Registration Rights Agreement Dated as of October 23, 2009 between ION Geophysical Corporation and BGP Inc., China national Petroleum Corporation
EXHIBIT 10.54
Dated as of October 23, 2009
between
ION Geophysical Corporation
and
BGP Inc., China national Petroleum Corporation
TABLE OF CONTENTS
| Page | ||||
Section 1. Certain Definitions |
1 | |||
Section 2. Demand Registration |
4 | |||
Section 3. Piggyback Registrations |
5 | |||
Section 4. S-3 Shelf Registration |
6 | |||
Section 5. Suspension Periods |
7 | |||
Section 6. Holdback Agreements |
8 | |||
Section 7. Registration Procedures |
8 | |||
Section 8. Registration Expenses |
11 | |||
Section 9. Indemnification |
12 | |||
Section 10. Securities Act Restrictions |
13 | |||
Section 11. Transfers of Rights |
13 | |||
Section 12. Miscellaneous |
14 | |||
-i-
This Registration Rights Agreement (this “Agreement”), is made and entered
into as of October 23, 2009, by and between ION Geophysical Corporation., a corporation organized
under the laws of the State of Delaware (the “Company”), and BGP Inc., China National
Petroleum Corporation, a company organized under the People’s Republic of China (the
“Investor”).
WHEREAS, the Company and the Investor are parties to a Warrant Issuance Agreement, dated
October 23, 2009 (the “Warrant Issuance Agreement”) pursuant to which the Investor is
issued a warrant (the “Warrant”) to purchase a certain number of shares of the Company’s
common stock, par value $0.01 per share (the “Common Stock”);
WHEREAS, pursuant to certain arrangements between the Investor and Bank of China, New York
Branch (the “New Lender”), the Investor may receive a certain number of shares of the
Common Stock resulting from the conversion of certain indebtedness of the Company held by the New
Lender; and
WHEREAS, in connection with the consummation of the transactions contemplated in connection
with the Warrant Issuance Agreement and the provision of financing by the New Lender to the Company
through certain arrangements made by the Investor (the “Bridge Funding”), the parties
desire to enter into this Agreement in order to create certain registration rights for the Investor
as set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and
other good and valid consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties to this Agreement hereby agree as follows:
Section 1. Certain Definitions.
In addition to the terms defined elsewhere in this Agreement, the following terms shall have
the following meanings:
“Affiliate” of any Person means any other Person which directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under common control with, such
Person. The term “control” (including the terms “controlling,” “controlled” and “under common
control with”) as used with respect to any Person means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.
“Agreement” means this Registration Rights Agreement, including all amendments,
modifications and supplements and any exhibits or schedules to any of the foregoing, and shall
refer to this Registration Rights Agreement as the same may be in effect at the time such reference
becomes operative.
“beneficially own” means, with respect to any Person, securities of which such Person
or any of such Person’s Affiliates, directly or indirectly, has “beneficial ownership” as
determined pursuant to Rule 13d-3 and Rule 13d-5 of the Exchange Act, including securities
beneficially owned by others with whom such Person or any of its Affiliates has agreed to act
together for the purpose of acquiring, holding, voting or disposing of such securities; provided
that a Person shall not be deemed to “beneficially own” (i) securities tendered pursuant to a
tender or exchange offer made by such Person or any of such Person’s Affiliates until such tendered
securities are accepted for payment, purchase or exchange, (ii) any security as a result of an oral
or written agreement, arrangement or understanding to vote such security if such agreement,
arrangement or understanding: (a) arises solely from a revocable proxy given in response to a
public proxy or consent solicitation made pursuant to, and in accordance with, the applicable
provisions of the Exchange Act, and (b) is not also then reportable by such Person on Schedule 13D
under the Exchange Act (or any comparable or successor report). Without limiting the foregoing, a
Person shall be deemed to be the beneficial owner of all Registrable Shares owned of record by any
majority-owned subsidiary of such Person.
“Bridge Funding” has the meaning set forth in the second Recital hereto.
“Common Stock” has the meaning set forth in the first Recital hereto.
“Company” has the meaning set forth in the introductory paragraph.
“Demand Registration” has the meaning set forth in Section 2(a).
“Demand Registration Statement” has the meaning set forth in Section 2(a).
“Exchange Act” means the Securities Exchange Act of 1934.
“Exercise Shares” means Shares acquired by the Investor upon (i) the exercise of the
Warrant or (i) the conversion of any outstanding amount under the Bridge Funding into Shares.
“Form S-3” means a registration statement on Form S-3 under the Securities Act or such
successor forms thereto permitting registration of securities under the Securities Act.
“Governmental Entity” means any national, federal, state, municipal, local,
territorial, foreign or other government or any department, commission, board, bureau, agency,
regulatory authority or instrumentality thereof, or any court, judicial, administrative or arbitral
body or public or private tribunal.
“Holdback Agreement” has the meaning set forth in Section 6.
“Holdback Period” has the meaning set forth in Section 6.
“Investor” means the Person named as such in the first paragraph of this Agreement.
References herein to the Investor shall apply to Permitted Transferees who become Investors
pursuant to Section 11, provided that for purposes of all thresholds and limitations herein, the
actions of the Permitted Transferees shall be aggregated.
“Minimum Amount” means US$8,000,000.
“Person” means any individual, sole proprietorship, partnership, limited liability
company, joint venture, trust, incorporated organization, association, corporation, institution,
public benefit corporation, Governmental Entity or any other entity.
“Permitted Transferee” means any direct or indirect subsidiary of the Investor where
the Investor beneficially owns at least 80% of the equity interests (measured by both voting rights
and value) of such subsidiary.
“Piggyback Registration” has the meaning set forth in Section 3(a).
“Prospectus” means the prospectus or prospectuses (whether preliminary or final)
included in any Registration Statement and relating to Registrable Shares, as amended or
supplemented and including all material incorporated by reference in such prospectus or
prospectuses.
“Registrable Shares” means, at any time, (i) the Exercise Shares, and (ii) any
securities issued by the Company after the date hereof in respect of the Exercise Shares by way of
a share dividend or share split or in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization, but excluding (iii) any and all Exercise Shares and
other securities referred to in clauses (i) and (ii) that at any time after the date hereof (a)
have been sold pursuant to an effective registration statement or Rule 144 under the Securities
Act, (b) have been sold in a transaction where a subsequent public distribution of such securities
would not require registration under the Securities Act, (c) are eligible for sale pursuant to Rule
144 under the Securities Act without limitation thereunder on volume or manner of sale, (d) are not
outstanding or (e) have been transferred to a Person that does not become an Investor pursuant to
Section 11 hereof (or any combination of clauses (a), (b), (c), (d) and (e)). It is understood and
agreed that, once a security of the kind described in clause (i) or (ii) above becomes a security
of the kind described in clause (iii) above, such security shall cease to be a Registrable Share
for all purposes of this Agreement and the Company’s obligations regarding Registrable Shares
hereunder shall cease to apply with respect to such security.
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“Registration Expenses” has the meaning set forth in Section 8(a).
“Registration Statement” means any registration statement of the Company which covers
any of the Registrable Shares pursuant to the provisions of this Agreement, including the
Prospectus, amendments and supplements to such Registration Statement, including post-effective
amendments, all exhibits and all documents incorporated by reference in such Registration
Statement.
“S-3 Shelf Registration” has the meaning set forth in Section 4(a).
“S-3 Shelf Registration Statement” has the meaning set forth in Section 4(a).
“SEC” means the Securities and Exchange Commission or any successor agency.
“Securities Act” means the Securities Act of 1933.
“Shares” means any shares of the Common Stock. If at any time Registrable Shares
include securities of the Company other than Common Stock, then, when referring to Shares other
than Registrable Shares, “Shares” shall include the class or classes of such other securities of
the Company.
“Shelf Takedown” has the meaning set forth in Section 4(b).
“Suspension Period” has the meaning set forth in Section 5.
“Termination Date” means the first date on which there are no Registrable Shares or
there is no Investor.
“Third Party Holdback Period” means any Holdback Period imposed on the Investor
pursuant to Section 6 in respect of an underwritten offering of Shares in which (i) the Investor
elected not to participate or (ii) the Investor’s participation was reduced or eliminated pursuant
to Section 3(b) or 3(c).
“underwritten offering” means a registered offering in which securities of the Company
are sold to one or more underwriters on a firm-commitment basis for reoffering to the public, and
“underwritten Shelf Takedown” means an underwritten offering effected pursuant to an S-3
Shelf Registration.
“Warrant” has the meaning set forth in the first Recital hereto.
In addition to the above definitions, unless the context requires otherwise:
(i) any reference to any statute, regulation, rule or form as of any time shall
mean such statute, regulation, rule or form as amended or modified and shall also
include any successor statute, regulation, rule or form from time to time;
(ii) “including” shall be construed as inclusive without limitation, in each
case notwithstanding the absence of any express statement to such effect, or the
presence of such express statement in some contexts and not in others;
(iii) references to “Section” are references to Sections of this Agreement;
(iv) words such as “herein”, “hereof”, “hereinafter” and “hereby” when used in
this Agreement refer to this Agreement as a whole;
(v) references to “business day” mean any day except Saturday, Sunday and any
day which shall be a legal holiday or a day on which banking institutions in the
State of New York generally are authorized or required by law or other governmental
action to close; and
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(vi) references to “dollars” and “$” mean U.S. dollars.
“Warrant Issuance Agreement” has the meaning set forth in the first Recital hereto.
Section 2. Demand Registration.
(a) Right to Request Registration. Subject to the provisions hereof, until the
Termination Date, the Investor may at any time request registration for resale under the Securities
Act of all or part of the Registrable Shares separate from an S-3 Shelf Registration (a “Demand
Registration”); provided that (based on the then-current market prices) the number of
Registrable Shares included in the Demand Registration would, if fully sold, yield gross proceeds
to the Investor of at least the Minimum Amount. Subject to Section 2(d) and Sections 5 and 7
below, the Company shall (i) file a Registration Statement registering for resale such number of
Registrable Shares as requested to be so registered pursuant to this Section 2(a) (a “Demand
Registration Statement”) within twenty (20) business days after the Investor’s request therefor
and (ii) if necessary, use best efforts to cause such Demand Registration Statement to be declared
effective by the SEC as soon as practicable thereafter and in any event within sixty (60) calendar
days of the Investor’s request for Demand Registration. If permitted under the Securities Act,
such Registration Statement shall be one that is automatically effective upon filing.
(b) Number of Demand Registrations. Subject to the limitations of Sections 2(a), 2(d)
and 4(a), the Investor shall be entitled to request up to three (3) Demand Registrations in the
aggregate under this Agreement (regardless of the number of Permitted Transferees who may become an
Investor pursuant to Section 11). A Registration Statement shall not count as a permitted Demand
Registration unless and until it has become effective.
(c) Priority on Demand Registrations. The Company may include Shares other than
Registrable Shares in a Demand Registration for any accounts (including for the account of the
Company) on the terms provided below; and if such Demand Registration is an underwritten offering,
such Shares may be included only with the consent of the managing underwriters of such offering.
If the managing underwriters of the requested Demand Registration advise the Company and the
Investor requesting such Demand Registration that in their opinion the number of Shares proposed to
be included in the Demand Registration exceeds the number of Shares which can be sold in such
underwritten offering without materially delaying or jeopardizing the success of the offering
(including the price per share of the Shares proposed to be sold in such underwritten offering),
the Company shall include in such Demand Registration (i) first, the number of Registrable Shares
that the Investor proposes to sell, and (ii) second, the number of Shares proposed to be included
therein by any other Persons (including Shares to be sold for the account of the Company) allocated
among such Persons in such manner as the Company may determine. If the number of Shares which can
be sold is less than the number of Shares proposed to be registered pursuant to clause (i) above by
the Investor, the amount of Shares to be sold shall be allocated to the Investor.
(d) Restrictions on Demand Registrations. The Investor shall not be entitled to
request a Demand Registration (i) within three months after the Investor has sold Shares in a
Demand Registration or an underwritten Shelf Takedown requested pursuant to Section 4(b) or (ii) at
any time when the Company is diligently pursuing a primary or secondary underwritten offering
pursuant to a Piggyback Registration. Notwithstanding the foregoing, the Company shall not be
obligated to proceed with a Demand Registration if the offering to be effected pursuant to such
registration can be effected pursuant to an S-3 Shelf Registration and the Company, in accordance
with Section 4, effects or has effected an S-3 Shelf Registration pursuant to which such offering
can be effected.
(e) Underwritten Offerings. The Investor shall be entitled to request an underwritten
offering pursuant to a Demand Registration, but only if the number of Registrable Shares to be sold
in the offering would reasonably be expected to yield gross proceeds to the Investor of at least
the Minimum Amount (based on then-current market prices) and only if the request is not made within
three months after the Investor has sold Shares in an underwritten offering pursuant to (i) a
Demand Registration or (ii) an S-3 Shelf Registration. If any of the Registrable Shares covered by
a Demand Registration are to be sold in an underwritten offering, the Company shall have the right
to select the managing underwriter or underwriters to lead the offering.
(f) Effective Period of Demand Registrations. Upon the date of effectiveness of any
Demand Registration for an underwritten offering and if such offering is priced promptly on or
after such date, the Company
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shall use reasonable best efforts to keep such Demand Registration Statement effective for a
period equal to sixty (60) days from such date or such shorter period which shall terminate when
all of the Registrable Shares covered by such Demand Registration have been sold by the Investor.
If the Company shall withdraw any Demand Registration pursuant to Section 5 before such sixty (60)
days end and before all of the Registrable Shares covered by such Demand Registration have been
sold pursuant thereto, the Investor shall be entitled to a replacement Demand Registration which
shall be subject to all of the provisions of this Agreement. A Demand Registration shall not count
against the limit on the number of such registrations set forth in Section 2(b) if (i) after the
applicable Registration Statement has become effective, such Registration Statement or the related
offer, sale or distribution of Registrable Shares thereunder becomes the subject of any stop order,
injunction or other order or restriction imposed by the SEC or any other governmental agency or
court for any reason not attributable to the Investor or its Affiliates (other than the Company and
its controlled Affiliates) and such interference is not thereafter eliminated so as to permit the
completion of the contemplated distribution of Registrable Shares or (ii) in the case of an
underwritten offering, the conditions specified in the related underwriting agreement, if any, are
not satisfied or waived for any reason not attributable to the Investor or its Affiliates (other
than the Company and its controlled Affiliates), and as a result of any such circumstances
described in clause (i) or (ii), less than 75% of the Registrable Shares covered by the
Registration Statement are sold by the Investor pursuant to such Registration Statement.
Section 3. Piggyback Registrations.
(a) Right to Piggyback.
Whenever prior to the Termination Date the Company proposes to register any Shares under the
Securities Act (other than on a registration statement on Form X-0, X-0, X-0 or F-4), whether for
its own account or for the account of one or more holders of Shares (other than the Investor), and
the form of registration statement to be used may be used for any registration of Registrable
Shares (a “Piggyback Registration”), the Company shall give written notice to the Investor
of its intention to effect such a registration and, subject to Sections 3(b) and 3(c), shall
include in such registration statement and in any offering of Shares to be made pursuant to that
registration statement all Registrable Shares with respect to which the Company has received a
written request for inclusion therein from the Investor within ten (10) business days after the
Investor’s receipt of the Company’s notice or, in the case of a primary offering, such shorter time
as is reasonably specified by the Company in light of the circumstances (provided that only
Registrable Shares of the same class or classes as the Shares being registered may be included).
The Company shall have no obligation to proceed with any Piggyback Registration and may abandon,
terminate and/or withdraw such registration for any reason at any time prior to the pricing
thereof. If the Company or any other Person other than the Investor proposes to sell Shares in an
underwritten offering pursuant to a registration statement on Form S-3 under the Securities Act,
such offering shall be treated as a primary or secondary underwritten offering pursuant to a
Piggyback Registration.
(b) Priority on Primary Piggyback Registrations. If a Piggyback Registration is
initiated as a primary underwritten offering on behalf of the Company and the managing underwriters
advise the Company and the Investor (if the Investor has elected to include Registrable Shares in
such Piggyback Registration) that in their opinion the number of Shares proposed to be included in
such offering exceeds the number of Shares (of any class) which can be sold in such offering
without materially delaying or jeopardizing the success of the offering (including the price per
share of the Shares proposed to be sold in such offering), the Company shall include in such
registration and offering (i) first, the number of Shares that the Company proposes to sell, and
(ii) second, the number of Shares requested to be included therein by holders of Shares, including
the Investor (if the Investor has elected to include Registrable Shares in such Piggyback
Registration), pro rata among all such holders on the basis of the number of Shares requested to be
included therein by all such holders or as such holders and the Company may otherwise agree (with
such allocations among different classes of Shares, if more than one are involved, to be determined
by the Company).
(c) Priority on Secondary Piggyback Registrations. If a Piggyback Registration is
initiated as an underwritten registration on behalf of a holder of Shares other than the Investor,
and the managing underwriters advise the Company that in their opinion the number of Shares
proposed to be included in such registration exceeds the number of Shares (of any class) which can
be sold in such offering without materially delaying or jeopardizing the success of the offering
(including the price per share of the Shares to be sold in such offering), then the Company shall
include in such registration (i) first, the number of Shares requested to be included therein by
the holder(s) requesting
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such registration, (ii) second, the number of Shares requested to be included therein by other
holders of Shares including the Investor (if the Investor has elected to include Registrable Shares
in such Piggyback Registration) and (iii) third, the number of Shares that the Company proposes to
sell, pro rata among such holders on the basis of the number of Shares requested to be included
therein by such holders or as such holders and the Company may otherwise agree (with allocations
among different classes of Shares, if more than one are involved, to be determined by the Company).
(d) Selection of Underwriters. If any Piggyback Registration is a primary or
secondary underwritten offering, the Company shall have the right to select the managing
underwriter or underwriters to administer any such offering.
(e) Basis of Participations. The Investor may not sell Registrable Shares in any
offering pursuant to a Piggyback Registration unless it (a) agrees to sell such Shares on the same
basis provided in the underwriting or other distribution arrangements approved by the Company and
that apply to the Company and/or any other holders involved in such Piggyback Registration and (b)
completes and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements, lockups and other documents required under the terms of such arrangements.
Section 4. S-3 Shelf Registration.
(a) Right to Request Registration. Subject to the provisions hereof, at any time when
the Company is eligible to use Form S-3 prior to the Termination Date, the Investor shall be
entitled to request on two (2) occasions that the Company file a Registration Statement on Form S-3
(or an amendment or supplement to an existing registration statement on Form S-3) for a public
offering of all or such portion of the Registrable Shares designated by the Investor pursuant to
Rule 415 promulgated under the Securities Act or otherwise (an “S-3 Shelf Registration”).
A request for an S-3 Shelf Registration may not be made within three months after the Investor has
sold Shares in a Demand Registration or at any time when an S-3 Shelf Registration is in effect or
the Company is diligently pursuing a primary or secondary underwritten offering pursuant to a
registration statement. Upon such request, and subject to Section 5, the Company shall (i) file a
Registration Statement (or any amendment or supplement thereto) covering the number of shares of
Registrable Shares specified in such request under the Securities Act on Form S-3 (an “S-3
Shelf Registration Statement”) for public sale in accordance with the method of disposition
specified in such request within twenty (20) business days after the Investor’s written request
therefor and (ii) use best efforts, if necessary, to cause such S-3 Shelf Registration Statement to
become effective as soon as practicable thereafter and in any event within sixty (60) calendar days
of the Investor’s written request for such S-3 Shelf Registration. If permitted under the
Securities Act (and the rules and regulations thereunder), such Registration Statement shall be one
that becomes automatically effective upon filing. The right to request an S-3 Shelf Registration
may be exercised no more than twice in the aggregate, regardless of the number of Permitted
Transferees who may become an Investor pursuant to Section 11. If the Investor has used its right
to a S-3 Shelf Registration pursuant to this Section 4 and has exercised fewer than three Demand
Registrations, the Investor may elect a third S-3 Shelf Registration and, upon such election, the
number of Demand Registrations available to the Investor shall be reduced by one.
(b) Right to Effect Shelf Takedowns. The Investor shall be entitled, at any time and
from time to time when an S-3 Shelf Registration Statement is effective and until the Termination
Date, to sell such Registrable Shares as are then registered pursuant to such S-3 Registration
Statement (each, a “Shelf Takedown”), but only upon not less than three (3) business days’
prior written notice to the Company (if such takedown is to be underwritten). The Investor shall
be entitled to request that a Shelf Takedown shall be an underwritten offering; provided
that (based on the then-current market prices) the number of Registrable Shares included in each
such underwritten Shelf Takedown would reasonably be expected to yield gross proceeds to the
Investor of at least the Minimum Amount; provided further that the Investor shall not be
entitled to request any underwritten Shelf Takedown (i) within three months after the Investor has
sold Shares in an underwritten offering effected pursuant to a (x) Demand Registration or (y) S-3
Shelf Registration or (ii) at any time when the Company is diligently pursuing a primary or
secondary underwritten offering of Shares pursuant to a registration statement. The Investor shall
give the Company prompt written notice of the consummation of each Shelf Takedown (whether or not
underwritten).
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(c) Priority on Underwritten Shelf Takedowns. The Company may include Shares other
than Registrable Shares in an underwritten Shelf Takedown for any accounts on the terms provided
below, but only with
the consent of the managing underwriters of such offering and the Investor (such consent not
to be unreasonably withheld). If the managing underwriters of the requested underwritten Shelf
Takedown advise the Company and the Investor that in their opinion the number of Shares proposed to
be included in the underwritten Shelf Takedown exceeds the number of Shares which can be sold in
such offering without materially delaying or jeopardizing the success of the offering (including
the price per share of the Shares proposed to be sold in such offering), the Company shall include
in such underwritten Shelf Takedown (i) first, the number of Shares that the Investor proposes to
sell, and (ii) second, the number of Shares proposed to be included therein by any other Persons
(including Shares to be sold for the account of the Company) allocated among such Persons in such
manner as the Company may determine. If the number of Shares which can be sold is less than the
number of Registrable Shares proposed to be included in the underwritten Shelf Takedown pursuant to
clause (i) above, the amount of Shares to be so sold shall be allocated to the Investor. The
provisions of this paragraph (c) apply only to a Shelf Takedown that the Investor has requested be
an underwritten offering.
(d) Selection of Underwriters. If any of the Registrable Shares are to be sold in an
underwritten Shelf Takedown initiated by the Investor, the Company shall have the right to select
the managing underwriter or underwriters to lead the offering.
(e) Effective Period of S-3 Shelf Registrations. The Company shall use best efforts
to keep any S-3 Shelf Registration Statement effective for a period of 90 days after the later of
the following dates (i) the effective date of such registration statement and (ii) the date on
which the applicable holding period for restricted securities held by an affiliate of the Company
pursuant to Rule 144 under the Securities Act shall have lapsed; provided that such period
shall be extended by the number of days in any Suspension Period commenced pursuant to Section 5
during such period (as it may be so extended) and by the number of days in any Third Party Holdback
Period commenced during such period (as it may be so extended). Notwithstanding the foregoing, the
Company shall not be obligated to keep any such registration statement effective, or to permit
Registrable Shares to be registered, offered or sold thereunder, at any time on or after the
Termination Date.
Section 5. Suspension Periods.
(a) Suspension Periods. The Company may (i) delay the filing or effectiveness of a
Registration Statement in conjunction with a Demand Registration or an S-3 Shelf Registration or
(ii) prior to the pricing of any underwritten offering or other offering of Registrable Shares
pursuant to a Demand Registration or an S-3 Shelf Registration, delay such underwritten or other
offering (and, if it so chooses, withdraw any registration statement that has been filed), but in
each case described in clauses (i) and (ii) only if the Company reasonably determines (x) that
proceeding with such an offering would require the Company to disclose material information that
would not otherwise be required to be disclosed at that time and that the disclosure of such
information at that time would not be in the Company’s best interests, or (y) that the registration
or offering to be delayed would, if not delayed, materially adversely affect the Company and its
subsidiaries taken as a whole or materially interfere with, or jeopardize the success of, any
pending or proposed material transaction, including any debt or equity financing, any acquisition
or disposition, any recapitalization or reorganization or any other material transaction, whether
due to commercial reasons, a desire to avoid premature disclosure of information or any other
reason. Any period during which the Company has delayed a filing, an effective date or an offering
pursuant to this Section 5 is herein called a “Suspension Period”. If pursuant to this
Section 5 the Company delays or withdraws a Demand Registration or S-3 Shelf Registration requested
by the Investor, the Investor shall be entitled to withdraw such request and, if it does so, such
request shall not count against the limitation on the number of such registrations set forth in
Section 2 or Section 4. The Company shall provide prompt written notice to the Investor of the
commencement and termination of any Suspension Period (and any withdrawal of a registration
statement pursuant to this Section 5), but shall not be obligated under this Agreement to disclose
the reasons therefor. The Investor shall keep the existence of each Suspension Period confidential
and refrain from making offers and sales of Registrable Shares (and direct any other Persons making
such offers and sales to refrain from doing so) during each Suspension Period. In no event (i) may
the Company deliver notice of a Suspension Period to the Investor more than three (3) times in any
calendar year and (ii) shall a Suspension Period or Suspension Periods be in effect for an
aggregate of one hundred and eighty (180) days or more in any calendar year.
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(b) Other Lockups. Notwithstanding any other provision of this Agreement, the Company
shall not be obligated to take any action hereunder that would violate any lockup or similar
restriction binding on the Company in connection with a prior or pending registration or
underwritten offering.
(c) Warrant Issuance Agreement Restrictions. Nothing in this Agreement shall affect
the restrictions on transfers of Shares in Section 4.3 of the Warrant Issuance Agreement, which
shall apply independently hereof in accordance with the terms thereof.
Section 6. Holdback Agreements.
The restrictions in this Section 6 shall apply for as long as the Investor is the beneficial
owner of any Registrable Shares. If the Company sells Shares or other securities convertible into
or exchangeable for (or otherwise representing a right to acquire) Shares in a primary underwritten
offering pursuant to any registration statement under the Securities Act (but only if the Investor
is provided its piggyback rights, if any, in accordance with Sections 3(a) and 3(b)), or if any
other Person sells Shares in a secondary underwritten offering pursuant to a Piggyback Registration
in accordance with Sections 3(a) and 3(b), and if the managing underwriters for such offering
advise the Company (in which case the Company promptly shall notify the Investor) that a public
sale or distribution of Shares outside such offering would materially adversely affect such
offering, then, if requested by the Company, the Investor shall agree, as contemplated in this
Section 6, not to (and to cause its majority-controlled Affiliates not to) sell, transfer, pledge,
issue, grant or otherwise dispose of, directly or indirectly (including by means of any short
sale), or request the registration of, any Registrable Shares (or any securities of any Person that
are convertible into or exchangeable for, or otherwise represent a right to acquire, any
Registrable Shares) for a period (each such period, a “Holdback Period”) beginning on the
tenth (10th)day before the pricing date for the underwritten offering and extending
through the earlier of (i) the ninetieth (90th)day after such pricing date (subject to
customary automatic extension in the event of the release of earnings results of or material news
relating to the Company) and (ii) such earlier day (if any) as may be designated for this purpose
by the managing underwriters for such offering (each such agreement of the Investor, a
“Holdback Agreement”). Each Holdback Agreement shall be in writing in form and substance
satisfactory to the Company and the managing underwriters. Notwithstanding the foregoing, the
Investor shall not be obligated to make a Holdback Agreement unless the Company and each selling
shareholder in such offering also execute agreements substantially similar to such Holdback
Agreement. A Holdback Agreement shall not apply to (i) the exercise of any warrants or options to
purchase shares of the Company (provided that such restrictions shall apply with respect to
the securities issuable upon such exercise) or (ii) any Shares included in the underwritten
offering giving rise to the application of this Section 6.
Section 7. Registration Procedures.
(a) Whenever the Investor requests that any Registrable Shares be registered pursuant to this
Agreement, the Company shall use reasonable best efforts to effect, as soon as practicable as
provided herein, the registration and the sale of such Registrable Shares in accordance with the
intended methods of disposition thereof, and, pursuant thereto, the Company shall, as soon as
practicable as provided herein:
(i) subject to the other provisions of this Agreement, prepare and file with the SEC a
Registration Statement with respect to such Registrable Shares and use best efforts to cause
such Registration Statement to become effective (unless it becomes automatically effective
upon filing);
(ii) prepare and file with the SEC such amendments and supplements to such Registration
Statement and the Prospectus used in connection therewith as may be necessary to comply with
the applicable requirements of the Securities Act and use best efforts to keep such
Registration Statement effective for the relevant period required hereunder, but no longer
than is necessary to complete the distribution of the Shares covered by such Registration
Statement, and to comply with the applicable requirements of the Securities Act with respect
to the disposition of all the Shares covered by such Registration Statement during such
period in accordance with the intended methods of disposition set forth in such Registration
Statement;
- 8 -
(iii) use reasonable best efforts to obtain the withdrawal of any order suspending the
effectiveness of any Registration Statement, or the lifting of any suspension of the
qualification or exemption from qualification of any Registrable Shares for sale in any
jurisdiction in the United States;
(iv) deliver, without charge, such number of copies of the preliminary and final
Prospectus and any supplement thereto as the Investor may reasonably request in order to
facilitate the disposition of the Registrable Shares of the Investor covered by such
Registration Statement in conformity with the requirements of the Securities Act;
(v) use reasonable best efforts to register or qualify such Registrable Shares under
such other securities or blue sky laws of such U.S. jurisdictions as the Investor reasonably
requests and continue such registration or qualification in effect in such jurisdictions for
as long as the applicable Registration Statement may be required to be kept effective under
this Agreement (provided that the Company will not be required to (I) qualify
generally to transact business in any jurisdiction where it would not otherwise be required
to qualify but for this subparagraph (v), (II) subject itself to taxation in any such
jurisdiction or (III) consent to general service of process in any such jurisdiction);
(vi) notify the Investor and each distributor of such Registrable Shares identified by
the Investor, at any time when a Prospectus relating thereto would be required under the
Securities Act to be delivered by such distributor, 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 a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not misleading, and, at
the request of the Investor, the Company shall use reasonable best efforts to prepare, as
soon as practicable, a supplement or amendment to such Prospectus so that, as thereafter
delivered to any prospective purchasers of such Registrable Shares, such Prospectus shall
not contain an untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in light of the circumstances under which they
were made, not misleading;
(vii) in the case of an underwritten offering in which the Investor participates
pursuant to a Demand Registration, a Piggyback Registration or an S-3 Shelf Registration,
enter into an underwriting agreement, containing such provisions (including provisions for
indemnification, lockups, opinions of counsel and comfort letters), and take all such other
customary and reasonable actions as the managing underwriters of such offering may request
in order to facilitate the disposition of such Registrable Shares (including, making members
of senior management of the Company available at reasonable times and places to participate
in “road-shows” that the managing underwriter determines are necessary to effect the
offering);
(viii) in the case of an underwritten offering in which the Investor participates
pursuant to a Demand Registration, a Piggyback Registration or an S-3 Shelf Registration,
and to the extent not prohibited by applicable law, (A) make reasonably available, for
inspection by the managing underwriters of such offering and one attorney and accountant
acting for such managing underwriters, pertinent corporate documents and financial and other
records of the Company and its subsidiaries and controlled Affiliates, (B) cause the
Company’s officers and employees to supply information reasonably requested by such managing
underwriters or attorney in connection with such offering, (C) make the Company’s
independent accountants available for any such managing underwriters’ due diligence and have
them provide customary comfort letters to such underwriters in connection therewith; and (D)
cause the Company’s counsel to furnish customary legal opinions to such underwriters in
connection therewith; provided however that such records and other information shall
be subject to such confidential treatment as is customary for underwriters’ due diligence
reviews;
(ix) prior to the issuance of such Registrable Shares, cause all such Registrable
Shares to be listed on each primary securities exchange (if any) on which securities of the
same class issued by the Company are then listed, subject only to the official notice of
issuance of such Registrable Shares;
- 9 -
(x) provide a transfer agent and registrar for all such Registrable Shares not later
than the effective date of such Registration Statement and, a reasonable time before any
proposed sale of Registrable Shares pursuant to a Registration Statement, provide the
transfer agent with printed certificates for the Registrable Shares to be sold, subject to
the provisions of Section 11;
(xi) make generally available to its shareholders a consolidated earnings statement
(which need not be audited) for a period of twelve (12) months beginning after the effective
date of the Registration Statement as soon as reasonably practicable after the end of such
period, which earnings statement shall satisfy the requirements of an earning statement
under Section 11(a) of the Securities Act and Rule 158 thereunder; and
(xii) promptly notify the Investor and the managing underwriters of any underwritten
offering, if any:
(1) when the Registration Statement, any pre-effective amendment, the
Prospectus or any Prospectus supplement or any post-effective amendment to
the Registration Statement has been filed and, with respect to the
Registration Statement or any post-effective amendment, when the same has
become effective;
(2) of any request by the SEC for amendments or supplements to the
Registration Statement or the Prospectus or for any additional information
regarding the Investor;
(3) of the notification to the Company by the SEC of its initiation of
any proceeding with respect to the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement; and
(4) of the receipt by the Company of any notification with respect to
the suspension of the qualification of any Registrable Shares for sale under
the applicable securities or blue sky laws of any jurisdiction.
For the avoidance of doubt, the provisions of clauses (vii), (viii), (xi) and (xii) of this
Section 7(a) shall apply only in respect of an underwritten offering and only if (based on market
prices at the time the offering is requested by the Investor) the number of Registrable Shares to
be sold in the offering would reasonably be expected to yield gross proceeds to the Investor of at
least the Minimum Amount.
(b) No Registration Statement (including any amendments thereto) shall contain any untrue
statement of a material fact or omit to state a material fact required to be stated therein, or
necessary to make the statements therein not misleading, and no Prospectus (including any
supplements thereto) shall contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the circumstances under which
they were made, not misleading, in each case, except for any untrue statement or alleged untrue
statement of a material fact or omission or alleged omission of a material fact made in reliance on
and in conformity with written information furnished to the Company by or on behalf of the Investor
or any underwriter or other distributor specifically for use therein.
(c) At all times after the Company has filed a registration statement with the SEC pursuant to
the requirements of the Securities Act and until the Termination Date, the Company shall use
reasonable best efforts to continuously maintain in effect the registration statement of Common
Stock under Section 12 of the Exchange Act and to use reasonable best efforts to file all reports
required to be filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder, all to the extent required to enable the Investor to be
eligible to sell Registrable Shares (if any) pursuant to Rule 144 under the Securities Act.
(d) The Company may require the Investor and each distributor of Registrable Shares as to
which any registration is being effected to furnish to the Company information regarding such Person and the
- 10 -
distribution of such securities as the Company may from time to time reasonably
request in connection with such registration.
(e) The Investor agrees by having its Common Stock treated as Registrable Shares hereunder
that, upon being advised in writing by the Company of the occurrence of an event pursuant to
Section 7(a)(vi), the Investor will immediately discontinue (and direct any other Persons making
offers and sales of Registrable Shares to immediately discontinue) offers and sales of Registrable
Shares pursuant to any Registration Statement (other than those pursuant to a plan that is in
effect prior to such time and that complies with Rule 10b5-1 of the Exchange Act) until it is
advised in writing by the Company that the use of the Prospectus may be resumed and is furnished
with a supplemented or amended Prospectus as contemplated by Section 7(a)(vi), and, if so directed
by the Company, the Investor will deliver to the Company all copies, other than permanent file
copies then in the Investor’s possession, of the Prospectus covering such Registrable Shares
current at the time of receipt of such notice.
(f) The Company may prepare and deliver an issuer free-writing prospectus (as such term is
defined in Rule 405 under the Securities Act) in lieu of any supplement to a prospectus, and
references herein to any “supplement” to a Prospectus shall include any such issuer free-writing
prospectus. Neither the Investor nor any other seller of Registrable Shares may use a free-writing
prospectus to offer or sell any such shares without the Company’s prior written consent.
(g) It is understood and agreed that any failure of the Company to file a registration
statement or any amendment or supplement thereto or to cause any such document to become or remain
effective or usable within or for any particular period of time as provided in Section 2, 4 or 7 or
otherwise in this Agreement, due to reasons that are not reasonably within its control, or due to
any refusal of the SEC to permit a registration statement or prospectus to become or remain
effective or to be used because of unresolved SEC comments thereon (or on any documents
incorporated therein by reference) despite the Company’s good faith and reasonable best efforts to
resolve those comments, shall not be a breach of this Agreement.
(h) It is further understood and agreed that the Company shall not have any obligations under
this Section 7 at any time on or after the Termination Date, unless an underwritten offering in
which the Investor participates has been priced but not completed prior to the Termination Date, in
which event the Company’s obligations under this Section 7 shall continue with respect to such
offering until it is so completed (but not more than 60 days after the commencement of the
offering).
(i) Notwithstanding anything to the contrary in this Agreement, the Company shall not be
required to file a Registration Statement or include Registrable Shares in a Registration Statement
unless it has received from the Investor, at least five (5) days prior to the anticipated filing
date of the Registration Statement, all requested information required to be provided by the
Investor for inclusion therein.
Section 8. Registration Expenses.
(a) All expenses incident to the Company’s performance of or compliance with this Agreement,
including all registration and filing fees, fees and expenses of compliance with securities or blue
sky laws, FINRA fees, listing application fees, printing expenses, transfer agent’s and registrar’s
fees, cost of distributing Prospectuses in preliminary and final form as well as any supplements
thereto, and fees and disbursements of counsel for the Company and all independent certified public
accountants and other Persons retained by the Company (all such expenses being herein called
“Registration Expenses”) (but not including any underwriting discounts or commissions
attributable to the sale of Registrable Shares or fees and expenses of counsel and any other
advisor representing any underwriters or other distributors), shall be borne by the Company. The
Investor shall bear the cost of all underwriting discounts and commissions associated with any sale
of Registrable Shares and shall pay all of its own costs and expenses, including all fees and
expenses of any counsel (and any other advisers) representing the Investor and any stock transfer
taxes.
(b) The obligation of the Company to bear the expenses described in Section 8(a) shall apply
irrespective of whether a registration, once properly demanded or requested becomes effective or is
withdrawn or suspended; provided however that Registration Expenses for any Registration
Statement withdrawn solely at the
- 11 -
request of the Investor (unless withdrawn following commencement
of a Suspension Period pursuant to Section 5) shall be borne by the Investor.
Section 9. Indemnification.
(a) The Company shall indemnify, to the fullest extent permitted by law, the Investor and each
Person who controls the Investor (within the meaning of the Securities Act) against all losses,
claims, damages, liabilities, judgments, costs (including reasonable costs of investigation) and
expenses (including reasonable attorneys’ fees) arising out of or based upon any untrue or alleged
untrue statement of a material fact contained in any Registration Statement or Prospectus or any
amendment thereof or supplement thereto or arising out of or based upon any omission or alleged
omission of a material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as the same are made in reliance and in conformity with
information furnished in writing to the Company by the Investor expressly for use therein. In
connection with an underwritten offering in which the Investor participates conducted pursuant to a
registration effected hereunder, the Company shall indemnify each participating underwriter and
each Person who controls such underwriter (within the meaning of the Securities Act) to the same
extent as provided above with respect to the indemnification of the Investor.
(b) In connection with any Registration Statement in which the Investor is participating, the
Investor shall furnish to the Company in writing such information as the Company reasonably
requests for use in connection with any such Registration Statement or Prospectus, or amendment or
supplement thereto, and shall indemnify, to the fullest extent permitted by law, the Company, its
officers and directors and each Person who controls the Company (within the meaning of the
Securities Act) against all losses, claims, damages, liabilities, judgments, costs (including
reasonable costs of investigation) and expenses (including reasonable attorneys’ fees) arising out
of or based upon any untrue or alleged untrue statement of material fact contained in the
Registration Statement or Prospectus, or any amendment or supplement thereto, or arising out of or
based upon any omission or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, but only to the extent that the same are
made in reliance and in conformity with information furnished in writing to the Company by or on
behalf of the Investor expressly for use therein.
(c) Any Person entitled to indemnification hereunder shall (i) give prompt written notice to
the indemnifying Person of any claim with respect to which it seeks indemnification and (ii) permit
such indemnifying Person to assume the defense of such claim with counsel reasonably satisfactory
to the indemnified Person. Failure so to notify the indemnifying Person shall not relieve it from
any liability that it may have to an indemnified Person except to the extent that the indemnifying
Person is materially and adversely prejudiced thereby. The indemnifying Person shall not be subject
to any liability for any settlement made by the indemnified Person without its consent (but such
consent will not be unreasonably withheld). An indemnifying Person who is entitled to, and elects
to, assume the defense of a claim shall not be obligated to pay the fees and expenses of more than
one counsel (in addition to one local counsel) for all Persons indemnified (hereunder or otherwise)
by such indemnifying Person with respect to such claim (and all other claims arising out of the
same circumstances), unless in the reasonable judgment of any indemnified Person there may be one
or more legal or equitable defenses available to such indemnified Person which are in addition to
or may conflict with those available to another indemnified Person with respect to such claim, in
which case such maximum number of counsel for all indemnified Persons shall be two rather than one.
If an indemnifying Person is entitled to, and elects to, assume the defense of a claim, the
indemnified Person shall continue to be entitled to participate in the defense thereof, with
counsel of its own choice, but, except as set forth above, the indemnifying Person shall not be
obligated to reimburse the indemnified Person for the costs thereof. The indemnifying Person shall
not consent to the entry of any judgment or enter into or agree to any settlement relating to a
claim or action for which any indemnified Person would be entitled to indemnification by any
indemnified Person hereunder unless such judgment or settlement imposes no ongoing obligations on
any such indemnified Person and includes as an unconditional term the giving, by all relevant
claimants and plaintiffs to such indemnified Person, a release, satisfactory in form and substance
to such indemnified Person, from all liabilities in respect of such claim or action for which such
indemnified Person would be entitled to such indemnification. The indemnifying Person shall not be
liable hereunder for any amount paid or payable or incurred pursuant to or in connection with any
judgment entered or settlement effected with the consent of an indemnified Person unless the
indemnifying Person has also consented to such judgment or settlement.
- 12 -
(d) The indemnification provided for under this Agreement shall remain in full force and
effect regardless of any investigation made by or on behalf of the indemnified Person or any
officer, director or controlling Person of such indemnified Person and shall survive the transfer
of securities and the Termination Date but only with
respect to offers and sales of Registrable Shares made before the Termination Date or during
the period following the Termination Date referred to in Section 7(h).
(e) If the indemnification provided for in or pursuant to this Section 9 is due in accordance
with the terms hereof, but is held by a court to be unavailable or unenforceable in respect of any
losses, claims, damages, liabilities or expenses referred to herein, then each applicable
indemnifying Person, in lieu of indemnifying such indemnified Person, 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 Person on the one hand and of the indemnified Person on the other in connection with
the statements or omissions which result in such losses, claims, damages, liabilities or expenses
as well as any other relevant equitable considerations. The relative fault of the indemnifying
Person 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 Person or by the indemnified Person, and by such Person’s relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or omission. In no
event shall the liability of the indemnifying Person be greater in amount than the amount for which
such indemnifying Person would have been obligated to pay by way of indemnification if the
indemnification provided for under Section 9(a) or 9(b) hereof had been available under the
circumstances.
Section 10. Securities Act Restrictions.
The Registrable Shares are restricted securities under the Securities Act and may not be
offered or sold except pursuant to an effective registration statement or an available exemption
from registration under the Securities Act. Accordingly, the Investor shall not, directly or
through others, offer or sell any Registrable Shares except pursuant to a Registration Statement as
contemplated herein or pursuant to Rule 144 or another exemption from registration under the
Securities Act, if available. The Company may impose stop-transfer instructions with respect to
any Registrable Shares that are to be transferred in contravention of this Agreement. Any
certificates representing the Registrable Shares may bear a legend (and the Company’s share
registry may bear a notation) referencing the restrictions on transfer contained in this Agreement
(and the Warrant Issuance Agreement), until such time as such securities have ceased to be (or are
to be transferred in a manner that results in their ceasing to be) Registrable Shares. Subject to
the provisions of this Section 10, the Company will replace any such legended certificates with
unlegended certificates promptly upon surrender of the legended certificates to the Company or its
designee, in order to facilitate a lawful transfer or at any time after such shares cease to be
Registrable Shares.
Section 11. Transfers of Rights.
(a) If the Investor transfers any rights to a Permitted Transferee in accordance with the
Warrant Issuance Agreement, such Permitted Transferee shall, together with all other such Permitted
Transferees and the Investor, also have the rights of the Investor under this Agreement, but only
if the Permitted Transferee signs and delivers to the Company a written acknowledgment (in form and
substance satisfactory to the Company) that it has joined with the Investor and the other Permitted
Transferees as a party to this Agreement and has assumed the rights and obligations of the Investor
hereunder with respect to the rights transferred to it by the Investor. Each such transfer shall
be effective when (but only when) the Permitted Transferee has signed and delivered the written
acknowledgment to the Company. Upon any such effective transfer, the Permitted Transferee shall
automatically have the rights so transferred, and the Investor’s obligations under this Agreement,
and the rights not so transferred, shall continue; provided that so long as the original
Investor (not including any Permitted Transferee) has any remaining Registrable Shares, the right
to request Demand Registrations and Shelf Registrations shall be held only by the original Investor
(and not any Permitted Transferees) and under no circumstances shall the Company be required to
provide (i) more than three (3) Demand Registrations and (ii) more than two (2) Shelf Registration
(or three (3) in the event the Investor elects to exchange one of its Demand Rights for a Shelf
Registration). Notwithstanding any other provision of this Agreement, no Person who acquires
securities transferred in violation of this Agreement or the Warrant Issuance Agreement, or who
acquires securities that are not or upon acquisition cease to be Registrable
- 13 -
Shares, shall have any
rights under this Agreement with respect to such securities, and such securities shall not have the
benefits afforded hereunder to Registrable Shares.
Section 12. Miscellaneous.
(a) Notices. Any notice, request, instruction or other document to be given hereunder
by any party to the other will be in writing and will be deemed to have been duly given (a) on the
date of delivery if delivered personally, or by facsimile, upon confirmation of receipt, or (b) on
the second business day following the date of dispatch if delivered by a recognized next day
courier service. All notices hereunder shall be delivered as set forth below, or pursuant to such
other instructions as may be designated in writing by the party to receive such notice.
If to the Company:
ION Geophysical Corporation
0000 XxxxXxxx Xxxx. Xxxxx 000
Xxxxxxx, Xxxxx 00000-0000
Xxxxxx Xxxxxx of America
Attention: Xx. Xxxxx X. Xxxxxx
Facsimile: (x000-000) 000 0000
0000 XxxxXxxx Xxxx. Xxxxx 000
Xxxxxxx, Xxxxx 00000-0000
Xxxxxx Xxxxxx of America
Attention: Xx. Xxxxx X. Xxxxxx
Facsimile: (x000-000) 000 0000
If to the Investor:
BGP Inc., China National Petroleum Corporation
Xx. 000, Xxxx Xxxxxxx Xxxxxx,
Xxxx Xxxx 000000, Xxxxx
People’s Republic of China
Attention: Xx. Xxxxxxxx Xxx
Facsimile: (x00-00) 0000 0000
Xx. 000, Xxxx Xxxxxxx Xxxxxx,
Xxxx Xxxx 000000, Xxxxx
People’s Republic of China
Attention: Xx. Xxxxxxxx Xxx
Facsimile: (x00-00) 0000 0000
with a copy to:
Xxxxxxxx & Xxxxxxxx LLP
28th Floor
Nine Queen’s Road Central
Hong Kong
Attention: Xxxx Xxx
Facsimile: (x000) 0000 0000
28th Floor
Nine Queen’s Road Central
Hong Kong
Attention: Xxxx Xxx
Facsimile: (x000) 0000 0000
(b) No Waivers. No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
(c) Assignment. Neither this Agreement nor any right, remedy, obligation nor
liability arising hereunder or by reason hereof shall be assignable by any party hereto without the
prior written consent of the other parties, and any attempt to assign any right, remedy, obligation
or liability hereunder without such consent shall be void, except (i) an assignment, in the case of
a merger or consolidation where such party is not the surviving entity, or a sale of substantially
all of its assets, to the entity which is the survivor of such merger or consolidation or the
purchaser in such sale or (ii) an assignment by Investor to a Permitted Transferee in accordance
with the terms hereof.
(d) No Third-Party Beneficiaries. Nothing contained in this Agreement, expressed or
implied, is intended to confer upon any person or entity other than the Company and the Investor
(and any Permitted Transferee
- 14 -
to which an assignment is made in accordance with this Agreement),
any benefits, rights, or remedies (except as specified in Section 9 hereof).
(e) This Agreement will be governed by and construed in accordance with the laws of the State
of New York, without giving effect to the conflict of laws principles thereof.
(i) Each of the parties hereto agrees all disputes arising among the parties in
connection with the Transaction Documents, or the breach, termination, interpretation
or validity thereof, shall be finally settled by the Hong Kong International
Arbitration Centre (the “HKIAC”) pursuant to UNCITRAL Rules with the Company, on the
one hand, being entitled to designate one arbitrator, and with the Investor, on the
other hand, being entitled to designate one arbitrator, while the third arbitrator
will be selected by agreement between the two designated arbitrators or, failing such
agreement, within 10 calendar days of initial consultation between the two
arbitrators, by the HKIAC pursuant to its arbitration rules. If any party fails to
designate its arbitrator within 20 calendar days after the designation of the first
of the three arbitrators, the HKIAC shall have the authority to designate any person
whose interests are neutral to the parties as the second of the three arbitrators.
The arbitration shall be conducted in English. To the extent consistent with
UNCITRAL Rules, each of the parties hereto shall cooperate with the others in
provision of information during any discovery process relating to arbitrations in
connection with the Transaction Documents. The parties hereto further agree that, to
the extent consistent with UNCITRAL Rules, the parties shall be entitled to seek
temporary and permanent injunctive relief from the arbitrators without the necessity
of proving actual damages and without posting a bond or other security.
(ii) Each of the parties hereto agrees that notice may be served upon such party
at the address and in the manner set forth for such party in Section 12(a).
(iii) To the extent permitted by applicable laws, each of the parties hereto
hereby unconditionally waives trial by jury in any legal action or proceeding
relating to the Transaction Documents or the transactions contemplated hereby or
thereby.
(f) Counterparts; Effectiveness. This Agreement may be executed in any number of
counterparts (including by e-mail or facsimile) and by different parties hereto in separate
counterparts, with the same effect as if all parties had signed the same document. All such
counterparts shall be deemed an original, shall be construed together and shall constitute one and
the same instrument. This Agreement shall become effective when each party hereto shall have
received counterparts hereof signed by all of the other parties hereto.
(g) Entire Agreement. This Agreement contains the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes and replaces all other
prior agreements, written or oral, among the parties hereto with respect to the subject matter
hereof.
(h) Captions. The headings and other captions in this Agreement are for convenience
and reference only and shall not be used in interpreting, construing or enforcing any provision of
this Agreement.
(i) Severability. If any term, provision, covenant or restriction of this Agreement
is held by a court of competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected, impaired or invalidated so
long as the economic or legal substance of the transactions contemplated hereby is not affected in
any manner materially adverse to any party. Upon such a determination, the parties shall negotiate
in good faith to modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner in order that the transactions contemplated hereby be
consummated as originally contemplated to the fullest extent possible.
(j) Additional Registration Rights. The Company agrees that it shall not grant any
registration rights to any third party (i) unless such rights are expressly made subject to the rights of the Investor in a manner
- 15 -
consistent with this Agreement or (ii) if such registration
rights are senior to, or take priority over, the registration rights granted to the Investor under
this Agreement.
(k) Amendments. The provisions of this Agreement, including the provisions of this
sentence, may not be amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given without the prior written consent of the Company and the
Investor.
[Remainder of page intentionally left blank]
- 16 -
In Witness Whereof, this Registration Rights Agreement has been duly executed by each of
the parties hereto as of the date first written above.
| ION GEOPHYSICAL CORPORATION |
||||
| By: | /s/ Xxxxx X. Xxxxxx | |||
| Name: | Xxxxx X. Xxxxxx | |||
| Title: | Senior Vice President, General Counsel and Corporate Secretary | |||
| BGP INC., CHINA NATIONAL PETROLEUM CORPORATION |
||||
| By: | /s/ Wang Tiejun | |||
| Name: | Wang Tiejun | |||
| Title: | President | |||
