Document:

First Supplemental Indenture dated as of March 31, 2010

 Exhibit 4.2 
 FIRST SUPPLEMENTAL INDENTURE 
 by and among 

 FLOTEK INDUSTRIES, INC. 
 AS ISSUER, 
 THE GUARANTORS PARTY HERETO 
 AND 
 U.S.
BANK NATIONAL ASSOCIATION 
 AS TRUSTEE 
 5.25% Convertible Senior Secured Notes due 2028 
  
  
 Dated as of
March 31, 2010 
  
  
 Supplemental To Indenture For Senior Secured Debt Securities 
 Dated as of March 31, 2010 

 TABLE OF CONTENTS 
  
  
  

							
	 	 	 	  	 	  	PAGE
	Article 1 Definitions and Incorporation by Reference	  	2
				
		 	Section 1.01.	  	Scope of First Supplemental Indenture	  	2
		 	Section 1.02.	  	Definitions	  	2
		 	Section 1.03.	  	Other Definitions	  	12
		 	Section 1.04.	  	Rules of Construction	  	13
		
	Article 2 The Securities	  	13
				
		 	Section 2.01.	  	Title; Amount and Issue of Securities; Principal and Interest	  	13
		 	Section 2.02.	  	Form of Securities; Authentication	  	14
		 	Section 2.03.	  	Legends	  	15
		 	Section 2.04.	  	Registrar and Paying Agent	  	16
		 	Section 2.05.	  	General Provisions Relating to Transfer and Exchange	  	16
		 	Intentionally Omitted	  	17
		 	Section 2.07.	  	Original Issue Discount	  	17
		
	Article 3 Covenants	  	17
				
		 	Section 3.01.	  	Payment of Securities	  	17
		 	Section 3.02.	  	Further Instruments and Acts	  	17
		 	Section 3.03.	  	Statement by Officer as to Default; Trading Price of Securities	  	17
		 	Section 3.04.	  	Additional Interest and Contingent Interest	  	18
		 	Section 3.05.	  	Calculation Of Original Issue Discount	  	18
		 	Section 3.06.	  	Limitation on Liens	  	18
		
	Article 4 Redemption of Securities	  	19
				
		 	Section 4.01.	  	Optional Redemption	  	19
		 	Section 4.02.	  	Selection by Trustee of Securities to Be Redeemed	  	19
		 	Section 4.03.	  	Notice of Redemption	  	19
		
	Article 5 Defaults and Remedies	  	20
				
		 	Section 5.01.	  	Additional Events of Default	  	20
		 	Section 5.02.	  	Sole Remedy for Failure to Report	  	21
		 	Section 5.03.	  	Limitation on Suits	  	22
		
	Article 6 Discharge of Indenture	  	22
				
		 	Section 6.01.	  	Discharge of Liability on Securities	  	22
		 	Section 6.02.	  	Reinstatement	  	23
		 	Section 6.03.	  	Officer’s Certificate; Opinion of Counsel	  	23
		
	Article 7 Amendments	  	24
				
		 	Section 7.01.	  	Without Consent of Holders	  	24
		 	Section 7.02.	  	With Consent of Holders	  	24
		
	Article 8 Purchase at the Option of Holders Upon a Fundamental Change; Purchase at the Option of Holders	  	25
				
		 	Section 8.01.	  	Purchase at the Option of the Holder Upon a Fundamental Change	  	25
		 	Section 8.02.	  	Purchase of Securities at the Option of the Holder	  	27

  

 ii 

							
		 	Section 8.03.	  	Further Conditions and Procedures for Purchase at the Option of the Holder Upon a Fundamental Change and Purchase of Securities at the Option of the Holder	  	28
		
	Article 9 Conversion	  	31
				
		 	Section 9.01.	  	Conversion of Securities	  	31
		 	Section 9.02.	  	Adjustments to Conversion Rate	  	37
		 	Section 9.03.	  	Adjustment to Common Stock Delivered Upon Certain Fundamental Changes	  	43
		 	Section 9.04.	  	Effect of Recapitalizations, Reclassifications, and Changes of Common Stock	  	44
		 	Section 9.05.	  	Responsibility of Trustee	  	45
		 	Section 9.06.	  	Stockholder Rights Plan	  	46
		 	Section 9.07.	  	No Stockholder Rights	  	46
		 	Section 9.08.	  	Withholding Taxes for Adjustments in Conversation Rate	  	46
		
	Article 10 Guarantee of Securities	  	46
				
		 	Section 10.01.	  	Securities Guarantee	  	46
		 	Section 10.02.	  	Release of A Guarantor; Termination Of Securities Guarantee	  	46
		
	ARTICLE 11 Security Documents	  	47
				
		 	Section 11.01.	  	Collateral and Security Documents	  	47
		 	Section 11.02.	  	Recording and Opinions	  	47
		 	Section 11.03.	  	Release of Collateral	  	48
		 	Section 11.04	  	Certificates of the Company	  	49
		 	Section 11.05.	  	Permitted Releases Not to Impair Lien; Trust Indenture Act Requirements	  	50
		 	Section 11.06.	  	Certificate of the Trustee	  	50
		 	Section 11.07.	  	Enforcement of Security Documents and Protection of Collateral	  	51
		 	Section 11.08.	  	Authorization of Receipt of Funds by Trustee Under the Security Documents	  	51
		 	Section 11.09.	  	Collateral Agent	  	51
		 	Section 11.10.	  	Designations	  	52
		 	Section 11.11.	  	Termination of Liens	  	52
		 	Section 11.12.	  	Excluded Securities	  	52
		 	Section 11.13.	  	Automatic Waiver of Covenants in Security Documents	  	52
		
	Article 12 Miscellaneous	  	53
				
		 	Section 12.01.	  	Compliance with Trust Indenture Act	  	53
		 	Section 12.02.	  	No Defeasance	  	53
		 	Section 12.03.	  	Communication by Holders with other Holders	  	53
		 	Section 12.04.	  	Rules by Trustee, Paying Agent and Registrar	  	53
		 	Section 12.05.	  	Governing Law	  	53
		 	Section 12.06.	  	No Recourse Against Others	  	53
		 	Section 12.07.	  	Successors	  	53
		 	Section 12.08.	  	Multiple Originals	  	53
		 	Section 12.09.	  	Table of Contents; Headings	  	53
		 	Section 12.10.	  	Severability Clause	  	53
		 	Section 12.11.	  	Calculations	  	54
		 	Section 12.12.	  	Ratification and Incorporation of Original Indenture	  	54
		
	EXHIBIT A Form of the Security	  	

  

 iii 

 FIRST SUPPLEMENTAL INDENTURE dated as of March 31, 2010, among Flotek Industries, Inc.,
a Delaware corporation (the “Company”), the guarantors listed on the signature page hereto (the “Initial Guarantors”) and U.S. Bank National Association, as Trustee (the “Trustee”). 
 Each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of the Company’s
5.25% Convertible Senior Secured Notes due 2028 (the “Securities”). 
 W I T N E S S E T H: 
 WHEREAS, this First Supplemental Indenture is supplemental to the Original Indenture. 
 WHEREAS, for its lawful corporate purposes, the Company has duly authorized the issue of the Securities, in an aggregate principal amount
not to exceed $36,004,000, and in order to provide the terms and conditions upon which the Securities are to be authenticated, issued and delivered, the Company has duly authorized the execution and delivery of this First Supplemental Indenture.

 WHEREAS, pursuant to Section 3.1 of the Original Indenture, the Company may establish one or more series of Securities
from time to time as authorized by a supplemental indenture of which the Securities shall be one such series. 
 WHEREAS, the
Form of Security, the certificate of authentication to be borne by each Security, the Form of Conversion Notice, the Form of Fundamental Change Purchase Notice, the Form of Purchase Notice and the Assignment Form to be borne by the Securities are to
be substantially in the forms hereinafter provided for. 
 WHEREAS, all acts and things necessary to make the Securities, when
executed by the Company and authenticated and delivered by the Trustee or a duly authorized authenticating agent, as in the Indenture provided, the valid, binding and legal obligations of the Company, and to constitute these presents a valid
agreement according to its terms, have been done and performed, and the execution of this First Supplemental Indenture and the issue hereunder of the Securities have in all respects been duly authorized. 
 WHEREAS, the Guarantors party hereto have duly authorized the execution and delivery of this First Supplemental Indenture as guarantors of
the Securities. All things necessary to make the Indenture a valid agreement of each Guarantor, in accordance with its terms, have been done, and each Guarantor has done all things necessary to make the Securities Guarantee, when the Securities are
executed by the Company and authenticated and delivered by the Trustee and duly issued by the Company, the valid obligations of such Guarantor as hereinafter provided. 

 NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH: 
 That in order to declare the terms and conditions upon which the Securities are, and are to be, authenticated, issued and delivered, and in
consideration of the premises and of the purchase and acceptance of the Securities by the holders thereof, the Company and the Guarantors covenant and agree with the Trustee for the equal and proportionate benefit of the respective holders from time
to time of the Securities (except as otherwise provided below), as follows: 
 ARTICLE 1 
 DEFINITIONS AND INCORPORATION BY REFERENCE 
 Section 1.01. Scope of First Supplemental Indenture. The changes, modifications and supplements to the Original Indenture
affected by this First Supplemental Indenture shall be applicable only with respect to, and shall only govern the terms of, the Securities, which shall be limited to $36,004,000 aggregate principal amount Outstanding and which shall be issued on the
Issue Date, and shall not apply to any other Securities that may be issued under the Original Indenture. The provisions of the First Supplemental Indenture shall supersede any corresponding or inconsistent provisions in the Original Indenture.

 Section 1.02. Definitions. The terms defined in this Section 1.02 (except as herein otherwise expressly
provided or unless the context otherwise requires) for all purposes of this First Supplemental Indenture and for purposes of the Original Indenture as it relates to the Securities shall have the respective meanings specified in this
Section 1.02. Except as otherwise provided in this First Supplemental Indenture, all words, terms and phrases defined in the Original Indenture (but not otherwise defined herein) shall have the same meaning herein as in the Original Indenture.
All other terms used in this First Supplemental Indenture that are defined in the Trust Indenture Act or that are by reference therein defined in the Securities Act (except as herein otherwise expressly provided or unless the context otherwise
requires) shall have the meanings assigned to such terms in said Trust Indenture Act and in said Securities Act as in force at the date of the execution of this First Supplemental Indenture. The words “herein,” “hereof,”
“hereunder,” and words of similar import refer to this First Supplemental Indenture as a whole and not to any particular Article, Section or other subdivision. 
 “Accredited Investors” means an “accredited investor” as described in Rule 501 under the Securities Act. 
 “Additional Interest” means all amounts, if any, payable pursuant to Section 5.02 hereof. 
 “Beneficial Owner” shall mean any Person who is considered a beneficial owner of a security in accordance with
Rule 13d-3 promulgated by the SEC under the Exchange Act. 
 “Beneficial Ownership Limitation” shall mean,
for purposes of determining the extent to which any Holder’s right to convert its Securities into shares of Common Stock is limited by Section 9.01(h), 9.99% of the sum of (i) the number of shares of Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock upon such conversion, plus (ii) the number of shares of Common Stock the beneficial ownership of which such Holder (together with such Holder’s Affiliates and any
other Persons acting as a group together with such Holder or any of such Holder’s Affiliates) has the right to acquire within 60 days (other than upon such conversion). For purposes of the foregoing sentence, beneficial ownership shall be
determined in accordance with Section 13(d) of the Exchange Act and the

  

 2 

 
rules and regulations promulgated thereunder. A Holder, upon not less than 61 days’ prior written notice to the Company, may increase or decrease the Beneficial Ownership Limitation as it
applies to such Holder, provided that any such increase or decrease will not be effective until the 61st day after such notice is delivered to the Company. 
 “Bid Solicitation Agent” means, initially, the Trustee. The Company may change the Bid Solicitation Agent, but the Bid Solicitation Agent shall not be the Company’s Affiliate. The
Bid Solicitation Agent shall solicit bids from securities dealers in accordance with Section 9.01 that are believed by the Company to be willing to bid for the Securities. 
 “Capital Stock” of any Person means any and all shares, interests, rights to purchase, warrants, options, participations or
other equivalents of or interests in (however designated) equity of such Person, including any Preferred Stock, but excluding any debt securities convertible into such equity. 
 “Collateral” means all the collateral provided for and described in the Security Documents. 
 “Collateral Agent” means the Trustee in its capacity as collateral agent under the Security Documents, and any successor
thereto in such capacity. 
 “Common Equity” of any Person means Capital Stock of such Person that is generally
entitled to (1) vote in the election of directors of such Person or (2) if such Person is not a corporation, vote or otherwise participate in the selection of the governing body, partners, managers or others that will control the
management or policies of such Person. 
 “Common Stock” means the Company’s common stock, par value
$0.0001 per share at the date of this First Supplemental Indenture or, subject to Section 9.04, shares of any class or classes resulting from any reclassification or reclassifications thereof and that have no preference in respect of dividends
or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and that are not subject to redemption by the Company; provided that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable shall be substantially in the proportion which the total number of shares of such class resulting from all such reclassifications bears to the total number of shares of all such classes
resulting from all such reclassifications. 
 “Contingent Interest” has the meaning set forth in Exhibit A
attached hereto. 
 “Conversion Agent” means the office or agency appointed by the Company where Securities may
be presented for conversion. The Conversion Agent appointed by the Company shall initially be the Trustee. 
 “Conversion Period” means, with respect to any Securities: 
 (i)
with respect to any Conversion Date that occurs on or after the 25th Scheduled Trading Day prior to the Maturity Date, the 20 consecutive VWAP Trading Day period beginning on and including the 22nd Scheduled Trading Day prior to the Maturity Date (whether or not the Maturity Date is a Scheduled Trading Day) (or if
such day is not a VWAP Trading Day, the next succeeding VWAP Trading Day); 
  

 3 

 (ii) with respect to any Securities called for
redemption, the 20 consecutive VWAP Trading Day Period beginning on and including the 22nd Scheduled Trading Day prior to the Redemption Date (or if such day is not a VWAP Trading Day, the next succeeding VWAP Trading Day); and 
 (iii) in all other instances, the 20 consecutive VWAP Trading Day period beginning on and including the third VWAP Trading
Day after the related Conversion Date in respect of such Securities. 
 “Conversion Price” at any time means a
dollar amount (initially $22.75) equal to $1,000 divided by the Conversion Rate at such time. 
 “Credit
Agreement” means the Amended and Restated Credit Agreement dated as of March 31, 2010 among the Company, as borrower, Whitebox Advisors LLC, as administrative agent, and the lenders named therein, as amended, restated, supplemented,
waived, or replaced (whether or not upon termination, and whether with the original lenders or otherwise), refinanced, restructure or otherwise modified from time to time. 
 “Credit Agreement Indebtedness” means Debt and other obligations Incurred or arising under or in respect of the Credit
Agreement, including principal, premium (if any), interest (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company whether or not a claim for post-filing interest is allowed in
such proceedings), fees, charges, expenses, reimbursement obligations, guarantees and all other amounts payable thereunder or in respect thereof. 
 “Credit Facilities Collateral Agent” means Whitebox Advisors LLC, in its capacity as administrative agent for the lenders party to the Credit Agreement, or any successor thereto in such
capacity, or any Person otherwise designated the “Credit Facilities Collateral Agent” pursuant to the Intercreditor Agreement. 
 “Daily Conversion Value” means, for each of the 20 consecutive VWAP Trading Days during the Conversion Period, one-twentieth (1/20) of the product of (a) the Conversion Rate on
such day and (b) the Daily VWAP of the Common Stock (or the Reference Property pursuant to Section 9.04) on such VWAP Trading Day. 
 “Daily Settlement Amount” means, for each of the 20 VWAP Trading Days during the applicable Conversion Period: 
 (i) cash equal to the lesser of $50.00 and the Daily Conversion Value relating to such VWAP Trading Day; and 
 (ii) if such Daily Conversion Value exceeds $50.00, a number of shares of Common Stock equal to (A) the difference
between such Daily Conversion Value and $50.00, divided by (B) the Daily VWAP of the Common Stock (or the consideration into which Common Stock has been exchanged in connection with certain corporate transactions) for such VWAP Trading Day,
subject to adjustment pursuant to Section 9.02(l). 
  

 4 

 “Daily VWAP” means for each of the 20 consecutive VWAP Trading Days during
the Conversion Period, the per share volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg page FTK.UQ <equity> AQR (or any equivalent successor page) in respect of the period from the scheduled
open of trading on the principal trading market for the Common Stock to the scheduled close of trading on such market on such VWAP Trading Day (or if such volume-weighted average price is unavailable, the market value of one share of Common Stock on
such VWAP Trading Day, using a volume-weighted method if reasonably practical, as determined in good faith by the Company). 
 “Discharge of Priority Lien Obligations” means payment in full in cash of the principal of and interest and premium, if any, on all Debt constituting Priority Lien Obligations secured by any Collateral, or, with respect to
Hedging Obligations constituting Priority Lien Obligations secured by any Collateral, delivery of cash collateral or backstop letters of credit in respect thereof in compliance with the terms of such Priority Lien Obligations, in each case after or
concurrently with termination of all commitments to extend credit thereunder, and payment in full of any other obligations in respect of any Priority Lien Obligation secured by any Collateral that are due and payable or otherwise accrued and owing
at or prior to the time such principal, interest and premium, if any, are paid. 
 “Exchanged Securities” means
the Company’s 5.25% Convertible Senior Notes due 2028 issued under the Exchanged Securities Indenture, in exchange for which the Company has issued or will issue the Securities. 
 “Exchanged Securities Issue Date” means February 14, 2008, which is the date the Exchanged Securities were issued
under the Exchanged Securities Indenture. 
 “Exchanged Securities Indenture” means the Indenture dated as of
February 14, 2008 among the Company, the guarantors party thereto and the Trustee, as supplemented by the First Supplemental Indenture dated as of February 14, 2008 among the Company, the guarantors party thereto and the Trustee.

 “Exchanged Securities Underwriter” means Bear, Stearns & Co. Inc. 
 “Excluded Securities” means that portion of the Capital Stock or other securities of any Subsidiary pledged as Collateral
(but for the provisions of Section 11.12 hereof) the value (defined as the principal amount, par value, book value as carried by the Company or market value, whichever is greatest) of which, when considered in the aggregate with all other
Capital Stock or other securities of such Subsidiary subject to a security interest under any of the Security Documents, exceeds 19.99% of the principal amount of the then outstanding Securities; provided, however, in the event that Rule 3-16
of Regulation S-X promulgated by the SEC is amended, modified or interpreted by the SEC to require (or is replaced with another rule or regulation, or any other law, rule or regulation is adopted, which would require) the filing with the SEC
(or any other governmental agency) of separate financial statements of any Subsidiary due to the fact that such Subsidiary’s Capital Stock or other securities secure the Securities or the

  

 5 

 
Securities Guarantee, then the Capital Stock or other securities of such Subsidiary shall automatically be deemed to be Excluded Securities but only for so long as and to the extent necessary to
not be subject to such requirement; provided further, however, that if any Priority Lien Obligation is secured by a security interest in any securities that are Excluded Securities, such Priority Lien Obligation is registered under the Securities
Act, and, in connection with such registration, the Company is required to file with the SEC (or any other governmental agency) separate financial statements of the Subsidiary of the Company that is the issuer of such Capital Stock or other
securities, then such Capital Stock or other securities shall not be considered Excluded Securities. 
 “Ex-Dividend
Date” means, in respect of an issuance, a dividend or distribution to holders of Common Stock, the first date on which Common Stock trades on the applicable exchange or in the applicable market, regular way, without the right to receive the
issuance, dividend or distribution in question. 
 “Fair Market Value” means the amount that a willing buyer
would pay a willing seller in an arm’s length transaction. 
 A “Fundamental Change” shall be deemed to
have occurred if any of the following occurs: 
  

	 	(1)	any “person” or “group” within the meaning of Section 13(d) of the Exchange Act, other than the Company, any Subsidiary of the Company or any
employee benefit plan of the Company or any such Subsidiary, files a Schedule TO or any other schedule, form or report under the Exchange Act disclosing that such person or group has become the Beneficial Owner of Common Equity of the Company
representing more than 50% of the ordinary voting power of the Company’s Common Equity; 

  

	 	(2)	consummation of any share exchange, consolidation or merger of the Company pursuant to which the Common Stock will be converted into cash, securities or other property
or any sale, lease or other transfer (in one transaction or a series of transactions) of all or substantially all of the assets of the Company and its Subsidiaries, taken as a whole, to any Person other than one of the Company’s Subsidiaries;
provided, however, that a transaction where the holders of more than 50% of all classes of the Company’s Common Equity immediately prior to such transaction own, directly or indirectly, more than 50% of all classes of Common Equity of
the continuing or surviving entity or transferee or parent thereof immediately after such event shall not be a Fundamental Change; or 

  

	 	(3)	the Company’s Common Stock (or other Reference Property into which the Securities are then convertible) ceases to be listed on a U.S. national or regional
securities exchange or quoted on an established automated over-the-counter trading market in the United States for a period of 30 consecutive Scheduled Trading Days, 

  

 6 

 provided, however, that a Fundamental Change described in clause (2) of the definition above
shall not be deemed to have occurred if at least 90% of the consideration received or to be received by the holders of the Company’s Common Stock, excluding cash payments for fractional shares and cash payments in respect of statutory
dissenters’ rights, in connection with the transaction or transactions constituting the Fundamental Change described in clause (2) consists of shares of common stock (or depositary receipts or shares evidencing common stock) traded on a
U.S. national or regional securities exchange, or which shall be so traded when issued or exchanged in connection with such Fundamental Change as described in clause (2) of the definition above (such securities being referred to as
“Publicly Traded Securities”) and as a result of such transaction or transactions the Securities become convertible into such consideration. 
 “Guarantors” means (i) initially, the Initial Guarantors and (ii) each of the Company’s other Subsidiaries that provides a Securities Guarantee of the Securities pursuant
to the terms of the Indenture. 
 “Hedging Obligations” means, with respect to any Person, the obligations of
such Person under (i) currency exchange, interest rate or commodity swap agreements, currency exchange, interest rate or commodity cap agreements and currency exchange, interest rate or commodity collar agreements and (ii) other agreements
or arrangements designed to protect such Person against fluctuations in currency exchange, interest rates or commodity prices. 
 “IAI” means an institutional “accredited investor” as described in Rule 501(a)(1), (2), (3) or (7) under the Securities Act. 
 “Incur” means issue, assume, guarantee, incur or otherwise become liable for; provided, however, that any Priority Lien Obligations of a Person existing at the time such Person becomes a
Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a Subsidiary. The term “Incurrence” when used as a noun shall have a correlative meaning.
The accretion of principal of a non-interest bearing or other discount security, and the accrual of interest, fees and expenses under any Priority Lien Obligation Governing Documents or Priority Lien Obligation Security Documents evidencing,
governing or securing any Priority Lien Obligations, shall not be deemed the Incurrence of Priority Lien Obligations. 
 “Indenture” means the Original Indenture, as amended and supplemented by this First Supplemental Indenture and, if further amended or supplemented as herein provided, as so amended or supplemented. 
 “Intercreditor Agreement” means (i) that certain Lien Subordination and Intercreditor Agreement, dated as of the Issue
Date, by and among the Company, the Credit Facilities Collateral Agent, the Collateral Agent and the grantors and guarantors named therein, as amended (including any amendment and restatement thereof), supplemented or otherwise modified from time to
time, and (ii) after the termination of the Intercreditor Agreement referred to in clause (i) above, any other intercreditor agreement, with terms no less favorable to the Holders than the Intercreditor Agreement referred to in
clause (i) above, entered into by and among the Company, one or more representatives for any Priority Lien Obligations, the Collateral Agent and the grantors or guarantors named therein, as amended (including any amendment and restatement
thereof), supplemented or otherwise modified from time to time. 
  

 7 

 “Interest Payment Date” has the meaning set forth in Exhibit A
attached hereto. 
 “Issue Date” means March 31, 2010. 
 “Last Reported Sale Price” of the Common Stock (or any other security for which a Last Reported Sale Price must be
obtained) means, on any date, the closing sale price per share of Common Stock or such security (or if no closing sale price is reported, the average of the bid and ask prices or, if more than one in either case, the average of the average bid and
the average ask prices) on that date as reported in composite transactions for the principal U.S. national or regional securities exchange on which the Common Stock or such other security is listed for trading. If the Common Stock or such security
is not listed for trading on a U.S. national or regional securities exchange on the relevant date, the Last Reported Sale Price will be the mid-point of the last quoted bid and ask prices for the Common Stock or such security in the over-the-counter
market on the relevant date as reported by the National Quotation Bureau or similar organization. If the Common Stock or such security is not so quoted, the Last Reported Sale Price will be the average of the mid-point of the last bid and ask prices
for the Common Stock or such security on the relevant date from each of at least three nationally recognized independent investment banking firms (which may include the Exchanged Securities Underwriter or its Affiliates) selected by the Company for
this purpose. The Last Reported Sale Price shall be determined without reference to extended or after hours trading. 
 “Lien” means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof). 
 “Market Capitalization” means, as of any Trading Day, the product of (i) the Last Reported Sale Price of the Common
Stock on such Trading Day and (ii) the number of issued and outstanding shares of Common Stock as reflected in the Company’s most recent periodic or other report filed with the SEC. 
 “Market Disruption Event” means, for the purpose of the definition of Trading Day, the occurrence or existence during the
one half-hour period ending on the scheduled close of trading on the principal U.S. national or regional securities exchange on which the Common Stock is listed for trading of any material suspension or limitation imposed on trading (by reason of
movements in price exceeding limits permitted by the stock exchange or otherwise) in the Common Stock or in any options contracts or future contracts relating to the Common Stock. 
 “Officer” means, with respect to any Person, the Chairman of the Board, the Chief Executive Officer, the President, the
Chief Operating Officer, the Chief Financial Officer or any Vice President of such Person. 
 “Original
Indenture” means the indenture for Senior Debt Securities dated as of March 31, 2010 by and among the Company, the guarantors party thereto and the Trustee. 
  

 8 

 “Original Issue Discount” means the amount of ordinary interest income on a
Security that must be accrued as original issue discount for United States federal income tax purposes pursuant to Treasury Regulation Section 1.1275-4 or any successor provision. 
 “Other Permitted Collateral Liens” means (i) Liens imposed by law, such as materialmen’s, mechanics’,
carriers’, workmen’s and repairmen’s liens, and other similar Liens arising in the ordinary course of business securing obligations which are not overdue for a period of more than 30 days or are being contested in good faith by
appropriate procedures or proceedings and for which adequate reserves have been established; (ii) Liens arising in the ordinary course of business out of pledges or deposits under workers compensation laws, unemployment insurance, old age
pensions, or other social security or retirement benefits, or similar legislation to secure public or statutory obligations; (iii) Liens for taxes, assessment or other governmental charges which are not yet due and payable or which are being
actively contested in good faith by appropriate proceedings; (iv) Liens securing purchase money debt or obligations under any lease of any property or assets which would, in accordance with GAAP, be required to be classified and accounted for
as a capital lease, provided that (A) the aggregate principal amount of the obligations secured by such Liens shall not exceed $5,000,000 at any time outstanding, and (B) each such Lien encumbers only the property or assets purchased in
connection with the creation of any such purchase money debt or the subject of any such capital lease; (v) Liens arising from precautionary Uniform Commercial Code financing statements regarding operating leases; (vi) encumbrances
consisting of minor easements, zoning restrictions or other restrictions on the use of real property that do not (individually or in the aggregate) materially affect the value of the assets encumbered thereby or materially impair the ability of the
Company or any Subsidiary to use such assets in its business, and none of which is violated in any material aspect by existing or proposed structures or land use; (vii) Liens arising solely by virtue of any statutory or common law provision
relating to banker’s liens, rights of set-off or similar rights and remedies and burdening only deposit accounts or other funds maintained with a depository institution; (viii) Liens on cash or securities pledged to secure performance of
tenders, surety and appeal bonds, government contracts, performance and return of money bonds, bids, trade contracts, leases, statutory obligations, regulatory obligations and other obligations of a like nature incurred in the ordinary course of
business; (ix) judgment and attachment Liens not giving rise to an Event of Default, provided that no action to enforce any such Lien has been commenced; and (x) Liens existing on the date hereof on equipment and vehicles securing Debt
existing on the date hereof. 
 “Permitted Collateral Liens” means (i) Liens on the Collateral securing
Priority Lien Obligations in a principal amount which, when taken together with the principal amount of all other Priority Lien Obligations permitted by this clause (i) then outstanding (other than Hedging Obligations secured by Priority
Liens), does not exceed the sum of (A) $50,000,000, plus (B) the aggregate amount of all interest accrued under the Priority Lien Obligation Governing Documents evidencing or governing any such Priority Lien Obligations which, since the
Issue Date, has been capitalized and added to the principal of any such Priority Lien Obligations, (ii) Liens on the Collateral securing other Priority Lien Obligations (including without limitation Credit Agreement Indebtedness not otherwise
permitted under clause (i) above) in a principal amount which, when taken together with the principal amount of all other Priority Lien Obligations permitted by this clause (ii) then outstanding, does not exceed $10,000,000, so long as
Market Capitalization is $100,000,000 or more for at least 20 Trading Days during the period

  

 9 

 
of 30 consecutive Trading Days ending immediately prior to the date of Incurrence of such Priority Lien Obligations; (iii) Liens on the Collateral securing the Securities and the Securities
Guarantee; and (iv) Liens on the Collateral constituting Other Permitted Collateral Liens. For the avoidance of doubt, any Lien on the Collateral securing Credit Agreement Indebtedness Incurred or arising under or in respect of the Credit
Agreement as in effect on the Issue Date shall be deemed to be permitted pursuant to clause (i) of this definition. 
 “Preferred Stock”, as applied to the Capital Stock of any corporation, means Capital Stock of any class or classes (however designated) which is preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such corporation, over shares of Capital Stock of any other class of such corporation. 
 “Priority Lien” means any Lien on any Collateral for the benefit of the holders of any Debt or other obligations of the Company or any of its Subsidiaries (including without limitation
any Hedging Obligations) that are designated by the Company, as permitted by this First Supplemental Indenture, to rank prior to the Liens on such Collateral for the benefit of the Holders. 
 “Priority Lien Obligation” means any Debt or other obligations (including without limitation any Hedging Obligations) that
are secured by a Priority Lien. The relative priorities of the Liens securing the Priority Lien Obligations are determined by agreement among the holders of the Priority Lien Obligations. 
 “Priority Lien Obligation Governing Documents” means any instrument or document evidencing or governing any Priority Lien
Obligation, as amended, restated, supplemented, waived, or replaced (whether or not upon termination, and whether with the original lenders or otherwise), refinanced, restructure or otherwise modified from time to time. 
 “Priority Lien Obligations Security Documents” means the security agreements, pledge agreements, mortgages, deeds of trust
and collateral assignments defining the terms of the Priority Liens, as amended, restated, supplemented, waived or otherwise modified from time to time. 
 “QIB” a “qualified institutional buyer” as defined in Rule 144A under the Securities Act. 
 “Registration Statement” means a Registration Statement of the Company filed under the Securities Act. 
 “Regular Record Date” for the payment of interest on the Securities (including Contingent Interest and Additional Interest, if any), means the February 1 (whether or not a Business
Day) immediately preceding an Interest Payment Date on February 15 and August 1 (whether or not a Business Day) immediately preceding an Interest Payment Date on August 15. 
 “Regulation S” means Regulation S under the Securities Act. 
 “Restricted Securities Legend” means the legend set forth in Section 2.03(a) hereof. 
  

 10 

 “Rule 144” means Rule 144 under the Securities Act. 
 “Rule 506” means Rule 506 under the Securities Act. 
 “Scheduled Trading Day” means a day that is scheduled to be a Trading Day on the primary United States national securities
exchange or market on which the Common Stock is listed or admitted to trading. 
 “Securities” has the meaning
ascribed to it in the second introductory paragraph of this First Supplemental Indenture. 
 “Securities Act”
means the Securities Act of 1933 (15 U.S.C. §§77a-77aa), as amended, and the rules and regulations of the SEC promulgated thereunder. 
 “Security Documents” means the security agreements, pledge agreements, mortgages, deeds of trust and collateral assignments defining the terms of the Liens that secure the Securities and
the Securities Guarantee, as amended, restated, supplemented, waived or otherwise modified from time to time. 
 “Stated
Maturity” means February 15, 2028. 
 “Stock Price” means, in respect of a Fundamental Change,
the price per share of Common Stock paid in connection with such Fundamental Change, which shall be equal to (i) if such Fundamental Change is a transaction set forth in clause (2) of the definition thereof, and holders of Common Stock
receive only cash in such transaction, the cash amount paid per share of Common Stock and (ii) in all other cases, the average of the Last Reported Sale Prices of the Common Stock over the five Trading Day period ending on the Trading Day
preceding the Effective Date of such Fundamental Change. 
 “Trading Day” means any day during which
(i) trading in the Common Stock generally occurs on the primary United States national securities exchange or market on which the Common Stock (or other security in question) is listed or admitted for trading and (ii) there is no Market
Disruption Event.  
 “Trading Price” of the Securities on any date of determination means the average
of the secondary market bid quotations per $1,000 principal amount of the Securities obtained by the Bid Solicitation Agent for $5,000,000 principal amount of the Securities at approximately 3:30 p.m., New York City time, on such determination
date from two independent nationally recognized securities dealers the Company will select, but if only one such bid can reasonably be obtained by the Bid Solicitation Agent, this one bid shall be used. If the Bid Solicitation Agent cannot
reasonably obtain at least one bid for $5,000,000 principal amount of the Securities from a nationally-recognized securities dealer or if, in the Company’s reasonable judgment, the bid quotations are not indicative of the secondary market value
of the Securities, then the Trading Price of the Securities will be determined by the Company’s Board of Directors based on a good faith estimate of the fair value of the Securities; provided however that, for purposes of determining the
Trading Price pursuant to Section 9.01(a)(ii), if the Bid Solicitation Agent cannot reasonably obtain on any Trading Day at least one bid for $5,000,000 principal amount of the Securities from a nationally recognized securities dealer, then the
Trading Price per $1,000

  

 11 

 
principal amount of Securities for such Trading Day will be deemed to be less than 95% of the product of the Last Reported Sale Price of the Common Stock and the Conversion Rate on such Trading
Day. 
 “Transfer Restricted Security” means any Securities that bear or are required to bear the Restricted
Securities Legend. 
 “UCC” means the Uniform Commercial Code as in effect in the State of New York.

 “VWAP Market Disruption Event” means (i) a failure by the principal United States national or regional
securities exchange or market on which the Common Stock is listed or admitted to trading to open for trading during its regular trading session or (ii) the occurrence or existence prior to 1:00 p.m. New York City time on any Scheduled
Trading Day for the Common Stock for an aggregate one half-hour period of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the stock exchange or otherwise) in the Common Stock or in any
options contracts or futures contracts relating to the Common Stock. 
 “VWAP Trading Day” means a day during
which (i) trading in the Common Stock generally occurs on the principal United States national or regional securities exchange or market on which the Common Stock is listed or admitted for trading and (ii) there is no VWAP Market
Disruption Event. If the Common Stock is not so listed or traded, then “VWAP Trading Day” shall mean “Business Day.” 
 Section 1.03. Other Definitions.  
  

			
	 Term
	  	Defined in Section
	 “Additional Shares”
	  	        9.03(a)
	 “Company Notice”
	  	        8.03(a)
	 “Company Notice Date”
	  	        8.03(a)
	 “Conversion Date”
	  	        9.01(c)
	 “Conversion Obligation”
	  	        9.01(d)(i)
	 “Conversion Rate”
	  	        9.01
	 “Effective Date”
	  	        9.03(b)
	 “Fundamental Change Purchase Date”
	  	        8.01
	 “Fundamental Change Purchase Notice”
	  	        8.01(b)
	 “Fundamental Change Purchase Price”
	  	        8.01
	 “Measurement Period”
	  	        9.01(a)(ii)
	 “Net-Share Settlement”
	  	        9.01(d)
	 “Paying Agent”
	  	        2.04
	 “Purchase Date”
	  	        8.02(a)
	 “Purchase Notice”
	  	        8.02(a)
	 “Purchase Price”
	  	        8.02(a)
	 “Redemption Price”
	  	        4.01(b)
	 “Reference Property”
	  	        9.04
	 “Registrar”
	  	        2.04
	 “Reorganization Event”
	  	        9.04

  

 12 

			
	 Term
	  	Defined in Section
	 “Spin-Off”
	  	        9.02(c)

 Section 1.04. Rules of Construction. In addition to the rules of construction set forth in Section 1.1 of the Original Indenture, unless the context otherwise requires: 
 (a) “or” is not exclusive; 
 (b) the principal amount of any non-interest bearing or other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date
prepared in accordance with GAAP; 
 (c) the principal amount of any Preferred Stock shall be the greater of (i) the
maximum liquidation value of such Preferred Stock and (ii) the maximum mandatory redemption or mandatory repurchase price with respect to such Preferred Stock; and 
 (d) references to the Company and its Subsidiaries on a consolidated basis shall be deemed to include any other Guarantor. 
 ARTICLE 2 
 THE SECURITIES 
 Section 2.01. Title; Amount and Issue of Securities; Principal and Interest. 
 (a) The Securities shall be known and designated as the “5.25% Convertible Senior Secured Notes due 2028” of the Company. The
aggregate principal amount of Securities which may be authenticated and delivered under this First Supplemental Indenture is limited to $36,004,000, except for Securities authenticated and delivered upon registration of, transfer of, or in exchange
for, or in lieu of other Securities pursuant to Section 2.03, 2.05, 8.03, 9.01 hereof, or Sections 3.4, 3.5, 3.6, 6.14 or 11.7 of the Original Indenture. 
 (b) The Securities issued on the Issue Date will be offered and sold by the Company pursuant to an Exchange Agreement only to (i) Accredited Investors in reliance on Rule 506 and (ii) Persons
other than U.S. Persons (as defined in Regulation S) in reliance on Regulation S. 
 (c) The Securities shall mature on
February 15, 2028 unless earlier converted, redeemed or repurchased in accordance with the provisions hereof. 
 (d)
Interest on the Securities shall accrue from and including the date specified on the face of such Securities until the principal thereof is paid or made available for payment. Interest shall be payable semiannually in arrears on February 15 and
August 15 in each year, commencing August 15, 2010. For purposes of this First Supplemental Indenture, the Securities, and the Security Documents, unless the context clearly requires otherwise, references to “interest” shall
include Additional Interest and Contingent Interest. 
  

 13 

 (e) A Holder of any Security at 5:00 p.m., New York City time, on a Regular Record Date
shall be entitled to receive interest (including Contingent Interest and Additional Interest, if any), on such Security on the corresponding Interest Payment Date, notwithstanding the conversion of such Securities at any time after the close of
business on such Regular Record Date. Securities surrendered for conversion during the period from 5:00 p.m., New York City time, on any Regular Record Date to 9:00 a.m., New York City time, on the corresponding Interest Payment Date must
be accompanied by payment of an amount equal to the interest (including Contingent Interest and Additional Interest, if any) payable on such Securities on such Interest Payment Date. Notwithstanding the foregoing, no such payment of interest
(including Contingent Interest and Additional Interest) need be made by any converting Holder (i) if the Company has specified a Redemption Date that is after a Regular Record Date and on or prior to the corresponding Interest Payment Date,
(ii) if the Company has specified a Fundamental Change Purchase Date that is after a Regular Record Date and on or prior to the corresponding Interest Payment Date, or (iii) to the extent of any overdue interest (including Contingent
Interest and Additional Interest, if any) existing at the time of conversion of such Security. Except as described above, no interest, Contingent Interest or Additional Interest, if any, on converted Securities will be payable by the Company on any
Interest Payment Date subsequent to the date of conversion, and delivery of shares of Common Stock or the combination of cash and shares of Common Stock, if applicable, pursuant to Article 9 hereunder, together with any cash payment for any
fractional share, upon conversion will be deemed to satisfy in full the Company’s obligation to pay the principal amount of the Securities and accrued and unpaid interest and Contingent Interest and Additional Interest, if any, to, but not
including, the related Conversion Date. 
 (f) Principal of, and any premium on, Securities shall be payable at the office or
agency of the Company maintained for such purpose, which initially shall be the corporate trust office of the Trustee. Interest (including Contingent Interest and Additional Interest, if any) on Securities will be payable (i) to Holders having
an aggregate principal amount of $5,000,000 or less, by check mailed to the Holders of these Securities and (ii) to Holders having an aggregate principal amount of more than $5,000,000, either by check mailed to each Holder or, upon application
by a Holder to the Registrar not later than the relevant Regular Record Date, by wire transfer in immediately available funds to such Holder’s account within the United States, which application shall remain in effect until the Holder notifies,
in writing, the Registrar to the contrary. 
 Section 2.02. Form of Securities; Authentication. 
 (a) Except as otherwise provided pursuant to this Section 2.02, the Securities are issuable in fully registered form without coupons in
substantially the form of Exhibit A hereto, with such applicable legends as are provided for in Section 2.03. The terms and provisions contained in the form of Security shall constitute, and are hereby expressly made, a part of this First
Supplemental Indenture and to the extent applicable, the Company, the Guarantors and the Trustee, by their execution and delivery of this First Supplemental Indenture, expressly agree to such terms and provisions and to be bound thereby. 

 

 14 

 (b) The Trustee shall authenticate and make available for delivery, upon a written order of
the Company signed by two Officers, Securities for original issue on the Issue Date in an aggregate principal amount of up to $36,004,000. 
 Section 2.03. Legends. 
 (a) Except as otherwise provided by this
Section 2.03, each certificate evidencing the Securities and any Common Stock issued upon conversion thereof (unless the Security being converted was not required hereunder to bear such legend) shall bear a legend in substantially the following
form (each defined term in the legend being defined as such for purposes of the legend only): 
 “THIS
SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE FORM AND SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE ISSUER, THE REGISTRAR AND THE
TRANSFER AGENT. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE
SECURITIES ACT.” 
 (b) Upon any sale or transfer of a Transfer Restricted Security pursuant to, and in accordance with,
Rule 144, the Registrar shall permit the Holder thereof to exchange such Transfer Restricted Security for a Security that does not bear the Restricted Securities Legend and rescind any restriction on the transfer of such Transfer Restricted Security
if the Registrar receives (i) from the Holder, a written certification to the Company and the Registrar that its request for such exchange is made in reliance on Rule 144 (such certification to be included in the Assignment Form as set forth on
the back of the Security) and (ii) from the Company, an Opinion of Counsel opining that the Restricted Securities Legend can be removed. 
 (c) Upon any sale or transfer of any Transfer Restricted Security pursuant to, and in accordance with, an effective Registration Statement with respect to the Securities, the Registrar shall permit the
Holder thereof to exchange such Transfer Restricted Security for a Security that does not bear the Restricted Securities Legend and rescind any restriction on the transfer of such Transfer Restricted Security if the Registrar receives (i) from
the Holder, a written certification to the Company and the Registrar that its sale or transfer of the Security is made pursuant to such

  

 15 

 
effective Registration Statement (such certification to be included in the Assignment Form as set forth on the back of the Security) and (ii) from the Company, an Opinion of Counsel opining
that the Restricted Securities Legend can be removed. 
 (d) Upon the Holder of any Transfer Restricted Security becoming
eligible to sell or transfer such Transfer Restricted Security pursuant to Rule 144(b)(1) under the Securities Act, the Registrar shall permit the Holder thereof to exchange such Transfer Restricted Security for a Security that does not bear the
Restricted Securities Legend and rescind any restriction on the transfer of such Transfer Restricted Security if the Registrar receives (i) from the Holder, a written certification to the Company and the Registrar that its request for such
exchange is made in reliance on Rule 144(b)(1) (such certification to be in the form set forth on the back of the Security) and (ii) from the Company, an Opinion of Counsel opining that the Restricted Securities Legend can be removed.

 Section 2.04. Registrar and Paying Agent. The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange (the “Registrar”), which Registrar shall constitute a Security Register (as such term is defined in the Original Indenture), and an office or agency where Securities may be
presented for payment (the “Paying Agent”). The Company may have one or more co-registrars and one or more additional paying agents. The term “Paying Agent” includes any additional paying agent and the term
“Registrar” includes any co-registrar. 
 The Company shall enter into an appropriate agency agreement with any
Registrar or Paying Agent not a party to this First Supplemental Indenture, which shall incorporate the terms of the Trust Indenture Act. The agreement shall implement the provisions of this First Supplemental Indenture that relate to such agent.
The Company shall notify the Trustee of the name and address of each such agent. If the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to
Section 6.7 of the Original Indenture. The Company or any of its domestically organized, wholly owned Subsidiaries may act as Paying Agent, Registrar or transfer agent. 
 The Company initially appoints the Trustee as Registrar and Paying Agent for the Securities. The Company may remove any Registrar or Paying
Agent upon written notice to such Registrar or Paying Agent and to the Trustee; provided, however, that no such removal shall become effective until (i) acceptance of any appointment by a successor as evidenced by an appropriate
agreement entered into by the Company and such successor Registrar or successor Paying Agent, as the case may be, and delivered to the Trustee or (ii) notification to the Trustee that the Trustee shall serve as Registrar or Paying Agent until
the appointment of a successor in accordance with clause (i) above. The Registrar or Paying Agent may resign at any time upon written notice to the Company and the Trustee. 
 Section 2.05. General Provisions Relating to Transfer and Exchange. A Holder may transfer a Security only by written application
to the Registrar stating the name of the proposed transferee and otherwise complying with the terms of the Indenture. No such transfer shall be effected until, and such transferee shall succeed to the rights of a Holder only upon, final acceptance
and registration of the transfer by the Registrar in the Securities Register. 
  

 16 

 In addition to the matters described in the 7th paragraph of Section 3.5 of the Original Indenture, neither the
Company nor the Registrar shall be required to exchange or register a transfer of any Securities surrendered for conversion or, if a portion of any Security is surrendered for conversion, the portion thereof surrendered for conversion. 

Section 2.06. Intentionally Omitted. 
 Section 2.07. Original Issue Discount. The Securities are being issued with original issue discount. A Holder may obtain the issue price, the amount of original issue discount, the issue date
and the yield to maturity for the Securities by submitting a written request for such information to Flotek Industries, Inc., 2930 West Sam Houston Parkway North, Suite 300, Houston, TX 77043, Attention: Chief Financial Officer. 
 ARTICLE 3 
 COVENANTS 
 Section 3.01. Payment of Securities. The Company shall promptly pay the
principal of, interest (including Contingent Interest and Additional Interest, if any) and premium, if any, on the Securities on the dates and in the manner provided in the Securities and in this First Supplemental Indenture. Principal, interest
(including Contingent Interest and Additional Interest, if any) and premium, if any, shall be considered paid on the date due if by 11:00 a.m., New York City time, on such date the Trustee or the Paying Agent holds in accordance with this First
Supplemental Indenture immediately available funds sufficient to pay all principal, interest (including Contingent Interest and Additional Interest, if any) and premium, if any, then due. 
 The Company shall pay interest on overdue principal or premium, if any, at the rate specified therefor in the Securities, and it shall pay
interest on overdue installments of interest at the same rate to the extent lawful. 
 Notwithstanding anything to the contrary
contained in this First Supplemental Indenture, the Company may, to the extent it is required to do so by law, deduct or withhold income or other similar taxes imposed by the United States of America from principal, premium or interest (including
Contingent Interest and Additional Interest, if any) payments hereunder. 
 Section 3.02. Further Instruments and Acts.
Upon request of the Trustee, the Company will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this First Supplemental Indenture.

 Section 3.03. Statement by Officer as to Default; Trading Price of Securities. 
 (a) The Company shall deliver to the Trustee, within 30 days after the Company becomes aware of the occurrence of any Event of Default or
Default, an Officer’s Certificate setting forth the details of such events which would constitute an Event of Default or Default, its status and the action which the Company proposes to take with respect thereto. 
  

 17 

 (b) The Bid Solicitation Agent shall have no obligation to determine the Trading Price of
the Securities unless requested by the Company in an Officer’s Certificate, delivered at least five (5) Business Days prior to the applicable date of determination, specifying (i) the applicable dates on which the Bid Solicitation
Agent shall determine the Trading Price of the Securities; (ii) the names of the two independent nationally recognized securities dealers from which the Bid Solicitation Agent shall request the secondary market bid quotations for the
Securities; and (iii) the applicable provisions under the First Supplemental Indenture under which the Trading Price of the Securities is required to be determined. 
 Section 3.04. Additional Interest and Contingent Interest. If Additional Interest is payable by the Company or the Guarantors pursuant to Section 5.02, or if Contingent Interest is
payable by the Company or the Guarantors pursuant to the terms of the Securities, the Company or the Guarantors shall deliver to the Trustee an Officer’s Certificate to that effect stating (i) the amount of such Additional Interest or
Contingent Interest that is payable and (ii) the date on which such Additional Interest or Contingent Interest is payable. Unless and until a Responsible Officer of the Trustee receives such a certificate, the Trustee may assume without inquiry
that no Additional Interest or Contingent Interest is payable. If the Company or the Guarantors have paid Additional Interest or Contingent Interest directly to the Persons entitled to it, the Company or the Guarantors shall deliver to the Trustee
an Officer’s Certificate setting forth the particulars of such payment. 
 Section 3.05. Calculation Of Original
Issue Discount. The Company shall file with the Trustee promptly at the end of each calendar year (i) a written notice specifying the amount of Original Issue Discount (including daily rates and accrual periods) accrued on the Securities as
of the end of such year and (ii) such other specific information relating to such Original Issue Discount as may then be reasonably requested by the Trustee and relevant under the Internal Revenue Code of 1986, as amended from time to time, or
the Treasury regulations promulgated thereunder. 
 Section 3.06. Limitation on Liens. The Company shall not, and
shall not permit any Subsidiary to, directly or indirectly, incur or permit to exist any Lien of any nature whatsoever on any of its property or assets that constitute Collateral, whether owned at the Issue Date or thereafter acquired, other than
Permitted Collateral Liens. Notwithstanding the foregoing, to the extent that any asset that does not already constitute Collateral is pledged after the Issue Date by the Company or any Guarantor to secure any Credit Agreement Indebtedness or other
Priority Lien Obligations, such asset shall also be pledged to secure the Securities and the Securities Guarantee on an immediately junior basis in accordance with the Intercreditor Agreement to the Liens on such asset securing the Credit Agreement
Indebtedness and other Priority Lien Obligations (subject to other Permitted Collateral Liens) and such asset will thereafter be deemed to be part of the Collateral. 
  

 18 

 ARTICLE 4 
 REDEMPTION OF SECURITIES 
 Section 4.01. Optional Redemption. 
 (a) Prior to February 15, 2013, the Securities shall not be
redeemable. 
 (b) On and after February 15, 2013, subject to the terms and conditions of this Article 4, the Company
may, at its option, redeem for cash all or a portion of the Securities, at a price (the “Redemption Price”) equal to 100% of the principal amount of Securities to be redeemed, plus accrued and unpaid interest (including Contingent
Interest and Additional Interest, if any) to but excluding the Redemption Date. 
 (c) In the event that the Redemption Date
occurs after a Regular Record Date for the payment of interest and on or prior to the related Interest Payment Date, the Redemption Price for any such Securities to be redeemed shall be 100% of the principal amount of such Securities, and accrued
and unpaid interest (including Contingent Interest and Additional Interest, if any) shall be paid to the Holder on such Regular Record Date. 
 (d) The Securities are not subject to redemption through the operation of any sinking fund. 
 Section 4.02. Selection by Trustee of Securities to Be Redeemed. If any Securities selected for partial redemption are thereafter surrendered for conversion in part before termination of the
conversion right with respect to the portion of the Securities so selected, the converted portion of such Securities shall be deemed (so far as may be), solely for purposes of determining the aggregate principal amount of Securities to be redeemed
by the Company, to be the portion selected for redemption. Securities which have been converted during a selection of Securities to be redeemed may be treated by the Trustee as outstanding for the purpose of such selection. Nothing in this
Section 4.02 or Section 11.3 of the Original Indenture shall affect the right of any Holder to convert any Securities pursuant to Article 9 before the termination of the conversion right with respect thereto. 
 Section 4.03. Notice of Redemption. The Company shall notify each Holder of Securities to be redeemed in the manner provided in
Section 11.4 of the Original Indenture, except that notice of redemption shall be mailed not less than 91 nor more than 121 days prior to the Redemption Date. In addition to those matters set forth in Section 11.4 of the Original
Indenture, a notice of redemption sent to the Holder shall state: 
 (a) the then current Conversion Rate and provide a
statement that the Securities called for redemption may be converted at any time before the close of business on the third Scheduled Trading Day prior to the Redemption Date, and that Holders who wish to convert Securities must comply with the
relevant procedures; 
 (b) in case any Security is to be redeemed in part only, the notice which relates to such Security shall
state that on and after the Redemption Date, upon surrender of such Security, the Holder will receive, without charge, a new Security or Securities of authorized denominations for the principal amount thereof remaining unredeemed; 
  

 19 

 (c) the name and address of the Paying Agent and the Conversion Agent; and 
 (d) that Securities called for redemption must be surrendered to the Paying Agent to collect the Redemption Price. 
 ARTICLE 5 
 DEFAULTS AND REMEDIES 
 Section 5.01. Additional Events of
Default. In addition to those Events of Default set forth in Section 5.1 of the Original Indenture, the following events shall also be Events of Default with respect to the Securities: 
 (a) failure by the Company to comply with its obligation to convert the Securities in accordance with this First Supplemental Indenture upon
exercise of a Holder’s conversion right and such failure continues for a period of 10 days; 
 (b) failure by the Company
to give a Company Notice of the occurrence of a Fundamental Change to Holders pursuant to Section 8.01 or notice of a specified corporate transaction (as described in Section 9.01(a)(iv)) to Holders, in each case when due; 
 (c) except as permitted by Section 10.02, any Securities Guarantee of any Significant Subsidiary shall be held in any judicial
proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect, or any Guarantor which is a Significant Subsidiary, or any person acting on its behalf, shall deny or disaffirm its obligation under the
Securities Guarantee; 
 (d) failure by the Company for a period of 60 days after written notice from the Trustee or Holders of
at least 25% in principal amount of Securities then outstanding has been received to comply with any obligation, covenant or agreement in the Indenture or under the Securities or the Security Documents (or 180 days after such notice with respect to
any failure to comply with Section 12.01 hereof) (other than those referred to in clauses (a), (b), (c), (e), (f) and (g) of this Section 5.01); 
 (e) default by the Company or any Subsidiary in the payment of the principal or interest on any mortgage, agreement or other instrument under which there may be outstanding, or by which there may be
secured or evidenced, any indebtedness for money borrowed in excess of $15,000,000 in the aggregate of the Company and/or any such Subsidiary, whether such indebtedness now exists or shall hereafter be created, resulting in such indebtedness
becoming or being declared due and payable, and such acceleration shall not have been rescinded or annulled within 30 days after written notice of such acceleration has been received by the Company or such Subsidiary from the Trustee (or by the
Company and the Trustee from Holders of at least 25% in principal amount of outstanding Securities); 
 (f) a final judgment or
decree for the payment of $15,000,000 or more rendered against the Company or any Subsidiary, which judgment is not fully covered by insurance or not discharged or stayed within 60 days after (i) the date on which the right to appeal thereof
has expired if no such appeal has commenced or (ii) the date on which all rights to appeal have been extinguished; and 
  

 20 

 (g) (i) the Company or any Guarantor repudiates or disaffirms its obligations under any
of the Security Documents or a determination is made in a judicial proceeding that any of the Security Documents is unenforceable or invalid against the Company or any Guarantor for any reason with respect to any material portion of the Collateral,
or (ii) any Security Document shall cease to be in full force and effect in all material respects (other than in accordance with the terms of the applicable Security Document, the Intercreditor Agreement or this First Supplemented Indenture),
or cease to be effective to grant the Collateral Agent a perfected Lien on any material portion of the Collateral (but only to the extent the applicable Security Documents contemplated perfection and except as a result of the Collateral Agent’s
failure to file any necessary continuation statements or the Collateral Agent’s or the Credit Facilities Collateral Agent’s failure to maintain possession of any stock certificates, notes or other instruments or possessory collateral
delivered to it) with the priority purported to be created hereby (other than in accordance with the terms of the applicable Security Document, the Intercreditor Agreement or this First Supplemental Indenture). 
 The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary
or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body. 
 Notwithstanding the foregoing, a Default under clauses (d) or (e) of this Section 5.01 will not constitute an Event of Default until the Trustee notifies the Company (or the Holders of 25%
or more in principal amount of the outstanding Securities notify the Company and the Trustee) of the Default in writing and the Company does not cure such Default within the time specified in clauses (d) or (e) of this Section 5.01
after receipt of such notice. 
 Section 5.02. Sole Remedy for Failure to Report.
Notwithstanding any other provision of the Indenture, the sole remedy for an Event of Default relating to the failure to comply with the reporting obligations under Section 12.01 of this First Supplemental Indenture, and for any failure to
comply with the requirements of Section 314(a)(1) of the Trust Indenture Act, will for the 365 days after the occurrence of such an Event of Default consist exclusively of the right to receive Additional Interest on the principal amount of the
Securities at a rate equal to 0.25% per annum. This Additional Interest will be payable in the same manner and subject to the same terms as other interest payable under this First Supplemental Indenture. The Additional Interest will accrue on
all outstanding Securities from and including the date on which an Event of Default relating to a failure to comply with Section 12.01 or Section 314(a)(1) of the Trust Indenture Act first occurs to but not excluding the 365th day thereafter (or such earlier date on which the Event of Default
relating to the reporting obligations under Section 12.01 or Section 314(a)(1) of the Trust Indenture Act shall have been cured or waived). On such 365th day, such Additional Interest will cease to accrue and the Securities will be subject to acceleration and other
remedies as provided in this Article 5 if the Event of Default is continuing. For the avoidance of doubt, the provisions of this Section 5.02 will not affect the rights of Holders of Securities in the event of the occurrence of any other
Event of Default. 
  

 21 

 Section 5.03. Limitation on Suits. Subject to Section 5.8 of the Original
Indenture, a Holder may not pursue any remedy with respect to this First Supplemental Indenture or the Securities unless: 
 (a)
such Holder has previously given to the Trustee written notice stating that an Event of Default is continuing; 
 (b) Holders of
at least 25% in principal amount of the outstanding Securities have requested that the Trustee pursue the remedy; 
 (c) such
Holders have offered to the Trustee security or indemnity reasonably satisfactory to it against any loss, liability or expense to be incurred in compliance with such request; 
 (d) the Trustee has not complied with such request within 60 days after receipt of the request and the offer of security or indemnity; and

 (e) the Holders of a majority in principal amount of the outstanding Securities have not given the Trustee a direction that,
in the opinion of the Trustee, is inconsistent with such request within such 60-day period. 
 A Holder may not use this First
Supplemental Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder. 
 ARTICLE 6 
 DISCHARGE OF INDENTURE 
 Section 6.01. Discharge of Liability on Securities. Article 4 of the Original Indenture shall not apply to the Securities.
When (1) the Company shall deliver to the Registrar for cancellation all Securities theretofore authenticated (other than any Securities which have been mutilated, destroyed, lost or wrongfully taken and in lieu of or in substitution for which
other Securities shall have been authenticated and delivered) and not theretofore canceled, or (2) all the Securities not theretofore canceled or delivered to the Registrar for cancellation shall have (a) been deposited for conversion
(after all related Conversion Periods have elapsed) and the Company or the Guarantors shall deliver to the Holders shares of Common Stock or a combination of cash and shares of Common Stock, as applicable, sufficient to satisfy the Company’s
obligation to convert all Securities (other than any Securities which shall have been mutilated, destroyed, lost or wrongfully taken and in lieu of or in substitution for which other Securities shall have been authenticated and delivered) not
theretofore canceled or delivered to the Registrar for cancellation or (b) become due and payable on the Stated Maturity, Purchase Date, Fundamental Change Purchase Date or Redemption Date, as applicable, and the Company or the Guarantors shall
deposit with the Trustee cash and shares of Common Stock, if any, as applicable, sufficient to pay all amounts owing in respect of all Securities (other than any Securities which shall have been mutilated, destroyed, lost or wrongfully taken and in
lieu of or in substitution for which other Securities shall have been authenticated and delivered) not theretofore canceled or delivered to the Registrar for cancellation, including the principal

  

 22 

 
amount, premium, if any, and interest (including Contingent Interest and Additional Interest, if any) accrued and unpaid to such Stated Maturity, Purchase Date, Fundamental Change Purchase Date
or Redemption Date, as the case may be, and if in either case (1) or (2) the Company or the Guarantors shall also pay or cause to be paid all other sums payable hereunder or under the Security Documents by the Company or any Guarantor,
then the Indenture with respect to the Securities shall cease to be of further effect (except as to (i) remaining rights of registration of transfer, substitution and exchange and conversion of Securities; (ii) rights hereunder of Holders
to receive from the Trustee payments of the amounts then due, including interest (including Contingent Interest and Additional Interest, if any) or premium, if any, with respect to the Securities and the other rights, duties and obligations of
Holders, as beneficiaries hereof solely with respect to the amounts, if any, so deposited with the Trustee; and (iii) the rights, obligations and immunities of the Trustee, Authenticating Agent, Paying Agent, Conversion Agent, Collateral Agent
and Registrar under the Indenture with respect to the Securities), and the Trustee, on demand of the Company accompanied by an Officer’s Certificate and an Opinion of Counsel as required by Section 6.03 and at the cost and expense of the
Company, shall execute proper instruments acknowledging satisfaction of and discharging the Indenture with respect to the Securities; however, the Company hereby agrees to reimburse the Trustee, Authenticating Agent, Paying Agent, Conversion Agent,
Collateral Agent and Registrar for any costs or expenses thereafter reasonably and properly incurred by the Trustee, Authenticating Agent, Paying Agent, Conversion Agent, Collateral Agent and Registrar and to compensate the Trustee, Authenticating
Agent, Paying Agent, Conversion Agent, Collateral Agent and Registrar for any services thereafter reasonably and properly rendered by the Trustee, Authenticating Agent, Paying Agent, Conversion Agent, Collateral Agent and Registrar in connection
with the Indenture with respect to the Securities. 
 Section 6.02. Reinstatement. If the Trustee or the Paying
Agent is unable to apply any money to the Holders entitled thereto by reason of any order or judgment of any court of governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s and each
Guarantor’s obligations under the Indenture with respect to the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 6.01 until such time as the Trustee or the Paying Agent is permitted to apply
all such money in accordance with the Indenture and the Securities to the Holders entitled thereto; provided, however, that if the Company or the Guarantors make any payment of principal amount of, interest (including Contingent Interest and
Additional Interest, if any) or premium, if any, on any Security following the reinstatement of its obligations, the Company and the Guarantors shall be subrogated to the rights of the Holders of such Securities to receive such payment from the
money held by the Trustee or Paying Agent. 
 Section 6.03. Officer’s Certificate; Opinion of Counsel. Upon any
application or demand by the Company to the Trustee to take any action under Section 6.01, the Company shall furnish to the Trustee an Officer’s Certificate or Opinion of Counsel stating that all conditions precedent, if any, provided for
in this First Supplemental Indenture relating to the proposed action have been complied with. 
  

 23 

 ARTICLE 7 
 AMENDMENTS 
 Section 7.01. Without Consent of Holders.
In addition to the matters described in Section 9.1 of the Original Indenture, the Company, the Guarantors and the Trustee may amend or supplement this First Supplemental Indenture, any Security Documents or the Intercreditor Agreement,
without the consent of any Holder, for one or more of the following purposes: 
 (a) to provide for the addition of Collateral;
or 
 (b) to provide for the release of Collateral in accordance with the terms of Section 11.03 or 11.11 hereof.

 Section 7.02. With Consent of Holders. In addition to the matters described in Section 9.2 of the Original
Indenture, the Company, the Guarantors and the Trustee may not, without the consent of each Holder of Securities affected, amend or waive any portion of this First Supplemental Indenture, the Securities, any Security Documents or the Intercreditor
Agreement for one or more of the following purposes: 
 (a) to extend the stated time for payment of interest, including
Contingent Interest and Additional Interest, if any, or premium, on any Security; 
 (b) to otherwise impair the right of any
Holder to receive payment of principal of, or interest (including Contingent Interest and Additional Interest, if any) or premium, if any, on, such Holder’s Securities on or after the due dates therefor or to institute suit for the enforcement
of any payment on or with respect to such Holder’s Securities; 
 (c) to make any change that impairs or adversely affects
the conversion rights of any Securities; 
 (d) to reduce the Redemption Price, the Fundamental Change Purchase Price or the
Purchase Price payable upon the redemption or repurchase or conversion of any Security or amend or modify in any manner adverse to Holders of the Securities the Company’s obligation to make such payments; 
 (e) except as provided in Section 7.01(b) or 11.11 hereof, to release any substantial part of the Collateral; or 
 (f) to make any changes to the amendment provisions or to the waiver provisions which require each Holder’s consent. 
  

 24 

 ARTICLE 8 
 PURCHASE AT THE OPTION OF HOLDERS UPON A FUNDAMENTAL 
 CHANGE; PURCHASE AT THE OPTION OF
HOLDERS 
 Section 8.01. Purchase at the Option of the Holder Upon a Fundamental Change. 

If a Fundamental Change shall occur at any time, each Holder shall have the right, at such Holder’s option, to
require the Company to purchase any or all of such Holder’s Securities on a date specified by the Company that is no earlier than the 10th calendar day and no later than the 35th calendar day after the date of the Company Notice of the occurrence of such Fundamental Change (subject to extension
to comply with applicable law, as provided in Section 8.03(d)) (the “Fundamental Change Purchase Date”). The Company shall purchase such Securities at a price (the “Fundamental Change Purchase Price”), which
shall be paid in cash, equal to 100% of the principal amount of the Securities to be purchased plus accrued and unpaid interest, including any Contingent Interest and Additional Interest, to but excluding the Fundamental Change Purchase Date, unless
the Fundamental Change Purchase Date is between a Regular Record Date and the Interest Payment Date to which it relates, in which case the Fundamental Change Purchase Price shall equal 100% of the principal amount of Securities to be purchased, and
accrued and unpaid interest, including Contingent Interest and Additional Interest, if any, shall be paid to the Holder of record on the Regular Record Date. 
 (a) Notice of Fundamental Change. The Company shall mail to all Holders and the Trustee a Company Notice of the
occurrence of a Fundamental Change and of the purchase right arising as a result thereof, including the information required by Section 8.03(a) hereof, on or before the 20th calendar day after the occurrence of such Fundamental Change. The Company shall promptly furnish to the Paying Agent a
copy of such Company Notice. 
 (b) Exercise of Option. For a Security to be so purchased at the option of the Holder,
such Holder must deliver to the Paying Agent such Security duly endorsed for transfer, together with a written notice of purchase (a “Fundamental Change Purchase Notice”) in the form entitled “Form of Fundamental Change
Purchase Notice” attached to the Security duly completed, on or before the Business Day immediately preceding the Fundamental Change Purchase Date, subject to extension to comply with applicable law. The Fundamental Change Purchase Notice shall
state: 
 (i) the certificate numbers of the Securities which the Holder shall deliver to be purchased;

 (ii) the portion of the principal amount of the Securities which the Holder shall deliver to be purchased,
which portion must be $1,000 in principal amount or a multiple thereof; and 
 (iii) that such Securities shall
be purchased as of the Fundamental Change Purchase Date pursuant to the terms and conditions specified in paragraph 6(b) of the Securities and in this First Supplemental Indenture. 
  

 25 

 (c) Procedures. The Company shall purchase from a Holder, pursuant to this
Section 8.01, Securities if the principal amount of such Securities is $1,000 or a multiple of $1,000 if so requested by such Holder. 
 Any purchase by the Company contemplated pursuant to the provisions of this Section 8.01 shall be consummated by the delivery of the Fundamental Change Purchase Price to be received by the Holder
promptly following the later of the Fundamental Change Purchase Date or the time of delivery of the Securities. 
 Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent the Fundamental Change Purchase Notice contemplated by this Section 8.01 shall have the right at any time prior to the close of business on the
Business Day prior to the Fundamental Change Purchase Date to withdraw such Fundamental Change Purchase Notice (in whole or in part) by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 8.03(b).

 The Paying Agent shall promptly notify the Company of the receipt by it of any Fundamental Change Purchase Notice or written
notice of withdrawal thereof. 
 At or before 11:00 a.m. (New York City time) on the Fundamental Change Purchase Date, the
Company shall deposit with the Paying Agent (or if the Company or an Affiliate of the Company is acting as the Paying Agent, shall segregate and hold in trust as provided in Section 10.3 of the Original Indenture) cash sufficient to pay the
aggregate Fundamental Change Purchase Price of the Securities to be purchased pursuant to this Section 8.01. Payment by the Paying Agent of the Fundamental Change Purchase Price for such Securities shall be made promptly following the later of
the Fundamental Change Purchase Date or the time of delivery of such Securities. If the Paying Agent holds, in accordance with the terms of this First Supplemental Indenture, cash sufficient to pay the Fundamental Change Purchase Price of such
Securities on the Business Day following the Fundamental Change Purchase Date, then, on and after such date, such Securities shall cease to be outstanding and interest (including Contingent Interest and Additional Interest, if any) on such
Securities shall cease to accrue, whether or not such Securities are delivered to the Paying Agent, and all other rights of the Holder shall terminate (other than the right to receive the Fundamental Change Purchase Price and previously accrued and
unpaid interest (including Contingent Interest and Additional Interest, if any), upon delivery of the Securities). Nothing herein shall preclude any withholding of tax required by law. 
 The Company shall require each Paying Agent (other than the Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all cash held by the Paying Agent for the payment of the Fundamental Change Purchase Price and shall notify the Trustee of any default by the Company in making any such payment. If the Company or an Affiliate of the
Company acts as Paying Agent, it shall segregate the cash held by it as Paying Agent and hold it as a separate trust fund. The Company at any time may require a Paying Agent to deliver all cash held by it to the Trustee and to account for any funds
disbursed by the Paying Agent. Upon doing so, the Paying Agent shall have no further liability for the cash delivered to the Trustee. 
  

 26 

 Section 8.02. Purchase of Securities at the Option of the Holder. 
 (a) A Holder shall have the option to require the Company to purchase any outstanding Securities of such Holder on each of February 15,
2013, February 15, 2018 and February 15, 2023 (each, a “Purchase Date”), at a price (the “Purchase Price”) which shall be paid in cash, equal to 100% of the principal amount of the Securities to be
repurchased plus any accrued and unpaid interest, including any Contingent Interest and Additional Interest, if any, to but excluding the Purchase Date, upon: 
 (i) delivery to the Paying Agent by the Holder of a written notice of purchase (a “Purchase Notice”) at any
time from the opening of business on the date that is 20 Business Days prior to the relevant Purchase Date until the close of business on the second Business Day prior to such Purchase Date, stating: 
 (A) the certificate numbers of the Securities which the Holder will deliver to be purchased; 
 (B) the portion of the principal amount of the Securities which the Holder will deliver to be purchased, which portion must
be $1,000 in principal amount or a multiple thereof; 
 (C) that such Securities shall be purchased by the
Company as of the Purchase Date pursuant to the terms and conditions specified in paragraph 6(a) of the Securities and in this First Supplemental Indenture; and 
 (ii) delivery of such Securities to the Paying Agent (together with all necessary endorsements) at the offices of the Paying
Agent, such delivery being a condition to receipt by the Holder of the Purchase Price therefor; provided, however, that such Purchase Price shall be so paid pursuant to this Section 8.02 only if the Securities so delivered to the Paying
Agent shall conform in all respects to the description thereof in the related Purchase Notice. 
 (b) The Company shall purchase
from a Holder, pursuant to this Section 8.02, Securities if the principal amount of such Securities is $1,000 or a multiple of $1,000 if so requested by such Holder. 
 (c) Any purchase by the Company contemplated pursuant to the provisions of this Section 8.02 shall be consummated by the delivery of the Purchase Price to be received by the Holder promptly following
the later of the Purchase Date or the time of delivery of the Securities. 
 (d) Notwithstanding anything herein to the
contrary, any Holder delivering to the Paying Agent the Purchase Notice contemplated by this Section 8.02 shall have the right at any time prior to the close of business on the Business Day prior to the Purchase Date to withdraw such Purchase
Notice (in whole or in part) by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 8.03(b). 
  

 27 

 (e) The Paying Agent shall promptly notify the Company of the receipt by it of any Purchase
Notice or written notice of withdrawal thereof. 
 (f) At or before 11:00 a.m. (New York City time) on the Purchase Date,
the Company shall deposit with the Paying Agent (or if the Company or an Affiliate of the Company is acting as the Paying Agent, shall segregate and hold in trust) cash sufficient to pay the aggregate Purchase Price of the Securities to be purchased
pursuant to this Section 8.02. Payment by the Paying Agent of the Purchase Price for such Securities shall be made promptly following the later of the Purchase Date or the time of delivery of such Securities. If the Paying Agent holds, in
accordance with the terms of this First Supplemental Indenture, cash sufficient to pay the Purchase Price of such Securities on the Business Day following the Purchase Date, then, on and after such date, such Securities shall cease to be outstanding
and interest (including Contingent Interest and Additional Interest, if any) on such Securities shall cease to accrue, whether or not such Securities are delivered to the Paying Agent, and all other rights of the Holder shall terminate (other than
the right to receive the Purchase Price and previously accrued interest (including Contingent Interest and Additional Interest, if any) upon delivery of the Securities). Nothing herein shall preclude any withholding of tax required by law.

 (g) The Company shall require each Paying Agent (other than the Trustee) to agree in writing that the Paying Agent shall hold
in trust for the benefit of Holders or the Trustee all cash held by the Paying Agent for the payment of the Purchase Price and shall notify the Trustee of any default by the Company in making any such payment. If the Company or an Affiliate of the
Company acts as Paying Agent, it shall segregate the cash held by it as Paying Agent and hold it as a separate trust fund. The Company at any time may require a Paying Agent to deliver all cash held by it to the Trustee and to account for any funds
disbursed by the Paying Agent. Upon doing so, the Paying Agent shall have no further liability for the cash delivered to the Trustee. 
 Section 8.03. Further Conditions and Procedures for Purchase at the Option of the Holder Upon a Fundamental Change and Purchase of Securities at the Option of the Holder. 
 (a) Notice of Purchase Date or Fundamental Change. The Company shall send notices (each, a “Company
Notice”) to the Holders, beneficial owners of the Securities as required by applicable law, the Trustee and the Paying Agent, not less than 20 Business Days prior to each Purchase Date, or on or before the 20th calendar day after the occurrence of the Fundamental Change, as the
case may be (each such date of delivery, a “Company Notice Date”). Each Company Notice shall include a form of Purchase Notice or Fundamental Change Purchase Notice, as the case may be, to be completed by a Holder and shall state:

 (i) the applicable Purchase Price or Fundamental Change Purchase Price, as the case may be; 
 (ii) if conversion is permitted under Section 9.01(a)(iv), the Conversion Rate at the time of such notice and any
expected adjustments to the Conversion Rate; 
 (iii) the applicable Purchase Date or Fundamental Change Purchase
Date, as the case may be, and the last date on which a Holder may exercise its repurchase rights under Section 8.01 or Section 8.02, as applicable; 
  

 28 

 (iv) the name and address of the Paying Agent and the Conversion Agent;

 (v) that Securities must be surrendered to the Paying Agent to collect payment of the Purchase Price or the
Fundamental Change Purchase Price, as the case may be; 
 (vi) that Securities as to which a Purchase Notice or a
Fundamental Change Purchase Notice has been delivered may be surrendered for conversion only if the applicable Purchase Notice or Fundamental Change Purchase Notice, as the case may be, has been withdrawn in accordance with the terms of this First
Supplemental Indenture; 
 (vii) that the Purchase Price or the Fundamental Change Purchase Price for any
Securities as to which a Purchase Notice or a Fundamental Change Purchase Notice, as applicable, has been given and not withdrawn shall be paid by the Paying Agent promptly following the later of the Purchase Date or the Fundamental Change Purchase
Date, as applicable, or the time of delivery of such Securities; 
 (viii) the procedures the Holder must follow
under Sections 8.01 or 8.02, as applicable, and Section 8.03; 
 (ix) that, unless the Company defaults
in making payment of such Purchase Price or Fundamental Change Purchase Price on Securities covered by any Purchase Notice or Fundamental Change Purchase Notice, as applicable, interest (including Contingent Interest and Additional Interest, if any)
will cease to accrue on and after the Purchase Date or Fundamental Change Purchase Date, as applicable; 
 (x)
the procedures for withdrawing a Purchase Notice or a Fundamental Change Purchase Notice, as the case may be; and 
 (xi) in the case of a Company Notice pursuant to Section 8.01, the events causing a Fundamental Change and the effective date of the Fundamental Change. 
 Simultaneously with providing such Company Notice, the Company will publish a notice containing the information in such Company Notice in a newspaper of general circulation in The City of New York or
publish such information on its then existing website or through such other public medium as it may use at the time. 
 At the
Company’s request, made at least five Business Days prior to the date upon which such notice is to be mailed, and at the Company’s expense, the Trustee shall give the Company Notice in the Company’s name; provided, however,
that, in all cases, the text of the Company Notice shall be prepared by the Company. 
 (b) Adequacy and Effect of Purchase
Notice or Fundamental Change Purchase Notice; Withdrawal; Effect of Event of Default. The Company shall reasonably determine whether the Purchase Notice, Fundamental Change Purchase Notice or written notice of withdrawal delivered by the
relevant Holders satisfies the conditions set out in Section 8.01(b), Section 8.02(a) and Section 8.03 for such notices. The Company’s determination under this Section 8.03(b) will be binding and conclusive, absent manifest
error. 
  

 29 

 Upon receipt by the Company of the Purchase Notice or Fundamental Change Purchase Notice
specified in Section 8.02(a) or Section 8.01(b), as applicable, the Holder of the Securities in respect of which such Purchase Notice or Fundamental Change Purchase Notice, as the case may be, was given shall (unless such Purchase Notice
or Fundamental Change Purchase Notice is withdrawn as specified in the following two paragraphs) thereafter be entitled to receive solely the Purchase Price or Fundamental Change Purchase Price with respect to such Securities. Such Purchase Price or
Fundamental Change Purchase Price shall be paid by the Paying Agent to such Holder promptly following the later of (x) the Purchase Date or the Fundamental Change Purchase Date, as the case may be, with respect to such Securities
(provided the conditions in this Article 8 have been satisfied) and (y) the time of delivery of such Securities to the Paying Agent by the Holder thereof in the manner required by Section 8.02 or Section 8.01, as
applicable. Securities in respect of which a Purchase Notice or Fundamental Change Purchase Notice, as the case may be, has been given by the Holder thereof may not be converted on or after the date of the delivery of such Purchase Notice or
Fundamental Change Purchase Notice, as the case may be, unless such Purchase Notice or Fundamental Change Purchase Notice, as the case may be, has first been validly withdrawn as specified in the following two paragraphs. 
 A Purchase Notice or Fundamental Change Purchase Notice, as the case may be, may be withdrawn by means of a written notice of withdrawal
delivered to the office of the Paying Agent at any time prior to 5:00 p.m., New York City time, on the Business Day prior to the Purchase Date or the Fundamental Change Purchase Date, as the case may be, to which it relates, specifying:

 (i) the principal amount of the Securities with respect to which such notice of withdrawal is being submitted;

 (ii) the certificate number of the Securities in respect of which such notice of withdrawal is being
submitted; and 
 (iii) the principal amount, if any, of such Securities which remains subject to the original
Purchase Notice or Fundamental Change Purchase Notice, as the case may be, and which has been or shall be delivered for purchase by the Company. 
 There shall be no purchase of any Securities pursuant to Section 8.01 or Section 8.02 if an Event of Default has occurred and is continuing (other than a default that is cured by the payment of
the Purchase Price or Fundamental Change Purchase Price, as the case may be). The Paying Agent shall promptly return to the respective Holders thereof any Securities (x) with respect to which a Purchase Notice or Fundamental Change Purchase
Notice, as the case may be, has been withdrawn in compliance with this First Supplemental Indenture, or (y) held by it during the continuance of an Event of Default (other than a default that is cured by the payment of the Purchase Price or
Fundamental Change Purchase Price, as the case may be) in which case, upon such return, the Purchase Notice or Fundamental Change Purchase Notice with respect thereto shall be deemed to have been withdrawn. 
 (c) Securities Purchased in Part. Any Securities that are to be purchased only in part shall be surrendered at the office of the
Paying Agent (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the

  

 30 

 
Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing) and the Company shall execute, the Guarantors shall endorse and the Trustee
or the Authenticating Agent shall authenticate and deliver to the Holder of such Securities, without service charge, a new Security or Securities, of any authorized denomination as requested by such Holder in aggregate principal amount equal to, and
in exchange for, the portion of the principal amount of the Securities so surrendered which is not purchased. 
 (d) Covenant
to Comply with Securities Laws Upon Purchase of Securities. In connection with any offer to purchase Securities under Section 8.02 or Section 8.01, the Company shall, to the extent applicable, (a) comply with Rules 13e-4 and
14e-1 (and any successor provisions thereto) under the Exchange Act, if applicable; (b) file the related Schedule TO (or any successor schedule, form or report) under the Exchange Act, if applicable; and (c) otherwise comply with all
applicable federal and state securities laws so as to permit the rights and obligations under Section 8.02 or Section 8.01 to be exercised in the time and in the manner specified in Section 8.02 or Section 8.01. To the extent any
other provision of this First Supplemental Indenture conflicts with any of the foregoing, the foregoing shall govern. 
 (e)
Officer’s Certificate. At least five Business Days before the Company Notice Date, the Company shall deliver an Officer’s Certificate to the Trustee specifying whether the Company desires the Trustee to give the Company Notice (in
the form prepared by the Company) required by Section 8.03(a) herein. 
 ARTICLE 9 
 CONVERSION 
 Section 9.01. Conversion of Securities. 
 (a) Right to Convert. Subject to the procedures for
conversion set forth in this Article 9, a Holder may convert its Securities, in whole or in part (provided that the total principal amount of Securities converted are in integral multiples of $1,000), prior to January 15, 2028 at a rate
(the “Conversion Rate”) of 43.9560 shares of Common Stock (subject to adjustment by the Company as set forth herein) per $1,000 principal amount of Securities when one or more of the conditions specified below are met and during the
related specified period, subject to the limitations in clause (iii) of Section 9.01(a) and in Section 9.01(h). On and after January 15, 2028, as set forth under clause (b) below, a Holder may convert its Securities until
the close of business on the second Business Day immediately preceding Stated Maturity regardless of the conditions specified below, subject to the limitations in Section 9.01(h). 
 (i) Conversion Upon Satisfaction of Sale Price Condition. A Holder may surrender all or a portion of its Securities
for conversion during any fiscal quarter (and only during such fiscal quarter) if the Last Reported Sale Price for the Common Stock for at least 20 Trading Days during the period of 30 consecutive Trading Days ending on the last Trading Day of the
immediately preceding fiscal quarter is greater than or equal to 120% of the Conversion Price in effect on such last Trading Day. 
  

 31 

 (ii) Conversion Upon Satisfaction of Trading Price Condition. A
Holder may surrender its Securities for conversion during the five Business Day period after any 10 consecutive Trading Day period (the “Measurement Period”) in which the Trading Price per $1,000 principal amount of Securities, as
determined following a request by a Holder in accordance with the procedures set forth in this Section 9.01(a)(ii), for each Trading Day of the Measurement Period was less than 95% of the product of the Last Reported Sale Price of the Common
Stock and the Conversion Rate for such Trading Day. In connection with any conversion in accordance with this Section 9.01(a)(ii), the Bid Solicitation Agent shall have no obligation to determine the Trading Price of the Securities unless
requested by the Company; and the Company shall have no obligation to make such request unless a Holder provides the Company with reasonable evidence that the Trading Price per $1,000 principal amount of Securities would be less than 95% of the
product of the Last Reported Sale Price of the Common Stock and the Conversion Rate. Promptly after receiving such evidence, the Company shall instruct the Bid Solicitation Agent to determine the Trading Price of the Securities beginning on the next
Trading Day and on each successive Trading Day until the Trading Price per $1,000 principal amount of Securities for any Trading Day is greater than or equal to 95% of the product of the Last Reported Sale Price of the Common Stock and the
Conversion Rate. 
 (iii) Conversion Upon Notice of Redemption. If the Company calls any or all of the
Securities for redemption, a Holder may surrender for conversion the Securities called for redemption at any time prior to the close of business on the third Scheduled Trading Day prior to the related Redemption Date, even if the Securities are not
otherwise convertible at such time, after which time a Holder’s right to convert will expire unless the Company defaults in the payment of the Redemption Price. 
 (iv) Conversion Upon Specified Corporate Transactions. 
 (A) If the Company elects to (1) distribute to all holders of Common Stock any rights or warrants entitling them to
purchase, for a period expiring within 45 days after the Ex-Dividend Date of the distribution, shares of Common Stock at a price per share less than the average of the Last Reported Sale Price of Common Stock for the 10 consecutive Trading Day
period ending on the Trading Day immediately preceding the declaration date for such distribution, or (2) distribute to all holders of Common Stock assets, debt securities or rights to purchase securities of the Company, which distribution has
a per share Fair Market Value, as determined by the Company’s Board of Directors, exceeding 15% of the Last Reported Sale Price on the Trading Day immediately preceding the declaration date for such distribution, then, in each case, the Company
must notify the Holders of such distribution and of their rights under this clause (A), in the manner provided in Section 1.7 of the Original Indenture, at least 61 days prior to the 25th Scheduled Trading Day before the Ex-Dividend Date
for such distribution. Once the Company has given such notice, Holders may surrender Securities for conversion at any time until the earlier of 5:00 p.m., New York City time, on the Business Day immediately prior to such Ex-Dividend Date or the
Company’s announcement that such distribution will not take place even if the Securities are not otherwise convertible at such time. 
  

 32 

 (B) If the Company is party to a transaction described in clause (2) of
the definition of Fundamental Change (without giving effect to the proviso set forth in the definition thereof relating to Publicly Traded Securities), the Company must notify Holders of such an event and of their rights under this clause (B),
in the manner provided in Section 1.7 of the Original Indenture, at least 61 days prior to the 25th Scheduled Trading Day before the anticipated effective date for such transaction. Once the Company has given such notice, Holders may surrender
Securities for conversion at any time until seven Scheduled Trading Days after the actual effective date of such transaction or, if later, the related Fundamental Change Purchase Date. 
 (C) A Holder may surrender all or a portion of such Holder’s Securities for conversion, if a Fundamental Change of the
type described in clause (1) or (3) in the definition thereof occurs. In such event, Holders may surrender Securities for conversion at any time beginning on the actual Effective Date of such Fundamental Change until and including the date
which is 61 days after the seventh Scheduled Trading Day following the actual effective date of such transaction or, if later, until the related Fundamental Change Purchase Date. 
 A Holder may convert a portion of the principal amount of Securities if the portion is $1,000 or a multiple of $1,000. The number of shares
of Common Stock issuable or the combination of cash payable and the number of shares of Common Stock issuable, if any, upon conversion of a Security shall be determined as set forth in Section 9.01(d). 
 (b) Conversion During Specified Period Immediately Prior to Stated Maturity. Subject to the limitations in Section 9.01(h), but
notwithstanding anything else herein to the contrary, a Holder may surrender its Securities for conversion beginning on January 15, 2028, until the close of business on the second Business Day immediately preceding the Stated Maturity.

 (c) Conversion Procedures. To effect the conversion of Securities a Holder must (i) complete and manually sign
the conversion notice on the back of the Security, or a facsimile of such conversion notice; (ii) deliver such conversion notice, which is irrevocable, and the Security to the Conversion Agent; (iii) to the extent any shares of Common
Stock issuable upon conversion are to be issued in a name other than the Holder’s, furnish appropriate endorsements and transfer documents as may be required by the Conversion Agent; (iv) if required pursuant to Section 9.01(f) below,
pay all transfer or similar taxes; and (v) if required pursuant to Section 2.01(d) above, pay funds equal to interest payable on the next Interest Payment Date to which such Holder is not entitled. 
 The date a Holder satisfies the foregoing requirements is the “Conversion Date” hereunder. 
 If a Holder converts more than one Security at the same time, the number of shares of Common Stock issuable or the combination of the cash
payable and number of shares of Common Stock issuable upon the conversion, if any, shall be based on the total principal amount of the Securities converted. 
  

 33 

 Upon surrender of a Security that is converted in part, the Company shall execute, the
Guarantors shall endorse and the Trustee or the Authenticating Agent shall authenticate and deliver to the Holder, a new Security in an authorized denomination equal in principal amount to the unconverted portion of the Security surrendered.

 Delivery of shares of Common Stock will be accomplished by delivery to the Conversion Agent of certificates for the relevant
number of shares of Common Stock. 
 (d) Settlement Upon Conversion. In the event that the Company receives a
Holder’s notice of conversion upon satisfaction of one or more of the conditions to conversion described in this Section 9.01, the Company will notify the relevant Holders within two Scheduled Trading Days following the Conversion Date
whether the Company will satisfy its obligation to convert the Securities through delivery of (x) shares of Common Stock pursuant to clause (ii) below (plus cash in lieu of fractional shares) or (y) a combination of cash and shares of
Common Stock, if any (such method of settlement, a “Net-Share Settlement”) pursuant to clause (i) below; provided that the Company may not elect to satisfy such obligation pursuant to clause (ii) below if the
Company has made the election to waive such right to do so as set forth in the immediately succeeding sentence or if the Conversion Period for the applicable Securities would not commence on or after the Scheduled Trading Day after the
Company’s notice of settlement. At any time on or before the third Scheduled Trading Day prior to the applicable Conversion Period for a Net-Share Settlement, the Company may irrevocably waive, in its sole discretion without the consent of the
Holders, by notice to the Trustee and to the Holders, its right to satisfy its Conversion Obligation in shares of its Common Stock pursuant to clause (ii) below (plus cash in lieu of any fractional shares). Notwithstanding the foregoing, if the
Company elects to redeem the Securities, it will, in its notice of redemption, elect whether it will settle any conversions of Securities called for redemption pursuant to clause (i) or (ii) below (unless it has irrevocably elected to
waive its right to satisfy its Conversion Obligation pursuant to clause (ii) below), which election shall apply to all Securities converted following the Company’s notice of redemption. 
 (i) If the Company chooses or has to satisfy its obligation to convert the Securities (the “Conversion
Obligation”) by Net-Share Settlement (or if the Company has irrevocably elected to waive its right to satisfy its Conversion Obligation pursuant to clause (ii) below), upon conversion the Company will deliver to converting Holders cash
and Common Stock, if any, in respect of each $1,000 principal amount of Securities being converted, equal to the aggregate Daily Settlement Amounts for each of the 20 VWAP Trading Days during the related Conversion Period; provided that the
Company shall deliver cash in lieu of any fractional shares as described below in Section 9.01(e). The Daily Settlement Amounts shall be determined by the Company promptly following the last VWAP Trading Day of the Conversion Period.

 The amount of cash and Common Stock, if any, delivered in respect of any Security converted pursuant to this clause (i)
will be delivered to converting Holders as soon as practicable following the last VWAP Trading Day of the applicable Conversion Period. 
 (ii) If the Company elects to satisfy all of its Conversion Obligation with respect to Securities to be converted in shares of Common Stock, the Company will

  

 34 

 
deliver to any converting Holder, for each $1,000 principal amount of the Securities, a number of shares of Common Stock equal to the Conversion Rate for such Securities, plus cash in lieu of any
fractional shares determined as described below in Section 9.01(e). 
 The shares of Common Stock in respect of any Security
converted (and cash in lieu of any fractional shares) pursuant to this clause (ii) will be delivered through the Conversion Agent as soon as practicable following the applicable Conversion Date for such Security. 
 (iii) With respect to a conversion of a Security pursuant to clause (ii) above, at and after the close of business on
the Conversion Date, the Person in whose name any certificate representing any shares of Common Stock issuable upon such conversion is registered shall be treated as a stockholder of record of the Company to the extent permitted by law. With respect
to a conversion of a Security pursuant to clause (i) above by Net Share Settlement, on each VWAP Trading Day during the related Conversion Period, the Person in whose name any certificate representing any shares of Common Stock constituting the
Daily Settlement Amount for such VWAP Trading Day is registered shall be treated as a stockholder of record of the Company of such number of shares to the extent permitted by law on and after the close of business on such VWAP Trading Day. On and
after the Conversion Date with respect to a conversion of a Security pursuant hereto, all rights of the Holder of such Security shall terminate, other than the right to receive the consideration deliverable upon conversion of such Security as
provided herein. A Holder of a Security is not entitled, as such, to any rights of a holder of Common Stock until, if such Holder converts such Security and is entitled pursuant hereto to receive shares of Common Stock in respect of such conversion,
the close of business on the Conversion Date or respective VWAP Trading Days, as the case may be, with respect to such conversion. 
 (e) Cash Payments in Lieu of Fractional Shares. The Company shall not issue a fractional share of Common Stock upon conversion of Securities. Instead the Company shall deliver cash for the current market value of the fractional
share. The current market value of a fractional share shall be determined to the nearest 1/10,000th of a share by multiplying the Last Reported Sale Price of the Common Stock on the Conversion Date (or, in the case of Net-Share Settlement, the Daily
VWAP of the Common Stock on the last VWAP Trading Day of the relevant Conversion Period) by the fractional amount and rounding the product to the nearest whole cent. 
 (f) Taxes on Conversion. If a Holder converts Securities, the Company shall pay any documentary, stamp or similar issue or transfer tax due on the issue of shares of Common Stock upon the
conversion. However, the Holder shall pay any such tax which is due because the Holder requests the shares to be issued in a name other than the Holder’s name. The Conversion Agent may refuse to deliver the certificates representing the Common
Stock being issued in a name other than the Holder’s name until the Conversion Agent receives a sum sufficient to pay any tax which shall be due because the shares are to be issued in a name other than the Holder’s name, but the Conversion
Agent shall have no duty to determine if any such tax is due. Nothing herein shall preclude any withholding of tax required by law. 
  

 35 

 (g) Certain Covenants of the Company. 
 (i) The Company shall, prior to issuance of any Securities hereunder, and from time to time as may be necessary, reserve out
of its authorized but unissued Common Stock or shares of Common Stock held in treasury, a sufficient number of shares of Common Stock, free of preemptive rights, to permit the conversion of the Securities. 
 (ii) All shares of Common Stock delivered upon conversion of the Securities shall be newly issued shares or treasury shares,
shall be duly and validly issued and fully paid and nonassessable and shall be free from preemptive rights and free of any lien or adverse claim. 
 (iii) The Company shall endeavor promptly to comply with all federal and state securities laws regulating the issuance and delivery of shares of Common Stock upon the conversion of Securities, if any, and
shall cause to have listed or quoted all such shares of Common Stock on each U.S. national securities exchange or over-the-counter or other domestic market on which the Common Stock is then listed or quoted. 
 (iv) Before taking any action which would cause an adjustment increasing the Conversion Rate to an amount that would cause
the Conversion Price to be reduced below the then par value per share of the Common Stock, if any, of the shares of Common Stock issuable upon conversion of the Securities, the Company will take all corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally issue shares of such Common Stock at such adjusted Conversion Rate. 
 (h) Holder’s Conversion Limitations. Notwithstanding anything herein to the contrary, a Holder shall have no right to convert its Securities into shares of Common Stock, pursuant to
Section 9.01(a) hereof or otherwise, to the extent that, after giving effect to the issuance of Common Stock upon such conversion, such Holder (together with such Holder’s Affiliates and any other Persons acting as a group together with
such Holder or any of such Holder’s Affiliates) would beneficially own Common Stock in excess of the Beneficial Ownership Limitation. For purposes of the foregoing sentence, beneficial ownership shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. To the extent that the limitation contained in this Section 9.01(h) applies, the determination of whether the Securities of any Holder are convertible
(in relation to other securities owned by such Holder or any of such Holder’s Affiliates) and of which portion of the Securities of any Holder are convertible shall be in the sole discretion of such Holder, and the submission of a notice of
conversion in accordance with Section 9.01(c) shall be deemed to be such Holder’s determination of whether its Securities are convertible (in relation to other securities owned by such Holder or any of such Holder’s Affiliates) and of
which portion of its Securities are convertible, in each case subject to the Beneficial Ownership Limitation, and neither the Company nor the Conversion Agent shall have any obligation to verify or confirm the accuracy of such determination. In
addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 9.01(h), in

  

 36 

 
determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (i) the Company’s most recent
periodic or annual report filed with the SEC, (ii) a more recent public announcement by the Company or (iii) a more recent written notice by the Company or the transfer agent of the Common Stock setting forth the number of shares of Common
Stock outstanding. Upon the written or oral request of a Holder, the Company shall within two Business Days confirm orally and in writing to such Holder the number of shares of Common Stock then outstanding. 
 Section 9.02. Adjustments to Conversion Rate. The Conversion Rate shall be adjusted by the Company as follows: 
 (a) If the Company issues shares of Common Stock as a dividend or distribution on shares of the Common Stock, or effects a share split or
share combination, the Conversion Rate will be adjusted based on the following formula: 

 

 

  

					
	where,	 		  	
			
	CR0	 	=	  	the Conversion Rate in effect immediately prior to the Ex-Dividend Date for such dividend or distribution, or the effective date of such share split or share combination, as the
case may be;
			
	CR'	 	=	  	the new Conversion Rate in effect immediately after the Ex-Dividend Date for such dividend or distribution, or the effective date of such share split or share combination, as the
case may be;
			
	OS0	 	=	  	the number of shares of Common Stock outstanding immediately prior to the Ex-Dividend Date for such dividend or distribution, or the effective date of such share split or share
combination, as the case may be; and
			
	OS'	 	=	  	the number of shares of Common Stock outstanding immediately after, and solely as a result of, such event.

 Such adjustment shall become effective immediately after (i) the Ex-Dividend Date for such dividend or distribution or (ii) the date on which such
split or combination becomes effective, as applicable. If any dividend or distribution of the type described in this clause Section 9.02(a) is declared but not so paid or made, the new Conversion Rate shall again be adjusted to the Conversion
Rate that would then be in effect if such dividend or distribution had not been declared. 
  

 37 

 (b) If the Company distributes to all holders of its Common Stock any rights or warrants
entitling them to purchase, for a period of not more than 45 days after the Ex-Dividend Date for the distribution, shares of Common Stock at a price per share less than the average of the Last Reported Sale Prices of the Common Stock for the 10
consecutive Trading Day period ending on the Trading Day immediately preceding the declaration date for such distribution, the Conversion Rate will be adjusted based on the following formula: 

 

 

  

					
	where,	 		  	
			
	CR0	 	=	  	the Conversion Rate in effect immediately prior to the Ex-Dividend Date for such distribution;
			
	CR'	 	=	  	the new Conversion Rate in effect immediately after the Ex-Dividend Date for such distribution;
			
	OS0	 	=	  	the number of shares of Common Stock outstanding immediately prior to the Ex-Dividend Date for such distribution;
			
	X	 	=	  	the total number of shares of Common Stock issuable pursuant to such rights or warrants; and
			
	Y	 	=	  	the number of shares of Common Stock equal to the aggregate price payable to exercise such rights or warrants divided by the average of the Last Reported Sale Prices of the Common
Stock over the 10 consecutive Trading Day period ending on the Trading Day immediately preceding the Ex-Dividend Date for such distribution.

 For purposes of this clause Section 9.02(b), in determining whether any rights or warrants entitle the Holders to subscribe for or purchase shares of Common Stock at less than the average of the
applicable Last Reported Sale Prices, and in determining the aggregate exercise or conversion price payable for such shares of Common Stock, there shall be taken into account any consideration received by the Company for such rights or warrants and
any amount payable on exercise or conversion thereof, with the value of such consideration, if other than cash, to be determined by the Board of Directors. If any right or warrant described in this clause Section 9.02(b) is not exercised or
converted prior to the expiration of the exercisability or convertibility thereof, the new Conversion Rate shall be readjusted to the Conversion Rate that would then be in effect if such right or warrant had not been so issued. Any adjustment made
pursuant to this clause Section 9.02(b) shall become effective immediately after the Ex-Dividend Date for the applicable distribution. 
 (c) If the Company distributes shares of Capital Stock, evidences of its indebtedness or other assets or property of the Company to all holders of the Common Stock, excluding: 
 (i) dividends or distributions as to which an adjustment applies under clause (a) or (b) above; 
 (ii) dividends or distributions paid exclusively in cash; and 
  

 38 

 (iii) Spin-Offs to which the provisions set forth below in this
clause (c) shall apply; 
 then the Conversion Rate will be adjusted based on the following formula: 

 

 

  

					
	where,	 		  	
			
	CR0	 	=	  	the Conversion Rate in effect immediately prior to the Ex-Dividend Date for such distribution;
			
	CR'	 	=	  	the new Conversion Rate in effect immediately after the Ex-Dividend Date for such distribution;
			
	SP0	 	=	  	the average of the Last Reported Sale Prices of the Common Stock over the 10 consecutive Trading Day period ending on the Trading Day immediately preceding the Ex-Dividend Date for
such distribution; and
			
	FMV	 	=	  	the Fair Market Value (as determined by the Board of Directors) of the shares of Capital Stock, evidences of indebtedness, assets or property distributed with respect to each
outstanding share of Common Stock on the Ex-Dividend Date for such distribution.

 Such adjustment shall become effective
immediately after the Ex-Dividend Date for the applicable distribution. 
 With respect to an adjustment pursuant to this clause (c) where
there has been a payment of a dividend or other distribution on the Common Stock of shares of Capital Stock of any class or series, or similar equity interest, of or relating to a Subsidiary or other business unit (a “Spin-Off”),
the Conversion Rate in effect immediately before 5:00 p.m., New York City time, on the tenth Trading Day immediately following, and including, the effective date of the Spin-Off will be increased based on the following formula: 

 

 

  

					
	where,	 		  	
			
	CR0	 	=	  	the Conversion Rate in effect immediately prior to the tenth Trading Day immediately following, and including, the effective date of the Spin-Off;
			
	CR'	 	=	  	the new Conversion Rate in effect immediately after the tenth Trading Day immediately following, and including, the effective date of the Spin-Off;

  

 39 

					
	FMV0	 	=	  	the average of the Last Reported Sale Prices of the Capital Stock or similar equity interest distributed to holders of Common Stock applicable to one share of Common Stock over the
first 10 consecutive Trading Day period immediately following, and including, the effective date of the Spin-Off; and
			
	MP0	 	=	  	the average of the Last Reported Sale Prices of Common Stock over the first 10 consecutive Trading Day period immediately following, and including, the effective date of the
Spin-Off.

 Such adjustment shall occur immediately after the tenth Trading Day immediately following, and including, the
effective date of the Spin-Off; provided that in respect of any conversion during the ten Trading Days following the effective date of any Spin-Off, references within the portion of this clause (c) related to “Spin-Offs” to 10
Trading Days shall be deemed replaced with such lesser number of Trading Days as have elapsed between the effective date of such Spin-Off and the relevant Conversion Date. 
 If any such dividend or distribution described in this clause (c) is declared but not paid or made, the new Conversion Rate shall be readjusted to be the Conversion Rate that would then be in effect
if such dividend or distribution had not been declared. 
 (d) If any cash dividend or distribution is made to all holders of
Common Stock, the Conversion Rate will be adjusted based on the following formula: 

 

 

  

					
	where,	 		  	
			
	CR0	 	=	  	the Conversion Rate in effect immediately prior to the Ex-Dividend Date for such distribution;
			
	CR'	 	=	  	the new Conversion Rate in effect immediately after the Ex-Dividend Date for such distribution;
			
	SP0	 	=	  	the Last Reported Sale Price of the Common Stock on the Trading Day immediately preceding the Ex-Dividend Date for such distribution; and
			
	C	 	=	  	the amount in cash per share of Common Stock of the Company distributes to holders of Common Stock.

 An adjustment to the Conversion Rate made pursuant to this clause (d) shall become effective immediately after the Ex-Dividend Date for the applicable dividend or distribution. If any dividend or
distribution described in this clause (d) is declared but not so paid or made, the new Conversion Rate shall be readjusted to the Conversion Rate that would then be in effect if such dividend or distribution had not been declared. 

 

 40 

 (e) If the Company or any of its Subsidiaries makes a payment in respect of a tender or
exchange offer for Common Stock, to the extent that the cash and value of any other consideration included in the payment per share of Common Stock exceeds the Last Reported Sale Price of the Common Stock on the Trading Day next succeeding the last
date on which tenders or exchanges may be made pursuant to such tender or exchange offer, the Conversion Rate will be increased based on the following formula: 

 

 

  

					
	where,	 		  	
			
	CR0	 	=	  	the Conversion Rate in effect at the close of business on the last Trading Day of the 10 consecutive Trading Day period commencing on the Trading Day next succeeding the date such
tender or exchange offer expires;
			
	CR'	 	=	  	the new Conversion Rate in effect immediately following the last Trading Day of the 10 consecutive Trading Day period commencing on the Trading Day next succeeding the date such
tender or exchange offer expires;
			
	AC	 	=	  	the aggregate value of all cash and any other consideration (as determined by the Board of Directors) paid or payable for shares purchased in such tender or exchange
offer;
			
	OS0	 	=	  	the number of shares of Common Stock outstanding immediately prior to the expiration of such tender or exchange offer;
			
	OS'	 	=	  	the number of shares of Common Stock outstanding immediately after the expiration of such tender or exchange offer (after giving effect to the purchase or exchange of shares
pursuant to such tender or exchange offer); and
			
	SP'	 	=	  	the average of the Last Reported Sale Prices of Common Stock over the 10 consecutive Trading Day period commencing on the Trading Day next succeeding the date such tender or
exchange offer expires.

 The adjustment to the Conversion Rate under this clause (e) shall become effective immediately
following the tenth Trading Day next succeeding the date such tender or exchange offer expires; provided that, in respect of any conversion during the ten Trading Days following the date that any tender or exchange offer expires, references
within this clause (e) to 10 Trading Days shall be deemed replaced with such lesser number of Trading Days as have elapsed between the date such tender or exchange offer expires and the relevant Conversion Date. If the Company or one of its
Subsidiaries is obligated to purchase Common Stock pursuant to any such tender or exchange offer but are permanently prevented by applicable law from effecting any such purchase or all such purchases are rescinded, the new Conversion Rate shall be
readjusted to be the Conversion Rate that would be in effect if such tender or exchange offer had not been made. 
 (f)
Notwithstanding the foregoing provisions of this Section 9.02, no adjustment will be made thereunder, nor shall an adjustment be made to the ability of a Holder to convert, for

  

 41 

 
any distribution described therein if the Holder will otherwise participate in the distribution on the same terms as holders of Common Stock as if such Holder held a number of shares of Common
Stock equal to the applicable Conversion Rate, multiplied by the principal amount (expressed in thousands) of the Securities held by such holder, without having to convert its Securities. Further, if the application of the foregoing formulas
in this Section 9.02 would result in a decrease in the Conversion Rate, no adjustment to the Conversion Rate will be made (except on account of share combinations). 
 (g) No adjustment to the Conversion Rate will be made unless as specifically set forth in this Section 9.02 and Section 9.03. 
 (h) Without limiting the foregoing, no adjustment to the Conversion Rate need be made: 
 (i) upon the issuance of any shares of Common Stock pursuant to any present or future plan providing for the reinvestment of
dividends or interest payable on securities of the Company and the investment of additional optional amounts in shares of Common Stock under any plan; 
 (ii) upon the issuance of any shares of Common Stock or options or rights to purchase shares of Common Stock pursuant to any present or future employee, director or consultant benefit plan or program or
employee stock purchase plan of or assumed by the Company or any of its Subsidiaries; 
 (iii) upon the issuance
of any shares of Common Stock pursuant to any option, warrant, right, or exercisable, exchangeable or convertible security not described in clause (ii) above and outstanding as of the Exchanged Securities Issue Date; 
 (iv) for a change in the par value of the Common Stock; or 
 (v) for accrued and unpaid Interest (including Contingent Interest and Additional Interest, if any) on the Securities.

 (i) No adjustment to the Conversion Rate will be required unless the adjustment would require an increase or decrease of at
least 1% of the Conversion Rate. If the adjustment is not made because the adjustment does not change the Conversion Rate by at least 1%, then the adjustment that is not made will be carried forward and taken into account in any future adjustment.
All required calculations will be made to the nearest cent or 1/1000th of a share, as the case may be. Notwithstanding the foregoing, if the Securities are called for redemption or upon a Fundamental Change, all adjustments not previously made will
be made for all the Securities to be converted after the Company’s notice of redemption to the applicable Redemption Date or after the Company’s notice of a Fundamental Change, as applicable. 
 (j) Whenever the Conversion Rate is adjusted as herein provided, the Company shall promptly file with the Trustee and any Conversion Agent
other than the Trustee an Officer’s Certificate setting forth the Conversion Rate after such adjustment and setting forth a brief statement of the facts requiring such adjustment. Unless and until a Responsible Officer of the Trustee shall have
received such Officer’s Certificate, the Trustee shall not be deemed to have

  

 42 

 
knowledge of any adjustment of the Conversion Rate and may assume that the last Conversion Rate of which it has knowledge is still in effect. Promptly after delivery of such certificate, the
Company shall prepare a notice of such adjustment of the Conversion Rate setting forth the adjusted Conversion Rate and the date on which each adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Rate to the
Holder of each Security at such Holder’s last address appearing on the Securities Register provided for in Section 2.04 of this First Supplemental Indenture within 20 days after execution thereof. Failure to deliver such notice shall not
affect the legality or validity of any such adjustment. 
 (k) For purposes of this Section 9.02, the number of shares of
Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. If the Company pays any
dividend or makes any distribution on, or issues any rights, options or warrants in respect of, shares of Common Stock held in treasury by the Company, the Company shall not issue, transfer or convey such shares of Common Stock in a manner that
would have the effect of circumventing the provisions of this Section 9.02. 
 (l) If Net-Share Settlement applies and any
provision of this Article 9 requires a calculation of an average of the Daily VWAP over a span of multiple days, the Company will make appropriate adjustments to the Daily Settlement Amount (determined in good faith by the Board of Directors)
to account for any adjustment to the Conversion Rate that becomes effective, or any event requiring an adjustment to the Conversion Rate where the Ex-Dividend Date of the event occurs, at any time during the period from which such calculation is to
be calculated; provided that such adjustments shall only be made to the Daily Settlement Amounts relating to days prior to the date that the adjustment to the Conversion Rate becomes effective. 
 Section 9.03. Adjustment to Common Stock Delivered Upon Certain Fundamental Changes. 
 (a) If a Holder elects to convert Securities pursuant to Section 9.01(a)(iv) above in connection with a Fundamental Change on or
following the effective date of the transaction and the transaction has an effective date occurring on or prior to February 15, 2013, subject to Section 9.04 below, the Conversion Rate for such converted Securities shall be increased by an
additional number of shares of Common Stock (the “Additional Shares”) as described below. Any conversion will be deemed to have occurred in connection with such Fundamental Change if such Securities are surrendered for conversion on
or following the effective date of a Fundamental Change and prior to the expiration of the time during which Securities may be converted in respect of such Fundamental Change as specified in Section 9.01(a)(iv) and notwithstanding the fact that
a Security may then be convertible because another condition to conversion also has been satisfied. 
 (b) The number of
Additional Shares will be determined by reference to the table attached as Schedule A hereto, based on the actual effective date on which the Fundamental Change occurs or becomes effective (the “Effective Date”) and the Stock
Price paid per share of Common Stock with respect to such Fundamental Change; provided that if the Stock Price is between two Stock Price amounts set forth in such table or the Effective Date is between two Effective Dates in the table, the
number of Additional Shares will be determined by a straight-line

  

 43 

 
interpolation between the number of Additional Shares set forth for the higher and lower Stock Price amounts and the two dates, as applicable, based on a 365-day year; provided further
that if the Stock Price is greater than $100.00 per share (subject to adjustment as set forth in clause (c) below) or less than $17.50 per share (subject to adjustment as set forth in clause (c) below), then no Additional Shares will be
added to the Conversion Rate. Notwithstanding the foregoing, the Conversion Rate shall not exceed 57.1429 per $1,000 principal amount of Securities on account of adjustments pursuant to this Section 9.03, subject to adjustments set out in
Section 9.02(a) through (e). 
 (c) The Stock Prices set forth in the first row of the table in Schedule A hereto will
be adjusted as of any date on which the Conversion Rate of the Securities is otherwise adjusted pursuant to Section 9.02. The adjusted Stock Prices will equal the Stock Prices applicable immediately prior to such adjustment, multiplied by a
fraction, the numerator of which is the Conversion Rate immediately prior to such adjustment and the denominator of which is the Conversion Rate as so adjusted. The number of Additional Shares set forth in such table will be adjusted in the same
manner as the Conversion Rate as set forth in Section 9.02. 
 Section 9.04. Effect of Recapitalizations,
Reclassifications, and Changes of Common Stock. 
 (a) If any of the following events occur: (i) any recapitalization,
reclassification or change of the outstanding shares of Common Stock (other than a subdivision or combination to which Section 9.02(a) applies), (ii) any consolidation, merger or combination of the Company with another Person,
(iii) any sale or conveyance to another Person of all or substantially all of the property and assets of the Company and its Subsidiaries, or (iv) any statutory share exchange, in each case as a result of which Common Stock would be
converted into, or exchanged for, stock, other securities, other property or assets (including cash or any combination thereof) (any such event or transaction, a “Reorganization Event”), then, following the effective time of the
Reorganization Event, the right to receive shares of Common Stock upon conversion of Securities, if any, will be changed into a right to receive the kind and amount of shares of stock, other securities or other property or assets (including cash or
any combination thereof) (the “Reference Property”) that a Holder would have been entitled to receive upon such Reorganization Event in respect of Common Stock, as provided below. If the Reorganization Event causes Common Stock to
be converted into the right to receive more than a single type of consideration (determined based in part upon any form of stockholder election), the Reference Property will be deemed to be the weighted average of the types and amounts of
consideration received by the holders of Common Stock that affirmatively make such an election. The Company will notify Holders of the weighted average as soon as practicable after such determination is made. Upon such Reorganization Event, the
Company or any Successor Company will enter into a supplemental indenture consistent with the foregoing. Such supplemental indenture shall provide for provisions and adjustments which shall be as nearly equivalent as may be practicable to the
provisions and adjustments provided for in this Article 9, Article 7 and Article 8 of this First Supplemental Indenture, Article 9 of the Original Indenture and the definition of Fundamental Change, as appropriate, as determined
in good faith by the Company (which determination shall be conclusive and binding), to make such provisions apply to such other Person if different from the original issuer of the Securities. 
  

 44 

 (b) Following the effective time of any such Reorganization Event, settlement of Securities
converted shall be in units of Reference Property or cash and units of Reference Property, if applicable, determined in accordance with Section 9.01(d)(i) and Section 9.01(d)(ii) above. The Conversion Rate will relate to units of Reference
Property (a “unit” of Reference Property being the kind and amount of reference property that a holder of one share of Common Stock would have received in such transaction); and the Daily VWAP will be determined based on the Daily VWAP of
one unit of Reference Property. 
 (c) The Company shall cause notice of the execution of any supplemental indenture required by
this Section 9.04 to be mailed to each Holder, at its address appearing on the Securities Register provided for in Section 2.04 of this First Supplemental Indenture, within 20 calendar days after execution thereof. Failure to deliver such
notice shall not affect the legality or validity of such supplemental indenture. 
 (d) The above provisions of this
Section 9.04 shall similarly apply to successive Reorganization Events. 
 (e) If this Section 9.04 applies to any
event or occurrence, Section 9.02 shall not apply in respect of such event or occurrence. 
 (f) The Company shall not
become a party to any Reorganization Event unless its terms are consistent with the foregoing. None of the foregoing provisions shall affect the right of a Holder of Securities to convert the Securities as set forth in and subject to
Section 9.01 prior to the effective time of such Reorganization Event. 
 Section 9.05. Responsibility of Trustee.
The Trustee and any other Conversion Agent shall not at any time be under any duty or responsibility to the Company or any Holder of Securities to determine when the Securities become convertible, the Conversion Rate, or whether any facts exist
which may require any adjustment of the Conversion Rate, or with respect to the nature or extent or calculation of any such adjustment when made, or with respect to the method employed in making the same. The Trustee and any other Conversion Agent
shall not be accountable with respect to the validity or value (or the kind or amount) of any shares of Common Stock, or of any securities or property, which may at any time be issued or delivered upon the conversion of any Security; and the Trustee
and any other Conversion Agent make no representations with respect thereto. Neither the Trustee nor any Conversion Agent shall be responsible for any failure of the Company to issue, transfer or deliver any cash or shares of Common Stock or stock
certificates or other securities or property upon the surrender of any Security for the purpose of conversion or to comply with any of the duties, responsibilities or covenants of the Company contained in this Article 9. Without limiting the
generality of the foregoing, neither the Trustee nor any Conversion Agent shall be under any responsibility to determine the correctness of any provisions contained in any supplemental indenture entered into pursuant to Section 9.04 relating
either to the kind or amount of shares of stock or securities or property (including cash) receivable by Holders upon the conversion of their Securities after any Reorganization Event or to any adjustment to be made with respect thereto, but,
subject to the provisions of Section 6.1 of the Original Indenture, may accept as conclusive evidence of the correctness of any such provisions, and shall be protected in relying upon, an Officer’s Certificate with respect thereto.

  

 45 

 Section 9.06. Stockholder Rights Plan. To the extent that the Company has a
rights plan in effect upon conversion of the Securities into Common Stock, the Holder will receive upon conversion of the Securities in respect of which the Company has elected to deliver Common Stock, if applicable, the rights under the rights
plan, unless prior to any conversion, the rights have separated from the Common Stock, in which case, and only in such case, the Conversion Rate will be adjusted at the time of separation as if the Company distributed to all holders of Common Stock
shares of the Company’s Capital Stock, evidences of indebtedness or assets as described in Section 9.02(c) above, subject to readjustment in the event of the expiration, termination or redemption of such rights. In lieu of any such
adjustment, the Company may amend such applicable stockholder rights agreement to provide that upon conversion of the Securities the Holders will receive, in addition to the Common Stock issuable upon such conversion, the rights which would have
attached to such Common Stock if the rights had not become separated from the Common Stock under such applicable stockholder rights agreement. 
 Section 9.07. No Stockholder Rights. For the avoidance of doubt, Holders of Securities will not have any rights as holders of Common Stock (including voting rights and rights to receive any
dividends or other distributions on the Common Stock) if and until the Securities are converted into shares of Common Stock. 
 Section 9.08. Withholding Taxes for Adjustments in Conversation Rate. If the Company pays withholding taxes on behalf of a Holder as a result of an adjustment to the Conversion Rate, the Company may, at its option, set off such
payments against payments of cash and shares of Common Stock on the Securities of such Holder. 
 ARTICLE 10 
 GUARANTEE OF SECURITIES 
 Section 10.01. Securities Guarantee. The Securities shall be fully and unconditionally guaranteed by the Guarantors and the
provisions of Article Fourteen of the Original Indenture shall apply to the Securities. 
 Section 10.02. Release of A
Guarantor; Termination Of Securities Guarantee. All Subsidiaries that from time to time guarantee any of the Company’s indebtedness shall be Guarantors hereunder. A Guarantor shall be deemed released and relieved from all its obligations
under its Securities Guarantee upon: 
 (a) a sale or other disposition (including by way of consolidation or merger) of such
Guarantor or the sale or disposition of all or substantially all the assets of such Guarantor; or 
 (b) discharge of the
Indenture with respect to the Securities as provided in Article 6 of this First Supplemental Indenture. 
 The Trustee
shall deliver an appropriate instrument evidencing any such release upon receipt of a request by the Company accompanied by an Officer’s Certificate and Opinion of Counsel certifying as to the compliance with this Section 10.02.

  

 46 

 Any Guarantor not released in accordance with this Section 10.02 remains liable for the
full amount of principal of and interest on the Securities as provided in the Securities and Article 14 of the Original Indenture. 
 ARTICLE 11 
 SECURITY DOCUMENTS 
 Section 11.01. Collateral and Security Documents. The Securities and the Securities Guarantee are secured as provided in the
Security Documents, subject to the terms of the Intercreditor Agreement. Each Holder (i) hereby consents to the subordination of the Liens securing the Securities and the Securities Guarantee on the terms set forth in the Intercreditor
Agreement, (ii) hereby agrees that it will be bound by and will take no actions contrary to the provisions of the Intercreditor Agreement and (iii) hereby authorizes and instructs the Collateral Agent to enter into the Intercreditor
Agreement and to subject the Securities and the Securities Guarantee and the Liens securing the Securities and the Securities Guarantee to the provisions thereof. The foregoing provisions are intended as an inducement to the Senior Obligations
Secured Parties (as defined the Intercreditor Agreement) to extend credit to the Company, and such Senior Obligations Secured Parties are intended third party beneficiaries of such provisions and the provisions of the Intercreditor Agreement. The
Company shall deliver to the Trustee (if it is not itself then the Collateral Agent) copies of all documents delivered to the Collateral Agent pursuant to the Security Documents, and will do or cause to be done all such acts and things as may be
required by the next sentence of this Section 11.01 to assure and confirm to the Collateral Agent the security interest in the Collateral contemplated hereby or by the Security Documents or any part thereof, as from time to time constituted, so
as to render the same available for the security and benefit of the Securities and the Securities Guarantee according to the intent and purposes herein expressed. The Company shall take, and shall cause the Guarantors to take, any and all actions
reasonably required to cause the Security Documents to create and maintain, as security for the Securities and the Securities Guarantee, valid and enforceable Liens on all material portions of the Collateral (subject to the terms of this First
Supplemental Indenture, the applicable Security Documents and the Intercreditor Agreement), in favor of the Collateral Agent for the benefit of the Holders, perfected to the extent contemplated by the applicable Security Documents and immediately
junior in priority in accordance with the Intercreditor Agreement (subject to other Permitted Collateral Liens) to any and all Liens at any time granted in the Collateral to secure the Priority Lien Obligations. 
 Section 11.02. Recording and Opinions. 
 (a) The Company will furnish to the Collateral Agent and the Trustee promptly (but in no event later than 20 Business Days) after the execution and delivery of this First Supplemental Indenture an Opinion
of Counsel either: 
 (1) stating that, in the opinion of such counsel, all action has been taken with respect to
the recording, registering and filing of the Indenture, financing statements or other instruments necessary to make effective the Liens intended to be created by the Security Documents, and reciting, with respect to the security interests in the
Collateral, the details of such action; or 
  

 47 

 (2) stating that, in the opinion of such counsel, no such action is
necessary to make such Liens effective. 
 (b) The Company will furnish to the Collateral Agent and the Trustee (if it is not
itself then the Collateral Agent) on or within one month of April 15 in each year beginning with April 15, 2010, an Opinion of Counsel either: 
 (1)(A) stating that, in the opinion of such counsel, such action has been taken with respect to the recording, registering, filing, re-recording, re-registering and re-filing of all supplemental
indentures, financing statements, continuation statements or other instruments of further assurance as is necessary to maintain the Liens of the Security Documents and reciting with respect to the security interests in the Collateral the details of
such action or referring to prior Opinions of Counsel in which such details are given, and (B) stating that, in the opinion of such counsel, based on relevant laws as in effect on the date of such Opinion of Counsel, all financing statements
and continuation statements have been executed and filed that are necessary as of such date and during the succeeding 12 months fully to preserve and protect, to the extent such protection and preservation are possible by filing, the rights of the
Holders and the Collateral Agent and the Trustee (if it is not itself then the Collateral Agent) hereunder and under the Security Documents with respect to the security interests in the Collateral; or 
 (2) stating that, in the opinion of such counsel, no such action is necessary to maintain such Liens. 
 (c) The Company will otherwise comply with the provisions of Section §314(b) of the Trust Indenture Act. 
 Section 11.03. Release of Collateral. 
 (a) Subject to subsections (b) and (c) of this Section 11.03, whether prior to or after the Discharge of Priority Lien Obligations, Collateral shall be released from the Liens created by
the Security Documents at any time or from time to time in accordance with the provisions hereof or of the Security Documents or the Intercreditor Agreement. Upon the request of the Company pursuant to an Officer’s Certificate or an Opinion of
Counsel (or both to the extent requested by the Collateral Agent) to the effect that all conditions precedent hereunder have been met, the Company and the Guarantors shall be entitled to a release of any assets included in the Collateral (but, in
the case of releases pursuant to clause (2) below, not on the proceeds of such assets, except to the extent such proceeds are applied to repay Priority Lien Obligations) from the Liens created by the Security Documents, and the Collateral Agent
shall release such assets (but, in the case of releases pursuant to clause (2) below, not on the proceeds of such assets, except to the extent such proceeds are applied to repay Priority Lien Obligations) from such Liens at the Company’s
sole cost and expense, under any one or more of the following circumstances: 
 (1) if all other Liens (other
than Permitted Collateral Liens described in clause (iii) of the definition thereof) on that asset securing Priority Lien Obligations then secured by that asset (including all commitments thereunder) are released; provided, however, that after
giving effect to the release, at least $5,000,000 of obligations secured

  

 48 

 
by Priority Liens on the remaining Collateral remain outstanding or committed and no Default or Event of Default with respect to the Securities shall have occurred and be continuing under the
Indenture as of the time of such proposed release; 
 (2) to enable the Company or any Guarantor to consummate
sales, transfers, leases or other dispositions of that asset (to a Person who is not the Company or Subsidiary), including any such transactions by the Credit Facilities Collateral Agent in connection with an exercise of remedies against the
Collateral on behalf of holders of any Priority Lien Obligations secured by such asset; 
 (3) if the Company or
any Guarantor provides substitute collateral with at least an equivalent fair value, as determined in good faith by the Board of Directors of the Company; 
 (4) if any Subsidiary that is a Guarantor is released from its Securities Guarantee, that Subsidiary’s assets shall also be released; or 
 (5) pursuant to an amendment, supplement or waiver in accordance with Article Nine of the Original Indenture and
Article 7 hereof. 
 Subject to the provisions of Section 11.03(b) below, upon receipt of any necessary or proper
instrument of termination, satisfaction or release prepared by the Company, the Collateral Agent shall, at the Company’s expense, execute, deliver or acknowledge such instruments to evidence the release of any Collateral required or permitted
to be released pursuant to this First Supplemental Indenture, the Security Documents or the Intercreditor Agreement. 
 (b)
Except as otherwise provided in the Intercreditor Agreement, no Collateral may be released from the Liens created by the Security Documents unless the Officer’s Certificate or Opinion of Counsel (or both to the extent requested by the
Collateral Agent) required by this Section 11.03, dated not more than 30 days prior to the date of the application for such release, has been delivered to the Collateral Agent and the Trustee (if it is not itself then the Collateral Agent).

 (c) At any time when an Event of Default with respect to the Securities has occurred and is continuing and the maturity of
the Securities has been accelerated (whether by declaration or otherwise) and the Trustee (if it is not itself then the Collateral Agent) has delivered a notice of acceleration to the Collateral Agent, no release of Collateral pursuant to the
provisions of this First Supplemental Indenture or the Security Documents will be effective as against the Holders, except as otherwise provided in the Intercreditor Agreement. 
 Section 11.04 Certificates of the Company. 
 (a) The Company will furnish to the Collateral Agent and the Trustee (if it is not itself then the Collateral Agent), prior to each proposed release of Collateral from the Liens created by the Security
Documents: 
 (1) all documents required by Section §314(d) of the Trust Indenture Act; and 

 

 49 

 (2) an Opinion of Counsel to the effect that such accompanying documents
constitute all documents required by Section §314(d) of the Trust Indenture Act. 
 The Trustee may, to the extent
permitted by Sections 6.1 and 6.3 of the Original Indenture, accept as conclusive evidence of compliance with the foregoing provisions the appropriate statements contained in such documents and such Opinion of Counsel. 
 Section 11.05. Permitted Releases Not to Impair Lien; Trust Indenture Act Requirements. The release of any Collateral from the
Security Documents or the release of, in whole or in part, the Liens created by the Security Documents, will not be deemed to impair any Lien on the Collateral in contravention of the provisions of the Indenture if and to the extent the Collateral
or Liens are released pursuant to the applicable Security Documents or the Intercreditor Agreement or pursuant to the terms of this Article 11. The Trustee and each of the Holders acknowledge that a release of Collateral or a Lien strictly in
accordance with the terms of the Security Documents or the Intercreditor Agreement or of this Article 11 will not be deemed for any purpose to be an impairment of the Lien on the Collateral in contravention of the terms of the Indenture. To the
extent applicable, the Company will cause Section 314(d) of the Trust Indenture Act, relating to the release of property or securities or relating to the substitution therefor of any property or securities to be subjected to the Lien of the
Security Documents, to be complied with. Any certificate or opinion required by Section 314(d) of the Trust Indenture Act may be made by an Officer of the Company except in cases where Section 314(d) of the Trust Indenture Act requires
that such certificate or opinion be made by an independent Person, which Person shall be an independent engineer, appraiser or other expert selected by or reasonably satisfactory to the Collateral Agent. Fees, charges and expenses incurred by the
Trustee or the Collateral Agent in connection herewith, including the fees and expenses of any such engineer, appraiser or other expert, shall be reimbursed by the Company to the Trustee or the Collateral Agent (as applicable). 
 Notwithstanding anything to the contrary in Section 11.04 or in this Section 11.05, the Company will not be required to comply
with all or any portion of Section 314(d) of the Trust Indenture Act if it determines, in good faith based on advice of counsel, and upon such determination furnishes to the Trustee an Officer’s Certificate or Opinion of Counsel certifying
such determination, that the terms of Section 314(d) of the Trust Indenture Act or any interpretation or guidance as to the meaning thereof of the SEC and its staff, including “no action” letters or exemptive orders, whether or not
issued to the Company by the SEC, or any portion of Section 314(d) of the Trust Indenture Act is inapplicable to one or a series of released Collateral. 
 Section 11.06. Certificate of the Trustee. In the event that the Company elects to release Collateral in accordance with this First Supplemental Indenture or the Security Documents at a time
when the Trustee is not itself also the Collateral Agent and the Company has delivered the certificates and documents required by the Security Documents and Sections 11.03 and 11.04 hereof, the Trustee shall determine whether it has received
all documentation required by Section 314(d) in connection with such release and, based on such determination, shall deliver a certificate to the Collateral Agent setting forth such determination. 
  

 50 

 Section 11.07. Enforcement of Security Documents and Protection of Collateral.
Subject to the provisions of Articles Five and Six of the Original Indenture and of the Security Documents and Intercreditor Agreement, the Trustee in its sole discretion and without the consent of any Holder, on behalf of the Holders, may or
may direct the Collateral Agent to take all actions it deems necessary or appropriate in order to: 
 (1) enforce any of the
terms of the Security Documents; and 
 (2) collect and receive any and all amounts payable in respect of the Securities or the
Securities Guarantee thereunder. 
 Subject to the provisions of Articles Five and Six of the Original Indenture and of the
Security Documents and the Intercreditor Agreement, the Trustee shall have power to institute and to maintain such suits and proceedings as it may deem expedient to prevent any impairment of the Collateral by any acts which may be unlawful or in
violation of any of the Security Documents or this First Supplemental Indenture, and such suits and proceedings as the Trustee, in its sole discretion, may deem expedient to preserve or protect its interests and the interests of the Holders in the
Collateral (including power to institute and maintain suits or proceedings to restrain the enforcement of or compliance with any legislative or other governmental enactment, rule or order that may be unconstitutional or otherwise invalid if the
enforcement of, or compliance with, such enactment, rule or order would impair the Lien on the Collateral of the Security Documents or be prejudicial to the interests of the Holders, the Collateral Agent or the Trustee under the Security Documents
or this First Supplemental Indenture). 
 Section 11.08. Authorization of Receipt of Funds by Trustee Under the Security
Documents. Subject to the provisions of the Intercreditor Agreement, the Trustee is authorized to receive any funds for the benefit of the Holders distributed under the Security Documents, and to make further distributions of such funds to such
Holders according to the provisions of the Indenture. 
 Section 11.09. Collateral Agent. 
 (a) The Trustee shall initially act as Collateral Agent and shall be authorized to appoint co-Collateral Agents as necessary in its sole
discretion. Except as otherwise explicitly provided in the Indenture, the Security Documents or the Intercreditor Agreement, neither the Collateral Agent nor any of its respective officers, directors, employees or agents shall be liable for failure
to demand, collect or realize upon any of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof. The Collateral Agent shall be accountable only for amounts that it actually receives as a result of the exercise of such powers, and neither the Collateral Agent nor any of its officers, directors,
employees or agents shall be responsible for any act or failure to act under the Indenture or the Security Documents, except for its own willful misconduct, negligence or bad faith. 
 (b) The Trustee, as Collateral Agent, is authorized and directed to (i) enter into the Security Documents, (ii) enter into the
Intercreditor Agreement, (iii) bind the Holders on the terms as set forth in the Security Documents and the Intercreditor Agreement and (iv) perform and observe its obligations under the Security Documents and the Intercreditor Agreement.

  

 51 

 (c) If the Company or any Subsidiary (i) incurs Priority Lien Obligations at any time
when no Intercreditor Agreement is in effect or at any time when Priority Lien Obligations entitled to the benefit of an existing Intercreditor Agreement are concurrently retired, and (ii) delivers to the Collateral Agent an Officers’
Certificate so stating and requesting the Collateral Agent to enter into an Intercreditor Agreement in favor of a designated agent or representative for the holders of the Priority Lien Obligations so incurred, the Collateral Agent shall (and is
hereby authorized and directed to) enter into such Intercreditor Agreement, bind the Holders on the terms set forth therein, and perform and observe its obligations thereunder. 
 Section 11.10. Designations. Except as provided in the next sentence, for purposes of the provisions hereof permitting or
requiring the Company to designate any Lien on any Collateral as a “Priority Lien” hereunder, any such designation shall be sufficient if the relevant designation is set forth in writing, signed on behalf of the Company by an Officer
thereof and delivered to the Trustee and the Collateral Agent. For all purposes hereof, the Company hereby designates the Liens on the Collateral securing the Credit Agreement Indebtedness incurred or arising under or in respect of the Credit
Agreement as in effect on the Issue Date as “Priority Liens” hereunder. 
 Section 11.11. Termination of
Liens. The Trustee will, at the written request of the Company, instruct the Collateral Agent to release the Liens granted by the Security Documents upon satisfaction and discharge of the Indenture with respect to the Securities as described in
Article 6. Upon receipt of such instruction and any necessary or proper instruments of termination, satisfaction or release prepared by the Company, the Collateral Agent shall execute, deliver or acknowledge any such instruments or releases to
evidence the release of such Liens. 
 Section 11.12. Excluded Securities. Notwithstanding anything to the contrary
provided in this First Supplemental Indenture (including without limitation Sections 3.06 and 11.01 hereof) or any of the Security Documents, (i) the Collateral shall at no time include any Capital Stock or other securities of any
Subsidiary of the Company that constitute Excluded Securities, and (ii) any portion of the Excluded Securities may continue to secure any Priority Lien Obligations. The Security Documents may be amended or modified, without the consent of any
Holder, from time to time to the extent necessary to release the Liens on any Excluded Securities. 
 Section 11.13.
Automatic Waiver of Covenants in Security Documents. In the event that the requisite holders of the Priority Lien Obligations (or any representatives thereof) waive or amend any covenant in a Priority Lien Obligation Security Document, the
corresponding covenant in any Security Document will automatically be deemed waived or amended to the same extent; provided, however, that after giving effect to the waiver or amendment, at least $5,000,000 of Priority Lien Obligations remain
outstanding or committed. 
  

 52 

 ARTICLE 12 
 MISCELLANEOUS 
 Section 12.01. Compliance with Trust
Indenture Act. In addition to the Company’s reporting obligations set forth in Section 7.4 of the Original Indenture, the Company shall also comply with the provisions of Section 314(a) of the Trust Indenture Act. 
 Section 12.02. No Defeasance. The provisions of Article Thirteen of the Original Indenture shall not apply to any Securities
issued under this First Supplemental Indenture. 
 Section 12.03. Communication by Holders with other Holders.
Holders may communicate pursuant to Section 312(b) of the Trust Indenture Act with other Holders with respect to their rights under this First Supplemental Indenture or the Securities. The Company, the Trustee, the Registrar and anyone else
shall have the protection of Section 312(c) of the Trust Indenture Act. 
 Section 12.04. Rules by Trustee, Paying
Agent and Registrar. The Trustee may make reasonable rules for action by, or a meeting of, Holders. The Registrar and the Paying Agent may make reasonable rules for their functions. 
 Section 12.05. Governing Law. THIS FIRST SUPPLEMENTAL INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 
 Section 12.06. No Recourse Against Others. An incorporator,
director, officer, employee, partner or stockholder of the Company or any Guarantor, solely by reason of this status, shall not have any liability for any obligations of the Company or such Guarantor under the Securities, the Indenture or the
Security Documents or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Security, each Holder shall waive and release all such liability. The waiver and release shall be part of the
consideration for the issue of the Securities. 
 Section 12.07. Successors. All agreements of the Company in this
First Supplemental Indenture and the Securities shall bind its successors. All agreements of the Trustee in this First Supplemental Indenture shall bind its successors. 
 Section 12.08. Multiple Originals. The parties may sign any number of copies of this First Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the
same agreement. One signed copy is enough to prove this First Supplemental Indenture. 
 Section 12.09. Table of
Contents; Headings. The table of contents, cross-reference sheet and headings of the Articles and Sections of this First Supplemental Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof
and shall not modify or restrict any of the terms or provisions hereof. 
 Section 12.10. Severability Clause. In
case any provision in this First Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and such provision shall
be ineffective only to the extent of such invalidity, illegality or unenforceability. 
  

 53 

 Section 12.11. Calculations. Except as otherwise provided herein, the Company
will be responsible for making all calculations called for under the Indenture and the Securities. The Company will make all such calculations in good faith and, absent manifest error, its calculations will be final and binding on Holders. The
Company will provide a schedule of its calculations to each of the Trustee and the Conversion Agent, and each of the Trustee and Conversion Agent is entitled to rely conclusively upon the accuracy of the Company’s calculations without
independent verification. The Trustee will deliver a copy of such schedule to any Holder upon the request of such Holder. 
 Section 12.12. Ratification and Incorporation of Original Indenture. As supplemented hereby, the Original Indenture is in all respects ratified and confirmed, and the Original Indenture and this First Supplemental Indenture
shall be read, taken and construed as one and the same instrument. 
 [Remainder of the page intentionally left blank] 

  

 54 

 IN WITNESS WHEREOF, the parties have caused this First Supplemental Indenture to be duly
executed as of the date first written above. 
  

			
	FLOTEK INDUSTRIES, INC.
		
	By:	 	 /s/ John Chisholm

		 	Name: John Chisholm
		 	Title: President
	
	 U.S. BANK NATIONAL ASSOCIATION, as Trustee

		
	By:	 	 /s/ Steven A. Finklea

		 	Name: Steven A. Finklea
		 	Title: Vice President

  

			
	 GUARANTORS:
  
 TELEDRIFT COMPANY
 FLOTEK PAYMASTER,
INC.
 MATERIAL TRANSLOGISTICS, INC.
 PETROVALVE, INC.
 TURBECO, INC.
 USA PETROVALVE, INC.
 FLOTEK INTERNATIONAL, INC.
 PADKO INTERNATIONAL INCORPORATED
 FLOTEK
ECUADOR MANAGEMENT, LLC
 FLOTEK ECUADOR INVESTMENTS, LLC

		
	By:	 	 /s/ John Chisholm

		 	Name: John Chisholm
		 	Title: President

			
	 SOONER ENERGY SERVICES, LLC
 CESI MANUFACTURING, LLC
 CESI CHEMICAL, INC.

		
	By:	 	 /s/ John Chisholm

		 	Name: John Chisholm
		 	Title: Chief Executive Officer

  

			
	FLOTEK INDUSTRIES FZE
		
	By:	 	 /s/ John Chisholm

		 	Name: John Chisholm
		 	Title: President

 EXHIBIT A 
 [FORM OF FACE OF SECURITY] 
 FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT AND THE ISSUE DATE OF THIS SECURITY IS MARCH 31, 2010. A HOLDER MAY OBTAIN THE ISSUE PRICE, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT, THE ISSUE DATE AND THE
YIELD TO MATURITY FOR THE SECURITIES BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION TO FLOTEK INDUSTRIES, INC., 2930 WEST SAM HOUSTON PARKWAY NORTH, SUITE 300, HOUSTON, TX 77043, ATTENTION: CHIEF FINANCIAL OFFICER. 
 [IF THE SECURITIES ARE SUBJECT TO TRANSFER RESTRICTIONS: THIS SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED
BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE FORM AND SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE ISSUER, THE REGISTRAR AND THE TRANSFER AGENT. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT.] 
  

 A-1 

 No. [    ] Principal Amount
$[            ]. 
 5.25% Convertible Senior Secured Notes due 2028

 Flotek Industries, Inc., a Delaware corporation, promises to pay to
[            ], or registered assigns, the principal sum of [            ] Dollars on February 15, 2028. 
  

			
	Interest Payment Dates:	  	February 15 and August 15
	Regular Record Dates:	  	February 1 and August 1

 Additional
provisions of this Security are set forth on the attached “Terms of Securities.” 
 Dated:
[            ] 
 IN WITNESS WHEREOF, the Company has caused this
Note to be duly executed. 
  

			
	FLOTEK INDUSTRIES, INC.
		
	By:	 	  

		 	Name:
		 	Title:

  

 A-2 

 Each of the Guarantors (which term includes any successor Person in such capacity under the
Indenture), has fully, unconditionally and absolutely guaranteed, to the extent set forth in the Indenture and subject to the provisions in the Indenture, the due and punctual payment of the principal of, and premium, if any, and interest on the
Securities and all other amounts due and payable under the Indenture and the Securities by the Company. 
 The obligations of
the Guarantors to the Holders of Securities and to the Trustee pursuant to the Securities Guarantee and the Indenture are expressly set forth in Article 10 of the First Supplemental Indenture and Article Fourteen of the Original Indenture and
reference is hereby made to the Indenture for the precise terms of the Securities Guarantee. 
  

			
	 TELEDRIFT COMPANY
 FLOTEK PAYMASTER, INC.
 MATERIAL TRANSLOGISTICS, INC.
 PETROVALVE, INC.
 TURBECO, INC.
 USA PETROVALVE, INC.
 FLOTEK
INTERNATIONAL, INC.
 PADKO INTERNATIONAL INCORPORATED
 FLOTEK ECUADOR MANAGEMENT, LLC
 FLOTEK ECUADOR INVESTMENTS, LLC

		
	By:	 	  

		 	Name: John Chisholm
		 	Title: President

  

			
	 SOONER ENERGY SERVICES, LLC
 CESI MANUFACTURING, LLC
 CESI CHEMICAL, INC.

		
	By:	 	  

		 	Name: John Chisholm
		 	Title: Chief Executive Officer

  

			
	FLOTEK INDUSTRIES FZE
		
	By:	 	  

		 	Name: John Chisholm
		 	Title: President

  

 A-3 

 TRUSTEE’S CERTIFICATE OF AUTHENTICATION 
 U.S. BANK NATIONAL ASSOCIATION 
 as Trustee, certifies that this is one of the Securities referred
to in the Indenture. 
  

			
	By:	 	  

		 	 Authorized Signatory

  

 A-4 

 TERMS OF SECURITIES 
 5.25% Convertible Senior Secured Notes due 2028 
 The
Company issued this Security under an Indenture dated as of March 31, 2010 (the “Original Indenture”), among the Company, the guarantors party thereto and the Trustee, as supplemented by the First Supplemental Indenture dated
as of March 31, 2010 (the “First Supplemental Indenture”), among the Company, the guarantors party thereto and the Trustee (the Original Indenture, as supplemented by the First Supplemental Indenture, the
“Indenture”), to which reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the Holders. 
  

	 	1.	Interest 

 Flotek Industries,
Inc., a Delaware corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest on the principal amount of this Security at the
rate of 5.25% per annum until the principal hereof is paid or made available for payment. 
 The Company will pay interest
semiannually in arrears on February 15 and August 15 of each year (each, an “Interest Payment Date”), commencing August 15, 2010, to Holders of record on the immediately preceding February 1 and August 1.
Interest on the Securities will accrue from the most recent date to which interest has been paid on the Securities or, if no interest has been paid, from March 31, 2010. Interest will be computed on the basis of a 360-day year of twelve 30-day
months. 
  

	 	2.	Contingent Interest 

 Subject to
the accrual and record date provisions described above, the Company will pay Contingent Interest to the Holders of the Securities during any six-month period from an Interest Payment Date to, but excluding, the following Interest Payment Date,
commencing with the six-month period beginning on February 15, 2013, if the Trading Price of the Securities for each of the five Trading Days ending on the third Trading Day immediately preceding the first day of the relevant six-month period
equals 120% or more of the principal amount of the Securities. 
 The amount of Contingent Interest payable per each $1,000
principal amount of Securities with respect to any six-month period will equal 0.50% per annum of the average Trading Price of the Securities for the five Trading Days referred to above. 
 Upon determination that Holders of the Securities will be entitled to receive Contingent Interest that will become payable during a relevant
six-month period, on or prior to the start of such six-month period, the Company will provide an Officer’s Certificate to the Trustee setting forth the amount of contingent interest per $1,000 principal amount of the Securities and disseminate
a press release through a public medium that is customary for such press releases. 
 The Company may cause to be withheld from
any payment hereunder any tax withholding required by law or regulations, including, in the case of any withholding obligation arising from income that does not give rise to any cash or property from which any applicable withholding tax could be
satisfied, set off against any subsequent payment of cash or property hereunder. 
  

 A-5 

 The Company may unilaterally increase the amount of Contingent Interest it may pay or
interest or other amounts it is obligated to pay, but the Company will have no obligation to do so. 
  

	 	3.	Method of Payment 

 By no later
than 11:00 a.m. (New York City time) on the date on which any principal of, interest (including Contingent Interest and Additional Interest, if any) or premium, if any, on any Security is due and payable, the Company shall deposit with the
Paying Agent money sufficient to pay such amount. The Company will pay principal, premium and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. The Company will pay principal
of Securities at the office or agency designated by the Company for such purpose. Interest (including Contingent Interest and Additional Interest, if any) on Securities will be payable (i) to Holders having an aggregate principal amount of
$5,000,000 or less, by check mailed to the Holders of these Securities and (ii) to Holders having an aggregate principal amount of more than $5,000,000, either by check mailed to each Holder or, upon application by a Holder to the Registrar not
later than the relevant record date, by wire transfer in immediately available funds to that Holder’s account within the United States, which application shall remain in effect until the Holder notifies, in writing, the Registrar to the
contrary. 
  

	 	4.	Redemption 

 Subject to certain
conditions specified in the Indenture, the Securities will be redeemable, at the option of the Company, in whole at any time or in part from time to time, at any time on or after February 15, 2013 and at a price equal to 100% of the principal
amount of Securities to be redeemed, plus accrued and unpaid interest (including Contingent Interest and Additional Interest, if any) to but excluding the Redemption Date (unless the Redemption Date is between a Regular Record Date and the Interest
Payment Date to which it relates, in which case the Company will pay accrued and unpaid interest to the Holder of record on such Regular Record Date). 
  

	 	5.	Sinking Fund 

 The Securities
are not subject to any sinking fund. 
  

	 	6.	Purchase by the Company at the Option of the Holder; Purchase at the Option of the Holder Upon a Fundamental Change 

 (a) Subject to the terms and conditions of the Indenture, a Holder shall have the option to require the Company to purchase all or a portion
of its Securities held by such Holder on each of February 15, 2013, February 15, 2018 and February 15, 2023 at a Purchase Price specified in the Indenture. 
 (b) If a Fundamental Change shall occur at any time, each Holder shall have the right, at such Holder’s option and subject to the terms and conditions of the Indenture, to require the Company to
purchase all or a portion of its Securities at a Fundamental Change Purchase Price specified in the Indenture. 
  

 A-6 

	 	7.	Conversion 

 Subject to the
limitations in Section 9.01(h) of the Indenture, a Holder may convert its Securities prior to January 15, 2028 in accordance with the procedures for conversion set forth in the Indenture only when one or more of the conditions specified in
the Indenture are met and during the related specified period. Subject to the limitations in Section 9.01(h) of the Indenture, on or after January 15, 2028, a Holder may convert its Securities in accordance with the procedures for
conversion set forth in the Indenture until the close of business on the second Business Day immediately preceding Stated Maturity regardless of such conditions specified in the Indenture. 
 The initial Conversion Rate is 43.9560 shares of Common Stock per $1,000 principal amount of Securities, subject to adjustment in certain
events described in the Indenture. Upon conversion, the Company will either (i) deliver shares of Common Stock based on the Conversion Rate or (ii) pay cash and shares of Common Stock, if any, as set forth in the Indenture. The Company
shall deliver cash in lieu of any fractional share of Common Stock. 
 A Holder may convert a portion of the Securities only if
the principal amount of such portion is $1,000 or a multiple of $1,000. No payment or adjustment shall be made for dividends on the Common Stock except as provided in the Indenture. 
  

	 	8.	Denominations; Transfer; Exchange 

 The Securities are in registered form without coupons in denominations of principal amount of $1,000 and multiples of $1,000. A Holder may transfer or exchange Securities in accordance with the Indenture. The Registrar may require a Holder,
among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not register the transfer of or exchange of Securities (i) selected
for redemption or, if a portion of any Security is selected for redemption, the portion thereof selected for redemption; (ii) surrendered for conversion or, if a portion of any Security is surrendered for conversion, the portion thereof
surrendered for conversion; or (iii) in certificated form for a period of 15 days prior to mailing a notice of redemption under Article 4 of the First Supplemental Indenture and Article Eleven of the Original Indenture. 
  

	 	9.	Persons Deemed Owners 

 The
registered Holder of this Security may be treated as the owner of it for all purposes. 
  

	 	10.	Unclaimed Money 

 If money for
the payment of principal, premium, if any, or interest (including Contingent Interest and Additional Interest, if any) remains unclaimed for one year, the Trustee or Paying Agent shall pay the money back to the Company, subject to applicable
abandoned property laws. After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment. 
  

 A-7 

	 	11.	Amendment, Waiver 

 Subject to
certain exceptions, the Indenture contains provisions permitting an amendment of the Indenture, the Securities, the Securities Guarantee, the Security Documents and the Intercreditor Agreement with the written consent of the Holders of at least a
majority in principal amount of the then outstanding Securities and the waiver of any Event of Default (other than with respect to nonpayment or in respect of a provision that cannot be amended without the written consent of each Holder affected) or
noncompliance with any provision with the written consent of the Holders of a majority in principal amount of the then outstanding Securities. 
 In addition, the Indenture permits an amendment of the Indenture, the Securities, the Securities Guarantee, the Security Documents and the Intercreditor Agreement without the consent of any Holder under
certain circumstances specified in the Indenture. 
  

	 	12.	Defaults and Remedies 

 Subject
to the following paragraph, if an Event of Default specified in the Indenture occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the Securities may declare all the Securities by notice to the Company to be
due and payable immediately. In addition, certain specified Events of Default will cause the Securities to become immediately due and payable without further action by the Holders. 
 The sole remedy for an Event of Default relating to the Company’s failure to comply with the reporting obligations under
Section 12.01 of the First Supplemental Indenture, and for any failure to comply with the requirements of Section 314(a)(1) of the Trust Indenture Act, will for the 365 days after the occurrence of such an Event of Default consist
exclusively of the right to receive Additional Interest on the principal amount of the Securities at a rate equal to 0.25% per annum. 
 Holders may not enforce the Indenture, the Securities, the Securities Guarantee or the Security Documents except as provided in the Indenture. The Trustee may refuse to enforce the Indenture, the
Securities, the Securities Guarantee and the Security Documents unless it receives reasonable indemnity or security. Subject to certain limitations, Holders of a majority in principal amount of the Securities may direct the Trustee in its exercise
of any trust or power. The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a Default or Event of Default in payment of principal, interest (including Contingent Interest and Additional Interest, if any)
or premium, if any) if it determines that withholding notice is in their interest. 
  

	 	13.	Security Documents. 

 The
Securities and the Securities Guarantee are secured on a second-priority basis (subject to Permitted Collateral Liens) by the Liens created by the Security Documents, subject to the terms of the Indenture, the Security Documents and the
Intercreditor Agreement. 
  

 A-8 

	 	14.	Trustee Dealings with the Company 

 Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with and collect obligations owed to
it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. 
  

	 	15.	No Recourse Against Others 

 An
incorporator, director, officer, employee, partner, sponsor or stockholder of the Company or any Guarantor, solely by reason of this status, shall not have any liability for any obligations of the Company or such Guarantor under the Securities, the
Indenture or the Security Documents or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Security, each Holder waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities. 
  

	 	16.	Authentication 

 This Security
shall not be valid until an authorized signatory of the Trustee manually authenticates this Security. 
  

	 	17.	Abbreviations 

 Customary
abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and
U/G/M/A (=Uniform Gift to Minors Act). 
  

	 	18.	Governing Law 

 This Security
and the Indenture shall be governed by, and construed in accordance with, the laws of the State of New York. 
 The Company
will furnish to any Holder upon written request and without charge to the Holder a copy of the Indenture which has in it the text of this Security. Requests may be made to: 
 Flotek Industries, Inc. 
 2930 West Sam Houston Parkway North, Suite 300 
 Houston, TX 77043 
 Attention: Chief Financial Officer 
 Facsimile: (713) 466-8386 
  

 A-9 

 ASSIGNMENT FORM 
 To assign this Security, fill in the form below: 
 I or we
assign and transfer this Security to 
  
  

(Print or type assignee’s name, address and zip code) 
  
  
 (Insert assignee’s soc. sec. or tax I.D. No.) 
 and
irrevocably appoint              agent to transfer this Security on the books of the Company. The agent may substitute another to act for him. 
 [FOR INCLUSION ONLY IF THE SECURITY BEARS A RESTRICTED SECURITIES LEGEND: In connection with the transfer of this Security, the undersigned confirms
that this Security is being transferred: 
 CHECK ONE BOX BELOW: 
  

	(1)	[    ] to the Company; 

  

	(2)	[    ] pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended (the “Act”);

  

	(3)	[    ] pursuant to and in compliance with Regulation S under the Act; 

  

	(4)	[    ] pursuant to and in compliance with Rule 144 under the Act; 

  

	(5)	[    ] pursuant to and in compliance with another available exemption from, or in a transaction not subject to, the registration requirements of the
Act; or 

  

	(6)	[    ] pursuant to and in compliance with a currently effective Registration Statement under the Act. 

 Unless one of the boxes is checked the Registrar will refuse to register this Security in the name of any person other than the registered holder hereof. In
addition the Company or the Registrar may require, prior to registering any such transfer of this Security, such certifications, other information and legal opinions as are reasonably necessary or desirable to confirm that such transfer is being
made in accordance with the registration requirements of the Act, or a valid exemption therefrom. 
  
  
  

									
	Date:	 	  
	 		 	Your Signature:	 	  

  

			
	Signature Guarantee:	 	  

		 	 (Signature must be guaranteed)

  

			
	  
	  	
	Sign exactly as your name appears on the other side of this Security.	  	

 The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and
loan associations and credit unions) with membership in an approved signature guarantee medallion program, pursuant to S.E.C. Rule 17Ad-15. 
  

					
		 		 	  

		 		 	Signature:
			
	Signature Guarantee:	 		 	
			
	  
	 		 	  

	(Signature must be guaranteed)	 		 	Signature:

 The signature(s) should be guaranteed by an
eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions) with membership in an approved signature guarantee medallion program, pursuant to S.E.C. Rule 17Ad-15. 

 FORM OF RULE 144(b)(1) NOTICE 
  

	To:	Registrar of Flotek Industries, Inc. 5.25% Convertible Senior Secured Notes due 2028 

 The undersigned registered Holder of this Security hereby notifies the Registrar that such Holder is eligible to sell or transfer this
Security pursuant to Rule 144(b)(1) under the Securities Act of 1933, as amended (the “Act”), and hereby requests the Registrar issue and register in the name of the Holder a replacement Security that does not bear a legend
restricting the transfer of the Securities under the Act. 
  

					
	Dated:	 		 	  

		 		 	  

		 		 	Signature(s)
		 		 	The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions) with membership in an approved
signature guarantee medallion program, pursuant to S.E.C. Rule 17Ad-15.
		 		 	  

		 		 	Signature Guarantee

 FORM OF CONVERSION NOTICE 
  

	To:	Flotek Industries, Inc. 

 The
undersigned registered Holder of this Security hereby exercises the option to convert this Security, or portion hereof (which is $1,000 principal amount or a multiple thereof) designated below in accordance with the terms of the Indenture referred
to in this Security, and directs that cash, and the shares of Common Stock of Flotek Industries, Inc., if any, issuable and deliverable upon such conversion, and any Securities representing any unconverted principal amount hereof, be issued and
delivered to the registered Holder hereof unless a different name has been indicated below. If cash, shares or any portion of this Security not converted are to be issued in the name of a Person other than the undersigned, the undersigned shall pay
all transfer taxes payable with respect thereto. 
 This notice shall be deemed to be an irrevocable exercise of the option to
convert this Security. 
  

					
	Dated:	 		 	  

		 		 	  

		 		 	Signature(s)
		 		 	The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions) with membership in an approved
signature guarantee medallion program, pursuant to S.E.C. Rule 17Ad-15.
		 		 	  

		 		 	Signature Guarantee
	Fill in if cash or shares are to be issued, or Securities are to be issued, other than to and in the name of registered holder:	 		 	
	  
	 		 	
	(Name)	 		 	Principal amount to be converted (if less than all): $            ,000
	  
	 		 	
	(Street Address)	 		 	
			
	  
	 		 	  

	(City state and zip code)	 		 	Social Security or Other Taxpayer Number
	Please print name and address	 		 	

 FORM OF FUNDAMENTAL CHANGE PURCHASE NOTICE 
  

	To:	Flotek Industries, Inc. 

 The
undersigned registered Holder of this Security hereby acknowledges receipt of a notice from Flotek Industries, Inc. (the “Company”) as to the occurrence of a Fundamental Change with respect to the Company and requests and instructs
the Company to repurchase this Security, or the portion hereof (which is $1,000 principal amount or a multiple thereof) designated below, in accordance with the terms of the Indenture referred to in this Security and directs that the check in
payment for this Security or the portion thereof and any Securities representing any unrepurchased principal amount hereof, be issued and delivered to the registered Holder hereof unless a different name has been indicated below. If any portion of
this Security not repurchased is to be issued in the name of a Person other than the undersigned, the undersigned shall pay all transfer taxes payable with respect thereto. 
  

					
	Dated:	 		 	  

		 		 	  

		 		 	Signature(s)
		 		 	The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions) with membership in an approved
signature guarantee medallion program, pursuant to S.E.C. Rule 17Ad-15.
		 		 	  

	Fill in if a check is to be issued, or Securities are to be issued, other than to and in the name of registered Holder:	 		 	Signature Guarantee
	  
	 		 	
	(Name)	 		 	 Principal amount to be purchased
 (if less than all): $            ,000

	  
	 		 	
	(Street Address)	 		 	
	  
	 		 	  

	(City state and zip code)	 		 	Social Security or Other Taxpayer Number
	Please print name and address	 		 	

 FORM OF PURCHASE NOTICE 
  

	To:	Flotek Industries, Inc. 

 The
undersigned registered Holder of this Security hereby acknowledges receipt of a notice from Flotek Industries, Inc. (the “Company”) as to the Holder’s option to require the Company to repurchase this Security and requests and
instructs the Company to repurchase this Security, or the portion hereof (which is $1,000 principal amount or a multiple thereof) designated below, in accordance with the terms of the Indenture referred to in this Security and directs that the check
in payment for this Security or the portion thereof and any Securities representing any unrepurchased principal amount hereof, be issued and delivered to the registered Holder hereof unless a different name has been indicated below. If any portion
of this Security not repurchased is to be issued in the name of a Person other than the undersigned, the undersigned shall pay all transfer taxes payable with respect thereto. 
  

					
	Dated:	 		 	  

		 		 	  

		 		 	Signature(s)
		 		 	The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions) with membership in an approved
signature guarantee medallion program, pursuant to S.E.C. Rule 17Ad-15.
		 		 	  

	Fill in if a check is to be issued, or Securities are to be issued, other than to and in the name of registered Holder:	 		 	Signature Guarantee
	  
	 		 	
	(Name)	 		 	 Principal amount to be purchased
 (if less than all): $            ,000

	  
	 		 	
	(Street Address)	 		 	
	  
	 		 	  

	(City state and zip code)	 		 	Social Security or Other Taxpayer Number
	Please print name and addressExchange Agreement dated as of March 31, 2010

 Exhibit 10.1 
 FLOTEK INDUSTRIES, INC. 
 EXCHANGE AGREEMENT 

 This Exchange Agreement (this “Agreement”) is made as of March 31, 2010 by and among Flotek Industries,
Inc., a Delaware corporation with its principal office at 2930 W. Sam Houston Parkway North, Suite 300, Houston, Texas 77043 (the “Company”), the guarantors listed on the signature pages hereto (each a “Guarantor”
and together the “Guarantors”) and the investors listed on the attached Exhibit A (each an “Investor”, and collectively, the “Investors”). 
 RECITALS 
 A. The Company has authorized and outstanding $115 million principal amount of senior unsecured convertible notes (the “2008 Notes”) issued pursuant to an indenture dated
February 14, 2008, as supplemented by the first supplemental indenture dated February 14, 2008 (the “2008 Supplement”). 
 B. The Investors hold 2008 Notes in the amounts listed on Exhibit A, among others. 
 C. In connection that certain Amended and Restated Credit Agreement, dated as of the date hereof (the “Amended Credit Agreement”), the Company and the Investors wish for the Investors to exchange, in accordance with this
Agreement, their 2008 Notes for shares of common stock, par value $0.0001 per share, of the Company (the “Common Stock”), senior secured convertible notes (the “2010 Notes”) to be issued pursuant to an indenture in
the form of Exhibit B and a first supplemental indenture in the form of Exhibit C (the “2010 Supplement” and together with the indenture, the “Indenture”), to which the Guarantors are parties and cash
for accrued and unpaid interest on the exchanged 2008 Notes. 
 D. The issuance by the Company of the Common Stock and the 2010
Notes in exchange for the 2008 Notes is intended to be exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). 
 E. Contemporaneously with entry into this Agreement, the Company and the Investors are entering into a Registration Rights Agreement (the
“Registration Rights Agreement”) with respect to the 2010 Notes, the Exchange Shares (as hereinafter defined) and the Conversion Shares (as hereinafter defined). 
 TERMS AND CONDITIONS 
 Now, therefore, in consideration of the foregoing recitals and the mutual covenants and agreements contained herein, the parties hereto, intending to be legally bound, do hereby agree as follows:

 1. Exchange of the Securities. 
 1.1 Agreement to Exchange At the Closing (as hereinafter defined), each Investor will deliver to the Company the 2008 Notes in the principal amounts set forth opposite such Investor’s name on
Exhibit A, and the Company will (a) pay to each Investor cash in the amount of accrued and upaid interest up to (but not including) the Closing Date on the 2008 Notes being exchanged by such Investor; and (b) issue and deliver to
each Inventor, for each $1,000 principal amount of 2008 Notes being exchanged by such Investor, (i) Common Stock (the “Exchange Shares” and together with the 2010 Notes issuable upon exchange of the 2008 Notes and the Security
Guarantees (as defined in the Indenture), the “Securities”) in an amount equal to $50.00 divided by the greater of (x) the 95% of the Volume Weighted Average Price of the Common Stock, as determined using Bloomberg function
VWAP for the 10 consecutive trading days ending two days before the Closing Date (as hereinafter defined), beginning at 9:30 a.m. (New York time) on the first day of the period and ending at 4:30 p.m. (New York time) on the last day of the period,
or (y) 95% of the closing price of the Common Stock on the day before the Closing Date, rounded up to the nearest whole share, and (ii) 2010 Notes in a principal amount of $900.00, rounded up to the nearest $1,000.00 principal amount. 

 1.2 Closing; Closing Date. The completion of the exchange of the 2008 Notes (the
“Closing”) shall be held at 9:00 a.m. (Central Time) as soon as practicable following the satisfaction of the conditions set forth in Section 4 (the “Closing Date”), at the offices of Doherty & Doherty
LLP, 1717 St. James Place, Suite 520, Houston, Texas 77056 or at such other time and place as the Company and Investors may agree. 
 1.3 Delivery of the 2008 Notes. At the Closing, subject to the terms and conditions hereof, each Investor will deliver to the Company the 2008 Notes being exchanged by such Investor by 

(i) in respect of a Definitive Security (as defined in the 2008 Supplement), an Investor must complete and manually
sign the Assignment Form on the back of the Definitive Security, obtain the signature guarantee required thereby and deliver Definitive Security, together with the Assignment Form, to the Company; 
 (ii) in respect of a beneficial interest in a Global Security (as defined in the 2008 Supplement), an Investor who is a
Beneficial Owner (as defined in the 2008 Supplement) must comply with DTC’s procedures for assigning a beneficial interest in a Global Security. 
 1.4 Delivery of the 2010 Notes and the Shares. At the Closing, subject to the terms and conditions hereof, the Company, and the Guarantors with respect to the 2010 Notes, will (i) deliver to
each Investor the principal amount of 2010 Notes determined in accordance with Section 1.1 in the form set forth in the 2010 Supplement and subject to the legend set forth in Section 3.3, (ii) cause a book entry to be made in the
records of the Company’s transfer agent in the name of each Investor evidencing (a “Book Entry”) the number of Exchange Shares determined in accordance with Section 1.1 and subject to the notation or legend set forth in
Section 3.3, and (iii) pay to each Investor an amount in cash equal to the accrued and unpaid interest on the exchanged 2008 Notes surrendered by such Investor up to (but not including) the Closing Date. 
 2. Representations and Warranties of the Company and the Guarantors. The Company and the Guarantors hereby jointly and severally represents and
warrants to each Investor: 
 2.1 Authorization. 
 (a) All corporate action on the part of the Company and each Guarantor, its officers, directors and shareholders necessary for the
authorization, execution and delivery of this Agreement has been taken. The Company and each Guarantor has the requisite corporate power to enter into this Agreement and carry out and perform its obligations under the terms of this Agreement. At the
Closing, the Company will have the requisite corporate power to issue and deliver the 2010 Notes, the Exchange Shares and the Common Stock issuable upon conversion of the 2010 Notes (the “Conversion Shares”). At the Closing, each
Guarantor will have the requisite corporate power to provide its guarantee to the 2010 Notes. This Agreement has been duly authorized, executed and delivered by the Company and each Guarantor and, upon due execution and delivery by the Investors,
this Agreement will be a valid and binding agreement of the Company and each Guarantor, enforceable against the Company and each Guarantor in accordance with its terms (except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable principles). 
 (b)
The Indenture has been duly authorized by the Company and each Guarantor and, assuming due authorization, execution and delivery thereof by the Trustee named therein, when executed and delivered by the Company and each Guarantor, will constitute
a valid and binding instrument enforceable against the Company and each Guarantor in accordance with its terms (except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’
rights generally or by equitable principles). 
  

 Page 2 

 (c) The 2010 Notes have been duly authorized by the Company and each Guarantor, and,
when executed and authenticated in accordance with the provisions of the Indenture and delivered to the Investors in exchange for the 2008 Notes, will have been duly executed and delivered by the Company and each Guarantor and will constitute the
valid and binding obligations of the Company and each Guarantor (subject, as to the enforcement of remedies, to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable
principles) entitled to the benefits of the Indenture and will be convertible into the Conversion Shares in accordance with their terms. The Security Guarantees (as defined in the Indenture) have been duly authorized by each Guarantor and, when
executed and delivered by each Guarantor, will constitute a valid and binding instrument enforceable against each Guarantor in accordance with their terms (except as rights to indemnification thereunder may be limited by applicable law and except as
enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable principles). 
 (d) Each Security Document (as defined in the 2010 Supplement, together with this Agreement, Indenture and the Registration Rights
Agreement, the “Transaction Documents”) has been duly authorized by the Company and each Guarantor that is a party thereto and, assuming due authorization, execution and delivery thereof by the other parties thereto, when executed
and delivered by the Company and the applicable Guarantors, will constitute a valid and binding instrument enforceable against the Company and the applicable Guarantors in accordance with their terms (except as rights to indemnification thereunder
may be limited by applicable law and except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable principles). 
 (e) The Registration Rights Agreement has been duly authorized and, when executed and delivered by the Company, assuming due
authorization, execution and delivery thereof by the Investors, will constitute a valid and binding instrument enforceable against the Company in accordance with its terms (except as rights to indemnification thereunder may be limited by applicable
law and except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable principles). 
 2.2 No Conflict with Other Instruments. The execution, delivery and performance of the Transaction Documents, the issuance and
delivery of the Securities, the issuance of the Conversion Shares upon the conversion of the 2010 Notes and the consummation of the actions contemplated by the Transaction Documents (which for all purposes herein shall include conversion of the 2010
Notes) will not (A) result in any violation of, be in conflict with, or constitute a default under, with or without the passage of time or the giving of notice: (i) any provision of the Company’s, or any of its subsidiary’s or
any Guarantor’s Certificate or Articles of Incorporation or Bylaws as in effect on the date hereof or at the Closing; (ii) any provision of any judgment, arbitration ruling, decree or order to which the Company, any subsidiary or any
Guarantor is a party or by which any of them is bound; (iii) any bond, debenture, note or other evidence of indebtedness, or any lease, contract, mortgage, indenture, deed of trust, loan agreement, joint venture or other agreement, instrument
or commitment to which the Company, any subsidiary or any Guarantor is a party or by which they or their respective properties are bound; or (iv) any statute, rule, law or governmental regulation applicable to the Company, any subsidiary or any
Guarantor; or (B) result in the creation or imposition of any lien, encumbrance, claim, security interest or restriction whatsoever upon any of the properties or assets of the Company, any subsidiary or any Guarantor or any acceleration of
indebtedness pursuant to any obligation, agreement or condition contained in any bond, debenture, note or any other evidence of indebtedness or any indenture, mortgage, deed of trust or any other agreement or instrument to which the Company, any
subsidiary or any Guarantor is a party or by which any of them is bound or to which any of the property or assets of the Company, any subsidiary or any Guarantor is

  

 Page 3 

 
subject. No consent, approval, authorization or other order of, or registration, qualification or filing with, any regulatory body, administrative agency, or other governmental body is required
for the execution and delivery of the Transaction Documents by the Company or any Guarantor and the valid issuance of the Securities by the Company and the Guarantors pursuant to this Agreement and the Indenture, other than such as have been made or
obtained and that remain in full force and effect, and except for the filing of a Form D under the Securities Act or any notice filings required to be made under state securities laws. 
 2.3 Certificate of Incorporation; Bylaws. The Amended and Restated Certificate of Incorporation of the Company filed with the SEC (as
hereinafter defined) as Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the period ending September 30, 2009 is a true, correct and complete copy of the Company’s Amended and Restated Certificate of Incorporation as in
effect on the date hereof. The Bylaws of the Company attached as Appendix F to the Company’s Definitive Proxy Statement filed with the SEC on September 27, 2001 is a true, correct and complete copy of the Company’s Bylaws as in effect
on the date hereof. 
 2.4 Organization, Good Standing and Qualification. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business as now conducted. The Company, each of its subsidiaries, and each Guarantor has the full power
and authority to own, operate and occupy its properties and to conduct its business as presently conducted and is duly qualified to transact business and is in good standing in each jurisdiction in which the failure so to qualify would have a
material adverse effect on its or its subsidiaries’ business, financial condition, properties, operations, prospects or assets or its ability to perform its obligations under this Agreement (a “Material Adverse Effect”).

 2.5 SEC Filings. The consolidated financial statements contained in each report, registration statement and definitive
proxy statement filed by the Company with the Securities and Exchange Commission (the “SEC,” and the documents, the “Company SEC Documents”): (i) complied as to form in all material respects with the published
rules and regulations of the SEC applicable thereto and were timely filed; (ii) the information contained therein as of the respective dates thereof did not contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein in light of the circumstances under which they were made not misleading; (iii) were prepared in accordance with generally accepted accounting principles applied on a
consistent basis throughout the periods covered, except as may be indicated in the notes to such financial statements and (in the case of unaudited statements) as permitted by Form 10-Q of the SEC, and except that unaudited financial statements may
not contain footnotes and are subject to year-end audit adjustments; and (iv) fairly present the consolidated financial position of the Company and its subsidiaries as of the respective dates thereof and the consolidated results of operations
cash flows and the changes in shareholders’ equity of the Company and its subsidiaries for the periods covered thereby. 
 2.6 Capitalization. The authorized capital stock of the Company consists of (i) 80,000,000 shares of Common Stock, of which (A) 25,056,627 shares were issued and outstanding as of the date of this Agreement, and
(B) 12,397,137 shares were reserved for issuance upon the exercise or conversion, as the case may be, of outstanding options, warrants or other convertible securities as of the date of this Agreement; and (ii) 100,000 shares of preferred
stock, of which 16,000 shares have been designated as Series A Cumulative Convertible Preferred Stock (the “Series A Preferred Stock”), of which 13,220 shares of Series A Preferred Stock were issued and outstanding as of the date of
this Agreement, and no shares were reserved for issuance upon the exercise or conversion, as the case may be, of outstanding options, warrants or other convertible securities. All issued and outstanding shares of Common Stock and Series A Preferred
Stock have been duly authorized and validly issued, are fully paid and nonassessable, have been issued and sold in compliance with the registration requirements (including any exceptions therefrom) of federal and state securities laws or the
applicable statutes of limitation have expired, and were not issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. Except as set forth herein or the Company SEC Documents, there are no
(i) outstanding rights

  

 Page 4 

 
(including, without limitation, preemptive rights), warrants or options to acquire, or instruments convertible into or exchangeable for, any unissued shares of capital stock or other equity
interest in the Company, or any contract, commitment, agreement, understanding or arrangement of any kind to which the Company or any subsidiary is a party and relating to the issuance or sale of any capital stock or convertible or exchangeable
security of the Company or any subsidiary, other than 1,594,379 options granted to directors and employees of the Company pursuant to its 2003 Long Term Incentive Plan, 2005 Long Term Incentive Plan or 2007 Long Term Incentive Plan; or
(ii) obligations of the Company to purchase redeem or otherwise acquire any of its outstanding capital stock or any interest therein or to pay any dividend or make any other distribution in respect thereof. Except as disclosed in the Company
SEC Documents, there are no anti-dilution or price adjustment provisions, co-sale rights, registration rights, rights of first refusal or other similar rights contained in the terms governing any outstanding security of the Company that will be
triggered by the issuance of the Securities or the Conversion Shares. 
 2.7 2008 Notes. The Conversion Rate (as defined
in the 2008 Supplement) for the 2008 Notes is 43.9560 shares of Common Stock per $1,000 principal amount of 2008 Notes. Since the initial issuance of the 2008 Notes, there has been (i) no transaction that would cause an adjustment to the
Conversion Rate pursuant to Section 9.02 of the 2008 Supplement, and (ii) no Reorganization Event (as defined in the 2008 Supplement). 
 2.8 Subsidiaries. Except as set forth in the Company SEC Documents or such additional entities that are guarantors of the 2010 Notes, the Company does not presently own or control, directly or
indirectly, and has no stock or other interest as owner or principal in, any other corporation or partnership, joint venture, association or other business venture or entity (each a “subsidiary”). Each subsidiary is duly
incorporated or organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization and has all requisite power and authority to carry on its business as now conducted. All of the outstanding capital
stock or other securities of each subsidiary is owned by the Company, directly or indirectly, free and clear of any liens, claims, or encumbrances other than pledges of such shares as security under or in connection with the Amended Credit Agreement
and the 2010 Notes. 
 2.9 Valid Issuance of Securities. The Securities and the Conversion Shares are duly authorized
and, when issued and delivered in accordance with the terms hereof or of the 2010 Notes, as the case may be, will be duly and validly authorized and issued, fully paid and nonassessable, free from all taxes, liens, claims, encumbrances and charges
with respect to the issue thereof; provided, however, that the Securities and the Conversion Shares may be subject to restrictions on transfer under state and/or federal securities laws or as otherwise set forth herein. The issuance and
delivery of the Securities and the Conversion Shares in accordance with the terms hereof or the 2010 Notes will not be subject to preemptive rights of stockholders of the Company. The Conversion Shares have been duly reserved for issuance upon
conversion of the 2010 Notes. 
 2.10 Offering. Assuming the accuracy of the representations of the Investors in
Section 3.3 of this Agreement on the date hereof, on the Closing Date and solely as this Section 2.10 relates to the issue of the Conversion Shares on the date(s) of conversion of the 2010 Notes, the offer and issuance of the Securities to
Investors hereunder and issuance of the Conversion Shares upon the conversion of the 2010 Notes in accordance with the terms thereof (assuming no change in applicable law prior to the date the Conversion Shares are issued), are and will be exempt
from the registration and prospectus delivery requirements of the Securities Act and have been or will be registered or qualified (or are or will be exempt from registration and qualification) under the registration, permit or qualification
requirements of all applicable state securities laws. Neither the Company, nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales of any security or solicited any offers to buy
any security under circumstances that would require registration under the Securities Act of the issuance of the Securities to the Investors or the issuance of the Conversion Shares upon conversion of the 2010 Notes. Other than the Company SEC
Documents, the Company has not distributed and will not distribute prior to the Closing Date any offering material in connection with the issuance of the Securities

  

 Page 5 

 
or Conversion Shares. The Company has not taken any action to sell, offer for sale or solicit offers to buy any securities of the Company that would bring the exchange of the 2008 Notes or the
issuance of the Securities or the issuance of the Conversion Shares upon conversion of the 2010 Notes, within the provisions of Section 5 of the Securities Act, unless such offer, issuance or sale was or shall be within the exemptions of
Section 4 of the Securities Act. 
 2.11 Litigation. Except as set forth in the Company SEC Documents, there is no
action, suit, proceeding nor investigation pending or, to the Company’s knowledge, currently threatened against the Company or any of its subsidiaries that (a) would reasonably be expected to adversely effect the business, condition,
prospects, capitalization, assets, liabilities, operations or financial performance of the Company or its subsidiaries or (b) would be required to be disclosed in the Company’s Annual Report on Form 10-K under the requirements of
Item 103 of Regulation S-K. The foregoing includes, without limitation, any action, suit, proceeding or investigation, pending or threatened, that questions the validity of the Transaction Documents or the right of the Company to enter into the
Transaction Documents and perform its obligations hereunder and thereunder. Neither the Company nor any subsidiary nor any Guarantor is subject to any injunction, judgment, decree or order of any court, regulatory body, arbitral panel,
administrative agency or other government body that could reasonably be expected to have a Material Adverse Effect. 
 2.12
Governmental Consents. No consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any federal, state, local or provincial governmental authority on the part of the Company or any
Guarantor is required in connection with the consummation of the transactions contemplated by the Transaction Documents, except for notices required or permitted to be filed with certain state and federal securities commissions, which notices will
be filed on a timely basis. 
 2.13 No Brokers. Except for any fees payable by the Company to Fig Partners, LLC, no
broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by the Transaction Documents based on arrangements made by the Company or any Guarantor.

 2.14 Compliance. The Company is not in violation of its Amended and Restated Certificate of Incorporation or Bylaws.
Neither the Company nor any subsidiary nor any Guarantor has been advised or has reason to believe, that it is not conducting its business in compliance with all applicable laws, rules and regulations of the jurisdictions in which it is conducting
business, including, without limitation, all applicable local, state and federal environmental laws and regulations; except where failure to be so in compliance would not have a Material Adverse Effect. Each of the Company, the subsidiaries and the
Guarantors has all necessary franchises, licenses, certificates and other authorizations from any foreign, federal, state or local government or governmental agency, department or body that are currently necessary for the operation of the business
of the Company, the subsidiaries and the Guarantors as currently conducted, except where the failure to currently possess such franchises, licenses, certificates and other authorizations would not reasonably be expected to have a Material Adverse
Effect. 
 2.15 Exchange Act Compliance. The Common Stock is registered pursuant to Section 12(b) of the Securities
Exchange Act of 1934 (the “Exchange Act”) and is listed on the New York Stock Exchange (the “Principal Market”), and, except as disclosed in the Company SEC Documents, the Company has taken no action designed to, or
likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act or delisting the Common Stock (including the Exchange Shares and the Conversion Shares) from the Principal Market. Except as disclosed in the
Company SEC Documents, the Company is in compliance with all of the presently applicable requirements for continued listing of the Common Stock on the Principal Market. The issuance of the Securities and the Conversion Shares does not require
stockholder approval including, without limitation, pursuant to the rules and regulations of the Principal Market. 
  

 Page 6 

 2.16 Form S-3 Eligibility; Registration Rights Agreements. The Company is eligible to
register the Securities and the Conversion Shares for resale under the Securities Act by the Investors using a Registration Statement on Form S-3. Other than as set forth in the Company SEC Documents or as provided under the Registration Rights
Agreement and the Registration Right Agreement related to the Amended Credit Agreement, the Borrower has not agreed to register any of its authorized or outstanding securities under the Securities Act. 
 2.17 Transfer Taxes. On the Closing Date, all stock transfer or other taxes (other than income taxes) that are required to be paid in
connection with the issuance of the Securities hereunder will be, or will have been, fully paid or provided for by the Company and the Company will have complied with all laws imposing such taxes. 
 2.18 No General Solicitation. Neither the Company, nor any of its affiliates, nor any Guarantor, nor any person acting on its or
their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D promulgated under the Securities Act) in connection with the issuance of the Securities. 
 2.19 Application of Takeover Protections; Rights Agreement. The Company and its board of directors have taken all necessary action,
if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Certificate of Incorporation or the
laws of the jurisdiction of its formation which is or could become applicable to any Investor as a result of the transactions contemplated by the Transaction Documents, including, without limitation, the Company’s issuance of the Securities and
the Conversion Shares and any Investor’s ownership of the Securities and the Conversion Shares. The Company has not adopted a shareholder rights plan or similar arrangement relating to accumulations of beneficial ownership of Common Stock or a
change in control of the Company. 
 2.20 Security Documents Complete. The Security Documents represent all of the
collateral and guarantee agreements, security agreements, mortgages and other similar agreements necessary to grant to Investors a valid security interest in the Collateral (as defined in the 2010 Supplement), which security interest will rank
immediately junior in priority (subject to Permitted Collateral Liens (as defined in the 2010 Supplement)) to the security interests in the Collateral securing the Priority Lien Obligations (as defined in the 2010 Supplement). 
 2.21 Security Interests. 
 (a) Upon execution and delivery of the Security Documents and the filing of Uniform Commercial Code financing statements and any other applicable registrations in the appropriate filing offices,
the Investors will obtain a valid and perfected lien upon and security interest in all right, title and interest of the Company and the Guarantors in the Collateral (to the extent a lien upon or security interest in such Collateral may be perfected
by possession, by filings under the Uniform Commercial Code as in effect in any applicable jurisdiction or by any filings required with the United States Patent and Trademark Office or United States Copyright Office) as security for the 2010 Notes
and the Securities Guarantee (as defined in the Indenture), which security interest will rank immediately junior in priority (subject to Permitted Collateral Liens) to the security interests in the Collateral securing the Priority Lien Obligations.

 (b) Upon the execution and delivery of the mortgages to be delivered at Closing (the “Mortgages”)
related to the Mortgaged Property (as used in the Amended Credit Agreement), such Mortgages will be effective to grant a legal and valid mortgage lien on all of the mortgagor’s right, title and interest in each of the Mortgaged Properties
thereunder. When the Mortgages are duly recorded in the proper recorders’ offices or appropriate public records and the mortgage recording fees and taxes in respect thereof are paid and compliance is otherwise had with the formal requirements
of state or local

  

 Page 7 

 
law applicable to the recording of real estate mortgages generally, each such Mortgage shall constitute a validly perfected and enforceable second-priority security interest in the related
Mortgaged Property, for the ratable benefit of the holders of the 2010 Notes, subject only to Permitted Collateral Liens and other encumbrances and exceptions to title expressly set forth therein and except to the extent that such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or by equitable principles. 
 3. Representations and Warranties of the Investors. Each Investor, severally and not jointly, hereby represents and warrants to the Company as follows: 
 3.1 Legal Power. The Investor has the requisite authority to enter into this Agreement and to carry out and perform its obligations
under the terms of this Agreement. All action on the Investor’s part required for the lawful execution and delivery of this Agreement have been or will be effectively taken prior to the Closing. 
 3.2 Due Execution. This Agreement has been duly authorized, executed and delivered by the Investor, and, upon due execution and
delivery by the Company, this Agreement will be a valid and binding agreement of the Investor, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally
or by equitable principles. 
 3.3 Investment Representations. In connection with the issuance of the Securities and
Conversion Shares, the Investor, for itself and no other Investor, makes the following representations: 
 (a) Investment for
Own Account. The Investor is acquiring the Securities and any Conversion Shares for its own account, not as nominee or agent, and not with a view to, or for resale in connection with, any distribution or public offering thereof within the
meaning of the Securities Act; provided, however, that by making the representations herein, the Investor does not agree to hold any of the Securities or the Conversion Shares for any minimum or specific term and reserves the right to dispose
of the securities at any time in accordance with, or pursuant to, a registration statement or an exemption from the registration requirements of the Securities Act. 
 (b) Transfer Restrictions; Legends. The Investor understands that (i) the Securities and Conversion Shares have not been registered under the Securities Act; (ii) the Securities and
Conversion Shares are being issued pursuant to an exemption from registration, based in part upon the Company’s reliance upon the statements and representations made by the Investors in this Agreement, and that the Securities and Conversion
Shares must be held by the Investor indefinitely, and that the Investor must, therefore, bear the economic risk of such investment indefinitely, unless a subsequent disposition thereof is registered under the Securities Act or is exempt from such
registration; (iii) each note representing the 2010 Notes and each certificate representing Exchange Shares or Conversion Shares will be endorsed with the following legend, and each Book Entry evidencing Exchange Shares or Conversion Shares
shall contain the following notation, until the earlier of (1) the time at which the Securities or the Conversion Shares, as applicable, have been sold under a Registration Statement, or (2) the date on which the Securities or the
Conversion Shares, as applicable, may be immediately sold without registration and without restriction (including without limitation as to sales volume by each holder thereof) as to the number of Securities or Conversion Shares, as applicable, to be
sold, pursuant to Rule 144 under the Securities Act or otherwise: 
 THIS SECURITY HAS NOT BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION

  

 Page 8 

 
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH
EFFECT, THE FORM AND SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE ISSUER, THE REGISTRAR AND THE TRANSFER AGENT. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED BROKER-DEALER OR OTHER LOAN
WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a) UNDER THE SECURITIES ACT. 
 (iv) the Company
will instruct any transfer agent not to register any transfer of the Securities or the Conversion Shares (or any portion thereof) until the applicable time set forth in clause (iii) above unless the conditions specified in the foregoing legends
are satisfied or, if the opinion of counsel referred to above is to the further effect that such legend is not required in order to establish compliance with any provisions of the Securities Act or this Agreement, or other satisfactory assurances of
such nature are given to the Company. 
 The Company acknowledges and agrees that an Investor may from time to time pledge,
and/or grant a security interest in some or all of the Securities or the Conversion Shares pursuant to a bona fide margin agreement in connection with a bona fide margin account with a financial institution that is an “accredited
investor,” as defined in Rule 501(a) under the Securities Act, and, if required under the terms of such agreement or account, the Investor may transfer pledged or secured Securities or Conversion Shares to the pledgees or secured parties. Such
a pledge or transfer shall not be subject to approval or consent of the Company and no legal opinion of legal counsel to the pledgee, secured party or pledgor shall be required in connection with the pledge, but such legal opinion may be required in
connection with a subsequent transfer following default by the Investor transferee of the pledge. No notice shall be required of such pledge. At the applicable Investor’s expense, the Company will execute and deliver such reasonable
documentation as a pledgee or secured party of Securities or Conversion Shares may reasonably request in connection with a pledge or transfer of the Securities or Conversion Shares including the preparation and filing of any required prospectus
supplement under Rule 424(b)(3) of the Securities Act or other applicable provision of the Securities Act to appropriately amend the list of Selling Stockholders thereunder. 
 Book Entries evidencing, and certificates representing, Exchange Shares or Conversion Shares shall not contain any notation or legend, as
applicable, (including the notation and legend set forth in this Section): (i) following a sale of such Exchange Shares or Conversion Shares pursuant to an effective registration statement; (ii) following a sale of such Exchange Shares or
Conversion Shares pursuant to Rule 144, or (iii) while such Exchange Shares or Conversion Shares are eligible for sale under Rule 144 without volume or manner of sale limitations, or (iv) if such legend is not required under applicable
requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the SEC). Following such time as restrictive notations are not required to be made relative to any Book Entry evidencing, or legends are
not required to be placed on certificates representing, Exchange Shares or Conversion Shares, the Company will (A) promptly upon a request by an Investor, instruct the transfer agent for the Company to remove the restrictive notation from Book
Entries evidencing such Exchange Shares or Conversion Shares; and (B) no later than three Trading Days following the delivery by an Investor to the Company or the Company’s transfer agent of a certificate representing Exchange Shares or
Conversion Shares containing a restrictive legend, deliver or cause to be delivered to such Investor a certificate representing such Exchange Shares or Conversion Shares that is free from all restrictive and other legends. 
 The Company shall cause its counsel to issue a legal opinion to the Company’s transfer agent promptly after the effective date of a
registration statement covering the Exchange Shares or Conversion

  

 Page 9 

 
Shares if required by the Company’s transfer agent to effect the removal of any notation on the Book Entries evidencing, or legend on the certificates representing, such Exchange Shares or
Conversion Shares. The Company may not make any notation on its records or give instructions to any transfer agent of the Company that enlarge the restrictions on transfer set forth in this Section. Certificates for Exchange Shares or Conversion
Shares subject to legend removal hereunder shall be transmitted by the transfer agent of the Company to the Investors by crediting the account of the Investor’s prime broker with the Depository Trust Company system. 
 Each Investor, severally and not jointly with the other Investors, agrees that the removal of the restrictive notation on the Book Entries
evidencing, or legend from certificates representing, Exchange Shares or Conversion Shares, as set forth in this Section 3.2(b), is predicated upon the Company’s reliance that the Investor will sell any Exchange Shares or Conversion Shares
pursuant to either the registration requirements of the Securities Act, including any applicable prospectus delivery requirements, or an exemption therefrom. 
 (c) Financial Sophistication. The Investor has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in connection
with the transactions contemplated in this Agreement. 
 (d) Accredited Investor Status. The Investor is an
“accredited investor” as such term is defined in Rule 501(a) under the Securities Act. 
 (e) Residency. The
Investor is organized under the laws of the state set forth beneath such Investor’s name on the signature page attached hereto, and its principal place of operations is in the state set forth beneath such Investor’s name on the signature
page attached hereto. 
 3.4 No Investment, Tax or Legal Advice. Each Investor understands that nothing in the Company
SEC Documents, this Agreement, or any other materials presented to the Investor in connection with the issuance of the Securities constitutes legal, tax or investment advice. Each Investor has consulted such legal, tax and investment advisors as it,
in its sole discretion, has deemed necessary or appropriate in connection with its purchase of Securities. 
 3.5 Additional
Acknowledgement. Each Investor acknowledges that it has independently evaluated the merits of the transactions contemplated by this Agreement, that it has independently determined to enter into the transactions contemplated hereby, that it is
not relying on any advice from or evaluation by any other person. Each Investor acknowledges that it has not taken any actions that would deem the Investors to be members of a “group” for purposes of Section 13(d) of the Exchange Act.

 4. Conditions to Closing. 
 4.1 Conditions to Obligations of Investors at Closing. Each Investor’s obligation to exchange 2008 Notes for the Securities at the Closing is subject to the fulfillment to that Investor’s
reasonable satisfaction, on or prior to the Closing, of all of the following conditions, any of which may be waived by such Investor: 
 (a) Representations and Warranties True; Performance of Obligations. The representations and warranties made by the Company in Section 2 shall be true and correct in all material respects on the Closing Date with the same force
and effect as if they had been made on and as of the Closing Date and the Company shall have performed and complied with all obligations and conditions herein required to be performed or complied with by it on or prior to the Closing in all material
respects and a certificate duly executed by an officer of the Company, to the effect of the foregoing, shall be delivered to the Investors. 
 (b) Proceedings and Documents. All corporate and other proceedings in connection with the transactions contemplated at the Closing and all documents and instruments incident to such transactions
shall be reasonably satisfactory in substance and form to counsel to the Investor, and

  

 Page 10 

 
counsel to the Investor shall have received all such counterpart originals or certified or other copies of such documents as they may reasonably request. The Company shall have delivered (or
caused to have been delivered) to each Investor, the certificates required by this Agreement. The Conversion Shares shall have been duly authorized and reserved for issuance upon conversion of the 2010 Notes. 
 (c) Qualifications, Legal Investment. All authorizations, approvals, or permits, if any, of any governmental authority or regulatory
body of the United States or of any state that are required in connection with the lawful exchange of the 2008 Notes and issuance of the Securities and Conversion Shares shall have been duly obtained and shall be effective on and as of the Closing.
No stop order or other order enjoining the exchange of the 2008 Notes or the issuance of the Securities or Conversion Shares shall have been issued and no proceedings for such purpose shall be pending or, to the knowledge of the Company, threatened
by the SEC, or any commissioner of corporations or similar officer of any state having jurisdiction over this transaction. At the time of the Closing, the exchange of the 2008 Notes and the issuance of the Securities and Conversion Shares shall be
legally permitted by all laws and regulations to which Investors and the Company are subject. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in
any court or governmental authority of competent jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby that prohibits the consummation of any of the transactions contemplated by the Transaction
Documents. 
 (d) Execution of Agreements. The Company shall have executed this Agreement and the Registration Rights
Agreement and have delivered such agreements to the Investors. 
 (e) Secretary’s Certificate. The Company shall
have delivered to the Investors a certificate of the Secretary of the Company certifying as to the truth and accuracy of the resolutions of the board of directors relating to the transaction contemplated hereby (a copy of which shall be included
with such certificate). 
 (f) Trading and Listing. Trading and listing of the Company’s common stock on the
Principal Market shall not have been suspended by the SEC or the Principal Market. 
 (g) Market Listing. The Company
will comply with all of the requirements of the Financial Industry Regulatory Authority, Inc. and the Principal Market with respect to the issuance of the Securities and the Conversion Shares and shall have, or will, list the Exchange Shares and the
Conversion Shares on the Principal Market prior to, or on, the date of issuance thereof. 
 (h) Blue Sky. The Company
shall have obtained all necessary “blue sky” law permits and qualifications, or have the availability of exemptions therefrom, required by any state for the exchange of the 2008 Notes and the issuance of the Securities and issuance of the
Conversion Shares upon the conversion of the 2010 Notes. 
 (i) Material Adverse Change. Since the date of this
Agreement, there shall not have occurred any event which results in a Material Adverse Effect. 
 (j) Change in Conversion
Rate. Since the date of this Agreement, there shall not have occurred any event that would cause an adjustment to the Conversions Rate (as defined in the 2008 Supplement) pursuant to Section 9.02 of the 2008 Supplement, and (ii) no
Reorganization Event (as defined in the 2008 Supplement). 
 (k) Opinion. The Company shall have delivered to Investors
the opinion of Andrews Kurth, LLP, counsel to the Company, dated as of the Closing Date in substantially the form attached hereto as Exhibit D. 
 4.2 Conditions to Obligations of the Company. The Company’s obligation to exchange the 2008 Notes and issue the Securities at the Closing is subject to the fulfillment to the Company’s
reasonable satisfaction, on or prior to the Closing of the following conditions, any of which may be waived by the Company: 
 (a) Representations and Warranties True. The representations and warranties made by the Investors in Section 3 shall be true and correct in all material respects on the Closing Date with the same force and effect as if they had
been made on and as of said date. 
  

 Page 11 

 (b) Performance of Obligations. The Investors shall have performed and complied with
all agreements and conditions herein required to be performed or complied with by them on or before the Closing in all material respects. 
 (c) Qualifications, Legal Investment. All authorizations, approvals, or permits, if any, of any governmental authority or regulatory body of the United States or of any state that are required in
connection with the lawful exchange of the 2008 Notes and issuance of the Securities and Conversion Shares shall have been duly obtained and shall be effective on and as of the Closing. No stop order or other order enjoining the conversion of the
Notes or the issuance of the Securities or Conversion Shares shall have been issued and no proceedings for such purpose shall be pending or, to the knowledge of the Company, threatened by the SEC, or any commissioner of corporations or similar
officer of any state having jurisdiction over this transaction. At the time of the Closing, conversion of the Notes and issuance of the Securities and the Conversion Shares shall be legally permitted by all laws and regulations to which the
Investors and the Company are subject. No litigation, statute, rule, regulation, executive order, decree, ruling or injunction shall have been enacted, entered, promulgated or endorsed by or in any court or governmental authority of competent
jurisdiction or any self-regulatory organization having authority over the matters contemplated hereby which prohibits the consummation of any of the transactions contemplated by the Transaction Documents. 
 (d) Execution of Agreements. The Investors shall have executed this Agreement and the Registration Rights Agreement and delivered
this Agreement and the Registration Rights Agreement to the Company. 
 5. Additional Covenants. 
 5.1 Reporting Status. With a view to making available to the Investors the benefits of certain rules and regulations of the SEC which
may permit the sale of the Securities and Conversion Shares to the public without registration, the Company agrees to use its best efforts to file with the SEC, in a timely manner all reports and other documents required of the Company under the
Exchange Act. The Company will otherwise take such further action as an Investor may reasonably request, all to the extent required from time to time to enable such Investor to sell the Securities and Conversion Shares without registration under the
Securities Act or any successor rule or regulation adopted by the SEC. 
 5.2 Listing. So long as an Investor owns any of
the Securities or Conversion Shares, the Company will use its reasonable best efforts to maintain the automated quotation of its Common Stock, including the Exchange Shares and Conversion Shares, on the Principal Market or an alternative listing on
the NASDAQ Stock Market or, if such quotation on the Principal Market or the NASDAQ Stock Market is not possible, qualification for trading on the OTCBB, and will comply in all material respects with the Company’s reporting, filing and other
obligations under the bylaws or rules of the Financial Industry Regulatory Authority, Inc. and such exchange or listing, if applicable. 
 5.3 Non-Public Information. The Company covenants and agrees that neither it nor any other person acting on its behalf will provide any Investor or its agents or counsel with any information that
the Company believes constitutes material non-public information, unless prior thereto such Investor shall have executed a written agreement regarding the confidentiality and use of such information. The Company understands and confirms that each
Investor shall be relying on the foregoing representations in effecting transactions in securities of the Company. 
  

 Page 12 

 6. Additional Securities Law Matters. 
 6.1 Limits on Additional Issuances. The Company will not, for a period of six months following the Closing Date, offer for sale or
sell any securities unless, in the opinion of the Company’s counsel, such offer or sale does not jeopardize the availability of exemptions from the registration and qualification requirements under applicable securities laws with respect to the
securities being offered hereby. Except for the issuance of common stock under the Amended Credit Agreement, stock options under the Company’s stock option plans, the issuance of common stock upon exercise of outstanding options,
warrants and convertible securities, the issuance of common stock purchase warrants, and the offering contemplated hereby, the Company has not engaged in any offering of equity securities during the six months prior to the date of this Agreement.
The foregoing provisions shall not prevent the Company from filing a “shelf” registration statement pursuant to Rule 415 under the Securities Act, but the foregoing provisions shall apply to any sale of securities thereunder. 

6.2 Form D and State Securities Filings. If applicable, the Company will file with the SEC a Notice of Sale of Securities on
Form D with respect to the Securities, as required under Regulation D under the Securities Act, no later than 15 days after the Closing Date. The Company will promptly and timely file all documents and pay all filing fees required by any
states’ securities laws in connection with the issuance of Securities. 
 6.3 Supplying Information. For so long as
the Securities remain outstanding and are “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act, the Company will furnish to holders of the Securities and prospective purchasers of the Securities designated
by such holders, upon the request of such holders or such prospective purchasers, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act, unless the Company is then subject to and in compliance with
Section 13 or 15(d) of the Exchange Act. 
 7. Miscellaneous. 
 7.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without
regard to the choice of law provisions thereof, and the federal laws of the United States. 
 7.2 Successors and Assigns.
Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs, executors, and administrators of the parties hereto. 
 7.3 Entire Agreement. The Transaction Documents and the exhibits thereto, and the other documents delivered pursuant thereto,
constitute the full and entire understanding and agreement among the parties with regard to the subjects hereof and no party shall be liable or bound to any other party in any manner by any representations, warranties, covenants, or agreements
except as specifically set forth therein. Nothing in this Agreement, express or implied, is intended to confer upon any party, other than the parties thereto and their respective successors and assigns, any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided therein. 
 7.4 Severability. In the event
any provision of this Agreement shall be invalid, illegal, or unenforceable, it shall to the extent practicable, be modified so as to make it valid, legal and enforceable and to retain as nearly as practicable the intent of the parties, and the
validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 
 7.5 Amendment and Waiver. Except as otherwise provided herein, any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance, either
retroactively or prospectively, and either for a specified period of time or indefinitely), with the written consent of the Company and Investors representing a majority of the Securities (determined as if the 2010 Notes had been converted to Common
Stock) and the

  

 Page 13 

 
Conversion Shares. Any amendment or waiver effected in accordance with this Section 7.5 shall be binding upon any holder of any Securities purchased under this Agreement (including
securities into which such Securities have been converted), each future holder of all such securities, and the Company. 
 7.6 Fees and Expenses. The Company agrees to pay on demand (i) all reasonable out-of-pocket costs and expenses of each Investor (including outside counsel fees and expenses of each Investor) in connection with the preparation,
execution and delivery and of this Agreement and the related documents, and (ii) all costs and expenses, if any, of each Investor (including outside counsel fees and expenses of each Investor) in connection with the enforcement (whether through
negotiations, legal proceedings, or otherwise) of this Agreement and the related documents. 
 7.7 Notices. All notices,
requests, consents and other communications hereunder shall be in writing, shall be delivered (A) if within the United States, by first-class registered or certified airmail, or nationally recognized overnight express courier, postage prepaid,
or by facsimile, or (B) if from outside the United States, by International Federal Express (or comparable service) or facsimile, and shall be deemed given (i) if delivered by first-class registered or certified mail domestic, upon the
business day received, (ii) if delivered by nationally recognized overnight carrier, one business day after timely delivery to such carrier, (iii) if delivered by International Federal Express (or comparable service), two business days
after so mailed, (iv) if delivered by facsimile, upon electric confirmation of receipt and shall be addressed as follows, or to such other address or addresses as may have been furnished in writing by a party to another party pursuant to this
paragraph: 
 if to the Company, to: 
  

			
	 Flotek Industries, Inc.
 Attn: Executive Vice President - Finance
 2930 W. Sam Houston Parkway North, Suite 300
 Houston, Texas 77043
 Facsimile: (713)
726-5363
  
 with a copy to:
  
 Andrews Kurth, LLP
 Attn: W. Mark Young
 600 Travis, Suite 4200
 Houston, Texas 77002
 Facsimile: (713) 238-7111

 if to a Guarantor, at its address on the signature page to this Agreement, and if to an Investor, at its address on the
signature page to this Agreement. 
 7.8 Survival of Representations, Warranties and Agreements. Notwithstanding any
investigation made by any party to this Agreement, all covenants, agreements, representations and warranties made by the Company and the Investors herein shall survive the execution of this Agreement, the delivery to the Investor of the Securities,
and a party’s reliance on such representations and warranties shall not be affected by any investigation made by such party or any information developed thereby. 
 7.9 Counterparts. This Agreement may be executed by facsimile signature and in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one
instrument. 
 7.10 Independent Nature of Investors’ Obligations and Rights. The obligations of each Investor under
this Agreement are several and not joint with the obligations of any other Investor, and no Investor shall be responsible in any way for the performance of the obligations of any other Investor under this Agreement. Nothing contained herein, and no
action taken by any Investor pursuant hereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture or any other

  

 Page 14 

 
kind of entity, or create a presumption that the Investors are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by this Agreement. Each
Investor confirms that it has independently participated in the negotiation of the transaction contemplated hereby with the advice of its own counsel and advisors. Each Investor 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 Investor to be joined as an additional party in any proceeding for such purpose. 
 [The remainder of this page is intentionally left blank.] 
  

 Page 15 

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	FLOTEK INDUSTRIES, INC.
		
	By	 	 /s/ John Chisholm

		 	John Chisholm
		 	President

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	 TELEDRIFT COMPANY
 FLOTEK PAYMASTER, INC.
 MATERIAL TRANSLOGISTICS, INC.
 PETROVALVE, INC.
 TURBECO, INC.
 USA PETROVALVE, INC.
 FLOTEK
INTERNATIONAL, INC.
 PADKO INTERNATIONAL INCORPORATED
 FLOTEK ECUADOR MANAGEMENT, LLC
 FLOTEK ECUADOR INVESTMENTS, LLC

		
	By	 	 /s/ John Chisholm

		 	John Chisholm
		 	President

			
	
	 Address for Notice:
 2930 W. Sam Houston Parkway North, Suite 300
 Houston, Texas 77043

	Attn:	 	Jempy Neyman
	Telephone:	 	(713) 726-5370
	Facsimile:	 	(713) 726-5363

  

			
	 SOONER ENERGY SERVICES, LLC
 CESI MANUFACTURING, LLC
 CESI CHEMICAL, INC.

		
	By	 	 /s/ John Chisholm

		 	John Chisholm
		 	Chief Executive Officer

  

			
	 Address for Notice:
 2930 W. Sam Houston Parkway North, Suite 300
 Houston, Texas 77043

	Attn:	 	Jempy Neyman
	Telephone:	 	(713) 726-5370
	Facsimile:	 	(713) 726-5363

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	FLOTEK INDUSTRIES FZE
		
	By	 	 /s/ John Chisholm

		 	John Chisholm
		 	President

  

			
	 Address for Notice:
 2930 W. Sam Houston Parkway North, Suite 300
 Houston, Texas 77043

	Attn:	 	Jempy Neyman
	Telephone:	 	(713) 726-5370
	Facsimile:	 	(713) 726-5363

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	 WHITEBOX HEDGED HIGH YIELD PARTNERS, LP

		
	By:	 	Whitebox Hedged High Yield Advisors, LLC
	Its:	 	General Partner
		
	By:	 	Whitebox Advisors LLC
	Its:	 	Managing Member
		
	By:	 	 /s/ Mark Strefling

	Name:	 	Mark Strefling
	Title:	 	Chief Legal Officer

  

	
	Tax Identification No.:
                                         
   
	State of Organization: British Virgin Islands
	State of Principal Place of Operations: Minnesota

  

	
	Address for Notice:
	c/o Whitebox Advisors LLC
	3033 Excelsior Blvd., Suite 300
	Minneapolis, MN 55416
	Attention: Jake Mercer
	Telephone: 612-253-6049
	Facsimile: 612-253-6100
	
	Delivery Instructions (if different from above):
	  

	  

	  

			
	Attention:	 	  

	Telephone:	 	  

	Facsimile:	 	  

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	IAM MINI-FUND 14 LIMITED
		
	By:	 	Whitebox Advisors LLC
	Its:	 	Investment Manager
		
	By:	 	 /s/ Mark Strefling

	Name:	 	Mark Strefling
	Title:	 	Chief Legal Officer

  

	
	Tax Identification No.:
                                         
   
	State of Organization: Cayman Islands
	State of Principal Place of Operations:
                    

  

	
	Address for Notice:
	c/o Whitebox Advisors LLC
	3033 Excelsior Blvd., Suite 300
	Minneapolis, MN 55416
	Attention: Jake Mercer
	Telephone: 612-253-6049
	Facsimile: 612-253-6100
	
	Delivery Instructions (if different from above):
	  

	  

	  

			
	Attention:	 	  

	Telephone:	 	  

	Facsimile:	 	  

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	PANDORA SELECT PARTNERS, LP
		
	By:	 	Pandora Select Advisors, LLC
	Its:	 	General Partner
		
	By:	 	Whitebox Advisors LLC
	Its:	 	Managing Member
		
	By:	 	 /s/ Mark Strefling

	Name:	 	Mark Strefling
	Title:	 	Chief Legal Officer

  

	
	Tax Identification No.:
                                         
   
	State of Organization: British Virgin Islands
	State of Principal Place of Operations: Minnesota

  

	
	Address for Notice:
	c/o Whitebox Advisors LLC
	3033 Excelsior Blvd., Suite 300
	Minneapolis, MN 55416
	Attention: Jake Mercer
	Telephone: 612-253-6049
	Facsimile: 612-253-6100
	
	Delivery Instructions (if different from above):
	  

	  

	  

			
	Attention:	 	  

	Telephone:	 	  

	Facsimile:	 	  

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	 WHITEBOX SPECIAL OPPORTUNITIES FUND, LP – SERIES B

		
	By:	 	Whitebox Special Opportunities Advisors, LLC
	Its:	 	General Partner
		
	By:	 	Whitebox Advisors LLC
	Its:	 	Managing Member
		
	By:	 	 /s/ Mark Strefling

	Name:	 	Mark Strefling
	Title:	 	Chief Legal Officer

  

	
	Tax Identification No.:
                                         
   
	State of Organization: British Virgin Islands
	State of Principal Place of Operations: Minnesota

  

	
	Address for Notice:
	c/o Whitebox Advisors LLC
	3033 Excelsior Blvd., Suite 300
	Minneapolis, MN 55416
	Attention: Jake Mercer
	Telephone: 612-253-6049
	Facsimile: 612-253-6100
	
	Delivery Instructions (if different from above):
	  

	  

	  

			
	 Attention:
	 	  

	 Telephone:
	 	  

	 Facsimile:
	 	  

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	WHITEBOX COMBINED PARTNERS, LP
		
	By:	 	Whitebox Combined Advisors, LLC
	Its:	 	General Partner
		
	By:	 	Whitebox Advisors LLC
	Its:	 	Managing Member
		
	By:	 	 /s/ Mark Strefling

	Name:	 	Mark Strefling
	Title:	 	Chief Legal Officer

  

	
	Tax Identification No.:
                                         
   
	State of Organization: British Virgin Islands
	State of Principal Place of Operations: Minnesota

  

	
	Address for Notice:
	c/o Whitebox Advisors LLC
	3033 Excelsior Blvd., Suite 300
	Minneapolis, MN 55416
	Attention: Jake Mercer
	Telephone: 612-253-6049
	Facsimile: 612-253-6100

  

	
	Delivery Instructions (if different from above):
	  

	  

	  

			
	Attention:	 	  

	Telephone:	 	  

	Facsimile:	 	  

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	 WHITEBOX CONVERTIBLE ARBITRAGE PARTNERS, LP

		
	By:	 	Whitebox Convertible Arbitrage Advisors, LLC
	Its:	 	General Partner
		
	By:	 	Whitebox Advisors LLC
	Its:	 	Managing Member
		
	By:	 	 /s/ Mark Strefling

	Name:	 	Mark Strefling
	Title:	 	Chief Legal Officer

  

	
	Tax Identification No.:
                                         
   
	State of Organization: British Virgin Islands
	State of Principal Place of Operations: Minnesota

  

	
	Address for Notice:
	c/o Whitebox Advisors LLC
	3033 Excelsior Blvd., Suite 300
	Minneapolis, MN 55416
	Attention: Jake Mercer
	Telephone: 612-253-6049
	Facsimile: 612-253-6100

  

	
	Delivery Instructions (if different from above):
	  

	  

	  

			
	Attention:	 	  

	Telephone:	 	  

	Facsimile:	 	  

 In witness whereof, the foregoing Exchange Agreement is hereby executed as of the date first
above written. 
  

			
	WHITEBOX INTERMARKET PARTNERS LP
		
	By:	 	Whitebox Intermarket Advisors LLC
	Its:	 	General Partner
		
	By:	 	Whitebox Advisors LLC
	Its:	 	Managing Member
		
	By:	 	 /s/ Mark Strefling

	Name:	 	Mark Strefling
	Title:	 	Chief Legal Officer

  

	
	Tax Identification No.:
                                         
   
	State of Organization: British Virgin Islands
	State of Principal Place of Operations: Minnesota

  

	
	Address for Notice:
	c/o Whitebox Advisors LLC
	3033 Excelsior Blvd., Suite 300
	Minneapolis, MN 55416
	Attention: Jake Mercer
	Telephone: 612-253-6049
	Facsimile: 612-253-6100

  

	
	Delivery Instructions (if different from above):
	  

	  

	  

			
	Attention:	 	  

	Telephone:	 	  

	Facsimile:	 	  

			
	ECF VALUE FUND, L.P.
		
	By:	 	Gates Capital Partners, L.P.
	Its:	 	General Partner
		
	By:	 	Gates Capital Management, Inc.
	Its:	 	General Partner
		
	By:	 	 /s/ Jeffrey L. Gates

	Name:	 	Jeffrey L. Gates
	Title:	 	President
	
	ECF VALUE FUND II, L.P.
		
	By:	 	Gates Capital Partners, L.P.
	Its:	 	General Partner
		
	By:	 	Gates Capital Management, Inc.
	Its:	 	General Partner
		
	By:	 	 /s/ Jeffrey L. Gates

	Name:	 	Jeffrey L. Gates
	Title:	 	President
	
	ECF VALUE FUND INTERNATIONAL LTD.
		
	By:	 	Gates Capital Management, Inc.
	Its:	 	Investment Advisor
		
	By:	 	 /s/ Jeffrey L. Gates

	Name:	 	Jeffrey L. Gates
	Title:	 	President

 EXHIBIT A 
 SCHEDULE OF INVESTORS 
  

							
	 Investor
	  	2008 Notes Held	  	2010 Notes to
be Received
	 Whitebox Hedged High Yield Partners, LP
	  	$	3,724,000	  	$	3,352,000
	 IAM Mini-Fund 14 Limited
	  	$	955,000	  	$	860,000
	 Pandora Select Partners, LP
	  	$	1,711,000	  	$	1,540,000
	 Whitebox Special Opportunities Fund, LP – Series B
	  	$	503,000	  	$	453,000
	 Whitebox Combined Partners, LP
	  	$	11,244,000	  	$	10,120,000
	 Whitebox Convertible Arbitrage Partners, LP
	  	$	4,196,000	  	$	3,777,000
	 Whitebox Intermarket Partners LP
	  	$	167,000	  	$	151,000
	 ECF Value Fund, L.P.
	  	$	8,892,000	  	$	8,003,00
	 ECF Value Fund II, L.P.
	  	$	5,612,000	  	$	5,051,000
	 ECF Value Fund International Ltd.
	  	$	2,696,400	  	$	2,697,000

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00171-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00171-of-00352.parquet"}]]