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EXHIBIT 4.8
COMMON STOCK
REGISTRATION RIGHTS AGREEMENT
DATED AS OF AUGUST 29, 2000
BY AND BETWEEN
CHESAPEAKE ENERGY CORPORATION
AND
PARIBAS NORTH AMERICA, INC.
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This Common Stock Registration Rights Agreement (this "AGREEMENT") is made and
entered into as of August 29, 2000 among Chesapeake Energy Corporation, an
Oklahoma corporation (the "COMPANY") and Paribas North America, Inc. (the
"CERTIFICATE HOLDER").
BNP Paribas, parent of the Certificate Holder ("BNP") has agreed to
sell Gothic Energy Corporation 14 1/8% Series B Senior Secured Discount Notes
Due 2006 and the beneficial interests in the related indenture and pledge
agreement owned by BNP (collectively, the "NOTES") pursuant to that certain
Senior Secured Discount Notes Purchase Agreements dated August 29, 2000, between
Chesapeake Energy Marketing, Inc., an Oklahoma corporation and wholly owned
subsidiary of the Company ("CEMI"), and BNP (the "PURCHASE AGREEMENT"). In order
to induce BNP to sell the Notes, the Company has agreed to provide the
registration rights set forth in this Agreement, to make the representations
provided in this Agreement and to issue additional shares of stock as provided
herein in satisfaction of paragraph 10.1 of the Purchase Agreement, if
necessary. The execution and delivery of this Agreement is a condition to the
obligations of BNP set forth in Section 9 of the Purchase Agreement. Capitalized
terms used herein but not defined have the respective meanings set forth in the
Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have
the following meanings:
ACT: The Securities Act of 1933, as amended.
AFFILIATE: As defined in Rule 144 of the Act.
BUSINESS DAY: Any day on which the New York Stock Exchange is open for
trading and which is not a legal United States holiday.
CLOSING DATE: August 31, 2000.
COMMON STOCK: Common Stock, $.01 par value per share, of the Company.
COMMISSION: The Securities and Exchange Commission.
EFFECTIVE DATE: The date the Shelf Registration Statement is declared
effective by the Commission.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
HOLDERS: As defined in Section 2 hereof.
PERSON: Any individual, corporation, partnership, joint venture, trust,
estate,
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unincorporated organization or government or any agency or political
subdivision thereof.
PROSPECTUS: The prospectus included in the Shelf Registration Statement
at the time such Shelf Registration Statement is declared effective, as
amended or supplemented by any prospectus supplement and by all other
amendments thereto, including post-effective amendments, all material
incorporated by reference into such Prospectus and any information
previously omitted in reliance upon Rule 430A of the Act.
PURCHASE PRICE: The cash and Shares to be exchanged as payment for the
Notes pursuant to the Purchase Agreement.
RECOMMENCEMENT DATE: As defined in Section 5(b) hereof.
RULE 144: Rule 144 promulgated under the Act.
SHARES: The shares of Common Stock constituting a portion of the
Purchase Price which are transferred to the Certificate Holder pursuant
to the Purchase Agreement including any adjustment under paragraph 10.1
of the Purchase Agreement.
SHELF REGISTRATION STATEMENT: As defined in Section 3 hereof.
SUSPENSION NOTICE: As defined in Section 5(b) hereof.
TRANSFER RESTRICTED SECURITIES: The Shares, upon delivery thereof to
the Certificate Holder pursuant to the Purchase Agreement and at all
times subsequent thereto, until (a) the date on which the Shares have
been disposed of in accordance with the Shelf Registration Statement,
(b) the date on which the Shares are distributed to the public pursuant
to Rule 144 or are saleable pursuant to Rule 144(k) (or similar
provisions then in effect) under the Act or (c) the date on which the
Shares cease to be outstanding. A Share will cease being a Transfer
Restricted Security at such time that the foregoing clauses (a), (b) or
(c) apply to such Share.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities
(each, a "HOLDER") whenever such Person owns Transfer Restricted Securities.
SECTION 3. SHELF REGISTRATION
As soon as practicable after the Closing Date but in no event later
than 10 business days after the Closing Date, the Company shall file with the
Commission a shelf registration statement pursuant to Rule 415 under the Act
(the "SHELF REGISTRATION STATEMENT"), relating to all Transfer Restricted
Securities, and shall use its best efforts to cause such Shelf Registration
Statement to
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become effective on or prior to 45 days after the Closing Date. The Shelf
Registration Statement will cover a minimum of 389,378 shares of Common Stock..
The Company shall use its best efforts to keep the Shelf Registration
Statement required by this Section 3 continuously effective, supplemented and
amended as required by and subject to the provisions of Section 5(a) hereof to
the extent necessary to ensure that it is available for sales of Transfer
Restricted Securities by the Holders thereof entitled to the benefit of this
Section 3, and to ensure that it conforms with the requirements of this
Agreement, the Act and the policies, rules and regulations of the Commission as
announced from time to time, for the shorter of (i) two years following the
Closing Date or (ii) the date on which all Transfer Restricted Securities
covered by the Shelf Registration Statement have been sold pursuant thereto.
SECTION 4. PROVISION BY HOLDERS OF CERTAIN INFORMATION
No Holder of Transfer Restricted Securities may include any of its
Transfer Restricted Securities in the Shelf Registration Statement pursuant to
this Agreement unless such Holder furnishes to the Company in writing the
information specified in Item 507 or 508 of Regulation S-K, as applicable, of
the Act for use in connection with the Shelf Registration Statement or
Prospectus or preliminary Prospectus included therein. The Certificate Holder
agrees to furnish the Company such information on or before ten (10) days after
the Closing Date. Each selling Holder agrees to promptly furnish additional
information required to be disclosed in order to make the information previously
furnished to the Company by such Holder not materially misleading.
SECTION 5. SHELF REGISTRATION PROCEDURES
(a) Procedures. In connection with the Shelf Registration Statement,
the Company shall:
(i) use its best efforts to effect such registration to permit
the sale of the Transfer Restricted Securities being sold in
accordance with the intended method or methods of distribution
thereof (as indicated in the information furnished to the Company
pursuant to Section 4 hereof), and pursuant thereto the Company
will prepare and file with the Commission a Shelf Registration
Statement relating to the registration on any appropriate form
under the Act, which form shall be available for the sale of the
Transfer Restricted Securities in accordance with the intended
method or methods of distribution thereof within the time periods
and otherwise in accordance with the provisions hereof. The Company
shall not be permitted to include in the Shelf Registration
Statement any securities other than the Transfer Restricted
Securities;
(ii) use its best efforts to keep such Shelf Registration
Statement continuously effective and provide all requisite
financial statements for the period specified in Section 3 of this
Agreement. Upon the occurrence of any event that would cause any
such Shelf Registration Statement or the Prospectus contained
therein (i) to contain an untrue statement of a material fact or
omit to state any material fact necessary to make the statements
therein not misleading or (ii) not to
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be effective and usable for resale of Transfer Restricted
Securities during the period required by this Agreement, the
Company shall file promptly (A) an appropriate amendment to such
Shelf Registration Statement curing such defect, and, if Commission
review is required, use its best efforts to cause such amendment to
be declared effective as soon as practicable, (B) a supplement
pursuant to Rule 424 under the Act curing such defect or (C) an
Exchange Act report incorporated by reference curing such defect;
(iii) prepare and file with the Commission such amendments and
post-effective amendments to the Shelf Registration Statement as
may be necessary to keep such Shelf Registration Statement
effective for the applicable period set forth in Section 3 hereof,
cause the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424
under the Act, and to comply fully with Rules 424, 430A and 462, as
applicable, under the Act in a timely manner; and comply with the
provisions of the Act with respect to the disposition of all
Transfer Restricted Securities covered by such Shelf Registration
Statement during the applicable period in accordance with the
intended method or methods of distribution by the sellers thereof
set forth in such Shelf Registration Statement or supplement to the
Prospectus;
(iv) advise the Holders and underwriters, if any, promptly
and, if requested by such Persons, confirm such advice in writing,
(A) when the Shelf Registration Statement or any Prospectus
supplement or post-effective amendment has been filed, and, with
respect to the Shelf Registration Statement or any post-effective
amendment thereto, when the same has become effective, (B) of any
request by the Commission for amendments to the Shelf Registration
Statement or amendments or supplements to the Prospectus or for
additional information relating thereto, (C) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Shelf Registration Statement under the Act or of the suspension by
any state securities commission of the qualification of the
Transfer Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, and (D) of the existence of any fact or the
happening of any event that makes any statement of a material fact
made in the Shelf Registration Statement, the Prospectus, any
amendment or supplement thereto made, not misleading;
(v) subject to Section 5(a)(ii), if any fact or event
contemplated by Section 5(iv)(D) above shall exist or have
occurred, prepare a post-effective amendment or supplement to the
Shelf Registration Statement or related Prospectus or any document
incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of
Transfer Restricted Securities, the Prospectus will not contain an
untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(vi) deliver to each Holder and underwriter, if any, without
charge, a
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reasonable number of copies of the Prospectus (including each
preliminary prospectus) and any amendment or supplement thereto as
such Holder or underwriter reasonably may request; the Company
hereby consents to the use (in accordance with law) of the
Prospectus and any amendment or supplement thereto by each Holder
and each underwriter, if any, in connection with the offering and
the sale of the Transfer Restricted Securities covered by the
Prospectus or any amendment or supplement thereto;
(vii) prior to any offering of Transfer Restricted Securities,
cooperate with the Holders in connection with the registration and
qualification of the Transfer Restricted Securities under the
securities or Blue Sky laws of such jurisdictions as reasonably
requested and do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of the
Transfer Restricted Securities covered by the Shelf Registration
Statement; provided, however, that the Company shall not be
required to register or qualify as a foreign corporation where it
is not now so qualified or to take any action that would subject it
to the service of process in suits or to taxation, other than as to
matters and transactions relating to the Shelf Registration
Statement, in any jurisdiction where it is not now so subject;
(viii) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being
Transfer Restricted Securities, cooperate with the Holders to
facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold and not
bearing any restrictive legends;
(ix) list all shares of Common Stock covered by the Shelf
Registration Statement on the principal U.S. securities exchange on
which the Common Stock is then listed;
(x) use its best efforts to cause the disposition of the
Transfer Restricted Securities covered by the Shelf Registration
Statement to be registered with or approved by such other
governmental agencies or authorities as may be required to enable
the seller or sellers thereof to consummate the disposition of such
Transfer Restricted Securities;
(xi) use its best efforts to comply with all applicable rules
and regulations of the Commission, and make generally available to
its security holders with regard to the Shelf Registration
Statement, as soon as practicable, a consolidated earnings
statement meeting the requirements of Rule 158 (which need not be
audited) covering a twelve-month period beginning after the
Effective Date (as such term is defined in paragraph (c) of Rule
158 under the Act);
(xvii) provide to the Holders with a reasonable opportunity to
review and comment on any registration statement to be filed
pursuant to this Agreement prior to the filing thereof with the
Commission, and shall make all changes thereto as any
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Holder may request in writing to the extent such changes are
required, in the judgment of the Company, by the Act;
(xviii) use reasonable commercial efforts to obtain the
withdrawal of any order suspending the effectiveness of such
registration statement, or the lifting of any suspension of the
qualification (or exemption from qualification) of any of the
Transfer Restricted Securities for sale in any jurisdiction, at the
earliest possible moment;
(xixiv) use its best efforts to furnish to each Holder and to
each managing underwriter, if any, a signed counterpart, addressed
to such Holder or such underwriter, if any, of (i) an opinion or
opinions of counsel to the Company and (ii) a comfort letter or
comfort letters from the Company=s independent public accountants
pursuant to SAS 72, each in customary form and covering such
matters of the type customarily covered by opinions or comfort
letters, as the case may be, as such Holder or the managing
underwriter reasonably requests;
(xxv) enter into customary agreements (including underwriting
agreements in customary form, which shall include Alock-up@
obligations as may be requested by the managing underwriters, not
to exceed 90 days in duration, but excluding shares that may be
issued pursuant to benefit plans or in connection with mergers or
acquisitions) and take such other actions (including using its
reasonable efforts to make such domestic road show presentations
and otherwise engaging in such reasonable marketing support in
connection with any underwritten offering, including without
limitation the obligation to make its executive officers available
for such purpose if so requested by the selling Holder (a ARoad
Show@)) as are reasonably requested by any selling Holder in order
to expedite or facilitate the sale of any Transfer Restricted
Securities covered by a registration statement pursuant to an
underwritten offering in accordance herewith; and
(xxi) select an investment banking firm or firms of national
standing to manage the underwritten offering, subject to the
reasonable consent of the Holders of a majority of the Transfer
Restricted Securities for such registration.
(b) Restrictions on Holders. Each Holder agrees by acquisition of a
Transfer Restricted Security that, upon receipt of (i) the notice referred to in
Section 5(a)(iv)(C), (ii) any notice from the Company of the existence of any
fact of the kind described in Section 5(a)(iv)(D) hereof or (iii) any notice
from the Company that (a) sales under the Shelf Registration Statement would
require the disclosure of material information which the Company has a bona fide
business purpose for preserving as confidential, or (b) such disclosure would
impede the Company's ability to consummate a material transaction (in each case,
a "SUSPENSION NOTICE"), such Holder will forthwith discontinue disposition of
Transfer Restricted Securities pursuant to the Shelf Registration Statement
until (A) such Holder has received copies of the supplemented or amended
Prospectus contemplated by Section 5(a)(v) hereof, or (B) such Holder is advised
in writing by the Company that the use of the Prospectus may be resumed, and has
received copies of any additional or supplemental filings that are incorporated
by reference in the Prospectus (in each case, the
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"RECOMMENCEMENT DATE"), provided, that any suspension pursuant to clause (iii)
above shall not exceed 60 days in any twelve-month period. Each Holder receiving
a Suspension Notice hereby agrees that it will either (x) destroy any
Prospectuses, other than permanent file copies, then in such Holder's possession
which have been replaced by the Company with more recently dated Prospectuses or
(y) deliver to the Company (at the Company's expense) all copies, other than
permanent file copies, then in such Holder's possession of the Prospectus
covering such Transfer Restricted Securities that was current at the time of
receipt of the Suspension Notice.
(c) Restrictions on the Company. During the period specified in Section
3 of this Agreement, the Company will not effect any public sale or distribution
of any securities the same as or similar to the Transfer Restricted Securities,
or any securities convertible into or exchangeable or exercisable for any
Company securities the same as or similar to the Transfer Restricted Securities
(except pursuant to registration on Form S-4 or any successor form, or otherwise
in connection with the acquisition of a business or assets of a business, a
merger, or an exchange offer for the securities of the issuer of another entity,
or registrations on Form S-8 or any successor form relating solely to securities
offered pursuant to any benefit plan), during the 14-day period prior to and
through the period (i) beginning on the commencement of the public distribution
of Transfer Restricted Securities pursuant to the Shelf Registration Statement
in an underwritten offering by or on behalf of any Holder to the extent timely
notified in writing by the selling Holders or the underwriters managing such
distribution and (ii) ending on the first to occur of (A) the 90th day after
such commencement and (B) the end of such distribution (the "Company Standstill
Period"), including that portion of such period following an underwritten
distribution commenced during the Company Standstill Period that does not
coincide with the Company Standstill Period.
SECTION 6. PIGGYBACK REGISTRATIONS
(a) In addition to the agreements relating to the Shelf Registration
Statement the Company agrees as follows:
(i) If at any time the Company proposes to file an additional
registration statement under the Act with respect to an offering of
Common Stock (x) for the Company's own account (except pursuant to
registrations on Form S-4 or any successor form, or Form S-8 or any
successor form relating solely to securities issued pursuant to any
benefit plan) or (y) for the account of any holders of Common Stock
other than the Certificate Holder, then (A) the Company shall give
written notice of such proposed filing to the Certificate Holder as
soon as practicable (but in no event less than 30 days before the
anticipated filing date), (B) such notice shall offer the
Certificate Holder, subject to the terms and conditions hereof, the
opportunity to request that such actions be taken under Rule 429
under the Act ("Rule 429") as shall cause the prospectus contained
in such additional registration statement (a "Piggyback
Registration Statement") to be available to permit the offer and
sale, at the Certificate Holder's election, of some or all of the
Transfer Restricted Securities owned by the Certificate Holder on
the same terms and conditions as the Company's or such other
holder's Common Stock (a "Piggyback Sale"), and (C) the Company
shall otherwise take such reasonable actions as will enable the
Certificate Holder to effect a Piggyback Sale on such terms and
conditions.
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(ii) Subject to Section 6(b), the Company shall take such
actions as shall be required under Rule 429 to cause the combined
prospectus contained in the Piggyback Registration Statement to
permit the offer and sale of all Transfer Restricted Securities
requested by the Certificate Holder within 20 days after the
receipt of any notice given by the Company pursuant to Section
6(a)(i), clause (A), to be covered by such combined prospectus;
provided, however, that if, at any time after giving written notice
of its intention to register any securities and prior to the
effective date of such Piggyback Registration Statement, the
Company shall determine for any reason not to register or to delay
registration of such securities, the Company may, at its election,
give written notice of such determination to the Certificate Holder
and, thereupon, (i) in the case of a determination not to register,
will be relieved of any obligation to cause any Transfer Restricted
Securities to be covered by such combined prospectus, without
prejudice, however, to the rights of the Certificate Holder to have
its Transfer Restricted Securities continue to be included in the
Shelf Registration Statement and (ii) in the case of a
determination to delay registering, shall be permitted to delay
causing any Transfer Restricted Securities to be covered by the
combined prospectus for the same period as the delay in registering
such other securities.
(iii) If the offering pursuant to such Piggyback Registration
Statement is to be underwritten, then the Certificate Holder making
a request for a Piggyback Sale pursuant to this Section 6(a) must
participate in such underwritten offering and shall not be
permitted to make any other offering in connection with such
registration. If the offering pursuant to such Piggyback
Registration Statement is to be on any other terms, then the
Certificate Holder making a request for a Piggyback Sale pursuant
to this Section 6(a) must participate in such offering on such
basis and shall not be permitted to make an underwritten offering
in connection with such registration. The Certificate Holder shall
be permitted to withdraw all or part of the Certificate Holder's
Transfer Restricted Securities from coverage by a Piggyback
Registration Statement at any time prior to (but only prior to) the
effective date thereof without prejudice to the rights of the
Certificate Holder to have its Transfer Restricted Securities
continue to be included in the Shelf Registration Statement.
(b) Notwithstanding anything contained herein, if the managing
underwriter or underwriters of a sale or offering described in Section 6(a)
pursuant to which the Certificate Holder has requested a Piggyback Sale shall
advise the Company in writing that (x) the size of the offering that the
Certificate Holder, the Company and any other holders intend to make or (y) the
kind of securities that the Certificate Holder, the Company and such other
holders intend to include in such offering are such that the success of the
offering would be materially and adversely affected, then (A) if the size of the
offering is the basis of such underwriter's advice, the amount of Transfer
Restricted Securities to be offered for the account of the Certificate Holder
shall be reduced to the extent necessary to reduce the total amount of
securities to be included in such offering to the amount recommended by such
managing underwriter or underwriters; provided, however, that, if securities are
being offered for the account of Persons other than the Company or the
Certificate Holder, the proportion by which the amount of such Transfer
Restricted Securities intended to be
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offered for the account of the Certificate Holder is reduced shall not exceed
the proportion by which the amount of such securities intended to be offered for
the account of such Persons is reduced; and (B) if the combination of securities
to be offered is the basis of such underwriter's advice (1) the Transfer
Restricted Securities to be included in such offering shall be reduced as
described in clause (A) above (subject to the provision in clause (A)) or (2) if
the actions described in sub-clause (1) of this clause (B) would, in the
judgment of the managing underwriter, be insufficient to eliminate the adverse
effect that inclusion of the Transfer Restricted Securities requested to be
included would have on such offering, such Transfer Restricted Securities will
be excluded from such offering, but only if all shares of Common Stock are also
excluded. Any reduction in Transfer Restricted Securities to be included in an
underwritten offering as contemplated by this Section 6(b) shall be without
prejudice to the Certificate Holder's rights to have the Transfer Restricted
Securities continue to be included in the Shelf Registration Agreement.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's performance of or compliance with
this Agreement will be borne by the Company, regardless of whether a Shelf
Registration Statement required by this Agreement becomes effective, including
without limitation: (i) all registration and filing fees and expenses; (ii) all
fees and expenses of compliance with federal securities and state Blue Sky or
securities laws; (iii) all expenses of printing, messenger and delivery services
and telephone; (iv) all fees and disbursements of counsel for the Company and
not more than one counsel for the Holders of Transfer Restricted Securities as
described in Section 7(b) below; (v) all application and filing fees in
connection with listing the Common Stock on a national securities exchange
pursuant to the requirements hereof; (vi) all fees and disbursements of
independent certified public accountants of the Company (including the expenses
of any special audit and comfort letters required by or incident to such
performance); and (vii) fees and expenses in connection with any review of
underwriting arrangements by the National Association of Securities Dealers,
Inc. including fees and expenses of any "qualified independent underwriter" in
connection with an underwritten offering.
The Company will, in any event, bear its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties), the expenses of any annual audit and the fees and
expenses of any Person, including special experts, retained by the Company. The
Certificate Holder will bear the expense of any underwriting commissions in
connection with an underwritten offering.
(b) The Company will reimburse the Holders selling Transfer Restricted
Securities pursuant to the "Plan of Distribution" contained in the Shelf
Registration Statement for the reasonable fees and disbursements of not more
than one counsel selected by the Holders of a majority of the Transfer
Restricted Securities.
SECTION 8. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless each Holder, its
directors, its officers and each Person, if any, who controls such Holder
(within the meaning of Section 15 of the Act and Section 20 of the Exchange
Act), from and against any and all losses, claims, damages, liabilities,
judgments, (including without limitation, any legal or other expenses incurred
in
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connection with investigating or defending any matter, including any action that
could give rise to any such losses, claims, damages, liabilities or judgments)
caused by any untrue statement or alleged untrue statement of a material fact
contained in the Shelf Registration Statement, preliminary prospectus or
Prospectus (or any amendment or supplement thereto) provided by the Company to
any Holder or any prospective purchaser of Shares pursuant to the Shelf
Registration Statement or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by an untrue statement or omission
or alleged untrue statement or omission that is based upon information relating
to any of the Holders furnished in writing to the Company by any of the Holders
expressly for use in the Shelf Registration Statement or Piggyback Registration
Statement.
(b) Each Holder of Transfer Restricted Securities agrees, severally and
not jointly, to indemnify and hold harmless the Company and its directors and
officers, and each Person, if any, who controls (within the meaning of Section
15 of the Act or Section 20 of the Exchange Act) the Company, to the same extent
as the foregoing indemnity from the Company set forth in section (a) above, but
only with reference to information relating to such Holder furnished in writing
to the Company by such Holder expressly for use in the Shelf Registration
Statement.
(c) In case any action shall be commenced involving any Person in
respect of which indemnity may be sought pursuant to Section 7(a) or 7(b) (the
"indemnified party"), the indemnified party shall promptly notify the Person
against whom such indemnity may be sought (the "indemnifying party") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 7(a) and 7(b), a Holder shall not be required to assume the
defense of such action pursuant to this Section 7(c), but may employ separate
counsel and participate in the defense thereof, but the fees and expenses of
such counsel, except as provided below, shall be at the expense of the Holder).
Any indemnified party shall have the right to employ separate counsel in any
such action and participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of the indemnified party unless (i) the
employment of such counsel shall have been specifically authorized in writing by
the indemnifying party, (ii) the indemnifying party shall have failed to assume
the defense of such action or employ counsel reasonably satisfactory to the
indemnified party or (iii) the named parties to any such action (including any
impleaded parties) include both the indemnified party and the indemnifying
party, and the indemnified party shall have been advised by such counsel that
there may be one or more legal defenses available to it which are different from
or additional to those available to the indemnifying party (in which case the
indemnifying party shall not have the right to assume the defense of such action
on behalf of the indemnified party). In any such case, the indemnifying party
shall not, in connection with any one action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) for
all indemnified parties and all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by the Holders of a
majority of the Transfer Restricted Securities, in the case of the parties
indemnified pursuant to Section 7(a), and by the Company, in the case of parties
indemnified pursuant to Section 7(b). The indemnifying party shall indemnify and
hold
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harmless the indemnified party from and against any and all losses, claims,
damages, liabilities and judgments by reason of any settlement of any action (i)
effected with its written consent or (ii) effected without its written consent
if the settlement is entered into more than (20) twenty Business Days after the
indemnifying party shall have received a request from the indemnified party for
reimbursement for the fees and expenses of counsel (in any case where such fees
and expenses are at the expense of the indemnifying party) and, prior to the
date of such settlement, the indemnifying party shall have failed to comply with
such reimbursement request. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement or compromise
of, or consent to the entry of judgment with respect to, any pending or
threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
(d) To the extent that the indemnification provided for in this Section
7 is unavailable to an indemnified party in respect of any losses, claims,
damages, liabilities or judgments referred to therein, then each indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or judgments in such proportion as is appropriate
to reflect the relative fault of the Company on the one hand, and of the
Holders, on the other hand, in connection with the statements or omissions which
resulted in such losses, claims, damages, liabilities or judgments, as well as
any other relevant equitable considerations. The relative fault of the Company,
on the one hand, and of the Holders, on the other hand, shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, on the one hand, or by the
Holders, on the other hand, and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims,
damages, liabilities and judgments referred to above shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating or defending any action or claim.
The Company and each Holder agree that it would not be just and
equitable if contribution pursuant to this Section 8(d) were determined by pro
rata allocation (even if the Holders were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any matter, including any action that could have given rise to such
losses, claims, damages, liabilities or judgments. Notwithstanding the
provisions of this Section 8, no Holder will be required to contribute any
amount in excess of the amount by which the net proceeds of the offering (before
deducting expenses) received by such Holder exceeds the amount of damages that
such Holder has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the
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meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The Holders'
obligations to contribute pursuant to this Section 8(d) are several in
proportion to the respective Transfer Restricted Securities held by each of the
Holders hereunder and not joint.
SECTION 9. RULE 144A AND RULE 144
The Company agrees with each Holder, for so long as any Transfer
Restricted Securities remain outstanding and during any period in which the
Company (i) is not subject to Section 13 or 15(d) of the Exchange Act, to make
available, upon request of any Holder of Transfer Restricted Securities, to any
Holder or beneficial owner of Transfer Restricted Securities in connection with
any sale thereof and any prospective purchaser of Transfer Restricted Securities
designated by such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Act in order to permit resale of such Transfer Restricted
Securities pursuant to Rule 144A, and (ii) is subject to Section 13 or 15(d) of
the Exchange Act, to make all filings required thereby in a timely manner in
order to permit resales of such Transfer Restricted Securities pursuant to Rule
144 (if available).
SECTION 10. REPRESENTATIONS
(a) The Company (i) is a corporation duly organized, validly existing
and in good standing under the laws of the State of Oklahoma, (ii) has the
corporate power to execute and deliver this Agreement and to consummate the
transactions contemplated hereby and (iii) is not in default under or in
violation of any provision of the Company's certificate of incorporation or
bylaws.
(b) The authorized capital stock of the Company consists of 250,000,000
shares of Common Stock and 10,000,000 shares of preferred stock of which
148,768,103 shares of Common Stock and 624,037 shares of preferred stock were
issued and outstanding as of June 16, 2000.
(c) The Company has delivered or made available to the Certificate
Holder each registration statement, report, definitive proxy statement or
definitive information statement and all exhibits thereto filed since December
31, 1998, each in the form (including exhibits and any amendments thereto) filed
with the Commission. Except as otherwise disclosed, such reports were filed with
the Commission in a timely manner, constitute all forms, reports and documents
required to be filed by the Company under the Act, the Exchange Act and the
rules and regulations promulgated thereunder. As of their respective dates, such
reports (a) complied as to form in all material respects with the applicable
requirements of the Act and the Exchange Act and (b) did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements made therein not misleading.
Each of the balance sheets of the Company included in or incorporated by
reference in such reports (including the related notes and schedules) fairly
presents the financial position of the Company as of the date thereof and each
of the statements of income, retained earnings and cash flow of the Company
included or incorporated by reference into such reports (including any related
notes and schedules) fairly presents the results of operations, retained
earnings or cash flows, as the case may be, of the Company for the periods set
forth therein (subject, in the case of unaudited statements, to normal year-end
audit adjustments which would not be material in amount or effect), in each case
in accordance with generally accepted accounting principles consistently applied
during the periods involved, except
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as may be noted therein and except, in the case of any unaudited statements, as
permitted by Form 10-Q promulgated under the Exchange Act.
(d) Neither the execution and delivery of this Agreement nor compliance
with the terms and provisions of this Agreement will violate any law, statute,
rule or regulation of any governmental authority, or will on the Closing Date
conflict with or result in a breach of any of the terms, conditions or
provisions of any judgment, order, injunction, decree or ruling of any court or
governmental agency, authority to which the Company is subject or of any
agreement or instrument to which the Company is a party.
(e) The execution, delivery and performance of this Agreement have been
duly and validly authorized and approved by all requisite corporate action on
the part of the Company. This Agreement has been, and the other agreements
contemplated hereby when executed and delivered will be, duly executed and
delivered by the Company and, assuming the due authorization, execution and
delivery hereof and thereof by the other parties hereto or thereto, this
Agreement constitutes and, when executed, each of the other agreements
contemplated hereby will constitute, a valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms subject to
applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent
conveyance and similar laws affecting creditors' rights generally from time to
time and to general principles of equity.
(f) There is no litigation, proceeding or investigation pending or, to
the knowledge of the Company threatened against or affecting the Company that
questions the validity or enforceability of this Agreement or any other
document, instrument or agreement to be executed and delivered by either the
Company or CEMI in connection with the transactions contemplated hereby.
(g) No vote of the holders of any class or series of the Company's
capital stock or other voting securities is necessary to approve this Agreement
or the transactions contemplated hereby.
(h) As of the Closing Date CEMI is solvent.
SECTION 11. MISCELLANEOUS
(a) Remedies. The Company acknowledges and agrees that any failure by
the Company to comply with its obligations under Section 3 hereof may result in
material irreparable injury to the Certificate Holder or the Holders for which
there is no adequate remedy at law, that it will not be possible to measure
damages for such injuries precisely and that, in the event of any such failure,
the Certificate Holder or any Holder may obtain such relief as may be required
to specifically enforce the Company's obligations under Section 3 hereof. The
Company further agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not, on or after the
date of this Agreement, enter into any agreement with respect to its securities
that is inconsistent with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof. The Company has not previously
entered into any agreement (which has not expired or been terminated) granting
any registration rights with respect to its securities to any Person. The rights
granted to the
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Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to the holders of the Company's securities under any
agreement in effect on the date hereof.
(c) No Piggybacks on Shelf Registration Statement. The Company shall
not grant to any of its security holders (other than the holders of Transfer
Restricted Securities in such capacity) the right to include any of their
securities in the Shelf Registration Statement other than the Transfer
Restricted Securities.
(d) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to or departures from
the provisions hereof may not be given unless (i) in the case of Section 3
hereof and this Section 10(d)(i), the Company has obtained the written consent
of Holders of all outstanding Transfer Restricted Securities and (ii) in the
case of all other provisions hereof, the Company has obtained the written
consent of Holders of Shares representing a majority of the outstanding Transfer
Restricted Securities (excluding Transfer Restricted Securities held by the
Company or its Affiliates).
(e) Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company, on the one
hand, and the Certificate Holder, on the other hand, and shall have the right to
enforce such agreements directly to the extent they may deem such enforcement
necessary or advisable to protect their rights hereunder.
(f) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
(i) if to a Holder, to the address set forth on the records of
either the Registrar with respect to the Shares or The Depository
Trust Company, as the case may be;
(ii) if to the Company: to Chesapeake Energy Corporation, ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Corporate Secretary, with a copy to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
P.C., 5400 Renaissance Tower, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇; and
(iii) if to the Certificate Holder: to Paribas North America,
Inc. ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Mr.
▇▇▇▇▇▇ ▇▇▇▇▇ or in any case to such other address as the Person to
be notified may have requested in writing.
All such notices and communications shall be deemed to have been duly given: at
the time delivered by hand, if personally delivered; five (5) Business Days
after being deposited in the mail, postage prepaid, if mailed; when receipt is
acknowledged, if telecopied; and on the next business day, if timely delivered
to an air courier guaranteeing overnight delivery.
(g) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the
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need for an express assignment, subsequent Holders of Transfer Restricted
Securities; provided, that nothing herein shall be deemed to permit any
assignment, transfer or other disposition of Transfer Restricted Securities in
violation of the terms hereof or of the Purchase Agreement. If any transferee of
any Holder shall acquire Transfer Restricted Securities in any manner, whether
by operation of law or otherwise, such Transfer Restricted Securities shall be
held subject to all of the terms of this Agreement, and by taking and holding
such Transfer Restricted Securities such Person shall be conclusively deemed to
have agreed to be bound by and to perform all of the terms and provisions of
this Agreement, including the restrictions on resale set forth in this Agreement
and the Purchase Agreement, and such Person shall be entitled to receive the
benefits hereof.
(h) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
(k) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(l) Entire Agreement. This Agreement, together with the Purchase
Agreement, is intended by the parties as a final expression of their agreement
and intended to be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter contained
herein. There are no restrictions, promises, warranties or undertakings, other
than those set forth or referred to herein with respect to the registration
rights granted with respect to the Transfer Restricted Securities. This
Agreement supersedes all prior agreements and understandings between the parties
with respect to such subject matter.
(m) Common Stock Issuance. Under the terms of paragraph 10.1 of the
Purchase Agreement, CEMI is obligated to cause the issuance of additional shares
of Common Stock or to pay additional cash to the Certificate Holder under
certain circumstances. The Company agrees to reserve sufficient shares to
satisfy any such obligations, to list such shares of Common Stock with the New
York Stock Exchange as provided herein and to include such shares in the Shelf
Registration Statement. If CEMI does not satisfy the obligations under paragraph
10.1 of the Purchase Agreement by issuing the required shares of Common Stock or
paying the required amount of cash, the Company will issue the number of shares
of Common Stock directly to the Certificate Holder required to satisfy such
obligations under the Purchase Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
CHESAPEAKE ENERGY CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Chief Executive Officer
PARIBAS NORTH AMERICA, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
---------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
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Title: Director
------------------------------------------
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------------
Title: Managing Director
------------------------------------------
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