EXHIBIT 10.15
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AMENDATORY AGREEMENT NO. 3 dated as of October 1, 1997, to the
Shareholders' Agreement dated as of December 6, 1991, as amended (the
"Shareholders' Agreement"), among E.I. DU PONT DE NEMOURS AND CO., a Delaware
corporation ("Du Pont"), DU PONT ENERGY COMPANY, a Delaware corporation ("DEC"),
CONSOL ENERGY INC., a Delaware corporation ("CEI"), RHEINBRAUN AG, a German
corporation ("Rheinbraun"), and RHEINBRAUN US GMBH, a German corporation ("RG").
WHEREAS, Du Pont, DEC, CEI, and Rheinbraun have entered into an Option
(Class A Shares) Agreement, dated as of this date (the "Option Agreement"),
granting to Rheinbraun the option (the "Option") to purchase 50,000 Class A
Shares (the "Class A Shares") of CEI owned by DEC;
WHEREAS, the Option Agreement provides that, upon exercise by
Rheinbraun of the Option, the purchase of Class A Shares thereunder is to be
made pursuant to a Share Purchase Agreement in form attached as Exhibit A to the
Option Agreement (the "SPA");
WHEREAS, the parties hereto intend that the exercise of the Option
will vest in Rheinbraun control over CEI, while expiry of the Option will
entitle Du Pont to dispose of Class A Shares in a public offering (without
prejudice to its right to dispose of Class A Shares under the Shareholders'
Agreement);
WHEREAS, in consequence of the foregoing, the parties hereto are
entering into this Amendatory Agreement to provide that, upon exercise or expiry
of the Option the Shareholders' Agreement shall be further amended as herein
provided;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
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Definitions
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Terms used herein without definition that are defined in the
Shareholders' Agreement shall have the meanings, respectively, specified in the
Shareholders' Agreement, and the following terms shall have the meanings
assigned to them below:
"Closing" shall mean the closing specified in Article III of the SPA.
"Closing Date" shall mean the date of the Closing specified in Article
III of the SPA.
"Coal Group" shall mean CEI and its Subsidiaries, and a "member of the
Coal Group" shall be any one of CEI or such Subsidiaries.
"Subsidiary" shall mean, with respect to another person, a
corporation, partnership, trust, or other legal entity controlled by such other
person, directly or indirectly. An entity shall be deemed subject to the control
of another person
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when such person, directly or indirectly, has the power to direct or cause the
direction of the management and policies of such entity.
"Underwriting Agreement" shall mean an agreement between CEI and
underwriters to effect an underwritten, registered public offering of Class A
Shares.
ARTICLE II
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Exercise of Option
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1. Rheinbraun Control; Suspension of Shareholders' Agreement. If
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Rheinbraun shall exercise the Option, then, effective immediately upon the
exercise of the Option, the following provisions shall apply:
(a) Rheinbraun shall assume exclusive managerial control over the
Coal Group and, to that end, (i) Du Pont shall cause each of the directors of
CEI nominated by Du Pont to deliver to CEI, with a copy to Rheinbraun, written
resignations from all directorships in the Coal Group held by him, and (ii) Du
Pont shall cause DEC to execute and deliver to Rheinbraun its irrevocable proxy,
in substantially the form of Exhibit A hereto, authorizing officers of
Rheinbraun identified therein to act in the place of DEC with respect to the
Class A Shares in all respects, as such officers may determine; and,
(b) All provisions of the Shareholders' Agreement shall be suspended
and without contractual force except the following: sections 4.2 (subject,
however, to section 2(b) of the
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Option Agreement), 6.4, and Article VII; provided, that, nothing in this section
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1 shall entitle Rheinbraun to amend the Certificate of Incorporation or By-laws
of CEI, to amend further the Shareholders' Agreement, or to cause any member of
the Coal Group to do any act prior to the Closing Date of the type referred to
in item 4 (Certain Capital Expenditures), item 6 (New Lines of Business) or item
13 (New Business with Stockholders) of Annex G of the Shareholders' Agreement
without the prior written consent of Du Pont.
2. Closing; Termination of Shareholders' Agreement. Upon the
-----------------------------------------------
acquisition by Rheinbraun of title to 50,000 Class A Shares at the consummation
of the Closing, then, automatically and without the necessity of further action
by the parties, (a) the Shareholders' Agreement shall terminate and be of no
further force or effect as of the Closing Date, and (b) each of the parties
hereto shall be deemed to have released and forever discharged every other party
to the Shareholders' Agreement from every liability and obligation that any of
them may have to the releasing party arising from the making and performance of
the Shareholders' Agreement.
3. Termination Without Closing. If the SPA shall be terminated as
---------------------------
provided therein, or otherwise cancelled or discharged, without consummation of
the Closing, then, as of the date of such termination, cancellation or
discharge, (a) the resignations and proxy delivered pursuant to section 1 of
this Article II shall be void, and said directors (or their respective
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successors appointed by Du Pont) shall reassume the directorships from which
they resigned and (b) the Shareholders' Agreement shall be reinstated and
continue in full force and effect and, to the extent practicable, the rights and
obligations of the parties to the Shareholders' Agreement, and the status of the
boards of directors of the Coal Group and the voting rights of DEC as holder of
the Class A Shares, shall be restored to their status as of the date and prior
to the execution hereof.
ARTICLE III
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Public Offering
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1. Right to Make Offering. If the Option shall expire unexercised,
----------------------
Du Pont shall be entitled to dispose of all or part of the Class A Shares in the
manner, and upon the conditions, specified in this Article and in Exhibit B
(Registration Rights), annexed hereto. For the purposes of this Amendatory
Agreement, Du Pont shall include DEC.
2. (a) Procedures. Until December 31, 2001, Du Pont may distribute
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Class A Shares to the public by means of (i) a spin-off stock dividend to
shareholders of Du Pont or (ii) a registered public offering pursuant to an
Underwriting Agreement as provided in Exhibit B. Not more than 60 days after
expiry of the Option, Du Pont shall give written notice to Rheinbraun and CEI
(the "2(a) Notice") of the method that it has elected to employ to make such
distribution and shall thereafter proceed according to such method; provided,
--------
that, Du Pont may amend the
----
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2(a) Notice once, not more than 180 days after expiry of the Option. The 2(a)
Notice shall include any proposal of Du Pont to change the capitalization of
CEI, by stock-split or otherwise, for the purposes of such distribution, and, if
Rheinbraun and CEI shall consent to such proposal (which consent shall not be
unreasonably withheld), corresponding changes shall be made in the Certificate
Incorporation and By-laws of CEI to give effect thereto. Any shares issued by
CEI in exchange for or in lieu of Class A Shares shall be deemed Class A Shares
for the purpose hereof.
(b) Breadth of Distribution. In any public offering made pursuant to
-----------------------
this Article and Exhibit B, Du Pont shall cause its underwriters to (i) effect
as wide a distribution of the Class A Shares as is practicable; (ii) prevent the
sale of Class A Shares to any person that would, following such sale,
beneficially own more than 4.9% of the outstanding shares of CEI after
completion of such offering; and (iii) treat Rheinbraun equally with
institutional investors and other offerees to whom Class A Shares are offered
for sale in the first such offering.
(c) Rheinbraun Cooperation. In connection with any public offering
----------------------
made pursuant to this Article and Exhibit B, Rheinbraun will use its reasonable
best efforts to (i) cause CEI to perform its obligations under this Article and
Exhibit B, and (ii) take such other actions as are reasonably requested by Du
Pont, or required by law, to expedite or facilitate the registration,
qualification or distribution of the number of
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Class A Shares included in such offering in accordance with this Article and
Exhibit B.
ARTICLE IV
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Effects on Shareholders' Agreement
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1. Complete Disposition. If Du Pont and DEC shall dispose of all
--------------------
Class A Shares in conformity with Article III hereof, then, as of the date of
the final such disposition, (a) the Shareholders' Agreement shall terminate and
be of no further force or effect, and (b) each of the parties hereto shall be
deemed to have released and forever discharged every other party to the
Shareholders' Agreement from every liability and obligation that any of them may
have to the releasing party arising from the making and performance of the
Shareholders' Agreement.
2. Partial Disposition. So long as Du Pont shall own any of the
-------------------
Class A Shares, the Shareholders' Agreement (including section 4.2 thereof)
shall be binding on Du Pont, and shall apply to such Shares, in accordance with
its terms as amended heretofore and hereby; provided, that, if part of the Class
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A Shares shall have been distributed in a public offering in conformity with
Article III hereof, only the following provisions of the Shareholders' Agreement
shall continue so to bind Du Pont: sections 4.2 as amended by section 3 of this
Article (for the purpose of which Du Pont and Rheinbraun shall be deemed the
sole
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shareholders of CEI), 6.4, 7.1 (in relation to Class A Shares held by Du Pont),
7.2, 7.3, and 7.5 through 7.12 (inclusive).
3. Amendment of Section 4.2.1. If the Option shall expire
--------------------------
unexercised, section 4.2.1 of the Shareholders' Agreement shall be deemed
amended as of October 1, 1998, to read as set forth in Exhibit C (Amended
Section 4.2.1) annexed hereto.
ARTICLE V
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Miscellaneous
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1. Assignment. By written notice to Rheinbraun and CEI, Du Pont may
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nominate a Subsidiary of Du Pont to exercise the rights granted by Article III
hereof. Any other purported assignment of any right or privilege by one party
hereto without the prior written consent of all other parties hereto shall be
void.
2. Incorporation by Reference. Sections 7.4 through 7.12 (inclusive)
--------------------------
of the Shareholders' Agreement are incorporated by reference as if fully set
forth herein and shall apply to this Amendatory Agreement irrespective of the
termination of the Shareholders' Agreement.
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IN WITNESS WHEREOF, DU PONT, DEC, CEI, RHEINBRAUN, and RG have caused
this Agreement to be duly executed, all as of the day and year first above
written.
E.I. DU PONT DE NEMOURS AND COMPANY
By:/s/ Xxxx X. Xxxxxxx ATTEST:
-----------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President and Treasurer
/s/ X. X. Xxxxxxxxx
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Secretary
DU PONT ENERGY COMPANY
By:/s/ Xxxx X. Xxxxxxx ATTEST:
-----------------------------------
Name:
Title: President
/s/ SIGNATURE ILLEGIBLE^^
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Secretary
CONSOL ENERGY INC.
By:/s/ B. R. Xxxxx ATTEST:
-----------------------------------
Name:
Title: President
/s/ X. X. Xxxxxx
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Secretary
RHEINBRAUN AG
By: /s/ Xx. Xxxxxx Xxxxxxx By: /s/ Xxxxx X. Breloer
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Name: Xx. Xxxxxx Xxxxxxx Name: Xxxxx X. Breloer
Title: Vorsitzender d. Vorstandes Title: Mitglied d.
Vorstandes
RHEINBRAUN US GMBH
By: /s/ Xx. Xxxxx Xxxxxx By: /s/ Xx. Xxxx Xxxxxxxxxx
----------------------------------- -------------------------
Name: Xx. Xxxxx Xxxxxx Name: Xx. Xxxx Xxxxxxxxxx
Title: Geschaftsfuhrer Title: Geschaftsfuhrer
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EXHIBIT A to Amendatory Agreement
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IRREVOCABLE PROXY
The undersigned, DUPONT ENERGY COMPANY, a Delaware corporation ("DEC"), is
a holder of 50,000 shares of class A Common Stock of Consol Energy Inc., a
Delaware corporation, represented by Certificate No. ______ (the "Shares"). DEC
hereby irrevocably appoints Xx. Xxxxxx Xxxxxxx or Xx. Xxxxx Xxxxxx or Xx. Xxxx
Xxxxxxxxxx, or any of them, with full power of substitution, as its attorney and
proxy to attend meetings, vote, give consents and in all other ways act in the
place of DEC with respect to all the shares (and any and all shares or other
securities issued in respect of the Shares).
This proxy is made pursuant to section 212 of the Delaware General
Corporation Law and an Amendatory Agreement dated as of _______, 1997, among
DEC, Rheinbraun A.G., and others relating to the sale of the Shares by DEC to
Rheinbraun A.G. and is therefore coupled with the interest provided thereby.
DATED: ____________
DUPONT ENERGY COMPANY
By: __________________________
ATTEST:
___________________________
Secretary
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EXHIBIT B to Amendatory Agreement
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REGISTRATION RIGHTS
1.1. Agreement to Register. CEI agrees to register the Class A
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Shares, any other securities issued in exchange therefor (including by way of
stock split or in connection with a combination of shares, recapitalization, or
otherwise) and any other securities issued as a dividend thereon (the
"Registrable Securities") upon the terms and subject to the conditions set forth
in this Exhibit B and in the Amendatory Agreement to which this Exhibit is
annexed.
(a) Demand Registration. On not more than two occasions prior to
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December 31, 2001, if Du Pont (i) requests in writing (a "Registration Request")
that CEI register the sale or other distribution under the Securities Act of
1933, as amended (the "Securities Act") of any of the Registrable Securities
(which request shall specify the number of Registrable Securities intended to be
offered and sold), (ii) expresses Du Pont's present intent to offer such
Registrable Securities for distribution, (iii) describes the nature or method of
the proposed offer and sale thereof, and (iv) undertakes to provide all such
information and materials relating to Du Pont and to take all such action as may
be required of Du Pont in order to permit CEI to comply with all applicable
requirements of the Securities and Exchange Commission (the "Commission") and to
obtain acceleration of the effective date of the registration statement
therefor, CEI shall use all reasonable efforts to cause the offering of the
Registrable Securities so specified in such request to be registered as soon as
reasonably practicable so as to permit the sale or other distribution by Du Pont
of the Registrable Securities specified in the Registration Request, and shall
in connection therewith prepare and file on an appropriate form, as CEI shall
reasonably determine, a registration statement under the Securities Act to
effect such registration. Notwithstanding any provision to the contrary
contained herein, CEI shall not be required to file any registration statement
pursuant to this section 1.1(a) in the following circumstances:
(i) if, in the reasonable judgment of Rheinbraun or CEI, a
registration at the time and on the terms requested would materially adversely
affect any financing by CEI that had been contemplated by Rheinbraun or CEI
prior to the notice by Du Pont requesting registration, CEI shall not be
required to commence using its best efforts to effect a registration pursuant to
this section until the earliest of (1) 90 days after the completion of such
financing, (2) the termination of any "black out" period
required by the underwriters, initial purchasers or placement agents, if any, in
connection with such financing or (3) promptly after abandonment of such
financing;
(ii) if, while a Registration Request is pending pursuant to
this section, Rheinbraun or CEI determines in good faith, based on the advice of
counsel, that proceeding with the registration would require the disclosure of
material information that Rheinbraun or CEI has a bona fide business purpose for
preserving as confidential, or CEI is unable to comply with Commission
requirements, CEI shall not be required to effect such pending registration
statement until the earlier of (1) the date upon which such material information
is disclosed to the public or ceases to be material or (2) 120 days after the
date CEI makes such determination; and
(iii) if Rheinbraun and CEI shall not have received undertakings
reasonably satisfactory to them from any underwriter or underwriters to
indemnify and hold them harmless, each of their directors and officers, and
every other controlling person of them, from and against any and all loss,
damage, liability, cost or expense to which they, any director or officer of
them, or every other controlling person of them may become subject under the
Securities Act or otherwise, insofar as such losses, damages, liabilities, costs
or expenses (A) are caused by any untrue or alleged untrue statement of any
material fact contained in the registration statement or prospectus included
therein, as amended or supplemented, or (B) arise out of or are based upon the
omission or the alleged omission to state therein a 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, in each case to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was so made in conformity with written information furnished by
such underwriter or underwriters.
(iv) The right of Du Pont to exercise registration rights
pursuant to section 1.1(a) shall be subject to the condition that the first
Registration Request of Du Pont shall be for not less than 20,000 Class A Shares
(or equivalent).
(b) Registration Expenses. Du Pont shall bear the costs and
---------------------
expenses incurred in connection with the registration of the sale or other
distribution of the Registrable Securities pursuant to the terms of this section
1.1 (or, if securities are included in any such registration for the account of
CEI or any other security holders, Du Pont shall bear its proportionate share of
such costs and expenses, except Du Pont shall pay any
2
underwriting fees, discounts or commissions attributable to sales of Registrable
Securities by Du Pont and any "out-of-pocket" expenses of Du Pont, including Du
Pont's counsel's fees and expenses) including, without limitation, (i) all
filing fees with the Commission; (ii) fees and expenses of compliance with
securities or blue sky laws (including fees and disbursements of counsel in
connection with blue sky qualifications of the Registrable Securities, (iii)
printing expenses, (iv) the fees and expenses incurred in connection with the
listing of the Registrable Securities, (v) fees and expenses of counsel and
independent certified public accountants for the Company (including the expenses
of any comfort letters).
(c) Other Registration Provisions and Procedures. Any registration
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under this section 1.1 shall be subject to the following procedures:
1. As to any proposed offer or sale of Registrable Securities, such
securities shall cease to be Registrable Securities where (a) a
registration statement with respect to the sale of such
securities shall have become effective under the Securities Act
and such securities shall have been disposed of in accordance
with such registration statement, or (b) such securities have
been transferred or sold to any individual or entity other than
Du Pont or any affiliate of Du Pont.
2. Upon any registration under section 1.1 of this Exhibit becoming
effective, CEI will use its best efforts to keep such
registration statement current for a period of 90 days or such
shorter period which will terminate when all Registrable
Securities covered by such registration statement have been sold.
3. A Registration Request shall not be deemed to have been made for
purposes of the first sentence of section 1.1(a) hereof:
(a) if, after a registration statement has become effective,
such registration statement is interfered with by any stop
order, injunction or other order or requirement of the
Commission or other governmental authority for any reason
other than an act or omission of Du Pont;
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(b) if the conditions to closing specified in any purchase
agreement or underwriting agreement entered into in
connection with such registration are not satisfied other
than by reason of some act or omission by Du Pont; or
(c) if CEI voluntarily takes any action that would result in Du
Pont not being able to sell such Registrable Securities
covered thereby; or
(d) if Du Pont notifies CEI in writing of Du Pont's intention
not to proceed with a registration prior to execution of an
underwriting agreement relating to that Registration
Request.
4. In connection with any offering of Registrable Securities
pursuant to this Exhibit, CEI (a) will furnish to Du Pont and the
underwriters such number of copies of any prospectus (including
any preliminary prospectus) and prospectus supplement as Du Pont
or such underwriters may reasonably request in order to effect
the offering and sale of the Registrable Securities to be offered
and sold, but only while CEI shall be required under the
provisions hereof to cause the registration statement to remain
current, and (b) take such action as shall be necessary to
qualify the Registrable Securities covered by such registration
under blue sky or other state securities laws for offer and sale
as Du Pont or the underwriters shall request; provided, however,
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that CEI shall not be obligated to qualify as a foreign
corporation to do business under the laws of any jurisdiction in
which it shall not be then qualified or to file any general
consent to service of process or to subject itself to taxation in
any jurisdiction wherein it would not otherwise be subject to
taxation but for the requirement of this paragraph.
5. The underwriters acting hereunder shall be selected by Du Pont
with the prior written approval of Rheinbraun and CEI (which
approval shall not be unreasonably withheld). Any underwriting
agreement made hereunder shall be subject to the prior written
approval of Du Pont
4
and Rheinbraun (which approval shall not be unreasonably
withheld).
6. In connection with any offering of Registrable Securities
registered pursuant to this Agreement, CEI shall (a) furnish Du
Pont, at CEI's expense, with certificates not containing legends
affecting resales under the securities laws of the United States
or any State representing ownership of the Registrable
Securities, in such denominations as Du Pont shall request, which
are sold pursuant to the prospectus contained in the registration
statement.
7. In connection with CEI's obligations under section 1.1(a) hereof,
CEI will:
(a) prepare and file with the SEC within 90 days after receipt
of a Registration Request with respect to such Registrable
Securities (except as otherwise permitted by section 1.1(a)
of the Agreement), a registration statement on any form for
which CEI then qualifies and which shall be appropriate to
effect the intended method of distribution and which form
shall be available for the sale of the Registrable
Securities in accordance with the intended method of
distribution thereof; provided, however, that the
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registration statement, if other than on Form S-1, will
contain such additional information in compliance with
securities laws as the underwriters deem necessary or
appropriate for marketing purposes and which shall be
reasonable and customary, and use its best efforts to cause
such registration statement to become and remain effective;
and before filing a registration statement or prospectus or
any amendments or supplements thereto relating to a
registration pursuant to section 1.1(a) hereof, CEI will
furnish to Du Pont and counsel selected by Du Pont (and the
underwriters) copies of all such documents proposed to be
filed, and CEI will not file any registration statement to
which Rheinbraun or Du Pont or their respective counsel (or
the underwriters) shall reasonably object;
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(b) cooperate and assist in any filings required to be made with
a securities exchange or the National Association of
Securities Dealers, Inc.;
(c) cause the prospectus to be supplemented by any required
prospectus supplement, and as so supplemented to be filed
pursuant to the Securities Act;
(d) notify Du Pont promptly: (i) when the prospectus or any
prospectus supplement or post-effective amendment has been
filed, and, with respect to the registration statement or
any post-effective amendment, when the same has become
effective; (ii) of any request by the Commission for any
amendments or supplements to the registration statement or
the prospectus or for additional information; (iii) of the
issuance by the Commission of any stop order suspending the
effectiveness of the registration statement or the
initiation of any proceedings for that purpose; (iv) if, at
any time prior to the closing contemplated by an
underwriting agreement entered into in connection with such
registration statement, that the representations and
warranties of CEI contained therein cease to be true and
correct; (v) of the receipt by CEI of any notification with
respect to the suspension of the qualification of the
Registrable Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such
purpose; and (vi) of the happening of any event which makes
any statement in the prospectus or any document incorporated
therein by reference untrue and which requires the making of
any changes in the registration statement, the prospectus or
any document incorporated therein by reference in order to
make the statements therein not misleading;
(e) make reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of the registration
statement;
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(f) furnish to Du Pont, without charge, one copy of the
registration statement as declared effective by the
Commission and any post-effective amendment thereto,
including financial statements and schedules, all documents
incorporated therein by reference and all exhibits
(including those incorporated by reference);
(g) upon the occurrence of any event referred to in paragraph
7(d)(vi) of this section, prepare a supplement or post-
effective amendment to the registration statement, the
related prospectus or any document incorporated therein by
reference or file any other required document so that, as
thereafter delivered to purchasers of the Registrable
Securities, the prospectus will not contain an untrue
statement of a material fact or omit to state any material
fact necessary to make the statements therein not
misleading;
(h) use reasonable efforts to cause all Registrable Securities
covered by the registration statement to be listed on a
securities exchange if requested by Du Pont or the
underwriters;
(i) use reasonable efforts to obtain (i) for delivery at each
closing of the sale of Registrable Securities, opinions of
counsel to CEI and updates thereof addressed to the
underwriters, if any, of such sale covering the matters
customarily covered in opinions requested in underwritten
offerings and such other matters as may be reasonably
requested by the underwriters, if any, and (ii) "cold
comfort" letters and updates thereof from the Company's
independent certified public accountants addressed to the
underwriters, if any, of such sale, such letters to be in
customary form and covering matters of the type customarily
covered in "cold comfort" letters by accountants in
connection with underwritten offerings, which shall be
delivered at the time of effectiveness of the
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registration statement and at each closing of the sale of
Registrable Securities;
(j) participate and cause such members of its management as the
underwriters shall reasonably request (and which shall be
customary) to participate in "road shows" and similar
promotional meetings to the extent reasonably requested by
the underwriters; and
(k) otherwise use its reasonable efforts to comply with all
applicable law and rules and regulations of the Commission.
1.2. Public Offering Indemnities. In the event of any registered
---------------------------
offering of Registrable Securities pursuant to section 1.1 hereof:
(a) CEI will indemnify and hold harmless, to the fullest extent
permitted by law, Du Pont, Rheinbraun, and any underwriter, as defined in the
Securities Act, and each person, if any, who controls Du Pont, Rheinbraun, or
such underwriter within the meaning of the Securities Act, from and against any
and all losses, damages, claims, liabilities, joint or several, reasonable costs
and expenses (including any amounts paid in any settlement effected with CEI's
consent) to which Du Pont, Rheinbraun, or any such underwriter or controlling
person may become subject under the Securities Act, state securities or blue sky
laws, common law or otherwise, insofar as such losses, damages, claims,
liabilities (or actions or proceedings in respect thereof), costs or expenses
arise out of or are based upon (i) any untrue statement or alleged untrue
statement of any material fact contained in the registration statement or the
prospectus included therein, as amended or supplemented, or (ii) the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances in
which they are made, not misleading, and CEI will reimburse Du Pont, Rheinbraun,
any underwriter, and each such controlling person, promptly upon demand, for any
legal or any other expenses incurred by them in connection with investigating,
preparing to defend or defending against such loss, damage, claim, liability,
action or proceeding; provided, however, that CEI will not be liable in any such
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case to the extent that any such loss, damage, liability, cost or expense arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission so made in conformity with information furnished by
Du Pont, Rheinbraun, such underwriter or such controlling persons,
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as the case may be, in writing specifically for use in the preparation thereof,
provided, further, that CEI will not be liable under the indemnity agreement of
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this section to Du Pont, Rheinbraun, or any underwriter (or controlling person
of any of them) with respect to any preliminary prospectus to the extent that
any such loss, damage, liability, cost or expense results from the fact that
Registrable Securities were sold by any such indemnitee to a person to whom
there was not sent or given, at or prior to the written confirmation of such
sale, a copy of the final prospectus as then amended or supplemented if CEI has
previously furnished copies thereof to Du Pont, Rheinbraun, such underwriter or
such controlling person as the case may be. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of Du
Pont, Rheinbraun, any underwriter and shall survive the transfer of such
Registrable Securities by Du Pont.
(b) Du Pont shall indemnify and hold harmless Rheinbraun and CEI,
each director of Rheinbraun and CEI, each officer of CEI who signs such
registration statement, any underwriter, and each person, if any, who controls
CEI or Rheinbraun or such underwriter from and against any and all loss, damage,
liability, cost or expense to which Rheinbraun or CEI or any such controlling
person or any underwriter may become subject under the Securities Act or
otherwise, insofar as such losses, damages, liabilities, costs or expenses (i)
are caused by any untrue or alleged untrue statement of any material fact
contained in the registration statement or included prospectus, as amended or
supplemented, or (ii) arise out of or are based upon the omission or the alleged
omission to state therein a 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, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was so made in conformity with written information furnished by
Du Pont to CEI for use therein.
(c) Rheinbraun shall indemnify and hold harmless Du Pont and CEI,
each director of Du Pont and CEI, each officer of CEI who signs such
registration statement, any underwriter, and each person, if any, who controls
CEI or Du Pont or such underwriter from and against any and all loss, damage,
liability, cost or expense to which Du Pont or CEI or any such controlling
person or any underwriter may become subject under the Securities Act or
otherwise, insofar as such losses, damages, liabilities, costs or expenses (i)
are caused by any untrue or alleged untrue statement of any material fact
contained in the registration statement or included prospectus, as amended or
supplemented, or
9
(ii) arise out of or are based upon the omission or the alleged omission to
state therein a 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, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission was
so made in conformity with written information furnished by Rheinbraun to CEI
for use therein.
(d) Promptly after receipt by an indemnified party pursuant to the
provisions of subsection (a), (b), or (c) of this section of written notice of
the commencement of any action with respect to which a claim for indemnity may
be made pursuant to this section, such indemnified party will, if a claim
thereof is to be made against the indemnifying party pursuant to the provisions
of said subsection (a), (b), or (c) promptly notify in writing the indemnifying
party of the commencement thereof; but the omission to notify the indemnifying
party will not relieve it from any liability which it may have otherwise to any
indemnified party. In case such action is brought against any indemnified party
and it notifies the indemnifying party of the commencement thereof, the
indemnifying party shall have the right to participate in, and, to the extent
that it may wish, jointly with any other indemnifying party similarly notified,
to assume the defense thereof; provided, that, if the defendants in any action
-------- ----
include both the indemnified party and the indemnifying party and there is a
conflict of interest that would prevent counsel for the indemnifying party from
also representing the indemnified party, the indemnified parties shall have the
right to select one separate counsel to participate in the defense of such
action on behalf of all such indemnified parties. After notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party pursuant to the provisions of said subsection (a), (b), or (c) for any
legal or other expense subsequently incurred by such indemnified party in
connection with the defense thereof, other than reasonable costs of
investigation, unless (i) the indemnified party shall have employed counsel in
accordance with the provision of the immediately preceding sentence or (ii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party. No indemnifying party will
consent to entry of any judgment, or enter into any settlement with respect to a
claim, without the written consent of the indemnified party (which consent shall
not be unreasonably withheld) or unless such judgment or settlement includes as
an unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all
10
liability in respect to such claim or litigation. No indemnified party shall
consent to entry of any judgment or enter into any settlement of any action the
defense of which has been assumed by an indemnifying party without the consent
of such indemnifying party, which consent shall not be unreasonably withheld.
(e) If recovery is not available under the foregoing indemnification
provisions or is insufficient to hold harmless an indemnified party in respect
of any losses, claims, liabilities, costs or expenses specifically covered by
the indemnification provisions set forth above for any reason other than as
specified in section 1.2(a), (b), or (c), the parties entitled to
indemnification by the terms thereof shall be entitled to contribution to
losses, claims, liabilities, costs and expenses as may be more fully set forth
in an underwriting agreement to be executed in connection with such
registration, except to the extent that contribution is not permitted under
section 11(f) of the Securities Act. In determining the amount of contribution
to which the respective parties are entitled, there shall be considered the
relative benefits and faults and any other equitable considerations appropriate
under the circumstances provided in section 11(f) of the Securities Act. 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 contribution
provided for in this section shall survive, with respect to a holder of
Registrable Securities, the transfer of Registrable Securities by such holder,
and, with respect to a holder of Registrable Securities or CEI, shall remain in
full force and effect regardless of any investigation made by or on behalf of
any indemnified party.
1.3. Holdback Provision. Rheinbraun and CEI agree not to effect any
------------------
public sale of equity securities of CEI (or securities convertible into or
exchangeable for such equity securities) during the seven days prior to and the
90 days after any underwritten registration pursuant to this Exhibit B has
become effective, or such longer period (not to exceed 180 days) as the
underwriter may reasonably request consistent with customary practice.
11
Exhibit C to Amendatory Agreement
---------------------------------
Amended Section 4.2.1
as of October 1, 1998
---------------------
4.2.1 During any period that members of the Du Pont Group and the
Rheinbraun Group shall be the sole shareholders of CEI, the provisions of this
paragraph 4.2.1 shall apply to any purported disposition of Shares by any such
shareholder. Du Pont and Rheinbraun each guarantee that the obligations imposed
by this paragraph shall be duly performed by any shareholder that is a member,
respectively, of the Du Pont Group or the Rheinbraun Group.
(a) The Seller shall give written notice to the Offeree (the "Option
Notice") of the terms and conditions upon which the Seller may
desire to sell the Offered Shares to a third party or parties.
(b) The Offeree shall, within 30 days after receipt of the Option
Notice, give written notice to the Seller whether it elects to
purchase not less than all the Offered Shares on the terms and
conditions set forth in the Option Notice.
(c) If the Offeree shall elect to purchase the Offered Shares, the
Offeree's notice of election shall
specify a date, not later than 30 days after the receipt by the
parties of all necessary governmental or other regulatory
approvals for such purchase, or, if no such approvals are
required, not later than 60 days after the Offeree's receipt of
the Option Notice, for the closing of such purchase. The giving
of a notice in such form shall bind the Offeree to purchase, and
the Seller to sell and transfer, on the date of the closing so
specified, the Offered Shares on the terms and conditions stated
in the Option Notice, and shall also bind the Seller and Offeree
to pursue diligently the obtaining of all such governmental and
regulatory approvals. In any such sale the Seller shall be deemed
to have warranted to the Offeree that the Seller has good and
unencumbered title to the Offered Shares.
(d) If the Offeree, by notice to the Seller, shall elect not to
exercise its right to purchase the Offered Shares, or if 30 days
shall have elapsed from the date of receipt of the Option Notice
by the Offeree without such election having been notified to the
Seller, then the Seller may sell and transfer the Offered Shares
to any third party or parties in a single transaction if such
sale
shall be on terms and conditions no less favorable to Seller than
the terms and conditions stated in the Option Notice; provided,
--------
that the following condition shall have been satisfied: the
Seller shall have given written notice (the "Identification
Notice") to the Offeree of the identity of such third party or
parties together with a copy of (i) a letter of intent executed
by all parties (but only if such letter of intent has been
publicly disclosed), or, alternatively, (ii) a definitive,
integrated agreement of sale executed by all parties (which
agreement or letter of intent, as the case may be, shall include
provision for a closing to be consummated not sooner than the
40th day following the date of delivery to the Offeree of the
Identification Notice subject to the terms of this subparagraph),
and the Offeree shall have the option, exercisable by written
notice delivered to the Seller prior to the 30th day following
the date of delivery to the Offeree of the Identification Notice,
to purchase the Offered Shares on the terms and conditions
specified in such letter of intent or agreement of sale, as the
case may be, except that the amount payable by the Offeree shall
be 104% of the
economic value of the cash, stock and any other property
specified in such letter of intent or agreement of sale as the
price of the Offered Shares. If the Offeree shall exercise such
option, the Offeree shall be bound to purchase, and the Seller to
sell and transfer to the Offeree, the Offered Shares on a closing
date not later than the 30th day following the receipt of all
necessary governmental and regulatory approvals, but if no such
approvals are required, not later than the 60th day following the
date of delivery of the Identification Notice. The exercise of
such option by the Offeree shall bind the Seller and Offeree to
pursue diligently the obtaining of all such necessary
governmental and regulatory approvals. In any such sale the
Seller shall be deemed to have warranted to the Offeree that the
Seller has good and unencumbered title to the Offered Shares.
(e) If the Seller shall not have completed the transfer of all of the
Shares referred to in the Option Notice to a third party or
parties in a single transaction on or before the first
anniversary of the date of the Option Notice, the restrictions on
transfer imposed by this Article
shall again apply to any proposed transfer of such Shares.
