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EXHIBIT 3
REGISTRATION RIGHTS AGREEMENT
THIS AGREEMENT is dated March 25, 1994 by and between UTI ENERGY CORP.,
a Delaware corporation (the "Company") and BEAR, XXXXXXX & CO., Inc., a Delaware
corporation ("Holder").
WITNESSETH:
Holder is the record and beneficial owner of ____ shares (the "Shares")
of the Company's common stock, par value $.001 per share (the "Common Stock").
Holder desires to obtain certain rights with respect to the registration of
Shares under the Securities Act of 1933, as amended (the "Act") in order to
facilitate the public sale and distribution of all or a part of such Shares, and
the Company is willing to furnish such rights under and subject to the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereby agree as follows:
1. REGISTRATION RIGHTS.
(a) Registration of Common Stock by the Company. Until such
time as the Holder no longer holds Shares that are entitled to be registered
under this Agreement by virtue of subsection 1(h) hereof, whenever the Company
shall propose to file a registration statement (other than on Form X-0, Xxxx X-0
or any successor forms thereto) under the Act, or a similar document under any
other statute then in effect corresponding to the Act relating to the public
offering of shares of the Common Stock of the Company within the United States
(a "Registration Statement"), the Company shall (i) give written notice at least
thirty (30) days prior to the filing thereof to the Holder specifying the date
on which the Company proposes to file such Registration Statement and advising
the Holder of its right to have all or any portion of the Shares included
therein, (ii) at the written request of the Holder given to the Company within
fifteen (15) days after receipt of any such notice (which request shall specify
the Shares intended to be sold or disposed of), include among the securities
covered by such Registration Statement, the number of such Shares so requested
to be included, and (iii) use its reasonable efforts to cause such Registration
Statement to become effective and to remain effective for the period required to
permit the public offering and sale by the Holder of the Shares covered thereby
(but not for more than 180 days following the effective date thereof). However,
if all or any part of the proposed registration is to be underwritten (whether
on a "best efforts" or a "firm commitment" basis), the managing underwriter
shall have the right to exclude Shares to the extent the inclusion of such
Shares would, in the written opinion of such managing underwriter, adversely
affect the successful distribution of the underwritten portion of the public
offering, provided (a) during the time the Holder owns 25% or more of the issued
and outstanding Common Stock of the Company, such exclusion applies on a
proportional basis not only to the Shares but also to all other securities
proposed to be included including those for which the Company initiated the
registration and those proposed to be included by other shareholders of the
Company who have the right to include securities of the Company in such
registration,
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and (b) during the time the Holder owns less than 25% of the issued and
outstanding Common Stock of the Company such exclusion applies on a proportional
basis not only to the Shares but also to all other securities proposed to be
included other than those for which the Company initiated the registration. Any
exclusion of Shares shall be made pro rata among the Holder, the Company, if
applicable, and other affected shareholders. The Company shall not grant
registration rights to any other person after the date of this Agreement and
while the Holder shall remain entitled to registration rights pursuant to this
Section 1(a). Holder acknowledges that the Company has previously granted
certain registration rights in the Common Stock Purchase Warrant dated December
14, 1993 issued to UGI Corporation or its affiliates, and that such rights
remain outstanding.
(b) Registration of Shares at the Request of a Stockholder.
Until such time as the Holder no longer holds Shares that are entitled to be
registered under this Agreement by virtue of subsection 1(h) hereof, whenever
the Company shall receive a written request of the Holder that the Company file
a Registration Statement under the Act (which request shall state the number of
Shares to be registered), the Company shall promptly (and in any event within 45
days), subject to the provisions contained in the next paragraph of this Section
1(b), (i) give written notice of such request to each other shareholder having
registration rights, if any, of his right to have shares then held by such
shareholder included among the securities covered by such registration and
offering each such other shareholder an opportunity to request in Writing to
have any or all of such shareholder's shares to be so included, (ii) promptly
prepare and file such Registration Statement, and (iii) use its reasonable
efforts to cause the same to become effective as soon as practicable and to
remain effective for the period required to permit the public offering and sale
of the Shares covered thereby (but not for more than 180 days following the
effective date thereof). Whenever the Company shall file a Registration
Statement pursuant to this Section 1(b) in connection with an underwritten
public offering by the Holder, no securities other than Shares of Holder shall
be included among the securities covered by such Registration Statement to the
extent the inclusion of such other securities would, in the written opinion of
the managing underwriter of such offering, adversely affect the successful
distribution of Holder's Shares unless the Holder shall have consented in
writing to the inclusion of such other securities. The managing underwriter, if
any, of any offering pursuant to this Section 1(b) shall be selected by the
Holder and shall be reasonably satisfactory to the Company (Bear, Xxxxxxx & Co.,
Inc. being deemed reasonably satisfactory).
At such time as Holder no longer holds Ten Percent (10%) of the
outstanding shares of Common Stock and thereafter, Holder agrees that upon
receipt by the Company of a written request to file a Registration Statement
pursuant to this Section 1(b), the Company shall have the right, exercisable
within ten (10) days after receipt of such notice by the Company's giving notice
to the Holder to suspend its obligation to file such Registration Statement for
a period which shall commence on the date such notice is given and continue
until the earlier to occur of (x) the expiration of 60 days, or (y) the date the
Company next files with the Securities and Exchange Commission a quarterly
report on Form 10-Q or an annual report on Form 10-K (the "Blockage Period").
The notice from the Company must state that the Company has determined that it
is in its best interests to delay filing such Registration Statement during the
Blockage Period. A
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further request to file a Registration Statement pursuant to this Section 1(b)
can be made for a period of 20 days after the termination of the Blockage
Period, which request the Company may not suspend. If the Company receives any
request pursuant to this Section 1(b) after the end of such 20 day period then
the Company may again exercise its right to suspend its obligation pursuant to
this Section 1(b) during the Blockage Period by giving the notice required by
the next preceding sentence. The foregoing procedures shall be repeated
successively until such time as the Company complies with its obligations under
the first paragraph of this Section 1(b) or it is no longer obligated to comply
therewith. The Holder further agrees that the Company shall be obligated to
comply only three times with the provisions contained in this subsection 1(b).
(c) Ancillary Company Action to be Taken in Connection with
Any Registration. Whenever the Company shall include any Shares among the
securities covered by a Registration Statement pursuant to Section 1(a) or file
a Registration Statement pursuant to Section 1(b), the Company shall (i) comply
with all applicable rules and regulations of the Securities and Exchange
Commission in connection therewith, (ii) thereafter, for such period of time as
shall be required in connection with the transactions contemplated thereby and
permitted by applicable rules, regulations and administrative practice (but not
for more than 180 days following the effective date of such Registration
Statement), file such post-effective amendments and supplements thereto as shall
be necessary so that neither such Registration Statement nor any related
prospectus, prospectus supplement or amendment shall contain any material
misstatement or omission relative to the Company or any of its assets or its
business or affairs and so that such Registration Statement and prospectus,
prospectus supplement or amendment will otherwise comply with all applicable
legal requirements, (iii) furnish to the Holder such number of copies of such
Registration Statement and any related preliminary prospectus, prospectus,
post-effective amendment, supplement or similar document forming a part thereof
as Holder may reasonably request) and (iv) take all action which may be
necessary under the securities or Blue Sky laws of any state (except that the
Company shall not be required to qualify generally to do business as a foreign
corporation in any jurisdiction wherein it is not so qualified, to subject
itself to taxation in any such jurisdiction or to consent to general service of
process in any such jurisdiction), and as may be reasonably requested by the
Holder, to permit the public offering and sale of the Shares held by the Holder
and covered by such Registration Statement.
(d) Conditions Precedent to Registration. Anything in this
Section 1 to the contrary notwithstanding, the Company shall not be obliged to
include among the securities covered by a Registration Statement any Shares
requested to be so included pursuant to Section 1(a) or file a Registration
Statement pursuant to Section 1(b) unless the Holder shall theretofore have
furnished the Company, in writing, all information with respect to the Holder,
the Shares requested to be so included, the transaction or transactions which
the Holder contemplates and each underwriter who will act in connection
therewith, if any, which any law, rule or regulation requires to be disclosed
therein. In addition, the obligations of the Company hereunder are subject to
and conditioned upon the Holder's providing such other information and taking
such action as may reasonably be requested by the Company in connection with
such registration.
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(e) Expenses. All reasonable out-of-pocket expenses,
disbursements and fees incurred by the Company in connection with any action to
be taken under Section 1(b) (including the reasonable fees and expenses of any
counsel and accountants engaged by the Company and any underwriter's commissions
or expenses or transfer taxes) shall be borne by the Holder. If Holder requests
that Shares be included in a Registration Statement pursuant to Section 1(a),
the Holder shall be responsible for any fees paid in respect of such shares to
the Securities and Exchange Commission, the National Association of Securities
Dealers, Inc., any securities exchange on which the Shares are listed and to any
state in which the Shares are registered, together with all underwriting
discounts and commissions applicable to such Shares.
(f) Indemnification.
(i) The Company shall indemnify and hold harmless the
Holder and each person, if any, who controls the Holder within the meaning of
Section 15 of the Act or Section 20 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and each director, officer, employee or agent of
the Holder from and against any loss, claim, damage, expense, cost or liability,
joint or several, and any action in respect thereof, to which the Holder,
controlling person, director, officer, employee or agent may become subject,
insofar as such loss, claim, damage, liability, expense, cost or action arises
out of, or is based upon, any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement or any Prospectus filed by
the Company pursuant to this Agreement (the "Registration Statement" and the
"Prospectus") or in any amendment or supplement thereto, or which arises out of,
or is based upon, the omission to state therein a material fact required to be
stated therein or necessary to make the statements, therein, in light of the
circumstances under which they were made not misleading, and shall promptly
reimburse the Holder and each such controlling person, director, officer,
employee or agent for legal and other expenses reasonably incurred, as such
legal and other expenses are incurred, by the Holder or controlling person,
director, officer, employee or agent in investigating or defending or preparing
to defend against any such loss, claim, damage, liability, expense, cost or
action; provided that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage, liability, expense, cost or action
arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration Statement or
the Prospectus or in any amendment or supplement thereto in reliance upon and in
conformity with written information specifically relating to the Holder
furnished to the Company by or on behalf of the Holder specifically for
inclusion therein; and provided further that this indemnity shall not inure to
the benefit of the Holder, any person controlling the Holder or any director,
officer, employee or agent of the Holder on account of any loss, claim, damage,
liability, expense, cost or action arising from the sale of Shares to any person
by the Holder if the Holder or the Holder's agent failed to send or deliver a
copy of the Prospectus with or prior to the delivery of written confirmation of
the sale of Shares by the Holder to the person asserting such loss, claim,
damage, liability, expense cost or action who purchased Shares that are the
subject thereof from the Holder, and such delivery would have eliminated such
loss, claim, damage, liability, expense, cost or action, unless such failure
resulted from non-compliance by the Company with the first sentence of Section
1(c)
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hereof. The foregoing indemnity agreement is in addition to any liability which
the Company may otherwise have to the Holder or any controlling person,
director, officer, employee or agent of the Holder. The Company shall also
indemnify underwriters, selling brokers, dealer managers and similar securities
industry professionals participating in the distribution (as described in the
Registration Statement), their officers and directors and each person who
controls such person (within the meaning of Section 15 of the Act or Section 20
of the Exchange Act) to the same extent as provided above with respect to the
indemnification of the Holder if required by the Holder.
(ii) The Holder shall indemnify and hold harmless the Company,
any person who controls the Company and each director, officer, employee or
agent of the Company from and against any loss, claim, damage, expense, cost or
liability and any action in respect thereof, to which the Company or any such
controlling person, director, officer, employee or agent may become subject,
insofar as such loss, claim, damage, liability, expense, cost or action arises
out of, or is based upon, any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus or in
any amendment or supplement thereto or which arises out of, or is based upon,
the omission or alleged omission to state therein a material fact necessary in
order to make the statements therein, in light of the circumstance under which
they were made, not misleading, but in each case only to the extent that the
untrue statement or alleged untrue statement or omission or alleged omission was
made in reliance upon and in conformity with written information specifically
relating to the Holder furnished to the Company by or on behalf of the Holder
specifically for inclusion therein, and shall reimburse the Company or any such
controlling person, director, officer, employee or agent for any legal and other
expenses reasonably incurred, as such legal and other expenses are incurred, by
the Company or any such controlling person, director, officer, employee or agent
in investigating or defending or preparing to defend against any such loss,
claim, damage, liability, expense cost or action. The foregoing indemnity
agreement is in addition to any liability which the Holder may otherwise have to
the Company or any of its controlling persons, directors, officers, employees or
agents. The Company shall be entitled to receive indemnities from underwriters,
selling brokers, dealer managers and selling securities industry professional
participating in the distribution, to the same extent as provided above with
respect to information so furnished in writing by such persons specifically for
inclusion in the Registration Statement or the Prospectus or any amendment or
supplement thereto.
(iii) Promptly after receipt by an indemnified party under
this Section 1(f) of notice of any claim or the commencement of any action
(including, without limitation, any governmental investigation or inquiry), the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 1(f) notify the indemnifying party in
writing of the claim or the commencement of the action, provided that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to any indemnified party under this Section 1(f) except to the
extent that it has been prejudiced in any material respect by such failure or
from any liability which it may have to an indemnified party otherwise that
under this Section 1(f). If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled
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to participate therein, and, to the extent that it wishes, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party. After
notice from the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party shall not be
liable to the indemnified party under this Section 1(f) for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided that an
indemnified party shall have the right to employ counsel to represent it and its
respective controlling persons, directors, officers, employees or agents who may
be subject to liability arising out of any claim in respect of which indemnity
may be sought by such indemnified party against such indemnifying party under
this Section 1(f) if the employment of such counsel shall have been authorized
in writing by such indemnifying party in connection with the defense of such
action, or the indemnifying party shall not have promptly employed counsel
reasonably satisfactory to the indemnified party to assume the defense of such
action, or if counsel for any of the indemnified parties shall have reasonably
concluded that there may be defenses available to the indemnified party and its
respective controlling persons, directors, officers, employees or agents which
are in conflict with those available to the indemnifying party, and in that
event the reasonable fees and expenses of one firm of separate counsel for the
indemnified party and all such other indemnified persons (in addition to the
reasonable fees and expenses of local counsel in each jurisdiction) shall be
paid by the indemnifying party.
(iv) If the indemnification provided for in this Section 1(f)
shall for any reason be unavailable to any indemnified party under Section
1(f)(i) or 1(f)(ii) hereof in respect of any loss, claim, damage, expense, cost
or liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage, expense, cost or liability, or action in respect
thereof, in such proportion as is appropriate to reflect the relative fault of
the Company on the one hand and the Holder on the other with respect to the
statements or omissions which resulted in such loss, claim, damage, expense,
cost or liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative fault shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company on the one hand or the Holder on the other, the intent of the parties
and their relative knowledge, access to information and opportunity to correct
or prevent such statement or omission. The amount paid or payable by an
indemnified party as a result of the loss, claim, damage, expense, cost or
liability, or action in respect thereof, referred to above in this Section
1(f)(iv) shall be deemed to include, for purposes of this Section 1(f)(iv), any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. If an indemnifying party assumes the defense
of any action, such indemnifying party may not settle any such action without
the written consent of the indemnified party unless such settlement
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includes a complete release of the indemnified party in respect of all claims
made against such indemnified party.
(v) The agreements contained in this Section 1(f) shall
survive the sale of Shares and shall remain in full force and effect, regardless
of any termination or cancellation of this Agreement or any investigation made
by or on behalf of any indemnified party.
(g) Listing of Shares. At any time as any shares of Common Stock are
listed on a national securities exchange or designated as a national market
system security by the National Association of Securities Dealers, Inc.
("NASD"), or otherwise listed on the NASD automated quotation system, and a
Registration Statement filed pursuant to Section 1(a) or (b) has been declared
effective, the Company will promptly obtain and maintain the approval for
listing of each such exchange or system, as the case may be, of the Shares
included in such Registration Statement.
(h) Excluded Shares. Any Shares shall cease to be entitled to the
benefits of the provisions of this Section 1 when (i) a Registration Statement
covering such Shares has been declared effective and they have been disposed of
pursuant to such effective Registration Statement, (ii) they are distributed to
the public pursuant to Rule 144A under the Act, or (iii) they have been
otherwise transferred by the Holder.
(i) Holdback. The Holder agrees, to the extent required by applicable
law, not to effect any public sale or distribution of Shares, or any securities
convertible into or exchangeable or exercisable for such Shares, during the five
business days prior to, and during the 90 day period following, the effective
date of any Registration Statement including Shares (except as part of such
registration), if and to the extent timely notified in writing by the Company,
in the case of a non-underwritten public offering, or by the managing
underwriter, in the case of an underwritten public offering. The Company agrees
not to effect any public sale or distribution of Common Stock, any securities
similar to the Shares, or convertible into or exchangeable or exercisable for
such securities during the five business days prior to, and during the 90 day
period following, the effective date of any Registration Statement in which the
Holder is participating pursuant to Section 1 (except as part of such
registration and except pursuant to a registration on Form S-4 or Form S-8, or
any successor to such forms) and that any agreement entered into after the date
hereof pursuant to which the Company issues or agrees to issue any privately
placed securities similar to those being registered shall contain a provision
under which holders of such securities agree not to effect any public sale or
distribution of any such securities during the periods described in the prior
sentence, in each case including a sale pursuant to Rule 144 or 144A under the
Act (except as part of any such registration, if permitted).
(j) Other Covenants of the Company. In connection with the sale of any
Shares the Company shall:
(i) use its reasonable best efforts to comply with all
applicable rules and regulations of the Securities and Exchange Commission, and
make available to
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its security holders, as soon as reasonably practicable, an earning statement
covering the period of at least twelve months, but not more than eighteen
months, beginning with the first day of the Company's first fiscal quarter after
the effective date of any Registration Statement, which earnings statements
shall satisfy the provisions of Section 11(a) of the Act;
(ii) provide a transfer agent and registrar for all Shares
covered by each Registration Statement not later than the effective date of such
registration statement;
(iii) enter into such agreements (including an underwriting
agreement in customary form) and take such other actions as the Holder shall
reasonably request in order to expedite or facilitate the disposition of Shares;
(iv) use its reasonable best efforts to obtain an opinion from
the Company's counsel and a "cold comfort" letter from the Company's independent
public accountants in customary form and covering such matters of the type
customarily covered by such opinions and "cold comfort" letters as the Holder
shall reasonably request;
(v) make available for inspection by the Holder, by each
underwriter participating in any disposition to be effected pursuant to such
registration statement and by any attorney, accountant or other agent retained
by the Holder or any such underwriter, all pertinent financial and other
records, pertinent corporate documents and properties of the Company, and cause
all of the Company's officers, directors and employees to supply all information
reasonably requested by the Holder or any such underwriter, attorney, accountant
or agent in connection with such registration statement; provided, however, that
Holder or any underwriter to whom such information is disclosed shall in writing
agree to use information furnished solely in connection with the contemplated
public offering of Shares; and
(vi) permit the Holder to participate in the preparation of
each Registration Statement and include therein material, furnished to the
Company in writing, which in the judgment of the Holder, subject to the consent
of the Company (which shall not be unreasonably withheld), should be included.
2. ASSIGNMENT; BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
3. ENTIRE AGREEMENT; MODIFICATION. This Agreement constitutes the
entire agreement of the parties with respect to its subject matter and
supersedes all prior or contemporaneous understandings, negotiations and
agreement of the parties concerning such subject matter. This Agreement may be
modified only in a writing signed by the parties hereto specifically stating an
intent to modify this Agreement.
4. GOVERNING LAW. This Agreement shall be governed by, and construed
and interpreted in accordance with the substantive laws of the State of New
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York applicable to contracts made and to be performed within that State, without
giving effect to conflicts of law principles.
5. NOTICE. Any notice, request or other communication required or
permitted to be given pursuant to this Agreement shall be in writing and shall
be (a) mailed by U.S. Express Mail or U.S. Certified Mail, in either case Return
Receipt Requested, (b) delivered by recognized overnight courier such as Federal
Express, or (c) hand delivered to the party to whom addressed at the following
addresses:
if to the Company, UTI Energy Corp.
Suite 112, 000 Xxxxx Xxxx Xxxxx
Xxxxx, XX 00000
Attn: Xxxxxx Drum, President;
with a copy to: Montgomery, McCracken, Xxxxxx & Xxxxxx
Three Parkway - 20th Floor
Philadelphia, PA 19102
Attn: Xxxxx X. Xxxxxxxxxx, Xx., Esquire;
if to the Holder, Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx;
with a copy to: Weil, Gotshal & Xxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Block, Esquire;
or at such other address as may be designated by a party in writing. All written
communications shall be deemed effective upon the earlier of the actual receipt
thereof by the addressee or the expiration of two business days from the date
such communication is placed in the hands of the post office, a recognized
overnight courier, or a messenger service.
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IN WITNESS WHEREOF, this Agreement has been executed by the parties the
day and year first above written.
UTI ENERGY CORP.
By: /s/ Xxxxxxx Xxxxxxxxx
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BEAR, XXXXXXX & CO. INC.
By: /s/ Xxxxxxx Xxxxxxx
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