Document:

Second Amendment to Amended and Restated Credit Agreement

 Exhibit 10.1 
 SECOND AMENDMENT 
 TO 
 AMENDED AND RESTATED CREDIT AGREEMENT 
 THIS SECOND AMENDMENT (the
“Second Amendment” or this “Amendment”) dated as of February 4, 2008 (“Effective Date”), is between Flotek Industries, Inc., a Delaware corporation (the “Borrower”), and Wells
Fargo Bank, National Association, a national banking association, as lender (the “Bank”). 
 RECITALS 
 A. The Borrower and the Bank are parties to a Amended and Restated Credit Agreement dated as of August 31, 2007 (as amended, modified or
supplemented prior to the date hereof, the “Credit Agreement”), pursuant to which the Bank agreed to make loans to, and issue letters of credit on behalf of, the Borrower. 
 B. The Borrower intends to issue up to $150,000,000 of senior, unsecured convertible notes (the “Offering”) proceeds of which will be
used to fund the acquisition (the “Acquisition”) of substantially all of the assets of Teledrift, Inc. (“Teledrift”) and for general corporate purposes. 
 C. The issuance of indebtedness under the Offering and the Acquisition are not permitted under the Credit Agreement. 
 D. The Borrower and the Bank had originally contemplated entering into a new, syndicated revolving and term credit facility (the “New
Facility”) to be agented by the Bank which New Facility would have permitted the Offering and the Acquisition. 
 E. To avoid a
delay in commencing the Offering process which may occur as a result of the time and efforts necessary to complete the due diligence and documentation process related to the New Facility, the Borrower has asked the Bank to consent to the Offering
and the Acquisition directly under the Credit Agreement. 
 F. Subject to the terms and conditions set forth herein, the Bank is willing to
permit the Offering and the Acquisition under the Credit Agreement, and in connection therewith, wishes to make certain amendments to the Credit Agreement. 
 NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set forth in this Amendment, the Borrower and the Bank agree as follows: 
 1. Defined Terms. Unless otherwise defined herein, capitalized terms used herein have the meanings assigned to them in the Credit Agreement.

 2. Amendments. The following provisions of the Credit Agreement are hereby amended as follows: 
  

 (a) Section 1.01 of the Credit Agreement is hereby amended by adding the following
new defined terms in alphabetical order: 
 “Convertible Senior Notes” means the senior, unsecured
convertible notes of the Borrower issued pursuant to the Indenture and in an amount not to exceed an aggregate principal amount of $150,000,000. 
 “Equipment Loan Maturity Date” means the Working Capital Loan Maturity Date. 
 “Indenture” means the Indenture to be entered into on or before the date of the completion of the offering of the Convertible Senior Notes by and among the Borrower, the subsidiary guarantors party thereto, and the
trustee thereunder that will govern the Convertible Senior Notes. 
 “Second Amendment” means that
certain Second Amendment to Amended and Restated Credit Agreement dated as of February 4, 2008. 
 “Senior
Leverage Ratio” means, as of any date of determination, the ratio of (a) senior, secured Indebtedness of the Borrower at such date to (b) EBITDA for the 12 month period ending on such date. 
 “Senior Note Prepayment Date” means the date on which the Borrower is required to pay any holder of the Convertible
Unsecured Debentures as a result of the conversion into cash by such holder of all or any portion of the Convertible Unsecured Debentures or as a result of the repurchase by the Borrower of all or any portion the Convertible Unsecured Debentures
held by such holder, in either case, as a result of (a) any optional or voluntary repurchase, redemption, prepayment, repayment, defeasance or any other acquisition or retirement for value (or the segregation of funds with respect to any of the
foregoing) of such Convertible Unsecured Debentures, (b) the occurrence of any fundamental change, as described in the Indenture or the Convertible Unsecured Debentures, or (c) any action taken by the Borrower, including the distribution
of stock rights, warrants, or other distributions to holders of its common stock. 
 “Teledrift
Acquisition” means the acquisition by the Borrower of substantially all of the assets of Teledrift, Inc. 
 “Term Loan” means, collectively, the Equipment Loan and the Real Estate Loan. 
 (b)
Section 1.01 of the Credit Agreement is hereby further amended by replacing the defined term “Working Capital Loan Maturity Date” in its entirety with the following: 
 “Working Capital Loan Maturity Date” means February 4, 2011. 
 (c) Sections 3.03(a) and 3.03(b) of the Credit Agreement are hereby amended to read in their entirety as follows: 
 SECTION 3.03 Interest. 
  

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 (a) Each Base Rate Advance shall bear interest on the unpaid principal amount thereof at a rate per
annum equal to the lesser of (i) the Alternate Base Rate plus 2.75% and (ii) the Highest Lawful Rate. 
 (b) Each Eurodollar
Advance shall bear interest on the unpaid principal amount thereof at a rate per annum equal to the lesser of (i) the Adjusted LIBO Rate for the Interest Period in effect for such Advance plus 3.75% and (ii) the Highest Lawful Rate. 

 (d) Section 3.04(b) of the Credit Agreement is hereby amended to read in its entirety as follows: 
 (b) The Borrower hereby promises to pay the principal on the Equipment Loan in quarterly installments of $2,000,000.00 each, payable on the last day of
each calendar quarter commencing with June 30, 2008, and a final installment of the remaining, unpaid principal balance of the Equipment Loan payable on the Equipment Loan Maturity Date. 
 (e) Section 3.06 of the Credit Agreement is hereby amended in its entirety to read as follows: 
 SECTION 3.06 Mandatory Prepayments. 
 (a) In the event any Working Capital Loan Borrowing Base Certificate submitted pursuant to Section 7.02 reflects that the Working Capital Exposure exceeds the Working Capital Loan Borrowing Base, the Borrower shall promptly
make a prepayment in an aggregate principal amount equal to such excess. 
 (b) Within 15 days after the delivery of annual financial
statements of the Borrower and its Subsidiaries for the fiscal year ending December 31, 2008, and each fiscal year thereafter, as contemplated by Section 7.02(a), the Borrower shall repay the Equipment Loan, without premium or
penalty, in an amount equal to 50% of Excess Cash Flow for such fiscal year. 
 (c) On each Debenture Payment Date, the Borrower shall
prepay the Equipment Loan in an aggregate amount equal to the principal payment being made on such date under the Convertible Senior Notes. 
 (d) On each date the Borrower or any of its Subsidiaries issues debt (other than under the Convertible Senior Notes and regardless of whether such debt is permitted hereunder), the Borrower shall prepay the Equipment Loan in an amount
equal to 100% of the net proceeds of such debt issuance. 
 (e) If the Borrower or any Subsidiary of the Borrower completes an asset
sale (regardless of whether such sale is permitted under the terms hereof) and the proceeds thereof are not reinvested within 90 days after the completion of such asset sale in assets which would become collateral for the Obligations to the extent
the sold assets were collateral for the Obligations, then upon the expiration of such 90 day period the Borrower shall prepay the Equipment Loan in an amount equal to 100% of such Net Proceeds of such asset sale which have not been so reinvested;
provided that, (i) this clause (e) shall not apply to Net Proceeds from any individual asset sale (whether completed as a single transaction or a series of transaction) which are less than $500,000 so long as the aggregate amount of Net
Proceeds which are not applied to this 

  

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clause (e) does not exceed $2,000,000, and (ii) this clause (e) shall not apply to the sale of inventory in the ordinary course of
business. 
 (e) If the outstanding balance under the Equipment Loan exceeds 75% of the OLV of Fixed Assets (as defined in the Second
Amendment and as set forth in the appraisals required to be delivered under the Second Amendment) which constitute Collateral, but subject to the proviso below, the Borrower shall either (i) prepay the Equipment Loan in an amount equal to such
excess or (ii) within thirty (30) days after the earlier of (A) the delivery of the last of such appraisals by the Borrower to the Bank and (B) April 4, 2008, provide the Bank with unencumbered, additional collateral such
that after giving effect thereto the outstanding balance under the Equipment Loan shall not exceed 75% of the OLV of Fixed Assets that constitute Collateral; provided that if the Borrower fails to deliver such required appraisals on or prior to
April 4, 2008, then the “OLV of Fixed Assets” for purposes of this clause (e) shall mean the orderly liquidation value of the Borrower’s and its Subsidiaries’ fixed assets (other than unencumbered real estate with an
estimated fair market value of greater than $1,000,000) as determined by the Bank in its reasonable discretion and based on the appraisals and reports available to the Bank at such time. 
 (f) On the effective date of the Second Amendment, the Borrower shall prepay the Equipment Loan so that the outstanding principal amount thereof on
such effective date does not exceed $40,000,000. Notwithstanding anything to the contrary contained herein but subject to the availability requirement under Section 4(e) of the Second Amendment, the Borrower may make such prepayment with an
Advance under the Working Capital Loan. 
 (g) Any prepayment of the Equipment Loan hereunder shall be applied to the remaining
installments of the Equipment Loan in inverse order of maturity. 
 (f) Section 3.07 of the Credit Agreement is
hereby replaced in its entirety with the following; 
 SECTION 3.07 Fees. 
 (a) The Borrower shall pay to the Bank a commitment fee equal to .50% per annum on the average daily amount by which the Working Capital Loan
Commitment exceeds the outstanding Working Capital Exposure. Such fee is due quarterly in arrears on each March 31, June 30, September 30 and December 31 and on the Working Capital Loan Maturity Date. 
 (b) The Borrower shall pay to the Bank the following fees with respect to Letters of Credit: 
 (i) a letter of credit fee for each Letter of Credit issued hereunder in an amount equal to 3.75% per annum (calculated on the
basis of a 360 day year) on the face amount of such Letter of Credit for the period such Letter of Credit is outstanding. Such fee shall be due and payable quarterly in arrears on March 31, June 30, September 30, and
December 31 of each year, and on the Working Capital Loan Maturity Date; and 
 (ii) Such other usual and
customary fees associated with any transfers, amendments, drawings, negotiations or reissuances of any Letters of Credit. Such fees 

  

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shall be due and payable as requested by the Bank in accordance with the Bank’s then current fee policy. 
 (g) Section 8.02 of the Credit Agreement is hereby amended by replacing the period at the end of clause (e) with a semicolon and
adding the following new clause (f) to the end thereof: 
 (f) Indebtedness represented by the Convertible Senior Notes pursuant to
the Indenture and the subsidiary guarantees thereof pursuant to the Indenture; provided that (i) all of such Indebtedness shall have been issued under the initial issuance thereof or under the over-allotment option exercised by the underwriters
thereof, (ii) immediately before and immediately after giving effect to the issuance of such Indebtedness, no Default or Event of Default shall have occurred or be continuing, and (iii) such Indebtedness shall not have (A) any
affirmative or negative covenant (including financial covenants) that is more restrictive than those set forth in this Agreement, provided that the inclusion of any covenant that is customary with respect to such type of Indebtedness and that is not
found in this Agreement shall not be deemed to be more restrictive for purposes of this clause (f), (B) any restriction on the ability of the Borrower or any of its Subsidiaries to amend, modify, restate or otherwise supplement this Agreement
or the other Loan Documents, (C) any restriction on the ability of the Borrower to enter into a syndicated revolving and/or term loan facilities the proceeds of which would, in part, refinance the Advances outstanding hereunder (a “New
Facility”), regardless of whether such New Facility is evidenced under a new credit agreement or as an amendment and restatement of this Agreement, (D) any collateral or other security for such Indebtedness, (E) any restrictions on
the ability of any Subsidiary of the Borrower to guarantee the Obligations (as such Obligations may be amended, supplemented, modified, or amended and restated) or the obligations under the New Facility, (F) any restrictions on the ability of
any Subsidiary or the Borrower to pledge assets as collateral security for the Obligations (as such Obligations may be amended, supplemented, modified, or amended and restated) or the obligations under the New Facility or (G) a scheduled
maturity date that is earlier than June 30, 2011. 
 (h) Section 8.11 of the Credit Agreement is hereby amended
by replacing the period at the end of clause (ii) with a semicolon and adding the following new clause (iii) to the end thereof: 
 (iii) The Borrower may, directly or indirectly through one of its Subsidiaries, complete the Teledrift Acquisition; provided that, (a) the Bank has been provided a copy of the purchase document related to such
acquisition and the terms of such acquisition are acceptable to the Bank in its reasonable discretion, and (b) if such acquisition is completed through a Subsidiary, such Subsidiary is a Guarantor and substantially all of the assets acquired
thereunder would, upon completion thereof, constitute Collateral. 
 (i) Sections 8.08, 8.09 and 8.13 of the Credit
Agreement are hereby replaced in their entirety with the following: 
 SECTION 8.08 Leverage Ratio. Permit the Leverage Ratio as of
each fiscal quarter end to be more than (a) 3.50 to 1.0 for each fiscal quarter ending prior to September 30, 2008, (b) 3.0 to 1.0 for each fiscal quarter ending on or after September 30, 2008 but prior to March 31, 2009;
(c)2.75 to 1.0 for each fiscal quarter ending on or 

  

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after March 31, 2009 but prior to September 30, 2009, and (d) 2.50 to 1.0 for each fiscal quarter ending on or after September 30,
2009. 
 SECTION 8.09 Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio as of each fiscal quarter end to be
less than 1.25 to 1.0. 
 SECTION 8.13 Capital Expenditures. The Borrower shall not permit the aggregate Capital Expenditures by
the Borrower and its Subsidiaries in any fiscal year to exceed $20,000,000. 
 (j) Article VIII of the Credit Agreement
is hereby amended by adding the following new Sections 8.15, 8.16 and 8.17 to the end thereof: 
 Section 8.15 – Convertible
Senior Notes. 
 (a) The Borrower will not, after the initial issuance of the Convertible Senior Notes, amend, modify, waive or
otherwise change, or consent or agree to any amendment, modification, waiver or other change to the Convertible Senior Notes or the Indenture (i) which shortens the fixed maturity, or increases the rate or shortens the time of payment of
interest on, or increases the amount or shortens the time of payment of any principal or premium payable whether at maturity, at a date fixed for prepayment, by acceleration, by mandatory redemption, repayment, prepayment, or defeasance for cash or
otherwise of such Convertible Senior Notes, or increases the amount of, or accelerates the time of payment of, any fees payable in connection therewith; (ii) which relates to the affirmative or negative covenants, events of default or remedies
under the documents or instruments evidencing such Indebtedness and the effect of which is to subject the Borrower or any of its Subsidiaries, to any provisions that are more onerous or more restrictive provisions than those set forth in this
Agreement; or (iii) which otherwise adversely affects the interests of the Bank as senior creditor or the interests of the Bank under this Agreement or any other Loan Document in any material respect. 
 (b) The Borrower will not make or offer to make any optional or voluntary repurchase, redemption, prepayment, repayment, defeasance or any other
acquisition or retirement for value (or the segregation of funds with respect to any of the foregoing) (whether in whole or in part) of any of the Convertible Senior Notes. 
 Section 8.16 –Minimum Net Worth. Permit the Borrower’s Net Worth (as defined below) as of the end of each fiscal quarter,
commencing with the quarter ending March 31, 2008, to be less than an amount equal to (i) 80% of the Borrower’s Net Worth as of the end of the fiscal quarter ended December 31, 2007 plus (ii) an amount equal to 75% of the
Borrower’s consolidated Net Income for each fiscal quarter ending after December 31, 2007 in which such consolidated Net Income is greater than $0 plus (iii) an amount equal to 100% of equity issuance proceeds received by the Borrower
or any Subsidiary after December 31, 2007. “Net Worth” means, as to the Borrower, the consolidated shareholder’s equity of the Borrower and its Subsidiaries (determined in accordance with GAAP). 
 SECTION 8.17 Senior Leverage Ratio. Permit the Senior Leverage Ratio as of each fiscal quarter end to be more than 2.00 to 1.00. 

(k) Section 9.01(j) of the Credit Agreement is hereby deleted in its entirety to read as follows: 
  

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 (j) Intentionally Omitted. 
 3. Agreements. 
 (a)
Appraisals. On or prior to April 4, 2008, the Borrower shall delivered to the Bank written appraisals and/or written updates to previously delivered appraisals, in each case, conducted by an industry recognized third party appraiser
setting forth, among other things, the orderly liquidation value (the “OLV of Fixed Assets”) of all of the Borrower’s and its Subsidiaries’ fixed assets (other than unencumbered real property with an estimated fair market
value of greater than $1,000,000 as determined by the Borrower and the Bank in their reasonable discretion) which appraisals and updates shall be in form satisfactory to the Bank in its reasonable discretion. 
 (b) New Facility. The Borrower agrees to (i) provide the Bank with such material and other reasonable assistance necessary to complete the
due diligence efforts of the Bank in connection with the documentation and closing of the New Facility and (ii) to negotiate, execute and deliver such loan documents governing such New Facility in form and substance that would be acceptable to
the bank loan syndication and capital markets in order to achieve a successful syndication of the New Facility, as detailed in, and based on, the fee letter, commitment letter and term sheet dated the date hereof and referred to in
Section 4(b)(ii) below. 
 4. Conditions to Effectiveness. This Amendment shall become effective on the date on which the
following conditions have been satisfied or waived: 
 (a) the representations and warranties of the Borrower set forth in
Section 4 hereof shall be true and correct; 
 (b) the Bank shall have received: (i) this Amendment duly executed
and delivered to the Bank by the Borrower and executed by the Bank, and (ii) a fee letter, commitment letter and term sheet related to this Amendment and the New Facility and with terms acceptable to the Bank; 
 (c) each Guarantor shall have executed and delivered an acknowledgment and consent to this Amendment substantially in the form of Exhibit
A hereto; 
 (d) the Borrower shall have paid to the Bank, in immediately available funds, the fees required to be paid with
the delivery of this Amendment under the fee letter referenced in clause (b) above; 
 (e) after giving effect to any
Advances that may be made on the date hereof to refinance the Equipment Loan as required under the Credit Agreement, as amended hereby, the Working Capital Exposure under the Credit Agreement shall not be greater than $20,000,000; and 
 (f) the Borrower shall have paid or reimbursed the Bank for all of its out-of-pocket costs and expenses incurred in connection with this
Amendment, any other documents prepared in connection herewith and the transactions contemplated hereby, including, without limitation, the fees and disbursements of counsel(s) to the Bank. 
  

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 5. Representations and Warranties. The Borrower hereby represents and warrants to the Bank as
follows: 
 (a) this Amendment has been duly authorized by all necessary corporate action and constitutes the binding
obligation of the Borrower; 
 (b) each of the representations and warranties made by the Borrower or its Subsidiaries in or
pursuant to the Credit Agreement and the other Loan Documents is true and correct in all material respects as of the date hereof, as if made (after giving effect to this Amendment) on and as of such date, except for any representations and
warranties made as of a specified date, which are true and correct in all material respects as of such specified date; 
 (c)
no Default has occurred and is continuing as of the date hereof or will result from the execution and delivery of this Amendment; and 
 (d) This Amendment is a Loan Document for the purposes of the provisions of the other Loan Documents. Without limiting the foregoing, any breach of representations, warranties, covenants and agreements under this
Amendment by the Borrower shall be a Default or Event of Default, as applicable, under the Credit Agreement. 
 6. Continuing Effect of
the Credit Agreement. This Amendment shall not constitute a waiver of any provision of the Credit Agreement and shall not be construed as a consent to any action on the part of the Borrower that would require a waiver or consent of the Bank or
an amendment or modification to any term of the Loan Documents except as expressly stated herein. The Borrower hereby confirms and ratifies the Credit Agreement and each of the other Loan Documents as amended hereby and acknowledges and agrees that
the same shall continue in full force and effect as amended hereby. 
 7. Reference to the Credit Agreement. Upon the effectiveness of
this Amendment, each reference in the Credit Agreement to “this Credit Agreement,” “hereunder,” “herein” or words of like import, and each reference to the Credit Agreement in any of the other Loan Documents, refer to
the Credit Agreement, as amended hereby. 
 8. Counterparts. This Amendment may be executed by all parties hereto in any number of
separate counterparts each of which may be delivered in original, electronic or facsimile form and all of such counterparts taken together shall be deemed to constitute one and the same instrument. 
 9. References. The words “hereby,” “herein,” “hereinabove,” “hereinafter,” “hereinbelow,”
“hereof,” “hereunder” and words of similar import when used in this Amendment refer to this Amendment as a whole and not to any particular section or provision of this Amendment. 
 10. Headings Descriptive. The headings of the several sections of this Amendment are inserted for convenience only and do not in any way affect
the meaning or construction of any provision of this Amendment. 
  

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 11. Governing Law. This Amendment shall be governed by and construed in accordance with the law of
the State of Texas, without regard to such state’s conflict of laws rules that would require the application of the laws of another jurisdiction. 
 12. Release. The Borrower hereby releases and forever discharges the Bank and each affiliate thereof and each of their respective employees, officers, directors, trustees, agents, attorneys,
successors, assigns or other representatives from any and all claims, demands, damages, actions, cross-actions, causes of action, costs and expenses (including legal expenses), of any kind or nature whatsoever, whether based on law or equity, which
any of said parties has held or may now or in the future own or hold, whether known or unknown, for or because of any matter or thing done, omitted or suffered to be done on or before the actual date upon which this Amendment is signed by any of
such parties (i) arising directly or indirectly out of the Credit Agreement as amended or any other documents, instruments or any other transactions relating thereto and/or (ii) relating directly or indirectly to all transactions by and
between the Borrower or their representatives and the Bank or any of their respective directors, officers, agents, employees, attorneys or other representatives, including any such that is caused by the negligence of any released party. Such
release, waiver, acquittal and discharge shall and does include, without limitation, any claims of usury, fraud, duress, misrepresentation, lender liability, control, exercise of remedies and all similar items and claims, which may, or could be,
asserted by the Borrower. 
 13. Final Agreement of the Parties. THIS AMENDMENT, THE CREDIT AGREEMENT AND THE OTHER LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES. 
  

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 IN WITNESS WHEREOF, the parties are signing this Amendment as of the date first above written.

  

			
	FLOTEK INDUSTRIES, INC.
		
	By:	 	/s/ Jerry D. Dumas
	Name:	 	Jerry D. Dumas
	Title:	 	Chairman and Chief Executive Officer

  

 Signature Page To Second Amendment 

			
	 WELLS FARGO BANK,
 NATIONAL
ASSOCIATION

		
	By:	 	/s/ Bret West
	Name:	 	 
	Title:	 	 

  

 Signature Page To Second Amendment 

 EXHIBIT A 
 ACKNOWLEDGMENT AND CONSENT 
 In connection with the Second Amendment (the “Second
Amendment”) to the Amended and Restated Credit Agreement dated as of August 31, 2007 (the ‘Credit Agreement”), which Second Amendment is dated February 4, 2007, between Flotek Industries, Inc., a Delaware corporation
(the “Borrower”), and Wells Fargo Bank, National Association, each of the undersigned persons, as a Guarantor under the Guaranty made by each such Person in favor of the Bank in connection with the Loans to be advanced under the
Credit Agreement, (a) acknowledges the execution and delivery of the Amendment by the Borrower and the effect of the provisions of the Amendment and (b) confirms and agrees that as of the date hereof, after giving effect to the provisions
of the Amendment, the Guaranty is, and continues to be, in full force and effect and is hereby ratified and confirmed in all respects and that the Guaranty and all of the Collateral secure, and shall continue to secure, the payment of all of the
Obligations pursuant to the terms of the Guaranty and the Security Agreement, as the case may be. Capitalized terms used herein without definition have the meanings assigned to them in the Credit Agreement. 
  

			
	 CESI CHEMICAL, INC.
 TELEDRIFT
ACQUISITION, INC.
 FLOTEK PAYMASTER, INC.
 MATERIAL
TRANSLOGISTICS, INC.
 PADKO INTERNATIONAL, INC.
 PETROVALVE, INC.
 SPIDLE SALES & SERVICE, INC.
 TRINITY TOOL, INC.
 TURBECO, INC.
 USA PETROVALVE, INC.
 SOONER ENERGY SERVICES, INC.
 CAVO DRILLING MOTORS, LTD. CO.

		
	By:	 	 
		 	         Lisa Meier
         Chief Financial Officer

  

 Exhibit AAsset Purchase Agreement

 Exhibit 10.2 
 EXECUTION COPY 
 ASSET PURCHASE AGREEMENT 
 THIS ASSET PURCHASE AGREEMENT, dated as of February 4th, 2008 (the
“Agreement”), is by and among Teledrift Acquisition, Inc., a Delaware corporation (“Purchaser”), Flotek Industries, Inc., a Delaware corporation (“Flotek”), Teledrift, Inc. an Oklahoma corporation
(“Teledrift”), and the following stockholders of Teledrift: Floyd Bergen, Dean DuCray, Max Weldon, and Manoj Gopalan (referred to herein collectively as the “Stockholders,” or individually as a
“Stockholder”). 
 RECITALS: 
 WHEREAS, Purchaser desires to acquire substantially all of the assets of Teledrift; 
 WHEREAS, Teledrift
desires to sell to the Purchaser substantially all of its assets in exchange for the consideration herein provided; and 
 WHEREAS, the
Stockholders own all of the stock of Teledrift and therefore will materially benefit from the consummation of the transactions contemplated herein; 
 NOW, THEREFORE, in consideration of the premises and the representations, warranties, covenants and agreements contained herein, the parties hereto, intending to be legally bound, agree as follows: 
 ARTICLE I 
 THE PURCHASE

 Section 1.1 Purchase. On and subject to the terms and conditions of this Agreement, at the Closing, Purchaser will
purchase from Teledrift, and Teledrift will sell to Purchaser, the following assets, rights, properties, and interests of Teledrift (the “Acquired Assets”): 
 (a) All land described on Schedule 1.1(a) hereto, together with all buildings, structures, improvements, and fixtures located thereon, and all easements
and other rights and interests appurtenant thereto; 
 (b) All rental tools, machinery, equipment, furniture, computers, office supplies,
vehicles, fixtures, and other items of tangible personal property; 
 (c) All Intellectual Property (as defined in Section 9.1)
including the Intellectual Property described on Schedule 1.1(c) hereto; 
 (d) All leasehold rights pursuant to any lease of real or
personal property including the leases described on Schedule 1.1(d) hereto (the “Assigned Leases”); 
 (e) All rights under
any Contracts including the Contracts and purchase orders described on Schedule 1.1(e) (the “Assigned Contracts”); 

 (f) All files, books, ledgers, customer lists, correspondence, drawings, specifications, studies,
reports, and records, other than corporate records relating to the organization or governance of Teledrift and tax records; 
 (g) All
inventories of finished goods, tooling inventory, parts, work in progress and raw materials as of the Effective Time; 
 (h) All accounts
receivable as of the Effective Time; 
 (i) All franchises, approvals, permits, licenses, orders, registrations, certificates,
authorizations, variances, and similar rights obtained from Governmental Authorities to the extent assignable. 
 (j) All prepaid items
including all equipment, lease and other deposits existing as of the Effective Time but excluding prepaid Taxes and prepaid insurance; 
 (k)
All of the goodwill of Teledrift and all of the rights of Teledrift to use the tradename “Teledrift, Inc.” or any similar name; and 
 (l) Claims, deposits, prepayments, refunds, causes of action, choses in action, rights of recovery, rights of set off, and rights of recoupment ((i) relating to the Acquired Assets, or (ii) arising under any guarantees, warranties or
rights against suppliers and manufacturers) with respect to any of the other Acquired Assets listed under this Section 1 but excluding such items to the extent relating to Taxes and insurance policies maintained by Teledrift prior to the
Closing. 
 Section 1.2 Excluded Assets. Notwithstanding the foregoing, the Acquired Assets shall not include the cash of
Teledrift, the prepaid Taxes and prepaid insurance of Teledrift, or any of the assets listed on Schedule 1.2 (collectively, the “Retained Assets”). 
 Section 1.3 Purchase Price for Acquired Assets. As consideration for the sale to it of the Acquired Assets, Purchaser shall (i) assume the accounts payable of Teledrift as provided in this
Section 1.3, (ii) assume certain obligations of Teledrift pursuant to the Assigned Contracts as provided in this Section 1.3, and (iii) pay Teledrift a purchase price (the “Purchase Price”) equal to Ninety-Five
Million Two Hundred Thousand Dollars ($95,200,000). Purchaser shall at the Closing: 
 (a) Pay Teledrift $95,200,000 in cash payable by wire
transfer or the delivery of other immediately available funds; 
 (b) Assume the accounts payable (as defined pursuant to GAAP) of Teledrift
as of the Effective Time which are either (i) reflected in the September 30, 2007 balance sheet of Teledrift included in Financial Statements, (ii) reflected in the Disclosure Schedules, or (iii) incurred in the ordinary course
of business after September 30, 2007; and 
 (c) Assume from Teledrift any obligation to perform pursuant to the express terms of any
Assigned Contract which is disclosed in the Disclosure Schedule, which accrues subsequent to the Effective Time. 
  

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 The Liabilities of Teledrift which will be assumed by Purchaser pursuant to the terms of this
Section 1.3 are referred to herein collectively as the “Assumed Liabilities.” 
 Section 1.4 No Assumption
of Liabilities. Except as expressly provided for in Section 1.3, Purchaser has not and will not assume from Teledrift any Liability. Specifically, but not by way of limitation, Purchaser shall not assume the following Liabilities of
Teledrift: 
 (a) any Liability for income Taxes; 
 (b) any Liability for Taxes (other than income Taxes) arising with respect to conduct of the Business through the Effective Time; 
 (c) any Liability to indemnify any Person (including any of the Stockholders) by reason of the fact that such Person was, a director, officer, employee, or agent of any entity or was serving at the request of any such
entity as a partner, trustee, director, officer, employee, or agent of another entity (whether such indemnification is for judgments, damages, penalties, fines, costs, amounts paid in settlement, losses, expenses, or otherwise and whether such
indemnification is pursuant to any statute, charter document, bylaw, agreement or otherwise); 
 (d) any Liability for costs and expenses
incurred by Teledrift or any Stockholder in connection with this Agreement and the Transactions; 
 (e) any Liability of Teledrift under this
Agreement (or under any agreement between Teledrift on the one hand and Purchaser on the other hand entered into on or after the date of this Agreement); 
 (f) any Liability for Funded Debt; 
 (g) any Liability arising prior to the Effective Time, or as a result
of the Closing, to any employee, agent, or independent contractor of Teledrift, whether or not employed by Purchaser after the Effective Time, or under any benefit arrangement maintained by or for the benefit of Teledrift with respect thereto;

 (h) any Liability for wages, commissions, vacation, holiday, workers’ compensation and sick pay obligations with respect to employees
of Teledrift, accrued through the Effective Time and all bonuses and fringe benefits as to such employees accrued through the Effective Time, and all severance pay obligations to such employees, if any, resulting from the consummation of the
transactions contemplated by the Agreement; and 
 (i) any Liability arising out of any employee benefit plan maintained by or covering
employees of Teledrift, or to which Teledrift has made any contribution or to which Teledrift could be subject to any Liability. 
 Section 1.5 Net Assets Adjustment. In the event that the Net Assets as of the Effective Time varies from the Targeted Net Asset Amount (as such terms are defined in Section 9.1), the Purchase Price shall be adjusted
upwards or downwards to the extent that the net impact of such variance exceeds $1,000,000. The procedure for determining whether an adjustment shall be made pursuant to this Section 1.5 is set forth in Appendix A. 
  

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 Section 1.6 Prorations. Except as otherwise set forth in this Agreement, the following
prorations relating to the Acquired Assets will be made as of the Effective Time, with Teledrift liable to the extent such items relate to any time period on or prior to the Effective Time and Purchaser liable to the extent such items relate to
periods after the Effective Time: (i) ad valorem, personal property, real estate, occupancy and other similar property Taxes, if any, on or with respect to the Acquired Assets; and (ii) the amount of charges for water, telephone,
electricity and other utilities. The net amount of all such prorations will be settled and paid at the Closing. In the event that the amount of any of the items to be prorated pursuant to this Section 1.6 is not known by Teledrift and Purchaser
at the Closing, the proration shall be made based upon the amount of the most recent cost of such item to Teledrift. After Closing, Purchaser and Teledrift each shall provide to the other, promptly after receipt, each third party invoice relating to
any items so estimated. Within ten (10) business days thereafter, Purchaser and Teledrift shall make any payments to the other that are necessary to compensate for any difference between the proration made at the Closing and the correct
proration based on the third party invoice, and amounts owed by Teledrift shall remain the responsibility of Teledrift and amounts owed by Purchaser shall be considered an Assumed Liability. 
 Section 1.7 Allocation. The consideration paid for the Acquired Assets and the Restrictive Covenants, together with any Assumed
Liabilities, shall be allocated as shown on an allocation schedule (the “Allocation Schedule”) to be prepared by Purchaser and approved by Teledrift as soon as may be reasonably practicable. The allocation set forth in such
Allocation Schedule shall comply with the rules of Section 1060 of the Code and the treasury regulations promulgated thereunder. Except to the extent that a contrary position is required by law, Purchaser and Teledrift agree to be bound by the
allocation set forth in the Allocation Schedule for all purposes of Tax reporting, including the filing of IRS Form 8594 in accordance with the Allocation Schedule, and the filing of an amended IRS Form 8594 in the event a revised Allocation
Schedule is deemed necessary by Purchaser. The Allocation Schedule shall include an allocation by state where necessary to calculate applicable state sales or transfer taxes applicable to the transaction. 
 Section 1.8 Closing. The closing (the “Closing”) of the Transaction shall take place at the offices of counsel to
Purchaser in Houston, Texas on the earliest of the following two dates to occur: (i) the date which is specified by Purchaser, which shall not be later than five days following the date of the closing of the Financing (as hereinafter defined)
or (ii) the Termination Date, or at such other time and place as Purchaser and Teledrift shall agree. At the Closing, each of the parties hereto will take actions and execute such documents and instruments as may be reasonably required to
consummate the Transaction. The date on which the Closing occurs is referred to in this Agreement as the “Closing Date.” At the Closing, each of the parties shall take such actions as shall be required pursuant to the terms hereof
to be taken at the Closing, or which are otherwise reasonably required to cause the Transaction to be consummated. The Closing shall be effective as of 12:01 a.m. Houston Texas time on the Closing Date (the “Effective Time”).

 Section 1.9 Definitions; Rules of Construction 
 (a) The definitions of certain terms are set forth in Section 9.1. An index indicating the locations of the definitions of certain terms used herein
is set forth in Section 9.2. 
  

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 (b) All article, section, schedule and exhibit references used in this Agreement are to articles,
sections, schedules and exhibits to this Agreement unless otherwise specified. The schedules and exhibits attached to this Agreement constitute a part of this Agreement and are incorporated herein for all purposes. 
 (c) If a term is defined as one part of speech (such as a noun), it shall have a corresponding meaning when used as another part of speech (such as a
verb). Terms defined in the singular have the corresponding meanings in the plural, and vice versa. Unless the context of this Agreement clearly requires otherwise, words importing the masculine gender shall include the feminine and neutral genders
and vice versa. The term “includes” or “including” shall mean “including without limitation.” The words “hereof,” “hereto,” “hereby,” “herein,” “hereunder” and words of
similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular section or article in which such words appear. 
 (d) The Parties acknowledge that each Party and its attorney has reviewed this Agreement and that any rule of construction to the effect that any ambiguities are to be resolved against the drafting Party, or any
similar rule operating against the drafter of an agreement, shall not be applicable to the construction or interpretation of this Agreement. 
 (e) The captions in this Agreement are for convenience only and shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement. 
 (f) All references to currency herein shall be to, and all payments required hereunder shall be paid in, US dollars. 
 (g) Except as specifically provided otherwise in this Agreement, all accounting terms used herein that are not specifically defined shall have the
meanings customarily given them pursuant to GAAP. 
 ARTICLE II 
 REPRESENTATIONS AND WARRANTIES OF PURCHASER AND FLOTEK 
 Purchaser and Flotek,
jointly and severally represent and warrant to Teledrift and the Stockholders as follows: 
 Section 2.1 Organization and
Qualification. Each of Purchaser and Flotek is a corporation duly organized, validly existing and in good standing under the laws of the state of its incorporation and has the requisite corporate power and authority to own, lease and operate
its assets and properties and to carry on its business as it is now being conducted. 
 Section 2.2 Authority; Non Contravention;
Approvals. 
 (a) Each of Purchaser and Flotek has full corporate power and authority to execute and deliver this Agreement and to
consummate the Transaction. This Agreement has 

  

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been approved by the Boards of Directors of Purchaser and Flotek, and no other corporate proceedings on the part of Purchaser and Flotek, including, without
limitation, any stockholder approval with respect to Purchaser or Flotek, are necessary to authorize the execution and delivery of this Agreement or the consummation by Purchaser or Flotek of the Transaction, including, without limitation, under the
applicable requirements of any securities exchange. This Agreement has been duly executed and delivered by Purchaser and Flotek, and, assuming the due authorization, execution and delivery hereof by Teledrift and the Stockholders, constitutes a
valid and legally binding agreement of Purchaser and Flotek enforceable against it in accordance with its terms, except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles. 
 (b) The execution and
delivery of this Agreement by Purchaser and the consummation by Purchaser and Flotek of the Transaction does not and will not violate or result in a breach of any provision of, or constitute a default (or an event which, with notice or lapse of time
or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, or result in a right of termination or acceleration under, or result in the creation of any Lien upon any of the properties or
assets of Purchaser or Flotek under any of the terms, conditions or provisions of (i) the charter or bylaws of Purchaser or Flotek, (ii) any statute, law, ordinance, rule, regulation, judgment, decree, order, injunction, writ, permit or
license of any court or Governmental Authority applicable to Purchaser or Flotek or any of its properties or assets, or (iii) any note, bond, mortgage, indenture, deed of trust, license, franchise, permit, concession, contract, lease or other
instrument, obligation or agreement of any kind to which Purchaser or Flotek is now a party or by which Purchaser or Flotek or any of its properties or assets may be bound or affected. 
 (c) Except for any filings or approvals required pursuant to the HSR Act, no declaration, filing or registration with, or notice to, or authorization,
consent or approval of, any Governmental Authority is necessary for the execution and delivery of this Agreement by Purchaser or Flotek or the consummation by Purchaser of the Transaction. 
 Section 2.3 Brokers and Finders. Neither Purchaser nor Flotek has entered into any contract, arrangement or understanding with any
Person or firm which may result in the obligation of Purchaser or Flotek to pay any finder’s fees, brokerage or agent commissions or other like payments in connection with the Transaction. There is no claim for payment by Purchaser or Flotek of
any investment banking fees, finder’s fees, brokerage or agent commissions or other like payments in connection with the negotiations leading to this Agreement or the consummation of the Transaction. 
 Section 2.4 No Financing Contingency. Purchaser and Flotek acknowledge that consummation of the Transaction is not subject to any
financing contingency and that they would, accordingly, be obligated to close the transaction on or prior to the Termination Date notwithstanding any inability to close the Financing if the Purchaser is otherwise obligated to close pursuant the
terms of this Agreement. 
  

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 ARTICLE III 
 REPRESENTATIONS AND WARRANTIES OF TELEDRIFT AND THE STOCKHOLDERS 
 Teledrift and each Stockholder
severally (with each Stockholder’s several liability being based on his Proportionate Ownership) represent and warrant to Purchaser that, except as provided in the Disclosure Schedule: 
 Section 3.1 Organization and Qualification. Teledrift is a corporation duly organized, validly existing and in good standing under the
laws of the State of Oklahoma and has the requisite corporate power and authority to own, lease and operate its assets and properties and to carry on its business as it is now being conducted. Teledrift is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the properties owned, leased, or operated by it or the nature of the business conducted by it makes such qualification necessary, each of which jurisdiction is listed in the
Disclosure Schedule. True, accurate and complete copies of the charter and bylaws of Teledrift, in each case as in effect on the date hereof, including all amendments thereto, have heretofore been delivered to Purchaser. 
 Section 3.2 Stock Ownership. The Stockholders own all of the issued and outstanding equity stock of Teledrift, as more particularly
reflected on Schedule 3.2. 
 Section 3.3 Subsidiaries. Teledrift does not have any Subsidiaries. 
 Section 3.4 Authority; Non Contravention; Approvals. 
 (a) Teledrift and such Stockholder have full power and authority to execute and deliver this Agreement and to consummate the Transaction. This Agreement has been approved by the Board of Directors and stockholders of
Teledrift, and no other corporate proceedings on the part of Teledrift are necessary to authorize the execution and delivery of this Agreement or the consummation by Teledrift of the Transaction. This Agreement has been duly executed and delivered
by Teledrift and such Stockholder, and, assuming the due authorization, execution and delivery hereof by Purchaser, constitutes a valid and legally binding agreement of Teledrift and such Stockholder, enforceable against Teledrift and such
Stockholder in accordance with its terms, except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and
(ii) general equitable principles. 
 (b) Except as set forth in the Disclosure Schedule, the execution and delivery of this Agreement
by Teledrift and such Stockholder and the consummation by Teledrift and such Stockholder of the Transaction do not and will not violate or result in a breach of any provision of, or constitute a default (or an event which, with notice or lapse of
time or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, or result in a right of termination or acceleration under, or result in the creation of any Lien, upon any of the properties
or assets of Teledrift under any of the terms, conditions or provisions of (i) the charter or the Bylaws of Teledrift, (ii) any statute, law, ordinance, rule, regulation, judgment, decree, order, injunction, writ, permit or license of any
court or 

  

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Governmental Authority applicable to Teledrift or its properties or assets, or (iii) any note, bond, mortgage, indenture, deed of trust, license,
franchise, permit, concession, or any Material Contract (as defined in Section 3.20) to which Teledrift is now a party or by which Teledrift or any of its respective properties or assets may be bound or affected. 
 (c) Except for any filings or approvals required pursuant to the HSR Act, no declaration, filing or registration with, or notice to, or authorization,
consent or approval of, any Governmental Authority is necessary for the execution and delivery of this Agreement by Teledrift and such Stockholder or the consummation by Teledrift and such Stockholder of the Transaction. 
 Section 3.5 Financial Statements. Teledrift has furnished Purchaser with unaudited balance sheet, income statement and statement of
cash flow for Teledrift for the fiscal years ending December 31, 2005 and December 31, 2006, and unaudited balance sheet and income statement for the nine months ending September 30, 2007 (collectively, the “Financial
Statements”). The Financial Statements were prepared in accordance with the accounting methods described in the Financial Statements and in the Disclosure Schedule and are accurate and complete in all material respects (except the absence
of footnote disclosures and for the absence of normal year-end audit adjustments which are not material in the aggregate) and fairly present the financial condition and result of operations of Teledrift. Teledrift has also furnished Purchaser with
unaudited balance sheet and income statement for Teledrift for the months of October, November and December 2007 (collectively, the “Interim Financial Statements”). The Interim Financial Statements were prepared on a basis
consistent with the manner in which the Financial Statements were prepared (provided the Interim Financial Statements have not undergone Teledrift’s year end review process or been reviewed by Teledrift’s outside accountants), and, to the
Knowledge of Teledrift, the Interim Financial Statements are accurate and complete in all material respects (except, the absence of footnote disclosures and for the absence of normal year-end audit adjustments which are not material in the
aggregate) and fairly present the financial condition and result of operations of Teledrift. 
 Section 3.6 Absence of Certain
Changes or Events. Since September 30, 2007 and as reflected in Schedule 3.6 of the Disclosure Schedule: 
 (a) there has not
been (i) any Material Adverse Effect, (ii) any damage, destruction, loss or casualty to property or assets of Teledrift, whether or not covered by insurance, which property or assets are material to the operations or business of Teledrift
taken as a whole, (iii) any declaration, setting aside or payment of any dividend or distribution (whether in cash, stock or property) in respect of the capital stock of Teledrift or any redemption or other acquisition by Teledrift of any of
the capital stock of Teledrift or any split, combination or reclassification of shares of capital stock declared or made by Teledrift, (vi) any increase in compensation payable or benefits to directors, executive officers or key employees of
the Teledrift or (v) any commitment or agreement to do any of the actions in subsections (iii) or (iv); and 
 (b) there has not
been with respect to Teledrift (i) any extraordinary losses suffered, (ii) any material assets mortgaged, pledged or made subject to any Lien, other than a Permitted Lien or a Lien which will not continue following the Closing,
(iii) any increase in any 

  

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bad debt, contingency or other reserve, except, in each case, in the ordinary course of business and consistent with past practice, (iv) any Liabilities
paid, discharged or satisfied, other than the payment, discharge or satisfaction, in the ordinary course of business and consistent with past practice, of Liabilities reflected or reserved against in the Base Balance Sheet or incurred in the
ordinary course of business and consistent with past practice since the Base Balance Sheet Date, (v) any write off as uncollectible of any notes or accounts receivable, except write-offs in the ordinary course of business and consistent with
past practice, (vi) any write down of the value of any asset or investment on Teledrift’s books or records, except for depreciation and amortization taken in the ordinary course of business and consistent with past practice, (vii) any
change in any method of accounting or accounting practice, (viii) any cancellation of any debts or waiver of any claims or rights in excess of $25,000 or sale, transfer or other disposition of any properties or assets (real, personal or mixed,
tangible or intangible) in excess of $25,000, other than sales of inventory in the ordinary course of business, (ix) any single capital expenditure or commitment in excess of $50,000 for additions to property or equipment, or aggregate capital
expenditures and commitments in excess of $100,000 (on a consolidated basis) for additions to property or equipment other than the capitalization of rental tools and component parts for rental tools in the ordinary course of business, (x) any
transaction other than in the ordinary course of business, or agreement to do any of the foregoing, or (xi) the taking of any action described in Section 4.1. 
 Section 3.7 Accounts Receivable. The accounts receivable of Teledrift reflected in the Base Balance Sheet and/or which are taken into account in the determination of Net Assets are valid, genuine
and subsisting, arise out of bona fide sales and delivery of goods, performance of services or other business transactions in the ordinary course of business. Any such accounts receivable owed by a specific debtor and its Affiliates which has an
aggregate balance in excess of $50,000 as of the Effective Time, are current and collectible net of any reserves shown on the Financial Statements, and subject to such reserve, will be collected in full, without any set off and without resort to
litigation, within 180 days after the Closing. 
 Section 3.8 Inventory. To the Knowledge of Teledrift, the inventory
reflected in the Base Balance Sheet (the “Inventory”) consists of items that are usable in the ordinary course of business by Teledrift, except for applicable inventory reserves reflected on the Base Balance Sheet and except as set
forth on Schedule 3.8 of the Disclosure Schedules. No items included in the Inventory are held by Teledrift on consignment from others. The Inventory is valued based on a rolling average basis on a basis consistent with that of prior years.

 Section 3.9 Real Property. 
 (a) Teledrift does not own any fee interest in any real property, except the real estate described as now owned by Teledrift in Schedule 1.1(a) of the Disclosure Schedule (the “Owned Real Estate”).
The Owned Real Estate is owned by Teledrift, free and clear of any Lien, except for Permitted Liens. None of the Owned Real Estate is subject to (i) any leases or any right of any third party to use or occupy any portion of the Owned Real
Estate, or (ii) any outstanding options, rights of first offer or rights of first refusal. 
 (b) Teledrift does not lease or occupy any
real estate not owned by it other than the premises described as leased by Teledrift in Schedule 1.1(d) of the Disclosure Schedule (the “Leased Premises”). Teledrift has delivered to Purchaser a true and complete copy of each

  

 9 

 
lease document with respect to the Leased Premises (a “Lease”). Each Lease is valid, binding, and enforceable in accordance with its terms,
and, to the Knowledge of Teledrift, there is no dispute with respect to any such Lease. 
 (c) The Owned Real Estate and the Leased Premises
are sometimes referred to herein collectively as the “Company Facilities.” The improvements included in the Company Facilities are adequate for the operation of the Business as presently conducted. To the Knowledge of Teledrift,
there are no facts or circumstances affecting any of the Company Facilities that would, individually or in the aggregate, interfere in any material respect with the use or occupancy of the Company Facilities as currently operated. The possession and
quiet enjoyment of the Company Facilities by Teledrift has not been disturbed, nor has Teledrift received notice of any condemnation, expropriation, or other proceedings in eminent domain affecting any of the Company Facilities. 
 (d) To the Knowledge of Teledrift, the use by Teledrift of the Company Facilities in the normal conduct of its business does not violate any applicable
building, zoning or other law, ordinance or regulation. 
 (e) Teledrift has not experienced and/or received any notice any material
interruption in the delivery of adequate quantities of any utilities or other public services to the Company Facilities required by Teledrift in the normal operation of its business. 
 Section 3.10 Personal Property. 
 (a) Teledrift owns and has good and marketable title to all of the Acquired Assets which comprise personal property, free and clear of all Liens except Permitted Liens and Liens to be released in connection with the Closing. 
 (b) All Acquired Assets are in such operating condition and repair (reasonable wear and tear excepted) as to allow Teledrift to conduct its Business as
presently conducted. Except for rental tools which are in the possession of customers and tools and/or equipment being assembled and/or repaired or in transit and except as reflected in Schedule 3.10(b) of the Disclosure Schedule, all of the
Acquired Assets, whether owned or leased, are and will be in the possession and control of and owned by Teledrift at the Closing, and no other party has any right or interest in or to the Acquired Assets. 
 (c) The Acquired Assets, comprise all of the assets currently used or held for use by Teledrift to operate the Business, and are collectively sufficient
to provide Purchaser with the means and capability to operate the Business, as and in the manner the Business has been performed by Teledrift prior to the date of this Agreement. 
 Section 3.11 Intellectual Property. 
 (a) Neither Teledrift nor its Business as presently conducted has or will, in any material respect, interfere with, infringe upon, misappropriate, or otherwise come into conflict with, any Intellectual Property rights
of third parties; and Teledrift has not received any charge, complaint, claim, demand, or notice alleging any such interference, infringement, misappropriation, or conflict with any Intellectual Rights of third parties (including any claim 

  

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that Teledrift must license or refrain from using any Intellectual Property rights of any third party). To the Knowledge of Teledrift, no third party has
interfered with, infringed upon, misappropriated, or otherwise come into conflict with, any Intellectual Property rights of Teledrift. 
 (b)
Schedule 3.11 of the Disclosure Schedule identifies each patent or registration that has been issued to Teledrift with respect to any of its Intellectual Property, identifies each pending patent application or application for registration that
Teledrift has made with respect to any of its Intellectual Property, and identifies each material license, agreement, or other permission that Teledrift has granted to any third party with respect to any of its Intellectual Property. Teledrift has
delivered to Purchaser correct and complete copies of all such patents, registrations, applications, licenses, agreements, and permissions (as amended to date). With respect to each item of Intellectual Property identified in Section 3.11 of
the Disclosure Schedule: 
 (i) Teledrift possesses all right, title, and interest in and to the item, free and clear of any Lien other than
Permitted Liens; 
 (ii) Teledrift is not subject to any outstanding injunction, judgment, order, decree, ruling, or charge restricting its
use of such item; 
 (iii) No action, suit, proceeding, hearing, investigation, charge, complaint, claim, or demand is pending or, to the
Knowledge of Teledrift, is threatened that challenges the legality, validity, enforceability, use, or ownership of the item; and 
 (c)
Section 3.11(c) of the Disclosure Schedule identifies each item of Intellectual Property that any third party owns and that Teledrift uses pursuant to license, sublicense, agreement, or permission. Teledrift has delivered to Purchaser correct
and complete copies of all such licenses, sublicenses, agreements, and permissions (as amended to date). With respect to each such item of used Intellectual Property required to be identified in Section 3.11(c) of the Disclosure Schedule:

 (i) The license, sublicense, agreement, or permission covering the item is legal, valid, binding, enforceable, and in full force and
effect in all material respects; 
 (ii) To the Knowledge of Teledrift, no party to the license, sublicense, agreement, or permission is in
breach or default, and no event has occurred that with notice or lapse of time would constitute a breach or default or permit termination, modification, or acceleration thereunder. 
 (iii) To the Knowledge of Teledrift, no party to the license, sublicense, or permission has repudiated any provision thereof; 
 (iv) Teledrift has not granted any sublicense or similar right to any third party with respect to the license, sublicense, agreement, or permission; and

 (v) To the Knowledge of Teledrift, no loss or expiration of the item is threatened, pending, or reasonably foreseeable, except for
patents expiring at the end of their statutory terms (and not as a result of any act or omission by Teledrift, including without limitation, a failure by Teledrift to pay any required maintenance fees). 
  

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 Section 3.12 Labor, Benefit and Employment Agreements. 
 (a) The Disclosure Schedule lists all of the employees of Teledrift and describes any obligation on the part of Teledrift to any of its employees (the
“Employees”) to pay regular salaries or hourly compensation and bonus opportunity during the period of their employment and the manner in which they have been paid. Except as indicated in the Disclosure Schedule, Teledrift is not
utilizing the services of any individual independent contractor on a regular weekly basis. 
 (b) There are no material controversies pending
or, to the Knowledge of Teledrift, threatened between Teledrift on the one hand and any of the Employees on the other. The Disclosure Schedule describes all bonuses and other compensation and any obligation of Teledrift to pay severance or other
payments which will be payable to any of the Employees as a result of, or in connection with, the consummation of the Transaction. 
 (c) The
Disclosure Schedule sets forth each (i) collective bargaining agreement or other written agreement covering unionized employees with respect to which Teledrift has any Liability, (ii) bonus, deferred compensation, stock option, stock
purchase, retirement, severance, welfare, incentive, pension, profit sharing, retirement, change in control, or retention plan, policy, arrangement or agreement, including any plan constituting an “employee benefit plan” within the meaning
of the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended, maintained by Teledrift or any organization which, together with Teledrift, would be treated as a “single employer” within the meaning of
Section 414(b) or (c) of the Code, or to which Teledrift or any such organization contributes (or has any obligation to contribute) or is a party or with respect to which Teledrift has any Liability (collectively, the “Employee
Plans”), and (iii) written employment or other compensation policies, arrangements and agreements with respect any non hourly and/or non union employee(s) of Teledrift (collectively, the “Employment Agreements”).

 (d) No union is now certified or has claimed in writing the right to be certified as a collective bargaining agent to represent any
employees of Teledrift, and there are no organizational activities or labor disputes existing or, to the Knowledge of Teledrift, threatened, involving organizational activities, picketing, strikes, slowdowns, work stoppages, job actions or lockouts
of any employees of Teledrift. 
 (e) Teledrift has not received written notice of any unfair labor practice charges or petitions for
election filed, pending or being litigated before the National Labor Relations Board or any State labor relations board involving Teledrift. Teledrift has not received any written notice of any actual or alleged violation of any law, regulation,
order or contract term affecting the collective bargaining rights of employees, equal opportunity in employment, or employee health, safety, welfare, or wages and hours involving Teledrift. 
  

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 (f) No Employee Plan is an “employee pension benefit plan” (within the meaning of
Section 3(2) of ERISA) subject to Section 412 of the Code or Section 302 or Title IV of ERISA. 
 (g) Each Employee Plan has
been administered and operated in compliance with all applicable statutes, rules and regulations, except as could not reasonably be expected to result in a material Liability to Teledrift; 
 (h) No Employee Plan provides for post-employment or retiree welfare benefits, except as required under Section 4980B of the Code; 
 (i) Teledrift has not filed an application under the IRS Employee Plans Compliance Resolution System or the Department of Labor’s Voluntary
Fiduciary Correction Program with respect to any Employee Plan; 
 (j) No claim, action or litigation, has been made, commenced or, to the
Knowledge of Teledrift, threatened with respect to any Employee Plan (other than routine claims for benefits payable in the ordinary course, and appeals of denied claims), which could reasonably be expected to result in material Liability to
Teledrift; 
 (k) No Employee Plan has assets that include securities issued by Teledrift; 
 (l) Neither Teledrift, nor, to the Knowledge of Teledrift, any other “disqualified Person” or “party in interest” (as defined in
Section 4975(e)(2) of the Code and Section 3(14) of ERISA, respectively) has engaged in any transactions in connection with any Employee Plan that could reasonably be expected to result in the imposition of a penalty pursuant to
Section 502 of ERISA, damages pursuant to Section 409 of ERISA or a tax pursuant to Section 4975 of the Code; 
 (m) To the
Knowledge of Teledrift, the execution of this Agreement and the consummation of the transactions contemplated hereby, do not constitute a triggering event under any Employee Plan, Employment Agreement, policy, arrangement, statement, commitment or
agreement, whether or not legally enforceable, which (either alone or upon the occurrence of any additional or subsequent event) will or may result in any payment (whether of severance pay or otherwise), “parachute payment” (as such term
is defined in Section 280G of the Code), acceleration, vesting or increase in benefits to any employee or former employee or director of Teledrift. 
 (n) Teledrift has delivered or caused to be delivered to the Purchaser or its counsel true and complete copies of each Employee Plan, together with all amendments thereto, and, to the extent applicable, (i) all
current summary plan descriptions; (ii) the annual report on Internal Revenue Service Form 5500-series, including any attachments thereto, for each of the last three (3) plan years; (iii) the most recent determination letter related
to any of the Employee Plans intended to qualify under Section 401(a) of the Code; and (iv) any materials relating to any government investigation or audit or any submissions under any voluntary compliance procedures. 
  

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 Section 3.13 Litigation. Except as reflected on Schedule 3.13 of the Disclosure
Schedule, there are no claims, suits, actions, or proceedings pending or, to the Knowledge of Teledrift, threatened against or relating to Teledrift, before any court, Governmental Authority, or any arbitrator. Teledrift is not subject to any
judgment, decree, injunction, rule or order of any court or Governmental Authority. 
 Section 3.14 No Violation of Law.
Teledrift is not in violation, in any material respect, of or has not been given written notice or been charged with any violation of, any law, statute, order, rule, regulation, ordinance or judgment (including, without limitation, any applicable
Environmental Law, as hereinafter defined) of any Governmental Authority, and specifically, but not by way of limitation, the Foreign Corrupt Practices Act. Except as disclosed in the Disclosure Schedule, as of the date of this Agreement, to the
Knowledge of Teledrift, no investigation or review by any Governmental Authority with respect to Teledrift is pending or threatened, nor has any Governmental Authority indicated an intention to conduct the same. Teledrift has all permits (including
without limitation Environmental Permits (as defined in Section 3.19)), licenses, franchises, variances, exemptions, orders and other governmental authorizations, necessary to conduct its Business as presently conducted (collectively, the
“Company Permits”). Teledrift is not in violation, in any material respect, of the terms of any Company Permits. 
 Section 3.15 Insurance Policies. The Disclosure Schedule sets forth a true and accurate list and summary of current insurance coverage or information concerning any self insurance program with respect to Teledrift.
Teledrift has not received written notice from any current insurance carrier of the intention of such carrier (a) to discontinue any material insurance coverage afforded to Teledrift; or (b) to materially increase the premium costs of such
insurance. 
 Section 3.16 Suppliers. Except as set forth in the Disclosure Schedule, no single supplier accounted for
more than 5% of the raw materials, services or merchandise purchased by Teledrift, on an aggregate basis, during the year ended December 31, 2006, or during the nine months ended on the Base Balance Sheet Date. Since December 31, 2006
there has not been (a) any adverse change in the business relationship of Teledrift with any such supplier which would have a material and adverse impact on the Business, or (b) any material change in any term (including credit terms) of
the agreements with any such supplier made outside the ordinary course of business. To the Knowledge of Teledrift, there are no existing, announced or anticipated changes in the policies of any supplier which will materially affect the amount of
business Teledrift conducts with such supplier after the date of this Agreement. 
 Section 3.17 Customers and
Distributors. Except as set forth in the Disclosure Schedule, no single customer (with respect to direct sales by Teledrift) or distributor accounted for more than 5% of the sales of Teledrift during the year ended December 31, 2006, or
during the nine months ended on the Base Balance Sheet Date. The Disclosure Schedule sets forth the amount of sales of Teledrift which were to customers located outside of the United States of America during such periods, itemized by country. Except
as set forth in the Disclosure Schedule, since December 31, 2006 there has not been (a) any adverse change in the business relationship of Teledrift with any customer or distributor identified in the Disclosure Schedule which would have a
material and adverse impact on the Business; or (b) any material change in any term (including credit terms) of the agreements with any such customer or distributor which 

  

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would have a material and adverse impact on the Business. To the Knowledge of Teledrift, there are no existing, announced or anticipated changes in the
policies of any customers or distributors which will materially affect the amount of business Teledrift conducts with such customers or distributors after the date of this Agreement. 
 Section 3.18 Taxes. 
 (a)
All returns and reports, including, without limitation, information and withholding returns and reports (“Tax Returns”), of or relating to any Tax that are required to be filed on or before the Closing by or with respect to
Teledrift have been or will be duly and timely filed. All such tax returns were correct and complete in all respects and all Taxes, including interest and penalties, owed by Teledrift with respect to such periods have been paid. There is no unpaid
pending claim against Teledrift with respect to any Taxes, and no assessment, deficiency or adjustment has been asserted or proposed with respect to any Tax Return of or with respect to Teledrift. There are no pending Tax audits with respect to
Teledrift. All Taxes which Teledrift is required by law to withhold or collect in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other third party have been duly withheld or collected, and
have been timely paid over to the proper authorities to the extent due and payable. No waiver or extension of any statute of limitation as to any federal, local or foreign Tax matter has been given by Teledrift. Teledrift has not filed consolidated
income tax returns with any other entity for any taxable period. There are no tax sharing, tax allocation, tax indemnification, or similar agreements in effect between Teledrift and any other party. 
 (b) Teledrift has been a validly electing S corporation within the meaning of Code Sections 1361 and 1362 at all times during its existence. Teledrift
will be an S corporation up to and including the Closing Date. 
 Section 3.19 Environmental Matters. Except as set forth
in the Disclosure Schedule: 
 (a) No written notice, demand, request for information, citation, summons or order has been received, and no
complaint has been served, and no penalty has been assessed by any Governmental Authority relating to or arising out of non-compliance by Teledrift with any Environmental Laws (as defined below) which is still pending; 
 (b) No investigation, action, claim, suit, proceeding or review is pending or, to the Knowledge of Teledrift, is threatened by any Governmental Authority
relating to or arising out of any violation by Teledrift of any Environmental Law; 
 (c) Teledrift is in compliance, in all material
respects, with all Environmental Laws and Environmental Permits (as defined below); and 
 (d) To the Knowledge of Teledrift, there are no
facts, conditions, situations or set of circumstances which could reasonably be expected to result in or be the basis for Liability under applicable Environmental Laws. 
 For purposes of this Agreement, (i) “Environmental Laws” means any and all laws, statutes, ordinances, rules, regulations, orders or determinations of any Governmental Authority relating to the
protection of the environment or protection of human health from exposure to 

  

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hazardous materials that is currently in effect in any and all jurisdictions in which Teledrift owns property or conducts business, including without
limitation, the Clean Air Act, as amended, the Comprehensive Environmental, Response, Compensation, and Liability Act of 1980, as amended, the Federal Water Pollution Control Act, as amended, the Occupational Safety and Health Act of 1970, as
amended, the Resource Conservation and Recovery Act of 1976, as amended, the Safe Drinking Water Act, as amended, the Toxic Substances Control Act, as amended, the Superfund Amendments and Reauthorization Act of 1986, as amended, the Hazardous
Materials Transportation Act, as amended, and all other environmental conservation or protection laws, and (ii) “Environmental Permits” means all permits, licenses, certificates, registrations, identification numbers,
applications, consents, approvals, variances, notices of intent, and exemptions necessary for the ownership, use and/or operation of any facility or operation of Teledrift to comply with requirements of Environmental Laws. 
 Section 3.20 Material Contracts and Relationships. The Disclosure Schedule sets forth a correct and complete list of the following
(hereinafter referred to as the “Material Contracts”): 
 (a) all loans, credit commitments, bonds, debentures, notes,
mortgages, indentures or guarantees of borrowed indebtedness to which Teledrift is a party or by which it or its properties or assets (real, personal or mixed, tangible or intangible) are bound; 
 (b) all existing Contracts (other than those described in subparagraph (a) or (c), and any Employee Plan) to which Teledrift is a party or by which
it or its properties or assets may be bound involving an annual commitment or annual payment by any party thereto of more than $100,000 individually, or which have a term extending more than twelve months from the date hereof and which involve a
cumulative commitment or payment by any party thereto of more than $100,000; 
 (c) all agreements imposing a noncompetition obligation on
Teledrift or any of its Affiliates or any similar restriction on the activities of Teledrift or its Affiliates; 
 (d) any agreement
concerning a partnership or joint venture; 
 (e) any agreement relating to the distribution or marketing of any of the products of Teledrift
by a third party; and 
 (f) all Assigned Leases. 
 Correct and complete copies of all Material Contracts, including all amendments thereto, have been made available to the Purchaser. The Material Contracts are valid and enforceable in accordance with their respective
terms with respect to Teledrift and are valid and enforceable in accordance with the respective terms to any other party thereto. There is not under any of the Material Contracts any existing breach, default or event of default by Teledrift, nor, to
the Knowledge of Teledrift, is there any breach or default by any other party thereto. 
 Section 3.21 Brokers and
Finders. Except as reflected in Schedule 3.21 of the Disclosure Schedule, none of the Stockholders or Teledrift have entered into any contract, arrangement or understanding with any Person or firm which may result in the obligation of the

  

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Stockholders or Teledrift to pay any finder’s fees, brokerage or agent commissions or other like payments in connection with the Transaction
contemplated hereby. Except as reflect in Schedule 3.21 of the Disclosure Schedule, there is no claim for payment by Teledrift of any investment banking fees, finder’s fees, brokerage or agent commissions or other like payments in
connection with the negotiations leading to this Agreement or the consummation of the Transaction (whether or not reflected in the Disclosure Schedule, a “Teledrift Fee Obligation”). 
 Section 3.22 Transactions with Affiliates. Except as set forth in the Disclosure Schedule, no Stockholder, or any officer or director
of Teledrift, or any Person with whom any such Stockholder, officer or director has any direct or indirect relation by blood, marriage or adoption, or any entity in which any Person owns any beneficial interest (other than a publicly-held
corporation whose stock is traded on a national securities exchange or in the over-the-counter market and less than 1% of the stock of which is beneficially owned by all of such Persons), currently has, or with the past three (3) years has had,
any interest in (a) any Contract, arrangement or understanding with, or relating to, the business or operations of Teledrift, (b) any loan, arrangement, understanding, agreement or contract for or relating to indebtedness with Teledrift,
(c) any property (real, personal, or mixed), tangible or intangible, used or currently intended to be used in, the business or operations of Teledrift or (d) any business or entity that competes with Teledrift. 
 Section 3.23 Liabilities. Neither Teledrift nor the Acquired Assets are subject to any Liabilities which exist as of the date hereof
and are of a nature which would be required to be included on a balance sheet of Teledrift as of Closing in accordance with GAAP if all relevant facts relating to such Liability were known at the time of Closing which will become Liabilities of
Purchaser or Flotek as a result of the consummation of the Transaction, other than the Assumed Liabilities and Liabilities disclosed in Schedule 3.23 of the Disclosure Schedule. 
 ARTICLE IV 
 CONDUCT OF BUSINESS PENDING THE CLOSING 
 From the date hereof until the Closing, the parties to this Agreement shall observe and perform the covenants of this Article IV. 
 Section 4.1 Conduct of Business of Teledrift. Prior to the Effective Time, Teledrift shall operate its businesses in, and only in, the
usual, regular and ordinary course of business. Without limiting the generality of the foregoing, during the period from the date of this Agreement to the Closing Date, Teledrift will not: 
 (a) Amend its organizational documents in any manner which adversely impacts the Purchaser; 
 (b) Merge or consolidate with or agree to merge or consolidate with, or purchase or agree to purchase all or substantially all of the assets of, or
otherwise acquire any corporation, partnership, association or other business organization or division thereof; 
 (c) Sell, lease or
otherwise dispose of, or agree to sell, lease or otherwise dispose of, any of its assets other than in the ordinary course of business consistent with past practice; 
  

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 (d) Issue any capital stock or equity interests or any rights to acquire any of its capital stock or
equity interests; 
 (e) Enter into any contract relating to the distribution or marketing of products by a third party on behalf of
Teledrift, or by Teledrift on behalf of any third parties (unless Teledrift obtains the written consent of Purchaser, which consent shall not be unreasonably withheld); 
 (f) Adopt, amend or terminate any Employee Plan; 
 (g) Amend or terminate any Material Contract except in
the ordinary course of business; 
 (h) Enter into any transaction or agreement with any of the Stockholders or any Person with whom any
Stockholder has any direct or indirect relation by blood, marriage or adoption, or any Affiliate of a Stockholder or any such Person or Persons; 
 (i) Enter into, modify or extend in any manner the terms of any employment, severance or similar agreements with officers and directors nor grant any increase in the compensation of officers, directors or employees, whether now or hereafter
payable (except for transaction bonuses payable by Teledrift with respect to the transactions contemplated by this Agreement provided for in the Disclosure Schedule and compensation increases and payment of bonuses in the ordinary course of business
and consistent with past practice with respect to employees other than executive officers and directors); 
 (j) Make any capital
expenditures which have an aggregate cost of $50,000 or more other than capital expenditures for rental tools and component parts for rental tools incurred in the ordinary course of business; 
 (k) (i) Create, incur or assume any long-term debt (including obligations in respect of capital leases which individually involve annual payments in
excess of $25,000 or $50,000 in the aggregate) or, except in the ordinary course of business under existing lines of credit, create, incur or assume any short-term debt for borrowed money, (ii) assume, guarantee, endorse or otherwise become
liable or responsible (whether directly, contingently or otherwise) for obligations of any other Person, (iii) create, or allow the creation of, any Lien applicable to any of Teledrift’s assets other than Permitted Liens, (iv) make
any loans or advances to any other Person, or (v) make any capital contributions to, or investments in, any Person; 
 (l) Change any
accounting method or practices of Teledrift, except as required by applicable law or GAAP; 
 (m) Waive any rights under any Material
Contract other than in the ordinary course of business; 
 (n) Enter into, assume or amend any contract or commitment that would be a
Material Contract other than in the ordinary course of business; and/or 
  

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 (o) Revoke Teledrift’s election to be taxed as an S corporation within the meaning of Code
Section 1361 and Section 1362; or take or allow any action that would result in the termination of Teledrift’s status as a validly electing S corporation within the meaning of Code Section 1361 and Code Section 1362;

 (p) Make or declare a dividend, payment or other distribution to any of its stockholders or owners which consists of any assets other than
cash or Retained Assets, or redeem any stock or equity interests; 
 (q) Alter in any material respect the practices of the Business relating
to the payment of accounts payable or the collection of accounts receivable. 
 Section 4.2 Business Organization. Prior
to the Effective Time, Teledrift and the Stockholders shall use their Reasonable Efforts to: 
 (a) preserve intact the business organization
of Teledrift; 
 (b) keep available the services of the officers and employees of Teledrift; 
 (c) preserve the goodwill of Teledrift; 
 (d) maintain and keep the properties and assets of Teledrift in as good a repair and condition as presently exists; 
 (e) maintain
in full force and effect the current insurance coverage of Teledrift; and 
 (f) carry on business of Teledrift in the ordinary and regular
course, consistent with past practice and in substantially the same manner as heretofore conducted; and 
 (g) perform in all material
respects all of its obligations under all Material Contracts (except those being contested in good faith). 
 Section 4.3
Acquisition Transactions. After the date hereof and prior to the Effective Time or earlier termination of this Agreement, neither Teledrift nor any of the Stockholders will initiate, solicit, negotiate, encourage or provide
confidential information to facilitate, and Teledrift and each of the Stockholders shall not, and shall cause any officer, director or employee of Teledrift, or any attorney, accountant, investment banker, financial advisor or other agent retained
by any of them not to, initiate, solicit, negotiate, encourage or provide non public or confidential information to facilitate, or conduct any negotiations or discussions relating to any proposal or offer to acquire all or any substantial part of
the stock, business or properties of Teledrift, whether by merger, purchase of assets, tender offer or otherwise, whether for cash, securities or any other consideration or combination thereof. 
 Section 4.4 Inspection and Access to Information. 
 (a) Teledrift and the Stockholders shall afford to Purchaser and its accountants, counsel, financial advisors and other representatives, reasonable access during 

  

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normal business hours throughout the period prior to the Closing to all of the properties, books, Contracts, personnel, and records (including, but not
limited to, Tax Returns and any and all records or documents which are within the possession of Governmental Authorities, agencies or bodies, and the disclosure of which Teledrift can facilitate or control) of Teledrift as Purchaser or its
representatives may reasonably request. Any investigation pursuant to this Section shall be conducted in such manner as not to interfere unreasonably with the conduct of the business of Teledrift or with the performance of any of the employees of
Teledrift. No investigation pursuant to this Section shall affect any representation or warranty made by any party. 
 (b) Purchaser shall
afford to Teledrift and the Stockholders and their accountants, counsel, financial advisors and other representatives, reasonable access during normal business hours for a period of six years following the Closing to personnel and all books and
records relating to the Pre-Closing operations of Teledrift as Teledrift or the Stockholders may reasonably require. Any access to and review of such books and records shall be conducted in such manner as not to interfere unnecessarily with the
conduct of business of Purchaser or with the performance of any of the employees of Purchaser. 
 Section 4.5 Assignment of
Contracts and Agreements. (a) Teledrift shall, subject to obtaining required consents and approvals, assign to Purchaser all of Teledrift’s rights under the Assigned Contracts and the Assigned Leases. Teledrift and Purchaser shall
use Reasonable Efforts to obtain at the earliest practicable date and prior to the Closing all consents of third parties related to the consummation of the Transaction. To the extent that the assignment of any of such Contracts requires the consent
of another party that is not obtained at the Closing, Purchaser may waive its right at the Closing to receive such consent in its sole discretion, (and Purchaser herein waives any obligation of Teledrift or the Stockholder to obtain consents to
assignment of the Contracts listed on Schedule 4.5(a)) such Contracts will not be transferred or assigned at Closing and shall constitute “Deferred Contracts,” (b) Teledrift will continue to undertake Reasonable Efforts to
obtain any such consent and/or remove any other impediments to the transfer or assignment of such Deferred Contracts at the earliest practicable date and shall transfer or assign such Deferred Contract within three (3) business days after
receipt of such consent, (c) until the time of assignment of a Deferred Contract, Teledrift shall cooperate with Purchaser to provide Purchaser all benefits under any such Contract and to allow Purchaser to perform its obligations under the
Assumed Liabilities, to the same extent as if the Deferred Contract were transferred or assigned to Purchaser at the Closing and (d) until the time of assignment or termination of a Deferred Contract, Teledrift shall, at the request and for the
account of Purchaser, and subject to Purchaser’s direction, enforce, at Purchaser’s expense, Teledrift’s rights thereto or interests therein against other parties. 
 Section 4.6 Transfer Taxes. Purchaser shall be responsible for the payment of all transfer, sales, use, stamp, registration or other
similar transfer Taxes, if any, resulting from the transfer and conveyance of the Acquired Assets as contemplated by this Agreement. 
 Section 4.7 Cooperation with Respect to Financing. Teledrift and the Stockholders shall provide such assistance and cooperation as Purchaser may reasonably request in connection with Flotek and Purchaser obtaining the
debt financing required to finance the payment of the Purchase Price (“Financing”), including (a) making senior management of Teledrift reasonably available for presentations and calls, lender or proposed financing source
meetings, (b)

  

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cooperating with underwriters and prospective lenders and their respective advisors in performing their due diligence, (c) providing copies of all
customary historical financial statements and financial and other information (which has heretofore been prepared by Teledrift) for use by Purchaser and Flotek with respect to the Financing, and (d) using Reasonable Efforts to facilitate the
cooperation of the accountants of Teledrift. 
 Section 4.8 Cooperation with Respect to Argentina Operations. Teledrift
and Max Weldon shall each use their respective Reasonable Efforts to (i) cause Teledrift Argentina S. A., to confirm prior to Closing that Teledrift possesses good title to the items of equipment located in Argentina which are indicated in the
Financial Statements as being owned by Teledrift, and (ii) provide prior to Closing such documentation as shall be required to establish that Max Weldon does not have any ownership interest in Teledrift Argentina S. A. 
 ARTICLE V 
 ADDITIONAL AGREEMENTS

 Section 5.1 Employment Agreements. At the Closing, Purchaser and Max Weldon, and Purchaser and Manoj Gopalan, shall
enter into employment agreements in the form attached hereto as Exhibits 5.1(a) and 5.1(b) respectively. 
 Section 5.2 Expenses
and Fees. Subject to the following sentence, all costs and expenses incurred in connection with this Agreement and the Transaction shall be paid by the party incurring such expenses. All legal, accounting and investment banking fees and
charges, and other costs and expenses relating to the Transaction, incurred by Teledrift shall be paid by Teledrift and the Purchaser shall bear no Liability for such amounts, regardless of when incurred. 
 Section 5.3 Agreement to Cooperate. 
 (a) Subject to the terms and conditions herein provided, each of the parties hereto shall use all Reasonable Efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and make effective the Transaction, including using its Reasonable Efforts to obtain all necessary, proper or advisable waivers, consents and approvals under applicable laws and
regulations to consummate and make effective the Transaction, including using its Reasonable Efforts to obtain all necessary or appropriate waivers, consents or approvals of third parties required in order to preserve material contractual
relationships of Teledrift and to lift any injunction or other legal bar to the Transaction (and, in such case, to proceed with the Transaction as expeditiously as possible). 
 (b) In the event any claim, action, suit, investigation or other proceeding by any Governmental Authority or other legal or administrative proceeding is
commenced that questions the validity or legality of the Transaction contemplated hereby or seeks damages in connection therewith, whether before or after the Closing, the parties hereto agree to cooperate and use their Reasonable Efforts to defend
against and respond thereto; provided, however, that in the event any claim, action, suit, investigation or other proceeding is commenced against Teledrift or the Stockholders by any Governmental Authority or other legal or administrative proceeding
is commenced against Teledrift or the Stockholders pursuant to federal or state 

  

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antitrust laws, Purchaser shall have the right, at its own expense, to participate therein, and Teledrift will not settle any such litigation without the
consent of Purchaser, which consent will not be unreasonably withheld. 
 Section 5.4 Public Statements. Neither party
shall issue any press release or any written public statement with respect to this Agreement or the Transaction without first consulting with the other party and the prior written approval of the other party, which approval will not be unreasonably
withheld. 
 Section 5.5 Prohibited Activities. Each Stockholder agrees that for a period of two years following the date
hereof, he will keep confidential and not disclose any non-public information in his possession relating to Teledrift. In furtherance of the intent of the foregoing covenants and as additional consideration for the performance by the Purchaser
pursuant to the terms hereof, each Stockholder (other than Weldon and Gopalan as it relates to their employment with Flotek or its Affiliates) agrees, severally and not jointly with any other Person, that he will not, during the period beginning on
the date hereof and ending on the second anniversary of the Closing Date, directly or indirectly, for any reason, for his own account or on behalf of or together with any other Person: 
 (a) engage as an officer, director or in any other managerial capacity or as an owner, co-owner or other investor of or in, whether as an employee,
independent contractor, consultant or advisor, or as a sales representative, dealer or distributor of any kind, in the business of the manufacture, sale, distribution, rental or marketing of measurement while drilling equipment within the United
States of America or in any other jurisdiction in which Teledrift engaged in business during 2007 (the “Territory”); 
 (b)
hire or engage any natural Person who at the time of Closing is employed by Teledrift in any capacity, or call on otherwise solicit any Person who is employed by Purchaser with the purpose or intent of attracting that Person from the employ of
Purchaser, provided that publication of a general solicitation or hiring of a Person as a result of such general solicitation which was not directed at a particular employee shall not be prohibited by this Section 5.5(b); or 
 (c) call on, solicit or perform services for, either directly or indirectly, any Person that at that time is, or at any time within two years prior to
that time was, a customer of Teledrift within any Territory for the purpose of soliciting or selling any product or service in competition with Teledrift within the Territory. 
 (d) Notwithstanding the foregoing, nothing in this Section 5.5 shall prohibit any of the Stockholders from being a passive investor in less than 5%
of the outstanding securities of any entity subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act. 
 Section 5.6 Employees, Consultants and Employee Benefits. 
 (a) On the Closing Date, the Purchaser shall offer
employment, as of the Effective Time, on an at will basis, to each employee employed by Teledrift as of the Closing Date, initially at the employee’s existing employment location and at wages and salaries that are 

  

 22 

 
substantially equivalent to the wages and salaries currently being paid by Teledrift to such employee. The Purchaser will have no obligation to continue the
employment of any employee following the Closing, it being understood that, subject to applicable law, such employment may be terminated at any time, for any reason or for no reason. Teledrift shall be responsible for the payment of all regular and
overtime compensation to its employees; medical plan withholding; federal and state withholding; workers’ compensation insurance premium payments and claims; medical plan claims; accrued vacation, sick time or paid time off; health, disability,
benefit and retirement plan contributions and claims related to fiduciary management of such plans (including 401(k), Keough and pension plans); unemployment compensation Liabilities, unemployment tax payments and withholding; any and all employment
related claims arising from acts or omissions of Teledrift occurring prior to the Effective Time (including claims under the workers’ compensation laws, ERISA, and any equal opportunity or human rights acts and any other state, federal or
common law claim); and any fines or administrative expenses assessed thereunder for acts or omissions of Teledrift occurring prior to the Effective Time. 
 (b) Following the Closing Date, Teledrift shall, in accordance with its obligations under the Comprehensive Omnibus Budget Reconciliation Act (“COBRA”), notify each of its employees of the continued
availability of health insurance benefits to such employee through the Seller’s group health plans (subject to the employee’s payment of applicable premiums thereunder), and will permit all electing employees to maintain continued coverage
thereunder as and to the extent and subject to the conditions provided in COBRA. 
 Section 5.7 Assignment of Accounts
Receivable. In the event that Purchaser makes a claim against Sellers for a breach of Section 3.7 due to an account receivable not being collected, then Purchaser agrees to cause the account receivable in question to be assigned to
Sellers and Sellers will have the right to attempt to collect such receivable for the account of the Sellers. 
 Section 5.8
Change of Name. Teledrift shall as promptly as practicable after Closing change its name to a name which does not incorporate the word “Teledrift.” 
 ARTICLE VI 
 CONDITIONS TO CLOSING 
 Section 6.1 Conditions to Each Party’s Obligation to Effect the Transaction. The respective obligations of each party hereto to
effect the Transaction shall be subject to the fulfillment or waiver, if permissible, at or prior to the Closing Date of the following conditions: 
 (a) no preliminary or permanent injunction or other order or decree by any federal or state court which prevents the consummation of the Transaction shall have been issued and remain in effect (each party agreeing to use its Reasonable
Efforts to have any such injunction, order or decree lifted); 
 (b) the waiting period under the HSR Act shall have expired or other
approvals under the HSR Act shall have been obtained with respect to the Transaction; and 
  

 23 

 (c) no action shall have been taken, and no statute, rule or regulation shall have been enacted, by any
Governmental Authority which would prevent the consummation of the Transaction or make the consummation of the Transaction illegal. 
 Section 6.2 Conditions to Obligation of Teledrift to Effect the Transaction. Unless waived by Teledrift, the obligations of Teledrift to effect the Transaction shall be subject to the fulfillment at or prior to the
Closing Date of the following additional condition: 
 (a) Purchaser shall have performed in all material respects (or in all respects in the
case of any agreement containing any materiality qualification) the agreements contained in this Agreement required to be performed by it on or prior to the Closing Date and the representations and warranties of Purchaser contained in this Agreement
shall be true and correct in all material respects (or in all respects in the case of any representation or warranty containing any materiality qualification) on and as of the date made and on and as of the Closing Date as if made at and as of such
date, and Teledrift shall have received a certificate executed on behalf of Purchaser by the President or a Vice President of Purchaser to that effect. 
 (b) All material third party consents, if any, required for the consummation of the Transaction shall have been obtained. 
 (c) There shall not be in force any law restraining or prohibiting the consummation of the Transaction. 
 Section 6.3 Conditions to Obligations of Purchaser to Effect the Transaction. Unless waived by Purchaser, the obligations of Purchaser to effect the Transaction shall be subject to the fulfillment at or prior to the
Closing Date of the following additional conditions: 
 (a) Teledrift and the Stockholders shall have performed in all material respects (or
in all respects in the case of any agreement containing any materiality qualification) their respective agreements contained in this Agreement required to be performed on or prior to the Closing Date and the representations and warranties of
Teledrift and the Stockholders contained in this Agreement shall be true and correct in all material respects (or in all respects in the case of any representation or warranty containing any materiality qualification) on and as of the date made and
on and as of the Closing Date as if made at and as of such date, and shall have received a certificate executed by the Stockholders to that effect; 
 (b) Since September 30, 2007, there shall have been no changes that constitute, and no event or events shall have occurred which have resulted in or constitute, a Material Adverse Effect with respect to of the Company; 
 (c) All material third party consents, if any, set forth in Schedule 6.3(c) which are required for the consummation of the Transaction shall have been
obtained; and 
 (d) There shall not be in force any law restraining or prohibiting the consummation of the Transaction. 
  

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 ARTICLE VII 
 SURVIVAL; INDEMNIFICATION 
 Section 7.1 Survival. All representations and
warranties and pre-closing covenants of the Parties contained in this Agreement shall survive the Closing until eighteen months after the Closing Date, except that (i) the representations and warranties contained in Sections 2.2(a), 2.5,
3.4(a), 3.9(a), 3.10(a), and Section 3.18 shall survive for the applicable statute of limitations period within which a third party is permitted to assert a claim relating thereto plus sixty (60) days. No Party shall have any liability for
indemnification claims made under this Article VII with respect to any such representation or warranty or pre-closing covenant unless an indemnification claim notice is provided by the non-breaching Party to the other Party prior to the expiration
of the applicable survival period for such representation, warranty or covenant, if any. If a claim notice has been timely given in accordance with this Agreement prior to the expiration of the applicable survival period for such representation or
warranty or pre-closing covenant, if any, then the applicable representation or warranty shall survive as to such claim, until such claim has been finally resolved. The limitations provided for in this Section shall not affect or limit any claim for
actual fraud. 
 Section 7.2 Indemnification by Teledrift and the Stockholders. Subject to the limitations set forth in
Sections 7.5, 7.6, 7.7 and 7.8 below, Teledrift and each Stockholder shall severally (with each Stockholder’s respective several liability being in the ratio of his Proportionate Ownership) indemnify, protect, and defend Purchaser, and its
Affiliates (including their respective officers, directors, employees and agents) against, and hold each of them harmless from and against, any and all claims, actions, causes of action, arbitrations, proceedings, Liabilities, judgments and expenses
(including, without limitation, reasonable attorneys’ fees) (“Indemnified Amounts”) suffered, paid, or incurred by the indemnified party as a result of (a) any inaccuracy or breach of any of the representations and
warranties made by or on behalf of Teledrift or such Stockholder in Article III of this Agreement (in each case without regard to any qualification as to materiality or Material Adverse Effect), (b) any violation or breach by
Teledrift or such Stockholder of or default by Teledrift or such Stockholder under the terms of this Agreement, or (c) any Teledrift Fee Obligation. 
 Section 7.3 Indemnification by Purchaser and Flotek. Subject to the limitations set forth in Sections 7.5, 7.7 and 7.8 below, Purchaser and Flotek will indemnify, protect and defend Teledrift and
each Stockholder against, and hold them harmless from and against, any and all Indemnified Amounts suffered, paid, or incurred by Teledrift or such Stockholder as a result of (a) any inaccuracy or breach of the representations and warranties
made by or on behalf of Purchaser in Article II of this Agreement (in each case without regard to any qualification as to materiality or Material Adverse Effect), (b) any violation or breach by Purchaser or Flotek of or default by Purchaser or
Flotek under the terms of this Agreement, or (c) any Assumed Liability. 
 Section 7.4 Procedure. The defense of any
claim, action, suit, proceeding or investigation brought by a third party which is subject to indemnification under this Article VII shall be conducted by the indemnifying party. If the indemnifying party fails to conduct such defense, the
indemnified parties may retain counsel satisfactory to them and the indemnifying party shall (if such claim is determined to be a matter for which indemnification was required) reimburse all reasonable fees and expenses of such counsel for the
indemnified parties. The 

  

 25 

 
party not conducting the defense will use Reasonable Efforts to assist in the vigorous defense of any such matter, provided that such party shall not be
liable for any settlement of any claim effected without its written consent, which consent, however, shall not be unreasonably withheld. Any indemnified party wishing to claim indemnification under this Article VII, upon learning of any such claim,
action, suit, proceeding or investigation, shall notify the indemnifying party in writing (but the failure so to notify a party shall not relieve such party from any Liability which it may have under this Article VII except to the extent such
failure materially prejudices such party). If the indemnifying party is responsible for the attorneys’ fees of the indemnified parties, then the indemnified parties as a group may retain only one law firm to represent them with respect to each
such matter unless there is, under applicable standards of professional conduct, a conflict on any significant issue between the positions of any two or more indemnified parties. 
 Section 7.5 Express Negligence; Indemnification. The indemnification obligations under this Article VII shall apply regardless of
whether any suit or action results solely or in part from the active, passive or concurrent negligence of the indemnified party. The rights of the parties to indemnification under this Article VII shall not be limited due to any investigations
heretofore or hereafter made by such parties or their representatives, regardless of negligence in the conduct of any such investigations. The representations, warranties and covenants and agreements made by the parties shall not be deemed merged
into any instruments or agreements delivered in connection with the Closing or otherwise in connection with the Transaction contemplated hereby. 
 Section 7.6 Limitations on Liability. 
 (a) Teledrift and the Stockholders will have no liability under
Section 7.2(a) or under Section 7.2(b) to the extent Section 7.2(b) relates to pre-closing covenants until the aggregate amount of all Indemnified Amounts with respect to such matters exceeds $1,000,000 (the
“Deductible”), in which case Teledrift and the Stockholders shall be liable only for Indemnified Amounts in excess of the Deductible. Any breach of any representation or warranty of Teledrift or the Stockholders in this Agreement in
connection with any single event or group of related events that results in Indemnified Amounts of less than $10,000 shall be deemed, for all purposes of this Article VII, not to be a breach of such representation or warranty and shall not be
counted against the Deductible. 
 (b) The maximum amount of Indemnified Amounts that the Purchaser will be entitled to recover from
Teledrift and the Stockholders pursuant to Section 7.2(a) and pursuant to Section 7.2(b) to the extent Section 7.2(b) relates to pre-closing covenants shall equal 30% of the Purchase Price (the “Cap”). Furthermore,
the maximum amount of Indemnified Amounts that the Purchaser shall be entitled to recover from a Stockholder will not exceed such Stockholder’s Proportionate Ownership times the Cap. 
 (c) Notwithstanding anything herein to the contrary, neither the Deductible nor the Cap shall apply to any Indemnified Amounts arising from a breach of
Section 3.4(a), 3.9(a), 3.10(a) or 3.18 or any claim arising from actual fraud. The maximum amount of Liabilities that the Purchaser will be entitled to recover from Teledrift and the Stockholders pursuant to Section 7.2(a) with respect to
breaches of Section 3.4(a), 3.9(a), 3.10(a) or 3.18 shall equal the Purchase Price. 
  

 26 

 (d) The amount of any Indemnified Amounts for which Purchaser claims indemnification under this Agreement
shall be reduced by: (i) any insurance proceeds paid to the indemnifying party with respect to such Indemnified Amounts; and (ii) indemnification or reimbursement payments received by the indemnified party from third parties with respect
to such Indemnified Amounts. 
 (e) Notwithstanding any provision herein to the contrary, Teledrift and the Stockholders shall have no
liability for any breach of a representation or warranty in this Agreement by Teledrift or the Stockholders of which any of the Persons described in Schedule 7.6(e) had actual knowledge of the existence of the breach on or prior to the date of this
Agreement. 
 Section 7.7 Waiver of Other Representations. 
 (a) NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, IT IS THE EXPLICIT INTENT OF EACH PARTY HERETO, AND THE PARTIES HEREBY AGREE, THAT NONE OF THE
PARTIES HERETO OR ANY OF THEIR AFFILIATES OR REPRESENTATIVES HAS MADE OR IS MAKING ANY REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WRITTEN OR ORAL, INCLUDING ANY IMPLIED REPRESENTATION OR WARRANTY AS TO THE CONDITION, MERCHANTABILITY,
USAGE, SUITABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE WITH RESPECT TO THE ACQUIRED ASSETS, THE BUSINESS, OR ANY PART THEREOF, EXCEPT THOSE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT, AND WITHOUT IN ANY WAY LIMITING THE FOREGOING,
TELEDRIFT AND THE STOCKHOLDERS MAKE NO REPRESENTATION OR WARRANTY TO PURCHASER WITH RESPECT TO ANY FINANCIAL PROJECTIONS OR FORECASTS RELATING TO THE BUSINESS. 
 (b) EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN, THE ACQUIRED ASSETS ARE BEING TRANSFERRED “AS IS, WHERE IS, WITH ALL FAULTS,” AND TELEDRIFT AND THE STOCKHOLDERS EXPRESSLY DISCLAIM ANY REPRESENTATIONS OR
WARRANTIES OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, AS TO THE CONDITION, VALUE OR QUALITY OF THE ACQUIRED ASSETS. 
 Section 7.8
Exclusive Remedy. No Party shall have any liability, and no Party shall make any claim, for any Liability or other matter (and each of the Parties hereby waives any right of contribution against the other and their respective
Affiliates), under, arising out of or relating to this Agreement, any other document, agreement, certificate or other matter delivered pursuant hereto or the transactions contemplated hereby, whether based on contract, tort, strict liability, other
Laws or otherwise, except as provided in this Article VII or for any remedy available to the Purchaser for actual fraud. 
 TELEDRIFT AND STOCKHOLDERS
ACKNOWLEDGE THAT THE INDEMNIFICATION OBLIGATIONS OF TELEDRIFT AND STOCKHOLDERS HEREIN ENTITLE PURCHASER TO RECOVER ACTUAL DAMAGES SUFFERED BY PURCHASER, INCLUDING 

  

 27 

 
ACTUAL DAMAGES ARISING FROM A BREACH OF A REPRESENTATION OR WARRANTY. NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, NO PARTY HERETO SHALL BE LIABLE FOR
SPECIAL, PUNITIVE, EXEMPLARY, INCIDENTAL, CONSEQUENTIAL OR INDIRECT DAMAGES, ARISING FROM A BREACH OF ANY REPRESENTATION OR WARRANTY OR PRE-CLOSING COVENANT UNDER THIS AGREEMENT (EXCEPT WITH RESPECT TO ANY CLAIM, ACTION, SUIT, PROCEEDING, OR
INVESTIGATION BROUGHT BY A THIRD PARTY WHO IS NOT AN AFFILIATE OF PURCHASER WHICH CLAIM, ACTION, SUIT, PROCEEDING OR INVESTIGATION IS SUBJECT TO INDEMNIFICATION UNDER THIS ARTICLE VII) WHETHER BASED ON CONTRACT, TORT, STRICT LIABILITY, OTHER LAW OR
OTHERWISE AND WHETHER OR NOT ARISING FROM ANY OTHER PARTY’S SOLE, JOINT OR CONCURRENT NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT. THE LIMITATIONS OF THIS PARAGRAPH IS NOT APPLICABLE TO ANY ACTUAL FRAUD COMMITTED BY A PARTY. 
 ARTICLE VIII 
 TERMINATION

 Section 8.1 Termination. This Agreement may be terminated at any time prior to the Closing, as follows: 

(a) Teledrift shall have the right to terminate this Agreement: 
 (i) if the representations and warranties of Purchaser shall fail to be true and correct in all material respects (or in all respects in the case of any representation or warranty containing any materiality
qualification) on and as of the date made or, except in the case of any such representations and warranties made as of a specified date, on and as of any subsequent date as if made at and as of the subsequent date and such failure shall not have
been cured in all material respects (or in all respects in the case of any representation or warranty containing any materiality qualification) within 15 days after written notice of such failure is given to Purchaser by a Partner; 
 (ii) if Purchaser (A) fails to perform in any material respects any of its covenants (or in all respects in the case of any covenant containing any
materiality qualification) in this Agreement and (B) does not cure such default in all material respects (or in all respects in the case of any covenant containing any materiality qualification) within fifteen (15) days after written
notice of such default is given to Purchaser by Teledrift. 
 (iii) if the Transaction is not completed on or before the Termination Date
(provided that the right to terminate this Agreement under this Section 8.1(a)(iii) shall not be available to Teledrift if the failure of Teledrift or any Stockholder to fulfill any obligation to Purchaser under or in connection with this
Agreement has been the cause of or resulted in the failure of the Transaction to occur on or before such date); or 
 (iv) if the
Transaction is enjoined by a final, unappealable court order. 
 (b) Purchaser shall have the right to terminate this Agreement: 

(i) if the representations and warranties of Teledrift or any Stockholder shall fail to be true and correct in all material respects (or in all
respects in the case of any representation or warranty containing any materiality qualification) on and as of the date made or, except in the case of any such representations and warranties made as of a specified date, on and as of any subsequent
date as if made at and as of such subsequent date and such failure shall not have been cured in all material respects (or in all respects in the case of any representation or warranty containing any materiality qualification) within fifteen
(15) days after written notice of such failure is given to Teledrift and the Stockholders by Purchaser; 
  

 28 

 (ii) if Teledrift or the Stockholders (A) fail to perform in any material respect (or in all
respects in the case of any covenant containing any materiality qualification) any of their covenants in this Agreement and (B) do not cure such default in all material respects (or in all respects in the case of any covenant containing any
materiality qualification) within 15 days after notice of such default is given to Teledrift and the Stockholders; or 
 (iii) if the
Transaction is not completed on or before the Termination Date (provided that the right to terminate this Agreement under this Section 8.1(b)(iii) shall not be available to Purchaser if the failure of Purchaser to fulfill any obligation to
Teledrift under or in connection with this Agreement, has been the cause of or resulted in the failure of the Transaction to occur on or before such date). 
 (c) Purchaser and Teledrift may terminate this Agreement upon the execution of a written agreement to that effect. 
 Section 8.2 Effect of Termination. In the event of termination of this Agreement by either Purchaser or Teledrift pursuant to the provisions of Section 8.1, this Agreement shall forthwith become void and there shall
be no further obligations on the part of Teledrift, Purchaser, or their respective officers or directors, or the Stockholders (except as set forth in this Section 8.2 and in Section 5.2 and Article X, all of which shall survive the
termination). Nothing in this Section 8.2 shall relieve any party from liability for any breach of this Agreement. 
 ARTICLE IX 

 DEFINITIONS 
 Section 9.1 Definitions. For purposes of this Agreement: 
 “Affiliates” means a Person
controlling, controlled by, or under common control with, the Person to whom the reference is made. 
 “Base Balance Sheet”
means the consolidated balance sheet of Teledrift as of the Base Balance Sheet Date included in the Financial Statements. 
 “Base
Balance Sheet Date” means September 30, 2007. 
 “Business” means the business and operations conducted by
Teledrift prior to the Effective Time. 
 “Code” means the Internal Revenue Code of 1986, and any successor statute.

  

 29 

 “Contract” means any legally binding obligation or agreement, whether or not reduced to
writing, and specifically including, without limitation, any client or customer agreement, note, bond, mortgage, lease of real or personal property (including, without limitation, automobile, vehicle and other equipment leases), license and other
instrument. 
 “Disclosure Schedule” means the disclosure schedule which has been delivered by Teledrift and the
Stockholders to Purchaser in connection with the execution and delivery of this Agreement arranged in sections corresponding to the numbered and lettered sections and subsections contained in Article III. 
 “Funded Debt” means any Liability for borrowed money. 
 “GAAP” means generally accepted accounting principles, consistently applied, of the United States of America, as applicable. 
 “Governmental Authority” means any nation, province, state or political subdivision thereof, and any agency, natural Person or other
entity exercising executive, legislative, regulatory or administrative functions of or pertaining to government. 
 “HSR
Act” means the Hart Scott Rodino Antitrust Improvements Act of 1976, as amended. 
 “Intellectual Property” means
all of the following in any jurisdiction throughout the world: (a) inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all patents, patent applications, and patent disclosures,
together with all reissuances, continuations, continuations-in-part, revisions, extensions, and reexaminations thereof, (b) all trademarks, service marks, trade dress, logos, slogans, trade names, corporate names, Internet domain names, and
rights in telephone numbers, together with all translations, adaptations, derivations, and combinations thereof and including all goodwill associated therewith, and all applications, registrations, and renewals in connection therewith, (c) all
copyrightable works, all copyrights, and all applications, registrations, and renewals in connection therewith, (d) all mask works and all applications, registrations, and renewals in connection therewith, (e) all trade secrets and
confidential business information (including ideas, research and development, know-how, formulas, compositions, manufacturing and production processes and techniques, technical data, designs, drawings, specifications, customer and supplier lists,
pricing and cost information, and business and marketing plans and proposals), (f) all computer software (including source code, executable code, data, databases, and related documentation, (g) all other proprietary rights, and
(h) all copies and tangible embodiments thereof (in whatever form or medium). 
 “Knowledge of Teledrift” means the
actual knowledge of any Stockholder or of any of the officers of Teledrift listed on Schedule 9.1(a). 
 “Liabilities” means
all actual damages, liabilities or obligations of any nature whatsoever, whether absolute or contingent, due or to become due, accrued or unaccrued, known or unknown, or otherwise, including indebtedness for money borrowed, obligations under
Contracts, accounts payable, liabilities imposed by law and/or Governmental Authorities. 
  

 30 

 “Liens” means all mortgages, restrictions, liens, pledges, charges, claims, options,
calls, or encumbrance of any nature whatsoever. 
 “Material Adverse Effect” means any event, occurrence, change or
development, which has, or could reasonably be expected to have, a material adverse effect on the results of operations or financial condition of Teledrift taken as a whole, other than any event, occurrence, change or development (a) relating
to the economy in general (including commodities prices or exchange rates), (b) relating to the industry in which Teledrift operates in general, except to the extent such event, occurrence, change or development has, or could reasonably be
expected to have, a disproportionate effect on the results of operations or financial condition of Teledrift, (c) resulting from the announcement or pendency of the Transaction contemplated by this Agreement (including the impact thereof on
relationships, contractual or otherwise, with customers, suppliers, distributors, partners or employees), (d) changes in the law or in GAAP, or changes in general legal, regulatory or political conditions or (e) acts of war, sabotage or
terrorism, or any escalation or worsening of any such acts of war, sabotage or terrorism threatened or underway as of the date of this Agreement. 
 “Net Assets” shall mean the sum of the assets of Teledrift (excluding any Retained Assets), minus the Assumed Liabilities as of the Closing Date, in either case of a type required to be reflected on a balance sheet of
Teledrift, all as determined pursuant to GAAP. 
 “NYSE” means the New York Stock Exchange. 
 “Permitted Liens” means any of the following Liens: (a) Liens in favor of carriers, warehousemen, mechanics, landlords and
materialmen and other similar Persons that are incurred in the ordinary course of business for sums not yet due and payable; (b) Liens for current Taxes incurred in the ordinary course of business that are not delinquent or remain payable
without any penalty or are being contested in good faith by appropriate proceedings and with respect to which adequate reserves are maintained; (c) rights reserved to any Governmental Authority to regulate the affected property; (d) as to
any leased assets or properties, rights of the lessors thereof; (e) Liens incurred or deposits made in the ordinary course of the Business in connection with workers’ compensation and other types of social security, unemployment insurance,
or old age pension programs mandated under applicable laws or regulations; (f) restrictive covenants, easements and defects, imperfections or irregularities of title or Liens, if any, as would not reasonably be expected to result in a Material
Adverse Effect on Teledrift; (g) restrictions on transfer with respect to which consents or waivers are obtained for this Transaction; and (h) Liens entered into the ordinary course of business which do not secure the payment of
indebtedness for borrowed money and which do not materially and adversely affect the ability of Teledrift to conduct the Business; (i) Liens created by Purchaser or its Affiliates, or their successors and assigns and (j) Liens referenced
in the title policies with respect to the Owned Real Property which title policies are referenced on Schedule 9.1(c) to this Agreement. 
 “Person” means an association, a corporation, an individual, a partnership, a limited liability company, an unlimited liability company, a limited liability partnership, a trust or any other entity or organization.

 “Proportionate Ownership” means the ratios reflected on Schedule 9.1(b). 
  

 31 

 “Reasonable Efforts” means efforts in accordance with reasonable commercial practice and
without the incurrence of unreasonable expense. 
 “Restrictive Covenants” means the agreements made by the Stockholders
pursuant to the terms of Section 5.6. 
 “Subsidiaries” means any entity which is (a) controlled directly or
indirectly by Teledrift, or (b) with respect to which Teledrift directly or indirectly owns any equity interest. 
 “Targeted
Net Asset Amount” means $13,500,000. 
 “Tax” or “Taxes” means any federal, state, local, or
foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental (including taxes under Code Section 59A), customs duties, capital stock, franchise, profits,
withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, whether computed
on a separate or consolidated, unitary or combined basis or in any other manner, including any interest, penalty, or addition thereto, whether disputed or not. 
 “Termination Date” means February 22, 2008. 
 “Transaction” means the
transactions contemplated pursuant to this Agreement and all related agreements, documents, and instruments. 
 Section 9.2
Index. The definitions of certain terms are set forth in the Sections indicated: 
  

					
	Acquired Assets	  	Section 1.1	  	
	Allocation Schedule	  	Section 1.7	  	
	Arbitrator	  	Appendix A (iii)	  	
	Assigned Contracts	  	Section 1.1(e)	  	
	Assigned Leases	  	Section 1.1(d)	  	
	Assumed Liabilities	  	Section 1.3	  	
	Cap	  	Section 7.6(b)	  	
	Closing	  	Section 1.8	  	
	Closing Balance Sheet	  	Appendix A (i)	  	
	Closing Date	  	Section 1.8	  	
	Closing Net Assets	  	Appendix A (i)	  	
	Closing Net Assets Statement	  	Appendix A (i)	  	
	COBRA	  	Section 5.6(b)	  	
	Company Facilities	  	Section 3.9(c)	  	
	Company Permits	  	Section 3.14	  	
	Deductible	  	Section 7.6(a)	  	
	Deferred Contracts	  	Section 4.5	  	
	Effective Time	  	Section 1.8	  	
	Employees	  	Section 3.12(a)	  	
	Employee Plans	  	Section 3.12(c)	  	

  

 32 

					
	Employment Agreements	  	Section 3.12(c)	  	
	Environmental Laws	  	Section 3.19	  	
	Environmental Permits	  	Section 3.19	  	
	ERISA	  	Section 3.12(c)	  	
	Financing	  	Section 4.7	  	
	Financial Statements	  	Section 3.5	  	
	Flotek	  	Preamble	  	
	Indemnified Amounts	  	Section 7.2	  	
	Interim Financial Statements	  	Section 3.5	  	
	Inventory	  	Section 3.8	  	
	Lease	  	Section 3.9(b)	  	
	Leased Premises	  	Section 3.9(b)	  	
	Material Contracts	  	Section 3.20	  	
	Purchase Price	  	Section 1.3	  	
	Owned Real Estate	  	Section 3.9(a)	  	
	Retained Assets	  	Section 1.2	  	
	Stockholder or Stockholders	  	Preamble	  	
	Tax Returns	  	Section 3.18(a)	  	
	Teledrift	  	Preamble	  	
	Teledrift Fee Obligation	  	Section 3.21	  	
	Territory	  	Section 5.5(a)	  	

 ARTICLE X 
 MISCELLANEOUS 
 Section 10.1 Remedies. If any legal action or other proceeding is
brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default or misrepresentation in connection with any of the provisions of this Agreement, the successful or prevailing party or parties shall be entitled to
recover reasonable attorneys’ fees and other costs incurred in that action or proceeding in addition to any other relief to which it or he may be entitled at law or equity. 
 Section 10.2 Notices. All notices, consents, demands or other communications required or permitted to be given pursuant to this
Agreement shall be deemed sufficiently given: (i) when delivered personally during a business day to the appropriate location described below or telefaxed to the telefax number indicated below (with confirmation of transmission), or
(ii) five (5) business days after the posting thereof by United States first class, registered or certified mail, return receipt requested, with postage fee prepaid and addressed: 
  

					
	If to Purchaser or Flotek:	  	2930 West Sam Houston Parkway North, Ste. 300
		  	Houston, Texas 77043	  	
		  	Telefax No. (713) 896-4511	  	
			
	With a copy to:	  	Casey W. Doherty	  	
		  	Doherty & Doherty LLP	  	
		  	1717 St. James Place, Suite 520	  	
		  	Houston, Texas 77056	  	
		  	Telefax No. (713) 572-1001	  	

  

 33 

					
	 If to Teledrift (prior to
 Closing) or the Stockholders:

	  	Max Weldon	  	
		  	c/o Teledrift	  	
		  	812 S. E. 83rd	  	
		  	Oklahoma City, Oklahoma 73143	  	
		  	Telefax No. (405) 631-8344	  	
			
	With a copy to:	  	Christopher S. Collins	  	
		  	Vinson & Elkins LLP	  	
		  	1001 Fannin, Suite 2500	  	
		  	Houston, Texas 77002	  	
		  	Telefax No. (713) 615-5883	  	

 Section 10.3 Successors. This Agreement shall be binding upon each of the
parties upon their execution, and inure to the benefit of the parties hereto and their successors and assigns. Specifically, but not by way of limitation, Purchaser shall be permitted to assign and transfer all of or portion of its rights hereunder
to any Affiliate of Flotek provided that Flotek continues to be an obligor with respect to such assigned obligations following such assignments. 
 Section 10.4 Severability. In the event that any one or more of the provisions contained in this Agreement or in any other instrument referred to herein, shall, for any reason, be held to be invalid, illegal, or
unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Agreement or any such other instrument. 
 Section 10.5 Section Headings. The section headings used herein are descriptive only and shall have no legal force or effect whatsoever. Except to the extent the context specifically indicates
otherwise, all references to articles and sections refer to articles and sections of this Agreement, and all references to the exhibits and schedules refer to exhibits and schedules attached hereto, each of which is made a part hereof for all
purposes. 
 Section 10.6 Gender. Whenever the context so requires, the masculine shall include the feminine and neuter,
and the singular shall include the plural and conversely. 
 Section 10.7 Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of Texas, U.S.A., applicable to agreements and contracts executed and to be wholly performed there, without giving effect to the conflicts of law principles thereof. Exclusive venue for any
legal or equitable action relating to this Agreement or the Transaction shall lie in Harris County, Texas. 
 Section 10.8
Multiple Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original. 
  

 34 

 Section 10.9 Waiver. Any waiver by either party to be enforceable must be in writing
and no waiver by either party shall constitute a continuing waiver. 
 Section 10.10 Entire Agreement. This Agreement and
the other agreements referred to herein set forth the entire understanding of the parties hereto relating to the subject matter hereof and thereof and supersede all prior agreements and understandings among or between any of the parties relating to
the subject matter hereof and thereof. 
 [SIGNATURE PAGE FOLLOWS] 
  

 35 

 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first set forth
above. 
  

			
	TELEDRIFT ACQUISITION, INC., a Delaware corporation
		
	By:	 	 /s/ Jerry D. Dumas, Sr.

	Name:	 	 Jerry D. Dumas, Sr.

	Title:	 	 Chief Executive Officer

	
	FLOTEK INDUSTRIES, INC., a Delaware corporation
		
	By:	 	 /s/ Jerry D. Dumas, Sr.
  

	Name:	 	 Jerry D. Dumas, Sr.

	Title:	 	 Chief Executive Officer

	
	TELEDRIFT, INC. an Oklahoma corporation
		
	By:	 	 /s/ Max Weldon

	Name:	 	 Max Weldon

	Title:	 	 President, CEO

	
	 /s/ Floyd Bergen

	Floyd Bergen
	
	 /s/ Dean DuCray

	Dean DuCray
	
	 /s/ Max Weldon

	Max Weldon
	
	 /s/ Manoj Gopalan

	Manoj Gopalan

 Appendix A 
 (i) Closing Balance Sheet. Within sixty (60) days following the Closing Date, Purchaser shall prepare and deliver to Teledrift a consolidated balance sheet of Teledrift as of the close of business on the
Closing Date (the “Closing Balance Sheet”), and a statement of the Net Assets (the “Closing Net Assets Statement”) as reflected on the face of the Closing Balance Sheet (the “Closing Net Assets”).
The Closing Balance Sheet will be prepared in accordance with GAAP (except for the absence of footnotes and subject to normal year end adjustments), taking into account any physical inspections of the inventory, and using the same accounting
methods, policies, practices and procedures, with consistent classifications and estimation methodologies, as were used in the preparation of the Base Balance Sheet, to the extent applicable, and will not include any changes in assets or liabilities
as a result of purchase accounting adjustments arising from or resulting as a consequence of the Transaction. 
 (ii) Disagreement.
During the forty-five (45) day period following its delivery of the Closing Net Assets Statement to Teledrift, Purchaser shall provide to Teledrift reasonable access to all relevant books and records and personnel of Purchaser and the Business
to enable Teledrift to evaluate the accuracy of the Closing Net Assets Statement. If Teledrift disagrees with the determination of the Closing Net Assets as shown on the Closing Net Assets Statement, Teledrift shall notify Purchaser in writing of
such disagreement within such forty-five (45) day period, which notice shall describe the nature of any such disagreement in reasonable detail, identify the specific items involved and the dollar amount of each such disagreement and provide
reasonable supporting documentation for each such disagreement. Any item not objected to by Teledrift by the conclusion of the forty-five (45) day period shall be deemed agreed to by Teledrift. 
 (iii) Resolution. If Purchaser and Teledrift are unable to resolve any disagreements properly identified by Teledrift pursuant to the foregoing
paragraph within thirty (30) days after delivery to Purchaser of written notice of such disagreements, then such disagreements shall be submitted for final and binding resolution to PricewaterhouseCoopers or if PricewaterhouseCoopers is not
able to so serve to such other accounting firm as may be agreed upon by Purchaser and Teledrift (the “Arbitrator”). The Arbitrator will only consider those items and amounts set forth in the Closing Net Assets Statement as to which
Purchaser and Teledrift have disagreed within the time periods and on the terms specified above and must resolve the matter in accordance with the terms and provisions of this Agreement. The Arbitrator shall deliver to Purchaser and Teledrift, as
promptly as practicable and in any event within ninety (90) days after its appointment, a written report setting forth the resolution of any such disagreement determined in accordance with the terms of this Agreement. The Arbitrator shall
select the position of either Purchaser or Teledrift as a resolution for each item of disagreement and may not impose an alternative resolution. The Arbitrator shall make its determination based solely on presentations and supporting material
provided by the parties and not pursuant to any independent review. The determination of the Arbitrator shall be final and binding. The fees of the Arbitrator shall be borne by the Stockholders, on the one hand, and Purchaser on the other hand, in
such amount(s) as shall be determined by the Arbitrator based on the proportion that the aggregate amount of disputed items submitted to the Arbitrator that is unsuccessfully disputed by the Stockholders, on the one hand, or Purchaser on the other
hand, as determined by the Arbitrator, bears to the total amount of such disputed items so referred to the Arbitrator for resolution. 
  

 Appendix A 

 (v) Purchase Price Adjustment. Any amounts owing under Appendix A by the Purchaser or by Teledrift
shall be paid within three (3) business days after the amount owed pursuant to Appendix A is finally determined. Interest shall accrue with respect to any amounts owed pursuant to this Appendix A from the Closing Date until the date paid at the
prime rate charged by Wells Fargo Bank NA from time to time. 
  

 Appendix A

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