Exhibit 4b
REGISTRATION RIGHTS AGREEMENT
Dated as of September 30, 1996
by and among
ELECTRIC FUEL CORPORATION
and
XXXX X. XXXXX
Common Stock of Electric Fuel Corporation
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This Registration Rights Agreement (this "Agreement") is made and
entered into as of September 30, 1996 by and among Electric Fuel Corporation, a
Delaware corporation (the "Company"), and Xxxx X. Xxxxx (the "Purchaser") who
has on the date hereof purchased 1,538,462 shares (the "Shares") of the
Company's common stock, $.01 par value per share (the "Common Stock"), pursuant
to the Stock Purchase Agreement (as defined below).
This Agreement is made pursuant to the Stock Purchase Agreement by and
among the Company and the Purchaser dated September 30, 1996 (the "Stock
Purchase Agreement"). In order to induce the Purchaser to purchase the Shares,
the Company has agreed to provide the registration rights set forth in this
Agreement with respect to the Transfer Restricted Securities (as hereinafter
defined). The execution and delivery of this Agreement is a condition to the
obligations of the Purchaser set forth in Section 6 of the Stock Purchase
Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have
the following meanings:
Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday that
is not a day on which banking institutions in The Borough of Manhattan, The City
of New York, New York are authorized or obligated by law or executive order to
close.
Closing Date: The date on which the Shares are purchased by the Purchaser.
Commission: The Securities and Exchange Commission.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Holder: The Purchaser, or upon his death the executor or personal
representative, or similar legal representative of his estate (the
"Representative"), and then, after the Shares have been distributed to the
Purchaser's beneficiaries from the Representative, the single beneficiary who
receives the largest number of Shares under the Purchaser's last will and
testament.
Market Value: The average closing price of the Common Stock as reported
by The Nasdaq National Market System (as reported by The Wall Street Journal)
over the twenty trading days immediately preceding the date on which the
Purchaser makes a request under Section 3(c) hereof.
NASD: National Association of Securities Dealers, Inc.
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Person: An individual, partnership, corporation, joint venture, trust, estate,
unincorporated organization, or a government or agency or political subdivision
thereof.
Prospectus: The prospectus included in a Shelf Registration Statement
or any other registration statement filed with the Commission by the Company in
connection with Section 2(c)(ii) hereof, as amended or supplemented by any
prospectus supplement and by all other amendments thereto, including
post-effective amendments, and all material incorporated by reference into such
Prospectus.
Securities Act: The Securities Act of 1933, as amended.
Transfer Restricted Securities: All Shares issued to the Purchaser
hereunder until (a) the date on which such shares have been effectively
registered under the Securities Act and disposed of in accordance with this
Agreement, or (b) the date on which such shares are distributed to the public
pursuant to Rule 144 under the Securities Act.
Underwritten Registration or Underwritten Offering: A registration in which
securities of the Company are sold to an underwriter for reoffering to the
public.
SECTION 2. REGISTRATION RIGHTS
(a) Shelf Registration. Upon the request of the Holder, the Company
shall file as promptly as practicable after the receipt of such request, a
registration statement on Form S-3 (the "Shelf Registration Statement")
providing for the sale by the Holder of the Transfer Restricted Securities,
pursuant to Rule 415 of the Commission under the Securities Act, and/or any
similar rule that may be adopted by the Commission. The Company agrees to use
its reasonable efforts to cause the Shelf Registration Statement to be declared
effective as promptly as practicable and to keep such Shelf Registration
Statement continuously effective (and the Prospectus contained therein current)
for a period of 270 days. So long as any such Shelf Registration Statement is
effective, any Holder desiring to sell Transfer Restricted Securities thereunder
shall give notice to the Company by facsimile transmission in accordance with
Section 6(b) hereof on the date of the initiation of the sale of such Transfer
Restricted Securities.
The Holder shall be entitled to make only two demands for a Shelf
Registration Statement hereunder. Upon the earlier of 270 days after the date on
which the second Shelf Registration Statement is first declared effective under
the Securities Act by the Commission and the date as of which the Holder no
longer continues to hold a greater number of shares of Common Stock than could
be sold in a three-month period within the limitations of Rule 144(e) under the
Securities Act, the obligations of the Company under this Agreement shall
terminate.
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In the event the Company, in good faith, prepares and files with the
Commission a Shelf Registration Statement pursuant to the exercise of the
registration rights granted hereunder, and the Shelf Registration Statement is
not able to be declared effective, the Holder shall have the right to require
the Company to file one additional Shelf Registration Statement pursuant to this
Section 2, which third Shelf Registration Statement shall be at the Holder's
expense; provided that if the Shelf Registration Statement is not able to be
declared effective solely because the Company has not complied with its
obligations under this Agreement, such Shelf Registration Statement shall not be
counted for purposes of this Agreement.
The Company shall not be obligated to honor any such request for
registration under this Section 2 at any time (i) if, in the good faith judgment
of the Company's Board of Directors, such registration statement, Prospectus or
any document incorporated therein would not be in compliance with the Securities
Act and the regulations promulgated thereunder, (ii) starting with the date 30
days prior to the Company's good faith estimate of the date of filing of, and
ending on the date 180 days following the effective date of, a registration
statement in connection with a bona fide public offering of the Company's Common
Stock (or securities convertible into Common Stock) or (iii) if, in the good
faith judgment of the Company's Board of Directors, there is a material
development relating to the condition (financial or other) of the Company that
has not been disclosed to the general public. If the Company utilizes its rights
under clause (i) of this paragraph, it shall use reasonable efforts to cooperate
with the Holder, subject to clause (iii) of this paragraph, to be able to file
such registration statement as promptly as possible.
(b) Restrictions on Public Sale by Holder. Upon the written request of
the underwriter(s) in any Underwritten Offering of the Company, the Holder shall
not effect any sale or distribution of securities of the Company of the same
class as the securities or any security convertible into or exchangeable or
exercisable for such security, included in such Underwritten Offering, including
a sale pursuant to Rule 144 under the Securities Act (except as part of such
registration) during the 180-day period (or such shorter time period as the
underwriter(s) may request) beginning on the effective date of the registration
statement filed with respect to any such Underwritten Offering.
(c) Underwritten Offering.
(i) Upon request by the Holder, the Company agrees it will use all
reasonable efforts, subject to the conditions set forth in
Section 2(a) hereof, to amend or supplement the Shelf
Registration Statement such that it may be used in an
Underwritten Offering; provided that, the Transfer Restricted
Securities to be
-------- ----
sold by the Holder in such Underwritten Offering have a Market
Value equal to at least $10 million and that the Holder bear
all incremental expenses (subject to the provisions of the
second sentence of this Section 2(c)(i)), related to such
amendment or supplement. If the Company determines to
Register any securities in an Underwritten Offering requested
by the Holder pursuant to this
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Section 2(c), the Company shall bear such portion of the total
expenses relating to such Underwritten Offering as the
securities registered in the Underwritten Offering by the
Company bear to the total securities registered in such
Underwritten Offering. The Holder may not participate in any
Underwritten Offering hereunder unless the Holder (i) agrees
to sell his Transfer Restricted Securities on the basis
provided in any underwriting arrangements approved by the
Persons entitled hereunder to approve such arrangements and
(ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other
documents required under the terms of such underwriting
arrangements. In any such Underwritten Offering, the
investment banker or investment bankers and manager or
managers that will administer the offering will be selected by
the Company.
(ii) So long as any of the Shares constitute Transfer Restricted
Securities, if (but without any obligation to do so) the
Company proposes to register, including for this purpose a
registration effected by the Company for stockholders of the
Company other than the Holder, any of the Common Stock under
the Securities Act in connection with the public offering of
Common Stock solely for cash other than a registration on Form
S-8 or any successor form relating solely to the sale of
securities to participants in the Company stock plan, or a
registration on Form S-4 or any successor form relating to an
acquisition by the Company)(an "Incidental Registration"), the
Company shall, at such time, promptly give the Holder written
notice of such Incidental Registration. Upon the written
request of the Holder given within 20 days after mailing of
such notice by the Company, the Company shall use its
reasonable efforts to cause a registration statement covering
all of the Transfer Restricted Securities that the Holder has
requested to be registered to become effective under the
Securities Act; provided, however, that nothing herein,
including without limitation the provisions of Section 3 of
this Agreement, shall prevent the Company from, at any time,
abandoning or delaying any Incidental Registration.
In the case of an Underwritten Offering pursuant to this
Section 2(c)(ii), if the managing underwriter advises the
Company that marketing factors require a limitation of the
number of shares of Common Stock to be underwritten, then the
Company shall include in such registration (A) first, the
shares of the Common Stock, being registered on behalf of the
Company or on behalf of the stockholders (other than the
Holder) requesting such registration, as the case may be, and
(B) second, the Common Stock being registered on behalf of the
Holder apportioned on a pro rata basis among the Holder and
any other Persons entitled to include securities in such
registration in accordance with the number of shares of Common
Stock requested by the Holder and such other Persons to be
included in such registration.
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SECTION 3. REGISTRATION PROCEDURES
The Company will use its reasonable best efforts to effect the
registration to permit the sale of the Transfer Restricted Securities being sold
in accordance with this Agreement and the intended method or methods of
distribution thereof, and pursuant thereto the Company will:
(a) prepare and file with the Commission a Shelf Registration Statement
relating to the registration on Form S-3 under the Securities Act, cooperate and
assist in any filings required to be made with the NASD and use its best efforts
to cause such Shelf Registration Statement to become effective;
(b) prepare and file with the Commission such amendments and
post-effective amendments to the Shelf Registration Statement and such filings
under the Exchange Act as may be necessary to keep the Shelf Registration
Statement effective for such period as may be reasonably necessary to effect the
sale of such Transfer Restricted Securities, not to exceed 270 days and, comply
with the provisions of the Securities Act and the rules and regulations
thereunder, and comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such Shelf Registration Statement
during the applicable period in accordance with the intended method or methods
of distribution by the Holder set forth in such Shelf Registration Statement;
(c) advise the underwriter(s), with respect to an offering pursuant to
Section 2(c), and the Holder promptly:
(i) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to the Shelf
Registration Statement or a registration statement filed in accordance
with Section 2(c)(ii) or any post-effective amendment thereto, when the
same has become effective;
(ii) of any request by the Commission for amendments to the
Shelf Registration Statement or a registration statement filed in
accordance with Section 2(c)(ii) or amendments or supplements to the
Prospectus or for additional information relating thereto;
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Shelf Registration Statement under
the Securities Act or of the suspension by any state securities
commission of the qualification of the Transfer Restricted Securities
for offering or sale in any jurisdiction, or the initiation of any
proceeding for any of the preceding purposes. If at any time the
Company shall receive any such stop order suspending the effectiveness
of the Shelf Registration Statement or a registration statement filed
in accordance with Section 2(c)(ii), or any such order from a state
securities commission or other regulatory authority, the
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Company shall use its best efforts to obtain the withdrawal or lifting
of such order at the earliest possible time;
(iv) if at any time the representations and warranties of the
Company contemplated by paragraph (j)(i) below cease to be true and
correct;
(v) of the existence of any fact and the happening of any
event that makes any statement of a material fact made in the Shelf
Registration Statement, or a registration statement filed in accordance
with Section 2(c)(ii), the Prospectus, any amendment or supplement
thereto, or any document incorporated by reference therein untrue, or
that requires the making of any additions to or changes in the Shelf
Registration Statement or a registration statement filed in accordance
with Section 2(c)(ii) or the Prospectus in order to make the statements
therein not misleading.
(d) in connection with the filing of any document that is to be
incorporated by reference into the Shelf Registration Statement or any
registration statement filed in accordance with Section 2(c)(ii) or the
Prospectus (after initial filing of the Shelf Registration Statement or any
registration statement filed in accordance with Section 2(c)(ii)):
(i) use its best efforts to provide copies of such document to
the Holder and to the managing underwriter(s), if any, prior to such
filing and in any event no later than concurrently with such filing;
and
(ii) make the Company's representative available for
discussion of such document;
(e) furnish to the Holder and each of the underwriter(s), with respect
to an offering pursuant to Section 2(c), at least one signed copy of the Shelf
Registration Statement, or a registration statement filed in accordance with
Section 2(c)(ii), as first filed with the Commission, and of each amendment
thereto, including all documents incorporated by reference therein and all
exhibits;
(f) deliver to the Holder and each of the underwriter(s), with respect
to an offering pursuant to Section 2(c), as many copies of the Prospectus
(including each preliminary prospectus) and any amendment or supplement thereto
as such Persons may reasonably request; the Company consents to the use of the
Prospectus and any amendment or supplement thereto by the Holder and each of the
underwriter(s), if any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;
(g) prior to any public offering of Transfer Restricted Securities,
cooperate with the Holder, the underwriter(s) with respect to an offering
pursuant to Section 2(c), and their respective counsel in connection with the
registration and qualification of the Transfer
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Restricted Securities under the securities or blue sky laws of such
jurisdictions as the Holder or underwriter(s) may request and do any and all
other acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the Shelf
Registration Statement, or a registration statement filed in accordance with
Section 2(c)(ii); provided, however, that the Company shall not be required to
register or qualify as a foreign corporation where it is not then so qualified
or to take any action that would subject it to the service of process in suits
or to taxation, other than as to matters and transactions relating to the Shelf
Registration Statement, or a registration statement filed in accordance with
Section 2(c)(ii), in any jurisdiction where it is not then so subject;
(h) cooperate with the Holder and the underwriter(s) with respect to an
offering pursuant to Section 2(c), to facilitate the timely preparation and
delivery of certificates representing Transfer Restricted Securities to be sold
and not bearing any restrictive legends; and enable such Transfer Restricted
Securities to be in such denominations and registered in the name as the Holder
or the underwriter(s), if any, may request at least two Business Days prior to
any sale of Transfer Restricted Securities made by such underwriter(s);
(i) if any fact or event contemplated by clause (c)(v) above shall
exist or have occurred, prepare a supplement or post-effective amendment to the
Shelf Registration Statement, or a registration statement filed in connection
with Section 2(c)(ii) or related Prospectus or any document incorporated therein
by reference or file any other required document so that, as thereafter
delivered to the purchasers of Transfer Restricted Securities, the Prospectus
will not contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading;
(j) with respect to an offering pursuant to Section 2(c), enter into
such agreements (including an underwriting agreement) and take all such other
actions in connection therewith as may be required in order to expedite or
facilitate the disposition by the Holder, of the Transfer Restricted Securities
pursuant to this Agreement, and in connection with any such underwriting
agreement entered into by the Company:
(i) make such representations and warranties to the
underwriter(s) and the Holder, in form, substance and scope as are
customarily made by issuers to underwriters in primary underwritten
offerings;
(ii) obtain opinions of counsel to the Company and updates
thereof addressed to the Holder and the underwriter(s) covering the
matters customarily covered in opinions requested in underwritten
offerings and such other matters as may be requested by, the Holder and
underwriters;
(iii) obtain "cold comfort" or "agreed upon procedures"
letters and updates thereof from the Company's independent certified
public accountants, addressed to the
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Holder and the underwriters, such letters to be in customary form and
covering matters of the type customarily covered in such letters by
underwriters in connection with primary underwritten offerings;
(iv) set forth in full or incorporate by reference in the
underwriting agreement the indemnification provisions and procedures of
Section 5 hereof with respect to all parties to be indemnified pursuant
to said Section; and
(v) deliver such documents and certificates as may be
requested by the Holder of the Transfer Restricted Securities being
sold or the underwriter(s) of such Underwritten Offering to evidence
compliance with clause (i) above and with any customary conditions
contained in the underwriting agreement or other agreement entered into
by the Company pursuant to this clause (j).
The above shall be done at each closing under such underwriting or
similar agreement, as and to the extent required thereunder;
(k) make available for inspection by a representative of the Holder and
the underwriter(s) with respect to an offering pursuant to Section 2(c), and any
attorney or accountant retained by any of them, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors and employees to supply all information reasonably
requested by any of them in connection with such Shelf Registration Statement
subsequent to the filing thereof and prior to its effectiveness; and
(l) use its best efforts to cause all Transfer Restricted Securities to
be listed on each securities exchange, if any, on which equity securities issued
by the Company are then listed.
The Holder agrees to furnish promptly to the Company all information
required to be disclosed by the Holder in order to make the information
previously furnished to the Company by such Holder not materially misleading.
The Holder agrees that upon receipt of any notice from the Company that
any fact or event exists as a result of which the Shelf Registration Statement,
the prospectus included therein, or any document incorporated therein by
reference contains or may contain any untrue statement of material fact or omits
or may 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, the Holder will forthwith discontinue any
disposition of any Transfer Restricted Securities pursuant to the Shelf
Registration Statement until (i) the Holder has received copies of the
supplemented or amended prospectus contemplated by Section 4(b) hereof, or (ii)
the Holder has received written advice from the Company that the use of the
Prospectus contained in the Shelf Registration Statement may be resumed, and has
received copies of any additional or supplemental filings which are incorporated
by reference in such
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prospectus, and, if so directed by the Company, the Holder will deliver to the
Company all copies, other than permanent file copies then in the Holder's
possession, of the prospectus covering the Transfer Restricted Securities
current at the time of receipt of such notice. The period from and including the
date of the giving of such notice to and including the date when each Holder
shall have either received copies of the supplemented or amended prospectus or
received advice from the Company that the use of the prospectus contained in the
Shelf Registration Statement may be resumed is referred to herein as the
"Holdback Period." The Company agrees to use all reasonable efforts to minimize
the duration and frequency of any Holdback Periods hereunder to the extent
consistent with the Company's financial, strategic, and other business
priorities.
SECTION 4. REGISTRATION EXPENSES
(a) Except as otherwise provided by Sections 2(a) or (c), all expenses
incident to the Company's performance of or compliance with this Agreement
(other than underwriting discounts or commissions) will be borne by the Company,
including without limitation:
(i) all registration and filing fees and expenses (including
filings made with the
NASD or any securities exchange);
(ii) fees and expenses of compliance with federal securities
and state blue sky or securities laws;
(iii) expenses of printing;
(iv) fees and disbursements of counsel for the Company;
(v) all application and filing fees in connection with listing
the Common Stock on a national securities exchange or automated
quotation system pursuant to the requirements hereof; and
(vi) all fees and disbursements of independent certified
public accountants of the Company (including the expenses of any
special audit and "cold comfort" or "agreed upon procedures" letters
required by or incident to such performance).
The Company will also bear its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting, duties), the expense of any annual audit, and the fees and
expenses of any Person, including special experts, retained by the Company.
SECTION 5. INDEMNIFICATION
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(a) The Company agrees to indemnify and hold harmless the Holder and
each Person, if any, who controls such Holder within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act from and against any and
all losses, claims, damages, liabilities and expenses (including, without
limiting the foregoing but subject to Section 5(c) hereof, the reasonable legal
and other expenses incurred in connection with any action, suit or proceeding or
any claim asserted) arising out of or based upon any untrue statement or alleged
untrue statement of a material fact contained in any Shelf Registration
Statement or the Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) or any preliminary
Prospectus, 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, in the light of the circumstances under which they were
made in the case of the Prospectus, not misleading, except insofar as such
losses, claims, damages, liabilities, or expenses arise out of or are based upon
any such untrue statement or omission or alleged untrue statement or omission
based upon information (i) relating to the Holder, furnished in writing to the
Company by or on behalf of the Holder expressly for use therein or (ii) made in
any preliminary Prospectus if a copy of the Prospectus (as amended or
supplemented) was not sent or given by or on behalf of the Holder to the person
asserting any such loss, claim, damage or liability or obtaining such judgment
at or prior to the written confirmation of the sale of the Transfer Restricted
Securities as required by the Securities Act, and the Prospectus (as so amended
or supplemented) would have corrected such untrue statement or omission;
provided, however, that the Company shall have furnished copies of such
Prospectus (as so amended or supplemented) to the Holder in compliance with
Section 3(f) hereof.
(b) As a condition to the inclusion of its Transfer Restricted
Securities in any Shelf Registration Statement pursuant to this Agreement, the
Holder thereof will furnish to the Company in writing, promptly after receipt of
a request therefor, such information as the Company may reasonably request for
use in connection with any Shelf Registration Statement, Prospectus or
preliminary prospectus and agrees to indemnify and hold harmless, the Company
and its directors, its officers who sign such Shelf Registration Statement, and
any Person controlling the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
indemnity from the Company to the Holder and Persons controlling such Holder,
but only with reference to information relating to the Holder furnished in
writing by or on behalf of such Holder expressly for use in such Shelf
Registration Statement or the Prospectus or any preliminary Prospectus included
therein. In case any action shall be brought against the Company, any of its
directors, any such officer, or any such controlling Person based on the Shelf
Registration Statement, the Prospectus or any preliminary prospectus and in
respect of which indemnity may be sought against the Holder, the Holder shall
have the rights and duties given to the Company (except that if the Company as
provided in Section 5(c) hereof shall have assumed the defense thereof the
Holder shall not be required to do so, but may employ separate counsel therein
and participate in the defense thereof but the fees and expenses of such counsel
shall be at such Holder's expense) and the Company and its directors, any such
officers, and any such controlling Person shall have the
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rights and duties given by Section 5(c) hereof. In no event shall the liability
of the Holder hereunder be greater than the gross proceeds received by the
Holder upon the sale of the Transfer Restricted Securities giving rise to such
indemnification obligation.
(c) In case any action or proceeding shall be brought against the
Holder or any Person controlling the Holder, based upon the Shelf Registration
Statement, the Prospectus or any preliminary prospectus, or any amendment or
supplement thereto, and with respect to which indemnity may be sought against
the Company, the Holder or such Person controlling such Holder shall promptly
notify the Company in writing and the Company shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to the Holder and
payment of all reasonable fees and expenses relating thereto. The Holder and
such Persons controlling such Holder shall have the right to employ separate
counsel in any such action or proceeding and participate in the defense thereof,
but the fees and expenses of such counsel shall be at such Holder's expense
unless (i) the employment of such counsel has been specifically authorized in
writing by the Company, (ii) the Company has not assumed the defense and
employed counsel reasonably satisfactory to the Holder within 15 days after
notice of any such action or proceeding, or (iii) the named parties to any such
action or proceeding (including any impleaded parties) include both the Holder
or any Person controlling such Holder and the Company and the Holder or any
Person controlling such Holder shall have been advised by such counsel that
there may be one or more legal defenses available to the Holder or Person
controlling such Holder that are different from or additional to those available
to the Company (in which case the Company shall not have the right to assume the
defense of such action or proceeding on behalf of such Holder or controlling
Person, it being understood, however, that the Company shall not, in connection
with any one such action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys for the Holder and controlling Persons, which firm
shall be designated in writing by the Holder of a majority of the Transfer
Restricted Securities). The Company shall not be liable for any settlement of
any such action effected without the written consent of the Company, but if
settled with the written consent of the Company, which consent shall not be
unreasonably withheld, or if there is a final judgment for the plaintiff, the
Company agrees to indemnify and hold harmless the Holder and all Persons
controlling, the Holder from and against any loss or liability by reason of such
settlement or judgment.
(d) If the indemnification provided for in this Section 5 is
unavailable to an indemnified party under paragraphs (a) or (b) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then each 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 and expenses in such
proportion as is appropriate to reflect the relative benefit to the Company on
the one hand and the Holder on the other hand in connection with the sale of the
Transfer Restricted Securities, as well as any other relevant equitable
considerations; provided, however, that the Holder
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shall not be required to contribute an amount greater than the gross proceeds
received by the Holder with respect to the sale of Transfer Restricted
Securities giving rise to the indemnification obligation under this Section 5.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities or expenses 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.
(e) The Company and the Holder agree that it would not be just and
equitable if contribution pursuant to this Section 5 were determined by a pro
rata allocation or by any other method of allocation that does not take account
of the equitable considerations referred to in paragraph (d) above. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages, liabilities and expenses referred to in paragraph (d) above 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 any claim or defending any such action, suit or proceeding. No
person guilty of fraudulent misrepresentation (within the meaning of Section 11
of the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
SECTION 6. MISCELLANEOUS
(a) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to or departures from
the provisions hereof may not be given unless the Company has obtained the
written consent of the Holder.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
(i) if to the Holder, to: Xxxx X. Xxxxx
c/o Enterprises, Inc.
River Park House
0000 Xxxxxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000;
with a copy to: Xxxxxxxx X. Xxxxxx, Esq.
Xxxxxxxx, Xxxxx & Xxxxxx
0000 Xxxxxxxxxxx Xxxxxx,X.X.
Xxxxxxxxxx, X.X.00000-0000;
(ii) if to the Company, to: Electric Fuel Corporation
000 Xxxxx Xxxxxx, Xxxxx 0000
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Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx
with a copy to: Xxxxxxxx X. Xxxxx, Esq.
Ropes and Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if telecopied; and on the
next business day, if timely delivered to an air courier guaranteeing overnight
delivery.
(c) Successors and Assigns. The registration rights granted to the
Holder pursuant to this Agreement shall not be for the benefit of, or
enforceable by, any subsequent holder of the Common Stock unless such subsequent
holder is a Holder. This Agreement shall inure to the benefit of and be binding
upon the successors and assigns of the Company.
(d) 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 an original and all of which taken
together shall constitute one and the same agreement.
(e) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(f) Governing Law. This agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to any
conflicts or choice of law principles which would cause the application of the
internal laws of any jurisdiction other than the State of Delaware.
(g) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(h) Entire Agreement. This Agreement, together with the other Operative
Documents (as defined in the Stock Purchase Agreement), is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. 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
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Transfer Restricted Securities. This Agreement supersedes all prior agreements
and understandings between the parties with respect to such subject matter.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
ELECTRIC FUEL CORPORATION
By:___________________________________
Name:
Title:
XXXX X. XXXXX
By:______________________________
Page 32 of 40
