Document:

exv4w1

 

Exhibit 4.1

REGISTRATION RIGHTS, STANDSTILL AND VOTING AGREEMENT

     This REGISTRATION RIGHTS, STANDSTILL AND VOTING AGREEMENT (this “Agreement”), dated as
of August 31, 2005, is by and between Precision Drilling Corporation, an Alberta corporation
(“Precision”) and Weatherford International Ltd., a Bermuda exempted company
(“Weatherford”). Certain capitalized terms used herein are defined in Section 7 below.
Capitalized terms not otherwise defined herein have the meaning ascribed to them in the Stock
Purchase Agreement (as hereinafter defined).

RECITALS:

     WHEREAS, Precision and Weatherford have entered into a Stock Purchase Agreement, dated as of
June 6, 2005 (the “Stock Purchase Agreement”), that provides, subject to the terms and
conditions thereof, for the purchase by Weatherford of 100% of the issued and outstanding shares of
capital stock of certain subsidiaries of Precision (the “Stock Purchase”);

     WHEREAS, as part of the consideration to be paid in the Stock Purchase, Precision will acquire
26,000,000 common shares (the “Acquired Shares”), par value $1.00 per share, of Weatherford
(the “Common Shares”), which Common Shares is listed on the New York Stock Exchange;

     WHEREAS, in order to induce Precision to consummate the transactions under the Stock Purchase
Agreement, Weatherford has agreed to provide certain registration rights on the terms and subject
to the conditions set forth herein;

     WHEREAS, in order to induce Weatherford to consummate the transactions under the Stock
Purchase Agreement, Precision has agreed to be bound by certain standstill and voting provisions on
the terms and subject to the conditions set forth herein; and

     WHEREAS, it is a condition to the closing of the transactions under the Stock Purchase
Agreement that Precision and Weatherford enter into this Agreement;

     NOW, THEREFORE, in consideration of the premises and the covenants and agreements contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby agree as
follows:

SECTION 1. REGISTRATION UNDER THE SECURITIES ACT.

	 	1.1	 	Registration.

     As promptly as possible after the date that Precision gives Weatherford notice of Precision’s
intent to distribute all of the Registrable Shares to its shareholders pro rata either as a
dividend or pursuant to a distribution that is not exempt under the Securities Act and is not a
distribution of exempted securities (within the meaning of the Securities Act), and in any event
prior to the date that is thirty (30) business days following the date of any such notice,
Weatherford shall prepare and file with the Securities and Exchange Commission (the “SEC”)
a

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Registration Statement on the appropriate form for the purpose of registering under the
Securities Act all of the Registrable Shares for distribution by Precision to its shareholders in
the manner as set forth in such notice (the “Registration Statement”). The registration
effected pursuant to this Section l.1 is referred to herein as the “Registration.”
Weatherford agrees to use its reasonable best efforts to cause the Registration Statement to be
declared effective as soon as practicable after the filing thereof with the SEC. Weatherford shall
keep the Registration Statement effective (including through the filing of any required
post-effective amendments) until the earlier to occur of (i) the date after which all of the
Registrable Shares registered thereunder shall have been distributed by Precision pro rata as a
dividend to the shareholders of Precision and (ii) 60 days after the effective date of the
Registration Statement; provided, that such date shall be extended by the amount of time of any
period during which Precision may not use the Registration Statement pursuant to the terms of
Section 1.2(e) below or as a result of a breach by Weatherford of its obligations hereunder.
Thereafter, Weatherford shall be entitled to withdraw the Registration Statement and, upon such
withdrawal, Precision shall have no further right to distribute any of the Registrable Shares
pursuant to the Registration Statement (or any prospectus relating thereto).

     1.2 Registration Procedures. Subject to the terms and conditions hereof, whenever any
Registrable Securities are required to be registered pursuant to this Agreement, Weatherford shall
use its reasonable best efforts to effect the registration and the sale or distribution of such
Registrable Securities in accordance with the intended method of disposition thereof, and pursuant
thereto Weatherford shall as expeditiously as practicable:

	 	(a)	 	promptly prepare and file with the SEC a registration statement with respect to
such Registrable Securities (and any amendment, including any post-effective amendment,
to such registration statement Weatherford deems to be necessary) and use its
reasonable best efforts to cause such registration statement to become effective and to
comply with the provisions of the Securities Act applicable to it (provided that before
filing a registration statement or prospectus or any amendments or supplements thereto,
Weatherford shall furnish to counsel for Precision copies of all such documents
proposed to be filed so as to provide Precision and its counsel a reasonable
opportunity to review and comment on such documents, and such documents shall be
subject to the review and comment of Precision and its counsel);
	 
	 	(b)	 	furnish to Precision such number of copies of such registration statement, each
amendment and supplement thereto, the prospectus included in such registration
statement (including each preliminary prospectus) and such other documents as Precision
may reasonably request in order to facilitate the distribution of the Registrable
Securities owned by Precision to its shareholders pro rata as a dividend;
	 
	 	(c)	 	make such filings of the preliminary and final prospectus, and any amended or
supplemented prospectus, as may be required under Rule 424 and keep the registration
statement with respect to such Registrable Securities effective for the time periods
specified in Section 1.1 in order to permit the prospectus forming a

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	 	 	 	part thereof to be usable for the offer and sale or distribution of the Registrable
Securities owned by Precision to its shareholders pro rata as a dividend;
	 
	 	(d)	 	use its reasonable best efforts to register or qualify such Registrable
Securities under such other securities or blue sky laws of such jurisdictions as
Precision (or any other holder whose securities are included in a registration
statement on which Registrable Securities are registered) reasonably requests and do
any and all other acts and things which may be reasonably necessary or advisable to
enable Precision to consummate the disposition in such jurisdictions of the Registrable
Securities owned by Precision (provided that Weatherford shall not be required to (i)
qualify generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this subsection, (ii) subject itself to taxation in any
such jurisdiction or (iii) consent to general service of process in any such
jurisdiction);
	 
	 	(e)	 	notify Precision, at any time when a prospectus relating thereto is required to
be delivered under the Securities Act (i) when a registration statement or any
post-effective amendment has become effective under the Securities Act, (ii) of the
happening of any event as a result of which the prospectus included in such
registration statement contains an untrue statement of a material fact or omits any
fact necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading (whereupon Precision shall immediately cease any
offers, sales or other distribution of Registrable Securities thereunder), and, at the
request of Precision, Weatherford shall prepare a supplement or amendment to such
prospectus so that, as thereafter delivered to the shareholders of Precision in
connection with the distribution of such Registrable Securities, such prospectus shall
not contain an untrue statement of a material fact or omit to state any fact necessary
to make the statements therein, in light of the circumstances under which they were
made, not misleading, and (iii) of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or preventing the
use of any related prospectus or suspending the qualification of any of the Registrable
Securities included in such registration statement for sale or distribution in any
jurisdiction;
	 
	 	(f)	 	cause all such Registrable Securities to be listed on each securities exchange
on which similar securities issued by Weatherford are then listed and, if not so
listed, to be listed on a securities exchange or on the NASD automated quotation system
and, if listed on the NASD automated quotation system, use its reasonable best efforts
to secure designation of all such Registrable Securities covered by such registration
statement as a NASDAQ “national market system security” within the meaning of Rule
11Aa2-1 of the Exchange Act or, failing that, to secure NASDAQ authorization for such
Registrable Securities;
	 
	 	(g)	 	provide a transfer agent and registrar for all such Registrable Securities not
later than the effective date of such registration statement;

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	 	(h)	 	otherwise use its reasonable best efforts to comply with all applicable rules
and regulations of the SEC, and make available to its security holders, as soon as
reasonably practicable, an earning statement covering the period of at least twelve
months beginning with the first day of Weatherford’s first full fiscal quarter after
the effective date of the registration statement, which earning statement shall satisfy
the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;
	 
	 	(i)	 	permit Precision, if Precision is an underwriter or controlling person of
Weatherford, to participate in the preparation of such registration or comparable
statement and to require the insertion therein of material relating to the Precision or
the plan of distribution of the Registrable Securities, furnished to Weatherford in
writing, which in the reasonable judgment of Precision and its counsel should be
included;
	 
	 	(j)	 	in the event of the issuance of any stop order suspending the effectiveness of
a registration statement, or of any order suspending or preventing the use of any
related prospectus or suspending the qualification of any Registrable Securities
included in such registration statement for sale or distribution in any jurisdiction,
Weatherford shall use its reasonable best efforts promptly to obtain the withdrawal of
such order and shall prepare and file an amended or supplemented prospectus, if
required; and
	 
	 	(k)	 	use its reasonable best efforts to cause such Registrable Securities covered by
such registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable Precision to
consummate the distribution of such Registrable Securities to its shareholders pro rata
as a dividend.

	 	1.3	 	Expenses.

	 	(a)	 	Registration Expenses. All Registration Expenses shall be borne by
Weatherford.
	 
	 	(b)	 	Selling Expenses. All fees and expenses of counsel for Precision, state
securities or blue sky fees and expenses, fees and expenses of Precision’s transfer
agent, and any broker or dealer discounts or commissions attributable to the sale or
distribution of Registrable Securities shall be borne solely by Precision.

SECTION 2. LOCKUP AGREEMENT.

     2.1 Except for distributions by Precision to its shareholders pro rata either as a dividend or
other distribution method pursuant to the Registration Statement, Precision hereby agrees to not
effect any public sale or distribution (including any sales pursuant to Rule 144) of equity
securities of Weatherford, or any securities convertible into or exchangeable or exercisable for
such securities, during the seven days prior to and the 90-day period beginning on the effective
date of any underwritten registered public offering of equity securities of Weatherford or
securities convertible or exchangeable into or exercisable for equity securities of Weatherford
(except as part of such underwritten registration), unless the underwriters managing

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the registered public offering otherwise agree, and Precision will deliver an undertaking to
the managing underwriters (if requested) consistent with this covenant. Precision shall not be
obligated to comply the provisions of this Section 2.1 more than two times in any 12-month period.

SECTION 3. INDEMNIFICATION.

     3.1 Indemnification by Weatherford. Weatherford agrees to indemnify, to the extent permitted
by law, Precision, its officers and directors and each Person who controls Precision (within the
meaning of the Securities Act) against all losses, claims, damages, liabilities, and expenses
caused by any untrue or alleged untrue statement of material fact contained in any registration
statement, prospectus or preliminary prospectus, or any amendment thereof or supplement thereto or
any omission or alleged omission of a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as the same are caused by or contained
in any information furnished in writing to Weatherford by Precision expressly for use therein or by
the failure of Precision to deliver a copy of the registration statement or prospectus or any
amendments or supplements thereto after Weatherford has furnished Precision with a sufficient
number of copies of the same.

     3.2 Indemnification by Precision. In connection with any registration statement in which
Precision is participating, Precision shall furnish to Weatherford in writing such information as
Weatherford reasonably requests for use in connection with any such registration statement or
prospectus and, to the extent permitted by law, shall indemnify Weatherford, its directors and
officers, and each Person who controls Weatherford (within the meaning of the Securities Act)
against any losses, claims, damages, liabilities, and expenses resulting from any untrue or alleged
untrue statement of material fact contained in the registration statement, prospectus, or
preliminary prospectus, or any amendment thereof or supplement thereto or any omission or alleged
omission of a material fact required to be stated therein or necessary to make the statements
therein not misleading, but only to the extent that any information so furnished in writing by
Precision contains such untrue statement or omits a material fact required to be stated therein
necessary to make the statements therein not misleading; provided, however, that any such
obligation of Precision to indemnify Weatherford hereunder shall be limited to the aggregate value
of the Acquired Shares at the effective date of the Registration Statement.

     3.3 Indemnification Procedures. Any Person entitled to indemnification hereunder shall (i)
give prompt written notice to the indemnifying party of any claim with respect to which it seeks
indemnification (provided that the failure to give prompt notice shall not impair any Person’s
right to indemnification hereunder to the extent such failure has not prejudiced the indemnifying
party) and (ii) unless in such indemnified party’s reasonable judgment a conflict of interest
between such indemnified and indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the
indemnified party. If such defense is assumed, the indemnifying party shall not be subject to any
liability for any settlement made by the indemnified party without its consent (but such consent
shall not be unreasonably withheld). An indemnifying party who is not entitled to, or elects not
to, assume the defense of a claim shall not be obligated to pay the fees and expenses of more than
one counsel (in addition to local counsel) for all parties indemnified by such indemnifying party
with respect to such claim, unless in the reasonable judgment of any

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indemnified party a conflict of interest may exist between such indemnified party and any
other of such indemnified parties with respect to such claim.

     3.4 Investigation; Contribution. The indemnification provided for under this Agreement shall
remain in full force and effect regardless of any investigation made by or on behalf of the
indemnified party or any officer, director, or controlling Person of such indemnified party and
shall survive the transfer of securities. If the indemnification provided under Section 3.1 or
Section 3.2 this Agreement is for any reason unavailable to, or insufficient to hold harmless, an
indemnified party, then each indemnifying party shall contribute to the amount paid or payable to
the indemnified party or parties an amount that is proportionate to reflect the relative fault of
such indemnifying party on the one hand and the indemnified party or parties on the other.

SECTION 4. RULE 144 TRANSACTIONS.

     4.1 Undertaking to File Reports and Cooperate in Rule 144 Transactions. For as long as
Precision continues to hold any Common Shares, Weatherford shall use its reasonable best efforts to
file with the SEC, on a timely basis, all annual, quarterly and other periodic reports required to
be filed by it under Sections 13 and 15(d) of the Exchange Act, and the rules and regulations
thereunder; provided, however, that the foregoing shall not be construed to require
Weatherford to prepare and file periodic reports if it is not required to do so under the Exchange
Act. In the event of any proposed sale by Precision of Common Shares pursuant to Rule 144 under the
Securities Act or otherwise as provided herein, which sale is to be made in accordance with the
terms of Section 5.1(b) hereof, Weatherford shall cooperate with Precision so as to enable such
sales to be made in accordance with applicable laws, rules and regulations, the requirements of the
transfer agent of Weatherford, and the reasonable requirements of the broker through which the
sales are proposed to be executed, and shall, upon request, furnish unlegended certificates
representing ownership of the shares of Common Shares sold thereby, such certificates to be
furnished in such numbers and denominations as Precision may reasonably request.

SECTION 5. RESTRICTIONS ON TRANSFER.

     5.1 Permitted Transfers. Precision hereby agrees that, until it and any permitted transferees
under paragraph (d) or (f) hereunder have disposed of all of the Registrable Securities, it will
not, directly or indirectly, without the prior written consent of Weatherford, sell, distribute,
transfer or otherwise dispose of any shares of Common Shares except:

	 	(a)	 	pro rata distributions of shares of Common Shares by Precision to its public
shareholders either pursuant to a stock dividend or other distribution method, in each
case pursuant to the Registration Statement; or
	 
	 	(b)	 	sales of Common Shares pursuant to Rule 144 (but not paragraph (k) thereof)
under the Securities Act; or
	 
	 	(c)	 	sales or transfers of shares of Common Shares to any Person or group of related
Persons who would immediately thereafter not own or have the right to acquire or

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	 	 	 	vote Common Shares having in the aggregate more than five percent (5%) of the total
combined voting power of all Common Shares then outstanding; or
	 
	 	(d)	 	a bona fide pledge of or the granting of a security interest in the shares of
Common Shares to an institutional lender for money borrowed, provided that such
lender acknowledges in writing that it has received a copy of this Agreement and
agrees, upon its becoming the owner of, or obtaining dispositive authority with respect
to or in connection with any disposition of, any such shares of Common Shares, to be
bound by the provisions of this Agreement in connection with any right it may have to
dispose of or vote any such shares of Common Shares (and, upon agreeing so to be bound,
the provisions of this Agreement shall inure to the benefit of such party); or
	 
	 	(e)	 	sales or transfers of Common Shares pursuant to a tender or exchange offer
which the Board of Directors of Weatherford does not oppose within 10 business days
after the date of commencement (as such term is defined in Rule 14d-2(a) of the General
Rules and Regulations under the Exchange Act) of such offer; or
	 
	 	(f)	 	dispositions of shares of Common Shares by Precision to any wholly owned
subsidiary of Precision or to a successor corporation of Precision; provided,
however, that in each such case, the transferee shall receive and hold such
Common Shares subject to, and the transferee and all of the transferees’ Affiliates
shall agree to be bound by, all the terms of this Agreement, which terms shall also
inure to the benefit of such transferees, and there shall be no further transfer of
such shares except in accordance with the provisions of this Section 5.1; or
	 
	 	(g)	 	dispositions pursuant to any merger, consolidation, reorganization or
recapitalization to which Weatherford is a party or in connection with any
reclassification of the Common Shares; or
	 
	 	(h)	 	distributions to Precision’s shareholders pursuant to an exemption under the
Securities Act or pursuant to a distribution of exempted securities (within the meaning
of the Securities Act).

     5.2 Permitted Purchases. Precision hereby agrees that, until it and any permitted transferees
under Section 5.1(d) or (f) hereof have disposed of all of the Registrable Securities in accordance
with this Agreement, neither it nor any of its Affiliates will, without the prior written consent
of Weatherford, acquire, directly or indirectly, by purchase or otherwise, any shares of Common
Shares or any securities convertible into, exchangeable for, or that represent a right to acquire,
Common Shares, if after such acquisition (and assuming the exercise of all conversion and other
rights to acquire Common Shares by Precision without assuming the concurrent exercise of such
conversion and other rights by any other holders) Precision would be, in the aggregate, the
“beneficial owner” (determined in accordance with Rule 13d-3 under the Exchange Act) of more than
the greater of 5.0% of the total combined voting or dispositive power of all outstanding Common
Shares.

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SECTION 6. VOTING RESTRICTIONS

     6.1 Agreement to Vote. For so long as Precision or any permitted transferee under Section
5.1(d) or (f) hereof holds any Registrable Securities, Precision (or such permitted transferee)
shall, on each matter presented for a vote at any duly convened meeting of the shareholders of
Weatherford, and in any action by written consent of the shareholders of Weatherford in lieu of a
meeting, vote all shares of Common Shares held by Precision (or such permitted transferee) in the
same proportions as the Public Shares are voted. “Public Shares” means, with respect to any
record date, all issued and outstanding shares of Common Shares on such record date, other than
shares directly or indirectly beneficially owned by Precision, any permitted transferee under
Section 5.1(d) or (f) hereof, or any of their respective Affiliates (including any shares subject
to voting trusts, voting agreements or similar agreements to which Precision, any such permitted
transferee, or any of their respective Affiliates is a party or of which any of them is a
beneficiary) and other than shares directly or indirectly beneficially owned by any Affiliate of
Weatherford.

     6.2 Proxy; Further Assurances. If requested by Weatherford, each of Precision and any
permitted transferee under Section 5.1(d) or (f) hereof shall (a) execute and deliver a proxy in
favor of Weatherford (or other person or persons designated by Weatherford) with respect to any
shares of Common Shares owned by Precision or such permitted transferee in connection with each
shareholders’ meeting or action by written consent; and (b) execute and deliver, or otherwise
provide, such other documents and instruments and take all such further actions as may be
reasonably necessary in order to effectuate the provisions of this Agreement.

SECTION 7. DEFINITIONS.

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

     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations thereunder, or any successor statute.

     “Person” means any individual, firm, partnership, corporation, trust, joint venture,
limited liability company, association, joint stock company, unincorporated organization, or any
other entity or organization, including a governmental entity or any department, agency, or
political subdivision thereof.

     “Registrable Securities” means (i) the Acquired Shares, (ii) any other shares of
Common Shares issued as a dividend or other distribution on or as a result of a subdivision,
combination, or reclassification of any Acquired Shares; and (iii) any Common Shares issued to
Precision in any merger, consolidation, or business combination involving Weatherford.

     “Registration Expenses” means all expenses incident to Weatherford’s performance of or
compliance with this Agreement, including without limitation all registration and filing fees, fees
and expenses of compliance with securities or blue sky laws, fees with respect to filings required
to be made with the NASD, printing expenses, messenger and delivery and mailing expenses, fees and
disbursements of custodians, and fees and disbursements of counsel for Weatherford

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and all independent certified public accountants retained by Weatherford and other Persons
retained by Weatherford.

     “Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any successor statute.

SECTION 8. MISCELLANEOUS.

	 	8.1	 	Legends and Stop Transfer Orders.

	 	(a)	 	Precision hereby agrees that all certificates representing Registrable
Securities, and any certificates representing any other shares of Common Shares
presently owned or are hereafter acquired by Precision, shall have the following legend
(or other legend to the same effect): “The shares represented by this certificate are
subject to restrictions on transfer and other restrictions pursuant to the provisions
of a Registration Rights, Standstill and Voting Agreement, dated August 31, 2005,
between Precision Drilling Corporation and Weatherford International Ltd., a copy of
which is on file at the office of the corporate secretary of Weatherford International
Ltd.”
	 
	 	(b)	 	Precision hereby agrees to the entry of stop transfer orders with the transfer
agent and registrar of the Common Shares against the transfer (other than in compliance
with this Agreement) of legended securities held by Precision (or its permitted
transferees under Section 5.1(d) or (f) hereof).
	 
	 	(c)	 	Weatherford agrees to remove any stop transfer orders provided in paragraph (b)
above in sufficient time to permit any party to make any transfer permitted by the
terms of this Agreement.

     8.2 No Inconsistent Agreements. Weatherford shall not hereafter enter into any agreement with
respect to its securities which is inconsistent with or violates the rights granted to Precision in
this Agreement.

     8.3 Specific Performance. The parties hereto acknowledge and agree that in the event of any
breach of this Agreement, the non-breaching parties would be irreparably harmed and could not be
made whole by monetary damages. It is accordingly agreed that the parties hereto shall and do
hereby waive the defense in any action for specific performance that a remedy at law would be
adequate and that the parties hereto, in addition to any other remedy to which they may be entitled
at law or in equity, shall be entitled to compel specific performance of this Agreement in any
action instituted hereunder.

     8.4 Amendments and Waivers. The failure of any party to enforce any of the provisions of this
Agreement shall in no way be construed as a waiver of such provisions and shall not affect the
right of such party thereafter to enforce each and every provision of this Agreement in accordance
with its terms. No modification, amendment, or waiver of any provision of this Agreement shall be
effective against Weatherford or Precision except by a written agreement signed by Weatherford and
Precision.

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     8.5 Successors and Assigns. All covenants and agreements in this Agreement by or on behalf of
any of the parties hereto shall bind and inure to the benefit of the respective successors and
permitted assigns of the parties hereto whether so expressed or not including, without limitation,
any Person which is the successor to Weatherford or Precision.

     8.6 Severability. If any term, provision, covenant or restriction of this Agreement, or any
part thereof, is held by a court of competent jurisdiction or any foreign federal, state, county,
or local government or any other governmental, regulatory, or administrative agency or authority to
be invalid, void, unenforceable, or against public policy for any reason, the remainder of the
terms, provisions, covenants, and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired, or invalidated.

     8.7 Entire Agreement. Except as otherwise expressly set forth herein, this document embodies
the complete agreement and understanding among the parties hereto with respect to the subject
matter hereof and supersedes and preempts any prior understandings, agreements, or representations
by or among the parties, written or oral, which may have related to the subject matter hereof in
any way.

     8.8 Counterparts. This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which shall constitute one and the same instrument, and it
shall not be necessary in making proof of this Agreement to produce or account for more than one
such counterpart.

     8.9 Headings. The headings in this Agreement are for convenience of reference only and shall
not limit or otherwise affect the meaning of terms contained herein.

     8.10 GOVERNING LAW; CONSENT OF JURISDICTION; WAIVER OF JURY TRIAL. THIS AGREEMENT AND THE
VALIDITY AND PERFORMANCE OF THE TERMS HEREOF SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW OR CHOICE OF
LAW, EXCEPT TO THE EXTENT THAT THE LAWS OF BERMUDA REGULATE THE ISSUANCE OF SECURITIES BY
WEATHERFORD. THE PARTIES HERETO HEREBY AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING DIRECTLY OR
INDIRECTLY FROM OR IN CONNECTION WITH THIS AGREEMENT SHALL BE LITIGATED ONLY IN THE STATE OR
FEDERAL COURTS LOCATED IN MANHATTAN IN THE STATE OF NEW YORK. TO THE EXTENT PERMITTED BY APPLICABLE
LAW, THE PARTIES HERETO CONSENT TO THE JURISDICTION AND VENUE OF THE FOREGOING COURTS AND CONSENT
THAT ANY PROCESS OR NOTICE OF MOTION OR OTHER APPLICATION TO EITHER OF SAID COURTS OR A JUDGE
THEREOF MAY BE SERVED INSIDE OR OUTSIDE THE STATE OF NEW YORK BY REGISTERED MAIL, RETURN RECEIPT
REQUESTED, DIRECTED TO SUCH PARTY AT ITS ADDRESS SET FORTH IN THIS AGREEMENT (AND SERVICE SO MADE
SHALL BE DEEMED COMPLETE FIVE (5) DAYS AFTER THE SAME HAS BEEN POSTED AS AFORESAID) OR BY PERSONAL
SERVICE OR IN SUCH OTHER MANNER AS MAY BE PERMISSIBLE UNDER THE RULES OF SAID COURTS. THE PARTIES
HERETO HEREBY WAIVE ANY RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION PURSUANT TO THIS
AGREEMENT.

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     8.11 Notices. Any notice or other communication required or which may be given hereunder
shall be in writing and shall be delivered personally, telecopied with confirmed receipt, sent by
certified, registered, or express mail, postage prepaid, or sent by a national next-day delivery
service. Such notice or other communication shall be sent to the recipient party at the address
indicated on the signature page of this Agreement or to such other address or to the attention of
such other person as the recipient party has specified by prior written notice to the sending party
and shall be deemed given when so delivered personally or telecopied, or if mailed, 5 days after
the date of mailing, or, if by national next-day delivery service, on the day after delivery to
such service.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first
above written.

	 	 	 	 	 
	 	PRECISION DRILLING CORPORATION

 	 
	 	By:  	/s/ Michael J. McNulty
 	 
	 	 	Name:  	Michael J. McNulty 	 
	 	 	Title:  	Senior Vice President, Operations,
Finance
	 	 	Address:  	4200, 150-6th 
Avenue S.W.
Calgary, Alberta T2P 3Y7
Attn: Chief Financial Officer 	 
	 
	 	WEATHERFORD INTERNATIONAL LTD.

 	 
	 	By:  	/s/ Burt M. Martin
 	 
	 	 	Name:  	Burt M. Martin 	 
	 	 	Title:  	Senior Vice President, General Counsel

& Secretary
	 	 	Address:	515 Post Oak Boulevard, Suite 600
Houston, Texas 77027
Attn: General Counsel 	 
	 

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Exhibit 10.1

AGREEMENT

     This AGREEMENT (this “Agreement”), dated as of August 31, 2005, is by and between
PRECISION DRILLING CORPORATION, an Alberta corporation (“Seller”), and WEATHERFORD
INTERNATIONAL LTD., a Bermuda exempted company (“Purchaser”).

     WHEREAS, Seller and Purchaser hereby acknowledge that, due to a scrivener’s error, the
definition of “Seller Retained Liabilities” contained in the Stock Purchase Agreement, dated as of
June 6, 2005, by and between Seller and Purchaser (the “Stock Purchase Agreement”), does
not reflect the true intentions of the Seller and Purchaser; and

     NOW, THEREFORE, in consideration of the premises and the covenants and agreements contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties hereto hereby agree as
follows:

     1. Seller does hereby, upon the terms and subject to the conditions of the Stock Purchase
Agreement, assume, and agree to discharge or perform when due, all of the Seller Retained
Liabilities (as the scope of such liabilities are defined pursuant to this Agreement). Section
8.9(l) of the Stock Purchase Agreement is hereby deleted in its entirety and replaced with the
following:

     “Seller Retained Liabilities” means any and all of the following
indebtedness, liabilities and obligations of any of the Seller Companies or any of
them in existence at or attributable to periods prior to and including the Closing,
to the extent not reflected in the Closing Date Balance Sheet or the Seller
Disclosure Letter: (a) any liability or claim for liability (whether in contract, in
tort or otherwise, and whether or not successful) related to any Employee including,
without limitation, any workers’ compensation or worker injury claim or any
termination or severance obligations for any Employee described in Section 5.9(g)
hereof; (b) any liability or claim for liability (whether in contract, in tort, or
otherwise, and whether or not successful) related to the administration or
termination of, or any benefits under, any Seller Plan; (c) any obligation,
liability or claim for liability (whether in contract, in tort or otherwise, and
whether or not successful) of Seller or any of the Seller Companies to Seller or any
of its other Subsidiaries or any of their Affiliates described in Section 5.8
hereof; (d) all fees and expenses of Seller or any of the Seller Companies described
in Section 3.17 or Section 5.8 hereof, and (e) without restricting the generality of
the foregoing, any and all liabilities, debts and obligations of any of the Seller
Companies or any of their Affiliates arising from, relating to or based upon the
matters described in Sections 5.1, 5.11, 5.12 and 5.22 hereof and Schedule 5.12 of
the Seller Disclosure Letter. The indebtedness, liabilities and obligations of
Seller or any of the Seller Companies described above shall constitute the “Seller
Retained Liabilities” notwithstanding that claims in respect of such indebtedness,
liabilities or obligations arose, or claims in respect thereof were made, after the
Closing Date.

     2. Under no circumstances shall Section 8.9(l) of the Stock Purchase Agreement, as amended
herein, affect, limit or restrict any indebtedness, liabilities or obligations of the Seller
arising from its agreements and covenants in the Stock Purchase Agreement.

 

 

     3. All capitalized terms used but not otherwise defined in this Agreement shall have the
meanings ascribed to such terms in the Stock Purchase Agreement.

     4. Each reference in the Stock Purchase Agreement shall, unless the context otherwise
requires, mean the Stock Purchase Agreement as amended by this Agreement.

     5. The Stock Purchase Agreement, as amended hereby, is in all respects ratified, approved and
confirmed.

     6. This Agreement may be executed in any number of counterparts, all of which together make
and shall constitute one and the same instrument and any of the parties hereto may execute this
Agreement by signing any such counterpart.

     7. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS
OF THE PROVINCE OF ALBERTA AND FEDERAL LAWS OF CANADA APPLICABLE THERETO WITHOUT GIVING EFFECT TO
CHOICE OF LAW PRINCIPLES. THE PARTIES HERETO AGREE THAT THE COURTS OF THE PROVINCE OF ALBERTA
SHALL HAVE EXCLUSIVE JURISDICTION TO DETERMINE ALL DISPUTES AND CLAIMS ARISING BETWEEN THE PARTIES
HERETO.

     IN WITNESS WHEREOF, the undersigned has signed this Agreement as of August 31, 2005.

	 	 	 	 	 
	 	PRECISION DRILLING CORPORATION

 	 
	 	By:  	/s/ Michael J. McNulty
 	 
	 	 	Name:  	Michael J. McNulty 	 
	 	 	Title:  	Senior Vice President, Operations, Finance 	 
	 

	 	 	 	 	 
	 	WEATHERFORD INTERNATIONAL LTD.

 	 
	 	By:  	/s/ Burt M. Martin
 	 
	 	 	Name:  	Burt M. Martin 	 
	 	 	Title:  	Senior Vice President, General Counsel &
Secretary

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