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EXHIBIT 10.5
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and
entered into as of May 18, 1999, by and among BOLDER Technologies Corporation, a
Delaware corporation (the "Company") and the persons listed on Exhibit A hereto
(the "Purchasers") with respect to the Purchase Agreement dated as of May 18,
1999 between the Company and the Purchasers (the "Purchase Agreement") for the
purchase of up to 1,500,000 shares of the Company's Common Stock (the "Common
Stock"). In order to induce the Purchasers to enter into the Purchase Agreement,
the Company has agreed to provide the registration rights set forth in this
Agreement. The execution of this Agreement is a condition to the closing under
the Purchase Agreement.
The Company agrees with the Purchasers, (i) for their benefit as
Purchasers and (ii) for the benefit of the holders from time to time of the
Common Stock (each of the foregoing a "Holder" and together the "Holders"), as
follows:
1. Definitions. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:
Affiliate: "Affiliate" means, with respect to any specified person, (i)
any other person directly or indirectly controlling or controlled by, or under
direct or indirect common control with, such specified person or (ii) any
officer or director of such other person. For purposes of this definition, the
term "control" (including the terms "controlling," "controlled by" and "under
common control with") of a person means the possession direct or indirect, of
the power (whether or not exercised) to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting
securities, by contract, or otherwise.
Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday that
is not a day on which banking institutions in the City of New York are
authorized or obligated by law or executive order to close.
Damages Accrual Period: See Section 2(d) hereof.
Damages Payment Date: The first business day of each month following
the Effectiveness Target Date.
Effectiveness Period: The period commencing with the date hereof and
ending on the earlier of the date that is two years after the later of the
initial date of original issuance of the Common Stock and the date that all
Registrable Securities have ceased to be Registrable Securities.
Effectiveness Target Date: See Section 2(a) hereof.
Event: See Section 2(d) hereof.
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Event Date: See Section 2(d) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Filing Date: See Section 2(a) hereof.
Holder: See the second paragraph of this Agreement.
Initial Shelf Registration: See Section 2(a) hereof.
Liquidated Damages: See Section 2(d) hereof.
Losses: See Section 5 hereof.
Majority of Registrable Securities: A majority of the then outstanding
aggregate principal amount of Registrable Securities.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any amendment or prospectus supplement, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such Prospectus.
Purchase Agreement: See the first paragraph of this Agreement.
Record Holder: With respect to any Damages Payment Date relating to the
Common Stock, each Person who is a registered holder of Common Stock 15 days
prior to such Damages Payment Date.
Registrable Securities: The Common Stock issued pursuant to the
Purchase Agreement, and any Common Stock issued with respect thereto upon any
stock dividend, split or similar event, until (i) it is effectively registered
under the Securities Act and disposed of in accordance with the Registration
Statement covering it, (ii) it is salable by the holder thereof pursuant to Rule
144(k) or (iii) it is sold to the public pursuant to Rule 144, and, as a result
of the event or circumstance described in any of the foregoing clauses (i)
through (iii), the legends with respect to transfer restrictions required under
the Purchase Agreement (other than any such legends required solely as the
consequences or the fact that the Registrable Securities are owned by, or were
previously owned by, the Company or an Affiliate of the Company) are removed or
removable in accordance with the terms of the Purchase Agreement.
Registration Expenses: See Section 5 hereof.
Registration Statement: Any registration statement of the Company which
covers any of
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the Registrable Securities pursuant to the provisions of this Agreement,
including the Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
Rule 144: Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulations hereafter adopted
by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations promulgated by the SEC thereunder.
Selling Holder: A Holder offering to sell Registrable Securities.
Shelf Registration: See Section 2(a) hereof.
Subsequent Shelf Registration: See Section 2(b) hereof.
Suspension Period: See Section 2(c).
2. Shelf Registration.
(a) The Company shall prepare and file with the SEC, as soon as
practicable but in any event on or prior to the date 30 days following the
latest date of original issuance of the Common Stock (the "Filing Date"), a
Registration Statement for an offering to be made on a continuous basis pursuant
to Rule 415 of the Securities Act (a "Shelf Registration") registering the
resale from time to time by Holders thereof of all of the Registrable Securities
(the "Initial Shelf Registration"). The Initial Shelf Registration shall be on
an appropriate SEC Registration Statement form permitting registration of such
Registrable Securities for resale by such Holders in the manner or manners
designated by them. The Company shall use its best efforts to cause the Initial
Shelf Registration to be declared effective under the Securities Act as soon as
practicable but in any event or prior to the date 90 days following the latest
date of original issuance of the Common Stock (the "Effectiveness Target Date"),
and shall use its best efforts to keep the Initial Shelf Registration
continuously effective under the Securities Act, subject to the provisions of
Section 2(c), until the earlier of the expiration of the Effectiveness Period or
the date a Subsequent Shelf Registration (as defined below) covering all of the
Registrable Securities has been declared effective under the Securities Act.
Subject to the right of the Company to have the Initial Shelf Registration not
be effective, or not to be updated, amended or supplemented, for periods of time
set forth in Section 2(c), the Company further agrees to use its best efforts to
prevent the happening of any event that would cause the Initial Shelf
Registration to contain a material misstatement or omission or to be not
effective and usable for resale of the Registrable Securities during the
Effective Period.
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(b) If the Initial Shelf Registration or any subsequent Shelf
Registration ceases to be effective for any reason as a result of the issuance
of a stop order by the SEC at any time during the Effectiveness Period, the
Company shall use its best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 30 days of
such cessation of effectiveness amend the Shelf Registration in a manner
reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Shelf Registration covering all of
the Registrable Securities (a "Subsequent Shelf Registration"). If a Subsequent
Shelf Registration is filed, the Company shall use its best efforts to cause the
Subsequent Shelf Registration to be declared effective as soon as practicable
after such filing and to keep such Registration Statement continuously effective
until the end of the Effectiveness Period.
(c) In the event (A) of the happening of any event of the kind
described in Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v) or 3(c)(vi) hereof
or (B) that, in the good faith judgment of the Company, it is advisable to
suspend the use of the Prospectus for a discrete period of time due to pending
material corporate developments or similar material events that have not yet
been publicly disclosed and as to which the Company believes public disclosure
will be prejudicial to the Company, the Company shall deliver a certificate in
writing, signed by an authorized executive officer of the Company, to the
Purchasers, to the effect of the foregoing and thereafter the use of the
Prospectus shall be suspended, and the Company, subject to the terms of this
Section 2(c), shall thereafter not be required to maintain the effectiveness or
update the Shelf Registration. The Company will use its best efforts to ensure
that the use of the Prospectus may be resumed as soon as practicable, in the
case of suspension under Section 2(c)(A), and, in the case of a pending
development or event referred to in Section 2(c)(B) hereof, as soon as, in the
good faith judgment of the Company, public disclosure of such material corporate
development or similar material event would not have a material adverse effect
on the Company. Notwithstanding the foregoing, the Company shall not under any
circumstances be entitled to exercise its right under this Section 2(c) to
suspend the use of the Prospectus (whether as a result of events referred to in
Section 2(c)(A) hereof or as a result of the pending development or event
referred to in Section 2(c)(B) hereof) more than one (1) time in any three (3)
month period, and the periods in which the use of the Prospectus is suspended
shall not exceed 30 days in any three-month period (a "Suspension Period").
(d) The parties hereto agree that the Holders of Registrable Securities
will suffer damages, and that it would not be feasible to ascertain the extent
of such damages with precision, if the Initial Shelf Registration has not been
declared effective by the Effectiveness Target Date (an "Event," and the
Effectiveness Target Date being referred to herein as an "Event Date").
Notwithstanding the foregoing, the parties hereto agree that an Event shall be
deemed not to have occurred to the extent the parties mutually agree that the
direct, proximate cause of said Event was the act or failure to act of one or
more Holders. An Event shall be deemed to continue until the date of the
termination of such Event, which shall be the date the Initial Shelf
Registration is declared effective.
Accordingly, upon the occurrence of any Event and until such time
as there is no Event which has occurred and is continuing (a "Damages Accrual
Period"), commencing on the Event Date on which such Damages Accrual Period
began, the Company agrees to pay, as
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liquidated damages, and not as a penalty, an additional amount (the "Liquidated
Damages") to each holder of shares of Common Stock that are Registrable
Securities, accruing at a rate equal to (i) 24% per annum during the first 30
days following the Effectiveness Target Date and (ii) 12% per annum thereafter,
multiplied by the aggregate purchase price paid by such holder for the number of
shares of Common Stock that are Registrable Securities held by such holder.
Notwithstanding the foregoing, no Liquidated Damages shall accrue as to any
Registrable Securities from and after the earlier of (x) the date such
securities are no longer Registrable Securities, and (y) the expiration of the
Effectiveness Period.
The Liquidated Damages shall be paid by the Company to the Holders
on each Damages Payment Date by wire transfer of immediately available funds to
the account specified by them or by mailing checks to their registered addresses
as they appear in the register of the Company for the Common Stock. Nothing
shall preclude a Holder of Registrable Securities from pursuing or obtaining
specific performance or other equitable relief with respect to this Agreement.
All of the Company's obligations set forth in this Section 2(d)
which are outstanding with respect to any Registrable Securities at the time
such security ceases to be a Registrable Security shall survive until such time
as all such obligations with respect to such security have been satisfied in
full (notwithstanding termination of the Agreement pursuant to Section 7(o)).
The parties hereto agree that the Liquidated Damages provided for in this
Section 2(d) constitute a reasonable estimate of the damages that may be
incurred by holders of Registrable Securities by reason of the failure of the
Shelf Registration to be declared effective in accordance with the provisions
hereof. The provisions of this Section 2(d) shall in no way be deemed to limit
the rights of the Holders to pursue all legal and equitable remedies and to
recovery full damages in the event of a breach of this Agreement by the Company.
In the event of such breach, the Holders shall be permitted to pursue all
remedies as provided for in Section 7(a) below.
3. Registration Procedures. In connection with the Company's
registration obligations under Section 2 hereof, the Company shall effect such
registrations to permit the sale of the Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant thereto
the Company shall as expeditiously as possible:
(a) Prepare and file with the SEC a Registration Statement or
Registration Statements on any appropriate form under the Securities Act
available for the sale of the Registrable Securities by the Holders thereof in
accordance with the intended method or methods of distribution thereof and shall
include all required financial statements, and use its best efforts to cause
each such Registration Statement to become effective and remain effective as
provided herein; provided, that before filing any such Registration Statement or
Prospectus or any amendments or supplements thereto the Company shall furnish
within a reasonable time period to each Selling Holder (if requested by such
Selling Holder) copies of all such documents proposed to be filed, which
documents will be subject to the review of each Selling Holder (if requested by
such Selling Holder), and the Company shall not file any such Registration
Statement or amendment thereto or any Prospectus or any supplement thereto to
which the Holders of a Majority of Registrable Securities covered by such
Registration Statement shall
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reasonably object in writing within five Business Days after the receipt
thereof.
(b) Subject to Section 2(c), prepare and file with the SEC such
amendments and post-effective amendments to each Registration Statement as may
be necessary to keep such Registration Statement continuously effective for the
applicable period specified in Section 2; cause the related Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 (or any similar provisions then in force) 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 methods or
disposition by the sellers thereof set forth in such Registration Statement as
so amended or such Prospectus as so supplemented. The Company shall ensure that
(i) any Shelf Registration and any amendment thereto and any Prospectus forming
a part thereof and any amendment or supplement thereto complies in all material
respects with the Act and the rules and regulations thereunder, (ii) any Shelf
Registration and any amendment thereto does not, when it becomes effective,
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading and (iii)
any Prospectus forming part of any Shelf Registration, and any amendment or
supplement to such Prospectus, does not include an untrue statement or a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(c) Notify the Holders and (if requested by any such person) confirm
such notice in writing, (i) when a Prospectus, any Prospectus supplement, a
Registration Statement or a post-effective amendment to a Registration Statement
has been filed with the SEC, and, with respect to a Registration Statement or
any post-effective amendment, when the same has become effective; (ii) of any
request by the SEC or any other federal or state governmental authority for
amendments or supplements to a Registration Statement or related Prospectus or
for additional information, (iii) of the issuance by the SEC or any other
federal or state governmental authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation or threatening of
any proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceedings for such
purpose, (v) of the existence of any fact or happening of any event which makes
any statement of a material fact in such Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue or which would require the making of any changes in the
Registration Statement or Prospectus in order that, in the case of the
Registration Statement, it will not contain any 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, and that in the case of
the Prospectus, it will not contain any 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, in the light of the circumstances under which they
were made, not misleading, and (vi) of the Company's determination that a
post-effective amendment to a Registration Statement would be appropriate.
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(d) Use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement, or the lifting of any
suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest possible
moment.
(e) If requested by the Holders of a Majority of the Registrable
Securities being sold, (i) promptly incorporate in a Prospectus supplement or
post-effective amendment to Registration Statement such information as such
Holders and the Company agree should be included therein, and (ii) make all
required filings of such Prospectus supplement or such post-effective amendment
as soon as practicable after the Company has received notification of the
matters proposed to be incorporated in such Prospectus supplement or
post-effective amendment.
(f) Furnish to each Selling Holder (if requested by such Selling
Holder), without charge, at least one conformed copy of the Registration
Statement or Statements and any amendment thereto, including financial
statements but excluding schedules, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.
(g) Deliver to each Selling Holder in connection with any offering of
Registrable Securities, without charge, as many copies of the Prospectus or
Prospectuses relating to such Registrable Securities (including each preliminary
prospectus) and any amendment or supplement thereto as such persons may
reasonably request; and the Company hereby consents to the use of such
Prospectus or each amendment or supplement thereto by each of the Selling
Holders of Registrable Securities and the Underwriters, if any, in connection
with any offering and sale of the Registrable Securities covered by such
Prospectus or any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities, to register
or qualify or cooperate with the Selling Holders in connection with any
registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States as
any Selling Holder reasonably requests in writing, keep each such registration
or qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective 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 applicable
Registration Statement, provided, that the Company will not be required to (i)
qualify generally to do business in any jurisdiction where it is not then so
qualified (ii) take any action that would subject it to general service of
process in suits or to taxation in any such jurisdiction where it is not then so
subject.
(i) Cause the Registrable Securities covered by the applicable
Registration Statement to be registered with or approved by such other
governmental agencies in addition to the SEC or authorities within the United
States as may be necessary to enable the Selling Holder or Holders thereof to
consummate the disposition of such Registrable Securities.
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(j) During the Effectiveness Period (subject to the provisions of
Section 2(c)), immediately upon the existence of any fact or the occurrence of
any event as a result of which a Registration Statement shall contain any 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, in light of the
circumstances under which they were made, not misleading, or a Prospectus shall
contain any 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,
in the light of the circumstances under which they were made, not misleading,
promptly prepare and file a post-effective amendment to each Registration
Statement or a supplement to the related Prospectus or any document incorporated
therein by reference or file any other required document (such as a Current
Report on Form 8-K) that would be incorporated by reference into the
Registration Statement so that the Registration Statement shall not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading,
in light of the circumstances under which they were made, and so that the
Prospectus will not contain any 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, in the light of the circumstances under which they were
made, not misleading, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, and in the case of a
post-effective amendment to a Registration Statement use its best efforts to
cause it to become effective as soon as practicable.
(k) Enter into such agreements and take all such other actions in
connection therewith in order to expedite or facilitate the disposition of such
Registrable Securities and in such connection, whether or not an underwriting
agreement is entered into.
(l) Make available for inspection by a representative of the Holders of
Registrable Securities being sold and any attorney or accountant retained by
such Selling Holders or underwriter, financial and other records, pertinent
corporate documents and properties of the Company and its subsidiaries, and
cause the executive officers, directors and employees of the Company and its
subsidiaries to supply all information reasonably requested by any such
representative, attorney or accountant in connection with such disposition;
provided, however, that any information that is reasonably and in good faith
designated by the Company in writing as confidential at the time of delivery of
such information shall be kept confidential by such persons, unless (i)
disclosure of such information is required by court or administrative order or
is necessary to respond to inquiries of regulatory authorities, (ii) disclosure
of such information is required by law (including any disclosure requirements
pursuant to federal securities laws in connection with the filing of any
Registration Statement or the use of any prospectus referred to in this
Agreement), (iii) such information becomes generally available to the public
other than as a result of disclosure or failure to safeguard by any such person
or (iv) such information becomes available to any such person from a source
other than the Company and such source is not bound by a confidentiality
agreement.
(m) Comply with all applicable rules and regulations of the SEC in all
material respects and make generally available to its securityholders earning
statements (which need not be audited) satisfying the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act) no later than 45 days after the end of any
12-month period (or 90 days after the end of any 12-month period if such period
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is a fiscal year) (i) commencing at the end of any fiscal quarter in which
Registrable Securities are sold to underwriters in firm commitment or best
efforts underwritten offering and (ii) if not sold to underwriters in such an
offering, commencing on the first day of the first fiscal quarter of the Company
commencing after the effective date of a Registration Statement, which
statements shall cover said 12-month periods.
(n) Cooperate with the Selling Holders of Registrable Securities to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends; and
enable such Registrable Securities to be in such denominations and registered in
such names as the Holders may request.
(o) Not later than the effectiveness date of any Registration Statement
hereunder, provide a CUSIP number for the Registrable Securities registered
under such Registration Statement, and provide the transfer agent for the Common
Stock with printed certificates for the Registrable Securities which are in a
form eligible for deposit with The Depository Trust Company.
(p) Cause all shares of Common Stock covered by the Registration
Statement to be listed or quoted on, each securities exchange or quotation
system on which the Company's Common Stock is then listed or quoted no later
than the date the Registration Statement is declared effective, and, in
connection therewith, to the extent applicable, to make such filings under the
Exchange Act (e.g., the filing of a Registration Statement on Form 8-A) and to
have such filings declared effective thereunder.
(q) Cooperate and assist in any filing required to be made with the
National Association of Securities Dealers, Inc.
The Company may require each Holder of securities to be sold pursuant
to any Registration Statement to furnish to the Company such information
regarding the Holder and the distribution of such securities as the Company may
from time to time reasonably require for inclusion in such Registration
Statement. Any Holder who fails to provide such information shall not be
entitled to use the Prospectus.
4. Registration Expenses. All fees and expenses incident to the
Company's obligations under this Agreement shall be borne by the Company whether
or not any of the Registration Statements become effective. Such fees and
expenses shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses with respect to filings
required to be made with the National Association of Securities Dealers, Inc.),
(ii) printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities in a form eligible for deposit with The
Depository Trust Company, (iii) reasonable fees and disbursements of counsel for
the Company in connection with the Shelf Registration, and (iv) fees and
disbursements of all independent certified public accountants referred to in
Section 3(k)(iii) hereof (including the expenses of any special audit and "cold
comfort" letters required by or incident to such performance). In addition, the
Company shall pay the fees and expenses incurred in connection with the listing
or quotation of the securities to be registered on any securities exchange or
quotations system on which similar securities issued by
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the Company are then listed and the fees and expenses of any person, including
special experts, retained by the Company.
5. Indemnification.
(a) Indemnification by the Company. The Company shall indemnify and
hold harmless each Holder, the directors, officers and employees of each such
Holder and each person, if any, who controls any such Holder (within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act)
from and against all losses, liabilities, damages and expenses (including
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim)
(collectively, "Losses"), arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement or Prospectus or in any amendment or supplement thereto, or arising
out of or based upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in light of the circumstances under which they were
made, except insofar as such Losses arise out of or are based upon the
information relating to any Holder furnished to the Company in writing by any
Holder expressly for use therein. The Company shall also indemnify each
underwriter, their officers and directors, and each person who controls such
person (within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent and with the same limitations as provided
above with respect to the indemnification of the Holders or Registrable
Securities.
(b) Indemnification by Holder of Registrable Securities. Each Holder,
agrees severally and not jointly to indemnify and hold harmless the Company, its
directors, its officers who sign a Registration Statement and each 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 all losses
arising out of or based upon any untrue statement of a material fact contained
in any Registration Statement, Prospectus or arising out of or based upon any
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, in light of the circumstances under which
they were made, to the extent, but only to the extent, that such untrue
statement or omission is contained in any information relating to such Holder so
furnished in writing by such Holder to the Company expressly for use in such
Registration Statement or Prospectus. In no event shall the liability of any
Selling Holder of Registrable Securities hereunder be greater in amount than the
dollar amount of the proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. In case any proceeding
(including any governmental investigation) shall be instituted involving any
person in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person (the "indemnified party") shall promptly
notify the person against whom such indemnity may be sought (the "indemnifying
party") in writing, but failure so to notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof. The indemnifying party, upon
request of the indemnified party, shall retain counsel satisfactory to the
indemnified party to represent the indemnified party and
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any others the indemnifying party may designate in such proceeding and shall pay
the fees and disbursements of such counsel related to such proceeding. In any
such proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention to such counsel, (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them, or (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action. It is understood that the indemnifying party shall not, in respect of
the legal expenses or any indemnified party in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
all indemnified parties under Section 5(a) or 5(b) hereof who are parties to
such proceeding or proceedings, and that all such fees and expenses shall be
reimbursed as they are incurred. The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in this Section 5
is unavailable (other than by reason of the exceptions set forth herein) to an
indemnified party under Section 5(a) or 5(b) hereof in respect of any Losses or
is insufficient to hold such indemnified party harmless, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such Losses, (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the initial placement of the Common Stock pursuant to the Purchase
Agreement. Benefits received by the Holders shall be deemed to be equal to the
value of receiving the Common Stock registered under the Securities Act.
Benefits received by any underwriter shall be deemed to be equal to the total
underwriting discounts and commissions, as set forth on the cover page of the
Prospectus forming a part of the Registration Statement which resulted in such
Losses. The relative fault of the Holders on the one hand and the Company on the
other hand shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to
11.
12
information supplied by the Holders or by the Company and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Holders' respective obligations to contribute
pursuant to this paragraph are several in proportion to the respective number of
Registrable Securities they have sold pursuant to a Registration Statement, and
not joint.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method or allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the Losses
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding this Section 5(d), an
indemnifying party that is a Selling Holder of Registrable Securities shall not
be required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities sold by such indemnifying party and
distributed to the public were offered to the public exceeds the amount of any
damages which such indemnifying party 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.
The indemnity, contribution and expense reimbursement obligations of
the Company hereunder shall be in addition to any liability the Company may
otherwise have hereunder, under the Purchase Agreement or otherwise.
The indemnity and contribution provisions contained in this Section 5
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Holder or any person controlling any Holder, or the Company, its officers or
directors or any person controlling the Company and (iii) the sale of any
Registrable Securities by any Holder.
6. Information Requirements.
(a) The Company shall file the reports required to be filed by it under
the Securities Act and the Exchange Act, and if at any time the Company is not
required to file such reports, it will, upon the request of any Holder of
Registrable Securities, make publicly available other information so long as
necessary to permit sales pursuant to Rule 144 under the Securities Act. The
Company further covenants that it will cooperate with any Holder of Registrable
Securities and take such further reasonable action as any Holder of Registrable
Securities may reasonably request (including, without limitation, making such
reasonable representations as any such Holder may reasonably request), all to
the extent required from time to time to enable such Holder to sell Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144 under the Securities Act. Notwithstanding
the foregoing, nothing in this Section 6 shall be deemed to require the Company
to register any of its securities under any section of the Exchange Act.
12.
13
(b) The Company shall file the reports required to be filed by it under
the Exchange Act and shall comply with all other requirements set forth in the
instructions to the appropriate SEC Registration Statement form permitting
registration of the Registrable Securities for resale by the Holders thereof in
the manner or manners designated by them.
7. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, each Holder of Registrable Securities, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason or a breach by it of any
of the provisions of this Agreement and hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate.
(b) No Conflicting Agreements. The Company has not entered, as of the
date hereof and shall not, on or after the date of this Agreement, enter into
any agreement with respect to its securities which conflicts with the rights
granted to the Holders of Registrable Securities in this Agreement. The Company
represents and warrants that the rights granted to the Holders of Registrable
Securities hereunder do not in any way conflict with the rights granted to the
holders of the Company's securities under any other agreements.
(c) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of Holders of a
Majority of the then outstanding Registrable Securities. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of holders of Registrable
Securities whose securities are being sold pursuant to a Registration Statement
and that does not directly or indirectly affect the rights of other Holders of
Registrable Securities may be given by Holders of at least a majority of the
Registrable Securities being sold by such Holders; provided, that the provisions
of this sentence may not be amended, modified, or supplemented except in
accordance with the provisions of the immediately preceding sentence.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing and shall be deemed given (i) when
made, if made by hand delivery, (ii) upon confirmation, if made by telecopier or
(iii) one business day after being deposited with a reputable next-day courier,
postage prepaid, to the parties as follows:
(x) if to a holder of Registrable Securities, at the most
current address given by such holder to the Company in accordance with
the provisions of Section 7(e):
13.
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and
(y) if to the Company, to:
BOLDER Technologies Corporation
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxx Godward LLP
0000 Xxxxxx Xxxx., Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Telecopy No.: (000) 000-0000
or to such other address as such person may have furnished to the other persons
identified in this Section 7(d) in writing in accordance herewith.
(e) Owner of Registrable Securities. The Company will maintain, or will
cause its registrar and transfer agent to maintain, a register with respect to
the Registrable Securities in which all transfers of Registrable Securities of
which the Company has received notice will be recorded. The Company may deem and
treat the person in whose name Registrable Securities are registered in such
register of the Company as the owner thereof for all purposes, including,
without limitation, the giving of notices under this Agreement.
(f) Approval of Holders. Whenever the consent or approval of Holders of
a specified percentage of Registrable Securities is required hereunder,
Registrable Securities held by the Company or its affiliates (as such term is
defined in Rule 405 under the Securities Act) (other than the Purchasers or
subsequent holders of Registrable Securities if such subsequent holders are
deemed to be such affiliates solely by reason of their holdings of such
Registrable Securities) shall not be counted in determining whether such consent
or approval was given by the Holders of such required percentage.
(g) Successors and Assigns. The Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties and shall
inure to the benefit of and be binding upon each holder of any Registrable
Securities.
(h) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be original and all of which taken together
shall constitute one and the same agreement.
14.
15
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS BY
THE LAWS OF THE STATE OF NEW YORK AS SUCH LAWS ARE APPLIED TO AGREEMENTS BETWEEN
NEW YORK RESIDENTS ENTERED INTO AND PERFORMED ENTIRELY IN NEW YORK, EXCEPT THAT
THE DELAWARE GENERAL CORPORATION LAW WILL GOVERN AS TO MATTERS OF CORPORATE LAW.
(k) Severability. If any term, provision, covenant or restriction of
this Agreement is held to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect, and shall in no way be affected, impaired
or invalidated thereby, and the parties hereto shall use their best efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions without including any of such which may be hereafter declared
invalid, illegal, void or unenforceable.
(l) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and is intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. Except as provided in the
Purchase Agreement, there are no restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein, with respect to
the registration rights granted by the Company with respect to the securities
sold pursuant to the Purchase Agreement. This Agreement supersedes all prior
agreements and understandings among the parties with respect to such subject
matter.
(m) Attorneys' Fees. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party, as determined by the court, shall be
entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
(n) Further Assurances. Each of the parties hereto shall use all
reasonable efforts to take, or cause to be taken, all appropriate action, do or
cause to be done all things reasonably necessary, proper or advisable under
applicable law, and execute and deliver such documents and other papers, as may
be required to carry out the provisions of this Agreement and the other
documents contemplated hereby and consummate the make effective the transactions
contemplated hereby.
(o) Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the end of the Effectiveness Period, except for
any liabilities or obligations under Sections 4 or 5 hereof, each of which shall
remain in effect in accordance with their terms.
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IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
BOLDER TECHNOLOGIES CORPORATION
By:
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President and Chief Executive Officer
Accepted as of the date first above written:
PURCHASER
LEGAL NAME OF PURCHASER:
--------------------------------------------------------
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
Date:
-----------------------------
16.
