1
EXHIBIT 4.11
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement ("Agreement") is made and entered
into as of March 9, l998, by and between Queen Sand Resources, Inc., a Delaware
corporation (the "Company"), and Riata Energy, Inc., a Texas corporation, Four
Sevens Oil Co., Ltd., a Texas limited partnership, Sidney M. Reilly, Peggy Lynn
Mcleland, Dan H. Mcleland, Robert W. Dica, Jr., Trustees of The Grady Family
Trust, under Trust Agreement dated June 18, 1992, Peggy Lynn Mcleland, Trustee
of The Peggy McLeland Trust, under Trust Agreement dated December 24, 1992,
Sidney M. Reilly, Trustee of The Sidney Reilly Trust, under Trust Agreement
dated December 24, 1992, Nasgas LLC, a Texas limited liability company, Hunter
Enis, Dick Lowe, and Dan Poland (the "Sellers").
This Agreement is made pursuant to the Purchase and Sales Agreement
(the "Purchase Agreement") dated as of March 9, 1998, between the Company;
Queen Sand Resources, Inc., a Nevada corporation; and the Sellers. In order to
induce the Sellers to enter into the Purchase Agreement, the Company has agreed
to provide the registration and other rights set forth in this Agreement. The
execution and delivery of this Agreement is a condition to the Closing (as
defined in the Purchase Agreement) under the Purchase Agreement.
The parties agree as follows:
ARTICLE I
1.01. DEFINITIONS. Capitalized terms used and not otherwise defined
herein which are defined in the Purchase Agreement are used herein as so
defined. The terms set forth below are used herein as so defined:
"Holder" means the record holder of any shares of Registrable
Securities.
"Registrable Securities" means 337,500 shares of the Company's
Common Stock, par value $.0015 per share, issued to Hunter Enis, Dick
Lowe, Dan Poland, The Peggy McLeland Trust, The Sidney M. Reilly
Trust, The Grady Family Trust, and Riata Energy, Inc., pursuant to the
Purchase Agreement, until such time as such securities cease to be
Registrable Securities pursuant to Section 1.02 hereof.
"Selling Holder" means a holder who is selling Registrable
Securities pursuant to a Registration Statement (as defined herein).
"Permitted Transferee" as used in Section 2.05 hereof shall
with respect to each Shareholder mean (i) the beneficiaries under such
Shareholder's will or persons to whom the Registrable Securities are
distributable under the laws of descent and distribution, (ii) a trust
for the sole benefit of the Shareholder's spouse, children or
grandchildren, (iii) any other Shareholder, or (iv) a partnership or
other entity established by one or more shareholders for the sole
benefit of the immediate members of the family of one or more
Shareholders.
2
1.02. REGISTRABLE SECURITIES. Any Registrable Security will cease
to be a Registrable Security when (i) a Registration Statement covering such
Registrable Security has been declared effective by the Securities and Exchange
Commission (the "Commission") and such Registrable Security has been issued,
sold or disposed of pursuant to such effective Registration Statement or (ii)
such Registrable Security is deposed of pursuant to Rule 144 (or any similar
provision then in force) under the Securities Act, (iii) such Registrable
Security is eligible to be disposed of pursuant to paragraph (k) of Rule 144
(or any similar provision then in force) under the Securities Act of the 1933
(the "Securities Act") or (iv) such Registrable Security is held by the Company
or one of its Subsidiaries.
ARTICLE II
2.01. PIGGY-BACK REGISTRATION. The rights granted to Holders under
this Article II shall not be effective until six months from the date of
closing. Beginning on September 9, 1998, if the Company proposes to register
any equity securities under the Securities Act for sale to the public for cash,
whether for its own account or for the account of other security holders or
both (except with respect to Registration Statements on Forms S-4 or S-8 for
purposes permissible under such forms as of the date hereof, or any successor
forms for comparable purposes that may be adopted by the Commission) each such
time it will give written notice to all Holders of its intention to do so no
less than 15 Business Days prior to the anticipated filing date. Upon the
written request of any Holder, received by the Company no later than the 10th
Business Day after receipt by such Holder of the notice sent by the Company, to
register, on the terms and conditions as the securities otherwise being sold
pursuant to such registration, any of its Registrable Securities (which request
shall state the intended method of disposition thereof), the Company will use
its best efforts to cause the Registrable Securities as to which registration
shall have been so requested to be included in the securities to be covered by
the Registration Statement proposed to be filed by the Company, on the same
terms and condition as any similar securities included therein, all to the
extent requisite to permit the sale or other disposition by each Holder (in
accordance with its written request) of such Registrable Securities so
registered; provided, however, that the Company may at any time prior to the
effectiveness of any such Registration Statement, in its sole discretion and
with the consent of any Holder, abandon the proposed offering in which any
Holder had requested to participate. The number of Registrable Securities to
be included in such a registration may be reduced or eliminated if and to the
extent, in the case of an underwritten offering, the managing underwriter shall
render to the Company its opinion that such inclusion would materially
jeopardize the successful marketing of the securities (including the
Registrable Securities) proposed to be sold therein. The rights granted herein
shall be subject in all events to any priority rights (if any) of holders
("Prior Holders") under and pursuant to the following agreements and documents:
(a) That certain Registration Rights Agreement dated as
of May 6, 1997, between the Company and Joint Energy Development
Investments Limited Partnership;
(b) Purchase and Sale Agreement dated June 20, 1997, by
and between Collins & Ware, Inc., as Seller, and Queen Sand Resources,
Inc., as Purchaser;
(c) Registration Rights Agreement dated December 22,
1997, by and between Queen Sand Resources, Inc., and certain
institutional investors;
REGISTRATION RIGHTS AGREEMENT PAGE 2
3
(d) Registration Rights Agreement dated December 29,
1997, by and between Queen Sand Resources, Inc., and Enron Capitol &
Trade Resources, Inc., as Agent;
to include any or all of the Prior Holder's registrable shares (as defined in
said documents) before Holder includes any or all of its Registrable Securities
in any registration relating to an underwritten public offering with respect to
which, in the opinion of the managing underwriter, the inclusion in the
offering of all shares requested to be registered by all persons holding
registration rights would materially jeopardize the successful marketing of the
securities (including the prior holders) to be sold. In the event that the
number of Registrable Securities to be included in a registration is to be
reduced as provided above, priority shall be given to the Prior Holders, to the
extent of the rights of the Prior Holders grants such priority. Further, the
Company may hereafter grant registration rights to third party holders of
registrable securities. In the event holders of registrable securities propose
to sell registrable securities pursuant to the registered offering, and in the
managing underwriter's opinion the inclusion of all shares requested would
materially jeopardize the successful marketing of the securities, then, within
10 Business Days after receipt by each such holder of the opinion of such
managing underwriter, all such selling holders may allocate among themselves
after taking into account the priority rights of any holders the number of
shares of such registrable securities which such opinion states may be
distributed without adversely affecting the distribution of the securities
covered by the Registration Statement. If such holders are unable to agree
among themselves with respect to such allocation, such allocation shall be made
in proportion to the respective number of shares specified in their respective
written requests. Notwithstanding anything to the contrary contained in this
Section 2.01, in the event that there is a firm underwriting commitment offer
of securities of the Company pursuant to a Registration Statement covering
Registrable Securities and a Person does not elect to sell its Registrable
Securities to the underwriters of the Company's securities in connection with
such offering, such Person shall not offer for sale, sell, grant any option for
the sale of, or otherwise dispose of, directly or indirectly, any shares of
Common Stock, or any securities convertible into or exchangeable into or
exercisable for any shares of Common Stock during the period of distribution of
the Company's securities by such underwriters, which shall be specified in
writing by the underwriters, shall not exceed any period during which
management of the Company and others are similarly prohibited from disposing of
shares of Common Stock and shall not exceed 180 days following the
effectiveness under the Securities Act of the Registration Statement relating
thereto.
2.02. REGISTRATION PROCEDURES. If and whenever the Company is
required pursuant to this Agreement to effect the registration of any of the
Registrable Securities under the Securities Act, the Company will, as
expeditiously as possible:
(a) prepare and file as promptly as possible with the
Commission a Registration Statement, on a form available to the
Company, with respect to such securities (which filing shall be made
within 45 days after the receipt by the Company of a Request Notice)
and use its best efforts to cause such Registration Statement to
become and remain effective for the period of distribution
contemplated thereby (determined pursuant to subparagraph (g) below);
(b) prepare and file with the Commission such amendments
and supplements to such Registration Statement and the prospectus used
in connection therewith as may be
REGISTRATION RIGHTS AGREEMENT PAGE 3
4
necessary to keep such Registration Statement effective for the period
specified in subsection (g) below and as may be necessary to comply
with the provisions of the Securities Act with respect to the
disposition of all securities covered by such Registration Statement
in accordance with the sellers' intended method of disposition set
forth in such Registration Statement for such period;
(c) furnish to each Selling Holder and to each
underwriter such number of copies of the Registration Statement and
the prospectus included therein (including each preliminary prospectus
and each document incorporated by reference therein to the extent then
required by the rules and regulations of the Commission) as such
Persons may reasonably request in order to facilitate the public sale
or other disposition of the Registrable Securities covered by such
Registration Statement;
(d) use its best efforts to register or qualify the
Registrable Securities covered by such Registration Statement under
the securities or blue sky laws of such jurisdictions as the Selling
Holders or, in the case of an underwritten public offering, the
managing underwriter, shall reasonably request, provided, however,
that the Company will not be required to subject itself to taxation in
any such jurisdiction or to consent to general service of process in
any such jurisdiction;
(e) immediately notify each Selling Holder and each
underwriter, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the happening of
any event as a result of which the prospectus contained 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 then existing
and as promptly as practicable amend the Registration Statement or
supplement the prospectus or take other appropriate action so that the
prospectus does not include an untrue statement of a material fact or
omit to state a material fact required to be stated herein or
necessary to make the statements therein not misleading in the light
of the circumstances then existing; provided, however, that, in the
case of a shelf registration, the Company may delay taking such action
for a period of 60 days, during which time the Selling Holders shall
not sell any Registrable Securities, if the Board of Directors
determines in its reasonable judgment and in good faith that the
making of any required disclosure in connection therewith would have a
material adverse effect on the Company or substantially interfere with
a significant transaction in which the Company is then engaged;
provided, that, the Company covenants to provide any Selling Holder,
an unblocked selling period of at least 45 days under any such shelf
registration;
(f) in the case of an underwritten public offering,
furnish, (i) on the date that Registrable Securities are delivered to
the underwriters for sale pursuant to such Registration Statement, an
opinion of counsel for the Company dated as of such date and addressed
to the underwriters and to the Selling Holder, stating that such
Registration Statement has become effective under the Securities Act
and that (A) to the best knowledge of such counsel, no stop order
suspending the effectiveness thereof has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the Securities Act,
REGISTRATION RIGHTS AGREEMENT PAGE 4
5
(B) the Registration Statement, the related prospectus, and each
amendment or supplement thereof, comply as to form in all material
respects with the requirements of the Securities Act and the
applicable rules and regulations thereunder of the Commission (except
that such counsel need express no opinion as to the financial
statements or any engineering report contained or incorporated
therein) and (C) to such other effects as may reasonable be requested
by counsel for the underwriters, and (ii) on the effective date of the
Registration Statement and on the date that Registrable Securities are
delivered to the underwriters for sale pursuant to such Registration
Statement, a letter dated such dates from the independent accountants
retained by the Company, addressed to the underwriters and to the
Selling Holders, stating that they are independent public accountants
within the meaning of the Securities Act and that, in the opinion of
such accountants, the financial statements of the Company and the
schedules thereto that are included or incorporated by reference in
the Registration Statement or the prospectus, or any amendment or
supplement thereof, comply as to form in all material respects with
the applicable requirements of the Securities Act and the published
rules and regulations thereunder, and such letter shall additionally
address such other financial matters (including information as to the
period ending no more than five Business Days prior to the date of
such letter) including in the Registration Statement in respect of
which such letter is being given as the underwriters may reasonably
request;
(g) make available for inspection by one representative
of the Selling Holders designated by a majority thereof, any
underwriter participating in any distribution pursuant to such
Registration Statement, and any attorney, accountant or other agent
retained by such representative of the Selling Holders or underwriter
(the "Inspectors"), all financial and other records, pertinent
corporate documents and properties of the Company, and cause the
Company's officers, directors and employees to supply all information
reasonably requested by any such Inspector in connection with such
Registration Statement. For purposes of subsections (a) and (b)
above, the period of distribution of Registrable Securities in a firm
commitment underwritten public offering shall be deemed to extend
until each underwriter has completed the distribution of all
securities purchased by it, and the period of distribution of
Registrable Securities in any other registration shall be deemed to
extend until the earlier of the sale of all Registrable Securities
covered thereby or 180 days;
(h) use its best efforts to keep effective and maintain
for the period specified in subparagraph (g) a registration,
qualification, approval or listing obtained to cover the Registrable
Securities as may be necessary for the Selling Holders to dispose
thereof and shall from time to time amend or supplement any prospectus
used in connection therewith to the extent necessary in order to
comply with applicable law;
(i) use its best efforts to cause the Registrable
Securities to be registered with or approved by such other
governmental agencies or authorities as may be necessary by virtue of
the business and operations of the Company to enable the Selling
Holders to consummate the disposition of such Registrable Securities;
and
(j) enter into customary agreements (including, if
requested, an underwriting agreement in customary form) and take such
other actions as are reasonable requested by the
REGISTRATION RIGHTS AGREEMENT PAGE 5
6
Selling Holders or the underwriters, if any, in order to expedite or
facilitate the disposition of such Registrable Securities.
In connection with each registration hereunder, each Selling Holder
will furnish promptly to the Company in writing such information with respect
to itself and the proposed distribution by it as shall be reasonably necessary
in order to ensure compliance with federal and applicable state securities
laws.
In connection with each registration hereunder with respect to an
underwritten public offering, the Company and each Selling Holder agrees to
enter into a written agreement with the managing underwriter or underwriters
and containing such provisions as are customary in the securities business for
such an arrangement between underwriters and companies of the Company's size
and investment stature, provided that such agreement shall not contain any such
provision applicable to the Company or the Selling Holders that is inconsistent
with the provisions hereof.
If the Registrable Securities are to be sold pursuant to Rule 415
promulgated under the Securities Act, Holder represents and warrants to, and
agrees with, the Company that:
(a) Selling Holder will furnish each broker through whom
Selling Holder offers the Registrable Securities such number of copies
of the Prospectus and any supplements thereto or amendments thereof
which such broker may require; will inform such broker as to the
number of Registrable Securities offered through such broker; that
such Registrable Securities are part of a distribution and that such
broker is subject to the provisions of Regulation M under the
Securities Exchange Act of 1934 until such time as such broker has
completed the sale of all such Registrable Securities; and will notify
such broker when distribution of the Registrable Securities by Selling
Holder pursuant to the Registration Statement has been completed or
the Registration Statement is no longer effective or is withdrawn;
(b) Selling Holder will, promptly after the end of each
week in which any disposition of the Registrable Securities by Selling
Holder has occurred and upon completion of the distribution of the
Registrable Securities pursuant to the Registration Statement, report
to the Company such dispositions made during such week or upon such
completion, as the case may be;
(c) At least five (5) business days prior to any
disposition of the Registrable Securities, Selling Holder shall advise
the Company of the dates on which such disposition is expected to
commence and terminate, the number of Registrable Securities expected
to be sold, the method of disposition and such other information as
the Company may reasonably request in order to supplement the
Prospectus in accordance with the rules and regulations of the SEC.
2.03. EXPENSES.
(a) All expenses incident to the Company's performance
under or compliance with this Agreement, including without limitation,
all registration and filing and independent
REGISTRATION RIGHTS AGREEMENT PAGE 6
7
public accountants for the Company, fees of the National Association
of Securities Dealers, Inc., transfer taxes, fees of transfer agents
and registrars and costs of insurance, but excluding any Selling
Expenses (as defined below), are herein called "Registration
Expenses." All underwriting fees, discounts and selling commissions
allocable to the sale of the Registrable Securities are herein called
"Selling Expenses."
(b) The Company will pay all Registration Expenses in
connection with each Registration Statement filed pursuant to this
Agreement, whether or not the Registration Statement becomes
effective, and the Selling Holders shall pay Selling Expenses and any
incidental expenses incurred by the Selling Holders (including,
without limitation, legal fees of their counsel, if any) in connection
with any Registrable Securities registered pursuant to this Agreement.
2.04. INDEMNIFICATION.
(a) In the event of a registration of any Registrable
Securities under the Securities Act pursuant to this Agreement, the
Company will indemnify and hold harmless each Selling Holder
thereunder and each underwriter of Registrable Securities thereunder
and each Person, if any, who controls such Selling Holder or
underwriter within the meaning of the Securities Act and the
Securities Exchange Act of 1934 (the "Exchange Act"), against any
losses, claims, damages or liabilities (including reasonable
attorneys' fees) ("Losses"), joint or several, to which such Selling
Holder or underwriter or controlling Person may become subject under
the Securities Act, the Exchange Act or otherwise, insofar as such
Losses (or actions in respect thereof), arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in any Registration Statement under which such Registrable
Securities were registered under the Securities Act pursuant to this
Agreement, any preliminary prospectus or final prospectus contained
herein, or any amendment or supplement thereof, or arise out of or are
based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each such
Selling Holder, each such underwriter and each such controlling Person
for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such Loss or actions;
provided, however, that the Company will not be liable in any such
case if and to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission so made in
conformity with information furnished by such Selling Holder, such
underwriter or such controlling Person in writing specifically for use
in such Registration Statement or prospectus.
(b) Each Selling Holder agrees to indemnify and hold
harmless the Company, its directors, officers, employees and agents
and each Person, if any, who controls the Company within the meaning
of the Securities Act or of the Exchange Act to the same extent as the
foregoing indemnity from the Company to such Selling Holder, but only
with respect to information regarding such Selling Holder furnished in
writing by or on behalf of such Selling Holder expressly for inclusion
in any Registration Statement or prospectus relating to the
Registrable Securities, or any amendment or supplement thereto;
provided, however,
REGISTRATION RIGHTS AGREEMENT PAGE 7
8
that the liability of such Selling Holder shall not be greater in
amount than the dollar amount of the proceeds (net of any Selling
Expenses) received by such Selling Holder from the sale of the
Registrable Securities giving rise to such indemnification.
(c) Promptly after receipt by an indemnified party
hereunder of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party hereunder, notify the indemnifying
party in writing thereof, but the omission so to notify the
indemnifying party shall not relieve it from any liability which it
may have to any indemnified party other than under this Section 2.04.
In case any such action shall be brought against any indemnified party
and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate in
and, to the extent it shall wish, to assume and undertake the defense
thereof with counsel reasonably satisfactory to such indemnified party
and, after notice from the indemnifying party to indemnified party of
its election so to assume and undertake the defense thereof, the
indemnifying party shall not be liable to such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation and of liaison with counsel so selected; provided,
however, that (i) if the indemnifying party has failed to assume the
defense and employ counsel or (ii) if the defendants in any such
action include both the indemnified party and the indemnifying party
and counsel to the indemnified party shall have concluded that there
may be reasonable defenses available to the indemnified party that are
different from or additional to those available to the indemnifying
party or if the interests of the indemnified party reasonably may be
deemed to conflict with the interests of the indemnifying party, then
the indemnifying party shall have the right to select a separate
counsel and to assume such legal defense and otherwise to participate
in the defense of such action, with the expenses and fees of such
separate counsel and other expenses related to such participation to
be reimbursed by the indemnifying party as incurred, provided that
such fees and expenses shall be reimbursed for only one counsel for
all indemnified parties.
(d) If the indemnification provided for in this Section
2.04 is unavailable to the Company or the Selling Holders or it is
insufficient to hold them harmless in respect of any losses, claims,
damages, liabilities or expenses referred to herein, then each such
indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities and
expenses as between the Company on the one hand and each Selling
Holder on the other, in such proportion as is appropriate to reflect
the relative fault of the Company on the one hand and of such Selling
Shareholder on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations.
The relative fault of the Company one the one hand and each Selling
Holder on the other shall be determined by reference to, among other
things, whether the untrue or alleged untrue statements of a material
fact or the omission or alleged omission to state a material fact has
been made by, or relates to, information supplied by such party, and
the parties' relative knowledge, access to information and opportunity
to correct or prevent such statement or omission.
REGISTRATION RIGHTS AGREEMENT PAGE 8
9
No person guilty of a fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who is not guilty of such fraudulent misrepresentation.
2.05. TRADING RESTRICTION.
(a) In addition to the restriction on resale imposed by
the requirements of the Securities Act and applicable state securities
or blue sky laws, the Holder also covenants hereby that it shall not
resell any shares of the Registrable Securities unless:
(v) such sales are in blocks of the lesser of at
least 25,000 shares in share amount or at least $100,000 in
sales amount; or
(w) any such sale not meeting the criteria set
forth in the preceding clause (v) may not exceed, together
with all other sales [including any block sales which have
occurred pursuant to the preceding clause (v)] of Registrable
Securities for the account of such Holder within the preceding
ninety days, an amount equal to the average weekly reported
volume of trading in the Common Stock on all national
securities exchanges and/or reported through NASDAQ during the
eight calendar weeks preceding the intended date of sale; or
(x) such sale is pursuant to the sale, transfer,
assignment, or disposition of such securities to a Permitted
Transferee; or
(y) such sale is pursuant to a tender offer or
exchange offer, or a merger or consolidation in which the
Company is acquired, or a plan of liquidation of the Company;
or
(z) such amount as agreed upon by the Company.
(b) Prior to disposing of any shares of Common Stock
pursuant to Rule 144 (or any successor rule) promulgated under the
Securities Act, the Holder agrees to give the Company ten days' prior
notice of any proposed disposition and to act in good faith in
evaluating any proposals made by the Company concerning the number of
shares to be disposed of by the Holder, as well as any alternate
arrangements which the Company may suggest to provide liquidity to the
Holder with respect to such shares of Common Stock.
(c) Notwithstanding the limitations imposed by this
Section 2.05, if the Company, subsequent to the date of this
agreement, issues greater than 200,000 shares of its restricted common
stock (other than pursuant to Regulation S promulgated under the
Securities Act of 1933 as amended) to a third party in a transaction
where less restrictive trading restrictions are imposed on such third
party than those set forth in this Section 2.05, the Company shall
provide notice to the Holder, and the Holder shall thereafter be
entitled to rely upon such lesser restrictions.
REGISTRATION RIGHTS AGREEMENT PAGE 9
10
ARTICLE III
3.01. COMMUNICATIONS. All notices and other communications provided
for or permitted hereunder shall be made in writing by telecopy, courier
service or personal delivery:
(a) if to a Holder of Registrable Securities, at the most
current address given by such Holder of the Company in accordance with
the provisions of this Section 3.01, which address initially is, with
respect to the Purchaser, the address set forth in the Purchase
Agreement; and
(b) if to the Company, initially at its address set forth
in the Purchase Agreement and thereafter at such other address, notice
of which is given in accordance with the provisions of this Section
3.01.
All such notices and communication shall be deemed to have been
received at the time delivered by hand, if personally delivered; when receipt
acknowledged, if telecopied; and on the next Business Day if timely delivered
to an air courier guaranteeing overnight delivery.
3.02. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent holders of Registrable Securities.
3.03. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, taken together, shall constitute but
one and the same Agreement.
3.04. HEADINGS. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
3.05. GOVERNING LAW. The laws of the State of Texas shall govern
this Agreement without regard to principles of conflict of laws.
3.06. SEVERABILITY OF PROVISIONS. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
un-enforceability without invalidating the remaining provisions hereof or
affecting or impairing the validity or enforceability of such provision in any
other jurisdiction.
3.07. ENTIRE AGREEMENT. This Agreement, together with the Purchase
Agreement is intended by the parties as a final expression of their agreement
and intended to be a compromise and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter contained
herein. There are no restrictions, promises, warranties or undertakings, other
than those set forth or referred to herein with respect to the registration
rights granted by the Company with respect to the securities sold pursuant to
the Purchase Agreement. This Agreement and the Purchase Agreement supersede
all prior agreements and understandings between the parties with respect to
such subject matter.
REGISTRATION RIGHTS AGREEMENT PAGE 10
11
3.08. ATTORNEYS' FEES. In any action or proceeding brought to
enforce any provision of this Agreement, the successful party shall be entitled
to recover reasonable attorneys' fees in addition to its costs and expenses and
any other available remedy.
3.09. AMENDMENT. This Agreement may be amended only by means of a
written amendment signed by the Company and by the Holders of a majority of the
Registrable Securities.
3.10. REGISTRABLE SECURITIES HELD BY THE COMPANY OR IT AFFILIATES.
In determining whether the Holders of the required amount of Registrable
Securities have concurred in any direction, amendment, supplement, waiver or
consent, Registrable Securities owned by the Company or one of its Affiliates
shall be disregarded.
3.11. ASSIGNMENT OF RIGHTS.
(a) The rights of any Holder under this Agreement may be
assigned to any Person who acquires the Registrable Securities
issuable on conversion or exercise thereof. Any assignment of
registration rights pursuant to this Section 3.11(a) shall be
effective only upon receipt by the Company of written notice from such
assigning Holder stating the name and address of any assignee.
(b) The rights of an assignee under Section 3.11(a) shall
be the same rights granted to the assigning Holder under this
Agreement. In connection with any such assignment, the term "Holder"
as used herein shall, where appropriate to assign the rights and
obligations of the assigning Holder hereunder to such assignee, be
deemed to refer to the assignee.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
RIATA ENERGY, INC.
By: /s/ MALONE MITCHELL
-------------------------------------------------------------
Malone Mitchell, 3rd, President
FOUR SEVENS OIL CO., LTD.
By: Hunter Production Co., a Texas corporation,
General Partner
By: /s/ HUNTER ENIS
-------------------------------------------------------------
Hunter Enis, President
REGISTRATION RIGHTS AGREEMENT PAGE 11
12
NASGAS LLC
By: /s/ MALONE MITCHELL
-------------------------------------------------------------
Malone Mitchell 3rd, President
THE GRADY FAMILY TRUST,
UNDER AGREEMENT DATED JUNE 18, 1992
By: /s/ PEGGY LYNN McLELAND
-------------------------------------------------------------
Peggy Lynn McLeland, Trustee
By: /s/ SIDNEY M. REILLY
-------------------------------------------------------------
Sidney M. Reilly, Trustee
By: /s/ DAN H. McLELAND
-------------------------------------------------------------
Dan H. McLeland, Trustee
By: /s/ ROBERT W. DICA, JR.
-------------------------------------------------------------
Robert W. Dica, Jr., Trustee
By: /s/ RICHARD WALT
-------------------------------------------------------------
Richard Walt, Trustee
/s/ SIDNEY M. REILLY
----------------------------------------------------------------------
Sidney M. Reilly, Trustee of the Sidney M. Reilly
Trust, Under Agreement dated December 24, 1992
/s/ PEGGY LYNN McLELAND
----------------------------------------------------------------------
Peggy Lynn McLeland, Trustee of the Peggy Lynn
McLeland Trust, Under Agreement dated December 24,
1992
/s/ HUNTER ENIS
----------------------------------------------------------------------
Hunter Enis
REGISTRATION RIGHTS AGREEMENT PAGE 12
13
/s/ DICK LOWE
----------------------------------------------------------------------
Dick Lowe
/s/ DAN POLAND
----------------------------------------------------------------------
Dan Poland
QUEEN SAND RESOURCES, INC.,
a Delaware Corporation
By: /s/ ROBERT P. LINDSAY
-------------------------------------------------------------
Robert P. Lindsay
Vice President
REGISTRATION RIGHTS AGREEMENT PAGE 13