EXHIBIT 5.5
AMENDED AND RESTATED
STOCK OWNERSHIP AND
REGISTRATION RIGHTS AGREEMENT
AMONG
TEXOIL, INC.
AND
RIMCO PARTNERS, L.P.,
RIMCO PARTNERS, X.X. XX,
RIMCO PARTNERS, L.P. III
AND
RIMCO PARTNERS, X.X. XX
DECEMBER 31, 1997
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AMENDED AND RESTATED
STOCK OWNERSHIP AND
REGISTRATION RIGHTS AGREEMENT
AMONG
TEXOIL, INC. AND
RIMCO PARTNERS, L.P., RIMCO PARTNERS, X.X. XX,
RIMCO PARTNERS, L.P. III AND RIMCO PARTNERS, X.X. XX
THIS AMENDED AND RESTATED STOCK OWNERSHIP AND REGISTRATION RIGHTS
AGREEMENT dated as of December 31, 1997, (this "Agreement") is among TEXOIL,
INC., a Nevada corporation (the "Company"), and RIMCO Partners, L.P., RIMCO
Partners, X.X. XX, RIMCO Partners, L.P. III and RIMCO Partners, X.X. XX
(collectively, the "RIMCO Holders," and together with their distributees,
successors and assigns, the "Holders"), is effective for all purposes as of the
date specified in Article III hereof.
W I T N E S S E T H:
WHEREAS, the Company, the RIMCO Holders and Texoil Company, a
Tennessee corporation, have entered into that certain Stock Ownership and
Registration Rights Agreement dated as of September 6, 1996, as amended by that
certain First Amendment to Stock Ownership and Registration Rights Agreement
dated as of May 21, 1997 (as so amended, the "Existing Registration Rights
Agreement"); and
WHEREAS, the Tranche A Notes and Tranche C Notes referred to in
the Existing Registration Rights Agreement have been exchanged for common stock
of the Company, par value $.01 per share (the "Common Stock") in accordance with
the terms of the Guaranty and Exchange Agreement; and
WHEREAS, pursuant to the terms and subject to the conditions of
that certain Note Purchase Agreement (the "Note Purchase Agreement") dated as of
even date herewith among the Company and the RIMCO Holders, the Company will
issue and sell to the RIMCO Holders the Notes; and
WHEREAS, the Notes are convertible according to the terms of the
Note Purchase Agreement for shares of the Common Stock; and
WHEREAS, the Company and the RIMCO Holders now desire to amend
and restate the Existing Registration Rights Agreement in accordance with the
terms hereof to, among other things, include in the Registrable Securities the
Shares issuable upon conversion of the Notes in the manner provided for in the
Note Purchase Agreement; and
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WHEREAS, Texoil Company is executing this Agreement to evidence
its agreement with the terms hereof; and
WHEREAS, the execution and delivery of this Agreement is a
condition precedent to the closing of the transactions contemplated by the Note
Purchase Agreement;
NOW, THEREFORE, to induce the parties hereto to close the
transactions contemplated by the Note Purchase Agreement (such closing referred
to herein as the "Closing") and in consideration of the aforesaid and of the
mutual representations, warranties and covenants contained herein and in the
Note Purchase Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, agree to amend and restate the Existing
Registration Rights Agreement to read as follows:
ARTICLE I
DEFINITIONS; COMPANY REPRESENTATIONS,
WARRANTIES AND COVENANTS
SECTION 1.01. CERTAIN DEFINED TERMS. Capitalized terms used herein and
not otherwise defined herein shall have the respective meanings set forth in the
Note Purchase Agreement and Annex A attached thereto. For purposes of this
Agreement,
"1933 ACT" means the Securities Act of 1933, as amended.
"1934 ACT" means the Securities and Exchange Act of 1934, as amended.
"AGREEMENT" has the meaning specified in the preamble.
"BLUE SKY FILING" has the meaning specified in SECTION 2.09(A).
"CLOSING" has the meaning specified in the recitals.
"COMMISSION" means the Securities and Exchange Commission.
"COMMON STOCK" has the meaning specified in the recitals.
"COMPANY" has the meaning specified in the preamble.
"DEMAND REGISTRATIONS" has the meaning specified in SECTION 2.01(A).
"EXISTING RIGHTS HOLDERS" means those Persons listed on SCHEDULE 1.07
attached hereto who hold existing registration rights.
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"GUARANTY AND EXCHANGE AGREEMENT" means that certain Amended and
Restated Guaranty and Exchange Agreement, dated May 21, 1997, among the Company,
the RIMCO Holders, and Texoil Company.
"HOLDERS" has the meaning specified in the preamble.
"MERGER AGREEMENT" means that certain Agreement and Plan of Merger dated
of even date herewith among the Company, Texoil Acquisition, Inc. and Cliffwood
Oil & Gas Corp.
"NOTE PURCHASE AGREEMENT" has the meaning specified in the recitals.
"NOTES" means the 7.875% Convertible Subordinated General Obligation
Notes the subject of the Note Purchase Agreement.
"PERMITTED INTERRUPTION" has the meaning specified in SECTION 2.01(G).
"PIGGYBACK REGISTRATION" has the meaning specified in SECTION 2.02(A).
"REGISTRABLE SECURITIES" means the Shares and the Related Securities. As
to any particular Registrable Securities, once issued such securities shall
cease to be Registrable Securities when (a) a registration statement with
respect to the sale of such securities shall have become effective under the
1933 Act and such securities shall have been disposed of in accordance with the
plan of distribution set forth in such registration statement, (b) such
securities shall have been distributed in accordance with Rule 144 under the
1933 Act or (c) 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 subsequent
disposition of such securities shall not require registration or qualification
under the 1933 Act or any similar state law then in force.
"REGISTRATION EXPENSES" has the meaning specified in SECTION 2.07.
"RELATED SECURITIES" means, collectively, other than the Shares, (i) any
and all securities issued or issuable as a result of adjustments made under the
Guaranty and Exchange Agreement or the Note Purchase Agreement, and in each case
any and all securities otherwise exchanged or converted therefor or distributed,
issued or issuable with respect thereto and (ii) any and all securities of the
Company or any successor thereto or assignee thereof that are hereafter
transferred, distributed, issued or issuable to the Holders.
"RIMCO HOLDERS" has the meaning specified in the preamble.
"SHARES" means, collectively, shares of the Common Stock issued or
issuable upon the exchange of the Tranche A Notes and the Tranche C Notes under
the Guaranty and Exchange Agreement and the conversion of the Notes and all
shares of the Common Stock exchanged or converted therefor or distributed,
issued or issuable with respect thereto.
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SECTION 1.02. UNDERTAKING TO FILE REPORTS AND COOPERATE IN RULE 144
TRANSACTIONS. For as long as any Holder shall continue to hold any Registrable
Securities, the Company shall file, on a timely basis, all annual, quarterly and
other reports required to be filed by it under Sections 13 and 15(d) of the 1934
Act and the rules and regulations promulgated by the Commission thereunder, as
amended from time to time during the term of this Agreement. In the event of any
proposed transfer of Registrable Securities other than pursuant to a sale or
transfer registered under the 1933 Act, the Company shall cooperate with each
Holder so as to enable such sales to be made in accordance with applicable laws,
rules and regulations, the requirements of the Company's transfer agents, and
the reasonable requirements of the broker through which the sales are proposed
to be executed, and shall, upon request and subject to applicable law, furnish
unlegended certificates representing Shares and Related Securities in such
numbers and denominations as any Holder shall reasonably require for delivery
pursuant to such sales. The Holders will have all of the rights set forth in
this Agreement to require a registration of the offering of the Registrable
Securities notwithstanding any availability of Rule 144 under the 1933 Act with
respect to the sale of all or part of the Registrable Securities.
SECTION 1.03. ELECTION OF DIRECTOR TO BOARD OF DIRECTORS OF THE COMPANY.
(a) Subject to compliance with applicable law, immediately following the
issuance of any of the Notes by the Company, the RIMCO Holders holding not less
than a majority (in then market value) of the then outstanding Notes and
Registrable Securities held by the RIMCO Holders, or any designee thereof, shall
be entitled to designate one person to be a member of the Company's Board of
Directors. The Company will use its reasonable best efforts, subject to
compliance with applicable law, to elect or cause to be elected the person
designated by the RIMCO Holders or their designee, so long as (i) any of the
Notes (or any securities converted therefor) are outstanding or (ii) the RIMCO
Holders, together with their Affiliates, own an aggregate of 5% or more of the
Common Stock, however acquired (or a then comparable proportion of the equity
securities of the Company entitled to vote for the election of directors). In
the event of any resignation, removal, death or other termination of the
director so designated by the RIMCO Holders or their designee, or the failure of
the stockholders of the Company for any reason to elect such designee or to
reelect such director, the RIMCO Holders holding not less than a majority (in
then market value) of the then outstanding Notes and Registrable Securities held
by the RIMCO Holders, or any designee thereof, shall be entitled to designate
one person to serve on the Company's Board of Directors in place of such
previously designated person, and the Company will use its reasonable best
efforts, subject to compliance with applicable law, to elect or cause to be
elected to the Board of Directors the person so designated by the RIMCO Holders
or their designee. The RIMCO Holders hereby undertake and agree that, not later
than 15 days following written request from the Company, the RIMCO Holders or
their designee shall furnish to the Company's Board of Directors such
information with respect to such director designee as is required to comply with
applicable law, rule or regulation, and with Items 401 and 404 of Regulation S-K
or Regulation S-B or any successor regulation under the 1933 Act, if then
applicable to the Company.
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SECTION 1.04. NO EXECUTIVE COMMITTEE. Until all the Notes are retired
or converted, there shall be no Executive Committee of the Company's Board of
Directors.
SECTION 1.05. SECTIONS 411 THROUGH 444 OF THE NEVADA GENERAL CORPORATION
LAW. If at any time the Company shall be governed by Sections 411 through 444 of
the Nevada General Corporation Law, the Company hereby covenants that it will
use its reasonable best efforts, subject to compliance with applicable law, to
take all actions necessary under Nevada law, including, without limitation, the
approval by the Board of Directors of the Company of the Transaction Documents
and the consummation of the transactions contemplated thereby, to render the
provisions of Sections 411 through 444 of the Nevada General Corporation Law
inapplicable to the RIMCO Holders and their affiliates and to the transactions
contemplated in the Transaction Documents, including, without limitation, the
acquisition of shares of the Common Stock by the RIMCO Holders pursuant to the
transactions contemplated by the Transaction Documents, as may be amended from
time to time.
SECTION 1.06. EXCHANGE LISTING. The Company shall as promptly as
practicable prepare and file an application to list the Registrable Securities
on each exchange or automated market on which comparable securities of the
Company are then traded, including, without limitation, the Boston Stock
Exchange (if applicable), effective as soon as practicable after the issuance of
such Registrable Securities and shall use its reasonable best efforts to cause
such application to be approved as promptly as practicable.
SECTION 1.07. OTHER REGISTRATION RIGHTS. The Company hereby represents
and warrants that there are no existing rights held by any Person to register
the offering of any securities of the Company under the 1933 Act or any
successor statute ("registration rights") other than (a) the rights granted in
this Agreement and the Merger Agreement, (b) the registration rights described
on SCHEDULE 1.07 granted to the Existing Rights Holders, and (c) the
registration rights granted under that certain Underwriters' Warrant Agreement
dated June 8, 1994 among the Company and Toluca Pacific Securities Corporation,
Tamaron Investments, Inc. and Xxxxx Xxxxxxxxx, Inc. Other than the existing
registration rights described in the immediately preceding sentence, the Company
will not grant any registration rights in favor of any Person with respect to
any of the Company's securities without the prior written consent of the
Holders.
ARTICLE II
REGISTRATION RIGHTS
SECTION 2.01. DEMAND REGISTRATIONS. (a) GENERAL. Upon the written
request to the Company of Holders of not less than a majority (in then market
value) of the then outstanding Registrable Securities, including not less than a
majority (in then market value) of the then outstanding Registrable Securities
held by the RIMCO Holders, that the Company effect the registration under the
1933 Act, such registration to occur at any time, of all or part of the
Registrable Securities and specifying the intended method of disposition
thereof, the Company will
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give prompt written notice of such request to all other Holders and to all other
Persons, if any, who have contractual rights to request that any of their shares
be piggybacked onto any registration form proposed to be used to register the
Registrable Securities requested by such Holders, and thereupon the Company
will, subject to the provisions of this Agreement, use its reasonable best
efforts to include in the registration under the 1933 Act all shares of the
Common Stock that persons having contractual registration rights with respect to
such shares have requested in writing that the Company register, PROVIDED such
request is given to the Company within 20 days after the receipt of the
aforesaid written notice by the Company (specifying the intended method of
disposition of such the Common Stock), all to the extent requisite to permit the
intended disposition of the Registrable Securities and shares of the Common
Stock to be so registered. All registrations requested by any Holders pursuant
to this SECTION 2.01(A) are referred to herein as "Demand Registrations."
(b) NUMBER OF DEMAND REGISTRATIONS. Subject to the provisions of SECTION
2.01(A), the Holders shall be entitled to request two Demand Registrations.
(c) REGISTRATION OF OTHER SECURITIES. Whenever the Company shall effect
a Demand Registration of Common Stock pursuant to SECTION 2.01(A) in connection
with an underwritten offering by the Holders, no securities other than shares of
the Common Stock shall be included among the securities covered by such
registration unless (i) the managing underwriter of such offering shall have
advised the Company in writing that the inclusion of such other securities would
not adversely affect such offering and (ii) the Holders of Registrable
Securities participating in such Demand Registration shall have consented in
writing to the inclusion of such other securities.
(d) REGISTRATION STATEMENT FORM. Demand Registrations shall be on such
appropriate registration form of the Commission (excluding Form S-8 or Form S-4
(or any successor form)) (i) as shall be selected by the Company and shall be
reasonably acceptable to the Holders and (ii) as shall permit the disposition of
such Registrable Securities in accordance with the intended method or methods of
disposition specified in the Holders' request for such registration, including,
without limitation, a "shelf offering" or disposition pursuant to Rule 415 under
the 1933 Act. The Company and the Holders agree to include in any such
registration statement all information and exhibits that, in the opinion of
counsel to the Holders or counsel to the Company, is required to be included
therein.
(e) EFFECTIVE REGISTRATION STATEMENT. A registration requested pursuant
to SECTION 2.01(A) shall not be deemed to have been effected and will NOT be
considered one of the Demand Registrations which may be requested pursuant to
this Agreement if (i) a registration statement with respect thereto has not
become effective or if the request for the Demand Registration is withdrawn
prior to effectiveness or such registration is interfered with by any stop
order, injunction or other order or requirement of the Commission or other
governmental agency or court for any reason and has not thereafter become
effective, (ii) after it has become effective, it does not remain effective for
a period of at least 120 days or, in the case of a "shelf" registration or
registration pursuant to Rule 415 under the 1933 Act, for a period of at least
two years (unless the Registrable Securities registered thereunder have been
sold or disposed of prior to the expiration of such 120-day period
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or such two-year period, as the case may be), (iii) the conditions to closing
specified in any underwriting agreement entered into in connection with such
registration are not satisfied or waived other than by reason of the failure or
refusal of the Holders to satisfy or perform a condition to such closing or (iv)
the Holders are not able to register and sell all of the Registrable Securities
requested to be included in such Demand Registration, but only if such
registration statement is for a "firm commitment underwriting" rather than for
an "at the market sale" by the Holders. In any event, the Company shall pay all
Registration Expenses in connection with any such registration initiated but not
so effected.
(f) PRIORITY ON DEMAND REGISTRATIONS. In the event that the managing
underwriters of a requested Demand Registration advise the Company in writing
that in their opinion the number of shares of Registrable Securities and other
shares requested to be included in any such registration exceeds the number of
securities that can be sold in such offering, the Company shall include in such
registration only the number of shares of Registrable Securities and other
shares requested to be included that in the opinion of such underwriters can be
sold. If the number of Registrable Securities and other shares requested to be
included requested to be sold in a Demand Registration exceeds the number of
shares of Registrable Securities and other shares requested to be included that
can be sold, the Company shall include in such Demand Registration (i) FIRST,
the Registrable Securities requested to be included therein by the Holders, and
(ii) SECOND, other securities requested to be included in such registration.
(g) RESTRICTIONS ON DEMAND REGISTRATIONS. The Company shall not be
obligated to effect any Demand Registration within 180 days after the effective
date of a previous Demand Registration or a previous registration under which
any Holder exercised piggyback rights pursuant to SECTION 2.02 hereof. The
Company may postpone (such postponement referred to herein as a "Permitted
Interruption") for a reasonable period of time (not to exceed 90 days, which may
not thereafter be extended without approval by the Holders participating in such
Demand Registration, which approval will not be unreasonably withheld) the
filing or the effectiveness of a registration statement for a Demand
Registration if, at the time it receives a request for such registration (i) the
Company is engaged in any active program for repurchase of Common Stock and
furnishes to the Holders an Officer's Certificate to that effect, (ii) the
Company is conducting or about to conduct an offering of the Common Stock or
other securities and the Company is advised by the investment banker engaged by
the Company to conduct the offering that such offering would be affected
adversely by the registration so demanded and the Company furnishes to the
Holders an Officer's Certificate to that effect, or (iii) the board of directors
of the Company shall determine in good faith that such offering will interfere
with a pending or contemplated financing, merger, acquisition, business
combination, sale of assets, recapitalization or other similar corporate action
of the Company and the Company furnishes to the Holders an Officer's Certificate
to that effect. After such Permitted Interruption, the Company shall effect such
registration as promptly as practicable without further request from the Holders
unless such request has been withdrawn.
(h) SELECTION OF UNDERWRITERS. The Holders shall have the right to
select such investment bankers and managers as shall be reasonably acceptable to
the Company to administer the offering
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of Registrable Securities for which a Demand Registration is requested. The
Holders shall, in their sole discretion, negotiate the terms of the
underwriters' fees and expenses, the underwriting discount and commission and
the transfer taxes.
(i) PREEMPTION OF DEMAND REGISTRATION. Notwithstanding anything to the
contrary contained herein, if at any time a Demand Registration has been
requested pursuant to SECTION 2.01(A), the Company may elect to effect an
underwritten primary registration on behalf of the Company if the Company's
Board of Directors believes that such primary registration would be in the best
interests of the Company or if the managing underwriter for the requested Demand
Registration advises the Company in writing that in their opinion in order to
sell the Registrable Securities subject to such Demand Registration the Company
should include its own securities. Promptly after receiving a request for a
Demand Registration, the Company shall notify the members of its Board of
Directors (and the Board of Directors shall consider the issue within 30 days
after receiving such request), and the Company shall meet with the managing
underwriter and shall decide whether or not to effect an underwritten primary
registration on behalf of the Company, and failure to convene such a meeting and
make such determination within such 30-day period shall constitute a waiver by
the Company of its right to preempt a Demand Registration under this SECTION
2.01(I). If the Company elects to effect a primary registration after receiving
a request to effect a Demand Registration, the Company shall give prompt written
notice (and in any event within 60 days after receiving a request for a Demand
Registration) to each Holder requesting such Demand Registration of the
Company's intention to effect such a primary registration and shall afford such
Holder or Holders rights to Piggyback Registrations contained in SECTION 2.02
hereof. If the Company elects to effect a primary registration after receiving a
request to effect a Demand Registration, such registration shall not count as
one of the Demand Registrations of the Holders permitted under SECTION 2.01(B)
hereof, unless all Registrable Securities requested to be included in the Demand
Registration are included in such primary registration.
SECTION 2.02. PIGGYBACK REGISTRATIONS. (a) GENERAL. Whenever the Company
proposes to register any shares of the Common Stock or other equity securities
under the 1933 Act (other than the shelf registration the Company is obligated
to undertake pursuant to the Merger Agreement or registrations solely for shares
to be issued in connection with any employee benefit plan or a merger,
consolidation or other business combination registered on Form S-4 (or any
successor form thereto)) and the registration form to be used may be used for
the registration of Shares or Related Securities, as the case may be (a
"Piggyback Registration"), the Company shall give prompt written notice (in any
event within 10 business days after its receipt of notice of any exercise of
other registration rights) to each Holder of its intention to effect such a
registration and shall use its reasonable best efforts to include in such
registration all of the Registrable Securities with respect to which the Company
receives from any Holder a written request for inclusion therein within 20 days
after the receipt by the Holders of the Company's notice (five business days if
the Company gives telephonic notice to the Holders, with written confirmation to
follow immediately thereafter, stating that (i) such registration will be on
Form S-3 (or any comparable or successor form or comparable form then applicable
to small business issuers) and (ii) such shorter period of time is required
because of a planned filing date), which request shall specify the number of
Registrable Securities requested to
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be included in such registration by such Holder. If the Company elects, prior to
effectiveness, not to proceed with the proposed registration of Common Stock or
other equity securities, it shall not be obligated to register any Registrable
Securities pursuant to such registration unless such primary registration was a
primary registration initiated as provided in SECTION 2.01(I) after the Company
received a request for Demand Registration.
(b) PRIORITY ON PRIMARY REGISTRATIONS. If a Piggyback Registration is an
underwritten primary registration on behalf of the Company and the managing
underwriter of such offering advises the Company in writing that in their
opinion the number of securities requested to be included in such registration
exceeds the number that can reasonably be sold in such offering, then the
Company shall include in such registration (i) FIRST, the securities that the
Company proposes to sell, (ii) SECOND, the Registrable Securities and other
securities requested to be included therein by one or more Holders or Existing
Rights Holders, on a PRO RATA basis according to the number of securities
originally requested to be included by each Holder and Existing Rights Holder,
and (iii) THIRD, securities requested to be included therein by any other
persons having registration rights with respect to securities of the Company. If
the managing underwriter of such offering subsequently advises the Company in
writing that the number of securities that can be sold exceeds the number of
securities included in the offering, the Company shall include in the
registration (i) FIRST, the securities that the Company proposes to sell, (ii)
SECOND, such additional securities that one or more Holders or Existing Rights
Holders had originally requested be included in the registration, on a PRO RATA
basis according to the number of securities originally requested to be included
by each Holder and Existing Rights Holder, and (iii) THIRD, securities requested
to be included therein by any other persons having registration rights with
respect to securities of the Company.
(c) PRIORITY ON SECONDARY REGISTRATIONS. If a Piggyback Registration is
an underwritten secondary registration on behalf of holders of the Company's
securities other than the Holders and the managing underwriter of such offering
advises the Company in writing that in their opinion the number of securities
requested to be included in such registration exceeds the number that can
reasonably be sold in such offering, then the Company shall include in such
registration (i) FIRST, if such registration is being made on behalf of other
stockholders of the Company exercising demand registration rights, then the
securities so requested to be included therein in accordance with such demand
registration rights, (ii) SECOND, the Registrable Securities and other
securities requested to be included in such registration by one or more Holders
or Existing Rights Holders, on a PRO RATA basis according to the number of
securities originally requested to be included by each Holder and Existing
Rights Holder, and (iii) THIRD, securities requested to be included therein by
any other persons having registration rights with respect to securities of the
Company. If the managing underwriter of such offering subsequently advises the
Company in writing that the number of securities that can be sold exceeds the
number of securities included in the offering, the Company shall include in the
registration (i) FIRST, the securities proposed to be sold on behalf of the
other stockholders of the Company exercising demand registration rights, (ii)
SECOND, such additional securities that one or more Holders or Existing Rights
Holders had originally requested be included in the registration, on a PRO RATA
basis according to the number of securities originally requested to be included
by each Holder and Existing Rights Holder, and (iii) THIRD, securities requested
to be
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included therein by any other persons having registration rights with respect to
securities of the Company.
(d) OTHER REGISTRATIONS. If (i) the Company has previously filed a
registration statement with respect to any of the Registrable Securities
pursuant to SECTION 2.01(A) OR 2.02(A) and (ii) such previous registration has
not been withdrawn or abandoned, the Company shall not file or cause to be
effective any other registration of any of its equity securities or securities
convertible or exchangeable into or exercisable for its equity securities under
the 1933 Act (except on Form S-8 or Form S-4 or any successor form), whether on
its own behalf or at the request of any holder or holders of such securities,
until a period of at least 180 days has elapsed from the effective date of such
previous registration (and, during the period of any "shelf offering" or
offering pursuant to Rule 415 under the 1933 Act, during such time as any Holder
is engaged in selling efforts pursuant thereto, except with the prior written
consent of the Holders named in the prospectus for such "shelf offering").
(e) PIGGYBACK NOT A DEMAND REGISTRATION. Should any Holder's
participation in a registration be pursuant to a Piggyback Registration in
connection with (i) an underwritten primary registration on behalf of the
Company as described in SECTION 2.02(B), or (ii) an underwritten secondary
registration on behalf of holders of the Company's securities other than the
Holders as described in SECTION 2.02(C), then such participation by any Holder
shall not constitute a Demand Registration for purposes of determining the
number of Demand Registrations the Holders are entitled to pursuant to SECTION
2.01(B).
SECTION 2.03. HOLDBACK AGREEMENTS. (a) GENERAL. Each Holder hereby
agrees not to effect any public sale or distribution of equity securities of the
Company, or any securities convertible into or exchangeable or exercisable for
such securities, including, without limitation, sales pursuant to Rule 144 under
the 1933 Act (or any similar rule then in effect), during the 10 days prior to
and the 90 days beginning on the effective date of any underwritten Demand
Registration or any underwritten Piggyback Registration in which Registrable
Securities are included (except as part of such underwritten registration)
unless the underwriters managing the registered public offering otherwise agree.
(b) AGREEMENT BY THE COMPANY. The Company agrees not to effect any
public sale or distribution of its equity securities, or any securities
convertible into or exchangeable or exercisable for such securities, during the
10 days prior to and during the 90 days beginning on the effective date of any
underwritten Demand Registration or any underwritten Piggyback Registration in
which Registrable Securities are included (except as part of such underwritten
registration in accordance with the provisions of this Agreement) unless the
underwriters managing the registered public offering otherwise agree.
(c) REGISTRATION PROCEDURES. Whenever any Holder requests registration
pursuant to this Agreement, the Company shall use its reasonable best efforts to
effect the registration of Registrable
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Securities for which registration is requested in accordance with the intended
method of disposition thereof, and pursuant thereto the Company shall as
expeditiously as possible:
(i) prepare and file with the Commission a registration statement with
respect to such securities and use its reasonable best efforts to cause
such registration statement to become effective (provided that before
filing a registration statement or prospectus or any amendments or
supplements thereto, the Company will furnish to the counsel selected by
the Holders copies of all documents proposed to be filed, which
documents will be subject to the review of such counsel);
(ii) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith and prepare and file any related registration
statement pursuant to Rule 462 under the 1933 Act, in each case as
necessary to keep such registration statement or registration statements
effective for a period of not less than 90 days after such registration
statement is declared effective, provided that the Company shall have no
obligation pursuant to this Agreement to maintain the effectiveness of
such registration statement after the sale of the securities registered
thereunder, and shall comply with the provisions of the 1933 Act with
respect to the disposition of all securities owned by each Holder that
are covered by such registration statement during such period in
accordance with the intended methods of disposition by such Holder;
(iii) furnish to the Holders such number of copies of such registration
statement, each amendment and supplement thereto, the prospectus
included in such registration statement (including each preliminary
prospectus) and such other documents as any Holder may reasonably
request in order to facilitate the disposition of the Registrable
Securities owned by such Holder;
(iv) use its reasonable best efforts to register or qualify such
Registrable Securities under such other securities or Blue Sky Laws of
such jurisdictions as any Holder requests and do any and all other acts
and things that may be necessary or advisable to enable each Holder to
consummate the disposition in such jurisdictions of the Registrable
Securities (provided that the Company will not be required to (A)
qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this sub-clause (iv), (B)
subject itself to taxation in any such jurisdiction or (c) consent to
general service of process in such jurisdiction);
(v) cause all such shares of Registrable Securities to be listed on each
securities exchange or qualified for trading on each market on which
securities issued by the Company that are of the same class as the
Registrable Securities are then listed or traded;
(vi) provide a transfer agent and registrar for all such Registrable
Securities no later than the effective date of such registration
statement;
-11-
(vii) obtain a "cold comfort" letter from the Company's independent
public accountants in customary form, covering such matters of the type
customarily covered by "cold comfort" letters delivered to underwriters,
and covering such other matters as any Holder may reasonably request;
and obtain an opinion of counsel for the Company in customary form,
covering such matters of the type customarily covered in opinions of
legal counsel delivered to underwriters, and covering such other matters
as any Holder may reasonably request;
(viii) if underwriters are engaged in connection with any registration
referred to in this Agreement, the Company shall provide customary
indemnification, representations, covenants, opinions, and other
assurances to the underwriters, in each case in form and substance
reasonably satisfactory to such underwriter;
(ix) notify each Holder and the managing underwriters, if any, promptly,
and (if requested by any such Person) confirm such advice in writing,
(A) when a prospectus or any prospectus supplement or post-effective
amendment (or related registration statement filed pursuant to Rule 462
under the 0000 Xxx) has been filed, and, with respect to a registration
statement or any post-effective amendment, when the same has become
effective, (B) of any request by the Commission for amendments or
supplements to a registration statement or related prospectus or for
additional information, (C) of the issuance by the Commission of any
stop order suspending the effectiveness of a registration statement or
the initiation of any proceedings for that purpose, (D) of the receipt
by the Company of any notification with respect to the suspension of the
qualification of any of the registrable securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose, (E) of the happening of any event that requires the making of
any changes in a registration statement or related prospectus so that
such documents 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 (F) of the
Company's reasonable determination that a post-effective amendment to a
registration statement would be required;
(x) notify each Holder at any time when a prospectus relating thereto is
required to be delivered under the 1933 Act, of the occurrence of any
event as a result of which the prospectus included in such registration
statement contains an untrue statement of a material fact or omits any
fact necessary to make the statements therein not misleading, and, at
the request of any Holder, the Company shall prepare a supplement or
amendment to such prospectus so that, as thereafter delivered to the
purchasers of such shares such amended or supplemented prospectus shall
not contain an untrue statement of a material fact or omit to state any
fact necessary to make the statements therein not misleading;
(xi) use its reasonable best efforts to obtain as soon as reasonably
practicable the withdrawal of any order suspending the effectiveness of
a registration statement, or the lifting of any suspension of the
qualification of any of the Registrable Securities for sale in any
jurisdiction;
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(xii) if requested by the managing underwriters or any Holder,
incorporate in a prospectus supplement or post-effective amendment such
information as the managing underwriter and the Holders agree should be
included therein relating to the sale and distribution of Registrable
Securities, including, without limitation, information with respect to
the number of Registrable Securities being sold to such underwriters,
the purchase price being paid therefor by such underwriters and with
respect to any other terms of the underwritten (or best efforts
underwritten) offering of the Registrable Securities to be sold in such
offering; make all required filings of such prospectus supplement or
post-effective amendment as soon as notified of the matters to be
incorporated in such prospectus supplement or post-effective amendment;
and supplement or make amendments to any registration statement if
requested by any Holder or any underwriter of such securities;
(xiii) furnish to each Holder and each managing underwriter, without
charge, such signed copies of the registration statement or statements
and any post-effective amendment thereto, including financial statements
and schedules, all documents incorporated therein by reference and all
exhibits (including those incorporated by reference) as any Holder or
managing underwriter may reasonably request;
(xiv) cooperate with reasonable requests of the Holders and the managing
underwriter, if any, to facilitate the timely preparation and delivery
of certificates representing Shares or Related Securities to be sold and
not bearing any restrictive legends unless required by applicable law;
and enable such certificates to be in such denominations and registered
in such names as the managing underwriter may request at least two
business days prior to any sale of Registrable Securities to the
underwriters;
(xv) in the case of an underwritten offering, enter into such customary
agreements (including underwriting agreements in customary form) and
take all such other actions as any Holder or underwriter reasonably
requests in order to expedite or facilitate the disposition of such
Registrable Securities; and
(xvi) make available for inspection by any Holder, any underwriter
participating in any disposition pursuant to such registration
statement, and any attorney, accountant or other agent retained by any
such Holder or underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the
Company's officers, directors, employees and independent accountants to
supply all information reasonably requested by any such Holder,
underwriter, attorney, accountant or agent in connection with such
registration statement.
SECTION 2.04. COMPANY REPORTS. The Company shall file all reports
required to be filed by it under the 1933 Act and the 1934 Act and the rules and
regulations promulgated by the Commission thereunder, and take such further
reasonable action as may be necessary or appropriate for the Company to use Form
S-2 or S-3 (or any similar registration form then applicable to small business
issuers or hereafter adopted by the Commission) to register the Registrable
Securities for
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sale thereon. Upon request, the Company shall deliver to the Holders a written
statement as to whether it has complied with such requirements.
SECTION 2.05. INFORMATION TO BE FURNISHED BY THE HOLDERS. In connection
with any registration of shares of Registrable Securities hereunder, the Company
may require the Holders to furnish the Company with such information regarding
the Holders and the distribution of such shares as the Company may from time to
time reasonably request in writing in order to comply with the 1933 Act. Each
Holder agrees to notify the Company as promptly as practicable of any inaccuracy
or change in information previously furnished to the Company or of the
occurrence of any event in either case as a result of which any prospectus
relating to such registration contains untrue statements of a material fact
regarding the Holders or the distribution of such shares or omits to state any
material fact regarding the Holders or the distribution of such shares required
to be stated therein or necessary to make the statement therein not misleading
in light of the circumstances under which such statements were made, and to
promptly furnish to the Company any additional information required to correct
and update any previously furnished information or required such that such
prospectus shall not contain, with respect to the Holders or the distribution of
such shares, 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
not misleading in light of the circumstances under which such statements are
made.
SECTION 2.06. SUSPENSION OF OFFERING PENDING PROSPECTUS SUPPLEMENT OR
AMENDMENT. Each Holder agrees that, upon receipt of any notice from the Company
of the occurrence of any event of the kind described in SECTION 2.03(C)(IX)(B),
(C), (D), (E) OR (F) hereof, such Holder will forthwith discontinue disposition
of the Registrable Securities covered by such registration statement or
prospectus until such holder's receipt of the copies of the supplemented or
amended prospectus relating to such registration statement or prospectus, or
until it is advised in writing by the Company that the use of the applicable
prospectus may be resumed, and has received copies of any additional or
supplemental filings which are incorporated by reference in such prospectus,
and, if so directed by the Company, such Holder will deliver to the Company all
copies, other than permanent file copies then in such Holder's possession, of
the prospectus covering the Registrable Securities current at the time of
receipt of such notice.
SECTION 2.07. REGISTRATION EXPENSES. (a) GENERAL. All expenses incident
to the Company's performance and execution of Demand Registrations or Piggyback
Registrations, and the Company's performance of or compliance with this
Agreement, including, without limitation, all registration and filing fees, fees
and expenses of compliance with securities or Blue Sky Laws, expenses and fees
for listing the securities on the appropriate securities exchanges or qualifying
such securities for trading in the appropriate securities markets, costs of
liability insurance, all internal expenses, the expense of any annual audit or
quarterly review, printing expenses, messenger and delivery expenses, fees and
disbursements of counsel for the Company and all independent certified public
accountants (including the expenses of any special audit and "cold comfort"
letters required by or incident to such performance), and fees and costs of
underwriters (excluding discounts and commissions and fees of underwriters,
selling brokers, dealer managers or similar securities industry
-14-
professionals relating to the distribution of the Registrable Securities) and
other Persons (all such expenses being herein called "Registration Expenses"),
shall be borne by the Company.
(b) REIMBURSEMENT FOR COUNSEL FEES. In connection with each
Demand Registration and Piggyback Registration, the Company shall reimburse the
Holders for the reasonable fees and disbursements of one law firm chosen by
Holders of a majority (in then market value) of the then outstanding Registrable
Securities.
(c) PAYMENT OF EXPENSES BY THE HOLDERS. The Holders shall pay the
underwriters' discount and commissions and the commissions and fees, if any,
payable in respect of selling brokers, dealer managers or similar securities
industry professionals, and transfer taxes allocable to the registration of the
Holders' securities so included in any Demand Registration or Piggyback
Registration pursuant to this Agreement.
SECTION 2.08. UNDERWRITTEN OFFERINGS. (a) UNDERWRITING AGREEMENT. In any
underwritten offering by one or more Holders pursuant to a registration
requested under SECTION 2.01(A) OR 2.02(A), the Company shall enter into an
underwriting agreement which shall be reasonably satisfactory in form and
substance to the Company, such Holder or Holders and the underwriters and which
shall contain representations, warranties and agreements (including
indemnification agreements to the effect and consistent with that provided in
SECTION 2.09 hereof) as are customarily included by an issuer in underwriting
agreements with respect to primary distributions.
(b) CONDITION TO PARTICIPATION AND QUALIFICATIONS TO OBLIGATIONS UNDER
REGISTRATION COVENANTS. The obligations of the Company to use its reasonable
best efforts to cause the Registrable Securities to be registered under the 1933
Act are subject to each of the conditions that no Holder may participate in any
underwritten offering hereunder unless such Holder (a) agrees to sell such
Registrable 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 reasonably and customarily required
under the terms of such underwriting arrangements.
SECTION 2.09. INDEMNIFICATION. (a) BY THE COMPANY. In the event of any
registration of any Registrable Securities under the 1933 Act, the Company will,
and does hereby indemnify and hold harmless, to the fullest extent permitted by
law, each Holder, its directors and officers, each other Person who participates
as an underwriter in the offering or sale of such securities and each other
Person, if any, who controls such Holder or any such underwriter within the
meaning of the 1933 Act, against any and all losses, claims, damages,
liabilities and expenses, joint or several, (or actions or proceedings, whether
commenced or threatened, in respect thereof) to which they or any of them may
become subject under the 1933 Act or any other statute or common law, including
any amount paid in settlement of any litigation, commenced or threatened, and to
reimburse them for any legal or other expenses incurred by them in connection
with investigating any claims and defending any actions, insofar as any such
losses, claims, damages, liabilities, expenses or actions arise out of or are
based upon (i) any untrue statement or alleged untrue statement of a material
fact contained
-15-
in the registration statement relating to the sale of such securities or any
post-effective amendment thereto or any related registration statement filed
pursuant to Rule 462 or similar rule under the 1933 Act or in any filing made in
connection with the qualification of the offering under Blue Sky or other
securities laws or jurisdictions in which the Registrable Securities are offered
("Blue Sky Filing"), or the omission or alleged omission to state therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading or (ii) any untrue statement or
alleged untrue statement of a material fact contained in any preliminary
prospectus, if used prior to the effective date of such registration statement
(unless such statement is corrected in the final prospectus and the Company has
previously furnished copies thereof to each Holder and the underwriters), or
contained in the final prospectus (as amended or supplemented if the Company
shall have filed with the Commission, and furnished to each Holder and the
underwriters of such offering copies thereof, prior to the written confirmation
of any sale to the person asserting liability, any amendment thereof or
supplement thereto) if used within the period during which the Company is
required to keep the registration statement to which such prospectus relates
current, or the omission or alleged omission to state therein (if so used) a
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; PROVIDED, HOWEVER,
that the indemnification agreement contained herein shall not (i) apply to such
losses, claims, damages, liabilities, expenses or actions arising out of, or
based upon, any such untrue statement or alleged untrue statement, or any such
omission or alleged omission, if such statement or omission was made in reliance
upon and in conformity with written information furnished to the Company by a
Holder or such underwriter expressly for use in connection with preparation of
the registration statement, any preliminary prospectus or final prospectus
contained in the registration statement, any such amendment or supplement
thereto or any Blue Sky Filing or (ii) inure to the benefit of any underwriter
or any person controlling such underwriter, to the extent that any such loss,
claim, damage, liability (or action or proceeding in respect thereof) or expense
arises out of such person's failure to send or give a copy of the final
prospectus, as the same may be then supplemented or amended, to the person
asserting an untrue statement or alleged untrue statement or omission or alleged
omission at or prior to the written confirmation of the sale of Registrable
Securities to such person if such statement or omission was corrected in such
final prospectus. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Holder or any such
director, officer or controlling person and shall survive the transfer of such
securities by such Holder.
(b) BY THE HOLDERS. The Company may require, as a condition to including
any Registrable Securities in any registration statement filed pursuant to
SECTION 2.01 OR 2.02, that the Company shall have received an undertaking
satisfactory to it from the Holders to indemnify and hold harmless (in the same
manner and to the same extent as set forth in SECTION 2.09(A)) the Company, each
director of the Company, each officer of the Company and each other person, if
any, who controls the Company within the meaning of the 1933 Act, with respect
to any untrue statement or alleged untrue statement in, or omission or alleged
omission from, such registration statement, any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereto, if such
statement or omission was made in reliance upon and in conformity with written
information furnished to the Company by a Holder expressly for use in the
preparation of such
-16-
registration statement, preliminary prospectus, final prospectus, amendment or
supplement. Such indemnity shall remain in full force and effect, regardless of
any investigation made by or on behalf of the Company or any such director,
officer or controlling person and shall survive the transfer of such securities
by such Holder. In no event shall any indemnity paid by any Holder to the
Company pursuant to this SECTION 2.09(B), or otherwise, exceed the proceeds
received by such Holder in such offering.
(c) NOTICES OF CLAIMS, ETC. Promptly after receipt by an indemnified
party of notice of the commencement of any action or proceeding involving a
claim referred to in SECTION 2.09(A) OR 2.09(B), such indemnified party will, if
a claim in respect thereof is to be made against an indemnifying party, give
written notice to the latter of the commencement of such action, PROVIDED that
the failure of any indemnified party to give notice as provided herein shall not
relieve the indemnifying party of its obligations under SECTION 2.09(A) OR
2.09(B), as the case may be. In case any such action is brought against an
indemnified party, the indemnifying party shall be entitled to participate in
and, unless in such indemnified party's reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may exist in respect
of such claim, to assume the defense thereof, jointly with any other
indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof other than reasonable costs of
investigation. In the event that the indemnifying party advises an indemnified
party that it will contest a claim for indemnification hereunder, or fails,
within 30 days of receipt of any indemnification notice to notify, in writing,
such person of its election to defend, settle or compromise, at its sole cost
and expense, any action, proceeding or claim (or discontinues its defense at any
time after it commences such defense), then the indemnified party may, at its
option, defend, settle or otherwise compromise or pay such action or claim. In
any event, unless and until the indemnifying party elects in writing to assume
and does so assume the defense of any such claim, proceeding or action, the
indemnified party's costs and expenses arising out of the defense, settlement or
compromise of any such action, claim or proceeding shall be losses subject to
indemnification hereunder. The indemnified party shall cooperate fully with the
indemnifying party in connection with any negotiation or defense of any such
action or claim by the indemnifying party and shall furnish to the indemnifying
party all information reasonably available to the indemnified party which
relates to such action or claim. The indemnifying party shall keep the
indemnified party fully apprised at all times as to the status of the defense or
any settlement negotiations with respect thereto. If the indemnifying party
elects to defend any such action or claim, then the indemnified party shall be
entitled to participate in such defense with counsel of its choice at its sole
cost and expense. If the indemnifying party does not assume such defense, the
indemnified party shall keep the indemnifying party apprised at all times as to
the status of the defense; PROVIDED, HOWEVER, that the failure to keep the
indemnifying party so informed shall not affect the obligations of the
indemnifying party hereunder. No indemnifying party shall be liable for any
settlement of any action, claim or proceeding effected without its written
consent; PROVIDED, HOWEVER, that the indemnifying party shall not unreasonably
withhold, delay or condition its consent. No
-17-
indemnifying party shall, without the consent of the indemnified party, 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) CONTRIBUTION. If the indemnification provided for in or pursuant to
SECTION 2.09(A) OR 2.09(B) is due in accordance with the terms thereof, but is
held by a court to be unavailable or unenforceable in respect of any losses,
claims, damages, liabilities or expenses 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 person as a
result of such losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party on the one hand and of the indemnified party on the other in connection
with the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses as well as any other relevant equitable considerations.
The relative fault of the indemnifying party 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 indemnifying party or by the indemnified party, by such party's
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement, or omission. In no event shall the liability of any
Holder be greater in amount than the amount of proceeds received by such Holder
upon such sale.
ARTICLE III
EFFECTIVE TIME AND TERM OF THIS AGREEMENT
SECTION 3.01. EFFECTIVE TIME AND TERM OF THIS AGREEMENT. This Agreement
will be effective for all purposes as of the Closing and will continue in full
force and effect until the date that no Holder owns any of the Registrable
Securities.
ARTICLE IV
MISCELLANEOUS
SECTION 4.01. SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.
SECTION 4.02. AMENDMENTS. This Agreement contains the entire
understanding of the parties with respect to the Registrable Securities, and may
be amended only by an agreement in writing signed by (i) the Company and (ii)
the Holders of not less than a majority (in then market value) of the then
outstanding Registrable Securities, including not less than a majority (in then
-18-
market value) of the then outstanding Registrable Securities held by the RIMCO
Holders, PROVIDED, HOWEVER, that in no event shall any amendment impose any
additional material obligations on any Holder without such Holder's written
consent.
SECTION 4.03. DESCRIPTIVE HEADINGS. Descriptive headings are for
convenience only and shall not control or affect the meaning or construction of
any provision of this Agreement.
SECTION 4.04. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall be an original but all of which together
shall constitute one instrument. Each counterpart may consist of a number of
copies hereof, each signed by less than all, but together signed by all, of the
parties hereto.
SECTION 4.05. NOTICES. All notices and communications provided for
hereunder shall be in writing and sent (a) by telecopy if the sender on the same
day sends a confirming copy of such notice by a recognized overnight delivery
service (charges prepaid) or (ii) by registered or certified mail with return
receipt requested (postage prepaid) or (iii) by a recognized overnight delivery
service (with charges prepaid).
(i) if to a RIMCO Holder, at its addresses set forth below, or such
other address as it shall have specified to the Company in writing,
(ii) if to any other Holder, at such address as specified to the Company
in writing in the notice provided in SECTION 4.08(B), or such other
address as such Holder shall have subsequently specified to the Company
in writing, and
(iii) if to the Company or the Company, 0000 Xxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxx 00000, Telecopy No.: 713-652-9601, or such other address
as it shall have specified to the Holders in writing.
Notices given under this SECTION 4.05 shall be deemed given only when actually
received.
SECTION 4.06. GOVERNING LAW. This Agreement shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the laws of the State of New York, excluding choice-of-law principles of the law
of such State that would require the application of the laws of a jurisdiction
other than such State.
SECTION 4.07. SURVIVAL. The representations and warranties made by the
Company herein shall survive the execution and delivery of the Transaction
Documents and the purchase and transfer by the Holders of any of the Registrable
Securities, regardless of any investigation made at any time by or on behalf of
the RIMCO Holders or any other Holder. All statements contained in any
certificate or other instrument delivered by or on behalf of the Company
pursuant to this Agreement shall be deemed to be representations and warranties
of the Company under this Agreement.
-19-
SECTION 4.08. SUCCESSORS AND ASSIGNS. (a) Subject to the provisions of
SECTION 4.08(B), all covenants and other agreements contained in this Agreement
by or on behalf of any of the parties hereto bind and inure to the benefit of
their respective successors and assigns (including, without limitation, any
subsequent holder of a Note or any Registrable Securities), whether so expressed
or not.
(b) The Registrable Securities and rights of any Holder under this
Agreement with respect to any Registrable Securities may be assigned to any
person who acquires Registrable Securities from a Holder, except that any Person
who acquires such Registrable Securities (x) pursuant to a public offering
registered under the 1933 Act or (y) pursuant to a transfer made in accordance
with Rule 144 under the 1933 Act may not be assigned rights hereunder with
respect to such Registrable Securities. Notwithstanding the foregoing, rights to
cause a Demand Registration under SECTION 2.01(A) may only be assigned if such
rights are expressly assigned in writing from a Holder. Any assignment of
registration rights pursuant to this SECTION 4.08(B) shall be effective upon
receipt by the Company of written notice from such assigning Holder (i) stating
the name and address of any assignee, (ii) describing the manner in which the
assignee acquired the Registrable Securities from such Holder and (iii)
identifying the number of Registrable Securities with respect to which the
rights under this Agreement are being assigned.
SECTION 4.09. ACTIONS BY HOLDERS OF MAJORITY OF REGISTRABLE SECURITIES.
Each of the parties hereto agrees, in connection with the taking of any action
permitted to be taken hereunder by the Holders or RIMCO Holders (as the case may
be), that the Holders or RIMCO Holders (as the case may be) holding a majority
(in then market value) of the then outstanding Registrable Securities are
entitled to take such action.
SECTION 4.10. EXISTING REGISTRATION RIGHTS. The Company and the RIMCO
Holders each acknowledge and agree that the Company has (i) either granted or is
otherwise bound by certain agreements granting demand and piggyback registration
rights to the Existing Rights Holders, and (ii) pursuant to the Merger
Agreement, agreed to prepare and file with the Commission a registration
statement covering certain shares of Common Stock held by the holders identified
therein. The Company and the RIMCO Holders each agree to undertake their
reasonable, good faith efforts to enter into an agreement with all of the
Company's shareholders who hold registration rights whereby such registration
rights are coordinated such that in the event of a registration of shares by the
Company that triggers "piggyback" rights among such shareholders, such
shareholders will have the rights to register their shares on a pro rata basis
if the total number of shares to be registered is cut back by the managing
underwriter; provided, however, that in the case of a "demand" registration by a
shareholder of the Company, the shareholder demanding registration will have
priority to register all of its shares before any shares are registered pursuant
to the "piggyback" rights of other shareholders (with such "piggyback" shares to
be registered on a pro rata basis in the event of an underwriter cutback).
-20-
IN WITNESS WHEREOF, the Company, Texoil Company and the RIMCO Holders
have caused this Agreement to be executed by their respective representatives
thereunto duly authorized, effective as of the date first above written.
TEXOIL, INC.
By: /s/ XXXXX XXXXXXX
Xxxxx Xxxxxxx
President
TEXOIL COMPANY
By: /s/ XXXXX XXXXXXX
Xxxxx Xxxxxxx
President
RIMCO PARTNERS, L.P.
RIMCO PARTNERS, X.X. XX
RIMCO PARTNERS, L.P. III
RIMCO PARTNERS, L.P. III
By: RESOURCES INVESTORS MANAGEMENT
COMPANY LIMITED PARTNERSHIP,
their general partner
By: RIMCO ASSOCIATES, INC.,
its general partner
By: /s/ X. X. XXXXXX
X. X. Xxxxxx
Vice President
Addresses for Notices:
00 Xxxxxxxxxx Xxxx
Xxxx, Xxxxxxxxxxx 00000
Telecopy No.: 000-000-0000
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telecopy No.: 000-000-0000
SCHEDULE 1.07
EXISTING RIGHTS HOLDERS
1. First Union Capital Partners, Inc. - Common Stock and Warrant Purchase
Agreement between Cliffwood Oil & Gas Corp. and First Union Partners,
Inc., dated May 30, 1997.
2. Belleview 1992 Income Fund, L.P. - Common Stock and Warrant Purchase
Agreement between Cliffwood Oil & Gas Corp. and Belleview 1992 Income
Fund, L.P., dated August 4, 1997.
3. Energy Capital Investment Company, PLC. and EnCap Equity 1996 Limited
Partnership - Investment Agreement by and between Cliffwood Oil & Gas
Corp., Energy Capital Investment Company, PLC. and EnCap Equity 1996
Limited Partnership, dated September 27, 1996.
4. The following individual persons who have registration rights under that
certain Stock Ownership and Registration Rights Agreement dated
September 6, 1996 among such persons and the Company:
X. X. Xxxxx, Xx.
X. X. Xxxxx, III
Xxxxxxx X. Xxxxxx
5. Holders of the following warrants issued pursuant to the underwritten
public offering of 750,000 units in May 1994:
Class A Warrants
Class B Warrants
Schedule 1.07
