<PAGE>
As filed with the Securities and Exchange Commission on August 16, 1995
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
VARCO INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
California 95-0472620
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
743 North Eckhoff Street 92668
Orange, California (Zip Code)
(Address of Principal Executive Offices)
</TABLE>
The Varco 1980 Employee Stock Purchase Plan
(Full title of the plan)
RICHARD A. KERTSON
Vice President-Finance and Chief Financial Officer
743 North Eckhoff Street
Orange, California 92668
(Name and address of agent for service)
(714) 978-1900
(Telephone number, including area code, of agent for service)
The Commission is requested to send copies of all communications to:
LARRY M. MEEKS, ESQ.
Pircher, Nichols & Meeks
1999 Avenue of the Stars, Suite 2600
Los Angeles, California 90067
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
======================================================================================================
Proposed Proposed
maximum maximum
Title of securities Amount offering price aggregate Amount of
to be registered to be registered per unit offering price registration fee
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock(1) 1,000,000 shares $10.9375(2) $10,937,500(2) $3,771.55
======================================================================================================
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
Registration Statement also covers an indeterminate amount of interests to
be offered or sold pursuant to the employee benefit plan described herein.
(2) Calculated pursuant to Rule 457(c), based on the average of the high and low
prices for the Common Stock on the New York Stock Exchange Composite Tape
for August 14, 1995.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents which have heretofore been filed by Varco
International, Inc. (the "Company") or The Varco 1980 Employee Stock Purchase
Plan (the "Plan") with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934 are incorporated by reference in this
registration statement:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994.
(2) The Company's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1995 and June 30, 1995.
(3) The description of the Company's Common Stock contained in the
Company's Form 8-A Registration Statement filed May 29, 1981, including any
amendment or report filed for the purpose of updating such description.
(4) The Plan's Annual Report on Form 11-K for the fiscal year ended
March 31, 1995.
In addition, all documents filed by the Company or the Plan pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
after the date hereof and prior to the filing of a post-effective amendment to
this Registration Statement which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference in this Registration Statement and to be
a part hereof from their respective dates of filing.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the Common Stock registered pursuant to this Registration
Statement has been passed upon for the Company by Pircher, Nichols & Meeks, of
which Leo J. Pircher, a director of the Company, is a partner. Mr. Pircher
owns,
1
<PAGE>
and has options to purchase, Common Stock of the Company and is eligible to
participate in the Company's 1994 Directors' Stock Option Plan.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 204(a)(10) of the California General Corporation Law (the "GCL")
permits a corporation, in its Articles of Incorporation, to eliminate or limit
the personal liability of directors for monetary damages in an action brought by
or in the right of the corporation (a "derivative action") for breach of a
director's duties to the corporation provided, however, that such a provision
may not eliminate or limit the liability of directors for (1) acts or omissions
that involve intentional misconduct or a knowing and culpable violation of law;
(2) acts or omissions that a director believes to be contrary to the best
interests of the corporation or its shareholders or that involve the absence of
good faith on the part of the director; (3) any transaction from which the
director derived an improper personal benefit; (4) acts or omissions that show a
reckless disregard for the director's duty to the corporation or its
shareholders in circumstances in which the director was aware, or should have
been aware, in the ordinary course of performing a director's duties, of a risk
of serious injury to the corporation or its shareholders; (5) acts or omissions
that constitute an unexcused pattern of inattention that amounts to an
abdication of the director's duty to the corporation or its shareholders; (6)
transactions between a corporation and its directors or corporations having
interrelated directors under Section 310 of the GCL; or (7) improper
distributions to shareholders, loans or guaranties under Section 316 of the GCL.
Section 204(a)(11) of the GCL permits a corporation in its Articles of
Incorporation to provide for indemnification of directors, officers, employees
and other agents by bylaw, agreement or otherwise in excess of that expressly
permitted by Section 317 of the GCL except that provision may not be made for
indemnification which is expressly prohibited by Section 317 of the GCL or for
acts or omissions from which a director may not be relieved of liability under
Section 204(a)(10) of the GCL.
Section 317(b) of the GCL permits a corporation to indemnify a director,
officer, employee or other agent against expenses, judgments, fines, settlements
and other amounts incurred in connection with any proceeding other than a
derivative action if he acted in good faith and in a manner he reasonably
believed to be in the best interests of the corporation and, in the case of a
criminal proceeding, had no reasonable cause to believe that his conduct was
unlawful.
With respect to derivative actions, Section 317(c) of the GCL permits a
corporation to indemnify a director, officer, employee or other agent against
expenses incurred in connection with the defense or settlement of such an action
if he acted in good faith and in a manner which he believed to be in the best
2
<PAGE>
interests of the corporation and its shareholders. Under Section 317(c),
indemnification in a derivative action is not permitted (1) with respect to any
matter in which the person seeking indemnification is held to be liable to the
corporation in the performance of his duties to the corporation and its
shareholders unless and only to the extent that the court in which the
proceeding was brought determines that, in view of all of the circumstances of
the case, such person is fairly and reasonably entitled to indemnification for
expenses and then only to the extent that such court shall determine; (2) for
any amount paid in settling or otherwise disposing of a pending action without
court approval; or (3) for expenses incurred in defending a pending action which
is settled or otherwise disposed of without court approval.
Section 317(d) of the GCL requires a corporation to indemnify any director,
officer, employee or other agent for all expenses actually and reasonably
incurred by him in any proceeding to the extent that he is successful on the
merits.
The Company's Amended and Restated Articles of Incorporation (1) eliminate
the liability of directors for monetary damages to the fullest extent permitted
under California law and (2) permit the Company to provide indemnification to
directors, officers, employees and other agents by bylaw provisions, agreements,
vote of shareholders or disinterested directors, or otherwise, in excess of the
indemnification otherwise permitted by Section 317 of the GCL subject only to
the limits set forth in Section 204 of the GCL.
The Bylaws of the Company generally require indemnification of any officer
or director of the Company for all costs, charges, expenses, liabilities and
losses (including attorneys' fees, judgments, fines, ERISA excise taxes or
penalties, and amounts paid in settlement) incurred in any action, suit or
proceeding by reason of the fact that he is or was a director of the Company
except to the extent that such indemnification would be expressly prohibited
under California law or the Company's Amended and Restated Articles of
Incorporation.
The Company is a party to an Indemnity Agreement with each of its directors
and executive officers which generally provides the indemnitee with a
contractual right to indemnification for all Expenses (which is defined to
include attorneys' fees and amounts paid in settlement), judgments, fines,
penalties and ERISA excise taxes incurred in any action, suit or proceeding by
reason of his position with the Company, except to the extent that such
indemnification is prohibited by California law.
The Company also maintains a liability insurance policy under which
officers and directors are generally indemnified against losses and liability
(including costs, expenses, settlements and judgments) incurred by them in such
capacities, other than specified excluded losses.
3
<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
4.1 Amended and Restated Articles of Incorporation of the Company,
incorporated by reference to Exhibit 3 to the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1995.
*4.2 The Varco 1980 Employee Stock Purchase Plan, as amended through
February 16, 1995.
*5 Opinion of Pircher, Nichols & Meeks.
*23.1 Consent of Ernst & Young LLP.
*23.2 Consent of Pircher, Nichols & Meeks (included in Exhibit 5).
*24 Power of Attorney.
_____________
*Filed herewith.
ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this registration statement (or the most
recent post-effective amendment hereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this registration
statement or any material change to such information in this
registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished
to the Commission by the registrant pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by reference
in this registration statement.
4
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) of Section 15(d) of the
Securities Exchange Act of 1934 (and each filing of the annual report of the
Plan pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in this registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceedings) is asserted by
such director, officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Orange, State of California, on August 16, 1995.
VARCO INTERNATIONAL, INC.
By: /s/ Richard A. Kertson
-------------------------------------
Richard A. Kertson
Vice President-Finance
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
President and Chief
Executive Officer and
Director
*GEORGE BOYADJIEFF (Principal Executive
------------------------------------ Officer) August 16, 1995
George Boyadjieff
Vice President-Finance
and Chief Financial
Officer
/s/Richard A. Kertson (Principal Financial
------------------------------------ Officer) August 16, 1995
Richard A. Kertson
Controller-Treasurer
and Chief Accounting
Officer
/s/Donald L. Stichler (Principal Accounting
------------------------------------ Officer) August 16, 1995
Donald L. Stichler
*WALTER B. REINHOLD Director August 16, 1995
------------------------------------
Walter B. Reinhold
</TABLE>
6
<PAGE>
<TABLE>
<S> <C> <C>
*TALTON R. EMBRY Director August 16, 1995
------------------------------------
Talton R. Embry
*ANDRE R. HORN Director August 16, 1995
------------------------------------
Andre R. Horn
*MAURICE E. JACQUES Director August 16, 1995
------------------------------------
Maurice E. Jacques
*JACK W. KNOWLTON Director August 16, 1995
------------------------------------
Jack W. Knowlton
*LEO J. PIRCHER Director August 16, 1995
------------------------------------
Leo J. Pircher
*CARROLL W. SUGGS Director August 16, 1995
------------------------------------
Carroll W. Suggs
*ROBERT A. TEITSWORTH Director August 16, 1995
------------------------------------
Robert A. Teitsworth
*EUGENE R. WHITE Director August 16, 1995
------------------------------------
Eugene R. White
*JAMES D. WOODS Director August 16, 1995
------------------------------------
James D. Woods
*By /s/Richard A. Kertson
------------------------------------
Richard A. Kertson
Attorney-in-fact
</TABLE>
7
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, the Plan has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Orange, State of
California, on August 16, 1995.
THE VARCO 1980 EMPLOYEE
STOCK PURCHASE PLAN
By *JACK W. KNOWLTON
------------------------------
Jack W. Knowlton, Member
of the Compensation Committee,
Administrator of the Plan
By *ROBERT A. TEITSWORTH
------------------------------
Robert A. Teitsworth, Member
of the Compensation Committee,
Administrator of the Plan
By *JAMES D. WOODS
------------------------------
James D. Woods, Member
of the Compensation Committee,
Administrator of the Plan
*By /s/Richard A. Kertson
-------------------------------------
Richard A. Kertson
Attorney-in-fact
8
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Page
------- ----
<C> <S> <C>
4.1 Amended and Restated Articles of Incorporation of the Company,
incorporated by reference to Exhibit 3 to the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 1995.
4.2 The Varco 1980 Employee Stock Purchase Plan, as amended through February
16, 1995.
5 Opinion of Pircher, Nichols & Meeks.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Pircher, Nichols & Meeks (included in Exhibit 5).
24 Power of Attorney.
</TABLE>
<PAGE>
EXHIBIT 4.2
THE VARCO 1980 EMPLOYEE STOCK PURCHASE PLAN
AS AMENDED THROUGH FEBRUARY 16, 1995
1. ESTABLISHMENT OF THE PLAN.
These thirteen numbered Sections shall constitute and be known as "The
Varco 1980 Employee Stock Purchase Plan" (hereinafter, the "Plan"). The Company
has established this Plan to afford Employees of the Company a convenient means
for regular and systematic purchases of Stock through payroll deductions. The
purpose of the Plan is to attract and retain Employees of outstanding abilities
and to motivate eligible Employees to dedicate their maximum productive efforts
on behalf of the Company and its stockholders by providing a method whereby they
voluntarily may purchase the Stock at a favorable price and upon favorable
terms. Under the Plan, Stock will be purchased at a price less than the fair
market value of the Stock at the time of purchase. Purchases under the Plan
will not involve the payment of any brokerage fees or commissions and exercise
of rights under the Plan (the "Rights") will be automatic, without inconvenience
to Participants. For a further explanation of these matters, see "4.2 Election
to Participate in the Plan" and "6.3 Exercise of Rights and Delivery of Share
Certificates Under the Plan" below.
2. DEFINITIONS.
Unless otherwise indicated, the following terms shall have the following
meanings:
2.1 "Company" means Varco International, Inc., a California corporation, or
any successor in interest to it resulting from merger, consolidation or transfer
of assets substantially as a whole, which successor in interest expressly agrees
in writing to continue the Plan.
2.2 "Employee" means a Regular Full-time Employee of the Company or of a
Participating Subsidiary, including, without limitation, directors, trustees or
officers.
2.3 "Participant" means any Employee who participates in the Plan.
2.4 "Participating Subsidiary" means any corporation in which the Company
owns 50% or more of the capital stock having voting power under
1
<PAGE>
ordinary circumstances, which has been designated as a "Participating
Subsidiary" by the Board of Directors of the Company. In addition,
"Participating Subsidiary" includes any "subsidiary corporation" as such term is
defined in Section 425 of the Internal Revenue Code of 1954, as amended (the
"Code").
2.5 "Purchase Period" means the six-month period commencing on April 1 and
October 1 in each year during which the Plan is in effect.
2.6 "Regular Full-Time Employee" means an Employee whose customary
employment is more than 20 hours per week or more than five months in any
calendar year.
2.7 "Stock" means the common stock of the Company.
3. EFFECTIVE DATE AND TERM.
3.1 Effective Date of the Plan. The Plan is being adopted by the Board of
Directors as of this 13th day of December 1979, and will become effective on
April 1, 1980.
3.2 Term of the Plan. The Plan shall remain in force for a period of twenty-
five years following its effective date unless it is sooner terminated by a
resolution adopted by the Company's Board of Directors. Termination of the Plan
by action of the Board of Directors shall not diminish the Rights of any
existing Participant, nor shall it impair the Company's obligations under any
outstanding Rights.
4. PARTICIPATION OF EMPLOYEES.
4.1 Eligibility to Participate in the Plan. Subject to the exceptions and
limitations set forth herein, all Regular Full-Time Employees shall be eligible
to participate in the Plan. However, no employee shall be eligible to
participate in the Plan unless he or she has completed at least three months as
a continuous full-time employee. Furthermore, an employee may not participate if
in doing so he or she would own stock (as defined by Sections 423(b)(3) and
425(d) of the Code) possessing 5% or more of the total combined voting power or
value of all classes of the Company's or any subsidiary's stock.
4.2 Election to Participate in the Plan. Participation in the Plan is
entirely voluntary. Each eligible employee may become a Participant in the Plan
by delivering a payroll deduction authorization (the "Authorization") in the
manner prescribed by the Compensation Committee of the Company's Board of
Directors
2
<PAGE>
(the "Committee"). Use of the Authorization as herein provided is the exclusive
means by which an Employee may participate in the Plan; the Authorization must
be delivered to the Company during the calendar month preceding commencement of
a Purchase Period. Participants may enroll in the Plan only in the thirty day
period prior to the first day of each Purchase Period in each year during which
the Plan is in effect.
5. EMPLOYEE CONTRIBUTIONS, TERMINATION OF PARTICIPATION AND WITHDRAWAL FROM
THE PLAN.
5.1 Amount of Contribution to the Plan. The Authorization discussed in
paragraph 4.2 above shall designate a stated amount to be deducted from the
Employee's compensation on each payday and paid into the Plan for the Employee's
account. The "stated amount" may not be less than a sum which will result in
the payment into the Plan of at least $5.00 each payday. The "stated amount"
herein may not exceed either (i) 10% of the amount of "Eligible Compensation"
(which is the regular rate of pay on the date of a grant under the Plan,
excluding incentives, bonuses, overtime, extended work-week premiums, or other
special payments, fees or allowances) from which the deduction is made; or (ii)
an amount which, under the Plan or under any similar Company Plan or that of any
of its subsidiaries or related corporations, would result in the Employee
purchasing shares at a rate exceeding $25,000 in fair market value (determined
as of the date participation commences) for each calendar year in which Rights
are granted.
5.2 Changes in Amount of Contribution to the Plan. The Authorizations may
not be altered as to the amount of the Participant's contribution during each
Purchase Period.
5.3 Termination of Contributions to the Plan and Withdrawal Therefrom.
Any Participant may terminate further contributions and withdraw in whole from
the Plan at any time. A Participant who wishes to withdraw from the Plan must
deliver to the Company a notice of withdrawal (the "Notice") in a form prepared
by the Company. Promptly following delivery of the Notice, the balance of funds
in the Participant's account under the Plan will be returned in cash or by check
and the Participant's interest in the Plan shall terminate. A Participant
withdrawing from the Plan shall be eligible to participate again upon expiration
of the Purchase Period during which he withdrew.
5.4 Effect of Employment Termination Other Than by Retirement or Death on
Plan Rights. If a Participant's employment terminates other than by retirement
or death, the Participant's Rights in the Plan automatically terminate. In such
event, the Company promptly will refund to the Participant the balance in the
3
<PAGE>
Participant's account under the Plan, and thereupon the Participant's interest
in the Plan shall terminate.
5.5 Retirement and the Plan. A Participant retiring on the Participant's
normal retirement date, or earlier or later with the consent of the Company,
may, at the Participant's election, either (i) by written notice to the Company
exercise his or her rights under the Plan to apply the balance in the
Participant's account under the Plan to the "Purchase Plan Price" (as such
quoted term is hereinafter defined) of whole shares of the Company's Stock,
refunding the excess, if any, or (ii) by written notice to the Company request
payment of the balance in his or her account, in which event the Company shall
make such payment, terminating any further interest of the Participant in the
Plan. If the Participant elects to exercise his or her rights under the Plan,
the date of retirement shall be deemed to be the date of exercise for purposes
of computing the Purchase Plan Price of the Company's Stock.
5.6 Effect of the Employee's Death on Plan Rights. If a Participant's
employment is terminated by death, the executor of the Participant's will or the
administrator of the Participant's estate may by written notice to the Company
either (i) exercise the Participant's Rights as of the date of his or her death,
in which event the Company shall apply the balance in the Participant's account
to the purchase at the Purchase Plan Price of whole shares of the Company's
Stock, refunding the excess, if any, or (ii) request payment of the balance in
the Participant's account under the Plan, in which event the Company promptly
shall make such payment, terminating the Participant's interest in the Plan. If
Rights are exercised, the Participant's date of death shall be deemed the date
of exercise for purposes of computing the Purchase Plan Price of the Company's
Stock. If the Company does not receive such notice within 90 days of the
Participant's death, the Participant's representative shall be conclusively
presumed to have elected alternative (ii) above.
6. EXERCISE OF RIGHTS.
6.1 Shares Subject to the Plan. Subject to the provisions in Section 9
(relating to adjustment upon changes in the Company's capitalization), shares of
stock sold pursuant to Rights existing under the Plan shall not exceed, in the
aggregate, 2,000,000 shares of the Company's authorized Stock. These shares may
be unissued or reacquired shares, or shares purchased on the market for purposes
of the Plan.
6.2 Shares Subject to Rights Under the Plan. Subject to the requirements
of paragraph 4.1 above, following the effective date of the Plan and continuing
while the Plan remains in force, the Company will offer Rights under the Plan to
all
4
<PAGE>
eligible Employees to purchase shares of Stock. The number of shares subject to
each Right shall be the quotient of the total payroll deductions authorized
during the Purchase Period divided by the Purchase Plan Price per share,
excluding all fractions in the calculation of the quotient.
6.3 Exercise of Rights and Delivery of Share Certificates Under the Plan.
Each Participant in the Plan automatically will be deemed to have exercised his
or her Rights on each date of exercise (the last day of the six-month period
following the date on which Rights are granted) to the extent that the balance
then in the Participant's account under the Plan is sufficient to purchase at
the Purchase Plan Price whole shares of the Company's Stock. The "Purchase Plan
Price" per share to be paid by each Participant on each exercise of his or her
Rights under the Plan shall be a sum equal to 85% of the fair market value of
the Stock subject to the Plan on the date of exercise or on the date the
Participant commenced participation in the Plan, whichever amount is less. Fair
market value for purposes hereof shall be either (i) the mean between the "bid"
and "ask" prices of the Stock on the National Over-The-Counter Market or, (ii)
in the event the Stock is hereafter listed for pricing on a national securities
exchange, the per share price of the last sale of such Stock on such exchange.
Any balance remaining in the Participant's account after payment of the total
Purchase Plan Price shall be refunded promptly. The Company will deliver to
each Participant a certificate issued in the Participant's name for the number
of shares purchased under the Plan as soon as practicable following the date of
exercise. In the event the Company is required to obtain from any commission or
agency authority to issue any share certificate, the Company will seek such
authority. Inability to obtain such authorization (deemed necessary by the
Company's counsel for the lawful issuance of any share certificate) shall
relieve the Company from liability to any Participant in the Plan except for
return of the amount in the Participant's account. Amounts withheld under an
Authorization will be reported no less than monthly with the transmittal of the
Participant's payroll check. The number of shares acquired by a Participant
during each Purchase Period will be reported at least once annually.
7. RIGHTS IN SHARES PRIOR TO EXERCISE OF RIGHTS UNDER THE PLAN.
A participant shall not have the rights and privileges of a shareholder
until certificates are issued following exercise of Rights under the Plan.
8. RESTRICTIONS UPON ASSIGNMENTS.
Rights under the Plan shall not be transferable otherwise than by will or
the laws of descent and distribution, and are exercisable during the
Participant's
5
<PAGE>
lifetime only by the Participant. The Company will not recognize any purported
assignment by a Participant of rights under the Plan.
9. EFFECT OF CHANGES IN THE COMPANY'S CAPITAL STRUCTURE.
Whenever any change is made in the Stock subject to the Plan, or subject to
Rights outstanding under the Plan, by reason of stock dividend, subdivision,
combinations, or reclassification of shares, appropriate action will be taken by
the Committee to adjust accordingly the number of shares subject to the Plan and
the Purchase Plan Price of the shares.
10. ADMINISTRATION OF THE PLAN.
The Plan is being administered by the Committee, which shall be composed of
not less than three directors of the Company, none of whom shall be eligible to
serve on the Committee unless he or she is then a "disinterested person" within
the meaning of paragraph (b) of Rule 16b-3 (which has been adopted by the
Securities and Exchange Commission under the Securities Exchange Act of 1934) if
and as the Rule is then in effect. Each member shall serve a term commencing on
a date specified by the Board and continuing until death, resignation or removal
from office by the Board or from the Board by the shareholders.
The Committee shall have the power to enact, amend and repeal rules and
regulations for the interpretation and administration of the Plan.
11. AMENDMENT OF THE PLAN.
The Board may amend the Plan at any time and from time to time, subject to
the required approval by holders of more than 50% of the outstanding shares of
the Company entitled to vote for amendment of the Plan (i) to change the number
of shares reserved for Rights under the Plan, or (ii) to decrease the Purchase
Plan Price.
12. MISCELLANEOUS.
12.1 Participation in the Plan While on a Leave of Absence. During a leave
of absence approved by the Company and meeting the requirements of Regulation
1.421-7(h)(2) of the Revenue Code Regulations, a Participant may continue
participation in the Plan by cash payments to the Company on normal paydays
equal to the reduction in Plan payroll deductions caused by the absence.
6
<PAGE>
12.2 Use of Funds Paid into the Plan. All funds received or held by the
Company under the Plan will be included in the general funds of the Company free
of any trust or other restrictions, and may be used for any corporate purpose.
12.3 No Interest on Funds Paid into the Plan. No interest will be paid to
any Participant or credited to the Participant's account under the Plan.
13. ACKNOWLEDGMENT.
The execution of this instrument by the Secretary or any Assistant
Secretary of the Company shall acknowledge the adoption of this plan by the
Board of Directors of the Company.
7
<PAGE>
EXHIBIT 5
PIRCHER, NICHOLS & MEEKS
Attorneys at Law
1999 Avenue of the Stars
Suite 2600
Los Angeles, California 90067
(310) 201-8900
FAX (310) 201-8922
August 16, 1995
Varco International, Inc.
743 North Eckhoff Street
Orange, California 92668
Ladies & Gentlemen:
We have acted as counsel to Varco International, Inc. (the "Company") in
connection with the preparation and filing by the Company of a Registration
Statement on Form S-8 (the "Registration Statement"), relating to 1,000,000
shares of the Company's Common Stock authorized for sale under The Varco 1980
Employee Stock Purchase Plan, as amended (the "Plan").
We have reviewed originals or copies, certified or otherwise identified to
our satisfaction, of the Registration Statement and such certificates of public
officials and of officers of the Company and such other documents, corporate
records or other instruments as we have deemed necessary or appropriate for the
purposes of this opinion. We have assumed that all signatures on all documents
examined by us are genuine, all documents submitted to us as originals are
authentic, and all documents submitted to us as copies conform with the original
executed documents.
Based upon the foregoing, we are of the opinion that:
1. The Company is validly organized and existing under the laws of the
State of California.
2. Any shares of the Common Stock of the Company issued and sold by the
Company in accordance with the terms and provisions of the Plan will
<PAGE>
constitute validly authorized and issued Common Stock of the Company and will be
fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement referred to above.
Very truly yours,
/s/ PIRCHER, NICHOLS & MEEKS
<PAGE>
EXHIBIT 23.1
Consent of Independent Auditors
We consent to the incorporation by reference in this Registration Statement on
Form S-8 pertaining to The Varco 1980 Employee Stock Purchase Plan of Varco
International, Inc. of our reports (a) dated February 17, 1995, (1) with respect
to the consolidated financial statements of Varco International, Inc.
incorporated by reference in its Annual Report (Form 10-K) for the year ended
December 31, 1994 and (2) with respect to the schedule included therein, filed
as an exhibit thereto (b) dated May 25, 1995, with respect to the financial
statements of The Varco 1980 Employee Stock Purchase Plan included in the Plan's
Annual Report (Form 11-K) for the year ended March 31, 1995, filed with the
Securities and Exchange Commission.
/s/ Ernst & Young LLP
Orange County, California
August 16, 1995
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints
RICHARD A. KERTSON his or her true and lawful attorney-in-fact, with full power
of substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to execute a Registration Statement on
Form S-8 of Varco International, Inc. (the "Company") relating to the
registration under the Securities Act of 1933, as amended, of 1,000,000
additional shares of the Common Stock of the Company issuable pursuant to The
Varco 1980 Employee Stock Purchase Plan, as amended, and any and all amendments
or post-effective amendments to said Registration Statement and to file the
same, with exhibits thereto and other documents in connection therewith, with
the Securities and Exchange Commission.
/s/ George Boyadjieff /s/ Walter B. Reinhold
------------------------ ------------------------------
GEORGE BOYADJIEFF WALTER B. REINHOLD
/s/ Talton R. Embry /s/ Carroll W. Suggs
------------------------ -------------------------------
TALTON R. EMBRY CARROLL W. SUGGS
/s/ Andre R. Horn /s/ Robert A. Teitsworth
------------------------ --------------------------------
ANDRE R. HORN ROBERT A. TEITSWORTH
/s/ Maurice E. Jacques /s/ Eugene R. White
------------------------ --------------------------------
MAURICE E. JACQUES EUGENE R. WHITE
/s/ Jack W. Knowlton /s/ James D. Woods
------------------------ --------------------------------
JACK W. KNOWLTON JAMES D. WOODS
/s/ Leo J. Pircher
------------------------
LEO J. PIRCHER
Dated: May 18, 1995
