1
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
January 23, 2001, by and between Newfield Exploration Company, a Delaware
corporation (the "Company"), and certain of the former stockholders (the
"Stockholders") of Lariat Petroleum, Inc., a Delaware corporation ("Lariat").
RECITALS
A. Pursuant to the Amended and Restated Agreement and Plan of
Merger, dated as of January 19, 2001, by and among the Company, Newfield
Exploration Mid-Continent Inc., a Delaware corporation and a direct, wholly
owned subsidiary of the Company ("Merger Sub"), Lariat and some or all of the
stockholders of Lariat (the "Merger Agreement"), Lariat was merged with and into
Merger Sub (the "Merger") and the Company issued shares of its common stock, par
value $0.01 per share (the "Common Stock"), and shares of its Junior Convertible
Preferred Stock, par value $.01 per share (the "Preferred Stock"), to the
Stockholders.
B. In order to induce the Stockholders to agree to the
proposed terms of the Merger Agreement, the Company agreed to grant certain
securities registration rights to the Stockholders as set forth herein.
AGREEMENTS
In consideration of the premises and the mutual covenants
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Definitions and General Interpretive Principles. In
addition to the capitalized terms defined elsewhere in this Agreement, the
following capitalized terms shall have the following meanings when used in this
Agreement:
"Agreement" has the meaning set forth in the Introduction.
"Commission" means the United States Securities and Exchange
Commission and any agency succeeding to its functions.
"Common Stock" has the meaning set forth in the Recitals.
"Company" has the meaning set forth in the Introduction.
"Effectiveness Period" has the meaning set forth in Section
2(b).
"Effectiveness Target Date" has the meaning set forth in
Section 2(b).
"Filing Target Date" has the meaning set forth in Section
2(b).
"Holder Representative" has the meaning set forth in Section
4(a)(iv).
2
"Holders" means the Initial Holders or a successor, assignee
or transferee of the Initial Holders or subsequent Holders as contemplated by
Section 10 hereof, in each case for so long as such Holder owns Registrable
Securities.
"Indemnified Party" has the meaning set forth in Section 6(c).
"Indemnifying Party" has the meaning set forth in Section
6(c).
"Initial Holder" means the Stockholders and shall be deemed to
include any Person who held shares of common stock, par value $0.01 per share
(the "Lariat Stock"), of Lariat prior to the Merger and who duly delivers a
transmittal letter and certificates for such shares of Lariat Stock in exchange
for shares of Common Stock or Preferred Stock in accordance with the terms of
the Merger Agreement.
"Initial Shelf Registration" has the meaning set forth in
Section 2(a).
"Lariat" has the meaning set forth in the Introduction.
"Loss" and "Losses" have the meanings set forth in Section
6(a).
"Merger" has the meaning set forth in the Recitals.
"Merger Agreement" has the meaning set forth in the Recitals.
"Merger Closing Date" has the meaning set forth in Section
2(b).
"Merger Sub" has the meaning set forth in the Recitals.
"NASD" means the National Association of Securities Dealers,
Inc.
"NYSE" means The New York Stock Exchange.
"Participant" has the meaning set forth in Section 6(a).
"Person" means a natural person, a partnership, a corporation,
a limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization or other entity, or a governmental
entity or any department agency or political subdivision thereof
"Preferred Stock" has the meaning set forth in the Recitals.
"Registrable Securities" means (a) the Common Stock issued in
the Merger, (b) the Preferred Stock issued in the Merger (but only for the
period commencing 60 days after the date hereof and terminating when the waiting
period under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended, for the conversion of such Preferred Stock into Common by Warburg shall
have expired or been terminated), (c) the Common Stock issuable upon conversion
of the Preferred Stock, and (d) any other securities issued or issuable with
respect to such securities by way of a stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization or
2
3
otherwise; provided, however, that any of the foregoing securities shall cease
to be "Registrable Securities" to the extent that (i) a registration statement
with respect to their sale has been declared effective under the Securities Act
and they have been disposed of pursuant to such registration statement, (ii)
they have been sold pursuant to Rule 144 (or any similar provision then in
force) under the Securities Act or (iii) they are eligible to be sold pursuant
to Rule 144(k). For purposes of this Agreement, (x) a "class" of Registrable
Securities shall mean all Registrable Securities with the same terms, and (y) a
"percentage" or a "majority" of the Registrable Securities (or, where
applicable, of any other securities) shall be determined on a fully diluted
basis, based on the number of shares of such securities (including the number of
shares of Common Stock issuable upon conversion of the Preferred Stock
(determined notwithstanding any restriction on conversion by a particular
Holder)).
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission promulgated thereunder.
"Securities Exchange Act" means the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Shelf Registration Statement" means a registration statement
of the Company filed with the Commission on Form S-3 (or any successors thereto)
for an offering to be made on a continuous or delayed basis pursuant to Rule 415
under the Securities Act (or any similar rule that may be adopted by the
Commission) covering all of the Registrable Securities.
"Stockholders" has the meaning set forth in the Introduction.
"Subsequent Shelf Registration" has the meaning set forth in
Section 2(c).
"Warburg" has the meaning set forth in Section 2(d).
"Warburg Partner Distribution" has the meaning set forth in
Section 2(d).
Whenever used in this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, any noun or pronoun shall be
deemed to include the plural as well as the singular and to cover all genders.
The name assigned this Agreement and the section captions used herein are for
convenience of reference only and shall not be construed to affect the meaning,
construction or effect hereof. Unless otherwise specified, the terms "hereof,"
"herein," "hereunder" and similar terms refer to this Agreement as a whole, and
reference herein to Sections refer to Sections of this Agreement.
2. Shelf Registration
(a) Shelf Registration. The Company shall file with the
Commission a Shelf Registration Statement in accordance with the terms of this
Agreement (the "Initial Shelf Registration"). The Initial Shelf Registration
shall be on Form S-3. The Company shall not permit any securities other than the
Registrable Securities to be included in the Initial Shelf Registration or any
Subsequent Shelf Registration.
3
4
(b) Time Periods. The Company will cause, by the 30th day
after the closing date of the Merger (the "Merger Closing Date"), the Initial
Shelf Registration to be prepared and filed with the Commission (the "Filing
Target Date") and have such Initial Shelf Registration Statement declared
effective by the Commission no later than 120 days after the Merger Closing Date
(the "Effectiveness Target Date"). The Company will cause the Initial Shelf
Registration to be continuously effective under the Securities Act until all
Registrable Securities covered by the Shelf Registration have been distributed
in the manner set forth and as contemplated in the Initial Shelf Registration
or, if applicable, a Subsequent Shelf Registration or there are no longer any
Registrable Securities outstanding (the "Effectiveness Period").
(c) Subsequent Shelf Registrations. If the Initial Shelf
Registration or any Subsequent Shelf Registration ceases to be effective for any
reason at any time during the Effectiveness Period (other than because of the
sale of all of the securities registered thereunder), the Company shall, in
addition to fulfilling its obligations under Section 2(e) below, within five
business days of such cessation of effectiveness, amend the Initial Shelf
Registration in a manner to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Shelf Registration Statement
pursuant to Rule 415 under the Securities Act covering all of the Registrable
Securities covered by and not sold under the Initial Shelf Registration or an
earlier Subsequent Shelf Registration (each, a "Subsequent Shelf Registration").
If a Subsequent Shelf Registration is filed, the Company will cause the
Subsequent Shelf Registration to be declared effective under the Securities Act
as soon as practicable after such filing and to keep such Subsequent Shelf
Registration continuously effective during the remainder of the Effectiveness
Period.
(d) Transfer Restrictions. Notwithstanding anything to the
contrary contained in this Section 2, prior to the first anniversary of the
Merger Closing Date, each Initial Holder agrees not to transfer or sell on any
one trading day on the NYSE a number of Registrable Securities that is in excess
of the greater of (x) 1,000 or (y) 2.5% of the number of shares of Common Stock
issued to such Initial Holder in the Merger; provided, however, that the
restrictions of this Section 2(d) shall not apply to (i) a distribution by
Warburg, Xxxxxx Ventures, L.P. ("Warburg") to its general and limited partners
(a "Warburg Partner Distribution"), or (ii) the recipients of a Warburg Partner
Distribution or their transferees.
(e) Supplements and Amendments. The Company shall promptly
supplement and amend any Shelf Registration Statement if required by the rules,
regulations or instructions applicable to the registration form used for such
Shelf Registration Statement, if required by the Securities Act, or if
reasonably requested by the Holders of a majority in aggregate principal amount
of the Registrable Securities covered by such Shelf Registration Statement.
3. Blackout Periods. Notwithstanding anything to the contrary
contained herein, the Company may, upon written notice to the Holders whose
Registrable Securities are included in a Shelf Registration Statement, suspend
such Holders' use of any prospectus which is a part of the Shelf Registration
Statement (in which event the Holders shall discontinue sales of Registrable
Securities pursuant to the Shelf Registration Statement) if, in the reasonable
judgment of counsel to the Company, the Company possesses material nonpublic
information; provided that the Company may not suspend any such sales for more
than an aggregate of 45 consecutive days or for an aggregate of 120 days in any
period of 12 consecutive months.
4
5
Upon the termination of the condition described above, the Company shall give
prompt notice to the Holders whose Registrable Securities are included in the
Shelf Registration Statement, and shall promptly terminate any suspension of
sales it has put into effect and shall take such other actions to permit
registered sales of Registrable Securities as contemplated by this Agreement.
4. Registration Procedures.
(a) In connection with the Company's registration obligations
pursuant to this Agreement, the Company shall, subject to the limitations set
forth herein, effect such registration so as to permit the sale of the
applicable Registrable Securities in accordance with the intended method or
methods of distribution thereof (which in the case of Warburg shall include both
a Warburg Partner Distribution, the listing of the partners of Warburg in the
registration statement and the subsequent sale by the partners in Warburg of
such Registrable Securities) and in conformity with any required time periods
set forth herein, and in connection therewith the Company shall:
(i) before filing a registration statement or
prospectus with the Commission, or any amendments or supplements
thereto and in connection therewith, furnish to the Holders holding the
Registrable Securities covered by such registration statement, copies
of all documents prepared to be filed, which documents will be subject
to the review and comment of such Holders and their respective counsel,
and the Company shall make such changes as are reasonably requested by
such Holders or counsel;
(ii) prepare and file with the Commission a
registration statement relating to the registration on any appropriate
form under the Securities Act, which form shall be available for the
sale of the Registrable Securities; provided, however, the Company
shall not file any registration statement or amendment thereto or any
prospectus or any supplement specific thereto (it being understood that
filings pursuant to the Exchange Act by the Company that are
incorporated by reference are not amendments or supplements to such
registration statement for purposes of this Section 4(a)(ii)) to which
the Holders of a majority of the Registrable Securities covered by such
registration statement shall, in a timely manner, reasonably object;
(iii) prepare and file with the Commission such
amendments or supplements to the applicable registration statement or
prospectus used in connection therewith as may be (A) reasonably
requested by any participating Holder (to the extent such request
relates to information relating to such Holder); (B) necessary to keep
such registration effective for the period of time required by this
Agreement; or (C) necessary to comply fully with the applicable
provisions of Rules 424 and 430A under the Securities Act;
(iv) notify Warburg or another representative of the
Holders selected by the Holders of a majority of the Registrable
Securities (the "Holder Representative") with respect to clauses (A)
and (B) and each selling Holder with respect to clauses (C) and (D) as
soon as reasonably practicable after notice thereof is received by the
Company (A) when the applicable registration statement or any amendment
thereto has been filed
5
6
or becomes effective and when the applicable prospectus or any
amendment or supplement thereto has been filed, (B) of any written
comments by the Commission or any request by the Commission for
amendments or supplements to such registration statement or prospectus
or for additional information, (C) of the issuance by the Commission of
any stop order suspending the effectiveness of such registration
statement or any order preventing or suspending the use of any
preliminary or final prospectus or the initiation or threat of any
proceedings for such purposes and (D) of the receipt by the Company of
any notification with respect to the suspension of the qualification of
the Registrable Securities for offering or sale in any jurisdiction or
the initiation or threat of any proceeding for such purpose;
(v) promptly notify each selling Holder when the
Company becomes aware of the happening of any event as a result of
which the applicable registration statement or prospectus (as then in
effect) contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements therein (in the
case of the prospectus and any preliminary prospectus, in light of the
circumstances under which they were made) not misleading or, if for any
other reason it shall be necessary to amend or supplement such
registration statement or prospectus in order to comply with the
Securities Act and, in either case as promptly as reasonably
practicable thereafter, prepare and file with the Commission an
amendment or supplement to such registration statement or prospectus
which shall correct such statement or omission or effect such
compliance;
(vi) make every reasonable effort to prevent or
obtain at the earliest possible moment the withdrawal of any stop order
with respect to the applicable registration statement or other order
suspending the use of any preliminary or final prospectus;
(vii) promptly incorporate in a prospectus supplement
or post-effective amendment to the applicable registration statement
such information as any Holders appropriately and reasonably request
should be included therein relating to the plan of distribution with
respect to such Registrable Securities, information with respect to the
amount of Registrable Securities being distributed, the purchase price
being paid therefor and any other terms of the distribution of the
Registrable Securities to be sold in such offering; and make all
required filings of such prospectus supplement or post-effective
amendment as soon as reasonably practicable after being notified of the
matters to be incorporated in such prospectus supplement or
post-effective amendment;
(viii) furnish to each selling Holder, without
charge, as many conformed copies as such Holder may reasonably request
of the applicable registration statement, including all documents
incorporated by reference therein or exhibits thereto;
(ix) deliver to each selling Holder, without charge,
as many copies of the applicable prospectus (including each preliminary
prospectus) as such Holder may reasonably request (it being understood
that the Company consents to the lawful use of the prospectus by each
of the selling Holders in connection with the offering and sale of the
Registrable Securities covered by the prospectus);
6
7
(x) on or prior to the date on which the applicable
registration statement is declared effective, register or qualify such
Registrable Securities for offer and sale under the securities or "Blue
Sky" laws of each state and other jurisdiction of the United States, as
any such selling Holder or its counsel reasonably requests in writing,
and do any and all other acts or things reasonably necessary or
advisable to keep such registration or qualification in effect so as to
permit the commencement and continuance of sales and dealings in such
jurisdictions for as long as may be necessary to complete the
distribution of the Registrable Securities covered by the registration
statement; provided that the Company shall not be required (A) to
qualify generally to do business in any jurisdiction where it is not
then so qualified, or (B) to take any action which would subject it to
taxation or general service of process in any such jurisdiction where
it is not then so subject;
(xi) (A) cooperate with the selling Holders to
facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold and, if appropriate, not
bearing any restrictive legends, and (B) upon consummation of a Warburg
Partner Distribution, issue or cause the transfer agent to issue to the
recipients of the Warburg Partner Distribution certificates for the
securities received free of any restrictive legend or stop transfer
order;
(xii) except with respect to the Preferred Stock, not
later than the effective date of the applicable registration statement,
provide a CUSIP number for all Registrable Securities and provide the
applicable transfer agent with printed certificates for the Registrable
Securities which certificates shall be in a form eligible for deposit
with The Depository Trust Company;
(xiii) use its reasonable best efforts to comply with
all applicable rules and regulations of the Commission and make
generally available to its securityholders consolidated earnings
statements satisfying the provisions of Section 11(a) of the Securities
Act and Rule 158 thereunder (or any similar rule promulgated under the
Securities Act) no later than 45 days after the end of any 12-month
period (or 90 days after the end of any 12-month period if such period
is a fiscal year), commencing on the first day of the first fiscal
quarter of the Company after the effective date of a registration
statement, which statements shall cover said 12-month periods;
(xiv) provide and cause to be maintained a transfer
agent and registrar for all Registrable Securities covered by the
applicable registration statement from and after a date not later than
the effective date of such registration statement;
(xv) cause all Registrable Securities of a class
covered by the applicable registration statement to be listed on each
securities exchange on which any of the Company's securities of such
class are then listed or quoted and on each inter-dealer quotation
system on which any of the Company's securities of such class are then
quoted;
(xvi) make available upon reasonable notice at
reasonable times and for reasonable periods for inspection by the
Holder Representative, on behalf of the selling Holders, and by any
attorney, accountant or other agent retained by such selling Holders,
7
8
all pertinent 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 all of the Company's officers and the
independent public accountants who have audited its financial
statements to make themselves available, upon reasonable notice and for
reasonable periods during normal business hours to discuss the business
of the Company and to supply all information reasonably requested by
any such Holder Representative, attorney, accountant or agent in
connection with such registration statement as shall be reasonably
necessary to enable them to exercise their due diligence responsibility
(subject to the entry by each party referred to in this clause (xvi)
into customary confidentiality agreements in a form reasonably
acceptable to the Company); and
(xvii) if any fact or event contemplated by clause
(a)(v) above shall exist or have occurred, prepare a supplement or
post-effective amendment to the registration statement or related
prospectus or any document incorporated therein by reference or file
any other required document so that, as thereafter delivered to the
purchasers of Registrable Securities, the prospectus shall not contain
an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading.
(b) The Company may require each selling Holder as to which
any registration is being effected to furnish to the Company such information
regarding the distribution of such Holders' Registrable Securities and such
other information relating to such Holder and its ownership of the applicable
Registrable Securities as the Company may from time to time reasonably request;
provided Warburg and the partners in Warburg shall not be obligated to furnish
any information as to the beneficial owners of the partners in Warburg, except
to the extent the Company is required by the Securities Act or the Securities
Exchange Act to disclose such information in connection with this Agreement.
Each Holder agrees to furnish such information to the Company and to cooperate
with the Company as necessary to enable the Company to comply with the
provisions of this Agreement. The Company shall have the right to exclude any
Holder that does not comply with the preceding sentence from the applicable
registration.
(c) Each Holder agrees by acquisition of its Registrable
Securities that, upon receipt of any notice from the Company of the happening of
any event of the kind described in Section 5(a)(v), such Holder will discontinue
disposition of its Registrable Securities pursuant to such registration
statement until such Holder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 5(a)(xvii) and of any additional or
supplemental filings that are incorporated by reference in the prospectus, or
until such Holder is advised in writing by the Company that the use of the
prospectus may be resumed, and has received copies and, if so directed by the
Company, such Holder will deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in such Holder's possession, of
the prospectus covering such Registrable Securities which are current at the
time of the receipt of such notice.
5. Registration Expenses. The Company shall pay all of the
following expenses in connection with a registration under this Agreement of
Registrable Securities: (i) all
8
9
registration and filing fees, and any other fees and expenses associated with
filings required to be made with the Commission, (ii) all fees and expenses of
compliance with federal securities or state securities or "Blue Sky" laws, (iii)
all of its printing, duplicating, word processing, messenger, telephone,
facsimile and delivery expenses (including expenses of printing certificates for
the Registrable Securities in a form eligible for deposit with The Depository
Trust Company and of printing prospectuses), (iv) all fees and disbursements of
counsel for the Company and of all independent certified public accountants of
the Company, (v) Securities Act liability insurance or similar insurance if the
Company so desires, (vi) all fees and expenses incurred in connection with the
listing of the Registrable Securities on any securities exchange or the
quotation of the Registrable Securities on any inter-dealer quotation system,
and (vii) the fees and expenses of one counsel to the Holders (selected by the
Holders of a majority of the Registrable Securities included in the Registration
Statement) in an amount not to exceed $10,000. In addition, the Company shall
pay its internal expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal or accounting duties),
the expense of any audit and the fees and expenses of any Person, including
special experts, retained by the Company. The Company shall not be required to
pay any other costs or expenses in the course of the transactions contemplated
hereby, including, without limitation, all expenses incurred by the Holders
(except as provided in clauses (i), (ii) and (vii) of the preceding sentence)
and including, without limitation, underwriting discounts and commissions and
transfer taxes attributable to the sale of Registrable Securities and the fees
and expenses of counsel to the underwriters.
6. Indemnification.
(a) Indemnification by the Company. The Company agrees to
indemnify and hold harmless, to the full extent permitted by law, each Holder
selling Registrable Securities and its respective officers, directors and
employees and each Person who controls (within the meaning of the Securities Act
or the Securities Exchange Act) such selling Holder ("Participant") from and
against any and all losses, claims, damages, judgments, liabilities and expenses
(including reasonable costs of investigation and legal expenses) caused by,
arising out of, or based upon (i) any untrue or alleged untrue statement of a
material fact contained in any registration statement under which such
Registrable Securities were registered under the Securities Act (including any
final, preliminary, or summary prospectus contained therein or any amendment
thereof or supplement thereto or any documents incorporated by reference
therein) or (ii) any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
(in the case of a prospectus or preliminary prospectus, in light of the
circumstances under which they were made) not misleading (each, a "Loss" and
collectively "Losses"); provided, however, that the Company shall not be liable
to any Participant in any such case to the extent that any such Loss is caused
by written information furnished to the Company by such Holder expressly for use
in the preparation thereof, or if such untrue statement or alleged untrue
statement or omission or alleged omission is corrected in an amendment or
supplement to such prospectus which has been made available to the Holders and
the relevant Holder fails to deliver such prospectus as so amended or
supplemented prior to or concurrently with the sales of the Registrable
Securities to the Person asserting such Loss. This indemnity shall be in
addition to any liability the Company may otherwise have.
9
10
(b) Indemnification by the Holders. Each selling Holder agrees
(severally and not jointly) to indemnify and hold harmless, to the fullest
extent permitted by law, the Company, its directors, officers and employees and
each Person who controls the Company (within the meaning of the Securities Act
and the Securities Exchange Act) from and against any Loss to the extent, but
only to the extent, that such Loss is caused by any information furnished in
writing by such selling Holder to the Company specifically for inclusion in such
registration statement and was not corrected in a subsequent writing prior to or
concurrently with the sale of the Registrable Securities to the Person asserting
such Loss. The liability of any Holder under this paragraph shall in no event
exceed the amount by which proceeds received by such Holder from sales of
Registrable Securities giving rise to such obligations exceed the amount of any
Loss that such Holder has otherwise been required to pay by reason of such
untrue statement or omission. This indemnity shall be in addition to any
liability such Holder may otherwise have.
(c) Indemnification Proceedings. Any Person entitled to
indemnification hereunder (an "Indemnified Party") shall (i) give prompt written
notice to the Person from whom such indemnification may be sought (the
"Indemnifying Party") of any claim with respect to which it seeks
indemnification; provided, however, that the failure to so notify the
Indemnifying Party shall not relieve it of any obligation or liability which it
may have hereunder or otherwise except to the extent it is materially prejudiced
by such failure, and (ii) permit such Indemnifying Party to assume the defense
of such claim with counsel reasonably satisfactory to the Indemnified Party;
provided, however, that the Indemnified Party shall have the right to select and
employ separate counsel and to participate in the defense of such claim, but the
fees and expenses of such counsel shall be at the expense of the Indemnified
Party unless (A) the Indemnifying Party has agreed in writing to pay such fees
or expenses, (B) the Indemnifying Party shall have failed to assume the defense
of such claim within a reasonable time after having received notice of such
claim from the Indemnified Party and to employ counsel reasonably satisfactory
to the Indemnified Party, or (C) in the reasonable judgment of the Indemnified
Party, based upon advice of its counsel, a conflict of interest may exist
between the Indemnified Party and the Indemnifying Party with respect to such
claims or the Indemnified Party has defenses separate and apart from the
defenses of the Indemnifying Party with respect to such claims (in which case,
if the Indemnified Party notifies the Indemnifying Party in writing that the
Indemnified Party intends to employ separate counsel at the expense of the
Indemnifying Party, the Indemnifying Party shall not have the right to assume
the defense of such claim on behalf of such Person). If such defense is assumed
by the Indemnifying Party, the Indemnifying Party shall not be subject to any
liability for any settlement made without its consent, but such consent may not
be unreasonably withheld; provided, that an Indemnifying Party shall not be
required to consent to any settlement involving the imposition of equitable
remedies or involving the imposition of any material obligations on such
Indemnifying Party other than financial obligations for which such Indemnified
Party will be indemnified hereunder. If the Indemnifying Party assumes the
defense, the Indemnifying Party shall have the right to settle such action
without the consent of the Indemnified Party; provided, that the Indemnifying
Party shall be required to obtain such consent (which consent may be withheld in
the Indemnified Party's sole discretion) if the settlement includes any
admission of wrongdoing on the part of the Indemnified Party or any equitable
remedies or restriction on the Indemnified Party or its officers, directors or
employees or if the Indemnified Party reasonably believes that the Indemnifying
Party may not be able to satisfy its obligations thereunder. No Indemnifying
Party shall consent to entry of any judgment or enter into any settlement which
does not include as an
10
11
unconditional term thereof the giving by the claimant or plaintiff to each
Indemnified Party of an unconditional release from all liability in respect to
such claim or litigation. The Indemnifying Party shall not, in connection with
any proceeding or related proceedings in the same jurisdiction, be liable for
the reasonable fees, disbursements and other charges of more than one separate
firm admitted to practice in such jurisdiction at any one time from all
Indemnified Parties unless (x) the employment of more than one counsel has been
authorized in writing by the Indemnifying Party or (y) a conflict or potential
conflict exists or may exist (based on advice of counsel to an Indemnified
Party) between such Indemnified Parties, in each of which cases the Indemnifying
Party shall be obligated to pay the reasonable fees and expenses of such
additional counsel or counsels. The indemnification provided for under this
Agreement shall remain in full force and effect regardless of any investigation
made by or an behalf of the Indemnified Party or any officer, director or
controlling Person of such Indemnified Party and shall survive the transfer of
securities.
(d) Contribution. If for any reason the indemnification
provided for in the paragraphs (a) and (b) of this Section 6 is unavailable to
an Indemnified Party or insufficient to hold it harmless as contemplated by
paragraphs (a) and (b) of this Section 6, then the Indemnifying Party shall
contribute to the amount paid or payable by the Indemnified Party as a result of
such Loss in such proportion as is appropriate to reflect the relative fault of
the Indemnifying Party on the one hand and the Indemnified Party on the other.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Indemnifying Party or the Indemnified Party and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. Notwithstanding anything in this
Section 6(d) to the contrary, no Indemnifying Party (other than the Company)
shall be required pursuant to this Section 6(d) to contribute any amount in
excess of the amount by which the net proceeds received by such Indemnifying
Party from the sale of Registrable Securities in the offering to which the
Losses of the Indemnified Parties relate exceed the amount of any damages that
such Indemnifying Party has otherwise been required to pay by reason of such
untrue statement or omission. The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 6(d) were determined by
pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in the second preceding
sentence. 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. If
indemnification is available under this Section 6, the Indemnifying Parties
shall indemnify each Indemnified Party to the full extent provided in Sections
6(a) and 6(b) hereof without regard to the relative fault of said Indemnifying
Parties or Indemnified Party.
7. Compliance with Rule 144. The Company shall file the
reports required to be filed by it under the Securities Act and the Securities
Exchange Act, so long as the Company is obligated to file such reports, and it
shall take such further action as any Holder may reasonably request, all to the
extent required from time to time to enable such Holder to sell Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by (a) Rule 144 under the Securities Act, as such
Rule may be amended from time to time or (b) any similar rules or regulations
hereafter adopted by the Commission.
11
12
Upon the written request of any Holder, the Company shall deliver to such Holder
a written statement as to whether it has complied with such requirements.
8. Term. This Agreement shall terminate at the end of the
Effectiveness Period. The provisions of Sections 6, 8-14 and 18 shall survive
any termination.
9. Amendments and Waivers. The Provisions of this Agreement
may be amended or waived at any time only by the written agreement of the
Company and the Holders holding a majority of the Registrable Securities;
provided, however, (i) any amendment or waiver of Section 6, 9 or 18 shall only
be binding on those Holders that have expressly agreed to such amendment or
waiver and (ii) for a period of two years after the Merger Closing Date, any
amendment or waiver of Section 8 shall only be binding on those Holders that
have expressly agreed to such amendment or waiver. Any waiver, permit, consent
or approval of any kind or character on the part of any such Holders of any
provision or condition of this Agreement must be made in writing and shall be
effective only to the extent specifically set forth in writing. Any amendment or
waiver effected in accordance with this Section shall be binding upon each
Holder and the Company, except as provided in the proviso to the first sentence
of this Section. Each Holder acknowledges that by operation of this Section the
Holders holding a majority of the Registrable Securities, acting in conjunction
with the Company, will have the right and power to diminish or eliminate all
rights pursuant to this Agreement, except as provided in the proviso to the
first sentence of this Section.
10. Successors, Assigns and Transferees.
(a) The registration rights of any Holder under this Agreement
with respect to any Registrable Securities may be transferred and assigned,
provided that no such transfer or assignment shall be binding upon or obligate
the Company to any such transferee or assignee unless and until the Company
shall have received notice of such transfer or assignment and a written
agreement of the transferee or assignee to be bound by the provisions of this
Agreement.
(b) In the event that, either immediately prior to or
subsequent to the effectiveness of any registration statement, any Holder shall
distribute Registrable Securities to its partners, such Holder shall so advise
the Company and provide such information as shall be necessary to permit an
amendment to such registration statement to provide information with respect to
such partners, as selling Holders. Promptly following receipt of such
information, the Company shall file an appropriate amendment to such
registration statement reflecting the information so provided.
(c) This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto, and their respective successors and permitted
assigns as well as the parties referenced in Section 18.
11. Final Agreement. This Agreement constitutes the final
agreement of the parties concerning the matters referred to herein, and
supersedes all prior agreements and understandings.
12. Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any
12
13
provision of this Agreement is held to be prohibited by or invalid under
applicable law, such provision will be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of this Agreement.
Furthermore, in lieu of any such invalid or unenforceable term or provision, the
parties hereto intend that there shall be added as a part of this Agreement a
provision as similar in terms to such invalid or unenforceable provision as may
be possible and be valid and enforceable.
13. Notices. All notices, demands or other communications to
be given or delivered under or by reason of the provisions of this Agreement
shall be in writing and shall be deemed to have been given (a) when delivered
personally to the recipient, (b) when sent to the recipient by telecopy (receipt
electronically confirmed by sender's telecopy machine) if during normal business
hours of the recipient, otherwise on the next business day, (c) one business day
after the date when sent to the recipient by reputable express courier service
(charges prepaid), or (d) five business days after the date when mailed to the
recipient by certified or registered mail, return receipt requested and postage
prepaid. Such notices, demands and other communications shall be sent to the
parties at the addresses indicated below, or to such other address as any party
hereto may, from time to time, designate in writing delivered pursuant to the
terms of this Section.
If to Holders, to the addresses set forth on the stock record
books of the Company; provided, however, that any notices to recipients of a
Warburg Partner Distribution shall be delivered to Warburg, which shall forward
such notice to such recipients. Warburg shall indemnify the Company for any
actual damages (but not consequential or punitive damages) incurred as a result
of the failure of Warburg to fulfill its obligations to forward to the
recipients of a Warburg Partner Distribution a notice given by the Company
pursuant to Section 3. Warburg's obligations under this Section shall be limited
to the assets of Warburg, and no party shall have any recourse to any partner or
Affiliate of Warburg.
If to the Company, to:
Newfield Exploration Company
000 X. Xxx Xxxxxxx Xxxxxxx X., Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
14. Governing Law, Service of Process; Consent to
Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED WITHIN THE STATE.
(b) To the fullest extent permitted by applicable law, each
party hereto (i) agrees that any claim, action or proceeding by such party
seeking any relief whatsoever arising out of, or in connection with, this
Agreement or the transactions contemplated hereby may be brought in the United
States District Court for the Southern District of New York and in any
13
14
New York State court located in the Borough of Manhattan, (ii) agrees to submit
to the jurisdiction of such courts located in the State of New York for purposes
of all legal proceedings brought in such courts and arising out of, or in
connection with, this Agreement or the transactions contemplated hereby, and
(iii) irrevocably waives any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum.
15. Counterparts and Facsimile Execution. This Agreement may
be executed in any number of counterparts, each of which when so executed and
delivered shall be deemed an original, and such counterparts together shall
constitute one instrument. This agreement may be executed by the exchange of
signatures by facsimile transmission. Each party shall receive a duplicate
original of the counterpart copy or copies executed by it and the Company.
16. Specific Performance. Without limiting or waiving in any
respect any rights or remedies of the parties under this Agreement now or
hereinafter existing at law or in equity or by statute, each of the parties
hereto shall be entitled to seek specific performance of the obligations to be
performed by the other in accordance with the provisions of this Agreement.
17. No Inconsistent Agreements. The Company shall not, on or
after the date of this Agreement, enter into any agreement with respect to its
securities that is inconsistent with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. The rights granted
to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's securities
under any agreement in effect on the date hereof. In the event of a conflict
between the terms of this Agreement and the Plan, the terms of this Agreement
shall govern.
18. Third Party Beneficiaries. Holders of Registrable
Securities, the Indemnified Parties and the officers, directors, employees and
affiliates of each Indemnified Party are intended third party beneficiaries of
this Agreement, and this Agreement shall inure to the benefit of, and may be
enforced by, such Persons.
[Remainder of page intentionally left blank. Signature pages follow.]
14
15
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first written above.
NEWFIELD EXPLORATION COMPANY
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President and Chief
Financial Officer
INITIAL HOLDERS
WARBURG, XXXXXX VENTURES, L.P.
By: Warburg, Xxxxxx & Co.,
its general partner
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Xxxxx X. Xxxxxx
By: /s/ Xxxxxxx Xxxx Xxxxxx
-------------------------------------
Xxxxxxx Xxxx Xxxxxx
By: /s/ Xxxxxxxxx Xxxxxxxx
-------------------------------------
Xxxxxxxxx Xxxxxxxx
By: /s/ Xxx Xxxxxxxxxx
--------------------------------------
Xxx Xxxxxxxxxx
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
Xxxxxxx X. Xxxxx
15
16
By: /s/ X. Xxxxxxxx
-------------------------------------
DLJSC for the Benefit of J.
Xxxxxxxx Xxxxx
By: /s/ Xxxxxxx X. XxxXxxxx
-------------------------------------
Xxxxxxx X. XxxXxxxx
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
Xxxxxxx X. Xxxxx
16
