EXHIBIT 10.54
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PIGGY-BACK REGISTRATION RIGHTS AGREEMENT
PIGGY-BACK REGISTRATION RIGHTS AGREEMENT ("Agreement") made as
of this 21st day of September, 2000 between TOWER TECH, INC., an Oklahoma
corporation, with its principal offices at ▇▇▇▇▇ ▇▇▇▇▇ ▇-▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Company") and the undersigned (the "Lender").
W I T N E S S E T H :
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WHEREAS, the Company has entered into a letter agreement (the
"Loan Agreement") with Taglich Brothers, Inc. ("Taglich Brothers") whereby
Taglich Brothers has agreed to use its best efforts to locate third parties
(collectively, the "Lenders") that will loan, in one or more tranches, in the
aggregate up to $500,000 to the Company (the "Loan"); and
WHEREAS, each tranche of the Loan will be evidenced by a
separate promissory note issued by the Company to each Lender (each a "Note" and
collectively, the "Notes"), and concurrent with funding part of the Loan, each
Lender will enter into an agreement with Taglich Brothers appointing Taglich
Brothers as collateral agent; and
WHEREAS, the indebtedness evidenced by the Notes is secured by
that certain Security Agreement, dated September 15, 2000, pursuant to which the
Company has granted to Taglich Brothers, as collateral agent, a security
interest in all of its right, title and interest in and to that certain License
Agreement, dated as of December 4, 1998, by and between the Company and Aggreko,
Inc., including, without limitation, the right to receive all license, royalty,
fee and other payments thereunder; and
WHEREAS, in consideration for the Lender's tranche of
$150,000.00, the Company has agreed to issue 120,000 shares (the "Loan Shares")
of its common stock, par value $.001 per share (the "Common Stock") to the
Lender; and
WHEREAS, it is a condition precedent for the Lender to make
its tranche of the Loan that this Agreement be executed by the undersigned.
NOW, THEREFORE, for and in consideration of the premises and
the mutual covenants hereinafter set forth, the parties hereto do hereby agree
as follows:
1. PIGGY-BACK REGISTRATION RIGHTS.
(a) The Company shall promptly issue the Loan Shares to the
Lender for no additional consideration. In the event that the Lender does not
receive the original stock
certificate for the Loan Shares within ten (10) days after the date hereof, the
Company shall issue additional shares of Common Stock (hereinafter, collectively
the "Additional Shares"; which together with the Loan Shares shall be referred
to as the "Registrable Securities") to the Lender equal to the product of (i)
ten (10%) percent of the number of Loan Shares to be issued and (ii) the number
of seven (7) day periods, or a part thereof, beyond said ten (10) day period
until the Registrable Securities are delivered to the Lender. The holders of the
Loan Shares, Additional Shares and any assignee thereof, shall hereinafter be
referred to as the "Registered Holders".
(b) The Registered Holders shall have certain "piggy-back"
registration rights with respect to the Registrable Securities as hereinafter
provided:
A. If at any time after the date hereof, the Company
shall file with the United States Securities and Exchange Commission ("SEC") a
registration statement under the Securities Act of 1933, as amended (the "1933
Act") (other than a registration statement on Form S-4 or Form S-8, or any
successor thereto, or filed in connection with an exchange offer) registering
any shares of Common Stock, the Company shall give written notice to each
Registered Holder thereof prior to such filing.
B. Within fifteen (15) days after such notice from the
Company, each Registered Holder shall give written notice to the Company as to
whether or not the Registered Holder desires to have all or any of the
Registered Holder's Registrable Securities included in the registration
statement. If a Registered Holder fails to give such notice within such period,
such Registered Holder shall not have the right to have such Registered Holder's
Registrable Securities registered pursuant to such registration statement. If a
Registered Holder gives such notice, then the Company shall include such
Registered Holder's Registrable Securities in the registration statement, at the
Company's sole cost and expense, subject to the remaining terms of this Section
1(b); provided, however, that each Registered Holder shall pay all underwriting
discounts, commissions and transfer taxes as well as his, her or its own counsel
fees, if any, relating to the sale of such Registered Holder's Registrable
Securities.
C. If the registration statement relates to an
underwritten offering, and the underwriter shall determine in writing that the
total number of shares of Common Stock to be included in the offering, including
the Registrable Securities, shall exceed the amount which the underwriter in its
sole discretion deems to be appropriate for the offering, the number of shares
of the Registrable Securities shall be reduced pro rata (based on the number of
Registrable Securities requested to be included). The Registered Holders
participating in the offering shall enter into such agreements as may be
reasonably required by the underwriters.
D. The Registered Holders shall have two (2)
opportunities to have the Registrable Securities registered under this Section
1(b).
E. The Registered Holder shall furnish in writing to
the Company such information as the Company shall reasonably require in
connection with a registration statement.
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F. The Company may, at any time and in its sole
discretion, decide not to proceed with the filing of a registration statement
which may have give rise to "piggy back" rights under this Section 1(b) or may
at any time terminate or suspend such registration, in which event each
Registered Holder's rights under this Section 1(b) as to the number of
opportunities to "piggy-back" shall be reset.
(c) If the Company effects any registration under the 1933
Act of any Registrable Securities pursuant to Section 1(a) or 1(b) above, the
Company shall indemnify, to the extent permitted by law, and hold harmless any
Registered Holder or other person or entity whose Registrable Securities are
included in such Registration Statement, any underwriter, any officer, director,
affiliate, shareholder, employee or agent of any Registered Holder or
underwriter, and each other person, if any, who controls any Registered Holder
or underwriter within the meaning of Section 15 of the 1933 Act, against any
losses, claims, damages, liabilities, judgment, fines, penalties, costs and
expenses, joint or several, or actions in respect thereof (collectively, the
"Claims"), to which each such indemnified party becomes subject, under the 1933
Act or otherwise, insofar as such Claims arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement or prospectus or any amendment or supplement thereto
or any document filed under a state securities or blue sky law (collectively,
the "Registration Documents") or insofar as such Claims arise out of or are
based upon the omission or alleged omission to state in any Registration
Document a material fact required to be stated therein or necessary to make the
statements made therein not misleading, and will reimburse any such indemnified
party for any legal or other expenses reasonably incurred by such indemnified
party in investigating or defending any such Claim; provided that the Company
shall not be liable in any such case to a particular indemnified party to the
extent such Claim is based upon an untrue statement or alleged untrue statement
of a material fact or omission or alleged omission of a material fact made in
any Registration Document in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such indemnified party
specifically for use in the preparation of such Registration Document.
(d) In connection with any registration statement in which
any Registered Holder is participating, each Registered Holder, severally and
not jointly, shall indemnify, to the extent permitted by law, and hold harmless
the Company, each of its directors, each of its officers who have signed the
registration statement, each other person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act, each other Registered Holder
and each underwriter, any officer, director, affiliate, shareholder, employee or
agent of any such other Registered Holder or underwriter and each other person,
if any, who controls such other Registered Holder or underwriter within the
meaning of Section 15 of the 1933 Act against any Claims to which each such
indemnified party may become subject under the 1933 Act or otherwise, insofar as
such Claims (or actions in respect thereof) are based upon any untrue statement
or alleged untrue statement of any material fact contained in any Registration
Document, or insofar as any Claims are based upon the omission or alleged
omission to state in any Registration Document a material fact required to be
stated therein or necessary to make the statements made therein not misleading,
and will reimburse any such indemnified party for any legal or other expenses
reasonably incurred by
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such indemnified party in investigating or defending any such Claim; provided,
however, that such indemnification or reimbursement shall be payable only if,
and to the extent that, any such Claim arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Registration Document in reliance upon and in conformity with written
information furnished to the Company by the Registered Holder specifically for
use in the preparation thereof.
(e) Any person entitled to indemnification under Section
1(c) or 1(d) above shall notify promptly the indemnifying party in writing of
the commencement of any Claim if a claim for indemnification in respect thereof
is to be made against an indemnifying party under this Section 1(e), but the
omission of such notice shall not relieve the indemnifying party from any
liability which it may have to any indemnified party under Section 1(c) or 1(d)
above, except to the extent that such failure shall materially adversely affect
any indemnifying party or its rights hereunder. In case any action is brought
against the indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
in, and, to the extent that it chooses, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party; and, after notice from
the indemnifying party to the indemnified party that it so chooses, the
indemnifying party shall not be liable for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof; provided, however, that (i) if the indemnifying party fails to take
reasonable steps necessary to defend diligently the Claim within twenty (20)
days after receiving notice from the indemnified party such that the indemnified
party believes it has failed to do so; (ii) if the indemnified party who is a
defendant in any action or proceeding which is also brought against the
indemnifying party reasonably shall have concluded that there are legal defenses
available to the indemnified party which are not available to the indemnifying
party; or (iii) if representation of both parties by the same counsel is
otherwise inappropriate under applicable standards of professional conduct, the
indemnified party shall have the right to assume or continue its own defense as
set forth above (but with no more than one firm of counsel for all indemnified
parties, except to the extent any indemnified party or parties reasonably shall
have concluded that there are legal defenses available to such party or parties
which are not available to the other indemnified parties or to the extent
representation of all indemnified parties by the same counsel is otherwise
inappropriate under applicable standards of professional conduct) and the
indemnifying party shall be liable for any reasonable expenses therefor;
provided, that no indemnifying party shall be subject to any liability for any
settlement of a Claim made without its consent (which may not be unreasonably
withheld, delayed or conditioned). If the indemnifying party assumes the defense
of any Claim hereunder, such indemnifying party shall not enter into any
settlement without the consent of the indemnified party if such settlement
attributes liability to the indemnified party.
(f) If for any reason the indemnity provided in Section
1(c) or 1(d) above is unavailable, or is insufficient to hold harmless, an
indemnified party, then the indemnifying party shall contribute to the amount
paid or payable by the indemnified party as a result of any Claim in such
proportion as is appropriate to reflect the relative benefits received by the
indemnifying party on the one hand and the indemnified party on the other from
the transactions contemplated by this
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Agreement. If, however, the allocation provided in the immediately preceding
sentence is not permitted by applicable law, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the indemnifying party and the indemnified party as well
as any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the indemnifying party or by
the indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable in respect of any Claim shall be deemed to include
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such Claim. Notwithstanding the
foregoing, no underwriter or controlling person thereof, if any, shall be
required to contribute, in respect of such underwriter's participation as an
underwriter in the offering, any amount in excess of the amount by which the
total price at which the Registrable Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such underwriter 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 ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The obligation of any
underwriters to contribute pursuant to this paragraph (f) shall be several in
proportion to their respective underwriting commitments and not joint.
(g) The provisions of Section 1(c) through 1(f) of this
Agreement shall be in addition to any other rights to indemnification or
contribution which any indemnified party may have pursuant to law or contract
and shall remain operative and in full force and effect regardless of any
investigation made or omitted by or on behalf of any indemnified party and shall
survive the transfer of the Registrable Securities by any such party.
(h) If and whenever the Company is required by the
provisions of this Section 1 to use its best efforts to register any Registrable
Securities under the 1933 Act, the Company shall, as expeditiously as possible
under the circumstances and subject to the terms of this Section 1:
A. Prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use its best efforts
to cause such registration statement to become effective as soon as possible
after filing and remain effective.
B. Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement current and
effective and to comply with the provisions of the 1933 Act, and any regulations
promulgated thereunder, with respect to the sale or disposition of all
Registrable Securities covered by the registration statement required to effect
the distribution of the securities, but in no event shall the Company be
required to do so for a period of more than three (3) years following the date
hereof.
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C. Furnish to the Registered Holders participating in
the offering, copies (in reasonable quantities) of summary, preliminary, final,
amended or supplemented prospectuses, in conformity with the requirements of the
1933 Act and any regulations promulgated thereunder, and other documents as
reasonably may be required in order to facilitate the disposition of the
securities, but only while the Company is required under the provisions hereof
to keep the registration statement current.
D. Use its best efforts to register or qualify the
Registrable Securities covered by such registration statement under such other
securities or blue sky laws of such jurisdictions of the United States as the
Registered Holders participating in the offering shall reasonably request, and
do any and all other acts and things which may be reasonably necessary to enable
each participating Registered Holder to consummate the disposition of the
Registrable Securities in such jurisdictions.
E. Notify each Registered Holder selling Registrable
Securities, at any time when a prospectus relating to any such Registrable
Securities covered by such registration statement is required to be delivered
under the 1933 Act, of the Company's becoming aware that the prospectus included
in such registration statement, as then in effect, includes an untrue statement
of a material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading in the light
of the circumstances then existing, and promptly prepare and furnish to each
such Registered Holder selling Registrable Securities a reasonable number of
copies of a prospectus supplemented or amended so that, as thereafter delivered
to the purchasers of such Registrable Securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing.
F. As soon as practicable after the effective date of
the registration statement, and in any event within eighteen (18) months
thereafter, make generally available to Registered Holders participating in the
offering an earnings statement (which need not be audited) covering a period of
at least twelve (12) consecutive months beginning after the effective date of
the registration statement which earnings statement shall satisfy the provisions
of Section 11(a) of the 1933 Act, including, at the Company's option, Rule 158
thereunder. To the extent that the Company files such information with the SEC
in satisfaction of the foregoing, the Company need not deliver the above
referenced earnings statements to Registered Holders.
G. Upon request, deliver promptly to counsel of each
Registered Holder participating in the offering copies of all correspondence
between the SEC and the Company, its counsel or auditors and all memoranda
relating to discussions with the SEC or its staff with respect to the
registration statement and permit each such Registered Holder to do such
investigation at such Registered Holder's sole cost and expense, upon reasonable
advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary. Each Registered Holder
agrees that it will use its best efforts not to interfere unreasonably with the
Company's business when conducting any such investigation and each Registered
Holder shall keep any such information received pursuant to this Section
confidential.
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H. Provide a transfer agent located in the United
States for all such Registrable Securities covered by such registration
statement not later than the effective date of such registration statement.
I. List the Registrable Securities covered by such
registration statement on such exchanges and/or on the NASDAQ as the Common
Stock is then currently listed upon.
J. Pay all Registration Expenses incurred in connection
with a registration of Registrable Securities, whether or not such registration
statement shall become effective; provided that each Registered Holder shall pay
all underwriting discounts, commissions and transfer taxes, and its own counsel
fees, if any, relating to the sale or disposition of such Registered Holder's
Registrable Securities pursuant to a registration statement. As used herein,
"Registration Expenses" means any and all reasonable and customary expenses
incident to performance of or compliance with the registration rights set forth
herein, including, without limitation, (i) all SEC and stock exchange or
National Association of Securities Dealers, Inc. registration and filing fees,
(ii) all fees and expenses of complying with state securities or blue sky laws
(including reasonable fees and disbursements of counsel for the underwriters in
connection with blue sky qualifications of the Registrable Securities, but no
other expenses of the underwriters or their counsel), (iii) all printing,
messenger and delivery expenses, and (iv) the reasonable fees and disbursements
of counsel for the Company and the Company's independent public accountants.
(i) The Company acknowledges that there is no adequate
remedy at law for failure by it to comply with the provisions of this Section 1
and that such failure would not be adequately compensable in damages, and
therefore agrees that its agreements contained in this Section 1 may be
specifically enforced. In the event that the Company shall fail to file such
registration statement when required pursuant to Section 1(a) above or to keep
any registration statement effective as provided in this Section 1 or otherwise
fails to comply with its obligations and agreements in this Section 1, then, in
addition to any other rights or remedies the Registered Holders may have at law
or in equity, including without limitation, the right of rescission, the Company
shall indemnify and hold harmless the Registered Holders from and against any
and all manner or loss which they may incur as a result of such failure. In
addition, the Company shall also reimburse the Registered Holders for any and
all reasonable legal fees and expenses incurred by them in successfully
enforcing their rights pursuant to this Section 1, regardless of whether any
litigation was commenced.
2. MISCELLANEOUS.
2.1 The Company agrees to use its best efforts to file
timely all reports required to be filed by it pursuant to Sections 13 or 15 of
the 1934 Act, and to provide such information as will permit the holder to sell
the Common Stock acquired by it pursuant to the Offering in accordance with Rule
144 under the 1933 Act.
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2.2 All notices, consents and other communications under
this Agreement shall be in writing and shall be deemed to have been duly given
(a) when delivered by hand, (b) one business day after the business day of
transmission if sent by telecopier (with receipt confirmed), provided that a
copy is mailed by certified mail, return receipt requested, or (c) one business
day after the business day of deposit with the carrier, if sent for next
business day delivery by Express Mail, Federal Express or other recognized
express delivery service (receipt requested), in each case addressed to the
Company at the address indicated on the first page of this Agreement marked
"Attention: Chief Financial Officer", and to the Lender at its address indicated
on the last page of this Agreement (or to such other address and telecopier
number as a party may designate as to itself by notice to the other parties).
2.3 This Agreement shall not be changed, modified or
amended except by a writing signed by the parties to be charged, and this
Agreement may not be discharged except by performance in accordance with its
terms or by a writing signed by the party to be charged.
2.4 This Agreement shall be binding upon and inure to the
benefit of the parties hereto and to their respective heirs, legal
representatives, successors and assigns. This Agreement sets forth the entire
agreement and understanding between the parties as to the subject matter thereof
and merges and supersedes all prior discussions, agreements and understandings
of any and every nature among them.
2.5 Notwithstanding the place where this Agreement may be
executed by any of the parties hereto, the parties expressly agree that all the
terms and provisions hereof shall be construed in accordance with and governed
by the laws of the State of New York. The parties hereby agree that any dispute
which may arise between them arising out of or in connection with this Agreement
shall be adjudicated before a court located in New York and they hereby submit
to the exclusive jurisdiction of the courts of the State of New York and of the
federal courts in New York with respect to any action or legal proceeding
commenced by any party, and irrevocably waive any objection they now or
hereafter may have respecting the venue of any such action or proceeding brought
in such a court or respecting the fact that such court is an inconvenient forum,
relating to or arising out of this Agreement or any acts or omissions relating
to the sale of the securities hereunder, and consent to the service of process
in any such action or legal proceeding by means of registered or certified mail,
return receipt requested, in case of the address set forth below or such other
address as the undersigned shall furnish in writing to the other.
2.6 This Agreement may be executed in counterparts. Upon
the execution and delivery of this Agreement by the Lender, this Agreement shall
become a binding obligation of the Lender with respect to the purchase of the
Common Stock as herein provided; subject, however, to the right hereby reserved
to the Company to enter into the same agreements with other subscribers and to
add and/or to delete other persons as subscribers.
2.7 The holding of any provision of this Agreement to be
invalid or unenforceable by a court of competent jurisdiction shall not affect
any other provision of this Agreement, which shall remain in full force and
effect.
2.8 It is agreed that a waiver by either party of a breach
of any provision of this Agreement shall not operate, or be construed, as a
waiver of any subsequent breach by that same party.
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2.9 The parties agree to execute and deliver all such
further documents, agreements and instruments and take such other and further
action as may be necessary or appropriate to carry out the purposes and intent
of this Agreement.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the day and year first written above.
TOWER TECH, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, CFO
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: Chief Financial Officer
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LENDER:
SHADOW CAPITAL LLC
By: /s/ B. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
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Name: B. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Manager
Address for Notice: ▇▇▇▇ ▇.▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: B. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
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