Registration Rights Agreement - Resource America Inc. and Atlas America Inc.
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement") dated as of
____________, 2004 by and between Resource America, Inc., a Delaware corporation
("RAI"), and Atlas America, Inc., a Delaware corporation and an indirect,
wholly-owned subsidiary of RAI (the "Company").
RECITALS
WHEREAS, RAI owns, directly or indirectly, all of the issued and
outstanding common stock, par value $0.01 per share, of the Company (the "RAI
Common Stock");
WHEREAS, RAI presently intends to spin-off in one or more transactions
that collectively have the effect that all or a substantial part of the shares
of RAI Common Stock are distributed to all or some of the stockholders of RAI in
a tax-free transaction (the "Spin-Off");
WHEREAS, prior to the Spin-Off, the Company proposes to issue shares of
its common stock in an initial public offering registered under the Securities
Act of 1933, as amended; and
WHEREAS, the parties desire to enter into this Agreement to set forth
their agreement regarding certain registration rights with respect to RAI Common
Stock on or after the date that RAI gives written notice to the Company that RAI
has determined not to complete the Spin-Off (the "Spin-Off Notice Date").
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, RAI and the Company, for
themselves, their successors, and assigns, meaning and intending to be bound
hereby, agree as follows:
Section 1. Definitions. The following terms, as used in this Agreement, have the
following meanings. Capitalized terms not otherwise defined herein have the
meaning given to them in the Master Separation and Distribution Agreement of
even date herewith between RAI and Atlas (the "Master Separation and
Distribution Agreement").
"Common Stock" means the common stock, par value $.01 per share, of the
Company.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"Governmental Authority" means any government, any political
subdivision, any governmental agency, bureau, department, board or commission,
any court or tribunal or any other governmental instrumentality, whether
federal, state or local, domestic or foreign.
"Holder" means any Person who owns, of record, any Registrable
Securities.
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"Material Activity" has the meaning given to it in Section 5(a).
"Participating Holder" has the meaning given to it in Section 3(a).
"Participating Registrable Securities" has the meaning given to it in
Section 3(a).
"Person" means an individual, corporation, limited liability company,
partnership, association, trust or other entity or organization, including a
Governmental Authority.
"Registrable Securities" means the shares of the RAI Common Stock and
any stock or other securities into which or for which such RAI Common Stock may
hereafter be changed, converted or exchanged and any other shares or securities
issued to Holders of such RAI Common Stock (or such shares or other securities
into which or for which such shares are so changed, converted or exchanged) upon
any reclassification, share combination, share subdivision, share dividend,
share exchange, merger, consolidation or similar transaction or event. As to any
particular Registrable Securities, such Registrable Securities shall cease to be
Registrable Securities when (i) a registration statement with respect to the
sale by the Holder thereof shall have been declared effective under the
Securities Act and such securities shall have been disposed of in accordance
with such registration statement, (ii) they shall have been distributed to the
public in accordance with Rule 144, (iii) they shall have been otherwise
transferred, new certificates for them not bearing a legend restricting further
transfer shall have been delivered by the Company and subsequent disposition of
them shall not require registration or qualification of them under the
Securities Act or any state securities or blue sky law then in effect or (iv)
they shall have ceased to be outstanding.
"Registration Expenses" means all expenses incident to the Company's
performance of or compliance with this Agreement, including, (a) all
registration, filing and NASD fees, (b) all fees and expenses of complying with
securities or blue sky laws, (c) all word processing, duplicating and printing
expenses, (d) messenger and delivery expenses, (e) the fees and disbursements of
counsel for the Company and of its independent public accountants, including the
expenses of any "comfort" letters required by or incident to such performance
and compliance, (f) premiums and other costs of policies of insurance against
liabilities arising out of the public offering of the Registrable Securities
being registered (if the Company elects to obtain any such insurance), (g) any
fees and disbursements of underwriters customarily paid by issuers or sellers of
securities, including counsel for the underwriters but excluding underwriting
discounts and commissions, and (h) reasonable costs and expenses incurred for
presentations to or meetings with prospective investors in connection with the
offer or sale of Registrable Securities in a public offering thereof.
Notwithstanding anything in the foregoing to the contrary, Registration Expenses
do not include (x) the fees and disbursements of counsel to one or more Selling
Stockholders, or (y) transfer taxes, and underwriting discounts or commissions
and brokerage fees for the sale of any Registrable Securities.
"Requested Securities" has the meaning given in Section 2(a).
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"Requesting Holders" has the meaning given to it in Section 2(a).
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Selling Stockholder" means any Requesting Holder or Participating
Holder.
Section 2. Required Registrations.
(a) Request. Upon the terms and subject to the conditions of this
Agreement, upon the written request on or after the Spin-Off Notice Date of any
Holder of the Registrable Securities (each, a "Requesting Holder") requesting
that the Company effect registration under the Securities Act of all or a
specified number of such Registrable Securities (such specified number of such
Registrable Securities, the "Requested Securities") (which request shall also
specify the intended method or methods of disposition thereof), the Company
shall use its best efforts to effect the registration under the Securities Act
of the Requested Securities requested by the Requesting Holders for disposition
according to the intended method or methods of disposition specified by the
Requesting Holders (including a shelf registration) to the extent required or
deemed appropriate by the Requesting Holders to permit the disposition
(according to the intended method or methods thereof specified by the Requesting
Holders) of the Requested Securities. Notwithstanding anything in this Section 2
to the contrary, the Company shall not be required to effect more than 5
registrations of such Registrable Securities pursuant to this Section 2.
If the Requesting Holders request registration of their Requested
Securities on a delayed or continuing basis under Rule 415 under the Securities
Act (or any successor or similar rule), the Company shall keep such registration
continuously effective for at least 24 months (or such shorter period specified
by the Requesting Holders) following the date on which such registration
statement is declared effective or until all such Registrable Securities
registered thereunder are sold, whichever is shorter.
(b) Withdrawal. The Requesting Holders shall have the right to request
withdrawal of any registration statement filed pursuant to this Section 2 (and
the Company shall so withdraw such registration statement with respect to the
Registrable Securities) prior to the effectiveness of such registration
statement.
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(c) Effective Registration Statement. A registration requested pursuant
to this Section 2 shall not be deemed to be effected (i) if a registration
statement with respect thereto does not become effective under the Securities
Act (other than as a result of a withdrawal of such registration statement by
the Requesting Holders prior to the effectiveness thereof pursuant to Section
2(b)), (ii) if, after it has become effective, such registration is interfered
with for any reason by any stop order, injunction or other order or requirement
of the SEC or any other Governmental Authority, and the result of such
interference prevents the Requesting Holders from disposing of any of the
Requested Securities according to the intended methods of disposition or the
Company exercises its rights under Section 5 and delays the proposed
distribution of any Requested Securities and the Requesting Holders determine
not to sell Requested Securities pursuant to such registration as a result of
such delay, (iii) if the conditions to closing specified in the purchase
agreement or underwriting agreement entered into in connection with any
underwritten offering are not satisfied or waived with the consent of the
Requesting Holders holding more than one-half of the Requested Securities that
were to have been sold thereunder, other than as a result of any breach by any
Requesting Holder or any underwriter of its obligations thereunder or hereunder,
or (iv) if, because of inclusion in such registration of securities held by the
Company (including pursuant to Section 2(g)), more than 5% of the Requested
Securities for such registration are not registered.
(d) Registration Statement Form. Registration statements filed under
this Section 2 shall be on such form of the SEC as shall be selected by the
Company and approved by the Requesting Holders (which approval shall not be
unreasonably withheld), and as shall permit the disposition of the Requested
Securities according to the intended method or methods of disposition specified
by the Requesting Holders. The Company agrees to include in any such
registration statement additional information or material reasonably requested
by the Requesting Holders.
(e) Expenses. The Company shall pay all Registration Expenses in
connection with any registration requested pursuant to this Section 2.
(f) Selection of Underwriters. If a registration pursuant to this
Section 2 involves an underwritten offering, the managing or lead underwriter or
underwriters shall be selected by the Requesting Holders, after reasonable
consultation with the Company; except that if the Company proposes to register
and sell Common Stock in such offering, the managing or lead underwriter or
underwriters shall be selected jointly by the Company and the Requesting
Holders.
(g) Priority in Requested Registrations. If a registration pursuant to
this Section 2 involves an underwritten offering, and the managing or lead
underwriter or underwriters advise the Requesting Holders in writing (a copy of
which shall be provided by the Requesting Holders to the Company) that, in its
or their opinion, the number of securities requested to be included in such
registration by the Requesting Holders, the Company and any other Person exceeds
the number that can be sold in such offering within a price range reasonably
acceptable to the Requesting Holders, the Company shall include in such
registration the number of securities that the Requesting Holders are so advised
can be sold in such offering pursuant to the following provisions:
(i) first, the Registrable Securities proposed to be included
by the Requesting Holders and the securities requested to be included in such
registration by the Company, each pro rata in accordance with the number of
Registrable Securities proposed to be included by the Requesting Holders and the
number of securities so proposed to be included by the Company, respectively;
and
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(ii) second, the securities of any other Person or Persons
proposed to be included in such registration.
(h) Inconsistent Rights. The Company shall not grant to any Person any
registration or other rights inconsistent with the provisions of this Section 2.
Section 3. "Piggy-Back" Registration Rights.
(a) Right to Participate. If, on or after the Spin-Off Notice Date, the
Company at any time proposes to register any of its securities under the
Securities Act (other than by a registration on Form S-4 or S-8 or any successor
or similar forms or filed in connection with an exchange offer or any offering
of securities solely to the Company's existing stockholders) the Company shall
give prompt written notice to each Holder of Registrable Securities of its
intention to do so and of the rights of the Holders under this Section 3. Upon
the terms and subject to the conditions of this Agreement, upon the written
request of any Holder (each, a "Participating Holder") made within 30 days after
the delivery of any such notice by the Company (which request shall specify the
Registrable Securities intended to be disposed of by any Participating Holder
and the intended method or methods of such disposition), the Company shall use
its best efforts to effect the registration under the Securities Act of all
Registrable Securities which the Company has been so requested to register by
such Participating Holders (the "Participating Registrable Securities"), to the
extent required or reasonably deemed appropriate by such Participating Holders
to permit the disposition (in accordance with the intended methods thereof
specified by the Participating Holders), of the Participating Registrable
Securities so to be registered.
If, at any time after giving written notice of its intention to
register any such securities and prior to the effective date of the registration
statement filed in connection with such registration, the Company determines for
any reason not to register or to delay registration of such securities, the
Company may, at its election, give written notice of such determination to each
Participating Holder and, thereupon, (i) in the case of a determination not to
register, the Company need not register any Participating Registrable Securities
in connection with such registration (but shall, in such case, pay the
reasonable fees and expenses of counsel (but of no more than one counsel in an
amount not to exceed $20,000) to the Participating Holders in addition to the
Registration Expenses), without prejudice, however, to the rights of the
Participating Holders to request that such registration be effected as a
registration under Section 2, and (ii) in the case of a determination to delay
registering, the Company may delay registering any Participating Registrable
Securities for the same period as the delay in registering such other
securities. No registration effected under this Section 3 shall relieve the
Company of its obligation to effect any registration upon request under
Section 2.
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(b) Effective Registration Statement. A "piggy-back" registration
requested pursuant to this Section 3 shall not be deemed to be effected (i) if a
registration statement with respect thereto does not become effective under the
Securities Act, (ii) if, after it has become effective, such registration is
interfered with for any reason by any stop order, injunction or other order or
requirement of the SEC or any other Governmental Authority, and the result of
such interference prevents the Participating Holders from disposing of any of
the Participating Registrable Securities according to the intended methods of
disposition or the Company exercises its rights under Section 5 and delays the
proposed distribution of any Participating Registrable Securities and the
Participating Holders determine not to sell Requested Securities pursuant to
such registration as a result of such delay, (iii) if the conditions to closing
specified in the purchase agreement or underwriting agreement entered into in
connection with any underwritten offering are not satisfied or waived with the
consent of the Participating Holders holding more than one-half of the
Participating Registrable Securities that were to have been sold thereunder,
other than as a result of any breach by any Participating Holder or any
underwriter of its obligations thereunder or hereunder, or (iv) if, because of
inclusion in such registration of securities held by the Company (including
pursuant to Section 3(c)), more than 5% of the Participating Registrable
Securities for such registration are not registered.
(c) Priority in Piggy-Back Registration Rights. If a registration
pursuant to this Section 3 involves an underwritten offering and the managing or
lead underwriter or underwriters advises the Company in writing (a copy of which
shall be provided by the Company to each Participating Holder) that, in its or
their opinion, the number of securities requested and otherwise proposed to be
included in such registration exceeds the number that can be sold in such
offering within a price range reasonably acceptable to the Company, the Company
shall include in such registration the number of securities that the Company is
so advised can be sold in such offering determined as follows:
(i) If the registration is a primary registration on behalf of
the Company, (x) first, the securities proposed to be included by the Company,
(y) second, the Participating Registrable Securities requested to be included in
such registration by the Participating Holders on a pro rata basis based on the
number of Participating Registrable Securities requested to be included in such
registration by each Participating Holder, and (z) third, the securities of
other Persons requested to be included in such registration, and
(ii) If the registration is a secondary registration on behalf
of a Person or Persons other than a Holder, (x) first, the securities proposed
to be registered by such other Person or Persons, and (y) second, the
Participating Registrable Securities requested to be included in such
registration by the Participating Holders, on a pro rata basis based on the
number of Participating Registrable Securities requested to be included in such
registration by each Participating Holder.
(d) Inconsistent Rights. The Company shall not grant to any holder of
its securities any registration rights inconsistent with the provisions of this
Section 3.
(e) Expenses. The Company shall pay all Registration Expenses in
connection with any registration requested pursuant to this Section 3.
Section 4. Registration Procedures. If and whenever the Company is required to
use its best efforts to effect the registration of any Registrable Securities as
provided in Sections 2 and 3, the Company shall as expeditiously as possible:
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(a) prepare and as soon thereafter as possible file with the SEC the
requisite registration statement to effect such registration and thereafter use
its best efforts to cause such registration statement to become effective;
provided that before filing such registration statement or any amendments or
supplements thereto, the Company (i) shall furnish to the Selling Stockholders
and their counsel copies of all such documents proposed to be filed, which
documents will be subject to the review of such counsel, and (ii) may not file
any such registration statement or amendment or supplement to which any such
Selling Stockholder shall have reasonably objected on the grounds that, in the
opinion of counsel to such Selling Stockholder, such registration statement or
amendment or supplement does not comply in all material respects with the
requirements of the Securities Act;
(b) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement continuously effective for
a period of either (i) not less than 120 days (subject to extension pursuant to
the last paragraph of this Section 4 or, if applicable, such longer period
contemplated by the last sentence of Section 2(a)) or, if such registration
statement relates to an underwritten offering, such longer period as in the
opinion of counsel for the underwriters a prospectus is required by law to be
delivered in connection with sales of securities by an underwriter or dealer; or
(ii) such shorter period as is required for the disposition of all of the
securities covered by such registration statement in accordance with the
intended methods of disposition by the seller or sellers thereof set forth in
such registration statement (but in any event not before the expiration of any
longer period of effectiveness required under the Securities Act), and to comply
with the provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement until such time as all of such
securities have been disposed of in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such registration
statement;
(c) furnish to each seller of securities covered by such registration
statement such number of conformed copies of such registration statement and of
each such amendment and supplement thereto (in each case including all
exhibits), such number of copies of the prospectus contained in such
registration statement (including each preliminary prospectus and any summary
prospectus) and any other prospectus filed under Rule 424 under the Securities
Act, in conformity with the requirements of the Securities Act, and such other
documents in order to facilitate the disposition of such securities owned by
such seller in accordance with such seller's intended method of disposition, as
such seller may reasonably request, but only during such time as the Company
shall be required under the provisions hereof to cause such registration
statement to remain current;
(d) use its best efforts to register or qualify securities covered by
such registration statement under such other securities or blue sky laws of such
jurisdictions in the United States as each seller thereof shall reasonably
request, to keep such registration or qualification in effect for so long as
such registration statement remains in effect, and to take any other action
which may be reasonably necessary to enable such seller to consummate the
disposition in such jurisdictions in the United States of the securities owned
by such seller, except that for the performance of its obligations under this
Section 4(d), the Company shall not for any such purpose be required to (i)
qualify generally to do business as a foreign corporation in any jurisdiction
where it would not otherwise be required to qualify but for the requirements of
this Section 4(d), (ii) consent to general service of process in any such
jurisdiction, (iii) subject itself to taxation in any such jurisdiction or (iv)
conform its capitalization or the composition of its assets at the time to the
securities or blue sky laws of such jurisdiction;
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(e) use its best efforts to cause all securities covered by such
registration statement to be registered with or approved by such other
Governmental Authorities as may be necessary by virtue of the business and
operations of the Company to enable the sellers to consummate the disposition
thereof;
(f) furnish to each Selling Stockholder a signed counterpart, addressed
to such Selling Stockholder (and the underwriters, if any), of:
(i) an opinion of counsel for the Company, dated the effective
date of such registration statement (and, if such registration includes an
underwritten public offering, dated the date of the closing under the
underwriting agreement), in form and substance reasonably satisfactory to such
Selling Stockholder; and
(ii) a "comfort" letter, dated the effective date of such
registration statement (and, if such registration includes an underwritten
public offering, dated the date of the closing under the underwriting
agreement), in form and substance reasonably satisfactory to such Selling
Stockholder, signed by the independent public accountants who have certified the
Company's financial statements included in such registration statement, covering
substantially the same matters with respect to such registration statement (and
the prospectus included therein) and, in the case of the accountants' letter,
with respect to events subsequent to the date of such financial statements, as
are customarily covered in opinions of issuer's counsel and in accountants'
letters delivered to the underwriters in underwritten public offerings of
securities;
(g) furnish to each such Selling Stockholder a copy of any amendment or
supplement to such registration statement or prospectus (other than any
amendment or supplement in the form of a filing which the Company is required to
make pursuant to the Exchange Act);
(h) notify each Selling Stockholder, at any time when a prospectus
relating thereto is required to be delivered under the Securities Act, upon
discovery that, or upon the discovery of the happening of any event as a result
of which, the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances under which they were
made, and at the request of any such Selling Stockholder promptly prepare and
furnish to such Selling Stockholder a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such prospectus shall
not include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in the light of the circumstances under which they were made;
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(i) otherwise use its best efforts to comply with all applicable rules
and regulations of the SEC, and make available to its security holders, as soon
as reasonably practicable, an earnings statement covering a period of at least
twelve months beginning after the effective date of such registration statement,
which earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act;
(j) cooperate in the conduct of such due diligence relating to the
Company as the Selling Stockholders and the managing or lead underwriter or
underwriters (including their counsel and other authorized representatives) may
reasonably request and is customary for such offering, including by making
available for inspection the Company's financial and other records and pertinent
corporate and other documents as shall be reasonably necessary or appropriate to
enable such persons to conduct their due diligence and by causing the Company's
officers and personnel to supply information and respond to all inquiries
reasonably requested by such persons in connection with their due diligence;
(k) use its best efforts to provide customary assistance to the
underwriters in their selling efforts and presentations to prospective
investors, including by making available the Company's officers and personnel
for presentations to and meetings with prospective investors; and
(l) use its best efforts to list, or have approved for trading, all
shares of Common Stock covered by such registration statement on any national
securities exchange or automated interdealer quotations system on which the
Common Stock is then listed or approved for trading not later than the effective
date of such registration statement.
Each Selling Stockholder shall furnish the Company in writing for
inclusion in the registration statement such information regarding such Selling
Stockholder and the distribution of such Registrable Securities being sold as
the Company may from time to time reasonably request.
Each Selling Stockholder agrees that upon receipt of any notice from
the Company of the happening of any event of the kind described in Section 4(h),
such Selling Stockholder shall forthwith discontinue such Selling Stockholder's
disposition of Registrable Securities pursuant to the registration statement
relating to such Registrable Securities until such Selling Stockholder's receipt
of the copies of the supplemented or amended prospectus contemplated by Section
4(h) and, if so directed by the Company, such Selling Stockholder shall use its
reasonable efforts to deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in such Selling Stockholder's
possession, of the prospectus relating to such Registrable Securities current at
the time of receipt of such notice. If the Company shall give any such notice,
the applicable time period mentioned in Section 4(b) during which a registration
statement is to remain effective shall be extended by the number of days during
the period from and including the date of the giving of such notice pursuant to
Section 4(h), to and including the date when each Selling Stockholder shall have
received the copies of the supplemented or amended prospectus contemplated by
Section 4(h).
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Section 5. Delay of Filing or Sales.
(a) The Company shall have the right, upon giving notice to the Selling
Stockholders of the exercise of such right, to delay filing a registration
statement or to require such Selling Stockholders not to sell any Registrable
Securities pursuant to a registration statement for a period of 90 days from the
date on which such notice is given, or such shorter period of time as may be
specified in such notice or in a subsequent notice delivered by the Company to
such effect prior to or during the effectiveness of the registration statement,
if (i) the Company is engaged in negotiations with respect to, or has taken a
substantial step to commence, or there otherwise is pending, any merger,
acquisition, other form of business combination, divestiture, tender offer,
financing or other similar transaction, or there is an event or state of facts
relating to the Company, in each case which is material to the Company (any of
the foregoing, a "Material Activity"), (ii) such Material Activity would, in the
opinion of counsel for the Company, require disclosure so as to permit the
Registrable Securities to be sold in compliance with law, and (iii) such
disclosure would, in the reasonable judgment of the Company, be adverse to its
interests. Notwithstanding anything in the foregoing to the contrary, the
Company will not have the right to delay the filing of a registration statement
or the selling of Registrable Securities if at any time during the 365 days
preceding the date on which such notice was given the Company had delayed either
the filing of a registration statement that included Registrable Securities or
the selling of Registrable Securities.
(b) The Company shall pay all Registration Expenses and all reasonable
fees and expenses of counsel (but no more than one counsel in an amount not to
exceed $20,000) for the Selling Stockholders with respect to any registration of
Registrable Securities or sales thereof that has been delayed for more than 30
days pursuant to this Section 5.
Section 6. Underwritten Offerings.
(a) Required Underwritten Offerings. If requested by the underwriters
of any underwritten offering of Registrable Securities pursuant to a
registration requested under Section 2, the Company shall enter into an
underwriting agreement with such underwriters for such offering. Such agreement
shall be reasonably satisfactory in substance and form to each Selling
Stockholder, the Company and the underwriters and shall contain representations,
warranties, indemnities and agreements as are customarily provided or entered
into by an issuer in underwriting agreements of this type, including indemnities
for the benefit of the underwriters to the effect and to the extent provided to
the Selling Stockholders in Section 7. The Selling Stockholders shall be parties
to such underwriting agreement and may, at their option, require that any or all
of the conditions precedent to the obligations of such underwriters under such
underwriting agreement be conditions precedent to the obligations of such
Selling Stockholders.
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(b) Piggy-Back Underwritten Offerings. If the Company at any time
proposes to register any of its securities under the Securities Act as
contemplated by Section 3 and such securities are to be distributed by or
through one or more underwriters, the Company shall, if requested by the Selling
Stockholders pursuant to Section 3 and subject to the provisions of Section
3(b), use its best efforts to arrange for such underwriters to include those
Registrable Securities designated by the Selling Stockholders among the
securities to be distributed by such underwriters. The Selling Stockholders
shall be parties to the underwriting agreement between the Company and such
underwriters and may, at their option, require that any or all of the
representations and warranties by, and the other agreements on the part of, the
Company to and for the benefit of such underwriters shall also be made to and
for the benefit of such Selling Stockholders and that any or all of the
conditions precedent to the obligations of such underwriters under such
underwriting agreement be conditions precedent to the obligations of such
Selling Stockholders. No underwriting agreement (or other agreement in
connection with such offering) shall require any Selling Stockholder to make any
representations or warranties to or agreements with the Company or the
underwriters other than representations, warranties or agreements regarding such
Selling Stockholder, such Selling Stockholder's Registrable Securities and such
Selling Stockholder's intended method of distribution and any other
representation required by law.
Section 7. Indemnification.
(a) Indemnification by the Company. In the event of any registration of
any securities of the Company under the Securities Act pursuant to Section 2 or
3, the Company shall, and hereby does, indemnify and hold harmless each Selling
Stockholder, its directors, officers, employees, agents and advisors, and each
other Person, if any, who controls such Selling Stockholder within the meaning
of the Securities Act, against any and all Losses, as incurred, arising out of
relating to:
(i) any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which the
Registrable Securities were registered under the Securities Act, any preliminary
prospectus, final prospectus or summary prospectus contained therein or used in
connection with the offering of securities covered thereby, or any amendment or
supplement thereto;
(ii) any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading; or
(iii) any violation or alleged violation by the Company, or
any of its directors, officers, employees, agents or advisors, of any law or
regulation with respect to such registration or offer or sale of Registrable
Securities, provided that (A) the Company shall not be liable in any such case
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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
such registration statement, any such preliminary prospectus, final prospectus,
summary prospectus, amendment or supplement, in reliance upon and in conformity
with written information prepared and furnished to the Company by any Selling
Stockholder specifically for use in the preparation thereof, and (B) that the
Company shall not be liable to any Selling Stockholder who participates as an
underwriter in any such registration or any other Person who controls such
underwriter within the meaning of the Securities Act, in any such case to the
extent that any such Loss arises out of such Person's failure to send or give a
copy of the final prospectus, as the same may be then supplemented or amended,
to the Person asserting an untrue statement or alleged untrue statement or
omission or alleged omission at or prior to the written confirmation of the sale
of the securities to such Person if such statement or omission was timely
corrected in such final prospectus. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of any such
Person and shall survive the transfer of such securities by such Person. The
Company shall not be obligated to pay the fees and expenses of more than one
counsel or firm of counsel for all parties indemnified in respect of a claim for
each jurisdiction in which such counsel is required unless a conflict of
interest exists between such indemnified party and any other indemnified party
in respect of such claim.
(b) Indemnification by the Selling Stockholders. The Company may
require, as a condition to including any Registrable Securities held by a
Selling Stockholder in any registration statement filed pursuant to Sections 2
or 3, that the Company receive an undertaking reasonably satisfactory to it from
such Selling Stockholder to indemnify and hold harmless (in the same manner and
to the same extent as set forth in Section 7(a)) the Company, each director,
officer, employee, agent and advisor of the Company and each other Person, if
any, who controls the Company within the meaning of the Securities Act (other
than such Persons who are Selling Stockholders) with respect to any untrue
statement or alleged untrue statement in or omission or alleged omission from
such registration statement, any preliminary prospectus, final prospectus or
summary prospectus contained therein, or any amendment or supplement thereto, if
such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
prepared and furnished to the Company by such Selling Stockholder specifically
for use therein. Such indemnity shall remain in full force and effect,
regardless of any investigation made by or on behalf of the Company or any such
director, officer, employee, agent, advisor or controlling Person and shall
survive the transfer of such securities by such Selling Stockholder. The
indemnity provided by each Selling Stockholder under this Section 7(b) shall be
only with respect to its own misstatements and omissions and not with respect to
those of any other seller or prospective seller of securities, and not jointly
and severally, and shall be limited in amount to the net amount of proceeds
received by such Selling Stockholder from the sale of Registrable Securities
pursuant to such registration statement.
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(c) Notices of Claims, etc. The indemnification procedures set forth in
Section 6.07(b) of the Master Separation and Distribution Agreement are
incorporated herein and made a part hereof for all purposes and shall govern the
parties' rights and obligations with resprect thereto.
(d) Contribution. If for any reason the indemnity set forth in the
preceding subsections of this Section 7 is unavailable, or is insufficient to
hold harmless an indemnified party, other than by reason of the exceptions
provided therein, then the indemnifying party shall contribute to the amount
paid or payable by the indemnified party as a result of such losses, claims,
damages or liabilities 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 hand in connection with the offering of securities and the
statements or omissions or alleged statements or omissions which resulted in
such loss, claim, damage, or liability, as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue statement of a material fact or the omission to state a
material fact relates to information supplied by the indemnifying party or by
the indemnified party. No party shall be liable for contribution under this
Section 7(d) except to the extent and under such circumstances as such party
would have been liable to indemnify under this Section 7 if such indemnification
were enforceable under applicable law.
(e) Payments. The indemnification or contribution required by this
Section 7 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or Loss
is incurred, subject to refund if the party receiving such payments is
subsequently found not to have been entitled thereto hereunder. The amount which
any indemnifying party is required to pay to any indemnified party pursuant to
this Agreement shall be reduced (including, but not limited to, retroactively)
by any recovery, judgment, settlement or other amounts actually recovered,
including insurance proceeds, by such indemnified party with respect to such
Losses. If an indemnified party shall have received payment with respect to
Losses and shall subsequently actually receive a recovery, judgment, settlement
or other amount with respect to such Losses, then such indemnified party shall
promptly, but in no event later than 15 business days after such recovery,
judgment, settlement or other amount actually received, pay to such indemnifying
party a sum equal to the lesser of (i) the amount of such recovery, judgment,
settlement or other amount actually received or (ii) the amount of payments
actually received previously in respect of such Loss. All amounts which any
indemnifying party is required to pay to any indemnified party pursuant to this
Agreement shall be calculated on an after-tax basis, taking into account the net
present value of any tax cost and/or tax benefit to the indemnified party in
connection with such indemnification payment and the applicable Loss.
Section 8. Rule 144. The Company shall file the reports required to be filed by
it under the Securities Act and the Exchange Act and the rules and regulations
promulgated thereunder (or, if the Company is not required to file such reports,
shall, upon the request of any holder of Registrable Securities, make publicly
available other information) and 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 pursuant to (i) Rule 144 under the Securities Act, as such rule
may be amended from time to time, or (ii) any similar rule or regulation
hereafter promulgated. Upon the request of any Holder, the Company shall deliver
to such Holder a written statement as to whether it has complied with such
requirements.
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Section 9. Transfer of Registration Rights and Obligations. The rights provided
in this Agreement are for the benefit of all Holders in addition to RAI, and all
such Holders may enforce their rights and remedies directly against the Company.
In the event the Company (or any Person directly or indirectly acquiring, or
succeeding to the rights of, the Company) issues or distributes, or proposes to
issue or distribute, any shares or other securities of another issuer to any
Holder and such shares or other securities would be Registrable Securities, the
Company shall use its reasonable best efforts to cause such issuer to deliver to
the Holders a written instrument, in form and substance reasonably satisfactory
to the Holders, that such issuer is bound by and subject to all the terms and
conditions of this Agreement to the same extent as the Company and that the
rights and remedies provided herein to the Holders apply in all respects to the
Registrable Securities of such issuer.
Section 10. Miscellaneous.
(a) Entire Agreement. This Agreement constitutes the entire agreement
among the parties with respect to the subject matter hereof and supersedes all
prior and contemporaneous agreements and understandings, both oral and written,
between the parties with respect to the subject matter hereof and thereof.
(b) Binding Effect; Benefit. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective heirs,
successors, legal representatives and permitted assigns. Except pursuant to
Section 7 or as set forth in Section 9, nothing in this Agreement, expressed or
implied, is intended to confer on any Person other than the parties hereto and
their respective heirs, successors, legal representatives and permitted assigns,
any rights, remedies, obligations or liabilities under or by reason of this
Agreement.
(c) Assignability. Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company or any Holder; provided that any transferee acquiring
shares of Registrable Securities shall, upon execution by such Person of an
agreement to be bound by this Agreement as a Holder, become a Holder under this
Agreement with all the rights and obligations of a Holder as if an original
party to this Agreement.
(d) Amendment; Waiver. No provision of this Agreement may be waived
except by an instrument in writing executed by the party against whom the waiver
is to be effective. No provision of this Agreement may be amended or otherwise
modified except by an instrument in writing (i) executed by the Company and (ii)
approved by the Holders of a majority of the Registrable Securities then
outstanding voting together as a single class.
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(e) Termination. This Agreement shall survive and be in full force and
effect so long as any Registrable Securities are outstanding.
(f) Notices.All notices, consents, requests, approvals and other
communications provide for in this Agreement, shall be in writing and shall be
deemed validly duly given when sent by confirmed fax, upon personal delivery or
on the third Business Day after being sent by registered or certified U.S. mail
(postage prepaid, return receipt requested) to the parties at the fax number or
address set forth below or at such other fax number or address as a party may
designate to the other parties:
If to the Company, to:
Atlas America, Inc.
311 Rouser Road
Moon Township, PA 15108
Fax: (412) 262-2820
Attention: General Counsel
If to RAI, to:
Resource America, Inc.
1845 Walnut Street
Philadelphia, PA 19102
Fax: (215) 546-5005
Attention: General Counsel
Any Person who becomes a Holder pursuant to this Agreement shall
provide its address and fax number to the Company.
(g) Headings. The headings contained in this Agreement are for
convenience only and shall not affect the meaning or interpretation of this
Agreement.
(h) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
(i) Applicable Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of Delaware.
(j) Specific Performance. Each party hereto acknowledges that the
remedies at law of the other parties for a breach or threatened breach of this
Agreement would be inadequate and, in recognition of this fact, any party to
this Agreement, without posting any bond, and in addition to all other remedies
which may be available, shall be entitled to obtain equitable relief in the form
of specific performance, a temporary restraining order, a temporary or permanent
injunction or any other equitable remedy which may then be available.
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(k) Severability. If one or more provisions of this Agreement are held
to be unenforceable to any extent under applicable law, such provision shall be
interpreted as if it were written so as to be enforceable to the maximum
possible extent so as to effectuate the parties' intent to the maximum possible
extent, and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its terms
to the maximum extent permitted by law.
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IN WITNESS WHEREOF, the parties hereto have executed this Registration Rights
Agreement the day and year first above written.
ATLAS AMERICA, INC.
By:
Name:
Its:
RESOURCE AMERICA, INC.
By:
Name:
Its:
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