EXHIBIT 99.3
EXECUTION COPY
Equity Registration Rights Agreement
between
PG&E Corporation
and
LB I Group Inc.
and
Each Other Entity Named
On the Signature Pages Hereof
Dated as of June 25, 2002
TABLE OF CONTENTS
Page
----
1. Definitions ..................................................... 1
2. Shelf Registration .............................................. 4
3. Liquidated Damages. ............................................. 5
4. Piggy-Back Registration Rights .................................. 6
5. Underwriting Procedures ......................................... 7
6. Registration Procedures. ........................................ 8
7. Registration Expenses. .......................................... 15
8. Indemnification and Contribution ................................ 15
9. Rule 144 ........................................................ 19
10. Participation in Underwritten Registrations. .................... 19
11. Purchase By Issuer. ............................................. 19
12. Miscellaneous. .................................................. 19
Equity Registration Rights Agreement, dated as of June 25, 2002,
between PG&E Corporation, a California corporation (together with any successor
entity, herein referred to as the "Issuer"), and LB I Group Inc. and each other
entity named on the signature pages hereof (the "Initial Holders").
Pursuant to the Warrant Agreement, dated the date hereof (the
"Warrant Agreement"), between the Issuer and the Initial Holders and, in order
to induce the Initial Lender (as defined in the Warrant Agreement) to enter into
the Amended and Restated Credit Agreement, dated as of the date hereof (the
"Credit Agreement"), between the Issuer, the Initial Lender and the other
lenders party thereto, Xxxxxx Commercial Paper Inc., as Administrative Agent and
Xxxxxx Brothers Inc., as Lead Arranger and Book Manager as amended, restated,
modified, renewed, refunded, replaced or refinanced in whole or in part from
time to time, the Issuer has agreed to the registration rights set forth in this
Agreement. The execution of this Agreement is a condition to Closing (as defined
in the Credit Agreement) under the Credit Agreement.
The parties hereby agree as follows:
1. Definitions. As used in this Agreement, the following capitalized
terms shall have the following meanings:
Agreement: This Equity Registration Rights Agreement, as amended,
modified or otherwise supplemented from time to time in accordance with
the terms hereof.
Bankruptcy Code: Title 11 of the United States Code entitled
"Bankruptcy", as now or hereafter in effect, or any successor thereto.
Blue Sky Application: As defined in Section 8(a) hereof.
broker-dealer: Any broker or dealer registered under the Exchange
Act.
Business Day: A day other than a Saturday or Sunday or any day on
which banking institutions in The City of New York or The City of San
Francisco are authorized or obligated by law or regulation to close.
Closing Date: The date of this Agreement.
Commission: Securities and Exchange Commission.
Common Stock: The common stock, no par value, of the Issuer.
Common Stock Equivalent: Any Convertible Security or warrant, option
or other right to subscribe for or purchase any shares of Common Stock or
any Convertible Security, other than a Warrant.
Convertible Securities: Evidences of indebtedness, shares of capital
stock or other securities which are or may be at any time convertible into
or exchangeable for shares of Common Stock.
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Credit Agreement: As defined in the recitals hereto.
Effectiveness Period: As defined in Section 2(a)(iii) hereof.
Effectiveness Target Date: As defined in Section 2(a)(ii) hereof.
Exchange Act: Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission promulgated thereunder.
Holder: A Person who owns, beneficially or otherwise, Transfer
Restricted Securities.
Indemnified Holder: As defined in Section 8(a) hereof.
Initial Holders: As defined in the preamble hereto.
Issuer: As defined in the preamble hereto.
Liquidated Damages: As defined in Section 3(a) hereof.
Other Holders: As defined in Section 5(a) hereof.
NASD: National Association of Securities Dealers, Inc.
Person: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, or government or any agency or political
subdivision thereof.
PG&E: Pacific Gas and Electric Company, a California corporation.
Piggy-Back Registration: As defined in Section 4(a) hereof.
Piggy-Back Registration Offer: As defined in Section 4(a) hereof.
Prospectus: The prospectus included in a Shelf Registration
Statement, as amended or supplemented by any prospectus supplement and by
all other amendments thereto, including post-effective amendments, and all
material incorporated by reference into such Prospectus.
Questionnaire: As defined in Section 2(b) hereof.
Questionnaire Deadline: As defined in Section 2(b) hereof.
Registration Default: As defined in Section 3(a) hereof.
Registration Trigger Date: As defined in Section 2(a)(i) hereof.
Required Holders: Holders holding at least a 40% interest in the
Warrants or the Warrant Shares.
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Securities Act: Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
Shelf Registration Statement: As defined in Section 2(a)(i) hereof.
Suspension Notice: As defined in Section 6(c) hereof.
Suspension Period: As defined in Section 6(b)(i) hereof.
Transfer Restricted Securities: Each (i) Warrant Share (whether or
not the Warrants have been exercised) and (ii) any other securities issued
or issuable with respect to any Warrant Share by way of stock dividend or
stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or
otherwise, until the earlier of:
(i) the date on which such Warrant Share or other security has
been registered under the Securities Act on a registration statement
which has been declared effective by the Commission and disposed of
in accordance with such registration statement;
(ii) the date on which such Warrant Share or other security (A)
has been transferred in compliance with Rule 144 under the Securities
Act or (B) may be sold or transferred by a person who is not an
affiliate of the Issuer pursuant to Rule 144(k) under the Securities
Act (or any other similar provision then in force) without regard to
any volume or manner of sale restrictions thereunder; or
(iii) the date on which such Warrant Share or other security
ceases to be outstanding (whether as a result of repurchase and
cancellation, conversion or otherwise).
Underwritten Registration or Underwritten Offering: A registration in
which securities of the Issuer are sold to an underwriter for reoffering
to the public.
VWAP: means, for any security as of any date, the dollar-weighted
average price for such security on the principal United States securities
exchange on which such security is traded (which is currently the New York
Stock Exchange with respect to the Common Stock) during the period
beginning at 9:30 a.m. (New York time) (or such other time as such
exchange publicly announces is the official open of trading), and ending
at 4:00 p.m. (New York time) (or such other time as such exchange publicly
announces is the official close of trading) as reported by Bloomberg
Financial Markets (or any successor thereto, "Bloomberg") through its
"Volume at Price" functions, or, if the foregoing does not apply, the
dollar weighted average price of such security in the over-the-counter
market on the electronic bulletin board for such security during the
period beginning at 9:30 a.m. (New York time) (or such other time as such
exchange publicly announces is the official open of trading), and ending
at 4:00 p.m. (New York time) (or such other time as such exchange publicly
announces is the official close of trading) as reported by Bloomberg, or
if no dollar weighted average price is reported for such security by
Bloomberg for such hours, the average of the highest closing bid price and
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lowest closing ask price of any of the market makers for such security as
reported in the "pink sheets" by the National Quotation Bureau, Inc. If
the VWAP cannot be calculated for such security on such date on any of the
foregoing bases, the VWAP of such security on such date shall be the fair
market value as mutually determined by the Company and the Holders of the
Securities representing a majority of the aggregate principal amount of
the Securities outstanding. All such determinations to be appropriately
adjusted for any stock dividend, stock split, stock combination or other
similar transaction during such period.
Warrant Agreement: As defined in the recitals hereto.
Warrants: Warrants to purchase Common Stock of the Company issued in
accordance with the Warrant Agreement.
Warrant Shares: The shares of Common Stock issuable to the Holders of
Warrants upon the exercise of any Warrant, together with any other
securities that may in the future become issuable upon exercising the
Warrants.
2. Shelf Registration. (a) The Issuer shall use its best efforts
to:
(i) not later than the date that is 90 days after the date (the
"Registration Trigger Date") of the consummation of a "plan of
reorganization" under the Bankruptcy Code with respect to PG&E, cause
to be filed a registration statement pursuant to Rule 415 under the
Securities Act (together with any amendments thereto, the "Shelf
Registration Statement"), which Shelf Registration Statement shall
provide for resales of all Transfer Restricted Securities held by
Holders that have provided the information required pursuant to the
terms of Section 2(b) hereof;
(ii) cause the Shelf Registration Statement to be declared
effective by the Commission not later than 180 days after the
Registration Trigger Date (the "Effectiveness Target Date"); and
(iii) keep the Shelf Registration Statement continuously
effective, supplemented and amended as required by the provisions of
Section 6(b) hereof to the extent necessary to ensure that (A) it is
available for resales by the Holders of Transfer Restricted
Securities entitled to the benefit of this Agreement and (B) conforms
with the requirements of this Agreement and the Securities Act for a
period (the "Effectiveness Period") of:
(1) two years following the date of original issuance of
the Warrants; or
(2) such shorter period that will terminate when (x) all of
the Holders of Transfer Restricted Securities are able to sell
all Transfer Restricted Securities immediately without
restriction pursuant to Rule 144(k) under the Securities Act or
any successor rule thereto, (y) all Transfer Restricted
Securities have ceased to be outstanding (whether as a
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result of repurchase and cancellation, conversion or otherwise)
or (z) all Transfer Restricted Securities have been registered
under the Shelf Registration Statement and have been sold in
accordance therewith.
(b) No Holder of Transfer Restricted Securities shall be permitted
to include any of its Transfer Restricted Securities in the Shelf Registration
Statement pursuant to this Agreement unless such Holder completes a Selling
Securityholder Notice and Questionnaire, substantially in the form attached
hereto as Exhibit A (with such amendments or modifications as the Issuer may
deem necessary to reflect the circumstances of the proposed registration) (the
"Questionnaire"), and delivers it to the Issuer prior to or on the 15th Business
Day after such Holder's receipt of the Questionnaire by the Issuer in writing
(such deadline, the "Questionnaire Deadline"). Prior to such time, each Holder
may complete the Questionnaire and deliver it to the Issuer prior to such
request and, as a result, shall be entitled to have its Transfer Restricted
Securities included in the initial Shelf Registration Statement filed with the
Commission. In addition, upon receipt of one or more written requests for
additional information from the Issuer, each Holder who intends to be named as a
selling securityholder in the Shelf Registration Statement shall furnish to the
Issuer in writing, within 15 Business Days after such Holder's receipt of such
request, such additional information regarding such Holder and the proposed
distribution by such Holder of its Transfer Restricted Securities, in connection
with the Shelf Registration Statement or Prospectus or Preliminary Prospectus
included therein and in any application to be filed with or under state
securities law, as the Issuer may reasonably request. No Holder of Transfer
Restricted Securities shall be entitled to Liquidated Damages pursuant to
Section 3 hereof unless such Holder shall have provided all such reasonably
requested information prior to or on the Questionnaire Deadline. Each Holder
whose Transfer Restricted Securities are being registered pursuant to the Shelf
Registration Statement agrees to furnish promptly to the Issuer all information
required to be disclosed in order to make information previously furnished to
the Issuer by such Holder not materially misleading.
3. Liquidated Damages.
(a) If:
(i) the Shelf Registration Statement has not been declared
effective by the Commission on or prior to the Effectiveness Target
Date; or
(ii) except as provided in Section 6(b)(i) hereof, the Shelf
Registration Statement is filed and declared effective but, during
the Effectiveness Period, shall thereafter cease to be effective or
fail to be usable for its intended purpose without there being
filed with the Commission within ten Business Days a post-effective
amendment to the Shelf Registration Statement, a supplement to the
Prospectus or a report filed pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act that cures such failure and, in the
case of a post-effective amendment, is itself immediately declared
effective;
(each such event referred to in foregoing clauses (i) and (ii), a
"Registration Default"), the Issuer hereby agrees, subject to Section 2(b), to
pay liquidated damages ("Liquidated Dmages") with respect to the Transfer
Restricted Securities on a monthly basis in
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an amount such that, each Warrant shall evidence the right to receive upon
payment of the Exercise Price that number of shares of Common Stock (calculated
to the nearest ten millionth) obtained from the following formula:
N' = N x 1.005
Where:
N' = the adjusted number of Warrant Shares issuable upon the
exercise of a Warrant by payment of the Exercise Price (as
defined in the Warrant Agreement).
N = the number of Warrant Shares previously issuable upon the
exercise of a Warrant by payment of the Exercise Price prior
to adjustment.
To the extent that any Warrants have been previously exercised
and Warrant Shares (to the extent that such Warrant Shares are Transfer
Restricted Securities) have been issued to a Holder upon such exercise, the
Holder of such Warrant Shares shall be entitled to receive additional Warrants
Shares in an amount equal to the product of (i) the number of Warrant Shares
held by such Holder at the beginning of each month upon which liquidated damages
shall be payable and (ii) 0.005.
The adjustments made pursuant to this Section shall be made on
a monthly basis beginning on and including the day following the Registration
Default to but excluding the day on which the Registration Default has been
cured. Following the cure of all Registration Defaults relating to any
particular Transfer Restricted Security, the accrual of Liquidated Damages with
respect to such Transfer Restricted Security will cease; provided, however,
that, in any event, Liquidated Damages shall cease to accrue on the last day of
the Effectiveness Period. Except as provided in 8, no Holder of Transfer
Restricted Securities shall be entitled to any damages for a Registration
Default beyond the Liquidated Damages provided for herein.
The Liquidated Damages set forth above shall be the exclusive
monetary remedy available to the Holders of Transfer Restricted Securities for
such Registration Default.
4. Piggy-Back Registration Rights
(a) If the Issuer at any time proposes to file a registration
statement under the Securities Act with respect to any Underwritten Offering by
the Issuer for its own account or for the account of holders of any Common
Stock, Convertible Securities or Common Stock Equivalent to be offered for cash
(other than on Form S-4 or S-8) ("Other Holders") then the Issuer shall in each
case give written notice (a "Piggy-Back Registration Offer") of such proposed
filing to the Holders at least 20 days before the anticipated filing date, and
such notice shall offer such Holders the opportunity to include Transfer
Restricted Securities held by them in such registration statement (a "Piggy-Back
Registration") pursuant to the provisions set forth below. In such event the
right of any Holder to registration pursuant to this Section 4(a), may be
conditioned upon such Holder's participation in such underwriting and of the
inclusion of such Holder's Transfer Restricted Securities in the underwriting to
the extent provided herein. If any such Holder desires to have Transfer
Restricted Securities registered and included in such Underwritten Offering
under this Section 4(a) such Holder shall so notify the Issuer in writing
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within ten days after the receipt by such Holder of the written notice
provided for in the preceding sentence (which notification shall set forth the
amount of Transfer Restricted Securities for which registration is requested),
and the Issuer will use its best efforts to cause all such Transfer Restricted
Securities to be registered under the Securities Act to the extent required to
permit the disposition in such Underwritten Offering; provided, however, that if
the managing underwriter or underwriters of such offering, as selected by the
Issuer, shall advise the Issuer in writing that in its or their opinion the
total amount or kind of securities that the Holders, the Issuer and any other
Persons or entities intend to include in such offering exceeds the amount that
can be sold in such offering without an adverse effect on the price, timing or
distribution of the securities offered by the Issuer, the Issuer shall be
required to include in such registration only the amount of Transfer Restricted
Securities and securities of other persons or entities, if any, that the
managing underwriter or underwriters determine, in its or their sole discretion,
can be sold without an adverse effect on the price, timing or distribution of
the securities offered. In such event, (x) in cases initially involving the
registration for sale of securities for the Issuer's own account, securities
shall be registered in such offering in the following order of priority: (i)
first, the securities which the Issuer proposes to register and (ii) second, the
securities which may have been requested to be included in such registration
pursuant to this Agreement and the securities of other Persons entitled to
exercise "piggy-back" registration rights pursuant to contractual commitments of
the Issuer (pro rata based on the amount of securities sought to be registered
by such Persons) (y) in cases initially involving the registration for sale of
securities for the account of any Other Holders, securities shall be registered
in such offering in the following order of priority: (i) first, the securities
which such Other Holders propose to register, (ii) second, the securities which
may have been requested to be included in such registration pursuant to this
Agreement and the securities of other Persons entitled to exercise "piggy-back"
registration rights pursuant to contractual commitments of the Issuer (pro rata
based on the amount of securities sought to be registered by such Persons) and
(iii) third, the securities which Issuer proposes to register.
(b) At any time prior to the date of printing preliminary
prospectuses in connection with an Underwritten Offering under Section 4(a), a
Holder that previously requested Piggy-Back Registration thereof may withdraw
all or part of its Transfer Restricted Securities from such offering by
providing notice to such effect to the Issuer.
5. Underwriting Procedures
(a) If the Required Holders so request in writing (a
"Registration Request"), the Issuer shall effect pursuant to the Shelf
Registration Statement an Underwritten Offering by giving written notice (an
"Underwritten Offering Notice") of the proposed Underwritten Offering to all
Holders within 15 calendar days after receipt of a valid Registration Request.
Such notice shall offer the Holders the opportunity to include in such
Underwritten Offering such amount of Transfer Restricted Securities as each
Holder may request. The Issuer shall include in such Underwritten Offering all
Transfer Restricted Securities for which the Issuer has received written
requests for inclusion within 15 calendar days after delivery of the
Underwritten Offering Notice, subject to Section 5(b).
(b) The Issuer shall cause the managing underwriter or
underwriters of a proposed Underwritten Offering to permit the Holders that have
requested Transfer Restricted
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Securities to be included in an Underwritten Offering undertaken pursuant to
Section 5(a) above to include all such Transfer Restricted Securities on the
same terms and conditions as all other Transfer Restricted Securities to be
included. Notwithstanding the foregoing, if the managing underwriter or
underwriters of such Underwritten Offering advises the Issuer and the selling
Holders that the total amount of Transfer Restricted Securities that such
Holders propose to include in such Underwritten Offering is such as to
materially and adversely affect the success of such Underwritten Offering, then
the Issuer shall include in such Underwritten Offering up to the full amount of
Transfer Restricted Securities requested to be included in such Underwritten
Offering by the Holders (allocated pro rata among the Holders on the basis of
the amount of Transfer Restricted Securities initially requested to be included
therein by each such Holder) so that the total amount of Transfer Restricted
Securities to be included in such Underwritten Offering is the full amount that,
in the written opinion of such managing underwriter or underwriters, can be sold
without materially and adversely affecting the success of such Underwritten
Offering.
(c) Any Transfer Restricted Securities may be withdrawn from
a proposed Underwritten Offering at any time before the execution and delivery
by such Holder of the underwriting agreement relating to such Underwritten
Offering.
(d) The managing underwriter or underwriters of the
Underwritten Offering relating thereto shall be selected by the Required Holders
whose Transfer Restricted Securities are included in such offering, subject to
the approval of the Issuer.
6. Registration Procedures.
(a) In connection with the Shelf Registration Statement, the
Issuer shall comply with all the provisions of Section 6(b) hereof and shall use
its best efforts to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method or
methods of distribution thereof, and pursuant thereto, shall as expeditiously as
possible prepare and file with the Commission a Shelf Registration Statement
relating to the registration on any appropriate form under the Securities Act.
(b) In connection with the Shelf Registration Statement and
any Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities, the Issuer shall:
(ii) subject to any notice by the Issuer in accordance
with this Section 6(b) of the existence of any fact or event
of the kind described in Section 6(b)(iii)(D), use its best
efforts to keep the Shelf Registration Statement continuously
effective during the Effectiveness Period; upon the occurrence
of any event that would cause the Shelf Registration Statement
or the Prospectus contained therein (A) to contain a material
misstatement or omission or (B) not be effective and usable
for resale of Transfer Restricted Securities during the
Effectiveness Period, the Issuer shall file promptly an
appropriate amendment to the Shelf Registration Statement, a
supplement to the Prospectus or a report filed with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act, in the case of clause (A), correcting any
such misstatement or
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omission, and, in the case of either clause (A) or (B), use its
best efforts to cause such amendment to be declared effective and
the Shelf Registration Statement and the related Prospectus to
become usable for their intended purposes as soon as practicable
thereafter. Notwithstanding the foregoing, the Issuer may suspend
the effectiveness of the Shelf Registration Statement by written
notice to the Holders for a period (each such period, a
"Suspension Period"); provided that the Company shall promptly
notify the Holders in writing of the date the Suspension Period
will begin and the expected duration of such period; and provided
further, that no Suspension Period shall exceed 45 consecutive
days and all such Suspension Periods shall not exceed an
aggregate of 90 days within any consecutive twelve-month period
if:
(x) an event occurs and is continuing as a
result of which the Shelf Registration Statement
would, in the Issuer's reasonable judgment, contain
an untrue statement of a material fact or omit to
state a material fact required to be stated therein
or necessary to make the statements therein not
misleading; and
(y) the Issuer reasonably determines that
the disclosure of such event at such time would have
a material adverse effect on the business of the
Issuer (and its subsidiaries, if any, taken as a
whole);
Notwithstanding the foregoing, in the event that any Holder has,
prior to the receipt of notice of the commencement of a
Suspension Period, entered into a binding contract to sell any
Warrant Shares pursuant to the Shelf Registration Statement, and
in accordance with the plan of distribution therein, the Issuer
agrees not to prevent its transfer agent from delivering such
Warrant to the purchaser thereof in accordance with the
applicable requirements of the Warrant Agreement. The Issuer
shall use its commercially reasonable efforts to provide any
information reasonably requested by the transfer agent in
connection with any such sale.
(ii) Prepare and file with the Commission such
amendments (including post-effective amendments) and supplements
to the Shelf Registration Statement as may be necessary to keep
the Shelf Registration Statement continuously effective during
the Effectiveness Period; cause the Prospectus to be supplemented
by any required Prospectus supplement, and as so supplemented to
be filed pursuant to Rule 424 (or any similar provisions then in
force) under the Securities Act, and to comply fully with the
applicable provisions of Rules 424 and 430A under the Securities
Act in a timely manner; and comply with the provisions of the
Securities Act and the Exchange Act with respect to the
disposition of all securities covered by the Shelf Registration
Statement during the applicable period in accordance with the
intended method or methods of distribution by the sellers thereof
set forth in the Shelf Registration Statement as so amended or in
such Prospectus as so supplemented.
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(iii) Advise the underwriter(s), if any, and selling Holders
promptly (but in any event within five Business Days) and, if
requested by such Persons, to confirm such advice in writing:
(A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to the
Shelf Registration Statement or any post-effective amendment
thereto, when the same has become effective,
(B) of any request by the Commission for amendments to the
Shelf Registration Statement or amendments or supplements to the
Prospectus or for additional information relating thereto,
(C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Shelf Registration Statement
under the Securities Act or any notification with respect to the
suspension by any state securities commission of the
qualification or exemption from qualification of any of the
Transfer Restricted Securities for offering or sale in any
jurisdiction, or the initiation or threatening of any proceeding
for any of the preceding purposes, or
(D) of the existence of any fact or the happening of any
event (the nature of which need not be disclosed), during the
Effectiveness Period, that makes any statement of a material fact
made in the Shelf Registration Statement, the Prospectus, any
amendment or supplement thereto, or any document incorporated by
reference therein untrue, or that requires the making of any
additions to or changes in the Shelf Registration Statement or
the Prospectus in order to make the statements therein not
misleading, and that in the case of a Prospectus, it will not
contain any 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.
Each Holder of Warrants, by accepting the same, agrees to hold any
communication from the Company pursuant to this Section 6(b)(iii) in
confidence.
If at any time the Commission shall issue any stop order suspending
the effectiveness of the Shelf Registration Statement, or any state
securities commission or other regulatory authority shall issue an
order suspending the qualification or exemption from qualification of
the Transfer Restricted Securities under state securities or Blue Sky
laws, the Issuer shall use its best efforts to obtain the withdrawal
or lifting of such order at the earliest possible time and will
provide to the Purchasers and each Holder who is named in the Shelf
Registration Statement prompt notice of the withdrawal of any such
order.
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(iv) Furnish to each of the selling Holders and each of the
underwriter(s), if any, before filing with the Commission, one
copy of the Shelf Registration Statement and copies of any
Prospectus included therein or any amendments or supplements to
the Shelf Registration Statement or Prospectus (other than
documents incorporated by reference after the initial filing of
the Shelf Registration Statement), which documents will be
subject to the review of such Holders and underwriter(s), if any,
for a period of at least ten Business Days (in the case of the
Shelf Registration Statement and the initial Prospectus contained
therein) and two Business Days (in the case of any amendment or
supplement thereto), and the Issuer will not file the Shelf
Registration Statement or initial Prospectus or any amendment or
supplement to the Shelf Registration Statement or Prospectus
(other than documents incorporated by reference) to which a
selling Holder of Transfer Restricted Securities covered by the
Shelf Registration Statement or the underwriter(s), if any, shall
reasonably object within ten Business Days prior to the filing of
the Shelf Registration Statement and Prospectus and within two
Business Days prior to the filing of any amendment or supplement
thereto. A selling Holder or underwriter, if any, shall be deemed
to have reasonably objected to such filing only if the Shelf
Registration Statement, amendment, Prospectus or supplement, as
applicable, as proposed to be filed, contains a material
misstatement or omission with respect to the information
concerning such Holder or its intended plan of distribution with
respect to the Transfer Restricted Securities.
(v) Make available at reasonable times for inspection by
one or more representatives of the selling Holders, designated in
writing by the Required Holders whose Transfer Restricted
Securities are included in the Shelf Registration Statement, any
underwriter participating in any distribution pursuant to the
Shelf Registration Statement, and any attorney or accountant
retained by such selling Holders or any of the underwriter(s),
all financial and other records, pertinent corporate documents
and properties of the Issuer as shall be reasonably necessary to
enable them to exercise any applicable due diligence
responsibilities, and cause the Issuer's officers, directors,
managers and employees to supply all information reasonably
requested by any such representative or representatives of the
selling Holders, underwriter, attorney or accountant in
connection with the Shelf Registration Statement after the filing
thereof and before its effectiveness, provided, however, that any
information designated by the Issuer as confidential at the time
of delivery of such information shall be kept confidential by the
recipient thereof.
(vi) If reasonably requested by any selling Holders or the
underwriter(s), if any, promptly incorporate in the Shelf
Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as such
selling Holders and underwriter(s), if any, may reasonably
request to have included therein, including, without limitation:
(1) information relating to the "Plan of Distribution" of the
Transfer Restricted Securities, (2) information with respect the
number of Transfer Restricted Securities being sold to such
underwriter(s), (3) the purchase price being paid
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therefor and (4) any other terms of the offering of the
Transfer Restricted Securities to be sold in such offering;
provided, however, that with respect to any information
requested for inclusion by a selling Holder, this clause
(vi) shall apply only to such information that relates to
the Transfer Restricted Securities to be sold by such
selling Holder; and make all required filings of such
Prospectus supplement or post-effective amendment as soon as
reasonably practicable after the Issuer is notified of the
matters to be incorporated in such Prospectus supplement or
post-effective amendment.
(vii) Deliver to each selling Holder and each of the
underwriter(s), if any, without charge, upon the
effectiveness of the Shelf Registration Statement, as many
copies of the Prospectus (including each preliminary
prospectus) and any amendment or supplement thereto as such
Persons reasonably may request; subject to any notice by the
Issuer in accordance with this Section 6(b) of the existence
of any fact or event of the kind described in Section
6(b)(iii) (D), the Issuer hereby consents to the use of the
Prospectus and any amendment or supplement thereto by each
of the selling Holders and each of the underwriter(s), if
any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or
any amendment or supplement thereto.
(viii) The Issuer shall:
(A) upon request, furnish to each selling Holder and
each underwriter in the case of an underwritten registration
where an underwriting agreement is entered into, if any, in
such substance and scope as they may reasonably request and
as are customarily made by issuers to underwriters in
primary underwritten offerings for selling security holders,
upon the date of closing of any sale of Transfer Restricted
Securities in an Underwritten Registration:
(1) opinions, each dated the date of such
closing, of counsel to the Issuer covering such of the
matters as are customarily covered in legal opinions to
underwriters in connection with underwritten offerings
of securities; and
(2) customary comfort letters, dated the date of
such closing, from the Issuer's independent accountants
(and from any other accountants whose report is
contained or incorporated by reference in the Shelf
Registration Statement) in the customary form and
covering matters of the type customarily covered in
comfort letters to underwriters in connection with
underwritten offerings of securities;
(B) set forth in full in the underwriting agreement,
if any, indemnification provisions and procedures which
provide rights no less protective than those set forth in
Section 6 hereof with respect to all parties to be
indemnified by the Issuer; and
13
(C) deliver such other documents and certificates as
may be reasonably requested by such parties to evidence
compliance with clause (A) above and with any customary
conditions contained in the underwriting agreement or other
agreement entered into by the selling Holders pursuant to
this clause (ix).
(ix) Before any public offering of Transfer Restricted
Securities, cooperate with the selling Holders, the
underwriter(s), if any, and their respective counsel in
connection with the registration and qualification of the
Transfer Restricted Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions in the
United States as the selling Holders or underwriter(s), if
any, may reasonably request, use best efforts to keep each
such registration or qualification (or exemption therefrom)
effective during the Effectiveness Period and do any and all
other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Transfer Restricted
Securities covered by the Shelf Registration Statement;
provided, however, that the Issuer shall not be required (A)
to register or qualify as a foreign corporation or a dealer
of securities where it is not now so qualified or to take
any action that would subject it to the service of process
in any jurisdiction where it is not now so subject or (B) to
subject itself to taxation in any such jurisdiction if it is
not now so subject.
(x) Cooperate with the selling Holders and the
underwriter(s), if any, to facilitate the timely preparation
and delivery of certificates representing Transfer
Restricted Securities to be sold and not bearing any
restrictive legends (unless required by applicable
securities laws); and enable such Transfer Restricted
Securities to be in such denominations and registered in
such names as the Holders or the underwriter(s), if any, may
request at least two Business Days before any sale of
Transfer Restricted Securities made by such selling Holders
or underwriter(s).
(xi) Use its best efforts to cause the Transfer
Restricted Securities covered by the Shelf Registration
Statement to be registered with or approved by such other
U.S. governmental agencies or authorities as may be
necessary to enable the selling Holders or the
underwriter(s), if any, to consummate the disposition of
such Transfer Restricted Securities pursuant to the Shelf
Registration Statement.
(xii) Subject to Section 6(b)(i) hereof, if any fact or
event contemplated by Section 6(b)(iii)(D) hereof shall
exist or have occurred, use its best efforts to prepare a
supplement or post-effective amendment to the Shelf
Registration Statement or related Prospectus or any document
incorporated therein by reference or file any other required
document so that, as thereafter delivered to any purchasers
of Transfer Restricted Securities, the Prospectus will not
contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading.
14
(xiii) Provide CUSIP numbers for all Transfer Restricted
Securities not later than the effective date of the Shelf Registration
Statement and provide the transfer agent with printed certificates for
the Transfer Restricted Securities that are in a form eligible for
deposit with The Depository Trust Company.
(xiv) Cooperate and assist in any filings required to be made
with the NASD and in the performance of any due diligence
investigation by any underwriter that is required to be retained in
accordance with the rules and regulations of the NASD.
(xv) Otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission and all reporting
requirements under the Exchange Act.
(xvi) Cause all Transfer Restricted Securities covered by the
Shelf Registration Statement to be listed or quoted, as the case may
be, on each securities exchange or automated quotation system on which
similar securities issued by the Issuer are then listed or quoted and
if not so listed, to be listed on the NASD automated quotation system.
(xvii) Provide to each Holder upon written request each document
filed with the Commission pursuant to the requirements of Section 13
and Section 15 of the Exchange Act after the effective date of the
Shelf Registration Statement.
(xviii) If reasonably requested by the underwriters, make
appropriate officers of the Issuer available to the underwriters for
meetings with prospective purchasers of the Transfer Restricted
Securities and prepare and present to potential investors customary
"road show" or marketing materials in a manner consistent with other
new issuances of other securities similar to the Transfer Restricted
Securities; but in no event more than once in any 12 month period.
(c) Each Holder agrees by acquisition of a Transfer Restricted
Security that, upon receipt of any notice (a "Suspension Notice") from the
Issuer of the existence of any fact of the kind described in Section
6(b)(iii)(D) hereof, such Holder will, and will use its reasonable best efforts
to cause any underwriter(s) in an Underwritten Offering to, forthwith
discontinue disposition of Transfer Restricted Securities pursuant to the Shelf
Registration Statement until:
(i) such Holder has received copies of the supplemented or
amended Prospectus contemplated by Section 6(b)(xii) hereof; or
(ii) such Holder is advised in writing by the Issuer that the use
of the Prospectus may be resumed, and has received copies of any
additional or supplemental filings that are incorporated by reference
in the Prospectus.
If so directed by the Issuer, each Holder will deliver to the Issuer (at the
Issuer's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice of suspension.
15
7. Registration Expenses. All expenses incident to the Issuer's
performance of or compliance with this Agreement shall be borne by the Issuer
regardless of whether a Shelf Registration Statement becomes effective,
including, without limitation:
(i) all registration and filing fees and expenses (including
filings made by the Purchasers or Holders with the NASD);
(ii) all fees and expenses of compliance with federal securities
and state Blue Sky or securities laws;
(iii) all expenses of printing (including printing of
Prospectuses and certificates for the Warrant Shares) and the Issuer's
expenses for messenger and delivery services and telephone;
(iv) all fees and disbursements of counsel to the Issuer and,
subject to Section 5(b) below, the Holders of Transfer Restricted
Securities;
(v) all application and filing fees in connection with listing
(or authorizing for quotation) the Common Stock on a national
securities exchange or automated quotation system pursuant to the
requirements hereof; and
(vi) all fees and disbursements of independent certified public
accountants of the Issuer (including the expenses of any special audit
and comfort letters required by or incident to such performance).
The Issuer shall bear its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal, accounting or other duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by the
Issuer.
(b) In connection with the Shelf Registration Statement required by
this Agreement, including any amendment or supplement thereto, and any other
documents delivered to any Holders, the Issuer shall reimburse the Purchasers
and the Holders of Transfer Restricted Securities being registered pursuant to
the Shelf Registration Statement, as applicable, for the reasonable fees and
disbursements not to exceed $50,000, of not more than one counsel, which shall
be such counsel as may be chosen by a Majority of Holders for whose benefit the
Shelf Registration Statement is being prepared.
8. Indemnification and Contribution. The Issuer shall indemnify and
hold harmless each Holder, such Holder's officers, directors and employees and
each person, if any, who controls such Holder within the meaning of the
Securities Act (each, an "Indemnified Holder"), from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to resales of the Transfer Restricted Securities) ("Liabilities"), to
which such Indemnified Holder may become subject, insofar as any such loss,
claim, damage, liability or action arises out of, or is based upon:
16
(i) any untrue statement or alleged untrue statement of a material
fact contained in (A) the Shelf Registration Statement or Prospectus or any
amendment or supplement thereto or (B) any blue sky application or other
document or any amendment or supplement thereto prepared or executed by the
Issuer (or based upon written information furnished by or on behalf of the
Issuer expressly for use in such blue sky application or other document or
amendment on supplement) filed in any jurisdiction specifically for the
purpose of qualifying any or all of the Transfer Restricted Securities
under the securities law of any state or other jurisdiction (such
application or document being hereinafter called a "Blue Sky Application");
or
(ii) the omission or alleged omission to state therein any material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading,
and shall reimburse each Indemnified Holder promptly upon demand for any legal
or other expenses reasonably incurred by such Indemnified Holder in connection
with investigating or defending or preparing to defend against any such
Liability as such expenses are incurred; provided, however, that the Issuer
shall not be liable to a Holder in any such case to the extent that any such
Liability arises out of, or is based upon, any untrue statement or alleged
untrue statement or omission or alleged omission made in the Shelf Registration
Statement or Prospectus or amendment or supplement thereto or Blue Sky
Application in reliance upon and in conformity with written information
furnished to the Issuer by such Holder specifically for use therein; and
provided, further, however, that the Issuer shall not be liable to the
underwriter for any Holder or, in the case of any non-underwritten offering, to
any Holder or its related Indemnified Holder to the extent that (A) such
Liability arises out of or is based upon an untrue statement or omission made in
any preliminary prospectus if (i) such underwriter or Holder, as applicable,
failed to send or deliver a copy of the final prospectus with or prior to the
delivery of written confirmation of the sale by such Holder to the Person
asserting the claim from which such Liabilities arise, to the extent such
underwriter or Holder, as applicable, was required to send and deliver such
final prospectus, and (ii) the final prospectus would have corrected such untrue
statement or such omission; or (B) such Liability arises out of or is based upon
an untrue statement or omission in any such prospectus if (x) such untrue
statement or omission is corrected in an amendment or supplement to such
prospectus, and (y) having previously been furnished by or on behalf of the
Issuer with copies of such prospectus as so amended or supplemented, such
underwriter or Holder, as applicable, thereafter fails to deliver such
prospectus as so amended or supplemented prior to or concurrently with the sale
of a Security to the Person asserting the claim from which such Liability
arises. The foregoing indemnity agreement is in addition to any liability which
the Issuer may otherwise have to any Indemnified Holder. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of the Holder and shall survive the transfer of the Transfer Restricted
Securities by such Holder.
(b) Each Holder, severally and not jointly, shall indemnify and hold
harmless the Issuer, its officers, directors and employees and each person, if
any, who controls the Issuer within the meaning of the Securities Act, from and
against any Liability, in respect thereof, to which the Issuer or any such
officer, director, employee or controlling person may become
17
subject, insofar as any such loss, claim, damage or liability or action arises
out of, or is based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in the Shelf Registration Statement or
Prospectus or any amendment or supplement thereto or any Blue Sky
Application; or
(ii) the omission or the alleged omission to state therein any
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading,
but in each case only to the extent that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Issuer by or on behalf of
such Holder (or its related Indemnified Holder) specifically for use therein,
and shall reimburse the Issuer and any such director, officer, employee or
controlling person promptly upon demand for any legal or other expenses
reasonably incurred by the Issuer or any such director, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such Liability as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability which any Holder may
otherwise have to the Issuer or any of its directors, officers, employees or
controlling persons and any such director, officer, employee or controlling
person. Notwithstanding anything to the contrary contained herein, no Holder
shall be liable under this Section 8(b) for any amount in excess of the net
proceeds to such Holder as a result of the sale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement or Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 8 except to the extent it has
been materially prejudiced by such failure and, provided, further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 8.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that a
Majority of Holders shall have the right to employ a single counsel to represent
jointly a Majority of Holders and their respective officers, employees and
controlling persons who may be subject to liability arising out of any claim in
respect of which indemnity may be sought by a Majority of Holders against the
Issuer or any of its directors, officers, employees or controlling persons under
this Section 8; and, provided, further, that if a Majority of Holders shall have
reasonably concluded that there may be one or more legal defenses available to
them
18
and their respective officers, employees and controlling persons that are
different from or additional to those available to the Issuer and its officers,
directors, employees and controlling persons, the fees and expenses of a single
separate counsel shall be paid by the Issuer. No indemnifying party shall:
(i) without the prior written consent of the indemnified parties
(which consent shall not be unreasonably withheld) 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 are 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, or
(ii) be liable for any settlement of any such action effected
without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the indemnifying
party agrees to indemnify and hold harmless any indemnified party from
and against any loss or liability by reason of such settlement or
judgment.
(d) If the indemnification provided for in this Section 8 shall for
any reason be unavailable or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any Liability referred to therein, then
the indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such Liability in such proportion as is appropriate to reflect fault of such
Person and the indemnifying party, as well as other relevant equitable concerns.
The relative fault of the parties shall be determined by reference to 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
Issuer on the one hand or the Holders on the other, the intent of the parties
and their relative knowledge, access to information and opportunity to correct
or prevent such statement or omission. The Issuer and each Holder agree that it
would not be just and equitable if the amount of contribution pursuant to this
Section 8(d) were determined by pro rata allocation or by any other method of
allocation that does not take into account the equitable considerations referred
to in the first sentence of this paragraph (d). The amount paid or payable by an
indemnified party as a result of the Liability referred to above in this Section
8 shall be deemed to include, for purposes of this Section 8, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending or preparing to defend any such action or claim.
Notwithstanding the provisions of this Section 8, no Holder shall be required to
contribute any amount in excess of the amount by which the total price at which
the Transfer Restricted Securities purchased by it were resold exceeds the
amount of any damages which such Holder has otherwise been required to pay by
reason of any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The Holders'
obligations to contribute as provided in this Section 8(d) are several and not
joint.
19
9. Rule 144. The Issuer shall file the reports required to be
filed by it under the Securities Act and the Exchange Act in a timely manner
and, if at any time the Issuer is not required to file such reports, it will,
upon written request of any Holder of Transfer Restricted Securities, make
publicly available other information so long as necessary to permit sales of
their securities pursuant to Rules 144. The Issuer covenants that it will take
such further action as any Holder of Transfer Restricted Securities may
reasonably request, all to the extent required from time to time to enable such
Holder to sell such Transfer Restricted Securities without registration under
the Securities Act within the limitation of the exemptions provided by Rules
144. The Issuer will provide a copy of this Agreement to prospective purchasers
of Transfer Restricted Securities identified to the Issuer by any purchasers
upon request by any Purchaser. Upon the request of any Holder of Transfer
Restricted Securities, the Issuer shall deliver to such Holder a written
statement as to whether it has complied with such requirements. Notwithstanding
the foregoing, nothing in this Section 9 shall be deemed to require the Issuer
to register any of its securities pursuant to the Exchange Act.
10. Participation in Underwritten Registrations. No Holder may
participate in any Underwritten Registration hereunder unless such Holder:
(i) agrees to sell such Holder's Transfer Restricted Securities on
the basis provided in any underwriting arrangements approved by the
Persons entitled hereunder to approve such arrangements; and
(ii) completes and executes all reasonable questionnaires, powers
of attorney, indemnities, underwriting agreements, lock-up letters and
other documents required under the terms of such underwriting
arrangements.
11. Purchase By Issuer. Neither the Issuer nor any of its
affiliates (as defined in Rule 144) shall resell any Warrants purchased by such
Person to any other Person other than to the Issuer or any of its affiliates.
12. Miscellaneous.
(a) Remedies. The Issuer acknowledges and agrees that any failure
by the Issuer to comply with its obligations under Section 2 hereof may result
in material irreparable injury to the Purchasers or the Holders for which there
is no adequate remedy at law, that it will not be possible to measure damages
for such injuries precisely and that, in the event of any such failure, the
Purchasers or any Holder may obtain such relief as may be required to
specifically enforce the Issuer's obligations under Section 2 hereof. The Issuer
further agrees to waive the defense in any action for specific performance that
a remedy at law would be adequate.
(b) Adjustments Affecting Transfer Restricted Securities. The
Issuer shall not, directly or indirectly, take any action with respect to the
Transfer Restricted Securities as a class that would adversely affect the
ability of the Holders of Transfer Restricted Securities to include such
Transfer Restricted Securities in a registration undertaken pursuant to this
Agreement.
(c) No Inconsistent Agreements. The Issuer will not, on or after
the date of this Agreement, enter into any agreement with respect to its
securities that is inconsistent with
20
the rights granted to the Holders in this Agreement or otherwise conflicts with
the provisions hereof. In addition, the Issuer shall not grant to any of its
security holders (other than the Holders of Transfer Restricted Securities in
such capacity) the right to include any of its securities in the Shelf
Registration Statement provided for in this Agreement other than the Transfer
Restricted Securities. The Issuer has not previously entered into any agreement
(which has not expired or been terminated) granting any registration rights with
respect to its securities to any Person which rights conflict with the
provisions hereof. Notwithstanding the provisions of this Section 12(c), the
Holders agree that the Resale Registration Rights Agreement between the Issuer
and the purchasers identified on the signature pages thereto, dated as of the
date hereof, is not inconsistent with or otherwise in conflict with the
provisions hereof and that the provisions of Section 4 hereof shall not apply to
any registrations undertaken pursuant to the provisions thereof.
(d) Amendments and Waivers. This Agreement may not be amended,
modified or supplemented, and waivers or consents to or departures from the
provisions hereof may not be given, unless the Issuer has obtained the written
consent of a Majority of Holders.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, facsimile
transmission, or air courier guaranteeing overnight delivery:
(i) if to a Holder, at the last address provided by such
Holder to the Company (in the case of Holders of Warrants) or
the transfer agent of the Common Stock (in the case of Holders
of Warrant Shares) and
(ii) if to the Issuer:
PG&E Corporation
One Market, Xxxxx Xxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Assistant Treasurer
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
With copies to:
PG&E Corporation
One Market, Xxxxx Xxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Chief Counsel - Corporate
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
21
and
Xxxxxx & Xxxxxxx
000 Xxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxx Xxxxxx
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged, if transmitted by
facsimile; and on the next Business Day, if timely delivered to an air courier
guaranteeing overnight delivery.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Securities; provided,
however, that (i) this Agreement shall not inure to the benefit of or be binding
upon a successor or assign of a Holder unless and to the extent such successor
or assign acquired Transfer Restricted Securities from such Holder in compliance
with any restrictions on transfer applicable thereto and (ii) nothing contained
herein shall be deemed to permit any assignment, transfer or other disposition
of Transfer Restricted Securities in violation of the terms of the Warrant
Agreement. If any transferee of any Holder shall acquire Transfer Restricted
Securities, in any manner, whether by operation of law or otherwise, such
Transfer Restricted Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Transfer Restricted Securities such
person shall be conclusively deemed to have agreed to be bound by and to perform
all of the terms and provisions of this Agreement. The Issuer hereby agrees to
extend the benefits of this Agreement to subsequent Holders of Transfer
Restricted Securities who execute a counterpart signature page hereto.
(g) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement; provided that a facsimile
signature shall be considered due execution and shall be binding upon the
signatory thereto with the same force and effect as if the signature were an
original, not a facsimile signature.
(h) Securities Held by the Issuer or Its Affiliates. Whenever
the consent or approval of Holders of a specified percentage of Transfer
Restricted Securities is required hereunder, Transfer Restricted Securities held
by the Issuer or its "affiliates" (as such term is defined in Rule 405 under the
Securities Act) (other than the Purchasers or subsequent Holder of Transfer
Restricted Securities if such subsequent Holders are deemed to be affiliates
solely by reason of their holdings of such Transfer Restricted Securities) shall
not be counted in determining whether such consent or approval was given by the
Holders of such required percentage.
22
(i) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(j) Governing Law. This Agreement shall be governed by, and
construed in accordance with, the law of the State of New York.
(k) Severability. If any one or more of the provisions
contained herein, or the application thereof in any circumstance, 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 contained herein shall not be affected or impaired or
invalidated thereby.
(l) Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein and the registration rights
granted by the Issuer with respect to the Transfer Restricted Securities. There
are no restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein with respect to the registration rights granted by
the Issuer with respect to the Transfer Restricted Securities. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
[signature pages follow]
In Witness Whereof, the parties have executed this Agreement as
of the date first written above.
PG&E CORPORATION
By______________________________
Name:
Title:
LB I GROUP INC.
By______________________________
Name:
Title:
OAK HILL SECURITIES FUND, L.P.
By______________________________
Name:
Title:
DK ACQUISITION PARTNERS, L.P.
By______________________________
Title:
Name:
HBK MASTER FUND L.P.
By______________________________
Name:
Title:
TINICUM PARTNERS, L.P.
By______________________________
Name:
Title:
FARALLON CAPITAL PARTNERS, L.P.
By______________________________
Name:
Title:
FARALLON CAPITAL INSTITUTIONAL
PARTNERS, L.P.
By______________________________
Name:
Title:
FARALLON CAPITAL INSTITUTIONAL
PARTNERS II, L.P.
By______________________________
Name:
Title:
FARALLON CAPITAL INSTITUTIONAL
PARTNERS III, L.P.
By______________________________
Name:
Title:
EXHIBIT A
PG&E CORPORATION
FORM OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE
Beneficial owners that do not complete this Questionnaire within 20
Business Days of receipt hereof and deliver it to the Issuer as provided below
will not be named as selling securityholders in the prospectus and therefor will
not be permitted to sell any Transfer Restricted Securities pursuant to the
Shelf Registration Statement.
The undersigned beneficial holder of warrants (the "Warrants") issued
by of PG&E Corporation, a California corporation (the "Issuer") pursuant to that
certain Warrant Agreement, dated as of June 25, 2002, between the Company and
Initial Holders (as defined therein), or shares of common stock, no par value
per share, issuable upon exercise of any Warrant (the "Warrant Shares" and
together with any other securities issued or issuable with respect to any
Warrant Share by way of stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise, the "Transfer Restricted Securities") of the Issuer
understands that the Issuer has filed, or intends to file, with the Securities
and Exchange Commission (the "Commission") a registration statement (the "Shelf
Registration Statement"), for the registration and resale under Rule 415 of the
Securities Act of 1933, as amended (the "Securities Act"), of the Transfer
Restricted Securities in accordance with the terms of the Equity Registration
Rights Agreement, dated as of June 25, 2002 (the "Registration Rights
Agreement") between the Issuer and the other Initial Holders identified on the
signature pages thereto. A copy of the Registration Rights Agreement is
available from the Issuer upon request at the address set forth below. All
capitalized terms not otherwise defined herein have the meaning ascribed thereto
in the Registration Rights Agreement.
Each beneficial owner of Transfer Restricted Securities is entitled to
the benefits of the Registration Rights Agreement. In order to sell or otherwise
dispose of any Transfer Restricted Securities pursuant to the Shelf Registration
Statement, a beneficial owner of Transfer Restricted Securities generally will
be required to be named as a selling securityholder in the related Prospectus,
deliver a Prospectus to purchasers of Transfer Restricted Securities and be
bound by those provisions of the Registration Rights Agreement applicable to
such beneficial owner (including certain indemnification provisions, as
described below).
Certain legal consequences arise from being named as a selling
securityholder in the Shelf Registration Statement and the related Prospectus.
Accordingly, holders and beneficial owners of Transfer Restricted Securities are
advised to consult their own securities law counsel regarding the consequences
of being named or not being named as a selling securityholder in the Shelf
Registration Statement and the related Prospectus.
NOTICE
The undersigned beneficial owner (the "Selling Securityholder") of
Transfer Restricted Securities hereby gives notice to the Issuer of its
intention to sell or otherwise dispose of
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Transfer Restricted Securities beneficially owned by it and listed below in Item
3 (unless otherwise specified under Item 3) pursuant to the Shelf Registration
Statement. The undersigned, by signing and returning this Questionnaire,
understands that it will be bound by the terms and conditions of this
Questionnaire and the Registration Rights Agreement.
Pursuant to the Registration Rights Agreement and subject to the terms
thereof, the undersigned has agreed to indemnify and hold harmless the Issuer,
the Issuer's directors, the Issuer's officers who sign the Shelf Registration
Statement and each person, if any, who controls the Issuer within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act, from
and against certain losses set forth therein arising in connection with
statements concerning the undersigned made in the Shelf Registration Statement
or the related Prospectus in reliance upon the information provided in this
Questionnaire.
The undersigned hereby provides the following information to the Issuer
and represents and warrants that such information is accurate and complete:
QUESTIONNAIRE
2. Information Regarding Selling Securityholder
(a) Full legal name of Selling Securityholder: ______________________
(b) Full legal name of registered holder (if not the same as (a)
above) through which Transfer Restricted Securities listed in
Item (3) below are held:
_________________________________________________________________
(c) Full legal name of DTC participant (if applicable and if not the
same as (b) above) through which Transfer Restricted Securities
listed in Item (3) are held: ____________________________________
3. Address for Notices to Selling Securityholders
Telephone: ____________________________
Fax: __________________________________
Contact Person: _______________________
4. Beneficial Ownership of Transfer Restricted Securities
(a) Type of Transfer Restricted Securities beneficially owned, and
number of Warrant Shares beneficially owned: ____________________
(b) CUSIP No(s). of such Transfer Restricted Securities beneficially
owned: _________________________________________________________
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5. Beneficial Ownership of the Issuer's Securities Owned by the Selling
Securityholder
Except as set forth below in this Item (4), the undersigned is not the
beneficial or registered owner of any securities of the Issuer other than the
Transfer Restricted Securities listed above in Item (3) ("Other Securities").
(a) Type and amount of Other Securities beneficially owned by the
Selling Securityholder:
(b) CUSIP No(s). of such Other Securities beneficially owned:
________________________________________________________________
6. Relationship with the Issuer
Except as set forth below, neither the undersigned nor any of its
affiliates, officers, directors or principal equity holders (5% or more) has
held any position or office or has had any other material relationship with the
Issuer (or its predecessors or affiliates) during the past three years.
State any exceptions here: ____________________________________________
7. Plan of Distribution
Except as set forth below, the undersigned (including its donees or
pledgees) intends to distribute the Transfer Restricted Securities listed above
in Item (3) pursuant to the Shelf Registration Statement only as follows (if at
all). Such Transfer Restricted Securities may be sold from time to time directly
by the undersigned or, alternatively, through underwriters, broker-dealers or
agents. If the Transfer Restricted Securities are sold through underwriters or
broker-dealers, the Selling Securityholder will be responsible for underwriting
discounts or commissions or agent's commissions. Such Transfer Restricted
Securities may be sold in one or more transactions at fixed prices, at
prevailing market prices at the time of sale, at varying prices determined at
the time of sale, or at negotiated prices. Such sales may be effected in
transactions (which may involve crosses or block transactions):
(i) on any national securities exchange or quotation service
on which the Transfer Restricted Securities may be listed or quoted at
the time of sale;
(ii) in the over-the-counter market;
(iii) in transactions otherwise than on such exchanges or
services or in the over-the-counter market; or
(iv) through the writing of options, whether such options are
listed on an options exchange or otherwise;
(v) ordinary brokers' transactions;
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(vi) purchases by brokers, dealers or underwriters as principal and
resale by these purchasers for their own accounts pursuant to this
prospectus;
(vii) "at the market," to or through market makers, or into an
existing market for our common stock;
(viii) in other ways not involving market makers or established trading
markets, including direct sales to purchasers or sales effected through
agents;
(ix) through transactions in swaps or other derivatives (whether
exchange-listed or otherwise); or
(x) to cover short sales.
In connection with sales of the Transfer Restricted Securities or
otherwise, the undersigned may enter into hedging transactions with
broker-dealers, which may in turn engage in short sales of the Transfer
Restricted Securities and deliver Transfer Restricted Securities to close out
such short positions, or loan or pledge Transfer Restricted Securities to
broker-dealers that in turn may sell such securities.
State any exceptions here: ____________________________________________
_______________________________________________________________________
Note: In no event will such method(s) of distribution take the form of
an underwritten offering of the Transfer Restricted Securities without the prior
agreement of the Issuer.
8. Instructions for Delivery of Questionnaire
Please return the completed and executed Questionnaire to PG&E
Corporation at:
PG&E Corporation
Xxx Xxxxxx, Xxxxx Xxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Assistant Treasurer
9. Acknowledgments
The undersigned acknowledges that it understands its obligation to
comply with the provisions of the Exchange Act and the rules and regulations
promulgated thereunder relating to stock manipulation, particularly Regulation M
thereunder (or any successor rules or regulations), in connection with any
offering of Transfer Restricted Securities pursuant to the Shelf Registration
Statement. The undersigned agrees that neither it nor any person acting on its
behalf will engage in any transaction in violation of such provisions.
The Selling Securityholder hereby acknowledges its obligations under
the Registration Rights Agreement to indemnify and hold harmless certain persons
as set forth therein. Pursuant
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to the Registration Rights Agreement, the Issuer has agreed under certain
circumstances to indemnify the Selling Securityholders against certain
liabilities.
In accordance with the undersigned's obligation under the Registration
Rights Agreement to provide such information as may be required by law for
inclusion in the Shelf Registration Statement, the undersigned agrees to
promptly notify the Issuer of any inaccuracies or changes in the information
provided herein that may occur subsequent to the date hereof at any time while
the Shelf Registration Statement remains effective. All notices hereunder and
pursuant to the Registration Rights Agreement shall be made in writing at the
address set forth above.
By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to items (1) through (7) above and
the inclusion of such information in the Shelf Registration Statement and the
related Prospectus. The undersigned understands that such information will be
relied upon by the Issuer in connection with the preparation or amendment of the
Shelf Registration Statement and the related Prospectus.
IN WITNESS WHEREOF, the undersigned, by authority duly given, has
caused this Questionnaire to be executed and delivered either in person or by
its duly authorized agent.
Beneficial Owner
By:________________________________
Name:
Title:
Date:
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