Exhibit 10.3

 

AMENDMENT NO. 2 TO
REGISTRATION RIGHTS AGREEMENT

 

AMENDMENT NO. 2, dated April 3, 2014 (this “Amendment”), to REGISTRATION RIGHTS
AGREEMENT, dated August 1, 2012 (as amended from time to time, the “Agreement”),
between Prospect Global Resources, Inc., a Nevada corporation (“Prospect”), and
The Karlsson Group, Inc., an Arizona corporation (“Karlsson”).

 

RECITALS

 

WHEREAS, on May 30, 2012, Prospect issued to Karlsson a warrant (the “May 2012
Warrant”) to purchase up to 112,117 shares of common stock of Prospect (after
giving effect to the 1-50 reverse stock split effected September 4, 2013);

 

WHEREAS, on June 26, 2013, Prospect issued to Karlsson a warrant (the “June 2013
Warrant”)to purchase up to 60,000 shares of common stock of Prospect (after
giving effect to such reverse stock split); and

 

WHEREAS, pursuant to Sixth Extension Agreement, dated the date hereof, among
Karlsson, Parent, and the other Prospect Parties party thereto (“Extension
Agreement”), Karlsson will surrender the May 2012 Warrant and June 2013 Warrant
for shares of Parent common stock (the “Exchange Shares”), which, pursuant to
the Extension Agreement are to be registered for resale on Parent Registration
Statement No. 333-194203 (“RS 194203”).

 

The parties hereby amend the Agreement as follows:

 

1.                                      Amendment.

 

a.                                      Amendment to Definition of Registrable
Securities. Section 1(i) of the Agreement is amended to read as follows:

 

“Registrable Securities” shall mean the Exchange Shares.

 

b.                                      Amendment to Section 2.  Section 2 is
amended to read as follows:

 

(a)  If RS 194203 has not been declared effective by the Prepayment Expiration
Date, as defined in the Extension Agreement, the Company shall, immediately upon
issuing the Warrant, prepare and file with the Commission a Registration
Statement covering the Registrable Securities for a selling stockholder resale
offering to be made on a continuous basis pursuant to Rule 415.  The
Registration Statement shall be on Form S-3 (except if the Company is not then
eligible to register for resale the Registrable Securities on Form S-3, in which
case such registration shall be on another appropriate form in accordance
herewith).  The Company shall use its commercially reasonable efforts to cause
the

 

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registration statement to be declared effective under the Securities Act as
promptly as possible after the filing thereof and to remain effective
continuously until all registered shares have been sold.  The Company shall
promptly notify the Holders via facsimile or electronic mail of a “.pdf” format
data file of the effectiveness of the registration statement within one business
day thereof. The Company shall, by 9:30 a.m. New York City time on the first
business day after the effective date, file a final Prospectus with the
Commission, as required by Rule 424(b) of the Securities Act.  Notwithstanding
the registration obligations set forth in this Section 2, in the event the
Commission informs the Company that all of the Registrable Securities cannot, as
a result of the application of Rule 415, be registered for resale on a single
registration statement, the Company agrees to promptly (i) inform each of the
Holders thereof, (ii) use its best efforts to file amendments to the
Registration Statement as required by the Commission and/or (iii) withdraw the
registration statement and file a new registration statement (a “New
Registration Statement”), in either case covering the maximum number of such
Registrable Securities permitted to be registered by the Commission, on Form S-3
or such other form available to register for resale such Registrable Securities
as a secondary offering; provided, however, that prior to filing such amendment
or New Registration Statement, the Company shall be obligated to use its
commercially reasonable efforts to advocate with the Commission for the
registration of all of the Registrable Securities in accordance with the SEC
Guidance, including without limitation, the Manual of Publicly Available
Telephone Interpretations D.29. In the event the Company amends the initial
Registration Statement or files a New Registration Statement, as the case may
be, under clauses (ii) or (iii) above, the Company will use its commercially
reasonable efforts to file with the Commission, as promptly as allowed by
Commission or SEC Guidance provided to the Company or to registrants of
securities in general, one or more registration statements on Form S-3 or such
other form available to register for resale those Registrable Securities that
were not registered for resale on the Registration Statement, as amended, or the
New Registration Statement (the “Remainder Registration Statements”).

 

(b)  Within three (3) business days of the effective date of a Registration
Statement under this Section 2, the Company shall cause its counsel to issue a
blanket opinion to the transfer agent stating that the Registrable Securities
are subject to an effective registration statement and can be reissued free of
restrictive legend upon notice of a sale by a Holder and confirmation by the
Holder that it has complied with the prospectus delivery requirements, provided
that the Company has not advised the transfer agent orally or in writing that
the opinion has been withdrawn. Copies of the blanket opinion required by this
Section 2 shall be delivered to the Holders promptly following delivery to the
transfer agent.

 

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(c)  Neither the Company nor any of its security holders (other than the Holders
in such capacity pursuant hereto) may include securities of the Company in any
Registration Statement under this Section 2 other than the Registrable
Securities, and the Company shall not after the date hereof enter into any
agreement providing any such right for inclusion of shares in the Registration
Statement to any of its security holders.

 

2.                                      Miscellaneous.

 

a.                                      No Other Amendment. Except as expressly
amended in this Amendment, all provisions of the Agreement shall remain in full
force and effect, and the parties thereto and hereto shall continue to have all
their rights and remedies under the Agreement. In the event of a conflict
between the terms and provisions of this Amendment and the terms and provisions
of the Agreement, the provisions of this Amendment shall govern.

 

b.                                      Relation to Agreement. This Amendment
constitutes an integral part of the Agreement. Capitalized terms not otherwise
defined herein shall have the respective meanings given them in the Agreement.
Upon the effectiveness of this Amendment, each reference in the Agreement to
“this Agreement,” “hereunder,” “hereof,” or words of like import referring to
the Agreement, shall mean and be a reference to the Agreement, as amended
hereby.

 

c.                                       Successors and Assigns. This Amendment
shall be binding on and shall inure to the benefit of the parties hereto and
their respective successors and assigns except as otherwise provided herein.

 

d.                                      Counterparts. This Amendment may be
executed by the parties hereto on any number of separate counterparts, any of
which may be executed and transmitted by facsimile, and each of which shall be
deemed an original and all of which, taken together, shall be deemed to
constitute one and the same instrument.

 

e.                                       Governing Law. This Amendment shall be
governed by, and construed in accordance with, the laws of the State of
Delaware, without regard to its principles of conflicts of law.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed
and delivered as of the date first above written.

 

 

 

PROSPECT GLOBAL RESOURCES, INC.,

 

a Nevada corporation

 

 

 

 

 

By:

/s/ Damon Barber

 

Name: Damon Barber

 

Title: President, CEO, and Secretary

 

 

 

 

 

THE KARLSSON GROUP, INC.,

 

an Arizona corporation

 

 

 

 

 

By:

/s/ Michael Stone

 

Name: Michael Stone

 

Title: CFO/Treasurer

 

[Signature Page to Amendment to Registration Rights Agreement]

 

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