EXHIBIT 10.2
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT ("Agreement"), dated as of June 19,
2003, is executed and delivered by and between Delta Petroleum Corporation, a
Colorado corporation (the "Company"), and JAED Production Company, Inc., a
Kansas corporation ("JAED").
W I T N E S S E T H:
WHEREAS, pursuant to the terms of that certain Purchase and Sale
Agreement dated June 5, 2003 between JAED as "Seller" and the Company as
"Buyer" (the "Purchase and Sale Agreement"), JAED will acquire 200,000 shares
of the Company's Common Stock (the "Registrable Securities"); and
WHEREAS, the Registrable Securities are being issued and delivered by the
Company in reliance upon the exemption from the registration provisions of the
United States Securities Act of 1933, as amended (the "Securities Act"), for
non-public offerings pursuant to Sections 4(2) and 4(6) of the Securities Act
and Regulation D under the Securities Act; and
WHEREAS, the terms and conditions of the Purchase and Sale Agreement
provide for the execution and delivery of this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereby agree as
follows:
1. Definitions. As used in this Agreement, the capitalized terms set forth
below shall have the following meanings:
"Affiliate" shall mean, as to a specified Person, a Person that
directly, or indirectly through one or more intermediaries, controls or
is controlled by, or is under common control with, the Persons
specified.
"Company" shall have the meaning set forth in the preamble, and shall
also include the Company's successors.
"Exchange Act" shall mean the United States Securities Exchange Act of
1934, as amended.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"Persons" shall mean any individual, sole proprietorship, partnership,
corporation, association, limited liability company, joint venture,
trust, unincorporated entity or other entity, or the government of any
country or sovereign state, or of any state, province, municipality or
other political subdivision thereof.
"Prospectus" shall mean the Prospectus included in any Registration
Statement including any preliminary Prospectus, and any such Prospectus
as amended or supplemented by any Prospectus supplement, including
post-effective amendments, in each case including all material
incorporated or deemed to be incorporated by reference therein.
"Registrable Securities" shall have the meaning set forth in the
preamble; provided, however, that any shares of Common Stock shall cease
to be Registrable Securities when they shall have been included in an
effective Registration Statement or sold pursuant to Rule 144.
"Registration Expenses" shall mean any and all expenses incident to the
performance by the Company of its obligations under this Agreement,
including, but not limited to: (i) all SEC and NASD registration and
filing fees; (ii) all fees and expenses incurred in connection with
compliance with state securities or blue sky laws; (iii) all expenses of
printing and distributing any Registration Statement, any Prospectus,
and any amendments or supplement thereto; and (iv) the fees and
disbursements of counsel for the Company and of the independent public
accountants of the Company.
"Registration Statement" means any registration statement of the
Company, which covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including a Prospectus, amendments and
supplements to such registration statement, including post-effective
amendments, all exhibits and all material incorporated by reference or
deemed to be incorporated by reference in such registration statement.
"Rule 144" means Rule 144 of the General Rules and Regulations
promulgated under the Securities Act or any successor rule.
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities Act" shall have the meaning set forth in the preamble.
"Underwriter" shall have the meaning set forth in Section 2(11) of the
Securities Act who signs an underwriting agreement with the Company for
an underwritten offering of any of the Company's equity securities.
2. Registration.
(a) The Company agrees that within thirty (30) days following the date
of Closing of the Purchase and Sale Agreement, the Company shall
file a registration statement, and shall use commercially
reasonably efforts to cause such Registration Statement to become
effective with respect to such Registrable Securities in
accordance with the registration procedure set forth in Section 4
hereof.
(b) In the event that the registration is pursuant to a
"firm-commitment" underwriting, JAED shall (together with the
Company and any other holders of Common Stock distributing their
securities through such underwriting) enter into an underwriting
agreement in customary form with underwriter or underwriters
selected for underwriting by the Company.
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3. Holdback Agreements. If any of JAED's Registrable Securities are covered
by a Registration Statement filed pursuant to this Agreement, if
requested of all holders of registrable shares of the Common Stock of
the Company covered by such Registration Statement by the managing
underwriters in an underwritten offering (if timely notified in writing
by the Company or the managing underwriters), JAED agrees not to effect
any public sale or distribution of securities of the Company of any
class included in such Registration Statement, including a sale pursuant
to Rule 144 (except as a part of such underwritten offering) to the same
extent as has been requested by such other holders, during the 10-day
period prior to, and the 180-day period beginning on, the effective date
of any underwritten offering made pursuant to such Registration
Statement.
4. Expenses and Procedures. This Section 4 shall be applicable to a
registration of Registrable Securities pursuant to this Agreement.
(a) Expenses of Registration. All Registration Expenses (exclusive of
underwriting discounts and commissions) shall be borne by the
Company. JAED shall bear all underwriting discounts, selling
commissions, sales concessions and similar expenses applicable to
any sale of the Registrable Securities sold by JAED.
(b) Registration Procedures. In the case of the registration,
qualification or compliance effected by the Company pursuant to
this Agreement, the Company will keep JAED advised as to the
initiation of registration, qualification and compliance and as to
the completion thereof. At its expense, the Company will furnish
such number of Prospectuses and other documents incident thereto
as JAED or underwriters from time to time may reasonably request.
(c) Information. The Company may require each seller of Registrable
Securities as to which any registration is being effected to
furnish such information regarding the distribution of such
Registrable Securities as the Company may from time to time
reasonably request.
(d) Delay or Suspension. Notwithstanding anything herein to the
contrary, the Company may, at any time, suspend the effectiveness
of any Registration Statement for a period of up to 30 consecutive
days or 60 days in the aggregate in any calendar year, as
appropriate (a "Suspension Period"), by giving notice to JAED to
be included in the Registration Statement, if the Company shall
have determined, after consultation with its counsel, that the
Company is required to disclose any material corporate development
which the Company determines could reasonably be expected to have
a material effect on the Company. JAED agrees by acquisition of
such Registrable Securities that, upon receipt of any notice from
the Company of a Suspension Period, JAED shall forthwith
discontinue disposition of such Registrable Securities covered by
such Registration Statement or Prospectus until JAED (i) is
advised in writing by the Company that the use of the applicable
Prospectus may be resumed, (ii) has received copies of a
supplemental or amended prospectus, if applicable, and (iii) has
received copies of any additional or supplemental filings which
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are incorporated or deemed to be incorporated by reference in such
Prospectus. The Company shall prepare, file and furnish to JAED
immediately upon the expiration of any Suspension Period,
appropriate supplements or amendments, if applicable, to the
Prospectus and appropriate documents, if applicable, incorporated
by reference in the Registration Statement. The Company agrees to
use its best efforts to cause any Suspension Period to be
terminated as promptly as possible.
(e) Blue Sky. The Company will, as expeditiously as possible, use its
best efforts to register or qualify the Registrable Securities
covered by a Registration Statement under the securities or blue
sky laws of such jurisdictions as JAED or, in the case of an
underwritten public offering, the managing underwriter shall
reasonably request, provided that the Company shall not be
required in connection therewith or as a condition thereto to
qualify to do business in any jurisdiction where it is not so
qualified or to take any action which would subject it to taxation
or service of process in any jurisdiction where it is not
otherwise subject to such taxation or service of process.
(f) Notification of Material Events. The Company will, as
expeditiously as possible, immediately notify JAED, at any time
when a prospectus relating thereto is required to be delivered
under the Securities Act, of the happening of any event as a
result of which the prospectus contained in such Registration
Statement, as then in effect, includes an untrue statement of a
material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing and, as
expeditiously as possible, amend or supplement such prospectus to
eliminate the untrue statement or the omission.
(g) Opinions. The Company will use its best efforts (if the offering
is underwritten) to furnish, at the request of JAED, on the date
that Registrable Securities are delivered to the underwriters for
sale pursuant to such registration: (i) an opinion dated such date
of counsel representing the Company for the purposes of such
registration, addressed to the Underwriter(s), stating that such
Registration Statement has become effective under the Securities
Act and that (A) to the best knowledge of such counsel, no stop
order suspending the effectiveness thereof has been issued and no
proceedings for that purpose have been instituted or are pending
or contemplated under the Securities Act, (B) the Registration
Statement, the related prospectus, and each amendment or
supplement thereof, comply as to form in all material respects
with the requirements of the Securities Act (except that such
counsel need express no opinion as to financial statements and
financial and statistical data contained therein) and (C) to such
other effects as may reasonably be requested by counsel for the
Underwriter(s), and (ii) a letter dated such date from the
independent public accountants retained by the Company, addressed
to the Underwriter(s), stating that they are independent public
accountants within the meaning of the Securities Act and that, in
the opinion of such accountants, the financial statements of the
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Company included in the Registration Statement or the Prospectus,
or any amendment or supplement thereof, comply as to form in all
material respects with the applicable accounting requirements of
the Securities Act, and such letter shall additionally cover such
other financial matters (including information as to the period
ending no more than five business days prior to the date of such
letter) with respect to the registration in respect of which such
letter is being given as such underwriters or JAED may reasonably
request.
5. Certification by Selling Shareholders. JAED shall review the
Registration Statement prepared and filed in connection with any such
registration and shall represent and warrant to the Underwriter, if any,
and the Company that JAED does not know of an untrue statement of a
material fact concerning JAED included in the Registration Statement or
the omission from the Registration Statement of any material fact
concerning JAED required to be stated therein or necessary to make the
statements therein not misleading.
6. Indemnification and Contribution.
(a) In connection with any Registration Statement, the Company agrees
to indemnify and hold harmless JAED, each Affiliate of JAED, the
directors, partners, officers, employees and agents of JAED and
each person who controls JAED, if any, within the meaning of
either the Securities Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the Act, the Exchange
Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement as
originally filed or in any amendment thereof, or in any
preliminary Prospectus or Prospectus, or in any amendment thereof
or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action;
provided, however, that (i) the Company will not be liable in any
case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or
alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of JAED
specifically for inclusion therein, (ii) the Company will not be
liable to any indemnified party under this indemnity agreement
with respect to any Registration Statement or Prospectus to the
extent that any such loss, claim, damage or liability of such
indemnified party results from the use of the Prospectus during a
period when the use of the Prospectus has been suspended in
accordance with Section 4(d) hereof, provided that the indemnified
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party received prior notice of such suspension, which notice shall
be deemed to have been received by the indemnified party within 48
hours after the giving thereof; and (iii) the Company shall not be
liable to any indemnified party with respect to any preliminary
Prospectus to the extent that any such loss, claim, damage or
liability of such indemnified party results from the fact that
such indemnified party sold Registrable Securities to a person as
to whom there was not sent or given, at or prior to the written
confirmation of such sale, a copy of the Prospectus or of the
Prospectus as then amended or supplemented in any case where such
delivery is required by the Securities Act, if the loss, claim,
damage or liability of such indemnified party results from an
untrue statement or omission of a material fact contained in the
preliminary Prospectus which was corrected in the Prospectus or in
the Prospectus as then amended or supplemented. This indemnity
agreement will be in addition to any liability which the Company
may otherwise have. The Company also agrees to indemnify and
provide contribution to each person who is an Underwriter and who
signs an underwriting agreement and/or a selected-dealer agreement
with respect to the Registrable Securities, their officers and
directors, and each person who controls each such Underwriter, on
substantially the same basis as that of the indemnification of and
contribution to JAED provided in this Section 6(a).
(b) By its participation in a Registration Statement, JAED shall be
deemed to have agreed to indemnify and hold harmless (i) the
Company, (ii) each of its directors, (iii) each of its officers
who signs such Registration Statement and (iv) each person who
controls the Company within the meaning of either the Act or the
Exchange Act to the same extent as the foregoing indemnity from
the Company to JAED and its affiliates, but only with respect to
written information relating to JAED furnished to the Company by
or on behalf of JAED specifically for inclusion in the documents
referred to in the foregoing indemnity. JAED shall also be deemed
to have agreed to indemnify and contribute to each Underwriter who
signs an underwriting agreement and/or a selected-dealer agreement
in connection with such Registration Statement, their officers and
directors, and each person who controls each such Underwriter, on
substantially the same basis as that of the indemnification of and
contribution to the Company provided in this Section 6(b).
Anything in this Agreement contained to the contrary
notwithstanding, the liability of JAED for indemnification or
contribution hereunder shall be limited to the amount of proceeds
received by JAED in the offering giving rise to such liability.
(c) Promptly after receipt by an indemnified party under this Section
6 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against
the indemnifying party under this Section 6, notify the
indemnifying party in writing of the commencement thereof; but the
failure so to promptly notify the indemnifying party will not
relieve the indemnifying party from liability under Section 6(a)
or 6(b) hereof unless and to the extent that it is materially
prejudiced thereby. The indemnifying party shall be entitled to
appoint counsel of the indemnifying party's choice at the
indemnifying party's expense to represent the indemnified party in
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any action for which indemnification is sought (in which case the
indemnifying party shall not thereafter be responsible for the
fees and expenses of any separate counsel retained by the
indemnified party or parties except as set forth below): provided,
however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party's
election to appoint counsel to represent the indemnified party in
an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying
party shall bear the reasonable fees, costs and expenses of such
separate counsel (and local counsel) if (i) the use of counsel
chosen by the indemnifying party to represent the indemnified
party would present such counsel with a conflict of interest, (ii)
the actual or potential defendants in, or targets of, any such
action included both the indemnified party and the indemnifying
party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to
those available to the indemnifying party, (iii) the indemnifying
party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a
reasonable time after notice of the institution or such action or
(iv) the indemnifying party shall authorize the indemnified party
to employ separate counsel at the expense of the indemnifying
party. An indemnified party shall not settle or compromise any
action for which it seeks indemnification or contribution
hereunder without the prior written consent of the indemnifying
party, which consent shall not be unreasonably withheld. An
indemnifying party will not, without the prior written consent of
the indemnified parties, settle or compromise or consent to the
entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether
or not the indemnified parties or actual or potential parties to
such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit
or proceeding.
(d) The provisions of this Section 6 shall remain in full force and
effect regardless of any investigation made by or on behalf of
JAED or the Company or any other persons who are entitled to
indemnification pursuant to the provisions of this Section 6, and
shall survive the sale by JAED of Registrable Securities.
7. Rule 144. As long as the Company is subject to the reporting
requirements of Section 13 or 15 of the Exchange Act, the Company shall
use commercially reasonable efforts to promptly file the reports
required to be filed by it pursuant to Section 13(a) or 15(d) of the
Exchange Act and the rules and regulations adopted by the SEC
thereunder. If the Company is at any time not required to file such
reports, it shall promptly make publicly available such information as
is necessary to permit sales pursuant to Rule 144. Upon the request of
JAED, the Company shall deliver to JAED a written statement as to
whether it has complied with such requirements.
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8. Amendments. This Agreement may not be amended, modified or
supplemented, and waivers of or consents to departures from the
provisions of this Agreement may not be given, unless they would not
have an adverse effect upon the rights of JAED and the Company has
obtained the consent of JAED.
9. Successors and Assigns. This Agreement shall inure to the benefit of,
and be binding upon, the Company, JAED and their respective successors,
assigns and transferees.
10. Third Party Beneficiaries. JAED from time to time shall be a third
party beneficiary of the agreements of the Company contained herein.
11. Headings. The headings which are contained in this Agreement are for
the sole purpose of convenience of reference, and shall not limit or
otherwise affect the interpretation of any of the provisions hereof.
12. Governing Law. This Agreement shall be governed by the laws of the
State of Colorado applicable to contracts made and to be wholly
performed therein.
13. Notices. All notices and other communications hereunder shall be in
writing, and shall be made by hand delivery, registered first-class
mail, telecopier or any courier providing overnight delivery, at the
addresses set forth for notices in the Purchase and Sale Agreement. All
such notices and other communications shall be deemed to have been duly
given upon receipt.
14. Entire Agreement. This Agreement sets forth the entire agreement among
the parties with respect to the subject matter hereof.
15. Severability. In the event that any one or more of the provisions of
this Agreement, or the application thereof in any circumstances, is held
invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every
other respect and of the remaining provisions of this Agreement shall
not be in any way impaired or affected thereby.
16. Interpretation. As used in this Agreement, unless the context otherwise
requires: words describing the singular number shall include the plural
and vice versa; words denoting any gender shall include all genders;
words denoting natural persons shall include corporations, partnerships
and other entities, and vice versa; and the words "hereof," "herein,"
and "hereunder," and words of similar import, shall refer to this
Agreement as a whole, and not to any particular provision of this
Agreement.
17. Waiver. The failure of the Company or JAED to at any time enforce any
of the provisions of this Agreement shall not be deemed or construed to
be a waiver of any such provision, nor to in any way affect the validity
of this Agreement or any provision hereof or the right of the Company or
JAED to thereafter enforce each and every provision of this Agreement.
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IN WITNESS WHEREOF, the undersigned have duly executed and delivered this
Agreement as of the date above written.
"Company"
DELTA PETROLEUM CORPORATION
By /s/ Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxx
President
"JAED"
JAED PRODUCTION COMPANY, INC.
By /s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
President
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