Exhibit III
REGISTRATION RIGHTS AGREEMENT
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This AGREEMENT made as of the 31st day of March, 2000, by and among
Coho Energy, Inc., a Texas corporation (the "Company"), PPM America Special
Investments Fund, L.P., a Delaware limited partnership ("PPM SIF"), PPM America
Special Investments CBO II, L.P., a Delaware limited partnership ("PPM CBO", and
collectively with PPM SIF, "PPM"), Appaloosa Management L.P., a Delaware limited
partnership ("Appaloosa Management") as agent and on behalf of certain funds
including Appaloosa Investment Limited Partnership I, a Delaware limited
partnership ("AILP"), Palomino Fund Ltd., a British Virgin Islands company
("Palomino") and Tersk LLC, a Delaware limited liability company ("Tersk" and,
collectively with Palomino, AILP and Appaloosa Management, "Appaloosa"),
Pacholder Associates, Inc., an Ohio corporation ("Pacholder Associates") as
agent and on behalf of certain funds including Pacholder Value Opportunity Fund,
L.P. ("Pacholder Value"), High Yield Fund, Inc. ("Pacholder Fund"), One Group
High Yield Bond ("One Group") and Evangelical Lutheran Church In America Board
of Pensions ("ELC," and together with One Group, Pacholder Fund, Pacholder Value
and Pacholder Associates, "Pacholder") and Oaktree Capital Management, LLC, a
California limited liability company ("Oaktree Capital") as general partner of
and investment manager for the entities set forth on Schedule I (Oaktree Capital
and such entities, collectively, "Oaktree"). PPM, Appaloosa, Oaktree, and
Pacholder are collectively referred to herein as the "Investors". PPM, Appaloosa
and Oaktree are collectively referred to herein as the "Old Noteholder
Investors".
WHEREAS, pursuant to the Company's First Amended Joint Plan of
Reorganization dated March 20, 2000 under Chapter 11 of the United States
Bankruptcy Code (Case No. 399-35929-HCA-11 in the United States Bankruptcy Court
for the Northern District of Texas, Dallas Division) (the "Plan"), each of the
Old Noteholder Investors has agreed to convert on the effective date of the Plan
all of the Company's 8-7/8% Senior Subordinated Notes due 2007 (the "Old Notes")
owned by such Old Noteholder Investor into shares of the reorganized Company's
common stock, par value $.0l per share ("Common Stock"); and
WHEREAS. it is a condition precedent to the obligation of each of
the Old Noteholder Investors to convert the Old Notes owned by such Old
Noteholder Investors into shares of Common Stock pursuant to the terms of the
Plan that the Company and the Old Noteholder Investors enter into a Registration
Rights Agreement with respect to the shares of Common Stock to be acquired by
the Old Noteholder Investors either as a result of the conversion of their Old
Notes in accordance with the terms of the Plan or otherwise; and
WHEREAS, pursuant to a Note Agreement dated as of the date hereof
(the "Note Agreement") by and among the Company, certain affiliates of the
Company and the Investors, the Investors have agreed, among other things, to
purchase from the Company $72,000,000 aggregate principal amount of the
Company's 15% Senior Subordinated Notes due March 31, 2007 (the "New Notes");
and
WHEREAS, in connection with the Investors' purchase of the New
Notes, the Company has agreed pursuant to the terms of a Securities Purchase
Agreement dated as of the
date hereof by and among the Company, certain affiliates of the Company and the
Investors (the "Securities Purchase Agreement") to issue to each of the
Investors shares of Common Stock; and
WHEREAS, it is a condition precedent to the obligation of the
Investors to purchase the New Notes pursuant to the Note Agreement that the
Company and the Investors enter into a Registration Rights Agreement with
respect to the shares of Common Stock to be acquired by the Investors, pursuant
to the terms of the Securities Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto hereby agree as follows:
1. Definitions. The following terms shall be used in this Agreement
with the following respective meanings:
"Affiliate" means (i) any Person directly or indirectly controlling,
controlled by or under common control with another Person; (ii) any Person
owning or controlling ten (10%) percent or more of the outstanding voting
securities of such other Person; (iii) any officer, director or partner of such
Person; and (iv) if such Person is an officer, director or partner, any such
company for which such Person acts in such capacity.
"Commission" means the Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act.
"Common Stock" means and includes (a) the Company's Common Stock,
$.01 par value per share and (b) any other securities into which or for which
the securities described in (a) above may be converted or exchanged pursuant to
a plan of recapitalization, reorganization, merger, sale of assets or otherwise.
"Exchange Act" means the Securities Exchange Act of 1934, or any
successor Federal statute, and the rules and regulations of the Commission (or
of any other Federal agency then administering the Exchange Act) thereunder,
all as the same shall be in effect at the time.
"Holder" means any holder of Registrable Stock.
"NASD" means the National Association of Securities Dealers, Inc.
"Person" means any natural person. partnership, corporation or other
legal entity.
"Registrable Stock" means (a) the Common Stock issued or issuable to
any Investor in accordance with the terms of the Securities Purchase Agreement,
(b) all Common Stock issued or issuable to any Old Noteholder Investor in
accordance with the Plan, (c) all Common Stock now or hereafter owned by any
Investor which is acquired otherwise than pursuant to the terms of the
Securities Purchase Agreement or pursuant to the terms of the Plan so long as it
is held by any Investor or an Affiliate of any Investor and (d) any other shares
of Common Stock or other securities issued in respect of such shares by way of a
stock dividend, or stock split or in connection with a combination of shares,
recapitalization, merger or consolidation or reorganization; provided, however,
that such shares of Common Stock shall
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cease to be Registrable Stock when (i) a 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 in accordance with the plan of
distribution set forth in such registration statement, (ii) such securities
shall have been distributed in accordance with Rule 144 (or any successor
provision) under the Securities Act, or (iii) such securities shall have been
otherwise transferred, new certificates therefor not bearing a legend
restricting further transfer shall have been delivered in exchange therefor by
the Company and the subsequent disposition of such shares shall not require
registration or qualification under the Securities Act or any similar state law
then in force.
"Registration Statement" means a registration statement filed by the
Company with the Commission for a public offering and sale of securities of the
Company (other than a registration statement on Form X-0, Xxxx X-0, or successor
forms, or any registration statement covering only securities proposed to be
issued in exchange for securities or assets of another corporation).
"Securities Act" means the Securities Act of 1933, or any successor
Federal statute, and the rules and regulations of the Commission (or of any
other Federal agency then administering the Securities Act) thereunder, all as
the same shall be in effect at the time.
2. Shelf Registration.
(a) The Company shall use its best efforts to cause to be
filed pursuant to Rule 415 (or any successor provision) of the
Securities Act not later than January 31, 2001 a Shelf Registration
Statement relating to the offer and sale of the Registrable Stock by
the Holders from time to time (the "Shelf Registration Statement")
in accordance with the methods of distribution elected by such
Holders and set forth in such Shelf Registration Statement. The
Company shall use its best efforts to cause the Shelf Registration
Statement to be declared effective on or before March 31, 2001 and
to cause the Shelf Registration Statement to remain effective until
the earliest of (i) such time as all shares of Registrable Stock
have been sold thereunder, (ii) three years after its effective date
and (iii) such time as all of the Registrable Stock can be sold by
the Holders thereof without restriction under the Securities Act. In
connection with the Shelf Registration Statement, (i) the Company
shall furnish to the Holders, prior to the filing with the
Commission, a copy of the Shelf Registration Statement and shall use
its best efforts to reflect in such document when filed with the
Commission, such comments as the Holders may reasonably propose,
(ii) the Company shall make available all material customary for
reasonable due diligence examinations in connection with the Shelf
Registration Statement, (iii) the Company shall enter into such
agreements as are appropriate, customary and reasonably necessary in
connection with the Shelf Registration Statement, and (iv) the
Company shall make such representations and warranties to the
Holders of Registrable Stock (and any underwriters participating in
any offering and sale to be made pursuant to the Shelf Registration
Statement) as are customary in connection with the Shelf
Registration Statement.
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(b) During any consecutive 365-day period, the Company shall
be entitled to suspend the availability of the Shelf Registration
Statement for up to two 30 consecutive-day periods if the Company's
Board of Directors determines in its reasonable good faith judgment
that there is a valid business purpose for such suspension and
provides notice to the Holders that such determination was made by
the Company's Board; provided, however, that notwithstanding the
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foregoing, if the Company shall furnish to the Holders a certificate
signed by the President of the Company stating that in the good
faith reasonable judgment of the Board of Directors of the Company
after consultation with outside counsel, the Company would be
required in order to comply with the Securities Act and the rules
and regulations promulgated thereunder to disclose in the Shelf
Registration Statement or in an amendment or supplement thereto
material non-public information relating to the Company which the
Company has a bona fide business purpose for preserving as
confidential or to make any disclosure in the Shelf Registration
Statement or in an amendment or supplement thereto that would
interfere with an existing or anticipated acquisition or financing
with respect to the Company, then the Company shall have the right
to suspend the availability of the Shelf Registration Statement
until the earliest of (i) the date upon which such material
information is disclosed to the public or ceases to be material,
(ii) the date upon which such acquisition or financing is
consummated or, if earlier, the date upon which any such
interference with such existing or anticipated acquisition or
financing would no longer exist, or (iii) forty-five (45) days after
the date of such written notice to the Holders; provided, however,
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that the Company may not utilize this suspension right more than
once in any twelve-month period.
3. Demand Registration.
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(a) At any time after March 31, 2001, the Holder or Holders of
at least ten (10%) percent of all Registrable Stock then outstanding
(the "Initiating Holders") may, subject to the provisions of Section
3(b) hereof, by notice in writing to the Company request the Company
to register under the Securities Act all or any portion of shares of
Registrable Stock held by such Initiating Holder or Holders for sale
in the manner specified in such notice. Notwithstanding anything to
the contrary contained herein, the Company shall not be required to
seek to cause a Registration Statement to become effective pursuant
to this Section 3: (A) within a period of 90 days after the
effective date of a Registration Statement filed by the Company,
provided that the Company shall use commercially reasonably efforts
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to cause a registration requested hereunder to be declared effective
promptly following such period if such request is made during such
period; or (B) if the Company shall furnish to the Initiating Holder
or Holders a certificate signed by the President of the Company
stating that in the good faith reasonable judgment of the Board of
Directors of the Company after consultation with outside counsel,
the filing of a Registration Statement would, at such time require
the disclosure of material non-public information relating to the
Company which, the Company has a bona fide business purpose for
preserving as confidential or interfere with an existing or
anticipated acquisition or financing with respect to the Company,
then
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the Company's obligations under this Section 3 shall be deferred
until the earliest of (i) the date upon which such material
information is disclosed to the public or ceases to be material,
(ii) the date upon which such acquisition or financing is
consummated or, if earlier, the date upon which any such
interference with such existing or anticipated acquisition or
financing would no longer exist, or (iii) forty-five (45) days after
the date of receipt of written request from such Initiating Holder
or Holders; provided, however, that the Company may not utilize this
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deferral right more than once in any twelve-month period.
(b) Following receipt of any notice given under this Section 3
by the Initiating Holders, the Company shall immediately notify in
writing all Holders that such registration is to be effected and
shall use commercially reasonable efforts to register under the
Securities Act for public sale in accordance with the method of
disposition specified in such notice from requesting Holders, the
number of shares of Registrable Stock specified in such notice (and
in all notices received by the Company pursuant hereto). Holders,
other than the Initiating Holders, shall notify the Company of their
desire to participate in the registration within twenty (20) days
of the Company's notice to them. The Company shall use commercially
reasonable efforts to cause a Registration Statement with respect to
the Registrable Stock which Holders have requested be registered
pursuant to this Section 3 no later than forty-five (45) days after
receiving the notice pursuant to Section 3(a) of the Initiating
Holders. The Company shall designate the managing underwriter of
such offering, subject to the approval of the Holders of a majority
of the shares of Registrable Stock to be sold in such offering,
which approval shall not be unreasonably withheld or delayed. Each
Investor shall have the right to request the registration of
Registrable Stock pursuant to this Section 3 on three occasions
only, provided, however, that the Company's obligation to register
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the Registrable Stock pursuant to this Section 3 in response to a
particular request shall be deemed satisfied only when a
Registration Statement or Registration Statements covering all
shares of Registrable Stock, specified in notices received as
aforesaid and which have not been withdrawn by the Holders thereof,
for sale in accordance with the method of disposition specified by
the Initiating Holders, shall have become effective. A registration
which does not become effective after the Company has filed a
Registration Statement with respect thereto solely by reason of the
refusal of the Initiating Holders to proceed shall be deemed to have
been effected by the Company at the request of such Initiating
Holders unless the registration was withdrawn at the request of the
Holders of a majority of the Registrable Stock to be sold in such
offering upon learning of a material adverse change in the
condition, business or prospects of the Company from that known to
such Holders at the time of their request that makes the proposed
offering unreasonable in the good faith judgment of a majority in
interest of such Holders.
(c) If the Registration Statement is to cover an underwritten
distribution and in the good faith judgment of the managing
underwriter of such public offering the inclusion of all of the
Registrable Stock requested for inclusion pursuant to this Section 3
would interfere with the successful marketing of a
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smaller number of shares to be offered, then the number of shares of
Registrable Stock to be included in the offering shall be reduced to
the required level with the participation in such offering to be
reduced pro rata among the Holders requesting such registration,
based upon the number of shares of Registrable Stock requested to be
included in such registration owned by such Holders. Except for
registration statements on Form X-0, X-0 or any successors thereto,
the Company will not file with the Commission any other registration
statement with respect to its Common Stock, whether for its own
account or that of other stockholders, from the date of receipt of a
notice from the Initiating Holders pursuant to this Section 3 until
the completion of the period of distribution of the registration
contemplated thereby.
4. Piggyback Registration. Each time the Company shall determine to
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file a Registration Statement in connection with the proposed offer and sale for
money of any of its securities by it or any of its security holders, the Company
will give written notice thereof to all Holders. Upon the written request of one
or more Holder(s) given within twenty (20) days after the giving of any such
notice by the Company, the Company will use commercially reasonable efforts to
cause all shares of Registrable Stock, the Holders of which have so requested
registration thereof, to be included in such Registration Statement, all to the
extent requisite to permit the sale or other disposition by the prospective
seller or sellers of the Registrable Stock to be so registered, provided that
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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 or to delay registration of such securities, the Company may, at
its election, give written notice of such determination to each such holder of
Registrable Stock and, thereupon, (i) in the case of a determination not to
register, shall be relieved of its obligation to register any Registrable Stock
in connection with such registration (but not from its obligation to pay any and
all expenses in connection therewith as specified in Section 7 hereof), and (ii)
in the case of a determination to delay registering, shall be permitted to delay
registering any Registrable Stock, for the same period as the delay in
registering such other securities. If the Registration Statement is to cover an
underwritten distribution, the Company shall cause the Registrable Stock
requested for inclusion pursuant to this Section 4 to be included in the
underwriting on the same terms and conditions as the securities otherwise being
sold through the underwriters. If, in the good faith judgment of the managing
underwriter of such public offering, the inclusion of all of the Registrable
Stock requested for inclusion pursuant to this Section 4 would interfere with
the successful marketing of a smaller number of shares to be offered, then the
number of shares of Registrable Stock and other securities to be included in the
offering shall be reduced to the required level by first excluding securities of
any securityholder (other than the Company and the Holders) who proposes to
offer or sell securities in the registered offering, and then excluding on a pro
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rata basis among the Company, and each Holder of Registrable Stock requesting
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such registration based on the number of shares of Registrable Stock or other
securities the Company and each such Holder proposes to offer or sell in the
registered offering.
5. Registration on Form S-3.
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If at any time after the date hereof, (i) a Holder or Holders
request that the Company file a registration statement on Form S-3 or any
successor thereto for a public offering of all or any portion of the shares of
Registrable Stock held by such requesting Holder or
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Holders, and (ii) the Company is a registrant entitled to use Form S-3 or any
successor thereto to register such shares, then the Company shall use
commercially reasonably efforts to register under the Securities Act on Form S-3
or any successor thereto, for public sale in accordance with the method of
disposition specified in such notice, the number of shares of Registrable Stock
specified in such notice. Whenever the Company is required by this Section 5 to
use commercially reasonable efforts to effect the registration of Registrable
Stock, each of the procedures, requirements and limitations of Section 3 not
otherwise addressed in this Section 5 (including but not limited to the
requirement that the Company notify all Holders from whom notice has not been
received and provide them with the opportunity to participate in the offering
and the requirements of subparagraph (b) of Section 3 but not including the
limitations on the number of registrations the Company is obligated to make
under subparagraph (b) of Section 3) shall apply to such registration. There
shall be no limit on the number of registrations of Registrable Stock which the
Company shall be obligated to effect pursuant to this Section 5.
6. Registration Procedures. If and whenever the Company is required
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by the provisions of Section 2, 3, 4 or 5 hereof to effect the registration of
shares of Registrable Stock under the Securities Act, the Company will, at its
expense, as expeditiously as possible:
(a) In accordance with the Securities Act and the rules and
regulations of the Commission, prepare and file with the Commission
a Registration Statement with respect to the Registrable Stock and
use its best efforts to cause such Registration Statement to become
effective as promptly as possible and to remain effective until the
Registrable Stock covered by such Registration Statement has been
sold, but (other than in the case of the Shelf Registration
Statement) for no longer than twelve (12) months subsequent to the
effective date of such Registration Statement, and prepare and file
with the Commission such amendments to such Registration Statement
and supplements to the prospectus contained therein as may be
necessary to keep such Registration Statement effective and such
Registration Statement and prospectus accurate and complete until
the Registrable Stock covered by such Registration Statement has
been sold, but (other than in the case of the Shelf Registration
Statement) for no longer than twelve (12) months subsequent to the
effective date of such Registration Statement;
(b) If the offering is to be underwritten in whole or in part,
enter into a written underwriting agreement in form and substance
reasonably satisfactory to the managing underwriter, if any, of the
public offering and the Holders participating in such offering;
(c) Furnish to the participating Holders and to the
underwriters such reasonable number of copies of the Registration
Statement, preliminary prospectus, final prospectus and such other
documents as such underwriters and participating Holders may
reasonably request in order to facilitate the public offering of
such securities;
(d) Use commercially reasonable efforts to register or qualify
the Registrable Stock covered by such Registration Statement under
such state
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securities or blue sky laws of such jurisdictions (i) as shall be
reasonably appropriate for the distribution of the Registrable Stock
covered by such Registration Statement or (ii) as such participating
Holders and underwriters may reasonably request within ten (10) days
following the original filing of such Registration Statement, except
that the Company shall not for any purpose be required to execute a
general consent to service of process, to subject itself to
taxation, or to qualify to do business as a foreign corporation in
any jurisdiction where it is not so qualified;
(e) Notify the Holders participating in such registration,
promptly after it shall receive notice thereof, of the date and time
when such Registration Statement and each post-effective amendment
thereto has become effective or a supplement to any prospectus
forming a part of such Registration Statement has been filed with
the Commission;
(f) Notify the Holders participating in such registration
promptly of any request by the Commission or any state securities
commission or agency for the amending or supplementing of such
Registration Statement or prospectus or for additional information;
(g) Prepare and file with the Commission, promptly upon the
request of any such participating Holders, any amendments or
supplements to such Registration Statement or prospectus which, in
the opinion of counsel representing the Company in such Registration
(and which counsel is reasonably acceptable to such participating
Holders), is required under the Securities Act or the rules and
regulations thereunder in connection with the distribution of the
Registrable Stock by such participating Holders, but (other than in
the case of the Shelf Registration Statement) for no longer than
twelve (12) months subsequent to the effective date of such
registration:
(h) Prepare and promptly file with the Commission, and
promptly notify such participating Holders of the filing of, such
amendments or supplements to such Registration Statement or
prospectus as may be necessary to correct any statements or
omissions if, at the time when a prospectus relating to such
Registrable Stock is required to be delivered under the Securities
Act, any event has occurred as the result of which any such
prospectus or any other prospectus as then in effect would include
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;
(i) In case any of such participating Holders or any
underwriter for any such Holders is required to deliver a prospectus
at a time when the prospectus then in circulation is not in
compliance with the Securities Act or the rules and regulations of
the Commission, prepare promptly upon request of any such
participating Holders such amendments or supplements to such
Registration Statement and such prospectus as may be necessary in
order for such prospectus
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to comply with the requirements of the Securities Act and such rules
and regulations;
(j) Advise such participating Holders promptly after it shall
receive notice or obtain knowledge of the issuance of any stop order
by the Commission or any state securities commission or agency
suspending the effectiveness of such Registration Statement or the
initiation or threatening of any proceeding for that purpose and
promptly use its best efforts to prevent the issuance of any stop
order or to obtain its withdrawal if such stop order should be
issued;
(k) At the request of any such participating Holder (i)
furnish to such Holder, if such registration includes an
underwritten public offering, at the closing provided for in the
underwriting agreement, copies of any opinion, dated such date, of
the counsel representing the Company for the purposes of such
registration, addressed to the underwriters, if any, covering such
matters with respect to the Registration Statement, the prospectus
and each amendment or supplement thereto, proceedings under state
and Federal securities laws, other matters relating to the Company,
the securities being registered and the offer and sale of such
securities as are customarily the subject of opinions of issuer's
counsel provided to underwriters in underwritten public offerings
or, if the offering is not underwritten, obtain such opinions of
counsel to the Company addressed to and reasonably satisfactory to
the Holders covering such matters as are customary in connection
with such offering and (ii) use commercially reasonable efforts to
furnish to such Holder letters dated each such effective date and
such closing date, from the independent certified public accountants
of the Company, addressed to the underwriters, if any, and to the
Holder or Holders making such request, stating that they are
independent certified public accountants within the meaning of the
Securities Act and dealing with such matters as the underwriters may
request, or, if the offering is not underwritten, that in the
opinion of such accountants the financial statements and other
financial data of the Company included in the Registration Statement
or the prospectus or any amendment or supplement thereto comply in
all material respects with the applicable accounting requirements of
the Securities Act, and additionally covering such other financial
matters, including information as to the period ending not more than
five (5) business day's prior to the date of such letter with
respect to the Registration Statement and prospectus, as such
requesting Holder or Holders may reasonably request;
(1) Apply for listing and use commercially reasonable efforts
to list the Registrable Stock being registered on any national
securities exchange on which a class of the Company's equity
securities is listed or, if the Company does not have a class of
equity securities listed on a national securities exchange, apply
for qualification and use its best efforts to qualify the
Registrable Stock being registered for inclusion on the automated
quotation system of the National Association of Securities Dealers,
Inc.
7. Expenses.
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(a) With respect to each registration effected pursuant to
Section 2, 3, 4 or 5 hereof, all fees, costs and expenses of and
incidental to such registration and the public offering in
connection therewith shall be borne by the Company; provided,
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however, that Holders and other holders of the Company's stock
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participating in any such registration shall bear their pro rata
share of any underwriting discounts and selling commissions, and;
provided, further, however, that notwithstanding the foregoing, the
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Company shall not be liable for expenses incurred in connection with
any registration that shall not have become effective due to a
revocation by the Holders of Registrable Stock except if such
registration was revoked or withdrawn by the Holders upon learning
of a material adverse change in the condition, business or
prospectus of the Company from that known to such Holders at the
time of their request for or to be included in such registration
that makes the proposed offering unreasonable in the good faith
judgment of such Holders.
(b) The fees, costs and expenses of registration to be borne
as provided in paragraph (a) above shall include, without
limitation, all registration, filing and NASD fees, printing
expenses, fees and disbursements of counsel and accountants for the
Company, fees and disbursements of counsel for the underwriter or
underwriters of such securities (if the Company and/or selling
security holders are otherwise required to bear such fees and
disbursements), all legal fees and disbursements and other expenses
of complying with state securities or blue sky laws of any
jurisdictions in which the securities to be offered are to be
registered or qualified, reasonable fees and disbursements of one
counsel for the selling Holders and the other holders of the
Company's stock participating in such registration and the premiums
and other costs of policies of insurance insuring the Company
against liability arising out of such public offering.
8. Indemnification and Contribution.
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(a) To the fullest extent permitted by law, the Company will
indemnify and hold harmless each Holder whose shares of Registrable
Stock are included in a Registration Statement pursuant to the
provisions of this Agreement, each director, officer, partner,
employee and agent of such Holder, and any underwriter (as defined
in the Securities Act) for such Holder, and any Person who controls
such Holder or such underwriter within the meaning of the Securities
Act, and each of their successors, from and against, and will
reimburse such Holder, each director, officer, partner, employee and
agent of such Holder and each such underwriter, controlling Person
and successor with respect to, any and all claims, actions, demands,
losses, damages, liabilities, costs and expenses to which such
Holder, such director, officer, partner, employee or agent of such
Holder or any such underwriter, controlling Person or successor may
become subject under the Securities Act or otherwise, insofar as
such claims, actions, demands, losses, damages, liabilities, costs
or expenses arise out of or are based upon any untrue statement or
allegedly untrue statement of any material fact contained in such
Registration Statement, any prospectus contained therein or any
amendment or supplement thereto, or arise out of or are based upon
the omission or alleged
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omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading
or arise out of any violation by the Company of any rule or
regulation under the Securities Act applicable to the Company and
relating to action or inaction required of the Company in connection
with such registration; provided, however, that the Company will not
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be liable in any such case to the extent that any such claim,
action, demand, loss, damage, liability, cost or expense arises out
of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission so made in reliance upon and in
conformity with information furnished by or on behalf of any such
Holder, such director, officer, partner, employee or agent of such
Holder, such underwriter, controlling Person or successor in writing
specifically for use in the preparation thereof, and provided,
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further, that this indemnity shall not be deemed to relieve any
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underwriter of any of its due diligence obligations; and provided
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further, that if any claim, action, demand, loss, damage, liability,
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cost or expense arises out of or is based upon an untrue statement
or alleged untrue statement or omission or alleged omission
contained in any preliminary prospectus which did not appear in the
final prospectus and if the Holder delivered a copy of the
preliminary prospectus to the person alleging damage and failed to
deliver a copy of the final prospectus to such persons, the Company
shall not be liable with respect to the claims of such person.
(b) Each Holder of shares of Registrable Stock which are
included in a registration pursuant to the provisions of this
Agreement will, severally and not jointly, indemnify and hold
harmless the Company, each of its directors and officers, each
underwriter, if any, of the Company's securities covered by such
registration, each person who controls the Company or such
underwriter within the meaning of the Securities Act, and each other
Holder of shares of Registrable Stock which are included in the
registration, each of the officers, directors, partners, employees
and agents of each such other Holder and each person controlling
such other Holder, from and against, and will reimburse such parties
with respect to, any and all losses, damages, liabilities, costs or
expenses to which such parties may become subject under the
Securities Act or otherwise, to the extent that any such loss,
damage, liability, cost or expense arises out of or is based upon
any untrue or alleged untrue statement of any material fact
contained therein or any amendment or supplement thereto, or arises
out of or is 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, in each case to the
extent, but only to the extent that such untrue statement or alleged
untrue statement or omission or alleged omission was so made in
reliance upon and in conformity with written information furnished
by or on behalf of such Holder for use in the preparation thereof,
provided that the liability of each Holder hereunder shall be
limited to the proportion of any such loss, claim, damage, liability
or expense which is equal to the proportion that the public offering
price of the shares sold by such Holder under such Registration
Statement bears to the total public offering price of all securities
sold thereunder, but not in any event to exceed the net proceeds
received by such Holder from the sale of shares of Registrable Stock
covered by a Registration Statement; and provided, further, that
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this indemnity shall not be deemed to relieve any underwriter of any
of its due diligence obligations.
(c) Promptly after receipt by a party to be indemnified
pursuant to the provisions of paragraph (a) or (b) of this Section 8
(an "indemnified party") of actual knowledge or notice of the
commencement of any action involving the subject matter of the
foregoing indemnity provisions, such indemnified party will, if a
claim thereof is to be made against the indemnifying party pursuant
to the provisions of paragraph (a) or (b), notify the indemnifying
party of the commencement thereof, but the omission so to notify the
indemnifying party will not relieve it from any liability which it
may have to an indemnified party otherwise than under this Section 8
and shall not relieve the indemnifying party from liability under
this Section 8 unless such indemnifying party is prejudiced by such
omission. In case such action is brought against any indemnified
party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party shall have the right to participate
in, and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense
thereof, 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
pursuant to the provisions of such paragraphs (a) and (b) for any
legal or other expense subsequently incurred by such indemnified
party in connection with the defense thereof other than reasonable
costs of investigation. Notwithstanding the foregoing, an
indemnified party shall have the right to retain its own counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by
the indemnifying party would be inappropriate due to actual or
potential differing interests, as reasonably determined by either
party, between such indemnified party and any other party
represented by such counsel in such proceeding. No indemnifying
party shall be liable to an indemnified party for any settlement of
any action or claim without the consent of the indemnifying party;
no indemnifying party may unreasonably withhold its consent to any
such settlement. No indemnifying party will consent to entry of any
judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff
to such indemnified party of a release from all liability in respect
to such claim or litigation.
(d) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which either
(i) any Holder exercising rights under this Agreement, or any
controlling Person of any such Holder, makes a claim for
indemnification pursuant to this Section 8 but it is judicially
determined (by the entry of a final judgment or decree by a court of
competent jurisdiction and the expiration of time to appeal or the
denial of the last right of appeal) that such indemnification may
not be enforced in such case notwithstanding the fact that this
Section 8 provides for the indemnification in such case or (ii)
contribution under the Securities Act may be required on the part of
any such selling Holder or any such controlling Person in
circumstances for
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which indemnification was provided under this Section 8; then, and
in each case, the Company and each such Holder, will contribute to
the aggregate losses, claims, damages or liabilities to which they
may be subject (after contribution from others) in such proportion
so that such Holder is responsible for the portion represented by
the percentage that the public offering price of its Registrable
Stock offered by the Registration Statement bears to the public
price of all securities offered by such Registration Statement, and
the Company is responsible for the remaining portion; provided,
--------
however, that, in any such case, (A) no Person or entity guilty of
-------
fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) will be entitled to contribution from any Person
or entity was not guilty of such fraudulent misrepresentation and
(B) no Holder will be required to contribute any amount in excess of
the net proceeds of such holder of such Registrable Stock offered by
it pursuant to such Registration Statement.
9. Reporting Requirements Under Securities Exchange Act of 1934. The
------------------------------------------------------------
Company shall keep effective the registration of its Common Stock under Section
12 of the Exchange Act and shall timely file such information, documents and
reports as the Commission may require or prescribe under Section 13 or 15(d) of
the Exchange Act. The Company shall forthwith upon request furnish any Holder
(i) a written statement by the Company that it has complied with such reporting
requirements, (ii) a copy of the most recent annual or quarterly report of the
Company, and (iii) such other reports and documents filed by the Company with
the Commission as such Holder may reasonably request in availing itself of an
exemption for the sale of Registrable Stock without registration under the
Securities Act. The Company acknowledges and agrees that the purposes of the
requirements contained in this Section 9 are (a) to enable any such Holder to
comply with the current public information requirement contained in Paragraph
(c) of Rule 144 under the Securities Act should such Holder ever wish to dispose
of any of the securities of the Company acquired by it without registration
under the Securities Act in reliance upon Rule 144 (or any other similar or
successor exemptive provision), and (b) to qualify the Company for the use of
Registration Statements on Form S-3. In addition, the Company shall take such
other measures and file such other information, documents and reports, as shall
hereafter be required by the Commission as a condition to the availability of
Rule 144 under the Securities Act (or any similar or successor exemptive
provision hereafter in effect) and the use of Form S-3. The Company also
covenants to use its best efforts, to the extent that it is reasonably within
its power to do so, to qualify for the use of Form S-3. The Company agrees to
use its best efforts to facilitate and expedite transfers of Registrable Stock
pursuant to Rule 144 under the Securities Act (or any similar or successor
exemptive provision hereafter in effect), which efforts shall include timely
notice to its transfer agent to expedite such transfers of Registrable Stock.
10. Stockholder Information. The Company may require each Holder of
-----------------------
Registrable Stock as to which any registration is to be effected pursuant to
this Agreement to furnish the Company in a timely manner such information with
respect to such Holder and the distribution of such Registrable Stock as the
Company may from time to time reasonably request in writing and as shall be
required by law or by the Commission in connection therewith.
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11. Company Lock-Up. The Company agrees, if so required by the
---------------
managing underwriter with respect to any underwritten registration hereunder,
not to sell, make any short sale of, loan, grant any option for the purchase of
(other) than pursuant to employee benefit plans), effect any public sale or
distribution of or otherwise dispose of its equity securities or securities
convertible into or exchangeable or exercisable for any such securities during
the 30 days prior to and the 90 days after any underwritten registration
pursuant to Section 2, 3, 4 or 5 hereof has become effective, except as part of
such underwritten registration and except pursuant to registrations on Form S-4
or S-8.
12. Notices. Any notice required or permitted to be given hereunder
-------
shall be in writing and shall be deemed to be properly given when sent by
registered or certified mail, return receipt requested, by Federal Express, DHL
or other guaranteed overnight delivery service or by facsimile transmission,
addressed as follows:
If to the Company: Coho Energy, Inc.
c/o Coho Resources, Inc.
00000 Xxxxxxx Xxxx, Xxxxx 000
Xxxxxx Xxxxx 00000
Attn.: President
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
With copies to: Fulbright & Xxxxxxxx, L.L.P.
0000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn.: Xxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
If to any Investor: To the address of such Investor set forth on
The signature pages hereto
With a copy to: Xxxxxxxx Kill & Olick, P.C.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attn: J. Xxxxxx Xxxx, Xx.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
and if to any other Holder at such Holder's address for notice as set forth in
the register maintained by the Company, or, as to any of the foregoing, to such
other address as any such party may give the others notice of pursuant to this
Section, provided that a change of address shall only be effective upon receipt.
All notices, requests, consents and other communications hereunder shall be
deemed to have been received (i) if by hand, at the time of delivery thereof to
the receiving party at the address of
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such party set forth above or as so designated, (ii) if made by telecopy or
facsimile transmission, at the time that receipt thereof has been acknowledged
by electronic confirmation or otherwise, (iii) if sent by overnight courier, on
the next business day following the day such notice is delivered to the courier
service, or (iv) if sent by registered or certified mail, on the fifth business
day following the day such mailing is made.
13. Governing Law. This Agreement shall be governed by, and
-------------
construed in accordance with, the substantive laws of the State of Illinois
(without regard to conflict of laws provisions).
14. Waivers; Amendments. No waiver of any right hereunder by any
-------------------
party shall operate as a waiver of any other right, or of the same right with
respect to any subsequent occasion for its exercise, or of any right to damages.
No waiver by any party of any breach of this Agreement shall be held to
constitute a waiver of any other breach or a continuation of the same breach.
All remedies provided by this Agreement are in addition to all other remedies
provided by law. The provisions of this Agreement may not be amended except by a
writing executed by the Company and the Holders of at least a majority of the
then outstanding Registrable Stock and the securities convertible into,
exchangeable for or exercisable for Registrable Stock (calculated on an as
converted, exchanged or exercised basis).
15. Other Registration Rights. So long as any of the registration
-------------------------
rights under this Agreement remain in effect, the Company shall not grant to any
third party any registration rights for any securities of the Company, except
that the Company may grant piggyback registration rights to a third party
related to any registration statement covered by Section 4 hereof provided that
the rights of such third party shall be subject to the rights of the Holders
pursuant to the last sentence of Section 4 hereof.
16. Successors and Assigns. This Agreement shall be binding upon and
----------------------
shall inure to the benefit of the respective legal representatives, successors
and assigns of the parties hereto; provided, however, that any person or entity
to which Registrable Shares are proposed to be transferred shall provide prompt
written notice of such proposed transfer to the Company.
17. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
18. Prior Understandings and Agreements. This Agreement represents
-----------------------------------
the complete agreement of the parties with respect to the transactions
contemplated hereby and supersedes all prior agreements and understandings.
19. Headings. Headings in this Agreement are included for reference
--------
only and shall have no effect upon the construction or interpretation of any
part of this Agreement.
20. Severability. If any provision of this Agreement shall be held
------------
to be illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.
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