Document:

exv10w1

 

Exhibit 10.1

CONVERSION AGREEMENT

     CONVERSION AGREEMENT (the “Agreement”), dated as of May 16, 2007, by and between Willbros
Group, Inc., a corporation organized under the laws of the Republic of Panama, with headquarters
located at Plaza 2000 Building, 50th Street, 8th Floor, P.O. Box 0816-01098, Panama, Republic of
Panama (the “Company”), and Kamunting Street Master Fund, Ltd. (“Buyer”). Capitalized terms used
herein and not otherwise defined herein shall have the respective meanings set forth in the
Purchase Agreement (as defined below).

WHEREAS:

     A. Pursuant to a Securities Purchase Agreement dated as of December 22, 2005 by and among the
Company, Buyer and certain other buyers party thereto (“Purchase Agreement”), the Company sold to
Buyer the Company’s 6.50% Senior Convertible Notes due 2012 (the “Notes”) convertible into the
Company’s common stock, par value $0.05 per share (the “Common Stock”), at a conversion rate (the
"Conversion Rate”) of 56.9606 shares of Common Stock per $1000 principal amount of the Notes in
accordance with the terms of the Notes and that certain Indenture by and among the Company,
Willbros USA, Inc., a Delaware corporation and wholly-owned Subsidiary of the Company, as guarantor
(“WUSA”), and The Bank of New York, as trustee, dated as of December 23, 2005 (the “Indenture”).

     B. No event has occurred which would result in an adjustment of the Conversion Rate from the
initial Conversion Rate described above.

     C. Contemporaneously with the execution and delivery of the Purchase Agreement, the parties to
the Purchase Agreement executed a Registration Rights Agreement, (the “Registration Rights
Agreement” and collectively with the Indenture, the Notes, the Purchase Agreement and the other
contracts, agreements and deliverables entered into in connection therewith, the “Transaction
Documents”) pursuant to which the Company provided certain registration rights to Buyer with
respect to the resale of the Common Stock into which the Notes may be converted.

     D. Buyer wishes to convert all of the Notes held by Buyer into shares of Common Stock pursuant
to the terms hereof and of the Notes and Indenture (the “Conversion Shares”).

     E. In consideration of such conversions, the Company intends to pay in cash to Buyer $247.50
per $1000 of principal amount of Notes converted pursuant to the terms hereof (the “Conversion
Consideration”).

     NOW, THEREFORE, the Company and Buyer hereby agree as follows:

	 	(1)	 	ISSUANCE OF CONVERSION SHARES; PAYMENT OF ACCRUED INTEREST
AND CONSIDERATION.

          (a) As provided for in the Notes and the Indenture, the Company shall issue the
Conversion Shares to Buyer upon receipt of the Conversion Notice on the Closing Date (as
hereinafter defined).

 

 

          (b) The Company shall, on the Closing Date, pay to Buyer by wire transfer to the
account set forth on Schedule I hereto, the accrued but unpaid interest, if any, on the
Notes being converted pursuant to such Conversion Notice through and including the Closing
Date.

          (c) The Company shall, on the Closing Date, pay to Buyer by wire transfer to the
account set forth on Schedule I hereto the Conversion Consideration.

(2) CONVERSION; CLOSING.

          (a) Procedure. Buyer elects to convert the principal amount of Notes set forth
on Schedule I held by Buyer into shares of Common Stock pursuant to Article 12 of the
Indenture, by delivering the executed notice of conversion to the Company at the Closing in
the form attached to the Note (the “Conversion Notice”). The Company shall effect delivery
of the Conversion Shares to Buyer through the Deposit/Withdrawal at Custodian system of the
Depository Trust Company on the Closing Date. Except as otherwise expressly set forth to
the contrary herein, the conversion shall be effected upon the terms set forth in the Notes
and Indenture (including in respect of rounding and fractional shares). Notwithstanding,
Section 12.14 of the Indenture, all Notes converted pursuant
hereto shall be converted into shares of Common Stock.

          (b) Closing. The date and time of the closing (the “Closing”) of the
transactions specified in Sections 1 and 2 above (the “Closing Date”) shall be, subject to
the satisfaction (or waiver) of the closing conditions set forth in Sections 5 and 6 hereto)
10:00 a.m., New York City Time, on the Trading Day (as defined in the Indenture) immediately
following the date of the 8-K Filing required by the terms hereof at the offices of Schulte
Roth & Zabel LLP, 919 Third Avenue, New York, New York 10022. At Closing, (i) Buyer shall
deliver to the Company the Conversion Notice setting forth the entire principal amount of
Notes held by Buyer which Buyer has elected to convert pursuant to the terms hereof, and
(ii) the Company shall pay the Conversion Consideration, and all accrued and unpaid
interest, if any, in the amounts set forth in Section 1 hereof.

(3) REGISTRATION RIGHTS.

          (a) Registered Securities. The Company acknowledges and agrees that the
Conversion Shares to be issued pursuant hereto are registered for resale pursuant to an
effective Shelf Registration Statement (as defined in, and required by, the Registration
Rights Agreement).

(4) REPRESENTATIONS, WARRANTIES AND COVENANTS.

          (a) Buyer Representations and Warranties. Buyer hereby represents and warrants
to the Company that:

               i) Buyer was duly organized or formed and is a validly existing organization in
good standing under the laws of its jurisdiction of organization, with power and
authority to execute and deliver this Agreement and

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perform its obligations hereunder; and this Agreement and the transactions
contemplated hereby have been duly authorized by Buyer.

               ii) Assuming due authorization, execution and delivery by the Company of this
Agreement, it constitutes a legally valid and binding agreement of Buyer, enforceable
against Buyer in accordance with its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance or transfer, reorganization, moratorium and similar
laws affecting creditors’ rights and remedies generally, and to general principles of
equity, including principles of materiality commercial reasonableness, good faith and
fair dealing (regardless of whether enforcement is sought in a proceeding at law or in
equity). 

          (b) Company Representations and Warranties.

               i) Exchange Act Documents; Financial Statements. The Company’s Annual
Report on Form 10-K for the fiscal year ended December 31, 2006 filed with the SEC on
March 14, 2007 (the “2006 10-K”) and all other documents filed by the Company with the
Securities and Exchange Commission (the “SEC”) pursuant to the Securities Exchange Act
of 1934, as amended, and the rules and regulations of the SEC thereunder (collectively,
the “Exchange Act”) since January 1, 2004 (as amended or supplemented from time to time
prior to the date hereof, including the exhibits thereto, the “Exchange Act Documents”),
when taken together, do not contain an untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. As of their respective filing
dates, except as disclosed in note 2 of the Notes to Consolidated Financial Statements
and under the caption “Overview—Restatement” in Item 7 (Management’s Discussion and
Analysis of Financial Condition and Results of Operations), each included in the
Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2004, filed
with the SEC on November 22, 2005, (x) the financial statements of the Company included
in the Exchange Act Documents complied as to form in all material respects with
applicable accounting requirements and the published rules and regulations of the SEC
with respect thereto and present fairly, in all material respects, the consolidated
financial position of the Company and its consolidated subsidiaries as of the dates
indicated and the results of their operations and the changes in their consolidated cash
flows for the periods specified therein and (y) said financial statements have been
prepared in conformity with generally accepted accounting principles and practices
(“GAAP”) applied on a consistent basis, except as indicated in the notes thereto or, in
the case of unaudited statements, as permitted by Rule 10-01 of Regulation S-X
promulgated by the SEC. No other information provided by or on behalf of the Company to
Buyer in connection with the transactions contemplated hereby which is not included in
the SEC Documents, contains any untrue statement of a material fact or omits to state
any material fact necessary in order to make the statements therein, in the light of the
circumstance under which they are or were made, not misleading.

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               ii) Absence of Material Adverse Effect. Since the Company’s 2006 10-K,
there has not been any Material Adverse Change. Since the 2006 10-K, the Company has
not entered into any transaction or agreement that has or would be reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect. As used in this
Agreement, “Material Adverse Change” or “Material Adverse Effect” means any change or
effect that would be materially adverse to the business, properties, condition
(financial or otherwise) or results of operations of the Company and its consolidated
subsidiaries considered as a single enterprise, or to the ability or authority of the
Company to consummate the transactions contemplated hereby on the terms set forth
herein, provided that any reduction in the market price or trading volume of the
Company’s publicly traded common stock shall not, in any event, be deemed to constitute
a Material Adverse Change or a Material Adverse Effect (it being understood that the
foregoing shall not prevent a person from asserting that any underlying cause of such
reduction independently constitutes such a Material Adverse Change or Material Adverse
Effect).

               iii) Solvency. Neither the Company nor any of its Subsidiaries (as
hereinafter defined) has taken any steps to seek protection pursuant to any bankruptcy
law nor does the Company have knowledge that its creditors or its Subsidiaries’
creditors intend to initiate involuntary bankruptcy proceedings or knowledge of any fact
which would reasonably lead a creditor to do so. The Company is not as of the date
hereof, and after giving effect to the transactions contemplated hereby will not be,
Insolvent (as defined below). As used in this Agreement, “Insolvent” means (i) the
present fair saleable value of the Company’s assets is less than the amount required to
pay the Company’s known liabilities and identified contingent liabilities, (ii) the
Company is unable to pay its debts and liabilities, subordinated, contingent or
otherwise, as such debts and liabilities become absolute and matured or (iii) the
Company has unreasonably small capital with which to conduct the business in which it is
engaged as such business is now conducted.

               iv) Organization and Qualification. The Company has been duly incorporated
and is validly existing as a corporation in good standing under the laws of the Republic
of Panama, with corporate power and authority to own or lease its properties and conduct
its business as described in the Exchange Act Documents, and has been duly qualified as
a foreign corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties, or conducts its
business in a manner or to an extent that would require such qualification, other than
such failures to be so qualified or in good standing as, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.

               v) Subsidiaries. Each Subsidiary of the Company has been duly organized
and is validly existing as a corporation, partnership or limited liability company in
good standing under the laws of the jurisdiction in which it is chartered or organized
with full power and authority to own or lease, as the case may be, and to operate its
properties and conduct its business as currently operated and conducted, and is duly
qualified to do business as a foreign corporation, partnership or limited

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liability company and is in good standing under the laws of each jurisdiction which
requires such qualification, except where the failure so to qualify or to be in good
standing would not, individually or in the aggregate, result in a Material Adverse
Effect; all the issued and outstanding shares of capital stock of or other ownership
interests in each such Subsidiary have been duly authorized and validly issued and, with
respect to each such Subsidiary which is a corporation, are fully paid and
non-assessable. As used in this Agreement, “Subsidiary” means any entity of which the
Company (either alone or through or together with one or more of its Subsidiaries) owns
or holds, directly or indirectly, through one or more intermediaries, more than 50% of
the stock or other equity interests of such entity, (B) any entity of which stock or
other equity interests having the power to elect a majority of that entity’s board of
directors or similar governing body, or otherwise having the power to direct the
business and policies of such entity, are held or owned, directly or indirectly, through
one or more intermediaries, by the Company (either alone or through or together with one
or more of its Subsidiaries), or (C) any entity , the operations of which are
consolidated or combined with the Company, pursuant to GAAP, for financial reporting
purposes.

               vi) Authorization; Enforcement; Validity. The Company has the requisite
power and authority to enter into and perform its obligations under this Agreement and
to issue the Conversion Shares in accordance with the terms hereof. The execution and
delivery of the Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby, including, without limitation, the issuance of the
Conversion Shares and the payment of Conversion Consideration, accrued interest, if any,
have been duly authorized by the Company’s Board of Directors and no further filing,
consent, or authorization is required by the Company, its Board of Directors or its
stockholders, except for the filing of the 8-K Filing contemplated by Section 4(c)
hereunder. This Agreement has been duly executed and delivered by the Company, and
constitutes the legal, valid and binding obligations of the Company, enforceable against
the Company in accordance with its terms, except as such enforceability may be limited
by general principles of equity or applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws relating to, or affecting generally, the
enforcement of applicable creditors’ rights and remedies, and except that rights to
indemnification and contribution hereunder may be limited by federal or state securities
laws or public policy relating thereto.

               vii) Issuance of Securities. The issuance of the Conversion Shares is duly
authorized and such shares are free from all taxes, liens and charges with respect to
the issuance hereof. The offer and issuance by the Company of the Conversion Shares and
the payment of the Conversion Consideration in conformity with the terms of this
Agreement constitute transactions exempt from registration under the Securities Act of
1933, as amended (the “Securities Act”).

               viii) No Conflicts. The execution, delivery and performance of the
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby (including, without limitation, the issuance of the Conversion
Shares) will not (i) result in a breach of any of the terms or provisions of,

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constitute a default (with or without the giving of notice or the passage of time
or otherwise) under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which the Company is a
party or by which the Company is bound or to which any of the property or assets of the
Company is subject except, in each case, for such conflicts, breaches, defaults, liens,
charges or encumbrances which would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect, (ii) result in any violation of the
provisions of the Amended and Restated Certificate of Incorporation, as amended, or the
Restated Bylaws of the Company, each as in effect on the date hereof, (iii) result in
any violation of any material applicable law or statute or any order, rule or regulation
of any court or governmental agency or of any self-regulatory agency or body having
jurisdiction over the Company or any of its properties or (iv) result in a violation of
any of the rules and regulations of the New York Stock Exchange (the “Principal Market”)
applicable to the Company or by which any property or asset of the Company or any of its
Subsidiaries is bound or affected.

               ix) Consents. The Company is not required to obtain any consent, approval,
authorization, order, license, registration or qualification of, or make any filing or
registration with, any court, governmental agency or any regulatory or self-regulatory
agency or body or any other Person in order for it to execute, deliver or perform any of
its obligations under or contemplated by the Agreement, in each case in accordance with
the terms hereof, except for the 8-K Filing and post closing securities filings or
notifications to be made under federal or state securities laws. All consents,
authorizations, orders, filings and registrations which the Company is required to
obtain pursuant to the preceding sentence have been or will be obtained or effected on
or prior to the Closing Date. The Company and its Subsidiaries are unaware of any facts
or circumstances which might prevent the Company from obtaining or effecting any of the
registration, application or filings pursuant to the preceding sentence. The Company is
not in violation of the applicable listing requirements of the Principal Market and has
no knowledge of any facts which would reasonably lead to delisting or suspension of the
Common Stock. The issuance by the Company of the Conversion Shares shall not have the
effect of delisting or suspending the Common Stock from the Principal Market.

               x) Absence of Litigation. Except as described in Item 3, “Legal
Proceedings” of the 2006 10-K and the Notes to Consolidated Financial Statements
thereto, there are no legal or governmental investigations, actions, suits or
proceedings pending or, to the Company’s knowledge, threatened against or affecting the
Company, its Subsidiaries or any of its properties or to which the Company or its
Subsidiaries is or may be a party or to which any property of the Company is or may be
the subject that, if determined adversely to the Company, would, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.

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               xi) Conversion Rate. No event has occurred which would result in an
adjustment of the Conversion Rate from the initial Conversion Rate described in Recital
A.

          (c) Disclosure of Transactions and Other Material Information. The Company
shall file a current report on Form 8-K (the “8-K Filing”) on or before 8:30 a.m., New York
City time, on May 17, 2007, in the form required by the Exchange Act, relating to the
transactions contemplated by this Agreement and attaching this Agreement or a form hereof
(including, without limitation, all schedules and exhibits to this Agreement) as an exhibit
to such filing. At the time of the 8-K Filing, the Company shall not have provided Buyer
with any material, nonpublic information that is not disclosed in the 8-K Filing.

          (d) Material Non-Public Information. Other than as set forth in the 8-K
Filing, the Company covenants and agrees that neither it nor any other person or entity
acting on its behalf has provided or will provide Buyer or its agents or counsel with any
information that constitutes material non-public information, unless prior thereto Buyer
shall have executed a written agreement regarding the confidentiality and use of such
information. The Company understands and confirms that Buyer shall be relying on the
foregoing representations in effecting transactions in securities of the Company.

          (e) Publication. In the event of a breach of the foregoing covenant by the
Company or any of its Subsidiaries, or any of its or their respective officers, directors,
employees and agents, in addition to any other remedy provided herein, Buyer shall have the
right to make a public disclosure, in the form of a press release, public advertisement or
otherwise, of such material, nonpublic information without the prior approval by the
Company, its Subsidiaries, or any of its or their respective officers, directors, employees
or agents. Buyer shall have no liability to the Company, its Subsidiaries, or any of its or
their respective officers, directors, employees, stockholders or agents, for any such
disclosure. Subject to the foregoing, neither the Company, its Subsidiaries nor Buyer shall
issue any press releases or any other public statements with respect to the transactions
contemplated hereby; provided, however, that the Company shall be entitled, without the
prior approval of Buyer, to make any press release or other public disclosure with respect
to such transactions (i) in substantial conformity with the 8-K Filing and contemporaneously
therewith and (ii) as is required by applicable law and regulations (provided that in the
case of clause (i) Buyer shall be consulted by the Company in connection with any such press
release or other public disclosure prior to its release).

          (f) Holding Period. For the purposes of Rule 144, the Company acknowledges
that, under current SEC interpretations of the holding period requirement included in Rule
144, the holding period of the corresponding Conversion Shares may be tacked onto the
holding period of the Notes, and the Company agrees not to take a position contrary to this
Section 4(f). The Company’s representation, covenant and agreement set forth in this
Section 4(f) shall be subject in all respects to Rule 144 and other applicable securities
laws, and contrary interpretations thereof as may be in effect from time to time subsequent
to the date of this Agreement.

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          (g) Offer to Other Holders. The Company has not and will not offer to any
holder of Notes (other than Buyer) (each, an “Other Holder”) terms more favorable to such
holder than those of the Buyer and this Agreement. After the date hereof, the Company shall
not enter into any conversion agreement with an Other Holder of Notes until the date three
Business Days (as defined in the Indenture) after the date hereof. The Company agrees that
if it enters into any agreement with any Other Holder prior to the twelve (12) month
anniversary of the Closing on terms more favorable to such holder than those of Buyer and
this Agreement, then without any further action by Buyer or the Company, this Agreement
shall be deemed amended and modified in an economically and legally equivalent manner such
that Buyer shall receive the benefit of the more favorable terms contained in such agreement
and the Company will at its expense, take such other actions (such as entering into
amendments to this Agreement) as Buyer may reasonably request to further effectuate the
foregoing. Notwithstanding the foregoing, Buyer acknowledges and agrees that the Conversion
Consideration is based on the pricing grid attached hereto as Annex I (the “Pricing Grid”)
and, accordingly, any modification of the Conversion Consideration which the Company may
agree to pay to an Other Holder which is based on the Pricing Grid shall not be deemed to be
a term more favorable to such holder than the Conversion Consideration paid to the Buyer
under this Agreement.

(5) CONDITIONS TO COMPANY’S OBLIGATIONS HEREUNDER.

               The obligations of the Company to Buyer hereunder are subject to the satisfaction of each of
the following conditions, provided that these conditions are for the Company’s sole benefit and may
be waived by the Company at any time in its sole discretion by providing Buyer with prior written
notice thereof:

               (a) Buyer shall have executed this Agreement and delivered the same to the Company.

               (b) Buyer shall have delivered to the Company a Conversion Notice.

               (c) The representations and warranties of Buyer shall be true and correct in all
material respects (except for those representations and warranties that are qualified by
materiality or Material Adverse Effect, which shall be true and correct in all respects) as
of the date when made and as of the Closing Date as though made at that time (except for
representations and warranties that speak as of a specific date).

(6) CONDITIONS TO BUYER’S OBLIGATIONS HEREUNDER.

               The obligations of Buyer hereunder are subject to the satisfaction of each of the following
conditions, provided that these conditions are for Buyer’s sole benefit and may be waived by Buyer
in respect of itself at any time in its sole discretion by providing the Company with prior written
notice thereof:

               (a) The Company shall have executed this Agreement and delivered the same to Buyer.

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               (b) The Conversion Shares shall continue to be registered for resale pursuant to an
effective Shelf Registration Statement.

               (c) The Company shall have delivered to Buyer, Buyer’s Conversion Consideration, and
all accrued and unpaid interest, if any, in respect of the Notes being converted by Buyer
pursuant to the terms hereof.

               (d) The Company shall have paid to Schulte Roth & Zabel LLP the Buyer Counsel Expense
(as defined below).

               (e) The representations and warranties of the Company under this Agreement shall be
true and correct in all material respects (except for those representations and warranties
that are qualified by materiality or Material Adverse Effect, which shall be true and
correct in all respects) as of the date when made and as of the Closing Date as though made
at that time (except for representations and warranties that speak as of a specific date)
and the Company shall have performed, satisfied and complied in all material respects with
the covenants, agreements and conditions required by this Agreement to be performed,
satisfied or complied with by the Company at or prior to the Closing Date and no Default or
Event of Default (each as defined in the Indenture) shall have occurred and be continuing on
the date hereof either immediately before or after giving effect to this Agreement in
accordance with its terms.

               (f) The Common Stock (I) shall be designated for quotation or listed on the Principal
Market and (II) shall not have been suspended, as of the Closing Date, by the SEC or the
Principal Market from trading on the Principal Market nor shall suspension by the SEC or the
Principal Market have been threatened, as of the Closing Date, either (A) in writing by the
SEC or the Principal Market or (B) by falling below the minimum listing maintenance
requirements of the Principal Market.

(7) INDEMNIFICATION BY THE COMPANY.

               (a) In consideration of Buyer’s obligations hereunder and the execution and delivery of
this Agreement, the Conversion Notices on the Closing Date and in addition to all of the
Company’s other obligations under this Agreement, the Company shall defend, protect,
indemnify and hold harmless Buyer and all of its and its investment managers’ stockholders,
partners, members, officers, directors, employees and direct or indirect investors and any
of the foregoing persons’ agents or other representatives (collectively, the “Buyer
Indemnitees”) from and against any losses, claims, damages, liabilities, judgments, fines,
penalties, charges, costs, reasonable attorneys’ fees, amounts paid in settlement or
expenses, joint or several, (collectively, “Buyer Claims”) incurred in investigating,
preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal
taken from the foregoing by or before any court or governmental, administrative or other
regulatory agency, body or the SEC, whether pending or threatened, whether or not the
Company is or may be a party thereto (“Buyer Indemnified Damages”), incurred by any Buyer
Indemnitee as a result of, or arising out of (i) any misrepresentation or breach of any
representation or warranty made by the Company in this Agreement or (ii) any breach of any
covenant, agreement or

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obligation of the Company contained in this Agreement. To the extent that the
foregoing undertaking by the Company may be unenforceable for any reason, the Company shall
make the maximum contribution to the payment and satisfaction of each of the Buyer
Indemnified Damages which is permissible under applicable law.

               (b) This indemnity shall not apply to amounts paid in settlement of any claim if such
settlement is effected without the prior written consent of the Company, which consent shall
not be unreasonably withheld or delayed. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of the Buyer Indemnitee and
shall survive the issuance of the Conversion Shares pursuant hereto.

               (c) Promptly after receipt by a Buyer Indemnitee under this Section 7 of notice of the
commencement of any action or proceeding (including any governmental action or proceeding)
involving a Buyer Claim, such Buyer Indemnitee shall, if a Buyer Claim in respect thereof is
to be made against the Company under this Section 7, deliver to the Company a written notice
of the commencement thereof, and the Company shall have the right to participate in, and, to
the extent the Company so desires, to assume control of the defense thereof with counsel
mutually satisfactory to the Company and the Buyer Indemnitee; provided, however, that a
Buyer Indemnitee shall have the right to retain its own counsel with the fees and expenses
of not more than one counsel for such Buyer Indemnitee to be paid by the Company, if, in the
reasonable opinion of the Buyer Indemnitee, the representation by such counsel of the Buyer
Indemnitee and the Company would be inappropriate due to actual or potential differing
interests between such Buyer Indemnitee and any other party represented by such counsel in
such proceeding. In no event shall the Company be liable for the fees and expenses of more
than one counsel separate from its own counsel for all Buyer Indemnitees in connection with
any one action or separate but similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances.

               (d) The Buyer Indemnitee shall cooperate with the Company in connection with any
negotiation or defense of any such action or Buyer Claim by the Company and shall furnish to
the Company such information as may be reasonably available to the Buyer Indemnitee which
relates to such action or Buyer Claim. The Company shall keep the Buyer Indemnitee
reasonably apprised at all times as to the status of the defense or any settlement
negotiations with respect thereto. The Company shall not be liable for any settlement of
any action, claim or proceeding effected without its prior written consent; provided,
however, that the Company shall not unreasonably withhold, delay or condition its consent.
The Company shall not, without the prior written consent of the Buyer Indemnitee, consent to
entry of any judgment or enter into any settlement or other compromise which does not
include as an unconditional term thereof the giving by the claimant or plaintiff to such
Indemnitee of a release from all liability in respect to such Buyer Claim or litigation.
Following indemnification as provided for hereunder, the Company shall be subrogated to all
rights of the Buyer Indemnitee with respect to all third parties, firms or corporations
relating to the matter for which indemnification has been made. The failure to deliver
written notice to the Company within a reasonable time of the commencement of any such
action shall not

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relieve the Company of any liability to the Buyer Indemnitee under this Section 7,
except to the extent that the Company is materially prejudiced in its ability to defend such
action.

               (e) The indemnification required by this Section 7 shall be made by periodic payments
of the amount thereof during the course of the investigation or defense, as and when bills
are received or expenses are incurred upon delivery to the Company of reasonable
documentation therefor setting forth such expenses in reasonable detail. Notwithstanding
anything to the contrary set forth herein, no Buyer Indemnitee shall be entitled to be
indemnified pursuant to this Section 7 for any Buyer Claim to the extent such claim arises
as a result of the Buyer Indemnitee’s gross negligence or willful misconduct; provided,
however, that the Company shall pay the expenses incurred by any such Buyer Indemnitee
hereunder, as such expenses are incurred, in connection with any proceeding in advance of
the final disposition, so long as the Company receives an undertaking by such Buyer
Indemnitee to repay such portion of the amounts attributable, based on a final
non-appealable determination, to such Buyer Indemnitee’s gross negligence or willful
misconduct; and provided, further, that the termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that such Buyer Indemnitee was either grossly
negligent or engaged in willful misconduct.

               (f) Payments made by the Company under this Section 7 shall be limited to the amount of
any liability or damage that remains after deducting therefrom any insurance proceeds and
any indemnity, contribution or other similar payment recovered by the Buyer Indemnitee from
any third party with respect thereto.

(8) TERMINATION.

               In the event that the Closing does not occur by May 25, 2007, due to the Company’s or Buyer’s
failure to satisfy the conditions set forth in Sections 5 and 6 hereof (and the nonbreaching
party’s failure to waive such unsatisfied conditions(s)), the nonbreaching party shall have the
option to terminate this Agreement with respect to such breaching party at the close of business on
such date without liability of any party to any other party. Upon such termination, the terms
hereof shall be null and void and the parties shall continue to comply with all terms and
conditions of the Transaction Documents, as in effect prior to the execution of this Agreement.

(9) MISCELLANEOUS.

          (a) Certain Expenses. Subject to receipt of supporting documentation, the
Company agrees to reimburse Buyer for the expenses of its counsel, Schulte Roth & Zabel LLP,
in an amount not to exceed $20,000, (the “Buyer Counsel Expense”) which amount shall be paid
at the Closing by wire transfer to an account designated by Schulte Roth & Zabel LLP prior
to the Closing. Except as set forth herein, each party to this Agreement shall bear its own
expenses in connection with the sale of the Conversion Shares.

-11-

 

          (b) Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the internal laws of
the State of New York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of New York.

          (c) Counterparts. This Agreement may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the other party;
provided that a facsimile signature shall be considered due execution and shall be binding
upon the signatory thereto with the same force and effect as if the signature were an
original, not a facsimile signature.

          (d) Headings. The headings of this Agreement are for convenience of reference
and shall not form part of, or affect the interpretation of, this Agreement.

          (e) Severability. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Agreement in that jurisdiction or the
validity or enforceability of any provision of this Agreement in any other jurisdiction.

          (f) Entire Agreement; Amendments. This Agreement shall supersede all other
prior oral or written agreements among Buyer, the Company, their affiliates and persons
acting on their behalf with respect to the matters discussed herein and therein, and this
Agreement, and the instruments referenced herein contain the entire understanding of the
parties with respect to the matters covered herein and therein. No provision of this
Agreement may be amended other than by an instrument in writing signed by the Company and
Buyer, and any amendment to this Agreement made in conformity with the provisions of this
Section 9(f) shall be binding on Buyer and the Company. No provision hereof may be waived
other than by an instrument in writing signed by the party against whom enforcement is
sought.

          (g) Notices. Any notices, consents, waivers or other communications required
or permitted to be given under the terms of this Agreement must be in writing and will be
deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is mechanically or
electronically generated and kept on file by the sending party); or (iii) one Business Day
after deposit with an overnight courier service, in each case properly addressed to the
party to receive the same. The addresses and facsimile numbers for such communications
shall be:

If to the Company:
 

Willbros
Group, Inc.

c/o Willbros USA, Inc.

4400 Post Oak Parkway, Suite 1000

Houston, Texas 77027

Telephone: (713) 403-8092

Facsimile: (713) 403-8136

Attention: General Counsel

-12-

 

with a copy (for informational purposes only) to:

Conner & Winters, LLP

4000 One Williams Center

Tulsa, Oklahoma 74172

Telephone: (918) 586-8961

Facsimile: (918) 586-8661

Attention: Mark D. Berman, Esq.

If to Buyer, to its address and facsimile number set forth on Schedule 1 hereto, or to such
other address and/or facsimile number and/or to the attention of such other Person as the
recipient party has specified by written notice given to each other party five (5) days
prior to the effectiveness of such change with a copy (for informational purposes only) to:

Schulte Roth & Zabel LLP

919 Third Avenue

New York, NY 10022

Telephone: (212) 756-2000

Facsimile: (212) 593-5955

Attention: Eleazer Klein, Esq.

Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver
or other communication, (B) mechanically or electronically generated by the sender’s
facsimile machine containing the time, date, recipient facsimile number and an image of the
first page of such transmission or (C) provided by an overnight courier service shall be
rebuttable evidence of personal service, receipt by facsimile or receipt from an overnight
courier service in accordance with clause (i), (ii) or (iii) above, respectively.

          (h) Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and assigns, including any
purchasers of the Notes.

          (i) No Third Party Beneficiaries. This Agreement is intended for the benefit
of the parties hereto and their respective permitted successors and assigns, and is not for
the benefit of, nor may any provision hereof be enforced by, any other Person.

          (j) Further Assurances. Each party shall do and perform, or cause to be done
and performed, all such further acts and things, and shall execute and deliver all such
other agreements, certificates, instruments and documents, as any other party may reasonably
request in order to carry out the intent and accomplish the purposes of this Agreement and
the consummation of the transactions contemplated hereby.

-13-

 

          (k) No Strict Construction. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no rules of
strict construction will be applied against any party.

          (l) Independent Nature of Buyer’s Obligations and Rights. Nothing contained
herein, and no action taken by Buyer pursuant hereto or in connection herewith, shall be
deemed to constitute Buyer and any other holder of the Notes as a partnership, an
association, a joint venture or any other kind of entity, or create a presumption that Buyer
is in any way acting in concert or as a group with any other holder of the Notes with
respect to such obligations. Buyer confirms that it has independently participated in the
negotiation of the transaction contemplated hereby with the advice of its own counsel and
advisors.

[Signature Page Follows]

-14-

 

     IN WITNESS WHEREOF, Buyer and the Company have caused their respective signature page to this
Conversion Agreement to be duly executed as of the date first written above.

	 	 	 	 	 
	 	COMPANY:

WILLBROS GROUP, INC.

 	 
	 	By:  	/s/ Van A. Welch
 	 
	 	 	Name:  	Van A. Welch 	 
	 	 	Title:  	Senior Vice President, Chief
Financial Officer and Treasurer 	 

 

 

	 	 	 	 	 

     IN WITNESS WHEREOF, Buyer and the Company have caused their respective signature page to this
Conversion Agreement to be duly executed as of the date first written above.

	 	 	 	 	 
	 	BUYER:

KAMUNTING STREET MASTER FUND, LTD.

 	 
	 	By:  	/s/ Christopher Falsetta
 	 
	 	 	Name:  	Christopher Falsetta 	 
	 	 	Title:  	Director 	 
	 

 

 

SCHEDULE 1

	 	 	 	 	 	 	 
	(1)	 	(2)	 	(3)	 	(4)
	 
	 	 	 	 	Aggregate	 	 
	 	 	 	 	Principal	 	 
	 	 	Address and	 	Amount of	 	 
	Buyer	 	Facsimile Number	 	Notes Converted	 	Wire Transfer Instructions
	 
	 	 	 	 	 	 
	Kamunting Street Master Fund, Ltd.

	 	140 East 45th Street
	 	$14,500,000	 	Citibank, N.A. New York
	 

	 	15th Floor	 	 	 	ABA # 021000089
	 

	 	New York, NY 10016	 	 	 	Account — Morgan Stanley & Co., NY
	 

	 	Attention:	 	 	 	Account Number 38890774
	 

	 	 
	 	 	 	SUBACCOUNT:
	 

	 	Fax: (212) 490-4360	 	 	 	038-C9190 Kamunting Street Master Fund LTD
	 

	 	Residence	 	 	 	 

 

 

Annex I

     *Omitted. The Company agrees to furnish supplementally a copy of any omitted exhibit, schedule
or similar attachment to the Securities and Exchange Commission upon its request.exv10w2

 

Exhibit 10.2

CONVERSION AGREEMENT

     CONVERSION AGREEMENT (the “Agreement”), dated as of May 16, 2007, by and between Willbros
Group, Inc., a corporation organized under the laws of the Republic of Panama, with headquarters
located at Plaza 2000 Building, 50th Street, 8th Floor, P.O. Box 0816-01098, Panama, Republic of
Panama (the “Company”), and Highbridge International LLC (“Buyer”). Capitalized terms used herein
and not otherwise defined herein shall have the respective meanings set forth in the Purchase
Agreement (as defined below).

WHEREAS:

     A. Pursuant to a Securities Purchase Agreement dated as of December 22, 2005 by and among the
Company, Buyer and certain other buyers party thereto (“Purchase Agreement”), the Company sold to
Buyer the Company’s 6.50% Senior Convertible Notes due 2012 (the “Notes”) convertible into the
Company’s common stock, par value $0.05 per share (the “Common Stock”), at a conversion rate (the
"Conversion Rate”) of 56.9606 shares of Common Stock per $1000 principal amount of the Notes in
accordance with the terms of the Notes and that certain Indenture by and among the Company,
Willbros USA, Inc., a Delaware corporation and wholly-owned Subsidiary of the Company, as guarantor
(“WUSA”), and The Bank of New York, as trustee, dated as of December 23, 2005 (the “Indenture”).

     B. No event has occurred which would result in an adjustment of the Conversion Rate from the
initial Conversion Rate described above.

     C. Contemporaneously with the execution and delivery of the Purchase Agreement, the parties to
the Purchase Agreement executed a Registration Rights Agreement, (the “Registration Rights
Agreement” and collectively with the Indenture, the Notes, the Purchase Agreement and the other
contracts, agreements and deliverables entered into in connection therewith, the “Transaction
Documents”) pursuant to which the Company provided certain registration rights to Buyer with
respect to the resale of the Common Stock into which the Notes may be converted.

     D. Buyer wishes to convert all of the Notes held by Buyer into shares of Common Stock pursuant
to the terms hereof and of the Notes and Indenture (the “Conversion Shares”).

     E. In consideration of such conversions, the Company intends to pay in cash to Buyer $247.50
per $1000 of principal amount of Notes converted pursuant to the terms hereof (the “Conversion
Consideration”).

     NOW, THEREFORE, the Company and Buyer hereby agree as follows:

	 	(1)	 	ISSUANCE OF CONVERSION SHARES; PAYMENT OF ACCRUED INTEREST
AND CONSIDERATION.

     (a) As provided for in the Notes and the Indenture, the Company shall issue the
Conversion Shares to Buyer upon receipt of the Conversion Notice on the Closing Date (as
hereinafter defined).

 

 

     (b) The Company shall, on the Closing Date, pay to Buyer by wire transfer to the
account set forth on Schedule I hereto, the accrued but unpaid interest, if any, on the
Notes being converted pursuant to such Conversion Notice through and including the Closing
Date.

     (c) The Company shall, on the Closing Date, pay to Buyer by wire transfer to the
account set forth on Schedule I hereto the Conversion Consideration.

	 	(2)	 	CONVERSION; CLOSING.

     (a) Procedure. Buyer elects to convert the principal amount of Notes set forth
on Schedule I held by Buyer into shares of Common Stock pursuant to Article 12 of the
Indenture, by delivering the executed notice of conversion to the Company at the Closing in
the form attached to the Note (the “Conversion Notice”). The Company shall effect delivery
of the Conversion Shares to Buyer through the Deposit/Withdrawal at Custodian system of the
Depository Trust Company on the Closing Date. Except as otherwise expressly set forth to
the contrary herein, the conversion shall be effected upon the terms set forth in the Notes
and Indenture (including in respect of rounding and fractional shares). Notwithstanding,
Section 12.14 of the Indenture, all Notes converted pursuant hereto shall be converted into
            shares of Common Stock.

     (b) Closing. The date and time of the closing (the “Closing”) of the
transactions specified in Sections 1 and 2 above (the “Closing Date”) shall be, subject to
the satisfaction (or waiver) of the closing conditions set forth in Sections 5 and 6 hereto)
10:00 a.m., New York City Time, on the Trading Day (as defined in the Indenture) immediately
following the date of the 8-K Filing required by the terms hereof at the offices of Schulte
Roth & Zabel LLP, 919 Third Avenue, New York, New York 10022. At Closing, (i) Buyer shall
deliver to the Company the Conversion Notice setting forth the entire principal amount of
Notes held by Buyer which Buyer has elected to convert pursuant to the terms hereof, and
(ii) the Company shall pay the Conversion Consideration, and all accrued and unpaid
interest, if any, in the amounts set forth in Section 1 hereof.

	 	(3)	 	REGISTRATION RIGHTS.

     (a) Registered Securities. The Company acknowledges and agrees that the
Conversion Shares to be issued pursuant hereto are registered for resale pursuant to an
effective Shelf Registration Statement (as defined in, and required by, the Registration
Rights Agreement).

	 	(4)	 	REPRESENTATIONS, WARRANTIES AND COVENANTS.

     (a) Buyer Representations and Warranties. Buyer hereby represents and warrants
to the Company that:

          i) Buyer was duly organized or formed and is a validly existing organization in
good standing under the laws of its jurisdiction of organization, with power and
authority to execute and deliver this Agreement and

-2-

 

perform its obligations hereunder; and this Agreement and
the transactions contemplated hereby have been duly authorized by Buyer.

               ii) Assuming due authorization, execution and delivery by the Company of this
Agreement, it constitutes a legally valid and binding agreement of Buyer, enforceable
against Buyer in accordance with its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance or transfer, reorganization, moratorium and similar
laws affecting creditors’ rights and remedies generally, and to general principles of
equity, including principles of materiality commercial reasonableness, good faith and
fair dealing (regardless of whether enforcement is sought in a proceeding at law or in
equity). 

     (b) Company Representations and Warranties.

               i) Exchange Act Documents; Financial Statements. The Company’s Annual
Report on Form 10-K for the fiscal year ended December 31, 2006 filed with the SEC on
March 14, 2007 (the “2006 10-K”) and all other documents filed by the Company with the
Securities and Exchange Commission (the “SEC”) pursuant to the Securities Exchange Act
of 1934, as amended, and the rules and regulations of the SEC thereunder (collectively,
the “Exchange Act”) since January 1, 2004 (as amended or supplemented from time to time
prior to the date hereof, including the exhibits thereto, the “Exchange Act Documents”),
when taken together, do not contain an untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. As of their respective filing
dates, except as disclosed in note 2 of the Notes to Consolidated Financial Statements
and under the caption “Overview—Restatement” in Item 7 (Management’s Discussion and
Analysis of Financial Condition and Results of Operations), each included in the
Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2004, filed
with the SEC on November 22, 2005, (x) the financial statements of the Company included
in the Exchange Act Documents complied as to form in all material respects with
applicable accounting requirements and the published rules and regulations of the SEC
with respect thereto and present fairly, in all material respects, the consolidated
financial position of the Company and its consolidated subsidiaries as of the dates
indicated and the results of their operations and the changes in their consolidated cash
flows for the periods specified therein and (y) said financial statements have been
prepared in conformity with generally accepted accounting principles and practices
(“GAAP”) applied on a consistent basis, except as indicated in the notes thereto or, in
the case of unaudited statements, as permitted by Rule 10-01 of Regulation S-X
promulgated by the SEC. No other information provided by or on behalf of the Company to
Buyer in connection with the transactions contemplated hereby which is not included in the
SEC Documents, contains any untrue statement of a material fact or omits to state any
material fact necessary in order to make the statements therein, in the light of the
circumstance under which they are or were made, not misleading.

-3-

 

               ii) Absence of Material Adverse Effect. Since the Company’s 2006 10-K,
there has not been any Material Adverse Change. Since the 2006 10-K, the Company has
not entered into any transaction or agreement that has or would be reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect. As used in this
Agreement, “Material Adverse Change” or “Material Adverse Effect” means any change or
effect that would be materially adverse to the business, properties, condition
(financial or otherwise) or results of operations of the Company and its consolidated
subsidiaries considered as a single enterprise, or to the ability or authority of the
Company to consummate the transactions contemplated hereby on the terms set forth
herein, provided that any reduction in the market price or trading volume of the
Company’s publicly traded common stock shall not, in any event, be deemed to constitute
a Material Adverse Change or a Material Adverse Effect (it being understood that the
foregoing shall not prevent a person from asserting that any underlying cause of such
reduction independently constitutes such a Material Adverse Change or Material Adverse
Effect).

               iii) Solvency. Neither the Company nor any of its Subsidiaries (as
hereinafter defined) has taken any steps to seek protection pursuant to any bankruptcy
law nor does the Company have knowledge that its creditors or its Subsidiaries’
creditors intend to initiate involuntary bankruptcy proceedings or knowledge of any fact
which would reasonably lead a creditor to do so. The Company is not as of the date
hereof, and after giving effect to the transactions contemplated hereby will not be,
Insolvent (as defined below). As used in this Agreement, “Insolvent” means (i) the
present fair saleable value of the Company’s assets is less than the amount required to
pay the Company’s known liabilities and identified contingent liabilities, (ii) the
Company is unable to pay its debts and liabilities, subordinated, contingent or
otherwise, as such debts and liabilities become absolute and matured or (iii) the
Company has unreasonably small capital with which to conduct the business in which it is
engaged as such business is now conducted.

               iv) Organization and Qualification. The Company has been duly incorporated
and is validly existing as a corporation in good standing under the laws of the Republic
of Panama, with corporate power and authority to own or lease its properties and conduct
its business as described in the Exchange Act Documents, and has been duly qualified as
a foreign corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties, or conducts its
business in a manner or to an extent that would require such qualification, other than
such failures to be so qualified or in good standing as, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.

               v) Subsidiaries. Each Subsidiary of the Company has been duly organized
and is validly existing as a corporation, partnership or limited liability company in
good standing under the laws of the jurisdiction in which it is chartered or organized
with full power and authority to own or lease, as the case may be, and to operate its
properties and conduct its business as currently operated and conducted, and is duly
qualified to do business as a foreign corporation, partnership or limited

-4-

 

liability company and is in good standing under the laws of each jurisdiction which requires such
qualification, except where the failure so to qualify or to be in good standing would
not, individually or in the aggregate, result in a Material Adverse Effect; all the
issued and outstanding shares of capital stock of or other ownership interests in each
such Subsidiary have been duly authorized and validly issued and, with respect to each
such Subsidiary which is a corporation, are fully paid and non-assessable. As used in
this Agreement, “Subsidiary” means any entity of which the Company (either alone or
through or together with one or more of its Subsidiaries) owns or holds, directly or
indirectly, through one or more intermediaries, more than 50% of the stock or other
equity interests of such entity, (B) any entity of which stock or other equity interests
having the power to elect a majority of that entity’s board of directors or similar
governing body, or otherwise having the power to direct the business and policies of
such entity, are held or owned, directly or indirectly, through one or more
intermediaries, by the Company (either alone or through or together with one or more of
its Subsidiaries), or (C) any entity , the operations of which are consolidated or
combined with the Company, pursuant to GAAP, for financial reporting purposes.

               vi) Authorization; Enforcement; Validity. The Company has the requisite
power and authority to enter into and perform its obligations under this Agreement and
to issue the Conversion Shares in accordance with the terms hereof. The execution and
delivery of the Agreement by the Company and the consummation by the Company of the
transactions contemplated hereby, including, without limitation, the issuance of the
Conversion Shares and the payment of Conversion Consideration, accrued interest, if any,
have been duly authorized by the Company’s Board of Directors and no further filing,
consent, or authorization is required by the Company, its Board of Directors or its
stockholders, except for the filing of the 8-K Filing contemplated by Section 4(c)
hereunder. This Agreement has been duly executed and delivered by the Company, and
constitutes the legal, valid and binding obligations of the Company, enforceable against
the Company in accordance with its terms, except as such enforceability may be limited
by general principles of equity or applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation or similar laws relating to, or affecting generally, the
enforcement of applicable creditors’ rights and remedies, and except that rights to
indemnification and contribution hereunder may be limited by federal or state securities
laws or public policy relating thereto.

               vii) Issuance of Securities. The issuance of the Conversion Shares is duly
authorized and such shares are free from all taxes, liens and charges with respect to
the issuance hereof. The offer and issuance by the Company of the Conversion Shares and
the payment of the Conversion Consideration in conformity with the terms of this Agreement
constitute transactions exempt from registration under the Securities Act of 1933, as
amended (the “Securities Act”).

               viii) No Conflicts. The execution, delivery and performance of the
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby (including, without limitation, the issuance of the Conversion
Shares) will not (i) result in a breach of any of the terms or provisions of,

-5-

 

constitute
a default (with or without the giving of notice or the passage of time or otherwise)
under, or result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company is a party or by
which the Company is bound or to which any of the property or assets of the Company is
subject except, in each case, for such conflicts, breaches, defaults, liens, charges or
encumbrances which would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect, (ii) result in any violation of the provisions of the
Amended and Restated Certificate of Incorporation, as amended, or the Restated Bylaws of
the Company, each as in effect on the date hereof, (iii) result in any violation of any
material applicable law or statute or any order, rule or regulation of any court or
governmental agency or of any self-regulatory agency or body having jurisdiction over
the Company or any of its properties or (iv) result in a violation of any of the rules
and regulations of the New York Stock Exchange (the “Principal Market”) applicable to
the Company or by which any property or asset of the Company or any of its Subsidiaries
is bound or affected.

               ix) Consents. The Company is not required to obtain any consent, approval,
authorization, order, license, registration or qualification of, or make any filing or
registration with, any court, governmental agency or any regulatory or self-regulatory
agency or body or any other Person in order for it to execute, deliver or perform any of
its obligations under or contemplated by the Agreement, in each case in accordance with
the terms hereof, except for the 8-K Filing and post closing securities filings or
notifications to be made under federal or state securities laws. All consents,
authorizations, orders, filings and registrations which the Company is required to
obtain pursuant to the preceding sentence have been or will be obtained or effected on
or prior to the Closing Date. The Company and its Subsidiaries are unaware of any facts
or circumstances which might prevent the Company from obtaining or effecting any of the
registration, application or filings pursuant to the preceding sentence. The Company is
not in violation of the applicable listing requirements of the Principal Market and has
no knowledge of any facts which would reasonably lead to delisting or suspension of the
Common Stock. The issuance by the Company of the Conversion Shares shall not have the
effect of delisting or suspending the Common Stock from the Principal Market.

               x) Absence of Litigation. Except as described in Item 3, “Legal
Proceedings” of the 2006 10-K and the Notes to Consolidated Financial Statements
thereto, there are no legal or governmental investigations, actions, suits or
proceedings pending or, to the Company’s knowledge, threatened against or affecting
the Company, its Subsidiaries or any of its properties or to which the Company or
its Subsidiaries is or may be a party or to which any property of the Company is or may
be the subject that, if determined adversely to the Company, would, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect.

-6-

 

               xi) Conversion Rate. No event has occurred which would result in an
adjustment of the Conversion Rate from the initial Conversion Rate described in Recital
A.

          (c) Disclosure of Transactions and Other Material Information. The Company
shall file a current report on Form 8-K (the “8-K Filing”) on or before 8:30 a.m., New York
City time, on May 17, 2007, in the form required by the Exchange Act, relating to the
transactions contemplated by this Agreement and attaching this Agreement or a form hereof
(including, without limitation, all schedules and exhibits to this Agreement) as an exhibit
to such filing. At the time of the 8-K Filing, the Company shall not have provided Buyer
with any material, nonpublic information that is not disclosed in the 8-K Filing.

          (d) Material Non-Public Information. Other than as set forth in the 8-K
Filing, the Company covenants and agrees that neither it nor any other person or entity
acting on its behalf has provided or will provide Buyer or its agents or counsel with any
information that constitutes material non-public information, unless prior thereto Buyer
shall have executed a written agreement regarding the confidentiality and use of such
information. The Company understands and confirms that Buyer shall be relying on the
foregoing representations in effecting transactions in securities of the Company.

          (e) Publication. In the event of a breach of the foregoing covenant by the
Company or any of its Subsidiaries, or any of its or their respective officers, directors,
employees and agents, in addition to any other remedy provided herein, Buyer shall have the
right to make a public disclosure, in the form of a press release, public advertisement or
otherwise, of such material, nonpublic information without the prior approval by the
Company, its Subsidiaries, or any of its or their respective officers, directors, employees
or agents. Buyer shall have no liability to the Company, its Subsidiaries, or any of its or
their respective officers, directors, employees, stockholders or agents, for any such
disclosure. Subject to the foregoing, neither the Company, its Subsidiaries nor Buyer shall
issue any press releases or any other public statements with respect to the transactions
contemplated hereby; provided, however, that the Company shall be entitled, without the
prior approval of Buyer, to make any press release or other public disclosure with respect
to such transactions (i) in substantial conformity with the 8-K Filing and contemporaneously
therewith and (ii) as is required by applicable law and regulations (provided that in the
case of clause (i) Buyer shall be consulted by the Company in connection with any such press
release or other public disclosure prior to its release).

          (f) Holding Period. For the purposes of Rule 144, the Company acknowledges
that, under current SEC interpretations of the holding period requirement included in Rule
144, the holding period of the corresponding Conversion Shares may be tacked onto the
holding period of the Notes, and the Company agrees not to take a
position contrary to this Section 4(f). The Company’s representation, covenant and
agreement set forth in this Section 4(f) shall be subject in all respects to Rule 144 and
other applicable securities laws, and contrary interpretations thereof as may be in effect
from time to time subsequent to the date of this Agreement.

-7-

 

          (g) Offer to Other Holders. The Company has not and will not offer to any
holder of Notes (other than Buyer) (each, an “Other Holder”) terms more favorable to such
holder than those of the Buyer and this Agreement. After the date hereof, the Company shall
not enter into any conversion agreement with an Other Holder of Notes until the date three
Business Days (as defined in the Indenture) after the date hereof. The Company agrees that
if it enters into any agreement with any Other Holder prior to the twelve (12) month
anniversary of the Closing on terms more favorable to such holder than those of Buyer and
this Agreement, then without any further action by Buyer or the Company, this Agreement
shall be deemed amended and modified in an economically and legally equivalent manner such
that Buyer shall receive the benefit of the more favorable terms contained in such agreement
and the Company will at its expense, take such other actions (such as entering into
amendments to this Agreement) as Buyer may reasonably request to further effectuate the
foregoing. Notwithstanding the foregoing, Buyer acknowledges and agrees that the Conversion
Consideration is based on the pricing grid attached hereto as Annex I (the “Pricing Grid”)
and, accordingly, any modification of the Conversion Consideration which the Company may
agree to pay to an Other Holder which is based on the Pricing Grid shall not be deemed to be
a term more favorable to such holder than the Conversion Consideration paid to the Buyer
under this Agreement.

          (5) CONDITIONS TO COMPANY’S OBLIGATIONS HEREUNDER.

     The obligations of the Company to Buyer hereunder are subject to the satisfaction of each of
the following conditions, provided that these conditions are for the Company’s sole benefit and may
be waived by the Company at any time in its sole discretion by providing Buyer with prior written
notice thereof:

                    (a) Buyer shall have executed this Agreement and delivered the same to the Company.

                    (b) Buyer shall have delivered to the Company a Conversion Notice.

                    (c) The representations and warranties of Buyer shall be true and correct in all
material respects (except for those representations and warranties that are qualified by
materiality or Material Adverse Effect, which shall be true and correct in all respects) as
of the date when made and as of the Closing Date as though made at that time (except for
representations and warranties that speak as of a specific date).

          (6) CONDITIONS TO BUYER’S OBLIGATIONS HEREUNDER.

     The obligations of Buyer hereunder are subject to the satisfaction of each of the following
conditions, provided that these conditions are for Buyer’s sole benefit and may
be waived by Buyer in respect of itself at any time in its sole discretion by providing the
Company with prior written notice thereof:

                    (a) The Company shall have executed this Agreement and delivered the same to Buyer.

-8-

 

                    (b) The Conversion Shares shall continue to be registered for resale pursuant to an
effective Shelf Registration Statement.

                    (c) The Company shall have delivered to Buyer, Buyer’s Conversion Consideration, and
all accrued and unpaid interest, if any, in respect of the Notes being converted by Buyer
pursuant to the terms hereof.

                    (d) The representations and warranties of the Company under this Agreement shall be
true and correct in all material respects (except for those representations and warranties
that are qualified by materiality or Material Adverse Effect, which shall be true and
correct in all respects) as of the date when made and as of the Closing Date as though made
at that time (except for representations and warranties that speak as of a specific date)
and the Company shall have performed, satisfied and complied in all material respects with
the covenants, agreements and conditions required by this Agreement to be performed,
satisfied or complied with by the Company at or prior to the Closing Date and no Default or
Event of Default (each as defined in the Indenture) shall have occurred and be continuing on
the date hereof either immediately before or after giving effect to this Agreement in
accordance with its terms.

                    (e) The Common Stock (I) shall be designated for quotation or listed on the Principal
Market and (II) shall not have been suspended, as of the Closing Date, by the SEC or the
Principal Market from trading on the Principal Market nor shall suspension by the SEC or the
Principal Market have been threatened, as of the Closing Date, either (A) in writing by the
SEC or the Principal Market or (B) by falling below the minimum listing maintenance
requirements of the Principal Market.

          (7) INDEMNIFICATION BY THE COMPANY.

                    (a) In consideration of Buyer’s obligations hereunder and the execution and delivery of
this Agreement, the Conversion Notices on the Closing Date and in addition to all of the
Company’s other obligations under this Agreement, the Company shall defend, protect,
indemnify and hold harmless Buyer and all of its and its investment managers’ stockholders,
partners, members, officers, directors, employees and direct or indirect investors and any
of the foregoing persons’ agents or other representatives (collectively, the “Buyer
Indemnitees”) from and against any losses, claims, damages, liabilities, judgments, fines,
penalties, charges, costs, reasonable attorneys’ fees, amounts paid in settlement or
expenses, joint or several, (collectively, “Buyer Claims”) incurred in investigating,
preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal
taken from the foregoing by or before any court or governmental, administrative or other
regulatory agency, body or the SEC, whether pending or threatened, whether or not the
Company is or may be a party thereto (“Buyer Indemnified Damages”), incurred by any Buyer Indemnitee as a result of, or
arising out of (i) any misrepresentation or breach of any representation or warranty made by
the Company in this Agreement or (ii) any breach of any covenant, agreement or obligation of
the Company contained in this Agreement. To the extent that the foregoing undertaking by
the Company may be unenforceable for any reason, the Company shall

-9-

 

make the maximum contribution to the payment and satisfaction of each of the Buyer Indemnified Damages which
is permissible under applicable law.

                    (b) This indemnity shall not apply to amounts paid in settlement of any claim if such
settlement is effected without the prior written consent of the Company, which consent shall
not be unreasonably withheld or delayed. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of the Buyer Indemnitee and
shall survive the issuance of the Conversion Shares pursuant hereto.

                    (c) Promptly after receipt by a Buyer Indemnitee under this Section 7 of notice of the
commencement of any action or proceeding (including any governmental action or proceeding)
involving a Buyer Claim, such Buyer Indemnitee shall, if a Buyer Claim in respect thereof is
to be made against the Company under this Section 7, deliver to the Company a written notice
of the commencement thereof, and the Company shall have the right to participate in, and, to
the extent the Company so desires, to assume control of the defense thereof with counsel
mutually satisfactory to the Company and the Buyer Indemnitee; provided, however, that a
Buyer Indemnitee shall have the right to retain its own counsel with the fees and expenses
of not more than one counsel for such Buyer Indemnitee to be paid by the Company, if, in the
reasonable opinion of the Buyer Indemnitee, the representation by such counsel of the Buyer
Indemnitee and the Company would be inappropriate due to actual or potential differing
interests between such Buyer Indemnitee and any other party represented by such counsel in
such proceeding. In no event shall the Company be liable for the fees and expenses of more
than one counsel separate from its own counsel for all Buyer Indemnitees in connection with
any one action or separate but similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances.

                    (d) The Buyer Indemnitee shall cooperate with the Company in connection with any
negotiation or defense of any such action or Buyer Claim by the Company and shall furnish to
the Company such information as may be reasonably available to the Buyer Indemnitee which
relates to such action or Buyer Claim. The Company shall keep the Buyer Indemnitee
reasonably apprised at all times as to the status of the defense or any settlement
negotiations with respect thereto. The Company shall not be liable for any settlement of
any action, claim or proceeding effected without its prior written consent; provided,
however, that the Company shall not unreasonably withhold, delay or condition its consent.
The Company shall not, without the prior written consent of the Buyer Indemnitee, consent to
entry of any judgment or enter into any settlement or other compromise which does not
include as an unconditional term thereof the giving by the claimant or plaintiff to such
Indemnitee of a release from all liability in respect to such Buyer Claim or litigation.
Following indemnification as provided for hereunder, the Company shall be subrogated to all
rights of the Buyer Indemnitee with respect to all third parties, firms or corporations relating to the
matter for which indemnification has been made. The failure to deliver written notice to
the Company within a reasonable time of the commencement of any such action shall not
relieve the Company of any liability to the Buyer Indemnitee under this Section 7, except

-10-

 

to the extent that the Company is materially prejudiced in its ability to defend such action.

                    (e) The indemnification required by this Section 7 shall be made by periodic payments
of the amount thereof during the course of the investigation or defense, as and when bills
are received or expenses are incurred upon delivery to the Company of reasonable
documentation therefor setting forth such expenses in reasonable detail. Notwithstanding
anything to the contrary set forth herein, no Buyer Indemnitee shall be entitled to be
indemnified pursuant to this Section 7 for any Buyer Claim to the extent such claim arises
as a result of the Buyer Indemnitee’s gross negligence or willful misconduct; provided,
however, that the Company shall pay the expenses incurred by any such Buyer Indemnitee
hereunder, as such expenses are incurred, in connection with any proceeding in advance of
the final disposition, so long as the Company receives an undertaking by such Buyer
Indemnitee to repay such portion of the amounts attributable, based on a final
non-appealable determination, to such Buyer Indemnitee’s gross negligence or willful
misconduct; and provided, further, that the termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that such Buyer Indemnitee was either grossly
negligent or engaged in willful misconduct.

                    (f) Payments made by the Company under this Section 7 shall be limited to the amount of
any liability or damage that remains after deducting therefrom any insurance proceeds and
any indemnity, contribution or other similar payment recovered by the Buyer Indemnitee from
any third party with respect thereto.

          (8) TERMINATION.

     In the event that the Closing does not occur by May 25, 2007, due to the Company’s or Buyer’s
failure to satisfy the conditions set forth in Sections 5 and 6 hereof (and the nonbreaching
party’s failure to waive such unsatisfied conditions(s)), the nonbreaching party shall have the
option to terminate this Agreement with respect to such breaching party at the close of business on
such date without liability of any party to any other party. Upon such termination, the terms
hereof shall be null and void and the parties shall continue to comply with all terms and
conditions of the Transaction Documents, as in effect prior to the execution of this Agreement.

          (9) MISCELLANEOUS.

               (a) Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the internal laws of
the State of New York, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of New York or any other
jurisdictions) that would cause the application of the laws of any jurisdictions other
than the State of New York.

               (b) Counterparts. This Agreement may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and

-11-

 

shall become effective when counterparts have been signed by each party and delivered to the other party;
provided that a facsimile signature shall be considered due execution and shall be binding
upon the signatory thereto with the same force and effect as if the signature were an
original, not a facsimile signature.

               (c) Headings. The headings of this Agreement are for convenience of reference
and shall not form part of, or affect the interpretation of, this Agreement.

               (d) Severability. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Agreement in that jurisdiction or the
validity or enforceability of any provision of this Agreement in any other jurisdiction.

               (e) Entire Agreement; Amendments. This Agreement shall supersede all other
prior oral or written agreements among Buyer, the Company, their affiliates and persons
acting on their behalf with respect to the matters discussed herein and therein, and this
Agreement, and the instruments referenced herein contain the entire understanding of the
parties with respect to the matters covered herein and therein. No provision of this
Agreement may be amended other than by an instrument in writing signed by the Company and
Buyer, and any amendment to this Agreement made in conformity with the provisions of this
Section 9(f) shall be binding on Buyer and the Company. No provision hereof may be waived
other than by an instrument in writing signed by the party against whom enforcement is
sought.

               (f) Notices. Any notices, consents, waivers or other communications required
or permitted to be given under the terms of this Agreement must be in writing and will be
deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is mechanically or
electronically generated and kept on file by the sending party); or (iii) one Business Day
after deposit with an overnight courier service, in each case properly addressed to the
party to receive the same. The addresses and facsimile numbers for such communications
shall be:

If to the Company:

Willbros Group, Inc.

c/o Willbros USA, Inc.

4400 Post Oak Parkway, Suite 1000

Houston, Texas 77027

Telephone: (713) 403-8092

Facsimile: (713) 403-8136

Attention: General Counsel

with a copy (for informational purposes only) to:

Conner & Winters, LLP

4000 One Williams Center

Tulsa, Oklahoma 74172

Telephone: (918) 586-8961

Facsimile: (918) 586-8661

Attention: Mark D. Berman, Esq.

-12-

 

If to Buyer, to its address and facsimile number set forth on Schedule 1 hereto, or to such
other address and/or facsimile number and/or to the attention of such other Person as the
recipient party has specified by written notice given to each other party five (5) days
prior to the effectiveness of such change.

Written confirmation of receipt (A) given by the recipient of such notice, consent, waiver
or other communication, (B) mechanically or electronically generated by the sender’s
facsimile machine containing the time, date, recipient facsimile number and an image of the
first page of such transmission or (C) provided by an overnight courier service shall be
rebuttable evidence of personal service, receipt by facsimile or receipt from an overnight
courier service in accordance with clause (i), (ii) or (iii) above, respectively.

               (g) Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their respective successors and assigns, including any
purchasers of the Notes.

               (h) No Third Party Beneficiaries. This Agreement is intended for the benefit
of the parties hereto and their respective permitted successors and assigns, and is not for
the benefit of, nor may any provision hereof be enforced by, any other Person.

               (i) Further Assurances. Each party shall do and perform, or cause to be done
and performed, all such further acts and things, and shall execute and deliver all such
other agreements, certificates, instruments and documents, as any other party may reasonably
request in order to carry out the intent and accomplish the purposes of this Agreement and
the consummation of the transactions contemplated hereby.

               (j) No Strict Construction. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no rules of
strict construction will be applied against any party.

               (k) Independent Nature of Buyer’s Obligations and Rights. Nothing contained
herein, and no action taken by Buyer pursuant hereto or in connection herewith, shall be
deemed to constitute Buyer and any other holder of the Notes as a partnership, an
association, a joint venture or any other kind of entity, or create a presumption that Buyer
is in any way acting in concert or as a group with any other holder of the Notes with
respect to such obligations. Buyer confirms that it has independently participated in the
negotiation of the transaction contemplated hereby with the advice of its own counsel and
advisors.

[Signature Page Follows]

-13-

 

     IN WITNESS WHEREOF, Buyer and the Company have caused their respective signature page to this
Conversion Agreement to be duly executed as of the date first written above.

	 	 	 	 	 
	 	COMPANY:

WILLBROS GROUP, INC.

 

 	 
	 	By:  	/s/ Van A. Welch
 	 
	 	 	Name:  	Van A. Welch 	 
	 	 	Title:  	Senior Vice President,
Chief
Financial Officer and Treasurer 	 
	 

 

 

     IN WITNESS WHEREOF, Buyer and the Company have caused their respective signature page to this
Conversion Agreement to be duly executed as of the date first written above.

	 	 	 	 	 
	 	BUYER:

HIGHBRIDGE INTERNATIONAL LLC

 

 	 
	 	By:  	/s/ Scott M. Wallace
 	 
	 	 	Name:  	Scott M. Wallace 	 
	 	 	Title:  	Senior Vice President 	 
	 

 

 

SCHEDULE 1

	 	 	 	 	 	 	 	 	 
	(1)	 	(2)	 	(3)	 	(4)
	 	 	 	 	Aggregate	 	 
	 	 	 	 	Principal	 	 
	 	 	Address and	 	Amount of	 	 
	Buyer	 	Facsimile Number	 	Notes Converted	 	Wire Transfer Instructions
	 

	Highbridge International LLC

	 	c/o Highbridge Capital Management, LLC
	 	$	21,750,000	 	 	Citibank, N.A.
	 

	 	9 West 57th Street, 27th Floor
	 	 	 	 	 	ABA#: 021000089
	 

	 	New York, New York 10019
	 	 	 	 	 	A/C: Bear Stearns Securities Corp
	 

	 	Attention: Ari J. Storch
	 	 	 	 	 	A/C#: 09253186
	 

	 	          Adam J. Chill
	 	 	 	 	 	FBO: Highbridge International LLC
	 

	 	Facsimile: (212) 751-0755
	 	 	 	 	 	A/C#: 102-07954
	 

	 	Telephone: (212) 287-4720	 	 	 	 	 	 

 

 

Annex I

     *Omitted. The Company agrees to furnish supplementally a copy of any omitted exhibit, schedule
or similar attachment to the Securities and Exchange Commission upon its request.

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