Exhibit 10.2
$150,000,000
PARALLEL PETROLEUM CORPORATION
10 1/4% SENIOR NOTES DUE 2014
REGISTRATION RIGHTS AGREEMENT
July 31, 2007
Jefferies & Company, Inc.
Merrill Lynch, Pierce, Fenner & Smith
     Incorporated
BNP Paribas Securities Corp.
c/o:
  Jefferies & Company, Inc.
 
  520 Madison Avenue
 
  New York, New York 10022

Dear Sirs:
     Parallel Petroleum Corporation, a Delaware corporation (the “Company”),
proposes to issue and sell to Jefferies & Company, Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated and BNP Paribas Securities Corp. (collectively, the
“Initial Purchasers”), upon the terms set forth in a purchase agreement dated
July 26, 2007 (the “Purchase Agreement”), $150,000,000 aggregate principal
amount of its 10 1/4% Senior Notes due 2014 (the “Initial Securities”). The
Initial Securities will be issued pursuant to an Indenture, dated as of July 31,
2007 (the “Indenture”), between the Company and Wells Fargo Bank, National
Association (the “Trustee”). As an inducement to the Initial Purchasers, the
Company agrees with the Initial Purchasers, for the benefit of the holders of
the Initial Securities (including, without limitation, the Initial Purchasers),
the Exchange Securities (as defined below) and the Private Exchange Securities
(as defined below) (collectively, the “Holders”), as follows:
     1. Registered Exchange Offer. Unless the Registered Exchange Offer (defined
below) would not be permitted for any reason referred to in clause (i) of the
first sentence of Section 2 below, the Company shall, at its own cost, use
commercially reasonable efforts to prepare and, not later than 180 days after
(or if the 180th day is not a business day, the first business day thereafter)
the date of original issue of the Initial Securities (the “Issue Date”), file
with the Securities and Exchange Commission (the “Commission”) a registration
statement (the “Exchange Offer Registration Statement”) on an appropriate form
under the Securities Act of 1933, as amended (the “Securities Act”), with
respect to a proposed offer (the “Registered Exchange Offer”) to the Holders of
Transfer Restricted Securities (as defined in Section 6(d) hereof), who are not
prohibited by any law or policy of the Commission from participating in the
Registered Exchange Offer, to issue and deliver to such Holders, in exchange for
the Initial Securities, a like aggregate principal amount of debt securities
(the “Exchange Securities”) of the Company issued under the Indenture and
identical in all material respects to the Initial Securities (except for the
transfer restrictions relating to the Initial Securities and the provisions
relating to the matters described in Section 6(d) hereof) that would be
registered under the Securities Act. The Company shall use its reasonable best
efforts to cause such Exchange Offer

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Registration Statement to be declared effective under the Securities Act within
210 days (or if the 210th day is not a business day, the first business day
thereafter) after the Issue Date and shall keep the Registered Exchange Offer
open for not less than 20 business days (or longer, if required by applicable
law) after the date notice of the Registered Exchange Offer is mailed to the
Holders (such period being called the “Exchange Offer Registration Period”).
     If the Company commences the Registered Exchange Offer, the Company will be
entitled to close the Registered Exchange Offer in as few as 20 business days
after the commencement thereof provided that the Company has accepted all the
Initial Securities theretofore validly tendered, and not withdrawn, in
accordance with the terms of the Registered Exchange Offer.
     Following the declaration of the effectiveness of the Exchange Offer
Registration Statement, the Company shall promptly commence the Registered
Exchange Offer, it being the objective of such Registered Exchange Offer to
enable each Holder of Transfer Restricted Securities electing to exchange the
Initial Securities for Exchange Securities (assuming that such Holder is not an
affiliate of the Company within the meaning of the Securities Act, acquires the
Exchange Securities in the ordinary course of such Holder’s business and has no
arrangements or understanding with any person to participate in the distribution
of the Exchange Securities and is not prohibited by any law or policy of the
Commission from participating in the Registered Exchange Offer) to trade such
Exchange Securities from and after their receipt without any limitations or
restrictions under the Securities Act and without material restrictions under
the securities laws of the several states of the United States; provided,
however, that the Exchanging Dealers (as defined below) will be required to
deliver a prospectus in connection with resales of Exchange Securities.
     The Company acknowledges that, pursuant to current interpretations by the
Commission’s staff of Section 5 of the Securities Act, in the absence of an
applicable exemption therefrom, (i) each Holder that is a broker-dealer electing
to exchange Initial Securities, acquired for its own account as a result of
market making activities or other trading activities, for Exchange Securities
(an “Exchanging Dealer”), is required to deliver a prospectus containing the
information set forth in (a) Annex A hereto on the cover, (b) Annex B hereto in
the “Exchange Offer Procedures” section and the “Purpose of the Exchange Offer”
section, and (c) Annex C hereto in the “Plan of Distribution” section of such
prospectus in connection with a sale of any such Exchange Securities received by
such Exchanging Dealer pursuant to the Registered Exchange Offer and (ii) an
Initial Purchaser that elects to sell Exchange Securities acquired in exchange
for Initial Securities constituting any portion of an unsold allotment is
required to deliver a prospectus containing the information required by Items
507 or 508 of Regulation S-K under the Securities Act, as applicable, in
connection with such sale.
     The Company shall use its reasonable best efforts to keep the Exchange
Offer Registration Statement effective and to amend and supplement the
prospectus contained therein, in order to permit such prospectus to be lawfully
delivered by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such persons must comply with such
requirements in order to resell the Exchange Securities; provided, however, that
such period shall not exceed the lesser of 180 days and the date on which all
persons subject to the prospectus delivery requirements of the Securities Act
have sold all Exchange Securities held by them.

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     If, upon consummation of the Registered Exchange Offer, any Initial
Purchaser holds Initial Securities acquired by it as part of its initial
distribution, the Company (upon written request from the Initial Purchaser),
simultaneously with the delivery of the Exchange Securities pursuant to the
Registered Exchange Offer, shall issue and deliver to such Initial Purchaser, in
exchange (the “Private Exchange”) for the Initial Securities held by such
Initial Purchaser, a like principal amount of debt securities of the Company
issued under the Indenture and identical in all material respects (including the
existence of restrictions on transfer under the Securities Act and the
securities laws of the several states of the United States, but excluding
provisions relating to the matters described in Section 6 hereof) to the Initial
Securities (the “Private Exchange Securities”). The Initial Securities, the
Exchange Securities and the Private Exchange Securities are herein collectively
called the “Securities.”
     In connection with the Registered Exchange Offer, the Company shall:
     (a) deliver to each Holder a copy of the prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate Letter of
Transmittal and related documents;
     (b) keep the Registered Exchange Offer open for not less than 20 business
days (or longer, if required by applicable law) after the date notice thereof is
mailed to the Holders;
     (c) utilize the services of a depositary for the Registered Exchange Offer,
which may be the Trustee or an affiliate of the Trustee;
     (d) permit Holders to withdraw tendered Securities at any time prior to the
close of business, New York time, on the last business day on which the
Registered Exchange Offer shall remain open; and
     (e) otherwise comply in all material respects with all applicable laws.
     As soon as practicable after the close of the Registered Exchange Offer or
the Private Exchange, as the case may be, the Company shall:
     (x) accept for exchange all the Securities validly tendered and not
withdrawn pursuant to the Registered Exchange Offer and the Private Exchange;
and
     (y) cause the Trustee to deliver promptly to each Holder of the Initial
Securities, Exchange Securities or Private Exchange Securities, as the case may
be, equal in principal amount to the Initial Securities of such Holder so
accepted for exchange.
     The Indenture will provide that the Exchange Securities will not be subject
to the transfer restrictions set forth in the Indenture and that all the
Securities will vote and consent together on all matters as one class and that
none of the Securities will have the right to vote or consent as a class
separate from one another on any matter.
     Interest on each Exchange Security and Private Exchange Security issued
pursuant to the Registered Exchange Offer and in the Private Exchange will
accrue (i) from the later of (A) the last interest payment date on which
interest was paid on the Initial Securities surrendered in

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exchange therefor or (B) if the Initial Securities are surrendered for exchange
on a date in a period which includes the record date for an interest payment
date to occur on or after the date of such exchange and as to which interest was
paid, the date of such interest payment date or (ii) if no interest has been
paid on the Initial Securities, from the Issue Date.
     Each Holder participating in the Registered Exchange Offer shall be
required as a condition to participation in the Registered Exchange Offer to
represent to the Company that (i) any Exchange Securities received by such
Holder will be acquired in the ordinary course of its business, (ii) that at the
time of the commencement and consummation of the Registered Exchange Offer, such
Holder has no arrangements or understandings with any person to participate in
the distribution of the Securities or the Exchange Securities within the meaning
of the Securities Act, (iii) such Holder is not an “affiliate,” as defined in
Rule 405 of the Securities Act, of the Company or if it is an affiliate, such
Holder will comply with the registration and prospectus delivery requirements of
the Securities Act to the extent applicable, (iv) if such Holder is not a
broker-dealer, that it is not engaged in, and does not intend to engage in, the
distribution of the Exchange Securities and (v) if such Holder is a
broker-dealer, that it will receive Exchange Securities for its own account in
exchange for Initial Securities that were acquired as a result of market-making
activities or other trading activities and that it will be required to
acknowledge that it will deliver a prospectus in connection with any resale of
such Exchange Securities.
     Notwithstanding any other provisions hereof, the Company will ensure that
(i) any Exchange Offer Registration Statement and any amendment thereto and any
prospectus forming part thereof and any supplement thereto comply in all
material respects with the Securities Act and the rules and regulations
thereunder, (ii) any Exchange Offer Registration Statement and any amendment
thereto do not, when they become effective, contain 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 and (iii) any prospectus
forming part of any Exchange Offer Registration Statement, and any supplement to
such prospectus, do not include an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
     2. Shelf Registration. If, (i) because of any change in law or in
applicable interpretations thereof by the staff of the Commission, the Company
is not permitted to effect a Registered Exchange Offer, as contemplated by
Section 1 hereof, (ii) the Registered Exchange Offer is not consummated within
250 days of the Issue Date, (iii) any Initial Purchaser so requests with respect
to the Initial Securities (or the Private Exchange Securities) not eligible to
be exchanged for Exchange Securities in the Registered Exchange Offer and held
by it following consummation of the Registered Exchange Offer or (iv) any Holder
(other than an Exchanging Dealer) is not eligible to participate in the
Registered Exchange Offer or, in the case of any Holder (other than an
Exchanging Dealer) that participates in the Registered Exchange Offer, such
Holder does not receive freely tradeable Exchange Securities on the date of the
exchange and, with respect to (iii) and (iv) above, the Initial Purchaser has so
notified the Company within 90 days after the consummation of the Registered
Exchange Offer, the Company shall take the following actions:

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     (a) The Company shall, at its cost, as promptly as practicable file with
the Commission and thereafter shall use its reasonable best efforts to cause to
be declared effective (unless it becomes effective automatically upon filing) a
registration statement (the “Shelf Registration Statement” and, together with
the Exchange Offer Registration Statement, a “Registration Statement”) on an
appropriate form under the Securities Act relating to the offer and sale of the
Transfer Restricted Securities by the Holders thereof from time to time in
accordance with the methods of distribution set forth in the Shelf Registration
Statement and Rule 415 under the Securities Act (hereinafter, the “Shelf
Registration”) on or prior to the 210th day following the Issue Date in the case
of clause (i) above and on or prior to the 90th day after the date on which the
Shelf Registration Statement is required to be filed in the case of clauses
(ii), (iii) and (iv) above; provided, however, that no Holder (other than an
Initial Purchaser) shall be entitled to have the Securities held by it covered
by such Shelf Registration Statement unless such Holder agrees in writing to be
bound by all the provisions of this Agreement applicable to such Holder.
     (b) The Company shall use its reasonable best efforts to keep the Shelf
Registration Statement continuously effective, in order to permit the prospectus
included therein to be lawfully delivered by the Holders of the relevant
Securities, for a period of two years (or for such longer period if extended
pursuant to Section 3(j) below) from the date hereof or such shorter period that
will terminate when all the Securities covered by the Shelf Registration
Statement (i) have been sold pursuant thereto, (ii) may be sold without any
limitations under clauses (c), (e), (f) and (h) of Rule 144 under the Securities
Act, or any successor rule thereof) or (iii) all such Securities cease to be
outstanding (the “Shelf Registration Period”).
     (c) Notwithstanding any other provisions of this Agreement to the contrary,
the Company shall cause (i) the Shelf Registration Statement and any amendment
thereto and any related prospectus and any supplement thereto, as of the
effective date of the Shelf Registration Statement, amendment or supplement, to
comply in all material respects with the Securities Act and the rules and
regulations thereunder, (ii) the Shelf Registration Statement and any amendment
thereto not to contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary in order to make the
statements therein not misleading and (iii) the prospectus related to the Shelf
Registration Statement, and any supplement to such prospectus, not to include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
     3. Registration Procedures. In connection with any Shelf Registration
contemplated by Section 2 hereof and, to the extent applicable, any Registered
Exchange Offer contemplated by Section 1 hereof, the following provisions shall
apply:
     (a) The Company shall (i) furnish to each Initial Purchaser, prior to the
filing thereof with the Commission, a copy of the Registration Statement and
each amendment thereof and each supplement, if any, to the prospectus included
therein and, in the event that an Initial Purchaser (with respect to any portion
of an unsold allotment from the original offering) is participating in the
Registered Exchange Offer or the Shelf Registration

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Statement, the Company shall use its reasonable best efforts to reflect in each
such document, when so filed with the Commission, such comments as such Initial
Purchaser reasonably may propose; (ii) include the information set forth in
Annex A hereto on the cover, in Annex B hereto in the “Exchange Offer
Procedures” section and the “Purpose of the Exchange Offer” section and in Annex
C hereto in the “Plan of Distribution” section of the prospectus forming a part
of the Exchange Offer Registration Statement and include the information set
forth in Annex D hereto in the Letter of Transmittal delivered pursuant to the
Registered Exchange Offer; (iii) if requested by an Initial Purchaser, include
the information required by Items 507 or 508 of Regulation S-K under the
Securities Act, as applicable, in the prospectus forming a part of the Exchange
Offer Registration Statement; (iv) include within the prospectus contained in
the Exchange Offer Registration Statement a section entitled “Plan of
Distribution,” reasonably acceptable to the Initial Purchasers, which shall
contain a summary statement of the positions taken or policies made by the staff
of the Commission with respect to the potential “underwriter” status of any
broker-dealer that is the beneficial owner (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”) of Exchange
Securities received by such broker-dealer in the Registered Exchange Offer (a
“Participating Broker-Dealer”), whether such positions or policies have been
publicly disseminated by the staff of the Commission or such positions or
policies, in the reasonable judgment of the Initial Purchasers based upon advice
of counsel (which may be in-house counsel), represent the prevailing views of
the staff of the Commission; and (v) in the case of a Shelf Registration
Statement, include in the prospectus included in the Shelf Registration
Statement (or, if permitted by Commission Rule 430B(b), in a prospectus
supplement that becomes a part thereof pursuant to Commission Rule 430B(f)) that
is delivered to any Holder pursuant to Section 3(d) and (f), the names of the
Holders, who propose to sell Securities pursuant to the Shelf Registration
Statement, as selling securityholders.
     (b) The Company shall give written notice to the Initial Purchasers, the
Holders of the Securities proposed to be sold under the Shelf Registration
Statement and any Participating Broker-Dealer from whom the Company has received
prior written notice that it will be a Participating Broker-Dealer in the
Registered Exchange Offer (which notice pursuant to clauses (ii)-(v) hereof
shall be accompanied by an instruction to suspend the use of the prospectus
until the requisite changes have been made):
     (i) when the Registration Statement or any amendment thereto has been filed
with the Commission and when the Registration Statement or any post-effective
amendment thereto has become effective;
     (ii) of any request by the Commission for amendments or supplements to the
Registration Statement or the prospectus included therein or for additional
information;
     (iii) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose, of the issuance by the Commission of a notification of
objection to the use of the form on which the Registration Statement has been
filed, and of the

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happening of any event that causes the Company to become an “ineligible issuer,”
as defined in Commission Rule 405;
     (iv) of the receipt by the Company or its legal counsel of any notification
with respect to the suspension of the qualification of the Securities for sale
in any jurisdiction or the initiation or threatening of any proceeding for such
purpose; and
     (v) of the happening of any event that requires the Company to make changes
in the Registration Statement or the prospectus in order that the Registration
Statement or the prospectus do not contain an untrue statement of a material
fact nor omit to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of the prospectus, in
light of the circumstances under which they were made) not misleading.
     (c) The Company shall make every reasonable effort to obtain the withdrawal
at the earliest possible time, of any order suspending the effectiveness of the
Registration Statement.
     (d) The Company shall furnish to each Holder of Securities included within
the coverage of the Shelf Registration, without charge, at least one copy of the
Shelf Registration Statement and any post-effective amendment or supplement
thereto, including financial statements and schedules, and, if the Holder so
requests in writing, all exhibits thereto (including those, if any, incorporated
by reference). The Company shall not, without the prior consent of the Initial
Purchasers, make any offer relating to the Securities that would constitute a
“free writing prospectus,” as defined in Commission Rule 405.
     (e) The Company shall deliver to each Initial Purchaser, and to any other
Holder who so requests, without charge, at least one copy of the Exchange Offer
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules, and, if any Initial Purchaser or any such
Holder requests, all exhibits thereto (including those incorporated by
reference).
     (f) The Company shall, during the Shelf Registration Period, deliver to
each Holder of Securities included within the coverage of the Shelf
Registration, without charge, as many copies of the prospectus (including each
preliminary prospectus) included in the Shelf Registration Statement and any
amendment or supplement thereto as such person may reasonably request. Subject
to the other provisions of this Agreement, the Company consents to the use of
the prospectus or any amendment or supplement thereto by each of the selling
Holders of the Securities in connection with the offering and sale of the
Securities covered by the prospectus, or any amendment or supplement thereto,
included in the Shelf Registration Statement.
     (g) The Company shall deliver to each Initial Purchaser, any Exchanging
Dealer, any Participating Broker-Dealer and such other persons required to
deliver a prospectus following the Registered Exchange Offer, without charge, as
many copies of the final prospectus included in the Exchange Offer Registration
Statement and any amendment or supplement thereto as such persons may reasonably
request. Subject to the other

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provisions of this Agreement, the Company consents to the use of the prospectus
or any amendment or supplement thereto by any Initial Purchaser, if necessary,
any Participating Broker-Dealer and such other persons required to deliver a
prospectus following the Registered Exchange Offer in connection with the
offering and sale of the Exchange Securities covered by the prospectus, or any
amendment or supplement thereto, included in such Exchange Offer Registration
Statement.
     (h) Prior to any public offering of the Securities, pursuant to any
Registration Statement, the Company shall use its reasonable best efforts to
register or qualify or cooperate with the Holders of the Securities included
therein and their respective counsel in connection with the registration or
qualification of the Securities for offer and sale under the securities or “blue
sky” laws of such states of the United States as any Holder of the Securities
reasonably requests in writing and do any and all other acts or things
reasonably necessary or advisable to enable the offer and sale in such
jurisdictions of the Securities covered by such Registration Statement;
provided, however, that the Company shall not be required to (i) qualify
generally to do business in any jurisdiction where it is not then so qualified
or (ii) take any action which would subject it to general service of process or
to taxation in any jurisdiction where it is not then so subject.
     (i) To the extent the Securities are not in book-entry form, the Company
shall cooperate with the Holders of the Securities to facilitate the timely
preparation and delivery of certificates representing the Securities to be sold
pursuant to any Registration Statement free of any restrictive legends and in
such denominations and registered in such names as the Holders may request a
reasonable period of time prior to sales of the Securities pursuant to such
Registration Statement.
     (j) Upon the occurrence of any event contemplated by clauses (ii) through
(v) of Section 3(b) above during the period for which the Company is required to
maintain an effective Registration Statement, the Company shall promptly prepare
and file a post-effective amendment to the Registration Statement or a
supplement to the related prospectus and any other required document so that, as
thereafter delivered to Holders of the Securities or purchasers of Securities,
the prospectus will not contain an untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading. If the Company notifies the Initial Purchasers, the
Holders of the Securities and any known Participating Broker-Dealer in
accordance with clauses (ii) through (v) of Section 3(b) above to suspend the
use of the prospectus until the requisite changes to the prospectus have been
made, then the Initial Purchasers, the Holders of the Securities and any such
Participating Broker-Dealers shall suspend use of such prospectus, and the
period of effectiveness of the Shelf Registration Statement provided for in
Section 2(b) above and the Exchange Offer Registration Statement provided for in
Section 1 above shall each be extended by the number of days from and including
the date of the giving of such notice to and including the date when the Initial
Purchasers, the Holders of the Securities and any known Participating
Broker-Dealer shall have received such amended or supplemented prospectus
pursuant to this Section 3(j). During the period during which the Company is
required to maintain an effective Shelf Registration Statement pursuant to this
Agreement, the Company will,

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prior to the three-year expiration of that Shelf Registration Statement, file
and use its reasonable best efforts to cause to be declared effective (unless it
becomes effective automatically upon filing) within a period that avoids any
interruption in the ability of Holders of Securities covered by the expiring
Shelf Registration Statement to make registered dispositions, a new registration
statement relating to the Securities, which shall be deemed the “Shelf
Registration Statement” for purposes of this Agreement.
     (k) Not later than the effective date of the applicable Registration
Statement, the Company will provide a CUSIP number for the Initial Securities,
the Exchange Securities or the Private Exchange Securities, as the case may be,
and provide the Trustee with certificates for the Initial Securities, the
Exchange Securities or the Private Exchange Securities, as the case may be, in a
form eligible for deposit with The Depository Trust Company.
     (l) The Company will comply in all material respects with all rules and
regulations of the Commission to the extent and so long as they are applicable
to the Registered Exchange Offer or the Shelf Registration.
     (m) The Company shall cause the Indenture to be qualified under the Trust
Indenture Act of 1939, as amended, in a timely manner and containing such
changes, if any, as shall be necessary for such qualification. In the event that
such qualification would require the appointment of a new trustee under the
Indenture, the Company shall appoint a new trustee thereunder pursuant to the
applicable provisions of the Indenture.
     (n) The Company may require each Holder of Securities to be sold pursuant
to the Shelf Registration Statement to furnish to the Company such information
regarding the Holder and the distribution of the Securities as the Company may
from time to time reasonably require for inclusion in the Shelf Registration
Statement, and the Company may exclude from such registration the Securities of
any Holder that unreasonably fails to furnish such information within a
reasonable time after receiving such request.
     (o) The Company shall enter into such customary agreements (including, if
requested, an underwriting agreement in customary form) and take all such other
action, if any, as any Holder of the Securities shall reasonably request in
order to facilitate the disposition of the Securities pursuant to any Shelf
Registration.
     (p) In the case of any Shelf Registration, the Company shall (i) make
reasonably available for inspection by the Holders of the Securities, any
underwriter participating in any disposition pursuant to the Shelf Registration
Statement and any attorney, accountant or other agent retained by the Holders of
the Securities or any such underwriter all relevant financial and other records,
pertinent corporate documents and properties of the Company and (ii) cause the
Company’s officers, directors, employees, accountants and auditors to supply all
relevant information reasonably requested by the Holders of the Securities or
any such underwriter, attorney, accountant or agent in connection with the Shelf
Registration Statement, in each case, as shall be reasonably necessary to enable
such persons, to conduct a reasonable investigation within the meaning of
Section 11 of the Securities Act; provided, however, that the foregoing
inspection and information gathering shall be coordinated on behalf of the
Initial Purchasers by you and on behalf of

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the other parties, by one counsel designated by and on behalf of such other
parties as described in Section 4 hereof; provided further, however, that any
information that is designated in writing by the Company, in good faith, as
confidential at the time of delivery of such information shall be kept
confidential by the Holders or any such underwriter, attorney, accountant or
other agent, unless such disclosure is made in connection with a court
proceeding or required by law, or such information is or becomes available to
the public generally or through a third party without, to the knowledge of any
recipient of confidential information, an accompanying obligation of
confidentiality or is independently developed.
     (q) In the case of any Shelf Registration, the Company, if requested by any
Holder of the Securities covered thereby, shall cause (i) its counsel to deliver
an opinion and updates thereof relating to the Securities in customary form
addressed to such Holders and the managing underwriters, if any, thereof and
dated, in the case of the initial opinion, the effective date of such Shelf
Registration Statement; (ii) its officers to execute and deliver all customary
documents and certificates and updates thereof requested by any underwriters of
the applicable Securities and (iii) its independent public accountants and the
independent public accountants with respect to any other entity for which
financial information is provided in the Shelf Registration Statement to provide
to the selling Holders of the applicable Securities and any underwriter therefor
a comfort letter in customary form and covering matters of the type customarily
covered in comfort letters in connection with primary underwritten offerings,
subject to receipt of appropriate documentation as contemplated, and only if
permitted, by Statement of Auditing Standards No. 72.
     (r) If a Registered Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Initial Securities by Holders to the Company
(or to such other Person as directed by the Company) in exchange for the
Exchange Securities or the Private Exchange Securities, as the case may be, the
Company shall mark, or cause to be marked, on the Initial Securities so
exchanged that such Initial Securities are being canceled in exchange for the
Exchange Securities or the Private Exchange Securities, as the case may be; in
no event shall the Initial Securities be marked as paid or otherwise satisfied.
     (s) The Company will use its reasonable best efforts to (a) if the Initial
Securities have been rated prior to the initial sale of such Initial Securities,
confirm such ratings will apply to the Securities covered by a Shelf
Registration Statement, or (b) if the Initial Securities were not previously
rated, cause the Securities covered by a Shelf Registration Statement to be
rated with the appropriate rating agencies, but in each case only if so
requested by Holders of a majority in aggregate principal amount of Securities
covered by such Registration Statement, or by the managing underwriters, if any.
     (t) In the event that any broker-dealer registered under the Exchange Act
shall underwrite any Securities or participate as a member of an underwriting
syndicate or selling group or “assist in the distribution” (within the meaning
of the Conduct Rules (the “Rules”) of the National Association of Securities
Dealers, Inc. (“NASD”)) thereof, whether as a Holder of such Securities or as an
underwriter, a placement or sales agent or a broker or dealer in respect
thereof, or otherwise, the Company will assist such broker-dealer in complying
with the requirements of such Rules, including, without limitation,

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by (i) if such Rules, including Rule 2720, shall so require, engaging a
“qualified independent underwriter” (as defined in Rule 2720) to participate in
the preparation of the Registration Statement relating to such Securities, to
exercise usual standards of due diligence in respect thereto and, if any portion
of the offering contemplated by such Registration Statement is an underwritten
offering or is made through a placement or sales agent, to recommend the yield
of such Securities, (ii) indemnifying any such qualified independent underwriter
to the extent of the indemnification of underwriters provided in Section 5
hereof and (iii) providing such information to such broker-dealer as may be
required in order for such broker-dealer to comply with the requirements of the
Rules.
     (u) The Company shall use its reasonable best efforts to take all other
steps necessary to effect the registration of the Securities covered by a
Registration Statement contemplated hereby.
     4. Registration Expenses. The Company shall bear all fees and expenses
incurred in connection with the performance of its obligations under Sections 1
through 3 hereof (including the reasonable fees and expenses, if any, of counsel
for the Initial Purchasers incurred in connection with blue sky qualifications
in connection with the Registered Exchange Offer), whether or not the Registered
Exchange Offer or a Shelf Registration is filed or becomes effective, and, in
the event of a Shelf Registration, shall bear or reimburse the Holders of the
Securities covered thereby for the reasonable fees and disbursements of one firm
of counsel designated by the Holders of a majority in principal amount of the
Initial Securities covered thereby to act as counsel for the Holders of the
Initial Securities in connection therewith. Each Holder shall be responsible for
paying all underwriting discounts and commissions, if any, relating to the sale
or disposition of such Holder’s Securities pursuant to a Shelf Registration
Statement.
     5. Indemnification.
     (a) The Company agrees to indemnify and hold harmless each Holder of the
Securities, any Participating Broker-Dealer and each person, if any, who
controls such Holder or such Participating Broker-Dealer within the meaning of
Section 15 of the Securities Act or Section 20(a) of the Exchange Act (each
Holder, any Participating Broker-Dealer and such controlling persons are
referred to collectively as the “Indemnified Parties”) from and against any
losses, claims, damages or liabilities, joint or several, or any actions in
respect thereof (including, but not limited to, any losses, claims, damages or
liabilities relating to purchases and sales of the Securities) to which each
Indemnified Party may become subject under the Securities Act, the Exchange Act
or otherwise, insofar as such losses, claims, damages or liabilities arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in a Registration Statement or prospectus or in any
amendment or supplement thereto or in any preliminary prospectus or “issuer free
writing prospectus,” as defined in Commission Rule 433 (“Issuer FWP”), relating
to a Shelf Registration, 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 shall reimburse,
as incurred, the Indemnified Parties for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,

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claim, damage, liability or action in respect thereof; provided, however, that
(i) the Company will not be liable in any such case to the extent that such
loss, claim, damage or liability arises out of or is based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus or Issuer FWP relating to a Shelf Registration
in reliance upon and in conformity with written information pertaining to such
Holder and furnished to the Company by or on behalf of such Holder specifically
for inclusion therein and (ii) with respect to any untrue statement or omission
or alleged untrue statement or omission of a material fact made in any
preliminary prospectus relating to a Shelf Registration Statement, the indemnity
agreement contained in this subsection (a) shall not inure to the benefit of any
Holder or Participating Broker-Dealer from whom the person asserting any such
losses, claims or damages purchased the Securities concerned, to the extent that
a prospectus relating to such Securities was required to be delivered (including
through satisfaction of the conditions of Commission Rule 172) by such Holder or
Participating Broker-Dealer under the Securities Act in connection with such
purchase and any such loss, claim, damage or liability of such Holder or
Participating Broker-Dealer results from the fact that there was not sent or
given to such person, at or prior to the time of the sale of such Securities to
such person, an amended or supplemented prospectus or, if permitted by
Section 3(d), an Issuer FWP correcting such untrue statement or omission or
alleged untrue statement or omission of a material fact if the Company had
previously furnished copies thereof to such Holder or Participating
Broker-Dealer; provided further, however, that this indemnity agreement will be
in addition to any liability which the Company may otherwise have to such
Indemnified Party. The Company shall also indemnify any underwriters, their
officers and directors and each person who controls such underwriters within the
meaning of the Securities Act or the Exchange Act to the same extent as provided
above with respect to the indemnification of the Holders of the Securities if
requested by such Holders.
     (b) Each Holder of the Securities, severally and not jointly, will
indemnify and hold harmless the Company and its directors, officers, employees
and each person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act or Section 20(a) of the Exchange Act from and
against any losses, claims, damages or liabilities in respect thereof
(including, but not limited to, any losses, claims, damages or liabilities
relating to purchases and sales of the Securities), to which the Company or any
such Guarantor, their directors, officers, employees or any such controlling
person may become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities arise out of
or are based upon any untrue statement or alleged untrue statement of a material
fact contained in a Registration Statement or prospectus or in any amendment or
supplement thereto or in any preliminary prospectus or Issuer FWP relating to a
Shelf Registration, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and shall reimburse,
as incurred, the Company and its directors, officers, employees and controlling
persons for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage or
liability in respect thereof, but in each case only to the extent that the
untrue statement or omission or alleged untrue

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statement or omission was made in reliance upon and in conformity with written
information pertaining to such Holder and furnished to the Company by or on
behalf of such Holder specifically for inclusion therein; and, subject to the
limitation set forth immediately preceding this clause, shall reimburse, as
incurred, the Company or its directors, officers and employees or any such
controlling person for any legal or other expenses reasonably incurred by the
Company or its directors, officers and employees or any such controlling person
in connection with investigating or defending any loss, claim, damage, liability
or action in respect thereof. This indemnity agreement will be in addition to
any liability that such Holder may otherwise have to the Company, its directors,
officers and employees or any such controlling person.
     (c) Promptly after receipt by an indemnified party under this Section 5 of
notice of the commencement of any action or proceeding (including a governmental
investigation), such indemnified party will, if a claim in respect thereof is to
be made against the indemnifying party under this Section 5, notify the
indemnifying party of the commencement thereof; but the failure to notify the
indemnifying party shall not relieve the indemnifying party from any liability
that it may have under subsection (a) or (b) above except to the extent that it
has been materially prejudiced (through the forfeiture of substantive rights or
defenses) by such failure; and provided further that the failure to notify the
indemnifying party shall not relieve it from any liability that it may have to
an indemnified party otherwise than under subsection (a) or (b) above. In case
any such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof the
indemnifying party will not be liable to such indemnified party under this
Section 5 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in connection
with the defense thereof. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party unless such settlement (i) includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action, and (ii) does not include a statement as to or an admission of
fault, culpability or a failure to act by or on behalf of any indemnified party.
     (d) If the indemnification provided for in this Section 5 is unavailable or
insufficient to hold harmless an indemnified party under subsections (a) or
(b) above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to in subsection (a) or
(b) above (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party on the other from the exchange of the Securities, pursuant to
the Registered Exchange Offer, or (ii) if the allocation provided by the
foregoing clause (i) is

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not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the indemnifying party or parties on the one hand and the
indemnified party on the other in connection with the statements or omissions
that resulted in such losses, claims, damages or liabilities (or actions in
respect thereof) as well as any other relevant equitable considerations. The
relative fault of the parties 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 Company on the one hand or such Holder or such other indemnified
party, as the case may be, on the other, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid by an indemnified party as a result of
the losses, claims, damages or liabilities referred to in the first sentence of
this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this subsection (d).
Notwithstanding any other provision of this Section 5(d), the Holders of the
Securities shall not be required to contribute any amount in excess of the
amount by which the net proceeds received by such Holders from the sale of the
Securities pursuant to a Registration Statement exceeds the amount of damages
which such Holders have otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission. 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. For purposes of this subsection
(d), each person, if any, who controls such indemnified party within the meaning
of the Securities Act or the Exchange Act shall have the same rights to
contribution as such indemnified party and each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act shall have
the same rights to contribution as the Company.
     (e) The agreements contained in this Section 5 shall survive the sale of
the Securities pursuant to a Registration Statement and shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any indemnified party.
     6. Additional Interest Under Certain Circumstances.
     (a) By way of liquidated damages, additional interest (the “Additional
Interest”) with respect to the Initial Securities shall be assessed as follows
if any of the following events occur (each such event in clauses (i) through
(vi) below a “Registration Default”):
     (i) If an Exchange Offer Registration Statement is not filed with the
Commission on or prior to the 180th day after the Issue Date;
     (ii) If an Exchange Offer Registration Statement or, if required pursuant
to Section 2(i) above, a Shelf Registration Statement has not been declared
effective by the Commission (or become effective automatically) on or prior to
the 210th day after the Issue Date;

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     (iii) If the Registered Exchange Offer has not been consummated on or
before the 30th business day after the Exchange Offer Registration Statement is
declared effective;
     (iv) If obligated to file the Shelf Registration Statement pursuant to
pursuant to Section 2(ii)-(iv) above, the Shelf Registration Statement does not
become, or is not declared, effective by the Commission on or prior to the 90th
day after the date on which the Shelf Registration Statement is required to be
filed; or
     (v) If after either the Exchange Offer Registration Statement or the Shelf
Registration Statement is declared (or becomes automatically) effective (A) such
Registration Statement thereafter ceases to be effective and is not declared
effective again within 30 days or (B) such Registration Statement or the related
prospectus ceases to be usable (except as permitted in subsection (b) below) and
does not become usable again within 30 days in connection with resales of
Transfer Restricted Securities (defined below) during the periods specified
herein because either (1) any event occurs as a result of which the related
prospectus forming part of such Registration Statement would include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein in the light of the circumstances under which they
were made not misleading, or (2) it shall be necessary to amend such
Registration Statement or supplement the related prospectus, to comply with the
Securities Act or the Exchange Act or the respective rules thereunder.
     Additional Interest shall accrue on the Initial Securities over and above
the interest set forth in the title of the Securities from and including the
date on which any such Registration Default shall occur to but excluding the
date on which all such Registration Defaults have been cured. The rate of the
Additional Interest will be 0.25% per year for the first 90-day period
immediately following the occurrence of a Registration Default, and such rate
will increase by an additional 0.25% per year with respect to each subsequent
90-day period until all Registration Defaults have been cured, up to a maximum
Additional Interest rate of 1.0% per year. The Company will pay such Additional
Interest on regular interest payment dates. Such Additional Interest will be in
addition to any other interest payable from time to time with respect to the
Notes and the Exchange Securities. The Company will not be required to pay
Additional Interest for more than one Registration Default at any given time.
Following the cure of all Registration Defaults, the accrual of Additional
Interest will cease and the interest rate will revert to the original rate,
10.25%.
     (b) A Registration Default referred to in Section 6(a)(v)(B) hereof shall
be deemed not to have occurred and be continuing in relation to a Shelf
Registration Statement or the related prospectus if (i) such Registration
Default has occurred solely as a result of (x) the filing of a post-effective
amendment to such Shelf Registration Statement to incorporate annual audited
financial information with respect to the Company where such post-effective
amendment is not yet effective and needs to be declared effective to permit
Holders to use the related prospectus or (y) other material events have occurred
that would need to be described in such Shelf Registration Statement or the
related prospectus

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and (ii) in the case of clause (y) a majority of the Company’s board of
directors (the “Board”) has determined in good faith that the offer or sale of
Securities thereunder would (A) materially impede, delay or interfere with any
material pending or proposed financing, acquisition, corporate reorganization or
other similar transaction involving the Company for which the Board has
authorized negotiations or (B) require disclosure of material nonpublic
information which, if disclosed at such time, would be materially harmful to the
Company’s interests; provided, however, that in any case if one or more such
Registration Defaults occur for a period aggregating in excess of 90 days in any
12-month period, Additional Interest shall be payable in accordance with the
above paragraph from the day such Registration Default would have been deemed to
occur but for this Section 6(b) until such Registration Default is cured.
     (c) Any amounts of Additional Interest due pursuant to Section 6(a) above
will be payable in cash on the regular interest payment dates with respect to
the Initial Securities. The amount of Additional Interest will be determined by
multiplying the applicable Additional Interest rate by the principal amount of
the Initial Securities, multiplied by a fraction, the numerator of which is the
number of days such Additional Interest rate was applicable during such period
(determined on the basis of a 360-day year comprised of twelve 30-day months),
and the denominator of which is 360.
     (d) “Transfer Restricted Securities” means each Security until (i) the date
on which such Transfer Restricted Security has been exchanged by a person other
than a broker-dealer for a freely transferable Exchange Security in the
Registered Exchange Offer, (ii) following the exchange by a broker-dealer in the
Registered Exchange Offer of an Initial Security for an Exchange Security, the
date on which such Exchange Security is sold to a purchaser who receives from
such broker-dealer on or prior to the date of such sale a copy of the prospectus
contained in the Exchange Offer Registration Statement, (iii) the date on which
such Initial Security has been effectively registered under the Securities Act
and disposed of in accordance with the Shelf Registration Statement or (iv) the
date on which such Initial Securities is distributed to the public pursuant to
Rule 144 under the Securities Act or is saleable pursuant to Rule 144(k) under
the Securities Act.
     7. Rules 144 and 144A. The Company shall use its reasonable best efforts to
file the reports required to be filed by it under the Securities Act and the
Exchange Act in a timely manner and, if at any time the Company is not required
to file such reports, it will, upon the request of any Holder of Initial
Securities, make publicly available other information so long as necessary to
permit sales of their securities pursuant to Rules 144 and 144A. The Company
covenants that it will take such further action as any Holder of Initial
Securities may reasonably request, all to the extent required from time to time
to enable such Holder to sell Initial Securities without registration under the
Securities Act within the limitation of the exemptions provided by Rules 144 and
144A (including the requirements of Rule 144A(d)(4)). The Company will provide a
copy of this Agreement to prospective purchasers of Initial Securities
identified to the Company by the Initial Purchasers upon request. Upon the
request of any Holder of Initial Securities, the Company shall deliver to such
Holder a written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to
require the Company to register any of its securities pursuant to the Exchange
Act.

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     8. Underwritten Registrations. If any of the Transfer Restricted Securities
covered by any Shelf Registration are to be sold in an underwritten offering,
the investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Holders of a majority in
aggregate principal amount of such Transfer Restricted Securities to be included
in such offering; provided, that such investment banker or investment bankers
and manager or managers must be reasonably acceptable to the Company.
     No person may participate in any underwritten registration hereunder unless
such person (i) agrees to sell such person’s Transfer Restricted Securities on
the basis reasonably provided in any underwriting arrangements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.
     9. Miscellaneous.
     (a) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, except by the Company and the written
consent of the Holders of a majority in principal amount of (or, in the case of
any Additional Interest, all) the Securities affected by such amendment,
modification, supplement, waiver or consent.
     (b) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand delivery, first-class mail, facsimile
transmission, or air courier that guarantees overnight delivery:
     (i) if to a Holder of the Securities, at the most current address given by
such Holder to the Company;
     (ii) if to the Initial Purchasers:
Jefferies & Company, Inc.
520 Madison Avenue, 10th Floor
New York, NY 10022
Fax No.: (212) 284-2280
Attention: Leveraged Finance
with a copy to:
Vinson & Elkins L.L.P.
2500 First City Tower
1001 Fannin Street
Houston, Texas 77002
Fax No.: (713) 615-5531
Attention: T. Mark Kelly;

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     (iii) if to the Company:
Parallel Petroleum Corporation
1004 N. Big Spring, Suite 400
Midland, Texas 79701
Fax No.: (432) 684-3905
Attention: Steven D. Foster
with a copy to:
Haynes & Boone LLP
901 Main Street, Suite 3100
Dallas, Texas 75202
Fax No.: (214) 651-5940
Attention: W. Scott Wallace
     All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; three business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
is acknowledged by recipient’s facsimile machine operator, if sent by facsimile
transmission; and on the day delivered, if sent by overnight air courier
guaranteeing next day delivery.
     Unless otherwise indicated, all references herein to “days” are to calendar
days.
     (c) No Inconsistent Agreements. The Company has not, as of the date hereof,
entered into, nor shall it, on or after the date hereof, enter into, any
agreement with respect to its securities that is inconsistent with the rights
granted to the Holders herein or otherwise conflicts with the provisions hereof.
     (d) Successors and Assigns. This Agreement shall be binding upon the
Company and its successors and assigns.
     (e) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
     (f) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
     (g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
     (h) Severability. If any one or more of the provisions contained herein, or
the application thereof in any circumstance, is held invalid, illegal or
unenforceable, the validity, legality and enforceability of any such provision
in every other respect and of the remaining provisions contained herein shall
not be affected or impaired thereby.

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     (i) Securities Held by the Company. Whenever the consent or approval of
Holders of a specified percentage of principal amount of Securities is required
hereunder, Securities held by the Company or its affiliates (other than
subsequent Holders of Securities if such subsequent Holders are deemed to be
affiliates solely by reason of their holdings of such Securities) shall not be
counted in determining whether such consent or approval was given by the Holders
of such required percentage.
     (j) Submission to Jurisdiction. By the execution and delivery of this
Agreement, the Company submits to the nonexclusive jurisdiction of any competent
federal or state court in the City and State of New York in any suit or
proceeding arising out of or relating to this Agreement or brought under federal
or state securities laws.

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     If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the several Initial Purchasers and the Company in accordance with its terms.

             
 
                Very truly yours,    
 
                PARALLEL PETROLEUM CORPORATION,         a Delaware corporation  
 
 
           
 
  By:   /s/ Larry C. Oldham    
 
           
 
      Larry C. Oldham    
 
      President and Chief Executive Officer    

Signature Page to the Registration Rights Agreement

 

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The foregoing Registration
Rights Agreement is hereby confirmed
and accepted as of the date first
above written.
Jefferies & Company, Inc.
Merrill Lynch, Pierce, Fenner &
     Smith Incorporated
BNP Paribas Securities Corp.
By: Jefferies & Company, Inc.

         
 
       
By:
  /s/ Frank Bracken
 
Managing Director    

Signature Page to the Registration Rights Agreement

 

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ANNEX A
     Each broker-dealer that receives Exchange Securities for its own account
pursuant to the Registered Exchange Offer must acknowledge that it will deliver
a prospectus in connection with any resale of such Exchange Securities. The
Letter of Transmittal states that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
“underwriter” within the meaning of the Securities Act. This Prospectus, as it
may be amended or supplemented from time to time, may be used by a broker-dealer
in connection with resales of Exchange Securities received in exchange for
Initial Securities where such Initial Securities were acquired by such
broker-dealer as a result of market-making activities or other trading
activities. The Company has agreed that, for a period of up to 180 days after
the consummation of the Registered Exchange Offer, it will make this Prospectus
available to any broker-dealer for use in connection with any such resale. See
“Plan of Distribution.”
 A-1

 

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ANNEX B
     Each broker-dealer that receives Exchange Securities for its own account in
exchange for Securities, where such Initial Securities were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Securities. See “Plan of Distribution.”

B-1

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ANNEX C
PLAN OF DISTRIBUTION
     Each broker-dealer that receives Exchange Securities for its own account
pursuant to the Registered Exchange Offer must acknowledge that it will deliver
a prospectus in connection with any resale of such Exchange Securities. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of Exchange Securities received in
exchange for Initial Securities where such Initial Securities were acquired as a
result of market-making activities or other trading activities. The Company has
agreed that, for a period ending on the earlier of (a) 180 days after the
consummation of the Registered Exchange Offer and (b) the date on which a
broker-dealer is no longer required to deliver a prospectus in connection with
market-making or other trading activities, it will make this prospectus, as
amended or supplemented, available to any broker-dealer for use in connection
with any such resale. In addition, until            , 200 (90 days after the
consummation of the Registered Exchange Offer), all dealers effecting
transactions in the Exchange Securities may be required to deliver a prospectus.
     The Company will not receive any proceeds from any sale of Exchange
Securities by broker-dealers. Exchange Securities received by broker-dealers for
their own account pursuant to the Exchange Offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the Exchange Securities or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any such Exchange
Securities. Any broker-dealer that resells Exchange Securities that were
received by it for its own account pursuant to the Exchange Offer and any broker
or dealer that participates in a distribution of such Exchange Securities may be
deemed to be an “underwriter” within the meaning of the Securities Act and any
profit on any such resale of Exchange Securities and any commission or
concessions received by any such persons may be deemed to be underwriting
compensation under the Securities Act. The Letter of Transmittal states that, by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an “underwriter” within the
meaning of the Securities Act.
     For a period of 180 days after the consummation of the Registered Exchange
Offer, the Company will promptly send additional copies of this Prospectus and
any amendment or supplement to this Prospectus to any broker-dealer that
requests such documents as provided in the Letter of Transmittal. The Company
has agreed to pay all expenses incident to the Exchange Offer (including the
expenses of one counsel for the Holders of the Securities) other than
commissions or concessions of any brokers or dealers and will indemnify the
Holders of the Securities (including any broker-dealers) against certain
liabilities, including liabilities under the Securities Act.
 C-1

 

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ANNEX D

     
o
  CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES
OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.

             
 
           
 
  Name:        
 
           
 
  Address:        
 
           
 
           

If the undersigned is not a broker-dealer, the undersigned represents that it is
not engaged in, and does not intend to engage in, a distribution of Exchange
Securities. If the undersigned is a broker-dealer that will receive Exchange
Securities for its own account in exchange for Initial Securities that were
acquired as a result of market-making activities or other trading activities, it
acknowledges that it will deliver a prospectus in connection with any resale of
such Exchange Securities; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
“underwriter” within the meaning of the Securities Act.
 D-1