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EXHIBIT 10.24
WARRANT
THIS WARRANT (this "Warrant") is made as of September 8, 1998, between
WEATHERFORD INTERNATIONAL, INC., a Delaware corporation ("Weatherford"), and
Robert K. Moses, Jr. (the "Holder").
W I T N E S S E T H:
WHEREAS, Weatherford has granted to the Holder the right to purchase
stock as set forth in this Warrant;
NOW, THEREFORE, in consideration of the premises and the covenants and
agreements herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Weatherford and the
Holder hereby agree as follows:
1. Grant. (a) Weatherford hereby grants to the Holder a warrant
effective on September 8, 1998 (the "Date of Grant") to purchase 60,000 shares
of Weatherford Common Stock, $1.00 par value ("Common Stock") having an exercise
price equal to the closing sale price of the Common Stock on the New York Stock
Exchange, Inc. on September 8, 1998. Weatherford and the Holder agree that the
Warrant shall be subject to the terms of this Warrant. Weatherford and the
Holder further agree that this Warrant sets forth the complete terms of the
Warrant as in effect on the date hereof.
(b) No Warrant shall be exercisable after the expiration of 10 years
from the date the Warrant becomes first exercisable.
(c) Subject to the terms and conditions hereof, this Warrant provides
the Holder with the right to purchase 60,000 shares of Common Stock at a price
of $18.125 per share (the "Warrant Price").
(d) Subject to earlier vesting in the event of (i) a "Change in
Control" as provided in Section 1(g) hereof, or (ii) in the event the Holder
dies, retires or incurs a disability while serving as a director of Weatherford
as provided for in Section 6, the Warrant shall become exercisable following
three years from the date of grant of the Warrant.
(e) Notwithstanding the provisions of Section 1(e) hereof, the Warrant
shall be exercisable with respect to all of the shares subject to this Warrant
upon the occurrence of a Change in Control (as defined herein). For purposes of
this Warrant, a Change in Control shall mean the occurrence of one or more of
the following events: (i) any "person", including a "group", as those terms are
used in Section 13(d)(3) of the Securities Exchange Act of 1934, other than an
affiliate of Weatherford as of the Date of Grant, becomes the beneficial owner,
directly or indirectly, of securities of Weatherford representing 30% or more of
the combined voting power of Weatherford's then outstanding voting securities;
(ii) Weatherford is merged or consolidated with or into another corporation and
immediately after giving effect to the merger or consolidation either (A) less
than 65% of the outstanding voting securities of the surviving or resulting
entity are then beneficially
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owned in the aggregate by (x) the stockholders of Weatherford immediately prior
to such merger or consolidation or (y) if a record date has been set to
determine the stockholders of Weatherford entitled to vote on such merger or
consolidation, the stockholders of Weatherford as of such record date, or (B)
the Board of Directors, or similar governing body, of the surviving or resulting
entity does not have as a majority of its members the persons specified in
clause (iii)(A) and (B) below; (iii) if at any time the following do not
constitute a majority of the Board of Directors of Weatherford (or any successor
entity referred to in clause (ii) above): (A) persons who are directors of
Weatherford on the Date of Grant and (B) persons who, prior to their election as
a director of Weatherford (or successor entity if applicable), were nominated,
recommended or endorsed by a formal resolution of the Board of Directors of
Weatherford; (iv) persons who are directors of Weatherford as of the beginning
of any calendar year cease to constitute a majority of the members of the Board
of Directors at any time during that calendar year; or (v) Weatherford transfers
all or substantially all of its assets as contemplated by Delaware corporate law
on a consolidated basis to another corporation or entity which is a less than a
50% owned subsidiary of Weatherford.
(f) The Holder may exercise this Warrant by delivering to Weatherford a
written notice stating (i) that the Holder wishes to exercise this Warrant on
the date such notice is so delivered, (ii) the number of shares of stock with
respect to which this Warrant is to be exercised, (iii) the address to which the
certificate representing such shares of stock should be mailed, and (iv) the
social security number or the Holder. In order to be effective, such written
notice shall be accompanied by payment of the purchase price of such shares of
stock. Each such payment shall be made by cashier's check drawn on a national
banking association and payable to the order of Weatherford in United States
dollars.
If, at the time of receipt by Weatherford of such written notice, (i)
Weatherford has unrestricted surplus in an amount not less than the Warrant
Price of such shares of stock, (ii) all accrued cumulative preferential
dividends and other current preferential dividends on all outstanding shares of
preferred stock of Weatherford have been fully paid, (iii) the acquisition by
Weatherford of its own shares of stock for the purpose of enabling the Holder to
exercise this Warrant is otherwise permitted by applicable law and without any
vote or consent of any stockholder of Weatherford, and (iv) there shall have
been adopted, and there shall be in full force and effect, a resolution of the
Board of Directors of Weatherford authorizing the acquisition by Weatherford of
its own shares of stock for such purpose, then the Holder may deliver to
Weatherford, in payment of the Warrant Price for the shares of stock with
respect to which this Warrant is exercised, (x) certificates registered in the
name of the Holder that represent a number of shares of stock legally and
beneficially owned by the Holder (free of all liens, claims and encumbrances of
every kind) and having a fair market value on the date of receipt by Weatherford
of such written notice that is not greater than the Warrant Price for the shares
of stock with respect to which this Warrant is to be exercised, such
certificates to be accompanied by stock powers duly endorsed in blank by the
record holder of the shares of stock represented by such certificates, with the
signature of such record holder guaranteed by a national banking association (or
in lieu of such certificates, other arrangements for the transfer of such shares
to Weatherford which are satisfactory to Weatherford), and (y) if the Warrant
Price of the shares of stock with respect to which this Warrant is to be
exercised exceeds such fair market value of the shares used to exercise this
Warrant, a cashier's check drawn on a national banking association and payable
to the order of Weatherford in an amount, in United States dollars, equal to the
amount of such excess. Notwithstanding the provisions of the immediately
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preceding sentence, the Board of Directors, in its sole discretion, may refuse
to accept shares of stock in payment of the Warrant Price for the shares of
stock with respect to which this Warrant is to be exercised and, in that event,
any certificates representing shares of stock that were received by Weatherford
with such written notice shall be returned to the Holder, together with notice
by Weatherford to the Holder of the refusal of the Board of Directors to accept
such shares of stock. If, at the expiration of seven business days after the
delivery to the Holder of such written notice from Weatherford, the Holder shall
not have delivered to Weatherford a cashier's check drawn on a national banking
association and payable to the order of Weatherford in an amount, in United
States dollars, equal to the price for the shares of stock with respect to which
this Warrant is to be exercised, such written notice from the Holder to
Weatherford shall be ineffective to exercise this Warrant.
As promptly as practicable after the receipt by Weatherford of (i) such
written notice from the Holder and (ii) payment, in the form required by the
foregoing provisions of this Section 1(g) of the Warrant Price for the shares of
stock with respect to which this Warrant is to be exercised, a certificate
representing the number of shares of stock with respect to which this Warrant
has been so exercised, such certificate to be registered in the name of the
Holder, provided that such delivery shall be considered to have been made when
such certificate shall have been mailed, postage prepaid, to the Holder at the
address specified for such purpose in such written notice from the Holder to
Weatherford.
2. Changes in Weatherford's Capital Structure. The existence of this
Warrant shall not affect in any way the right or power of Weatherford or its
stockholders to make or authorize any or all adjustments, recapitalizations,
reorganizations or other changes in Weatherford's capital structure or its
business, or any merger or consolidation of Weatherford, or any issue of bonds,
debentures, preferred or prior preference stock ahead of or affecting the Common
Stock or the rights thereof, or the dissolution or liquidation of Weatherford,
or any sale or transfer of all or any part of its assets or business, or any
other corporate act or proceeding, whether of a similar character or otherwise.
If Weatherford shall effect a subdivision or consolidation of shares or
other capital adjustment of, or the payment of a dividend in capital stock or
other equity securities of Weatherford on, its Common Stock, or other increase
or reduction of the number of shares of the Common Stock without receiving
consideration therefor in money, services, or property, or the reclassification
of its Common Stock, in whole or in part, into other equity securities of
Weatherford, then (a) the number, class and per share price of shares of stock
subject to the unexercised portion of this Warrant shall be appropriately
adjusted (or in the case of the issuance of other equity securities as a
dividend on, or in a reclassification of, the Common Stock, this Warrant shall
extend to such other securities) in such a manner as to entitle the Holder to
receive, upon exercise of this Warrant, for the same aggregate cash
consideration, the same total number and class or classes of shares (or in the
case of a dividend of, or reclassification into, other equity securities, such
other securities) the Holder would have held after such adjustment if the Holder
had exercised this Warrant in full immediately prior to the event requiring the
adjustment, or, if applicable, the record date for determining stockholders to
be affected by such adjustment; and (b) the number and class of shares then
reserved for issuance under this Warrant (or in the case of a dividend of, or
reclassification into, other equity securities, such other securities) shall be
adjusted by substituting for the total number and class of
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shares of stock then received, the number and class or classes of shares of
stock (or in the case of a dividend of, or reclassification into, other equity
securities, such other securities) that would have been received by the owner of
an equal number of outstanding shares of Common Stock as a result of the event
requiring the adjustment. Comparable rights shall accrue to the Holder in the
event of successive subdivisions, consolidations, capital adjustments, dividends
or reclassifications of the character described above.
If Weatherford shall distribute to all holders of its shares of Common
Stock (including any such distribution made to non-dissenting stockholders in
connection with a consolidation or merger in which Weatherford is the surviving
corporation and in which holders of shares of Common Stock continue to hold
shares of Common Stock after such merger or consolidation) evidences of
indebtedness or cash or other assets (other than cash dividends payable out of
consolidated retained earnings not in excess of, in any one year period, the
greater of (a) in an amount per share of Common Stock equal to $1.00 per share
of Common Stock (as the same may be adjusted from time to time by the Board of
Directors of Weatherford to reflect the effect of changes in capitalization) and
(b) two times the aggregate amount of dividends per share paid during the
preceding calendar year and dividends or distributions payable in shares of
Common Stock or other equity securities of Weatherford described in the
immediately preceding paragraph, but including stock or other securities of any
corporation or other entity owned by Weatherford), then in each case the Warrant
Price shall be adjusted by reducing the Warrant Price in effect immediately
prior to the record date for the determination of stockholders entitled to
receive such distribution by the fair market value, as determined in good faith
by the Board of Directors of Weatherford (whose determination shall be described
in a statement filed in Weatherford's corporate records and be available for
inspection by any holder of this Warrant) of the portion of the evidence of
indebtedness or cash or other assets so to be distributed applicable to one
share of Common Stock; provided that in no event shall the Warrant Price be less
than the par value of a share of Common Stock. In the event such adjustment
would result in this Warrant Price being less than the par value of a share of
Common Stock but for the foregoing proviso, the terms of this Warrant shall be
appropriately adjusted so as to maintain the economic value of this Warrant,
including through an adjustment to the number of shares of Common Stock then
subject to this Warrant and through a provision allowing the Holder to receive
the evidence of indebtedness or cash or other assets so to be distributed
applicable to one share of Common Stock for each share of Common Stock that may
be purchased on the exercise of this Warrant. Such adjustment shall be made
whenever any such distribution is made, and shall become effective on the date
of the distribution retroactive to the record date for the determination of the
stockholders entitled to receive such distribution. In addition, in the event
Weatherford distributes shares or other securities of a subsidiary corporation
or other entity to the holders of the Common Stock, the Board of Directors may,
in lieu of the adjustment provided above, make provision allowing the Holder to
receive the shares or securities of the corporation or entity that are subject
to the distribution. Comparable adjustments shall be made in the event of
successive distributions of the character described above.
If Weatherford shall make a tender offer for, or grant to all of its
holders of its shares of Common Stock the right to require Weatherford or any
subsidiary of Weatherford to acquire from such stockholders shares of, Common
Stock, at a price in excess of the Fair Market Value (a "Put Right") or
Weatherford shall grant to all of its holders of its shares of Common Stock the
right to acquire shares of Common Stock for less than the Fair Market Value (a
"Purchase Right") then, in
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the case of a Put Right, the Warrant Price shall be adjusted by multiplying the
Warrant Price in effect immediately prior to the record date for the
determination of stockholders entitled to receive such Put Right by a fraction,
the numerator of which shall be the number of shares of Common Stock then
outstanding minus the number of shares of Common Stock which could be purchased
at the Fair Market Value for the aggregate amount which would be paid if all Put
Rights are exercised and the denominator of which is the number of shares of
Common Stock which would be outstanding if all Put Rights are exercised; and, in
the case of a Purchase Right, the Warrant Price shall be adjusted by multiplying
the Warrant Price in effect immediately prior to the record date for the
determination of the stockholders entitled to receive such Purchase Right by a
fraction, the numerator of which shall be the number of shares of Common Stock
then outstanding plus the number of shares of Common Stock which could be
purchased at the Fair Market Value for the aggregate amount which would be paid
if all Purchase Rights are exercised and the denominator of which is the number
of shares of Common Stock which would be outstanding if all Purchase Rights are
exercised. In addition, the number of shares subject to this Warrant shall be
increased by multiplying the number of shares then subject to this Warrant by a
fraction which is the inverse of the fraction used to adjust the Warrant Price.
Notwithstanding the foregoing, if any such Put Rights or Purchase Rights shall
terminate without being exercised, the Warrant Price and number of shares
subject to this Warrant shall be appropriately readjusted to reflect the Warrant
Price and number of shares then subject to this Warrant which would have been in
effect if such unexercised rights had never existed. Comparable adjustments
shall be made in the event of successive transactions of the character described
above.
In the event of a merger of one or more corporations or entities with
or into Weatherford in which Weatherford is not the sole survivor or there is an
exchange, conversion or modification to the ownership of the then outstanding
shares of Common Stock of Weatherford, a consolidation of Weatherford and any
one or more corporations or entities, a statutory share or interest exchange in
which all of the Common Stock is acquired or any other similar business
combination with respect to Weatherford in which the Common Stock is acquired by
a third party, the Holder, at no additional cost, shall be entitled to receive,
upon any exercise of this Warrant, in lieu of the number of shares as to which
this Warrant shall then represent the right to purchase, the number and class of
shares of stock or other securities, assets or other property, including cash,
to which the Holder would have been entitled to receive or continue to hold
pursuant to the terms of the agreement of merger, consolidation, share or
interest exchange or other similar transaction if at the time of such merger,
consolidation, share or interest exchange the Holder had been a holder of a
number of shares of Common Stock equal to the number of shares as to which this
Warrant shall then represent the right to purchase. Comparable rights shall
accrue to the Holder in the event of successive mergers, consolidations, share
or interest exchanges or other transactions of the character described above.
If a corporate transaction described in Section 424(a) of the Code
which involves Weatherford is to take place and there is to be no surviving
corporation while this Warrant remains in whole or in part unexercised, it shall
be cancelled by the Board of Directors of Weatherford as of the effective date
of any such corporate transaction but before the date the Holder shall be
provided with a notice of such cancellation and the Holder shall have the right
to exercise this Warrant in full (without regard to any limitations on exercise
set forth in or imposed by this Warrant) to the extent it is then still
unexercised during a 30-day period preceding the effective date of such
corporate transaction.
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For purposes of this Section 2, Fair Market Value per share of Common
Stock shall mean the closing price of a share of Common Stock as reported by the
principal national securities exchange on which the Common Stock is then listed
if the Common Stock is then listed on a national securities exchange, or the
average bid and asked prices of a share of Common Stock as reported in the
NASDAQ listing if the Common Stock is not then listed on a national securities
exchange, on the trading day immediately preceding the first trading day on
which, as a result of the establishment of a record date or otherwise, the
trading price reflects that an acquiror of Common Stock in the public market
will not participate in or receive the payment of any applicable dividend or
distribution.
Except as hereinbefore expressly provided, the issue by Weatherford of
shares of stock of any class, or securities convertible into shares of stock of
any class, for cash or property, or for labor or services either upon direct
sale or upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of Weatherford convertible into such shares
or other securities, shall not affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock then
subject to this Warrant.
3. Exercise of Warrants. This Warrant may be exercised from time to
time as to the total number of shares that may then be issuable in the manner
and subject to the limitations provided for in Section 1 hereof.
4. Assignment. This Warrant may be transferred or assigned in any
manner by the Holder.
5. Requirement of Law.
(a) In the event the shares issuable on exercise of this Warrant are
not registered under the Securities Act of 1933, Weatherford may imprint on the
certificate for such shares the following legend or any other legend which
counsel for Weatherford considers necessary or advisable to comply with
Securities Act of 1933:
The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933 or under the securities
laws of any state and may not be sold or transferred except upon such
registration or upon receipt by the Corporation of an opinion of
counsel satisfactory to the Corporation, in form and substance
satisfactory to the Corporation, that registration is not required for
such sale or transfer.
Weatherford may, but shall in no event be obligated to, register any
securities covered hereby pursuant to the Securities Act of 1933. Weatherford
shall not be obligated to take any other affirmative action in order to cause
the exercise of the Warrant or the issuance of shares of Common Stock pursuant
thereto to comply with any law or regulation of any governmental authority.
(b) Weatherford shall reserve or acquire such number of shares of
Common Stock as may be necessary from time to time to allow this Warrant to be
exercised.
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6. Termination. This Warrant, to the extent it shall not previously
have been exercised, shall terminate as follows:
(a) If Mr. Moses ceases to serve on the Board of Directors of
Weatherford prior to three years from the date hereof, for any reason, with or
without cause, other than for death, retirement under the then established rules
of the Board of Directors, or for disability, this Warrant shall terminate and
be immediately forfeited, and not be exercisable. If Mr. Moses ceases to serve
on the Board of Directors of Weatherford after three years from the date hereof,
this Warrant shall continue in effect until September 8, 1999.
(b) If Mr. Moses dies prior to three years from the date hereof, this
Warrant shall be immediately exercisable and continue in effect until 10 years
following the date of his death. If Mr. Moses dies on or after three years from
the date hereof, this Warrant shall continue in effect until September 8, 2011.
After the death of Robert Moses, his executors, administrators or any persons to
whom this Warrant may be transferred by will or by the laws of descent and
distribution or otherwise assigned shall have the right, at any time prior to
this Warrant's expiration to exercise it.
(c) If Mr. Moses shall retire from the Board of Directors of
Weatherford under the then established rules of the Board of Directors of
Weatherford prior to three years from the date hereof, the Holder shall only be
entitled to exercise this Warrant for a number of shares determined by
multiplying the number of shares subject to this Warrant by a fraction, the
numerator of which is the total whole years of service of Mr. Moses as a
director of Weatherford from the date hereof and the denominator of which is
three. With respect to the portion of this Warrant that may be so exercised it
shall be exercisable until 10 years following the date of Mr. Moses' retirement.
If Mr. Moses shall retire from the Board of Directors of Weatherford on or after
three years from the date hereof, this Warrant shall continue until September 8,
2011.
(d) If Mr. Moses shall cease to be a director of Weatherford due to
disability prior to three years from the date hereof, this Warrant shall be
immediately exercisable and continue in effect until 10 years following the date
Mr. Moses ceases to be a director of Weatherford due to disability. If Mr. Moses
shall cease to be a director of Weatherford due to disability on or after three
years from the date hereof, this Warrant shall continue in effect until
September 8, 2011.
7. Amendment. This Warrant may not be changed, amended or modified
except by an agreement in writing signed on behalf of each of the parties
hereto.
8. No Rights as a Stockholder. The Holder shall not have any rights as
a stockholder with respect to any shares of Common Stock issuable upon the
exercise of this Warrant until the date of issuance of the stock certificate or
certificates representing such shares following the Holder's exercise of this
Warrant pursuant to its terms and conditions and payment for such shares. Except
as otherwise provided in this Warrant, no adjustment shall be made for dividends
or other distributions made with respect to the Common Stock the record date for
the payment of which is prior to the date of issuance of the stock certificate
or certificates representing such shares following the Holder's exercise of this
Warrant.
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9. Governing Law. The validity, construction and performance of this
Warrant shall be governed by the laws of the State of Delaware. Any invalidity
of any provision of this Warrant shall not affect the validity of any other
provision.
10. Notices. All notices, demands, requests or other communications
hereunder shall be in writing and shall be deemed to have been duly made or
given if mailed by registered or certified mail, return receipt requested. Any
such notice mailed to Weatherford shall be addressed to its principal executive
office at 515 Post Oak Blvd., Suite 600, Houston, Texas 77027, and any notice
mailed to the Holder shall be addressed to the Holder's address as it appears on
the books and records of Weatherford or to such other address as either party
may hereafter designate in writing to the other.
11. No Rights to Continue as Director. The granting of this Warrant by
Weatherford to Mr. Moses shall not impose upon Weatherford any obligation to
retain Mr. Moses on the Board of Directors of the Weatherford.
12. Binding Effect. This Warrant shall, except as otherwise provided to
the contrary in this Warrant, inure to the benefit of and bind the successors
and assigns of Weatherford. This Warrant shall, except as otherwise provided to
the contrary in this Warrant, inure to the benefit of and bind the heirs,
executors, administrators, legal representatives and assigns of the Holder.
IN WITNESS WHEREOF, this Warrant has been duly executed and delivered
as of the day and year first above mentioned.
WEATHERFORD INTERNATIONAL, INC.
By:
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Name:
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Title:
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ROBERT K. MOSES, JR.
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