EXHIBIT 10.7
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") dated as of
November 9, 2001, is by and between Enron Corp., an Oregon corporation (the
"COMPANY"), and Dynegy Inc., an Illinois corporation ("STOCKHOLDER").
WHEREAS, the Company, Northern Natural Gas Company, a Delaware
corporation ("Northern"), and Stockholder entered into a Subscription Agreement
dated the date hereof pursuant to which Stockholder will purchase shares of
Series A Preferred Stock, par value $0.01 per share, of Northern ("Series A
Preferred Stock") that may be exchanged for Common Stock, no par value, of the
Company ("Common Stock") pursuant to an Exchange Agreement dated the date hereof
by and between the Company and Stockholder (the "Exchange Agreement");
WHEREAS, in connection with the Exchange 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.
"COMMON STOCK" shall have the meaning set forth in the recitals hereto.
"COMPANY" shall have the meaning set forth in the preamble hereto.
"COMPANY REGISTRATION" is defined in Section 3.1.
"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 in accordance with Section 9.1 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.
"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.
"MATERIAL EVENT" shall have the meaning set forth in Section 4.1(k).
"MERGER AGREEMENT" shall have the meaning set forth in the recitals
hereto.
"PARTICIPATING HOLDERS" shall have the meaning set forth in Section
2.2(a).
"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.
"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
exchange of the Series A Preferred Stock, 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. Common
Stock shall cease to be Registrable Common Stock when (i) it has been disposed
of in a transaction registered under the Securities Act, (ii) it has been sold
pursuant to Rule 144 under the Securities Act, (iii) it is held by a Person not
entitled to the benefits of this Agreement under Section 9.1, (iv) at such time
as the Registrable Common Stock held by such holder constitutes less than 1% of
the then outstanding shares of Common Stock and such shares could be sold
without registration pursuant to Rule 144 under the Securities Act, or (v) it
has otherwise been transferred in circumstances where no restrictive legend is
required on the certificate for such shares because no restriction on transfer
exists.
"SEC" shall mean the United States Securities and Exchange Commission.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SERIES A PREFERRED STOCK" shall have the meaning set forth in the
recitals hereto.
"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) 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 commercially reasonable 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) Holders of a majority of the Registrable Common Stock to
be included in such registration 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 the Company shall not be required to register
Registrable Common Stock pursuant to this Section 2.1 more than once in any
270-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 to six
(6) requests to register Registrable Common Stock under the terms of Section
2.1. 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 by one or more Holders; provided, however, that
if the Company shall have substantially completed its requirements to permit the
sale of the Registrable Common Stock and all Holders participating in any such
registration (the "Participating Holders") determine to withdraw such
registration or not to effect sales of Registrable Common Stock pursuant to such
registration, then a "request" shall be deemed to have occurred unless either
(i) such withdrawal or determination not to effect sales resulted from an
adverse change in the Company's circumstances or (ii) the Participating Holders
pay the Company's out-of-pocket expenses associated with such registration.
(b) The Company shall be entitled to defer for a reasonable
period of time, but not to exceed ninety (90) days in the aggregate, 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) business
days after such Holder requested the registration under Section 2.1 that the
Company (i) is at such time conducting or is about to conduct an underwritten
public offering of its securities for its own account and the Board of Directors
of the Company determines in
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good faith that such offering would be materially adversely affected by such
registration requested by the Holders or (ii) would be required (as determined
after consultation with counsel) 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(b), 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).
(c) The Holders shall not be entitled to 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.
(d) The Company shall not be obligated to effect a
registration pursuant to Section 2.1 above unless the shares of Registrable
Common Stock proposed to be included in such registration are reasonably
expected to have an aggregate sales price to the public of at least $100
million.
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 the Holders
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 such
Holders 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 such Holders, abandon the proposed offering in which such
Holders had requested to participate (provided that the Company gives such
Holders prompt notice of such decision); and provided further that such Holders
shall be entitled to withdraw any or all of their 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.
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3.2 RESTRICTIONS ON PIGGYBACK REGISTRATION RIGHTS.
Notwithstanding anything to the contrary contained elsewhere herein,
the registration rights granted to the Holders 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 each Participating Holder), that the success of
such offering would in its or their good faith judgment be adversely affected by
such 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 adversely affect 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. In addition, the Company shall not be obligated to include any
shares of Registrable Common Stock in any registration that is effected pursuant
to any of the agreements listed on Exhibit A hereto (the "Existing Registration
Rights Agreements") to the extent that such Existing Registration Rights
Agreements prohibit such inclusion.
(c) The Company shall use commercially reasonable best 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
Registrable Common Stock of any Holder in such offering unless such Holder
accepts the terms of the underwriting agreement between the Company and the
managing underwriter or underwriters. 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 adversely affect 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 adverse effect on the success of
such offering (but subject to existing priority requirements in the Existing
Registration Rights Agreements), to the Participating Holders 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 the
Participating Holders' shares of Registrable Common Stock are included in an
offering contemplated by a registration statement pursuant to this Section 3,
each Participating Holder shall execute one or more
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"lockup" letters, in customary form, setting forth an agreement by such
Participating Holder 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 ninety (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 the
Participating Holders shall be such lesser period of time.
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, unless the offering is a continuous offering of securities under Rule 415,
in which case the registration statement shall be kept effective until the first
anniversary of such effective date or, in either case, 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
Registrable 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 the Participating Holders 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 the
Participating Holders 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 the Participating Holders 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 the Participating Holders 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 the Participating Holders 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 the Participating Holders of any stop order issued or enforcement action
initiated or, to the
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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 best 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 the Participating Holders or underwriter shall reasonably request and
use its commercially reasonable best 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;
(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
best efforts to have such opinions and comfort letters addressed to and
delivered to each Participating Holder;
(g) Furnish unlegended certificates representing ownership of
the shares of Registrable Common Stock being sold in such denominations as shall
be requested by the Participating Holders 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 the Participating Holders (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 by the Participating Holders in accordance with the
intended method of disposition 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 120 days 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
earlier of (i) the date the offering is completed and (ii) the first anniversary
of such effective date), keep effective and maintain any registration,
qualification or approval obtained in connection with the offering of the shares
of
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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 best 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 the Participating
Holders 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 (a "Material
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 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 (subject to Section 4.3) make
available to the Participating Holders 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 Sections 4.1(a) and (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 the
Participating Holders such supplemented or amended prospectus;
(l) Make available for inspection during the normal business
hours of the Company by the Participating Holders, any underwriter participating
in such offering, and any attorney, accountant or other agent retained by the
Participating Holders 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 the Participating Holders; 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, (ii) any records, information or documents shall be
kept confidential by such Inspectors, unless (A) such records, information or
documents are in the public domain or otherwise publicly available or (B)
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) and (iii) the Company will not be required to waive any
privilege in connection with any such registration;
(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.
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(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 a Participating Holder, 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 the Participating Holders 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 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 the Participating
Holders;
(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 THE PARTICIPATING HOLDERS.
Each Participating Holder 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, the Participating Holder will forthwith discontinue
disposition of Registrable Common Stock pursuant to the registration statement
covering such Registrable Common Stock until the Participating Holder'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, the Participating
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Holder will deliver to the Company all copies, other than permanent file copies,
then in the Participating Holder's possession of the most recent prospectus
covering such Registrable Common Stock at the time of receipt of such notice.
4.3 DEFERRAL PERIOD.
Upon the occurrence or existence of any pending corporate development
or any other Material Event that, in the reasonable judgment of the Company,
makes it appropriate to suspend the availability of the registration statement
and the related prospectus or other offering document in connection with the
registration of shares of Registrable Common Stock, the Company shall give
notice to the Participating Holders that the availability of such registration
statement or other offering document is suspended (a "Deferral Notice") and,
upon receipt of the Deferral Notice, the Participating Holders agree not to sell
any Registrable Common Stock pursuant to such registration statement or other
offering document until receipt of copies of the supplemented or amended
prospectus or other offering document provided for in Section 4.1(k) above, or
until they are advised in writing by the Company that the prospectus or other
offering document may be used, and have received copies of any additional or
supplemental filings that are incorporated or deemed incorporated by reference
in such prospectus, if applicable. The period during which the availability of
such registration statement and any prospectus or other offering document is
suspended (the "Deferral Period") shall not exceed 120 days in any 12
consecutive calendar month period; provided, that a single Deferral Period shall
not exceed 45 days. The Company's obligations under Section 4.1 shall be
suspended during any Deferral Period.
SECTION 5.
RESTRICTIONS ON PUBLIC SALE BY THE COMPANY AND OTHERS
5.1 The Company agrees:
(a) Upon a written request from a Holder not to effect any
public sale or distribution of any Common Stock during the 30-day period
following the pricing of any firm commitment underwritten public offering
pursuant to 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 or
pursuant to commitments under the Existing Registration Rights Agreements;
provided that the Company shall not be obligated to comply with more than three
such requests in any 12-month period.
(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 not interfere with any Holders' ability to exercise
their rights hereunder.
5.2 Upon a written request from the Company, each Holder agrees not to
effect any public sale or distribution of Registrable Common Stock during the
30-day period following the pricing of any firm commitment underwritten public
offering of Common Stock by the Company; provided that no Holder shall be
required to comply with more than three such requests in any 12-month period.
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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 the
Participating Holders 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 each Participating
Holder, 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, liabilities and expenses (individually, a
"LOSS" collectively, "LOSSES") arising from or caused by (x) with respect to any
registration statement relating to Registrable Common Stock, any untrue
statement or alleged untrue statement of a material fact or 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 with respect to any
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, any untrue statement or alleged untrue statement of
a material fact or omission or alleged omission to state therein a material fact
necessary in order to make the statements, in light of the circumstances under
which they were made, not misleading and (y) any violation or alleged violation
by the 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
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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 such Participating Holder
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) such Participating
Holder 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, such Participating Holder 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 the Participating Holders or any other
person indemnified hereunder and shall survive the transfer of such securities
by the Participating Holders.
7.2 INDEMNIFICATION BY PARTICIPATING HOLDERS.
Each Participating Holder 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 the Participating Holders,
but only with reference to information furnished in writing by or on behalf of
the Participating Holders 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 failure 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 failure. The Indemnifying Party,
upon the request of the Indemnified Party, 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
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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. In no event will the Indemnifying
Party be responsible for the fees and disbursements or more than one independent
counsel on behalf of all Indemnified Parties. 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, 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 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,
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 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, no Participating
Holder shall be required to contribute any amount in excess of the amount by
which the total price at which the Registrable Common Stock of such
Participating Holder was offered to the public exceeds the amount of any damages
which such Participating Holder 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.
AVAILABLE INFORMATION
For as long as there are any shares of Registrable Common Stock, 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 9.
ASSIGNMENT OF RIGHTS
9.1 ASSIGNMENT OF RIGHTS.
Subject to Section 9.2, the Registrable Common Stock and rights of a
Holder under this Agreement with respect to any Registrable Common Stock owned
by such Holder may be assigned to any person who acquires Registrable Common
Stock from such Holder, 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 be assigned 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 such
Holder and if such assignee is acquiring Registrable Common Stock with a fair
market value as of the time of such assignment equal to at least $50 million.
Any assignment of registration rights pursuant to this Section 9.1 shall be
effective only upon receipt by the Company of (a) written notice from the
assigning Holder (i) stating the name and address of any assignee, (ii)
describing the manner in which the assignee acquired Registrable Common Stock
from such Holder and (iii) identifying the Registrable Common Stock with respect
to which the rights under this Agreement are being assigned and (b) the written
agreement of such assignee to be bound by the obligations of such Holder under
this Agreement.
9.2 SCOPE OF ASSIGNMENT.
The rights of an assignee under Section 9.1 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.
After any such assignment, the assigning Holder shall retain its rights under
this Agreement with respect to all other Registrable Common Stock owned by the
assigning Holder.
SECTION 10.
MISCELLANEOUS
10.1 PROVISION OF INFORMATION.
Any Holder 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.
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10.2 INJUNCTIONS.
The parties hereto agree that 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.
10.3 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 commercially reasonable 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.
10.4 FURTHER ASSURANCES.
Subject to the specific terms of this Agreement, the Holders 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.
10.5 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
the Company and Holders holding a majority of the Registrable Common Stock. 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.
10.6 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.
10.7 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
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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.
10.8 GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO ANY CHOICE OF
LAW PRINCIPLES WHICH MIGHT REQUIRE OR PERMIT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION.
10.9 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.
10.10 PARTIES IN INTEREST.
Except as otherwise specifically provided herein, 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.
10.11 TERMINATION.
This Agreement shall terminate if the Exchange Agreement terminates
without any Common Stock being issued thereunder.
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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.
DYNEGY INC.
By: /s/ XXXX X. XXXXXXX
-------------------------------
Name: Xxxx X. Xxxxxxx
Title: Executive Vice President
Address: 0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn:
Telecopier:
ENRON CORP.
By: /s/ XXXXXXX X. XXXXX, XX.
-------------------------------
Name: Xxxxxxx X. Xxxxx, Xx.
Title: Executive Vice President-
Finance and Treasurer
Address:
Attn:
Telecopier:
