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EXHIBIT 10.21
COMMON STOCK REGISTRATION RIGHTS AGREEMENT
Common Stock Registration Rights Agreement (the "Agreement"), dated as of
October 26, 1999, by and among Anker Coal Group, Inc., a Delaware corporation
(the "Company); and the Purchaser or Purchasers and Exchanging Noteholders
(collectively, the "Purchasers") named in the Exchange and Purchase Agreement
(the "Purchase Agreement") dated as of October 26, 1999 among the Company, the
Guarantors named therein and the Purchasers listed in Schedule I. This Agreement
is being entered into pursuant to the Purchase Agreement. Pursuant to the
Purchase Agreement, the Purchasers received Warrants issued in accordance with a
Warrant Agreement dated as of October 26, 1999 between the Company and The Bank
of New York, as warrant agent (the "Warrant Agreement") to purchase an aggregate
of 3,047 shares of the Company's Common Stock.
In consideration of the following premises and conditions, the parties
hereby agree as follows:
1. DEFINITIONS. As used in this Agreement, the following terms shall
have the following respective meanings:
The term "Common Stock" shall mean the Common Stock, par value $.01 per
share of the Company.
The term "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, or any similar federal statute then in effect, and a reference to a
particular section thereof shall be deemed to include a reference to the
comparable section, if any, of any such similar federal statute.
The term "Existing Stockholders" means the stockholders of the Company as
of September 30, 1999 that are parties to or entitled to the benefits of the
Registration Rights Agreement dated August 12, 1996 among the Company and the
Existing Stockholders or their predecessors in interest.
The term "Existing Stockholder Registrable Securities" means the shares
of Common Stock held by the Existing Stockholders.
The term "Holders" shall mean each Purchaser or other person or entity
which acquires Common Stock upon exercise of Warrants or to whom Common Stock is
otherwise hereafter transferred by any Purchaser other than any transfer in
violation of the Investor Agreement (the "Investor Agreement") entered into
among the parties hereto on or about the date hereof (such transferees
hereinafter "Permitted Transferees"), and any combination of them, and the term
"Holder" shall mean any such person.
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The term "person" shall mean an individual, partnership, corporation,
limited liability company, trust, unincorporated organization or government or
political department or agency thereof or other entity.
The term "Registrable Securities" shall mean shares of Common Stock
issuable upon exercise of Warrants outstanding as of the date hereof or acquired
by any of the Holders pursuant to the Purchase Agreement or otherwise acquired
by a Holder after the date hereof (but excluding the Warrants and any other
warrants or securities convertible into Common Stock). As to any Registrable
Securities, such securities shall cease to be Registrable Securities when (i)
such securities shall have been registered under the Securities Act, the
registration statement with respect to the sale of such securities shall have
become effective under the Securities Act and such securities shall have been
disposed of pursuant to such effective registration statement, (ii) such
securities shall have been distributed pursuant to Rule 144, or any successor
provision then in force, under the Securities Act, (iii) such securities shall
have been otherwise transferred, new certificates or other evidences of
ownership for them not bearing a legend restricting further transfer and not
subject to any stop transfer order or other restrictions on transfer shall have
been delivered by the Company and subsequent disposition of such securities
shall not require registration or qualification of such securities under the
Securities Act or any state securities laws then in force or (iv) such
securities shall cease to be Outstanding.
The term "Registration Expenses" shall mean all expenses incident to the
Company's performance of or compliance with this Agreement, including without
limitation, all SEC and stock exchange or National Association of Securities
Dealers, Inc. registration and filing fees and expenses, fees and expenses of
compliance with securities or blue sky laws (including reasonable fees and
disbursements of counsel for the underwriters in connection with blue sky
qualifications of the Registrable Securities), printing expenses, messenger and
delivery expenses, internal expenses (including without limitation, all salaries
and expenses of its officers and employees performing legal or accounting
duties), the fees and expenses incurred in connection with the listing of the
securities to be registered on each securities exchange on which such securities
are listed, fees and disbursements of counsel for the Company and all
independent certified public accountants (including the expenses of any annual
audit or "cold comfort" letters required by or incident to such performance and
compliance) , the fees and disbursements of underwriters customarily paid by
issuers or sellers of securities, the reasonable fees of one counsel retained in
connection with each such registration by the Holders of a majority of the
Registrable Securities being registered in an amount for each such registration
of up to a maximum of $25,000, the reasonable fees of counsel retained by a
Holder of Registrable Securities representing at least 25% of the then
Outstanding Registrable Securities being registered not voting in favor of the
retention of the counsel referred to in the preceding clause up to a maximum
amount of $10,000 per such Holder and only to the extent that such fees relate
to the performance of legal services required by the Company or an underwriter
to be performed by counsel to such Holder, the reasonable fees and expenses of
any special experts retained by the Company in connection with such registration
and fees and expenses of other persons retained by the Company (but not
including (i) any underwriting discounts or commissions attributable to the sale
of Registrable
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Securities by the Holders of such Registrable Securities and (ii) any transfer
taxes payable by the Holders of Registrable Securities in connection with the
sale of Registrable Securities).
The term "Securities Act" shall mean the Securities Act of 1933, as
amended, or any similar federal statute then in effect, and a reference to a
particular section thereof shall be deemed to include a reference to the
comparable section, if any, of any such similar federal statute.
The term "SEC" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act or the
Exchange Act.
2. REGISTRATION ON REQUEST.
(a) Request for Registration. At any time after the earlier of the
occurrence of an initial public offering by the Company or October 30, 2002,
upon the written request of any Holder or Holders holding at least 25% of the
Registrable Securities (the "Requesting Holder" or the "Requesting Holders")
requesting that the Company effect the registration under the Securities Act of
all or part of such Holder's or Holders' Registrable Securities and specifying
the intended method of disposition thereof, the Company will promptly give
written notice of such requested registration to all other Holders of
Registrable Securities, and thereupon will, as expeditiously as possible, use
its best efforts to effect the registration under the Securities Act of:
(i) the Registrable Securities which the Company has been so
requested to register by the Requesting Holder(s); and
(ii) all other Registrable Securities which the Company has been
requested to register by any other Holder thereof by written request
given to the Company within 20 days after the giving of such written
notice by the Company (which request shall specify the intended method of
disposition of such Registrable Securities)
all to the extent necessary to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities so to be
registered; provided, that the Company shall only be obligated to register such
Registrable Securities pursuant to a request by the Holders on an aggregate of
two registration statements, and provided further that (A) the Company shall not
be obligated to file a registration statement relating to a registration request
under this Section 2 at any time prior to the earlier of (i) October 30, 2002
and (ii) the completion of an initial public offering by the Company of Common
Stock, (B) the Company shall not be obligated to file a registration statement
relating to a registration request under this Section 2 (other than on Form S-3
or any similar short-form registration statement) within a period of six months
after the effective date of any other registration statement of the Company
which was not effected on Form S-3 (or any similar short-form registration
statement) and (C) if the Requesting Holder(s) shall have requested the Company
to effect a registration under this Section 2 and prior to the effective date of
the registration statement relating to such registration such Holders shall have
revoked such request pursuant to the last sentence of this Section 2 (a), then
the Company shall not be obligated to file a registration statement relating to
a registration request under this Section 2 within a period of six
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months after the date of receipt by the Company of the registration request that
was subsequently revoked; provided, however, that a request which is revoked
pursuant to the last sentence of this Section 2(a) shall not be considered a
request for these purposes. Promptly after the expiration of the 20-day period
referred to in subsection (ii) above, the Company will notify all the Holders to
be included in the registration of the other Holders and the number of shares of
Registrable Securities requested to be included therein. All of the Requesting
Holders acting jointly may, at any time prior to the effective date of the
registration statement relating to such registration, revoke such request by
providing a written notice to the Company revoking such request.
The Company shall have the right to select the investment banker (or
investment bankers) that shall manage the offering (collectively, the "managing
underwriter"), provided, that such managing underwriter must be reasonably
satisfactory to the Requesting Holder(s).
(b) Registration Statement Form. If a registration requested pursuant
to this Section 2 which is proposed by the Company to be effected by the filing
of a registration statement on Form S-3 (or any successor or similar short-form
registration statement) shall be in connection with any underwritten public
offering and if the managing underwriter shall advise the Company in writing
that, in its opinion, the use of another form of registration statement is of
material importance to the success of such proposed offering, then such
registration shall be effected on such other form.
(c) Expenses. The Company will pay the Registration Expenses in
connection with a registration requested pursuant to this Section 2, whether or
not such registration becomes effective under the Securities Act.
(d) Effective Registration Statement. A registration requested
pursuant to this Section 2 will not be deemed to have been effected unless the
registration statement relating thereto has become effective under the
Securities Act and all or any portion of the Registrable Securities initially
requesting such registration have actually been sold thereunder; provided,
however, that if, after such registration statement has become effective,
registration is interfered with by any stop order, injunction or other order or
requirement of the SEC or other governmental agency or court, such registration
will be deemed not to have been effected.
(e) Pro Rata Participation in Requested Registration. If a requested
registration pursuant to this Section 2 involves an underwritten offering and
the managing underwriter shall advise the Company in writing that, in its
opinion, the number of securities requested to be included in such registration
(including securities of the Company which are not Registrable Securities)
exceeds the number which would have an adverse effect on such offering,
including the price at which such shares or securities can be sold, the Company
will include in such registration (i) first, all Registrable Securities
requested to be included in such registration by the Requesting Holders pursuant
to this Section 2 (provided that if the number of such Registrable Securities
exceeds the number which the Company has been advised can be sold in such
offering, without having the adverse effect referred to above, the number of
such Registrable Securities included in such registration shall be allocated pro
rata among the Requesting Holders on the basis of the relative number of shares
of Registrable Securities each such Holder has
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requested to be included in such registration) , and (ii) second, to the extent
that the Registrable Securities requested to be included in such registration
pursuant to this Section 2 are less than the number of securities which the
Company has been advised can be sold in such offering, without having the
adverse effect referred to above, the securities proposed to be sold by other
Holders, allocated pro rata among such other Holders on the basis of the number
of shares of Registrable Securities each such Holder has requested to be
included in such registration. If at least fifty percent of the Registrable
Securities requested to be registered pursuant to Section 2(a) by the Requesting
Holders are not included in such registration, the registration request of such
Requesting Holders shall not be counted toward the limit on registration
requests set forth in Section 2(a).
3. INCIDENTAL REGISTRATION.
(a) Right to Include Registrable Securities. If the Company at any
time proposes to register any of its securities under the Securities Act (other
than a registration on Form S-4 or S-8 or any successor or similar forms and
other than pursuant to a registration under Section 2 hereof) , whether or not
for sale for its own account, it will each such time give prompt written notice
to all Holders of Registrable Securities of its intention to do so and of such
Holders' rights under this Section 3. Upon the written request of any such
Holder made within 20 days after the receipt of any such notice (which request
shall specify the Registrable Securities intended to be disposed of by such
Holder and the intended method of disposition thereof) , the Company will use
its best efforts to effect the registration under the Securities Act of all
Registrable Securities which the Company has been so requested to register by
the Holders thereof, to the extent requisite to permit the disposition (in
accordance with such intended methods thereof) of the Registrable Securities so
to be registered; provided, that (i) if, at any time after giving written notice
of its intention to register any securities and prior to the effective date of
the registration statement filed in connection with such registration, the
Company shall determine for any reason not to register such securities, the
Company may, at its election, give written notice of such determination to each
Holder that made a request as hereinabove provided and thereupon the Company
shall be relieved of its obligation to register any Registrable Securities in
connection with such registration, and (ii) if such registration involves an
underwritten offering, all Holders of Registrable Securities requesting to be
included in the Company's registration must sell their Registrable Securities to
the underwriters selected by the Company on the same terms and conditions as
apply to the Company. If a registration requested pursuant to this Section 3(a)
involves an underwritten public offering, any Holder of Registrable Securities
requesting to be included in such registration may elect, in writing prior to
the effectiveness of the registration statement filed in connection with such
registration, not to register such securities in connection with such
registration. No registration effected under this Section 3 shall relieve the
Company of its obligations to effect registration upon request under Section 2.
The Company will pay all Registration Expenses in connection with each
registration of Registrable Securities requested pursuant to this Section 3.
(b) Priority in Incidental Registrations. If a registration pursuant
to this Section 3 involves an underwritten offering and the managing underwriter
advises the Company in writing
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that, in its opinion, the number of securities which the Company, the Holders
and any other persons intend to include in such registration exceeds the number
which would have an adverse effect on such offering, including the price at
which such securities can be sold, the Company will include in such registration
(i) first, all the securities the Company proposes to sell for its own account,
and (ii) second, the number of Registrable Securities requested to be included
in such registration by the Holders and the number of Existing Stockholder
Registrable Securities requested to be included in such registration by the
Existing Stockholders, which number, in the opinion of such underwriters, can be
sold without having the adverse effect referred to above, such amount to be
allocated pro rata among all such requesting Holders and requesting Existing
Stockholders on the basis of the relative number of shares of Registrable
Securities and other securities each Holder and the number of shares of Existing
Stockholder Registrable Securities each Existing Stockholder has requested to be
included in such registration, and (iii) third, the number of shares requested
to be included in such registration by persons other than Holders and Existing
Stockholders, which number, in the opinion of such underwriters, can be sold
without having the adverse effect referred to above, such amount to be allocated
pro rata among all such requesting other persons on the basis of the relative
number of shares each such other person has requested to be included in such
registration.
4. HOLDBACK AGREEMENTS.
If any registration shall be in connection with an underwritten public
offering, each Holder of Registrable Securities agrees not to effect any public
sale or distribution, including any sale pursuant to Rule 144 or Rule 144A under
the securities Act, of any Registrable Securities, and to use such Holder's best
efforts not to effect any such public sale or distribution of any other equity
security of the Company or of any security convertible into or exchangeable or
exercisable for any equity security, of the Company (in each case, other than as
part of such underwritten public offering) within 7 days before or 90 days after
the effective date of such registration, and the Company hereby also so agrees
and agrees to cause other holders of any equity security, or of any security
convertible into or exchangeable or exercisable for any equity security, of the
Company purchased from the Company (at any time other than in a public offering)
to so agree.
5. REGISTRATION PROCEDURES.
If and whenever the Company is required to use its best efforts to effect
or cause the registration of any Registrable Securities under the Securities Act
as provided in this Agreement, the Company will, as expeditiously as possible:
(a) prepare and file with the SEC within 90 days, and use its best
efforts to prepare and so file within 45 days, after receipt of a request for
registration with respect to such Registrable Securities, a registration
statement on any form for which the Company then qualifies or which counsel for
the Company shall deem appropriate, subject to 2(b) hereof, as the case may be,
and which form shall be available for the sale of the registrable Securities in
accordance with the intended methods of distribution thereof, and use its best
efforts to cause such registration statement to become effective; provided that
before filing with the SEC a
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registration statement or prospectus or any amendments or supplements thereto,
the Company will (i) furnish to one counsel selected by the Holders of a
majority of the Registrable Securities covered by such registration statement
copies of all such documents proposed to be filed, which documents will be
subject to the review of such counsel, and the Company will give reasonable
consideration to any comments of such counsel, and (ii) notify each Holder of
Registrable Securities covered by such registration statement of any stop order
issued or threatened by the SEC and take all reasonable actions required to
prevent the entry of such stop order or to remove it if entered;
(b) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective for a period of
not less than 120 days or such shorter period which will terminate when all
Registrable Securities covered by such registration statement have been sold
(but not before the expiration of the 90-day period referred to in Section 4(3)
of the Securities Act and Rule 174 thereunder, if applicable), and comply with
the provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the sellers thereof set
forth in such registration statement;
(c) furnish to each Holder of such Registrable Securities covered by
such registration statement such number of copies of such registration
statement, each amendment and supplement thereto (in each case including all
exhibits thereto), the prospectus included in such registration statement
(including each preliminary prospectus) , in conformity with the requirements of
the Securities Act and such other documents as such Holder may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such Holder;
(d) use its best efforts to register or qualify such Registrable
securities under such other securities or blue sky laws of such jurisdictions
within the United States as any Holder of Registrable Securities covered by such
registration statement reasonably requests and do any and all other acts and
things which may be reasonably necessary or advisable to enable such Holder to
consummate the disposition in such jurisdictions of the Registrable Securities
owned by such Holder; provided that the Company will not be required to (i)
qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this paragraph (d), (ii) subject itself
to taxation in any such jurisdiction or (iii) consent to general service of
process in any such jurisdiction;
(e) use its best efforts to cause the Registrable Securities covered
by such registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the Holder or
Holders thereof to consummate the disposition of such Registrable Securities;
(f) immediately notify each Holder of such Registrable Securities at
any time when a prospectus relating thereto is required to be delivered under
the Securities Act, of the happening of any event as a result of which the
Prospectus included in such registration statement contains an untrue statement
of a material fact or omits to state any material fact required to be stated
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therein or necessary to make the statements therein not misleading in light of
the circumstances then existing, and will promptly prepare and furnish to such
Holder a reasonable number of copies of such supplement or amendment to such
prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading in light of the
circumstances then existing;
(g) use its best efforts to cause all such Registrable Securities to
be listed on a national securities exchange and on each securities exchange on
which similar securities issued by the Company are then listed, if the
applicable listing requirements are satisfied, and to provide a transfer agent
and registrar for such Registrable Securities covered by such registration
statement no later than the effective date of such registration statement;
(h) enter into such customary agreements (including an underwriting
agreement in customary form) and take all such other actions as the Holders of a
majority of the registrable Securities being sold or the underwriters retained
by such Holders, if any, reasonably request in order to expedite or facilitate
the disposition of such Registrable Securities, including customary
indemnification;
(i) make available for inspection by any Holder of Registrable
securities covered by such registration statement, any underwriter participating
in any disposition pursuant to such registration statement, and any attorney,
accountant or other agent retained by any such Holder or underwriter
(collectively, the "Inspectors"), all financial and other records, pertinent
corporate documents and properties of the Company (collectively, the "Records")
as shall be reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company officers, directors and employees to
supply all information reasonably requested by any such Inspector in connection
with such registration statement;
(j) use its best efforts to obtain a cold comfort letter from the
Company's independent public accountants in customary form and covering such
matters of the type customarily covered by cold comfort letters as the Holders
of a majority of the Registrable Securities being sold reasonably request;
(k) otherwise use its best efforts to comply with all applicable rules
and regulations of the SEC, and make available to its security holders, as soon
as reasonably practicable, an earnings statement covering a period of at least
twelve months, beginning with the first month after the effective date of the
registration statement (as the term "effective date,, is defined in Rule 158 (c)
under the Securities Act), which earnings statement shall satisfy the provisions
of Section 11(a) of the Securities Act and Rule 158 thereunder; and
(l) obtain for delivery to the underwriter an opinion or opinions from
counsel for the Company in customary form and in form and scope reasonably
satisfactory to such underwriter and its counsel.
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The Company may require each Holder of Registrable Securities as to which
any registration is being effected to furnish to the Company such information
regarding the distribution of such Registrable Securities as the Company may
from time to time reasonably request in writing.
Each Holder of Registrable Securities agrees that, upon receipt of any
notice from the Company of the happening of any event of the kind described in
Section 5(f) hereof, such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to the registration statement covering such
Registrable securities until such Holder's receipt of the copies of the
supplemented or amended prospectus contemplated by Section 5(f) hereof, and, if
so directed by the Company, such Holder will 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 Registrable Securities
current at the time of receipt of such notice. In the event the Company shall
give any such notice, the period mentioned in Section 5(b) hereof shall be
extended by the greater of (i) three months or (ii) the number of days during
the period from and including the date of the giving of such notice pursuant to
Section 5 (f) hereof to and including the date when each Holder of Registrable
Securities covered by such registration statement shall have received the copies
of the supplemented or amended prospectus contemplated by section 5 (f) hereof.
If a registration pursuant to Section 2 involves an underwritten
offering, the Company agrees, if so required by the managing underwriter, not to
effect any public sale or distribution of any of its securities (other than
pursuant to Form S-4 or S-8) during a period commencing seven calendar days
before and ending 90 calendar days after the effective date of such
registration, except for such underwritten offering.
6. INDEMNIFICATION.
(a) Indemnification by the Company. In the event of any registration
of any securities of the Company under the Securities Act pursuant to Section 2
or 3 hereof, the Company will, and it hereby does, indemnify and hold harmless,
to the full extent permitted by law, each of the Holders of any Registrable
Securities covered by such registration statement, its directors and officers,
employees, agents, general partners, limited partners, managers and managing
directors thereof), each other person who participates as an underwriter in the
offering or sale of such securities and each other person, if any, who controls
such Holder or any such underwriter within the meaning of the Securities Act,
against any and all losses, claims, damages or liabilities, joint or several,
and expenses (including any amounts paid in any settlement effected with the
Company's consent) to which such Holder, any such director, officer, employee,
agent, general, limited partner, manager or managing director or any such
underwriter or controlling person may become subject under the Securities Act,
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions or proceedings in respect thereof) or expenses arise out of or are
based upon (a) any untrue statement or alleged untrue statement of any material
fact contained in any registration statement under which such securities were
registered under the Securities Act, any preliminary, final or summary
prospectus, or any amendment or supplement
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thereto, including all documents incorporated therein by reference or (b) 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, and
the Company will reimburse such Holder and each such director, officer,
employee, agent, general partner, limited partner, manager, managing director or
underwriter and controlling person for any legal or any other expenses
reasonably incurred by them in connection with investigating or defending such
loss, claim, liability, action or proceedings commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission, or any
alleged untrue statement or omission; provided, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability (or action or proceeding in respect thereof) or expenses arises out of
or is based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in such registration statement or amendment or supplement
thereto or in any such preliminary, final or summary prospectus in reliance upon
and in conformity with written information furnished to the Company through an
instrument duly executed by such Holder or underwriter specifically stating that
it is for use in the preparation thereof; and provided, further, that the
Company will not be liable to any person who participates as an underwriter in
the offering or sale of Registrable Securities or any other person, if any, who
controls such underwriter within the meaning of the Securities Act, under the
indemnity agreement in this Section 6 (a) with respect to any preliminary
prospectus as amended or supplemented as the case may be, to the extent that any
such loss, claim, damage or liability of such underwriter or controlling person
results from the fact that such underwriter sold Registrable Securities to a
person to whom there was not sent or given, at or prior to the written
confirmation of such sale, a copy of the final prospectus (including any
documents incorporated by reference therein), whichever is most recent, if the
Company has previously furnished copies thereof to such underwriter and such
final prospectus, as then amended or supplemented, has corrected any such
misstatement or omission. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Holder or any such
director, officer, employee, agent, general partner, limited partner, manager,
managing director, underwriter or controlling person and shall survive the
transfer of such securities by ouch Holder.
(b) Indemnification by the Holders. The Company may require, as a
condition to including any Registrable Securities in any registration statement
filed in accordance with Sections 2 and 3 hereof, that the Company shall have
received an undertaking reasonably satisfactory to it from the Holders of such
Registrable Securities or any underwriter, to indemnify and hold harmless (in
the same manner and to the same extent as set forth in subdivision (a) of this
Section 6) the Company and its controlling persons and all other prospective
sellers and their respective controlling persons with respect to any statement
or alleged statement in or omission or alleged omission from such registration
statement, any preliminary, final or summary prospectus contained therein, or
any amendment or supplement, if such statement or alleged statement or omission
or alleged omission was made in reliance upon and in conformity with written
information furnished to the Company through an instrument duly executed by such
Holder or underwriter specifically stating that it is for use in the preparation
of such registration statement, preliminary, final or summary prospectus or
amendment or supplement, or a document incorporated by reference into any of the
foregoing.
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Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or any of the Holders or any
of their respective directors, officers and controlling persons and shall
survive the transfer of such securities by such Holder; provided, however, that
no such Holder shall be liable under this Section 6 for any amounts exceeding
the product of the purchase price per Registrable Security and the number of
Registrable Securities being sold pursuant to such registration statement or
prospectus by such Holder.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified
party hereunder of written notice of the commencement of any action or
proceeding with respect to which a claim for indemnification may be made
pursuant to this Section 6, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party, give written notice to the
latter of the commencement of such action; provided, that the failure of any
indemnified party to give notice as provided herein shall not relieve the
indemnifying party of its obligations under the preceding subdivisions of this
Section 6, except to the extent that the indemnifying party is actually
materially prejudiced by such failure to give notice. In case any such action is
brought against an indemnified party, unless in such indemnified party's
reasonable judgement a conflict of interest between such indemnified and
indemnifying parties may exist in respect of such claim, the indemnifying party
will be entitled to participate in and to assume the defense thereof, jointly
with any other indemnified party similarly notified to the extent that it may
wish, with counsel reasonably satisfactory to such indemnified party, and after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party will not be liable to such
indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof, unless in such indemnified
party's reasonable judgment a conflict of interest between such indemnified and
indemnifying parties arises in respect of such claim after the assumption of the
defense thereof. No indemnifying party will consent to entry of any judgment or
enter into any settlement without the prior written consent of the indemnified
party (which consent shall not be unreasonably withheld) unless such settlement
requires no more than a monetary payment for which the indemnifying party agrees
to indemnify the indemnified party and includes a full, unconditional and
complete release of the indemnified party from all liability in respect to such
claim or litigation. The indemnified party shall be entitled to take control of
the defense of any claim as to which, in the reasonable judgment of the
indemnifying party's counsel, representation of both the indemnifying party and
the indemnified party would be inappropriate under the applicable standards of
.professional conduct due to actual or potential differing interests between
them. An indemnifying party who is not entitled to, or elects not to, assume the
defense of a claim will not be obligated to pay the fees and expenses of more
than one counsel for all parties indemnified by such indemnifying party with
respect to such claim, unless in the reasonable judgment of any indemnified
party a conflict of interest may exist between such indemnified party and any
other of such indemnified parties with respect to such claim, in which event the
indemnifying party shall be obligated to pay the fees and expenses of such
additional counsel or counsels.
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7. CONTRIBUTION.
In order to provide for just and equitable contribution in circumstances
under which the indemnity contemplated by Section 6 is for any reason not
available or insufficient for any reason to hold harmless an indemnified party
in respect of any losses, claims, damages or liabilities referred to therein,
the parties required to indemnify by the terms thereof shall contribute to the
aggregate losses, liabilities, claims, damages and expenses of the nature
contemplated by such indemnity agreement incurred by the Company, any Holder of
Registrable Securities and one or more of the underwriters. In determining the
amounts which the respective parties shall contribute, there shall be considered
the relative benefits received by each party from the offering of the
Registrable Securities by taking into account the portion of the proceeds of the
offering realized by each, and the relative fault of each party by taking into
account the parties' relative knowledge and access to information concerning the
matter with respect to which the claim was asserted, the opportunity to correct
and prevent any statement or omission and any other equitable consideration
appropriate under the circumstances. The Company and each Holder selling
securities agree with each other that no seller of Registrable Securities shall
be required to contribute any amount in excess of the amount such Holder would
have been required to pay to an indemnified party if the indemnity under Section
6 were available. The Company and each such Holder agree with each other and the
underwriters of the Registrable Securities, if requested by such underwriters,
that it would not be equitable if the amount of such contribution were
determined by pro rata or per capita allocation (even if the underwriters were
treated as one entity for such purpose) or for the underwriter's portion of such
contribution to exceed the percentage that the underwriters discount bears to
the initial public offering price of the Registrable Securities. For purposes of
this Section 7 each Person, if any, who controls an underwriter within the
meaning of Section 15 of the Securities Act shall have the same rights to
contribution as such underwriter, and each director and each officer of the
Company who signed the registration statement, and each person, if any, who
controls the Company or a seller of Registrable Securities within the meaning of
Section 15 of the Securities Act shall have the same rights to contribution as
the Company or a seller of Registrable Securities as the case may be.
8. MISCELLANEOUS.
(a) The Company will not hereafter enter into any agreement with
respect to its securities which is inconsistent with the rights granted to the
Holders of Registrable securities in this Agreement. Except as provided herein
and in the Existing Stockholders Registration Rights Agreement, the Company has
not entered into any agreement granting any registration rights with respect to
any of its equity securities to any person.
(b) The Company acknowledges and agrees that in the event of any
breach of this Agreement by it, the Holders would be irreparably harmed and
could not be made whole by monetary damages. The Company accordingly agrees to
waive the defense in any action for specific performance that a remedy at law
would be adequate and that the Holders, in addition to any other remedy to which
they may be entitled at law or in equity, shall be entitled to compel specified
performance of this Agreement in any action instituted in the United States
District
12
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Court for the Southern District of New York, or, in the event said
Court would not have jurisdiction for such action, in any court of the United
States or any state thereof having subject matter jurisdiction for such action.
The Company consents to personal jurisdiction in any such action brought in the
United States District Court for the District of Delaware or any such other
court and to service of process upon it or him in the manner set forth in
section 8(d) hereof.
(c) This Agreement, together with the Purchase Agreement, the Warrant
Agreement, the Warrants, and the Investor Agreement constitute the entire
agreement and understanding of the parties hereto in respect of the subject
matter contained herein, and there are no restrictions, promises,
representations, warranties, covenants, or undertakings with respect to the
subject matter hereof, other than those expressly set forth or referred to
herein or therein. This Agreement, the Purchase Agreement, the Warrant
Agreement, the Investor Agreement and the Warrants referred to herein supersede
all prior agreements and understandings between the parties hereto with respect
to the subject matter hereof.
(d) Any notice, request, instruction or other document to be given
hereunder by any party hereto to another party hereto shall be in writing, shall
be delivered personally or sent by registered mail, postage prepaid, return
receipt requested, to the address of the party set forth in Appendix I hereto
or, in the case of a Permitted Transferee, to the address set forth in the
written agreement executed pursuant to Section 8(g) hereof, or to such other
address as the party to whom notice is to be given may provide in a written
notice to the Company, a copy of which written notice shall be on file with the
Secretary. No notice shall be effective except upon actual delivery.
(e) The laws of the State of New York shall govern the interpretation,
validity and performance of the terms of this Agreement, regardless of the law
that might be applied under applicable principles of conflicts of laws.
(f) The invalidity or unenforceability of any provisions of this
Agreement in any jurisdiction shall not affect the validity or enforceability of
the remainder of this Agreement in that jurisdiction or the validity or
enforceability of this Agreement, including that provision, in any other
jurisdiction.
(g) Notwithstanding anything to the contrary contained in this
Agreement, no shares of Registrable Securities or any securities of the Company
convertible into, or exercisable or exchangeable for, Registrable Securities,
may be sold, transferred or otherwise disposed of to any Permitted Transferee,
unless such Permitted Transferee, prior to such sale, transfer or other
disposition, agrees in writing to be bound by the terms of this Agreement to the
same extent and in the same manner as the transferor of such shares or
securities, a copy of which agreement (which shall be in substantially the form
attached as Exhibit B to the Investor Agreement) shall be on file with the
Secretary of the Company.
(h) Nothing contained in this Agreement shall be deemed to be a waiver
of, or release from, any obligations any party hereto may have under, or any
restrictions on the transfer of Registrable Securities or other securities of
the Company imposed by, any other agreement
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including, but not limited to, the Purchase Agreement, the Warrant Agreement,
the Warrants and the Investor Agreement.
(i) Each of the Holders agrees that substantially the following legend
shall be placed on the certificates representing any shares of Registrable
Securities acquired by it:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
RESTRICTIONS CONTAINED IN AN INVESTOR AGREEMENT DATED AS OF
OCTOBER 26, 1999 AMONG THE COMPANY AND THE STOCKHOLDERS AND
PURCHASERS NAMED THEREIN. IN ADDITION, THESE SHARES ARE SUBJECT TO
CERTAIN PROVISIONS OF A STOCKHOLDERS AGREEMENT DATED AUGUST 12,
1996 AMONG CERTAIN STOCKHOLDERS OF THE COMPANY WHICH PROVISIONS
ARE REFERENCED IN SUCH INVESTOR AGREEEMENT. COPIES OF THE INVESTOR
AGREEMENT AND SUCH STOCKHOLDERS AGREEMENT ARE ON FILE AT THE
OFFICE OF THE SECRETARY OF THE COMPANY."
(j) The provisions of this Agreement shall be binding upon and accrue
to the benefit of the parties hereto and their respective heirs, successors and
assigns. Nothing expressed or mentioned in this Agreement is intended to, or
shall be construed to, give any person or entity, other than (i) the parties
hereto (ii) their respective successors and permitted assigns or (iii) the
persons and entities indemnified pursuant to Sections 6(a) and 6(b) (and then
only to the extent of such indemnification), any legal or equitable right,
remedy or claim under or in respect to this Agreement or any provision contained
herein. Notwithstanding the foregoing, neither this Agreement nor any right,
remedy, obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company or any Holder without the prior written consent of the
Company and such Holder; provided, however, that a Holder may assign his rights,
remedies, obligations and liabilities hereunder concurrently with a transfer of
his shares of Registrable Securities to a Permitted Transferee in accordance
with Section 8(g) hereof without obtaining the prior written consent of the
Company or the Holders specified in this Section 8(j)
(k) A default by any party to the Agreement in such party's compliance
with any of the conditions or covenants hereof or performance of any of the
obligations of such party hereunder shall not constitute a default by any other
party.
(l) This Agreement may not be amended, modified or supplemented and no
waivers of or consents to departures from the provisions hereof may be given
unless consented to in writing by the Company and each of the Holders affected
thereby.
(m) This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original but all of which shall constitute one and
the same Agreement.
(n) In any action or proceeding brought to enforce any provision of
this Agreement, or where any provision hereof is validly asserted as a defense,
the successful party shall be entitled to recover reasonable attorneys, fees in
addition to any other available remedy.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
ANKER COAL GROUP, INC.
By: /s/ P. ▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
Name: P. ▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
ROTHSCHILD RECOVERY FUND L.P.
By Rothschild Recovery Associates, L.L.C.,
General Partner
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇, Jr.
-------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇, Jr.
Title: Managing Member
AIG SPECIAL SITUATIONS HOLDING FUND LTD.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Director
Intrepid Management Company LLC
as Investment Manager
By: /s/ ▇▇▇▇▇▇ Consol
----------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Portfolio Manager
Pilgrim High Yield Fund
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Sr Vice President/Portfolio Manager
15
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PILGRIM INVESTMENTS INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Sr Vice President/Portfolio Manager
PROSPECT STREET HIGH INCOME
PORTFOLIO
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Portfolio Manager
▇▇▇▇▇▇ Investment Management Inc., ▇▇▇▇▇▇ Fiduciary
Trust Company, and The ▇▇▇▇▇▇ Advisory Company, Inc.
on behalf of their clients listed on Attachment A
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
PRUDENTIAL HIGH YIELD TOTAL RETURN
FUND
PRUDENTIAL HIGH YIELD FUND, INC.
PRUDENTIAL DISTRESSED SECURITIES
FUND, INC.
By: The Prudential Investment Corporation, as
Investment Advisor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Second Vice President
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THE PRUDENTIAL SERIES FUND, INC., HIGH
YIELD BOND PORTFOLIO
By: The Prudential Insurance Company of America,
as Investment Advisor
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Second Vice President
DREYFUS HIGH YIELD STRATEGIES FUND
By: The Dreyfus Corporation, as Investment
Manager
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
17
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SCHEDULE I
LIST OF PURCHASERS
Name of Purchaser
Rothschild Recovery Fund, L.P.
AIG Special Situations Holding Fund Ltd.
Pilgrim High Yield Fund
ML CLO XV Pilgrim America
ML CBO XX Pilgrim America
Prospect Street High Income Portfolio Inc.
The ▇▇▇▇▇▇ ▇▇▇▇▇▇ Fund of Boston
▇▇▇▇▇▇ Income Fund
▇▇▇▇▇▇ Equity Income Fund
▇▇▇▇▇▇ Balanced Retirement Fund
▇▇▇▇▇▇ High Yield Advantage Fund
▇▇▇▇▇▇ High Income Convertible and Bond Fund
▇▇▇▇▇▇ Variable Trust - ▇▇▇▇▇▇ VT High Yield Fund
▇▇▇▇▇▇ Variable Trust - ▇▇▇▇▇▇ VT Global Asset Allocation Fund
▇▇▇▇▇▇ Master Income Trust
▇▇▇▇▇▇ Premier Income Trust
▇▇▇▇▇▇ Master Intermediate Income Trust
▇▇▇▇▇▇ Diversified Income Trust
▇▇▇▇▇▇ Convertible Opportunities and Income Trust
▇▇▇▇▇▇ Asset Allocation Funds - Growth Portfolio
▇▇▇▇▇▇ Asset Allocation Funds - Balanced Portfolio
▇▇▇▇▇▇ Asset Allocation Funds - Conservative Portfolio
▇▇▇▇▇▇ Funds Trust - ▇▇▇▇▇▇ High Yield Trust II
Travelers Series Fund Inc. - ▇▇▇▇▇▇ Diversified Income Portfolio
Lincoln National Global Asset Allocation Fund, Inc.
▇▇▇▇▇▇ Variable Trust - ▇▇▇▇▇▇ VT Diversified Income Fund
▇▇▇▇▇▇ High Yield Managed Trust
▇▇▇▇▇▇ High Yield Fixed Income Fund, LLC
▇▇▇▇▇▇ Laboratories Annuity Retirement Plan
Strategic Global Fund - High Yield Fixed Income (▇▇▇▇▇▇) Fund
Southern Farm Bureau Annuity Insurance Company
19
Prudential High Yield Total Return Fund, Inc.
Prudential High Yield Fund, Inc.
Prudential Distressed Securities Fund, Inc.
The Prudential Series Fund, Inc. High Yield Bond Portfolio
Dreyfus High Yield Strategies Fund