, domain names and trademarks;



     (c) keep books of account and other Records in which full and correct entries will be made
of all of its business transactions, and reflect in its financial statements adequate accruals and
appropriations to reserves, all in accordance with GAAP; and



     (d) maintain the same fiscal year during and after the current fiscal year ending August
31, 2010.



     8.2. Payment of Taxes and Claims. Each of Parent and the Company shall, and shall
cause each of the other NYTEX Parties to, pay before they become delinquent:



     (a) all taxes, assessments and governmental charges or levies imposed upon any NYTEX Party
or its income or profits or upon their property, real, personal or mixed, or upon any part thereof;



     (b) all claims for labor, materials and supplies which, if unpaid, might result in the
creation of a Lien upon property of any NYTEX Party; and



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     (c) all claims, assessments, or levies required to be paid by the Company or any of its
ERISA Affiliates pursuant to any Plan or Multiemployer Plan or any agreement, contract or
Applicable Law governing or relating to any such plan;


provided, that the taxes, assessments, claims, charges and levies described in subsections
(a) and (b) of this Section 8.2 need not be paid while being diligently contested in good faith and
by appropriate proceedings so long as (i) adequate book reserves have been established with respect
thereto in accordance with GAAP and (ii) no NYTEX Party’s title to or right to use its property is
materially adversely affected by such non-payment. Each of Parent and the Company shall timely
file, and shall cause the other NYTEX Parties to file, all tax returns required to be filed in
connection with the payment of taxes required by this Section 8.2.




     8.3. Compliance With Law. Each of Parent and the Company shall, and shall cause
each of the other NYTEX Parties to comply, in all material respects, with all Applicable Law,
franchises, authorizations, licenses and permits of, and all applicable restrictions imposed by,
any Governmental Authority in respect of the conduct of its business and the ownership of its
properties (including all Environmental Laws and all Applicable Law, franchises, authorizations,
licenses and permits relating to fair labor standards, equal employment opportunities and
occupational health and safety).



     8.4. Environmental Matters. Each of Parent and the Company shall, and shall cause
each of the other NYTEX Parties to: (a) conduct its operations and keep and maintain all real
property owned or used by it in compliance with all Environmental Laws and Environmental Permits
other than noncompliance that could not reasonably be expected to have a Material Adverse Effect;
(b) implement any and all investigations, remediations, removals and response actions that are
appropriate or necessary to maintain the value and marketability of such real property or to
otherwise comply with Environmental Laws and Environmental Permits pertaining to the presence,
generation, treatment, storage, use, disposal, transportation or Release of any Hazardous Substance
on, at, in, under, above, to, from or about any of such real property; (c) notify the Purchaser
promptly after any Responsible Officer of a NYTEX Party has knowledge of any violation of
Environmental Laws or Environmental Permits or any Release on, at, in, under, above, to, from or
about any such real property that is reasonably likely to result in material liabilities in the
aggregate; and (d) promptly forward to the Purchaser a copy of any order, notice, request for
information or any communication or report received by any NYTEX Party in connection with any such
violation or Release or any other matter relating to any Environmental Laws or Environmental
Permits that could reasonably be expected to result in material liabilities in the aggregate, in
each case whether or not the Environmental Protection Agency or any Governmental Authority has
taken or threatened any action in connection with any such violation, Release or other matter. If
the Purchaser at any time has a reasonable basis to believe that there may be a violation of any
Environmental Laws or Environmental Permits by any NYTEX Party or any liability arising thereunder,
or a Release of Hazardous Substances on, at, in, under, above, to, from or about any of such real
property, that, in each case, could reasonably be expected to have a Material Adverse Effect, then
upon the Purchaser’s written request Parent or the Company shall, and shall cause the other NYTEX
Parties to, (i) cause the performance of such environmental audits including subsurface sampling of
soil and groundwater, and preparation of such environmental reports, at Parent’s or the Company’s
expense, as the Purchaser may from time to time reasonably request, which shall be conducted



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by reputable environmental consulting firms reasonably acceptable to the Purchaser and shall
be in form and substance reasonably acceptable to the Purchaser, and (ii) permit the Purchaser or
its representatives to have access to all such real property for the purpose of conducting such
environmental audits and testing as the Purchaser deems appropriate, including subsurface sampling
of soil and groundwater. Parent or the Company shall reimburse the Purchaser upon demand for the
costs of such audits and tests.




     8.5. Insurance.



     (a) Each of Parent and the Company shall maintain, and shall cause each of the other NYTEX
Parties to maintain, with independent insurers reasonably believed by Parent and the Company to be
financially sound and reputable, (i) property damage and casualty insurance on all real and
personal property of the NYTEX Parties on an all risks basis, with broad form flood and earthquake
coverages and electronic data processing coverage, with a full replacement cost endorsement and an
“agreed amount” clause in an amount equal to 100% of the full replacement cost of such property,
and (ii) other insurance with respect to its business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or similar business, of such types and
in such amounts as are customarily carried under similar circumstances by such other Persons,
including in any event workers’ compensation insurance, public liability (including
products/completed operations liability coverage) and business interruption insurance. The coverage
amounts of such insurance shall not be materially reduced by any NYTEX Party in the absence of
thirty (30) days’ prior written notice to the Purchaser. All property damage and casualty
insurance shall name the Purchaser as lender loss payee/mortgagee, all liability insurance shall
name the Purchaser as an additional insured and all business interruption insurance shall name the
Purchaser as assignee.



     (b) All policies of property and casualty insurance shall provide for at least thirty (30)
days’ prior written cancellation notice to the Purchaser. In the event of failure by any NYTEX
Party to provide and maintain insurance as herein provided, the Purchaser may, at its option,
provide such insurance and charge the amount thereof to Parent or the Company. Parent or the
Company shall furnish the Purchaser upon its request with certificates of insurance and policies
evidencing compliance with the foregoing insurance provision.



     (c) Within six (6) months after the Closing Date, the NYTEX Parties shall obtain key man
life insurance on Michael K. Galvis and Michael G. Francis, in an amount to be agreed on by Parent
and the Purchaser.



     8.6. Use of Proceeds. The proceeds from the sale and issuance of the Shares and
the Warrants shall be used by Parent and the Company solely to pay all or part of the purchase
price of the Acquisition Transaction and fees and expenses incurred by any NYTEX Party.



     8.7. Further Assurances. Each of Parent and the Company shall, and shall cause
the other NYTEX Parties to, execute such documents and other papers and take such further actions,
as the Purchaser may reasonably request to carry out the provisions hereof and the transactions
contemplated hereby.



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     8.8. Dissolution of Certain Subsidiaries. Within thirty (30) days following the
date hereof (or such later date as Purchaser may, in its sole discretion, agree in writing), Parent
shall dissolve or cause to be dissolved each of the following Subsidiaries: (a) Supreme Fluid
Service Partners LLC, (b) Pyburn Services, Inc. and (c) Superior Chemical Corporation.



     Section 9. Negative Covenants. Each of Parent and the Company covenants and
agrees that so long as the Purchaser shall (i) meet the Share Condition, or (ii) solely with
respect to Sections 9.4, 9.5(a), 9.6, 9.7, 9.8 and 9.12, meet the Common Stock Condition:



     9.1. Restrictions on Indebtedness. Each of Parent and the Company shall not, and shall
not permit any other NYTEX Party to, incur, create, assume, guarantee or in any way become liable
for, or permit to exist, Indebtedness other than:



     (a) Indebtedness of the Company and its Subsidiaries represented by the Senior Debt
Documents;



     (b) Indebtedness represented by the Subordinated Debt Documents;



     (c) Indebtedness of the Company and its Subsidiaries for Capital Expenditures permitted by
section 10.2; and



     (d) Other Indebtedness not to exceed $250,000 in the aggregate at any time outstanding.



     9.2. Restrictions on Liens. Each of Parent and the Company shall not, and shall
not permit any other NYTEX Party to, directly or indirectly, create, assume or suffer to exist any
Lien upon any of their respective properties or assets whether now owned or hereafter acquired,
except for the following (the “Permitted Liens”):



     (a) Liens for taxes, assessments, governmental charges or claims the payment of which is
not at the time required by Section 8.2;



     (b) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics,
materialmen and other Liens imposed by law incurred in the Ordinary Course of Business for sums,
the payment of which is not at the time required by Section 8.2;



     (c) Liens (other than any Lien imposed by ERISA, and other than any Lien securing an
obligation for the payment of borrowed money or for the deferred purchase price of property or
services) incurred or deposits made in the Ordinary Course of Business in connection with
obligations not due or delinquent with respect to workers’ compensation, unemployment insurance and
other types of social security, or to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government contracts, performance and return of money bonds
and other similar obligations;



     (d) zoning restrictions, easements, licenses, reservations, restrictions on the use of
real property or minor irregularities incident thereto (and, with respect to leasehold interests,
Liens and other encumbrances that are incurred, created, assumed or permitted to exist on or with
respect to the leased property and arise by, through or under or are asserted by a landlord or



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owner of the leased property, with or without consent of the lessee) which were not incurred
in connection with the borrowing of money and which do not in the aggregate materially detract from
the value of the property of any NYTEX Party, as the case may be, or impair the use of such
property for the purposes for which such property is held by such NYTEX Party;




     (e) Liens existing on the Closing Date;



     (f) any Lien on property of a Subsidiary of the Company existing at the time it becomes
such a Subsidiary;



     (g) the Liens created by the Senior Debt Documents



     (h) purchase money security interests granted in any NYTEX Parties in the Ordinary Course
of Business to secure not more than one hundred percent (100%) of the purchase price of assets
(including Capitalized Leases); and



     (i) the extension, renewal or replacement of any Lien permitted by subsection (e) or (f)
of this Section 9.2, but only if the principal amount of the Indebtedness secured by such Lien
immediately prior to such extension, renewal or replacement is not increased and the Lien is not
extended to other property.



     9.3. Limitation on Sale and Leasebacks. Each of Parent and the Company shall not,
and shall not permit any other NYTEX Party to:



     (a) enter into any Sale and Leaseback Transaction other than any Sale and Leaseback
Transaction for which the lease is a Capitalized Lease and the Capitalized Lease is permitted under
Section 9.1(c); or



     (b) enter into any Synthetic Lease.



     9.4. Mergers, Consolidations, Sales of Assets and Acquisitions. Each of Parent
and the Company shall not, and shall not permit any other NYTEX Party to, (a) consolidate with or
be a party to a merger with any other Person, or (b) sell or otherwise Dispose of any or all of the
assets of any NYTEX Party, or any of the Equity Interests of any direct or indirect Subsidiary of
any NYTEX Party, or (c) acquire by purchase or otherwise a majority of any class of the Equity
Interests of any Person, or all or substantially all of the business or property of any Person or
of any operating division or line of business of any Person, except with the prior written consent
of the Purchaser.



     9.5. Conduct of Business.



     (a) Each of Parent and the Company shall not, and shall not permit any other NYTEX Party
to, (i) engage in any business or activities other than the Business and any businesses or
activities substantially similar or related thereto or (ii) conduct the Business and any businesses
or activities substantially similar or related thereto other than in accordance with the Budget.



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     (b) Each of Parent and the Company shall not modify, alter or change the Budget by an
amount in excess of $200,000, individually or in the aggregate, without the prior written consent
of the Purchaser.



     9.6. Restricted Payments and Restricted Investments.



     (a) Each of Parent and the Company shall not, and shall not permit any other NYTEX Party
to, directly or indirectly, make any Restricted Payment, except (i) the declaration and payment of
dividends and distributions by the Company on the Shares, (ii) the declaration and payment of
dividends and distributions by Parent on the outstanding the shares of Series A Preferred Stock;
provided that such payments shall not be made (but may accrue) during the existence of an
Event of Default; (iii) the declaration and payment of dividends and distributions by a
Wholly-owned Subsidiary of the Company on its outstanding Equity Interests to the Company or to
another Wholly-owned Subsidiary of the Company; and (iv) the payment of the annual Management Fee
to the extent permitted by Section 9.8.



     (b) Each of Parent and the Company shall not, and shall not permit any other NYTEX Party
to, directly or indirectly make any Restricted Investment.



     9.7. Issuance of Stock by Subsidiaries. The Company shall not permit any of its
Subsidiaries to issue or have outstanding any of its shares of preferred stock or other Preferred
Equity Interests (or any warrants, options, conversion rights or other rights to subscribe for,
purchase or acquire such preferred stock or other Preferred Equity Interests) other than shares of
such preferred stock or Preferred Equity Interests owned by the Company or a Wholly-owned
Subsidiary of the Company.



     9.8. Transactions with Affiliates. Each of Parent and the Company shall not, and
shall not permit any other NYTEX Party to, directly or indirectly, enter into or permit to exist
any transaction (including the purchase, sale, lease or exchange of any property or the rendering
of any service), with any Affiliate of the Company (other than the Purchaser) or such Subsidiary,
except Parent shall be entitled to the Management Fee, payable in equal monthly installments of
$62,5000, so long as (a) no Default or Event of Default exists at the time of each such payment or
after giving effect thereto and (b) the Company and its Subsidiaries are in pro forma compliance
with the covenants set forth in Section 10 both immediately before and after giving effect to each
such payment installment.



     9.9. Operating Leases. Each of Parent and the Company shall not, and shall not
permit any of the other NYTEX Parties to, enter into (as lessee) any lease of real or personal
property (other than Capitalized Leases) having a term greater than one year (including options to
renew or extend any term, whether or not exercised) if, after giving effect thereto, the aggregate
amount of rentals and other payments required to be made by the NYTEX Parties during any fiscal
year of the Company under all such leases would be greater than $500,000.



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     9.10. Contingent Obligations. The Company shall not, and shall not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist any Contingent Obligations except:




     (a) Contingent Obligations incurred pursuant to this Agreement and the other Transaction
Documents;



     (b) Contingent Obligations incurred pursuant to the Senior Debt Documents;



     (c) Swap Contracts entered into in the Ordinary Course of Business for bona fide hedging
purposes and not for purposes of speculation;



     (d) Contingent Obligations of the Company and its Subsidiaries existing as of the Closing
Date and listed in Schedule 9.10(d), including extensions and renewals thereof which do not
increase the amount of such Contingent Obligations as of the date of such extension or renewal;



     (e) Contingent Obligations incurred in the Ordinary Course of Business with respect to
surety and appeal bonds, performance bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money);



     (f) Contingent Obligations resulting from endorsements for collection or deposit in the
Ordinary Course of Business;



     (g) Contingent Obligations arising under indemnity agreements to title insurers to cause
such title insurers to issue title insurance policies required hereunder; and



     (h) Contingent Obligations arising with respect to customary indemnification obligations
in favor of purchasers in connection with Dispositions permitted under Section 9.4(g).



     9.11. Limitation on Dividend Restrictions Affecting Subsidiaries. Except pursuant
to this Agreement and the Senior Debt Documents, the Company shall not permit any of its
Subsidiaries directly or indirectly to create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction which by its terms restricts the ability of any
such Subsidiary to (a) pay dividends or make any other distributions on such Subsidiary’s Equity
Interests, (b) pay any Indebtedness owed to the Company or any other Subsidiary of the Company, (c)
make any loans or advances to the Company or any other Subsidiary of the Company or (d) transfer
any of its property or assets to the Company or any other Subsidiary of the Company.



     9.12. Compliance with ERISA. Each of Parent and the Company shall not, and shall
not permit any other NYTEX Party to:



     (a) terminate any Plan subject to Title IV of ERISA so as to result in any material
liability to the Company or any ERISA Affiliate;



     (b) permit to exist any ERISA Event or any other event or condition, which would
reasonably be expected to have a Material Adverse Effect;



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     (c) make a complete or partial withdrawal (within the meaning of ERISA Section 4201) from
any Multiemployer Plan so as to result in any material liability to the Company or any ERISA
Affiliate;



     (d) enter into any new Pension Plan or Multiemployer Plan or modify any existing Pension
Plan so as to increase its obligations thereunder which would reasonably be expected to have a
Material Adverse Effect; or



     (e) permit the present value of all nonforfeitable accrued benefits under any Pension Plan
subject to Title IV of ERISA (using the actuarial assumptions utilized by the PBGC upon termination
of a Plan) materially to exceed the fair market value of Plan assets allocable to such benefits,
all determined as of the most recent valuation date for each such Plan.



     9.13. Litigation. Each of Parent and the Company shall not, and shall not permit
any of the other NYTEX Parties to, settle, or agree to indemnify or defend third parties against,
any material lawsuit, (a) except as may be required by judicial or regulatory order or by
agreements entered into prior to the date hereof on a basis consistent with past practice or (b),
in the case of a settlement, unless the terms of the settlement require the NYTEX Parties to make
payments and transfers of less than $500,000 in the aggregate. For the purpose of this Section
9.13, a material lawsuit shall be any lawsuit in which the amount in controversy exceeds $500,000.



     9.14. Accounting Changes. Each of Parent and the Company shall not, and shall not
permit any of the other NYTEX Parties to, (a) make any material change in accounting treatment or
reporting practices, except any material change required by GAAP and which is approved in writing
by the Accountants, or (b) adopt or utilize any change in GAAP or the application thereof for
purposes of determining compliance with the covenants contained in Section 9 and 10 or elsewhere
herein except as permitted by Section 1.2(c).



     9.15. No Amendments to Certain Other Documents. Each of Parent and the Company
shall not, and shall not permit any other NYTEX Party to, without the prior written consent of the
Purchaser, (a) make any material changes in its equity capital structure (including in the terms of
its authorized or outstanding capital stock), (b) permit any amendment to, modification of or
supplement to the Organizational Documents of the Company or any Subsidiary of the Company
(including the filing of any certificate establishing, setting forth, amending, modifying or
supplementing the designations, preferences or rights pertaining to or other terms of any class or
series of capital stock of any NYTEX Party), or (c) permit any amendment to, modification of or
supplement to the Subordinated Debt Documents.



     Section 10. Financial Covenants. The Company covenants and agrees that so long as
the Purchaser shall hold any of the Shares, the Company shall not:



     10.1. Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio to be
less than 1.10 to 1.00, measured as of (a) November 30, 2010, for the fiscal quarter then most
recently ended; (b) February 28, 2011, for the two fiscal quarter period then most recently ended;
(c) May 31, 2011, for the three fiscal quarter period then most recently ended; (d) August 31, 2011
and as of the last day of each fiscal quarter thereafter, for the four fiscal quarter period then
most recently ended.



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     10.2. Capital Expenditures. Contract for, purchase or make, or permit any other
NYTEX Party to contract for, purchase or make, Capital Expenditures other than Capital Expenditures
that, in the aggregate for all NYTEX Parties, do not exceed (a) $5,200,000 for the twelve (12)
months immediately following the Closing Date and (ii) $5,000,000 for each twelve (12) month period
thereafter.



     10.3. Leverage Ratio. Permit the Leverage Ratio as of the last day of each fiscal
quarter of the Company to be greater than 2.75:1.0 for such period.



     10.4. Minimum EBITDA. Permit EBITDA for any period of four fiscal quarters then
most recently ended to be less than $11,250,000 for such period.



     Section 11. Events of Default.



     11.1. Events of Default; Remedies. If any of the following events (herein called
“Events of Default”) shall have occurred and be continuing during the time that the Shares
Condition is met (whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or by operation of law or otherwise):



     (a) the Company shall default in the due and punctual payment or redemption of all or any
part of the Principal Amount, or redemption charge (if any), when and as the same shall become due
and payable to the holders of the Shares in accordance with this Agreement or the Senior Series A
Certificate of Designations, whether at stated maturity, by acceleration, by notice of redemption
or otherwise;



     (b) the Company shall default in the due and punctual payment of any dividend on any of
the Shares when and as such dividend shall become due and payable in accordance with this Agreement
or the Senior Series A Certificate of Designations;



     (c) Parent or the Company shall default in the performance or observance of any of the
covenants, agreements or conditions contained in Section 6(a), Section 6(b), Section 6(c), Section
6(d), Section 6(h), Section 8.2(a), Section 8.2(c), Section 8.6, Section 8.6(b), Section 8.8,
Section 9, and Section 10;



     (d) any NYTEX Party shall default in the performance or observance of any of the
covenants, agreements or conditions contained in this Agreement or any of the other Transaction
Documents (other than those referred to in any subsection of this Section 11.1 other than this
subsection (d)), and such default shall continue for a period of thirty (30) days;



     (e) (i) the Company or any of its Subsidiaries shall fail to pay any principal of, or
interest on, or any other amount payable in respect of Indebtedness of such Person, in an
individual or aggregate amount greater than $250,000, that is outstanding when the same becomes due
and payable (whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise), and such failure shall continue after the applicable grace period, if any, specified in
the agreement or instrument relating to such Indebtedness; or (ii) any other event shall occur or
condition shall exist under any agreement or instrument relating to any such Indebtedness in an
individual or aggregate amount greater than $250,000 and shall continue after



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the applicable grace period, if any, specified in such agreement or instrument, if the effect
of such event or condition is to permit the acceleration of the maturity of such Indebtedness
(whether or not such acceleration occurs); or (iii) any such Indebtedness in an individual or
aggregate amount greater than $250,000 shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled required prepayment), redeemed, purchased or defeased,
or an offer to prepay, redeem, purchase or defease such Indebtedness shall be required to be made,
in each case prior to the stated maturity thereof;




     (f) any NYTEX Party shall (i) voluntarily commence any proceeding or file any petition
seeking relief under the Bankruptcy Code, or any other federal, state or foreign bankruptcy,
insolvency, receivership or similar law, (ii) consent to the institution of, or fail to contest in
a timely and appropriate manner, any proceeding or the filing of any petition described in (g)
below, (iii) apply for or consent to the appointment of a receiver, trustee, custodian,
sequestrator, conservator or similar official for the Company or any of its Subsidiaries, or for a
substantial part of the property or assets of the Company or any of its Subsidiaries, (iv) file an
answer admitting the material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors, (vi) admit in writing its inability to
pay its debts as they become due or (vii) take any action for the purpose of effecting any of the
foregoing;



     (g) an involuntary proceeding shall be commenced or an involuntary petition shall be filed
in a court of competent jurisdiction seeking (i) relief in respect of any NYTEX Party, or of a
substantial part of the property or assets of the Company or any of its Subsidiaries, under the
Bankruptcy Code, or any other federal, state or foreign bankruptcy, insolvency, receivership or
similar law, (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for any NYTEX Party, or for a substantial part of the property or assets of any
NYTEX Party, or (iii) the winding-up or liquidation of any NYTEX Party, and such proceeding or
petition shall continue undismissed for sixty (60) days, or an order or decree approving or
ordering any of the foregoing shall be entered;



     (h) final judgment for the payment of money shall be rendered by a court of competent
jurisdiction against any NYTEX Party, and such NYTEX Party, as the case may be, shall not discharge
the same or provide for its discharge in accordance with its terms, or procure a stay of execution
thereof, within thirty (30) days from the date of entry thereof and within said period of thirty
(30) days, or such longer period during which execution of such judgment shall have been stayed,
appeal therefrom and cause the execution thereof to be stayed during such appeal, and such judgment
together with all other such judgments shall exceed in the aggregate $1,000,000;



     (i) any representation, warranty or statement made by or on behalf of any NYTEX Party or
by or on behalf of any officer of any NYTEX Party in this Agreement or any other Transaction
Document, or in any financial statement, certificate or other instrument or document now or
hereafter delivered pursuant to or in connection with any provision of this Agreement or the other
Transaction Documents, shall prove to be false or incorrect or breached in any material respect on
the date as of which made;



     (j) a Change of Control shall occur;



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     (k) (i) an ERISA Event shall occur with respect to a Pension Plan or a Multiemployer Plan
which shall have resulted or could reasonably be expected to result in liability of the Company or
any ERISA Affiliate under Title IV of ERISA to such Pension Plan or Multiemployer Plan or to the
PBGC in an aggregate amount in excess of $250,000; (ii) the Company or any ERISA Affiliate shall
fail to pay when due, after the expiration of any applicable grace period, any installment payment
with respect to its Withdrawal Liabilities under a Multiemployer Plan, in an aggregate amount in
excess of $250,000; or (iii) the aggregate amount of Unfunded Pension Liabilities among all Pension
Plans at any time shall exceed $250,000;



     (l) any provision of this Agreement or any other Transaction Document shall, for any
reason, not be or shall cease to be in full force and effect, or not be, or be asserted in writing
by the Company or any of its Subsidiaries not to be, valid, binding and enforceable against any
Person purported to be bound by it;



     (m) the Company or any Subsidiary of the Company shall fail to observe or perform any
material covenant, condition or agreement contained in any Material Contract and such failure shall
continue unremedied for a period equal to the lesser of (a) thirty (30) days and (b) any applicable
cure period set forth in such Material Contract, if in any event such failure could reasonably be
expected to have a Material Adverse Effect; or any Material Contract shall be cancelled or
terminated by a party thereto other than the Company or any Subsidiary of the Company and prior to
its scheduled date of expiration or termination, if such cancellation or termination could
reasonably be expected to have a Material Adverse Effect; or



     (n) any Material Adverse Effect shall occur;


then (i) upon the occurrence of any Event of Default described in subsection (f) or (g), the unpaid
principal amount of all of the Shares, together with all dividends accrued thereon and all fees,
costs, expenses, indemnities and other amounts payable hereunder or under any of the other
Transaction Documents (including an amount equal to the redemption charge (if any) that would have
been payable if the Shares had then been voluntarily redeemed), shall automatically become
immediately due and payable in exchange for the redemption of the Shares, without presentment,
demand, notice, declaration, protest or other requirements of any kind, all of which are hereby
expressly waived, or (ii) upon the occurrence of any other Event of Default, the Purchaser may, by
written notice to the Company, declare the entire unpaid principal amount of the Shares to be
immediately due and payable in exchange for the redemption of the Shares, together with all
interest accrued thereon and all fees, costs, expenses, indemnities and other amounts payable
hereunder or under any of the other Transaction Documents (including an amount equal to the
redemption charge (if any) that would have been payable if the Shares had then been voluntarily
redeemed), in which event all such principal, interest, premium and other amounts shall thereupon
be immediately due and payable, all without presentment, demand, notice, protest or other
requirements of any kind, all of which are hereby expressly waived.




     11.2. Suits for Enforcement. If any Event of Default shall have occurred and be
continuing, the Purchaser may proceed to protect and enforce its rights, either by suit in equity
or by action at law, or both, whether for the specific performance of any covenant or agreement
contained in this Agreement or the other Transaction Documents or in aid of the exercise of any



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power granted in this Agreement or the other Transaction Documents, and the Purchaser may
proceed to enforce the payment of all sums due upon the Shares or under this Agreement or any other
Transaction Document, and such further amounts as shall be sufficient to cover the costs and
expenses of collection (including reasonable counsel fees and disbursements), or to enforce any
other legal or equitable right of the Purchaser.




     11.3. Remedies Cumulative. No remedy conferred upon the Purchaser in this
Agreement or in any of the other Transaction Documents is intended to be exclusive of any other
remedy and each and every such remedy shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or in equity or otherwise.



     11.4. Remedies Not Waived. No course of dealing between the Company and the
Purchaser, and no delay or failure in exercising any rights under this Agreement or any of the
other Transaction Documents, shall operate as a waiver of any of the rights of the Purchaser.



     Section 12. Put Right. At any time on or after the earlier to occur of (a) the
date on which a Change of Control occurs, (b) the date on which an Event of Default occurs, (c) the
date on which the Company elects to redeem the Shares in accordance with the Senior Series A
Certificate of Designations and (d) the Maturity Date (each such date, a “Put Event Date”), the
Purchaser may elect to cause Parent to repurchase the Warrants held by the Purchaser on such Put
Event Date (the “Put Securities”) by providing written notice of such election to the Company (the
“Put Election Notice”). Parent shall repurchase the Put Securities from the Purchaser for an
amount (“Put Payment Amount”) equal to the greater of (i) the Purchaser’s aggregate equity
ownership percentage in Parent as of the Put Event Date, multiplied by the Equity Value as of the
Put Event Date and (ii)(A) in the event that the Put Event Date occurs prior to the third (3rd)
anniversary following the Closing Date, $30,000,000 and, (B) in the event that the Put Event Date
occurs on or after the third (3rd) anniversary following Closing Date, $40,000,000 (in each of
subsection (A) and (B), inclusive of any and all amounts paid by Parent or the Company pursuant to
this Agreement or the Senior Series A Redeemable Preferred Stock Certificate of Designations in
respect of the Principal Amount, the Closing Fee and dividends on the Shares). Parent shall pay
the cost of determining the Equity Value. The Company shall pay the Put Payment Amount to the
Purchaser promptly after receipt of the Put Election Notice (but in no event more than five (5)
Business Days after receipt thereof) by wire transfer of immediately available funds to the bank
account designated by the Purchaser in the Put Election Notice.



     Section 13. Miscellaneous.



     13.1. Amendment and Waiver.



     (a) Any term, provision, covenant, agreement or condition of this Agreement may be amended
or waived only by a writing, signed by the party or parties to be bound or burdened by such
amendment or waiver.



     (b) No failure or delay by the Purchaser in exercising any right, remedy, power or
privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or



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the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and
privileges herein provided are cumulative and are not exclusive of any rights, remedies, powers and
privileges provided by law.




     13.2. Expenses.



     (a) The Company agrees, whether or not the transactions hereby contemplated shall be
consummated, to pay and save the Purchaser and its Affiliates harmless against any and all
liability for the payment of all reasonable, out-of-pocket expenses arising in connection with this
Agreement and the other Transaction Documents, including all expenses incurred in connection with
(i) the reproduction of such agreements and instruments and all stamp and other similar taxes
(together in each case with interest and penalties, if any) which may be payable in respect of the
execution and delivery of such agreements or instruments or the issuance, delivery or acquisition
by the Purchaser of any of the Shares, the Warrants or other instrument pursuant to this Agreement,
(ii) the fees and disbursements of Winston & Strawn LLP incurred in connection with the performance
of due diligence in respect of the NYTEX Parties, the preparation and negotiation of this Agreement
and the other Transaction Documents, and the consummation of the transactions hereby and thereby
contemplated, and (iii) the expenses of the Purchaser incurred in connection with its investigation
of the business, assets and financial condition of the NYTEX Parties, including the fees and
disbursements of any accountants or other experts retained by the Purchaser for such purposes.



     (b) The Company also agrees to pay to the Purchaser on demand all expenses hereafter
incurred by the Purchaser (including reasonable counsel fees and disbursements) from time to time
in connection with (i) the enforcement, attempted enforcement or preservation of any of the rights
or remedies of the Purchaser under this Agreement or any of the other Transaction Documents, (ii)
any amendment or requested amendment of, or waiver or consent or requested waiver or consent under
or with respect to, this Agreement or any of the other Transaction Documents, whether or not the
same shall become effective and (iii) attendance by the Observer at meetings of the boards of
directors of the NYTEX Parties as permitted by Section 7.2.



     (c) The Obligations of the Company under this Section 13.2 shall survive the payment or
prepayment in full or transfer of any Shares, the enforcement of any provision of this Agreement or
the other Transaction Documents, any such amendments, waivers or consents, and any such workout,
restructuring or similar arrangement.



     13.3. Survival of Representations and Warranties. All representations and
warranties contained herein or made in writing by or on behalf of any party to this Agreement or
otherwise in connection herewith shall (a) survive the execution and delivery of this Agreement and
the delivery of the Shares and the Warrants to the Purchaser and shall continue in effect while the
Purchaser shall hold any of the Shares, and thereafter as provided in Section 13.2 and Section
13.6, and (b) be deemed to be material and to have been relied upon by the Purchaser, regardless of
any investigation made by the Purchaser or on its behalf.



     13.4. Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns, provided
that the



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Company may not transfer or assign any of its rights or Obligations hereunder or under the
other Transaction Documents without the prior written consent of the Purchaser. Without limiting
the generality of the foregoing, at any time and from time to time and without any notice to or
consent by the Company, the Purchaser may (a) sell or otherwise Dispose of any or all of the Shares
and the Warrants in accordance with Applicable Law, and (b) pledge and grant a security interest in
any or all of the Shares and the Warrants, and in all of its rights and interests under this
Agreement and the other Transaction Documents to secure Indebtedness incurred by the Purchaser, and
in the event of any foreclosure of such pledge and security interest, the secured party thereof may
sell and assign such Shares and Warrants, together with all rights and interests of the Purchaser
under this Agreement and the other Transaction Documents, in a public or private sale and may
exercise all other rights of a secured party with respect thereto in accordance with the
documentation governing such Indebtedness and Applicable Law.




     13.5. Notices. All notices hereunder shall be in writing and shall be
conclusively deemed to have been received and shall be effective (a) on the day on which delivered
if delivered personally or transmitted by facsimile transmission, (b) one (1) Business Day after
the date on which the same is delivered to a nationally recognized overnight courier service, (c)
three (3) Business Days after being sent by registered or certified United States mail, return
receipt requested, or (d) if sent by e-mail as provided below, and shall be addressed:




	 	(i)	 	if to the Purchaser, to:
	 
	 	 	 	WayPoint Nytex, LLC

c/o WayPoint Capital Partners, LLC

555 Theodore Fremd Avenue, Suite C207

Rye, New York 10580

Attention: Mr. Thomas W. Drechsler

Phone: (914) 417-6960

Facsimile: (914) 417-6961
	 
	 	 	 	with a copy (which shall not constitute notice) to:
	 
	 	 	 	Winston & Strawn LLP

200 Park Avenue

New York, New York 10166

Attention: Mr. Bradley C. Vaiana

Telephone: (212) 294-2610

Facsimile: (212) 294-4700;
	 
	 	(ii)	 	if to the Company or Parent, to:
	 
	 	 	 	NYTEX Energy Holdings, Inc.

12222 Merit Drive, Suite 1850

Dallas, Texas 75251

Attention: Mr. Kenneth Conte

Telephone: (972) 770-4700

Facsimile: (972) 770-4701




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	 	 	 	with a copy (which shall not constitute notice) to:
	 
	 	 	 	Strasburger & Price, LLP

901 Main Street, Suite 4400

Dallas, Texas 75202

Attention: Mr. Kevin Woltjen

Telephone: (214) 651-2344

Facsimile: (214) 659-4025




or to such other address or addresses or telecopy number or numbers as any of such Persons may most
recently have designated in writing to the others by such notice. Notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement
from the intended recipient (such as by the “return receipt requested” function, as available,
return e-mail or other written acknowledgement), provided that if such notice or other
communication is not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on the next Business
Day.




     13.6. Indemnification. In consideration of the execution and delivery of this
Agreement by the Purchaser, Parent, the Company hereby agrees to defend, indemnify, exonerate and
hold harmless the Purchaser and each of the Purchaser’s officers, directors, stockholders,
Affiliates, trustees, employees and agents (herein collectively called the “Indemnitees”) from and
against any and all liabilities, obligations, losses, damages, claims, actions, suits, proceedings,
judgments, costs and expenses, including legal fees and other expenses incurred in the
investigation, defense, appeal and settlement of claims, actions, suits and proceedings (herein
collectively called the “Indemnified Liabilities”), incurred by the Indemnitees or any of them
arising out of or resulting from any act or failure to act by any NYTEX Party or their respective
officers, directors, employees, agents, representatives or Affiliates (other than the Purchaser)
relating to:



     (a) this Agreement, any of the other Transaction Documents, the issuance of the Shares or
the Warrants or the transactions contemplated hereby or thereby, or the performance by the Company
of its Obligations hereunder or thereunder,



     (b) any Environmental Matter, any Environmental Law or the actual or alleged existence or
release of any Hazardous Substance, or



     (c) Parent’s exploration and production assets and subsidiaries, including the Restricted
Subsidiaries, Panhandle Field Producing and Development Property and Bluff Creek.


except for any such Indemnified Liabilities which are finally judicially determined to have
resulted from the Indemnitee’s gross negligence or willful misconduct, and if and to the extent
that the foregoing undertaking may be unenforceable for any reason, each of Parent and the Company
hereby agrees to make the maximum contribution to the payment and satisfaction of each of the
Indemnified Liabilities which is permissible under Applicable Law. The Obligations of Parent and
the Company under this Section 13.6 shall survive the payment or prepayment in full or transfer of
any of the Shares and the enforcement of any provision hereof or thereof.







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     13.7. Confidentiality. (a) The Purchaser shall maintain in confidence in
accordance with its customary procedures for handling confidential information and not disclose to
any Person, all written information clearly marked “Confidential” that the Company or any of its
Subsidiaries, or any of their authorized representatives, furnishes to the Purchaser on a
confidential basis (“Confidential Information”), other than any such Confidential Information that
becomes generally available to the public other than as a result of a breach by the Purchaser of
its obligations hereunder or that is or becomes available to the Purchaser from a source other than
the NYTEX Parties, or any of their authorized representatives, and that is not, to the actual
knowledge of the recipient thereof, subject to obligations of confidentiality with respect thereto;
provided, however, that the Purchaser shall in any event have the right to deliver
copies of any such documents, and to disclose any such information, to:



          (i) its directors, officers, trustees, partners, employees, agents and attorneys;



          (ii) its Affiliates, accountants, investment advisers, other professional consultants and
rating agencies, and the directors, officers, trustees, partners, employees, agents and attorneys
of each of the foregoing;



          (iii) any Person to which the Purchaser offers to sell or pledge, or sells or pledges, any
of the Shares or any part thereof or interest, and any other Person which offers to provide or is
providing financing to the Purchaser; provided such Person agrees to keep such information
confidential on terms similar to those set forth in this Section 13.7;



          (iv) the SEC and any other federal or state regulatory authority or examiner which
regulates or has jurisdiction over the Purchaser; and



          (v) any other Person to which such delivery or disclosure may be necessary or appropriate
(A) in order to comply with any Applicable Law, (B) in response to any subpoena or other legal
process or informal investigative demand, (C) in connection with any litigation to which the
Purchaser is a party, or (D) in connection with the enforcement of the rights and remedies of the
Purchaser under this Agreement and the other Transaction Documents at any time when an Event of
Default shall have occurred and be continuing (with respect to clauses (A), (B) and (C) of this
subparagraph (v), in each case upon prior written notice to Parent to the extent reasonably
practicable and not prohibited by law or court order, so that Parent may, at its sole cost and
expense, contest such disclosure or seek confidential treatment thereof).



     (b) Notwithstanding any other provision contained herein, on or about the Closing Date,
the Purchaser shall have the right to issue a press release or other public statement, in form and
substance as shall be determined by the Purchaser in its sole discretion, with respect to the
transactions contemplated by this Agreement and the other Transaction Documents, and thereafter may
from time to time issue such press releases or other public statements with respect to its
investment in Parent and the Company as the Purchaser may reasonably determine to be necessary or
advisable in order to comply with the requirements of federal and state securities laws, rules and
regulations or the rules of any securities exchange (including the Nasdaq Stock Market, Inc.) on
which the Purchaser’s securities may be traded. The Purchaser shall also have the right to list
Parent and the Company as a portfolio company of the Purchaser on the web site



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or sites owned and maintained by the Purchaser and in any other marketing materials as the
Purchaser, in its sole discretion, shall determine.




     13.8. Punitive Damages. Each party to this Agreement agrees that it shall not
have a remedy of punitive, special, exemplary, indirect or consequential damages against any other
party to this Agreement in connection with any claim or dispute arising hereunder and hereby waives
any right or claim to any such damages that such party now has or which may arise in the future in
connection with any such claim or dispute, whether such claim or dispute is resolved by arbitration
or judicially.



     13.9. Integration and Severability. This Agreement embodies the entire agreement
and understanding among the Purchaser, Parent and the Company, and supersedes all prior agreements
and understandings relating to the subject matter hereof. In case any one or more of the
provisions contained in this Agreement or in any instrument contemplated hereby for such date, or
any application thereof, shall be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein and therein, and any other
application thereof, shall not in any way be affected or impaired thereby.



     13.10. Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original but all of which shall together constitute one and the
same instrument. Delivery of an executed counterpart of a signature page of this Agreement by
telecopy or other electronic means shall be effective as delivery of a manually executed
counterpart of this Agreement. Delivery of manually executed counterparts of this Agreement shall
immediately follow delivery by telecopy or other electronic means, but the failure to so deliver a
manually executed counterpart shall not affect the validity, enforceability, or binding effect
hereof.



     13.11. Governing Law. THIS AGREEMENT AND THE NOTES SHALL BE CONSTRUED IN
ACCORDANCE WITH AND SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CHOICE OF LAW EXCEPT AS SET FORTH IN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW.



     13.12. Submission to Jurisdiction; Waiver of Service and Venue.



     (a) EACH OF PARENT AND THE COMPANY CONSENTS AND AGREES TO THE NON-EXCLUSIVE JURISDICTION
OF ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY OF NEW YORK, STATE OF NEW YORK, AND WAIVES ANY
OBJECTION BASED ON VENUE OR FORUM NON CONVENIENS WITH RESPECT TO ANY ACTION INSTITUTED THEREIN.



     (b) EACH OF PARENT AND THE COMPANY HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS
UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY HAND DELIVERY OR BY REGISTERED
OR CERTIFIED UNITED STATES MAIL TO THE COMPANY AT ITS ADDRESS SET FORTH IN SECTION 13.5.



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     (c) NOTHING IN THIS SECTION 13.12 SHALL AFFECT THE RIGHT OF THE PURCHASER TO SERVE LEGAL
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT OF THE PURCHASER TO BRING ANY
ACTION OR PROCEEDING AGAINST PARENT, THE COMPANY OR THEIR RESPECTIVE PROPERTIES IN THE COURTS OF
ANY OTHER JURISDICTION.



     13.13. Waiver of Right to Trial by Jury. EACH OF PARENT, THE COMPANY AND THE
PURCHASER HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
(a) ARISING UNDER THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH OR (b) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO OR ANY OF THEM IN RESPECT TO THIS AGREEMENT OR ANY OTHER INSTRUMENT,
DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED
HERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR
TORT OR OTHERWISE. PARENT, THE COMPANY AND THE PURCHASER HEREBY AGREE AND CONSENT THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT
ANY PARTY MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.



     Section 14. Replacement of Shares. Upon request of the Purchaser, the Company
shall issue and deliver at its expense, in replacement of the certificate(s) representing the
Shares lost, stolen, damaged or destroyed, upon surrender thereof, if mutilated, a new
certificate(s) representing such Shares in the same aggregate amount, and otherwise of the same
tenor, as the certificate(s) so lost, stolen, damaged or destroyed, duly executed by the Company.
The Company may condition the replacement of a certificate representing any Shares reported by the
Purchaser as lost, stolen, damaged or destroyed, upon the receipt from the Purchaser of an
indemnity reasonably satisfactory to the Company.



[Signature page follows]









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IN WITNESS WHEREOF, Parent, the Company and the Purchaser have executed this Agreement by their
duly authorized officers as of the date first written above.




	 	 	 	 	 
	 	NYTEX ENERGY HOLDINGS, INC.

 	 
	 	By:  	

 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	NYTEX FDF ACQUISITION, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	WAYPOINT NYTEX, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



[Signature Page to Senior Series A Preferred Stock and Warrant Purchase Agreement]




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