REGISTRATION RIGHTS AGREEMENT BETWEEN ADVANCED BIOENERGY, LLC AND HAWKEYE ENERGY HOLDINGS, LLC August 28, 2009
Exhibit 4.4
August 28, 2009
TABLE OF CONTENTS
| Page | ||||||||
| 1. | Definitions | 1 | ||||||
| 2. | Registration Rights | 4 | ||||||
| 2.1 | Demand Registration | 4 | ||||||
| 2.2 | Company Registration | 6 | ||||||
| 2.3 | Underwriting Requirements | 6 | ||||||
| 2.4 | Obligations of the Company | 7 | ||||||
| 2.5 | Furnish Information | 9 | ||||||
| 2.6 | Expenses of Registration | 9 | ||||||
| 2.7 | Indemnification | 9 | ||||||
| 2.8 | Reports Under Exchange Act | 12 | ||||||
| 2.9 | Limitations on Subsequent Registration Rights | 12 | ||||||
| 2.10 | “Market Stand-off” Agreement | 13 | ||||||
| 2.11 | Restrictions on Transfer | 13 | ||||||
| 2.12 | Termination of Registration Rights | 15 | ||||||
| 3. | Miscellaneous | 15 | ||||||
| 3.1 | Successors and Assigns | 15 | ||||||
| 3.2 | Governing Law | 15 | ||||||
| 3.3 | Counterparts; Facsimile | 15 | ||||||
| 3.4 | Titles and Subtitles | 15 | ||||||
| 3.5 | Notices | 15 | ||||||
| 3.6 | Amendments and Waivers | 16 | ||||||
| 3.7 | Severability | 17 | ||||||
| 3.8 | Aggregation of Securities | 17 | ||||||
| 3.9 | Entire Agreement | 17 | ||||||
| 3.10 | Delays or Omissions | 17 | ||||||
i
This
Registration Rights Agreement (this “Agreement”) is
made as of the 28th day of
August, 2009, between Advanced BioEnergy, LLC, a Delaware limited liability company (the
“Company”), and Hawkeye Energy Holdings, LLC, a Delaware limited liability company (“Hawkeye”).
Background
A. On the date hereof, the Company and Hawkeye entered into that certain Subscription
Agreement (the “Subscription Agreement”) and letter agreement (the “Subscription Letter Agreement”
and together with the Subscription Agreement, the “Subscription Documents”) providing for the
issuance and sale of Units to Hawkeye.
B. In connection with the Subscription Documents the Parties desire to provide Hawkeye with
the right, among other rights, to demand the registration of Registrable Securities (as defined
below) held by Hawkeye in accordance with the terms of this Agreement. Capitalized terms used
herein but not otherwise defined have the meaning given to them in the Subscription Documents.
Agreement
NOW, THEREFORE, in consideration of the foregoing and the mutual promises contained herein,
the Parties agree as follows:
1. Definitions. For purposes of this Agreement:
1.1 “Affiliate” means, with respect to any specified Person, any other Person who or which,
directly or indirectly, controls, is controlled by, or is under common control with such specified
Person, including without limitation any general partner, officer, director, or manager of such
Person.
1.2 “Damages” means any loss, damage, or liability to which a party hereto may become subject
under the Securities Act, the Exchange Act, or other federal or state law, insofar as such loss,
damage, or liability (or any action in respect thereof) arises out of or is based upon (a) any
untrue statement or alleged untrue statement of a material fact contained in any registration
statement of the Company, including any preliminary prospectus or final prospectus contained
therein or any amendments or supplements thereto; (b) an omission or alleged omission to state
therein a material fact required to be stated therein, or necessary to make the statements therein
not misleading; or (c) any violation or alleged violation by the indemnifying party (or any of its
agents or Affiliates) of the
Securities Act, the Exchange Act, any state securities law, or any
rule or regulation promulgated under the Securities Act, the Exchange Act, or any state securities
law.
1.3 “Derivative Securities” means any securities or rights convertible into, or exercisable or
exchangeable for (in each case, directly or indirectly), Units, including options and warrants.
1.4 “EIP” means Ethanol Investment Partners, LLC.
1.5 “EIP Holder” means any “Holder” as that term is defined under the EIP Registration Rights
Agreement.
1.6 “EIP Registration Rights Agreement” means that certain Registration Rights Agreement dated
as of June 2, 2007 between the Company and EIP.
1.7 “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.
1.8 “Excluded Registration” means (a) a registration relating to the sale of securities to
employees of the Company or a subsidiary pursuant to a stock option, stock purchase, or similar
plan or (b) a registration relating to an SEC Rule 145 transaction.
1.9 “Form S-1” means such form under the Securities Act as in effect on the date hereof or any
successor registration form under the Securities Act subsequently adopted by the SEC.
1.10 “Form S-2” means such form under the Securities Act as in effect on the date hereof or
any successor registration form under the Securities Act subsequently adopted by the SEC.
1.11 “Form S-3” means such form under the Securities Act as in effect on the date hereof or
any registration form under the Securities Act subsequently adopted by the SEC that permits
incorporation of substantial information by reference to other documents filed by the Company with
the SEC.
1.12 “GAAP” means generally accepted accounting principles in the United States.
1.13 “Holder” means any holder of Registrable Securities who is a party to this Agreement,
including permitted transferees that agree in writing to be bound by and subject to the terms and
conditions of this Agreement.
1.14 “Initiating Holders” means, collectively, Holders who properly initiate a registration
request under this Agreement.
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1.15 “IPO” means the Company’s first underwritten public offering of its Units or other equity
securities under the Securities Act after the date of this Agreement.
1.16 “Operating Agreement” means that certain Third Amended and Restated Operating Agreement
of the Company dated as of February 1, 2006, as may be amended from time to time.
1.17 “Person” means any individual, corporation, partnership, trust, limited liability
company, association or other entity.
1.18 “Registrable Securities” means (a) the Units beneficially owned by Hawkeye from time to
time; and (b) any Units issued as (or issuable upon the conversion or exercise of any warrant,
right, or other security that is issued as) a dividend or other distribution with respect to, or in
exchange for or in replacement of, the Units referenced in clause (a) above, including without
limitation any Units which are issued to Hawkeye subsequent to the conversion resulting from any
stock split or merger, and excluding in all cases, however, any Registrable Securities sold by a
Person in a transaction in which the applicable rights under this Agreement are not assigned
pursuant to Section 3.1, and excluding for purposes of Section 2 any Units for which registration
rights have terminated pursuant to Section 2.12 of this Agreement.
1.19 “Restricted Securities” means the securities of the Company required to bear the legend
set forth in Section 2.11(b) hereof.
1.20 “SDWG” means South Dakota Wheat Growers Association, a South Dakota cooperative.
1.21 “SDWG Holder” means any “Holder” as that term is defined under the SDWG Investor Rights
Agreement.
1.22 “SDWG Investor Rights Agreement” means that certain Investor Rights Agreement dated as of
November 8, 2006 between the Company and SDWG, as amended.
1.23 “SEC” means the Securities and Exchange Commission.
1.24 “SEC Rule 144” means Rule 144 promulgated by the SEC under the Securities Act.
1.25 “SEC Rule 145” means Rule 145 promulgated by the SEC under the Securities Act.
1.26 “Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
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1.27 “Selling Expenses” means all underwriting discounts, selling commissions, and stock
transfer taxes applicable to the sale of Registrable Securities, and fees and disbursements of
counsel for any Holder, except for the fees and disbursements of the Selling Holder Counsel borne
and paid by the Company as provided in Section 2.6.
1.28 “Units” means units of membership interests in the Company, or shares or other equity
interests of the Company issued in exchange for or otherwise in connection with any transaction as
described in Section 2.1.
2. Registration Rights. The Company covenants and agrees as follows:
2.1 Demand Registration.
(a) Form S-1 Demand. If at any time after the earlier of (i) one year after the date
of this Agreement or (ii) ninety (90) days after the effective date of the registration statement
for the IPO or such longer period after the IPO if the Holders cannot sell their securities as a
result of executing a “market stand-off” agreement contemplated by Section 2.10 hereof, the Company
receives a request from Holders of at least seventy-five percent (75%) of the Registrable
Securities that the Company file a Form S-1 registration statement with respect to at least
seventy-five percent (75%) of the Registrable Securities (or any lesser percentage if the
anticipated aggregate offering price, net of Selling Expenses, would exceed $15 million), then the
Company shall (x) within ten (10) days after the date such request is given, give notice thereof
(the “Demand Notice”) to all Holders other than the Initiating Holders (including for purposes of
this Section 2.1(a), solely for purposes of this clause (x), any EIP Holder and any SDWG Holder);
and (y) as soon as practicable, and in any event within forty-five (45) days after the date such
request is given by the Initiating Holders, file a Form S-1 registration statement under the
Securities Act covering all Registrable Securities that the Initiating Holders requested to be
registered and any additional Registrable Securities requested to be included in such registration
by any other Holders (including for purposes of this Section 2.1(a), solely for purposes of this
clause (y), any EIP Holder and any SDWG Holder), as specified by notice given by each such Holder
to the Company within twenty (20) days of the date the Demand Notice is given, and in each case,
subject to the limitations of Section 2.1(c) and Section 2.3.
(b) Form S-3 Demand. If at any time when it is eligible to use a Form S-3
registration statement, the Company receives a request from Holders of at least fifty percent (50%)
of the Registrable Securities that the Company file a Form S-3 registration statement with respect
to at least fifty percent (50%) of the Registrable Securities (or any lesser percentage if the
anticipated aggregate offering price, net of Selling Expenses, would exceed $15 million), then the
Company shall (i) within ten (10) days after the date such request is given, give a Demand Notice
to all Holders other than the Initiating Holders (including for purposes of this Section 2.1(b),
solely for purposes of this clause (i), any EIP Holder and any SDWG Holder); and (ii) as soon as
practicable, and in any event within forty-five (45) days after the date such request is given by
the Initiating Holders, file a Form S-3 registration statement under the Securities Act covering
all Registrable Securities requested to be included in such registration by any other Holders
(including for purposes of this Section 2.1(b), solely for purposes of this clause (ii), any EIP
Holder and any SDWG Holder), as specified by notice given by each such Holder to the
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Company within
twenty (20) days of the date the Demand Notice is given, and in each case, subject to the
limitations of Section 2.1(c) and Section 2.3.
(c) Notwithstanding the foregoing obligations, if the Company furnishes to Holders requesting
a registration pursuant to Section 2.1(a) or Section 2.1(b) a certificate signed by the Company’s
chief executive officer stating that in the good faith judgment of the Board it
would be materially detrimental to the Company and its members for such registration statement
to either become effective or remain effective for as long as such registration statement otherwise
would be required to remain effective, because such action would (i) materially interfere with a
significant acquisition, corporate reorganization, or other similar transaction involving the
Company; or (ii) require premature disclosure of material information that the Company has a bona
fide business purpose for preserving as confidential; and it is therefore necessary to defer the
filing of such registration statement, then the Company shall have the right to defer taking action
with respect to such filing, and any time periods with respect to filing or effectiveness thereof
shall be tolled correspondingly, for a period of not more than thirty (30) days after the request
of the Initiating Holders is given; provided, however, that the Company may not invoke this right
more than once in any twelve (12) month period; and provided further that the Company shall not
register any securities for its own account or that of any other member during such thirty (30) day
period other than an Excluded Registration.
(d) The Company shall not be obligated to effect, or to take any action to effect, any
registration pursuant to Section 2.1(a): (i) during the period that is thirty (30) days before the
Company’s good faith estimate of the date of filing of, and ending on a date that is ninety (90)
days after the effective date of, a Company-initiated registration, provided, that the Company is
actively employing in good faith commercially reasonable efforts to cause such registration
statement to become effective; (ii) after the Company has effected two registrations pursuant to
Section 2.1(a); or (iii) if the Initiating Holders propose to dispose of shares of Registrable
Securities that may be immediately registered on Form S-3 pursuant to a request made pursuant to
Section 2.1(b). The Company shall not be obligated to effect, or to take any action to effect, any
registration pursuant to Section 2.1(b): (x) during the period that is thirty (30) days before the
Company’s good faith estimate of the date of filing of, and ending on a date that is ninety (90)
days after the effective date of, a Company-initiated registration, provided, that the Company is
actively employing in good faith commercially reasonable efforts to cause such registration
statement to become effective; or (y) if the Company has effected two registrations pursuant to
Section 2.1(b) within the twelve (12) month period immediately preceding the date of such request.
A registration shall not be counted as “effected” for purposes of this Section 2.1(d) until such
time as the applicable registration statement has been declared effective by the SEC, unless the
Company has performed its obligations hereunder in all material respects, the Initiating Holders
withdraw their request for such registration, the Initiating Holders elect not to pay the
registration expenses therefor, and the Initiating Holders forfeit their right to one demand
registration statement pursuant to Section 2.6, in which case such withdrawn registration statement
shall be counted as “effected” for purposes of this Section 2.1(d).
2.2 Company Registration. If the Company proposes to register (including, for this
purpose, a registration effected by the Company for equity holders other than the Holders,
including, without limitation, pursuant to the EIP Registration Rights Agreement or the
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SDWG
Investor Rights Agreement) any of its securities under the Securities Act in connection with the
public offering of such securities solely for cash (other than in an Excluded Registration), the
Company shall, at such time, promptly give each Holder notice of such registration. Upon the
request of each Holder given within twenty (20) days after such notice is given by the Company, the
Company shall, subject to the provisions of Section 2.3, cause to be registered all of the
Registrable Securities that each such Holder has requested to be included in such registration.
The Company shall have the right to terminate or withdraw any registration
initiated by it under this Section 2.2 before the effective date of such registration, whether
or not any Holder has elected to include Registrable Securities in such registration. The expenses
(other than Selling Expenses) of such withdrawn registration shall be borne by the Company in
accordance with Section 2.6.
2.3 Underwriting Requirements.
(a) If, pursuant to Section 2.1, the Initiating Holders intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall so advise the Company
as a part of their request made pursuant to Section 2.1, and the Company shall include such
information in the Demand Notice. The underwriter(s) will be selected by the Company and shall be
reasonably acceptable to a majority in interest of the Initiating Holders. In such event, the
right of any Holder to include such Holder’s Registrable Securities in such registration shall be
conditioned upon such Holder’s participation in such underwriting and the inclusion of such
Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders
proposing to distribute their securities through such underwriting shall (together with the Company
as provided in Section 2.4(e)) enter into an underwriting agreement in customary form with the
underwriter(s) selected for such underwriting. Notwithstanding any other provision of this Section
2.3, if the underwriter(s) advise(s) the Initiating Holders in writing that marketing factors
require a limitation on the number of equity securities to be underwritten, then the Initiating
Holders shall so advise all Holders of Registrable Securities that otherwise would be underwritten
pursuant hereto, and the number of equity securities that may be included in the underwriting shall
be allocated as follows: (1) as between the Holders of Registrable Securities that are party to
this Agreement (the “Hawkeye Holders”), the EIP Holders and the SDWG Holders in proportion (as
nearly as practicable) to the number of equity securities that each group requested to be included
in the underwriting, and then (2) as between the persons that comprise the Hawkeye Holders, the EIP
Holders and the SDWG Holders in proportion (as nearly as practicable) to the number of equity
securities owned by each holder or in such other proportion as shall mutually be agreed to by all
such holders; provided, however, that the number of Registrable Securities held by the Hawkeye
Holders to be included in such underwriting shall not be reduced unless all other securities,
except the equity securities requested to be included in the underwriting by the EIP Holders and
the SDWG Holders which shall be reduced as contemplated in the prior sentence, are first entirely
excluded from the underwriting.
(b) In connection with any offering involving an underwriting of the Company’s securities
pursuant to Section 2.2, the Company shall not be required to include any of the Holders’
Registrable Securities in such underwriting unless the Holders accept the terms of the underwriting
agreement as agreed upon between the Company and its underwriters (which underwriting agreement
shall contain customary terms and conditions), and then only in such
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quantity as the underwriters
in their reasonable discretion determine will not jeopardize the success of the offering by the
Company. If the total number of securities, including Registrable Securities, requested by
security holders of the Company to be included in such offering exceeds the number of securities to
be sold (other than by the Company) that the underwriters in their reasonable discretion determine
is compatible with the success of the offering, then the Company shall be required to include in
the offering only that number of such securities, including Registrable Securities, which the
underwriters in their reasonable discretion determine will not jeopardize the success of the
offering. If the underwriters determine that less than all of the
Registrable Securities requested to be registered can be included in such offering, then the
Registrable Securities that are included in such offering shall be allocated among the selling
Holders in proportion (as nearly as practicable to) the number of Registrable Securities owned by
each selling Holder or in such other proportions as shall mutually be agreed to by all such selling
Holders; provided, however, in no event shall any securities held by any SDWG Holder be eliminated
unless all Registrable Securities held by all EIP Holders and all Hawkeye Holders are completely
eliminated. For purposes of the provision in this Section 2.3(b) concerning apportionment, for any
selling Holder that is a partnership, limited liability company, or corporation, the partners,
members, retired partners, retired members, stockholders, and Affiliates of such Holder, shall be
deemed to be a single “selling Holder,” and any pro rata reduction with respect to such “selling
Holder” shall be based upon the aggregate number of Registrable Securities owned by all Persons
included in such “selling Holder” as defined in this sentence.
(c) For purposes of Section 2.1, a registration shall not be counted as “effected” if, as a
result of an exercise of the underwriter’s cutback provisions in Section 2.3, fewer than fifty
percent (50%) of the total number of Registrable Securities that Holders have requested to be
included in such registration statement are actually included.
2.4 Obligations of the Company. Whenever required under this Section 2 to effect the
registration of any Registrable Securities, the Company shall, as expeditiously as reasonably
possible:
(a) prepare and file with the SEC a registration statement with respect to such Registrable
Securities and use its commercially reasonable efforts to cause such registration statement to
become effective and, upon the request of the Holders of a majority of the Registrable Securities
registered thereunder, keep such registration statement effective for a period of up to one hundred
eighty (180) days or, if earlier, until the distribution contemplated in the registration statement
has been completed; provided, however, that (i) such one hundred eighty (180) day period shall be
extended for a period of time equal to the period the Holder refrains, at the request of the
Company or an underwriter of Units (or other securities) of the Company, from selling any
securities included in such registration, and (ii) in the case of any registration of Registrable
Securities on Form S-3 that are intended to be offered on a continuous or delayed basis, subject to
compliance with applicable SEC rules, such one hundred eighty (180) day period shall be extended
for up to two hundred forty (240) days, if necessary, to keep the registration statement effective
until all such Registrable Securities are sold;
| Advanced BioEnergy LLC — Hawkeye Registration Rights Agreement | Page 7 | |
(b) prepare and file with the SEC such amendments and supplements to such registration
statement, and the prospectus used in connection with such registration statement, as may be
necessary to comply with the Securities Act in order to enable the disposition of all securities
covered by such registration statement;
(c) furnish to the selling Holders such numbers of copies of a prospectus, including a
preliminary prospectus, as required by the Securities Act, and such other documents as the Holders
may reasonably request in order to facilitate their disposition of their Registrable Securities;
(d) use its commercially reasonable efforts to register and qualify the securities covered by
such registration statement under such other securities or blue-sky laws of such jurisdictions as
shall be reasonably requested by the selling Holders; provided that the Company shall not be
required to qualify to do business or to file a general consent to service of process in any such
states or jurisdictions, unless the Company is already subject to service in such jurisdiction and
except as may be required by the Securities Act;
(e) in the event of any underwritten public offering, enter into and perform its obligations
under an underwriting agreement, in usual and customary form, with the underwriter(s) of such
offering;
(f) use its commercially reasonable efforts to cause all such Registrable Securities covered
by such registration statement to be listed on a national securities exchange or trading system and
each securities exchange and trading system (if any) on which similar securities issued by the
Company are then listed;
(g) provide a transfer agent and registrar for all Registrable Securities registered pursuant
to this Agreement and provide a CUSIP number for all such Registrable Securities, in each case not
later than the effective date of such registration;
(h) promptly make available for inspection by the selling Holders, any underwriter(s)
participating in any disposition pursuant to such registration statement, and any attorney or
accountant or other agent retained by any such underwriter or selected by the selling Holders, all
financial and other records, pertinent corporate documents, and properties of the Company, and
cause the Company’s officers, directors, employees, and independent accountants to supply all
information reasonably requested by any such seller, underwriter, attorney, accountant, or agent,
in each case, as necessary or advisable to verify the accuracy of the information in such
registration statement and to conduct appropriate due diligence in connection therewith;
(i) notify each selling Holder, promptly after the Company receives notice thereof, of the
time when such registration statement has been declared effective or a supplement to any prospectus
forming a part of such registration statement has been filed; and
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(j) after such registration statement becomes effective, notify each selling Holder of any
request by the SEC that the Company amend or supplement such registration statement or prospectus.
2.5 Furnish Information. It shall be a condition precedent to the obligations of the
Company to take any action pursuant to Section 2 with respect to the Registrable Securities of any
selling Holder that such Holder shall furnish to the Company such information regarding itself, the
Registrable Securities held by it, and the intended method of disposition of such securities as is
reasonably required to effect the registration of such Holder’s Registrable Securities.
2.6 Expenses of Registration. All expenses (other than Selling Expenses) incurred in
connection with registrations, filings, or qualifications pursuant to Section 2, including all
registration, filing, and qualification fees; printers’ and accounting fees; fees and
disbursements of counsel for the Company; and the reasonable fees and disbursements of one
counsel for the selling Holders (“Selling Holder Counsel”), shall be borne and paid by the Company;
provided, however, that the Company shall not be required to pay for any expenses of any
registration proceeding begun pursuant to Section 2.1(a) or Section 2.1(b) if the registration
request is subsequently withdrawn at the request of the Holders of a majority of the Registrable
Securities to be registered (in which case all selling Holders, including the EIP Holders and the
SDWG Holders, shall bear such expenses pro rata based upon the number of Registrable Securities
that were actually to be included in the withdrawn registration), unless the Holders of a majority
of the Registrable Securities agree to forfeit their right to one registration pursuant to Section
2.1(a) or Section 2.1(b), as the case may be; provided further that if, at the time of such
withdrawal, the Holders have learned of a material adverse change in the condition, business, or
prospects of the Company from that known to the Holders at the time of their request and have
withdrawn the request with reasonable promptness after learning of such information, then the
Holders shall not be required to pay any of such expenses and shall not forfeit their right to one
registration pursuant to Section 2.1(a) or Section 2.1(b). All Selling Expenses relating to
Registrable Securities registered pursuant to Section 2 shall be borne and paid by the Holders pro
rata on the basis of the number of Registrable Securities registered on their behalf.
2.7 Indemnification. If any Registrable Securities are included in a registration
statement under this Section 2:
(a) To the extent permitted by law, the Company will indemnify and hold harmless each selling
Holder, and the partners, members, officers, directors, employees, agents and stockholders of each
such Holder; legal counsel, accountants and other advisors for each such Holder; any underwriter
(as defined in the Securities Act) for each such Holder; and each Person, if any, who controls such
Holder or underwriter within the meaning of the Securities Act or the Exchange Act, against any
Damages, and the Company will pay to each such Holder, underwriter, controlling Person, or other
aforementioned Person any legal or other expenses reasonably incurred thereby in connection with
investigating or defending any claim or proceeding from which Damages may result, as such expenses
are incurred; provided, however, that the indemnity agreement contained in this Section 2.7(a)
shall not apply to amounts paid in settlement of any such claim or proceeding if such settlement is
effected without the consent of
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the Company, which consent shall not be unreasonably withheld, nor
shall the Company be liable for any Damages to the extent that they arise out of or are based upon
actions or omissions made in reliance upon and in strict conformity with written information
furnished by or on behalf of any such Holder, underwriter, controlling Person, or other
aforementioned Person expressly for use in such registration statement.
(b) To the extent permitted by law, each selling Holder, severally and not jointly, will
indemnify and hold harmless the Company, and each of its directors, each of its officers who has
signed the registration statement, each Person (if any), who controls the Company within the
meaning of the Securities Act, legal counsel, accountants and other advisors for the Company, any
underwriter (as defined in the Securities Act), any other Holder selling securities in such
registration statement, and any controlling Person of any such underwriter or other Holder, against
any Damages, in each case only to the extent that such Damages arise out of or are based upon
actions or omissions made in reliance upon and in strict conformity with written information
furnished by or on behalf of such selling Holder expressly for use in such
registration statement; and each such selling Holder will pay, severally and not jointly, to
the Company and each other aforementioned Person any legal or other expenses reasonably incurred
thereby in connection with investigating or defending any claim or proceeding from which such
indemnifiable Damages may result, as such expenses are incurred; provided, however, that the
indemnity agreement contained in this Section 2.7(b) shall not apply to amounts paid in settlement
of any such claim or proceeding if such settlement is effected without the consent of the Holder,
which consent shall not be unreasonably withheld; and provided further that in no event shall any
indemnity under this Section 2.7(b) exceed the net proceeds from the offering received by such
Holder, except in the case of common law fraud or willful misconduct by such Holder.
(c) Promptly after receipt by an indemnified party under this Section 2.7 of notice of the
commencement of any action (including any governmental action) for which a party may be entitled to
indemnification hereunder, such indemnified party will, if a claim in respect thereof is to be made
against any indemnifying party under this Section 2.7, give the indemnifying party notice of the
commencement thereof. The indemnifying party shall have the right to participate in such action
and, to the extent the indemnifying party so desires, participate jointly with any other
indemnifying party to which notice has been given, and to assume the defense thereof with counsel
mutually satisfactory to the parties; provided, however, that an indemnified party (together with
all other indemnified parties that may be represented without conflict by one counsel) shall have
the right to retain one separate counsel, with the fees and expenses to be paid by the indemnifying
party, if representation of such indemnified party by the counsel retained by the indemnifying
party would be inappropriate due to actual or potential conflicting interests between such
indemnified party and any other party represented by such counsel in such action. The failure to
give notice to the indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the indemnified party under
this Section 2.7, unless such failure actually and materially prejudices the indemnifying party’s
ability to defend such action.
(d) Notwithstanding anything else herein to the contrary, the foregoing indemnity agreements
of the Company and the selling Holders are subject to the condition that,
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insofar as they relate to
any Damages arising from any untrue statement or alleged untrue statement of a material fact
contained in, or omission or alleged omission of a material fact from, a preliminary prospectus (or
necessary to make the statements therein not misleading) that has been corrected in the form of
prospectus included in the registration statement at the time it becomes effective, or any
amendment or supplement thereto filed with the SEC pursuant to Rule 424(b) under the Securities Act
(the “Final Prospectus”), such indemnity agreement shall not inure to the benefit of any Person if
a copy of the Final Prospectus was furnished to the indemnified party and such indemnified party
failed to deliver, at or before the confirmation of the sale of the shares registered in such
offering, a copy of the Final Prospectus to the Person asserting the loss, liability, claim, or
damage in any case in which such delivery was required by the Securities Act.
(e) To provide for just and equitable contribution to joint liability under the Securities Act
in any case in which either (i) any party otherwise entitled to indemnification hereunder makes a
claim for indemnification pursuant to this Section 2.7 but it is judicially determined (by the
entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case, notwithstanding the fact that this Section 2.7
provides for indemnification in such case, or (ii) contribution under the Securities Act may be
required on the part of any party hereto for which indemnification is provided under this Section
2.7, then, and in each such case, such parties will contribute to the aggregate losses, claims,
damages, liabilities, or expenses to which they may be subject (after contribution from others) in
such proportion as is appropriate to reflect the relative fault of each of the indemnifying party
and the indemnified party in connection with the statements, omissions, or other actions that
resulted in such loss, claim, damage, liability, or expense, as well as to reflect any other
relevant equitable considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things, whether the untrue or
allegedly untrue statement of a material fact, or the omission or alleged omission of a material
fact, relates to information supplied by the indemnifying party or by the indemnified party and the
parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent
such statement or omission; provided, however, that, in any such case, (x) no Holder will be
required to contribute any amount in excess of the public offering price of all such Registrable
Securities offered and sold by such Holder pursuant to such registration statement, and (y) no
Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation; and provided further that in no event shall a Holder’s liability
pursuant to this Section 2.7(e), when combined with the amounts paid or payable by such Holder
pursuant to Section 2.7(b), exceed the net proceeds from the offering received by such Holder (net
of any Selling Expenses) paid by such Holder), except in the case of willful misconduct or common
law fraud by such Holder.
(f) Notwithstanding the foregoing, to the extent that the provisions on indemnification and
contribution contained in the underwriting agreement entered into in connection with the
underwritten public offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall control; provided, however, that the provisions on indemnification and
contribution contained in the underwriting agreement shall not
| Advanced BioEnergy LLC — Hawkeye Registration Rights Agreement | Page 11 | |
contain provisions which expose the
Holders to greater liability (including greater liability resulting from reduced indemnification
rights) than the terms contained herein.
(g) The obligations of the Company and Holders under this Section 2.7 shall survive the
completion of any offering of Registrable Securities in a registration under Section 2 and shall
survive the termination of this Agreement.
2.8 Reports Under Exchange Act. With a view to making available to the Holders the
benefits of SEC Rule 144 and any other rule or regulation of the SEC that may at any time permit a
Holder to sell securities of the Company to the public without registration or pursuant to a
registration on Form S-3, the Company shall:
(a) make and keep available adequate current public information, as those terms are understood
and defined in SEC Rule 144, at all times;
(b) use commercially reasonable efforts to file with the SEC in a timely manner all reports
and other documents required of the Company under the Securities Act and the Exchange Act ; and
(c) furnish to any Holder, so long as the Holder owns any Registrable Securities, upon request
(i) to the extent accurate, a written statement by the Company that it has complied with the
reporting requirements of SEC Rule 144, the Securities Act, and the Exchange Act, or that it
qualifies as a registrant whose securities may be resold pursuant to Form S-3 (at any time after
the Company so qualifies); (ii) a copy of the most recent annual or quarterly report of the Company
and such other reports and documents so filed by the Company; and (iii) such other information as
may be reasonably requested in availing any Holder of any rule or regulation of the SEC that
permits the selling of any such securities without registration or pursuant to Form S-3 (at any
time after the Company so qualifies to use such form).
2.9 Limitations on Subsequent Registration Rights. From and after the date of this
Agreement, the Company shall not, without the prior written consent of the Holders of a majority of
the Registrable Securities, enter into any agreement with any holder or prospective holder of any
securities of the Company that would allow such holder or prospective holder to include such
securities in any Company registration or demand registration of any securities held by such holder
or prospective holder unless, under the terms of such agreement, such holder or prospective holder
may include such securities in any such registration only on a pari passu basis to the number of
the Registrable Securities of the Holders that are included. The Company shall not amend the EIP
Registration Rights Agreement or the SDWG Investor Rights Agreement in a manner adverse to the
Holders without the prior written consent of a majority in interest of the Holders.
2.10 “Market Stand-off” Agreement. Each Holder hereby agrees that it will not,
without the prior written consent of the managing underwriter, during the period commencing on the
date of the final prospectus relating to the IPO or other registration by the Company for its own
behalf of Units or any other equity securities under the Securities Act on a registration statement
on Form ▇-▇, ▇▇▇▇ ▇-▇, or Form S-3, and ending on the date specified by
| Advanced BioEnergy LLC — Hawkeye Registration Rights Agreement | Page 12 | |
the Company and the
managing underwriter (such period not to exceed (a) one hundred eighty (180) days in the case of
the IPO, which period may be extended upon the request of the managing underwriter for an
additional period of up to fifteen (15) days if the Company issues or proposes to issue an earnings
or other public release within fifteen (15) days of the expiration of the 180-day lockup period, or
(b) ninety (90) days in the case of any registration other than the IPO, which period may be
extended upon the request of the managing underwriter for an additional period of up to fifteen
(15) days if the Company issues or proposes to issue an earnings or other public release within
fifteen (15) days of the expiration of the 90-day lockup period), (i) lend; offer; pledge; sell;
contract to sell; sell any option or contract to purchase; purchase any option or contract to sell;
grant any option, right, or warrant to purchase; or otherwise transfer or dispose of, directly or
indirectly, any Units or any securities convertible into or exercisable or exchangeable (directly
or indirectly) for Units held immediately before the effective date of the registration statement
for such offering or (ii) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of such securities, whether any
such transaction described in clause (i) or (ii) above is to be settled by delivery of Units or
other securities, in cash, or otherwise. The foregoing
provisions of this Section 2.10 shall not apply to the sale of any shares to an underwriter
pursuant to an underwriting agreement, and shall be applicable to the Holders only if all officers,
directors, and members individually owning more than five percent (5%) of the Company’s outstanding
Units (or other voting equity securities) are subject to the same restrictions. Each Holder
further agrees to execute such agreements as may be reasonably requested by the underwriters in
connection with such registration that are consistent with this Section 2.10 or that are necessary
to give further effect thereto.
2.11 Restrictions on Transfer.
(a) The Registrable Securities shall not be sold, pledged, or otherwise transferred, and the
Company shall not recognize any such sale, pledge, or transfer, except upon the conditions
specified in this Agreement and Section 9 of the Operating Agreement, which conditions are intended
to ensure compliance with the provisions of the Securities Act. A transferring Holder will cause
any proposed purchaser, pledgee, or transferee of the Registrable Securities held by such Holder to
agree to take and hold such securities subject to the provisions and upon the conditions specified
in this Agreement and the Operating Agreement.
(b) In addition to any legend requirements set forth in the Operating Agreement, each
certificate or instrument representing the Registrable Securities shall (unless otherwise permitted
by the provisions of Section 2.11(c)) be stamped or otherwise imprinted with a legend substantially
in the following form:
THE SECURITIES REPRESENTED HEREBY HAVE BEEN ACQUIRED FOR INVESTMENT AND
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. SUCH SECURITIES
MAY NOT BE SOLD, PLEDGED, OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR A VALID EXEMPTION FROM THE REGISTRATION AND PROSPECTUS DELIVERY
REQUIREMENTS OF SAID ACT.
| Advanced BioEnergy LLC — Hawkeye Registration Rights Agreement | Page 13 | |
THE SECURITIES REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE
WITH THE TERMS OF THAT CERTAIN REGISTRATION RIGHTS AGREEMENT BETWEEN THE
COMPANY AND CERTAIN HOLDERS OF ITS SECURITIES, A COPY OF WHICH IS ON FILE WITH
THE SECRETARY OF THE COMPANY.
The Holders consent to the Company making a notation in its records and giving instructions to
any transfer agent of the Restricted Securities in order to implement the restrictions on transfer
set forth in this Section 2.11
(c) The holder of each certificate representing Restricted Securities, by acceptance thereof,
agrees to comply in all respects with the provisions of this Section 2. Before any proposed sale,
pledge, or transfer of any Restricted Securities, unless there is in effect a registration
statement under the Securities Act covering the proposed transaction, the Holder thereof shall give
notice to the Company of such Holder’s intention to effect such sale, pledge, or transfer. Each
such notice shall describe the manner and circumstances of the proposed sale, pledge, or transfer
in sufficient detail and, if reasonably requested by the Company, shall be accompanied at such
Holder’s expense by either (i) a written opinion of legal counsel who shall, and whose legal
opinion shall, be reasonably satisfactory to the Company, addressed to the Company, to the effect
that the proposed transaction may be effected without registration under the Securities Act; (ii) a
“no action” letter from the SEC to the effect that the proposed sale, pledge, or transfer of such
Restricted Securities without registration will not result in a recommendation by the staff of the
SEC that action be taken with respect thereto; or (iii) any other evidence reasonably satisfactory
to counsel to the Company to the effect that the proposed sale, pledge, or transfer of the
Restricted Securities may be effected without registration under the Securities Act, whereupon the
Holder of such Restricted Securities shall be entitled to sell, pledge, or transfer such Restricted
Securities in accordance with the terms of the notice given by the Holder to the Company. The
Company will not require such a legal opinion or “no action” letter (x) in any transaction in
compliance with SEC Rule 144 or (y) in any transaction in which such Holder distributes Restricted
Securities to an Affiliate of such Holder (which for the purposes of this sentence shall include
any member, partner or stockholder of such Holder) for no consideration; provided that in the case
of a transfer to an Affiliate each transferee agrees in writing to be subject to the terms of this
Section 2.11. Each certificate or instrument evidencing the Restricted Securities transferred as
above provided shall bear, except if such transfer is made pursuant to SEC Rule 144, the
appropriate restrictive legend set forth in Section 2.11(b), except that such certificate shall not
bear such restrictive legend if, in the opinion of counsel for such Holder and the Company, such
legend is not required in order to establish compliance with any provisions of the Securities Act.
2.12 Termination of Registration Rights. The right of any Holder to request
registration or inclusion of Registrable Securities in any registration pursuant to Section 2.1 or
Section 2.2 shall terminate upon the earliest to occur of (a) the closing of a transaction
resulting in a “Dissolution Event” as such term is defined in the Operating Agreement and (b) the
date on which such Holder is entitled to sell all of the Units owned by it pursuant to Rule 144
without compliance with any of the Rule 144 availability of adequate current public information
about the issuer, volume limitations, manner of sale requirements, filing of a Form 144 or other
conditions.
| Advanced BioEnergy LLC — Hawkeye Registration Rights Agreement | Page 14 | |
3. Miscellaneous.
3.1 Successors and Assigns. Except as set forth in this Section 3.1, this Agreement
shall not be assignable by Hawkeye without the prior written consent of the Company. Prior written
consent will not be required for any assignment of this Agreement by Hawkeye to an Affiliate
assignee or an assignee acquiring at least fifty percent (50%) of the Registrable Securities prior
to such assignment, provided that (i) the Company is, within a reasonable period of time after such
transfer, furnished with written notice of the name and address of such assignee and (ii) such
assignee agrees in a written instrument satisfactory to the Company, to be bound by and subject to
the terms and conditions of this Agreement. Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their respective successors and
permitted assignees any rights, remedies, obligations or liabilities under or by reason of this
Agreement, except as expressly provided herein.
3.2 Governing Law. This Agreement shall be governed by and construed in accordance
with the Limited Liability Company Act of the State of Delaware as to matters within the scope
thereof, and as to all other matters shall be governed by and construed in accordance with the
internal laws of the State of Delaware, without regard to its principles of conflicts of laws. In
any action between the parties arising out of or relating to this Agreement or any of the
transactions contemplated by this Agreement: (a) each of the parties irrevocably waives the right
to trial by jury; and (b) each of the parties irrevocably consents to service of process by first
class certified mail, return receipt requested, postage prepaid, to the address at which such party
is to receive notice in accordance with Section 3.5.
3.3 Counterparts; Facsimile. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. This Agreement may also be executed and delivered by facsimile
signature and in two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
3.4 Titles and Subtitles. The titles and subtitles used in this Agreement are for
convenience only and are not to be considered in construing or interpreting this Agreement.
3.5 Notices.
All notices and other communications hereunder shall be in writing and shall be deemed given
if delivered personally, telecopied (which is confirmed), one business day after being deposited
with a nationally recognized overnight courier, or two business days after being mailed by
registered or certified mail (return receipt requested) to the parties at the following addresses
(or at such other address for a party as shall be specified by like notice):
| Advanced BioEnergy LLC — Hawkeye Registration Rights Agreement | Page 15 | |
If to Hawkeye:
|
with a copy to: | |
Hawkeye Energy Holdings, LLC
|
▇▇▇▇▇▇ ▇. ▇▇▇ Partners, LLP |
|
▇▇▇ ▇. ▇▇▇▇ ▇▇▇.
|
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ |
|
▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
|
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ |
|
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
|
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ |
|
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
|
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
|
| and a copy to: | ||
Weil, Gotshal & ▇▇▇▇▇▇ LLP |
||
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ |
||
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ |
||
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇ |
||
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
||
If to the Company:
|
with a copy to: | |
Faegre & ▇▇▇▇▇▇ LLP |
||
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
|
2200 ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ |
|
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
|
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ |
|
▇▇▇▇▇▇▇▇▇: President ▇▇▇▇▇▇ ▇▇▇▇▇
|
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ |
|
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
|
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ |
|
Fax: (▇▇▇) ▇▇▇-▇▇▇▇ |
(a) If, during the period of time from and after any permissible assignment under Section 3.1
until the time the Company receives written notice of the name and address of the Affiliate
assignee, the Company provides notice to Hawkeye under this Agreement and in accordance with this
Section 3.5, the notice given to Hawkeye will be deemed to have been given to the Affiliate
assignee.
3.6 Amendments and Waivers. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a particular
instance, and either retroactively or prospectively) only with the written consent of the Company
and the Holders of a majority of the Registrable Securities; provided, that the Company may
in its sole discretion waive compliance with Section 2.11(c) (and the Company’s failure to
object promptly in writing after notification of a proposed assignment allegedly in violation of
Section 2.11(c) shall be deemed to be a waiver); and provided further, that any
provision hereof may be waived by any waiving party on such party’s own behalf, without the consent
of any other party; provided further, however, this Agreement may not be amended or
terminated and the observance of any term hereof may not be waived with respect to any Holder
without the written consent of such Holder, unless such amendment, termination, or waiver applies
to all Holders in the same fashion. The Company shall give prompt notice of any amendment or
termination hereof or waiver hereunder to any party hereto that did not consent in writing to such
amendment, termination, or waiver. Any amendment, termination, or waiver effected in accordance
with this Section 3.6 shall be binding on all parties hereto, regardless of whether any
such party has consented thereto. No waivers of or exceptions to any term,
| Advanced BioEnergy LLC — Hawkeye Registration Rights Agreement | Page 16 | |
condition, or provision of this Agreement, in any one or more instances, shall be deemed to be
or construed as a further or continuing waiver of any such term, condition, or provision.
3.7 Severability. If any provision of this Agreement is held to be illegal, invalid
or unenforceable under any present or future law or regulation, and if the rights or obligations of
any party hereto under this Agreement will not be materially and adversely affected thereby, (a)
such provision will be fully severable, (b) this Agreement will be construed and enforced as if
such illegal, invalid or unenforceable provision had never comprised a part hereof, (c) 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 from this Agreement
and (d) 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.
3.8 Aggregation of Securities. All shares of Registrable Securities held or acquired
by Affiliates of a Holder shall be aggregated together for the purpose of determining the
availability of any rights under this Agreement of such Holder.
3.9 Entire Agreement. This Agreement, together with the Subscription Documents
(including any Schedules and Exhibits hereto and thereto), constitutes the full and entire
understanding and agreement among the parties with respect to the subject matter hereof, and any
other written or oral agreement relating to the subject matter hereof existing between the parties
is expressly canceled.
3.10 Delays or Omissions. No delay or omission to exercise any right, power, or
remedy accruing to any party under this Agreement, upon any breach or default of any other party
under this Agreement, shall impair any such right, power, or remedy of such nonbreaching or
nondefaulting party, nor shall it be construed to be a waiver of or acquiescence to any such breach
or default, or to any similar breach or default thereafter occurring, nor shall any waiver of any
single breach or default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. All remedies, whether under this Agreement or by law or otherwise afforded
to any party, shall be cumulative and not alternative.
*****
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| Advanced BioEnergy LLC — Hawkeye Registration Rights Agreement | Page 17 | |
The Parties hereto have executed this Agreement on the date first above written.
| ADVANCED BIOENERGY, LLC |
||||
| /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | ||||
| Name: | ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | |||
| Title: | CEO | |||
| HAWKEYE ENERGY HOLDINGS, LLC |
||||
| /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | ||||
| Name: | ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | |||
| Title: | Chief Financial Officer | |||
[Signature Page to Registration Rights Agreement]