Document:

Exhibit 10.1

Exhibit 10.1

CONTRACT OF SALE

This CONTRACT OF SALE (this “Contract”) is made by and between SSAE Development, LLC,
(“Seller”) and Peerless Mfg. Co. (“Purchaser”).

W I T N E S S E T H:

In consideration of the mutual covenants, representations, warranties, agreements, and
provisions herein contained, the parties hereto hereby agree as follows:

1. Agreement to Sell and Purchase. Subject to the terms and conditions hereinafter set forth,
Seller hereby agrees to sell and convey to Purchaser, and Purchaser hereby agrees to purchase from
Seller, all of the following described property: (i) that certain tract of land (the
“Land”), consisting of 32.929 acres more or less, situated in the City of Denton, Denton
County, Texas, as more particularly described in Exhibit A attached hereto and made a part
hereof for all purposes; (ii) any and all interests of Seller in any land lying in or under the bed
of any street, alley, road or right-of-way, opened or proposed, abutting or adjacent to the Land;
(iii) any and all leases, rights, privileges, and appurtenances belonging or pertaining to the
Land; (iv) any and all improvements, structures, and fixtures located on, over, and under the Land
(including without limitation any real property improvements owned by Seller and located in, on or
under the Land or related to, used or available for use in the ownership, conduct, operation or
maintenance of the Property (hereinafter defined); (v) any and all easements or rights-of-way
affecting the Land and any of rights to use the same; (vi) any and all rights of ingress and egress
to and from the Land and any of Seller’s rights to use the same; (vii) all air rights, water
rights, claims, and permits relating to the Land; (viii) any and all interests of Grantor in any
and all roads (open or proposed) affecting, crossing, fronting, or bounding the Land, including any
awards made or to be made relating thereto including, without limitation, any unpaid awards or
damages payable by reason of damages thereto or by reason of a widening of or changing of the grade
with respect to the same; (ix) reversionary interests in and to the Land, and (x) site plans,
surveys, soil and substrata studies, engineering plans and studies, and other plans or studies of
any kind that relate to the Property in the possession of or under the control of Seller (the Land,
together with any and all of the related improvements, rights, privileges, appurtenances, and
interests referenced in items (i) through (x) above, are herein referred to as the
“Property”).

2. Purchase Price. The purchase price for the Property (the “Purchase Price”) shall
be the sum of $1,813,596.41. The Purchase Price shall be paid as follows: (a) the sum of
$946,514.41 shall be paid to Seller in cash at Closing, plus or minus, any prorations and other
adjustments to the Purchase Price contemplated by this Contract (the “Cash Portion”; and
(b) the sum of $867,082.00 (the “Escrow Portion”) will be delivered to the “Escrow Agent”
(as such term is defined in the Development and Escrow Agreement) to be held and distributed in
accordance with the terms and conditions set forth in the Development and Escrow Agreement to be
executed by the Parties at Closing, in the form attached hereto as Exhibit B and
incorporated herein by reference Development and Escrow Agreement (the “Development and Escrow
Agreement”).

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3. Escrow Deposit. For the purpose of securing the performance of Purchaser under the terms
and provisions of this Contract, Purchaser agrees to deliver to the Title Company (hereinafter
defined), within three (3) days after the Effective Date, as an earnest money deposit the sum of
One Hundred Thousand and 00/100 Dollars ($100,000.00). The Title Company shall deposit the funds
in an interest bearing account approved by Purchaser, with the interest earned thereon belonging to
Purchaser (the earnest money deposit, together with all interest earned thereon is hereinafter
called the “Escrow Deposit”). If the sale of the Property contemplated herein is
consummated in accordance with the terms hereof, the Escrow Deposit shall be applied to the
Purchase Price at the Closing. If the sale hereunder is not consummated in accordance with the
terms hereof, the Escrow Deposit shall be disbursed by the Title Company as hereinafter provided.

4. Independent Contract Consideration. Within three (3) days after the Effective Date,
Purchaser agrees to deliver to Seller a check in the amount of One Hundred and 00/100 Dollars
($100.00) (“Independent Contract Consideration”), which amount the parties bargained for
and agreed to as consideration for Purchaser’s right of inspection as hereinafter provided. This
Independent Contract Consideration is in addition to and independent of any other consideration or
payment provided in this Contract, is nonrefundable, and shall be retained by Seller
notwithstanding any other provision of this Contract.

5. Conditions Precedent to Consummation by Purchaser. The obligation of Purchaser to
consummate this Contract shall, at the option of Purchaser, be subject to the following conditions
precedent:

(a) Title Commitment. Within ten (10) days after the filing of the Final Plat,
Seller, at Seller’s sole cost and expense, shall cause to be delivered to Purchaser a current
owner’s title policy commitment (the “Commitment”) covering the Property, issued by
Republic Title of Texas, Inc., 420 Throckmorton, Suite 640, Fort Worth, Texas 76102 (the “Title
Company”), binding the Title Company to issue the Policy (hereinafter defined) to Purchaser in
the amount of the Purchase Price, and accompanied by copies of all recorded documents relating to
liens, restrictions, easements, rights-of-way, and other matters affecting the Property (the
“Title Documents”). Purchaser shall give Seller written notice on or before the expiration
of fifteen (15) days after it receives the last of the filed Final Plat, the Commitment, the Title
Documents, and the Survey (hereinafter defined) (or any amendments, modifications or supplements to
the filed Final Plat, the Commitment, the Title Documents, or the Survey that reflect matters,
defects, conditions or exceptions not previously set forth in a prior version of the filed Final
Plat, the Commitment, the Title Documents, and the Survey) that the condition of title as set forth
in the Commitment is or is not satisfactory, and in the event Purchaser states that the condition
is not satisfactory, Seller may promptly undertake to eliminate or modify all such unacceptable
matters to the reasonable satisfaction of Purchaser. In the event Seller is unable or unwilling to
do so within ten (10) days after receipt of such written notice, Purchaser may, at its option, in
addition to any other remedies, terminate this Contract by delivering written notice of termination
to Seller within five (5) days after the expiration of the aforementioned ten (10) day period and
receive a return of the Escrow Deposit without the necessity of any additional authorization,
instructions or releases from either Seller or Purchaser, it being the express intention of

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 Seller
and Purchaser that this provision be self-operative. If such notice is not given
by Purchaser to Seller within such fifteen (15) day period, the condition of title and title
exceptions as shown in the Commitment shall be deemed to be acceptable (the “Permitted
Exceptions”). Notwithstanding the foregoing, Purchaser shall not be required to make any
objection to, and Seller shall be obligated to cure and/or satisfy to the reasonable satisfaction
of Purchaser, all matters shown on Schedule C to the Commitment, including, without limitation, any
mortgage liens, mechanics and materialman’s liens not caused by the acts or omissions of Purchaser
or its agents against the Property, any other liens against the Property that are in a liquidated
amount and readily dischargeable, and any consensual liens or encumbrances agreed to by Seller
without Purchaser’s consent on or after the Effective Date, all of which matters are hereby deemed
to be unacceptable and which Seller shall be required to have satisfied at or prior to the Closing.

(b) Survey. Within ten (10) days after the filing of the Final Plat, Seller, at
Seller’s sole cost and expense, shall cause to be delivered to Purchaser a current survey (the
“Survey”) of the Property, prepared by a duly licensed Texas land surveyor acceptable to
Purchaser and the Title Company. The Survey shall be staked on the ground, shall show the location
of all improvements, highways, streets, roads, driveways, parking areas, railroads, rivers, creeks,
or other water courses, fences, easements, right-of-way, and curb cuts on or adjacent to the
Property and shall set forth the number of total acres and square feet comprising the Property,
together with a metes and bounds description thereof. The beginning point of the metes and bounds
description should be established by a monument or by reference to a nearby monument, and such
description should refer to all streets, alleys, and other rights-of-way that abut the Property and
recite the width thereof. The Survey should show the horizontal lengths of all sides of all
structures and the relation of such structures by distances to all boundary lines, encumbering
easements, building lines, and street lines. The Survey shall be in such form as to permit the
modification of the boundary and survey exception to “shortages in area,” at Buyer’s expense, in
the owner’s policy of title insurance to be delivered to Purchaser at the Closing. The Survey
shall contain the surveyor’s certification addressed to Purchaser and the Title Company in
substantially the same form attached hereto as Exhibit C. Purchaser shall give Seller
written notice on or before the expiration of fifteen (15) days after it receives the last of the
filed Final Plat, the Survey, the Commitment and the Title Documents (or any amendments,
modifications or supplements to the filed Final Plat, the Commitment, the Title Documents, or the
Survey that reflect matters, defects, conditions or exceptions not previously set forth in a prior
version of the filed Final Plat, the Commitment, the Title Documents, and the Survey) of any
objection to the Survey. Seller may promptly undertake to eliminate or modify all such
unacceptable matters to the reasonable satisfaction of Purchaser. In the event Seller is unable or
unwilling to do so within ten (10) days after receipt of such written notice, Purchaser may, at its
option, terminate this Contract by delivering written notice of termination to Seller within five
(5) days after the expiration of the aforementioned ten (10) day period. If such notice is not
given by Purchaser to Seller, the Survey shall be deemed to be acceptable.

(c) Final Plat. Within fourteen (14) days of the Effective Date, Seller will file the
Final Plat attached hereto as Exhibit E (the “Final Plat”) in the Plat Records of
Denton County, Texas without revision from its current form. Purchaser will not revise the Final
Plat without Purchaser’s prior written approval.

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(d) Inspection. Purchaser shall have from the effective date of this Contract until
the Closing Date (the “Pre-Closing Period”) to inspect and conduct such tests and
feasibility studies of the Property as Purchaser deems advisable, to meet with governmental
entities regarding the Property, and to review any other matter Purchaser deems necessary or
advisable. During the Pre-Closing Period, Seller shall make available to Purchaser or its agents
for review and coping all records in the possession of Seller or its agents pertaining to the
Property, including, without limitation, all tax records, income and expense accounting records,
all records pertaining to the operation and management of the Property, all plans, surveys, soil
and substrata studies, engineering plans and studies, schematics of the Land and any improvements
thereon, and all environmental reports pertaining to the Land. Entry on the Property shall only be
at the permission of Seller, which shall not be unreasonably withheld, and on at least 24 hours
written notice. Purchaser understands that Seller currently has the Property under contract to
purchase and that permission to enter the Property may be impossible to obtain or to obtain on less
than 24 hours written notice. If Purchaser, in its sole discretion, is not satisfied with such
inspection and review of the Property, Purchaser may terminate this Contract by sending written
notice to Seller and the Title Company in writing (“Purchaser’s Termination Notice”) at any
time on or before the thirtieth (30th) day immediately following the date of Purchaser’s receipt of
the last of the filed Final Plat, the Commitment, the Survey and the Title Documents (the
“Inspection Period”); and, in such event, this Contract shall automatically become null and
void, whereupon neither party shall have any further rights or obligations to the other and the
entire Escrow Deposit shall be promptly returned by the Title Company to Purchaser, without the
necessity of any additional authorization, instructions or releases from either Seller or
Purchaser, it being the express intention of Seller and Purchaser that this provision be
self-operative. If Purchaser does not deliver Purchaser’s Termination Notice to Seller and the
Title Company prior to the end of the Inspection Period, then Purchaser shall forfeit its right to
terminate this Contract pursuant to the provisions of this Section 5(c).

(e) Representations. All of the covenants, representations, warranties, and
agreements by Seller set forth in this Contract shall be true and correct as of the date hereof and
as of the Date of Closing.

(f) Performance. Seller shall, on or prior to the Date of Closing, have performed,
met, or complied with all of the terms, provisions, covenants, conditions, and agreements on its
part required by the terms of this Contract.

(g) Intervening Law or Regulation. If any law, statute, ordinance, ruling, or other
governmental regulation of any duly constituted authority having jurisdiction in effect at the Date
of Closing shall impair the right of Purchaser to acquire the Property and/or to lease all or part
of the same, Purchaser shall have the option to terminate this Contract in its entirety.

(h) Eminent Domain. If prior to the Date of Closing, all or any portion of the
Property is condemned or taken by eminent domain, Seller shall promptly give Purchaser notice of
such condemnation or taking. In such event, Purchaser shall have the option to terminate this
Contract and receive a return of the Escrow Deposit without the necessity of any additional
authorization, instructions or releases from either Seller or Purchaser, it being the express
intention of Seller and Purchaser that this provision be self-operative. If Purchaser does not
elect
to terminate this Contract, Seller shall convey the Property on the Date of Closing to Purchaser
and assign to Purchaser all of Seller’s right, title and interest in any claims Seller may have to
the condemnation awards and pay to Purchaser all payments previously made to Seller by such
condemning authorities.

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6. Warranties, Representations, and Covenants of Seller. For the purpose of inducing
Purchaser to purchase the Property, Seller warrants, represents and covenants to Purchaser as of
the date hereof (except as expressly provided otherwise below) and as of the Date of Closing:

(a) Title. As of the date of Closing, Seller shall have good and marketable title in
fee simple to the Property, free and clear of all liens, claims and encumbrances whatsoever except
those exceptions shown in the Commitment to be furnished to Purchaser. Seller further covenants
that immediately preceding the Closing it will be vested with fee simple title to the Property
subject only to those exceptions shown in the Commitment, and that except for such items, any and
all liens, encumbrances, claims, charges, or leases that would impair the conveyance of superior
title to Purchaser will have been extinguished, amended, or modified in a manner satisfactory to
Purchaser and its counsel for assuring the conveyance of superior title. Purchaser understands
that Seller does not, and will not, own the rights to oil, gas and other mineral rights to the
Property and Purchaser is not acquiring any such rights by virtue of this Contract; provided,
however, Purchaser warrants and represents that the owners of the mineral rights have waived any
and all rights with respect to the use of the surface of the Property. Purchaser further
understands and acknowledges that Seller is not currently the owner of the Property, that Seller
has contracted to purchase the property and, subject to the terms and conditions set forth in
Section 9(d) hereof, that Closing of this Contract is expressly conditioned on closing of the
underlying contract for Seller to Purchase the Property as more fully set forth below.

(b) Validity. Seller is a duly formed and validly existing limited liability company
organized under the laws of Texas. Seller has the full right, power, authority and capacity to
execute and perform this Contract. The execution and delivery of this Contract, the consummation
of the transaction herein contemplated and the compliance with the terms of this Contract will not:
(i) conflict with or result in a breach of any of the terms or provisions of, or constitute a
default under any indenture, mortgage, loan agreement, contract, partnership agreement, or other
instrument of any nature whatsoever to which Seller is a party or by which Seller or its property
is bound, or any applicable law, rule, regulation, judgment, order or decree of any governmental
instrumentality or court, domestic or foreign, having jurisdiction over Seller or its properties or
(ii) result in the creation or imposition of any lien, charge or encumbrance upon the Property.
This Contract is a legal, valid and binding obligation of Seller, enforceable against Seller in
accordance with its terms, subject to the effect of applicable bankruptcy, insolvency,
reorganization, arrangement, moratorium or other similar laws affecting the rights of creditors
generally.

(c) Violations of Law. Seller has not received notice and is not aware of any
violation of any law, ordinance, regulation or requirement affecting the Property.

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(d) Litigation. There are no actions, suits or proceedings pending, or to Seller’s
actual knowledge, threatened against (a) any portion of the Property, or (b) affecting Seller’s
ability to perform its obligations hereunder.

(e) Insolvency. Seller has not (i) made a general assignment for the benefit of
creditors, (ii) filed any voluntary petition in bankruptcy or, to Seller’s actual knowledge,
suffered the filing of an involuntary petition by Seller’s creditors, (iii) to Seller’s actual
knowledge, suffered the appointment of a receiver to take possession of all or substantially all of
Seller’s assets, (iv) to Seller’s actual knowledge, suffered the attachment or other judicial
seizure of all, or substantially all, of Seller’s assets, (v) admitted in writing its inability to
pay its debts as they come due, or (vi) made an offer of settlement, extension or composition to
its creditors generally.

(f) Condemnation. To Seller’s knowledge, there is no pending, threatened or
contemplated condemnation proceeding relating to the Property, and Seller has received no written
notice from any governmental agency or official to the effect that any such proceeding is
contemplated.

(g) Environmental. Except as otherwise disclosed in documents that are delivered to
Purchaser within ten (10) days of the Effective Date of this Contract, to Seller’s knowledge, there
are no Hazardous Materials stored on, incorporated into, located on, present in or used on the
Property in violation of, and requiring remediation under, any laws, ordinances, statutes, codes,
rules or regulations as of the Effective Date or in existence on the date of Closing. For purposes
of this Contract, the term “Hazardous Materials” shall mean any substance which is or
contains: (i) any “hazardous substance” as now or hereafter defined in Section 101(14) of the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C.
Section 9601 et seq.) (“CERCLA”) or any regulations promulgated under CERCLA; (ii) any
“hazardous waste” as now or hereafter defined the Recourse Conservation and Recovery Act (42 U.S.C.
Section 6901 et seq.) (“RCRA”) or regulations promulgated under RCRA; (iii) any substance
regulated by the Toxic Substances Control Act (15 U.S.C. Section 2601 et. seq.); (iv) gasoline,
diesel fuel or other petroleum hydrocarbons; (v) asbestos and asbestos containing materials, in any
form, whether friable or non-friable; (vi) polychlorinated biphenyls; (vii) radon gas: and (viii)
any additional substances or materials which are now or hereafter classified or considered to be
hazardous or toxic under any laws, ordinances, statutes, codes, rules, regulations, agreements,
judgments, orders and decrees now or hereafter enacted, promulgated, or amended, of the United
States, the state, the county, the city or any other political subdivision in which the Property is
located and any other political subdivision, agency or instrumentality exercising jurisdiction over
the owner of the Property, the Property or the use of the Property relating to pollution, the
protection or regulation of human health, natural resources or the environment, or the emission,
discharge, release or threatened release of pollutants, contaminants, chemicals or industrial,
toxic or hazardous substances or waste into the environment (including, without limitation, ambient
air, surface water, ground water or land or soil.

(h) Code Section 1445(f). Seller is not a “foreign person” within the meaning of
Section 1445(f) of the Internal Revenue Code of 1986, as amended (the “Code”).

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(i) OFAC. Neither Seller nor any of its affiliates, nor any of their respective
partners, members, shareholders or other equity owners, and none of their respective employees,
officers, directors, representatives or agents is, nor will they become, a person or entity with
whom United States persons or entities are restricted from doing business under regulations of the
Office of Foreign Asset Control (“OFAC”) of the Department of the Treasury (including those
named on OFAC’s Specially Designated and Blocked Persons List) or under any statute, executive
order (including, without limitation, the September 24, 2001, Executive Order Blocking Property and
Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism), or
other governmental action, and is not and will not engage in any dealings or transactions or be
otherwise associated with such persons or entities.

(j) Governmental Approvals. No authorization, consent, or approval of any
governmental authority (including courts) is required for the execution and delivery by Seller of
this Contract or the performance of its obligations hereunder.

(k) Warranty Failures. Seller will not take or cause to be taken any action or fail
to perform any obligation which would cause any of the representations or warranties contained in
this Contract to be untrue as of the Closing. Seller shall immediately notify Buyer, in writing,
of any event or condition known to Seller which occurs prior to the Closing, which causes a change
in the facts relating to, or the truth of, any of the representations or warranties.

(l) The zoning for the Property permits the construction and operation of a manufacturing
facility.

7. Closing. Subject to the terms and conditions of this Contract, the consummation of the
transaction contemplated by this Contract (the “Closing”) shall take place at the offices
of the Title Company on a date designated by Purchaser on or before thirty (30) days after the
expiration of the Inspection Period (which date is herein referred to as the “Date of
Closing”). Purchaser shall give Seller at least three (3) days prior written notice of the
Closing Date selected by Purchaser.

(a) Seller’s Obligations at Closing. At the Closing, Seller shall do the following:

(i) Special Warranty Deed. Deliver to Purchaser a special warranty deed in the form
attached hereto as Exhibit “D” (the “Deed”) conveying the Property, duly signed and
acknowledged by Seller, which shall be in form for recording and shall convey to Purchaser good and
marketable fee simple title to the Property, free and clear of all liens, claims, encumbrances,
covenants, conditions, restrictions, rights, rights-of-way, easements, and any other matters
affecting title to the Property, except the Permitted Exceptions.

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(ii) Title Policy. Cause to be delivered to Purchaser an owner’s policy of title
insurance (the “Policy”) paid for by Seller on the standard Texas form in an insured amount
equal to the Purchase Price, issued by the Title Company, as agent for the title insurer, insuring
as of the Date of Closing, that good and indefeasible title to the Property is vested in Purchaser.
Seller shall cause the Title Company to issue the Policy with no exceptions other than the
standard printed exceptions and the Permitted Exceptions, except that (A) the standard
survey exception shall be modified on the Policy, at Seller’s expense, to reflect “shortages in
area” only, (B) the standard exception as to restrictive covenants shall be endorsed “None of
Record”, (C) except for such restrictions as may be included in the Permitted Exceptions and the
standard exception as to taxes shall be limited to the year of Closing and endorsed “Not Yet Due
and Payable”, (D) no exception shall be permitted for “visible and apparent easements,” or words to
that effect; and (E) no exception shall be permitted for “rights of parties in possession” or words
to that effect. Purchaser shall have the option to accept such insurable title as Seller may be
able to convey at the Closing and the Policy subject to any exceptions not herein set forth, but
acceptance of such title and the Policy shall in no event constitute waiver on Purchaser’s part of
any warranties contained in this Contract or in any other instrument delivered to Purchaser
pursuant to the transaction contemplated hereby.

(iii) Evidence of Authority. Deliver to Purchaser a certified copy, in recordable
form, of the duly authorized governing body or bodies of Seller authorizing execution of this
Contract and all documents necessary or advisable to consummate the transactions contemplated
hereby, such actions to be sufficient to authorize the consummation of the transaction contemplated
hereby.

(iv) Non-Foreign Person Affidavit. A non-foreign person affidavit sworn to by Seller
as required by Section 1445 of the Code.

(v) Title Company Requirements. Such evidence, documents, affidavits and
indemnifications as may be reasonably required by the Title Company as a precondition to the
issuance of the Title Policy relating to: (A) mechanics’ or materialmen’s liens; (B) parties in
possession; (C) the status and capacity of Seller and the authority of the person or persons who
are executing the various documents on behalf of Seller in connection with the sale of the
Property; or (D) any other matter reasonably required to enable the Title Company to issue the
Policy and endorsements thereto.

(vi) Seller shall deliver to Purchaser a certificate dated the Date of Closing, duly executed
by Seller, affirming that (i) each and all of the representations and warranties of Seller in
Section 6 are true and accurate in all respects at and as of the Closing Date, and (ii) Seller has
delivered, performed, observed, and complied with all of the items, instruments, documents,
covenants, agreements, and conditions required by this Contract to be delivered, performed,
observed, and complied with by Seller prior to, or as of, the Closing.

(vii) Development and Escrow Agreement. Seller shall deliver the Development and
Escrow Agreement, executed and acknowledged by Seller.

(b) Purchaser’s Obligation at Closing. At the Closing, Purchaser shall do the
following:

(i) Cash. Deliver to Seller, the Cash Portion of the Purchase Price as provided in
Paragraph 2 hereof, and to deliver to the Escrow Portion of the Purchase Price to the Escrow Agent.

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(ii) Deed. Purchaser shall deliver the Deed, executed and acknowledged by Purchaser
evidencing Purchaser’s acceptance thereof.

(iii) Development and Escrow Agreement. Purchaser shall deliver the Development and
Escrow Agreement, executed and acknowledged by Purchaser.

(d) Possession. Seller hereby agrees to give actual possession and occupancy of the
Property to Purchaser at Closing.

(e) Costs of Closing. Except as otherwise provided herein, Seller shall be
responsible for paying, on the Date of Closing, one-half of the escrow fees charged by the Title
Company, Seller’s attorney’s fees, the cost of recording the Deed, the cost of the Survey, the
basic premium costs for the Policy (with Purchaser to pay the premium for any modifications or
endorsements to the Policy (including, without limitation, the additional premium for modifying the
printed survey exception, if requested by Purchaser), all costs for title curative matters, and
Seller’s share of any other closing costs which are normally assessed by the Title Company against
such party in a transaction of this character. Purchaser shall be responsible for paying, on the
Date of Closing, one-half of the escrow fees charged by the Title Company, the premiums for any
modifications or endorsements to the Policy (including, without limitation, the additional premium
for modifying the printed survey exception, if requested by Purchaser), costs associated with its
investigation of the Property, Purchaser’s attorney’s fees and Purchaser’s share of any other
closing costs which are normally assessed by the Title Company against such party in a transaction
of this character.

(f) Tax Prorations. Ad valorem real estate taxes and similar taxes and assessments,
excluding any Roll-Back Taxes (as hereafter defined) relating to the Property for the year in which
the Closing occurs (“Taxes”) shall be prorated between Seller and Purchaser as of the Date
of Closing, based on the most recent tax bill(s) for the Property. If Closing occurs before Taxes
have been assessed for the year of Closing, then the apportionment of the Taxes at Closing shall be
based upon the actual Taxes most recently assessed for the Land. Any difference between the amount
of actual Taxes from the amount estimated at Closing shall be adjusted in cash between the parties
upon the written request of either party. If the Property is not assessed as a separate parcel for
tax purposes, then the Taxes associated with the tax parcel(s) which are allocable to the Land
shall be determined by multiplying the total bill attributable only to the land associated with the
tax parcel by a fraction having as its numerator the total amount of acreage (to the nearest
1/100th of an acre) contained within the Land and as its denominator the total amount of acreage
(to the nearest 1/100th of an acre) contained within such tax parcel. Subject to the proration
obligations under this Section 7(f), Purchaser shall assume and pay for all Taxes relating to the
Property for the year in which the Closing occurs and subsequent years. The Property has been
assessed for property tax purposes at such rates that will result in additional taxes and interest
being assessed upon the change in Property usage or ownership of the Property by virtue of the
Property having received any agricultural, open-space or other special use valuation (such
additional taxes, interest and similar assessments being referred to herein as “Roll-Back
Taxes”). Seller hereby agrees to pay at Closing all such Roll-Back Taxes attributable to the
Land and to indemnify and save Purchaser harmless from and
against all claims and liability for such Roll-Back Taxes pertaining to the Property,
regardless of when they were incurred.

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8. As Is Sale. Purchaser expressly acknowledges that the Property is being sold and accepted
AS-IS, WHERE-IS WITH ALL FAULTS, and except as to warranties and representations set forth in
Section 6: (A) Seller makes no representations or warranties, express or implied, with respect to
the physical condition or any other aspect of the Property, including, without limitation, (i) the
structural integrity of any Improvements on the Property; (ii) the manner, construction, condition
and state of repair or lack of repair of any of such Improvements; (iii) the conformity of the
Improvements to any plans or specifications for the Property, including but not limited to any
plans and specifications that may have been or which may be provided to Purchaser; (iv) the
conformity of the Property to past, current or future applicable zoning or building code
requirements or the compliance with any other laws, rules, ordinances or regulations of any
government or other body; (v) the current and/or historical operating expenses and/or financial
earning capacity of the Property, (vi) the Property’s investment potential or resale potential at
any future date, at a profit or otherwise; (vii) the status of title to the Property, including the
nature, extent and/or effect of any right-of-way, lease or other right of possession, lien,
easement, license, reservation, condition or other Encumbrance affecting the Property; (viii) the
existence of soil instability, past soil repairs, soil additions or conditions of soil fill,
susceptibility to landslides, sufficiency of undershoring or sufficiency of drainage to, from or
across the Property; (ix) whether the Property is located wholly or partially in a flood plain or a
flood hazard boundary or similar area or within any area that may be considered wetlands or
jurisdictional waters of the United States; (x) the existence or non-existence of asbestos,
underground or above ground storage tanks, hazardous waste or other toxic or hazardous materials of
any kind or any other environmental condition, or whether the Property is in compliance with
applicable laws, rules and regulations; (xi) general and/or specific economic conditions and/or the
impact thereof on the market for the leasing or re-sale of the Property and/or any other impact on
the Property or the financial performance thereof; (xii) any tax consequences of ownership of the
Property; or (xiii) any other matter whatsoever affecting the stability, integrity, other condition
or status of the land or any buildings or improvements situated on all or part of the Property
(collectively, the “Property Conditions”), and (B) PURCHASER HEREBY UNCONDITIONALLY AND IRREVOCABLY
WAIVES ANY AND ALL ACTUAL OR POTENTIAL RIGHTS PURCHASER MIGHT HAVE REGARDING ANY FORM OF WARRANTY,
EXPRESS OR IMPLIED OR ARISING BY OPERATION OF LAW, INCLUDING, BUT IN NO WAY LIMITED TO ANY WARRANTY
OF QUANTITY, QUALITY, CONDITION, HABITABILITY, MERCHANTABILITY, SUITABILITY OR FITNESS FOR A
PARTICULAR PURPOSE RELATING TO THE PROPERTY, ITS IMPROVEMENTS OR THE PROPERTY CONDITIONS, SUCH
WAIVER BEING ABSOLUTE, COMPLETE, TOTAL AND UNLIMITED IN ANY WAY.

8.2 Information Disclaimer. Subject to the express representation and warranties of Seller
contained in Section 6, any and all information and/or descriptions related to the Property and
provided to Purchaser by Seller, Seller’s Agent or any other party on behalf of Seller, whether
internally prepared by Seller or prepared by third parties (“Information”), shall be
delivered without any representation or warranty as to the completeness or accuracy of the data or
other information contained therein, and all such Information is furnished to Purchaser solely
as a courtesy, and Seller has neither verified the accuracy of any statements or other
information therein contained, the method used to compile such Information nor the qualifications
of the persons preparing such Information. The Information is provided on an AS-IS, WHERE-IS
BASIS, AND PURCHASER EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF SELLER
HEREIN, SELLER MAKES NO REPRESENTATION, EXPRESS OR IMPLIED, OR ARISING BY OPERATION OF LAW,
INCLUDING, BUT IN NO WAY LIMITED TO, ANY WARRANTY OF QUANTITY, QUALITY, CONDITION, HABITABILITY,
MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE AS
TO THE INFORMATION.

Contract for Sale — Page 10

 

 

 

8.3 Waiver of Compliance with Requirements. Subject to the express representation and
warranties of Seller contained in Section 6, Purchaser expressly acknowledges that Purchaser is not
relying on (and Seller hereby disclaims and renounces) any representations or warranties made by or
on behalf of Seller of any kind or nature whatsoever, except as expressly provided in Section 6.
Purchaser acknowledges that the Property may not be in compliance with all Laws that may apply to
the Property or any part thereof and the continued ownership, maintenance, management and repair of
the Property (“Requirements”). Purchaser shall be solely responsible for any and all
Requirements, Property Conditions and all other aspects of the Property, whether the same shall be
existing as of the Closing Date or not.

8.4 Environmental Waiver. Without limitation, to the fullest extent permitted by law, and
except for the warranties contained in Section 6 (g) of this Contract, Purchaser hereby releases
Seller from and waives any and all claims and liabilities against Seller for, related to or in
connection with any environmental condition at the Property (or the presence of any matter or
substance relating to the environmental condition of the Property), including, but not limited to,
claims and/or liabilities relating to (in any manner whatsoever) any hazardous, toxic or dangerous
materials or substances located in, at, about or under the Property, or for any and all claims or
causes of action (actual or threatened) based upon, in connection with or arising out of: (i) the
Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. §§9601 et seq.)
(“CERCLA”); (ii) the Resource Conservation and Recovery Act (42 U.S.C. §§6901 et seq.) (“RCRA”);
(iii) the Superfund Amendments and Reauthorization Act (42 U.S.C. §§9601 et seq.) (“SARA”); or (iv)
any other claim or cause of action (including any federal or state based statutory, regulatory or
common law cause of action, including without limitation, the Texas Solid Waste Disposal Act)
related to environmental matters or liability with respect to or affecting the Property.

8.5 Purchaser Relying on Own Inspections. Purchaser acknowledges and agrees that the
provisions contained in Sections 8.1 — 8.4 above were a material factor in Seller’s acceptance of
the Purchase Price and that Seller was unwilling to sell the Property to Purchaser unless Seller
was released as expressly set forth above. With respect to Purchaser’s waivers and agreements
contained in Sections 8.1 — 8.4 above, the Purchaser represents and warrants to the Seller that:
(i) Purchaser is represented by legal counsel in connection with the sale contemplated by this
Contract; (ii) Purchaser, with Purchaser’s counsel, has fully reviewed the disclaimers and waivers
and agreements set forth in this Contract and understands their significance and effect; (iii)
Purchaser is knowledgeable and experienced in the purchase, operation, ownership,
refurbishing and sale of commercial real estate, and is fully able to evaluate the

Contract for Sale — Page 11

 

 

 

merits and
risks of this transaction; and (iv) Purchaser is not in a significantly disparate bargaining
position. As part of the provisions of this Section 8, but not as a limitation thereon, Purchaser
hereby agrees, represents and warrants that the matters released herein are not limited to matters
which are known or disclosed. In this connection, to the extent permitted by law, Purchaser hereby
agrees, represents and warrants that it realizes and acknowledges that factual matters now unknown
to it may have given or may hereafter give rise to causes of action, claims, demands, debts,
controversies, damages, costs, losses and expenses which are presently unknown, unanticipated and
unsuspected, and Purchaser further agrees, represents and warrants that the waivers and releases
herein have been negotiated and agreed upon in light of that realization and that Purchaser
nevertheless hereby intends to release, discharge and acquit Seller from any such unknown causes of
action, claims, demands, debts, controversies, damages, costs, losses and expenses which might in
any way be included in the waivers and matters released as set forth in this Section 8 above.

8.7 Survival. Notwithstanding anything herein to the contrary, all of the terms and
provisions of this Section 8 shall survive the Closing.

9. Miscellaneous.

(a) Notices. All notices, demands, and requests that may be given or that are
required to be given by either party to the other shall be in writing and either hand-delivered,
delivered by any nationally known overnight delivery service for next business day delivery, or
sent by United States certified mail, return receipt requested, postage prepaid, addressed as
follows:

	 	 	 
	If to Seller:

	 	SSAE Development, LLC
	 

	 	Attn: Scott Schwob
	 

	 	2349 Glenda Lane
	 

	 	Dallas, TX 75229
	 

	 	(972) 243-7674
	 

	 	(972) 243-7710 fax
	 
	 	 
	If to Purchaser:

	 	Peerless Mfg. Co.
	 

	 	Attn: Peter Burlage, CEO
	 

	 	14651 North Dallas Parkway, Suite 500
	 

	 	Dallas, TX 75254
	 

	 	(214) 353-5545
	 

	 	(214) 351-0194 fax

or to such other parties and at such other places as Purchaser or Seller may from time to time
designate in a written notice to the other. Notices, demands, and requests, served upon Seller or
Purchaser in the aforesaid manner shall be deemed sufficiently served or given for all purposes
hereunder, whether actually received or not, at the time such notice, demand, or request is
delivered to the address stated above, or if such notice, demand, or request is sent by United
States certified mail or any nationally known overnight delivery service, then three (3) days after
the date same is deposited in a regularly maintained receptacle for deposit of United States mail,
addressed and sent as aforesaid.

Contract for Sale — Page 12

 

 

 

(b) Breach by Seller. In the event Seller shall fail fully and timely to perform any
of its obligations hereunder or shall fail to consummate the sale of the Property for any reason,
except Purchaser’s default or the termination of this Contract pursuant to any of the termination
provisions hereof, Purchaser shall be entitled to any one of the following remedies (as its sole
and exclusive remedies): (i) waive such failure and proceed to the Closing; (ii) exercise an action
for specific performance to cause Seller to convey the Property to Purchaser pursuant to the terms
and conditions of this Agreement; or (iii) terminate this Agreement by notice to Seller and the
Title Company to that effect, to recover the full amount of the Escrow Deposit, together with
damages in the amount equal to Purchaser’s out-of-pocket, third-party costs and expenses incurred
in connection with the transaction contemplated by this Agreement.

(c) Breach by Purchaser. In the event Purchaser should fail to consummate the
purchase of the Property, the conditions to Purchaser’s obligations set forth in this Contract
having been satisfied and Purchaser being in default and Seller not being in default hereunder,
Seller shall be entitled to any one of the following remedies (as its sole and exclusive remedies):
(i) exercise an action for specific performance to cause Purchaser to buy the Property from Seller
pursuant to the terms and conditions of this Agreement; (ii) terminate this Agreement by notice to
Purchaser and the Title Company to that effect, to recover the full amount of the Escrow Deposit as
liquidated damages; or (iii) recover damages from Purchaser in the amount equal to Seller’s
out-of-pocket, third-party costs and expenses incurred in connection with the transaction
contemplated by this Agreement.

(d) Intentionally Deleted.

(e) Survival of Closing. All covenants, warranties, representations, and agreements
of the parties hereto shall survive the Closing and shall not be merged therein.

(f) Entire Agreement. This Contract embodies the entire agreement between the parties
relative to the subject matter of this Contract. There are no oral or written agreements existing
between the parties relative to the subject matter hereof that are not expressly set forth herein
and covered hereby.

(g) Captions. The captions, headings, and arrangements used in this Contract are for
convenience only and do not in any way affect, limit, amplify, or modify the terms and provisions
hereof.

(h) Governing Law. This Contract is intended to be performed in the County of Denton
Texas, and the laws of such State shall govern the validity, construction, enforcement, and
interpretation of this Contract and all other documents or instruments delivered pursuant hereto,
unless otherwise expressly specified therein.

Contract for Sale — Page 13

 

 

 

(i) Invalid Provision. If any provision of this Contract is held to be illegal,
invalid, or unenforceable under present or future laws, such provision shall be fully severable;
this Contract shall be construed and enforced as if such illegal, invalid, or unenforceable
provision had never comprised a part of this Contract; and the remaining provisions of this
Contract shall remain in full force and effect and shall not be affected by the illegal, invalid,
or unenforceable provision or by its severance from this Contract.

(j) Form of Documents. Each agreement, document, instrument, or other writing to be
furnished to Purchaser and Seller under any provision of this Contract must be in form and
substance reasonably satisfactory to Purchaser and Seller and their respective counsel.

(k) Multiple Counterparts. This Contract may be executed in a number of identical
counterparts, each of which for all purposes is deemed an original, and all of which constitute
collectively one Contract; but in making proof of this Contract, it shall not be necessary to
produce or account for more than one such counterpart.

(l) Successors and Assigns. This Contract shall bind and inure to the benefit of
Seller and Purchaser and their respective heirs, legal representatives, successors, and assigns.

(m) Time of Essence. Time is of the essence of this Contract.

(n) Attorney’s Fees. In the event it becomes necessary for either party hereto to
file suit to enforce this Contract or any provision contained herein, the party prevailing in such
suit shall be entitled to recover, in addition to all other remedies or damages, reasonable
attorney’s fees incurred in such suit.

(o) Risk of Loss. Risk of loss until the Closing Date shall be borne by Seller. In
the event that damage, loss or destruction of the Property or any part thereof, by fire or other
casualty, or through condemnation or sale in lieu thereof, occurs prior to the actual closing of
the transaction contemplated hereby, then Purchaser may, at its option, elect one of the following
options: (i) to terminate this Contract and receive an immediate refund of all Escrow Deposit; or
(2) to close the transaction contemplated hereby and take an assignment of and receive in cash all
insurance or condemnation proceeds payable as a result of such casualty loss or condemnation, and
receive a credit in the amount of any deductible applicable to such insurance coverage, or, if such
proceeds are not made available by the holder or holders of any indebtedness secured by liens
against the Property, to receive a credit against the Purchase Price in the amount of such casualty
loss or condemnation proceeds together with any deductible amount applicable thereto.

(p) Time Periods. If the last day of any time period stated herein shall fall on a
Saturday, Sunday or legal holiday, then such time period shall be extended to the next succeeding
day which is not a Saturday, Sunday or a legal holiday.

(q) IRS Real Estate Sales Reporting. Seller and Purchaser agree that the Title
Company shall act as “the person responsible for closing” the transaction which is the subject of
this Contract pursuant to Code Section 6045(e) and shall prepare and file all informational
returns, including without limitation, IRS Form 1099-S, and shall otherwise comply with the
provisions of Code Section 6045(e).

Contract for Sale — Page 14

 

 

 

(r) Effective Date. The date on which the Title Company receives counterparts of this
Contract fully executed by Seller and Purchaser shall be the “Effective Date” of this
Contract. Title Company shall insert the Effective Date where indicated on the Title Company’s
acknowledgement page below prior to distributing fully executed counterparts to each party.

IN WITNESS WHEREOF, this Contract is hereby executed as of the Effective Date.

	 	 	 	 	 
	 	SELLER:

SSAE DEVELOPMENT, LLC,

a Texas limited liability company

 	 
	 	By:  	/s/ Scott Schwob
 	 
	 	 	Name:  	Scott Schwob 	 
	 	 	Title:  	President
 	 
	 	 	Date Executed: Sept. 13, 2011	 

	 	 	 	 	 
	 	PURCHASER:

PEERLESS MFG. CO.,

a Texas corporation

 	 
	 	By:  	/s/ Peter Burlage
 	 
	 	 	Name:  	Peter Burlage    	 
	 	 	Title:  	President
	 
	 	 	Date Executed: Sept. 14, 2011	 

Contract for Sale — Page 15

 

 

 

RECEIPT OF TITLE COMPANY

By its execution below, Title Company acknowledges receipt of: (1) an executed copy of this
Contract and (2) the Earnest Money described in this Contract. Title Company agrees to comply with
and be bound by the terms and provisions of this Contract and to perform its duties pursuant to the
provisions of this Contract including without limitation those terms relating to: (i) the holding
and delivery of the Earnest Money and (ii) compliance with Section 6045(e) of the Internal Revenue
Code of 1986, as amended from time to time, and as further set forth in any Regulations or forms
promulgated thereunder. The “Effective Date” for purposes of this Contract is                     ,
being date on which the last of Seller’s and Purchaser’s fully executed counterparts of this
Contract were received by Title Company.

	 	 	 	 	 	 	 	 	 
	 	 	TITLE COMPANY:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	REPUBLIC TITLE OF TEXAS, INC.

Attn: Joanna Cloud

420 Throckmorton, Suite 640

Fort Worth, Texas 76102

Telephone: (817) 877-1481

Telecopy: (817) 654-0008	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	Date Executed:	 	 	 	 
	 

	 	 	 	 	 	 	 	 

Contract for Sale — Page 16

 

 

 

EXHIBIT A

Land Description

Consisting of 32.929 acres more or less, situated in the City of Denton, Denton County, Texas, as
more particularly described in the Final Plat thereof as Lot 1, Block B, Ryan Companies Addition,
an addition to the City of Denton, Denton County, Texas.

 

17

 

EXHIBIT B

Development and Escrow Agreement

DEVELOPMENT WORK AND ESCROW AGREEMENT

This Development Work and Escrow Agreement (“Agreement”) is made and entered into as of the

 _____ 
day of September, 2011, by and among SSAE DEVELOPMENT, LLC, a Texas limited liability company
(“Seller”) and PEERLESS MFG. CO., a Texas corporation (“Purchaser”). Republic Title of Texas, Inc.
(“Escrow Agent”) also executes this Agreement in its capacity as Escrow Agent hereunder.

RECITALS:

A. Seller is the owner of a certain parcel of undeveloped property located in Denton County,
Texas described as a portion of Lot 2, Block A, Ryan Companies Addition, an addition to the City of
Denton, Denton County, Texas, according to a conveyance plat recorded under Instrument No. 2010-96
in plat records of Denton County, Texas (“Property”).

B. Seller has applied for, and received, final approval from the City of Denton to replat a
portion the Property. The plat, as applied for and approved, dedicates certain property to the
City of Denton, Texas for Dakota Lane, a public street to be constructed. The approved Final Plat
(“Plat”) is incorporated herein for all purposes.

C. Seller and Purchaser have entered into a Contract of Sale (“Contract”) for the purchase and
sale of Lot 1, Block B, Ryan Companies Addition, as designated on the Plat (“Lot 1”). The Contract
provides that the parties will enter into this Development Agreement regarding Seller’s obligations
to develop Lot 1 for Purchaser’s use as a condition of closing the purchase of Lot 1. All
capitalized terms used herein not otherwise defined herein shall have the meaning set forth
therefor in the Contract.

D. This Development Agreement sets forth the work which Seller shall perform post closing for
the construction of Dakota Lane, the development of Lot 1 and the Property as a whole.

AGREEMENTS:

NOW, THEREFORE, for Ten and No/100 Dollars ($10.00), the mutual agreements set forth herein,
and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged and confessed, Seller and Purchaser stipulate and agree as follows:

1. Development Work of Seller.

A. Seller, at Seller’s sole cost and expense, shall perform all work necessary to complete the
following matters (“Development Work”) within the time periods specified below:

1. Dakota Lane. Seller shall furnish all labor, materials, bonds and other things
necessary for the design and construction of proposed Dakota Lane. Within the time periods
set forth below, Seller shall (i) complete the overall construction of Dakota Lane as
indicated for on the Final Plat, all in accordance with regulations and approvals required
by the applicable local governmental authorities having jurisdiction over the
same, and in accordance with the Agreed Plans, Drawings and Specifications
(as defined
below), and (ii) complete the construction and installation of water utility lines (“Water
Lines”) and gas utility lines (“Gas Lines”) (the Water Lines and Gas Lines are sometimes
referred to herein collectively as the “Utility Lines”) which will connect into the existing
water and gas main lines which are currently completed and publicly dedicated, and such
Utility Lines shall be placed in applicable right of way along or under Dakota Lane to
provide water and gas utility service to Lot 1, all in accordance with the Agreed Plans,
Drawings and Specifications. These improvements to be constructed by Seller shall also
include storm water, public water, and roadwork per City of Denton Standards.

 

18

 

2. Sewer Line. Seller shall complete all work necessary to complete the construction
and installation of sewer lines (“Sewer Lines”) which will connect into the existing main
sewer lines which are currently completed and publicly dedicated, and such Sewer Lines shall
be placed in applicable right of way along or under Dakota Lane to provide water and gas
utility service to Lot 1, all in accordance with the Agreed Plans, Drawings and
Specifications.

3. New Power Lines. Seller will cause Denton Municipal Electric (“DME”), at DME’s
cost, and if not at DME’s cost, then Seller’s cost, to construct facilities as required to
provide electric service to the Property per DME Electric Service Standards. It is expected
that such lines shall be above ground and shall otherwise satisfy the requirements of the
utility company providing electric service to the Property and all applicable governmental
authorities having jurisdiction over the same. Seller shall also grant and/or obtain all
appropriate easement rights as necessary in favor of the utility company to maintain and
operate the power lines to provide electric service to the Property.

4. Telephone/Fiber Optics. Seller will cause the necessary telephone lines, data
cabling to be brought to the Property. It is expected that such lines shall be below
ground, be located along or under Dakota Lane, and shall otherwise satisfy the requirements
of the utility company providing service to the Property and all applicable governmental
authorities having jurisdiction over the same. Seller shall also grant and/or obtain all
appropriate easement rights as necessary in favor of the utility company to maintain and
operate the telephone/data lines to provide service to the Property.

5. Onsite Improvements. Seller shall complete all work necessary to complete the
construction and installation of the storm drainage, headwall and rip/rap located on and
across Lot 1 as shown on the Final Plat in accordance with the Agreed Plans, Drawings and
Specifications.

B. Purchaser agrees that if Purchaser’s construction and development activities with respect
to the Intended Development result in any damage to any Development Work completed by Seller or if
such activities result in debris accumulating within Development Work areas Purchaser at its sole
cost and expense shall repair such damage and remove such debris and clean such areas affected, as
applicable.

C. The parties stipulate and agree that the “Agreed Plans, Drawings and Specifications” for
the Development Work shall be those Plans for Dakota Lane Paving, Drainage and Water System
Improvements prepared by Weir & Associates, Inc. which are incorporated herein for all purposes.
Purchaser acknowledges that it has been provided a copy
of said plans. The Complete Drawing List for the Agreed Plans, Drawings and Specifications is
attached hereto as Schedule “A”.

 

19

 

D. Seller shall perform all such Development Work in a good and workmanlike manner in
conformance with sound and acceptable engineering practices. In performing the work or causing the
work to be performed, Seller shall make adequate provisions for the safety and convenience of
Purchaser with respect to its use and operations on the Property, and shall cause all work to be
cleaned up promptly in order to minimize disruption or inconvenience, and coordinate the work with
Purchaser’s contractors and subcontractors performing other work, if any, on the Property
simultaneously with the Development Work. All such Development Work shall be conducted in full
compliance with all applicable federal, state, municipal, or other laws, statutes, codes,
restrictions, regulations, ordinances and orders. The provisions of this Section shall survive the
Closing.

E. Seller shall complete the Development Work within one hundred twenty (120) days of closing
of the Contract of Sale between Seller and Purchaser. This time period may be extended for up to
an additional ninety (90) days by Seller, but only if the need for such extension is for reasons
beyond Seller’s control and only if Seller has been and is continuously and diligently pursuing
completion of the same using its best efforts.

2. Escrow for Development Work.

A. The amount of $867,082.00 (“Development Escrow Amount”) will be held back from the sales
proceed due Seller under the Closing under the Contract and deposited into an escrow account
established with Escrow Agent (“Development Escrow Account”). The Development Escrow Account shall
be an interest bearing account selected by Seller (and established with Seller’s federal tax
identification number) and reasonably approved by Purchaser. All interest earned on the Development
Escrow Amount shall be added to and shall constitute a portion of the Development Escrow Amount
(and hereinafter, all references to “Development Escrow Amount” or “the balance in the Development
Escrow Account” or similar references shall be deemed to include reference to all such accrued
interest).

B. Disbursements from the Development Escrow Account shall be controlled by the following
provisions:

(i) Seller shall only be entitled to withdraw amounts from the Development
Escrow Account for actual, bona fide costs incurred by Seller in completing the
Development Work (“Seller Applicable Costs”);

(ii) Upon incurring Seller Applicable Costs, no more frequently than every
thirty (30) days, Seller may submit to Escrow Agent a request for payment (“Seller
Request”) for such Seller Applicable Costs, which Seller Request shall contain a
certification by Seller and the contractor performing such work that such Seller
Applicable Costs have been incurred in accordance with the provisions of this
Agreement and that the portion of the Development Work relating thereto has been
completed in accordance with the Agreed Plans, Drawings and Specifications therefor,
and such Seller Request shall further
include (i) copies of the underlying applications for payment, invoices and
statements from the persons performing such work and (ii) reasonable evidence that
the portions of the Development Work for which the costs included in the Seller
Request relate have been properly completed. Seller shall simultaneously send a
copy of the Seller Request and all attachments to Purchaser.

 

20

 

(iii) In connection with each Seller Request, Purchaser may review the Seller
Request and the portion of the Development Work covered thereby. If Purchaser,
acting reasonably and in good faith, believes that the work for which the Seller
Request has been issued could not be considered to be completed by any reasonable
person, then Purchaser may send written notice to Seller and Escrow Agent of such
failure to complete within three business days after receipt of such Seller Request
(“Purchaser Notice of Failure to Complete”).

(iv) If for any Seller Request, no Purchaser Notice of Failure to Complete is
sent by Purchaser within such three business day period described above, then Escrow
Agent shall promptly fund to Seller out of the Development Escrow Account the amount
attributable to such Seller Request.

(v) In the event that Purchaser sends a Purchaser Notice of Failure to Complete
within the time period stated above, then Escrow Agent shall not release any amount
from the Development Escrow Account relating to such Seller Request until Escrow
Agent has received written confirmation from Purchaser that Purchaser withdraws its
Purchaser Notice of Failure to Complete. If Seller and Purchaser are in dispute
with respect to any Seller Request hereunder, both parties agree to attempt in good
faith to resolve such dispute in an expeditious manner, and upon request by either
party, a third party mediator may be retained to assist in such resolution.

C. At such time as (i) the Development Work is fully completed in accordance with the Agreed
Plans, Drawings and Specifications, (ii) all contractors performing the Development Work have been
paid in full for the Development Work performed and have delivered to Escrow Agent Affidavits of
Payment and Release of Liens confirming payment in full for work performed and releasing any lien
claims relative to the Development Work and (iii) all such Development Work has been accepted by
local governmental authorities, then upon satisfaction of all such conditions, any funds remaining
in the Development Escrow Account shall be promptly disbursed to Seller and the duties between
Seller and Purchaser relative to the Development Work shall be complete.

D. In the event that that Seller defaults in its obligations with respect to the Development
Work and such default continues for a period of ten (10) days after written notice from Purchaser
to Seller of such default, then Purchaser may, at its option, and without limitation to any other
rights and remedies available to Purchaser at law or in equity as a result of such default,
take-over the Development Work and complete the same, and in such event all amounts remaining in
the Development Escrow Account shall be made available to Purchaser for use by Purchaser in
completing the Development Work in the same manner as the same
would be made available to Seller hereunder if Seller were not in default hereunder. In such
event Seller shall promptly deliver to Purchaser all plans and specifications and other information
and materials relative to the Development Work and, upon request of Purchaser, will assign to
Purchaser all of Seller’s rights, titles and interests in any permits, approvals, licenses,
contracts and agreements pertaining to the completion, construction and performance of the Work.

 

21

 

E. In the event that the amounts in the Development Escrow Account are insufficient to
complete the Development Work, then Seller shall be fully responsible for such deficiency, and
shall deposit into the Development Escrow Account additional funds to cover such anticipated
deficiency at the time the deficiency is reasonably identified; provided, however, if Purchaser has
exercised its rights to take-over the Development Work as provided above, Seller shall fund any
such anticipated deficiency directly to Purchaser at the time such deficiency is reasonably
anticipated.

F. Seller shall promptly pay or cause to be paid when due all costs and expenses incurred in
connection with construction and performance of the Work on Lot1 and Seller shall keep Lot 1 free
and clear of any liens, charges, or claims. IN ADDITION, SELLER SHALL INDEMNIFY, DEFEND AND HOLD
PURCHASER HARMLESS FROM AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES,
PENALTIES, ACTIONS, JUDGMENTS, SUITS, CLAIMS, COSTS, EXPENSES, AND DISBURSEMENTS OF ANY KIND OR
NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED BY, OR ASSERTED AGAINST PURCHASER, RESULTING
FROM, OR ARISING OUT OF, THE PERFORMANCE OF THE WORK.

3. Exculpation of Escrow Agent. In performing its duties as escrow agent under this
Agreement, Escrow Agent shall be liable as a depository only and shall not be responsible for the
sufficiency or accuracy of the form, execution or validity of documents deposited hereunder, or any
description of property or other thing therein, nor shall it be liable in any respect on account of
the identity, authority, or rights of the persons executing or delivering or purporting to execute
or deliver any such document or paper. The Escrow Agent, as part of the consideration for the
acceptance of this escrow, shall not be liable for any acts or omissions done in good faith, nor
for any claims, demands or losses, nor for any damages made or suffered by any party to this
escrow, excepting such as may arise through or be caused by its willful or gross negligence. The
Escrow Agent may rely upon any paper, document, or other writing reasonably believed by it to be
authentic in making any delivery of money or property hereunder. After the entire Development
Escrow Amount has been funded by Escrow Agent to either Purchaser or Seller, the escrow established
hereunder and Escrow Agent’s obligations shall cease; provided, however, that Purchaser’s and
Seller’s continuing obligations under this Contract, as applicable, shall continue.

4. Notices.

A. Any notice required or permitted to be given hereunder by one party to the other shall be
in writing and the same shall be given and shall be deemed to have been served and given if (i)
delivered in person to the address set forth herein below for the party to whom the notice is
given, (ii) placed in the United States mail, return receipt requested, addressed to such
party at the address hereinafter specified, (iii) deposited into the custody of Federal
Express Corporation to be sent by Federal Express Overnight Delivery or other reputable overnight
carrier for next day delivery, addressed to such party at the address hereinafter specified, or
(vi) telecopied by facsimile transmission to such party at the telecopy number listed below,
provided that such transmission is confirmed by a machine generated confirmation report indicating
successful transmission on the date of such transmission.

 

22

 

B. The address of Seller for all purposes under this Contract and for all notices hereunder
shall be:

SSAE DEVELOPMENT, LLC

Attn: Scott Schwob

2349 Glenda Lane

Dallas, TX 75229

Attn: Mr. Scott Schwob

Telecopy: (972) 243-7674

Telephone: (972) 243-7710

with a copy to:

Robert M. Clark, Esq.

Flynn, Francis & Clark, LLP

700 E. Southlake Blvd., Suite 150

Southlake, Texas 76092

Telecopy: (817) 481-5464

Telephone: (817) 329-3000

C. The address of Purchaser for all purposes under this Contract and for all notices hereunder
shall be:

Peerless Mfg. Co.

Attn: Peter Burlage, CEO

14651 North Dallas Parkway, Suite 500

Dallas, TX 75254

Telecopy: (214) 353-5545

Telephone: (214) 351-0194

with a copy to:

Craig Thompson, Esq.

Hallett & Perrin, P.C.

2001 Bryan Street, Suite 3900

Dallas Texas 75201

Telecopy: (214) 204-9172

Telephone: (214) 922-4100

D. From time to time either party may designate another address within the 48 contiguous
states of the United States of America for all purposes of this Contract by giving the other party
not less than thirty (30) days advance written notice of such change of address in accordance with
the provisions hereof.

 

23

 

5. Attorney’s Fees. If any action at law or in equity is necessary to enforce or
interpret the terms of this Agreement, the prevailing party or parties shall be entitled to
reasonable attorney’s fees, costs and necessary disbursements in addition to any other relief to
which such party or parties may be entitled.

6. Miscellaneous. This Agreement (a) shall be binding upon and inure to the benefit
of Seller and Purchaser and their respective legal representatives, successors and assigns (and
without limitation may be collaterally assigned to any of such parties lenders as security for
indebtedness); (b) may be modified or amended only by a writing signed by each of Seller and
Purchaser; (c) shall be governed by and construed in accordance with the laws of the State of
Texas; (d) may be executed in multiple counterparts, each of which shall, for all purposes, be
deemed an original, but which together shall constitute one and same instrument, and the signature
pages from any counterpart may be appended to any other counterpart to assemble fully executed
documents, and counterparts of this Agreement may also be exchanged via electronic facsimile
machines and any electronic facsimile of any party’s signature shall be deemed to be an original
signature for all purposes; and (e) embodies the entire agreement and understanding between the
parties with respect to the subject matter hereof and supersedes all prior agreements, consents and
understandings relating to such subject matter, and without limitation, this Agreement shall
superceded and replace the provisions in the Contract which are restated herein relative to the
subject matters covered herein.

7. Construction. The parties acknowledge that each party and its counsel have
reviewed and revised this Agreement and that the normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting party shall not be employed in the
interpretation of this Agreement or any exhibits hereto. Wherever required by the context, any
gender shall include any other gender, the singular shall include the plural, and the plural shall
include the singular.

8. Severability. In case any one or more of the provisions contained in this
Agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect,
such invalidity, illegality, or unenforceability shall not affect any other provision hereof,
and this Agreement shall be construed as if such invalid, illegal, or unenforceable provision
had never been contained herein.

 

24

 

Executed to be effective as of the date first written above.

	 	 	 	 	 	 	 	 	 
	 	 	SELLER:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SSAE DEVELOPMENT, LLC, a Texas 
limited
liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Scott Schwob,	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 

	 	 	 	 	 	 	 
	 	 	PURCHASER:	 	 
	 
	 	 	 	 	 	 
	 	 	PEERLESS MFG CO.,

a Texas corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

 

25

 

SCHEDULE “A”

Agreed Plans, Drawings and Specifications

	A: 	 	The Plans and Specifications prepared by Weir and Associates, Inc. for Dakota Lane Paving,
Drainage and Water System Improvements with the following sheets:

Dakota Lane Paving, Drainage and Water System Improvements

Document List

	 	 	 	 	 	 	 
	 	 	 	 	 	 	Document
	Sort	 	Page	 	Title	 	Date
	1

	 	None
	 	Final Plat-1
	 	3/10/2011
	2

	 	None
	 	Final Plat-2
	 	3/10/2011
	3

	 	S001
	 	Topographic Legend
	 	3/10/2011
	4

	 	S002
	 	Sheet Quantities
	 	3/10/2011
	5

	 	P001
	 	Typical Section
	 	3/10/2011
	6

	 	P101
	 	Paving Plan and Profile
	 	3/10/2011
	7

	 	P102
	 	Paving Plan and Profile
	 	3/10/2011
	8

	 	P103
	 	Paving Plan and Profile
	 	3/10/2011
	9

	 	P104
	 	Paving Plan and Profile
	 	3/10/2011
	10

	 	P105
	 	Paving Plan and Profile
	 	3/10/2011
	11

	 	P301
	 	Standard Concrete Paving Details
	 	2/25/1986
	12

	 	P302
	 	Sidewalk Details
	 	1/1/2004
	13

	 	M101
	 	Striping Plan
	 	3/10/2011
	14

	 	M102
	 	Striping Plan
	 	3/10/2011
	15

	 	M201
	 	City of Denton Standard Signs and Markings General Notes
	 	3/10/2011
	16

	 	M202
	 	City of Denton Standard Signs and Markings General Notes
	 	3/10/2011
	17

	 	M203
	 	City of Denton Sign Details
	 	3/10/2011
	18

	 	M204
	 	City of Denton Pavement Marking Layouts
	 	3/10/2011
	19

	 	D101
	 	Proposed Drainage Area Map
	 	3/10/2011
	20

	 	D102
	 	Inlet & Storm Drain Design Calculations
	 	3/10/2011
	21

	 	D103
	 	Storm Drain Line“A” Plan & Profile
	 	3/10/2011
	22

	 	D104
	 	Storm Drain Line “B” Plan & Profile
	 	3/10/2011
	23

	 	D301
	 	Storm Sewer Details
	 	No date
	24

	 	D302
	 	Storm Sewer Details
	 	No date
	25

	 	D303
	 	Manhole Type M
	 	2/1/2010
	26

	 	U101
	 	12” Water Line Plan
	 	3/10/2011
	27

	 	U102
	 	12” Water Line Plan
	 	3/10/2011
	28

	 	U201
	 	Water Line “W-1” Profile
	 	3/10/2011
	29

	 	U202
	 	Water Line “W-1” Profile
	 	3/10/2011
	30

	 	U203
	 	Water Line “W-1” Profile
	 	3/10/2011
	31

	 	U301
	 	Standard Water Details
	 	No date

 

 

 

	 	 	 	 	 	 	 
	 	 	 	 	 	 	Document
	Sort	 	Page	 	Title	 	Date
	32

	 	U302
	 	Standard Water Details
	 	No date
	33

	 	U303
	 	Standard Water Details
	 	No date
	34

	 	U304
	 	Standard Water/Waster Water Details
	 	No date
	35

	 	U305
	 	Standard Water/Waster Water Details
	 	No date
	36

	 	E001
	 	SWP3 Notes
	 	3/10/2011
	37

	 	E002
	 	SWP3 Notes
	 	3/10/2011
	38

	 	E003
	 	SWP3 Notes
	 	3/10/2011
	39

	 	E101
	 	SWP3 Map
	 	3/10/2011
	40

	 	E102
	 	Erosion Control Plan
	 	3/10/2011
	41

	 	E-103
	 	Erosion Control Plan
	 	3/10/2011
	42

	 	E201
	 	SMP3 Details
	 	3/10/2011
	43

	 	E202
	 	SMP3 Details
	 	3/11/2011
	44

	 	E203
	 	SMP3 Details
	 	3/12/2011
	45

	 	E204
	 	SMP3 Details
	 	3/13/2011
	46

	 	E205
	 	SMP3 Details
	 	3/14/2011
	47

	 	T101
	 	Traffic Control Plan
	 	3/15/2011
	48

	 	T301
	 	Barricade & Construction General Notes and Requirements
	 	9/7/2002
	49

	 	T302
	 	Barricade & Construction Project Limit Standard
	 	9/7/2002
	50

	 	T303
	 	Barricade & Construction Temporary Sign Notes Standard
	 	9/7/2002
	51

	 	T304
	 	Barricade & Construction Typical Sign Support Standard
	 	9/7/2002
	52

	 	T305
	 	Barricade & Construction Channelizing Devices Standard
	 	9/7/2002
	 
	 	 	 	 
	53

	 	Index
	 	Specifications as issued by Weir & Associates, Inc.
	 	No date
	54

	 	 	 	02050 — Demolition	 	 
	55

	 	 	 	02100 — Site Clearing and Preparation	 	 
	56

	 	 	 	02200 — Earthwork	 	 
	57

	 	 	 	02221 — Trenching, Backfilling and Compaction	 	 
	58

	 	 	 	02500 — Storm Drainage System	 	 
	59

	 	 	 	02515 — Portland Cement Concrete Paving	 	 
	60

	 	 	 	02550 — Site Utilities	 	 
	61

	 	 	 	02605 — Separation of Pipe Utilities	 	 
	62

	 	 	 	TPDES Permit Provisions	 	 
	 
	 	 	 	 
	63

	 	 	 	Geotechnical Report as prepared by Reed Engineering
	 	2/18/2011

 

 

 

EXHIBIT C

Surveyor’s Statement

TO: Seller, Purchaser and Title Company

I, the undersigned, being a duly licensed and qualified surveyor in and for the State of
Texas, do hereby state that:

1. I made a survey of the subject property and visible improvements on the
 _____ 
day of

 _____, 20_.

2. This survey correctly represents the property and all visible improvements thereon.

3. I have shown all recorded easements and rights-of-way as described in copies of recorded
instruments furnished to me by the title insurance company named above (with reference to recording
data).

4. Except as otherwise shown: (i) the physical evidence and recorded description of all
easements conform; (ii) all visible improvements, including location and dimensions, are correctly
depicted and are fully completed; (iii) there are no encroachments, rights-of-way across the
subject property, party walls, protrusions onto adjoining properties or streets by any visible
improvements located on the subject property, or encroachments on the subject property by visible
improvements located on adjoining property; (iv) there are no streams, rivers, visible springs,
ponds, lakes, ditches or drains located on, bordering on, or running through the subject property;
and (v) none of the subject property lies within flood hazard areas in accordance with any maps
entitled: “Flood Insurance Rate Map”, “Flood Hazard Floodway Boundary Map”, “Flood Hazard Boundary
Map” or “Flood Boundary and Floodway Map” published by the Federal Emergency Management Agency or a
“Flood Hazard Boundary Map” published by the U.S. Department of Housing and Urban Development.

5. There are no gaps, gores, or overlaps between parcels or roads, highways, streets, or
alleys and all parcels that comprise the subject property are contiguous.

6. The subject property abuts to a dedicated public roadway, and all public roads, highways,
streets, and alleys running adjacent to or upon the subject premises are shown.

7. All physical evidence of boundary lines and lines of possession or occupancy have been
shown and proper notation made where in conflict with the legal description.

8. There are no boundary line discrepancies and no deficiencies in the quantity of the land
described in the legal description of the subject property.

9. This survey was actually made on the ground as per record description furnished by the
title insurance company and is true and correct.

10. This survey conforms with the Texas Society of Professional Surveyors Standards and
Specifications for a Category 1A, Condition II Survey.

 

 

 

EXHIBIT D

Special Warranty Deed

WHEN RECORDED RETURN TO:

Hallett & Perrin, P.C.

Attn: Craig A. Thompson

2001 Bryan Street, Suite 3900

Dallas, Texas 75201

NOTICE OF CONFIDENTIALITY RIGHTS. IF YOU ARE A NATURAL PERSON, YOU MAY REMOVE OR STRIKE ANY OR ALL
OF THE FOLLOWING INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN REAL PROPERTY BEFORE
IT IS FILED FOR RECORD IN THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER’S LICENSE
NUMBER.

SPECIAL WARRANTY DEED

WITH VENDOR’S LIEN

SSAE DEVELOPMENT, LLC, a Texas limited liability company (“Grantor”), whose mailing
address is 2349 Glenda Lane, Dallas, Texas 75229, for and in consideration of the sum of TEN AND
NO/100 DOLLARS ($10.00) and other good and valuable consideration, has GRANTED, BARGAINED, SOLD and
CONVEYED, and by these presents does GRANT, BARGAIN, SELL and CONVEY unto PEERLESS MFG. CO., a
Texas corporation (“Grantee”), whose mailing address is 14651 North Dallas Parkway, Suite
500, Dallas, Texas 75254, that certain real property situated in Denton County, Texas, more
particularly described on Exhibit A attached hereto and made a part hereof for all purposes
(the “Land”), together with: (i) any and all interests of Grantor in any land lying in or
under the bed of any street, alley, road or right-of-way, opened or proposed, abutting or adjacent
to the Land; (ii) any and all leases, rights, privileges, and appurtenances belonging or pertaining
to the Land; (iii) any and all improvements, structures, and fixtures located on, over, and under
the Land (including without limitation any real property improvements owned by Grantor and located
in, on or under the Land or related to, used or available for use in the ownership, conduct,
operation or maintenance of the Property (hereinafter defined); (iv) any and all easements or
rights-of-way affecting the Land and any of rights to use the same; (v) any and all rights of
ingress and egress to and from the Land and any of Grantor’s rights to use the same; (vi) all air
rights, water rights, claims, and permits relating to the Land; (vii) any and all interests of
Grantor in any and all roads (open or proposed) affecting, crossing, fronting, or bounding the
Land, including any awards made or to be made relating thereto including, without limitation, any
unpaid awards or damages payable by reason of damages thereto or by reason of a widening of or
changing of the grade with respect to the same; (viii) reversionary interests in and to the Land;
and (ix) site plans, surveys, soil and substrata studies, engineering plans and studies, and other
plans or studies of any kind that relate to the Property (the Land, together with any and all of
the related improvements, rights, privileges, appurtenances, and interests referenced in items (i)
through (ix) above, are herein collectively referred to as the “Property”).

 

 

 

TO HAVE AND TO HOLD the Property and all improvements thereon, together with all and singular
the rights and appurtenances thereto and in any wise belonging unto the said Grantee, its
successors and assigns, forever; and Grantor does hereby bind Grantor and its successors and
assigns to WARRANT AND FOREVER DEFEND all and singular the Property, unto Grantee, its successors
and assigns, against every person whomsoever lawfully claiming or to claim the same or any part
thereof, by, through or under Grantor, but not otherwise.

This conveyance is made and delivered subject only to those matters of title set forth on
Exhibit B attached hereto and incorporated herein by reference, but only to the extent the
same, in fact, do exist and are applicable to the Property.

GRANTOR CONVEYS THE PROPERTY ON AN “AS IS, WHERE IS” AND “WITH ALL FAULTS”
BASIS, WITHOUT REPRESENTATIONS (OTHER THAN THE LIMITED REPRESENTATIONS SET FORTH IN THE CONTRACT OF
SALE BETWEEN GRANTOR AND GRANTEE), WARRANTIES AND COVENANTS, EXPRESS OR IMPLIED, OF ANY KIND OR
NATURE; PROVIDED, HOWEVER, NOTHING CONTAINED IN THIS PARAGRAPH SHALL LIMIT THE WARRANTIES SET FORTH
IN THIS SPECIAL WARRANTY DEED.

EXECUTED to be effective as of the
 _____ 
day of                     , 2011.

	 	 	 	 	 
	 	GRANTOR:

SSAE DEVELOPMENT, LLC,

a Texas limited liability company

 	 
	 	By:  	 	 
	 	 	Name:  	Scott Schwob 	 
	 	 	Title:  	President 	 
	 

	 	 	 
	STATE OF                     

	 	§
	 

	 	§
	COUNTY OF                     

	 	§

This instrument was acknowledged before me on the
 _____ 
day of                     ,
 _____, by Scott
Schwab, President and SSAE Development, LLC, a Texas limited liability company, on its behalf.

	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Notary Public, State of	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	My Commission Expires:	 	 	 	 
	 

	 	 	 	 	 	 

[SEAL]

 

 

 

EXHIBIT E

Final Plat

[SEE ATTACHMENT]exv4w1

Exhibit 4.1

REGISTRATION RIGHTS AGREEMENT

     This
REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered into as of
this 13th of September, 2011 (the “Effective Date”), by and among Weatherford International
Ltd., a Swiss joint-stock corporation (the “Company”), and the parties set forth on the
signature page hereto (each, a “Shareholder” and collectively, the “Shareholders”).

RECITALS

     WHEREAS, the Shareholders are acquiring Common Shares (defined below) pursuant to the Share
Purchase Agreement dated June 15, 2011 (the “Purchase Agreement”) between, the
Shareholders, Global Drilling Capitales, S.A. de C.V., the Company and Weatherford Holdings México,
S. de R. L. de C. V., an indirect wholly-owned subsidiary of the Company.

     WHEREAS, pursuant to the Purchase Agreement, the Company has agreed to enter into this
Agreement with the Shareholders to set forth the registration rights to be granted by the Company
to the Shareholders, so as to induce the Shareholders to enter into the Purchase Agreement.

     NOW, THEREFORE, in consideration of the mutual promises, representations, warranties,
covenants, and conditions set forth herein and in the Purchase Agreement, the parties mutually
agree as follows:

AGREEMENT

     1. Certain Definitions. As used in this Agreement, the following terms shall have the
following respective meanings:

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

     “Blackout Period” means a period in each case commencing immediately after the Company
notifies the Holders that they are required, pursuant to Section 5, to suspend offers and
sales of Registrable Securities because the Company, in the good faith judgment of its Board of
Directors, determines (because of the existence of, or in anticipation of, any acquisition,
financing activity, or other transaction involving the Company, or the unavailability for reasons
beyond the Company’s control of any required financial statements, disclosure of information which
is in its best interest not to publicly disclose, or any other event or condition of similar
significance to the Company) that the registration and distribution of (and/or the registration of
the offer and sale of) the Registrable Securities would be seriously detrimental to the Company and
its shareholders and ending on the earlier of (1) the date upon which the material non-public
information to which the Blackout Period relates is disclosed to the public or ceases to be
material and (2) such time as the Company allows sales pursuant to the Shelf Registration Statement
to resume; provided, however, that the Company shall (i) not institute a Blackout Period covering
the Prospectus Supplement Filing Date nor any of the first fifteen (15) days immediately following
the Prospectus Supplement Filing Date, and (ii) limit its use of Blackout

 

 

Periods in the aggregate to no more than thirty (30) Trading Days within any twelve (12) month
period.

     “Commission” means the Securities and Exchange Commission or any other federal agency
at the time administering the Securities Act.

     “Common Shares” means the registered shares, par value 1.16 Swiss francs per share, of
the Company and any and all shares of capital stock or other equity securities of: (i) the Company
which are added to or exchanged or substituted for the Common Shares by reason of the declaration
of any stock dividend or stock split, the issuance of any distribution or the reclassification,
readjustment, recapitalization or other such modification of the capital structure of the Company;
and (ii) any other entity, now or hereafter organized under the laws of any state or other
governmental authority, with which the Company is merged, which results from any consolidation or
reorganization to which the Company is a party, or to which is sold all or substantially all of the
shares or assets of the Company.

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

     “Effective Date” has the meaning set forth in the preamble.

     “Effectiveness Period” shall have the meaning set forth in Section 4(a).

     “Exchange Act” means the Securities Exchange Act of 1934, as amended, or any similar
federal statute promulgated in replacement thereof, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.

     “Family Member” means (a) with respect to any individual, such individual’s spouse,
any descendants (whether natural or adopted), any trust all of the beneficial interests of which
are owned by any of such individuals or by any of such individuals together with any organization
described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, the estate of any
such individual, and any corporation, association, partnership or limited liability company all of
the equity interests of which are owned by those above-described individuals, trusts or
organizations and (b) with respect to any trust, the owners of the beneficial interests of such
trust.

     “Holder” means each Shareholder or any of such Shareholder’s successors and Permitted
Assignees who acquire rights in accordance with this Agreement with respect to the Registrable
Securities directly or indirectly from a Shareholder or another Permitted Assignee.

     “Majority Holders” means at any time Holders of a majority of the Registrable
Securities outstanding at such time.

     “Permitted Assignee” means (a) with respect to a partnership, its partners or former
partners in accordance with their partnership interests, (b) with respect to a corporation, its
shareholders or former shareholders (who were shareholders on the Effective Date) in accordance
with their interests in the corporation, (c) with respect to a limited liability company, its
members or former members in accordance with their interests in the limited liability company, (d)
with respect to any other entity, its equityholders or former equityholders in accordance with
their interests in the entity, (e) with respect to an individual person, any Family

2

 

Member of such person, (f) an entity that is controlled by, controls, or is under common
control with a transferor, or (g) a party to this Agreement.

     “Prospectus” means the prospectus used in connection with the Shelf Registration
Statement, including as supplemented by the Prospectus Supplement, all exhibits thereto and all
material incorporated by reference therein.

     “Prospectus Supplement” means the supplement to the Prospectus required to be filed by
the Company pursuant to Section 3.

     “Prospectus Supplement Filing Date” means the same Trading Day on which the Capital
Increase Registration (as defined in the Purchase Agreement) occurs or if the Capital Increase
Registration does not occur on a Trading Day, the first Trading Day thereafter.

     “Purchase Agreement” has the meaning set forth in the recitals.

     “Registrable Securities” means initially that number of Common Shares set forth
opposite each Shareholder’s name on Exhibit A; provided, however, that a Registrable
Security shall cease to be a Registrable Security upon the earlier of the time (a) the Registrable
Security has been sold or disposed of in accordance with the Registration Documents, or (b) such
Registrable Security has been, or can be in a single transaction and without restriction, disposed
of pursuant to any section of Rule 144 (or any similar provision then in force) under the
Securities Act.

     “Registration Documents” shall have the meaning set forth in Section 4.

     “Securities Act” means the Securities Act of 1933, as amended, or any similar federal
statute promulgated in replacement thereof, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.

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

     “Shelf Registration Statement” means that currently existing and effective
registration statement filed by the Company with the Commission on Form S-3 (Commission file number
333-174485) pursuant to Rule 415(a)(1)(i) under the Securities Act, and all amendments and
supplements to such registration statement, including post-effective amendments, all exhibits
thereto and all material incorporated by reference therein.

     “Trading Day” means a day on which the New York Stock Exchange is open for general
trading of securities.

     2. Term. This Agreement shall continue in full force and effect until such time as
there are no Registrable Securities hereunder, unless terminated sooner by agreement of the Company
and an applicable Holder.

     3. Prospectus Supplement. On the Prospectus Supplement Filing Date, the Company shall
file or shall have filed with the Commission the Prospectus Supplement, pursuant

3

 

to Rule 424(b) under the Securities Act, providing for the resale by the Holders of all of the
Registrable Securities.

     4. Registration Procedures. In the case of the filing to be effected by the Company
pursuant to Section 3 hereof, the Company will keep each Holder reasonably advised in
writing (which may include e-mail) as to the completion thereof. At its expense with respect to
the Shelf Registration Statement, the Prospectus and the Prospectus Supplement filed pursuant to
Section 3 (collectively, the “Registration Documents”), the Company will:

     (a) cause the Shelf Registration Statement pertaining to the Registrable Securities to
remain effective under the Securities Act until there are no Registrable Securities
outstanding (the “Effectiveness Period”);

     (b) if any of the Registration Documents become subject to review by the Commission,
promptly respond to all comments and use reasonable best efforts to diligently pursue
resolution of any comments to the satisfaction of the Commission;

     (c) (i) prepare and file with the Commission such amendments, post-effective amendments
and supplements to the Registration Documents, as applicable and as may be necessary to keep
the Shelf Registration Statement continuously effective during the Effectiveness Period, and
notify each Holder of Registrable Securities of when any such amendment or supplement has
been determined to be necessary by the Company, has been filed and becomes effective; and
(ii) comply with the provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by the Prospectus Supplement during such period in accordance
with the intended method(s) of disposition by the sellers thereof set forth in the the
Prospectus as further amended;

     (d) furnish, without charge, to each Holder of Registrable Securities covered by the
Prospectus Supplement (i) a reasonable number of copies of the Shelf Registration Statement
(including any exhibits thereto other than exhibits incorporated by reference), each
amendment, post-effective amendment and supplement thereto as such Holder may request, (ii)
such number of copies of the Prospectus (including each preliminary prospectus and any other
prospectus or any prospectus supplement filed under Rule 424(b) under the Securities Act) as
such Holder may reasonably request, in conformity with the requirements of the Securities
Act, and (iii) such other documents as such Holder may reasonably request that are necessary
to facilitate the disposition of the Registrable Securities owned by such Holder, but only
during the Effectiveness Period;

     (e) use its reasonable best efforts to register or qualify the Registrable Securities
under such other applicable securities or blue sky laws of such jurisdictions as any Holder
of Registrable Securities covered by the Prospectus Supplement reasonably requests as may be
necessary for the marketability of the Registrable Securities and do any and all other acts
and things which may be reasonably necessary or advisable to enable such Holder to
consummate the disposition in such jurisdictions of the Registrable Securities owned by such
Holder; provided that the Company shall not be required to (i) qualify generally to do
business in any jurisdiction where it would not otherwise be

4

 

required to qualify but for this paragraph (e), (ii) subject itself to taxation
in any such jurisdiction, or (iii) consent to general service of process in any such
jurisdiction;

     (f) as promptly as practicable after becoming aware of such event, notify each Holder
of Registrable Securities at any time when a prospectus relating thereto is required to be
delivered under the Securities Act of the happening of any event which comes to the
Company’s attention if as a result of such event any of the Registration Documents contains
an untrue statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, and the Company
shall use its reasonable best efforts to promptly prepare and furnish to each Holder and, if
applicable, file with the Commission under the Securities Act, an amendment, post-effective
amendment or supplement, as applicable, to such documents, or prepare and file appropriate
reports under the Exchange Act, so that, as thereafter delivered to the purchasers of such
Registrable Securities, the Prospectus, as supplemented by the Prospectus Supplement, shall
not contain an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not misleading,
except during the pendency of a Blackout Period, in which case no amendment, post-effective
amendment or supplement need be furnished or Exchange Act filing made until the termination
of the Blackout Period;

     (g) comply, and continue to comply during the period that the Registration Documents
are effective under the Securities Act, in all material respects with the Securities Act and
the Exchange Act and with all applicable rules and regulations of the Commission with
respect to the disposition of all Registrable Securities covered by the Prospectus
Supplement, and generally make available to its security holders, as soon as reasonably
practicable, an earnings statement covering the period of at least twelve (12) months
beginning with the first full calendar month after the Prospectus Supplement Filing Date,
which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act
and Rule 158 thereunder;

     (h) as promptly as practicable after becoming aware of such event, notify each Holder
of Registrable Securities being offered or sold pursuant to the Prospectus Supplement of the
issuance by the Commission of any stop order or other suspension of effectiveness, or any
proceedings that propose any stop order or other suspension of effectiveness, of any of the
Registration Documents at the earliest possible time;

     (i) cause all the Registrable Securities covered by the Prospectus Supplement to be
listed on the New York Stock Exchange or such other principal securities market on which
securities of the same class or series issued by the Company are then listed or traded;

     (j) provide a transfer agent and registrar, which may be a single entity, for the
Registrable Securities at all times;

     (k) cooperate with the Holders of Registrable Securities being offered pursuant to the
Prospectus Supplement to issue and deliver to purchasers of any such Registrable Securities,
Common Shares not bearing any restrictive legends in such

5

 

amounts as the Holders may reasonably request and registered in such names as the
Holders may request;

     (l) during the Effectiveness Period, refrain from bidding for or purchasing any Common
Shares or any right to purchase Common Shares or attempting to induce any Person to purchase
any such security or right if such bid, purchase or attempt would in any way limit the right
of the Holders to sell Registrable Securities by reason of the limitations set forth in
Regulation M under the Exchange Act.

     (m) not institute a Blackout Period covering the Prospectus Supplement Filing Date nor
any of the first fifteen (15) days immediately following the Prospectus Supplement Filing
Date; and

     (n) take such other actions as are reasonably requested by the Holders in order to
facilitate the disposition of Registrable Securities.

     5. Suspension of Offers and Sales. Each Holder of Registrable Securities agrees that,
upon receipt of any notice from the Company of the happening of any event of the kind described in
Section 4(f) or 4(h), or of the commencement of a Blackout Period, such Holder
shall discontinue and suspend any disposition of Registrable Securities pursuant to the
Registration Documents covering such Registrable Securities until such Holder’s receipt of the
copies of the supplemented or amended Prospectus contemplated by Section 4(f) hereof,
notice that any event described in Section 4(h) has been lifted, or notice of the end of
the Blackout Period, as applicable, and, if so directed by the Company, such Holder shall deliver
to the Company (at the Company’s expense) all copies (including, without limitation, any and all
drafts), other than permanent file copies, then in such Holder’s possession, of the Registration
Documents covering such Registrable Securities current at the time of receipt of such notice.

     6. Registration Expenses. Except as set forth in Section 7, the Company shall
pay all expenses in connection with its performance of and compliance with this Agreement, and any
registration of the Registrable Securities, including, without limitation, all registration, filing
and stock exchange fees, all printing and related expenses, all fees and expenses of complying with
state securities or blue sky laws, and the fees and disbursements of counsel for the Company and of
its independent accountants. Except as provided above in this Section 6 and Section
9, the Company shall not be responsible for the expenses of any attorney or other advisor
employed by a Holder of Registrable Securities.

     7. Assignment of Rights. No Holder may assign its rights under this Agreement to any
party without the prior written consent of the Company; provided, however, that a Holder may assign
its rights under this Agreement without such prior written consent to a Permitted Assignee as long
as (a) such transfer or assignment is effected in accordance with applicable securities laws; (b)
such transferee or assignee agrees in writing to become subject to the terms of this Agreement; and
(c) the Company is given written notice by such Holder of such transfer or assignment, stating the
name and address of the transferee or assignee and identifying the Registrable Securities with
respect to which such rights are being transferred or assigned. The Company shall use its
reasonable best efforts, upon request of the transferring Holder and its Permitted Assignee (and
after receiving such transfer notice, joinder and the information

6

 

required by this Section 7 and Section 8 as to the Permitted Transferee), to
file an amendment or supplement to the Prospectus Supplement to provide for the resale of
Registrable Securities by such Permitted Assignees and shall bear any and all expenses incurred by
the Company in connection with the first two amendments or supplements so requested by each such
Holder and its Permitted Transferees. A Holder shall pay any and all expenses incurred by the
Company in connection with any subsequent amendments or supplements so requested by each such
Holder, including, without limitation, the reasonable fees and disbursements of the Company’s
counsel, accountants, and other representatives incurred in connection therein.

     8. Information by Holder. The Holder or Holders of Registrable Securities included in
any Prospectus Supplement shall furnish to the Company such information regarding such Holder or
Holders and the distribution proposed by such Holder or Holders as the Company may reasonably
request. No Holder of Registrable Securities will be entitled to have such Registrable Securities
included in the Prospectus Supplement if such Holder does not furnish the information requested by
the Company. Each Holder agrees that the name and address of such Holder as it is to be listed in
the Prospectus Supplement, and the number of Registrable Securities of such Holder to be included
in the Prospectus Supplement, is accurately set forth on Exhibit A attached to this
Agreement.

     9. Indemnification.

          (a) In the event of the offer and sale of Registrable Securities held by Holders under the
Securities Act, the Company shall, and hereby does, indemnify and hold harmless, to the fullest
extent permitted by law, each Holder, each Holder’s directors, officers, partners and
equityholders, each other person who participates as an underwriter or broker in the offering or
sale of the Registrable Securities, and each other person, if any, who controls or is under common
control with each Holder or any such underwriter or broker within the meaning of Section 15 of the
Securities Act, against any losses, claims, damages, liabilities and expenses, joint or several, to
which any Holder or any such director, officer, partner, equityholder, underwriter or broker or
controlling or controlled person may become subject under the Securities Act, the Exchange Act or
state securities laws and regulations or otherwise, insofar as such losses, claims, damages,
liabilities and expenses (or actions or proceedings, whether commenced or threatened, in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of any
material fact contained in the Shelf Registration Statement, the Prospectus (including any
preliminary prospectus, final prospectus or summary prospectus), or any amendment, post-effective
amendment or supplement thereto, including the Prospectus Supplement, or any omission or alleged
omission to state therein a material fact required to be stated therein or necessary to make the
statements therein (in the case of any prospectus, in light of the circumstances in which they were
made) not misleading, or (ii) any violation or alleged violation by the Company of the Securities
Act, the Exchange Act or any state securities laws and regulations, and the Company shall reimburse
each Holder, and each such director, officer, partner, equityholder, underwriter, broker and
controlling or controlled person, for any legal or any other expenses reasonably incurred by them
in connection with investigating, defending or settling any such loss, claim, damage, liability,
expense, action or proceeding; provided that the Company shall not be liable in any such case (i)
to the extent that any such loss, claim, damage, liability or expense (or action or proceeding in
respect thereof) arises out of or is based upon (x) an untrue statement or alleged untrue statement
in or omission

7

 

or alleged omission from the Shelf Registration Statement, the Prospectus (including any such
preliminary prospectus, final prospectus or summary prospectus), or any amendment, post-effective
amendment or supplement thereto, including the Prospectus Supplement, was made in reliance upon and
in conformity with written information furnished to the Company through an instrument duly executed
by or on behalf of a Holder specifically stating that it is for use in the preparation therefor or
(y) such Holder’s failure to comply with the terms of the plan of distribution mechanics described
in the applicable prospectus, or (ii) if the person asserting any such loss, claim, damage,
liability or expense (or action or proceeding in respect thereof) who purchased the Registrable
Securities that are the subject thereof did not receive a copy of the most current Prospectus at or
prior to the written confirmation of the sale of such Registrable Securities to such person because
of the failure of a Holder or underwriter to so provide the most current Prospectus and the untrue
statement or alleged untrue statement or omission or alleged omission of a material fact made in
such Prospectus was corrected in the most current Prospectus Supplement. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on behalf of any Holder,
or any such director, officer, partner, equityholder, underwriter, broker or controlling or
controlled person and shall survive the transfer of such shares by a Holder.

          (b) As a condition to including any Registrable Securities to be offered by a Holder in the
Prospectus Supplement filed pursuant to this Agreement, each Holder agrees to be bound by the terms
of this Section 9 and to indemnify and hold harmless, to the fullest extent permitted by
law, the Company, its directors, officers, employees and agents, and each other person, if any, who
controls or is under common control with the Company within the meaning of Section 15 of the
Securities Act, against any losses, claims, damages or liabilities, joint or several, to which the
Company or any such director, officer, employee, agent, or controlling or controlled person may
become subject under the Securities Act, the Exchange Act or state securities laws and regulations,
insofar as such losses, claims, damages or liabilities (or actions or proceedings, whether
commenced or threatened, in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained in the Shelf Registration
Statement, the Prospectus (including any preliminary prospectus, final prospectus or summary
prospectus), or any amendment, post-effective amendment or supplement thereto, including the
Prospectus Supplement, or any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein (in the case of any
prospectus, in light of the circumstances in which they were made) not misleading, if such untrue
statement or alleged untrue statement in or omission or alleged omission was made in reliance upon
and in conformity with written information furnished to the Company through an instrument duly
executed by or on behalf of such Holder specifically stating that it is for use in the preparation
therefor, or (ii) such Holder’s failure to comply with the terms of the plan of distribution
mechanics described in the applicable prospectus, and such Holder shall reimburse the Company, and
each such director, officer, employee, agent and controlling or controlled person, for any legal or
other expenses reasonably incurred by them in connection with investigating, defending, or settling
any such loss, claim, damage, liability, action, or proceeding; provided, however, that such
indemnity found in this Section 9(b) shall in no event exceed the gross proceeds from any
offering received by such Holder. Such indemnity shall remain in full force and effect, regardless
of any investigation made by or on behalf of the Company or any such director, officer, employee,
agent or controlling or controlled person and shall survive the transfer by any Holder of such
shares.

8

 

          (c) Promptly after receipt by an indemnified party of notice of the commencement of any action
or proceeding involving a claim referred to in Section 9(a) or (b) hereof
(including any governmental action), such indemnified party shall, if a claim in respect thereof is
to be made against an indemnifying party, give written notice to the indemnifying party of the
commencement of such action or proceeding; provided that the failure of any indemnified party to
give notice as provided herein shall not relieve the indemnifying party of its obligations under
Section 9(a) or (b) hereof, except to the extent that the indemnifying party is
actually prejudiced by such failure to give notice. In case any such action is brought against an
indemnified party, unless in the reasonable judgment of counsel to such indemnified party a
conflict of interest between such indemnified and indemnifying parties may exist or the indemnified
party may have defenses not available to the indemnifying party in respect of such claim, the
indemnifying party shall be entitled to participate in and to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party and, after notice from the indemnifying
party to such indemnified party of its election so to assume the defense thereof, the indemnifying
party shall not be liable to such indemnified party for any legal or other expenses, other than
reasonable costs of investigation, subsequently incurred by the latter in connection with the
defense thereof, unless in such indemnified party’s reasonable judgment a conflict of interest
between such indemnified and indemnifying parties arises in respect of such claim after the
assumption of the defenses thereof or the indemnifying party fails to defend such claim in a
diligent manner. Neither an indemnified nor an indemnifying party shall be liable for any
settlement of any action or proceeding effected without its consent. No indemnifying party shall,
without the consent of the indemnified party, consent to entry of any judgment or enter into any
settlement, which does not include as an unconditional term thereof the giving by the claimant or
plaintiff to such indemnified party of a release from all liability in respect of such claim or
litigation. Notwithstanding anything to the contrary set forth herein, and without limiting any of
the rights set forth above, in any event any party shall have the right to retain, at its own
expense, counsel with respect to the defense of a claim.

          (d) In the event that an indemnifying party does not assume or is not permitted to assume the
defense of an action pursuant to Section 9(c) or in the case of the expense reimbursement
obligation set forth in Section 9(a) and (b), the indemnification required by
Section 9(a) and (b) hereof 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, losses, damages, or liabilities are incurred.

          (e) If the indemnification provided for in this Section 9 is held by a court of
competent jurisdiction to be unavailable to an indemnified party with respect to any loss,
liability, claim, damage or expense referred to herein, the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such loss, liability, claim, damage or expense (i) as is
appropriate to reflect the proportionate relative fault of the indemnifying party on the one hand
and the indemnified party on the other (determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the indemnifying party or the indemnified party
and the parties’ relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission), or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law or provides a lesser sum to the indemnified party
than the

9

 

amount hereinafter calculated, as is appropriate to reflect not only the proportionate
relative fault of the indemnifying party and the indemnified party, but also the relative benefits
received by the indemnifying party on the one hand and the indemnified party on the other, as well
as any other relevant equitable considerations; provided, however, that each Holder shall not be
liable for any such loss, liability, claim, damage or expense in an amount greater than such Holder
received as gross proceeds from the sale of such Holder’s Registrable Securities. No indemnified
party guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any indemnifying party who was not guilty of such
fraudulent misrepresentation.

          (f) Indemnification similar to that specified in the preceding subsections of this Section
9 (with appropriate modifications) shall be given by the Company and each Holder of Registrable
Securities with respect to any required registration or other qualification of securities under any
federal or state law or regulation or governmental authority other than the Securities Act.

     10. Rule 144. Until the earlier of (i) the disposition of all Registrable Securities
covered by the Prospectus Supplement and (ii) the first anniversary of the Prospectus Supplement
Filing Date, the Company shall (a) timely (including any extensions allowed under the Securities
Act, the Exchange Act and the rules and regulations adopted by the Commission thereunder) file all
reports required to be filed by the Company after the date hereof under the Securities Act and the
Exchange Act (including the reports pursuant to Section 13(a) or 15(d) of the Exchange Act referred
to in subparagraph (c)(1) of Rule 144) and the rules and regulations adopted by the Commission
thereunder), (b) if the Company is not required to file reports pursuant to such sections, it will
prepare and furnish to the Holders and make publicly available in accordance with Rule 144(c) such
information as is required for the Holders to sell Common Shares under Rule 144, and (c) furnish to
any Holder, so long as the Holder owns any Registrable Securities, forthwith upon request (i) a
written statement by the Company that it has complied with the reporting requirements of Rule 144,
the Securities Act and the Exchange Act, (ii) a copy of the most recent annual or quarterly report
of the Company and such other reports and documents so filed by the Company if not otherwise
publicly available on EDGAR, and (iii) such other information as may be reasonably requested to
avail any Holder of any rule or regulation of the Commission that permits the selling of any such
securities without registration, as may be necessary and all to the extent required from time to
time to enable the Holders to sell Common Shares without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144, including causing its attorneys to
issue and deliver any appropriate legal opinion required to permit a Holder to sell Common Shares
under Rule 144 upon receipt of appropriate documentation relating to such sale.

     11. Independent Nature of each Shareholder’s Obligations and Rights. The obligations
of each Shareholder under this Agreement are several and not joint with the obligations of any
other Shareholder, and each Shareholder shall not be responsible in any way for the performance of
the obligations of any other Shareholder under this Agreement. The decision of each Shareholder to
acquire Common Shares and enter into this Agreement has been made by each Shareholder independently
of any other Shareholder. Nothing contained herein, and no action taken by any Shareholder
pursuant hereto, shall be deemed to constitute the Shareholders as a partnership, an association, a
joint venture, or any other kind of entity, or

10

 

create a presumption that the Shareholders are in any way acting in concert or as a group with
respect to such obligations or the transactions contemplated by this Agreement. Each Shareholder
acknowledges that no other Shareholder has acted as agent for the Shareholder in connection with
making its investment in Common Shares and that no other Shareholder will be acting as agent of the
Shareholder in connection with monitoring its investment in the Common Shares or enforcing its
rights under this Agreement. Each Shareholder shall be entitled to independently protect and
enforce its rights, including without limitation the rights arising out of this Agreement, and it
shall not be necessary for any other Shareholder to be joined as an additional party in any
proceeding for such purpose.

     12. Miscellaneous.

          (a) Governing Law. This Agreement and the rights of the parties hereunder shall be
governed by, and construed in accordance with, the laws of the State of Texas and the United States
of America without regard to the conflicts of law provisions thereof that would cause the laws of
any other jurisdiction to apply. Any judicial proceeding brought against any of the parties to this
Agreement or any dispute arising out of this Agreement or any matter related hereto shall be
brought in the courts of the State of Texas, City of Houston, or in the United States District
Court for the Southern District of Texas and, by its execution and delivery of this Agreement, each
party to this Agreement accepts the jurisdiction of such courts. The foregoing consent to
jurisdiction shall not be deemed to confer rights on any person other than the parties to this
Agreement.

          (b) Successors and Assigns. Except as otherwise provided herein, the provisions
hereof shall inure to the benefit of, and be binding upon, the successors, Permitted Assignees,
executors and administrators of the parties hereto. In the event the Company merges with, or is
otherwise acquired by, a direct or indirect subsidiary of a publicly traded company, the Company
shall condition the merger or acquisition on the assumption by such parent or successor company of
the Company’s obligations under this Agreement.

          (c) Entire Agreement. This Agreement constitutes the full and entire understanding
and agreement between the parties with regard to the subjects hereof.

          (d) Notices, etc. All notices or other communications under this Agreement shall be in
writing and sufficient if delivered by (i) personal delivery, (ii) facsimile transmission, (iii)
registered or certified mail, postage pre-paid, return receipt requested, (iv) electronic mail, or
(v) courier or overnight carrier, to the persons at the addresses set forth below (or at such other
address as may be provided hereunder), and shall be deemed to have been delivered as of the date so
delivered:

	 	 	 

	If to the Company:

	 	Weatherford International Ltd.
	 

	 	515 Post Oak Blvd., Suite 1100
	 

	 	Houston, Texas 77027
	 

	 	Attention: General Counsel
	 

	 	Facsimile: (713) 693-4484
	 

	 	Confirm: (713) 693-4000
	 

	 	Email: Joseph.Henry@weatherford.com

11

 

	 	 	 

	If to a Shareholder:

	 	To such Shareholder at the address
set forth on Exhibit A
	 
	 	 
	with a copy (which shall not itself 

constitute notice) to:

	 	Proskauer Rose LLP

11 Times Square
	 

	 	New York, NY 10036
	 

	 	Attention: Carlos E. Martinez, Esq.
	 

	 	Facsimile: (212) 969-2900
	 

	 	Confirm: (212) 969-3160
	 

	 	e-mail: cmartinez@proskauer.com

or at such other address as any party shall have furnished to the other parties in writing.

          (e) Delays or Omissions. No delay or omission to exercise any right, power or remedy
accruing to any Holder of any Registrable Securities, upon any breach or default of the Company
under this Agreement, shall impair any such right, power or remedy of such Holder nor shall it be
construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any
similar breach or default thereunder occurring; nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any Holder of any
breach or default under this Agreement, or any waiver on the part of any Holder of any provisions
or conditions of this Agreement, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this Agreement, or by law or
otherwise afforded to any Holder, shall be cumulative and not alternative.

          (f) Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be enforceable against the parties actually executing such counterparts, and all of
which together shall constitute one instrument.

          (g) Severability. If any provision of this Agreement shall be declared by a court of
competent jurisdiction to be invalid, illegal or unenforceable, the remaining provisions shall not
in any way be affected or impaired thereby and shall remain in full force and effect.

          (h) Amendments. The provisions of this Agreement may be amended at any time and from
time to time, and particular provisions of this Agreement may be waived, with and only with an
agreement or consent in writing signed by the Company and by the Majority Holders; provided,
however, that no such amendment may impair the rights of a Holder without that Holder’s consent nor
may such Holder’s obligations hereunder be expanded without such Holder’s consent.

12

 

     IN WITNESS WHEREOF, this Registration Rights Agreement is hereby executed as of the date first
above written.

	 	 	 	 	 
	 	COMPANY:

WEATHERFORD INTERNATIONAL LTD.,

a Swiss joint-stock corporation

 	 
	 	By:  	/s/ Joseph C. Henry
 	 
	 	 	Joseph C. Henry 	 
	 	 	Vice President,

Co-General Counsel and Secretary 	 
	 

Signature Page to Registration Rights Agreement

 

 

	 	 	 	 	 
	 	SHAREHOLDERS:

 	 
	 	/s/ Jose Eduvigildo Carranza Beltran
 	 
	 	Jose Eduvigildo Carranza Beltran 	 
	 	 	 
	 
	 	 	 
	 	                                      /s/ Alfredo Jose Coppel Salcido
 	 
	 	Alfredo Jose Coppel Salcido 	 
	 	 	 
	 
	 	 	 
	 	                                      /s/ Jesus Alberto Humaran Castellanos
 	 
	 	Jesus Alberto Humaran Castellanos 	 
	 	 	 
	 
	 	 	 
	 	                                      /s/ Bertha Alicia Peñuñuri Soto
 	 
	 	Bertha Alicia Peñuñuri Soto 	 
	 	 	 
	 
	 	 	 
	 	                                      /s/ Jorge Manuel Esteban Ayala
 	 
	 	Jorge Manuel Esteban Ayala 	 
	 	 	 
	 

Signature Page to Registration Rights Agreement

 

 

EXHIBIT A

SHAREHOLDER INFORMATION

	 	 	 	 	 
	 	 	 	 	Number of Registrable
	Name	 	Address	 	Securities
	Jose Eduvigildo Carranza
Beltran

	 	Av. Puerto de Mazatlan #406 (Bonfil) 

Mazatlan, Sinaloa 82050 Mexico 

Email:
	 	3,594,357
	 
	 	 	 	 
	Alfredo Jose Coppel Salcido

	 	Paseo de Tamarindos #105 Depto.13

Col. Bosques De Las Lomas 

Mexico, Distrito Federal 11700

Email:
	 	372,816
	 
	 	 	 	 
	Jesus Alberto Humaran
Castellanos

	 	Rafael Dominguez #308

Col. Palos Prietos 

Mazatlan, Sinaloa 82010 Mexico 

Email:
	 	232,684
	 
	 	 	 	 
	Bertha Alicia Peñuñuri Soto

	 	Ave. Del Mar 2028-1303

Mazatlan, Sinaloa 82017 Mexico 

Email:
	 	232,684
	 
	 	 	 	 
	Jorge Manuel Esteban Ayala

	 	Calle 31 A #7 Fracc. Justo Sierra 

Ciudad Del Carmen, Campeche 24100
Mexico 

Email:
	 	221,138

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