Document:

Exhibit 10.3

 

 

 

 

 

 

REGISTRATION RIGHTS AGREEMENT

 

AMONG

 

HORIZON OFFSHORE, INC.

 

AND

 

THE INITIAL HOLDERS LISTED ON

THE SIGNATURE PAGES HEREOF

 

 

 

 

 

 

Dated as of April 30, 2005

 

 

 

 

 

TABLE OF CONTENTS

Page

	SECTION 1. Definitions	1
	SECTION 2. Registration of Securities by the Company	4
	SECTION 3. Registration Expenses	13
	SECTION 4. Conditions to Registration	14
	SECTION 5. Indemnification	15
	SECTION 6. Exchange Act Registration; Rule 144 Reporting	18
	SECTION 7. Limitation on Registration
	Rights of Others	19
	SECTION 8. Mergers, etc.	19
	SECTION 9. Notices, etc.	19
	SECTION 10. Entire Agreement	20
	SECTION 11. Amendments; Waivers and
	Further Agreements	20
	SECTION 12. Assignment; Successors and Assigns	21
	SECTION 13. Severability	21
	SECTION 14. Counterparts	21
	SECTION 15. Gender; Usage	21
	SECTION 16. Governing Law	22
	SECTION 17. Survival	22
	SECTION 18. Expenses	22
	SECTION 19. Specific Performance	22

 

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REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement")
is made and entered into as of April 30, 2005 and effective as of the date of
the consummation of the Exchange Transaction (as defined below) (the "Effective
Date") by and among HORIZON OFFSHORE, INC., a Delaware corporation (the "Company"),
and the initial holders listed on the signature pages hereof (collectively, the
"Initial Holders").

W I T N E S S E T H:

RECITALS.

A.     On March 31, 2005, the Company and the Initial Holders
entered that certain recapitalization letter agreement (the "Recap Letter
Agreement") pursuant to which the Company agreed to issue to the Holders 60
million shares of Common Stock and one million shares of Series B Preferred
Stock in exchange for $84,972,823 aggregate principal amount of the Company's
16% and 18% Subordinated Secured Notes due March 31, 2007 and all of the
outstanding shares of the Company's Series A Redeemable Participating Preferred
Stock, par value $1.00 per share, and other additional consideration as provided
in the Recap Letter Agreement (the "Exchange Transaction");

B.     It is a condition precedent to the consummation of the
Exchange Transaction that the Company execute and deliver this Agreement; and

C.     The Initial Holders are unwilling to consummate the
Exchange Transaction unless they receive the assurances set forth in this
Agreement;

NOW, THEREFORE, in consideration of the recitals, of the
Initial Holders proceeding with the consummation of the Exchange Transaction,
and the mutual covenants hereinafter set forth, the parties, intending to be
legally bound, hereby agree as follows:

SECTION 1.   
Definitions. 

(a)    Defined Terms.  The following
                  terms (whether or not underscored) when used in this
                  Agreement, including its preamble and recitals, shall, except
                  where the context otherwise requires, have the following
                  meanings (such meanings to be equally applicable to the
                  singular and plural forms thereof): 

"Agreement" means this Registration Rights Agreement
as in effect on the date hereof and as hereafter amended, supplemented, restated
or otherwise modified.

"Available Securities" is defined in Section 2(b).

"Business Day" means any day which is neither a
Saturday, a Sunday nor a legal holiday on which banks are authorized or required
to be closed in New York, New York.

"Common Stock" means the Common Stock, par value $1.00
per share, of the Company.

 

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"Company" is defined in the preamble to this
Agreement.

"Conversion Share Registration Period" is defined in
Section 2(a).

"Conversion Share Shelf Registration" is defined in
Section 2(a).

"Conversion Shares" means the shares of Common Stock
or any other securities which a Holder may acquire upon conversion of Series B
Preferred Shares, together with any other securities which a Holder may acquire
on account of any Conversion Shares whether upon the making or paying of any
dividend or other distribution on Conversion Shares, upon any split up of
Conversion Shares, upon a recapitalization, merger, consolidation, share
exchange, reorganization or other transaction or series of related transactions
in which Conversion Shares are changed into or exchanged for securities of
another corporation, upon exercise of any preemptive right (or the exercise or
conversion of any security which such Holder may acquire in connection with the
exercise of any preemptive right) with respect to any Conversion Shares or
otherwise.

"Effective Date" is defined in the preamble to this
Agreement.

"Exchange Act" means the Securities Exchange Act of
1934, as amended from time to time.

"Exchange Transaction" is defined in the recitals to
this Agreement.

"Holders" means, collectively, the registered holders
(including, initially, the Initial Holders), from time to time, of Securities.
Whenever the phrase "Holder of Registrable Securities" or any similar phrase is
used herein, it shall also include any holders of the Series B Preferred Shares.

"Indemnified Person" is defined in Section 5(a).

"Indemnifying Person" is defined in Section 5(c).

"Initial Holders" is defined in the preamble to this
Agreement.

"Initial Registration Period" is defined in Section
2(a).

"Initial Request" is defined in Section 2(a).

"Initial Requesting Holders" is
defined in Section 2(a).

"Initial Shares" means the 60,000,000 shares of Common
Stock issued to the Initial Holders in the Exchange Transaction, together with
any other securities which a Holder may acquire on account of any Initial Shares
whether upon the making or paying of any dividend or other distribution on
Initial Shares, upon any split up of Initial Shares, upon a recapitalization,
merger, consolidation, share exchange, reorganization or other transaction or
series of related transactions in which Initial Shares are changed into or
exchanged for securities of another corporation, upon exercise of any preemptive
right (or the exercise or conversion of any security which such Holder may
acquire in connection with the exercise of any preemptive right) with respect to
any Initial Shares or otherwise.

 

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"Initial Shelf Registration" is defined in Section
2(a).

"NASD" means the National Association of Securities
Dealers, Inc.

"Person" means any natural
person, corporation, partnership, limited liability company, firm, association,
government, governmental agency or any other entity, whether acting in an
individual, fiduciary or other capacity.

"Prospectus" means each prospectus included as part of
any Registration Statement, as amended or supplemented, including each
preliminary prospectus and all material incorporated by reference in such
prospectus.

"Recap Letter Agreement" is defined in the Recitals.

"Registrable Securities" means the Shares, but
excluding (i) Shares that have been disposed of under a Registration Statement
or any other effective registration statement, including in a transaction
contemplated by Section 8, and (ii) Shares sold pursuant to Rule 144 under the
Securities Act. A Person is deemed to be a holder of Registrable Securities
whenever such Person owns Registrable Securities or has the right to acquire
such Registrable Securities whether or not such acquisition has actually been
effected and disregarding any legal or contractual restrictions upon the
exercise of such right.

"Registration Expenses" is defined in Section 3(c).

"Registration Period" means the Conversion Share
Registration Period or the Initial Registration Period.

"Registration Request" is defined in Section 2(b).

"Registration Statement" means any registration
statement of the Company which covers Registrable Securities pursuant to Section
2 of this Agreement, including the Prospectus, amendments (including
post-effective amendments) and supplements to such registration statement and
Prospectus and all exhibits and all material incorporated by reference in such
registration statement.

"Required Holders" means the Holders of Registrable
Securities representing (or Series B Preferred Shares which when fully converted
would represent) at least two-thirds of the voting power of all Shares (assuming
all Series B Preferred Shares had been fully converted
into Conversion Shares).

"SEC" means the United States Securities and Exchange
Commission.

"Secondary Request" is defined in Section 2(a).

 

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"Securities" means, collectively, the Series B
Preferred Shares and the Registrable Securities.

"Securities Act" means the Securities Act of 1933, as
amended from time to time.

"Series B Preferred Shares" means the 1,000,000 shares
of Series B Preferred Stock issued to the Initial Holders in the Exchange
Transaction, together with any other securities which a Holder may acquire on
account of any Series B Preferred Shares whether upon the making or paying of
any dividend or other distribution on Series B Preferred Shares, upon any split
up of Series B Preferred Shares, upon a recapitalization, merger, consolidation,
share exchange, reorganization or other transaction or series of related
transactions in which Series B Preferred Shares are changed into or exchanged
for securities of another corporation, upon exercise of any preemptive right (or
the exercise or conversion of any security which such Holder may acquire in
connection with the exercise of any preemptive right) with respect to any Series
B Preferred Shares or otherwise.

"Series B Preferred Stock" means the Series B Mandatorily
Convertible Redeemable Preferred Stock, par value $1.00 per share, of the
Company.

"Shares" means the Initial Shares and the Conversion
Shares.

"Shelf Registration" is defined in Section 2(a).

"Specified Registrable Securities" is defined in
Section 2(a).

"Stock" means any capital stock of the Company.

"Subsequent Registration Period" is defined in Section
2(c)(iv).

"Subsequent Shelf Registration" is defined in Section
2(c)(iv).

(b)    Cross-References;
      Headings.  Unless otherwise specified, references in this Agreement to
      any Article or Section are references to such Article or Section of this
      Agreement, and unless otherwise specified, references in any Article,
      Section or definition to any clause are references to such clause of such
      Section, Article or definition. The headings contained in this Agreement
      are for reference purposes only and shall not in any way affect the
      meaning or interpretation of this Agreement. The term "or" shall have the
      inclusive meaning of the term "and/or."

SECTION 2.   
Registration of Securities by the
                Company. 

(a)    Shelf Registration. As expeditiously as practicable
                  after the Effective Date, but in no event later than 60 days
                  thereafter, the Company will file a "shelf" registration
                  statement on Form S-1, S-2 or S-3 (or on any other form for
                  general registration of securities) unless the use of a
                  different form has been agreed upon in writing by the Company
                  and the Required Holders for an offering to be made on a
                  continuous basis pursuant to Rule 415 under the Securities Act
                  (or any similar rule that may be adopted by the SEC) covering
                  the Registrable Securities that are Initial Shares (the "Initial
                  Shelf Registration").

 

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The Company shall use its best efforts to have the Initial
Shelf Registration declared effective no later than 120 days after the Initial
Shelf Registration is filed with the SEC and to keep the Initial Shelf
Registration continuously effective until such date that all Initial Shares have
been sold pursuant to the Initial Shelf Registration (such period hereinafter
referred to as the "Initial Registration Period").

As expeditiously as practicable after the conversion of the
Series B Preferred Stock into the Conversion Shares, but in no event later than
15 days thereafter, the Company will file a "shelf" registration statement on
Form S-1, S-2 or S-3 (or on any other form for the general registration of
securities) unless the use of a different form has been agreed upon in writing
by the Company and the Required Holders for an offering to be made on a
continuous basis pursuant to Rule 415 under the Securities Act (or any similar
rule that may be adopted by the SEC) covering all Registrable Securities that
are Conversion Shares (a "Conversion Share Shelf Registration" and the
Conversion Share Shelf Registration and the Initial Shelf Registration are
hereinafter referred to as a "Shelf Registration"). The Company shall use
its best efforts to have the Conversion Share Shelf Registration declared
effective no later than 120 days after such Conversion Share Shelf Registration
is filed with the SEC and to keep it continuously effective until such date that
all Conversion Shares have been sold pursuant to the Conversion Share Shelf
Registration (such period hereinafter referred to as a "Conversion Share
Registration Period"). The Company shall not include or permit any other
party to include any securities other than Registrable Securities in any Shelf
Registration without the written consent of the Required Holders.

If any Registrable Securities are to be sold in a firm
commitment underwritten offering and if the managing underwriter or underwriters
shall advise the Company and the holders of such Registrable Securities in
writing that in their opinion the amount of Registrable Securities requested to
be included in such registration exceeds the amount of securities which can be
included in such offering without materially adversely affecting the success of
such offering, there shall be included in such firm commitment underwritten
offering the amount of Registrable Securities which in the opinion of such
underwriter or underwriters can be sold, and such Registrable Securities shall
be allocated pro rata among the holders of such Registrable
Securities on the basis of the amount of Registrable Securities requested to be
included in such registration statement by such holders and the amount of
Registrable Securities which in the opinion of such underwriter or underwriters
can be sold. If any Registrable Securities covered by a Shelf Registration are
to be sold in an underwritten offering, the investment banker or investment
bankers and manager or managers that will administer the offering will be
selected by the Company and shall be reasonably acceptable to holders of a
majority of such Registrable Securities included in such offering.

The Company agrees to supplement or make amendments to each
Shelf Registration, if required by the registration form utilized by the Company
for such Shelf Registration or by the instructions applicable to such
registration form or by the Securities Act or the rules and regulations
thereunder or if reasonably requested by the holders of (or any underwriter for)
a majority in aggregate amount of Registrable Securities to which such Shelf
Registration relates, and the Company agrees to furnish to such holders copies
of any such supplement or amendment prior to its being used or filed with the
SEC. 

 

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If the Company has filed a "shelf" Registration Statement on
Form S-1 or S-2 (or on any other form for the general registration of
securities) pursuant to this Section 2(a) because Form S-3 was not available for
use by the Company at the time of such filing, the Company shall undertake to
cause the Registration Statement for the Shelf Registration to be on Form S-3 as
soon as such form is available for use by the Company to register the
Registrable Securities for an offering to be made on a continuous basis pursuant
to Rule 415 under the Securities Act (including by filing a post-effective
amendment on Form S-3 to the then existing Shelf Registration), and, to the
extent the Company seeks to cause the Registration Statement for the Shelf
Registration to be on Form S-3 by filing a new Shelf Registration, the Company
shall maintain the effectiveness of the Shelf Registration then in effect until
such time as such Shelf Registration on Form S-3 has been declared effective by
the SEC.

(b)   
      
      Piggyback Registration.  If at any time or from time to time the
      Company shall propose to file on its behalf or on behalf of any of its
      security holders a registration statement under the Securities Act on Form
      S-1, S-2 or S-3 (or on any other form for the general registration of
      securities) with respect to any shares of Common Stock (other than
      pursuant to Section 2(a)), the Company shall in each case: 

(i)   
promptly give written notice to each Holder
        at least thirty (30) days before the anticipated filing date, indicating
        the proposed offering price and describing the plan of distribution;

(ii)   
include in such registration (and any related
        qualification under blue sky or other state securities laws or other
        compliance) and, at the request of any Holder, in any underwriting
        involved therein, all the Registrable Securities specified by any Holder
        or Holders of Registrable Securities (the "Specified Registrable
        Securities") in a written request (the "Registration Request")
        delivered to the Company within twenty (20) days after receipt of such
        written notice from the Company; and

(iii)   
if such offering is proposed to be
        underwritten, use its best efforts to cause the managing underwriter(s)
        of such proposed underwritten offering to permit the Specified
        Registrable Securities to be included in the Registration Statement for
        such offering on the same terms and conditions as any similar securities
        of the Company included therein. 

Notwithstanding the foregoing, if the managing underwriter(s)
of such an underwritten offering advise(s) the Holders of Specified Registrable
Securities in writing that marketing considerations require a limitation on the
securities, other than the securities the Company intends to sell, to be
included in any Registration Statement filed under this Section 2(b) to a
certain number of shares (the "Available Securities"), then the Company
shall in such case be obligated to such Holders only with respect to such number
of Available Securities. The limitation on the number of Specified Registrable
Securities will be imposed pro rata (based upon the ratio of the number of
shares of Specified Registrable Securities which the managing underwriter(s)
propose(s) to include at the anticipated offering price to the number of
Specified Registrable Securities requested to be included in such registration
by each Holder) among all Holders of Specified Registrable Securities.

 

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Each Registration Request shall set forth the number or
amount of Specified Registrable Securities. Except as provided by Section 2(a),
notwithstanding any other provision of this Agreement to the contrary, neither
the delivery of any notice by the Company pursuant to this Section 2(b)(i) nor
of any Registration Request by any Holder pursuant to this Section 2(b)(ii)
shall in any way obligate the Company to file a Registration Statement and,
notwithstanding such filing, the Company may, at any time prior to the effective
date thereof, in its sole discretion, determine not to offer the securities to
which the Registration Statement relates without liability to any of the
Holders. No registration of Registrable Securities effected under this Section
2(b) shall relieve the Company of its obligation to effect the registration of
Registrable Securities pursuant to Section 2(a).

(c)    Registration Procedures.  If and when the
      Company shall be required by the provisions of this Section 2 to effect
      the registration of Registrable Securities under the Securities Act, the
      Company will use its best efforts to effect such registration to permit
      the sale of such Registrable Securities in accordance with the intended
      method or methods of disposition thereof and in accordance with Section
      2(a) or 2(b), as applicable, and pursuant thereto the Company will, as
      expeditiously as possible: 

(i)   
before filing with the SEC a Registration
        Statement or Prospectus or any amendments or supplements thereto,
        furnish to the Holders of the Registrable Securities covered by such
        Registration Statement and the underwriter(s), if any, copies of all
        such documents proposed to be filed, which documents will be made
        available, on a timely basis, for review by such Holders and
        underwriters;

(ii)   
prepare and, as expeditiously as possible but
        in any event within the applicable periods specified in Section 2(a),
        file with the SEC a Registration Statement and Prospectus covering such
        Registrable Securities; prepare and file such amendments and
        post-effective amendments to any Registration Statement, and such
        supplements to the Prospectus, as may be reasonably requested by any
        Holder of Registrable Securities or the managing underwriter(s), if any,
        or as may be required by the Securities Act, the Exchange Act or by the
        rules, regulations or instructions applicable to the registration form
        utilized by the Company or as may otherwise be necessary to cause such
        Registration Statement to become effective or to keep such Registration
        Statement effective until such time as all of the Registrable Securities
        covered by such Registration Statement have been disposed of in
        accordance with the intended method or methods of disposition set forth
        in such Registration Statement or Prospectus; and cause the Prospectus
        as so supplemented to be filed pursuant to Rule 424 (or any successor
        rule) under the Securities Act; and comply with the provisions of the
        Securities Act with respect to the disposition of all securities covered
        by such Registration Statement during the applicable period in
        accordance with the intended method or methods of disposition by the
        Holders thereof set forth in such Registration Statement or Prospectus;

(iii)   
promptly notify the selling Holders of
        Registrable Securities and the managing underwriter(s), if any, and if
        requested by any such Person, confirm such advice in writing: 

 

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(a)    of the filing of the Prospectus or any supplement to the
          Prospectus and of the effectiveness of any Registration Statement
          and/or any post-effective amendment,

(b)    of any request by the SEC for amendments or supplements to such
          Registration Statement or the Prospectus or for additional
          information,

(c)    of the issuance by the SEC of any stop order suspending the
          effectiveness of such Registration Statement or the initiation of any
          proceedings for that purpose,

(d)    of the Company's becoming aware at any time that the
          representations and warranties of the Company contemplated by Section
          2(c)(xiv)(a) have ceased to be true and correct,

(e)    of the receipt by the Company of any notification with respect to
          the suspension of the qualification of the Registrable Securities for
          sale in any jurisdiction or the initiation or threat of any proceeding
          for such purpose, and

(f)    of the existence of any fact which, to the knowledge of the
          Company, results in the Registration Statement, the Prospectus or any
          document incorporated therein by reference containing an untrue
          statement of material fact or omitting to state a material fact
          required to be stated therein or necessary to make the statements
          therein not misleading,

(iv)    make every reasonable effort to obtain the
        withdrawal of any order suspending the effectiveness of any Registration
        Statement, and if such withdrawal is not obtained within 30 days of the
        suspension of the effectiveness of such Registration Statement, the
        Company shall (A) as expeditiously as practicable cause to be filed an
        additional "shelf" registration statement pursuant to Rule 415 under the
        Securities Act (and/or any similar rule that may be adopted by the SEC)
        with respect to the Registrable Securities registered under such
        Registration Statement (the "Subsequent Shelf Registration"), and
        (B) use its best efforts to have the Subsequent Shelf Registration
        declared effective as soon as practicable after such filing and to keep
        the Subsequent Shelf Registration continuously effective until such date
        that all Registrable Securities registered thereunder have been sold
        pursuant to the Subsequent Shelf Registration (as used herein the term "Registration
        Statement" and "Shelf Registration" includes any Subsequent
        Shelf Registrations); 

(v)    make every reasonable effort to obtain any qualification referred to
        in Section 2(c)(iii)(e) at the earliest possible moment;

(vi)   
if reasonably requested by the managing
        underwriter(s) or the Required Holders of the Registrable Securities
        being sold in connection with an underwritten offering, immediately
        incorporate in a supplement to the Prospectus or post-effective
        amendment to the Registration Statement such information as the managing
        underwriter(s) or the Required Holders of the Registrable Securities
        being sold reasonably request to have included therein relating to the
        plan of distribution with respect to such Registrable Securities,
        including, without limitation, information with respect to the amount of
        Registrable Securities being sold to such underwriters, the purchase
        price being paid therefor by such underwriters and any other terms of
        the underwritten offering of the Registrable Securities to be sold in
        such offering; and make all required filings of such supplement to the
        Prospectus or post effective amendment to the Registration Statement as
        soon as notified of the matters to be incorporated in such supplement to
        the Prospectus or post-effective amendment to the Registration
        Statement;

 

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(vii)   
at the request of any selling Holder of
        Registrable Securities, furnish to such selling Holder of Registrable
        Securities and the managing underwriter(s), if any, without charge, at
        least one signed copy of the Registration Statement and any
        post-effective amendment thereto, including financial statements and
        schedules, all documents incorporated therein by reference and all
        exhibits thereto (including those incorporated by reference);

(viii)   
deliver to each selling Holder of Registrable
        Securities and the managing underwriter(s), if any, without charge, as
        many copies of the Registration Statement, each Prospectus (including
        each preliminary prospectus) and any amendment or supplement thereto (in
        each case including all exhibits), as such Persons may reasonably
        request, together with all documents incorporated by reference in such
        Registration Statement or Prospectus, and such other documents as such
        selling Holder may reasonably request in order to facilitate the
        disposition of its Registrable Securities covered by such Registration
        Statement; the Company consents to the use of each Prospectus and any
        supplement thereto by each of the selling Holders of Registrable
        Securities and the managing underwriter(s), if any, in connection with
        the offering and sale of the Registrable Securities covered by each
        Prospectus or any amendment or supplement thereto;

(ix)   
prior to any public offering of Registrable
        Securities, register or qualify or reasonably cooperate with the selling
        Holders of Registrable Securities, the managing underwriter(s), if any,
        and their respective 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 as any selling
        Holder or managing underwriter(s) reasonably request(s), to keep such
        registration or qualification in effect for so long as such registration
        remains in effect, and do any and all other acts or things necessary or
        advisable to enable the disposition in such jurisdictions of the
        Registrable Securities covered by the Registration Statement, except
        that the Company shall not be required to register or qualify such
        Registrable Securities under such other securities or blue sky laws if
        it is required to (A) qualify generally to do business as a foreign
        corporation in any jurisdiction wherein it would not otherwise be
        required to qualify but for the requirements of this paragraph (viii),
        (B) subject itself to taxation in any such jurisdiction or (C) consent
        to general service of process in any such jurisdiction;

 

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(x)   
cooperate with the selling Holders of
        Registrable Securities and the managing underwriter(s), if any, to
        facilitate the timely preparation and delivery of certificates
        representing Registrable Securities to be sold and not bearing any
        legends restricting the transfer thereof; and enable such Registrable
        Securities to be in such denominations and registered in such names as
        the managing underwriters may request at least two Business Days prior
        to any sale of Registrable Securities to the underwriters;

(xi)   
use its best efforts to cause the Registrable
        Securities covered by the applicable Registration Statement to be
        registered with or approved by such United States, state and local
        governmental agencies or authorities as may be necessary to enable the
        seller or sellers thereof or the underwriters, if any, to consummate the
        disposition of such Registrable Securities;

(xii)   
if any fact contemplated by Section 2(c)(iii)(b)
        or Section 2(c)(iii)(f) above shall exist, promptly notify each Holder
        on whose behalf Registrable Securities have been registered and promptly
        prepare and furnish to such Holders a supplement or post-effective
        amendment to the Registration Statement or the related Prospectus or any
        document incorporated therein by reference and promptly file any other
        required document so that, as thereafter delivered to the purchasers of
        the Registrable Securities, neither the Registration Statement nor the
        Prospectus will contain an untrue statement of a material fact or omit
        to state any material fact required to be stated therein or necessary to
        make the statements therein not misleading; provided; however,
        that if the Company shall furnish to the Requesting Holders a
        certificate signed by the Company's Chairman of the Board stating that
        in his good faith judgment such actions would be detrimental or
        otherwise disadvantageous to the Company or its stockholders, the
        Company may delay such actions for as short a period as reasonably
        necessary to remove such detrimental condition, not to exceed 30 days in
        any instance.

(xiii)   
cause all Registrable Securities covered by
        the Registration Statement to be (A) listed on each securities exchange
        on which securities of the same class are then listed or (B) admitted
        for trading in any inter-dealer quotation system on which securities of
        the same class are then traded;

(xiv)   
not later than the effective date of the
        applicable Registration Statement, provide a CUSIP number for all
        Registrable Securities covered by the Registration Statement and provide
        the applicable transfer agent with printed certificates for such
        Registrable Securities which are in a form eligible for deposit with The
        Depository Trust Company;

(xv)   
enter into customary agreements (including
        underwriting agreements) and take all other reasonable actions in order
        to expedite or facilitate the disposition of such Registrable
        Securities; and in such connection, except as otherwise provided:

(a)    in an underwritten offering, make such representations and
          warranties to the Holders selling such Registrable Securities and the
          underwriters, in form, substance and scope as are customarily made by
          issuers to selling securityholders and underwriters in similar
          underwritten offerings;

 

10

 

(b)    obtain opinions of counsel to the Company and updates thereof
          addressed to each selling Holder and the underwriters, if any,
          covering the matters customarily covered in opinions requested in
          similar underwritten offerings and such other matters as may be
          reasonably requested by such Holders and underwriters, which counsel
          and opinions shall be reasonably satisfactory (in form, scope and
          substance) to the managing underwriters, if any, and the Required
          Holders of the Registrable Securities being sold;

(c)    in connection with any underwritten offering, obtain so called
          "cold comfort" letters and updates thereof from the Company's
          independent certified public accountants addressed to the selling
          Holders of Registrable Securities and the underwriters, such letters
          to be in customary form and covering matters of the type customarily
          covered in "cold comfort" letters to underwriters in connection with
          similar underwritten offerings;

(d)    if an underwriting agreement is entered into, cause the same to
          include indemnification and contribution provisions and procedures
          substantially similar to those set forth in Section 5, subject to
          revisions the underwriters shall reasonably request, with respect to
          all parties to be indemnified pursuant to said Section 5; and

(e)    deliver such documents and certificates as may reasonably be
          requested by the Required Holders of the Registrable Securities being
          sold, or the managing underwriter(s), if any, to evidence compliance
          with this paragraph (xiv) and with any customary conditions contained
          in the underwriting agreement or other agreement entered into by the
          Company;

the foregoing to be done upon each closing under any
        underwriting or similar agreement as and to the extent required
        thereunder and from time to time as may reasonably be requested by any
        selling Holder of Registrable Securities in connection with the
        disposition of Registrable Securities pursuant to such Registration
        Statement, all in a manner consistent with customary industry practice;

(xvi)   
upon execution and delivery of such
        confidentiality agreements as the Company may reasonably request, make
        available to the Holders of the Registrable Securities being sold, any
        underwriter participating in any disposition pursuant to such
        Registration Statement, and any attorney or accountant retained by such
        Holders or underwriter, all financial and other records, pertinent
        corporate documents and properties of the Company, and cause the
        Company's officers, directors and employees to supply all information
        reasonably requested by any such Holder, underwriter, attorney or
        accountant in connection with the registration, at such time or times as
        the Person requesting such information shall reasonably determine;

 

11

 

(xvii)   
otherwise use its best efforts to comply with
        the Securities Act, the Exchange Act, all applicable rules and
        regulations of the SEC and all applicable state blue sky and other
        securities laws, rules and regulations, and make generally available to
        its security holders an earnings statement satisfying the provisions of
        Section 11(a) of the Securities Act, as soon as practicable, but in no
        event later than thirty (30) days after the end of the 12 calendar month
        period commencing after the effective date of the Registration
        Statement;

(xviii)   
cooperate and assist in any filings required
        to be made with the NASD and in the performance of any due diligence
        investigation by any underwriter; and

(xix)   
prior to the filing of any document which is
        being prepared for incorporation by reference into the Registration
        Statement or the Prospectus (other than a Registration Statement or
        Prospectus relating to a "shelf" offering) , upon receipt of such
        confidentiality agreements as the Company may reasonably request,
        provide copies of such document to counsel to the selling Holders of
        Registrable Securities, and to the managing underwriter(s), if any, and
        make the Company's representatives available for discussion of such
        document.

(d)    Restrictions on Public Sale by Holder of Registrable Securities.
      If any of the Registrable Securities registered pursuant to a Shelf
      Registration are to be sold in a firm commitment underwritten offering,
      each holder of Registrable Securities whose Registrable Securities are
      covered by the Shelf Registration filed pursuant to Section 2(a) and who
      has been given the opportunity (subject to the fifth paragraph of Section
      2(a)) to participate in such offering at least 10 Business Days in advance
      of the commencement of such offering agrees, if requested by the managing
      underwriter or underwriters in such underwritten offering, not to effect
      any public sale or distribution of any of the Company's securities,
      including a sale pursuant to Rule 144 under the Securities Act (except as
      part of such offering) during the 10-day period prior to, and during the
      60-day period beginning on, the closing date of such offering made
      pursuant to such Shelf Registration, to the extent timely notified in
      writing by the Company or the managing underwriter or underwriters. In
      addition, if any registration of Common Stock to be sold on the behalf of
      the Company shall be in connection with an underwritten public offering
      and is subject to Section 2(b) (and the Company has complied with Section
      2(b) in respect thereof) and such registration is approved by the Required
      Holders, any Holder of Registrable Securities representing more than 5% of
      the outstanding Common Stock shall (i) not effect any public sale or
      distribution of any of the Company's securities, including a sale pursuant
      to Rule 144 under the Securities Act (except as part of such offering)
      during the 10-day period prior to, and during the 90-day period beginning
      on, the closing date of the sale of the Common Stock pursuant to an
      effective registration statement, to the extent timely notified in writing
      by the Company or the managing underwriter or underwriters of such
      underwritten public offering, and (ii) execute a "lock-up" letter with any
      of such underwriters agreeing to not effect any such public sale or
      distribution. 

(e)    Restrictions on Registration by the Company and Others. If any of
      the Registrable Securities registered pursuant to a Shelf Registration are
      to be sold in a firm commitment underwritten offering, during the 10-day
      period prior to, and during the 90-day period beginning on, the closing
      date of such offering, the Company will not effect any other registration
      of its Common Stock (or any securities convertible into or exchangeable or
      exercisable for its Common Stock), whether for its own account or that of
      any other security holder.

 

12

 

SECTION 3.   
Registration Expenses.

(a)    All expenses incident to the
                  Company's performance of or compliance with its obligations
                  under this Agreement (excluding underwriting discounts,
                  selling commissions and brokerage fees, which will be paid by
                  the selling Holders) will be paid by the Company, regardless
                  of whether Registrable Securities are sold pursuant to any
                  Registration Statement, including, without limitation: 

(i)   
all registration, filing and
                    listing fees;

(ii)   
fees and expenses of compliance
                    with securities or blue sky laws (including, without
                    limitation, the fees and disbursements of counsel for the
                    underwriters, if any, or selling Holders in connection with
                    blue sky and state securities qualifications of Registrable
                    Securities and determination of their eligibility for
                    investment under the laws of such jurisdictions as the
                    managing underwriter(s), if any, or the Required Holders of
                    the Registrable Securities covered by such Registration
                    Statement may reasonably designate);

(iii)   
printing (including, without
                    limitation, expenses of printing or engraving certificates
                    for the Registrable Securities in a form eligible for
                    deposit with The Depository Trust Company and of printing
                    prospectuses), word processing, duplicating, messenger,
                    telephone and delivery expenses;

(iv)   
fees and disbursements of counsel
                    for the Company and, subject to Section 3(b), counsel
                    for the selling Holders of the Registrable Securities;

(v)   
fees and disbursements of all
                    independent certified public accountants of the Company or
                    any other Persons for which financial statements are
                    required or otherwise included in such Registration
                    Statement (including, without limitation, the expenses of
                    any special audit and, in connection with any underwritten
                    offering, "cold comfort" letters required by or incident to
                    such performance);

(vi)   
fees and expenses of other
                    Persons (including special experts) retained by the Company;
                    and

(vii)   
fees and expenses associated with
                    any NASD filing required to be made in connection with any
                    Registration Statement.

The Company will, in any event, pay its
                  internal expenses (including, without limitation, all salaries
                  and expenses of its officers and employees performing legal or
                  accounting duties), the expense of any annual audit, the fees
                  and expenses incurred in connection with the listing of the
                  securities to be registered on each securities exchange on
                  which securities of the same class are then listed or the
                  admission for trading of the securities to be registered in
                  each inter-dealer quotation system on which securities of the
                  same class are then traded, and rating agency fees.

 

13

 

(b)    In connection with each
                  Registration Statement required hereunder, the Company will
                  reimburse the Holders of Registrable Securities being
                  registered pursuant to such Registration Statement for the
                  reasonable fees and disbursements of not more than one counsel
                  at any one time (or more than one counsel if a conflict exists
                  among such Holders in the exercise of the reasonable judgment
                  of counsel for such Holders and the Company) chosen by the
                  Required Holders of the Registrable Securities being sold; the
                  expense of any additional counsel for the Holders shall be
                  paid by the Holders. 

(c)    The term "Registration Expenses"
                  shall mean the expenses payable by the Company pursuant to the
                  provisions of this Section 3.

SECTION 4.   
Conditions to Registration.

Each Holder's right to have Registrable
                Securities included in any Registration Statement filed by the
                Company in accordance with the provisions of Section 2 shall be
                subject to the following conditions:

(a)    The Holders on whose behalf such
                  Registrable Securities are to be included shall be required to
                  furnish the Company in a timely manner with all information
                  and undertakings required by the applicable rules and
                  regulations of the SEC or applicable state blue sky and other
                  securities laws, rules or regulations concerning the proposed
                  method or methods of disposition of such securities, the
                  identity of and compensation to be paid to any proposed
                  underwriters to be employed in connection therewith, and such
                  other information or undertakings as may be reasonably
                  required by the Company properly to prepare and file such
                  Registration Statement in accordance with applicable
                  provisions of the Securities Act and to register and qualify
                  such Registrable Securities for offer and sale under all
                  applicable state blue sky and other securities laws, rules or
                  regulations;

(b)    If any such Holder desires to sell
                  and distribute Registrable Securities over a period of time,
                  or from time to time, at then prevailing market prices, then
                  any such Holder shall execute and deliver to the Company such
                  written undertakings as the Company and its counsel may
                  reasonably require in order to assure full compliance with
                  relevant provisions of the Securities Act and the Exchange Act
                  and all applicable state blue sky and other securities laws,
                  rules or regulations;

(c)    In the case of any registration
                  requested pursuant to the provisions of Section 2(b), the
                  offering price for any Registrable Securities to be so
                  registered shall be no less than for any securities of the
                  same class then to be registered for sale for the account of
                  the Company or other security holders, unless such Registrable
                  Securities are to be offered from time to time based on the
                  prevailing market price; and

(d)    In the case of any underwritten
                  offering on behalf of the Holders of Registrable Securities,
                  such Holders will enter into such agreements (including
                  underwriting agreements and lock-up agreements) as the
                  managing underwriters shall reasonably request and as are
                  customary in similar circumstances, provided, however,
                  that no such agreements shall require any Holder to make any
                  representations or warranties to, or agreements with, the
                  Company or the underwriters other than representations,
                  warranties or agreements regarding such Holder, the ownership
                  of such Holder's Registrable Securities and such Holder's
                  intended method of distribution.

 

14

 

SECTION 5.   
Indemnification. 

(a)    Indemnification by the Company.
                  In the event of the registration of any Registrable Securities
                  under the Securities Act pursuant to the provisions hereof,
                  the Company will indemnify and hold harmless each seller of
                  such Registrable Securities, its partners, directors,
                  officers, employees and agents, each underwriter, broker and
                  dealer, if any, who participates in the offering or sale of
                  such securities, and each other Person, if any, who controls
                  such seller or any such underwriter, broker or dealer within
                  the meaning of either Section 15 of the Securities Act or
                  Section 20 of the Exchange Act (each such Person being
                  hereinafter sometimes referred to as an "Indemnified Person,"
                  provided, however, that for purposes of clauses (b),
                  (c) and (d) of this Section 5, "Indemnified Person"
                  shall also include the Company, its partners, directors,
                  officers, employees and agents, and each other Person, if any,
                  who controls the Company within the meaning of either Section
                  15 of the Securities Act or Section 20 of the Exchange Act)
                  from and against any losses, claims, damages, liabilities or
                  expenses, joint or several, to which such Indemnified Person
                  may become subject under the Securities Act, the Exchange Act
                  or otherwise, insofar as such losses, claims, damages,
                  liabilities or expenses (or actions in respect thereof) arise
                  out of or are based upon any untrue statement or alleged
                  untrue statement of a material fact contained or incorporated
                  by reference in any Registration Statement or Prospectus or
                  any amendment or supplement thereto or any document
                  incorporated by reference therein, or arise out of or are
                  based upon the omission or alleged omission to state therein a
                  material fact required to be stated therein or necessary to
                  make the statements therein not misleading, and will reimburse
                  each such Indemnified Person for any legal or other expenses
                  reasonably incurred by such Indemnified Person in connection
                  with investigating or defending any such loss, claim, damage,
                  liability, expense or action; provided, however,
                  that the Company will not be liable in any such case to the
                  extent that any such loss, claim, damage, liability, expense
                  or action (i) arises out of or is based upon an untrue
                  statement or alleged untrue statement or omission or alleged
                  omission made or incorporated by reference in the Registration
                  Statement or Prospectus or any amendment or supplement
                  thereto, in reliance upon and in conformity with written
                  information furnished to the Company by such Indemnified
                  Person specifically stating it is for use in preparation
                  thereof or (ii) arises out of the use of any Prospectus by an
                  Indemnified Party after the Company has provided such
                  Indemnified Party with the notice and supplement referred to
                  in Section 2(c)(xi) if such Prospectus is the subject of such
                  notice. Such indemnity shall remain in full force and effect
                  regardless of any investigation made by or on behalf of such
                  Indemnified Person and shall survive the transfer of such
                  Registrable Securities by such seller.

(b)    Indemnification by Holders of
                  Registrable Securities. In the event of the registration
                  of any Registrable Securities under the Securities Act
                  pursuant to the provisions hereof, each Holder on whose behalf
                  such Registrable Securities shall have been registered will
                  indemnify and hold harmless each and every Indemnified Person
                  against any losses, claims, damages, liabilities or expenses,
                  joint or several, to which such Indemnified Person may become
                  subject under the Securities Act, the Exchange Act or
                  otherwise, insofar as such losses, claims, damages,
                  liabilities or expenses (or actions in respect thereof) arise
                  out of or are based upon any untrue statement or alleged
                  untrue statement of a material fact contained or incorporated
                  by reference in any Registration Statement or Prospectus or
                  any amendment or supplement thereto or any document
                  incorporated by reference therein, or arise out of or are
                  based upon the omission or alleged omission to state therein a
                  material fact required to be stated therein or necessary to
                  make the statements therein not misleading, which untrue
                  statement or alleged untrue statement or omission or alleged
                  omission has been made or incorporated therein in reliance
                  upon and in conformity with written information furnished to
                  the Company by such Holder specifically stating that it is for
                  use in preparation thereof, and will reimburse each such
                  Indemnified Person for any legal or other expenses reasonably
                  incurred by such Indemnified Person in connection with
                  investigating or defending any such loss, claim, damage,
                  liability, expense or action; provided, however,
                  that the liability of each Holder hereunder shall be limited
                  to the proceeds received by such Holder from the sale of
                  Registrable Securities covered by such Registration Statement.

 

15

 

(c)    Procedure. Promptly after
                  receipt by an Indemnified Person of notice of the commencement
                  of any action (including any governmental investigation or
                  inquiry), such Indemnified Person will, if such Indemnified
                  Person intends to make a claim in respect thereof against the
                  party agreeing to indemnify such Indemnified Person pursuant
                  to paragraph (a) or (b) hereof (each such Person being
                  hereinafter referred to as an "Indemnifying Person"),
                  give written notice to such Indemnifying Person of the
                  commencement thereof, but the omission so to notify the
                  Indemnifying Person shall not relieve the Indemnifying Person
                  from any of its obligations pursuant to the provisions of this
                  Section 5 except to the extent that the Indemnifying Person is
                  actually prejudiced by such failure to give notice. In case
                  any such action is brought against any Indemnified Person and
                  it notifies an Indemnifying Person of the commencement
                  thereof, the Indemnifying Person shall be entitled to
                  participate in, and to the extent that it may wish, jointly
                  with any other Indemnifying Person similarly notified, to
                  assume the defense thereof, with counsel reasonably
                  satisfactory to such Indemnified Person, and after notice from
                  the Indemnifying Person to such Indemnified Person, the
                  Indemnifying Person shall not, except as hereinafter provided,
                  be responsible for any legal or other expenses subsequently
                  incurred by such Indemnified Person in connection with the
                  defense thereof. No Indemnifying Person will consent to entry
                  of any judgment or enter into any settlement which does not
                  include as an unconditional term thereof the giving by the
                  claimant or plaintiff to such Indemnified Person of a release
                  from all liability in respect of such claim or litigation.

Such Indemnified Person shall have the
                  right to employ separate counsel in any such action and to
                  participate in the defense thereof, but the fees and expenses
                  of such counsel shall be the expense of such Indemnified
                  Person unless (i) the Indemnifying Person has agreed to pay
                  such fees and expenses or (ii) the Indemnifying Person shall
                  have failed to assume the defense of such action or proceeding
                  or has failed to employ counsel reasonably satisfactory to
                  such Indemnified Person in any such action or proceeding or
                  (iii) the named parties to any such action or proceeding
                  (including any impleaded parties) include both such
                  Indemnified Person and the Indemnifying Person and such
                  Indemnified Person shall have been advised by counsel that
                  representation of both parties by the same counsel would be
                  inappropriate due to actual or potential material differing
                  interests between them (in which case, if such Indemnified
                  Person notifies the Indemnifying Person in writing that it
                  elects to employ separate counsel at the expense of the
                  Indemnifying Person, the Indemnifying Person shall not have
                  the right to assume the defense of such action or proceeding
                  on behalf of such Indemnified Person). The Indemnifying Person
                  shall not be liable for any settlement of any such action or
                  proceeding effected without its written consent, which consent
                  shall not unreasonably be withheld, delayed or conditioned,
                  but if settled with its written consent, or if there is a
                  final judgment for the plaintiff in any such action or
                  proceeding, the Indemnifying Person agrees to indemnify and
                  hold harmless such Indemnified Persons from and against any
                  loss or liability by reason of such settlement or judgment.

 

16

 

(d)    Contribution. To the extent
                  that the indemnification provided for in this Section 5 is
                  unavailable to a party that would have been an Indemnified
                  Person under this Section 5 in respect of any losses, claims,
                  damages, liabilities or expenses (or actions in respect
                  thereof) referred to herein, then each party that would have
                  been an Indemnifying Person thereunder shall, in lieu of
                  indemnifying such Indemnified Person, contribute to the amount
                  paid or payable by such Indemnified Person as a result of such
                  losses, claims, damages, liabilities or expenses (or actions
                  in respect thereof) in such proportion as is appropriate to
                  reflect the relative fault of the Indemnifying Person on the
                  one hand and the Indemnified Person on the other in connection
                  with the statement or omission which resulted in such losses,
                  claims, damages, liabilities or expenses (or actions in
                  respect thereof), as well as any other relevant equitable
                  considerations. The relative fault 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 of a material fact relates to information
                  supplied by the Indemnifying Person or the Indemnified Person
                  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 Section 5(c), any legal or
                  other fees or expenses reasonably incurred by such party in
                  connection with the investigation or defense of any action or
                  claim. The Company and each Holder of Registrable Securities
                  agrees that it would not be just and equitable if contribution
                  pursuant to this Section 5 were determined by pro rata
                  allocation or by any other method of allocation which does not
                  take account of the equitable considerations referred to in
                  this Section 5. Notwithstanding the provisions of this Section
                  5(d), no Holder of Registrable Securities shall be required to
                  contribute any amount in excess of the amount by which the
                  total price at which the Registrable Securities sold by it
                  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
contribution from any Person who was not guilty of such fraudulent
misrepresentation.

Indemnification or, if appropriate, contribution, similar to
that specified in the preceding provisions of this Section 5 (with appropriate
modifications) shall be given by the Company and each seller of Registrable
Securities with respect to any required registration or other qualification of
such securities under any federal or state law or regulation or governmental
authority other than the Securities Act.

In the event of any underwritten offering of Registrable
Securities under the Securities Act pursuant to the provisions of Section 2, the
Company and each Holder on whose behalf such Registrable Securities shall have
been registered agree to enter into an underwriting agreement, in customary
form, with the underwriters, which underwriting agreement may contain additional
provisions with respect to indemnification and contribution in lieu thereof.

 

17

 

SECTION 6.   
Exchange Act Registration; Rule 144
                Reporting. 

The Company covenants and agrees that until
                such time as the Holders no longer hold any Registrable
                Securities it will:

(a)    if required by law, maintain an
                  effective registration statement (containing such information
                  and documents as the SEC shall specify) with respect to the
                  Common Stock of the Company under Section 12(g) of the
                  Exchange Act;

(b)    make and keep public information
                  available, as those terms are understood and defined in Rule
                  144 under the Securities Act, even if the Company subsequently
                  ceases to be subject to the reporting requirements of the
                  Exchange Act;

(c)    file with the SEC in a timely
                  manner all reports and documents required of the Company under
                  the Securities Act and the Exchange Act;

(d)    furnish to any Holder promptly upon
                  request (i) a written statement by the Company as to its
                  compliance with the reporting requirements of Rule 144 (and
                  any similar or successor rules) and of the Securities Act and
                  the Exchange Act, (ii) a copy of the most recent annual or
                  quarterly report of the Company and (iii) such other reports
                  and documents of the Company and other information in the
                  possession of or reasonably obtainable by the Company as such
                  Holder may reasonably request in availing itself of any rule
                  or regulation of the SEC allowing such Holder to sell any such
                  securities without registration; and

(e)    take such further action as any
                  Holder of Registrable Securities may from time to time
                  reasonably request to enable such Holder to sell Registrable
                  Securities without registration under the Securities Act
                  within the limitation of the exemptions provided by (i) Rule
                  144 under the Securities Act, as such rule may be amended from
                  time to time, or (ii) any similar rule or regulation hereafter
                  adopted by the SEC.

The Company represents and warrants that such
                registration statement or any information, document or report
                filed with the SEC in connection therewith or any information so
                made public shall not contain any untrue statement of a material
                fact or omit to state a material fact required to be stated
                therein or necessary in order to make the statements contained
                therein not misleading. The Company agrees to indemnify and hold
                harmless (or to the extent the same is not enforceable, make
                contribution to) the Holders, their partners, officers,
                directors, employees and agents, each broker, dealer or
                underwriter (within the meaning of the Securities Act) acting
                for any Holder in connection with any offering or sale by such
                Holder of Registrable Securities or any Person controlling
                (within the meaning of either Section 15 of the Securities Act
                or Section 20 of the Exchange Act) such Holder and any such
                broker, dealer or underwriter from and against any and all
                losses, claims, damages, liabilities or expenses (or actions in
                respect thereof) arising out of or resulting from any breach of
                the foregoing representation or warranty, all on terms and
                conditions comparable to those set forth in Section 5.

 

18

 

SECTION 7.   
Limitation on Registration Rights of
                Others. 

The Company represents and warrants that it
                has not granted to any Person the right to request or require
                the Company to register any securities issued by the Company.
                The Company covenants and agrees that after the date hereof, so
                long as any Holder holds any Securities, the Company will not,
                directly or indirectly, grant to any Person or agree to or
                otherwise become obligated in respect of (a) any registration
                rights of securities of the Company upon the demand of any
                Person (including any shelf registration) without the prior
                written consent of the Required Holders; or (b) rights of
                registration in the nature or substantially in the nature of
                those set forth in Section 2 unless such rights are expressly
                subject and subordinated to the rights of registration of the
                Holders pursuant to Section 2 hereof on terms reasonably
                satisfactory to the Required Holders.

SECTION 8.   
Mergers, etc. 

In addition to any other restrictions on
                mergers, consolidations and reorganizations contained in the
                certificate of incorporation, bylaws or agreements of the
                Company, the Company covenants and agrees that it shall not,
                directly or indirectly, enter into any merger, consolidation or
                reorganization in which the Company shall not be the surviving
                corporation and in which the Holders shall not have had the
                right to receive cash for all their Registrable Securities,
                unless the surviving corporation shall, prior to such merger,
                consolidation or reorganization, agree in a writing satisfactory
                in form, scope and substance to the Required Holders to assume
                the obligations of the Company under this Agreement, and for
                such purpose references hereunder to "Registrable Securities"
                shall be deemed to include the securities which such Holders
                would be entitled to receive in exchange for Registrable
                Securities pursuant to any such merger, consolidation or
                reorganization.

If, and as often as, there are any changes in
                the Securities by way of stock split, stock dividend,
                combination or classification, or through merger, consolidation,
                reorganization or recapitalization, or by any other means,
                appropriate adjustments shall be made in the provisions hereof
                as may be required, so that the rights and privileges granted
                hereby shall continue with respect to the Securities as so
                changed.

SECTION 9.   
Notices, etc. 

All notices, consents, approvals, agreements
                and other communications provided hereunder shall be in writing
                or by telex or telecopy and shall be sufficiently given to the
                Initial Holders, the Holders or the Company if addressed or
                delivered to them:

	If to the Initial Holders: 	
		To the address
                listed underneath such Initial Holder's name in the signature
                pages hereof.

	 	 
	with copies to: 	
		Akin Gump Strauss Hauer &
                Feld LLP

	 	
		1111 Louisiana Street, 44th Floor

	 	
		Houston, TX 77002

	 	
		Attention: James L. Rice III, Esq.

	 	
		Telecopier No.: (713) 236-0822

	 	 

 

19

 

	If to any other Holder: 	
		At its last known
                address appearing on the books of the Company maintained for
                such purpose.

	 	 
	If to the Company: 	
		Horizon Offshore, Inc.

	 	
		2500 CityWest Boulevard, Suite 2200

	 	
		Houston, Texas 77042

	 	
		Attention: Executive Vice President and Chief
                Financial Officer

	 	
		Telecopier No.: (713) 361-2677

	 	 
	with copies to: 	
		Jones, Walker, Waechter,
                Poitevent, Carrere & Denegre, L.L.P.

	 	
		201 St. Charles Avenue, Suite 5100

	 	
		New Orleans, Louisiana 70170

	 	
		Attention: William B. Masters, Esq.

	 	
		Telecopier No.: (504) 582-8012

or at such other address as any party may
                designate to any other party by written notice. All such notices
                and communications shall be deemed to have been duly given: (i)
                at the time delivered by hand, if personally delivered, (ii)
                when received, if deposited in the mail, postage prepaid, (iii)
                when transmission is verified, if telecopied, and (iv) on the
                next Business Day, if timely delivered to an air courier
                guaranteeing overnight delivery.

SECTION 10.   Entire Agreement.

The parties hereto agree that this Agreement
                constitutes the entire agreement among the parties with respect
                to the subject matter hereof and supersedes all prior agreements
                and understandings between them as to such subject matter; and
                there are no restrictions, agreements, arrangements, oral or
                written, between any or all of the parties relating to the
                subject matter hereof which are not fully expressed or referred
                to herein or therein.

SECTION 11.   
Amendments; Waivers and
                Further Agreements. 

This Agreement may not be amended nor shall
                any waiver, change, modification, consent or discharge be
                effected except by an instrument in writing executed by or on
                behalf of the party or parties against whom enforcement of any
                amendment, waiver, change, modification, consent or discharge is
                sought; provided, however, that any waiver sought
                from the Holders of any provision of this Agreement which
                affects the Holders generally, and any action required to be
                taken by the Holders as a group pursuant to this Agreement,
                shall be given or taken by the Required Holders, and any such
                waiver or action so given or taken shall be binding on all
                Holders. No failure or delay by any party in exercising any
                right or remedy hereunder shall operate as a waiver thereof, and
                a waiver of a particular right or remedy on one occasion shall
                not be deemed a waiver of any other right or remedy or a waiver
                of the same right or remedy on any subsequent occasion.

 

20

 

Any waiver of any terms or conditions of this
                Agreement shall not operate as a waiver of any other breach of
                such terms or conditions or any other term or condition, nor
                shall any failure to enforce any provision hereof operate as a
                waiver of such provision or of any other provision hereof; provided,
however, that no such written waiver,
                unless it by its own terms explicitly provides to the contrary,
                shall be construed to effect a continuing waiver of the
                provision being waived and no such waiver in any instance shall
                constitute a waiver in any other instance or for any other
                purpose or impair the right of the party against whom such
                waiver is claimed in all other instances or for all other
                purposes to require full compliance with such provision. Each of
                the parties hereto agrees to execute all such further
                instruments and documents and to take all such further action as
                the other parties may reasonably require in order to effectuate
                the terms and purposes of this Agreement.

SECTION 12.   
Assignment; Successors and Assigns.

This Agreement shall be binding upon and
                shall inure to the benefit of the parties hereto and their
                respective heirs, executors, legal representatives, successors
                and permitted assigns, including, without limitation, any
                Holders from time to time of the Registrable Securities.
                Anything in this Agreement to the contrary notwithstanding, the
                term "Holders" as used in this Agreement shall be deemed to
                include the registered Holders from time to time of the Series B
                Preferred Shares.

SECTION 13.   
Severability. 

If any provision of this Agreement shall be
                held or deemed to be, or shall in fact be, invalid, inoperative
                or unenforceable as applied to any particular case in any
                jurisdiction or jurisdictions, or in all jurisdictions or in all
                cases, because any provision conflicts with any constitution,
                statute, rule or public policy, or for any other reason, such
                circumstance shall not have the effect of rendering the
                provision or provisions in question invalid, inoperative or
                unenforceable in any other jurisdiction or in any other case or
                circumstance or of rendering any other provision or provisions
                herein contained invalid, inoperative or unenforceable to the
                extent that such other provisions are not themselves actually in
                conflict with such constitution, statute, rule or public policy,
                but this Agreement shall be reformed and construed in any such
                jurisdiction or case as if such invalid, inoperative or
                unenforceable provision had never been contained herein and such
                provision reformed so that it would be valid, operative and
                enforceable to the maximum extent permitted in such jurisdiction
                or in such case.

SECTION 14.   
Counterparts. 

This Agreement may be executed in two or more
                counterparts (each of which need not be executed by each of the
                parties), each of which shall be deemed an original, but all of
                which together shall constitute one and the same instrument, and
                in pleading or proving any provision of this Agreement, it shall
                not be necessary to produce more than one such counterpart.

SECTION 15.  
Gender; Usage. 

Whenever used herein the singular number
                shall include the plural, the plural shall include the singular,
                and the use of any gender shall include all genders. The words
                "hereof," "herein" and "hereunder," and words of similar import,
                when used in this Agreement shall refer to this Agreement as a
                whole and not to any particular provision of this Agreement.

 

21

 

SECTION 16.   
Governing Law. 

THIS AGREEMENT SHALL BE GOVERNED BY AND
                CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
                OF NEW YORK OTHER THAN THE CONFLICTS OF LAWS PRINCIPLES THEREOF.

SECTION 17.   
Survival. 

The indemnification and contribution
                provisions of Section 5 shall survive, notwithstanding the fact
                that any Shares shall cease to be Registrable Securities.

SECTION 18.   
Expenses. 

Supplementing the provisions of Section 5,
                the Company shall be obligated to pay to the Holders, on demand,
                all costs and expenses (including, without limitation, court
                costs and attorneys' fees and expenses and interest to the
                extent permitted by applicable law on overdue amounts) paid or
                incurred in collecting any sums due from, or enforcing any other
                obligations of, the Company.

SECTION 19.   
Specific Performance.

The Company recognizes that the rights of the Holders under this Agreement
are unique and, accordingly, the Holders shall, in addition to such other
remedies as may be available to any of them at law or in equity, have the right
to enforce their rights hereunder by actions for injunctive relief and specific
performance to the extent permitted by law. The Company 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 agrees to waive the
defense in any action for specific performance that a remedy at law would be
adequate. This Agreement is not intended to limit or abridge any rights of the
Holders which may exist apart from this Agreement.

 

22

 

IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.

HORIZON
OFFSHORE, INC.

 

 

By:_________________________________

Name: 

Title: 

 

 

INITIAL HOLDERS:

 

ELLIOTT
ASSOCIATES, L.P.

 

By: Elliott Capital Advisors, L.P.,

as General Partner

 

By: Braxton Associates, Inc.,

as General Partner

 

 

By:_________________________________

Name: 

Title: 

 

Address: 712 Fifth Avenue

36th Floor

New York, New York 10019

 

 

ELLIOTT
INTERNATIONAL, L.P.

 

By: Elliott International Capital Advisors Inc.,

as Attorney-in-Fact

 

 

By:_________________________________

Name: 

Title: 

 

Address: 712 Fifth Avenue

36th Floor

New York, New York 10019

 

 

 

23

 

FALCON MEZZANINE PARTNERS, LP

 

By: Falcon Mezzanine Investments, LLC, its

General Partner

 

 

By:_______________________________________

Name:

Title: 

 

Address: 60 Kendrick Street

Needham, Massachusetts 02494

Telecopier No.: (781) 247-7299

 

 

 

24

 

D. E. SHAW
LAMINAR PORTFOLIOS, L.L.C.

 

 

By:_______________________________________

Name: 

Title: 

 

Address: 120 West 45th St.

New York, New York 10036

 

 

25

 

 

 

 

_______________________________________

Name: Kevin G. Douglas,

in his individual capacity

 

Address: 1101 5th Ave., Suite
                              360

San Rafael, CA 94901

 

 

26

 

 

 

 

_______________________________________

Name: Michelle M. Douglas,

in her individual capacity

 

Address: 1101 5th Ave., Suite
                              360

San Rafael, CA 94901

 

27

 

 

 

 

_______________________________________

Name: Lloyd I. Miller,

in his individual capacity

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

28

 

 

 

 

SACC PARTNERS, LP

 

 

By:_______________________________________

Name: Tom Kelleher

Title: General Partner

 

Address: 11150 Santa Monica
                              Blvd., Suite 750

Los Angeles, CA 90025

 

 

 

29

 

KEVIN G. DOUGLAS AND MICHELLE M. DOUGLAS, JTWROS

 

 

By:_______________________________________

Name: Kevin Douglas

in his capacity as joint tenant with right of
                          survivorship

 

 

By:_______________________________________

Name: Michelle Douglas

in her capacity as joint tenant with right of
                          survivorship 

 

Address: 1101 5th Ave., Suite
                              360

San Rafael, CA 94901

 

 

 

30

 

DOUGLAS FAMILY TRUST

 

 

By:_______________________________________

Name: James E. Douglas Jr.

Title: Trustee

 

 

By:_______________________________________

Name: Jean A. Douglas

Title: Trustee

 

Address: 1101 5th Ave., Suite
                              360

San Rafael, CA 94901

 

 

 

31

 

JAMES DOUGLAS AND JEAN DOUGLAS IRREVOCABLE
                        DESCENDANT'S TRUST

 

 

By:_______________________________________

Name: Kevin Douglas

Title: Trustee

 

 

By:_______________________________________

Name: Michelle Douglas

Title: Trustee

 

Address: 1101 5th Ave., Suite
                              360

San Rafael, CA 94901

 

 

 

32

 

B. RILEY & CO. RETIREMENT TRUST

 

 

By:_______________________________________

Name: Bryant Riley

Title: Trustee

 

Address: 11150 Santa Monica
                              Blvd., Suite 750

Los Angeles, CA 90025

 

 

 

33

 

B. RILEY & CO.,
INC.

 

 

By:_______________________________________

Name: Bryant Riley

Title: Chairman

 

Address: 11150 Santa Monica
                              Blvd., Suite 750

Los Angeles, CA 90025

 

 

 

34

 

L. MILLER III GST dtd 12/31/91

 

 

By:_______________________________________

Name: Lloyd I. Miller

Title: Trustee

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

 

 

35

 

MILFAM, LLC

 

 

By:_______________________________________

Name: Lloyd I. Miller

Title: General Partner

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

 

 

36

 

CATHERINE C. MILLER IRREV TR DTD 3/26/91

 

 

By:_______________________________________

Name: Lloyd I. Miller

Title: Trustee

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

 

 

37

 

ALEXANDRA B. MILLER

 

 

By:_______________________________________

Name: Lloyd I. Miller

Title: Custodian FL/UTMA

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

 

 

38

 

LLOYD I. MILLER

 

 

By:_______________________________________

Name: Lloyd I. Miller

in his individual capacity

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

 

 

39

 

LLOYD I. MILLER TRUST A-4

 

By: PNC Bank

 

 

By:_______________________________________

Name: Alan Goldman

Title: Trustee

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

 

 

40

 

MILFAM I, L.P.

 

 

By:_______________________________________

Name: Lloyd I. Miller

Title: Limited Partner

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

 

 

41

 

MILFAM II, L.P.

 

 

By:_______________________________________

Name: Lloyd I. Miller

Title: Limited Partner

 

Address: 4550 Gordon Drive

Naples, FL 34102

 

 

 

42

 

HIGHLAND CRUSADER OFFSHORE PARTNERS

 

 

By:_______________________________________

Name: Kurt Plummer

Title: General Partner

 

Address: 13455 Noel Road, Suite 1300

Dallas, TX 75240

 

 

 

43

 

HEDGEHOP CAPITAL

 

 

By:_______________________________________

Name: 

Title: 

 

Address: 1117 East Putnam Avenue,
                        Suite 320

Riverside, CT 06878

 

 

 

44

 

THE CONUS FUND,
L.P.

 

 

By:_______________________________________

Name: 

Title: 

 

Address: 1 Rockefeller Plaza, 18th
                        Floor

New York, New York 10020

 

 

 

45

 

THE CONUS FUND (QP),
L.P.

 

 

By:_______________________________________

Name: 

Title: 

 

 

Address: 1 Rockefeller Plaza, 18th
                        Floor

New York, New York 10020

 

 

 

46

 

EAST HUDSON INC. (BVI)

 

 

By:_______________________________________

Name: 

Title: 

 

Address: 1 Rockefeller Plaza, 18th
                        Floor

New York, New York 10020

 

 

 

47

 

THE CONUS FUND OFFSHORE LIMITED

 

 

By:_______________________________________

Name: 

Title: 

 

Address: 1 Rockefeller Plaza, 18th
                        Floor

New York, New York 10020

 

 

 

48

 

RICHARD RILEY

 

 

By:_______________________________________

Name: 

Title: 

 

Address: 133 Shoreclifff Road,

Corona del Mar, CA 92625

 

 

 

49

 

LANGLEY PARTNERS, L.P.

 

By: Langley Capital, LLC, as General Partner

 

 

By: ___________________________________

Name:

Title: 

 

Address: 535 Madison Avenue, 7th Floor

New York, NY 10022

 

 

50AMENDMENT NO. 1 TO RIGHTS AGREEMENT

     THIS AMENDMENT NO. 1 TO RIGHTS  AGREEMENT (this  "Amendment"),  dated as of
June 15, 2005, is between  Nathan's  Famous,  Inc., a Delaware  corporation (the
"Company"),  and American Stock  Transfer & Trust Company,  as rights agent (the
"Rights Agent").

     WHEREAS,  the Company and the Rights  Agent are parties to a Third  Amended
and  Restated  Rights  Agreement,  dated as of December  10,  1999 (the  "Rights
Agreement"); and

     WHEREAS,  pursuant  thereto  and  the  provisions  of  the  certificate  of
incorporation of the Company, the Company distributed a Right (as defined in the
Rights  Agreement)  to each holder of shares of Common  Stock (as defined in the
Rights Agreement) of the Company; and

     WHEREAS,  the  Company  desires to amend the Rights  Agreement  pursuant to
Section 27 of the Rights Agreement as set forth below.

     NOW, THEREFORE, the Rights Agreement is hereby amended as follows:

     1.   AMENDMENT OF SECTION 7.

     Section 7 of the Rights  Agreement  is amended by deleting  subsection  (a)
thereof and replacing it in its entirety with the following:

               "(a) Subject to Section 7(e) hereof, the registered holder of any
          Right Certificate may exercise the Rights evidenced thereby (except as
          otherwise  provided  herein) in whole or in part at any time after the
          Distribution  Date upon surrender of the Right  Certificate,  with the
          form  of  election  to  purchase  on the  reverse  side  thereof  duly
          executed,  to the Rights Agent at the  principal  office of the Rights
          Agent in New York,  New York,  together  with  payment of the Purchase
          Price for each  share of the  Common  Stock as to which the Rights are
          exercised,  at or prior to the close of business on the earlier of (i)
          June 19, 2010 (the "Final Expiration Date"), or (ii) the date on which
          the Rights are  redeemed as provided in Section 23 (such  earlier date
          being herein referred to as the "Expiration  Date"); or (iii) the time
          at which the Rights are  exchanged  as  provided in Section 24 hereof;
          provided,  however,  that if the  number  of  Rights  exercised  would
          entitle  the  holder  thereof to receive  any  fraction  of a share of
          Common Stock  greater  than  one-half of a share,  the holder  thereof
          shall not be  entitled  to  exercise  such  Rights  unless such holder
          concurrently purchases from the Company (and in such event the Company
          shall sell to such  holder),  at a price in proportion to the Purchase
          Price, an additional  fraction of a share of Common Stock which,  when
          added to the number of shares of Common Stock to be received upon such
          exercise, will equal an integral number of shares of Common Stock."

<PAGE>

         2.       MISCELLANEOUS.

     Except as expressly amended hereby,  the Rights Agreement shall continue in
full  force and effect in  accordance  with the  provisions  thereof on the date
hereof.  This Amendment  shall be deemed to be a contract made under the laws of
the State of Delaware and for all purposes shall be governed by and construed in
accordance  with the laws of such state  applicable  to contracts to be made and
performed  entirely  within such state.  This  Amendment  may be executed in any
number of  counterparts,  each of such  counterparts  shall for all  purposes be
deemed to be an original,  and all such counterparts  shall together  constitute
but one and the same  instrument.  Terms not defined  herein  shall,  unless the
context  otherwise  requires,  have the  meanings  assigned to such terms in the
Rights Agreement.

     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Amendment to be
duly executed as of the date set forth above.

                                       NATHAN'S FAMOUS, INC.

                                       By:  /s/Wayne Norbitz
                                           -----------------------------
                                            Name:  Wayne Norbitz
                                            Title: President

                                       AMERICAN STOCK TRANSFER & TRUST  COMPANY
                                       as Rights Agent

                                       By:  /s/Herbert Lemmer
                                          ------------------------------------
                                           Name:  Herbert Lemmer
                                           Title: Vice President

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