EXECUTION VERSION
October 25, 1999
BJ Services Company
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attn: Vice President Treasurer
Re: PURCHASE AGREEMENT
Ladies and Gentlemen:
Section 1. DEFINITIONS.
As used in this Purchase Agreement, the following terms shall have the
following meanings:
"BOFA INDEMNIFIED PARTY" means each of the Purchaser, Banc of America
Securities LLC and any other wholly-owned subsidiary of the Purchaser designated
by the Purchaser to receive or sell shares of Common Stock delivered hereunder.
"BUSINESS DAY" means any day that is not a Saturday, a Sunday or a day on
which banking institutions or trust companies in The City of New York are
authorized or obligated by law or executive order to close.
"CALL OPTION" has the meaning specified in Section 5.
"COMMISSION" means the Securities and Exchange Commission.
"COMMON STOCK" means the common stock of the Company.
"COMPANY" means BJ Services Company, a Delaware corporation.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FIRST PURCHASE DATE" has the meaning specified in Section 2(b).
"FIRST TRANCHE SHARES" has the meaning specified in Section 2(b).
"MATERIAL ADVERSE CHANGE" means any material adverse change, or any
development that could reasonably be expected to result in a material adverse
change, in the condition, financial or otherwise, or in the earnings, business,
operations or prospects, whether or not arising from transactions in the
ordinary course of business, of the Company and its subsidiaries, considered as
one entity.
"PERSON" means an individual, corporation, limited liability company,
partnership, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"PURCHASE DATE" has the meaning specified in Section 2(b).
"PURCHASE PRICE" has the meaning specified in Section 2(a).
"PURCHASE SHARES" has the meaning specified in Section 2(a).
"PURCHASER" means Bank of America, N.A.
"PUT OPTION" has the meaning specified in Section 5.
"RELEVANT EXCHANGE" means the principal national securities exchange or
automated quotation system on which the Common Stock is listed or quoted.
"RULE 144" has the meaning set forth in Section 3(e)(i).
"SEC FILINGS" means each document of the Company referred to in Section
3(e)(v)(A) and (B).
"SECOND PURCHASE DATE" has the meaning specified in Section 2(b).
"SECOND TRANCHE SHARES" has the meaning specified in Section 2(b).
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"THIRD PARTY PURCHASER" has the meaning specified in Section 2(d)(iii).
"TRANSFER RESTRICTIONS" means the restrictions on transfer of the
Purchase Shares set forth in Section 5.
Section 2. PURCHASE OF PURCHASE SHARES.
(a) PURCHASE AND SALE. The Company agrees to issue and sell to the
Purchaser 4,027,972 shares of Common Stock (the "PURCHASE SHARES") in two
tranches upon the terms herein set forth. On the basis of the
representations, warranties and agreements herein contained, and upon the
terms but subject to the conditions herein set forth, the Purchaser agrees to
purchase from the Company the Purchase Shares. The purchase price per
Purchase Share to be paid by the Purchaser to the Company shall be $35.75
(the "PURCHASE PRICE").
(b) CLOSINGS. Delivery of certificates for the first tranche of
Purchase Shares (which shall be 1,078,000 shares) (the "FIRST TRANCHE
SHARES") and payment for the First Tranche Shares shall be made at the
offices of Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
(or such other place as may be agreed to by the Company and the Purchaser) at
10:00 a.m., New York City time, on October 27, 1999, or such other time and
date as the parties may agree (the time and date of such closing are called
the "FIRST PURCHASE DATE"). Delivery of certificates for the second tranche
of Purchase Shares (which shall be 2,949,972 shares) (the "SECOND TRANCHE
SHARES") and payment for the Second Tranche Shares shall be made at 10:00
a.m., New York City time, on the Business Day following the First Purchase
Date or such other time and date as the parties may agree (the "SECOND
PURCHASE DATE" and, together with the First Purchase Date, the "PURCHASE
DATES") in the same manner and at the same location as on the First Purchase
Date.
(c) DELIVERY AND PAYMENT. Payment for the Purchase Shares shall be
made on the related Purchase Date by wire transfer of immediately available
funds to the order of the Company. The Company shall deliver, or cause to be
delivered, to the Purchaser certificates for the Purchase Shares being
purchased on such Purchase Date, against the irrevocable release of a wire
transfer of immediately available funds for the amount of the purchase price
therefor. The certificates for the Purchase Shares shall be in definitive
form and registered in such names and denominations as the Purchaser shall
have requested.
(d) CONDITIONS TO PURCHASE. The obligations of the Purchaser to
pay for the Purchase Shares as provided herein on the Purchase Dates shall be
subject to the prior execution and delivery by the parties of agreements with
respect to the Put Option and the Call Option, to the accuracy of the
representations and warranties on the part of the Company set forth in
Section 3 as of the date hereof, to the timely performance by the Company of
its covenants and other obligations hereunder, and to each of the following
additional conditions:
(i) the Company shall have caused to be delivered to the
Purchaser an opinion of counsel acceptable to the Purchaser, dated as of
the relevant Purchase Date, to the effect set forth in Exhibit A; and
(ii) the Company shall have caused to be delivered to the
Purchaser by the Treasurer of the Company, a certificate of such person
dated as of the relevant Purchase Date, to the effect that (A) the
representations and
warranties of the Company set forth in this Purchase Agreement are true
and correct as of such Purchase Date and (B) the Company has complied
with all the agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to such Purchase Date.
In addition, the obligations of the Purchaser to pay for the Second
Tranche Shares as provided herein on the Second Purchase Date shall be
subject to the acquisition of all First Tranche Shares by a third party
designated by the Purchaser (the "THIRD PARTY PURCHASER").
SECTION 3. REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
(a) BASIC REPRESENTATIONS. The Company represents and warrants to and
agrees with the Purchaser as follows:
(i) The Company is duly organized and existing and in good
standing under the laws of the jurisdiction of its incorporation.
(ii) The Company has all corporate power and authority to enter
into this Purchase Agreement and to consummate the transactions
contemplated hereby.
(iii) This Purchase Agreement has been duly authorized, executed
and delivered by, and is a valid and binding agreement of, the Company,
enforceable against the Company in accordance with its terms, except as
rights to indemnification and contribution hereunder may be limited by
applicable law and except as the enforcement hereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles.
(iv) The execution and delivery by the Company of, and the
compliance by the Company with all of the provisions of, this Purchase
Agreement and the consummation of the transactions herein contemplated
are within the Company's corporate powers and will not result in a breach
of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or any other material
agreement or instrument to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries is bound or
to which any of the material property or assets of the Company or any of
its subsidiaries is subject, nor will such action result in any violation
of the provisions of the Certificate of Incorporation or By-laws or other
constitutive documents of the Company or any material statute or any
order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its subsidiaries or any of
their respective properties.
(v) No consent, approval, authorization, order, registration,
qualification or filing of or with any court or governmental agency or
body having jurisdiction over the Company or any of its subsidiaries or
any of their respective properties is required for the execution and
delivery by the
Company of, and the compliance by the Company with all the terms of,
this Purchase Agreement or the consummation by the Company of the
transactions contemplated hereby.
(b) EQUITY REPRESENTATIONS. The Company makes the representations and
warranties to the Purchaser set forth in Annex A hereto.
(c) REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE PURCHASER. The
Purchaser represents and warrants to, and agrees with, the Company as follows:
(i) The Purchaser is duly organized and existing and in good
standing under the laws of the jurisdiction of its incorporation.
(ii) The Purchaser has all corporate power and authority to enter
into this Purchase Agreement and to consummate the transactions
contemplated hereby.
(iii) This Purchase Agreement has been duly authorized, executed
and delivered by, and is a valid and binding agreement of, the Purchaser,
enforceable against the Purchaser in accordance with its terms, except
as rights to indemnification and contribution hereunder may be limited by
applicable law and except as the enforcement hereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles.
(iv) The execution and delivery by the Purchaser of, and the
compliance by the Purchaser with all of the provisions of, this Purchase
Agreement and the consummation of the transactions herein contemplated
are within the Purchaser's corporate powers and will not result in a
breach of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or any
other material agreement or instrument to which the Purchaser or any of
its subsidiaries is a party or by which the Purchaser or any of its
subsidiaries is bound or to which any of the material property or assets
of the Purchaser or any of its subsidiaries is subject, nor will such
action result in any violation of the provisions of the Charter or
By-laws or other constitutive documents of the Purchaser or any material
statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Purchaser or any of its
subsidiaries or any of their respective properties.
(v) No consent, approval, authorization, order, registration,
qualification or filing of or with any court or governmental agency or
body having jurisdiction over the Purchaser or any of its subsidiaries or
any of their respective properties is required for the execution and
delivery by the Purchaser of, and the compliance by the Purchaser with
all the terms of, this Purchase Agreement or the consummation by the
Purchaser of the transactions contemplated hereby.
(vi) The Purchaser is knowledgeable, sophisticated and experienced in
making, and is qualified to make, decisions with respect to investments
in
shares presenting an investment decision like that involved in the
purchase of the Purchase Shares, including investments in securities
issued by the Company, and has requested, received, reviewed and
considered all information it deems relevant in making an informed
decision to purchase the Purchase Shares.
(vii) The Purchaser is acquiring the Purchase Shares in the ordinary
course of its business and for its own account for investment (as defined
for the purposes of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976 and the regulations thereunder) only and with no present intention
of distributing any of such Purchase Shares, except pursuant to a
registration statement effective under, or an exemption from the
registration requirements of, the Securities Act.
(viii) The Purchaser will not, directly or indirectly, sell or
otherwise dispose of (or solicit any offers to purchase or otherwise
acquire) any of the Purchase Shares except in compliance with the
Securities Act and any applicable state securities or blue sky laws or
pursuant to an available exemption or exclusion therefrom.
(ix) The Purchaser is an "accredited investor" within the meaning of
Rule 501 of Regulation D promulgated under the Securities Act.
(x) The Purchaser understands that the First Tranche Shares
will contain a legend to the following effect:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933. THE SHARES
HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THESE SHARES UNDER THE
SECURITIES ACT OF 1933 OR AN AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF SAID ACT. NO TRANSFER OF THE
SHARES WILL BE MADE ON THE BOOKS OF THE COMPANY UNLESS
ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH THESE
RESTRICTIONS.
The Purchaser agrees that it will obtain a letter of
representations substantially in the form of Exhibit B from the Third Party
Purchaser prior to the issuance of the First Tranche Shares to the Third
Party Purchaser.
(xi) The Purchaser understands that the Second Tranche Shares
will contain a legend to the following effect:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND ARE SUBJECT
TO CERTAIN TRANSFER
RESTRICTIONS CONTAINED IN THE PURCHASE
AGREEMENT DATED OCTOBER 25, 1999 (THE "TRANSFER
RESTRICTIONS"). THE SHARES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR
THESE SHARES UNDER THE SECURITIES ACT OF 1933 OR AN
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
SAID ACT AND COMPLIANCE WITH THE TRANSFER RESTRICTIONS. NO
TRANSFER OF THE SHARES WILL BE MADE ON THE BOOKS OF THE
COMPANY UNLESS THE COMPANY RECEIVES EVIDENCE OF COMPLIANCE
WITH THESE RESTRICTIONS.
(d) BRING-DOWN OF REPRESENTATIONS; REGISTRATION REPRESENTATIONS.
The Company shall make the representations and warranties set forth in
Sections 3(a) and 3(b) as of the date of this Purchase Agreement, as of each
Purchase Date and as of the date the Purchaser notifies the Company that the
Purchaser shall sell any of the Purchase Shares in accordance with the
Transfer Restrictions.
(e) RESALE AGREEMENTS. The Company covenants and agrees with the
Purchaser as follows:
(i) If, at any time following the date on which the Transfer
Restrictions shall have terminated and prior to the first date on which
the Purchaser may sell Purchase Shares in compliance with Rule 144 under
the Securities Act (together with any successor rule thereof, "RULE
144"), the Purchaser shall have notified the Company in writing of the
Purchaser's intention to transfer some or all of the Purchase Shares, the
Company shall, within five Business Days of receipt of such notice from
the Purchaser, promptly advise the Purchaser in writing of the occurrence
of any event or the existence of any condition as a result of which it is
necessary to amend or supplement the SEC Filings so that the SEC Filings
do not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(ii) If, at any time following the date on which the Transfer
Restrictions shall have terminated and prior to the first date on which
the Purchaser may sell Purchase Shares in compliance with Rule 144, in
the reasonable opinion of the Purchaser or counsel for the Purchaser it
is necessary to amend or supplement the SEC Filings to comply with law,
the Company agrees to promptly prepare, file with the Commission and
furnish at its own expense to the Purchaser, amendments or supplements to
the SEC Filings so that the SEC Filings as so amended or supplemented
will
comply with law.
(iii) The Company shall continue to engage and maintain, at its
expense, a registrar and transfer agent for the Common Stock.
(iv) The Company shall file, on a timely basis, with the Commission
and the Relevant Exchange all reports and documents required to be
filed under the Exchange Act or the rules of the Relevant Exchange.
(v) Until such time as the Transfer Restrictions shall have
terminated and the Purchaser may sell Purchase Shares in compliance
with Rule 144, the Company shall furnish to the Purchaser (A) as soon
as practicable after the end of each fiscal year, copies of the Annual
Report of the Company containing the balance sheet of the Company as
of the close of such fiscal year and statements of income,
stockholders' equity and cash flows for the year then ended and the
opinion thereon of the Company's independent public or certified
public accountants; (B) as soon as practicable after the filing
thereof, copies of each proxy statement, Annual Report on Form 10-K,
Quarterly Report on Form 10-Q, Current Report on Form 8-K or other
report filed by the Company under the Exchange Act with the Commission
or any securities exchange or automated quotation system; and (C) as
soon as available, copies of any report or communication of the
Company mailed generally to holders of its capital stock. In
addition, until such time as the Transfer Restrictions shall have
terminated and the Purchaser may sell Purchase Shares in compliance
with Rule 144, the Company shall furnish to the Purchaser as soon as
practicable after the filing thereof, copies of each filing made with
the Commission pursuant to the Securities Act after the date hereof.
(vi) On the date of any resale of Purchase Shares by the Purchaser
or any of its affiliates following the date on which the Transfer
Restrictions shall have terminated and prior to the first date on
which the Purchaser may sell Purchase Shares in compliance with Rule
144, if requested by the Purchaser at least five Business Days prior
to such date (any such request to be made no more often than once
every 30 days), the Company shall cause to be delivered to the
Purchaser by Deloitte & Touche LLP, independent public or certified
public accountants for the Company, a letter dated such date and
addressed to such recipient, in form and substance satisfactory to the
Purchaser, containing statements and information of the type
ordinarily included in accountant's "comfort letters" to underwriters,
delivered according to Statement of Auditing Standards No. 72 (or any
successor bulletin), with respect to the audited and unaudited
financial statements and certain financial information contained in
any SEC Filings.
(vii) On the date of any resale of Purchase Shares by the Purchaser
or any of its affiliates following the date on which the Transfer
Restrictions shall have terminated and prior to the first date on
which the Purchaser may sell
Purchase Shares in compliance with Rule 144, if requested by the
Purchaser at least five Business Days prior to such date (any such
request to be made no more often than once every 30 days), the Company
shall cause to be delivered to the Purchaser by counsel for the
Company as shall be designated by the Company and shall be reasonably
acceptable to the Purchaser, the favorable opinion of such counsel for
the Company, dated as of such date, the form of which is attached as
Exhibit A.
(viii) On the date of any resale of Purchase Shares by the Purchaser
or any of its affiliates following the date on which the Transfer
Restrictions shall have terminated and prior to the first date on
which the Purchaser may sell Purchase Shares in compliance with Rule
144, if requested by the Purchaser at least five Business Days prior
to such date (any such request to be made no more often than once
every 30 days), the Company shall cause to be delivered to the
Purchaser by the Chairman of the Board, Chief Executive Officer or
President of the Company and the Chief Financial Officer or Chief
Accounting Officer of the Company, a certificate of such person dated
as of such date, to the effect that:
(A) for the period from and after the date of the
last SEC Filing and prior to the proposed date of sale of the
Purchase Shares, there has not occurred any Material Adverse
Change;
(B) the representations and warranties of the Company
set forth in this Purchase Agreement are true and correct as
of such date; and
(C) the Company has complied with all the agreements
and satisfied all the conditions on its part to be performed
or satisfied at or prior to such date.
(ix) On the date of any resale of Purchase Shares by the Purchaser
or any of its affiliates following the date on which the Transfer
Restrictions shall have terminated and prior to the first date on
which the Purchaser may sell Purchase Shares in compliance with Rule
144, if requested by the Purchaser at least five Business Days prior
to such date (any such request to be made no more often than once
every 30 days), the Company shall cause to be delivered to the
Purchaser and counsel for the Purchaser such information, documents
and opinions as they may reasonably require for the purposes of
enabling them to pass upon the issuance and delivery of the Common
Stock as contemplated herein, or in order to evidence the accuracy of
any of the representations and warranties, or the satisfaction of any
of the conditions or agreements herein contained.
(x) In connection with any proposed resale of Purchase Shares by
the Purchaser or any of its affiliates following the date on which the
Transfer Restrictions shall have terminated and prior to the first
date on which the Purchaser may sell Purchase Shares in compliance
with Rule 144, the Company shall afford to the Purchaser a reasonable
opportunity to conduct a due diligence investigation with respect to
the Company customary in
scope for unregistered offerings of equity securities.
(f) LIMITATION ON STOCK REPURCHASES. The Company shall not repurchase
any shares of Common Stock if, as a result of such purchase, the number of
Second Tranche Shares would be equal to or greater than 4.7% of the number of
outstanding shares of Common Stock.
(g) SOLVENCY. The Company is solvent and able to pay its debts as
they come due, with assets having a fair value greater than the amount of the
Company's liabilities and with capital sufficient to carry on the businesses in
which it engages.
(h) EXPENSES. The Company agrees to pay all costs, fees and expenses
incurred in connection with the performance of its obligations hereunder and in
connection with the transactions contemplated hereby, including without
limitation (i) all expenses incident to the issuance and delivery of Common
Stock (including all printing and engraving costs), (ii) all fees and expenses
of the registrar and transfer agent of the Common Stock, (iii) all necessary
issue, transfer and other stamp taxes in connection with the issuance and
delivery of the Purchase Shares to the Purchaser and (iv) all fees and expenses
of the Company's counsel, independent public or certified public accountants and
other advisors. The Purchaser shall pay the fees and expenses of counsel for
the Purchaser and its affiliates incurred in connection with the transactions
contemplated by this Purchase Agreement.
SECTION 4. INDEMNIFICATION AND CONTRIBUTION.
(a) INDEMNIFICATION. (i) The Company agrees to indemnify and hold
harmless each of the BofA Indemnified Parties, their respective officers and
employees, and each person, if any, who controls any BofA Indemnified Party
within the meaning of the Securities Act and the Exchange Act against any loss,
claim, damage, liability or expense, as incurred, to which such BofA Indemnified
Party or such controlling person may become subject, under the Securities Act,
the Exchange Act or other federal or state statutory law or regulation, or at
common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Company), insofar as such
loss, claim, damage, liability or expense (or actions in respect thereof as
contemplated below) arises out of or is based (A) upon any untrue statement or
alleged untrue statement of a material fact contained in the SEC Filings, or the
omission or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; or (B) in whole or in part upon any inaccuracy in the
representations and warranties of the Company contained herein; or (C) in whole
or in part upon any failure of the Company to perform its obligations hereunder
or under law; or (D) upon any act or failure to act or any alleged act or
failure to act by any BofA Indemnified Person in connection with, or relating in
any manner to, the Common Stock or the transactions contemplated hereby
(including the resale of Purchaser Shares by the Purchaser or its affiliates in
compliance with the
Transfer Restrictions and the Securities Act), to the extent that such loss,
claim, damage, liability or action arises out of or is based upon any matter
covered by clause (A) above; provided that the Company shall not be liable
under this clause (D) to the extent that a court of competent jurisdiction
shall have determined by a final judgment that such loss, claim, damage,
liability or action resulted directly from any such acts or failures to act
undertaken or omitted to be taken by such BofA Indemnified Party through its
gross negligence, bad faith or willful misconduct; and to reimburse each BofA
Indemnified Person and each such controlling person for any and all expenses
(including the reasonable fees and disbursements of one counsel chosen by the
Purchaser or such BofA Indemnified Person) as such expenses are reasonably
incurred by such BofA Indemnified Person or such controlling person in
connection with investigating, defending, settling, compromising or paying
any such loss, claim, damage, liability, expense or action. The indemnity
agreement set forth in this Section 4(a)(i) shall be in addition to any
liabilities that the Company may otherwise have.
(ii) Promptly after receipt by an indemnified party under this
Section 4(a) of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against an indemnifying party under this Section 4(a), notify the
indemnifying party in writing of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve it from
any liability that it may have to any indemnified party for
contribution or otherwise than under the indemnity agreement contained
in this Section 4(a) or to the extent it is not prejudiced as a
proximate result of such failure. In case any such action is brought
against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying
party will be entitled to participate in, and, to the extent that it
shall elect, jointly with all other indemnifying parties similarly
notified, by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified
party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided that if the
defendants in any such action include both the indemnified party and
the indemnifying party and the indemnified party shall have reasonably
concluded that a conflict may arise between the positions of the
indemnifying party and the indemnified party in conducting the defense
of any such action or that there may be legal defenses available to it
that are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the
right to select separate counsel to assume such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of such indemnifying
party's election so to assume the defense of such action and approval
by the
indemnified party of counsel, the indemnifying party will not be
liable to such indemnified party under this Section 4(a) for any legal
or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless (A) the indemnified party
shall have employed separate counsel in accordance with the proviso to
the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than
one separate counsel (together with local counsel), approved by the
indemnifying party, representing the indemnified parties who are
parties to such action) or (B) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of
commencement of the action, in each of which cases the fees and
expenses of counsel shall be at the expense of the indemnifying party.
(iii) The indemnifying party under this Section 4(a) shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment
for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or expense
by reason of such settlement or judgment. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement, compromise or consent to the entry of judgment in any pending
or threatened action, suit or proceeding in respect of which any
indemnified party is or could have been a party and indemnity was or
could have been sought hereunder by such indemnified party, unless such
settlement, compromise or consent includes an unconditional release of
such indemnified party from all liability on claims that are the subject
matter of such action, suit or proceeding.
(b) (i) If the indemnification provided for in Section 4(a) is for any
reason held to be unavailable to or otherwise insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount paid or payable by such indemnified party, as incurred, as
a result of any losses, claims, damages, liabilities or expenses referred to
therein (A) in such proportion as is appropriate to reflect the relative
benefits received by the Company, on the one hand, and the BofA Indemnified
Parties, on the other hand, from the transactions contemplated by this Purchase
Agreement or (B) if the allocation provided by clause (A) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (A) above but also the relative fault of
the Company, on the one hand, and the BofA Indemnified Parties, on the other
hand, in connection with the statements or omissions or inaccuracies in the
representations and warranties herein that resulted in such losses, claims,
damages, liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by
the Company, on the one hand, and the BofA Indemnified Parties, on the other
hand, in connection with the transactions contemplated by this Purchase
Agreement shall be deemed to be the aggregate Purchase Price paid hereunder.
The relative fault of the Company, on the one hand, and the BofA Indemnified
Parties, on the other hand, shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact or any such
inaccurate or alleged inaccurate representation or warranty relates to
information supplied by the Company, on the one hand, or the Purchaser, on
the other hand, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
(ii) The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above
shall be deemed to include, subject to the limitations set forth in
Section 4(a)(ii), any legal or other fees or expenses reasonably
incurred by such party in connection with investigating or defending
any action or claim. The provisions set forth in Section 4(a)(ii) with
respect to notice of commencement of any action shall apply if a claim
for contribution is to be made under this Section 4(b); provided that
no additional notice shall be required with respect to any action for
which notice has been given under Section 4(a)(ii) for purposes of
indemnification.
(iii) The Company and the Purchaser agree that it would not be just
and equitable if contribution pursuant to this Section 4(b) were
determined by PRO RATA allocation (even if the BofA Indemnified
Parties were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the equitable
considerations referred to in this Section 4(b).
(iv) Notwithstanding the provisions of this Section 4(b), the
Purchaser shall not be required to contribute any amount in excess of
the amount (if any) by which (x) the amount by which the aggregate
nine-month forward price of the Purchase Shares exceeds the aggregate
Purchase Price, exceeds (y) the amount of any damages that the
Purchaser has otherwise been required to pay in connection herewith.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 4(b), each officer
and employee of a BofA Indemnified Person and each person, if any, who
controls a BofA Indemnified Person within the meaning of the
Securities Act and the Exchange Act shall have the same rights to
contribution as such BofA Indemnified Person, and each person, if any,
who controls the Company with the meaning of the Securities Act and
the Exchange Act shall have the same rights to contribution as the
Company.
Section 5. TRANSFER RESTRICTIONS AND VOTING AGREEMENT.
Prior to the earlier of (i) the expiration or earlier termination of
the put options to be granted by the Company to the Purchaser pursuant to a
letter agreement to be dated on or about October 25, 1999 (the "PUT OPTION")
or the call options to be granted by the Purchaser to the Company pursuant to
a letter agreement to be dated on or around October 25, 1999 (the "CALL
OPTION") and (ii) any default by the Company under either the Put Option or
the Call Option, (x) the Purchaser shall not sell or transfer any of the
Second Tranche Shares to any party other than a wholly-owned subsidiary of
the Purchaser and (y) all Second Tranche Shares shall be voted by the holder
thereof on any matter submitted for a vote (or consent) of the Company's
stockholders in proportion to the votes cast by the holders of the Common
Stock other than the Purchaser and its affiliates.
Section 6. GOVERNING LAW.
THIS PURCHASE AGREEMENT SHALL BE GOVERNED BY THE LAW OF THE STATE OF
NEW YORK WITHOUT REFERENCE TO THE CHOICE OF LAW RULES THEREOF.
Section 7. ASSIGNMENT AND TRANSFER.
The rights and duties under this Purchase Agreement may not be
assigned or transferred by either party hereto without the prior written
consent of the other party hereto; provided that the Purchaser may assign any
of its rights or duties hereunder to any of its wholly-owned subsidiaries
without the prior written consent of the Company.
Section 8. NOTICES.
Unless otherwise specified, notices under this contract may be made by
telephone, to be confirmed in writing to the address below. Changes to the
information below must be made in writing.
(a) If to the Company:
BJ Services Company
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attn: Vice President Treasurer
Telephone: 000-000-0000
Facsimile: 000-000-0000
(b) If to the Purchaser:
Bank of America, N.A.
c/o NationsBanc Xxxxxxxxxx Securities LLC
0 X. 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Section 9. THIRD PARTY BENEFICIARIES. No provision of this Purchase
Agreement is intended to confer upon any Person other than the parties
hereto any rights or remedies hereunder.
Please confirm your agreement to the foregoing by signing and
returning to us the enclosed duplicate of this Purchase Agreement.
Very truly yours,
BANK OF AMERICA, N.A.
By: /S/ Xxxxxxx Xxxxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Managing Director
Acknowledged and agreed to as of
the date first above written,
BJ SERVICES COMPANY
By: /s/ X. X. Xxxxxxxx
-----------------------------------
Name: X. X. Xxxxxxxx
Title: Vice President and Treasurer
ANNEX A
EQUITY REPRESENTATIONS
(a) The Purchase Shares have been duly authorized for issuance and
delivery pursuant to this Purchase Agreement and, when issued and delivered
by the Company pursuant to this Purchase Agreement, will be validly issued,
fully paid and nonassessable.
(b) Deloitte & Touche, who have expressed their opinion with
respect to the financial statements (which term as used in this Purchase
Agreement includes the related notes thereto) and supporting schedules, if
any, filed with the Commission as a part of the most recent applicable SEC
Filings are independent public or certified public accountants as required by
the Exchange Act.
(c) The financial statements filed with the Commission as a part of
the most recent applicable SEC Filings present fairly the consolidated
financial position of the Company and its subsidiaries as of and at the dates
indicated and the results of their operations and cash flows for the periods
specified. The supporting schedules, if any, included in the most recent
applicable SEC Filings present fairly the information required to be stated
therein. Such financial statements and supporting schedules, if any, have
been prepared in conformity with generally accepted accounting principles as
applied in the United States applied on a consistent basis throughout the
periods involved, except as may be expressly stated in the related notes
thereto. No other financial statements or supporting schedules are required
to be included in any SEC Filing made since October 1, 1998.
(d) Except as otherwise disclosed in the most recent applicable SEC
Filings and except for the transactions contemplated in connection with the
Purchase Agreement, since the date of the Company's most recent audited
financial statements included in the SEC Filings: (i) there has been no
Material Adverse Change; and (ii) the Company and its subsidiaries,
considered as one entity, have not incurred any material liability or
obligation, indirect, direct or contingent, not in the ordinary course of
business nor entered into any material transaction or agreement not in the
ordinary course of business.
(e) The Company and each of its material subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as currently conducted and, in the case of the Company, to enter
into and perform its obligations under this Purchase Agreement, except, in
the case of such subsidiaries, for such jurisdictions and with respect to
such properties and business, where the failure to be in good standing or
have such corporate powers and authority would not, individually or in the
aggregate, result in a Material Adverse Change. Each of the Company and each
of its subsidiaries is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except for such jurisdictions where the failure to so qualify or to
be in good standing would not, individually or in the aggregate, result in a
Material Adverse Change. Except as previously disclosed by the Company to
the Purchaser in writing, except for directors' qualifying shares, and except
as would not, individually or in the aggregate, result in a Material Adverse
Change, all of the issued and outstanding capital stock of each subsidiary
has been duly authorized and validly issued, is fully paid and nonassessable
and is owned by the Company, directly or through subsidiaries, free and clear
of any security interest, mortgage, pledge, lien, encumbrance or claim
(f) All of the issued and outstanding shares of Common Stock have
been duly authorized and validly issued, are fully paid and nonassessable and
have been issued in compliance with federal and state securities laws. The
Common Stock conforms in all material respects to the description thereof
contained in the most recent applicable SEC Filings. None of the outstanding
shares of Common Stock were issued in violation of any preemptive rights,
rights of first refusal or other similar rights to subscribe for or purchase
securities of the Company. There are no authorized options, warrants,
preemptive rights, rights of first refusal or other rights to purchase, or
equity or debt securities convertible into or exchangeable or exercisable
for, any capital stock of the Company or any of its subsidiaries other than
those accurately described in the most recent applicable SEC Filings. Except
as previously disclosed by the Company to the Purchaser in writing, the
description of the Company's stock option, stock bonus and other stock plans
or arrangements set forth in the most recent applicable SEC Filings
accurately and fairly presents the information required to be shown with
respect to such plans, arrangements, options and rights.
(g) The SEC Filings made since October 1, 1998, as of their
respective filing dates, did not include 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 the light of the circumstances
under which they were made, not misleading.
(h) Neither the Company nor any of its subsidiaries is in violation
of its charter or by-laws or is in default (or, with the giving of notice or
lapse of time, would be in default) ("DEFAULT") under any indenture,
mortgage, loan or credit agreement, note, contract, franchise, lease or other
instrument to which the Company or any of its subsidiaries is a party or by
which it or any of them may be bound, or to which any of the property or
assets of the Company or any of its subsidiaries is subject (each, an
"EXISTING INSTRUMENT"), except for such Defaults as would not, individually
or in the aggregate, result in a Material Adverse Change. The Company's
execution, delivery and performance of this Purchase Agreement and
consummation of the transactions contemplated hereby (i) have
been duly authorized by all necessary corporate action and will not result in
any violation of the provisions of the charter or by-laws of the Company or
any subsidiary, (ii) will not conflict with or constitute a breach of, or a
Default or a Debt Repayment Triggering Event (as defined below) under, or
result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its subsidiaries pursuant to,
or require the consent of any other party to, any Existing Instrument, except
for such conflicts, breaches, Defaults, liens, charges or encumbrances as
would not, individually or in the aggregate, result in a Material Adverse
Change and (iii) will not result in any violation of any material law,
administrative regulation or administrative or court decree applicable to the
Company or any subsidiary. No consent, approval, authorization or other
order of, or registration or filing with, any court or other governmental or
regulatory authority or agency, is required for the Company's execution,
delivery and performance of this Purchase Agreement and consummation of the
transactions contemplated hereby or thereby, except such as have been or will
be obtained or made by the Company and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and from the
National Association of Securities Dealers, Inc. As used herein, a "DEBT
REPAYMENT TRIGGERING EVENT" means any event or condition that gives, or with
the giving of notice or lapse of time would give, the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or repayment
of all or a portion of such indebtedness by the Company or any of its
subsidiaries.
(i) Except as otherwise disclosed in the most recent applicable SEC
Filings, there are no legal or governmental actions, suits or proceedings
pending or, to the best of the Company's knowledge, threatened (i) against or
affecting the Company or any of its subsidiaries, (ii) that has as the
subject thereof any officer or director of, or property owned or leased by,
the Company or any of its subsidiaries or (iii) relating to environmental or
employment discrimination matters, where in any such case (A) there is a
reasonable possibility that such action, suit or proceeding will be
determined adversely to the Company or such subsidiary and (B) any such
action, suit or proceeding, if so determined adversely, would reasonably be
expected to result in a Material Adverse Change or adversely affect the
consummation of the transactions contemplated by this Purchase Agreement.
Except as otherwise disclosed in the most recent applicable SEC Filings, no
material labor dispute with the employees of the Company or any of its
subsidiaries exists or, to the best of the Company's knowledge, is threatened
or imminent.
(j) The Company has been advised of the rules and requirements
under the Investment Company Act of 1940, as amended (the "INVESTMENT COMPANY
ACT"). The Company is not, and after receipt of payment for the Purchase
Shares and the consummation of the transactions contemplated hereby will not
be, an "investment company" within the meaning of Investment Company Act and
will conduct its business in a manner so that it will not become subject to
the
Investment Company Act.
(k) The Company has not taken and will not take, directly or
indirectly, any action designed to or that might be reasonably expected to
cause or result in stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of any shares of Common Stock
delivered hereunder.
(l) There are no business relationships or related-party
transactions involving the Company or any subsidiary or any other person
required to be described in the SEC Filings made since October 1, 1998 that
have not been described as required.
EXHIBIT A
FORM OF OPINION OF COUNSEL
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware.
(ii) The Company has corporate power and authority to own, lease
and operate its properties and to conduct its business as currently
conducted and to enter into and perform its obligations under the
Purchase Agreement.
(iii) The authorized, issued and outstanding capital stock of the
Company conform to the descriptions thereof set forth in the most recent
applicable SEC Filings, except as set forth in Schedule I with respect to
exercises of options. The form of certificate used to evidence the
Common Stock is in due and proper form and complies with all applicable
requirements of the charter and by-laws of the Company and the General
Corporation Law of the State of Delaware.
(iv) No stockholder of the Company or any other person has any
preemptive right, right of first refusal or other right similar to a
preemptive right or a right of first refusal to subscribe for or purchase
securities of the Company arising (A) by operation of the charter or
by-laws of the Company or of the State of Delaware or (B) to the best
knowledge of such counsel, otherwise. (1)
(v) The Purchase Agreement has been duly authorized, executed
and delivered by, and is a valid and binding agreement of, the Company,
enforceable in accordance with its terms, except as rights to
indemnification and contribution thereunder may be limited by applicable
law and except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to
or affecting creditors' rights generally or by general equitable
principles.
(vi) The Purchase Shares have been duly authorized for issuance
and delivery pursuant to the Purchase Agreement and, when issued and
delivered by the Company pursuant to the Purchase Agreement against
payment of the consideration set forth therein, will be validly issued,
fully paid and
--------------------------------
(1) Note that the opinion will contain a reference to the
"poison pill" provisions contained in the Company's shareholder rights
agreement.
nonassessable.(2)
(vii) To the best knowledge of such counsel, there are no
legal or governmental actions, suits or proceedings pending or
threatened that are required to be disclosed in any SEC Filing, other
than those disclosed therein.
(viii) No consent, approval, authorization or other order
of, or registration or filing with, any court or other governmental
authority or agency, is required for the Company's execution, delivery
and performance of the Purchase Agreement and consummation of the
transactions contemplated thereby.
(ix) The execution and delivery of the Purchase Agreement by
the Company and the performance by the Company of its obligations
thereunder (A) have been duly authorized by all necessary corporate
action on the part of the Company; (B) will not result in any
violation of the provisions of the charter or by-laws of the Company
or any subsidiary; (C) to the best knowledge of such counsel, will not
constitute a breach of, or Default or a Debt Repayment Triggering
Event under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to, any material agreement for
borrowed money to which the Company or any of its subsidiaries is a
party or by which the Company's or any of its subsidiaries' assets are
bound; or (D) to the best knowledge of such counsel, will not result
in any violation of any law, administrative regulation or
administrative or court decree applicable to the Company or any
subsidiary (it being understood that such counsel shall express no
opinion with regard to the Commodity Exchange Act, since such counsel
is unfamiliar with the provisions of such Act).
(x) The Company is not, and after receipt of payment for the
Purchase Shares and the consummation of the transactions contemplated
by the Purchase Agreement will not be, an "investment company" within
the meaning of Investment Company Act.
(xi) To the best knowledge of such counsel, neither the
Company nor any subsidiary is in violation of its charter or by-laws
or any law, administrative regulation or administrative or court
decree applicable to the Company or any subsidiary or is in Default in
the performance or observance of any obligation, agreement, covenant
or condition contained in any material agreement for
-----------------------------------
(2) Note that the opinion will contain a reference to the Put
Option and the Call Option.
borrowed money to which the Company or any of its subsidiaries
is a party or by which the Company's or any of its subsidiaries'
assets are bound, except in each such case for such violations or
Defaults as would not, individually or in the aggregate, result in a
Material Adverse Change.
(xii) Each SEC Filing made since October 1, 1998, as of
its date (other than the financial statements and supporting schedules
included or incorporated by reference therein or in exhibits to or
excluded from such SEC Filing, as to which no opinion need be
rendered) complied as to form in all material respects with the
applicable requirements of the Exchange Act.
(xiii) To the best knowledge of such counsel, there are no
agreements for borrowed money to which the Company or any of its
subsidiaries is a party or by which the Company's or any of its
subsidiaries' assets are bound required to be described or referred to
in any SEC Filing or to be filed as exhibits thereto other than those
described or referred to therein or filed or incorporated by reference
as exhibits thereto; and the descriptions thereof and references
thereto are correct in all material respects.
In addition, such counsel shall state that they have
participated in conferences with officers and other representatives of
the Company at which the contents of each SEC Filing and related
matters were discussed and, although such counsel is not passing upon
and does not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in such SEC Filings, and any
supplements or amendments thereto, on the basis of the foregoing,
nothing has come to their attention that would lead them to believe
that such SEC Filing, as of its date or (taken as a whole together
with all other SEC Filings) as of the date of such opinion, contained
an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading (it
being understood that such counsel need express no belief as to the
financial statements or schedules or other financial or statistical
data derived therefrom, included or incorporated by reference in any
SEC Filing).
EXHIBIT B
[PURCHASER LETTERHEAD]
[DATE]
BANK OF AMERICA, N.A.
C/O NATIONSBANC XXXXXXXXXX SECURITIES LLC
0 X. 00XX XXXXXX
XXX XXXX, XX 00000
Ladies and Gentlemen:
In connection with the sale to, and the purchase by, [ ] (the
"Purchaser"), of [ ] shares (the "Shares") of common stock (the Common
Stock"), of BJ Services from Banc of America Securities LLC (the
"Seller"), we hereby represent and warrant to you as follows:
(i) The Shares are being acquired by the Purchaser for its own
account, not as a nominee or agent, for investment and not with a view
to resale or distribution within the meaning of the Securities Act of
1933, as amended (the "1933 Act"), and the rules and regulations
thereunder, and the Purchaser will not distribute the Shares in
violation or contravention of any applicable securities laws.
(ii) The Purchaser acknowledges that (a) the Shares are not
registered under the 1933 Act, (b) the Shares will not be transferable
unless so registered or unless an exemption from such registration is
applicable and (c) the certificates representing the Shares will bear a
legend substantially in the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933. THE SHARES HAVE BEEN
ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THESE SHARES
UNDER THE SECURITIES ACT OF 1933 OR AN AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF SAID ACT. NO TRANSFER OF THE SHARES WILL
BE MADE ON THE BOOKS OF THE COMPANY UNLESS ACCOMPANIED BY EVIDENCE OF
COMPLIANCE WITH THESE RESTRICTIONS."
(iii) The Purchaser represents and warrants to the Seller, that
the Purchaser (i) is an "accredited investor" as such term is defined in
Regulation D under the 1933 Act and is financially able to purchase the
Shares, (ii) is fully capable of understanding the type of investment
being made by its purchase of the Shares pursuant to this Agreement and
the risks involved in connection therewith, (iii) believes that the
nature of the Shares is consistent with its overall investment programs
and financial position, (iv) recognizes that there are substantial risks
involved in its purchase of the Shares, (v) is capable of bearing the
economic risk of its investment for an indefinite period of time and can
afford a complete loss of its investment, (vi) has adequate means of
providing for its current liquidity needs, (vii) has no need for
liquidity of its investment, (viii) is not expecting any short term
income from its investment and (ix) has no reason to anticipate any
change in its circumstances, financial or otherwise, that may cause or
require any sale of the Shares.
(iv) The Purchaser acknowledges that it has had the opportunity to
ask questions of and receive answers from officers and directors of the
Seller concerning the business, financial condition and prospects of the
Issuer; and the Purchaser has received to its satisfaction, such
additional information about the business, financial condition and
prospects of the issuer, as it has requested. At no time was the
Purchaser presented with or solicited by or through any public
advertising or general solicitation.
(v) The Purchaser has received no representations or warranties
from the Seller or its officers, directors, employees, or agents, or any
other person and, in making the proposed investment decision, the
Purchaser is relying solely on its own investigations.
Yours truly,
[PURCHASER]
By: ____________________________
Name:
Title:
October 27, 1999
To: BJ Services Company
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
From: Bank of America, N.A.
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Re: Share Option Transaction
Reference: NY-2966C
The purpose of this letter agreement is to confirm the terms and
conditions of the Transaction entered into between BANK OF AMERICA, N.A.,
("BofA") and BJ SERVICES COMPANY ("Counterparty") on the Trade Date specified
below (the "Transaction"). This letter agreement constitutes a
"Confirmation" as referred to in the ISDA Master Agreement specified below.
The definitions and provisions contained in the 1996 ISDA Equity
Derivatives Definitions (the "Equity Definitions"), as published by the
International Swaps and Derivatives Association, Inc., are incorporated into
this Confirmation. In the event of any inconsistency between the Equity
Definitions and this Confirmation, this Confirmation shall govern. This
Confirmation evidences a complete binding agreement between the Counterparty
and BofA as to the terms of the Transaction to which this Confirmation
relates.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in, or refrained from engaging in, substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Transaction to which this Confirmation relates on
the terms and conditions set forth below.
1. If the Counterparty and BofA have entered into an ISDA Master
Agreement (the "Agreement"), then this Confirmation supplements, forms a part
of, and is subject to, that Agreement, as amended and supplemented from time
to time. All provisions contained in the Agreement govern this Confirmation
except as expressly modified below. If the Counterparty and BofA have not
entered into an ISDA Master Agreement, then they agree to use all reasonable
efforts to promptly negotiate, execute and deliver an agreement in the form
of the ISDA Master Agreement (Multicurrency-Cross Border) (the "ISDA Form"),
with such modifications as the Counterparty and BofA will in good faith
agree. Upon the execution of such an agreement, this Confirmation will
supplement, form a part of, and be subject to, that agreement. All
provisions contained or incorporated by reference in that agreement upon its
execution will govern this Confirmation except as expressly modified below.
Until the parties execute and deliver that agreement, this Confirmation,
together with all other documents relating to the ISDA Form (each a
"Confirmation") confirming transactions (each a "Transaction") entered into
between us (notwithstanding anything to the contrary in a Confirmation),
shall supplement, form a part of, and be subject to an agreement in the form
of the ISDA Form as if we had executed an agreement in such form (but without
any Schedule) on the Trade Date of the first such Transaction between us
(such agreement, or the ISDA Form, hereinafter the "Agreement"). In the
event of any inconsistency between the provisions of the agreement and this
Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
1
2. The terms of the particular Transaction to which this Confirmation
relates are as follows:
General Terms
Trade Date: October 25, 1999
Option Style: European
Option Type: Call
Seller: BofA
Buyer: Counterparty
Shares: The common stock of BJ Services
Company (the "Issuer") (Exchange
symbol "BJS")
Number of Options: 1,078,000
Option Entitlement: One Share per Option
Strike Price: U.S. $37.0091
Premium: U.S. $1,156,155.00
Premium Payment Date: October 27, 1999
Exchange(s): New York Stock Exchange
Related Exchange(s): The principal exchange(s) for options
contracts or futures contracts, if
any, with respect to the Shares
Procedure for Exercise:
Expiration Time: At the close of trading on the
Exchange
Expiration Date: April 19, 2000
In-the-Money: That the Reference price is greater
than the Strike Price
Automatic Exercise: Applicable
Valuation Date: The Expiration Date
For the avoidance of doubt, the first two lines of Section 4.3(a) of the
Equity Definitions are amended to read: 'Section 4.3 Market Disruption
Event. (a) "Market Disruption Event" in relation to a Physically-settled
Option Transaction" means:'
Reference Price: The closing price per Share on the
Exchange at the Valuation Time on the
Valuation Date
Seller's Telephone
2
Number and Facsimile Number
and Contact Details for Purpose Telephone No.: 000-000-0000
of Giving Notice: Telecopy No.: 000-000-0000
Settlement Terms:
Physical Settlement: Applicable
Failure to Deliver: Applicable
Adjustments:
Method of Adjustment: Calculation Agent Adjustment
Extraordinary Events:
Consequences of Merger Events
(a) Share-for-Share: Alternative Obligation
(b) Share-for-Other: Cancellation and Payment
(c) Share-for-Combined: Cancellation and Payment
Nationalization or Insolvency: Negotiated Close-out
3. Calculation Agent: BofA
4. Accounts Details:
Payments to BofA:
Pay to: Bank of America, N.A.
F/A/O: Equity Derivatives - Bank
Account No. : 0659795652
Routing No. : 000000000
Payments to Counterparty:
Please provide to expedite payment.
5. Offices:
(a) The Office of BofA for the Transaction is: Charlotte
Address and phone numbers for Notices:
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
(b) The Office of the Counterparty for the Transaction is:
Inapplicable. Counterparty is not a Multibranch Party.
3
Address and phone numbers for Notices:
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
6. Other Provisions
(a) NON-RELIANCE. It is acting for its own account, and it has made
its own independent decision to enter into this Transaction and as
to whether this Transaction is appropriate or proper for it based
upon its own judgement and upon advice from such advisors as it
has deemed necessary. It is not relying on any communication
(written or oral) of the other party as investment advice or as a
recommendation to enter into this Transaction; it being understood
that information and explanations related to the terms and
conditions of this Transaction shall not be considered investment
advice or a recommendation to enter into this Transaction. It has
not received from the other party any assurance or guarantee as to
the expected results of this Transaction.
(b) DESIGNATION BY BOFA. Notwithstanding any other provision in this
Confirmation to the contrary requiring or allowing BofA to
purchase, sell, receive or deliver any shares or other securities
to or from the Counterparty, BofA may designate any of its
affiliates to purchase, sell, receive or deliver such shares or
other securities and otherwise to perform BofA obligations in
respect of this Transaction and any such designee may assume such
obligations. BofA shall be discharged of its obligations to the
Counterparty to the extent of any such performance.
(c) RISK MANAGEMENT. It has entered into this Transaction for the
purpose of managing its borrowings or investments, hedging its
underlying assets or liabilities or in connection with its line of
business.
(d) EVALUATION AND UNDERSTANDING. It is capable of evaluating and
understanding (on its own behalf or through independent
professional advice), and understands and accepts, the terms,
conditions and risks of this Transaction. It is also capable of
assuming, and assumes, the financial and other risks of this
Transaction.
(e) STATUS OF PARTIES. The other party is not acting as a fiduciary or
an advisor for it in respect of this Transaction.
(f) NO INFORMATION. The Counterparty represents and warrants that it
and its affiliates are not entering into the Transaction on the
basis of any material non-public information with respect to the
Shares.
(g) PRIVATE PLACEMENT. Each of Counterparty and BofA represents that
it (A) is an "accredited investor" within the meaning of Rule
501(a) under the Securities Act of 1933 (the "Securities Act"),
(B) is acquiring the instruments described in the Transaction for
its own account, and not with a view to distribution and (C)
understands and acknowledges that the Transaction has not and will
not be registered under the Securities Act.
(h) PAYMENTS UPON CERTAIN EXTRAORDINARY EVENTS. Section 9.7(b)(i) of
the Equity Definitions is amended by deleting the words "two-year"
in the second line and replacing them with the words "180 calendar
day".
(i) CONDITIONS OF EFFECTIVENESS. If the purchase of the First Tranche
Shares (as defined in the Purchase Agreement dated October 25,
1999 between BofA and the Counterparty) is not successfully
closed, then this Transaction shall be of no effect and no
financial compensation shall be due either party.
4
Please confirm your acceptance and agreement with the foregoing by
immediately executing the copy of this Confirmation enclosed for that purpose
and returning it to Bank of America, N.A. by facsimile at 000-000-0000.
Very truly yours,
BANK OF AMERICA, N.A.
By: /s/ Xxxxxxx Xxxxxxxxx
-------------------------
Authorized Signatory
Name: Xxxxxxx Xxxxxxxxx
Confirmed
as of the date first above written:
BJ SERVICES COMPANY
By: /s/ X. X. Xxxxxxxx
--------------------
Authorized Signatory
Name: X. X. Xxxxxxxx
5
October 27, 1999
To: BJ Services Company
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
From: Bank of America, N.A.
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone 000-000-0000
Facsimile: 000-000-0000
Re: Share Option Transaction
Reference: NY-2966P
The purpose of this letter agreement is to confirm the terms and
conditions of the Transaction entered into between BANK OF AMERICA, N.A.,
("BofA") and BJ SERVICES COMPANY ("Counterparty") on the Trade Date specified
below (the "Transaction"). This letter agreement constitutes a
"Confirmation" as referred to in the ISDA Master Agreement specified below.
The definitions and provisions contained in the 1996 ISDA Equity
Derivatives Definitions (the "Equity Definitions"), as published by the
International Swaps and Derivatives Association, Inc., are incorporated into
this Confirmation. In the event of any inconsistency between the Equity
Definitions and this Confirmation, this Confirmation shall govern. This
Confirmation evidences a complete binding agreement between the Counterparty
and BofA as to the terms of the Transaction to which this Confirmation
relates.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in, or refrained from engaging in, substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Transaction to which this Confirmation relates on
the terms and conditions set forth below.
1. If the Counterparty and BofA have entered into an ISDA Master
Agreement (the "Agreement"), then this Confirmation supplements, forms a part
of, and is subject to, that Agreement, as amended and supplemented from time
to time. All provisions contained in the Agreement govern this Confirmation
except as expressly modified below. If the Counterparty and BofA have not
entered into an ISDA Master Agreement, then they agree to use all reasonable
efforts to promptly negotiate, execute and deliver an agreement in the form
of the ISDA Master Agreement (Multicurrency-Cross Border) (the "ISDA Form"),
with such modifications as the Counterparty and BofA will in good faith
agree. Upon the execution of such an agreement, this Confirmation will
supplement, form a part of, and be subject to, that agreement. All
provisions contained or incorporated by reference in that agreement upon its
execution will govern this Confirmation except as expressly modified below.
Until the parties execute and deliver that agreement, this Confirmation,
together with all other documents relating to the ISDA Form (each a
"Confirmation") confirming transactions (each a "Transaction") entered into
between us (notwithstanding anything to the contrary in a Confirmation),
shall supplement, form a part of, and be subject to an agreement in the form
of the ISDA Form as if we had executed an agreement in such form (but without
any Schedule) on the Trade Date of the first such Transaction between us
(such agreement, or the ISDA Form, hereinafter the "Agreement"). In the
event of any inconsistency between the provisions of the agreement and this
Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
1
2. The terms of the particular Transaction to which this Confirmation
relates are as follows:
General Terms
Trade Date: October 25, 1999
Option Style: European
Option Type: Put
Seller: Counterparty
Buyer: BofA
Shares: The common stock of BJ Services
Company (the "Issuer") (Exchange
symbol "BJS")
Number of Options: 1,078,000
Option Entitlement: One Share per Option
Strike Price: U.S. $37.0091
Premium: U.S. $2,312,310.00
Premium Payment Date: October 27, 1999
Exchange(s): New York Stock Exchange
Related Exchange(s): The principal exchange(s) for options
contracts or futures contracts, if
any, with respect to the Shares
Procedure for Exercise:
Expiration Time: At the close of trading on the
Exchange
Expiration Date: April 19, 2000
In-the-Money: That the Reference Price is less than
the Strike Price
Automatic Exercise: Applicable
Valuation Date: The Expiration Date
Valuation Time The Expiration Time
For the avoidance of doubt, the first two lines of Section 4.3(a) of the
Equity Definitions are amended to read: 'Section 4.3 Market Disruption
Event. (a) "Market Disruption Event" in relation to a Physically-
settled Option Transaction" means:'
Reference Price: The closing price per Share on the
Exchange at the Valuation Time on the
Valuation Date
2
Seller's Telephone
Number and Facsimile Number Vice President - Treasury
and Contact Details for Purpose Telephone. 000-000-0000
of Giving Notice: Facsimile: 000-000-0000
Settlement Terms:
Physical Settlement: Applicable
Failure to Deliver: Applicable
Adjustments:
Method of Adjustment: Calculation Agent Adjustment
Extraordinary Events:
Consequences of Merger Events
(a) Share-for-Share: Alternative Obligation
(b) Share-for-Other: Cancellation and Payment
(c) Share-for-Combined: Cancellation and Payment
Nationalization or Insolvency: Negotiated Close-out
3. Calculation Agent: BofA
4. Accounts Details:
Payments to BofA:
Pay to: Bank of America, N.A.
F/A/O: Equity Derivatives - Bank
Account No. : 0659795652
Routing No. : 000000000
Payments to Counterparty:
Please provide to expedite payment.
5. Offices:
(a) The Office of BofA for the Transaction is: Charlotte
Address and phone numbers for Notices:
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
(b) The Office of the Counterparty for the Transaction is: Inapplicable.
Counterparty is not a Multibranch Party.
3
Address and phone numbers for Notices:
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
6. Other Provisions
(a) NON-RELIANCE. It is acting for its own account, and it has made
its own independent decision to enter into this Transaction and as
to whether this Transaction is appropriate or proper for it based
upon its own judgement and upon advice from such advisors as it
has deemed necessary. It is not relying on any communication
(written or oral) of the other party as investment advice or as a
recommendation to enter into this Transaction; it being understood
that information and explanations related to the terms and
conditions of this Transaction shall not be considered investment
advice or a recommendation to enter into this Transaction. It has
not received from the other party any assurance or guarantee as to
the expected results of this Transaction.
(b) DESIGNATION BY BOFA. Notwithstanding any other provision in this
Confirmation to the contrary requiring or allowing BofA to
purchase, sell, receive or deliver any shares or other securities
to or from the Counterparty, BofA may designate any of its
affiliates to purchase, sell, receive or deliver such shares or
other securities and otherwise to perform BofA obligations in
respect of this Transaction and any such designee may assume such
obligations. BofA shall be discharged of its obligations to the
Counterparty to the extent of any such performance.
(c) RISK MANAGEMENT. It has entered into this Transaction for the
purpose of managing its borrowings or investments, hedging its
underlying assets or liabilities or in connection with its line of
business.
(d) EVALUATION AND UNDERSTANDING. It is capable of evaluating and
understanding (on its own behalf or through independent
professional advice), and understands and accepts, the terms,
conditions and risks of this Transaction. It is also capable of
assuming, and assumes, the financial and other risks of this
Transaction.
(e) STATUS OF PARTIES. The other party is not acting as a fiduciary or
an advisor for it in respect of this Transaction.
(f) NO INFORMATION. The Counterparty represents and warrants that it
and its affiliates are not entering into the Transaction on the
basis of any material non-public information with respect to the
Shares.
(g) PRIVATE PLACEMENT. Each of Counterparty and BofA represents that
it (A) is an "accredited investor" within the meaning of Rule
501(a) under the Securities Act of 1933 (the "Securities Act"),
(B) is acquiring the instruments described in the Transaction for
its own account, and not with a view to distribution and (C)
understands and acknowledges that the Transaction has not and will
not be registered under the Securities Act.
(h) PAYMENTS UPON CERTAIN EXTRAORDINARY EVENTS. Section 9.7(b)(i) of
the Equity Definitions is amended by deleting the words "two-year"
in the second line and replacing them with the words "180 calendar
day".
(i) CONDITIONS OF EFFECTIVENESS. If the purchase of the First Tranche
Shares (as defined in the Purchase Agreement dated October 25,
1999 between BofA and the Counterparty) is not successfully
closed, then this Transaction shall be of no effect and no
financial compensation shall be due either party.
4
Please confirm your acceptance and agreement with the foregoing by
immediately executing the copy of this Confirmation enclosed for that purpose
and returning it to Bank of America, N.A. by facsimile at 000-000-0000.
Very truly yours,
BANK OF AMERICA, N.A.
By: /s/ Xxxxxxx Xxxxxxxxx
----------------------------
Authorized Signatory
Name: Xxxxxxx Xxxxxxxxx
Confirmed
as of the date first above written:
BJ SERVICES COMPANY
By: /s/ X. X. Xxxxxxxx
------------------------
Authorized Signatory
Name: X. X. Xxxxxxxx
5
October 27, 1999
To: BJ Services Company
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
From: Bank of America, N.A.
Equity Financial Products
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Re: Issuer Share Option Transaction
Reference: NY-2968
The purpose of this letter agreement is to confirm the terms and
conditions of the Transaction entered into between BANK OF AMERICA, N.A.,
("BofA") and BJ SERVICES COMPANY ("Counterparty") on the Trade Date specified
below (the "Transaction"). This letter agreement constitutes a
"Confirmation" as referred to in the ISDA Master Agreement specified below.
The definitions and provisions contained in the 1996 ISDA Equity
Derivatives Definitions (the "Equity Definitions"), as published by the
International Swaps and Derivatives Association, Inc., are incorporated into
this Confirmation. In the event of any inconsistency between the Equity
Definitions and this Confirmation, this Confirmation shall govern. This
Confirmation evidences a complete binding agreement between the Counterparty
and BofA as to the terms of the Transaction to which this Confirmation
relates.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in, or refrained from engaging in, substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Transaction to which this Confirmation relates on
the terms and conditions set forth below.
1. If the Counterparty and BofA have entered into an ISDA Master
Agreement (the "Agreement"), then this Confirmation supplements, forms a part
of, and is subject to, that Agreement, as amended and supplemented from time
to time. All provisions contained in the Agreement govern this Confirmation
except as expressly modified below. If the Counterparty and BofA have not
entered into an ISDA Master Agreement, then they agree to use all reasonable
efforts to promptly negotiate, execute and deliver an agreement in the form
of the ISDA Master Agreement (Multicurrency-Cross Border) (the "ISDA Form"),
with such modifications as the Counterparty and BofA will in good faith
agree. Upon the execution of such an agreement, this Confirmation will
supplement, form a part of, and be subject to, that agreement. All
provisions contained or incorporated by reference in that agreement upon its
execution will govern this Confirmation except as expressly modified below.
Until the parties execute and deliver that agreement, this Confirmation,
together with all other documents relating to the ISDA Form (each a
"Confirmation") confirming transactions (each a "Transaction") entered into
between us (notwithstanding anything to the contrary in a Confirmation),
shall supplement, form a part of, and be subject to an agreement in the form
of the ISDA Form as if we had executed an agreement in such form (but without
any Schedule) on the Trade Date of the first such Transaction between us
(such agreement, or the ISDA Form, hereinafter the "Agreement"). In the
event of any inconsistency between the provisions of the agreement and this
Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
2. The terms of the particular Transactions to which this
Confirmation relates are as follows:
General Terms:
1
Trade Date: October 25, 1999
Option Style: European
Option Type: Put
Seller: Counterparty
Buyer: BofA
Shares: The common stock of BJ Services Company (the
"Issuer") (Exchange symbol "BJS")
Number of Options: 425,000
Option Entitlement: One Share per Option
Multiple Exercise: Inapplicable
Strike Price: U.S. $28.5132 per Share
Premium: For valuable consideration in connection with
the Options Transactions and the Purchase
Agreement entered into on October 25, 1999
Premium Payment Date: Not Applicable
Exchange: The New York Stock Exchange
Related Exchange(s): Any exchange on which options contracts or
futures contracts, if any, relating to the
Shares are traded.
Procedure for Exercise:
Exercise Date: The Expiration Date, if on such date an Option
is or is deemed to be exercised, unless there
is a Market Disruption Event on that Date. If
there is a Market Disruption Event on that
day, then the Exercise Date shall be the first
succeeding Exchange Business Day on which
there is no Market Disruption Event, unless
there is a Market Disruption Event on each of
the five Exchange Business Days immediately
following the original date that, but for the
Market Disruption Event, would have been the
Exercise Date. In that case, (a) that fifth
Exchange Business Day shall be deemed to be
the Exercise Date, notwithstanding the Market
Disruption Event, and (b) the Calculation
Agent shall determine the Reference Price on
the basis of its good faith estimate of the
trading value for the relevant Shares.
Expiration Time: The Valuation Time
Expiration Date: April 25, 2000
Automatic Exercise: Applicable; provided, however, that if Cash
Settlement or Net Share Settlement is
applicable, each Option not previously
exercised will be deemed automatically
exercised at the Expiration Time on the
Exercise Date, unless BofA notifies
Counterparty (by phone or in
2
writing) prior to the Expiration Time on the
Expiration Date that it does not wish Automatic
Exercise to occur, and if Physical Settlement
is applicable, "In-the-Money" shall mean that
the Strike Price exceeds the Reference Price.
Reference Price: The closing price per Share on the Exchange
at the Valuation Time on the Valuation Date
Valuation Time: The close of trading on the Exchange
Valuation Date: The Exercise Date
For the avoidance of doubt, the first two lines of Section 4.3(a) of the
Equity Definitions are amended to read: 'Section 4.3 Market Disruption Event.
(a) "Market Disruption Event" in relation to a Cash-settled Option
Transaction or Physically-settled Option Transaction" means:'
Settlement Terms:
Settlement: Physical Settlement; provided, however, that
the Counterparty may elect the method of
settlement to be Cash Settlement, subject to
the Additional Terms set forth in Section 3(a)
herein, or Net Share Settlement, subject to
the Additional Terms set forth in Section 3(b)
herein; and provided further, that in the
event that the Counterparty is prohibited on
the Exercise Date from purchasing Shares
pursuant to applicable law, then Cash
Settlement shall be deemed applicable and
Counterparty agrees to notify BofA in writing
of such prohibition (which notice shall be
irrevocable) not later than 12:00 p.m. (New
York time) on the Exercise Date.
PHYSICAL SETTLEMENT Applicable, subject to Additional Terms set
TERMS: forth in Section 3(b) herein.
Failure to Deliver: Applicable
3. Additional Terms:
(a) Option to Cash Counterparty shall have the right, but not the
Settle: obligation, to cash settle the Transaction.
If Counterparty elects such right,
Counterparty will execute and deliver written
notice specifying that Cash Settlement applies
to the Transaction on any Currency Business
Day that is at least three Currency Business
Days prior to the Expiration Date. Once Cash
Settlement is elected with respect to a
Transaction, such election shall be
irrevocable.
CASH SETTLEMENT TERMS:
Cash Settlement: If Cash Settlement is applicable, Seller shall
pay to Buyer the Cash Settlement Amount, if
any, on the Cash Settlement Payment Date for
all Options exercised or deemed exercised.
Cash Settlement Amount: An amount, as calculated by the Calculation
Agent, equal to the number of Options
exercised on the Exercise Date multiplied by
the Option Entitlement multiplied by the
Strike Price Differential.
3
Cash Settlement Three Currency Business Days after the
Payment Date: Valuation Date.
Strike Price An amount equal to the greater of the (i)
Differential: excess of the Strike Price over the Reference
Price and (ii) zero
(b) Option to Net Counterparty shall have the right, but not the
Share Settle: obligation, to net share settle the
Transaction. If Counterparty elects such
right, Counterparty will execute and deliver
written notice specifying that Net Share
Settlement applies to the Transaction on any
Currency Business Day that is at least fifteen
(15) Currency Business Days prior to the
Expiration Date. Once Net Share Settlement is
elected with respect to a Transaction, such
election shall be irrevocable
MANDATORY PHYSICAL If the Options are exercised and if the
SETTLEMENT Counterparty shall have elected Cash
Settlement or Net Share Settlement in
accordance with the terms hereof, and any of
the conditions of the Registration Rights
Agreement and Shelf Registration provision
hereof regarding registration have not been
met on or prior to the dates specified herein,
Counterparty shall have the obligation to
settle the Transaction by Physical Settlement.
Registration Rights If this Transaction is settled in accordance
Agreement and Shelf with Section 3(b) hereof, the following
Registration: conditions must be met:
(1) Counterparty will enter into a
Registration Rights Agreement with BofA
in form and acceptance satisfactory to
BofA not later than the third Exchange
Business Day after such election, which
agreement will contain among other
things, customary representations and
warranties and indemnification and other
rights relating to the registration of
the Shares to be delivered pursuant to
Net Share Settlement;
(ii) Counterparty shall have made available to
BofA for inspection all financial and
other records, pertinent corporate
documents, or other information
reasonably requested by BofA in
connection with such Registration
Statement and BofA shall be satisfied
in all material respects with the results
of such due diligence investigation of
Counterparty;
(iii) The Shelf Registration (as hereinafter
defined) shall have been declared
effective by the Securities Exchange
Commission not less than three (3)
Exchange Business Days prior to the
Expiration Date; and
(iv) Counterparty shall maintain the
effectiveness of the Shelf Registration
until all Shares delivered pursuant to
Net Share Settlement have been sold by
BofA.
If any of the foregoing conditions regarding
registration have not been met on or prior to
the dates specified above, Physical Settlement
shall apply for this Transaction. In
addition, if the Shelf Registration has been
declared effective, but it does not remain
effective until all shares delivered pursuant
to Net Share Settlement have been sold by BofA,
BofA shall have the right to require that
Counterparty repurchase any unsold Shares at a
price per share equal to the Reference Price.
"Shelf Registration" means a registration
statement in form and substance reasonably
satisfactory to BofA for an offering to be
made on a continuous basis pursuant to Rule
415 under the Securities Act of 1933, as
amended, registering BofA's resale of not
less than all the Shares delivered pursuant to
Net Share
4
Settlement, in the manner or manners designated
by BofA.
Make-whole Amount: If this Transaction is settled in accordance
with Section 3(b) hereof, the following shall
apply:
(i) If within ten (10) Exchange Business Days
after the Settlement Date, BofA resells
all or any portion of the Shares
delivered to BofA in payment pursuant to
Net Share Settlement and the net proceeds
received by BofA upon resale of such
Shares exceed the Net Share Settlement
Amount (or if less than all of the Shares
are resold, the applicable pro rata
portion of the Net Share Settlement
Amount), BofA shall promptly refund in
cash such difference to the Counterparty.
(ii) In the event that such net proceeds
received by BofA are less than the Net
Share Settlement Amount (or if less than
all of the Shares are resold, the
applicable pro rata portion of the Net
Settlement Amount), Counterparty shall
pay in cash such difference (the "Make-
whole Amount") to BofA promptly after
receipt of notice thereof.
NET SHARE SETTLEMENT
TERMS:
Net Share Settlement: If Net Share Settlement is applicable,
Counterparty shall deliver to BofA the Share
Delivery Quantity on the Settlement Date (as
such term is defined in Section 6.2 in the
Equity Definitions) at the account specified
hereto free of payment through the Clearance
System.
Share Delivery A number of Shares, as calculated by the
Quantity: Calculation Agent, equal to the Net Share
Settlement Amount divided by the Reference
Price, plus cash in lieu of any fractional
shares, provided that if the Reference Price
is greater than or equal to the Strike Price,
no Shares shall be so deliverable.
Net Share Settlement The product of (i) the Number of Options
Amount: multiplied by (ii) the Option Entitlement
multiplied by (iii) the Strike Price
Differential.
Failure to Deliver: Applicable
Adjustments:
Method of Adjustment: Calculation Agent Adjustment
Extraordinary Events:
Consequences of Merger
Events:
(a) Share-for-Share: Alternative Obligation
(b) Share-for-Other: Cancellation and Payment
(c) Share-for- Cancellation and Payment
Combined:
Nationalization or Insolvency: Cancellation and Payment
5
4. Calculation Agent: BofA
5. Account Details:
(a) Account for Pay to :
payments to FBA:
Counterparty: Further A/C #:
Account for delivery of Please Advise
Shares to Counterparty:
(b) Account for FedWire to:
payments to BofA: Bank of America, N.A. - Charlotte, NC
Account #: 0659795652
ABA #: 000-000-000
For account of Equity Derivatives - Bank
7. Offices:
The Office of Counterparty for the Transaction is: Inapplicable,
Counterparty is not a Multibranch Party.
The Office of BofA for the Transaction is: Charlotte.
8. Other Provisions:
(a) NON-RELIANCE. It is acting for its own account, and it has made
its own independent decision to enter into this Transaction and
as to whether this Transaction is appropriate or proper for it
based upon its own judgement and upon advice from such advisors
as it has deemed necessary. It is not relying on any
communication (written or oral) of the other party as investment
advice or as a recommendation to enter into this Transaction; it
being understood that information and explanations related to
the terms and conditions of this Transaction shall not be
considered investment advice or a recommendation to enter into
this Transaction. It has not received from the other party any
assurance or guarantee as to the expected results of this
Transaction.
(b) DESIGNATION BY BOFA. Notwithstanding any other provision in this
Confirmation to the contrary requiring or allowing BofA to
purchase, sell, receive or deliver any shares or other
securities to or from the Counterparty, BofA may designate any
of its affiliates to purchase, sell, receive or deliver such
shares or other securities and otherwise to perform BofA
obligations in respect of this Transaction and any such designee
may assume such obligations. BofA shall be discharged of its
obligations to the Counterparty to the extent of any such
performance.
(c) RISK MANAGEMENT. It has entered into this Transaction for the
purpose of managing its borrowings or investments, hedging its
underlying assets or liabilities or in connection with its line
of business.
(d) EVALUATION AND UNDERSTANDING. It is capable of evaluating and
understanding (on its own behalf or through independent
professional advice), and understands and accepts, the terms,
conditions and risks of this Transaction. It is also capable of
assuming, and assumes, the financial and other risks of this
Transaction.
(e) STATUS OF PARTIES. The other party is not acting as a fiduciary
or an advisor for it in respect of this Transaction.
(f) NO INFORMATION. The Counterparty represents and warrants that
it and its affiliates are not entering into the Transaction on
the basis of any material non-public information with respect to
the Shares.
(g) NO PROHIBITION. The Counterparty represents that it could have
purchased Shares, in an amount equal to the product of 45% of
the Number of Options and the Option Entitlement, on the
Exchange or
6
otherwise, in compliance with applicable law and any contractual
agreements binding upon Counterparty, on the Trade Date.
(h) PRIVATE PLACEMENT. Each of Counterparty and BofA represents that
it (A) is an accredited investor within the meaning of Rule
501(a) under the Securities Act of 1933 (the Securities Act ),
(B) is acquiring the instruments described in the Transaction
for its own account, and not with a view to distribution and (C)
understands and acknowledges that the Transaction has not and
will not be registered under the Securities Act.
(i) CONSISTENT WITH PUBLIC DISCLOSURES. The Counterparty represents
that any Shares acquired pursuant to the Transaction will be
made in connection with the Counterparty s Share repurchase
program, which was approved by its board of directors and
publicly announced, solely for the purposes stated in such board
resolution and public disclosure.
9. Notices: For purposes of this Confirmation::
(a) Address for notices or communications to Counterparty:
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
(b) Address for notices or communications to BofA :
Bank of America, N.A.
Equity Financial Products
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
7
Please confirm your agreement to be bound by the terms stated herein by
executing the copy of this Confirmation enclosed for that purpose and
returning it to us by mail or facsimile transmission to the address for
Notices indicated above.
Yours sincerely,
BANK OF AMERICA, N.A.
By: /s/ Xxxxxxx Xxxxxxxxx
------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Managing Director
Confirmed as of the date first above written:
BJ SERVICES COMPANY
By: /s/ X. X. Xxxxxxxx
------------------------------
Name: X. X. Xxxxxxxx
Title: Vice President and Treasurer
8
October 27, 1999
To: BJ Services Company
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
From: Bank of America, N.A.
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
Re: Share Option Transaction
Reference: NY-2967C
The purpose of this letter agreement is to confirm the terms and
conditions of the Transaction entered into between BANK OF AMERICA, N.A.,
("BofA") and BJ SERVICES COMPANY ("Counterparty") on the Trade Date specified
below (the "Transaction"). This letter agreement constitutes a
"Confirmation" as referred to in the ISDA Master Agreement specified below.
The definitions and provisions contained in the 1996 ISDA Equity
Derivatives Definitions (the "Equity Definitions"), as published by the
International Swaps and Derivatives Association, Inc., are incorporated into
this Confirmation. In the event of any inconsistency between the Equity
Definitions and this Confirmation, this Confirmation shall govern. This
Confirmation evidences a complete binding agreement between the Counterparty
and BofA as to the terms of the Transaction to which this Confirmation
relates.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in, or refrained from engaging in, substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Transaction to which this Confirmation relates on
the terms and conditions set forth below.
1. If the Counterparty and BofA have entered into an ISDA Master
Agreement (the "Agreement"), then this Confirmation supplements, forms a part
of, and is subject to, that Agreement, as amended and supplemented from time
to time. All provisions contained in the Agreement govern this Confirmation
except as expressly modified below. If the Counterparty and BofA have not
entered into an ISDA Master Agreement, then they agree to use all reasonable
efforts to promptly negotiate, execute and deliver an agreement in the form
of the ISDA Master Agreement (Multicurrency-Cross Border) (the "ISDA Form"),
with such modifications as the Counterparty and BofA will in good faith
agree. Upon the execution of such an agreement, this Confirmation will
supplement, form a part of, and be subject to, that agreement. All
provisions contained or incorporated by reference in that agreement upon its
execution will govern this Confirmation except as expressly modified below.
Until the parties execute and deliver that agreement, this Confirmation,
together with all other documents relating to the ISDA Form (each a
"Confirmation") confirming transactions (each a "Transaction") entered into
between us (notwithstanding anything to the contrary in a Confirmation),
shall supplement, form a part of, and be subject to an agreement in the form
of the ISDA Form as if we had executed an agreement in such form (but without
any Schedule) on the Trade Date of the first such Transaction between us
(such agreement, or the ISDA Form, hereinafter the "Agreement"). In the
event of any inconsistency between the provisions of the agreement and this
Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
1
2. The terms of the particular Transaction to which this Confirmation
relates are as follows:
General Terms
Trade Date: October 25, 1999
Option Style: European
Option Type: Call
Seller: BofA
Buyer: Counterparty
Shares: The common stock of BJ Services
Company (the "Issuer") (Exchange
symbol "BJS")
Number of Options: 2,949,972
Option Entitlement: One Share per Option
Strike Price: U.S. $36.9741
Premium: U.S. $3,163,844.97
Premium Payment Date: October 28, 1999
Exchange(s): New York Stock Exchange
Related Exchange(s): The principal exchange(s) for options
contracts or futures contracts, if
any, with respect to the Shares
Procedure for Exercise:
Expiration Time: At the close of trading on the
Exchange
Expiration Date: April 17, 2000
In-the-Money: That the Reference price is greater
than the Strike Price
Automatic Exercise: Applicable
Valuation Date: The Expiration Date
For the avoidance of doubt, the first two lines of Section 4.3(a) of the
Equity Definitions are amended to read: 'Section 4.3 Market Disruption
Event. (a) "Market Disruption Event" in relation to a
Physically-settled Option Transaction" means:'
Reference Price: The closing price per Share on the
Exchange at the Valuation Time on the
Valuation Date
2
Seller's Telephone
Number and Facsimile Number
and Contact Details for Purpose Telephone No.: 000-000-0000
of Giving Notice: Telecopy No.: 000-000-0000
Settlement Terms:
Physical Settlement: Applicable
Failure to Deliver: Applicable
Adjustments:
Method of Adjustment: Calculation Agent Adjustment
Extraordinary Events:
Consequences of Merger Events
(a) Share-for-Share: Alternative Obligation
(b) Share-for-Other: Cancellation and Payment
(c) Share-for-Combined: Cancellation and Payment
Nationalization or Insolvency: Negotiated Close-out
3. Calculation Agent: BofA
4. Accounts Details:
Payments to BofA:
Pay to: Bank of America, N.A.
F/A/O: Equity Derivatives - Bank
Account No. : 0659795652
Routing No. : 000000000
Payments to Counterparty:
Please provide to expedite payment.
5. Offices:
(a) The Office of BofA for the Transaction is: Charlotte
Address and phone numbers for Notices:
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
3
(b) The Office of the Counterparty for the Transaction is:
Inapplicable. Counterparty is not a Multibranch Party.
Address and phone numbers for Notices:
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
6. Other Provisions
(a) NON-RELIANCE. It is acting for its own account, and it has made
its own independent decision to enter into this Transaction and as
to whether this Transaction is appropriate or proper for it based
upon its own judgement and upon advice from such advisors as it
has deemed necessary. It is not relying on any communication
(written or oral) of the other party as investment advice or as a
recommendation to enter into this Transaction; it being understood
that information and explanations related to the terms and
conditions of this Transaction shall not be considered investment
advice or a recommendation to enter into this Transaction. It has
not received from the other party any assurance or guarantee as to
the expected results of this Transaction.
(b) DESIGNATION BY BOFA. Notwithstanding any other provision in this
Confirmation to the contrary requiring or allowing BofA to
purchase, sell, receive or deliver any shares or other securities
to or from the Counterparty, BofA may designate any of its
affiliates to purchase, sell, receive or deliver such shares or
other securities and otherwise to perform BofA obligations in
respect of this Transaction and any such designee may assume such
obligations. BofA shall be discharged of its obligations to the
Counterparty to the extent of any such performance.
(c) RISK MANAGEMENT. It has entered into this Transaction for the
purpose of managing its borrowings or investments, hedging its
underlying assets or liabilities or in connection with its line of
business.
(d) EVALUATION AND UNDERSTANDING. It is capable of evaluating and
understanding (on its own behalf or through independent
professional advice), and understands and accepts, the terms,
conditions and risks of this Transaction. It is also capable of
assuming, and assumes, the financial and other risks of this
Transaction.
(e) STATUS OF PARTIES. The other party is not acting as a fiduciary or
an advisor for it in respect of this Transaction.
(f) NO INFORMATION. The Counterparty represents and warrants that it
and its affiliates are not entering into the Transaction on the
basis of any material non-public information with respect to the
Shares.
(g) PRIVATE PLACEMENT. Each of Counterparty and BofA represents that
it (A) is an "accredited investor" within the meaning of Rule
501(a) under the Securities Act of 1933 (the "Securities Act"),
(B) is acquiring the instruments described in the Transaction for
its own account, and not with a view to distribution and (C)
understands and acknowledges that the Transaction has not and will
not be registered under the Securities Act.
(h) PAYMENTS UPON CERTAIN EXTRAORDINARY EVENTS. Section 9.7(b)(i) of
the Equity Definitions is amended by deleting the words "two-year"
in the second line and replacing them with the words "180 calendar
day".
(i) CONDITIONS OF EFFECTIVENESS. If the purchase of the Second Tranche
Shares (as defined in the Purchase Agreement dated October 25,
1999 between BofA and the Counterparty) is not successfully
closed, then this Transaction shall be of no effect and no
financial compensation shall be due either party.
4
Please confirm your acceptance and agreement with the foregoing by
immediately executing the copy of this Confirmation enclosed for that purpose
and returning it to Bank of America, N.A. by facsimile at 000-000-0000.
Very truly yours,
BANK OF AMERICA, N.A.
By: /s/ Xxxxxxx Xxxxxxxxx
-----------------------------
Authorized Signatory
Name: Xxxxxxx Xxxxxxxxx
Confirmed
as of the date first above written:
BJ SERVICES COMPANY
By: /s/ X. X. Xxxxxxxx
----------------------------
Authorized Signatory
Name: X. X. Xxxxxxxx
6
October 27, 1999
To: BJ Services Company
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
From: Bank of America, N.A.
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone 000-000-0000
Facsimile: 000-000-0000
Re: Share Option Transaction
Reference: NY-2967P
The purpose of this letter agreement is to confirm the terms and
conditions of the Transaction entered into between BANK OF AMERICA, N.A.,
("BofA") and BJ SERVICES COMPANY ("Counterparty") on the Trade Date specified
below (the "Transaction"). This letter agreement constitutes a
"Confirmation" as referred to in the ISDA Master Agreement specified below.
The definitions and provisions contained in the 1996 ISDA Equity
Derivatives Definitions (the "Equity Definitions"), as published by the
International Swaps and Derivatives Association, Inc., are incorporated into
this Confirmation. In the event of any inconsistency between the Equity
Definitions and this Confirmation, this Confirmation shall govern. This
Confirmation evidences a complete binding agreement between the Counterparty
and BofA as to the terms of the Transaction to which this Confirmation
relates.
Each party is hereby advised, and each such party acknowledges, that
the other party has engaged in, or refrained from engaging in, substantial
financial transactions and has taken other material actions in reliance upon
the parties' entry into the Transaction to which this Confirmation relates on
the terms and conditions set forth below.
1. If the Counterparty and BofA have entered into an ISDA Master
Agreement (the "Agreement"), then this Confirmation supplements, forms a part
of, and is subject to, that Agreement, as amended and supplemented from time
to time. All provisions contained in the Agreement govern this Confirmation
except as expressly modified below. If the Counterparty and BofA have not
entered into an ISDA Master Agreement, then they agree to use all reasonable
efforts to promptly negotiate, execute and deliver an agreement in the form
of the ISDA Master Agreement (Multicurrency-Cross Border) (the "ISDA Form"),
with such modifications as the Counterparty and BofA will in good faith
agree. Upon the execution of such an agreement, this Confirmation will
supplement, form a part of, and be subject to, that agreement. All
provisions contained or incorporated by reference in that agreement upon its
execution will govern this Confirmation except as expressly modified below.
Until the parties execute and deliver that agreement, this Confirmation,
together with all other documents relating to the ISDA Form (each a
"Confirmation") confirming transactions (each a "Transaction") entered into
between us (notwithstanding anything to the contrary in a Confirmation),
shall supplement, form a part of, and be subject to an agreement in the form
of the ISDA Form as if we had executed an agreement in such form (but without
any Schedule) on the Trade Date of the first such Transaction between us
(such agreement, or the ISDA Form, hereinafter the "Agreement"). In the
event of any inconsistency between the provisions of the agreement and this
Confirmation, this Confirmation will prevail for the purpose of this
Transaction.
1
2. The terms of the particular Transaction to which this Confirmation
relates are as follows:
General Terms
Trade Date: October 25, 1999
Option Style: European
Option Type: Put
Seller: Counterparty
Buyer: BofA
Shares: The common stock of BJ Services
Company (the "Issuer") (Exchange
symbol "BJS")
Number of Options: 2,949,972
Option Entitlement: One Share per Option
Strike Price: U.S. $36.9741
Premium: U.S. $6,327,689.94
Premium Payment Date: October 28, 1999
Exchange(s): New York Stock Exchange
Related Exchange(s): The principal exchange(s) for options
contracts or futures contracts, if
any, with respect to the Shares
Procedure for Exercise:
Expiration Time: At the close of trading on the
Exchange
Expiration Date: April 17, 2000
In-the-Money: That the Reference Price is less than
the Strike Price
Automatic Exercise: Applicable
Valuation Date: The Expiration Date
Valuation Time The Expiration Time
For the avoidance of doubt, the first two lines of Section 4.3(a) of the
Equity Definitions are amended to read: 'Section 4.3 Market Disruption
Event. (a) "Market Disruption Event" in relation to a
Physically-settled Option Transaction" means:'
Reference Price: The closing price per Share on the
Exchange at the Valuation Time on the
Valuation Date
Seller's Telephone
Number and Facsimile Number Attention: Vice President - Treasury
2
and Contact Details for Purpose Telephone. 000-000-0000
of Giving Notice: Facsimile: 000-000-0000
Settlement Terms:
Physical Settlement: Applicable
Failure to Deliver: Applicable
Adjustments:
Method of Adjustment: Calculation Agent Adjustment
Extraordinary Events:
Consequences of Merger Events
(a) Share-for-Share: Alternative Obligation
(b) Share-for-Other: Cancellation and Payment
(c) Share-for-Combined: Cancellation and Payment
Nationalization or Insolvency: Negotiated Close-out
3. Calculation Agent: BofA
4. Accounts Details:
Payments to BofA:
Pay to: Bank of America, N.A.
F/A/O: Equity Derivatives - Bank
Account No. : 0659795652
Routing No. : 000000000
Payments to Counterparty:
Please provide to expedite payment.
5. Offices:
(a) The Office of BofA for the Transaction is: Charlotte
Address and phone numbers for Notices:
c/o Banc of America Securities LLC
0 Xxxx 00xx Xxxxxx, 00xx xxxxx
Xxx Xxxx, XX 00000
Telephone: 000-000-0000
Facsimile: 000-000-0000
(b) The Office of the Counterparty for the Transaction is:
Inapplicable. Counterparty is not a Multibranch Party.
Address and phone numbers for Notices:
0000 Xxxxxxxxx Xxxxxxx Xxxxx
Xxxxxxx, XX 00000
3
Attn. Vice President - Treasury
Telephone: 000-000-0000
Facsimile: 000-000-0000
6. Other Provisions
(a) NON-RELIANCE. It is acting for its own account, and it has made
its own independent decision to enter into this Transaction and as
to whether this Transaction is appropriate or proper for it based
upon its own judgement and upon advice from such advisors as it
has deemed necessary. It is not relying on any communication
(written or oral) of the other party as investment advice or as a
recommendation to enter into this Transaction; it being understood
that information and explanations related to the terms and
conditions of this Transaction shall not be considered investment
advice or a recommendation to enter into this Transaction. It has
not received from the other party any assurance or guarantee as to
the expected results of this Transaction.
(b) DESIGNATION BY BOFA. Notwithstanding any other provision in this
Confirmation to the contrary requiring or allowing BofA to
purchase, sell, receive or deliver any shares or other securities
to or from the Counterparty, BofA may designate any of its
affiliates to purchase, sell, receive or deliver such shares or
other securities and otherwise to perform BofA obligations in
respect of this Transaction and any such designee may assume such
obligations. BofA shall be discharged of its obligations to the
Counterparty to the extent of any such performance.
(c) RISK MANAGEMENT. It has entered into this Transaction for the
purpose of managing its borrowings or investments, hedging its
underlying assets or liabilities or in connection with its line of
business.
(d) EVALUATION AND UNDERSTANDING. It is capable of evaluating and
understanding (on its own behalf or through independent
professional advice), and understands and accepts, the terms,
conditions and risks of this Transaction. It is also capable of
assuming, and assumes, the financial and other risks of this
Transaction.
(e) STATUS OF PARTIES. The other party is not acting as a fiduciary or
an advisor for it in respect of this Transaction.
(f) NO INFORMATION. The Counterparty represents and warrants that it
and its affiliates are not entering into the Transaction on the
basis of any material non-public information with respect to the
Shares.
(g) PRIVATE PLACEMENT. Each of Counterparty and BofA represents that
it (A) is an "accredited investor" within the meaning of Rule
501(a) under the Securities Act of 1933 (the "Securities Act"),
(B) is acquiring the instruments described in the Transaction for
its own account, and not with a view to distribution and (C)
understands and acknowledges that the Transaction has not and will
not be registered under the Securities Act.
(h) PAYMENTS UPON CERTAIN EXTRAORDINARY EVENTS. Section 9.7(b)(i) of
the Equity Definitions is amended by deleting the words "two-year"
in the second line and replacing them with the words "180 calendar
day".
(i) CONDITIONS OF EFFECTIVENESS. If the purchase of the Second Tranche
Shares (as defined in the Purchase Agreement dated October 25,
1999 between BofA and the Counterparty) is not successfully
closed, then this Transaction shall be of no effect and no
financial compensation shall be due either party.
4
Please confirm your acceptance and agreement with the foregoing by
immediately executing the copy of this Confirmation enclosed for that purpose
and returning it to Bank of America, N.A. by facsimile at 000-000-0000.
Very truly yours,
BANK OF AMERICA, N.A.
By: /s/ Xxxxxxx Xxxxxxxxx
----------------------------
Authorized Signatory
Name: Xxxxxxx Xxxxxxxxx
Confirmed
as of the date first above written:
BJ SERVICES COMPANY
By: /s/ X. X. Xxxxxxxx
----------------------------
Authorized Signatory
Name: X. X. Xxxxxxxx
5
