REGISTRATION RIGHTS AGREEMENT
Exhibit
10.61
This
Registration Rights Agreement (this “Agreement”)
is
made and entered into as of February 29, 2008, by and between Modtech Holdings,
Inc., a Delaware corporation (the “Company”),
and
Valens Offshore SPV I, Ltd. (the “Purchaser”).
This
Agreement is made pursuant to the Amendment and Waiver Agreement dated as of
the
date hereof among the Purchaser, Laurus Master Fund, Ltd., Valens U.S. SPV
I,
LLC and the Company (the “Amendment
Agreement”),
and
pursuant to the Warrants referred to therein and defined below.
The
Company and the Purchaser hereby agree as follows:
1. Definitions.
Capitalized terms used and not otherwise defined herein that are shall have
the
meanings given to such terms in the Purchase Agreements (as defined in the
Amendment Agreement). As used in this Agreement, the following terms shall
have
the following meanings:
“Amendment
Agreement”
has the
meaning given to such term in the Preamble hereto.
“Commission”
means
the Securities and Exchange Commission.
“Common
Stock”
means
shares of the Company’s common stock, par value $0.01 per share.
“Effectiveness
Date”
means,
(i) with respect to the initial Registration Statement required to be filed
hereunder, a date no later than one hundred eighty (180) days following the
date
hereof and (ii) with respect to each additional Registration Statement required
to be filed hereunder (if any), a date no later than sixty (60) days following
the applicable Filing Date.
“Effectiveness
Period”
has the
meaning set forth in Section 2(a).
“Exchange
Act”
means
the Securities Exchange Act of 1934, as amended, and any successor
statute.
“Filing
Date”
means,
with respect to the Registration Statement required to be filed hereunder in
respect of the shares of Common Stock (a) issuable upon exercise of any Warrant,
the date which is ninety (90) days after the issuance of such Warrant and (b)
with the shares of Common Stock issuable to the Holder as a result of
adjustments to the Exercise Price made pursuant to the Warrant or otherwise,
thirty (30) days after the occurrence of such event.
“Holder”
or
“Holders”
means
the Purchaser or any of its affiliates or transferees to the extent any of
them
hold Registrable Securities, other than those purchasing Registrable Securities
in a market transaction.
“Indemnified
Party”
has the
meaning set forth in Section 5(c).
“Indemnifying
Party”
has the
meaning set forth in Section 5(c).
“Proceeding”
means an
action, claim, suit, investigation or proceeding (including, without limitation,
an investigation or partial proceeding, such as a deposition), whether commenced
or threatened.
“Prospectus”
means
the prospectus included in a Registration Statement (including, without
limitation, a prospectus that includes any 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 prospectus supplement, with respect to the terms of the offering of any
portion of the Registrable Securities covered by such Registration Statement,
and all other amendments and supplements to the Prospectus, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such Prospectus.
“Registrable
Securities”
means
the shares of Common Stock issued upon the exercise of any
Warrants.
“Registration
Statement”
means
each registration statement required to be filed hereunder, including the
Prospectus therein, amendments and supplements to such registration statement
or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.
“Rule
144”
means
Rule 144 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as
such
Rule.
“Rule
415”
means
Rule 415 promulgated by the Commission pursuant to the Securities Act, as such
Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission having substantially the same effect as
such
Rule.
“Securities
Act”
means
the Securities Act of 1933, as amended, and any successor statute.
“Trading
Market”
means
any of the NASD Over The Counter Bulletin Board, NASDAQ Capital Market, the
NASDAQ National Markets System, the American Stock Exchange or the New York
Stock Exchange
“Warrants”
means
the Common Stock purchase warrants dated as of the date hereof issued pursuant
to the Amendment Agreement.
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2. Registration.
(a) On
or
prior to the Filing Date, the Company shall prepare and file with the Commission
a Registration Statement covering the Registrable Securities for a selling
stockholder resale offering to be made on a continuous basis pursuant to Rule
415. The Registration Statement shall be on Form S-3 (except if the Company
is
not then eligible to register for resale the Registrable Securities on Form
S-3,
in which case such registration shall be on another appropriate form in
accordance herewith). The Company may include in a single registration statement
the “Registrable Securities” defined under the Registration Rights Agreements in
paragraphs 3 and 4 of Schedule 7(b) hereto, subject to the requirement that
if
at any time the Commission takes the position that the offering of some or
all
of the Registrable Securities in such combined Registration Statement is not
eligible to be made on a delayed or continuous basis under the provisions of
Rule 415, the Company shall remove from the Registration Statement that number
of the Registrable Securities as defined in the Registration Rights Agreement
described in paragraph 4 of Schedule 7(b) hereto as the Commission may require
to assure the Company’s compliance with the requirements of Rule 415. The
Company shall cause each Registration Statement to become effective and remain
effective as provided herein. The Company shall use its best efforts to cause
each Registration Statement to be declared effective under the Securities Act
as
promptly as possible after the filing thereof, but in any event no later than
the Effectiveness Date. The Company shall use its reasonable commercial efforts
to keep each Registration Statement continuously effective under the Securities
Act until the date which is the earlier date of when (i) all Registrable
Securities covered by such Registration Statement have been sold or (ii) all
Registrable Securities covered by such Registration Statement may be sold
immediately without registration under the Securities Act and without volume
restrictions pursuant to Rule 144(k), (or its successor), as determined by
the
counsel to the Company pursuant to a written opinion letter to such effect,
addressed and acceptable to the Company’s transfer agent and the affected
Holders (the “Effectiveness
Period”).
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(b) If:
(i)
the Registration Statement is not filed on or prior to the Filing Date; (ii)
the
Registration Statement is not declared effective by the Commission by the
Effectiveness Date; (iii) after the Registration Statement is filed with and
declared effective by the Commission, the Registration Statement ceases to
be
effective (by suspension or otherwise) as to all Registrable Securities to
which
it is required to relate at any time prior to the expiration of the
Effectiveness Period (without being succeeded immediately by an additional
registration statement filed and declared effective) for a period of time which
shall exceed thirty (30) days in the aggregate per year (defined as a period
of
365 days commencing on the date the Registration Statement is declared
effective) or more than twenty (20) consecutive calendar days; or (iv) the
Common Stock is not listed or quoted, or is suspended from trading on any
Trading Market for a period of three (3) consecutive Trading Days (provided
the
Company shall not have been able to cure such trading suspension within thirty
(30) days of the notice thereof or list the Common Stock on another Trading
Market); (any such failure or breach being referred to as an “Event,”
and
for purposes of clause (i) or (ii) the date on which such Event occurs, or
for
purposes of clause (iii) the date which such thirty (30) day or twenty (20)
consecutive day period (as the case may be) is exceeded, or for purposes of
clause (v) the date on which such three (3) Trading Day period is exceeded,
being referred to as “Event Date”), then until the applicable Event is cured,
the Company shall pay to each Holder an amount in cash, as liquidated damages
and not as a penalty, equal to 1.0% for each thirty (30) day period (prorated
for partial periods) on a daily basis of the original principal amount of the
“Additional Note” (as defined in the Amendment Agreement) held by the Holder;
provided that, the maximum aggregate amount of liquidated damages that may
be
charged to the Company pursuant to this Section 2(b) shall not exceed 10% of
the
initial principal amount of the Holder’s Additional Note. While such Event
continues, such liquidated damages shall be paid not less often than each thirty
(30) days. Any unpaid liquidated damages as of the date when an Event has been
cured by the Company shall be paid within three (3) days following the date
on
which such Event has been cured by the Company. At its option, the Company
may
pay up to fifty percent (50%) of the liquidated damages (the “Equity
Damage Amount”)
by
delivering from time to time to the Holder, which such deliveries shall occur
simultaneously with delivery to the Holder of the cash portion of the liquidated
damage amounts as required by this Section 2(b), warrants (the “New Warrants”)
substantially identical to the Warrants (except that the per share exercise
price under the New Warrants shall be equal to the par value of the Common
Stock) to purchase that number of shares of Common Stock whose aggregate Fair
Market Value (as hereafter defined) equals the Equity Damage Amount. For
purposes hereof, “Fair
Market Value”
shall
mean the average of the closing price of the Common Stock for the ten (10)
trading days immediately prior to issuance of the applicable New Warrants.
The
shares of Common Stock issuable upon exercise of any New Warrants shall be
included within the definition of Registrable Securities and shall be included
within (I) the initial Registration Statement if the liquidated damages arise
from an Event occurring prior to the date such initial Registration Statement
is
declared effective by the SEC and (II) a new Registration Statement to be filed
on or prior to the applicable Filing Date and declared effective by the SEC
on
or prior to the applicable Effectiveness Date, in the event the liquidated
damages arise from an Event occurring after the date the initial Registration
Statement is declared effective by the SEC.
(c) Within
three (3) business days of the Effectiveness Date, the Company shall cause
its
counsel to issue a blanket opinion in the form attached hereto as Exhibit A,
to
the transfer agent stating that the shares are subject to an effective
registration statement and can be reissued free of restrictive legend upon
notice of a sale by the Purchaser and confirmation by the Purchaser that it
has
complied with the prospectus delivery requirements, provided that the Company
has not advised the transfer agent orally or in writing that the opinion has
been withdrawn. Copies of the blanket opinion required by this Section 2(c)
shall be delivered to the Purchaser within the time frame set forth
above.
3. Registration
Procedures.
If and
whenever the Company is required by the provisions hereof to effect the
registration of any Registrable Securities under the Securities Act, the Company
will, as expeditiously as possible:
(a) prepare
and file with the Commission a Registration Statement with respect to such
Registrable Securities, respond as promptly as possible to any comments received
from the Commission, and use its best efforts to cause the Registration
Statement to become and remain effective for the Effectiveness Period with
respect thereto, and promptly provide to the Purchaser copies of all filings
and
Commission letters of comment relating thereto;
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(b) prepare
and file with the Commission such amendments and supplements to such
Registration Statement and the Prospectus used in connection therewith as may
be
necessary to comply with the provisions of the Securities Act with respect
to
the disposition of all Registrable Securities covered by such Registration
Statement and to keep such Registration Statement effective until the expiration
of the Effectiveness Period applicable to such Registration
Statement;
(c) furnish
to the Purchaser such number of copies of the Registration Statement and the
Prospectus included therein (including each preliminary Prospectus) as the
Purchaser reasonably may request to facilitate the public sale or disposition
of
the Registrable Securities covered by the Registration Statement;
(d) use
its
best efforts to register or qualify the Purchaser’s Registrable Securities
covered by such Registration Statement under the securities or “blue sky” laws
of such jurisdictions within the United States as the Purchaser may reasonably
request, provided, however, that the Company shall not for any such purpose
be
required to qualify generally to transact business as a foreign corporation
in
any jurisdiction where it is not so qualified or to consent to general service
of process in any such jurisdiction;
(e) list
the
Registrable Securities covered by such Registration Statement with any
securities exchange on which the Common Stock of the Company is then
listed;
(f) promptly
(and in any event within three (3) Business Days following such occurrence)
notify the Purchaser at any time when a Prospectus relating thereto is required
to be delivered under the Securities Act, of the happening of any event of
which
the Company has knowledge as a result of which the Prospectus contained in
such
Registration Statement, as then in effect, includes an untrue statement of
a
material fact or omits to state a material fact required to be stated therein
or
necessary to make the statements therein not misleading in light of the
circumstances then existing; and
(g) make
available for inspection by the Purchaser and any attorney, accountant or other
agent retained by the Purchaser, all publicly available, non-confidential
financial and other records, pertinent corporate documents and properties of
the
Company, and cause the Company’s officers, directors and employees to supply all
publicly available, non-confidential information reasonably requested by the
attorney, accountant or agent of the Purchaser.
4. Registration
Expenses.
All
expenses relating to the Company’s compliance with Sections 2 and 3 hereof,
including, without limitation, all registration and filing fees, printing
expenses, fees and disbursements of counsel and independent public accountants
for the Company, fees and expenses (including reasonable counsel fees) incurred
in connection with complying with state securities or “blue sky” laws, fees of
the NASD, transfer taxes, fees of transfer agents and registrars, fees of,
and
disbursements incurred by, one counsel for the Holders are called “Registration
Expenses”. All selling commissions applicable to the sale of Registrable
Securities, including any fees and disbursements of any special counsel to
the
Holders beyond those included in Registration Expenses, are called “Selling
Expenses.” The Company shall only be responsible for all Registration
Expenses.
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5. Indemnification.
(a) In
the
event of a registration of any Registrable Securities under the Securities
Act
pursuant to this Agreement, the Company will indemnify and hold harmless the
Purchaser, and its officers, directors and each other person, if any, who
controls the Purchaser within the meaning of the Securities Act, against any
losses, claims, damages or liabilities, joint or several, to which the
Purchaser, or such persons may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any Registration Statement
under which such Registrable Securities were registered under the Securities
Act
pursuant to this Agreement, any preliminary Prospectus (unless connected in
the
final sale prospectus) or final Prospectus contained therein, or any amendment
or supplement thereof, 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
the
Purchaser, and each such person for any reasonable legal or other expenses
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided,
however,
that
the Company will not be liable in any such case if and to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so made
in
conformity with information furnished by or on behalf of the Purchaser or any
such person in writing specifically for use in any such document.
(b) In
the
event of a registration of the Registrable Securities under the Securities
Act
pursuant to this Agreement, the Purchaser will indemnify and hold harmless
the
Company, and its officers, directors and each other person, if any, who controls
the Company within the meaning of the Securities Act, against all losses,
claims, damages or liabilities, joint or several, to which the Company or such
persons may become subject under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact which was furnished in writing by the Purchaser to the
Company expressly for use in (and such information is contained in) the
Registration Statement under which such Registrable Securities were registered
under the Securities Act pursuant to this Agreement, any preliminary Prospectus
or final Prospectus contained therein, or any amendment or supplement thereof,
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 the Company and each
such
person for any reasonable legal or other expenses incurred by them in connection
with investigating or defending any such loss, claim, damage, liability or
action, provided,
however,
that
the Purchaser will be liable in any such case if and only to the extent that
any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so made
in
conformity with information furnished in writing to the Company by or on behalf
of the Purchaser specifically for use in any such document. Notwithstanding
the
provisions of this paragraph, the Purchaser shall not be required to indemnify
any person or entity in excess of the amount of the aggregate net proceeds
received by the Purchaser in respect of Registrable Securities in connection
with any such registration under the Securities Act.
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(c) Promptly
after receipt by a party entitled to claim indemnification hereunder (an
“Indemnified
Party”)
of
notice of the commencement of any action, such Indemnified Party shall, if
a
claim for indemnification in respect thereof is to be made against a party
hereto obligated to indemnify such Indemnified Party (an “Indemnifying
Party”),
notify the Indemnifying Party in writing thereof, but the omission so to notify
the Indemnifying Party shall not relieve it from any liability which it may
have
to such Indemnified Party other than under this Section 5(c) and shall only
relieve it from any liability which it may have to such Indemnified Party under
this Section 5(c) if and to the extent the Indemnifying Party is prejudiced
by
such omission. In case any such action shall be brought against any Indemnified
Party and it shall notify the Indemnifying Party of the commencement thereof,
the Indemnifying Party shall be entitled to participate in and, to the extent
it
shall wish, to assume and undertake the defense thereof with counsel
satisfactory to such Indemnified Party, and, after notice from the Indemnifying
Party to such Indemnified Party of its election so to assume and undertake
the
defense thereof, the Indemnifying Party shall not be liable to such Indemnified
Party under this Section 5(c) for any legal expenses subsequently incurred
by
such Indemnified Party in connection with the defense thereof; if the
Indemnified Party retains its own counsel, then the Indemnified Party shall
pay
all fees, costs and expenses of such counsel, provided,
however,
that,
if the defendants in any such action include both the Indemnified Party and
the
Indemnifying Party and counsel for the Indemnified Party shall have reasonably
concluded that there may be reasonable defenses available to the Indemnified
Party which are different from or additional to those available to the
Indemnifying Party or if counsel for the Indemnified Party shall have reasonably
concluded that the interests of the Indemnified Party may reasonably be deemed
to conflict with the interests of the Indemnifying Party, the Indemnified Party
shall have the right to select one separate counsel and to assume such legal
defenses and otherwise to participate in the defense of such action, with the
reasonable expenses and fees of such separate counsel and other expenses related
to such participation to be reimbursed by the Indemnifying Party as
incurred.
(d) In
order
to provide for just and equitable contribution in the event of joint liability
under the Securities Act in any case in which either (i) the Purchaser, or
any
officer, director or controlling person of the Purchaser, makes a claim for
indemnification pursuant to this Section 5 but it is judicially determined
(by
the entry of a final judgment or decree by a court of competent jurisdiction
and
the expiration of time to appeal or the denial of the last right of appeal)
that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 5 provides for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of the
Purchaser or such officer, director or controlling person of the Purchaser
in
circumstances for which indemnification is provided under this Section 5; then,
and in each such case, the Company and the Purchaser will contribute to the
aggregate losses, claims, damages or liabilities to which they may be subject
(after contribution from others) in such proportion so that the Purchaser is
responsible only for the portion represented by the percentage that the public
offering price of its securities offered by the Registration Statement bears
to
the public offering price of all securities offered by such Registration
Statement, provided,
however,
that,
in any such case, (A) the Purchaser will not be required to contribute any
amount in excess of the public offering price of all such securities offered
by
it pursuant to such Registration Statement; and (B) no person or entity guilty
of fraudulent misrepresentation (within the meaning of Section 10(f) of the
Act)
will be entitled to contribution from any person or entity who was not guilty
of
such fraudulent misrepresentation.
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6. Representations
and Warranties.
(a) The
Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange
Act and, except with respect to certain matters which the Company has disclosed
to the Purchaser on Schedule
4.21
to the
Purchase Agreements, the Company has filed all proxy statements, reports,
schedules, forms, statements and other documents required to be filed by it
under the Exchange Act. The Company has filed (i) its Annual Report on Form
10-K
for its fiscal year ended December 31, 2006 and (ii) its Quarterly Report on
Form 10-Q for the fiscal quarters ended March 31, 2007, June 30, 2007 and
September 30, 2007
(collectively, the “SEC
Reports”).
Each
SEC Report was, at the time of its filing, in substantial compliance with the
requirements of its respective form and none of the SEC Reports, nor the
financial statements (and the notes thereto) included in the SEC Reports, as
of
their respective filing dates, contained any untrue statement of a material
fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading. The financial statements of the Company included
in
the SEC Reports comply as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the
Commission or other applicable rules and regulations with respect thereto.
Such
financial statements have been prepared in accordance with generally accepted
accounting principles (“GAAP”)
applied on a consistent basis during the periods involved (except (i) as may
be
otherwise indicated in such financial statements or the notes thereto or (ii)
in
the case of unaudited interim statements, to the extent they may not include
footnotes, customary year-end adjustments, or may be condensed) and fairly
present in all material respects the financial condition, the results of
operations and the cash flows of the Company and its subsidiaries, on a
consolidated basis, as of, and for, the periods presented in each such SEC
Report.
(b) The
Common Stock is listed or quoted, as applicable, for trading on the NASDAQ
Global Market and, except as set forth below, satisfies all requirements for
the
continuation of such listing or quotation, as applicable, and the Company shall
do all things necessary for the continuation of such listing or quotation,
as
applicable. Except as set forth below, the Company has not received any notice
that its Common Stock will be delisted from or no longer be quoted on, as
applicable, the NASDAQ Global Market (except for prior notices which have been
fully remedied) or that the Common Stock does not meet all requirements for
the
continuation of such listing or quotation, as applicable. On January 16, 2008,
the Company received a letter from The Nasdaq Stock Market notifying it that
for
the 30 consecutive business days preceding the date of the letter the bid price
of the Company’s common stock had closed below the $1.00 per share minimum bid
price required for continued inclusion on The Nasdaq Global Market pursuant
to
Nasdaq Marketplace Rule 4450(a) (5). In accordance with Nasdaq Marketplace
Rule
4450(e) (2), the Company has 180 calendar days from the date of the Nasdaq
letter, or until July 14, 2008, to regain compliance with the minimum bid price
rule.
(c) Neither
the Company, nor any of its affiliates, nor any person acting on its or their
behalf, has directly or indirectly made any offers or sales of any security
or
solicited any offers to buy any security under circumstances that would cause
the offering of the Securities pursuant to the Amendment Agreement to be
integrated with prior offerings by the Company for purposes of the Securities
Act which would prevent the Company from selling the Common Stock pursuant
to
Rule 506 under the Securities Act, or any applicable exchange-related
stockholder approval provisions, nor will the Company or any of its affiliates
or subsidiaries take any action or steps that would cause the offering of the
Securities to be integrated with other offerings.
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(d) The
Warrants and the shares of Common Stock that the Purchaser may acquire pursuant
to any Warrants are all restricted securities under the Securities Act as of
the
date of this Agreement. The Company will not issue any stop transfer order
or
other order impeding the sale and delivery of any of the Registrable Securities
at such time as such Registrable Securities are registered for public sale
or it
has received an opinion of counsel that an exemption from registration is
available, except as required by federal or state securities laws.
(e) The
Company understands the nature of the Registrable Securities issuable upon
the
exercise of any Warrants and recognizes that the issuance of such Registrable
Securities may have a potential dilutive effect. The Company specifically
acknowledges that its obligation to issue the Registrable Securities is binding
upon the Company and enforceable regardless of the dilution such issuance may
have on the ownership interests of other shareholders of the
Company.
(f) Except
for agreements made in the ordinary course of business, there is no agreement
that has not been filed with the Commission as an exhibit to a registration
statement or to a form required to be filed by the Company under the Exchange
Act, the breach of which could reasonably be expected to have a material and
adverse effect on the Company and its subsidiaries, or would prohibit or
otherwise interfere with the ability of the Company to enter into and perform
any of its obligations under this Agreement in any material
respect.
(g) The
Company will at all times have authorized and reserved a sufficient number
of
shares of Common Stock for the full exercise of the Warrants.
(h) The
Company shall provide written notice to each Holder of (i) the occurrence of
each Discontinuation Event (as defined below) and (ii) the declaration of
effectiveness by the SEC of each Registration Statement required to be filed
hereunder, in each case within one (1) business day of the date of each such
occurrence and/or declaration.
7. Miscellaneous.
(a) Remedies.
In the
event of a breach by the Company or by a Holder, of any of their respective
obligations under this Agreement, each Holder or the Company, as the case may
be, in addition to being entitled to exercise all rights granted by law and
under this Agreement, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement.
(b) No
Piggyback on Registrations.
Except
as and to the extent set forth on Schedule 7(b) hereto, neither the Company
nor
any of its security holders (other than the Holders in such capacity pursuant
hereto) may include securities of the Company in any Registration Statement
other than the Registrable Securities, and the Company shall not after the
date
hereof enter into any agreement providing any such right for inclusion of shares
in the Registration Statement to any of its security holders. Except as and
to
the extent specified in Schedule
7(b)
hereto,
the Company has not previously entered into any agreement granting any
registration rights with respect to any of its securities to any person or
entity that have not been fully satisfied.
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(c) Compliance.
Each
Holder covenants and agrees that it will comply with the prospectus delivery
requirements of the Securities Act as applicable to it in connection with sales
of Registrable Securities pursuant to each Registration Statement.
(d) Discontinued
Disposition.
Each
Holder agrees by its acquisition of such Registrable Securities that, upon
receipt of a notice from the Company of the occurrence of a Discontinuation
Event (as defined below), such Holder will forthwith discontinue disposition
of
such Registrable Securities under the applicable Registration Statement until
such Holder’s receipt of the copies of the supplemented Prospectus and/or
amended Registration Statement or until it is advised in writing (the
“Advice”)
by the
Company that the use of the applicable Prospectus may be resumed, and, in either
case, has received copies of any additional or supplemental filings that are
incorporated or deemed to be incorporated by reference in such Prospectus or
Registration Statement. The Company may provide appropriate stop orders to
enforce the provisions of this paragraph. For purposes of this Agreement, a
“Discontinuation
Event”
shall
mean (i) when the Commission notifies the Company whether there will be a
“review”
of
such
Registration Statement and whenever the Commission comments in writing on such
Registration Statement (the Company shall provide true and complete copies
thereof and all written responses thereto to each of the Holders); (ii) any
request by the Commission or any other Federal or state governmental authority
for amendments or supplements to such Registration Statement or Prospectus
or
for additional information; (iii) the issuance by the Commission of any stop
order suspending the effectiveness of such Registration Statement covering
any
or all of the Registrable Securities or the initiation of any Proceedings for
that purpose; (iv) 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 Proceeding for such purpose; and/or (v) the occurrence of
any
event or passage of time that makes the financial statements included in such
Registration Statement ineligible for inclusion therein or any statement made
in
such Registration Statement or Prospectus or any document incorporated or deemed
to be incorporated therein by reference untrue in any material respect or that
requires any revisions to such Registration Statement, Prospectus or other
documents so that, in the case of such Registration Statement or Prospectus,
as
the case may be, 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 light of the circumstances under which they
were
made, not misleading.
(e) Piggy-Back
Registrations.
If at
any time after the date hereof there is not an effective Registration Statement
covering all of the Registrable Securities required to be covered hereunder
and
the Company shall determine to prepare and file with the Commission a
registration statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity securities,
other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to
be
issued solely in connection with any acquisition of any entity or business
or
equity securities issuable in connection with stock option or other employee
benefit plans, then the Company shall send to each Holder written notice of
such
determination and, if within fifteen (15) days after receipt of such notice,
any
such Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
Holder requests to be registered, to the extent the Company may do so without
violating registration rights of others which exist as of the date of this
Agreement, subject to customary underwriter cutbacks applicable to all holders
of registration rights and subject to obtaining any required consent of any
selling stockholder(s) to such inclusion under such registration
statement.
10
(f) 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 same shall be in writing
and
signed by the Company and the Holders 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 certain Holders and that does not directly or indirectly affect the
rights of other Holders may be given by Holders of at least a majority of the
Registrable Securities to which such waiver or consent relates; provided,
however,
that
the provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the immediately preceding
sentence.
(g) Notices.
Any
notice or request hereunder may be given to the Company or the Purchaser at
the
respective addresses set forth below or as may hereafter be specified in a
notice designated as a change of address under this Section 7(g). Any notice
or
request hereunder shall be given by registered or certified mail, return receipt
requested, hand delivery, overnight mail, Federal Express or other national
overnight next day carrier (collectively, “Courier”)
or
telecopy (confirmed by mail). Notices and requests shall be, in the case of
those by hand delivery, deemed to have been given when delivered to any party
to
whom it is addressed, in the case of those by mail or overnight mail, deemed
to
have been given three (3) business days after the date when deposited in the
mail or with the overnight mail carrier, in the case of a Courier, the next
business day following timely delivery of the package with the Courier, and,
in
the case of a telecopy, when confirmed. The address for such notices and
communications shall be as follows:
|
If
to the Company:
|
Modtech
Holdings, Inc.
0000
Xxxxxxx Xxxxxx
Xxxxxx,
Xxxxxxxxxx 00000
Attention: Chief
Financial Officer
Facsimile:
(000) 000-0000
|
|
with
a copy to:
|
Xxxxxx
& Zepfel LLP
000
Xxxxxxx Xxxxxx Xxxxx
Xxxxx
000
Xxxxxxx
Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx
X. Xxxxxx, Esq.
Facsimile: (000)
000-0000
|
|
If
to a Purchaser:
|
To
the address set forth under such Purchaser name on the signature
pages
hereto.
|
|
If
to any other Person who is then
the
registered Holder:
|
To
the address of such Holder as it appears in the stock transfer books
of
the Company
|
11
or
such
other address as may be designated in writing hereafter in accordance with
this
Section 7(g) by such Person.
(h) Successors
and Assigns.
This
Agreement shall inure to the benefit of and be binding upon the successors
and
permitted assigns of each of the parties and shall inure to the benefit of
each
Holder. The Company may not assign its rights or obligations hereunder without
the prior written consent of each Holder. Each Holder may assign their
respective rights hereunder in the manner and to the persons and entities as
permitted under the Purchase Agreements.
(i) Execution
and Counterparts.
This
Agreement may be executed in any number of counterparts, each of which when
so
executed shall be deemed to be an original and, all of which taken together
shall constitute one and the same agreement. In the event that any signature
is
delivered by facsimile transmission, such signature shall create a valid binding
obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
were the original thereof.
(j) Governing
Law, Jurisdiction and Waiver of Jury Trial.
THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH
THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN
SUCH
STATE, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. The Company hereby
consents and agrees that the state or federal courts located in the County
of
New York, State of New York shall have exclusion jurisdiction to hear and
determine any Proceeding between the Company, on the one hand, and the
Purchaser, on the other hand, pertaining to this Agreement or to any matter
arising out of or related to this Agreement; provided,
that
the Purchaser and the Company acknowledge that any appeals from those courts
may
have to be heard by a court located outside of the County of New York, State
of
New York, and further provided,
that
nothing in this Agreement shall be deemed or operate to preclude the Purchaser
from bringing a Proceeding in any other jurisdiction to collect the obligations,
to realize on the Collateral or any other security for the obligations, or
to
enforce a judgment or other court order in favor of the Purchaser. The Company
expressly submits and consents in advance to such jurisdiction in any Proceeding
commenced in any such court, and the Company hereby waives any objection which
it may have based upon lack of personal jurisdiction, improper venue or
forum
non conveniens.
The
Company hereby waives personal service of the summons, complaint and other
process issued in any such Proceeding and agrees that service of such summons,
complaint and other process may be made by registered or certified mail
addressed to the Company at the address set forth in Section 7(g) and that
service so made shall be deemed completed upon the earlier of the Company’s
actual receipt thereof or three (3) days after deposit in the U.S. mails, proper
postage prepaid. The parties hereto desire that their disputes be resolved
by a
judge applying such applicable laws. Therefore, to achieve the best combination
of the benefits of the judicial system and of arbitration, the parties hereto
waive all rights to trial by jury in any Proceeding brought to resolve any
dispute, whether arising in contract, tort, or otherwise between the Purchaser
and/or the Company arising out of, connected with, related or incidental to
the
relationship established between then in connection with this Agreement. If
either party hereto shall commence a Proceeding to enforce any provisions of
this Agreement, the Purchase Agreements, the Amendment Agreement or any other
Related Agreement, then the prevailing party in such Proceeding shall be
reimbursed by the other party for its reasonable attorneys’ fees and other costs
and expenses incurred with the investigation, preparation and prosecution of
such Proceeding.
12
(k) Cumulative
Remedies.
The
remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
(l) Severability.
If any
term, provision, covenant or restriction of this Agreement is held by a court
of
competent jurisdiction 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, and the parties hereto shall use their reasonable 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 that may be hereafter declared
invalid, illegal, void or unenforceable.
(m) Headings.
The
headings in this Agreement are for convenience of reference only and shall
not
limit or otherwise affect the meaning hereof.
IN
WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
as
of the date first written above.
|
By:
|
/s/
Xxxxxxx X. Xxxxxx
|
|
Name:
|
Xxxxxxx
X. Xxxxxx
|
|
Title:
|
Chief
Financial Officer
|
|
VALENS
OFFSHORE SPV I, LTD.
|
|
|
By:
|
Valens
Capital Management, LLC, its
investment
manager
|
|
By:
|
/s/
Xxxxxxx Xxxxx
|
|
Name:
|
Xxxxxxx
Xxxxx
|
|
Title:
|
Authorized
Signatory
|
13
|
Address
for Notices:
|
|
|
Valens
Offshore SPV I, Ltd.
|
|
|
c/o
Valens Capital Management, LLC
|
|
|
000
Xxxxxxx Xxxxxx, 00xx Xxxxx
|
|
|
Xxx
Xxxx, Xxx Xxxx 00000
|
|
|
Attention: Portfolio
Services
|
|
|
Facsimile: 000-000-0000
|
14
EXHIBIT
A
____________,
200___
[Continental
Stock Transfer
&
Trust Company
Two
Xxxxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attn:
Xxxxxxx Xxxxxxxxx]
|
Re:
|
Modtech
Holdings, Inc. Registration Statement on Form
[S-3]
|
Ladies
and Gentlemen:
As
counsel to Modtech Holdings, Inc., a Delaware corporation (the “Company”),
we
have been requested to render our opinion to you in connection with the resale
by the individuals or entitles listed on Schedule
A
attached
hereto (the “Selling
Stockholders”),
of an
aggregate of __________ shares (the “Shares”)
of the
Company’s Common Stock.
A
Registration Statement on Form [S-3]
under
the Securities Act of 1933, as amended (the “Act”),
with
respect to the resale of the Shares was declared effective by the Securities
and
Exchange Commission on [date].
Enclosed is the Prospectus dated [date].
We
understand that the Shares are to be offered and sold in the manner described
in
the Prospectus.
This
letter shall serve as our notice to you that the Shares are, as of this date,
freely transferable by the Selling Stockholders pursuant to the Registration
Statement. Unless you receive separate notice or instructions from us following
the date hereof, you need not require further letters from us to effect any
future legend-free issuance or re-issuance of the Shares.
Very
truly yours,
[Company
counsel]
15
Schedule
A to Exhibit A
|
Selling
Stockholder
|
R/N/O
|
Shares
Being
Offered
|
||
16
SCHEDULE
7(b)
1. The
Company is a party to the First Amended and Restated Registration Rights
Agreement with Amphora Limited, Peninsula Catalyst Fund, L.P., and others,
dated
August 5, 2005 and to a Registration Rights Agreement with Amphora Limited,
dated October 31, 2006, with respect to 189,189 shares of common stock The
registration statements described in these agreements have been declared
effective, but there are ongoing obligations under the agreements, including
indemnification provisions.
2. [intentionally
omitted]
3. The
Company is also a party to a Registration
Rights Agreement with
Valens U.S. SPV I, LLC, dated February 29, 2008, with respect to 195,935 shares
of common stock and a Registration Rights Agreement with Valens Offshore SPV
I,
LTD, also dated February 29, 2008 with respect to 266,408 shares of common
stock. The registration statements described in these two Registration Rights
Agreements have not yet been filed.
4. The
Company intends to enter into a single Registration Rights Agreement in the
next
10 days with various investors to register between approximately 3,125,000
and
4,166,667 shares of common stock to be issued upon conversion of convertible
preferred stock to be issued to such investors.
5.
Outstanding
Warrants
Warrants
to acquire the number of shares of common stock at the exercise prices set
forth
below are currently outstanding and exercisable:
|
No.
of Shares of Common Stock
|
Exercise
Price
|
|||
|
770,349
|
$
|
7.82
|
||
|
770,348
|
$
|
7.31
|
||
|
581,395
|
$
|
5.69
|
||
|
192,029
|
$
|
5.06
|
||
|
$
|
5.29
|
|||
|
192,028
|
$
|
6.53
|
||
The
warrants were originally issued to Laurus Master Fund, Ltd.
17
