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REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") dated as of June
14, 1999, is by and among Energy Convergence Holding Company, an Illinois
corporation (the "Company"), and Chevron U.S.A. Inc., a Pennsylvania corporation
("Stockholder").
WHEREAS, pursuant to (i) the Merger Agreement (the "Merger Agreement")
dated the date hereof among Illinova Corporation, an Illinois corporation, the
Company, Dynegy Acquisition Corporation, a Delaware corporation, Energy
Convergence Acquisition Corporation, an Illinois corporation, and Dynegy Inc., a
Delaware corporation ("Dynegy"), and (ii) the Subscription Agreement dated the
date hereof between Company and Stockholder, Stockholder will receive at or
immediately after the Effective Time (as such term is defined in the Merger
Agreement), shares of Class B common stock, no par value per share (the "Class B
Common Stock"), of the Company; and
WHEREAS, in connection with the Merger Agreement, the Company has
agreed to grant to Stockholder certain registration rights set forth below.
NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by Stockholder and the Company, the parties hereto agree as
follows:
SECTION 1.
DEFINITIONS
1.1 SPECIFIC DEFINITIONS.
The following capitalized terms shall have the meanings ascribed to
them in this Section 1.1:
"Affiliate" shall have the meaning set forth in Rule 12b-2 under the
Exchange Act.
"Agreement" shall have the meaning set forth in the preamble hereto.
"BGAH" means British Gas Atlantic Holdings BV, a Netherlands
corporation.
"BG/NOVA Agreement" is defined in Section 11.2.
"Class B Common Stock" shall have the meaning set forth in the recitals
hereto.
"Common Stock" shall mean the Class A common stock of the Company, no
par value per share.
"Company" shall have the meaning set forth in the preamble hereto.
"Company Registration" is defined in Section 3.1.
"Dynegy" shall have the meaning set forth in the recitals hereto.
"Effective Time" shall have the meaning set forth in the Merger
Agreement.
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"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Holder" shall mean Stockholder and each transferee of Registrable
Common Stock directly or indirectly (in a chain of title) from Stockholder to
whom the right to cause one or more demand registrations under Section 2.1 has
been expressly assigned in writing directly or indirectly (in a chain of title)
from Stockholder.
"Indemnified Party" shall have the meaning set forth in Section 7.3.
"Indemnifying Party" shall have the meaning set forth in Section 7.3.
"Initial Date" shall mean the date which is 270 days after the
Effective Time.
"Inspectors" shall have the meaning set forth in Section 4.1(l).
"Loss" or "Losses" shall have the meaning set forth in Section 7.1.
"Merger Agreement" shall have the meaning set forth in the recitals
hereto.
"NOVA" shall mean NOVA Gas Services (U.S.) Inc., a Delaware
corporation.
"person" shall mean any business entity (including, without limitation,
a corporation, partnership (limited or general), limited liability company or
business trust) or a natural person.
"Preferred Stock" shall mean the Series A Convertible Preferred Stock,
no par value per share, of the Company.
"Prospectus" shall have the meaning set forth in Section 7.1.
"register" "registered" and "registration" and words of similar import
refer to a registration effected by preparing and filing with the SEC a
registration statement in compliance with the Securities Act, and the
declaration and ordering by the SEC of effectiveness of such registration
statement or document.
"Registrable Common Stock" shall mean any Common Stock issuable upon
conversion of Class B Common Stock held or acquired by Stockholder (or its
permitted assigns) as of the Effective Time, and any securities issued or
issuable in respect of any such Registrable Common Stock by way of any stock
split or stock dividend or in connection with any combination of shares,
recapitalization, merger, consolidation, reorganization or otherwise.
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Stockholder" shall have the meaning set forth in the preamble hereto.
1.2 OTHER DEFINITIONS.
Other capitalized terms used herein but not defined in Section 1.1
shall have the respective meanings ascribed to them throughout this Agreement.
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SECTION 2.
REGISTRATION RIGHTS
2.1 DEMAND REGISTRATION RIGHTS.
(a) After the Initial Date, upon receipt of a written request
from a Holder to register under the Securities Act (whether for purposes of a
public offering, an exchange offer or otherwise) all or part of the Registrable
Common Stock held by such Holder, the Company shall as expeditiously as
reasonably possible (but in any event not later than forty-five (45) days after
receipt of such request) prepare and file, and use its best efforts to cause to
become effective as soon thereafter as practicable, a registration statement
under the Securities Act to effect the offering of such Registrable Common Stock
in the manner specified in such request.
(b) Holder shall be entitled to select and retain one or more
investment bankers or managers reasonably acceptable to the Company in
connection with any underwritten offerings made pursuant to this Section 2.1.
(c) Subject to the terms and conditions set forth in Section
2.2, Holder may request the Company to register Registrable Common Stock under
the Securities Act pursuant to this Section 2.1 at any time and from time to
time; provided, however, that a Holder may not request the Company to register
Registrable Common Stock pursuant to this Section 2.1 more than once in any
180-day period.
2.2 TERMS AND CONDITIONS OF DEMAND REGISTRATION RIGHTS.
Notwithstanding anything to the contrary contained elsewhere herein,
the registration rights granted to the Holders in Section 2.1 are expressly
subject to the following terms and conditions:
(a) The Holders, collectively, shall only be entitled (i) to
eight (8) requests to register Registrable Common Stock under the terms of
Section 2.1, and (ii) to commence requests after the Initial Date. A "request"
as it is used in this Section 2.2(a) shall be deemed to have occurred only upon
completion of a requested registration and the subsequent sale of Registrable
Common Stock.
(b) In no event shall the Registrable Common Stock to be
offered under a registration statement prepared and filed pursuant to Section
2.1 constitute less than (i) five percent (5%) of the then outstanding shares of
Common Stock (treating the Class B Common Stock and the Preferred Stock as if it
had been converted into Common Stock in accordance with its terms for the
purposes of this calculation), or (ii) if the number of shares of Registrable
Common Stock constitutes less than five percent (5%) of the then outstanding
shares of Common Stock (treating the Class B Common Stock and the Preferred
Stock as if it had been converted into Common Stock in accordance with its terms
for the purposes of this calculation), then all of Stockholder's remaining
shares of Registrable Common Stock.
(c) The Company shall be entitled to defer for a reasonable
period of time, but not in excess of ninety (90) days, the filing of any
registration statement otherwise required to be prepared and filed by it under
Section 2.1 if the Company notifies the Holder, within five (5)
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business days after such Holder requested the registration under Section 2.1
that the Company (i) is at such time conducting or about to conduct an
underwritten public offering of its securities for its own account and the Board
of Directors of the Company determines in good faith that such offering would be
materially adversely affected by such registration requested by the Holders or
(ii) would, in the opinion of its counsel, be required to disclose in such
registration statement information not otherwise then required by law to be
publicly disclosed and, in the good faith judgment of the Board of Directors of
the Company, such disclosure might adversely affect any material business
transaction or negotiation in which the Company is then engaged. If the Company
elects to defer the filing of a registration statement pursuant to this Section
2.2(c), the Holder may withdraw its request, in writing, during the time of such
deferral and such request shall not be counted toward the limit set forth in
Section 2.2(a).
(d) The Holders shall not exercise their rights pursuant to
Section 2.1 during the 60-day period immediately following the effective date of
any registration statement filed by the Company under the Securities Act (other
than on Form S-8 or another similar form) in respect of an offering or sale of
Common Stock of the Company by or on behalf of the Company or any other
stockholder of the Company.
SECTION 3.
PIGGYBACK REGISTRATION RIGHTS
3.1 PIGGYBACK REGISTRATION RIGHTS. If at any time or from time to time
the Company shall propose to register any Common Stock for public sale under the
Securities Act (a "Company Registration"), the Company shall give Stockholder
prompt written notice of the proposed registration and shall include in such
registration on the same terms and conditions as the other securities included
in such registration such number of shares of Registrable Common Stock as
Stockholder shall request within five (5) business days after the giving of such
notice; provided, however, that the Company may at any time prior to the
effectiveness of any such registration statement, in its sole discretion and
without the consent of Stockholder, abandon the proposed offering in which
Stockholder had requested to participate (provided that the Company gives
Stockholder prompt notice of such decision); and provided further that
Stockholder shall be entitled to withdraw any or all of its shares of
Registrable Common Stock to be included in a registration statement under this
Section 3.1 at any time prior to the date on which the registration statement
with respect to such shares of Registrable Common Stock is declared effective by
the SEC. The Company shall be entitled to select the investment bankers and/or
managers, if any, to be retained in connection with any registration referred to
in this Section 3.1, provided such investment bankers and/or managers are
reasonably acceptable to Stockholder.
3.2 RESTRICTIONS ON PIGGYBACK REGISTRATION RIGHTS.
Notwithstanding anything to the contrary contained elsewhere herein,
the registration rights granted to Stockholder in Section 3.1 are expressly
subject to the following terms and conditions:
(a) The Company shall not be obligated to include shares of
Registrable Common Stock in an offering as contemplated by Section 3.1 if the
Company is advised in writing by the managing underwriter or underwriters of
such offering (with a copy to Stockholder), that the success of such offering
would in its or their good faith judgment be jeopardized by such
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inclusion (after consideration of all relevant factors, including without
limitation, the impact of any delay caused by including such shares); provided,
however, that the Company shall in any case be obligated to include such number
of shares of Registrable Common Stock in such offering, if any, as such
underwriter or underwriters shall determine will not jeopardize the success of
such offering.
(b) The Company shall not be obligated to include any shares
of Registrable Common Stock in any registration by the Company of any Common
Stock in connection with any merger, acquisition, exchange offer, or any other
business combination, including any transaction within the scope of Rule 145
promulgated pursuant to the Securities Act, subscription offer, dividend
reinvestment plan or stock option or other director or employee incentive or
benefit plan.
(c) The Company shall use all commercially reasonable efforts
to cause the managing underwriter or underwriters of a proposed underwritten
offering to permit the Registrable Common Stock requested to be included in a
registration of Common Stock pursuant to this Section 3 to be included on the
same terms and conditions as any similar securities included therein.
Notwithstanding the foregoing, the Company shall not be required to include
Stockholder's Registrable Common Stock in such offering unless Stockholder
accepts the terms of the underwriting agreement between the Company and the
managing underwriter or underwriters and otherwise complies with the provisions
of Section 8 below. If the managing underwriter or underwriters of a proposed
underwritten offering advise the Company in writing that in its or their good
faith judgment the total amount of securities, including securities requested to
be included in a registration of Common Stock pursuant to this Section 3 and
other similar securities, to be included in such offering is sufficiently large
to jeopardize the success of such offering, then in such event the securities to
be included in such offering shall be allocated first to the Company and then,
to the extent that any additional securities can, in the good faith judgment of
such managing underwriter or underwriters, be sold without creating any such
jeopardy to the success of such offering, to Stockholder based upon the number
of shares of Registrable Common Stock requested to be included in such
registration.
(d) In the event that some but less than all of Stockholder's
shares of Registrable Common Stock are included in an offering contemplated by a
registration statement pursuant to this Section 3, Stockholder shall execute one
or more "lockup" letters, in customary form, setting forth an agreement by
Stockholder not to offer for sale, sell, grant any option for the sale of, or
otherwise dispose of, directly or indirectly, any shares of Common Stock, or any
securities convertible into or exchangeable into or exercisable for any shares
of Common Stock, for a period of 90 days from the date such offering commences;
provided, however, that if the period of any such "lockup" applicable to the
Company with respect to any such registration statement shall be less than
ninety (90) days, then the period of time applicable to Stockholder shall be
such lesser period of time.
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SECTION 4.
COVENANTS
4.1 COVENANTS OF THE COMPANY.
In connection with any offering of shares of Registrable Common Stock
pursuant to this Agreement, the Company shall:
(a) Prepare and file with the SEC such amendments and
post-effective amendments to the registration statement as may be necessary to
keep the registration statement effective for a period of not less than 120
days, or such shorter period which will terminate when all Registrable Common
Stock covered by such registration statement has been sold or withdrawn at the
request of participating holders of Common Stock; and cause the prospectus to be
supplemented by any required prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 under the Securities Act;
(b) Furnish to Stockholder and to each managing underwriter,
if any, (i) at least two (2) business days prior to filing with the SEC, any
registration statement covering shares of Registrable Common Stock, any
amendment or supplement thereto, and any prospectus used in connection
therewith, which documents will be subject to the reasonable review of
Stockholder and such underwriter, and, with respect to a registration statement
prepared pursuant to Section 2.1, the Company shall not file any such documents
with the SEC to which Stockholder shall reasonably object; and (ii) a copy of
any and all transmittal letters or other correspondence with the SEC or any
other governmental agency or self-regulatory body or other body having
jurisdiction (including any domestic or foreign securities exchange) relating to
such offering of shares of Registrable Common Stock;
(c) Furnish to Stockholder and each managing underwriter, if
any, such number of copies of such registration statement, each amendment and
supplement thereto (in each case including all exhibits thereto and documents
incorporated by reference therein) and the prospectus included in such
registration statement (including each preliminary prospectus and prospectus
supplement) as Stockholder or such underwriter may reasonably request in order
to facilitate the sale of the shares of Registrable Common Stock;
(d) After the filing of such registration statement, promptly
notify Stockholder of any stop order issued or enforcement action initiated or,
to the knowledge of the Company, threatened to be issued by the SEC and promptly
take all reasonable actions to prevent the entry of such stop order or to obtain
its withdrawal if entered;
(e) Use its commercially reasonable efforts to qualify such
shares of Registrable Common Stock for offer and sale under the securities,
"blue sky" or similar laws of such jurisdictions (including any foreign country
or any political subdivision thereof in which shares of Common Stock are then
listed) as Stockholder or underwriter shall reasonably request and use its
commercially reasonable efforts to obtain all appropriate registrations, permits
and consents required in connection therewith, except that the Company shall not
for any such purpose be required to qualify generally to do business as a
foreign corporation in any jurisdiction wherein it is not so qualified, or to
subject itself to taxation or to file a general consent to service of process in
any such jurisdiction;
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(f) Furnish to each managing underwriter, if any, an opinion
of counsel for the Company addressed to each of them, dated as of the date of
the closing of the offering of shares of Registrable Common Stock, and a
"comfort" letter or letters signed by the Company's independent public
accountants, each in reasonable and customary form and covering such matters of
the type customarily covered by opinions or comfort letters delivered by such
parties in underwritten public offerings, and use its commercially reasonable
efforts to have such opinions and comfort letters addressed to and delivered to
Stockholder;
(g) Furnish unlegended certificates representing ownership of
the shares of Registrable Common Stock being sold in such denominations as shall
be requested by Stockholder or the managing underwriter, if any, provided such
request is made at least two (2) business days prior to the closing of the sale
of such shares;
(h) Promptly inform Stockholder (i) in the case of any
offering of shares of Registrable Common Stock in respect of which a
registration statement is filed under the Securities Act, of the date on which
such registration statement or any post-effective amendment thereto becomes
effective and, if applicable, of the date of filing a Rule 430A prospectus (and,
in the case of an offering abroad of shares of Registrable Common Stock, of the
date when any required filing under the securities and other laws of such
foreign jurisdictions shall have been made and when the offering may be
commenced in accordance with such laws) and (ii) of any request by the SEC, any
securities exchange, government agency, self-regulatory body or other body
having jurisdiction for any amendment of or supplement to any registration
statement or preliminary prospectus or prospectus included therein or any
offering memorandum or other offering document relating to such offering;
(i) Subject to subparagraph (k) below, until the earlier of
(i) such time as all of the shares of Registrable Common Stock being offered
have been disposed of in accordance with the intended method of disposition by
Stockholder set forth in the registration statement or other offering document
(and the expiration of any prospectus delivery requirements in connection
therewith) or (ii) the expiration of nine (9) months after such registration
statement or other offering document becomes effective (unless the offering is a
continuous offering of securities under Rule 415, in which case until the
earliest of the date the offering is completed and the second anniversary of
such effective date), keep effective and maintain any registration,
qualification or approval obtained in connection with the offering of the shares
of Registrable Common Stock, and amend or supplement the registration statement
or prospectus or other offering document used in connection therewith to the
extent necessary in order to comply with applicable securities laws;
(j) Use its commercially reasonable efforts to have the shares
of Registrable Common Stock listed on any domestic and foreign securities
exchanges on which the Common Stock is then listed;
(k) As promptly as practicable, notify Stockholder at any time
when a prospectus relating to the sale of the shares of Registrable Common Stock
is required by law to be delivered in connection with sales by an underwriter or
dealer, of the occurrence of an event requiring the preparation of a supplement
or amendment to such prospectus so that, as thereafter delivered to the
purchasers of such shares, such prospectus will not contain an untrue statement
of a material
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fact or omit to state any material fact required to be stated therein or
necessary to make the statement therein, in light of the circumstances under
which they were made, not misleading, and as promptly as practicable make
available to Stockholder and to each managing underwriter, if any, any such
supplement or amendment; in the event the Company shall give such notice, the
Company shall extend the period during which such registration statement shall
be maintained effective as provided in Section 4.1(i) by the number of days
during the period from and including the date of the giving of such notice to
the date when the Company shall make available to Stockholder such supplemented
or amended prospectus;
(l) Make available for inspection during the normal business
hours of the Company by Stockholder, any underwriter participating in such
offering, and any attorney, accountant or other agent retained by Stockholder or
any such underwriter in connection with the sale of shares of Registrable Common
Stock (collectively, the "Inspectors"), all relevant financial and other
records, pertinent corporate documents and properties of the Company as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the officers, directors and employees of the Company
to supply all information reasonably requested by any such Inspector in
connection with such registration statement and make available for consultation
and for analyst and other marketing calls such officers, accountants and
employees in connection therewith as shall reasonably be requested by
Stockholder; provided, however, that (i) in connection with any such inspection,
any such Inspectors shall cooperate to the extent reasonably practicable to
minimize any disruption to the operation by the Company of its business and (ii)
any records, information or documents shall be kept confidential by such
Inspectors, unless (1) such records, information or documents are in the public
domain or otherwise publicly available or (2) disclosure of such records,
information or documents is required by a court or administrative order or by
applicable law (including, without limitation, the Securities Act);
(m) Enter into and perform its obligations under usual and
customary agreements (including an underwriting agreement in usual and customary
form) and take such other actions as are reasonably required in order to
expedite or facilitate the sale of the Registrable Common Stock.
(n) Make "generally available to its security holders" (within
the meaning of Rule 158 of the Securities Act) an earnings statement satisfying
the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder no
later than 45 days after the end of the 12-month period beginning with the first
day of the Company's first fiscal quarter commencing after the effective date of
the registration statement, which earnings statement shall cover said 12-month
period;
(o) If requested by the managing underwriter or underwriters
or Stockholder, promptly incorporate in a prospectus supplement or
post-effective amendment such information as the managing underwriter or
underwriters or any participating Holder reasonably requests to be included
therein, including, without limitation, information with respect to the number
of shares of Registrable Common Stock being sold by Stockholder to any
underwriter or underwriters, the purchase price being paid therefor by such
underwriter or underwriters and with respect to any other terms of an
underwritten offering of the Registrable Common Stock to
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be sold in such offering, and promptly make all required filings of such
prospectus by supplement or post-effective amendment;
(p) As promptly as practicable after filing with the SEC of
any document which is incorporated by reference in a prospectus contained in a
registration statement, deliver a copy of such document to Stockholder;
(q) Not later than the effective date of the applicable
registration statement (or if later, the earliest business day thereafter on
which a CUSIP number is available), provide a CUSIP number for all Registrable
Common Stock and provide the applicable transfer agent with printed certificates
for the Registrable Common Stock which are in a form eligible for deposit with
The Depository Trust Company (if such Registrable Common Stock is then eligible
for such deposit);
(r) Cooperate with each seller of Registrable Common Stock and
each underwriter or agent, if any, participating in the disposition thereof and
their respective counsel in connection with any filings required to be made with
the National Association of Securities Dealers;
(s) Provide and cause to be maintained a transfer agent and
registrar for all Registrable Common Stock covered by such registration
statement from and after a date not later than the effective date thereof; and
(t) Take all other steps necessary to effect the registration
of the Registrable Common Stock contemplated hereby.
4.2 COVENANT OF STOCKHOLDER.
Stockholder agrees and covenants that, upon receipt of any notice from
the Company of the happening of any event of the kind described in Section
4.1(k) hereof, Stockholder will forthwith discontinue disposition of Registrable
Common Stock pursuant to the registration statement covering such Registrable
Common Stock until Stockholder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 4.1(k) hereof, and, if so directed by
the Company, Stockholder will deliver to the Company all copies, other than
permanent file copies, then in Stockholder's possession of the most recent
prospectus covering such Registrable Common Stock at the time of receipt of such
notice.
SECTION 5.
RESTRICTIONS ON PUBLIC SALE BY THE COMPANY AND OTHERS
The Company agrees:
(a) Not to effect any public sale or distribution of any
securities during the 90-day period commencing on the effective date of a
registration statement filed pursuant to Section 2.1, except in connection with
any merger, acquisition, exchange offer, or any other business combination,
including any transaction within the scope of Rule 145 promulgated pursuant to
the Securities Act, subscription offer, dividend reimbursement plan or stock
option or other director or employee incentive or benefit plan;
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(b) That any agreement entered into after the date hereof
pursuant to which the Company grants registration rights with respect to the
Company's securities shall contain a provision under which holders of such
securities agree, to the extent not inconsistent with applicable laws, not to
effect any public sale or distribution of any such securities (excluding any
sale in accordance with Rule 144 under the Securities Act) during the period
commencing with the effective date of a registration statement pursuant to
Section 2.1 through the 90-day period beginning on the date that the
registration statement filed pursuant to Section 2.1 becomes effective.
SECTION 6.
EXPENSES
All expenses incurred in connection with the registration of
Registrable Common Stock, including, without limitation, all filing fees, escrow
fees, fees and expenses of compliance with securities or blue sky laws
(including fees and disbursements of the Company's counsel in connection with
blue sky qualifications of the Registrable Common Stock), rating agency fees,
printing expenses, messenger and delivery expenses, internal expenses
(including, without limitation, all salaries and expenses of the Company's
officers and employees performing legal or accounting duties), the fees and
expenses incurred in connection with the listing of the securities to be
registered on each securities exchange on which similar securities issued by the
Company are then listed, and fees and disbursements of counsel for the Company
and the reasonable fees and disbursements of a single counsel for Stockholder
and the Company's independent certified public accountants (including the
expenses of any special audit or "cold comfort" letters required by or incident
to such performance) directly attributable to the registration of securities,
Securities Act liability insurance (if the Company elects to obtain such
insurance), and the fees and expenses of any special experts or other persons
retained by the Company will be borne by the Company. The Company shall have no
obligation to pay and shall not pay any underwriting fees, discounts or
commissions in connection with any Registrable Common Stock registered pursuant
to this Agreement or any out-of-pocket expenses of the holders in connection
therewith (except as expressly contemplated by the preceding sentence).
SECTION 7.
INDEMNIFICATION
7.1 INDEMNIFICATION BY THE COMPANY.
The Company agrees to indemnify and hold harmless Stockholder, its
officers, directors and agents, and will agree to indemnify and hold harmless
any underwriter of Registrable Common Stock, and each person, if any, who
controls any of the foregoing persons within the meaning of either Section 15 of
the Securities Act or Section 20 of the Exchange Act, from and against any and
all losses, claims, damages and liabilities (individually, a "Loss"
collectively, "Losses") arising from or caused by (x) any untrue statement or
alleged untrue statement of a material fact contained in any registration
statement or prospectus relating to the Registrable Common Stock (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) or any preliminary prospectus, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and (y) any violation
or alleged violation by the
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Company of the Securities Act, any blue sky laws, securities laws or other
applicable laws of any state in which shares of Registrable Common Stock are
offered and relating to action or inaction required of the Company in connection
with such offering; and will reimburse each such person for any legal or other
out-of-pocket expenses reasonably incurred in connection with investigating, or
defending against, any such Loss (or any proceeding in respect thereof), subject
to the provisions of Section 7.3, except that the indemnification provided for
in this Section 7.1 shall not apply to Losses that are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon and in
conformity with information furnished in writing to the Company by or on behalf
of Stockholder expressly for use therein. Notwithstanding the foregoing, the
Company shall not be liable in any such case to the extent that any such Loss
arises out of, or is based upon, an untrue statement or alleged untrue statement
or omission or alleged omission made in any preliminary prospectus if (i)
Stockholder failed to send or deliver a copy of the prospectus included in the
relevant registration statement at the time it became effective (the
"Prospectus") with or prior to the delivery of written confirmation of the sale
of Registrable Common Stock to the person asserting such Loss or who purchased
such Registrable Common Stock which are the subject thereof if, in either case,
such delivery is required by the Securities Act and (ii) the Prospectus would
have corrected such untrue statement or omission or alleged untrue statement or
alleged omission; and the Company shall not be liable in any such case to the
extent that any such Loss arises out of, or is based upon, an untrue statement
or alleged untrue statement of a material fact or omission or alleged omission
to state a material fact in the Prospectus, if such untrue statement or alleged
untrue statement or omission or alleged omission is corrected in any amendment
or supplement to the Prospectus and if, having previously been furnished by or
on behalf of the Company with copies of the Prospectus as so amended or
supplemented, Stockholder thereafter fails to deliver such Prospectus as so
amended or supplemented prior to and concurrently with the sale of Registrable
Common Stock if such delivery is required by the Securities Act. Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of Stockholder or any other person indemnified hereunder and shall
survive the transfer of such securities by Stockholder.
7.2 INDEMNIFICATION BY STOCKHOLDER.
Stockholder agrees to indemnify and hold harmless the Company, its
officers and directors, and each person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the indemnity made pursuant to clause (x) of
Section 7.1 above from the Company to Stockholder, but only with reference to
information furnished in writing by or on behalf of Stockholder expressly for
use in any registration statement or prospectus relating to shares of
Registrable Common Stock, or any amendment or supplement thereto, or any
preliminary prospectus.
7.3 CONDUCT OF INDEMNIFICATION PROCEEDINGS.
In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to Section 7.1 or 7.2, such person (the "Indemnified Party") shall
promptly notify the person against whom such indemnity may be sought (the
"Indemnifying Party") in writing, provided that the omission to so notify the
Indemnifying Party will not relieve the Indemnifying Party of any liability it
may have under this Agreement or otherwise except to the extent of any loss,
damage, liability or expense arising from such omission. The Indemnifying Party,
upon the request of the Indemnified Party,
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shall retain counsel reasonably satisfactory to such Indemnified Party to
represent such Indemnified Party and any others the Indemnifying Party may
designate in such proceeding and shall pay the fees and disbursements of such
counsel related to such proceeding. In any such proceeding, any Indemnified
Party shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such Indemnified Party unless (i) the
Indemnifying Party and the Indemnified Party shall have mutually agreed to the
retention, (ii) the Indemnifying Party shall have failed to comply with its
obligations under the preceding sentence or (iii) the Indemnified Party shall
have been advised by its counsel in writing that actual or potential differing
interests exist between the Indemnifying Party and the Indemnified Party. The
Indemnifying Party shall not be liable for any settlement of any proceeding
effected without its written consent, which consent shall not be unreasonably
withheld. The Indemnifying Party shall not agree to any settlement as the result
of which any remedy or relief, other than monetary damages for which the
Indemnifying Party shall be fully responsible, shall be applied to or against an
Indemnified Party without the prior written consent of such Indemnified Party.
7.4 CONTRIBUTION.
If the indemnification provided for in this Section 7.4 from the
Indemnifying Party is unavailable to an Indemnified Party hereunder in respect
of any losses, claims, damages, liabilities or expenses referred to therein,
then the Indemnifying Party, in lieu of indemnifying such Indemnified Party,
shall contribute to the amount paid or payable by such Indemnified Party as a
result of such losses, claims, damages, liability or expenses in such proportion
as is appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative fault of such Indemnifying Party and
Indemnified Party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact, has
been made by, or relates to information supplied by, such Indemnifying Party or
Indemnified Party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action. The amount paid
or payable by a party as a result of the losses, claims, damages, liabilities
and expenses referred to above shall be deemed to include, subject to the
limitations set forth in Section 7.3, any legal or other fees or expenses
reasonably incurred by such party in connection with any investigation or
proceeding. No party shall be liable for contribution with respect to any action
or claim settled without its written consent, which consent shall not be
unreasonably withheld.
Notwithstanding the provisions of this Section 7.4, Stockholder shall
not be required to contribute any amount in excess of the amount by which the
total price at which the Registrable Common Stock of Stockholder was offered to
the public exceeds the amount of any damages which Stockholder has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission of alleged omission. The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 7.4 were determined by
pro rata allocation or by any other method of allocation which does not take
into account the equitable considerations referred to in the immediately
preceding paragraph. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
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SECTION 8.
TERMINATION
This Agreement shall terminate upon the first such instance as
Stockholder ceases to own at least one percent (1%) of the outstanding Common
Stock (treating the Class B Common Stock and the Preferred Stock as if it had
been converted into Common Stock in accordance with its terms for the purposes
of this calculation). For the purposes of this Section 8, Stockholder shall be
deemed to own any and all Common Stock owned by Stockholder and its Affiliates.
Notwithstanding the foregoing, the Company's and Stockholder's rights, duties
and obligations under Section 6 and Section 7 shall survive the termination of
this Agreement.
SECTION 9.
AVAILABLE INFORMATION
The Company shall take such reasonable action and file such
information, documents and reports as shall be required by the SEC as a
condition to the availability of Rule 144 and Rule 144A, or any successor
provisions.
SECTION 10.
ASSIGNMENT OF RIGHTS
10.1 ASSIGNMENT OF RIGHTS.
Subject to Section 10.2, the Registrable Common Stock and rights of
Stockholder under this Agreement with respect to any Registrable Common Stock
owned by Stockholder may be assigned to any person who acquires Registrable
Common Stock from Stockholder, except that any person who acquires such
Registrable Common Stock (x) pursuant to a public offering registered under the
Securities Act, or (y) pursuant to a transfer made in accordance with Rule 144
under the Securities Act (or any similar successor provision) may not assign
rights hereunder with respect to such Registrable Common Stock. Notwithstanding
the foregoing, rights to cause one or more demand registrations under Section
2.1 may only be assigned if such rights are expressly assigned in writing from a
Holder. Any assignment of registration rights pursuant to this Section 10.1
shall be effective upon receipt by the Company of written notice from
Stockholder (i) stating the name and address of any assignee, (ii) describing
the manner in which the assignee acquired Registrable Common Stock from
Stockholder and (iii) identifying the Registrable Common Stock with respect to
which the rights under this Agreement are being assigned.
10.2 SCOPE OF ASSIGNMENT.
The rights of an assignee under Section 10.1 shall be the same rights
granted to the Stockholder under this Agreement, except that in no event shall
the Company's obligations hereunder be increased due to any such assignment. In
connection with any such assignment, the term "Stockholder" as used herein
shall, where appropriate to assign the rights and obligations of the assigning
Stockholder hereunder to such assignee, be deemed to refer to the assignee.
After any such assignment, Stockholder shall retain its rights under this
Agreement with respect to all other Registrable Common Stock owned by
Stockholder.
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SECTION 11.
MISCELLANEOUS
11.1 TERMINATION OF OLD REGISTRATION RIGHTS AGREEMENT. Stockholder
acknowledges that the Registration Rights Agreement dated August 31, 1996 among
NGC Corporation (former name of Dynegy), BG Holdings, Inc., NOVA, and
Stockholder is terminated with respect to it effective upon consummation of the
Merger provided for in the Merger Agreement.
11.2 BG/NOVA PRIORITY.
(a) Favored Nations. Except as herein provided, for a period
of three years from the Effective Time, the Company shall not provide
registration rights to any other party which, taken as a whole, are more
favorable than those provided to Stockholder hereunder, without also offering to
Stockholder such more favorable rights; provided, however, that the benefits of
this Section 11.2 shall not run to Stockholder if Stockholder holds less than
two percent (2%) of the then outstanding shares of Common Stock (treating the
Class B Common Stock and the Preferred Stock as if they had been converted for
purposes of this calculation). The Company shall give Stockholder notice within
15 days after the execution of any agreement (including the terms thereof)
between the Company and a third party which triggers a right of Stockholder to
invoke the favored nations provision of this Section 11.2.
(b) For a period of twenty-four months after the Effective
Time:
(i) if NOVA or BG exercises a demand
registration right under the Registration
Rights Agreement dated as of the date hereof
among the Company, BG Atlantic and NOVA (the
"BG/NOVA Agreement"), then Stockholder may
participate in such registration only
through exercise of its piggyback
registration rights hereunder, subject to
any underwriter cutback;
(ii) if Stockholder exercises a demand
registration right hereunder to effect a
disposition other than one intended to
satisfy any regulatory requirements, then
NOVA and BG shall have the right to
participate on a "Pro-Rata Basis" in such
demand registration. For purposes of this
subsection 11.2, "Pro-Rata Basis" shall mean
that each participant in such registration
shall be entitled to register an equal
number of shares; and
(iii) in the event of a Company Registration, any
Stockholder shares participating in such
Company Registration shall be subject to any
underwriter's cutback prior to any cutback
of any BG or NOVA shares participating in
such Company Registration.
(c) Following twenty-four months after the Effective Time:
(i) if Stockholder exercises a demand
registration right hereunder (other than any
exercise by Stockholder to effect a
disposition
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intended to satisfy any regulatory
requirements) or BG or NOVA exercise such a
right under the BG/NOVA Agreement, then each
of BG, Stockholder and NOVA shall be
entitled to participate in such demand
registration on a Pro-Rata Basis; and
(ii) in the event of a Company Registration, each
of BG, NOVA or Stockholder shares
participating in such Company Registration
shall be subject to any underwriter's
cutback on a Pro-Rata Basis.
11.3 PROVISION OF INFORMATION.
Stockholder shall, and shall cause its officers, directors, employees
and agents to complete and execute all such questionnaires as the Company shall
reasonably request in connection with any registration pursuant to this
Agreement.
11.4 INJUNCTIONS.
Irreparable damage would occur in the event that any of the provisions
of this Agreement were not performed in accordance with its specified terms or
were otherwise breached. Therefore, the parties hereto shall be entitled to an
injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically the terms of provisions hereof in any
court having jurisdiction, such remedy being in addition to any other remedy to
which they may be entitled at law or in equity.
11.5 SEVERABILITY.
If any term or provision of this Agreement is held by a court of
competent jurisdiction to be invalid, void, or unenforceable, the remainder of
the terms and provisions set forth herein shall remain in full force and effect
and shall in no way be affected, impaired or invalidated, and the parties hereto
shall use their best efforts to find and employ an alternative means to achieve
the same or substantially the same result as that contemplated by such term or
provision.
11.6 FURTHER ASSURANCES.
Subject to the specific terms of this Agreement, Stockholder and the
Company shall make, execute, acknowledge and deliver such other instruments and
documents, and take all such other actions, as may be reasonably required in
order to effectuate the purposes of this Agreement and to consummate the
transactions contemplated hereby.
11.7 ENTIRE AGREEMENT; MODIFICATION.
This Agreement contains the entire understanding of the parties with
respect to the transactions contemplated hereby and supersedes all agreements
and understandings entered into prior to the execution hereof. This Agreement
may be modified only by a written instrument duly executed by or on behalf of
(i) the Company, (ii) each Holder, and (iii) for 24 months after the Effective
Time, BGAH and NOVA. No breach of any covenant, agreement, warranty or
representation shall be deemed waived unless expressly waived in writing by or
on behalf of the party who might assert such breach.
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11.8 COUNTERPARTS.
For the convenience of the parties hereto, any number of counterparts
of this Agreement may be executed by the parties hereto, but all such
counterparts shall be deemed one and the same instrument.
11.9 NOTICES.
All notices, consents, requests, demands, and other communications
hereunder shall be in writing and shall be given by hand or by mail (return
receipt requested) or sent by overnight delivery service, cable, telegram, or
facsimile transmission to the parties at the address specified beside each
party's name on the signature pages hereto or at such other address as shall be
specified by the parties by like notice.
Notice so given shall, in the case of notice so given by mail, be
deemed to be given and received on the fourth business day after posting, in the
case of notice so given by overnight delivery service, on the day after notice
is deposited with such service, and in the case of notice so given by cable,
telegram, facsimile transmission or, as the case may be, personal delivery, on
the date of actual delivery.
11.10 GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO ANY CHOICE
OF LAW PRINCIPLES WHICH MIGHT REQUIRE OR PERMIT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION.
11.11 SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon and shall inure to the benefit of
and be enforceable by and against the successors and permitted assigns of the
parties hereto.
11.12 PARTIES IN INTEREST.
Except as otherwise specifically provided herein and for BG and NOVA,
nothing in this Agreement expressed or implied is intended or shall be construed
to confer any right or benefit upon any person, firm or corporation other than
Stockholder and the Company and their respective successors and permitted
assigns.
11.13 EFFECTIVE TIME.
This Agreement shall be effective at the Effective Time and will be
null and void and of no effect upon the termination of the Merger Agreement in
accordance with its terms.
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.
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IN WITNESS WHEREOF, Stockholder and the Company have caused this
Registration Rights Agreement to be duly executed as of the date first above
written.
ENERGY CONVERGENCE
HOLDING COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxx
-----------------------------------
Title: President
-----------------------------------
Address: 0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: President
Telecopier: (000) 000-0000
CHEVRON U.S.A. INC.
By: /s/ X.X. Xxxxxxxxx
-----------------------------------
Name: X.X. Xxxxxxxxx
-----------------------------------
Title: Executive Vice President
-----------------------------------
Address: 0000 XxXxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: President of Chevron U.S.A.
Production Company
Telecopier: (000) 000-0000
with copies to:
Xxxxxx X. Xxxxxx
Vice President and General Counsel
Chevron Corporation
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telecopier: (000) 000-0000
and:
Xxxxx Xxxxxxx Xxx, Esq. and
Xxxxxx X. Xxxx, Esq.
Pillsbury Madison & Sutro LLP
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Telecopier: (000) 000-0000
