Document:

EXHIBIT 4.7

 

REGISTRATION RIGHTS
AGREEMENT

 

THIS
REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made and entered into as of
this         day of January, 2006 by and
among PRB Gas Transportation, Inc., a Nevada
corporation (the “Company”), and the undersigned holders of the Company’s
Senior Subordinated Convertible Notes in an aggregate amount not to exceed
$15,000,000 (collectively, the “Investor”).

 

The
parties hereby agree as follows:

 

1.               Certain Definitions.

 

As used in this Agreement,
the following terms shall have the following meanings:

 

“Affiliate”
means, with respect to any person, any other person which directly or
indirectly controls, is controlled by, or is under common control with, such
person.

 

“Business
Day” means a day, other than a Saturday or Sunday, on which banks in New
York City are open for the general transaction of business.

 

“Common
Stock” shall mean the Company’s common stock, no par value per share, and
any securities into which such shares may hereinafter be reclassified.

 

“Convertible
Note” shall mean the Company’s Senior Subordinated Convertible Notes dated
as of the date hereof in the principal amount not to exceed US $15,000,000,
bearing interest at 10% per annum payable quarterly in arrears with interest
only payable commencing March 15, 2006 and with all principal and unpaid
interest due in full 30 months from date of issuance.

 

“Investor”
shall mean those undersigned holders of the Convertible Note that have lent up
to an aggregate of $15,000,000 (US) pursuant to the Convertible Note, and any
Affiliate or permitted transferee or transferees of the Investor who is a
subsequent holder of any Registrable Securities.

 

“Prospectus”
shall mean the prospectus included in any Registration Statement, as amended or
supplemented by any prospectus supplement, with respect to the terms of the
offering of any portion of the Registrable Securities covered by such
Registration Statement and by all other amendments and supplements to the
prospectus, including post-effective amendments and all material incorporated
by reference in such prospectus.

 

“Register,”
“registered” and “registration” refer to a registration made by
preparing and filing a Registration Statement in compliance with the 1933 Act
(as defined below), and the declaration or ordering of effectiveness of such
Registration Statement or document.

 

“Registrable
Securities” or “Registrable Security” shall mean the Shares, any other
securities issued or issuable with respect to or in exchange for Registrable
Securities; provided, that, a security shall cease to be a Registrable Security
upon (A) sale pursuant to a Registration Statement or Rule 144 under the 1933
Act or (B) such security becoming eligible, and the Company’s confirming such
eligibility in writing, for sale by the Investor pursuant to Rule 144(k).

 

“Registration
Statement” shall mean any registration statement of the Company filed under
the 1933 Act that covers the resale of any of the Registrable Securities
pursuant to the provisions of this

 

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Agreement, amendments and
supplements to such Registration Statement, including post-effective
amendments, all exhibits and all material incorporated by reference in such
Registration Statement.

 

“Required
Investors” means the Investor and others who are affiliates and permitted
transferees of the Investor holding a majority of the Registrable Securities.

 

“SEC”
means the U.S. Securities and Exchange Commission.

 

“Shares”
means the shares of Common Stock issued upon conversion of and pursuant to the
Convertible Note.

 

“1933
Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

 

“1934
Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder.

 

2.               Registration. 

 

(a)   Registration Statements.

 

(i)    Promptly following the
closing of the purchase and sale of the Convertible Notes (the “Closing Date”)
but no later than ninety (90) days after the Closing Date (the “Filing Deadline”),
the Company shall prepare and file with the SEC one Registration Statement on
Form S-1 (or on such form of registration statement as is then available to
effect a registration for resale of the Registrable Securities), covering the
sale of the Registrable Securities on their issuance in an amount at least
equal to the number of Shares that the Company may issue at the current
conversion price of $7.00 per Share. 
Such Registration Statement shall include the plan of distribution
attached hereto as Exhibit A. Such
Registration Statement also shall cover, to the extent allowable under the 1933
Act and the rules promulgated thereunder (including Rule 416), such
indeterminate number of additional shares of Common Stock resulting from stock
splits, stock dividends or similar transactions with respect to the Registrable
Securities. The Company shall use its reasonable best efforts to obtain from
each person who now has piggyback registration rights a waiver of those rights
with respect to the Registration Statement. The Registration Statement (and
each amendment or supplement thereto, and each request for acceleration of
effectiveness thereof) shall be provided in accordance with Section 3(c) to the
Investors’ counsel prior to its filing or other submission. If a Registration
Statement covering the Registrable Securities is not filed with the SEC on or
prior to the Filing Deadline, the Company will make pro rata payments to each
Investor, as liquidated damages and not as a penalty, in an amount equal to
1.00% of the aggregate amount invested by such Investor for each 30-day period
or pro rata for any portion thereof following the Filing Deadline for which no
Registration Statement is filed with respect to the Registrable Securities.
Such payments shall be made to each Investor in cash. Notwithstanding the
foregoing, such payments shall not constitute the Investor’s exclusive remedy.

 

(ii)   S-3 Qualification.
Promptly following the date (the “Qualification Date”) upon which the Company
becomes eligible to use a registration statement on Form S-3 to register the
Registrable Securities or Additional Shares, as applicable, for resale, but in
no event more than sixty (60) days after the Qualification Date (the “Qualification
Deadline”), the Company shall file a registration statement on Form S-3
covering the Registrable Securities (or a post-effective amendment on Form S-3
to the registration statement on Form S-1) (a “Shelf Registration Statement”)
and shall use commercially reasonable efforts to cause such Shelf Registration
Statement to be declared effective as promptly as practicable thereafter.

 

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(b)   Expenses. The Company
will pay all expenses associated with each registration, including filing and
printing fees, the Company’s counsel and accounting fees and expenses, costs
associated with clearing the Registrable Securities for sale under applicable
state securities laws, listing fees and the Investors’ reasonable expenses in
connection with the registration, but excluding the Investors’ legal fees,
discounts, commissions, fees of underwriters, selling brokers, dealer managers
or similar securities industry professionals with respect to the Registrable
Securities being sold.

 

(c)   Effectiveness.

 

(i)    The Company shall use
commercially reasonable efforts to have the Registration Statement declared
effective as soon as practicable. The Company shall notify the Investors by
facsimile or e-mail as promptly as practicable, and in any event, within
forty-eight (48) hours, after any Registration Statement is declared effective
and shall simultaneously provide the Investors with copies of any related
Prospectus to be used in connection with the sale or other disposition of the
securities covered thereby. If (A)(x) a Registration Statement covering the
Registrable Securities is not declared effective by the SEC prior to the
earlier of (i) five (5) Business Days after the SEC shall have informed the
Company that no review of the Registration Statement will be made or (ii) the
120th day after the Closing Date or (B) after a Registration
Statement has been declared effective by the SEC, sales of Shares cannot be
made pursuant to such Registration Statement for any reason (including without
limitation by reason of a stop order, or the Company’s failure to update the
Registration Statement), but excluding the inability of any Investor to sell
the Registrable Securities covered thereby due to market conditions and except
as excused pursuant to subparagraph (ii) below, then the Company will make pro
rata payments to each Investor, as liquidated damages and not as a penalty, in
an amount equal to 1.00% of the aggregate amount invested by such Investor for
each 30-day period or pro rata for any portion thereof following the date by
which such Registration Statement should have been effective (the “Blackout
Period”).  The amounts payable as
liquidated damages pursuant to this paragraph shall be paid monthly within
three (3) Business Days of the last day of each month following the
commencement of the Blackout Period until the termination of the Blackout
Period. Such payments shall be made to each Investor in cash. Notwithstanding
the foregoing, such payments shall not constitute the Investor’s exclusive
remedy.

 

(ii)   For not more than twenty
(20) consecutive days or for a total of not more than forty-five (45) days in
any twelve (12) month period, the Company may delay the disclosure of material
non-public information concerning the Company, by suspending the use of any
Prospectus included in any registration contemplated by this Section containing
such information, the disclosure of which at the time is not, in the good faith
opinion of the Company, in the best interests of the Company (an “Allowed Delay”);
provided, that the Company shall promptly (a) notify the Investors in writing
of the existence of (but in no event, without the prior written consent of an
Investor, shall the Company disclose to such Investor any of the facts or
circumstances regarding) material non-public information giving rise to an Allowed
Delay, (b) advise the Investors in writing to cease all sales under the
Registration Statement until the end of the Allowed Delay and (c) use
commercially reasonable efforts to terminate an Allowed Delay as promptly as
practicable.

 

3.     Company Obligations.
The Company will use commercially reasonable efforts to effect the registration of the Registrable Securities
in accordance with the terms hereof, and pursuant thereto the Company will, as
expeditiously as possible:

 

(a)    use commercially reasonable efforts to cause
such Registration Statement to become effective and to remain continuously
effective for a period that will terminate upon the earlier of (i) the date on
which all Registrable Securities covered by such Registration Statement as
amended from time to time, have been sold, and (ii) the date on which all
Registrable Securities covered by such Registration Statement

 

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may he sold pursuant to Rule
144(k) (the “Effectiveness Period”) and advise the Investors in writing when
the Effectiveness Period has expired;

 

(b)   prepare and file with the SEC such amendments
and post-effective amendments to the Registration Statement and the Prospectus
as may be necessary to keep the Registration Statement effective for the period
specified in Section 3(a) and to comply with the provisions of the 1933 Act and
the 1934 Act with respect to the distribution of all of the Registrable
Securities covered thereby;

(c)   provide copies to and permit counsel
designated by the Investors to review each Registration Statement and all
amendments and supplements thereto prior to their filing with the SEC;

 

(d)   furnish to the Investors’ legal counsel (i)
promptly after the same is prepared and publicly distributed, filed with the
SEC, or received by the Company (but not later than two (2) Business Days after
the filing date, receipt date or sending date, as the case may be) one (1) copy
of any Registration Statement and any amendment thereto, each preliminary
prospectus and Prospectus and each amendment or supplement thereto, and each
letter written by or on behalf of the Company to the SEC or the staff of the
SEC and each item of correspondence from the SEC or the staff of the SEC, in
each case relating to such Registration Statement (other than any portion of
any item thereof which contains information for which the Company has sought
confidential treatment), and (ii) such number of copies of a Prospectus,
including a preliminary prospectus, and all amendments and supplements thereto
and such other documents as each Investor may reasonably request in order to
facilitate the disposition of the Registrable Securities owned by such Investor
that are covered by the related Registration Statement;

 

(e)   use commercially reasonable efforts to (i)
prevent the issuance of any stop order or other suspension of effectiveness
and, (ii) if such order is issued, obtain the withdrawal of any such order at
the earliest possible moment;

 

(f)    prior to any public offering of Registrable
Securities, use commercially reasonable efforts to register or qualify or
cooperate with the Investors and their counsel in connection with the
registration or qualification of such Registrable Securities for offer and sale
under the securities or blue sky laws of such jurisdictions requested by the
Investors and do any and all other commercially reasonable acts or things
necessary or advisable to enable the distribution in such jurisdictions of the
Registrable Securities covered by the Registration Statement; provided, however,
that the Company shall not be required in connection therewith or as a
condition thereto to (i) qualify to do business in any jurisdiction where it
would not otherwise be required to qualify but for this Section 3(f), (ii)
subject itself to general taxation in any jurisdiction where it would not
otherwise be so subject but for this Section 3(f) or (iii) file a general
consent to service of process in any such jurisdiction;

 

(g)   use commercially reasonable efforts to cause
all Registrable Securities covered by a Registration Statement to be listed on
each securities exchange, interdealer quotation system or other market on which
similar securities issued by the Company are then listed;

 

(h)   immediately notify the Investors, at any time
when a Prospectus relating to Registrable Securities is required to be
delivered under the 1933 Act, upon discovery that, or upon the happening of any
event as a result of which, the Prospectus included in a Registration
Statement, as then in effect, includes an untrue statement of a material fact
or omits to state any material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances
then existing, and at the request of any such holder, promptly prepare and
furnish to such holder a reasonable number of copies of a supplement to or an
amendment of such Prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such Registrable Securities, such Prospectus
shall not include an

 

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untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing;

 

(i)    otherwise use commercially reasonable
efforts to comply with all applicable rules and regulations of the SEC under
the 1933 Act and the 1934 Act, take such other actions as may he reasonably
necessary to facilitate the registration of the Registrable Securities
hereunder; and make available to its security holders, as soon as reasonably
practicable, but not later than the Availability Date (as defined below), an
earnings statement covering a period of at least twelve (12) months, beginning
after the effective date of each Registration Statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the 1933 Act,
including Rule 158 promulgated thereunder (for the purpose of this subsection
3(i), “Availability Date” means the 45th day following the end of the fourth
fiscal quarter that includes the effective date of such Registration Statement,
except that, if such fourth fiscal quarter is the last quarter of the Company’s
fiscal year, “Availability Date” means the 90th day after the end of such
fourth fiscal quarter); and

 

(j)    with a view to making available to the
Investors the benefits of Rule 144 (or its successor rule) and any other rule
or regulation of the SEC that may at any time permit the Investors to sell
shares of Common Stock to the public without registration, the Company
covenants and agrees to:  (i) make and
keep public information available, as those terms are understood and defined in
Rule 144, until the earlier of (A) six months after such date as all of the
Registrable Securities may be resold pursuant to Rule 144(k) or any other rule
of similar effect or (B) such date as all of the Registrable Securities shall
have been resold; (ii) file with the SEC in a timely manner all reports and
other documents required of the Company under the 1934 Act; and (iii) furnish
to each Investor upon request, as long as such Investor owns any Registrable
Securities, (A) a written statement by the Company that it has complied with
the reporting requirements of the 1934 Act, (B) a copy of the Company’s most
recent Annual Report on Form 10-KSB or Quarterly Report on Form 10-QSB and (C)
such other information as may be reasonably requested in order to avail such
Investor of any rule or regulation of the SEC that permits the selling of any
such Registrable Securities without registration.

 

4.     Due Diligence Review;
Information. The Company shall make available, during normal business
hours, for inspection and review by the Investors, advisors to and
representatives of the Investors (who may or may not be affiliated with the
Investors and who are reasonably acceptable to the Company), all financial and
other records, all SEC Filings (as defined in the Convertible Note) and other
filings with the SEC, and all other corporate documents and properties of the
Company as may be reasonably necessary for the purpose of such review, and
cause the Company’s officers, directors and employees, within a reasonable time
period, to supply all such information reasonably requested by the Investors or
any such representative, advisor or underwriter in connection with such
Registration Statement (including, without limitation, in response to all
questions and other inquiries reasonably made or submitted by any of them),
prior to and from time to time after the filing and effectiveness of the
Registration Statement for the sole purpose of enabling the Investors and such
representatives, advisors and underwriters and their respective accountants and
attorneys to conduct initial and ongoing due diligence with respect to the Company
and the accuracy of such Registration Statement.

 

The Company shall not disclose material nonpublic information to the
Investors, or to advisors to or representatives of the Investors, unless prior
to disclosure of such information the Company identifies such information as
being material nonpublic information and provides the Investors, such advisors
and representatives with the opportunity to accept or refuse to accept such
material nonpublic information for review and any Investor wishing to obtain
such information enters into an appropriate confidentiality agreement with the
Company with respect thereto.

 

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5.     Obligations of the
Investors. 

 

(a)   Each Investor shall furnish in writing to the
Company such information regarding itself, the Registrable Securities held by
it and the intended method of disposition of the Registrable Securities held by
it, as shall be reasonably required to effect the registration of such
Registrable Securities and shall execute such documents in connection with such
registration as the Company may reasonably request. At least five (5) Business
Days prior to the first anticipated filing date of any Registration Statement,
the Company shall notify each Investor of the information the Company requires
from such Investor if such Investor elects to have any of the Registrable
Securities included in the Registration Statement. An Investor shall provide
such information to the Company at least two (2) Business Days prior to the first
anticipated filing date of such Registration Statement if such Investor elects
to have any of the Registrable Securities included in the Registration
Statement.

 

(b)   Each Investor, by its acceptance of the
Registrable Securities agrees to cooperate with the Company as reasonably
requested by the Company in connection with the preparation and filing of a
Registration Statement hereunder, unless such Investor has notified the Company
in writing of its election to exclude all of its Registrable Securities from
such Registration Statement.

 

(c)   Each Investor agrees that, upon receipt of
any notice from the Company of either (i) the commencement of an Allowed Delay
pursuant to Section 2(c)(ii) or (ii) the happening of an event pursuant to
Section 3(h) hereof, such Investor will immediately discontinue disposition of
Registrable Securities pursuant to the Registration Statement covering such
Registrable Securities, until the Investor’s receipt of the copies of the
supplemented or amended prospectus filed with the SEC and until any related
post-effective amendment is declared effective and, if so directed by the
Company, the Investor shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of destruction) all
copies in the Investor’s possession of the Prospectus covering the Registrable
Securities current at the time of receipt of such notice.

 

6.     Indemnification. 

 

(a)   The Company will indemnify and hold harmless
each Investor and its officers, directors, members, limited partners, employees
and agents, successors and assigns, and each other person, if any, who controls
such Investor within the meaning of the 1933 Act, against any losses, claims,
damages or liabilities, joint or several, to which they may become subject
under the 1933 Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon: (i)
any untrue statement or alleged untrue statement of any material fact contained
in any Registration Statement, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof; (ii) any blue sky
application or other document executed by the Company specifically for that
purpose or based upon written information furnished by the Company filed in any
state or other jurisdiction in order to qualify any or all of the Registrable
Securities under the securities laws thereof (any such application, document or
information herein called a “Blue Sky Application”); (iii) 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; (iv) any violation
by the Company or its agents of any rule or regulation promulgated under the
1933 Act applicable to the Company or its agents and relating to action or
inaction required of the Company in connection with such registration; or (v)
any failure to register or qualify the Registrable Securities included in any
such Registration in any state where the Company or its agents has
affirmatively undertaken or agreed in writing that the Company will undertake
such registration or qualification on an Investor’s behalf and will reimburse
such Investor, and each such officer, director or member and each such
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
any such case if and to the extent that

 

6

 

any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission so made in conformity with
information furnished by such Investor or any such controlling person in
writing specifically for use in such Registration Statement or Prospectus.

 

(b)   Indemnification by the Investors. Each
Investor agrees, severally but not jointly, to indemnify and hold harmless, to
the fullest extent permitted by law, the Company, its directors, officers,
employees, stockholders and each person who controls the Company (within the
meaning of the 1933 Act) against any losses, claims, damages, liabilities and expense
(including reasonable attorney fees) resulting from any untrue statement of a
material fact or any omission of a material fact required to be stated in the
Registration Statement or Prospectus or preliminary prospectus or amendment or
supplement thereto or necessary to make the statements therein not misleading,
to the extent, but only to the extent that such untrue statement or omission is
contained in any information furnished in writing by such
Investor to the Company specifically for inclusion in such Registration
Statement or Prospectus or amendment or supplement thereto. In no event shall
the liability of an Investor be greater in amount than the dollar amount of the
proceeds (net of all expense paid by such Investor in connection with any claim
relating to this Section 6 and the amount of any damages such Investor has
otherwise been required to pay by reason of such untrue statement or omission)
received by such investor upon the sale of the Registrable Securities included
in the Registration Statement giving rise to such indemnification obligation.

 

(c)   Conduct of Indemnification Proceedings.
Any person entitled to indemnification hereunder shall (i) give prompt notice
to the indemnifying party of any claim with respect to which it seeks indemnification
and (ii) permit such indemnifying party to assume the defense of such claim
with counsel reasonably satisfactory to the indemnified party; provided that
any person entitled to indemnification hereunder shall have the right to employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such person unless (a)
the indemnifying party has agreed to pay such fees or expenses, (b) the
indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to such person or (c) in the reasonable
judgment of any such person, based upon written advice of its counsel, a
conflict of interest exists between such person and the indemnifying party with
respect to such claims (in which case, if the person notifies the indemnifying
party in writing that such person elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such claim on behalf of such person); and
provided, further, that the failure of any indemnified party to give notice as
provided herein shall not relieve the indemnifying party of its obligations
hereunder, except to the extent that such failure to give notice shall
materially adversely affect the indemnifying party in the defense of any such
claim or litigation, it is understood that the indemnifying party shall not, in
connection with any proceeding in the same jurisdiction, be liable for fees or
expenses of more than one separate firm of attorneys at any time for all such
indemnified parties. No indemnifying party will, except with the consent of the
indemnified party, consent to entry of any judgment or enter into any
settlement that does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such indemnified party of a release from all
liability in respect of such claim or litigation.

 

(d)   Contribution. If for any reason the
indemnification provided for in the preceding paragraphs (a) and (b) is
unavailable to an indemnified party or insufficient to hold it harmless, other
than as expressly specified therein, then the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as a result
of such loss, claim, damage or liability in such proportion as is appropriate
to reflect the relative fault of the indemnified party and the indemnifying
party, as well as any other relevant equitable considerations. No person guilty
of fraudulent misrepresentation within the meaning of Section 11(f) of the 1933
Act shall be entitled to contribution from any person not guilty of such
fraudulent misrepresentation. In no event shall the contribution obligation of
a holder of Registrable Securities be greater in amount than the dollar amount
of the proceeds (net of all expenses paid by such

 

7

 

holder in connection with
any claim relating to this Section 6 and the amount of any damages such holder
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission) received by it upon the sale of the
Registrable Securities giving rise to such contribution obligation.

 

7.     Miscellaneous. 

 

(a)   Amendments and Waivers. This Agreement
may be amended only by a writing signed by the Company and the Required
Investors. The Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company shall
have obtained the written consent to such amendment, action or omission to act,
of the Required Investors.

 

(b)   Notices. All notices and other
communications provided for or permitted hereunder shall be made as set forth
in Section (m)(iv) of the Convertible Note.

 

(c)   Assignments and Transfers by Investors.
The provisions of this Agreement shall be binding upon and inure to the benefit
of the Investors and their respective successors and assigns. An Investor may
transfer or assign, in whole or from time to time in part, to one or more
persons its rights hereunder in connection with the transfer of Registrable
Securities by such Investor to such person, provided that such Investor
complies with all laws applicable thereto and provides written notice of assignment
to the Company promptly after such assignment is effected.

 

(d)   Assignments and Transfers by the Company.
This Agreement may not be assigned by the Company (whether by operation of law
or otherwise) without the prior written consent of the Required Investors,
provided, however, that the Company may assign its rights and delegate its
duties hereunder to any surviving or successor corporation in connection with a
merger or consolidation of the Company with another corporation, or a sale,
transfer or other disposition of all or substantially all of the Company’s
assets to another corporation, without the prior written consent of the
Required Investors, after notice duly given by the Company to each Investor.

 

(e)   Benefits of the Agreement. The terms and
conditions of this Agreement shall inure to the benefit of and be binding upon
the respective permitted successors and assigns of the parties. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.

 

(f)    Counterparts; Faxes. This Agreement
may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument. This Agreement may also be executed via facsimile, which shall he
deemed an original.

 

(g)   Titles and Subtitles. The titles and subtitles
used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.

 

(h)   Severability. Any provision of this
Agreement that is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof but shall
he interpreted as if it were written so as to be enforceable to the maximum
extent permitted by applicable law, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.  To the extent permitted by applicable law,
the parties hereby waive any provision of law which renders any provisions
hereof prohibited or unenforceable in any respect.

 

8

 

(i)    Further Assurances. The parties shall
execute and deliver all such further instruments and documents and take all
such other actions as may reasonably be required to carry out the transactions
contemplated hereby and to evidence the fulfillment of the agreements herein
contained.

 

(j)    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. This
Agreement supersedes all prior agreements and understandings between the
parties with respect to such subject matter.

 

(k)   Governing Law Consent to Jurisdiction; Waiver
of Jury Trial. This
Agreement shall be governed by, and construed in accordance with, the internal
laws of the State of Colorado without regard to the choice of law principles
thereof. Each of the parties hereto irrevocably submits to the exclusive
jurisdiction of the courts of the State of Colorado located in the City and
County of Denver and the United States District Court in the City and County of
Denver for the purpose of any suit, action, proceeding or judgment relating to
or arising out of this Agreement and the transactions contemplated hereby. Each
of the parties hereto irrevocably consents to the jurisdiction of any such
court in any such suit, action or proceeding and to the laying of venue in such
court. Each party hereto irrevocably waives any objection to the laying of
venue of any such suit, action or proceeding brought in such courts and
irrevocably waives any claim that any such suit, action or proceeding brought
in any such court has been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST
A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS
THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

 

IN
WITNESS WHEREOF, the parties have executed this Agreement or caused their duly
authorized officers to execute this Agreement as of the date first above
written.

 

	
  The
  Company:

  	
  PRB
  Gas Transportation, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Robert
  W. Wright

  	
   

  
	
   

  	
   

  	
  Chief
  Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  The
  Investor(s):

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
							

 

9

 

EXHIBIT A

TO

REGISTRATION RIGHTS AGREEMENT

 

PLAN OF DISTRIBUTION

 

The selling stockholder(s), which as used herein includes donees,
pledgees, transferees or other successors-in-interest selling shares of common
stock or interests in shares of common stock received after the date of
this prospectus from a selling stockholder as a gift, pledge, partnership
distribution or other transfer, may, from time to time, sell, transfer or
otherwise dispose of any or all of their shares of common stock or interests in
shares of common stock on any stock exchange, market or trading facility
on which the shares are traded or in private transactions. These dispositions
may be at fixed prices, at prevailing market prices at the time of sale, at
prices related to the prevailing market price, at varying prices determined at
the time of sale or at negotiated prices.

 

The selling stockholder(s) may use any one or more of the following
methods when disposing of shares or interests therein:

 

•                  ordinary brokerage transactions and
transactions in which the broker-dealer solicits purchasers;

 

•      block trades in which the broker-dealer
will attempt to sell the shares as agent, but may position and resell a portion
of the block as principal to facilitate the transaction;

 

•      purchases by a broker-dealer as principal
and resale by the broker-dealer for its account;

 

•      an exchange distribution in accordance
with the rules of the applicable exchange;

 

•     privately negotiated transactions;

 

•      through the writing or settlement of
options or other hedging transactions, whether through an options exchange or
otherwise;

 

•      broker-dealers may agree with the selling
stockholders to sell a specified number or such shares at a stipulated price
per share; and

 

•      a
combination of any such methods of sale.

 

The selling stockholder(s) may, from time to time, pledge or grant a
security interest in some or all of the shares of common stock owned by them
and, if they default in the performance of their secured obligations, the
pledgees or secured parties may offer and sell the shares of common stock, from
time to time, under this prospectus, or under an amendment to this prospectus
under Rule 424(b)(3) or other applicable provision of the Securities Act
amending the list of selling stockholders to include the pledgee, transferee or
other successors in interest as selling stockholders under this prospectus. The
selling stockholders also may transfer the shares of common stock in other
circumstances, in which case the transferees, pledgees or other successors in
interest will be the selling beneficial owners for purposes of this prospectus.

 

1

 

The aggregate proceeds to the selling stockholders from the sale of the
common stock offered by them will be the purchase price of the common stock
less discounts or commissions, if any. Each of the selling stockholders
reserves the right to accept and, together with their agents from time to time,
to reject, in whole or in part, any proposed purchase of common stock to be
made directly or through agents. We will not receive any of the proceeds from
this offering. Upon any exercise of the warrants by payment of cash, however,
we will receive the exercise price of the warrants.

 

The
selling stockholders also may resell all or a portion of the shares in open
market transactions in reliance upon Rule 144 under the Securities Act of 1933,
provided that they meet the criteria and conform to the requirements of that
rule.

 

The
selling stockholders and any underwriters, broker-dealers or agents that
participate in the sale of the common stock or interests therein may be
underwriters within the meaning of Section 2(11) of the Securities Act. Any
discounts, commissions, concessions or profit they earn on any resale of the
shares may be underwriting discounts and commissions under the Securities Act.
Selling stockholders who are ‘underwriters’ within the meaning of Section 2(11)
of the Securities Act will be subject to the prospectus delivery requirements
of the Securities Act.

 

To
the extent required, the shares of our common stock to be sold, the names of
the selling stockholders, the respective purchase prices and public offering
prices, the names of any agents, dealer or underwriter, any applicable
commissions or discounts with respect to a particular offer will be set forth
in an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.

 

In
order to comply with the securities laws of some states, if applicable, the
common stock may be sold in these jurisdictions only through registered or
licensed brokers or dealers. In addition, in some states the common stock may
not be sold unless it has been registered or qualified for sale or an exemption
from registration or qualification requirements is available and is complied
with.

 

We
have advised the selling stockholders that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of shares in the market
and to the activities of the selling stockholders and their affiliates. In
addition, we will make copies of this prospectus (as it may he supplemented or
amended from time to time) available to the selling stockholders for the
purpose of satisfying the prospectus delivery requirements of the Securities
Act. The selling stockholders may indemnify any broker-dealer that participates
in transactions involving the sale of the shares against certain liabilities,
including liabilities arising under the Securities Act.

 

We
have agreed to indemnify the selling stockholders against liabilities,
including liabilities under the Securities Act and state securities laws,
relating to the registration of the shares offered by this prospectus.

 

We have agreed with the selling stockholders to keep the registration
statement of which this prospectus constitutes a part effective until the earlier of (1) such time as all of the shares
covered by this prospectus have been disposed of pursuant to and
in accordance with the registration statement or (2) the date on which the shares
may be sold pursuant to Rule
144(k) of the Securities Act.

 

2EXHIBIT 10.15

 

SUBSCRIPTION AGREEMENT

 

PRB Gas Transportation, Inc.

1875 Lawrence Street, Suite 450

Denver, Colorado  80202

Attn:   Robert W. Wright, Chief
Executive Officer

 

Dear Mr. Wright:

 

The undersigned (“Investor or Subscriber”) has been provided certain
information concerning PRB Gas Transportation, Inc. (the “Company”) and its
offering of up to $15,000,000 of its senior subordinated convertible notes (“Notes”).  The information includes drafts of the Note
Document (as hereinafter defined), the Registration Rights Agreement, the
Company’s responses to questions Investor has asked and the provision of any
other documents the Investor has requested. 
The Investor has also reviewed all of the Company’s filings made with
the Securities and Exchange Commission over the last 24 months (“SEC Filings”).

 

A.            Verification
of Status as “Accredited Investor” under Regulation D.

 

The Investor represents and warrants to the Company that he or she is
an “accredited investor” within the meaning of Regulation D under the
Securities Act and has initialed the statements below which apply to the
Investor.

 

Please Initial Applicable Statements Below

 

	
  1.

  	
   

  	
   

  	
   

  	
  The Investor is a natural person (individual) whose own net worth,
  taken together with the net worth of the Investor’s spouse, exceeds
  $1,000,000. Net worth for this purpose means total assets (including
  residence, personal property and other assets) in excess of total
  liabilities.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
   

  	
   

  	
  The Investor is a natural person (individual) who had an individual
  income in excess of $200,000 (or joint income with the Investor’s spouse in
  excess of $300,000) in each of the two previous years and who reasonably
  expects a gross income in excess of $200,000 (or joint income with the
  Investor’s spouse in excess of $300,000) this year.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
   

  	
   

  	
  The investor is an entity with sufficient
  assets as set forth in Rule 501 of Regulation D to qualify as an “accredited
  investor.”

  

 

B.            Agreement.  The
Investor agrees as follows:

 

1.             Subscription for
the Notes.

 

The Investor subscribes for and agrees to purchase Notes in the face
amount set forth below, on the terms and conditions described herein and in the
Senior Subordinated Convertible Note (“Note Document”) attached hereto.

 

 

2.             Certain
Acknowledgments and Agreements of the Investor.

 

The Investor understands, acknowledges and agrees that:

 

(a)           The subscription for
the Notes contained herein may be accepted or rejected, in whole or in part, by
the Company in its sole and absolute discretion. No subscription shall be
deemed accepted until the Investor has received an executed copy of this
Subscription Agreement.

 

(b)           Except as provided
under applicable state securities laws, this subscription is and shall be
irrevocable, except that the Investor shall have no obligations hereunder if this
subscription is for any reason rejected or this offering is for any reason
cancelled.

 

(c)           All documents
pertaining to this investment have been made available for inspection by the
Investor, and the books and records of the Company have been available for
inspection by the Investor.

 

(d)           No foreign, federal
or state authority has made any finding or determination as to the fairness for
investment of the Notes and no foreign, federal or state authority has
recommended or endorsed or shall recommend or endorse this offering.

 

3.             Representations
and Warranties of the Investor.

 

The Investor understands that the Notes are being issued in reliance
upon the exemptions provided in the Securities Act of 1933 (the “Securities Act”)
and/or Regulation D thereunder for transactions involving limited offers and
sales, and the Investor, for himself and for his heirs, personal
representatives, successors and assigns, makes the following representations,
declarations and warranties to the Company with the intent that the same may be
relied upon in determining the suitability of the undersigned as an investor in
the Notes:

 

(a)           The Investor has
received, read carefully and understands the Note Document, all exhibits
thereto and the SEC Filings and has consulted his own attorney, accountant or
investment advisor with respect to the investment contemplated hereby and its
suitability for the Investor.

 

(b)           The Company has made
available to the Investor, during the course of this transaction and prior to
the purchase of the Notes, the opportunity to ask questions of and receive
answers from the Company concerning the terms and conditions of the offering
and the business of the Company, and to obtain any additional information
necessary to verify the information contained in the Note Document, all
exhibits thereto and the SEC Filings or otherwise relative to the financial
data and business of the Company, to the extent that the Company possesses such
information or can acquire it without unreasonable effort or expense, and all such
questions, if asked, have been answered satisfactorily and all such documents,
if examined, have been found to be fully satisfactory.

 

(c)           The Investor
understands and acknowledges that (i) the Investor must bear the economic risk
of his investment in the Notes for an extended period of time, (ii) the Notes
have not been registered under the Securities Act or any state securities laws
and are being offered and sold in reliance upon exemptions provided in the
Securities Act and state securities laws for transactions not involving any
public offering and, therefore, cannot be resold or transferred unless they are
subsequently registered under the Securities Act and applicable state laws or
unless an exemption from such registration is available, (iii) the Investor is
purchasing the Notes for investment purposes only for the account of the
Investor and not with any view toward a distribution thereof, (iv) the Investor
has no contract, undertaking, agreement or arrangement with any person to sell,
transfer or pledge to such person or

 

2

 

anyone else any of the Notes that the Investor hereby subscribes to
purchase or any part thereof, and the Investor has no present plans to enter
into any such contract, undertaking, agreement or arrangement, (v) the Investor
understands that the Notes cannot be sold or transferred without the prior
written consent of the Company, (vi) there will be no public market for the
Notes, (vii) any disposition of the Notes may result in unfavorable tax
consequences to the Investor, (viii) the Company does not have any obligation
or intention to register the Notes for sale under the Securities Act, any state
securities laws or of supplying the information that may be necessary to enable
the Investor to sell Notes and (ix) Investors have no right to require the
registration of the Notes under the Securities Act or state securities laws or
other applicable securities regulations.

 

(d)           The Investor is
aware and acknowledges that (i) the Notes involve a substantial degree of risk
of loss of the Investor’s entire investment and there is no assurance of any
income from such investment, (ii) the Investor, in making his investment, is
relying, if at all, solely upon the advice of his personal advisors with
respect to an investment in the Notes and (iii) because there are substantial
restrictions on the transferability of the Notes, it may not be possible for
the undersigned to liquidate his investment readily in case of an emergency.

 

(e)           All information
provided to the Company as to net worth and annual income or assets of the
Investor and the other information about the Investor are true, correct and
complete in all material respects.

 

(f)            The Investor is at
least 21 years of age and the Investor has adequate means of providing for all
his current and foreseeable needs and personal contingencies and has no need
for liquidity in this investment.

 

(g)           The Investor has
evaluated the risks of investing in the Notes and has determined that the Notes
are a suitable investment for the Investor. 
The Investor can bear the economic risk of this investment and can
afford a complete loss of his investment. 
In evaluating the suitability of an investment in the Notes, the
Investor has not relied upon any representations or other information (whether
oral or written) other than as set forth in the Note Document and the SEC
Filings and independent investigations made by the Investor or
representative(s) of the Investor.

 

(h)           The Investor is
knowledgeable and experienced in evaluating investments and experienced in
financial and business matters and is capable of evaluating the merits and
risks of investing in the Notes. The aggregate amount of the investments of the
Investor in, and his commitments to, all similar investments that are illiquid
is reasonable in relation to his net worth.

 

(i)            The Investor
maintains his domicile, and is not merely a transient or temporary resident, at
the residence address shown on the signature page of this Subscription
Agreement.

 

(j)            Any information
that the Investor has heretofore furnished to the Company with respect to the
Investor is correct and complete as of the date of this Agreement and if there
should be any material change in such information prior to its purchase of the
Notes, the Investor shall immediately furnish such revised or corrected
information to the Company.

 

(k)           The representations,
warranties, agreements, undertakings and acknowledgments made by the Investor
in this Agreement are made with the intent that they be relied upon by the
Company in determining his suitability as a purchaser of the Notes and shall
survive its purchase. In addition, the Investor undertakes to notify the
Company immediately of any change in any representation, warranty or other
information relating to the Investor set forth herein.

 

3

 

(l)            The investor is a
United States citizen if an individual, and if an entity is organized under the
laws of the United States or a state thereof.

 

4.             Indemnification.
The Investor recognizes that the offer of the Notes to him was made in reliance
upon his representations and warranties set forth in Paragraph 3 and the
acknowledgments and agreements set forth in Paragraph 2 above. The Investor
agrees to provide, if requested, any additional information that may reasonably
be required to determine the eligibility of the Investor to purchase the Notes.
The investor hereby agrees to indemnify the Company and any affiliates and to
hold each of them harmless from and against any loss, damage or liability due
to or arising out of a breach of any representation, warranty or agreement of
the Investor contained in this Subscription Agreement or in any other document
provided by the Investor to the Company in connection with the Investor’s
investment in the Notes. The Investor hereby agrees to indemnify the Company
and any affiliates, and to hold them harmless against all liabilities, costs or
expenses (including reasonable attorneys’ fees) arising as a result of the sale
or distribution of the Notes by the Investor in violation of the Securities Act
or other applicable law or any misrepresentation or breach by the Investor with
respect to the matters set forth herein. In addition, the Investor agrees to
indemnify the Company and any affiliates and to hold such persons and firms
harmless from and against, any and all loss, damage, liability or expense,
including costs and reasonable attorneys’ fees, to which they may be put or
that they may incur or sustain by reason of or in connection with any
misrepresentation made by the Investor with respect to the matters about which
representations and warranties are required by the terms of this Subscription
Agreement, or any breach of any such warranties or any failure to fulfill any covenants
or agreements set forth herein.

 

5.             Arbitration.
Any claim, controversy, dispute or deadlock arising under this agreement
(collectively, a “Dispute”) shall be settled by arbitration administered under
the rules of the American Arbitration Association (“AAA”) in Denver, Colorado.
Any arbitration and award of the arbitrators, or a majority of them, shall be
final and the judgment upon the award rendered may be entered in any state or
federal court having jurisdiction. No punitive damages are to be awarded.

 

Any Dispute shall be heard by three arbitrators of which each party
shall select one within 10 days of the demand for arbitration. The two
party-appointed arbitrators shall select a third arbitrator to serve as chair
of the tribunal within 10 days of the selection of the second arbitrator. If
any arbitrator has not been appointed within the time limits specified herein,
such appointment shall be made by the AAA upon the written request of either
party within 10 days of the request.

 

6.             General. This
Agreement (i) shall be binding upon the Investor and the heirs, personal
representatives, successors and assigns of the Investor, (ii) shall be
governed, construed and enforced in accordance with the laws of the State of
Colorado, without reference to any principles of conflicts of law (except
insofar as affected by the state securities or “blue sky” laws of the
jurisdiction in which the offering described herein has been made to the
Investor), (iii) shall survive the purchase of the Notes by the Investor and
(iv) shall, if the Investor consists of more than one person, be the joint and
several obligation of all such persons.

 

7.             Assignment.
The Investor agrees that neither this Subscription Agreement nor any rights
that may accrue to him hereunder may be transferred or assigned.

 

The undersigned Investor has executed this Subscription Agreement.

 

	
   

  	
   

  
	
  Subscriber Name (Please
  print)

  	
   

  

 

4

 

	
   

  	
   

  
	
  Residence or Office
  Address

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  City, State, Zip Code

  	
   

  

 

(Fill in Mailing Address
only if different from Residence or Office Address):

 

	
   

  	
   

  
	
  Mailing Address

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  City, State, Zip Code

  	
   

  
	
   

  	
   

  
	
  Business Telephone:

  	
   

  	
   

  
	
   

  	
   

  
	
  Facsimile (Home/Business):

  	
   

  	
   

  
	
   

  	
   

  
	
  Internet Address:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Signature of Subscriber

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   Capacity (Title) of Subscriber, if
  applicable

  	
   

  
							

 

	
   

  	
   

  
	
  Total Note purchase:  $             

  	
   

  
	
   

  	
   

  
	
  Paid by check or wire (circle one)

  	
   

  
	
   

  	
   

  
	
  Date of execution by
  Subscriber:

  	
   

  	
   

  
	
   

  	
   

  
	
  Social Security or
  Taxpayer I.D. No. of Subscriber [Must be completed]:

  	
   

  	
   

  
				

 

5

 

	
  The above and foregoing
  subscription is accepted this          
  day of            ,
  2006.

  	
   

  
	
   

  	
   

  
	
  PRB GAS TRANSPORTATION,
  INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Robert W. Wright, Chief Executive Officer

  	
   

  	
   

  

 

6

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