EXHIBIT 4.7
COMMON STOCK ISSUANCE AGREEMENT
This Common Stock Issuance Agreement (the "Agreement") Corporation (the
"Company") and DeepFlex Production Partners L.P. (the "Purchaser").
Capitalized terms used but not defined herein are used as defined in the
Memorandum of Agreement dated August 31, 1995 between the Company and FPS II,
Inc. on behalf of the Purchaser (the "Purchase Agreement").
Recitals
1. Each of the Company and FPS II, Inc., as holder of legal title for
the benefit of DeepFlex Production Partners L.P. of that certain
semisubmersible drilling rig "FPS ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇" (EX-"TREASURE DRILLER")
registered in the Commonwealth of Bahamas, has entered into and agreed to
perform the Purchase Agreement.
2. In connection with the transactions contemplated by the Purchase
Agreement, the Company has agreed to issue certain shares (the "Shares") of
its Common Stock, $.05 par value (the "Common Stock"), to the Purchaser as
provided in the Purchase Agreement.
3. The Purchaser has requested that the Company undertake to register
the Shares under the Securities Act of 1933, as amended (the "Act"), for
resale from time to time following the date of the closing referred to in the
Purchase Agreement (the "Closing Date").
Accordingly, in consideration of the premises and the mutual agreements
contained herein and in the Purchase Agreement, the parties hereto hereby
agree as follows:
Section 1. Agreements to Issue and Purchase.
Subject to all the terms and conditions set forth herein and in the
Purchase Agreement, (i) the Company hereby agrees to issue and sell in a
private offering to the Purchaser and (ii) the Purchaser agrees to acquire
from the Company, 1,232,057 Shares.
Section 2. Delivery of the Shares.
Issuance and delivery to the Purchaser (or its nominee as described in
Section 9(i) hereof) of the Shares by the Company shall be made at the
closing referred to in the Purchase Agreement promptly following the receipt
by the Company of listing approval for the Shares on the New York Stock
Exchange. The place and time of delivery for the Shares may be varied by
agreement between the Purchaser and the Company.
Section 3. Legends; Transfer Restrictions.
(a) To insure compliance with the applicable provisions of the Act and
the terms of this Agreement, no Shares shall be sold or transferred except in
a transaction permitted by this Section 3 or involving the registration of
such Shares under the Act.
(b) Except as otherwise provided in Section 3(e) hereof, each
certificate for any Shares shall be issued with a legend in substantially the
following form:
"The transfer of the securities represented by this certificate is
subject to the conditions specified in that certain Common Stock Issuance
Agreement dated as of August 31, 1995, with Reading & ▇▇▇▇▇ Corporation (the
"Company"), as the same may from time to time be amended. The securities
represented by this certificate have not been registered under the United
States Securities Act of 1933, as amended (the "Securities Act"), or under
any state securities or laws and may not be offered or sold unless such offer
or sale is made pursuant to an effective registration statement under the
Securities Act or is made in a transaction exempt from the registration
requirements of the Securities Act and applicable state securities laws.
(c) Each holder of Shares shall have the right to transfer Shares (i)
to any Person who agrees in writing to take the same subject to the terms and
provisions of this Agreement or (ii) pursuant to Rule 144 or Regulation S
under the Act or any successor rule or regulation thereto; provided, that in
the case of clause (i) above, no such transfer shall be effective unless the
written agreement providing for such transfer includes representations and
warranties (expressed to be for the benefit of the Company as well as all
other holders of Shares) substantially in the form set forth in Section 6
hereof (other than clause (e) thereof) and signed counterparts of such
agreement are delivered to the Company. Each such transferee shall be
subject to the same transfer restrictions imposed by this Agreement.
(d) Notwithstanding anything to the contrary in this Agreement, no
holder of Shares shall transfer any Shares pursuant to Section 3(c) hereof,
and no such transfer shall be effective, unless such holder has delivered to
the Company an opinion of counsel reasonably satisfactory to the Company
(which counsel may include attorneys who are employees of such holder) that
registration in respect of such transfer is not required under the Act.
(e) Notwithstanding the foregoing provisions of this Section 3, all of
the restrictions imposed hereby upon the transferability of the Shares shall
terminate as to such Shares when:
(i) they have been registered under the Act and sold in accordance
with such registration; or
(ii) counsel reasonably satisfactory to the Company has rendered an
opinion to the Company that all of the Shares may be freely sold to the
public without compliance with the registration provisions of the Act
or any volume or manner of sale restrictions under Rule 144; or
(iii) counsel reasonably satisfactory to the Company has rendered an
opinion to the Company that such Shares may be freely sold to the
public without compliance with the registration provisions of the Act.
Whenever the restrictions imposed by this Section 3 terminate as to any
Shares, the holder thereof shall be entitled to receive from the Company,
upon certification by the holder as to the circumstances of such termination
to the reasonable satisfaction of the Company, without expense, a new
certificate not bearing the legends otherwise required pursuant to this
Section 3.
Section 4. Registration by the Company.
The Company and the Purchaser hereby agree as follows:
(a) The Company undertakes and agrees to take all action required to
permit the holders of the Shares to offer and sell the Shares pursuant to an
effective registration statement covering the Shares (a "Registration
Statement") at all times during the Registration Period (as defined below)
and to ensure that one or more Registration Statement(s) and any related
prospectus (each, a "Prospectus") remain continuously effective and in full
compliance with all applicable provisions of the Act, the Securities Exchange
Act of 1934, as amended (the "Exchange Act") and the respective rules and
regulations of the Securities and Exchange Commission (the "Commission")
thereunder (the "Rules and Regulations") until the end of the Registration
Period. In furtherance of the foregoing, the Company shall file a "shelf"
Registration Statement within 30 days of the Closing Date and shall
thereafter use its best efforts to cause such Registration Statement to be
declared effective as soon thereafter as practicable.
(b) The "Registration Period" shall begin on the date that a
Registration Statement with respect to the Shares is declared effective and
shall continue until terminated by the Company by notice to the holders of
Shares; provided, that the Company shall not terminate the Registration
Period prior to the earlier to occur of (i) the first anniversary of the date
on which the Registration Statement is first declared effective or (ii) the
sale of all of the Shares pursuant to a Registration Statement.
Notwithstanding the foregoing, the Registration Period shall be extended by a
period of time following such first anniversary equal to any period of time
that offers and sales of Shares under the Registration Statement are
prevented by any stop order, injunction or other action of the Commission or
any Notice of Amendment pursuant to Section 4(e).
(c) During the Registration Period, the Company will advise holders of
Shares promptly in writing: (i) of any request by the Commission for
amendment of or a supplement to the Registration Statement or the Prospectus
or for additional information; (ii) of the issuance of any stop order
suspending the effectiveness of the Registration Statement or of the
suspension of qualification of the Shares for offering or sale in any
jurisdiction or the initiation of any proceeding for such purpose; and (iii)
of any change in the Company's condition (financial or other) business,
prospects, properties, net worth or results of operations, or of the
happening of any event, which makes any statement of a material fact made in
the Registration Statement or the Prospectus (as then amended or
supplemented) untrue or which requires the making of any additions to or
changes in the Registration Statement or the Prospectus (as then amended or
supplemented) in order to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading, or of
the necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the applicable requirements of the Act or the
Exchange Act or the Rules and Regulations. If at any time a stop order
suspending the effectiveness of the Registration Statement shall be issued,
the Company will make every reasonable effort to obtain the withdrawal of
such order at the earliest possible time.
(d) During the Registration Period, the Company will expeditiously
deliver to each holder of Shares, without charge, such number of copies of
the Registration Statement and the Prospectus and of any amendment or
supplement thereto as each holder of Shares may reasonably request. The
Company consents to the use of the Registration Statement and the Prospectus
and of any current amendment or supplement thereto by each holder of Shares
for non-underwritten resales of Shares during the Registration Period in
accordance with the Act, the Exchange Act and the Rules and Regulations.
(e) If during the Registration Period any event shall occur that in the
judgment of the Company is required to be set forth in the Prospectus as then
amended or supplemented or should be set forth therein in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary to supplement or amend the
Prospectus or to file under the Exchange Act any document which, upon filing,
will be incorporated by reference therein in order to comply with the Act,
the Exchange Act or the Rules and Regulations, the Company will forthwith
notify the holders of Shares in writing of such event or requirement (a
"Notice of Amendment") and prepare and file with the Commission an
appropriate supplement or amendment thereto and furnish copies thereof,
together with a written notice of such amendment or supplement ("Notice of
Correction"), to the holders of Shares. Following any Notice of Amendment
as aforesaid, no holder of Shares shall effect any offer or sale of Shares
prior to receipt from the Company of a Notice of Correction, which notice
shall include a statement that sales of the Shares are again permitted under
the Registration Statement. Each holder of Shares included in the
Registration Statement undertakes and agrees expeditiously to provide a
complete and accurate Holder Questionnaire or otherwise confirm to the
Company any information regarding such holder included or required to be
included in the Registration Statement, to update such holder's Holder
Questionnaire whenever necessary and to inform the Company in writing of any
additions to or other changes in such information, including any changes in
the number of Shares or other securities of the Company from time to time
owned by such holder.
(f) In connection with each Registration Statement, the Company shall
pay all filing fees of the Commission, printing expenses, stock exchange
listing fees, Company counsel and auditor fees (but not fees of counsel or
auditors for the holders of Shares), registrar and transfer agent fees and
"blue sky" and National Association of Securities Dealers, Inc. fees.
(g) The Company will not take, directly or indirectly, any action
designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Common Stock in connection
with the issuance of the Shares contemplated hereby.
(h) The Company shall (i) apply to the New York Stock Exchange for the
listing of the Shares thereon prior to the Closing Date, (ii) use its best
efforts to have the Shares approved for listing, subject to notice of
issuance, thereon and (iii) maintain the listing of the Shares thereon as
long as the Common Stock is so listed.
(i) Notwithstanding anything to the contrary in this Agreement, the
Company shall be permitted to effect the registration, issuance, offer,
underwriting and/or sale of securities issued by the Company or its
subsidiaries (whether issued and outstanding prior to or subsequent to the
date hereof) at any time during the Registration Period (including, without
limitation, by including other securities issued by the Company in a
Registration Statement or by extending any existing shelf registration
pursuant to Rule 415 under the Act) and, except as expressly provided herein,
holders of Shares shall not be entitled to participate in any such
registration, offering or transaction without the Company's prior consent.
(j) In connection with a reasonable and customary due diligence
investigation relating to a Registration Statement, the Company shall (i)
make reasonably available for inspection by holders of Shares and their
attorneys, accountants and other agents and representatives all relevant
financial and other records, corporate documents and properties and (ii)
cause the Company's officers, directors and employees to cooperate in
supplying all information reasonably requested by such persons; provided,
that any information that is designated by the Company as confidential shall
be kept confidential by such persons, unless disclosure thereof is required
by applicable law or regulation or such information becomes publicly
available other than as a result of a breach hereof by any such person.
(k) In the event that a Registration Statement is effective and
available to the holders for resales of Shares for less than 330 days during
the 365-day period immediately following the Closing Date, at any time that
the Shares are not registered for resale pursuant to an effective
Registration Statement, the Purchaser shall be entitled to one demand
registration and unlimited "piggyback" registrations with respect to the
Shares as provided in this Section 4(k):
(i) Demand Registrations.
(A) Upon the written demand of the Purchaser to the Company
specifying the number of Shares to be registered and the intended method of
disposition thereof, the Company will promptly prepare and file, and will
thereafter use its best efforts to cause to be declared effective, a
Registration Statement covering such Shares as promptly thereafter as
possible.
(B) The Company shall enter into such customary agreements (including
an underwriting agreement in customary form) and take all such other actions
as the holders of a majority of the Shares being sold or the managing
underwriter or underwriters retained by holders participating in an
underwritten public offering, if any, reasonably request in order to expedite
or facilitate the disposition of the Shares.
(C) The Company, if requested by the managing underwriter or
underwriters, if any, or by any holder of Shares covered by the Registration
Statement, shall promptly incorporate in a prospectus supplement or post-
effective amendment such information as the managing underwriter or
underwriters or such holder, as the case may be, reasonably requests to be
included therein, including, without limitation, information with respect to
the number of Shares being sold by such holder to any underwriter or
underwriters, the purchase price being paid therefor by such underwriter or
underwriters and with respect to any other terms of the underwritten offering
of the Shares to be sold in such offering, and promptly make all required
filings of such prospectus supplement or post-effective amendment.
(D) As promptly as practicable after filing with the Commission of any
document which is incorporated by reference in a Prospectus contained in a
Registration Statement, the Company shall deliver a copy of such documents to
each holder of Shares covered by such Registration Statement.
(E) On or prior to the date on which the Registration Statement is
declared effective, the Company shall use its best efforts to register or
qualify, and cooperate with the holders of Shares included in such
Registration Statement, the underwriter or underwriters, if any, and their
counsel, in connection with the registration or qualification of the Shares
covered by the Registration Statement for offer and sale under the securities
or blue sky laws of each state and other jurisdiction of the United States as
any such holder or underwriter reasonably requests in writing, (ii) keep each
such registration or qualification effective, including through new filings,
or amendments or renewals, during the period such Registration Statement is
required to be kept effective and (iii) do any and all other acts or things
necessary or advisable to enable the disposition in all such jurisdictions of
the Shares covered by the Registration Statement; provided that the Company
will not be required to qualify generally to do business in any jurisdiction
where it is not then so qualified or to take any action which would subject
it to general service of process in any such jurisdiction where it is not
then so subject.
(F) The Company shall cooperate with the holders of Shares covered by
the Registration Statement and the managing underwriter or underwriters, if
any, to facilitate the timely preparation and delivery of certificates (not
bearing any restrictive legends) representing Shares to be sold under the
Registration Statement, and enable such Shares to be in such denominations
and registered in such names as the managing underwriter or underwriters, if
any, or such holders may request.
(G) The Company shall use its best efforts to cause the Shares covered
by the registration statement to be registered with or approved by such
governmental agencies or authorities within the United States as may be
necessary to enable the seller or sellers thereof or the underwriter or
underwriters, if any, to consummate the disposition of such securities.
(ii) Piggyback Registrations. If the Company at any time proposes to
effect the registration of shares of its Common Stock other than in respect
of a dividend reinvestment or similar plan or on Form S-4 or S-8 or successor
forms thereto, upon the written request of the Purchaser specifying the
number of Shares to be registered, the Company shall include in such
registration all of the Purchaser's Shares so requested to be included. In
furtherance of the Purchaser's piggyback rights, at any time that the
Purchaser has the right to request piggyback registration, the Company shall
provide the Purchaser with ten days prior written notice of any registration
of Common Stock to which such piggyback rights would apply hereunder.
(iii) Amendments and Supplements. The Company agrees to (i) prepare
and file with the Commission such amendments and post-effective amendments to
any Registration Statement prepared pursuant to this Section 4(k) as may be
necessary to keep such Registration Statement continuously effective for a
period of not less than six months (or such shorter period which will
terminate when all Shares covered by such Registration Statement have been
sold or withdrawn); provided, however, that each such six-month period shall
be extended by a period to time equal to any period of time that offers and
sales of the Shares under the Registration Statement are prevented by any
stop order, injunction or other action by the Commission or any Notice of
Amendment pursuant to Section 4(e), (ii) cause the related Prospectus to be
supplemented by any required prospectus supplement, and as so supplemented to
be filed pursuant to Rule 424 under the Act, and (iii) comply with all
provisions of the Act and all provisions of this Section 4, in each instance
to the extent applicable to it with respect to the disposition of all
securities covered by such Registration Statement during the applicable
period in accordance with the intended methods of disposition by the sellers
thereof set forth in such Registration Statement or supplement to the
Prospectus.
Section 5. Representations and Warranties of the Company.
The Company represents and warrants to the Purchaser, on and as of the
Closing Date, as follows:
(a) The Registration Statement in the form in which it becomes
effective and any supplement or amendment thereto when filed with the
Commission will comply in all material respects with the applicable
provisions of the Act and the Rules and Regulations and will not at any such
times contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, except that this representation and
warranty does not apply to statements in or omissions from the Registration
Statement or the Prospectus made in reliance upon and in conformity with
information relating to any holder of Shares furnished to the Company by or
on behalf of any such holder in writing for use therein.
(b) All the Shares have been duly authorized and, when issued and
delivered to the Purchaser against payment therefor in accordance with the
terms hereof, will (i) be validly issued, fully paid and nonassessable and
free of any preemptive or similar rights and (ii) have been approved for
listing, subject to notice of issuance, on the New York Stock Exchange.
(c) The Company is a corporation duly organized and validly existing in
good standing under the laws of the State of Delaware with full power and
authority (corporate and other) to own, lease and operate its properties and
to conduct its business as currently conducted.
(d) Neither the issuance and sale of the Shares, the execution,
delivery or performance of this Agreement by the Company, nor the
consummation by the Company of the transactions contemplated hereby, (i)
requires any consent, approval, authorization or other order of or
registration or filing with, any court, regulatory body, administrative
agency or other governmental body, agency or official (except such as may be
required for the registration of the Shares under the Act and compliance with
the securities laws of various jurisdictions, which will be effected in
accordance with this Agreement) or conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under, the Restated
Certificate of Incorporation (the "Charter") or Bylaws or other
organizational documents of the Company, or (ii) conflicts or will conflict
with or constitutes or will constitute a breach of or default under, any
agreement, indenture, lease or other instrument to which the Company is a
party or by which it or any of its property may be bound, or violates or will
violate any statute, law, regulation or filing or any judgment, injunction,
order or decree applicable to the Company or any of its properties, or will
result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company pursuant to the terms of any agreement
or instrument to which it is a party or by which it may be bound or to which
any of its property or assets is subject.
(e) The execution and delivery of, and the performance by the Company
of its obligations under, this Agreement have been duly and validly
authorized by the Company, and this Agreement has been duly executed and
delivered by the Company and constitutes the valid and legally binding
agreement of the Company, enforceable against the Company in accordance with
its terms.
(f) Neither the Company nor anyone acting on its behalf has directly or
indirectly offered the Shares or any part thereof or any similar securities
for sale to, or solicited any offer to buy any of the same from, or otherwise
approached or negotiated in respect thereof with, anyone other than the
Purchaser. Neither the Company nor anyone acting on its behalf has taken or
will take any action which would subject the issuance and sale of the Shares
to the registration and prospectus delivery provisions of the Act prior to
registration of the Shares as contemplated hereby.
(g) The Company has not, and nor has anyone acting on its behalf,
employed or engaged any agent, broker or finder or incurred any liability for
any brokerage fees, commissions or finders' fees in connection with the
transactions contemplated hereby.
Section 6. Representations and Warranties of the Purchaser.
The Purchaser represents and warrants to the Company, on and as of the
Closing Date, as follows:
(a) The Purchaser has been provided an opportunity to obtain such
documents and information concerning the Company, the Shares, the Purchase
Agreement and the transactions contemplated hereby and thereby as it has
deemed appropriate in making its own analysis and financial and legal
evaluation of the Company, the Shares, the Purchase Agreement and the
transactions contemplated hereby and thereby, and the Purchaser represents
and warrants that it has, independently and based on such documents and
information as it has deemed appropriate, made its own appraisal of the
financial condition, business, creditworthiness and affairs of the Company
and of the value and terms of the Shares, this Agreement and the Purchase
Agreement.
(b) The Purchaser represents and warrants that it is acquiring the
Shares for its own account or the account of one or more separate accounts
maintained and controlled by it, for which the Purchaser has investment
discretion with respect to the acquisition of the Shares and on whose behalf
the Purchaser has authority to make this representation, in each case for
investment and not with a view to the distribution thereof or with any
present intention of distributing all or any portion thereof, all without
prejudice to its right at any time, in accordance with this Agreement,
lawfully dispose of all or any part of the Shares. The Purchaser
acknowledges and agrees that the Shares have not been registered under the
Act or any state securities law, or approved by the Commission or any state
agency, and may be resold or otherwise transferred only if registered
pursuant to the provisions of such Act and applicable state securities law or
if an exemption from registration is available.
(c) The execution and delivery of, and the performance by the
Purchaser of its obligations under, this Agreement have been duly and validly
authorized by the Purchaser, and this Agreement has been duly executed and
delivered by the Purchaser and constitutes the valid and legally binding
agreement of the Purchaser, enforceable against the Purchaser in accordance
with its terms.
(d) The Purchaser represents that it is an "accredited investor" as
such term is defined in Regulation D under the Act, is financially able to
bear the risks of the investment in the Shares and has such knowledge and
experience in financial and business matters that it is capable of evaluating
the merits and risks thereof.
(e) The Purchaser has not, and nor has anyone acting on the Purchaser's
behalf, employed or engaged any agent, broker or finder (other than Fearnley
Offshore as provided in the Purchase Agreement) or incurred any liability for
any brokerage fees, commission or finders' fees (other than to Fearnley
Offshore as provided in the Purchase Agreement) in connection with the
transactions contemplated hereby.
(f) The information set forth in the Holder Questionnaire of the
Purchaser is true and complete in all material respects and may be used by
the Company in a Registration Statement until updated or revised by written
notice to the Company by the Purchaser.
Section 7. Indemnification.
(a) In connection with the Registration Statement, the Company agrees
to indemnify and hold harmless each holder of securities covered thereby, the
directors, officers, employees and agents of each holder and each person who
controls any holder within the meaning of the Act or the Exchange Act against
any and all losses, claims, damages or liabilities, joint or several, to
which they or any of them may become subject under the Act, the Exchange Act
or other Federal or state statutory laws or regulations, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement as originally filed or in any amendment thereof, or in any
preliminary Prospectus or Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, that (i) the Company will not
be liable to the extent that any such loss, claim, damage or liability arises
out of or is based upon any such untrue statement or alleged untrue statement
or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by or on behalf
of any such holder specifically for inclusion therein and (ii) such indemnity
with respect to any Prospectus shall not inure to the benefit of any holder
(or any director, officer, employee or agent of such holder or any person
controlling such holder) from whom the person asserting any such loss, claim,
damage or liability purchased the Shares if such person did not receive a
copy of the current Prospectus as amended and supplemented and distributed to
the holders by the Company at or prior to the confirmation of the sale of
such Shares, to such person in any case where such delivery is required by
the Securities Act and the untrue statement or omission of a material fact
contained in the Prospectus was corrected in such current Prospectus as so
amended and supplemented. This indemnity agreement will be in addition to
any liability which the Company may otherwise have.
(b) Each holder of Shares covered by the Registration Statement
severally agrees to indemnify and hold harmless (i) the Company, (ii) each of
its directors, (iii) each of its officers who signs the Registration
Statement and (iv) each person who controls the Company within the meaning of
either the Act or the Exchange Act to the same extent as the foregoing
indemnity from the Company to each holder, but only with reference to written
information relating to such holder furnished to the Company on or behalf of
such holder specifically for inclusion in the Registration Statement or the
Prospectus. This indemnity agreement will be in addition to any liability
which any holder may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
7 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under this Section 7, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless
and to the extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party
shall be entitled to appoint counsel of the indemnifying party's choice at
the indemnifying party's expense to represent the indemnified party in any
action for which indemnification is sought (in which case the indemnifying
party shall not thereafter be responsible for the fees and expenses of any
separate counsel retained by the indemnified party or parties except as set
forth below); provided, that such counsel shall be reasonably satisfactory to
the indemnified party. Notwithstanding the indemnifying party's election to
appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ separate counsel at the
expense of the indemnifying party, if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the actual or potential defendants
in, or targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it or any other indemnified
party which are different from or additional to those available to the
indemnifying party, (iii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the institution of
such action or (iv) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying party.
An indemnifying party will not, without the prior written consent of the
indemnified parties, settle, compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b)
above is unavailable to or insufficient to hold harmless an indemnified party
for any reason, then each indemnifying party, in lieu of indemnifying such
indemnified party, shall have a joint and several obligation to contribute to
the aggregate losses, claims, damages and liabilities (collectively "Losses")
to which such indemnified party shall be subject in such proportion as is
appropriate to reflect the relative fault of such indemnifying party, on the
one hand, and such indemnified party, on the other hand, in connection with
the statements or omissions which resulted in such Losses as well as any
other relevant equitable considerations. The relative fault of such
indemnifying party and indemnified party shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission
to state a material fact, has been made by, or relates to information
supplied by, such indemnifying party or indemnified party, and the parties'
relative intent, knowledge, access to information and opportunity to correct
or prevent such action. The amount paid or payable by a party as a result of
the Losses referred to above shall be deemed to include, subject to the
limitations set forth in Section 7(c), any legal or other fees or expenses
reasonably incurred by such party in connection with any investigation or
proceeding. The parties hereto agree that it would not be just and equitable
if contribution pursuant to this Section 7(d) were determined by pro rata
allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in this paragraph.
No person guilty of fraudulent misrepresentation shall be entitled to
contribution from any person not guilty thereof.
Section 8. Rule 144.
The Company covenants that it will file the reports required to be
filed by it under the Act, the Exchange Act and the rules and regulations
thereunder or, if the Company is not required to file such reports, it will,
upon the request of any holder of Shares, make publicly available other
information so long as necessary to permit sales under Rule 144 under the
Act, and it will take such further action as any holder of Shares may
reasonably request all to the extent required from time to time to enable
such holder to sell Shares without registration under the Act within the
limitation of the exemptions provided by (i) Rule 144 under the Act, as such
Rule may be amended from time to time, or (ii) any similar rule or regulation
hereafter adopted by the Commission. Upon the request of any holder of
Shares, the Company will deliver to such holder a written statement as to
whether it has complied with such requirements.
Section 9. Miscellaneous.
(a) This Agreement shall be binding on, and inure to the benefit of,
the parties hereto and their respective successors and permitted assigns
pursuant to Section 3(c)(i) and (d) hereof.
(b) This Agreement may be signed in counterparts, each of which shall
be an original and which taken together shall constitute one agreement. This
Agreement and any modification or waiver hereof may be executed by facsimile
signature.
(c) This Agreement may be modified, waived, discharged or terminated
only by an instrument in writing signed by the Company and holders of a
majority of the Shares (without counting for such purposes Shares held by the
Company or its affiliates).
(d) All notices and other communications hereunder shall be in writing
and shall be served either (i) personally, (ii) by certified mail, (iii) by
overnight courier service, or (iv) by telecopier, in each case addressed to
the party to whom notice is being given at its address as set forth below or
at such other address as may hereafter be designated in writing by either
party hereto. All such notices or other communications shall be deemed to
have been given on (i) the date received if delivered personally, (ii) five
business days after the date of posting if transmitted by certified mail,
(iii) the first business day after receipt by the overnight courier service,
or (iv) the date of transmission with confirmation answerback if transmitted
by telecopier. Said parties may designate in writing from time to time other
and additional places to which notices may be sent.
All notices to the Company shall be given to it at:
READING & ▇▇▇▇▇ CORPORATION
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Copy to:
Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
All notices to holders of Shares shall be given at the address set
forth for the Purchaser in the Purchase Agreement, the Purchaser's Holder
Questionnaire or otherwise indicated in writing to the Company by any such
holder.
(e) Damages in the event of breach of this Agreement would be
difficult, if not impossible, to ascertain, and it is therefore agreed that
each party hereto, in addition to and without limiting any other remedy or
right it may have, will have the right to an injunction or other equitable
relief in any court of competent jurisdiction, enjoining any such breach, and
enforcing specifically the terms and provisions hereof. The existence of this
right will not preclude the parties hereto from pursuing any other rights and
remedies at law or in equity which they may have.
(f) If any provision of this Agreement is held to be illegal, invalid
or unenforceable, and if the rights or obligations of any party hereto will
not be materially and adversely affected thereby, (i) such provision will be
fully severable, (ii) this Agreement will be construed and enforced as if
such illegal, invalid or unenforceable provision had never comprised a part
hereof, (iii) the remaining provisions of this Agreement will remain in full
force and effect and will not be affected by the illegal, invalid or
unenforceable provision or by its severance herefrom and (iv) in lieu of such
illegal, invalid or unenforceable provision, there will be added
automatically as a part of this Agreement a legal, valid and enforceable
provision as similar in terms to such illegal, invalid or unenforceable
provision as may be possible.
(g) The terms and provisions of this Agreement are intended solely for
the benefit of each party hereto and their respective successors and, in the
case of holders of Shares, permitted assigns pursuant to Section 3(c)(i) and
(d) hereof, and is not the intention of the parties to confer third-party
beneficiary rights upon any other person.
(h) Except as otherwise expressly provided in this Agreement, each
party will pay its own costs and expenses.
(i) DeepFlex Production Partners L.P. hereby instructs the Company, at
the closing contemplated by the Purchase Agreement, to issue all of the
Shares in the name of DeepFlex Production Systems, Inc., an affiliate of
DeepFlex Production Partners L.P. For purposes of this Agreement, including
but not limited to Sections 4 and 6, the term "Purchaser" shall include both
DeepFlex Production Partners L.P. and DeepFlex Production Systems, Inc. The
Company agrees to cause the Shares to be registered in the name of DeepFlex
Production Systems, Inc., and Deepflex Production Systems, Inc. hereby agrees
to take the Shares at the closing contemplated by the Purchase Agreement
subject to all of the terms and provisions of this Agreement.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement
as of the date above first written.
Company:
READING & ▇▇▇▇▇ CORPORATION
By: ____________________________
Name:
Title:
Purchaser:
DEEPFLEX PRODUCTION PARTNERS L.P.
By: DEEPFLEX HOLDINGS L.L.C.
Title: General Partner
By: ____________________
Name:
Title:
Acknowledged and Agreed:
DEEPFLEX PRODUCTION SYSTEMS, INC.
By: ___________________________
Name:
Title:
EXHIBIT A
HOLDER QUESTIONNAIRE
Holder Questionnaire pursuant to the Common Stock Issuance Agreement
dated as of August 31, 1995 among READING & ▇▇▇▇▇ CORPORATION and DEEPTECH
PRODUCTION PARTNERS, L.P. (the "Agreement"). Each capitalized term used
herein without definition shall have the meaning ascribed thereto in the
Agreement.
Please complete, execute, date and return to:
Reading & ▇▇▇▇▇ Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
The information requested below is required for purposes of any
Registration Statement in which any Holder participates, and for purposes of
certain Exchange Act filings. THE UNDERSIGNED HOLDER AGREES TO UPDATE AND
AMEND THIS QUESTIONNAIRE IF THERE IS ANY MATERIAL CHANGE IN THE INFORMATION
CONTAINED HEREIN AND TO PROVIDE ANY ADDITIONAL INFORMATION REQUESTED BY THE
COMPANY PURSUANT TO SECTION 4(e) OF THE AGREEMENT.
Information for notices:
Legal Name of Holder : ________________________________
Street Address : _______________________________________
Post Office Box : ______________________________________
City/State/Zip : _______________________________________
Fed. Tax ID. No. (if any) : ___________________________
Telex Number: _____________ Answerback__________________
Telecopier Number: ________ Type of Telecopier: ________
Contacts: (Please include Back-ups)
1. Name:_____________________________________________
Title:____________________________________________
Function:_________________________________________
Business Telephone:_______________________________
Home Telephone:___________________________________
2. Name:_____________________________________________
Title:____________________________________________
Function:_________________________________________
Business Telephone:_______________________________
Home Telephone:___________________________________
Information required for any Registration Statement and Prospectus
pursuant to Item 507 of Regulation S-K under the Securities Act:
1. Describe the nature of any position, office or other material
relationship (excluding normal banking relationships) which such Holder has
had within the past three years with the Company or any of its affiliates.
2. Enter below in the space indicated the number of shares of Common
Stock or other securities of Reading & ▇▇▇▇▇ Corporation convertible into or
exchangeable or exercisable for Common Stock owned as of the date of this
certificate (i) by the Holder signing this certificate for its own account
and (ii) in the aggregate by affiliates (as defined in Exchange Act Rule
12b-2) of such Holder for their own accounts (excluding, in each case, any
Common Stock or other securities of Reading & ▇▇▇▇▇ Corporation convertible
into or exchangeable or exercisable for Common Stock held by the Holder or
its affiliates in investment accounts, in trust accounts, in custody accounts
or in other similar fiduciary capacities).
Holder Affiliates
________ __________ Shares of Common Stock
________ __________ Other convertible or exchangeable securities (Specify
title of class or series and number of shares of
Common Stock underlying such securities)
The undersigned Holder hereby represents that the information contained
herein is true and complete in all material respects as of the date hereof,
and agrees to supplement this Holder Questionnaire upon the request of the
Company and to update and amend this Holder Questionnaire if there is any
material change in the information contained herein. The undersigned Holder
hereby authorizes the Company to use the information contained herein in any
registration statement or prospectus filed by the Company pursuant to the
Agreement and to rely upon the information contained herein, until this
Holder Questionnaire is amended or withdrawn, in executing any certificate,
agreement or document contemplated by the Agreement.
IN WITNESS WHEREOF the undersigned has duly executed this document as
of the date set forth below.
______________________________________
Name of Holder
By __________________________________
Signature of Authorized Signatory
_______________________________________
Printed Name of Authorized Signatory
_______________________________________
Title
_______________________________________
Date
COMPANY USE ONLY
Date Received _________________________