Exhibit 10.2

 

REGISTRATION RIGHTS AGREEMENT

 

This REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of January 15,
2013, is made and entered into by and between Far East Energy Corporation, a
Nevada corporation (the “Company”), and the investors set forth on the signature
pages hereto (the “Investors”).

 

Recitals

 

A.         The Company and Far East Energy (Bermuda), Ltd., a wholly-owned
subsidiary of the Company (“FEEB”), have entered into a Securities Purchase
Agreement with the Investors, dated January 14, 2013 (the “Securities Purchase
Agreement”), pursuant to which the Investors purchased US$60,000,000 aggregate
principal amount of Senior Secured Notes due 2016 of FEEB (the “Notes”) and
Warrants (the “Warrants”), each warrant initially entitled the holder thereof to
purchase one share of common stock, par value $0.001 per share (the “Company
Common Stock”), of the Company, subject to adjustment. For purposes of this
Agreement, the “Registrable Securities” shall be the shares of Company Common
Stock or other securities issuable upon exercise of the Warrants.

 

B.          Pursuant to the terms of the Securities Purchase Agreement, the
Company has agreed to provide the Investors with certain registration rights
with respect to the Registrable Securities (as defined below).

 

Agreement

 

The parties, intending to be legally bound, hereby agree as follows:

 

ARTICLE 1

REGISTRATION RIGHTS AND PROCEDURES

 

1.1      Filing of Primary Registration Statement. Subject to the terms and
conditions of this Agreement, the Company shall prepare a Primary Registration
Statement on Form S-1, or Form S-3 if the Company is eligible to use such form
(the “Primary Registration Statement”), with respect to resales of the
Registrable Securities (as defined below) and shall file the Primary
Registration Statement with the Securities and Exchange Commission (the “SEC”)
within 210 days after the Closing Date (as defined in the Securities Purchase
Agreement).

 

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1.2      Effectiveness of Primary Registration Statement. The Company shall use
its best efforts to (a) have the Primary Registration Statement declared
effective by the SEC within 360 days after the Closing Date (or within 390 days
after the Closing Date if the Primary Registration Statement is subject to
review and comment by the SEC), (b) subject to Section 1.4, prepare and file
with the SEC such amendments and supplements to the Primary Registration
Statement and the prospectus used in connection therewith as may be necessary to
comply with the provisions of the Securities Act, and rules thereunder with
respect to the disposition of all securities covered by such Primary
Registration Statement or to keep the Primary Registration Statement effective
with respect to any Registrable Securities, until the earlier of (i) the date on
which all Registrable Securities covered by the Primary Registration Statement
have been sold by the Investors, (ii) the date on which either all such
Registrable Securities are distributed to the public pursuant to Rule 144
promulgated by the SEC pursuant to the Securities Act (or any similar provision
then in effect), or are saleable pursuant to Rule 144 promulgated by the SEC
pursuant to the Securities Act, (iii) date that is one year after the expiration
date of the Warrants, or (iv) the date on which all Registrable Securities are
sold to the Company or one of its subsidiaries (but not before the expiration of
the applicable prospectus delivery requirements); and (c) comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by the Primary Registration Statement during such period in
accordance with the intended methods of disposition by the Investors as set
forth in the Primary Registration Statement. The Company shall further use its
best efforts to register and qualify the Registrable Securities covered by such
Primary Registration Statement under such other securities or “blue sky” laws of
such jurisdictions as shall be requested by the Investors.

 

1.3      Piggyback Registration Rights. Subject to the terms and conditions of
this Agreement, if the Company intends to file or desires to file a registration
statement on Form S-1, Form S-3 or another appropriate, similar, equivalent or
successor form under the Securities Act for the offering or resale of
Registrable Securities (other than as contemplated in Sections 1.1 and 1.2 above
and other than an offering registered solely on Form S-8 or Form S-4 or any
similar, equivalent, or successor forms, or any other form not available for
registering the Registrable Securities) (a “Piggyback Registration Statement”
and together with the Primary Registration Statement, the “Registration
Statements”), until the earlier of (i) the date on which all Registrable
Securities covered by the Primary Registration Statement have been sold by the
Investors, (ii) the date on which either all such Registrable Securities are
distributed to the public pursuant to Rule 144 promulgated by the SEC pursuant
to the Securities Act (or any similar provision then in effect), or are saleable
pursuant to Rule 144 promulgated by the SEC pursuant to the Securities Act,
(iii) date that is one year after the expiration date of the Warrants, or
(iv) the date on which all Registrable Securities are sold to the Company or one
of its subsidiaries (but not before the expiration of the applicable prospectus
delivery requirements), the Company will notify each holder of Registrable
Securities of the proposed filing at least 30 days prior to the filing of the
Piggyback Registration Statement, and will afford each holder of Registrable
Securities an opportunity to include in such Piggyback Registration Statement
all or any part of the Registrable Securities then held by such holder. Each
holder of Registrable Securities desiring to include in any such Piggyback
Registration Statement all or part of the Registrable Securities held by such
holder shall, within 20 days after receipt of the above-described notice from
the Company, so notify the Company in writing, and in such notice shall inform
the Company of the number of Registrable Securities such holder wishes to
include in such Piggyback Registration Statement, provided that if, at any time
after giving written notice of its intention to register any Registrable
Securities and prior to the effective date of the Piggyback Registration
Statement filed in connection with such registration, the Company shall
determine for any reason not to register or to delay registration of such
Registrable Securities, the Company shall give written notice of such
determination to the holders of the Registrable Securities and, thereupon, (i)
in the case of a determination not to register, shall be relieved of its
obligation to register any Registrable Securities in connection with such
registration (without prejudice), and (ii) in the case of a determination to
delay registering, shall be permitted to delay registering any Registrable
Securities for the same period as the delay in registering such other
Registrable Securities.

 

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1.4         Other Obligations.

 

(a)     At least ten (10) business days prior to the filing thereof with the
SEC, the Company shall furnish to the Investors a copy of the proposed form of
the applicable Registration Statement and each amendment thereto and each
supplement, if any, to the prospectus included therein, and shall afford the
Investors the opportunity to participate in the preparation of each such
document. The Company shall furnish to the Investors, without charge, such
number of copies of any Registration Statement, each amendment and supplement
thereto, the prospectus included in any Registration Statement (including each
preliminary prospectus), in each case in conformity with the requirements of the
Securities Act and the rules thereunder, and such other documents as the
Investors may request in order to facilitate the disposition of the Registrable
Securities owned by the Investors. The Company shall also make available for
inspection by a representative of the Investors, and attorneys, accountants,
agents or other professionals designated by the Investors, without charge, at
reasonable times and in a reasonable manner, financial and other records,
documents and properties of the Company that are pertinent to the conduct of due
diligence customary for an underwritten offering, and cause the officers,
directors and employees of the Company to supply all information requested by
such representatives, attorneys, accountants, agents or other professionals in
connection with any Registration Statement as shall be necessary to enable such
persons to conduct a reasonable investigation within the meaning of Section 11
of the Securities Act.

 

(b)     The Company shall promptly notify the Investors in writing (i) of the
happening of any event as a result of which the prospectus included in any
Registration Statement contains 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 light of the circumstances then
existing and shall use its best efforts to prepare and file with the SEC, and
promptly notify the Investors of the filing of, a supplement to such prospectus
or an amendment to any Registration Statement so that, as thereafter delivered
to the purchasers of Registrable Securities, such 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 not misleading
in light of the circumstances under which they were made and in the case of an
amendment to any Registration Statement, use commercially reasonable efforts to
cause it to become effective as soon as possible, (ii) of any request by the SEC
or any state securities authority for amendments and supplements to any
Registration Statement or of any material request by the SEC or any state
securities authority for additional information after any Registration Statement
has become effective, (iii) of the issuance by the SEC or any state securities
authority of any stop order suspending the effectiveness of any Registration
Statement or of any order suspending or preventing the use of any related
prospectus or suspending the qualification of any securities included in any
Registration Statement pursuant to this Agreement for sale in any jurisdiction,
or the initiation of any proceedings for that purpose, (iv) if, between the
effective date of any Registration Statement and the closing of any sale of
Registrable Securities covered thereby, the representations and warranties of
the Company contained in any underwriting agreement, securities sales agreement
or other similar agreement, including this Agreement, relating to the disclosure
cease to be true and correct in all material respects as of date made or as
specified therein or if the Company receives any notification with respect to
the suspension of the qualification of the Registrable Securities for sale in
any jurisdiction or the initiation of any proceeding for that purpose and (v) of
any determination by the Company that a post-effective amendment to any
Registration Statement would be appropriate. Upon receipt of any notice from the
Company of the happening of any event of the kind described in (i), (iii) or (v)
above (the “Notice”), the Investors will forthwith use its commercially
reasonable efforts to discontinue disposition of Registrable Securities pursuant
to any Registration Statement until the Investors’ receipt of the copies of the
supplemented or amended prospectus, or until it is advised in writing by the
Company that the use of the prospectus or Registration Statement, as applicable,
may be resumed. The Company shall use its best efforts to ensure that the use of
the prospectus and/or Registration Statement, as amended or supplemented, may be
resumed by the Investors within 30 days of the date of the Notice.

 

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(c)     The Company reserves the right to suspend twice during any 365 day
period for a reasonable period of time not to exceed 30 days for each suspension
(from the date notification of such suspension is sent to the Investors) (except
for any period of more than 30 consecutive days or during the 30 days
immediately prior to the expiration of the Warrants), the use or effectiveness
of any Registration Statement if the Company’s Board of Directors in good faith
determines that (i) such registration might have a material adverse effect on
any of the Company’s plans or proposals with respect to any financing,
acquisition, recapitalization, reorganization, or other material transaction, or
(ii) the Company is in possession of material non-public information that, if
publicly disclosed, could result in a material disruption of a major corporate
development or transaction then pending or in progress or in other material
adverse consequences to the Company.

 

(d)      The Company shall enter into and perform its obligations under such
customary agreements (including, in the event of any underwritten or agented
offering, an underwriting or agency agreement with the managing underwriter or
underwriters of or agents for such offering (including customary indemnification
and contribution obligations of underwriters or agents)), in usual and customary
form and take all such other action, if any, as the Investors shall request in
order to facilitate the disposition of Registrable Securities pursuant to the
applicable Registration Statement in an underwritten offering or otherwise. The
Company shall also cooperate with the Investors and the underwriters’
representative or agent for such offering in the marketing of the Registrable
Securities, including making available the Company’s officers, accountants,
counsel, premises, books and records for such purpose and including using its
best efforts to obtain a so-called “comfort letter” from its independent public
accountants, and legal opinions and 10b-5 letters of counsel to the Company
addressed to the underwriters, in customary form and covering such matters of
the type customarily covered by such letters, and in a form that shall be
reasonably satisfactory to the underwriters.

 

(e)      The Company shall use its best efforts to obtain a so-called “comfort
letter” from its independent public accountants, and legal opinions and 10b-5
letters of counsel to the Company addressed to the Investors, in customary form
and covering such matters of the type customarily covered by such letters, and
in a form that shall be reasonably satisfactory to the Investors. The Company
shall furnish to the Investors a signed counterpart of any such comfort letter
or legal opinion. Delivery of any such opinion or comfort letter shall be
subject to the recipient furnishing such written representations, opinions or
acknowledgements as are customarily provided by selling shareholders who receive
such comfort letters or opinions, including without limitation that such
Investor has a statutory due diligence defense under Section 11 of the
Securities Act.

 

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(f)      The Company shall provide a transfer agent and registrar for all
Registrable Securities registered pursuant hereunder and a CUSIP number for all
such Registrable Securities, in each case not later than the effective date of
such registration.

 

(g)      The Company shall take such other actions as are required in order to
expedite or facilitate the disposition of Registrable Securities included in
each such registration, including cooperating with the Investors and its counsel
to facilitate the timely preparation and delivery of certificates to be sold
pursuant to the applicable Registration Statement free of any restrictive
legends and in such denomination and registered in such name as the Holder may
request within a reasonable period of time prior to sales of the applicable
Registrable Securities pursuant to such Registration Statement.

 

(h)          The Company shall use its reasonable best efforts to cause all
Registrable Securities sold under any Registration Statement to be listed on any
securities exchange or any automated quotation system on which similar
securities issued by the Company are then listed if requested by the Investors.

 

1.5          Nature of Sale. Notwithstanding any other provision of this
Agreement, shares of Company Common Stock or other securities issuable upon
exercise of the Warrants shall be treated as Registrable Securities only if and
so long as it has not been (a) sold to or through a broker or dealer or
underwriter in a public distribution or a public securities transaction, or
(b) sold in a transaction exempt from the registration and prospectus delivery
requirements of the Securities Act under Section 4(1) thereof (and any rules and
regulations promulgated thereunder) so that all transfer restrictions, and
restrictive legends with respect thereto, if any, are removed upon the
consummation of such sale.

 

1.6          Reports Under the Exchange Act. With a view to making available to
the Investors the benefits of Rule 144 of the Securities Act and any other rule
or regulation of the SEC that may at any time permit the Investors to sell
Registrable Securities to the public without registration or pursuant to a
registration on Form S-3, the Company shall:

 

(a)      make and keep available adequate current public information, as those
terms are understood and defined in Rule 144 under the Securities Act, at all
times following the Closing Date so long as the Company is subject to the
reporting requirements of the Securities Exchange Act of 1934, as amended
(“Exchange Act”);

 

(b)      file with or submit to, as applicable, the SEC in a timely manner all
reports and other documents required to be filed or submitted by the Company
under the Securities Act and the Exchange Act (at all times it is subject to
such reporting requirements); and

 

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(c)      furnish to the Investors, so long as the Investors owns any Registrable
Securities, forthwith upon request (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144 of the Securities
Act, the Securities Act, and the Exchange Act (so long as the Company is subject
to the reporting requirements of the Exchange Act), or that it qualifies as a
registrant whose securities may be resold pursuant to Form S-3 (at any time the
Company so qualifies); (ii) a copy of the most recent annual or quarterly report
of the Company and such other reports and documents so filed by the Company; and
(iii) such other information as may be requested in availing the Investors of
any rule or regulation of the SEC that permits the selling of any such
securities without registration or pursuant to Form S-3 (at any time the Company
so qualifies to use such form).

 

1.7          Accuracy of Disclosure. The Company (and its successors) represents
and warrants to the Investors and agrees for the benefit of the Investors that
from and after the effective date of a Registration Statement, except during any
period in which the availability of any Registration Statement has been
suspended and for which notice has been provided to the Investors, (i) each
Registration Statement together with the documents incorporated by reference
therein will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make such statements therein not misleading;
and (ii) the prospectus delivered to such Investors pursuant to which the
Investors sells its Registrable Securities, together with the documents
incorporated by reference therein, will not contain any untrue statement of a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.

 

1.8          No Inconsistent Agreements. The Company represents and warrants
that it has not entered into, and agrees that on or after the date of this
Agreement it will not enter into, any agreement which is inconsistent with the
rights granted to the Investors in this agreement or otherwise conflicts with
the provisions hereof. The Company represents that the rights granted to the
Investors hereunder do not in any way conflict with and are not inconsistent
with the rights granted to the holders of the Company’s other issued and
outstanding securities under any agreements.

 

1.9          Expenses. The Company shall bear all fees and expenses incurred in
connection with the performance of its obligations under Section 1 hereof,
whether or not any Registration Statement is filed or becomes effective, and,
other than with respect to underwriting discounts and broker fees and
commissions, shall bear or reimburse the Investors for its out-of-pocket
expenses (including fees and disbursements of one firm of counsel designated by
the Investors) incurred in connection with the preparation of such Registration
Statement.

 

ARTICLE 2

RIGHTS AND UNDERTAKINGS OF

THE INVESTORS

 

2.1          Rights of Investors. The Investors shall have the absolute right to
exercise or refrain from exercising any right or rights that it may have by
reason of this Agreement, including, without limitation, the right to consent to
the waiver or modification of any obligation under this Agreement.

 

2.2          Suspension of Sales; Notice of Sales. If any Registrable Securities
are included in a Registration Statement pursuant to the terms of this
Agreement, the Investors thereof will not (until further notice) effect sales
thereof after receipt of written notice from the Company of the occurrence of an
event specified in order to permit the Company to correct or update such
Registration Statement or prospectus. The Company shall use its best efforts to
correct or update such Registration Statement or prospectus within thirty (30)
days of the date of such notice. The Investors shall use its commercially
reasonable efforts to notify the Company of the sale of any Registrable
Securities within a reasonable period of time.

 

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2.3          Compliance. If any Registrable Securities are being registered in
any registration pursuant to this Agreement, the Investors will comply with all
anti-stabilization, manipulation, and similar provisions of Section 10 of the
Exchange Act, and any rules promulgated thereunder by the SEC and, at the
Company’s request, will execute and deliver to the Company and to any
underwriter participating in such offering an appropriate agreement to such
effect.

 

2.4          Termination of Effectiveness. Following the end of the period
during which the Company is obligated to keep any Registration Statement current
and effective as described herein and following notice to the Investors of the
end of such period, the Investors shall discontinue sales thereof pursuant to
such Registration Statement, unless the Investors has received written notice
from the Company of its intention to continue the effectiveness of such
Registration Statement with respect to any of such securities which remain
unsold.

 

2.5          Furnish Information. It shall be a condition precedent to the
Company’s obligations to take any action pursuant to this Agreement with respect
to the Investors’s Registrable Securities that, upon written request from the
Company, the Investors shall timely furnish to the Company such information
regarding itself, the Registrable Securities held by it, and the intended method
of disposition of such securities as shall be required to effect the
registration of the Investors’s Registrable Securities and as the Company shall
otherwise reasonably request in connection with Investors’s status as a selling
stockholder. The Investors shall not be entitled to be named as a selling
shareholder in such Registration Statement and the Investors shall not be
entitled to use the prospectus forming a part thereof if the Investors does not
so provide such information to the Company in a timely manner.

 

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ARTICLE 3

INDEMNIFICATION

 

3.1          Indemnification by the Company. The Company shall indemnify and
hold harmless, with respect to any Registration Statement filed by it pursuant
to this Agreement, to the fullest extent permitted by law, the Investors, as
well as the Investors’s officers, directors, employees, agents, and each other
person, if any, who controls the Investors within the meaning of the Securities
Act and the officers, directors, employees and agents of such controlling person
(collectively, the “Holder Indemnified Parties”) against all losses, claims,
damages, liabilities, and expenses joint or several (including reasonable fees
of counsel and any amounts paid in settlement effected with the Company’s
consent, which consent shall not be unreasonably withheld) (collectively,
“Losses”) to which any such Holder Indemnified Party may become subject under
the Securities Act, the Exchange Act, any other federal law, any state or common
law, any rule or regulation promulgated thereunder, or otherwise, insofar as
such Losses (or actions or proceedings, whether commenced or threatened, in
respect thereof) are caused by (a) any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement or
amendment or supplement thereto in which such Registrable Securities were
included as contemplated hereby or 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, (b) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary, final, or summary
prospectus or amendment or supplement thereto, together with the documents
incorporated by reference therein (as amended or supplemented if the Company
shall have filed with the SEC any amendment thereof or supplement thereto), or
the omission to state therein 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, or (c) any violation
by the Company of the Securities Act, the Exchange Act, any state securities
law, or any rule or regulation promulgated under the Securities Act, the
Exchange Act or any state securities laws in connection with any such
registration; provided, however, that the Company shall not be liable to any
such Holder Indemnified Party in any such case to the extent that any such Loss
(or action or proceeding, whether commenced or threatened, in respect thereof)
arises out of or is based upon any untrue statement or alleged untrue statement
or omission or alleged omission made in such Registration Statement or amendment
thereof or supplement thereto or in any such preliminary, final, or summary
prospectus in reliance upon and in conformity with written information furnished
to the Company by or on behalf of any such Holder Indemnified Party relating to
such Holder Indemnified Party expressly for inclusion in any Registration
Statement; and provided further, that the Company shall not be liable to any
such Holder Indemnified Party with respect to any preliminary prospectus to the
extent that any such Loss of such Holder Indemnified Party results from the fact
that such Holder Indemnified Party sold Registrable Securities to a person to
whom there was not timely sent or given a copy of the prospectus (excluding
documents incorporated by reference) or of the prospectus as then amended or
supplemented (excluding documents incorporated by reference) if the Company
previously furnished copies thereof to such Holder Indemnified Party and the
Holder Indemnified Party had received written notice from the Company that the
use of such prospectus, amendment or supplement was suspended in compliance with
this Agreement and the Loss of such Holder Indemnified Party results from an
untrue statement or omission of a material fact contained in such preliminary
prospectus which was corrected in the prospectus (or the prospectus as amended
or supplemented). Such indemnity and reimbursement of expenses and obligations
shall remain in full force and effect regardless of any investigation made by or
on behalf of the Holder Indemnified Parties and shall survive the transfer of
such securities by such Holder Indemnified Parties.

 

3.2          Conduct of Indemnification Proceedings. Promptly after receipt by
an indemnified party hereunder of written notice of the commencement of any
action, suit, proceeding, investigation, or threat thereof with respect to which
a claim for indemnification may be made pursuant hereto, such indemnified party
shall, if a claim in respect thereto is to be made against an indemnifying
party, give written notice to the indemnifying party of the threat or
commencement thereof; provided, however, that the failure to so notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party except to the extent that the indemnifying party is
actually prejudiced by such failure to give notice. If any such claim or action
referred to hereunder is brought against any indemnified party and it then
notifies the indemnifying party of the threat or commencement thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other indemnifying party similarly notified, to
assume the defense thereof with counsel reasonably satisfactory to such
indemnified party (which counsel shall not, except with the consent of the
indemnified party, be counsel to the indemnifying party). The indemnifying party
shall not be liable to an indemnified party hereunder for any legal expenses of
counsel or any other expenses incurred by such indemnified party in connection
with the defense thereof, unless the indemnifying party has failed to assume the
defense of such claim or action or to employ counsel reasonably satisfactory to
such indemnified party. Notwithstanding the foregoing, the indemnified party
shall have the right to retain its own counsel, with the fees and expenses to be
paid by the indemnified party, if representation of such indemnified party by
the counsel retained by the indemnifying party would be inappropriate due to
actual or potential differing interests between such indemnified party and any
other party represented by such counsel in such action. The indemnifying party
shall not be required to indemnify the indemnified party with respect to any
amounts paid in settlement of any action, proceeding, or investigation entered
into without the written consent of the indemnifying party, which consent shall
not be unreasonably withheld. No indemnifying party shall consent to the entry
of any judgment or enter into any settlement without the consent of the
indemnified party unless (a) such judgment or settlement does not impose any
obligation or liability upon the indemnified party other than the execution,
delivery, or approval thereof, and (b) such judgment or settlement includes as
an unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a full release and discharge from all liability in respect
of such claim and a full release of all persons that may be entitled to or
obligated to provide indemnification or contribution under this Article.

 

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3.3          Contribution. If the indemnification provided for herein is
unavailable to or insufficient to hold harmless an indemnified party hereunder,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of the Losses (or actions or proceedings in
respect thereof) referred to herein in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand and the
indemnified party on the other in connection with the statements, omissions,
actions, or inactions which resulted in such Losses. The relative fault of the
indemnifying party and the indemnified party shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the indemnifying party or the indemnified
party, any action or inaction by any such party, and the parties’ relative
intent, knowledge, access to information, and opportunity to correct or prevent
such statement, omission, action, or inaction. 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. Promptly after receipt by an indemnified party
hereunder of written notice of the commencement of any action, suit, proceeding,
investigation, or threat thereof with respect to which a claim for contribution
may be made against an indemnifying party hereunder, such indemnified party
shall, if a claim for contribution in respect thereto is to be made against an
indemnifying party, give written notice to the indemnifying party of the
commencement thereof (if the notice specified herein has not been given with
respect to such action); provided, however, that the failure to so notify the
indemnifying party shall not relieve it from any obligation to provide
contribution which it may have to any indemnified party hereunder, except to the
extent that the indemnifying party is actually prejudiced by the failure to give
notice. The parties hereto agree that it would not be just and equitable if
contribution pursuant hereto were determined by pro rata allocation or by any
other method of allocation which does not take account of equitable
considerations referred to herein.

 

If indemnification is available hereunder, the indemnifying parties shall
indemnify each indemnified party to the fullest extent provided herein, without
regard to the relative fault of said indemnifying party or indemnified party or
any other equitable consideration provided for herein. The provisions hereof
shall be in addition to any other rights to indemnification or contribution
which any indemnified party may have pursuant to law or contract, shall remain
in full force and effect regardless of any investigation made by or on behalf of
any indemnified party, and shall survive the transfer of securities by any such
party.

 

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ARTICLE 4

MISCELLANEOUS

 

4.1          Termination. The obligations under Article 1 shall terminate on the
date on which all Registrable Securities covered by the Registration Statements
have been sold.

 

4.2          Assignment; Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties and their respective successors and
permitted assigns, including, without limitation, subsequent holders of any
Registrable Securities. Neither party may assign this Agreement or any of its
rights or obligations hereunder without the prior written consent of the other
party; provided, however, that the Investors may assign this Agreement to any
person that, directly or indirectly, through one or more intermediaries controls
or is under common control with the Investors, as such terms are construed under
Rule 144 promulgated under the Securities Act, provided that (a) the Company is
furnished with written notice of the name and address of the assignee and the
securities with respect to which such rights are being assigned, and (b) the
Company shall have the right to require any holder of any Registrable Securities
to execute a counterpart of this Agreement as a condition to such holder’s claim
to any rights hereunder; and provided, however, that if any subsequent holder
shall acquire any Registrable Securities or Warrants in any manner, whether by
operation of law or otherwise, such Registrable Securities or Warrants shall be
held subject to all of the terms of this Agreement and by taking and holding
such Registrable Securities or Warrants such person shall be conclusively deemed
to have agreed to be bound by and to perform all of the terms and provisions of
this Agreement and such person shall be entitled to receive the benefits hereof.

 

4.3          Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective on the earliest of (a) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile number
specified in this section prior to 5:00 p.m. (Central Time) on a business day,
(b) the next business day after the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number specified in
this Section on a day that is not a business day or later than 5:00 p.m.
(Central Time) on any date and earlier than 11:59 p.m. (Central Time) on such
date, (c) the business day following the date of mailing, if sent by U.S.
nationally recognized overnight courier service, or (d) upon actual receipt by
the party to which such notice is required to be given. The addresses for such
notices and communications shall be as follows:

 

If to the Company:           Far East Energy Corporation

363 N. Sam Houston Parkway East

Suite 380

Houston, Texas 77060s

USA

Fax: +1-832-598-0479

Attention: Chief Executive Officer

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with a copy to:                  Baker & McKenzie LLP

2300 Trammell Crow Center

2001 Ross Avenue

Dallas, Texas 75201

USA

Fax: +1-214-978-3099

Attention: Amar Budarapu, Esq.

 

If to Investors, to the addresses and facsimile numbers set forth below the
Investor’s signature on the signature page of this Agreement.

 

or such other address as may be designated in writing hereafter, in the same
manner, by such person.

 

4.4          Governing Law; Jurisdiction. THE LAW OF THE STATE OF NEW YORK SHALL
GOVERN AND BE USED TO CONSTRUE THIS AGREEMENT. Any suit, action or proceeding
against any of the Company or the Investors or its or their respective
properties, assets or revenues with respect to this Agreement (a “Related
Proceeding”) may be brought in any court of the State of New York or any United
States federal court sitting in the Borough of Manhattan, The City of New York,
New York, United States, and any appellate court from any thereof, as the person
bringing such Related Proceeding may elect in its sole discretion. Each of the
Company and the Investors hereby consents to the non-exclusive jurisdiction of
each such court for the purpose of any Related Proceeding and has irrevocably
waived any objection to the laying of venue of any Related Proceeding brought in
any such court and to the fullest extent it may effectively do so and the
defense of an inconvenient forum to the maintenance of any Related Proceeding or
any such suit, action or proceeding in any such court. Each of the Company and
the Investors has agreed that service of all writs, claims, process and
summonses in any Related Proceeding brought against it in the State of New York
may be made upon it at the address for notices set forth in Section 4.3 of this
Agreement. Nothing in this Agreement shall in any way be deemed to limit the
ability to serve any such writs, process or summonses in any other manner
permitted by applicable law. To the extent that any of the Company or any
Investor has or hereafter may acquire any immunity from jurisdiction of any
court or from any legal process (whether through service of notice, attachment
prior to judgment, attachment in aid of execution or execution, on the ground of
sovereignty or otherwise) with respect to itself or its property, it hereby
irrevocably waives, to the fullest extent permitted by applicable law, such
immunity in respect of its obligations under this Agreement. EACH OF THE COMPANY
AND THE INVESTORS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

 

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4.5          Third-Party Beneficiaries. This Agreement is intended for the
benefit of the Parties and their respective successors and permitted assigns and
is not for the benefit of, nor may any provision hereof be enforced by, any
other person.

 

4.6          Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any law or public policy, all
other terms and provisions of this Agreement shall nevertheless remain in full
force and effect for so long as the economic or legal substance of the Agreement
is not affected in any manner materially adverse to any party. Upon such
determination that any term or other provision is invalid, illegal or incapable
of being enforced, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner in order that the Agreement is consummated as
originally contemplated to the greatest extent possible.

 

4.7          Headings. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the Company and Investors to express their mutual
intent, and no rules of strict construction will be applied against either the
Company or Investors. This Agreement shall be construed as if drafted jointly by
the Company and Investors, and no presumption or burden of proof shall arise
favoring or disfavoring either the Company or Investors by virtue of the
authorship of any provisions of the Agreement.

 

4.8          Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original instrument and all
of which together shall constitute one and the same instrument and shall become
effective when counterparts have been signed by each party and delivered to the
other parties, it being understood that all parties need not sign the same
counterpart. In the event that any signature is delivered by facsimile
transmission or by electronic mail in Portable Document Format, such signature
shall create a valid and binding obligation of the person executing (or on whose
behalf such signature is executed) with the same force and effect as if such
facsimile signature page were an original thereof.

 

4.9          Entire Agreement. This Agreement embodies the entire understanding
and agreement between the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements and understandings relating to the
subject matter hereof.

 

4.10          Amendment; Waiver. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to or departures from the provisions hereof may not be
given, without the written consent of the Company and Investors.

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4.11          Further Assurances. Each party shall cooperate and take such
action as may be reasonably requested by another party in order to carry out the
provisions and purposes of this Agreement and the transactions contemplated
hereby.

 

4.12          Limited Recourse. To the extent that this Agreement is executed by
a custodian or agent for any Investor, it is acknowledged that such custodian or
agent is executing this Agreement in its capacity as custodian or agent and not
in its own capacity and agreed that all obligations of an Investor contemplated
by this Agreement are limited to such Investor and its assets.

 

[Signature pageS follow]

 

13

 

 

Each of the parties below hereby executes and delivers, and agrees to be bound
by, the Registration Rights Agreement by and among Far East Energy Corporation
and the Investor party thereto as of the date hereof.

 

SIGNED for and on behalf of

NORTHERN TRUST (GUERNSEY) LIMITED

AS CUSTODIAN AND AGENT FOR

ASSET HOLDER PCC LIMITED IN RESPECT OF

ASHMORE EMERGING MARKETS LIQUID

INVESTMENT PORTFOLIO

 

By: /s/ Sarah Brouard   Name: Sarah Brouard   Title: Authorized Person       By:
/s/ George Spalding   Name: George Spalding   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST COMPANY, LONDON BRANCH

AS CUSTODIAN AND AGENT FOR

ASHMORE EMERGING MARKETS DEBT FUND

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST (GUERNSEY) LIMITED

AS CUSTODIAN AND AGENT FOR

ASHMORE EMERGING MARKETS DEBT AND

CURRENCY FUND LIMITED

 

By: /s/ Sarah Brouard   Name: Sarah Brouard   Title: Authorized Person       By:
/s/ George Spalding   Name: George Spalding   Title: Authorized Person  

 

14

 

 

SIGNED for and on behalf of

NORTHERN TRUST COMPANY, LONDON BRANCH

AS CUSTODIAN AND AGENT FOR

ASHMORE FUNDS, A MASSACHUSETTS

BUSINESS TRUST, ON BEHALF OF ASHMORE

EMERGING MARKETS TOTAL RETURN FUND

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST GLOBAL SERVICES

LIMITED, LUXEMBOURG BRANCH

AS CUSTODIAN AND AGENT FOR

ASHMORE SICAV IN RESPECT OF

ASHMORE SICAV EMERGING MARKETS

TOTAL RETURN FUND

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST GLOBAL SERVICES

LIMITED, LUXEMBOURG BRANCH

AS CUSTODIAN AND AGENT FOR

ASHMORE SICAV IN RESPECT OF

ASHMORE SICAV EMERGING MARKETS

TOTAL RETURN FUND II

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST COMPANY, LONDON

BRANCH AS CUSTODIAN AND AGENT FOR

STICHTING PENSIOENFONDS

VAN DE METALEKTRO

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

15

 

 

 

SIGNED for and on behalf of

NORTHERN TRUST GLOBAL SERVICES

LIMITED, LUXEMBOURG BRANCH

AS CUSTODIAN AND AGENT FOR

ASHMORE SICAV EMERGING MARKETS

DEBT FUND

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

ASHMORE INVESTMENT MANAGEMENT

LIMITED

AS PORTFOLIO MANAGER FOR

GLOBAL HIGH YIELD, A SUB-FUND OF

MEDIOLANUM BEST BRANDS

 

By: /s/ Illegible   Name:     Title:    

 

SIGNED for and on behalf of

NORTHERN TRUST (GUERNSEY) LIMITED

AS CUSTODIAN AND AGENT FOR

ASHMORE GROWING MULTI-STRATEGY

FUND LIMITED

 

By: /s/ Sarah Brouard   Name: Sarah Brouard   Title: Authorized Person       By:
/s/ George Spalding   Name: George Spalding   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST (GUERNSEY) LIMITED

AS CUSTODIAN AND AGENT FOR ASHMORE

EMERGING MARKETS CORPORATE HIGH

YIELD FUND LIMITED

 

By: /s/ Sarah Brouard   Name: Sarah Brouard   Title: Authorized Person       By:
/s/ George Spalding   Name: George Spalding   Title: Authorized Person  

 

16

 

 

SIGNED for and on behalf of

NORTHERN TRUST GLOBAL SERVICES

LIMITED, LUXEMBOURG BRANCH

AS CUSTODIAN AND AGENT FOR

ASHMORE SICAV IN RESPECT OF ASHMORE

SICAV EMERGING MARKETS CORPORATE DEBT FUND

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST COMPANY,

LONDON BRANCH

AS CUSTODIAN AND AGENT FOR

ASHMORE FUNDS, A MASSACHUSETTS BUSINESS

TRUST, ON BEHALF OF ASHMORE EMERGING

MARKETS CORPORATE DEBT FUND

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST GLOBAL SERVICES

LIMITED, LUXEMBOURG BRANCH

AS CUSTODIAN AND AGENT FOR

ASHMORE SICAV IN RESPECT OF ASHMORE

SICAV EMERGING MARKETS ASIAN

CORPORATE DEBT FUND

 

By: /s/ Russell Alder   Name: Russell Alder   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST (GUERNSEY) LIMITED

AS CUSTODIAN AND AGENT FOR ASHMORE

EMERGING MARKETS TRI ASSET FUND LIMITED

 

By: /s/ Sarah Brouard   Name: Sarah Brouard   Title: Authorized Person       By:
/s/ George Spalding   Name: George Spalding   Title: Authorized Person  

 

SIGNED for and on behalf of

NORTHERN TRUST (GUERNSEY) LIMITED

AS CUSTODIAN AND AGENT FOR ASHMORE

EMERGING MARKETS HIGH YIELD PLUS

FUND LIMITED

 

By: /s/ Sarah Brouard   Name: Sarah Brouard   Title: Authorized Person       By:
/s/ George Spalding   Name: George Spalding   Title: Authorized Person  

 

17

 

 

SIGNED for and on behalf of
NORTHERN TRUST (GUERNSEY) LIMITED
AS CUSTODIAN AND AGENT FOR
ASHMORE GLOBAL SPECIAL SITUATIONS
FUND 5 LIMITED PARTNERSHIP

 

By: /s/ Sarah Brouard   Name: Sarah Brouard   Title: Authorized Person       By:
/s/ George Spalding   Name: George Spalding   Title: Authorized Person  

 

18

 

 

This Agreement is hereby confirmed and accepted by Far East Energy Corporation
as of January15, 2013.

 

  FAR EAST ENERGY CORPORATION       By: /s/ Michael R. McElwrath   Name: Michael
R. McElwrath   Title: Chief Executive Officer and President

 

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