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EXHIBIT 4.5
$65,000,000
National Energy Group, Inc.
10 3/4% Series C Senior Notes due 2006
REGISTRATION RIGHTS AGREEMENT
August 21, 1997
▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
PRUDENTIAL SECURITIES INCORPORATED
c/▇ ▇▇▇▇▇▇▇▇▇ & Company, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Finance Department
Ladies and Gentlemen:
National Energy Group, Inc., a Delaware corporation (the "Company")
proposes to issue and sell to you (the "Initial Purchasers"), upon the terms
set forth in a purchase agreement dated August 15, 1997 (the "Purchase
Agreement"), $65,000,000 principal amount of the Company's 10 3/4% Series C
Senior Notes due 2006 (the "Notes"). The Notes will be issued pursuant to an
indenture, to be dated as of August 21, 1996 (the "Indenture") by and between
the Company and Bank One, N.A., as trustee (the "Trustee"), substantially in
the form previously furnished to you.
Capitalized terms used but not specifically defined herein are defined
in the Purchase Agreement and used herein as so defined. As used herein,
"Registrable Notes" shall mean each Note, until the earliest to occur of (a)
the date on which a Registered Exchange Offer is completed for the Notes
pursuant to which such Note may be exchanged in the Registered Exchange Offer
for an Exchange Note (each as defined below) and entitled to be resold to the
public by the holder thereof without complying with the prospectus delivery
requirements of the Securities Act of 1933, as amended (the "Securities Act"),
(b) the date on which such Note has been effectively registered under the
Securities Act and disposed of pursuant to a Notes Shelf Registration (as
defined below), (c) the date on which such Note is distributed to the public
pursuant to Rule 144 under the Securities Act or by a Broker-Dealer (as defined
below) pursuant to the "Plan of Distribution" contemplated by the registration
statement relating to the Registered Exchange Offer (including delivery of the
prospectus contained therein) or (d) the date such Note ceases to be
outstanding.
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In consideration of the premises, and the mutual covenants,
representations, warranties and agreements herein contained, the parties hereby
agree as follows:
1. Registered Exchange Offer.
(a) Promptly (and in any event not more than 60 days)
following the closing date of the sale of the Notes (the "Closing Date"), the
Company shall file with the Commission a registration statement on an
appropriate form under the Securities Act with respect to a proposed offer (the
"Registered Exchange Offer") to the holders of the Registrable Notes to issue
and deliver to such holders, in exchange for the Registrable Notes, a like
principal amount of debt securities of the Company identical in all material
respects to the Registrable Notes (the "Exchange Notes"), shall use its best
efforts to cause such registration statement to become effective under the
Securities Act no later than 120 days after the Closing Date and, upon the
effectiveness of that registration statement, shall commence the Registered
Exchange Offer and shall cause the same to remain open for such period of time
to be determined by the Company (but not less than 30 nor more than 60 days
after the commencement of the Registered Exchange Offer), and to be conducted
in accordance with such procedures, as may be required by the applicable
provisions of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), it being the objective of such Registered Exchange Offer to enable each
holder of Registrable Notes electing to exchange Registrable Notes for Exchange
Notes (assuming that such holder is not an affiliate of the Company within the
meaning of the Securities Act, acquires the Exchange Notes in the ordinary
course of such holder's business and has no arrangements with any person to
participate in the distribution of the Exchange Notes) to trade such
Registrable Notes for Exchange Notes from and after their receipt without any
limitations or restrictions under the Securities Act, subject as to a Broker-
Dealer to the provisions of Section 1(b) hereof, or the Exchange Act and
without material restrictions under the securities laws of a substantial
proportion of the several states of the United States. Each holder of
Registrable Notes who participates in the Exchange Offer and who desires to
receive Exchange Notes that will not be subject to any limitations or
restrictions on resale under the Securities Act will be required to represent
in writing to the Company that any Exchange Notes received by it will be
acquired in the ordinary course of its business, that at the time of
consummation of the Exchange Offer such holder of Registrable Notes will have
no arrangement or understanding with any person to participate in the
distribution of the Exchange Notes, and that such holder of the Registrable
Notes is not an affiliate of the Company within the meaning of the Securities
Act. Upon consummation of the Exchange Offer in accordance with this Section
1, the Company shall have no further obligation to register Registrable Notes
pursuant to Section 2 of this Agreement.
(b) The Company shall indicate in a "Plan of Distribution"
section contained in the final prospectus constituting a part of the
registration statement relating to the Registered Exchange Offer that any
broker or dealer registered under the Exchange Act (each a "Broker-Dealer") who
holds Registrable Notes that were acquired for its own account as a result of
market-making activities or other trading activities (other than Registrable
Notes acquired directly from the
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Company), may exchange such Registrable Notes for Exchange Notes pursuant to
the Registered Exchange Offer; however, such Broker-Dealer may be deemed an
"underwriter" within the meaning of the Securities Act and, therefore, must
deliver a prospectus meeting the requirements of the Securities Act in
connection with any resales of the Exchange Notes received by it in the
Registered Exchange Offer, which prospectus delivery requirement may be
satisfied by the delivery by such Broker-Dealer of the final prospectus
contained in the registration statement relating to the Registered Exchange
Offer. Such "Plan of Distribution" section also shall state that the delivery
by a Broker-Dealer of the final prospectus relating to the Registered Exchange
Offer in connection with resales of Exchange Notes shall not be deemed to be an
admission by such Broker-Dealer that it is an "underwriter" within the meaning
of the Securities Act, and shall contain all other information with respect to
resales of the Exchange Notes by Broker-Dealers that the Commission may require
in connection therewith, but such "Plan of Distribution" shall not name any
such Broker-Dealer or disclose the amount of Exchange Notes held by any such
Broker-Dealer except to the extent required by the Commission as a result of a
change in policy after the date of this Agreement.
(c) In connection with such Registered Exchange Offer and the
offer and sale of Exchange Notes by Broker-Dealers as contemplated above, the
Company shall take such other and further action, including making appropriate
filings under state securities laws and delivering such number of final
prospectuses relating to the Registered Exchange Offer as any Broker-Dealer
proposing to deliver the same in connection with its resales of Exchange Notes
may reasonably request, as may be necessary to realize the foregoing
objectives. The Company shall cause the registration statement relating to the
Registered Exchange Offer to remain continuously effective for a period of one
year from the date on which such registration statement is first declared
effective, and shall supplement or amend the prospectus contained therein, in
each case, to the extent necessary to permit such prospectus (as supplemented
or amended) to be delivered by Broker-Dealers in connection with their resales
of Exchange Notes as aforesaid.
2. Notes Shelf Registration. The following provisions shall apply,
only if, because of any change in currently prevailing interpretations of the
Commission's staff, the Company is not permitted to effect a Registered
Exchange Offer, as contemplated by Section 1 hereof:
(a) Promptly (and in any event not more than 60 days)
following the date of closing (the "Closing Date") of the sale of the Notes,
the Company shall file with the Commission, and thereafter use its best efforts
to have declared effective not later than 120 days after the Closing Date, a
registration statement on an appropriate form under the Securities Act relating
to the offer and sale of the Registrable Notes by the holders thereof, from
time to time in accordance with the methods of distribution set forth in such
registration statement and Rule 415 under the Securities Act (the "Notes Shelf
Registration").
(b) The Company agrees to use its best efforts to keep the
registration statement relating to the Notes Shelf Registration continuously
effective in order to permit the prospectus
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included therein to be usable by the holders of the Registrable Notes for a
period of two years from the Closing Date or such shorter period that will
terminate when all the Registrable Notes covered by the registration statement
have been sold pursuant to such registration statement; provided, that the
Company shall be deemed not to have used its best efforts to keep the
registration statement effective during the requisite period if it voluntarily
takes any action that would result in holders of the Registrable Notes covered
thereby not being able to offer and sell such Registrable Notes during that
period, unless such action is required by applicable law, and provided,
further, that the foregoing shall not apply if the Company determines, in its
reasonable judgment, upon advice of counsel, as authorized by a resolution of
its Board of Directors, that the continued effectiveness and usability of such
registration statement would (i) require the disclosure of material
information, which the Company has a bona fide business reason for preserving
as confidential, or (ii) interfere with any financing, acquisition, corporate
reorganization or other material transaction involving the Company or any of
its Affiliates (as defined in the rules and regulations adopted under the
Exchange Act); provided, however, that the failure to keep the registration
statement effective and usable for offers and sales of Registrable Notes for
such reasons shall last no longer than 60 days in any 12-month period
(whereafter Notes Liquidated Damages (as defined in Section 6) shall accrue and
be payable), so long as the Company promptly thereafter complies with the
requirements of Section 3(h) hereof, if applicable. Any such period during
which the Company fails to keep the registration statement effective and usable
for offers and sales of Registrable Notes is referred to as a "Suspension
Period." A Suspension Period shall commence on and include the date that the
Company gives notice that the registration statement is no longer effective or
the prospectus included therein is no longer usable for offers and sales of
Registrable Notes and shall end on the date when each seller of Registrable
Notes covered by such registration statement either receives the copies of the
supplemented or amended prospectus contemplated by Section 3(h) hereof or is
advised in writing by the Company that use of the prospectus may be resumed.
(c) Notwithstanding any other provisions of this Agreement to
the contrary, the Company will cause the Notes Shelf Registration and the
related prospectus and any amendment or supplement thereto, as of the effective
date of such registration statement, amendment or supplement, (i) to comply in
all material respects with the applicable requirements of the Securities Act
and the rules and regulations of the Commission and (ii) not to contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading.
3. Registration Procedures. In connection with, to the extent
applicable, any Registered Exchange Offer pursuant to Section 1 hereof, or any
Notes Shelf Registration pursuant to Section 2 hereof, the following provisions
shall apply:
(a) If requested by any holder of Registrable Notes or the
managing underwriter, if any, with respect to the Notes Shelf Registration, the
Company shall furnish to each such holder of Registrable Notes or such managing
underwriter, prior to the filing thereof with the Commission,
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a copy of the applicable registration statement and each amendment thereof and
each supplement, if any, to the prospectus included therein. The Company shall
use its best efforts to reflect in each such document, when so filed with the
Commission, such comments as such holder or managing underwriter reasonably may
propose.
(b) The Company shall advise the holders of Registrable Notes
or the Exchange Notes, and the managing underwriter, if any, and, if requested
by any such person, confirm such advice in writing:
(i) when the applicable registration statement and any
amendment thereto has been filed with the Commission and when the
registration statement or any post-effective amendment thereto has
become effective;
(ii) of the issuance by the Commission of any stop order
suspending the effectiveness of the applicable registration statement or
the initiation of any proceedings for that purpose;
(iii) of the receipt by the Company of any notification
with respect to the suspension of the qualification of the Registrable
Notes or the Exchange Notes for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose; and
(iv) of the happening of any event that requires the
making of any changes in the registration statement or the prospectus in
order to make the statements therein not misleading (which advice shall
be accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made).
(c) The Company will make every reasonable effort to obtain
the withdrawal of any order suspending the effectiveness of the registration
statement at the earliest possible time.
(d) The Company will furnish to each holder of the Registrable
Notes or the Exchange Notes included within the coverage of the Registered
Exchange Offer or the Notes Shelf Registration, as appropriate, without charge,
at least one copy of the registration statement in the form in which it was
declared effective by the Commission and any post-effective amendment thereto,
including financial statements and schedules, and, if the holder so requests in
writing, all exhibits (including those incorporated by reference).
(e) The Company will deliver to each holder of the Registrable
Notes or the Exchange Notes included within the coverage of the Registered
Exchange Offer or the Notes Shelf Registration, as appropriate, without charge,
as many copies of the prospectus (including each preliminary prospectus)
included in the registration statement and any amendment or supplement thereto
as such persons may reasonably request; the Company consents to the use of the
prospectus
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or any amendment or supplement thereto by each of the selling holders of the
Registrable Notes or the Exchange Notes in connection with the offering and
sale of the Registrable Notes or the Exchange Notes covered by the prospectus
or any amendment or supplement thereto.
(f) Prior to any public offering of the Registrable Notes or
the Exchange Notes pursuant to the Registered Exchange Offer or the Notes Shelf
Registration, as the case may be, the Company will use its best efforts to
register or qualify, or cooperate with the holders of the Registrable Notes or
the Exchange Notes covered thereby and their respective counsel in connection
with the registration or qualification of, such Registrable Notes or Exchange
Notes for offer and sale under the securities or blue sky laws of such
jurisdictions as any seller reasonably requests in writing and do any and all
other acts or things necessary or advisable to enable the offer and sale in
such jurisdictions, of the Registrable Notes or the Exchange Notes covered by
the Registered Exchange Offer or the Notes Shelf Registration, as the case may
be; provided, that the Company will not be required to qualify generally to do
business in any jurisdiction where it is not then so qualified or to take any
action which would subject it to general service of process or to taxation in
any such jurisdiction where it is not then so subject.
(g) The Company will cooperate with the holders of the
Registrable Notes and the Exchange Notes to facilitate the timely preparation
and delivery of certificates representing the Registrable Notes and the
Exchange Notes to be sold in the Registered Exchange Offer or the Notes Shelf
Registration, as the case may be, free of any restrictive legends and in such
denominations and registered in such names as the holders may request provided
such request complies with the Indenture, prior to sales of the Registrable
Notes or the Exchange Notes, pursuant to the Registered Exchange Offer or the
Notes Shelf Registration, as the case may be.
(h) Upon the occurrence of any event contemplated by paragraph
(b)(iv) above, the Company will prepare a post-effective amendment to the
registration statement or a supplement to the related prospectus or file any
other required document so that, as thereafter delivered to purchasers of the
Registrable Notes or the Exchange Notes, the prospectus will not contain an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading.
(i) Not later than the effective date of the applicable
registration statement, the Company will provide a CUSIP number for the
Registrable Notes or the Exchange Notes, as the case may be, and provide the
Trustee with printed certificates for the Registrable Notes or the Exchange
Notes, as the case may be, in a form eligible for deposit with The Depository
Trust Company.
(j) The Company will use its best efforts to comply with all
applicable rules and regulations of the Commission and will make generally
available to its security holders an earnings statement satisfying the
provisions of Section 11(a) of the Securities Act, no later than 45 days after
the end of the 12-month period (or 90 days, if such period is a fiscal year)
beginning with the first
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month of the Company's first fiscal quarter commencing after the effective date
of each of the Registered Exchange Offer and the Notes Shelf Registration,
which statements shall cover such 12-month period.
(k) The Company will cause the Indenture to be qualified under
the Trust Indenture Act of 1939 upon effectiveness of the registration
statement contemplated by Section 1(a) or Section 2(a).
(l) The Company may require each holder of Registrable Notes
to be sold pursuant to the Notes Shelf Registration, to furnish to the Company
such information regarding the holder and the distribution of such Registrable
Notes as the Company may from time to time reasonably require for inclusion in
the registration statement. The Company may exclude from such registration the
Registrable Notes of any holder who unreasonably fails to furnish such
information in writing to the Company within ten business days (or longer time
period if agreed by the Company in writing) after receiving such request. Each
holder of Registrable Notes included within the coverage of any Registration
Statement shall furnish promptly to the Company all information required by
applicable law to be disclosed by such party in order to make the information
previously furnished to the Company not materially misleading.
(m) Each holder of Registrable Notes agrees by acquisition of
such Registrable Notes or Exchange Notes to be sold that, upon receipt of any
notice from the Company of the happening of any Suspension Period of the kind
described in Section 2(b), such holder will forthwith discontinue disposition
of such Registrable Notes or Exchange Notes covered by such registration
statement or prospectus until such holder's receipt of the copies of the
supplemented or amended prospectus contemplated by Section 3(h) hereof or is
advised in writing by the Company that use of the prospectus may be resumed.
4. Registration Expenses. The Company will bear all expenses
incurred in connection with the performance of its obligations under Sections 1
through 3 hereof and will bear or reimburse the holders of the Registrable
Notes for the reasonable fees and disbursements of one firm of counsel
designated by the holders of a majority in principal amount of the Registrable
Notes to act as counsel for the holders of the Registrable Notes in connection
therewith; provided that in any underwritten offering the Company shall not be
obligated to pay any underwriters' discounts and commissions nor any transfer
tax related to such offering.
5. Indemnification.
(a) Indemnification by Company. The Company shall indemnify
and hold harmless (i) the Initial Purchasers, (ii) in the case of the Notes
Shelf Registration, each holder of Registrable Notes, and (iii) in the case of
the Registered Exchange Offer, each Broker-Dealer who holds Exchange Notes
acquired for its own account pursuant to the Registered Exchange Offer, and,
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in any such case, the Initial Purchasers' and such holder's officers,
directors, employees and agents and each person who controls an Initial
Purchaser, now or hereafter, and each such holder within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act (each such
person being sometimes hereinafter referred to as an "Indemnified Person") from
and against any and all losses, claims, damages, liabilities and judgments
arising out of or based upon any untrue statement or alleged untrue statement
of a material fact contained in any registration statement or prospectus or in
any amendment or supplement thereto relating to the Notes Shelf Registration or
the Registered Exchange Offer, as the case may be, or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, except insofar as such losses,
claims, damages, liabilities or judgments are caused by any such untrue
statement or omission or allegation thereof based upon information relating to
such Indemnified Person furnished in writing to the Company by such Indemnified
Person expressly for use therein and used in conformity therewith; provided,
however, that in the event the Initial Purchasers or a Broker-Dealer are
required by law to deliver a final prospectus in connection with a Registered
Exchange Offer or a Note Shelf Registration and the indemnity obligations
arising under this Section 5(a) arise with respect to untrue statements or
omissions or untrue alleged statements or omissions made in a preliminary
prospectus, such indemnity obligations arising under this Section 5(a) shall
not inure to the benefit of the Initial Purchasers or any Broker-Dealer and its
controlling persons and their respective directors, officers and employees if
the person asserting any such Losses purchased the Notes from the Initial
Purchasers or such Broker-Dealer and if a copy of the final prospectus (as then
amended or supplemented if the Company shall have timely furnished any
amendments thereof or supplements thereto), was not sent or given by the
Initial Purchasers or such Broker-Dealer or on its behalf to such person at or
prior to the time such delivery was required by law, and if the final
prospectus (as then amended or supplemented if the Company shall have timely
furnished any amendments thereof or supplements thereto) would have cured the
defect giving rise to such Losses. The indemnity will be in addition to any
liability which the Company may otherwise have.
If any action or proceeding (including any governmental
investigation or inquiry) shall be brought or asserted against an Indemnified
Person, or notice of any such claim is received, in respect of which indemnity
may be sought from the Company, such Indemnified Person shall promptly notify
the Company in writing, and the Company shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to such Indemnified
Person and the payment of all reasonable fees and expenses of such defense;
provided that the failure by any such Indemnified Person to so notify the
Company shall not relieve the Company of its indemnification obligations under
Section 5(a) hereof, except to the extent that the Company is materially
prejudiced or forfeits substantive rights and defenses by reason of such
failure. Such Indemnified Person shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such counsel shall be the expense of such Indemnified
Person unless (A) the Company has agreed in writing to pay such fees and
expenses or (B) the Company shall have failed to assume the defense of such
action or proceeding and to employ counsel reasonably
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satisfactory to such Indemnified Person in any such action or proceeding within
a reasonable time after notice of commencement of such action or proceeding or
(C) the named parties to any such action or proceeding (including any impleaded
parties) include such Indemnified Person and the Company, and such Indemnified
Person shall have been advised in writing by counsel that there may be one or
more legal defenses available to such Indemnified Person that are different
from or additional to those available to the Company and in the reasonable
judgment of such counsel it is advisable for such Indemnified Party to employ
separate counsel (in which case, if such Indemnified Person notifies the
Company in writing that it elects to employ separate counsel at the expense of
the Company, the Company shall not have the right to assume the defense of such
action or proceeding on behalf of such Indemnified Person, it being understood,
however, that the Company shall not, in connection with any one such action or
separate but substantially similar or related actions or proceedings in the
same jurisdiction arising out of the same general allegations or circumstances,
be liable for the reasonable fees and expenses of more than one separate firm
of attorneys (in addition to local counsel) at any time for such Indemnified
Person and any other Indemnified Persons, which firm shall be designated in
writing by such Indemnified Persons (which shall be reasonably satisfactory to
the Company), and that all such fees and expenses shall be reimbursed as they
are billed). The Company shall not be liable for any settlement of any such
action or proceeding effected without their written consent (which consent
shall not be unreasonably withheld), but if settled with their written consent,
or if there be a final, unappealable judgment for the plaintiff in any such
action or proceeding, the Company agrees to indemnify and hold harmless such
Indemnified Persons from and against any loss or liability by reason of such
settlement or judgment. The Company shall not, without the prior written
consent of the Indemnified Person (which consent shall not be unreasonably
withheld), effect any settlement of any pending or threatened proceeding in
respect of which any Indemnified Person is a party and indemnity has been
sought hereunder by such Indemnified Person; provided however, that the Company
may effect such a settlement without the consent of such Indemnified Person if
such settlement includes an unconditional release of such Indemnified Person
from all lability for claims that are the subject matter of such proceeding or
the Company indemnifies such Indemnified Person in writing and post a bond for
an amount equal to the maximum liability for all such claims as contemplated
above or provide other security for such indemnity as shall be reasonably
satisfactory to such Indemnified Person.
(b) Indemnification by Holders. Each holder of Registrable
Notes agrees to indemnify and hold harmless the Company, its directors and
officers, employees and agents and each person, if any, controlling the Company
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent as the foregoing indemnity from the Company
to such holder, but only with respect to information relating to such holder or
the distribution furnished in writing by such holder expressly for use in any
registration statement or prospectus or any amendment or supplement thereto or
any preliminary prospectus relating thereto, provided, however, that no such
holder shall be liable for any indemnity claims hereunder in excess of the
amount of net proceeds received by such holder from the sale of Registrable
Notes pursuant
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to the Notes Shelf Registration. If any action or proceeding shall be brought
against the Company or its directors, officers, employees or agents or any such
controlling person, in respect of which indemnity may be sought against a
holder of Registrable Notes, such holder shall have the rights and duties given
the Company and the Company or their directors, officers, employees or agents
or such controlling person shall have the rights and duties given to each
holder by Section 5(a) hereof. The Company shall be entitled to receive
indemnities from underwriters, selling brokers, dealer managers and similar
securities industry professionals participating in the distribution, to the
same extent as provided above with respect to information so furnished in
writing by such persons specifically for inclusion in any prospectus or
registration statement or any amendment or supplement thereto.
(c) Contribution. If the indemnification provided for in
this Section 5 is unavailable to an indemnified party under Section 5(a) or
Section 5(b) hereof (other than by reason of exceptions provided in those
Sections) in respect of any losses, claims, damages, liabilities or judgments
referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or judgments in such proportion as is appropriate to reflect not
only the relative benefits but also the relative fault of the Company on the
one hand and of the Indemnified Person on the other in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or judgments, as well as any other relevant equitable
considerations. The relative fault of the Company on the one hand and of the
Indemnified Person on the other shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Indemnified Person and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable by a
party as a result of the losses, claims, damages, liabilities and expenses
referred to above shall be deemed to include, subject to the limitations set
forth in the second paragraph of Section 5(a), any legal or other fees or
expenses reasonably incurred by such party in connection with investigating or
defending any action or claim.
The Company and the holders of the Registrable Notes and Exchange
Notes agree that it would not be just and equitable if contribution pursuant to
this Section 5(c) were determined by pro rata allocation or by any other method
of allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. 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.
6. Additional Interest Under Certain Circumstances; Remedies.
If the Company fails to file within 60 days, or cause to become
effective within 120 days, the registration statement relating to the
Registered Exchange Offer or the Notes Shelf Registration, as applicable, or
(subject to Section 2(b)) the Notes Shelf Registration is declared
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effective but thereafter ceases to be effective in connection with resales of
the Registrable Notes (each such event, a "Registration Default"), then the
Company agrees to pay to each holder of Registrable Notes, accruing from the
date of the first such Registration Default (except in the event of the
commencement of a Suspension Period, in which case occurring from the 60th day
therefrom), liquidated damages in an amount equal to one-half of one percent
(.5%) per annum of the principal amount of Registrable Notes held by such
holder during the first 180-day period immediately following the occurrence of
the first such Registration Default, increasing by an additional one-half of
one percent (0.5%) per annum of the principal amount of such Registrable Notes
during each subsequent 180-day period, up to a maximum amount of liquidated
damages equal to two percent (2.0%) per annum of the principal amount of such
Registrable Notes ("Notes Liquidated Damages"), and ceasing to accrue on the
date such Registration Default has been cured by, as applicable, the filing,
declaration of effectiveness or withdrawal of suspension of effectiveness of
the applicable registration statement. The Company shall notify the Trustee
within one business day after (i) each and every Registration Default and (ii)
the date the Registration Default has been so cured. Until the Trustee and the
Paying Agent have received an Officers' Certificate from the Company to the
effect that all Notes Liquidated Damages then due have been paid in full, the
Company (in respect of any payment date) shall pay Notes Liquidated Damages
then due by depositing with the Trustee, in trust, for the benefit of the
affected holders of Registrable Notes, on or before the applicable semi-annual
interest payment date, immediately available funds in sums sufficient to pay
the liquidated damages then due and provide to the Trustee and the Paying Agent
a list of holders entitled to Notes Liquidated Damages together with the amount
of cash such holder is due. The Notes Liquidated Damages amount due shall be
payable as additional interest (from funds received pursuant to such deposit)
on each interest payment date to the record holder of Registrable Notes
entitled to receive the interest payment to be made on such date as set forth
in the Indenture.
7. Miscellaneous.
(a) 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, unless the Company has
obtained the written consent of holders of a majority in aggregate principal
amount of the Registrable Notes (insofar as such matters relate to the
Registrable Notes) or the Exchange Notes (insofar as such matters relate to the
Exchange Notes).
(b) Notices. All notices and other communications provided
for or permitted hereunder shall be made in writing by hand-delivery, first-
class mail, telex, telecopier, or air courier guaranteeing overnight delivery:
(i) if to a holder of Registrable Notes or Exchange
Notes, at the most current address given by such holder to the Company
in accordance with the provisions of this Section 7(b), which address
initially is, with respect to each holder, the address of such holder to
which confirmation of the sale of the Notes was first sent by the
Initial Purchasers,
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with a copy in like manner to Jefferies & Company, Inc., ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Corporate Finance Department;
(ii) if to the Initial Purchasers, to the address set
forth in clause (b)(i) above; and
(iii) if to the Company, initially at its address set
forth in the Purchase Agreement.
All such notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged by recipient's
telecopy operator, if telecopied; and on the day delivered, if sent by
overnight air courier guaranteeing next day delivery.
(c) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent holders of the Registrable Notes.
(d) Counterparts. This Agreement may be executed in any
number of 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.
(e) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(f) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to principles of conflicts of laws to the extent the application of the
law of another jurisdiction would be required thereby.
(g) Severability. If any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
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REGISTRATION RIGHTS AGREEMENT SIGNATURE PAGE
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first written above:
Very truly yours,
NATIONAL ENERGY GROUP, INC.
By:
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Name:
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Title:
-----------------------------
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REGISTRATION RIGHTS AGREEMENT SIGNATURE PAGE
Accepted and agreed to as of
the first date written above
JEFFERIES & COMPANY, INC.
PRUDENTIAL SECURITIES INCORPORATED
By: Jefferies & Company, Inc.
By:
-------------------------------
Name:
------------------------------
Title:
-----------------------------
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