REGISTRATION RIGHTS AGREEMENT
Dated as of May 20, 1997
by and between
XCL LTD.
and
▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
9.50% AMENDED SERIES A, CUMULATIVE CONVERTIBLE PREEFERRED STOCK
and
COMMON STOCK PURCHASE WARRANTS
TABLE OF CONTENTS
Page
1. Definitions 1
2. Shelf Registration 5
3. Shelf Registration Procedures 6
4. Shelf Registration Expenses 11
5. Indemnification 12
6. Rules 144 and 144A 15
7. Underwritten Registrations of Registrable
Securities 16
8. Registration of Registrable Securities 16
9. Miscellaneous 19
(a) No Inconsistent Agreements 19
(b) Adjustments Affecting Registrable Shelf
Securities or Registrable Securities 19
(c) Amendments and Waivers 19
(d) Notices 20
(e) Successors and Assigns 20
(f) Counterparts 20
(g) Headings 21
(h) Governing Law 21
(i) Severability 21
(j) Securities Held by the Issuer or Its
Affiliates 21
(k) Third Party Beneficiaries 21
(1) Entire Agreement 21
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made
and entered into as of May 20, 1997, by and between XCL Ltd., a
Delaware corporation (the "Company" or the "Issuer"), and
▇▇▇▇▇▇▇▇▇ & Company, Inc. (the "Initial Purchaser").
This Agreement is entered into in connection with the
Purchase Agreement, dated May 13, 1997, by and among the Company,
XCL-China Ltd., a Delaware corporation and wholly-owned
subsidiary of the Company and the Initial Purchaser (the
"Purchase Agreement") which provides for, among other things, the
issuance and sale to the Initial Purchaser of 294,118 units (the
"Units"), each consisting of one share of the Company's Amended
Series A, Cumulative Convertible Preferred Stock, par value $1.00
per share ("Amended Series A Preferred Stock"), and one warrant
(collectively, the "Warrants") to purchase 327 shares of common
stock, par value $0.01 per share, of the Company (the "Common
Stock"). In order to induce the Initial Purchaser to enter into
the Purchase Agreement, the Company has agreed to provide the
registration rights set forth in this Agreement for the benefit
of the Initial Purchaser and its direct and indirect transferees
and assigns. The execution and delivery of this Agreement is a
condition to the Initial Purchaser's obligation to purchase the
Units under the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the term "day", unless otherwise
expressly provided, shall mean a calendar day and following terms
shall have the following meanings:
Advice: See the last paragraph of Section 5.
Agreement: See the first introductory paragraph to this
Agreement.
Amended Series A Preferred Stock: See the second
introductory paragraph to this Agreement.
Business Day: A day that is not a Saturday, a Sunday, or a
day on which banking institutions in New York, New York or
Hartford, Connecticut are required to be closed.
Common Stock: See the second introductory paragraph to this
Agreement.
Company: See the first introductory paragraph to this
Agreement.
Conversion Shares: The shares of Common Stock issuable upon
conversion of the Amended Series A Preferred Stock included in
the Units.
Effectiveness Period: See Section 2(a).
Exchange Act: The Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated
thereunder.
Holder: Any registered holder of Registrable Shelf
Securities or Registrable Securities.
Indemnified Person: See Section 5(c).
Indemnifying Person: See Section 5(c).
Initial Conversion Date: The later of the first anniversary
of the Issue Date or such date on which the Company has reserved
or has available a sufficient number of shares of its Common
Stock to permit conversion of all the outstanding Amended
Series A Preferred Stock.
Initial Purchaser: See the first introductory paragraph to
this Agreement.
Initial Shelf Registration: See Section 2(a).
Inspectors: See Section 3(o).
Issue Date: The date on which the Units were sold to the
Initial Purchaser pursuant to the Purchase Agreement.
Issuer: See the first introductory paragraph to this
Agreement.
NASD: National Association of Securities Dealers, Inc.
Participant: See Section 5(a).
Person: An individual, trustee, corporation, partnership,
limited liability company, joint stock company, trust,
unincorporated association, union, business association, firm or
other legal entity.
Piggy-Back Registration: See Section 8(a).
Prospectus: The prospectus included in any Registration
Statement (including, without limitation, any prospectus subject
to completion and a prospectus that includes any information
previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented
by any prospectus supplement, with respect to the terms of the
offering of any portion of the Registrable Shelf Securities or
the Registrable Securities covered by such Registration
Statement, and all other amendments and supplements to such
prospectus, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by
reference in such prospectus.
Purchase Agreement: See the second introductory paragraph
to this Agreement.
Records: See Section 3(o).
Registrable Shelf Securities: Any of (i) the shares of
Amended Series A Preferred Stock included in the Units, the
Conversion Shares and the Warrant Shares and (ii) any other
securities issued or issuable with respect to any such Amended
Series A Preferred Stock, Conversion Shares or Warrant Shares by
way of stock dividends or stock splits or in connection with a
combination of shares, recapitalization, merger, consolidation or
other reorganization or otherwise.
Registrable Securities: Any of (i) the Conversion Shares,
(ii) the Warrant Shares (whether or not the related Warrants have
been exercised) and (iii) any other securities issued or issuable
with respect to any Conversion Shares or Warrant Shares by way of
stock dividends or stock splits or in connection with a
combination of shares, recapitalization, merger, consolidation or
other reorganization or otherwise. As to any particular
Registrable Securities, such securities shall cease to be
Registrable Securities when (i) a Registration Statement with
respect to the offering of such securities by the Holder thereof
shall have been declared effective under the Securities Act and
such securities shall have been disposed of by such Holder
pursuant to such Registration Statement, (ii) such securities are
eligible for sale to the public pursuant to Rule 144(k) (or an
similar provision then in force, but not Rule 144A) or are all
otherwise eligible for sale under Rule 144 by such Holder in the
current calendar quarter, (iii) such securities shall have been
otherwise transferred by such Holder and new certificates for
such securities not bearing a legend restricting further transfer
shall have been delivered by the Company or its transfer agent
and subsequent disposition of such securities shall not require
registration or qualification under the Securities Act or any
similar state law then in force or (iv) such securities shall
have ceased to be outstanding.
Registration Expenses: All expenses incident to the
Company's performance of or compliance with Section 8 of this
Agreement, including, without limitation, all SEC and stock
exchange or NASD registration and filing fees and expenses, fees
and expenses of compliance with securities or blue sky laws
(including, without limitation, reasonable fees and disbursements
of counsel for any underwriters in connection with blue sky
qualifications of the Registrable Securities), preparing,
printing, filing, duplicating and distributing a Warrants
Registration Statement and the related Prospectus, the cost of
printing stock certificates, the cost and charges of any transfer
agent, rating agency fees, printing expenses, messenger,
telephone and delivery expenses, fees and disbursements of any
counsel for the Company and all independent certified public
accountants, the fees and disbursements of underwriters
customarily paid by issuers or sellers or securities (but not
including any underwriting discounts or commissions or transfer
taxes, if any, attributable to the sale of Registrable Securities
by Selling Holders), fees and expenses of one counsel for the
Selling Holders and other reasonable out-of-pocket expenses of
the Selling Holders.
Registration Statement: Any appropriate registration
statement of the Issuer filed with the SEC under the Securities
Act that covers any of the Registrable Shelf Securities or the
Registrable Securities pursuant to the provisions of this
Agreement, including the Prospectus, amendments and supplements
to such registration statement, including post-effective
amendments, all exhibits, and all material incorporated by
reference or deemed to be incorporated by reference in such
registration statement.
Rule 144: Rule 144 promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule
(other than Rule 144A) or regulation hereafter adopted by the SEC
providing for offers and sales of securities made in compliance
therewith resulting in offers and sales by subsequent holders
that are not affiliates of an issuer of such securities being
free of the registration and prospectus delivery requirements of
the Securities Act.
Rule 144A: Rule 144A promulgated under the Securities Act,
as such Rule may be amended from time to time, or any similar
rule (other than Rule 144) or regulation hereafter adopted by the
SEC.
Rule 415: Rule 415 promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule
or regulation hereafter adopted by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and
the rules and regulations of the SEC promulgated thereunder.
Selling Holder: A Holder who is selling Registrable
Securities in accordance with Section 8 hereof.
Shelf Registration: See Section 2(b).
Subsequent Shelf Registration: See Section 2(b).
Trigger Date: The earlier of (i) December 1, 1997 and (ii)
the date of disbursement to the Company of funds in the Cash
Collateral Account (as defined in the Purchase Agreement).
Underwritten registration or underwritten offering: A
registration in which securities of one or more of the issuers
are sold to an underwriter for reoffering to the public.
Units: See the second introductory paragraph to this
Agreement.
Warrants: See the second introductory paragraph to this
Agreement.
Warrant Shares: The shares of Common Stock issuable upon
exercise of the Warrants.
2. Shelf Registration
(a) Shelf Registration. The Issuer shall file with the
SEC, within 60 days after the Trigger Date, a "Shelf"
Registration Statement for an offering to be made on a continuous
basis pursuant to Rule 415 covering all of the Registrable Shelf
Securities (the "Initial Shelf Registration"), and shall use its
best efforts to cause such Initial Shelf Registration to be
declared effective under the Securities Act within 150 days after
the Trigger Date. The Initial Shelf Registration shall be on
Form S-l or another appropriate form permitting registration of
such Registrable Shelf Securities for resale by Holders in the
manner or manners designated by them (including, without
limitation, one or more underwritten offerings). The Issuer
shall not permit any securities other than the Registrable Shelf
Securities to be included in any Shelf Registration (as defined
below). The Issuer shall use its best efforts to keep the
Initial Shelf Registration continuously effective under the
Securities Act until the date which is two years from the Issue
Date or such earlier date as may be then authorized under Rule
144(k) under the Securities Act (the "Effectiveness Period"), or
such shorter period ending when (i) all Registrable Shelf
Securities covered by the Initial Shelf Registration have been
sold in the manner set forth and as contemplated in the Initial
Shelf Registration or are otherwise eligible for sale under Rule
144 by the Holders without restriction by virtue of the operation
of the volume limitations set forth in such Rule or (ii) a
Subsequent Shelf Registration (as defined below) covering all of
the Registrable Shelf Securities has been declared effective
under the Securities Act.
(b) Subsequent Shelf Registrations. If the Initial
Shelf Registration or any Subsequent Shelf Registration ceases to
be effective for any reason at any time during the Effectiveness
Period (other than because of the sale of all of the securities
registered thereunder), the Issuer shall use its best efforts to
obtain the prompt withdrawal of any order suspending the
effectiveness thereof, and in any event shall within 45 days of
such cessation of effectiveness amend such Shelf Registration in
a manner to obtain the withdrawal of the order suspending the
effectiveness thereof, or file (and cause any then existing
Subsidiary Guarantor to file) an additional "shelf" Registration
Statement pursuant to Rule 415 covering all of the Registrable
Shelf Securities (a "Subsequent Shelf Registration"). If a
Subsequent Shelf Registration is filed, the Issuer shall use its
best efforts to cause the Subsequent Shelf Registration to be
declared effective as soon as practicable after such filing and
to keep such Subsequent Shelf Registration continuously effective
for a period equal to the number of days in the Effectiveness
Period less the aggregate number of days during which the Initial
Shelf Registration or any Subsequent Shelf Registrations was
previously continuously effective. As used herein the term
"Shelf Registration" means the Initial Shelf Registration and any
Subsequent Shelf Registration.
(c) Supplements and Amendments. The Issuer shall
promptly supplement and amend any Shelf Registration if required
by the rules, regulations or instructions applicable to the
registration form used for such Shelf Registration, if required
by the Securities Act, or if reasonably requested by the Holders
of a majority in aggregate liquidation amount of the shares of
Amended Series A Preferred Stock covered by such Shelf
Registration (or, if no such shares are so covered, then by the
Holders of a majority of the other securities covered thereby) or
by any underwriter of such securities.
3. Shelf Registration Procedures
In connection with the filing of any Registration Statement
pursuant to Section 2 hereof, the Issuer shall effect such
registration to permit the sale of such securities covered
thereby in accordance with the intended method or methods of
disposition thereof, and pursuant thereto and in connection with
any such Registration Statement filed by the Issuer hereunder,
the Issuer shall:
(a) Before filing any Registration Statement, the
Issuer shall, if requested, furnish to and afford the
Holders of the Registrable Shelf Securities, their counsel
and the managing underwriters, if any, a reasonable
opportunity to review copies of all such documents
(including copies of any documents to be incorporated by
reference therein and all exhibits thereto) proposed to be
filed (in each case at least five business days prior to
such filing). The Issuer shall not file any such
Registration Statement or any amendments or supplements
thereto if the Holders of a majority in aggregate
liquidation amount of the shares of Amended Series A
Preferred Stock covered by such Registration Statement (or,
if no such shares are so covered, then by the Holders of a
majority of the other securities covered thereby), their
counsel, or the managing underwriters, if any, shall
reasonably object.
(b) Prepare and file with the SEC such amendments
and post-effective amendments to each Shelf Registration as
may be necessary to keep such Registration Statement
continuously effective for the Effectiveness Period; cause
the related Prospectus to be supplemented by any Prospectus
supplement required by applicable law, and as so
supplemented to be filed pursuant to Rule 424 (or any
similar provisions then in force) promulgated under the
Securities Act; and comply with the provisions of the
Securities Act and the Exchange Act applicable to it with
respect to the disposition of all securities covered by such
Registration Statement as so amended or in such Prospectus
as so supplemented.
(c) Notify the selling Holders of Registrable Shelf
Securities, their counsel and the managing underwriters, if
any, promptly (but in any event within two business days),
(i) when a Prospectus or any Prospectus supplement or post-
effective amendment has been filed, and, with respect to a
Registration Statement or any post-effective amendment, when
the same has become effective (including in such notice a
written statement that any Holder may, upon request, obtain,
without charge, one conformed copy of such Registration
Statement or post-effective amendment including financial
statements and schedules, documents incorporated or deemed
to be incorporated by reference and exhibits), (ii) of the
issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement or of any order
preventing or suspending the use of any Prospectus or the
initiation of any proceedings for that purpose, (iii) if at
any time when a prospectus is required by the Securities Act
to be delivered in connection with sales of the Registrable
Shelf Securities the representations and warranties of the
Issuer contained in any agreement (including any
underwriting agreement) contemplated by Section 3(n) hereof
cease to be true and correct, (iv) of the receipt by the
Issuer of any notification with respect to the suspension of
the qualification or exemption from qualification of a
Registration Statement or any of the Shelf Securities for
offer or sale in any jurisdiction, or the initiation or
threatening of any proceeding for such purpose, (v) of the
happening of any event, the existence of any condition or
any information becoming known that makes any statement made
in such Registration Statement or related Prospectus or any
document incorporated or deemed to be incorporated therein
by reference untrue in any material respect or that requires
the making of any changes in, or amendments or supplements
to, such Registration Statement, Prospectus or documents so
that, in the case of the Registration Statement, it will not
contain any 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, and
that in the case of the Prospectus, it will not contain any
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, in light of the circumstances
under which they were made, not misleading, and (vi) of any
of the Issuer's reasonable determination that a post-
effective amendment to a Registration Statement would be
appropriate.
(d) Use its best efforts to prevent the issuance of
any order suspending the effectiveness of a Registration
Statement or of any order preventing or suspending the use
of a Prospectus or suspending the qualification (or
exemption from qualification) of any of the Registrable
Shelf Securities for sale in any jurisdiction, and, if any
such order is issued, to use its best efforts to obtain the
withdrawal of any such order at the earliest possible date.
(e) If requested by the managing underwriters, if
any, or the Holders of a majority in aggregate liquidation
amount of the shares of Amended Series A Preferred Stock
being sold in connection with an underwritten offering (or,
if no such shares are being so sold, then by the Holders of
a majority of the other securities being so sold), (i)
promptly as practicable incorporate in a prospectus
supplement or post-effective amendment such information or
revisions to information therein relating to such
underwriters or selling Holders as the managing
underwriters, if any, or such Holders or their counsel
reasonably request to be included or made therein and (ii)
make all required filings of such prospectus supplement or
such post-effective amendment as soon as practicable after
the Issuer has received notification of the matters to be
incorporated in such prospectus supplement or post-effective
amendment.
(f) Furnish to each selling Holder of Registrable
Shelf Securities who so requests and to counsel and each
managing underwriter, if any, without charge, one conformed
copy of the Registration Statement or Registration
Statements and each post-effective amendment thereto,
including financial statements and schedules, and, if
requested, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.
(g) Deliver to each selling Holder of Registrable
Shelf Securities, their respective counsel, and the
underwriters, if any, without charge, as many copies of the
Prospectus and each amendment or supplement thereto and any
documents incorporated by reference therein as such Persons
may reasonably request; and, subject to the last paragraph
of this Section 5, the Issuer hereby consents to the use of
such Prospectus and each amendment or supplement thereto by
each of the selling Holders of Registrable Shelf Securities,
and the underwriters or agents, if any, and dealers (if
any), in connection with the offering and sale of the
Registrable Shelf Securities covered by such Prospectus and
any amendment or supplement thereto.
(h) Prior to any public offering of Registrable
Shelf Securities, to use its best efforts to register or
qualify, and to cooperate with the selling Holders of
Registrable Shelf Securities, the underwriters, if any, and
their respective counsel in connection with the registration
or qualification (or exemption from such registration or
qualification) of such Registrable Shelf Securities for
offer and sale under the securities or Blue Sky laws of such
jurisdictions within the United States as any selling
Holder, or the managing underwriter or underwriters, if any,
reasonably request in writing; provided that where
Registrable Shelf Securities are offered other than through
an underwritten offering, the Issuer agrees to cause its
counsel to perform Blue Sky investigations and file any
registrations and qualifications required to be filed
pursuant to this Section 5(h); keep each such registration
or qualification (or exemption therefrom) effective during
the period such Registration Statement is required to be
kept effective and do any and all other acts or things
reasonably necessary or advisable to enable the disposition
in such jurisdictions of the Registrable Shelf Securities
covered by the applicable Registration Statement; provided
that the Issuer shall not be required to (A) qualify
generally to do business in any jurisdiction where it is not
then so qualified, (B) take any action that would subject it
to general service of process in any such jurisdiction where
it is not then so subject or (C) subject itself to taxation
in excess of a nominal dollar amount in any such
jurisdiction where it is not then so subject.
(i) Cooperate with the selling Holders of
Registrable Shelf Securities and the managing underwriter or
underwriters, if any, to facilitate the timely preparation
and delivery of certificates representing Registrable Shelf
Securities to be sold, which certificates shall not bear any
restrictive legends and shall be in a form eligible for
deposit with The Depository Trust Company; and enable such
Registrable Shelf Securities to be in such denominations and
registered in such names as the managing underwriter or
underwriters, if any, or Holders may reasonably request.
(j) Use its best efforts to cause the Registrable
Shelf Securities covered by any Registration Statement to be
registered with or approved by such governmental agencies or
authorities as may be necessary to enable the seller or
sellers thereof or the underwriters, if any, to consummate
the disposition of such Registrable Shelf Securities, except
as may be required solely as a consequence of the nature of
such selling Holder's business, in which case the Issuer
will cooperate in all reasonable respects with the filing of
such Registration Statement and the granting of such
approvals.
(k) Upon the occurrence of any event contemplated
by paragraph 3(c)(v) or 3(c)(vi) hereof, as promptly as
practicable prepare and (subject to Section 3(a) hereof)
file with the SEC, at the expense of the Issuer, a
supplement or post-effective amendment to the Registration
Statement or a supplement to the related Prospectus or any
document incorporated or deemed to be incorporated therein
by reference, or file any other required document so that,
as thereafter delivered to the purchasers of the Registrable
Shelf Securities being sold thereunder, any such Prospectus
will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(1) Use its best efforts to cause any Amended
Series A Preferred Stock covered by a Registration Statement
to be rated with the appropriate rating agencies, if so
requested by the Holders of a majority in aggregate
liquidation amount of the shares of Amended Series A
Preferred Stock covered by such Registration Statement or
the managing underwriter or underwriters, if any.
(m) [Intentionally omitted]
(n) In connection with an underwritten offering of
Registrable Shelf Securities pursuant to a Shelf
Registration, enter into an underwriting agreement as is
customary in underwritten offerings of securities similar to
the Registrable Shelf Securities and take all such other
actions as are reasonably requested by the managing
underwriter or underwriters in order to expedite or
facilitate the registration or the disposition of such
Registrable Shelf Securities and, in such connection, (i)
make such representations, warranties to, and covenants
with, the underwriters, with respect to the business of the
Issuer and its subsidiaries and the Registration Statement,
Prospectus and documents, if any, incorporated or deemed to
be incorporated by reference therein, in each case, as are
customarily made by issuers to underwriters in underwritten
offerings of securities similar to the Registrable Shelf
Securities, and confirm the same in writing if and when
requested; (ii) obtain the opinion of counsel to the Issuer
and updates thereof in form and substance reasonably
satisfactory to the managing underwriter or underwriters,
addressed to the underwriters covering the matters
customarily covered in opinions requested in underwritten
offerings of securities similar to the Registrable Shelf
Securities and such other matters as may be reasonably
requested by underwriters; (iii) obtain copies of "cold
comfort" letters and updates thereof in form and substance
reasonably satisfactory to the managing underwriter or
underwriters from the independent certified public
accountants of the Issuer (and, if necessary, any other
independent certified public accountants of any subsidiary
of the Issuer or of any business acquired by the Issuer for
which financial statements and financial data are, or are
required to be, included in the Registration Statement),
addressed to each of the underwriters, such letters to be in
customary form and covering matters of the type customarily
covered in "cold comfort" letters in connection with
underwritten offerings of securities similar to the
Registrable Shelf Securities and such other matters as
reasonably requested by the managing underwriter or
underwriters; and (iv) if an underwriting agreement is
entered into, the same shall contain indemnification
provisions and procedures no less favorable than those set
forth in Section ___ hereof with respect to all parties to
be indemnified pursuant to said Section. The above shall be
done at each closing under such underwriting agreement, or
as and to the extent required thereunder.
(o) Make available for inspection by any selling
Holder of such Registrable Shelf Securities being sold, any
underwriter participating in any such disposition of
Registrable Shelf Securities, if any, and any attorney,
accountant or other agent retained by any such selling
Holder, or underwriter (collectively, the "Inspectors"), at
the offices where normally kept, during reasonable business
hours, all financial and other records and pertinent
corporate documents of the Issuers and their respective
subsidiaries (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise any
applicable due diligence responsibilities, and cause the
officers, directors and employees of the Issuer and its
subsidiaries to supply all information reasonably requested
by any such Inspector in connection with such Registration
Statement. Such Records shall be kept confidential by each
Inspector and shall not be disclosed by the Inspectors
unless (i) the disclosure of such Records is necessary to
avoid or correct a misstatement or omission in such
Registration Statement, (ii) the release of such Records is
ordered pursuant to a subpoena or other order from a court
of competent jurisdiction, (iii) the information in such
Records is public or has been made generally available to
the public other than as a result of a disclosure or failure
to safeguard by such Inspector or (iv) disclosure of such
information is, in the opinion of counsel for any Inspector,
necessary or advisable in connection with any action, claim,
suit or proceeding, directly or indirectly, involving or
potentially involving such Inspector and arising out of,
based upon, related to, or involving this Agreement, or any
transactions contemplated hereby or arising hereunder. Each
selling Holder of such Registrable Shelf Securities will be
required to agree that information obtained by it as a
result of such inspections shall be deemed confidential and
shall not be used by it as the basis for any market
transactions in the securities of the Issuers unless and
until such is made generally available to the public. Each
selling Holder of such Registrable Shelf Securities will be
required to further agree that it will, upon learning that
disclosure of such Records is sought in a court of competent
jurisdiction, give notice to the Issuer and allow the Issuer
to undertake appropriate action to prevent disclosure of the
Records deemed confidential at their expense.
(p) [Intentionally omitted.]
(q) Comply with all applicable rules and
regulations of the SEC and make generally available to the
securityholders of the Company earnings statements
satisfying the provisions of Section 11(a) of the Securities
Act and Rule 158 thereunder (or any similar rule promulgated
under the Securities Act) no later than 45 days after the
end of any 12-month period (or 90 days after the end of any
12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which
Registrable Shelf Securities are sold to underwriters in a
firm commitment or best efforts underwritten offering and
(ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of
the Company after the effective date of a Registration
Statement, which statements shall cover said 12-month
periods.
(r) [Intentionally omitted.]
(s) [Intentionally omitted.]
(t) Cooperate with each seller of Registrable Shelf
Securities covered by any Registration Statement and each
underwriter, if any, participating in the disposition of
such Registrable Shelf Securities and their respective
counsel in connection with any filings required to be made
with the NASD.
(u) Use its best efforts to take all other steps
reasonably necessary to effect the registration of the
Registrable Shelf Securities covered by a Registration
Statement contemplated hereby.
The Issuer may require each seller of Registrable Shelf
Securities as to which any registration is being effected to
furnish to the Issuer such information regarding such seller and
the distribution of such Registrable Shelf Securities as the
Issuers may, from time to time, reasonably request. The Issuer
may exclude from such registration the Registrable Shelf
Securities of any seller who fails to furnish such information
within a reasonable time (which time in no event shall exceed 30
days) after receiving such request. Each seller as to which any
Shelf Registration is being effected agrees to furnish promptly
to the Issuer all information required to be disclosed in order
to make the information previously furnished to the Issuer by
such seller not materially misleading.
Each Holder of Registrable Shelf Securities agrees by
acquisition of such Registrable Shelf Securities that, upon
receipt of any notice from the Issuer of the happening of any
event of the kind described in Section 3(c)(ii), 3(c)(iv),
3(c)(v), or 3(c)(vi), such Holder will forthwith discontinue
disposition of such Registrable Shelf Securities covered by a
Registration Statement until such Holder's receipt of the copies
of the supplemented or amended Prospectus contemplated by Section
5(k), or until it is advised in writing (the "Advice") by the
Issuer that the use of the applicable Prospectus may be resumed,
and has received copies of any amendments or supplements thereto
and, if so directed by the Issuer, such Holder will deliver to
the Issuer 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 the receipt of such
notice.
4. Shelf Registration Expenses
(a) All fees and expenses incident to the performance of
or compliance with this Agreement by the Issuer (other than
Registration Expenses, which are dealt with exclusively in
Section 8 hereof) shall be borne by the Issuer, whether or not a
Shelf Registration is filed or becomes effective, including,
without limitation, (i) all registration and filing fees
(including, without limitation, (A) fees with respect to filings
required to be made with the NASD in connection with an
underwritten offering and (B) fees and expenses of compliance
with state securities or Blue Sky laws as provided in Section
3(h) hereof, (ii) printing expenses, including, without
limitation, expenses of printing prospectuses if the printing of
prospectuses is requested by the managing underwriter or
underwriters, if any, or by the Holders of a majority in
aggregate liquidation amount of the shares of Amended Series A
Preferred Stock included in any Registration Statement (or, if no
such shares are so included, then by the Holders of a majority of
the other securities included therein), as the case may be,
(iii)reasonable messenger, telephone and delivery expenses
incurred in connection with any Shelf Registration, (iv) fees and
disbursements of counsel for the Issuer and reasonable fees and
disbursements of special counsel for the sellers of Registrable
Shelf Securities (subject to the provisions of Section 4(b)), (v)
fees and disbursements of all independent certified public
accountants referred to in Section 3(n)(iii) (including, without
limitation, the expenses of any special audit and "cold comfort"
letters required by or incident to such performance), (vi) rating
agency fees, (vii) Securities Act liability insurance, if the
Issuer desires such insurance, (viii) fees and expenses of all
other Persons retained by the Issuers, (ix) internal expenses of
the Issuer (including, without limitation, all salaries and
expenses of officers and employees of the Issuer performing legal
or accounting duties), (x) the expense of any annual audit, (xi)
the fees and expenses incurred in connection with the listing of
the securities to be registered on any securities exchange and
(xii) the expenses relating to printing, word processing and
distributing all Registration Statements, underwriting
agreements, securities sales agreements, indentures and any other
documents necessary in order to comply with this Agreement.
(b) In connection with any Shelf Registration hereunder,
the Issuer shall reimburse the Holders of the Registrable Shelf
Securities being registered in such registration for the fees and
disbursements, not to exceed $25,000, of not more than one
counsel (in addition to appropriate local counsel) chosen by the
Holders of a majority in aggregate liquidation amount of the
shares of Amended Series A Preferred Stock to be included in such
Shelf Registration (or, if no such shares are so included, then
by the Holders of a majority of the other securities included
therein) and other out-of-pocket expenses of Holders of
Registrable Shelf Securities incurred in connection with the
registration and sale of Registrable Shelf Securities.
5. Indemnification
(a) The Issuer agrees to indemnify and hold harmless
each Holder of Registrable Shelf Securities and each Holder of
Registrable Securities, the officers and directors of each such
Person, and each Person, if any, who controls any such Person
within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act (each, a "Participant"), from and
against any and all losses, claims, damages and liabilities
(including, without limitation, the reasonable legal fees and
other reasonable expenses actually incurred in connection with
any suit, action or proceeding or any claim asserted) caused by,
arising out of or based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in any Registration
Statement (as amended or supplemented if the Issuer shall have
furnished any amendments or supplements thereto) or caused by,
arising out of or based upon 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, or (ii)
any untrue statement or alleged untrue statement of a material
fact contained in any Prospectus (as amended or supplemented if
the Issuer shall have furnished any amendments or supplements
thereto) or caused by, arising out of or based upon any omission
or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading, except insofar as such losses, claims, damages or
liabilities are caused by any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in
conformity with information relating to any Participant furnished
to the Issuer in writing by or on behalf of such Participant
expressly for use therein; provided, however, that the Company
will not be liable if such untrue statement or omission or
alleged untrue statement or omission was contained or made in any
preliminary prospectus and corrected in the Prospectus or any
amendment or supplement thereto and the Prospectus does not
contain any other untrue statement or omission or alleged untrue
statement or omission of a material fact that was the subject
matter of the related proceeding and any such loss, liability,
claim, damage or expense suffered or incurred by the Participants
resulted from any action, claim or suit by any Person who
purchased Registrable Shelf Securities or Registrable Securities
which are the subject thereof from such Participant and it is
established in the related proceeding that such Participant
failed to deliver or provide a copy of the Prospectus (as amended
or supplemented) to such Person with or prior to the confirmation
of the sale of such Registrable Shelf Securities or Registrable
Securities sold to such Person if required by applicable law,
unless such failure to deliver or provide a copy of the
Prospectus (as amended or supplemented) was a result of
noncompliance by the Issuer with Section 3 of this Agreement.
(b) Each Participant agrees, severally and not jointly,
to indemnify and hold harmless the Issuer, its directors and
officers and each Person who controls the Issuer within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from
the Issuer to each Participant, but only with reference to
information relating to such Participant furnished to the Issuer
in writing by such Participant expressly for use in any
Registration Statement or Prospectus, any amendment or supplement
thereto, or any preliminary prospectus. The liability of any
Participant under this paragraph shall in no event exceed the
proceeds received by such Participant from sales of Registrable
Shelf Securities or Registrable Securities giving rise to such
obligations.
(c) If any suit, action, proceeding (including any
governmental or regulatory investigation), claim or demand shall
be brought or asserted against any Person in respect of which
indemnity may be sought pursuant to either of the two preceding
paragraphs, such Person (the "Indemnified Person") shall promptly
notify the Person against whom such indemnity may be sought (the
"Indemnifying Person") in writing, and the Indemnifying Person,
upon request of the Indemnified Person, shall retain counsel
reasonably satisfactory to the Indemnified Person to represent
the Indemnified Person and any others the Indemnifying Person may
reasonably designate in such proceeding and shall pay the
reasonable fees and expenses actually incurred by such counsel
related to such proceeding; provided, however, that the failure
to so notify the Indemnifying Person shall not relieve it of any
obligation or liability which it may have hereunder or otherwise
(unless and only to the extent that such failure directly results
in the loss or compromise of any material rights or defenses by
the Indemnifying Person and the Indemnifying Person was not
otherwise aware of such action or claim). In any such
proceeding, any Indemnified Person shall have the right to retain
its own counsel, but the fees and expenses of such counsel shall
be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have
mutually agreed in writing to the contrary, (ii) the Indemnifying
Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person or (iii) the
named parties in any such proceeding (including any impleaded
parties) include both the Indemnifying Person and the Indemnified
Person and representation of both parties by the same counsel
would be inappropriate due to actual or potential differing
interests between them. It is understood that, unless there is a
conflict among Indemnified Persons, the Indemnifying Person shall
not, in connection with any proceeding or related proceeding in
the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel)
for all Indemnified Persons, and that all such fees and expenses
shall be reimbursed promptly after receipt of the invoice
therefor as they are incurred. Any such separate firm for the
Participants and such control Persons of Participants shall be
designated in writing by Participants who sold a majority in
interest of the securities sold by all such Participants and any
such separate firm for the Issuer, its directors, its officers
and such control Persons of the Issuer shall be designated in
writing by the Company. The Indemnifying Person shall not be
liable for any settlement of any proceeding effected without its
prior written consent, but if settled with such consent or if
there is a final non-appealable judgment for the plaintiff for
which the Indemnified Person is entitled to indemnification
pursuant to this Agreement, the Indemnifying Person agrees to
indemnify any Indemnified Person from and against any loss or
liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an
Indemnified Person shall have requested an Indemnifying Person to
reimburse the Indemnified Person for reasonable fees and expenses
actually incurred by counsel as contemplated by the third
sentence of this paragraph, the Indemnifying Person agrees that
it shall be liable for any settlement of any proceeding effected
without its prior written consent if (i) such settlement is
entered into more than 30 days after receipt by such Indemnifying
Person of the aforesaid request and (ii) such Indemnifying Person
shall not have reimbursed the Indemnified Person in accordance
with such request prior to the date of such settlement; provided,
however, that the Indemnifying Person shall not be liable for any
settlement effected without its consent pursuant to this sentence
if the Indemnifying Person is contesting, in good faith, the
request for reimbursement. No Indemnifying Person shall, without
the prior written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of
which any Indemnified Person is or could have been a party and
indemnity could have been sought hereunder by such Indemnified
Person, unless such settlement (A) includes an unconditional
release of such indemnified Person, in form and substance
satisfactory to such Indemnified Person, from all liability on
claims that are the subject matter of such proceeding and (B)
does not include any statement as to an admission of fault,
culpability or failure to act by or on behalf of an Indemnified
Person.
(d) If the indemnification provided for in the first and
second paragraphs of this Section 5 is unavailable (other than by
reason of the exceptions specifically provided therein) to, or
insufficient to hold harmless, an Indemnified Person in respect
of any losses, claims, damages or liabilities referred to
therein, then each Indemnifying Person under such paragraphs, in
lieu of indemnifying such Indemnified Person thereunder and in
order to provide for just and equitable contribution, shall
contribute to the amount paid or payable by such Indemnified
Person as a result of such losses, claims, damages or liabilities
in such proportion as is appropriate to reflect (i) the relative
benefits received by the Indemnifying Person or Persons on the
one hand and the Indemnified Person or Persons on the other from
the offering of the Registrable Shelf Securities or Registrable
Securities, as the case may be, or (ii) if the allocation
provided by the foregoing clause (i) is not permitted by
applicable law, not only such relative benefits but also the
relative fault of the Indemnifying Person or Persons on the one
hand and the Indemnified Person or Persons on the other in
connection with the statements or omissions (or alleged
statements or omissions) that resulted in such losses, claims,
damages or liabilities (or actions in respect thereof) as well as
any other relevant equitable considerations. The relative fault
of the parties 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 Issuers on
the one hand or by the Participants or such other Indemnified
Person, as the case may be, on the other, such Persons' relative
intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission and any other
equitable considerations appropriate under the circumstances.
(e) The parties agree that it would not be just and
equitable if contribution pursuant to this Section 5 were
determined by pro rata allocation (even if the Participants were
treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable
considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified Person
as a result of the losses, claims, damages and liabilities
referred to in the immediately preceding paragraph shall be
deemed to include, subject to the limitations set forth above,
any reasonable legal or other expenses actually incurred by such
Indemnified Person in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this
Section 5, in no event shall a Participant be required to
contribute any amount in excess of the amount by which proceeds
received by such Participant from sales of Registrable Shelf
Securities or Registrable Securities, as the case may be, exceeds
the amount of any damages that such Participant 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 meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any
Person who was not guilty of such fraudulent misrepresentation.
(f) The indemnity and contribution agreements contained
in this Section 5 will be in addition to any liability which the
Indemnifying Persons may otherwise have to the Indemnified
Persons referred to above.
6. Rules 144 and 144A
The Issuer covenants that it will file the reports required
to be filed by it under the Securities Act and the Exchange Act
and the rules and regulations adopted by the SEC thereunder in a
timely manner and, if at any time it is not required to file such
reports, it will, upon the request of any Holder of Registrable
Shelf Securities or Registrable Securities, make publicly
available other information so long as necessary to permit sales
pursuant to Rule 144 and Rule 144A. The Issuer further
covenants, for so long as any Registrable Shelf Securities or
Registrable Securities remain outstanding, to make available to
any Holder or beneficial owner thereof in connection with any
sale thereof and any prospective purchaser of such Registrable
Shelf Securities or Registrable Securities from such Holder or
beneficial owner, the information required by Rule 144A(d)(4)
under the Securities Act in order to permit resales of such
Registrable Shelf Securities or Registrable Securities pursuant
to Rule 144A.
7. Underwritten Registrations of Registrable Securities
If any of the Registrable Shelf Securities covered by any
Shelf Registration is to be sold in an underwritten offering, the
investment banker or investment bankers and manager or managers
that will manage the offering will be selected by the Holders of
a majority in aggregate liquidation amount of the shares of
Amended Series A Preferred Stock included in such offering (or,
if no such shares are so included, then by the Holders of a
majority of the other securities included therein) and reasonably
acceptable to the Issuer.
No Holder of Registrable Shelf Securities may participate in
any underwritten registration hereunder unless such Holder (a)
agrees to sell such Holder's Registrable Shelf Securities on the
basis provided in any underwriting arrangements approved by the
Persons entitled hereunder to approve such arrangements and (b)
completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements.
8. Registration of Registrable Securities
(a) Piggy-Back Registration of Registrable Securities.
If at any time after the Initial Conversion Date the Company
proposes to file a registration statement under the Securities
Act with respect to an offering by the Company for its own
account or for the account of any holders of its Common Stock
(other than (i) a registration statement on Form S-4 or S-8 (or
any substitute form that may be adopted by the SEC), (ii) a
registration statement filed in connection with an exchange offer
or offering of securities solely to the Company's existing
securityholders or (iii) any Registration Statement pursuant to
Section 2 hereof), then the Company shall give written notice of
such proposed filing to the Holders of Registrable Securities as
soon as practicable (but in no event fewer than 20 days before
the anticipated filing date), and such notice shall offer such
Holders the opportunity to register such number of Registrable
Securities as each Holder may request in writing within 20 days
after receipt of such written notice from the Company (which
request shall specify the Registrable Securities intended to be
disposed of by such Selling Holder and the intended method of
distribution thereof) (a "Piggy-Back Registration"). The Company
shall use its best efforts to keep such Piggy-Back Registration
continuously effective under the Securities Act until at least
the earlier of (A) an aggregate of 180 days after the effective
date thereof or (B) the consummation of the distribution by the
Holders of all of the Registrable Securities covered thereby.
The Company shall use its best efforts to cause the managing
underwriter or underwriters, if any, of such proposed offering to
permit the Registrable Securities requested to be included in a
Piggy-Back Registration to be included on the same terms and
conditions as any similar securities of the Company or any other
security holder included therein and to permit the sale or other
disposition of such Registrable Securities in accordance with the
intended method of distribution thereof. Any Selling Holder
shall have the right to withdraw its request for inclusion of its
Registrable Securities in any Registration Statement pursuant to
this Section 8 by giving written notice to the Company of its
request to withdraw at any time prior to the filing of such
Registration Statement with the SEC. The Company will pay all
Registration Expenses in connection with each registration of
Registrable Securities requested pursuant to this Section 8, and
each Holder of Registrable Securities shall pay all underwriting
discounts and commissions and transfer taxes, if any, relating to
the sale or disposition of such Holder's Registrable Securities
pursuant to a Piggy-Back Registration effected pursuant to this
Section 8.
No registration effected under this Section 8, and no
failure to effect a registration under this Section 8, shall
relieve the Company of its obligation to effect a registration
pursuant to Section 2 hereof, and no failure to effect a
registration under this Section 8 and to complete the sale of
securities registered thereunder in connection therewith shall
relieve the Company of any other obligation under this Agreement.
(b) Priority in Piggy-Back Registration. In a
registration pursuant to this Section 8 involving an underwritten
offering, if the managing underwriter or underwriters of such
underwritten offering have informed, in writing, the Company and
the Selling Holders requesting inclusion in such offering that in
such underwriter's or underwriters' opinion the total number of
securities which the Company, the Selling Holders and any other
Persons desiring to participate in such registration intend to
include in such offering is such as to adversely affect the
success of such offering, including the price at which such
securities can be sold, then the Company will be required to
include in such registration only the amount of securities which
it is so advised should be included in such registration. In
such event: (x) in cases initially involving the registration
for sale of securities for the Company's own account, securities
shall be registered in such offering in the following order of
priority: (i) first, the securities which the Company proposes to
register, (ii) second, provided that no securities proposed to be
registered by the Company have been excluded from such
registration, the securities which have been requested to be
included in such registration by the Selling Holders and by
Persons entitled to exercise "piggy-back" registration rights
pursuant to contractual commitments to "piggy-back" registration
rights of the Company entered into prior to, and in existence on,
the date hereof (pro rata based on the amount of securities
sought to be registered by such Persons), and (iii) third,
provided that no securities sought to be included by the Selling
Holders or such Persons have been excluded from such
registration, the securities of other Persons entitled to
exercise "piggyback" registration rights pursuant to contractual
commitments of the Company entered into subsequent to the date
hereof (pro rata based on the amount of securities sought to be
registered by such Persons); and (y) in cases not initially
involving the registration for sale of securities for the
Company's own account, securities shall be registered in such
offering in the following order of priority: (i) first, the
securities of any Person whose exercise of a "demand"
registration right pursuant to a contractual commitment of the
Company is the basis for the registration, (ii) second, provided
that no securities of any Person whose exercise of a "demand"
registration right pursuant to a contractual commitment of the
Company is the basis for such registration have been excluded
from such registration, the securities requested to be included
in such registration by the Selling Holders pursuant to this
Agreement and by Persons entitled to exercise "piggy-back"
registration rights pursuant to contractual commitments to "piggy-
back" registration rights of the Company entered into prior to,
and in existence on, the date hereof (pro rata based on the total
amount of securities sought to be included by such Persons),
(iii) third, provided that no securities sought to be included by
the Selling Holders or such Persons have been excluded from such
registration, securities of other Persons entitled to exercise
"piggy-back" registration rights pursuant to contractual
commitments entered into subsequent to the date hereof (pro rata
based on the amount of securities sought to be registered by such
Persons) and (iv) fourth, provided that no securities sought to
be included by other Persons entitled to exercise "piggy-back"
registration rights pursuant to such contractual commitments have
been excluded from such registration, any securities which the
Company proposes to register.
(c) Suspension of Sales, etc. Subject to the next
sentence of this paragraph, the Company shall be entitled to
postpone, for a reasonable period of time, the effectiveness of,
or suspend the rights of any Holders to make sales purchase to
any Registration Statement otherwise required to be prepared,
filed and made and kept effective by it under this Section 8;
provided, however, that the duration of such postponement or
suspension may not exceed the earlier to occur of (A) 15 days
after the cessation of the circumstances described in the next
sentence of this paragraph on which such postponement or
suspension is based or (B) 120 days after the date of the
determination of the Board of Directors referred to in the next
sentence. Such postponement or suspension may only be effected
if the Board of Directors of the Company determines in good faith
that the effectiveness of, or sales pursuant to, such
Registration Statement would materially impede, delay or
interfere with any financing, offer or sale of securities,
acquisition, corporate reorganization or other significant
transaction involving the Company or any of its affiliates or
require disclosure of material information which the Company has
a bona fide business purpose for preserving as confidential. If
the Company shall so postpone the effectiveness of, or suspend
the rights of any Holders of Registrable Securities to make sales
pursuant to, a Registration Statement, it shall, as promptly as
possible, notify any Selling Holders of such determination, and
the Selling Holders shall (y) have the right, in the case of a
postponement of the effectiveness of a Registration Statement,
upon the affirmative vote of Selling Holders of not less than a
majority of the Registerable Securities to be included in such
Registration Statement, to withdraw the request for registration
by giving written notice to the Company within 10 days after
receipt of such notice or (z) in the case of a suspension of the
right to make sales, receive an extension of the registration
period referred to in Section 8(a) hereof equal to the number of
days of the suspension.
(d) Exclusion of Registrable Securities. The Company
shall not be required by this Section 8 to include Registrable
Securities in a Piggy-Back Registration if (i) in the written
opinion of counsel to the Company, addressed to the Holders of
Registrable Securities and delivered to them, the Holders of such
Registrable Securities seeking registration would be free to sell
all such Registrable Securities within the current calendar
quarter without registration under Rule 144, which opinion may be
based in part upon the representation by the Holders of such
Registrable Securities seeking registration, which representation
shall not be unreasonably withheld, that each such Holder is not
an affiliate of the Company within the meaning of the Securities
Act, and (ii) all requirements under the Securities Act for
effecting such sales are satisfied at such time.
(e) Obligations of Selling Holders. The Company's
obligations under this Section 8 shall be subject to the
obligations of the Selling Holders, which the Selling Holders
acknowledge, to furnish all information and materials and to take
any and all actions as may be required under applicable federal
and state securities laws and regulations to permit the Company
to comply with all applicable requirements of the SEC and to
obtain any acceleration of the effective date of a Registration
Statement.
(f) No Special Audit. The Company shall not be
obligated to cause any special audit to be undertaken in
connection with any registration pursuant to this Section 8 or
Section 2 unless such audit is requested by the underwriters with
respect to such registration.
9. Miscellaneous
(a) No Inconsistent Agreements. The Issuer has not
entered, as of the date hereof, and the Issuer shall not enter,
after the date of this Agreement, into any agreement with respect
to any of its securities that is inconsistent with the rights
granted to the Holders of Registrable Shelf Securities or
Registrable Securities in this Agreement or otherwise conflicts
with the provisions hereof. The Issuer has not entered and will
not enter into any agreement with respect to any of its
securities which will grant to any Person piggy-back rights with
respect to a Shelf Registration.
(b) Adjustments Affecting Registrable Shelf Securities
or Registrable Securities. The Company shall not, directly or
indirectly, take any action with respect to the Registrable Shelf
Securities or Registrable Securities as a class that would
adversely affect the ability of the Holders to include such
Registrable Shelf Securities or Registrable Securities in a
registration undertaken pursuant to this Agreement.
(c) Amendments and Waivers. The provisions of this
Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may
not be given, otherwise than with the prior written consent of in
circumstances that would adversely affect any Holders of
Registrable Shelf Securities or Registrable Securities, the
Holders of a majority in interest of the Registrable Shelf
Securities or Registrable Securities, as the case may be;
provided, however, that Section 5 and this Section 9(c) may not
be amended, modified or supplemented without the prior written
consent of each Holder (including any Person who was a Holder of
Registrable Shelf Securities or Registrable Securities, as the
case may be, disposed of pursuant to any Registration Statement).
(d) Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by
hand-delivery, registered first-class mail, next-day air courier
or telecopier:
1. if to a Holder of Registrable Shelf Securities
or Registrable Securities, at the most current address of
such Holder set forth on the records of the registrar of the
Warrants or the Amended Series A Preferred Stock, with a
copy in like manner to the Initial Purchaser as follows:
▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
Two Houston Center
▇▇▇ ▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
2. if to the Initial Purchaser, at the address
specified in Section 11(d)(1);
3. if to the Issuer, as follows:
XCL Ltd.
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: General Counsel
All such notices and communications shall be deemed to have
been duly given: when delivered by hand, if personally
delivered; five business days after being deposited in the United
States mail, postage prepaid, if mailed, one business day after
being timely delivered to a next-day air courier guaranteeing
overnight delivery; and when receipt is acknowledged by the
addressee, if telecopied.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to
the Trustee under the Indenture at the address specified in such
Indenture.
(e) Successors and Assigns. This Agreement shall inure
to the benefit of and be binding upon the successors and assigns
of each of the parties hereto and the Holders; provided, however,
that the provisions of this Agreement relating to registration
rights shall not inure to the benefit of or be binding upon a
successor or assign of a Holder unless such successor or assign
holds Registrable Shelf Securities or Registrable Securities.
(f) 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.
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise
affect the meaning hereof.
(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE NON-
EXCLUSIVE JURISDICTION OF THE COMPETENT COURTS OF THE STATE OF
NEW YORK SITTING IN THE CITY OF NEW YORK IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(i) Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions
set forth herein shall remain in full force and effect and shall
in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the
intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid,
illegal, void or unenforceable.
(j) Securities Held by the Issuer or Its Affiliates.
Whenever the consent or approval of Holders of a specified
percentage of Registrable Shelf Securities or Registrable
Securities is required hereunder, Registrable Shelf Securities or
Registrable Securities, as the case may be, held by the Issuer or
its affiliates (as such term is defined in Rule 405 under the
Securities Act) shall not be counted in determining whether such
consent or approval was given by the Holders of such required
percentage.
(k) Third Party Beneficiaries. Holders are intended
third party beneficiaries of this Agreement and this Agreement
may be enforced by such Persons.
(1) Entire Agreement. This Agreement, together with the
Purchase Agreement, is intended by the parties as a final and
exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein
and therein and any and all prior oral or written agreements,
representations, or warranties, contracts, understandings,
correspondence, conversations and memoranda between the Initial
Purchaser on the one hand and the Issuer on the other, or between
or among any agents, representatives, parents, subsidiaries,
affiliates, predecessors in interest or successors in interest
with respect to the subject matter hereof and thereof are merged
herein and replaced hereby.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
XCL LTD.
By:_______________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Executive Vice President,
General Counsel and Secretary
▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
By:________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Senior Vice President