Exhibit 4.2

 

Execution Copy

 

REGISTRATION RIGHTS AGREEMENT

 

by and among

 

Harvest Operations Corp.

 

and

 

the Guarantors listed on Schedule A hereto

 

and

 

Banc of America Securities LLC
 HSBC Securities (USA) Inc.
 CIBC World Markets Corp.
 Mitsubishi UFJ Securities (USA), Inc.
 NBF Securities (USA) Corp.
 Scotia Capital (USA) Inc.
 TD Securities (USA) LLC

 

Dated as of October 4, 2010

 











 

REGISTRATION RIGHTS AGREEMENT

 

This Registration Rights Agreement (this “Agreement”) is made and entered into as of October 4, 2010, by and among Harvest Operations Corp., an Alberta corporation (the “Company”), the Guarantors named on Schedule A hereto (the “Guarantors”), and Banc of America Securities LLC, HSBC Securities (USA) Inc., CIBC World Markets Corp., Mitsubishi UFJ Securities (USA), Inc., NBF Securities (USA) Corp., Scotia Capital (USA) Inc. and TD Securities (USA) LLC (collectively, the “Initial Purchasers”), each of whom has agreed to purchase the Company’s 6 7/8% Senior Notes due 2017 (the “Initial Notes”) fully and unconditionally guaranteed by the Guarantors (the “Guarantees”) pursuant to the Purchase Agreement (as defined below). The Initial Notes and the Guarantees are herein collectively referred to as the “Initial Securities.”

 

This Agreement is made pursuant to the Purchase Agreement, dated as of September 24, 2010 (the “Purchase Agreement”), among the Company, the Guarantors and the Initial Purchasers (i) for the benefit of the Initial Purchasers and (ii) for the benefit of the holders from time to time of the Initial Securities, including the Initial Purchasers. In order to induce the Initial Purchasers to purchase the Initial Securities, the Company has agreed to provide the registration rights set forth in this Agreement. The execution and delivery of this Agreement is a condition to the obligations of the Initial Purchasers set forth in Section 5(h) of the Purchase Agreement.

 

The parties hereby agree as follows:

 

SECTION 1.           Definitions. As used in this Agreement, the following capitalized terms shall have the following meanings:

 

Additional Interest: As defined in Section 4 hereof.

 

Broker-Dealer: Any broker or dealer registered under the Exchange Act.

 

Business Day: Any day other than a Saturday, Sunday or U.S. federal holiday or a day on which banking institutions or trust companies located in New York, New York are authorized or obligated to be closed.

 

Commission: The Securities and Exchange Commission.

 

Consummate: A registered Exchange Offer shall be deemed “Consummated” for purposes of this Agreement upon the occurrence of (i) the filing and effectiveness under the Securities Act of the Exchange Offer Registration Statement relating to the Exchange Securities to be issued in the Exchange Offer, (ii) the maintenance of such Registration Statement continuously effective and the keeping of the Exchange Offer open for a period not less than the minimum period required pursuant to Section 2(b) hereof, and (iii) the delivery by the Company to the Registrar under the Indenture of Exchange Securities in the same aggregate principal amount as the aggregate principal amount of Initial Securities that were tendered by Holders thereof pursuant to the Exchange Offer.

 

Effectiveness Target Date: As defined in Section 4 hereof.

 

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Exchange Act: The Securities Exchange Act of 1934, as amended.

 

Exchange Offer: The registration by the Company under the Securities Act of the Exchange Securities pursuant to a Registration Statement pursuant to which the Company offers the Holders of all outstanding Initial Securities permitted to be included therein the opportunity to exchange all such outstanding Initial Securities held by such Holders for Exchange Securities in an aggregate principal amount equal to the aggregate principal amount of the Initial Securities tendered in such exchange offer by such Holders.

 

Exchange Offer Registration Statement: The Registration Statement relating to the Exchange Offer, including the related Prospectus.

 

Exchange Securities: The 6 7/8% Senior Notes due 2017, of the same series under the Indenture as the Initial Securities, to be issued to Holders in exchange for Initial Securities pursuant to this Agreement.

 

Filing Date: As defined in Section 2(a) hereof.

 

FINRA: Financial Industry Regulatory Authority, Inc.

 

Free Writing Prospectus: Each free writing prospectus (as defined in Rule 405 under the Securities Act) prepared by or on behalf of the Company or used or referred to by the Company in connection with the sale of the Securities or the Exchange Securities.

 

Holder: means a Person in whose name a Note is registered.

 

Indemnified Holder: As defined in Section 7(a) hereof.

 

Indenture: The Indenture, dated as of October 4, 2010, by and among the Company, the Guarantors and U.S. Bank National Association, as trustee (the “Trustee”), pursuant to which the Securities are to be issued, as such Indenture is amended or supplemented from time to time in accordance with the terms thereof.

 

Initial Purchasers: As defined in the preamble hereto.

 

Initial Notes: As defined in the preamble hereto.

 

Initial Placement: The issuance and sale by the Company of the Initial Securities to the Initial Purchasers pursuant to the Purchase Agreement.

 

Initial Securities: As defined in the preamble hereto.

 

Interest Payment Date: As defined in the Indenture and the Securities.

 

Person: An individual, partnership, corporation, trust or unincorporated organization, or a government or agency or political subdivision thereof.

 

Prospectus: The prospectus included in a Registration Statement, as amended or supplemented by any prospectus supplement and by all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus.

 

Registration Default: As defined in Section 4 hereof.

 

Registration Statement: The Exchange Offer Registration Statement and Shelf Registration Statement, which is filed pursuant to the provisions of this Agreement, in each case,

 

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including the Prospectus included therein, all amendments and supplements thereto (including post-effective amendments) and all exhibits and material incorporated by reference therein.

 

Securities Act: The Securities Act of 1933, as amended.

 

Shelf Registration Statement: As defined in Section 3(a) hereof. 

 

Trust Indenture Act: The Trust Indenture Act of 1939, as amended.

 

Underwritten Registration or Underwritten Offering: A registration in which securities of the Company are sold to an underwriter for reoffering to the public.

 

SECTION 2.           Registered Exchange Offer.

 

(a)             Unless the Exchange Offer shall not be permissible under applicable law or Commission policy (after the procedures set forth in Section 5(a) hereof have been complied with), each of the Company and the Guarantors shall (i) cause to be filed with the Commission on or prior to 45 days after the filing deadline (such date, the “Filing Date”), as specified in the Commission’s rules and regulations, for the Company’s Form 20-F for the fiscal year ended December 31, 2011, an Exchange Offer Registration Statement under the Securities Act relating to the Exchange Securities and the Exchange Offer, (ii) use their commercially reasonable efforts to have the Exchange Offer Registration Statement declared effective by the Commission on or prior to 105 days after the Filing Date (or if such 105th day is not a Business Day, the next succeeding Business Day) and (iii) upon the effectiveness of such Exchange Offer Registration Statement, (a) commence the Exchange Offer and (b) issue Exchange Notes in exchange for all Notes tendered prior thereto by Holders that are not prohibited by any law or policy of the Commission form participating in the Exchange Offer. The Exchange Offer shall be on the appropriate from permitting registration of the Exchange Securities to be offered in exchange for the Initial Securities and to permit resales of Initial Securities held by Broker-Dealers as contemplated by Section 2(c) hereof.

 

(b)             The Company and the Guarantors shall cause the Exchange Offer Registration Statement to be effective continuously and shall keep the Exchange Offer open for a period of not less than the minimum period required under applicable federal and state securities laws to Consummate the Exchange Offer; provided, however, that in no event shall such period be less than 30 days after the date notice of the Exchange Offer is first furnished to the Holders. The Company and the Guarantors shall cause the Exchange Offer to comply with all applicable federal and state securities laws in all material respects. No securities other than the Exchange Securities shall be included in the Exchange Offer Registration Statement. The Company and the Guarantors shall use their commercially reasonable efforts to cause the Exchange Offer to be Consummated on the earliest practicable date after the Exchange Offer Registration Statement has become effective, but in no event later than 30 Business Days of the Effectiveness Target Date (or if such 30th day is not a Business Day, the next succeeding Business Day).

 

(c)             The Company shall indicate in a “Plan of Distribution” section contained in the Prospectus forming a part of the Exchange Offer Registration Statement that any Broker-Dealer who holds Initial Securities that are Initial Securities and that were acquired for its own account as a result of market-making activities or other trading activities (other than Initial Securities acquired directly from the Company), may exchange such Initial Securities pursuant to the

 

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Exchange Offer; however, such Broker-Dealer may be deemed to be an “underwriter” within the meaning of the Securities Act and must, therefore, deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the Exchange Securities received by such Broker-Dealer in the Exchange Offer, which prospectus delivery requirement may be satisfied by the delivery by such Broker-Dealer of the Prospectus contained in the Exchange Offer Registration Statement. Such “Plan of Distribution” section shall also contain all other information with respect to such resales by Broker-Dealers that the Commission may require in order to permit such resales pursuant thereto, but such “Plan of Distribution” shall not name any such Broker-Dealer or disclose the amount of Initial Securities held by any such Broker-Dealer except to the extent required by the Commission as a result of a change in policy after the date of this Agreement.

 

Each of the Company and the Guarantors shall use its commercially reasonable efforts to keep the Exchange Offer Registration Statement continuously effective, supplemented and amended as required by the provisions of Section 5(c) hereof to the extent necessary to ensure that it is available for resales of Initial Securities acquired by Broker-Dealers for their own accounts as a result of market-making activities or other trading activities, and to ensure that it conforms with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, for a period ending on the earlier of (i) 180 days from the date on which the Exchange Offer Registration Statement is declared effective, (ii) the date on which all Broker-Dealers have sold all Exchange Securities held by them that require the delivery of a Prospectus in connection with the resale thereof, and (iii) the date on which a Broker-Dealer is no longer required to deliver a prospectus in connection with market-making or other trading activities.

 

The Company shall provide sufficient copies of the latest version of such Prospectus to Broker-Dealers promptly upon request at any time during such 180-day (or shorter as provided in the foregoing sentence) period in order to facilitate such resales.

 

SECTION 3.           Shelf Registration.

 

(a)             Shelf Registration. If (i) the Company is not required to file an Exchange Offer Registration Statement or to consummate the Exchange Offer because the Exchange Offer is not permitted by applicable law or Commission policy (after the procedures set forth in Section 5(a) hereof have been complied with), (ii) for any reason the Exchange Offer is not Consummated within 30 Business Days of the Effectiveness Target Date (or if such 30th day is not a Business Day, the next succeeding Business Day), or (iii) with respect to any Holder of Initial Securities (A) such Holder notifies the Company in writing within 10 Business Days of the effectiveness of the Exchange Offer Registration Statement that it is prohibited by applicable law or Commission policy from participating in the Exchange Offer, (B) such Holder notifies the Company in writing within 10 Business Days of the effectiveness of the Exchange Offer Registration Statement that it may not resell the Exchange Securities acquired by it in the Exchange Offer to the public without delivering a prospectus and that the Prospectus contained in the Exchange Offer Registration Statement is not appropriate or available for such resales by such Holder, or (C) such Holder notifies the Company in writing within 10 Business Days of the effectiveness of the Exchange Offer Registration Statement that it is a Broker-Dealer and holds Initial Securities

 

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acquired directly from the Company or one of its affiliates, upon such Holder’s request, then the Company and the Guarantors shall cause to be filed and use their commercially reasonable efforts to cause to be declared effective a shelf registration statement pursuant to Rule 415 under the Securities Act, which may be an amendment to the Exchange Offer Registration Statement (in either event, the “Shelf Registration Statement”) on or prior to the later of (1) the 105th day after the Filing Date and (2) the 90th day after such obligation arises , which Shelf Registration Statement shall provide for resales of all Initial Securities the Holders of which shall have provided the information required pursuant to Section 3(b) hereof.

 

Each of the Company and the Guarantors shall use their commercially reasonable efforts to keep such Shelf Registration Statement continuously effective, supplemented and amended as required by the provisions of Sections 5(b) and (c) hereof to the extent necessary to ensure that it is available for resales of Initial Securities by the Holders of Initial Securities entitled to the benefit of this Section 3(a), and to ensure that it conforms with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the Commission as announced from time to time, until the earlier of (a) one year after the date the Shelf Registration Statement is declared effective and (b) the date on which all Initial Securities registered thereunder are disposed of in accordance therewith.

 

(b)             Provision by Holders of Certain Information in Connection with the Shelf  Registration Statement. No Holder of Initial Securities may include any of its Initial Securities in any Shelf Registration Statement pursuant to this Agreement unless and until (i) such Holder furnishes to the Company in writing, within 10 Business Days after receipt of a request therefor, such information as the Company may reasonably request for use in connection with any Shelf Registration Statement or Prospectus or preliminary Prospectus included therein and (ii) such Holder agrees to be bound by all provisions of this Agreement applicable to such Holder. Each Holder as to which any Shelf Registration Statement is being effected agrees to furnish promptly to the Company all information required to be disclosed in order to make the information previously furnished to the Company by such Holder not materially misleading.

 

SECTION 4.         Additional Interest.

 

(a)             If (i) any of the Registration Statements required by this Agreement is not filed with the Commission on or prior to the date specified for such filing in this Agreement, (ii) any of such Registration Statements has not been declared effective by the Commission on or prior to the date specified for such effectiveness in this Agreement (the “Effectiveness Target Date”), (iii) the Exchange Offer has not been Consummated within 30 Business Days of the Effectiveness Target Date with respect to the Exchange Offer Registration Statement or (iv) any Registration Statement required by this Agreement is filed and declared effective but (A) such Registration Statement ceases to be effective, except, in the case of the Exchange Offer Registration Statement, following the consummation of the Exchange Offer with respect to all Initial Securities tendered in connection therewith prior to the expiration of the Exchange Offer or (B) such Registration Statement or the related Prospectus ceases to be usable in connection with resales of Initial Securities 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

 

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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, (each such event referred to in clauses (i) through (iv), a “Registration Default”), the Company hereby agrees that the interest rate borne by the Initial Securities shall be increased by 0.25% per annum during the 90-day period immediately following the occurrence of any Registration Default and shall increase by 0.25% per annum at the end of each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum amount of 1.00% for all Registration Defaults (“Additional Interest”). All accrued Additional Interest will be paid by the Company and the Guarantors on each Interest Payment Date to the Global Note Holder of a global note by wire transfer of immediately available funds or by federal funds check and to Holders of Certificated Notes by wire transfer to the accounts specified by them or by mailing checks to their registered addresses if no such accounts have been specified. Following the cure of all Registration Defaults relating to the Securities, the interest rate borne by the Securities will be reduced to the original interest rate borne by such Securities; provided, however, that, if after any such reduction in interest rate, a different Registration Default occurs, the interest rate borne by the Securities shall again be increased pursuant to the foregoing provisions.

 

SECTION 5.           Registration Procedures.

 

(a)             Exchange Offer Registration Statement. In connection with the Exchange Offer, the Company and the Guarantors shall comply with all of the provisions of Section 5(c) hereof, shall use their commercially reasonable efforts to effect such exchange to permit the sale of Initial Securities, by any such Broker-Dealer, being sold in accordance with the intended method or methods of distribution thereof, and shall comply with all of the following provisions:

 

(i)           If in the reasonable opinion of counsel to the Company there is a question as to whether the Exchange Offer is permitted by applicable law, each of the Company and the Guarantors hereby agrees to seek a no-action letter or other favorable decision from the Commission allowing the Company and the Guarantors to Consummate an Exchange Offer for such Initial Securities. Each of the Company and the Guarantors hereby agrees to pursue the issuance of such a decision to the Commission staff level but shall not be required to take commercially unreasonable action to effect a change of Commission policy. Each of the Company and the Guarantors hereby agrees, however, to (A) participate in telephonic conferences with the Commission, (B) deliver to the Commission staff an analysis prepared by counsel to the Company setting forth the legal bases, if any, upon which such counsel has concluded that such an Exchange Offer should be permitted and (C) diligently pursue a favorable resolution by the Commission staff of such submission.

 

(ii)          As a condition to its participation in the Exchange Offer pursuant to the terms of this Agreement, each Holder of Initial Securities shall furnish, upon the request of the Company, prior to the Consummation thereof, a written representation to the Company (which may be contained in the letter of transmittal contemplated by the Exchange Offer Registration Statement) to the effect that (A) it is not an affiliate of the Company, (B) it is not engaged in, and does not intend to engage in, and has no

 

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arrangement or understanding with any Person to participate in, a distribution of the Exchange Securities to be issued in the Exchange Offer and (C) it is acquiring the Exchange Securities in its ordinary course of business. In addition, all such Holders of Initial Securities shall otherwise cooperate in the Company’s preparations for the Exchange Offer. Each Holder hereby acknowledges and agrees that any Broker-Dealer and any such Holder using the Exchange Offer to participate in a distribution of the securities to be acquired in the Exchange Offer (1) could not under Commission policy as in effect on the date of this Agreement rely on the position of the Commission enunciated in Morgan Stanley and Co., Inc. (available June 5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in the Commission’s letter to Shearman & Sterling dated July 2, 1993, and similar no-action letters (which may include any no-action letter obtained pursuant to clause (i) above), and (2) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction and that such a secondary resale transaction should be covered by an effective registration statement containing the selling security holder information required by Item 507 or 508, as applicable, of Regulation S-K if the resales are of Exchange Securities obtained by such Holder in exchange for Initial Securities acquired by such Holder directly from the Company.

 

(b)             Shelf Registration Statement. In connection with the Shelf Registration Statement, each of the Company and the Guarantors, to the extent applicable, shall comply with all the provisions of Section 5(c) hereof and shall use its commercially reasonable efforts to effect such registration to permit the sale of the Initial Securities being sold in accordance with the intended method or methods of distribution thereof, and pursuant thereto each of the Company and the Guarantors will as expeditiously as possible prepare and file with the Commission a Registration Statement relating to the registration on any appropriate form under the Securities Act, which form shall be available for the sale of the Initial Securities in accordance with the intended method or methods of distribution thereof.

 

(c)             General Provisions. In connection with any Registration Statement and any Prospectus required by this Agreement to permit the sale or resale of Initial Securities (including, without limitation, any Registration Statement and the related Prospectus required to permit resales of Initial Securities by Broker-Dealers), each of the Company and the Guarantors shall:

 

(i)           use its commercially reasonable efforts to keep such Registration Statement continuously effective and provide all requisite financial statements (including, if required by the Securities Act or any regulation thereunder, financial statements of the Guarantors) for the period specified in Section 2 or 3 hereof, as applicable; upon the occurrence of any event that would cause any such Registration Statement or the Prospectus contained therein (A) to contain a material misstatement or omission or (B) not to be effective and usable for resale of Initial Securities during the period required by this Agreement, the Company shall file promptly an appropriate amendment to such Registration Statement, in the case of clause (A), correcting any such misstatement or omission, and, in the case of either clause (A) or (B), use its commercially reasonable efforts to cause such amendment to be declared effective and such Registration Statement

 

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and the related Prospectus to become usable for their intended purpose(s) as soon as practicable thereafter;

 

(ii)          prepare and file with the Commission such amendments and post-effective amendments to the applicable Registration Statement as may be necessary to keep the Registration Statement effective for the applicable period set forth in Section 2 or 3 hereof, as applicable, or such shorter period as will terminate when all Initial Securities covered by such Registration Statement have been sold; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities Act if such a filing is required, and to comply fully with the applicable provisions of Rules 424 and 430A under the Securities Act in a timely manner.

 

(iii)         advise the underwriter(s), if any, and selling Holders promptly and, if requested by such Persons, to confirm such advice in writing, (A) when the Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to any Registration Statement or any post-effective amendment thereto, when the same has become effective, (B) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information relating thereto, (C) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement under the Securities Act or of the suspension by any state securities commission of the qualification of the Initial Securities for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes or (D) of the existence of any fact or the happening of any event that makes any statement of a material fact made in the Registration Statement, the Prospectus, any amendment or supplement thereto, or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in the Registration Statement or the Prospectus in order to make the statements therein (in the case of the Prospectus, in light of the circumstances under which they were made), not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Initial Securities under state securities or blue sky laws, each of the Company and the Guarantors shall use its commercially reasonable efforts to obtain the withdrawal or lifting of such order at the earliest possible time;

 

(iv)        furnish without charge to each of the Initial Purchasers, each selling Holder named in any Shelf Registration Statement, and each of the underwriter(s), if any, before filing with the Commission, copies of any Shelf Registration Statement or any Prospectus included therein or any amendments or supplements to any such Registration Statement or Prospectus (including all documents incorporated by reference after the initial filing of such Shelf Registration Statement), which documents will be subject to the review and comment of such Holders and underwriter(s) in connection with such sale, if any, for a period of at least five Business Days, and the Company will not file any such Shelf Registration Statement or Prospectus or any amendment or supplement to any such Shelf Registration Statement or Prospectus (including all such documents incorporated by

 

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reference) to which an Initial Purchaser of Initial Securities covered by such Shelf Registration Statement or the underwriter(s), if any, shall make a reasonable objection in writing within five Business Days after the receipt thereof (such objection to be deemed timely made upon confirmation of telecopy transmission within such period). The objection of an Initial Purchaser or underwriter, if any, shall be deemed to be reasonable only if such Shelf Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains a material misstatement or omission. If such material misstatement or omission is corrected, such objection will cease to be considered reasonable for purposes of this clause (iv);

 

(v)         [Reserved]

 

(vi)        in the case of a Shelf Registration Statement, make available at reasonable times for inspection by the Initial Purchasers, the managing underwriter(s), if any, participating in any disposition pursuant to such Registration Statement and any attorney or accountant retained by such Initial Purchasers or any of the underwriter(s), all relevant financial and other records, pertinent corporate documents and properties of each of the Company and the Guarantors and cause the Company’s and the Guarantors’ officers, directors and employees to supply all relevant information reasonably requested by any such Holder, underwriter, attorney or accountant in connection with such Registration Statement or any post-effective amendment thereto subsequent to the filing thereof and prior to its effectiveness and to participate in meetings with investors to the extent requested by the managing underwriter(s), if any, in each case, 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 one Initial Purchaser and on behalf of the other parties, by one counsel designated by and on behalf of such other parties; provided further, however, that the conduct of the foregoing inspection and information gathering shall be subject to the execution by all persons party to such inspection and information gathering of a reasonable confidentiality undertaking in customary form with respect to confidential and proprietary information of the Company;

 

(vii)       in the case of a Shelf Registration Statement, if requested by any selling Holders or the underwriter(s), if any, promptly incorporate in any Shelf Registration Statement or Prospectus, before it is filed, such information as such selling Holders and underwriter(s), if any, may reasonably request to have included therein, including, without limitation, information relating to the “Plan of Distribution” of the Initial Securities, information with respect to the principal amount of Initial Securities being sold to such underwriter(s), the purchase price being paid therefor and any other terms of the offering of the Initial Securities to be sold in such offering; and make all required filings of such Prospectus supplement or post-effective amendment as soon as practicable after the Company is notified of the matters to be incorporated in such Prospectus supplement or post-effective amendment;

 

(viii)      use its commercially reasonable efforts to cause the Initial Securities covered by the Shelf Registration Statement to be rated with the appropriate rating

 

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agencies, if so requested by the Holders of a majority in aggregate principal amount of Securities covered thereby or the underwriter(s), if any;

 

(ix)        if not otherwise available on EDGAR, furnish to each Initial Purchaser, each selling Holder and each of the underwriter(s), if any, without charge, at least one copy of the Registration Statement, as first filed with the Commission, and of each amendment thereto, including financial statements and schedules, all documents incorporated by reference therein and all exhibits (including exhibits incorporated therein by reference);

 

(x)         deliver to each selling Holder and each of the underwriter(s), if any, without charge, as many copies of the Prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons reasonably may request; each of the Company and the Guarantors hereby consents, subject to the provisions of this Agreement, to the use of the Prospectus and any amendment or supplement thereto by each of the selling Holders and each of the underwriter(s), if any, in connection with the offering and the sale of the Initial Securities covered by the Prospectus or any amendment or supplement thereto;

 

(xi)        enter into such customary agreements (including an underwriting agreement), and make such customary representations and warranties, and take all such other actions in connection therewith in order to expedite or facilitate the disposition of the Initial Securities pursuant to any Shelf Registration Statement contemplated by this Agreement, all to such extent as may be reasonably requested by any Initial Purchaser or by any Holder of Initial Securities or underwriter in connection with any sale or resale pursuant to any Shelf Registration Statement contemplated by this Agreement; and whether or not an underwriting agreement is entered into and whether or not the registration is an Underwritten Registration, each of the Company and the Guarantors shall:

 

(A)              furnish to each Initial Purchaser, each selling Holder and each underwriter, if any, in such substance and scope as they may request and as are customarily made by issuers to underwriters in primary underwritten offerings, upon the effectiveness of the Shelf Registration Statement:

 

(1)        a certificate, dated the date of effectiveness of the Shelf Registration Statement signed by an officer of the Company and an officer or director of each of the Guarantors or its managing partner or trustee, as applicable, concerning such matters as such parties may reasonably request;

 

(2)        a customary opinion, dated the date of effectiveness of the Shelf Registration Statement of counsel for the Company and the Guarantors, concerning such matters as such parties may reasonably request, and in any event including a statement to the effect that such counsel has participated in conferences with officers and other representatives of the Company and the Guarantors, representatives of the

 

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independent public accountants for the Company and the Guarantors, representatives of the underwriter(s), if any, and counsel to the underwriter(s), if any, in connection with the preparation of such Registration Statement and the related Prospectus and have considered the matters required to be stated therein and the statements contained therein, although such counsel has not independently verified the accuracy, completeness or fairness of such statements; and that such counsel advises that, on the basis of the foregoing, no facts came to such counsel’s attention that caused such counsel to believe that the applicable Registration Statement, at the time such Registration Statement or any post-effective amendment thereto became effective contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus contained in such Registration Statement as of its date contained an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Such counsel may state further that such counsel assumes no responsibility for, and has not independently verified, the accuracy, completeness or fairness of the financial statements, notes and schedules and other financial data included in any Registration Statement contemplated by this Agreement or the related Prospectus;

 

(3)        a customary comfort letter, dated as of the date of effectiveness of the Shelf Registration Statement, and a “bring down comfort letter” from the Company’s independent public accountants, in the customary form and covering matters of the type customarily requested to be covered in comfort letters by underwriters in connection with primary underwritten offerings, and covering or affirming the matters set forth in the comfort letters delivered pursuant to Section 5(a) of the Purchase Agreement, without exception; and

 

(4)        letters, dated as of the date of effectiveness of the Shelf Registration Statement, and a “bring down letter,” from each of the Company’s independent reserves engineering evaluators, in the customary form and covering matters of the type customarily requested to be covered in such letters by underwriters in connection with primary underwritten offerings, and covering or affirming the matters set forth in the letters delivered pursuant to Section 5(h) of the Purchase Agreement, without exception; and

 

(B)            [Reserved];

 

(C)            deliver such other documents and certificates as may be reasonably requested by such parties to evidence compliance with Section 5(c)(xi)(A) hereof and with any customary conditions contained in the underwriting agreement or

 

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other agreement entered into by the Company or any of the Guarantors pursuant to this Section 5(c)(xi), if any.

 

(xii)       use its commercially reasonable efforts to prior to any public offering of Initial Securities, cooperate with the selling Holders, the underwriter(s), if any, and their respective counsel in connection with the registration and qualification of the Initial Securities under the state securities or blue sky laws of such jurisdictions as the selling Holders or underwriter(s), if any, may reasonably request and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Initial Securities covered by the Shelf Registration Statement; provided, however, that none of the Company nor the Guarantors shall be required to register or qualify as a foreign corporation where it is not then so qualified or to take any action that would subject it to the service of process in suits or to taxation in any jurisdiction where it is not then so subject;

 

(xiii)      shall issue, upon the request of any Holder of Initial Securities covered by the Shelf Registration Statement, Exchange Securities having an aggregate principal amount equal to the aggregate principal amount of Initial Securities surrendered to the Company by such Holder in exchange therefor or being sold by such Holder; such Exchange Securities to be registered in the name of such Holder or in the name of the purchaser(s) of such Securities, as the case may be; in return, the Initial Securities held by such Holder shall be surrendered to the Company for cancellation;

 

(xiv)      cooperate with the selling Holders and the underwriter(s), if any, to facilitate the timely preparation and delivery of certificates representing Initial Securities to be sold pursuant to any Registration Statement and not bearing any restrictive legends; and enable such Initial Securities to be in such denominations and registered in such names as the Holders or the underwriter(s), if any, may request at least two Business Days prior to any sale of Initial Securities made by such Holders or underwriter(s);

 

(xv)       [Reserved]

 

(xvi)      if any fact or event contemplated by Sections 5(c)(iii)(B) through (D) hereof shall exist or have occurred, prepare a supplement or post-effective amendment to the Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of Initial Securities, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein not misleading;

 

(xvii)     provide a CUSIP number for all Securities not later than the effective date of the Registration Statement covering such Securities and provide the Trustee under the Indenture with printed certificates for such Securities which are in a form eligible for deposit with the Depository Trust Company and take all other reasonable action necessary to ensure that all such Securities are eligible for deposit with the Depository Trust Company;

 

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(xviii)    cooperate and assist in any filings required to be made with FINRA and in the performance of any due diligence investigation by any underwriter (including any “qualified independent underwriter”) that is required to be retained in accordance with the rules and regulations of the FINRA, subject to the provisions in Section 5(c)(iv);

 

(xix)      otherwise use its commercially reasonable efforts to 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 Exchange Offer or the Shelf Registration Statement and will make generally available to Holders (or otherwise provide in accordance with Section 11(a) of the Securities Act) an earnings statement satisfying the provisions of Section 11(a) of the Securities Act, no later than 45 days after the end of a 12-month period (or 90 days, if such period is a fiscal year) beginning with the first month of the Company’s first fiscal quarter commencing after the effective date of the Registration Statement, which statement shall cover such 12-month period;

 

(xx)       use its commercially reasonable efforts to cause the Indenture to be qualified under the Trust Indenture Act not later than the effective date of the first Registration Statement required by this Agreement, and, in connection therewith, cooperate with the Trustee and the Holders of Securities to effect such changes to the Indenture as may be required for such Indenture to be so qualified in accordance with the terms of the Trust Indenture Act; and to execute and use its commercially reasonable efforts to cause the Trustee to execute, all documents that may be required to effect such changes and all other forms and documents required to be filed with the Commission to enable such Indenture to be so qualified in a timely manner;

 

(xxi)      use its commercially reasonable efforts to cause all Securities covered by the Registration Statement to be listed on each securities exchange or automated quotation system on which similar securities issued by the Company are then listed if requested by the Holders of a majority in aggregate principal amount of Initial Securities or the managing underwriter(s), if any; and

 

(xxii)     [Reserved]

 

Each Holder agrees by acquisition of an Initial Security that, upon receipt of any notice from the Company of the existence of any fact of the kind described in Sections 5(c)(iii)(B) through (D) hereof, such Holder will forthwith discontinue disposition of Initial Securities pursuant to the applicable Registration Statement (and keep confidential the cause of such notice) until such Holder’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 5(c)(xvi) hereof, or until it is advised in writing (the “Advice”) by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus. If so directed by the Company, each Holder will deliver to the Company (at the Company’s expense) all copies, other than permanent file copies then in such Holder’s possession, of the Prospectus covering such Initial Securities that was current at the time of receipt of such notice. In the event the Company shall give any such notice, the time period regarding the effectiveness of such Registration Statement set forth in Section 2 or 3 hereof, as applicable, shall be extended by the number of days during the period from and including the date of the giving of such notice

 

14











 

pursuant to Sections 5(c)(iii)(B) through (D) hereof to and including the date when each selling Holder covered by such Registration Statement shall have received the copies of the supplemented or amended Prospectus contemplated by Section 5(c)(xvi) hereof or shall have received the Advice; provided, however, except as provided in Section 4 that no such extension shall be taken into account in determining whether Additional Interest is due pursuant to Section 4 hereof or the amount of such Additional Interest, it being agreed that the Company’s option to suspend use of a Registration Statement pursuant to this paragraph shall be treated as a Registration Default for purposes of Section 4 hereot.

 

SECTION 6.           Registration Expenses.

 

(a)             All expenses incident to the Company’s and the Guarantors’ performance of or compliance with this Agreement will be borne by the Company and the Guarantors, jointly and severally, regardless of whether a Registration Statement becomes effective, including, without limitation: (i) all registration and filing fees and expenses (including filings made by any Initial Purchaser or Holder with FINRA (and, if applicable, the fees and expenses of any “qualified independent underwriter” and their counsel that may be required by the rules and regulations of FINRA)); (ii) all fees and expenses of compliance with federal securities and state securities or blue sky laws; (iii) all expenses of printing (including printing certificates for the Exchange Securities to be issued in the Exchange Offer and printing of Prospectuses), messenger and delivery services and telephone; (iv) all fees and disbursements relating to the qualification of the Indenture under applicable securities laws; (v) the fees and disbursements of the Trustee and its counsel; (vi) all application and filing fees in connection with listing the Exchange Securities on a securities exchange or automated quotation system pursuant to the requirements thereof; and (vii) all fees and disbursements of independent certified public accountants of the Company and the Guarantors (including the expenses of any special audit and comfort letters required by or incident to such performance).

 

Each of the Company and the Guarantors will, in any event, bear their internal expenses (including, without limitation, all salaries and expenses of their officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any Person, including special experts, retained by the Company or the Guarantors.

 

(b)             In connection with any Shelf Registration Statement required by this Agreement, the Company and the Guarantors, jointly and severally, will reimburse the Initial Purchasers and the Holders of Initial Securities registered pursuant to the Shelf Registration Statement for the reasonable and documented fees and disbursements of not more than one counsel, who shall be Shearman & Sterling LLP or such other counsel as may be chosen by the Holders of a majority in principal amount of the Initial Securities for whose benefit such Registration Statement is being prepared.

 

SECTION 7.           Indemnification.

 

(a)             The Company and the Guarantors, jointly and severally, agree to indemnify and hold harmless (i) each Holder and (ii) each Person, if any, who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) any Holder (any of the Persons referred to in this clause (ii) being hereinafter referred to as a “controlling person”) and

 

15











 

(iii) the respective officers, directors, partners, employees, representatives and agents of any Holder or any controlling person (any Person referred to in clause (i), (ii) or (iii) may hereinafter be referred to as an “Indemnified Holder”), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, actions and expenses (including, without limitation, and as incurred, reimbursement of all reasonable costs of investigating, preparing, pursuing, settling, compromising, paying or defending any claim or action, or any investigation or proceeding by any governmental agency or body, commenced or threatened, including (subject to the provisions of this Section 7) the reasonable fees and expenses of counsel to any Indemnified Holder), joint or several, directly or indirectly caused by, related to, based upon, arising out of or in connection with (x) any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement covered by Clause 4 (or any amendment or supplement thereto), or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and (y) any untrue statement or alleged untrue statement of a material fact contained in any Prospectus (or any amendment or supplement thereto), any Free Writing Prospectus used in violation of this Agreement or any “issuer information” filed, or required to be filed pursuant to Rule 433(d) under the Securities Act (each, an “Issuer FWP”), or any omission or alleged omission to state therein a 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, except insofar as such losses, claims, damages, liabilities or expenses are caused by an untrue statement or omission or alleged untrue statement or omission that is made in reliance upon and in conformity with information relating to any of the Holders furnished in writing to the Company by any of the Holders expressly for use therein. The indemnity agreement contained in this subsection (a) shall not inure to the benefit of any Holder or Broker-Dealer from whom the person asserting any such losses, claims, damages or liabilities purchased the Securities concerned, to the extent that a prospectus or amendment or supplement thereto relating to such Securities was required to be delivered (including through satisfaction of the conditions of Commission Rule 172) by such Holder or Broker-Dealer under the Securities Act in connection with such purchase and any such loss, claim, damage or liability of such Holder or 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, an Issuer FWP correcting the applicable untrue statement or omission or alleged untrue statement or omission if the Company had previously furnished copies thereof to such Holder or Broker-Dealer. This indemnity agreement shall be in addition to any liability which the Company or any of the Guarantors may otherwise have.

 

In case any action or proceeding (including any governmental or regulatory investigation or proceeding) shall be brought or asserted against any of the Indemnified Holders with respect to which indemnity may be sought against the Company or the Guarantors, such Indemnified Holder (or the Indemnified Holder controlled by such controlling person) shall promptly notify the Company and the Guarantors in writing; provided, however, that the failure to give such notice shall not relieve any of the Company or the Guarantors of their obligations pursuant to this Agreement unless such failure results in the forfeiture of substantial rights. Such Indemnified Holder shall have the right to employ their own counsel in any such action and the fees and expenses of such counsel shall be paid, as incurred, by the Company and the Guarantors only if (i) the Indemnified Holder and the Company and the Guarantors shall have mutually agreed;

 

16











 

(ii) the Indemnified Holder shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the Company and the Guarantors; or (iii) the named parties in any such proceeding (including any impleaded parties) include both the Company and Guarantors and the Indemnified Holder and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. The Company and the Guarantors shall not, in connection with any one such action or proceeding or separate but substantially similar or related actions or proceedings in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) at any time for such Indemnified Holders, which firm shall be designated by the Holders. The Company and the Guarantors shall be liable for any settlement of any such action or proceeding effected with the Company’s and the Guarantors’ prior written consent, which consent shall not be withheld unreasonably, and each of the Company and the Guarantors agrees to indemnify and hold harmless any Indemnified Holder from and against any loss, claim, damage, liability or expense by reason of any settlement of any action effected with the written consent of the Company and the Guarantors. The Company and the Guarantors shall not, without the prior written consent of each Indemnified Holder, settle or compromise or consent to the entry of judgment in or otherwise seek to terminate any pending or threatened action, claim, litigation or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not any Indemnified Holder is a party thereto), unless such settlement, compromise, consent or termination includes an unconditional release of each Indemnified Holder from all liability arising out of such action, claim, litigation or proceeding. No indemnifying party shall be liable for any settlement or compromise of, or consent to the entry of judgment with respect to, any such action or claim effected without its consent.

 

(b)         Each Holder of Initial Securities agrees, severally and not jointly, to indemnify and hold harmless the Company, the Guarantors and their respective directors, officers, employees and agents and any Person controlling (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) the Company or any of the Guarantors, and the respective officers, directors, partners, employees, representatives and agents of each such Person, to the same extent as the foregoing indemnity from the Company and the Guarantors to each of the Indemnified Holders, but only with respect to claims and actions based on information relating to such Holder furnished in writing by such Holder expressly for use in any Registration Statement. In case any action or proceeding shall be brought against the Company, the Guarantors or their respective directors or officers or any such controlling person in respect of which indemnity may be sought against a Holder of Initial Securities, such Holder shall have the rights and duties given the Company and the Guarantors, and the Company, the Guarantors, their respective directors and officers and such controlling person shall have the rights and duties given to each Holder by the preceding paragraph.

 

(c)          If the indemnification provided for in this Section 7 is unavailable to an indemnified party under Section 7(a) or (b) hereof (other than by reason of exceptions provided in those Sections) in respect of any losses, claims, damages, liabilities, judgments, actions or expenses referred to therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities or expenses in such proportion as is

 

17











 

appropriate to reflect the relative benefits received by the Company and the Guarantors, on the one hand, and the Holders, on the other hand, from the Initial Placement (which in the case of the Company and the Guarantors shall be deemed to be equal to the total net proceeds (after excluding any discounts received by the Initial Purchasers) to the Company and the Guarantors from the Initial Placement), or if such allocation is not permitted by applicable law, the relative fault of the Company and the Guarantors, on the one hand, and the Holders, on the other hand, in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative fault of the Company on the one hand and of the Indemnified Holder on the other 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 or any of the Guarantors, on the one hand, or the Indemnified Holders, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 7(a) hereof, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim.

 

The Company, the Guarantors and each Holder of Initial Securities agree that it would not be just and equitable if contribution pursuant to this Section 7(c) were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or expenses referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 7, none of the Holders (and its related Indemnified Holders) shall be required to contribute, in the aggregate, any amount in excess of the amount by which the total discount received by such Holder from the sale of the Initial Securities exceeds the amount of any damages which such Holder has 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 indemnification contribution from any Person who was not guilty of such fraudulent misrepresentation. The Holders’ obligations to contribute pursuant to this Section 7(c) are several in proportion to the respective principal amount of Initial Securities held by each of the Holders hereunder and not joint.

 

SECTION 8.         Rule 144A. Each of the Company and the Guarantors hereby agrees with each Holder, for so long as any Initial Securities remain outstanding, to make available to any Holder or beneficial owner of Initial Securities in connection with any sale thereof and any prospective purchaser of such Initial Securities from such Holder or beneficial owner, the information required by Rule 144A(d)(4) under the Securities Act in order to permit resales of such Initial Securities pursuant to Rule 144A under the Securities Act.

 

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SECTION 9.         Participation in Underwritten Registrations. No Holder may participate in any Underwritten Registration hereunder unless such Holder (a) agrees to sell such Holder’s Initial Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all reasonable questionnaires, powers of attorney, indemnities, underwriting agreements, lock-up letters and other documents required under the terms of such underwriting arrangements.

 

SECTION 10.       Selection of Underwriters. The Holders of Initial Securities covered by the Shelf Registration Statement who desire to do so may sell such Initial Securities in an Underwritten Offering. In any such Underwritten Offering, the investment banker(s) and managing underwriter(s) that will administer such offering will be selected by the Holders of a majority in aggregate principal amount of the Initial Securities included in such offering; provided, however, that such investment banker(s) and managing underwriter(s) must be reasonably satisfactory to the Company.

 

SECTION 11.       Miscellaneous.

 

(a)           Remedies. Each of the Company and the Guarantors hereby agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Agreement and hereby agree to waive the defense in any action for specific performance that a remedy at law would be adequate. The Initial Purchasers and the Holders acknowledge and agree that the Additional Interest provided by Section 3 of this Agreement shall be the exclusive monetary remedy available to Holders for any Registration Default.

 

(b)           No Inconsistent Agreements. Each of the Company and the Guarantors will not on or after the date of this Agreement enter into any agreement with respect to their securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company’s or any of the Guarantors’ securities under any agreement in effect on the date hereof.

 

(c)           [Reserved]

 

(d)           Amendments and Waivers. The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to or departures from the provisions hereof may not be given unless the Company has (i) in the case of Section 4 hereof and this Section 11(d)(i), obtained the written consent of Holders of all outstanding Initial Securities and (ii) in the case of all other provisions hereof, obtained the written consent of Holders of a majority of the outstanding principal amount of Initial Securities (excluding any Initial Securities held by the Company or its Affiliates). Notwithstanding the foregoing, a waiver or consent to departure from the provisions hereof that relates exclusively to the rights of Holders whose securities are being tendered pursuant to the Exchange Offer and that does not affect directly or indirectly the rights of other Holders whose securities are not being tendered pursuant to such Exchange Offer may be given by the Holders of a majority of the outstanding principal amount of Initial Securities being tendered or registered; provided, however, that, with respect to any matter that directly or indirectly affects the rights of any Initial Purchaser

 

19











 

hereunder, the Company shall obtain the written consent of each such Initial Purchaser with respect to which such amendment, qualification, supplement, waiver, consent or departure is to be effective.

 

(e)           Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by hand-delivery, first-class mail (registered or certified, return receipt requested), telex, telecopier, or air courier guaranteeing overnight delivery:

 

(i)            if to a Holder, at the address set forth on the records of the Registrar under the Indenture, with a copy to the Registrar under the Indenture; and

 

(ii)           if to the Company:

 

Harvest Operations Corp.

Suite 1900, 330 5th Avenue S.W.

Calgary, Alberta

Canada T2P OL4

Fax: 403-265-3490

Attention: Dean Beacon

 

with a copy to:

 

Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, NY 10019

Facsimile: (212) 492-0078

Attention: Andrew Foley

 

All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if telecopied; and on the next Business Day, if timely delivered to an air courier guaranteeing overnight delivery.

 

Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee at the address specified in the Indenture.

 

(f)            Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including, without limitation, and without the need for an express assignment, subsequent Holders of Initial Securities; provided, however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign acquired Initial Securities from such Holder.

 

20









 

(g)           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.

 

(h)           Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

(i)            Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

 

(j)            Submission to Jurisdiction; Agent for Service; Waiver of Immunities. Each of the Company and the Guarantors irrevocably (i) agrees that any legal suit, action or proceeding against the Company or any Guarantor brought by any Holder or by any person who controls any Holder arising out of or based upon this Agreement or the transactions contemplated thereby may be instituted in any federal or state court located in the City and County of New York (a “New York Court”), (ii) waives, to the fullest extent it may effectively do so, any objection which it may now or hereafter have to the laying of venue of any such proceeding and (iii) submits to the non-exclusive jurisdiction of such courts in any such suit, action or proceeding. Each of the Company and the Guarantors has appointed CT Corporation System, New York, New York, as its authorized agent (the “Authorized Agent”) upon whom process may be served in any such action arising out of or based on this Agreement or the transactions contemplated thereby which may be instituted in any New York Court by any Initial Purchaser or by any person who controls any Initial Purchaser, expressly consents to the jurisdiction of any such court in respect of any such action, and waives any other requirements of or objections to personal jurisdiction with respect thereto. Such appointment shall be irrevocable. Each of the Company and the Guarantors represents and warrants that the Authorized Agent has agreed to act as such agent for service of process and agrees to take any and all action, including the filing of any and all documents and instruments, that may be necessary to continue such appointment in full force and effect as aforesaid. Service of process upon the Authorized Agent and written notice of such service to each of the Company and the Guarantors shall be deemed, in every respect, effective service of process upon the Company or any Guarantor, as applicable. To the extent that the Company or any Guarantor has acquired 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, execution or otherwise) with respect to itself or their property, it hereby irrevocably waives such immunity in respect of their obligations under the above-referenced documents, to the extent permitted by law. The provisions of this clause (i) shall survive any termination of this Agreement, in whole or in part.

 

(k)           Judgment Currency. If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder into any currency other than U.S. dollars, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be the rate at which in accordance with normal banking procedures the Initial Purchasers could purchase U.S. dollars with such other currency in The City of New York on the business day preceding that on which final judgment is given. The obligations of the Company and each

 

21











 

Guarantor in respect of any sum due from them to any Initial Purchaser shall, notwithstanding any judgment in any currency other than U.S. dollars, not be discharged until the first business day, following receipt by such Initial Purchaser of any sum adjudged to be so due in such other currency, on which (and only to the extent that) such Initial Purchaser may in accordance with normal banking procedures purchase U.S. dollars with such other currency; if the U.S. dollars so purchased are less than the sum originally due to such Initial Purchaser hereunder, the Company and each Guarantor agrees, as a separate obligation and notwithstanding any such judgment, to indemnify such Initial Purchaser against such loss. If the U.S. dollars so purchased are greater than the sum originally due to such Initial Purchaser hereunder, such Initial Purchaser agrees to pay to the Company and the Guarantors (but without duplication) an amount equal to the excess of the U.S. dollars so purchased over the sum originally due to such Initial Purchaser hereunder.

 

(l)            Severability. In the event that 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.

 

(m)          Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted by the Company with respect to the Initial Securities. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

 

(n)           Additional Guarantors. In the event that any other entity becomes a Guarantor of the Initial Securities pursuant to the terms of the Indenture, the Company shall cause such additional Guarantor to become a party to this Agreement.

 

(o)           The Company and the Guarantors shall not, without the prior consent of the Initial Purchasers, and each Initial Purchaser, Holder of the Securities and Broker-Dealer shall not, without the prior written consent of the Company, make any offer relating to the Securities that would constitute a “free writing prospectus”, as defined in Commission Rule 405.

 

22











 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    
	
 
    	
HARVEST OPERATIONS CORP.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ John Zahary
    
	
 
    	
 
    	
Name:
    	
John Zahary
    
	
 
    	
 
    	
Title:
    	
President and CEO
    
	
 
    	
 
    	
 
    
	
 
    	
1496965 Alberta Ltd.,
    
	
 
    	
 
    	
in its capacity as trustee of
    
	
 
    	
 
    	
HARVEST  BREEZE   TRUST NO. 1
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ John Zahary
    
	
 
    	
 
    	
Name:
    	
John Zahary
    
	
 
    	
 
    	
Title:
    	
Director
    
	
 
    	
 
    	
 
    
	
 
    	
1496965 Alberta Ltd.,
    
	
 
    	
 
    	
in its capacity as trustee of
    
	
 
    	
 
    	
HARVEST BREEZE TRUST NO. 2
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ John Zahary
    
	
 
    	
 
    	
Name:
    	
John Zahary
    
	
 
    	
 
    	
Title:
    	
Director
    
	
 
    	
 
    	
 
    
	
 
    	
1496965 Alberta Ltd.,
    
	
 
    	
 
    	
in its capacity as trustee of
    
	
 
    	
 
    	
Harvest Breeze Trust No. 2,
    
	
 
    	
 
    	
as managing partner of
    
	
 
    	
 
    	
BREEZE RESOURCES PARTNERSHIP
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ John Zahary
    
	
 
    	
 
    	
Name:
    	
John Zahary
    
	
 
    	
 
    	
Title:
    	
Director
    
	
 
    	
 
    	
 
    
	
 
    	
1496965 Alberta Ltd.,
    
	
 
    	
 
    	
in its capacity as trustee of 
    
	
 
    	
 
    	
Harvest Breeze Trust No. 2, 
    
	
 
    	
 
    	
as managing partner of
    
	
 
    	
 
    	
HAY RIVER PARTNERSHIP
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ John Zahary
    
	
 
    	
 
    	
Name:
    	
John Zahary
    
	
 
    	
 
    	
Title:
    	
Director
    
	
 
    	
 
    
	
 
    	
NORTH ATLANTIC REFINING LIMITED,
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ John Zahary
    
	
 
    	
 
    	
Name:
    	
John Zahary
    
	
 
    	
 
    	
Title:
    	
Chairman of the Board and Director
    


 

[Registration Rights Agreement]

 











 

	
 
    	
1496965 ALBERTA LTD. 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ John Zahary
    
	
 
    	
 
    	
Name:
    	
John Zahary
    
	
 
    	
 
    	
Title:
    	
Director
    


 

[Registration Rights Agreement]

 











 

The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written:

 

	
BANC OF AMERICA SECURITIES LLC 
    	
 
    
	
HSBC SECURITIES (USA) INC. 
    	
 
    
	
 
    	
Acting on behalf of itself
    	
 
    
	
 
    	
and as the Representatives of
    	
 
    
	
 
    	
the several Initial Purchasers
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Banc of America Securities LLC
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By: 
    	
/s/ J. Lex Maultsby 
    	
 
    
	
 
    	
 
    	
Name: 
    	
J. Lex Maultsby 
    	
 
    
	
 
    	
 
    	
Title:
    	
Managing Director
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
HSBC Securities (USA) Inc.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    


 

[Signature Page to Registration Rights Agreement]

 











 

The foregoing Registration Rights Agreement is hereby confirmed and accepted as of the date first above written:

 

	
BANC OF AMERICA SECURITIES LLC
    	
 
    
	
HSBC SECURITIES (USA) INC.
    	
 
    
	
 
    	
Acting on behalf of itself
    	
 
    
	
 
    	
and as the Representatives of
    	
 
    
	
 
    	
the several Initial Purchasers
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Banc of America Securities LLC
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
HSBC Securities (USA) Inc.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
/s/ Diane M. Kenna
    	
 
    
	
 
    	
 
    	
Name:
    	
Diane M. Kenna
    	
 
    
	
 
    	
 
    	
Title:
    	
Senior Vice President
    	
 
    


 

[Signature Page to Registration Rights Agreement]

 











 

Schedule A

 

HARVEST BREEZE TRUST NO. 1

HARVEST BREEZE TRUST NO. 2

BREEZE RESOURCES PARTNERSHIP

HAY RIVER PARTNERSHIP

NORTH ATLANTIC REFINING LIMITED 

1496965 ALBERTA LTD.