Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made as of the 7th
day of October, 2003 between ULTRALIFE BATTERIES, INC., a Delaware corporation
(the "Company") and _________________________, a ______________________________
(the "Purchaser").
The Company and the Purchaser have entered into that certain Stock
Purchase Agreement (the "Stock Purchase Agreement") pursuant to which the
Purchaser purchased _______ newly-issued shares of the Company's Common Stock or
shares issued from the Company's treasury (the "Shares") at a purchase price of
$12.50 per share and also pursuant to which the Company agreed to register the
Shares for the benefit of the Purchaser.
Capitalized terms not defined in this Agreement shall have the meanings
given them in the Stock Purchase Agreement.
In consideration of the covenants and conditions set forth in this
Agreement, the parties agree as follows:
A. REGISTRATION; COMPLIANCE WITH THE SECURITIES ACT; COVENANTS
a.1 Registration of Shares
a.1.1 Registration Statement; Expenses
The Company shall:
(a) use its best efforts to prepare and file with the Securities and
Exchange Commission (the "Commission") within thirty (30) days of the date of
Closing a Registration Statement on Form S-3 (or, if the Company is ineligible
to use Form S-3, then on Form S-1) relating to the sale of the Shares by the
Purchaser from time to time on the Nasdaq National Market (or the facilities of
any national securities exchange on which the Company's Common Stock is then
traded) or in privately negotiated transactions (the "Registration Statement");
(b) provide to the Purchaser any information required to permit the sale
of the Shares under Rule 144A of the Securities Act;
(c) subject to receipt of necessary information from the Purchaser, use
its reasonable best efforts to cause the Commission to declare the Registration
Statement effective as soon as practicable after the Registration Statement is
filed with the Commission;
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(d) notify Purchaser promptly upon the Registration Statement, and any
post-effective amendment thereto, being declared effective by the Commission;
(e) prepare and file with the Commission such amendments and supplements
to the Registration Statement and the Prospectus (as defined in Section 1.3.1
below) and take such other action, if any, as may be necessary to keep the
Registration Statement effective until the earlier of (i) the date on which the
Shares may be resold by the Purchaser without registration and without regard to
any volume limitations by reason of Rule 144(k) under the Securities Act or any
other rule of similar effect or (ii) all of the Shares have been sold pursuant
to the Registration Statement or Rule 144 under the Securities Act or any other
rule of similar effect;
(f) promptly furnish to the Purchaser with respect to the Shares
registered under the Registration Statement such reasonable number of copies of
the Prospectus, including any supplements to or amendments of the Prospectus, in
order to facilitate the public sale or other disposition of all or any of the
Shares by the Purchaser;
(g) during the period when copies of the Prospectus are required to be
delivered under the Securities Act or the Exchange Act, will file all documents
required to be filed with the Commission pursuant to Section 13, 14 or 15 of the
Exchange Act within the time periods required by the Exchange Act and the rules
and regulations promulgated thereunder;
(h) file documents required of the Company for customary Blue Sky
clearance in all states requiring Blue Sky clearance; provided, however, that
the Company shall not be required to qualify to do business or consent to
service of process in any jurisdiction in which it is not now so qualified or
has not so consented;
(i) advise the Purchaser, promptly after it shall receive notice or obtain
knowledge of the issuance of any stop order by the Commission delaying or
suspending the effectiveness of the Registration Statement or of the initiation
of any proceeding for that purpose; and it will promptly use its best efforts to
prevent the issuance of any stop order or to obtain its withdrawal at the
earliest practicable moment if such stop order should be issued; and
(j) bear all expenses in connection with the procedures in paragraphs (a)
through (i) of this Section 1.1.1 and the registration of the Shares pursuant to
the Registration Statement.
a.2 Transfer of Shares After Registration
Purchaser agrees that the Purchaser will not effect any disposition of the
Shares or right to purchase the Shares that would constitute a sale within the
meaning of the Securities Act, except as contemplated in the Registration
Statement referred to in Section 1.1 or as otherwise permitted by law, and that
the Purchaser will promptly notify the Company of any changes in the information
set forth in the Registration Statement regarding the Purchaser or the
Purchaser's plan of distribution.
a.3 Indemnification
For the purpose of this Section 1.3, the term "Registration Statement" shall
include any preliminary or final prospectus, exhibit, supplement or amendment
included in or relating to the Registration Statement referred to in Section
1.1.
a.3.1 Indemnification by the Company
The Company agrees to indemnify and hold harmless the Purchaser and each person,
if any, who controls the Purchaser within the meaning of the Securities Act,
against any losses, claims, damages, liabilities or expenses, joint or several,
to which the Purchaser or such controlling person may become subject, under the
Securities Act, the Exchange Act, or any other federal or state statutory law or
regulation, or at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of the
Company, which consent shall not be unreasonably withheld), insofar as such
losses, claims, damages, liabilities or expenses (or actions in respect thereof
as contemplated below) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement, including the Prospectus, financial statements and schedules, and all
other documents filed as a part thereof, as amended at the time of effectiveness
of the
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Registration Statement, including any information deemed to be a part thereof as
of the time of effectiveness pursuant to paragraph (b) of Rule 430A, or pursuant
to Rule 434, of the Rules and Regulations, or the Prospectus, in the form first
filed with the Commission pursuant to Rule 424(b) of the Regulations, or filed
as part of the Registration Statement at the time of effectiveness if no Rule
424(b) filing is required (the "Prospectus"), or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state in any of them a material fact required to be stated therein or necessary
to make the statements in any of them, in light of the circumstances under which
they were made, not misleading, or arise out of or are based in whole or in part
on any inaccuracy in the representations and warranties of the Company contained
in this Agreement, or any failure of the Company to perform its obligations
under this Agreement or under applicable law, and will reimburse the Purchaser
and each such controlling person for any legal and other expenses as such
expenses are reasonably incurred by the Purchaser or such controlling person in
connection with investigating, defending, settling, compromising or paying any
such loss, claim, damage, liability, expense or action; provided, however, that
the Company will not be liable in any such case to the extent that any such
loss, claim, damage, liability or expense arises out of or is based upon (i) an
untrue statement or alleged untrue statement or omission or alleged omission
made in the Registration Statement, the Prospectus or any amendment or
supplement of the Registration Statement or Prospectus in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
the Purchaser expressly for use in the Registration Statement or the Prospectus,
or (ii) the failure of the Purchaser to comply with the covenants and agreements
contained in the Stock Purchase Agreement or in Section 1.2 of this Agreement
respecting resale of the Shares, or (iii) the inaccuracy of any representations
made by the Purchaser in this Agreement or (iv) any untrue statement or omission
of a material fact required to make such statement not misleading in any
Prospectus that is corrected in any subsequent Prospectus that was delivered to
the Purchaser before the pertinent sale or sales by the Purchaser.
a.3.2 Indemnification by the Purchaser
The Purchaser will indemnify and hold harmless the Company, each of its
directors, each of its officers who signed the Registration Statement and each
person, if any, who controls the Company within the meaning of the Securities
Act, against any losses, claims, damages, liabilities or expenses to which the
Company, each of its directors, each of its officers who signed the Registration
Statement or controlling person may become subject, under the Securities Act,
the Exchange Act, or any other federal or state statutory law or regulation, or
at common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Purchaser, which consent
shall not be unreasonably withheld) insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof as contemplated below)
arise out of or are based upon (i) any failure on the part of the Purchaser to
comply with the covenants and agreements contained in the Stock Purchase
Agreement or Section 1.2 of this Agreement respecting the sale of the Shares or
(ii) the inaccuracy of any representation made by the Purchaser in this
Agreement or (iii) any untrue or alleged untrue statement of any material fact
contained in the Registration Statement, the Prospectus, or any amendment or
supplement to the Registration Statement or Prospectus, 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, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in the Registration Statement, the Prospectus, or any amendment or supplement
thereto, in reliance upon and in conformity with written information furnished
to the Company by or on behalf of the Purchaser expressly for use therein;
provided, however, that the Purchaser shall not be liable for any such untrue or
alleged untrue statement or omission or alleged omission of which the Purchaser
has delivered to the Company in writing a correction before the occurrence of
the transaction from which such loss was incurred, and the Purchaser will
reimburse the Company, each of its directors, each of its officers who signed
the Registration Statement or controlling person for any legal and other expense
reasonably incurred by the Company, each of its directors, each of its officers
who signed the Registration Statement or controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action.
a.3.3 Indemnification Procedure
(a) Promptly after receipt by an indemnified party under this Section 1.3
of notice of the threat or commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 1.3, promptly notify the indemnifying party in writing of the
claim; but the omission so to notify the indemnifying party will not relieve it
from any liability which it may have to any
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indemnified party for contribution or otherwise under the indemnity agreement
contained in this Section 1.3 or to the extent it is not prejudiced as a result
of such failure.
(b) In case any such action is brought against any indemnified party and
such indemnified party seeks or intends to seek indemnity from an indemnifying
party, the indemnifying party will be entitled to participate in, and, to the
extent that it may wish, jointly with all other indemnifying parties similarly
notified, to assume the defense thereof with counsel reasonably satisfactory to
such indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be a conflict
between the positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be legal defenses
available to it or other indemnified parties that are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 7.3 for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless:
(i) the indemnified party shall have employed such counsel in
connection with the assumption of legal defenses in accordance with the proviso
to the preceding sentence (it being understood, however, that the indemnifying
party shall not be liable for the expenses of more than one separate counsel,
approved by such indemnifying party representing all of the indemnified parties
who are parties to such action) or
(ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of action, in each
of which cases the reasonable fees and expenses of counsel shall be at the
expense of the indemnifying party. Notwithstanding the provisions of this
Section 1.3, the Purchaser shall not be liable for any indemnification
obligation under this Agreement in excess of the amount of net proceeds received
by the Purchaser from the sale of the Shares.
a.3.4 Contribution
If the indemnification provided for in this Section 1.3 is required by its terms
but is for any reason held to be unavailable to or otherwise insufficient to
hold harmless an indemnified party under this Section 1.3 in respect to any
losses, claims, damages, liabilities or expenses referred to in this Agreement,
then each applicable indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of any losses, claims, damages,
liabilities or expenses referred to in this Agreement
(a) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Purchaser from the placement of Common Stock or
(b) if the allocation provided by clause (a) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (a) above but the relative fault of the
Company and the Purchaser in connection with the statements or omissions or
inaccuracies in the representations and warranties in this Agreement that
resulted in such losses, claims, damages, liabilities or expenses, as well as
any other relevant equitable considerations.
The respective relative benefits received by the Company on the one hand and the
Purchaser on the other shall be deemed to be in the same proportion as the
amount paid by the Purchaser to the Company pursuant to this Agreement for the
Shares purchased by the Purchaser that were sold pursuant to the Registration
Statement bears to the difference (the "Difference") between the amount the
Purchaser paid for the Shares that were sold pursuant to the Registration
Statement and the amount received by the Purchaser from such sale. The relative
fault of the Company and the Purchaser shall be determined by reference to,
among other things, whether the untrue or alleged statement of a material fact
or the omission or alleged omission to state a material fact or the inaccurate
or the alleged inaccurate representation or warranty relates to information
supplied by the Company or by the Purchaser
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and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid or
payable by a party as a result of the losses, claims, damages, liabilities and
expenses referred to above shall be deemed to include, subject to the
limitations set forth in Section 1.3.3, any legal or other fees or expenses
reasonably incurred by such party in connection with investigating or defending
any action or claim. The provisions set forth in Section 1.3.3 with respect to
the notice of the threat or commencement of any threat or action shall apply if
a claim for contribution is to be made under this Section 1.3.4; provided,
however, that no additional notice shall be required with respect to any threat
or action for which notice has been given under Section 1.3 for purposes of
indemnification. The Company and each Purchaser agree that it would not be just
and equitable if contribution pursuant to this Section 1.3 were determined
solely by pro rata allocation (even if the Purchaser were treated as one entity
for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in this paragraph.
Notwithstanding the provisions of this Section 1.3, the Purchaser shall not be
required to contribute any amount in excess of the amount by which the
Difference exceeds the amount of any damages that the Purchaser has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
a.4 Termination of Conditions and Obligations
The restrictions imposed by the Stock Purchase Agreement or this Agreement upon
the transferability of the Shares shall cease and terminate as to any particular
number of the Shares upon the passage of two years from the Closing Date or at
such time as an opinion of counsel satisfactory in form and substance to the
Company shall have been rendered to the effect that such conditions are not
necessary in order to comply with the Securities Act.
a.5 Information Available
From the date of this Agreement through the date the Registration Statement
covering the resale of Shares owned by the Purchaser is no longer effective, the
Company will furnish to the Purchaser:
(a) as soon as practicable after available (but in the case of the
Company's Annual Report to Shareholders, within 90 days after the end of each
fiscal year of the Company), one copy of
(i) its Annual Report to Stockholders (which Annual Report shall
contain financial statements audited in accordance with generally accepted
accounting principles by a national firm of certified public accountants);
(ii) if not included in substance in the Annual Report to
Stockholders, its Annual Report on Form 10-K;
(iii) if not included in substance in its Quarterly Reports to
Stockholders, its quarterly reports on Form 10-Q; and
(iv) a full copy of the particular Registration Statement covering
the Shares (the foregoing, in each case, excluding exhibits);
(b) upon the request of the Purchaser, a reasonable number of copies of
the Prospectus to supply to any other party requiring the Prospectus.
a.6 Rule 144 Information
Until the earlier of (i) the date on which the Shares may be resold by the
Purchaser without registration and without regard to any volume limitations by
reason of Rule 144(k) under the Securities Act or any other rule of similar
effect or (ii) all of the Shares have been sold pursuant to the Registration
Statement or Rule 144 under the Securities Act or any other rule of similar
effect, the Company shall file all reports required to be filed by it under the
Securities Act, the Rules and Regulations and the Exchange Act and shall take
such further action to the extent required to enable the Purchasers to sell the
Shares pursuant to Rule 144 under the Securities Act (as such rule may be
amended from time to time).
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B. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER
b.1 Securities Law Representations and Warranties
The Purchaser represents, warrants and covenants to the Company as
follows:
(a) The Purchaser has acquired the Shares for the Purchaser's own account
for investment only, and has no present intention of distributing any of the
Shares, nor any arrangement or understanding with any other persons regarding
the distribution of the Shares within the meaning of Section 2(11) of the
Securities Act, other than as contemplated in Section 1 of this Agreement.
(b) The Purchaser will not, directly or indirectly, offer, sell, pledge,
transfer or otherwise dispose of (or solicit any offers to buy, purchase or
otherwise acquire or take a pledge of) any of the Shares except in compliance
with the Securities Act and rules and regulations promulgated thereunder the
"Rules and Regulations").
(c) The Purchaser has completed or caused to be completed the Registration
Statement Questionnaire, attached to this Agreement as Appendix I, for use in
preparation of the Registration Statement, and the answers to the Questionnaire
are true and correct as of the date of this Agreement and will be true and
correct as of the effective date of the Registration Statement; provided,
however, that the Purchaser shall be entitled to update such information by
providing notice thereof to the Company before the effective date of the
Registration Statement.
b.2 Resales of Shares
(a) The Purchaser hereby covenants with the Company not to make any sale
of the Shares without satisfying the requirements of the Securities Act and the
Rules and Regulations, including, in the event of any resale under the
Registration Statement, the prospectus delivery requirements under the
Securities Act, and the Purchaser acknowledges and agrees that such Shares are
not transferable on the books of the Company pursuant to a resale under the
Registration statement unless the certificate submitted to the transfer agent
evidencing the Shares is accompanied by a separate certificate
(i) in the form of Appendix II to this Agreement;
(ii) executed by the Purchaser individually, or if the Purchaser is
an entity, by an officer of, or other authorized person designated by, the
Purchaser; and
(iii) to the effect that (a) the Shares have been sold in accordance
with the Registration Statement and (b) the requirement of delivering a current
prospectus has been satisfied.
(b) The Purchaser acknowledges that there may occasionally be times when
the Company determines, in good faith following consultation with its Board of
Directors or a committee thereof, the use of the Prospectus forming a part of
the Registration Statement should be suspended until such time as an amendment
or supplement to the Registration Statement or the Prospectus has been filed by
the Company with the Commission and any such amendment to the Registration
Statement is declared effective by the Commission, or until such time as the
Company has filed an appropriate report with the Commission pursuant to the
Exchange Act. The Purchaser hereby covenants that the Purchaser will not sell
any Shares pursuant to the Prospectus during the period commencing at the time
at which the Company gives the Purchaser written notice of the suspension of the
use of the Prospectus and ending at the time the Company gives the Purchaser
written notice that the Purchaser may thereafter effect sales pursuant to the
Prospectus. The Company may, upon written notice to the Purchaser, suspend the
use of the Prospectus for up to thirty (30) days in any 365-day period based on
the reasonable determination of the Company's Board of Directors that there is a
significant business purpose for such determination, such as pending corporate
developments, public filings with the Commission or similar events. The Company
shall in no event be required to disclose the business purpose for which it has
suspended the use of the Prospectus if the Company determines in its good faith
judgment that the business purpose should remain confidential. In addition, the
Company shall notify each Purchaser (i) of any request by the Commission for an
amendment or any supplement to such Registration Statement or the Prospectus, or
any other information request by any other governmental agency directly relating
to
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the sale of Shares, and (ii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of any order
preventing or suspending the use of the Prospectus or the initiation or threat
of any proceeding for that purpose.
(c) The Purchaser further covenants to notify the Company promptly of the
sale of any of the Shares, other than sales pursuant to the Registration
Statement or sales upon termination of the transfer restrictions pursuant to
Section 1.4 of this Agreement.
3. MISCELLANEOUS
3.1 Counterparts
This Agreement may be executed in counterparts, each of which will be
deemed an original but all of which will be deemed one instrument.
3.2 Survival of Representations and Warranties
All representations and warranties made in this Agreement or any other
instrument or document delivered in connection herewith shall survive the
execution and delivery hereof.
3.3 Prior Agreements
This Agreement constitutes the entire agreement between the parties and
supersedes any prior or contemporaneous understandings or agreements concerning
the subject matter hereof.
3.4 Severability
The invalidity or unenforceability of any provision hereof shall in no way
affect the validity or enforceability of any other provision.
3.5 Governing Law
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York. The rights of the parties under this Agreement
are unique and, accordingly, the parties shall, in addition to such other
remedies as may be available to any of them at law or in equity, have the right
to enforce their rights hereunder by actions of specific performance to the
extend permitted by law.
3.6 Headings
Section and subsection headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of the Agreement
for any other purpose.
3.7 Amendments and Waivers
This Agreement may not be amended, supplemented or otherwise modified
except by an instrument in writing signed by both parties that specifically
refers to this Agreement. Either party hereto may, only by an instrument in
writing, waive compliance by the other party hereto with any term or provision
of this Agreement on the part of such other party to be performed or complied
with. The waiver by a party hereto of a breach of any term or provision of this
Agreement shall not be construed as a waiver of any subsequent breach. Any
amendment or waiver effected in accordance with this Section 2.7 shall be
binding upon each party and its permitted assigns.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
ULTRALIFE BATTERIES, INC.
By: ___________________________________
Name: _________________________________
Title: ________________________________
_______________________________________
_______________________________________
Print Name:
_______________________________________
Signature
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APPENDIX I
ULTRALIFE BATTERIES, INC.
REGISTRATION STATEMENT QUESTIONNAIRE
In connection with the preparation of the Registration Statement, please provide
us with the following information:
A. Pursuant to the "Selling Stockholder" section of the Registration
Statement, please state your or your organization's name exactly as it
should appear in the Registration Statement:
_________________________________________
B. Please provide the number of shares that you or your organization will own
immediately after Closing, including those Shares purchased by you or your
organization pursuant to this Purchase Agreement and those shares
purchased by you or your organization through other transactions:
_________________________________________
C. Have you or your organization had any position, office or other material
relationship within the past three years with the Company or its
affiliates?
_____ Yes _____ No
If yes, please indicate the nature of any such relationships below:
__________________________________________________
__________________________________________________
__________________________________________________
__________________________________________________
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APPENDIX II
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
The undersigned, an officer of, or other person duly authorized by
________________________________________________________________________________
[fill in official name of individual or institution]
hereby certifies that he/she/it is the Purchaser of the shares evidenced by the
attached certificate, and as such, sold such shares on ________________, 200__
in accordance with Registration Statement number 333-________________, and
complied with the requirement of delivering a current prospectus in connection
with such sale.
Print or Type:
Name of Purchaser (Individual or Institution):
________________________________________________________________________________
Name of Individual representing Purchaser (if an Institution)
________________________________________________________________________________
Title of Individual representing Purchaser (if an Institution):
________________________________________________________________________________
Signature:
Individual Purchaser or Individual representing Purchaser:
________________________________________________________________________________
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