EXHIBIT 10.36
REGISTRATION RIGHTS AGREEMENT
by and between
SATCON TECHNOLOGY CORPORATION
and
XXXXXXXX GRUMMAN CORPORATION
Dated as of
November 16, 1999
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and
effective as of November 16, 1999, by and between Satcon Technology Corporation,
a Delaware corporation (the "Company") and Northrop Grumman Corporation, a
Delaware corporation ("Northrop").
RECITALS
A. Upon the terms and subject to the conditions of an Asset Purchase
Agreement dated as of November 16, 1999 (the "APA"), by and among the Company,
and Northrop, the Company will acquire assets of Northrop's Power Electronics
Business Unit and the Company will issue 578,761 shares of the common stock, $_
par value ("Common Stock") of the Company to Northrop and one or more Warrants
to purchase Common Stock of the Company.
B. A material inducement for Northrop to consummate the transactions
contemplated by the APA was that the Company enter into this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements of the parties contained herein, the parties agree as
follows:
1. Definitions. As used herein, the terms below shall have the following
meanings. Any such term, unless the context otherwise requires, may be used in
the singular or plural, depending upon the reference.
"Affiliate" shall have the meaning provided in the Exchange Act and the
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rules and regulations of the Commission promulgated thereunder.
"Agreement" shall mean this Registration Rights Agreement.
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"Commission" shall mean the United States Securities and Exchange
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Commission.
"Common Stock" shall have the meaning provided in Recital A.
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"Company" shall mean Satcon Technology Corporation.
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"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
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or any successor law, and the rules and regulations issued pursuant to that
Act or any successor law.
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"Holder" shall mean any Person to which or whom Northrop transfers all or
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part of its Registered Shares or Warrant but only pursuant to an exemption
from registration under the Securities Act, or any permitted assignee
thereof in accordance with Section 19.
"APA" shall have the meaning provided in Recital A.
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"Person" shall mean an individual, partnership, limited liability company,
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joint venture, corporation, trust or unincorporated organization or any
other similar entity.
"Register," "registered" and "registration" shall refer to a registration
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effected by preparing and filing a registration statement or similar
document in compliance with the Securities Act, and the declaration or
ordering of effectiveness of such registration statement or document by the
Commission.
"Registrable Shares" shall mean (a) the Shares acquired by Northrop
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pursuant to the APA or upon exercise of the Warrant and (b) any Common
Stock of the Company issued to Northrop as a dividend or other distribution
with respect to, or in exchange for or in replacement of, any of the
Shares; provided, however, that shares of Common Stock shall only be
treated as Registrable Shares if and so long as (1) they have not been sold
by Northrop or any Holder thereof to or through a broker or dealer or
underwriter in a public distribution or otherwise pursuant to an effective
Registration Statement under the Securities Act, (ii) they have not been
sold in a transaction exempt from the registration and prospectus delivery
requirements of the Securities Act under Section 4(1) thereof so that all
transfer restrictions and restrictive legends with respect thereto are
removed upon the consummation of such sale, or (iii) are not freely
tradable pursuant to Rule 144(k) under the Securities Act without any
volume limitation.
"Registration" shall mean a registration made pursuant to Section 2.
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"Securities Act" shall mean the Securities Act of 1933, as amended, or any
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successor law, and the rules and regulations issued pursuant to that Act or
any successor law.
"Shares" shall mean the shares of Common Stock issued and sold by the
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Company to Northrop pursuant to the APA and shares of Common Stock issued
and sold by the Company to Northrop or a Holder upon exercise of the
Warrant.
"Violation" shall have the meaning provided in Section 6(a).
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"Warrants" shall mean the warrants represented by two (2) certificates
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(delivery to Northrop of one of which is subject to fulfillment of a post-
Closing condition as stated in the APA) each entitling Northrop to purchase
100,000 Shares of the
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Company for the price per share as stated in the form of Warrant
Certificate annexed to the APA.
2. Registration.
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(a) Commercially Reasonable Efforts. Upon the request of Northrop,
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which Northrop shall have the right to do only once with respect to the
Registrable Shares issued at the Closing under the APA and only once with
respect to the Registrable Shares acquired upon exercise of one or both of
the Warrants, the Company shall use its best efforts (without regard to
expenses) to file as soon as practicable hereafter, a registration
statement (the "Registrate Statement") under the Securities Act for resale
of the Registrable Shares which the Company has been notified along with
the request should be included therein by Northrop and shall use its
commercially reasonable efforts to cause such registration statement to
become effective as soon as practicable after each such notice thereafter
and to stay effective for a period of one year after the effectiveness of
each such registration. Northrop has simultaneously herewith delivered the
request for registration of the Registrable Shares issued at Closing of the
APA. Alternatively, the Company may (i) include such Registrable Shares in
an existing effective registration statement of the Company by post
effective amendment with respect to such resale so long as the Northrop and
the Holders are otherwise provided with all of the rights afforded each of
them hereunder or (ii) exchange the Registrable Shares on a one for one
basis for fully registered shares which are freely tradable to the same
extent as if the shares had been the subject of a registration for resale
of such shares as otherwise provided herein ("Registered Shares") provided
such exchange registration is permitted under the Securities Act. If the
Company elects alternative (ii), the Company agrees to exchange Registrable
Shares for Registered Shares. Notwithstanding anything in this Section 2,
the Purchaser may, by written notice to the Seller (i) delay the filing or
effectiveness of the Registration Statement or (ii) suspend the
Registration Statement after effectiveness and require that the Seller
immediately cease sales of shares pursuant thereto in the event that (A)
the Purchaser files a registration statement (other than a registration
statement on Form S-8 or its successor form) with the SEC for a public
offering of its securities or (B) the Purchaser engages in any activity or
transaction that the Purchaser desires to keep confidential for business
reasons, if the Purchaser determines in good faith that the public
disclosure requirements imposed on the Purchaser under the Securities Act
in connection with the Registration Statement covering the Shares would
require disclosure of such activity, transaction, preparations or
negotiations or (C) the Company is in the "registration process" with
respect to an underwritten public offering; provided that each day of delay
or suspension shall not count toward the applicable one year period
referred to above.
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(b) Expenses of Registration. All expenses (other than underwriting
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discounts and commissions, stock transfer taxes and the fees and
disbursements of separate counsel, if any, retained by Northrop or the
Holders) incurred in connection with each Registration, including (without
limitation) all registration, filing and qualification fees, printers'
fees, accounting fees, and fees and disbursements of counsel for the
Company, shall be borne by the Company.
3. Obligations of the Company. Whenever required under this Agreement to
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effect the registration of any Registrable Shares, the Company shall, as
expeditiously as reasonably possible, use reasonable commercial efforts (without
regard to expense) to do the following:
(a) Amendments. Prepare and file with the Commission such amendments
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and supplements to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply
with the provisions of the Securities Act with respect to the disposition
of all securities covered by such registration statement, and furnish such
copies thereof to Northrop and the Holders.
(b) Prospectus. Furnish to Northrop and the Holders such numbers of
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copies of a prospectus, including a preliminary prospectus, and any post-
effective amendments in conformity with the requirements of the Securities
Act, and such other documents as they may reasonably request in order to
facilitate the disposition of Registrable Shares owned by them, and cause
all related filings to be made with the Commission as required by Rule 424.
(c) Blue Sky Qualification. Register and qualify the Registrable
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Shares covered by such registration statement under such other securities
or Blue Sky laws of such jurisdictions as shall be reasonably requested by
Northrop and the Holders; provided, however, that the Company shall not be
required in connection therewith or as a condition thereto to qualify to do
business or to file a general consent to service of process in any such
states or jurisdictions.
(d) Prospectus Delivery. Promptly notify Northrop and each Holder of
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Registrable Shares covered by the registration statement at any time when
the Company becomes aware of the happening of any event as a result of
which the registration statement or the prospectus included in such
registration statement or any supplement to the prospectus (as then in
effect) contains any untrue statement of a material fact or omits to state
a material fact necessary to make the statements therein (in the case of
the prospectus, in light of the circumstances under which they were made)
not misleading or, if for any other reason it shall be necessary during
such time period to amend or supplement the registration statement or the
prospectus in order to comply with the Securities Act, whereupon, in either
case, each Holder shall immediately cease to use such registration
statement or prospectus for any purpose and, as promptly as practicable
thereafter, the
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Company shall promptly prepare and file with the Commission, and furnish
without charge to Northrop and the Holders, a supplement or amendment to
such registration statement or prospectus which will correct such statement
or omission or effect such compliance and such copies thereof as Northrop
and the Holders may reasonably request.
(e) Suspensions. The Company shall use its reasonable best efforts to
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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.
(f) Certificates. The Company shall cooperate with the selling by
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Northrop and Holders of Registrable Securities to facilitate the timely
preparation and delivery of certificates representing Registrable
Securities to be sold, which certificates shall not bear any restrictive
legends.
(g) Earnings Statements. The Company shall comply with all applicable
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rules and regulations of the SEC and make generally available to its
security holders earnings statements satisfying the provisions of Section
11 (a) of the Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act).
4. Furnish Information. It shall be a condition precedent to the
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obligations of the Company to take any action pursuant to this Agreement with
respect to the Registrable Shares of Northrop that Northrop (i) shall furnish to
the Company such information regarding itself, the Registrable Shares held by it
and the intended method of disposition of such securities as shall be required
to effect the registration of Northrop and such Holder's Registrable Shares and
(ii) shall agree in writing to observe all obligations applicable to a "Holder"
under this Agreement.
5. Delay of Registration. Neither Northrop nor any Holder shall have any
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right to obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Agreement.
6. Indemnification. In the event any Registrable Shares are included in
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a registration statement under this Agreement:
(a) Indemnification by the Company. To the fullest extent permitted
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by law, the Company will indemnify and hold harmless Northrop, each Holder,
any underwriter (as defined in the Securities Act) for Northrop and such
Holder and each person, if any, who controls Northrop or such Holder or
underwriter within the meaning of the Securities Act or the Exchange Act,
against any losses, claims, damages, or liabilities, joint or several) to
which they may become subject under the Securities Act, the Exchange Act,
or other federal or state law, insofar as such
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losses, claims, damages, or liabilities (or actions in respect thereof)
arise out of or are based upon any of the following statements, omissions
or violations (collectively a "Violation"): (i) any untrue statement or
alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus
contained therein or any amendments or supplements thereto, (ii) 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, or (iii) any violation or alleged violation by the Company of
the Securities Act, the Exchange Act or any state securities law or any
rule or regulation promulgated under the Securities Act, the Exchange Act
or any state securities law, and the Company will pay to Northrop and each
such Holder, director, underwriter or controlling person, as incurred, any
legal or other expenses reasonably incurred by one law firm retained by
them, plus appropriate local counsel in connection with investigating or
defending any such loss, claim, damage, liability, or action; provided,
however, that the indemnity agreement contained in this Section 6(a) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability, or action if such settlement is effected without the consent of
the Company (which consent shall not be unreasonably withheld), nor shall
the Company be liable in any such case for any such loss, claim, damage,
liability, or action to which Northrop or any Holder, underwriter or
controlling person may become subject to the extent that it arises out of
or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in
connection with such registration by Northrop or such Holder, underwriter
or controlling person or in connection with the sale by Northrop or others
during any period when a registration statement has not been declared
effective, sales are suspended or Northrop or others fail to deliver a
prospectus or utilize a prospectus that Northrop has been advised is
inaccurate. This right to indemnification shall remain in full force and
effect notwithstanding any investigation made by or on behalf of Northrop
and such Holder or underwriter and shall survive the transfer of such
securities by Northrop and such Holder.
(b) Indemnification by Northrop and Holder. To the fullest extent
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permitted by law, Northrop for itself and each Holder, will indemnify and
hold harmless the Company, each of its directors, each of its officers who
has signed the registration statement, each person, if any, who controls
the Company within the meaning of the Securities Act or the Exchange Act,
any underwriter, each other Holder and any controlling person of any such
underwriter or other Holder against any losses, claims, damages, or
liabilities, joint or several) to which any of the foregoing persons may
become subject under the Securities Act, the Exchange Act or other federal
or state law, insofar as such losses, claims, damages, or liabilities (or
actions in respect thereto) arise out of or are based upon any Violation,
in each case to the extent (and only to the extent) that such Violation
occurs in reliance upon and in conformity with written information
furnished by Northrop or such Holder expressly for use in connection with
such registration or
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in connection with any sale by Northrop or others during any period when a
Registration Statement has not been declared effective, sales are suspended
or Northrop or others fail to deliver a prospectus or utilize a prospectus
that Northrop has been advised is inaccurate; provided, however, that the
indemnity agreement contained in this Section 6(b) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or
action if such settlement is effected without the consent of Northrop and
the Holder, which consent shall not be unreasonably withheld; provided,
further, that in no event shall any indemnity under this Section 6(b)
exceed the net proceeds from the offering received by Northrop or such
Holder.
(c) Procedures. Promptly after receipt by an indemnified party under
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this Section 6 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 6,
deliver to the indemnifying party a written notice of the commencement
thereof and the indemnifying party shall have the right to participate in,
and, to the extent the indemnifying party so desires, jointly with any
other indemnifying party similarly noticed, to assume the defense thereof
with counsel mutually satisfactory to the parties; provided, however, that
an indemnified party (together with all other indemnified parties which may
be represented without conflict by one counsel reasonably acceptable to the
Company) shall have the right to retain one separate counsel (plus
appropriate local counsel), with the fees and expenses to be paid by the
indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to
actual or potential differing interests between such indemnified party and
any other party represented by such counsel in such proceeding. The failure
to deliver written notice to the indemnifying party within a reasonable
time of the commencement of any such action, if prejudicial in any material
respect to its ability to defend such action, shall to the extent
prejudicial relieve such indemnifying party of any liability to the
indemnified party under this Section 6, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any
liability that it may have to any indemnified party otherwise than under
this Section 6.
(d) Contribution. If the indemnification provided for in this Section
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6 from the indemnifying party is unavailable to an indemnified party
hereunder in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then the indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims,
damages, liabilities or expenses in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand and
the indemnified party or parties on the other in connection with the
actions which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The
relative fault of such indemnifying party and indemnified parties shall be
determined by reference to,
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among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission
to state a material fact, has been made by, or related to information
supplied by, such indemnifying party or indemnified parties, and the party
or parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such action; provided, however, that in
no event shall the liability of Northrop hereunder be greater in amount
than the difference between the dollar amount of the proceeds received by
Northrop and all Holders upon the sale of the Registrable Shares giving
rise to such contribution obligation and all amounts previously contributed
by Northrop with respect to such losses, claims, damages, liabilities and
expenses. The amount paid or payable to a party as a result of the losses,
claims damages, liabilities and expenses referred to above shall be deemed
to include any legal or other fees or expenses reasonably incurred by such
party in connection with any investigation or proceeding.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 6(d) were determined by pro rata
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allocation or by any other method of allocation which does not take into
account the equitable considerations referred to in the immediately
preceding paragraph. 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.
(e) Survival. The obligations of the Company and Northrop and any
Holders under this Section 6 shall survive the completion of any offering
of Registrable Shares in a registration statement under this Agreement, and
otherwise.
7. Reports Under Exchange Act. With a view to making available to
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Northrop and the Holders the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation of the Commission that may at
any time permit Northrop or a Holder to sell securities of the Company to the
public without registration generally, the Company agrees to use reasonable
commercial efforts to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange
Act; and
(c) furnish to Northrop and any Holder, so long as Northrop or the
Holder owns any Registrable Shares, promptly upon request (i) a written
statement by the Company that it has complied with the reporting
requirements of Rule 144, the Securities Act and the Exchange Act, (ii) a
copy of the most recent
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annual and/or quarterly report of the Company and such other reports and
documents so filed by the Company, and (iii) such other information as may
be reasonably requested in availing Northrop of any rule or regulation of
the Commission which permits the selling of any Registrable Shares without
registration or pursuant to such form.
8. Amendment of Registration Rights. Any provision of this Agreement may
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be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively) only with the
written consent of the Company and Northrop. Any amendment or waiver effected
in accordance with this Section 8 shall be binding upon Northrop and each Holder
of any Registrable Shares then outstanding, each future holder of all such
Registrable Shares and the Company.
9. [Reserved]
10. Restrictions on Public Sale by Holders. Notwithstanding anything
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contained herein, each Holder of Registrable Securities agrees not to effect any
public sale or distribution of any Registrable Securities being registered
except during the period beginning three (3) business days after the release of
each of the Company's quarterly earnings announcements and continuing for thirty
(30) days thereafter.
11. Termination. The rights provided in this Agreement shall terminate on
the first anniversary of the effective date of this Agreement as to the
Registrable Shares issued at the Closing of the APA, and one year following the
date of first exercise of a Warrant as to all Registrable Shares subject to the
Warrant(s).
12. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED, INTERPRETED AND THE
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RIGHTS OF THE PARTIES DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
DELAWARE (WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREOF).
13. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
14. Titles and Subtitles. The titles and subtitles used in this Agreement
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are used for convenience only and are not to be considered in construing or
interpreting this Agreement.
15. Negotiation of Agreement. Each of the parties acknowledges that it
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has been represented by legal counsel of its choice throughout all negotiations
that have preceded the execution of this Agreement and that it has executed the
same with consent and upon the advice of said legal counsel. Each party and its
counsel cooperated in the drafting and preparation of this Agreement and the
documents referred to herein, and any and all drafts relating thereto shall be
deemed the work product of the parties and may not
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be construed against any party by reason of its preparation. Accordingly, any
rule of law or any legal decision that would require interpretation of any
ambiguities in this Agreement against the party that drafted it is of no
application and is hereby expressly waived. The provisions of this Agreement
shall be interpreted in a reasonable manner to effect the intentions of the
parties and this Agreement.
16. Notices. Any notice, request, instruction or other document to be
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given hereunder by any party hereto to another party hereto shall be in writing,
shall be deemed to have been duly given or delivered when delivered personally
or telecopied (receipt confirmed, with a copy sent by reputable overnight
courier), or one business day after delivery to a reputable overnight courier,
postage prepaid, to the address of the party set forth below such person's
signature on this Agreement or to such address as the party to whom notice is to
be given may provide in a written notice to the other party to this Agreement, a
copy of which written notice shall be on file with the Secretary of the Company.
17. Severability. If one or more provisions of this Agreement are held to
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be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its terms
to the fullest extent permitted by law.
18. Further Assurances. Each of the parties shall, without further
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consideration, use reasonable efforts to execute and deliver such additional
documents and take such other action as the other party, may reasonably request
to carry out the intent of this Agreement and the transactions contemplated
hereby.
19. Transfer or Assignment of Registration Rights. The rights to cause
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the Company to register Registrable Securities may not be transferred or
assigned by Northrop.
20. Successors and Assigns. This Agreement shall be binding upon, and all
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rights hereto shall inure to the benefit of, the parties hereto, and their
respective successors and permitted assigns.
21. Entire Agreement. This Agreement embodies the entire agreement and
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understanding of the parties hereto in respect of the actions and transactions
contemplated by this Agreement. There are no restrictions, promises,
inducements, representations, warranties, covenants or undertakings with regard
to the registration of the Company's capital stock pursuant to the Securities
Act, other than those expressly set forth or referred to in this Agreement.
22. Recapitalizations, etc. The provisions of this Agreement (including
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any calculation of share ownership) shall apply, to the full extent set forth
herein with respect to the Registrable Shares, to any and all shares of capital
stock of the Company or any
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capital stock, partnership units or, any other security evidencing ownership
interests in any successor or assign of the Company (whether by merger,
consolidation, sale of assets or otherwise) that may be issued in respect of, in
exchange for, or in substitution of the Common Stock by reason of any stock
dividend, split, combination, recapitalization, liquidation, reclassification,
merger, consolidation or otherwise.
23. Third Party Beneficiary. There are no third party beneficiaries of
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this Agreement.
24. Specific Performance. The parties hereto agree that irreparable
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damage would occur in the event any provision of this Agreement were not
performed in accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition to any other
remedy at law or in equity.
In Witness Whereof, the parties have executed this Agreement on the
date and year above written.
Satcon Technologies Corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
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Its: President
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Northrop Grumman Corporation
By: /s/ Xxxxxx Xxxxx
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Its: Corporate Vice President
and Treasurer
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