<PAGE> 1
As filed with the Securities and Exchange Commission on July 12, 1999
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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BOLDER TECHNOLOGIES CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 84-1166231
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
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4403 TABLE MOUNTAIN PARKWAY
GOLDEN, COLORADO 80403
(303) 215-7200
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
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DANIEL S. LANKFORD
PRESIDENT AND CHIEF EXECUTIVE OFFICER
BOLDER TECHNOLOGIES CORPORATION
4403 TABLE MOUNTAIN PARKWAY
GOLDEN, COLORADO 80403
(303) 215-7200
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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COPIES TO:
JAMES H. CARROLL, ESQ.
COOLEY GODWARD LLP
2595 CANYON BOULEVARD, SUITE 250
BOULDER, CO 80302
(303) 546-4000
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APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC:
From time to time after the registration statement becomes effective.
If any of the securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box /X/.
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
CALCULATION OF REGISTRATION FEE
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AMOUNT TO BE PROPOSED MAXIMUM OFFERING PROPOSED MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE REGISTERED REGISTERED PRICE PER SHARE (1) OFFERING PRICE (1) REGISTRATION FEE
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Common Stock, par value $.001 (2) 2,053,182 shares $8.3125 $17,067,076 $4,744.65
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(1) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(c) based on the average of the high
and low sale prices of the Registrant's common stock as reported on The
NASDAQ National Market on July 8, 1999.
(2) Includes Preferred Share Purchase Rights ("Rights"). The Rights are
associated with and trade with the Common Stock. The value, if any,
attributable to the Rights is reflected in the market price of the Common
Stock.
The Registrant hereby amends this registration statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment that specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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<PAGE> 2
SUBJECT TO COMPLETION DATED JULY 12, 1999
PROSPECTUS
2,053,182 SHARES
[LOGO]
BOLDER TECHNOLOGIES CORPORATION
COMMON STOCK
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This Prospectus covers 2,053,182 shares of common stock of BOLDER
Technologies Corporation. The selling stockholders identified in this Prospectus
may sell these shares of common stock from time to time on terms to be
determined at the time of sale. We will not receive any of the proceeds from the
sale of shares by the selling stockholders.
Our shares trade on The NASDAQ National Market under the symbol "BOLD."
On July 8, 1999, the closing sale price of the common stock, as reported on The
NASDAQ National Market, was $8.375.
The selling stockholders may sell the shares of common stock described
in this Prospectus in public or private transactions, on or off The NASDAQ
National Market, at prevailing market prices, or at privately negotiated prices.
The selling stockholders may sell shares directly to purchasers or through
brokers or dealers. Brokers or dealers may receive compensation in the form of
discounts, concessions or commissions from the selling stockholders. We have
agreed to indemnify the selling stockholders and certain other persons against
certain liabilities, including liabilities under the Securities Act of 1933.
We will not be paying any underwriting commissions or discounts in the
offering of these shares. We will, however be paying for the expenses incurred
in the offering of the shares. For their shares, the selling stockholders will
receive the purchase price of the shares sold less any agents' commissions and
underwriters' discounts and other related expenses. More information is provided
in the section titled "Plan of Distribution" on page 17.
Our address and telephone number are: BOLDER Technologies Corporation.,
4403 Table Mountain Parkway, Golden, Colorado 80403, (303) 215-7200.
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THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD ACQUIRE
SHARES ONLY IF YOU CAN AFFORD A COMPLETE LOSS. SEE "RISK FACTORS" BEGINNING ON
PAGE 6.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.
WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
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, 1999
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TABLE OF CONTENTS
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Page
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Where You Can Find More Information................................. 2
The Company......................................................... 4
Forward-Looking Statements.......................................... 5
Risk Factors........................................................ 6
Use of Proceeds..................................................... 14
Selling Stockholders................................................ 15
Plan of Distribution................................................ 17
Description of Capital Stock........................................ 18
Legal Matters....................................................... 21
Experts............................................................. 22
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WHERE YOU CAN FIND MORE INFORMATION
BOLDER Technologies Corporation files reports, proxy statements and
other information with the Securities and Exchange Commission. You may inspect
and copy such material at the public reference facilities maintained by the SEC
at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the SEC's
regional offices at Northwestern Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661, and at Seven World Trade Center, New York, New
York 10048. You can also inspect such materials at The National Association of
Securities Dealers, 1735 K Street, N.W., Washington, D.C.
Please call the SEC at 1-800-SEC-0330 for more information on the
public reference rooms. You can also find our SEC filings at the SEC's web site,
"http://www.sec.gov."
The SEC allows BOLDER Technologies Corporation to "incorporate by
reference" the information that we file with them, which means that we can
disclose important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
Prospectus. Information in this Prospectus supercedes information incorporated
by reference which we filed with the SEC prior to the date of this Prospectus.
Information that we file later with the SEC will automatically update and
supercede this information. We incorporate by reference the documents listed
below and any future filings we make with the SEC to under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934:
o Annual Report on Form 10-K for the fiscal year ended December 31,
1998;
o Quarterly Report on Form 10-Q for the period ended March 31, 1999;
o Definitive Proxy Statement dated April 30, 1999; and
o The description of common stock contained in BOLDER Technologies
Corporation's Registration Statement on Form 8-A declared
effective by the Commission on April 29, 1996, including any
amendment or reports filed for the purpose of updating such
description.
2.
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You may request a copy of these filings (excluding exhibits which are
not specifically incorporated by reference into this Prospectus), at no cost to
you, by writing or telephoning BOLDER Technologies Corporation at:
BOLDER Technologies Corporation
4403 Table Mountain Parkway
Golden, Colorado 80403
Attention: Investor Relations
Telephone: (303) 215-7200
http://www.boldertmf.com
This Prospectus constitutes a part of a registration statement on Form
S-3 that has been filed with the SEC. SEC rules permit us to omit certain of the
information contained in the registration statement. For such information,
please refer to the registration statement on file with the SEC, including the
exhibits to the registration statement. The information contained on our Web
site does not constitute a part of this Prospectus.
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YOU SHOULD RELY ONLY UPON THE INFORMATION CONTAINED IN THIS DOCUMENT OR
DOCUMENTS TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED ANYONE TO
PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT. YOU SHOULD NOT ASSUME THAT THE
INFORMATION IN THIS PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON
THE FRONT OF THIS PROSPECTUS.
3.
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THE COMPANY
BOLDER Technologies Corporation ("Bolder" or the "Company") is an
energy technology company that is developing and commercializing advanced, high
power, rechargeable battery systems based on its patented thin metal film
("TMF") technology. The Company's TMF battery uses proven lead acid
electrochemistry in a proprietary configuration that has higher power density
than any other commercially available battery system. The Company believes that
its TMF batteries are attractive for many existing battery-powered applications
that require very large bursts of power, and will enable new applications that
could not previously be powered by batteries. The Company believes that the
combination of the following characteristics of its prototype TMF battery
systems offers advantages over commercially available rechargeable batteries in
a broad range of current and future applications:
o HIGH POWER. The Company believes its TMF batteries can deliver
higher sustained power density than any other commercially
available battery technology. This is important in existing
applications such as high power/pulse power tools, specialty
standby power, power quality and engine starting, and may enable
new applications ranging from high performance hybrid electric
vehicles to an automotive starting battery that weighs
substantially less than conventional automotive starting
batteries.
o COST EFFECTIVE. TMF batteries are manufactured using inexpensive,
readily available raw materials. In addition, the Company believes
its manufacturing process will be cost effective at high volumes.
o NO MEMORY EFFECT. TMF batteries do not suffer from the memory
effect that reduces the capacity of nickel cadmium ("NiCd")
batteries if they are partially discharged and recharged
repeatedly.
o SMALL SIZE. In high power applications, such as high power/pulse
power tools, automotive starting and standby power, TMF batteries
can do the same amount of work as much larger conventional
rechargeable batteries. Since the battery system typically
accounts for a significant part of the physical volume and weight
of these products, TMF technology can make such products easier to
use and/or less expensive to manufacture by enabling reductions in
product size.
o FASTER RECHARGE. TMF batteries can be recharged to full capacity
in less than five minutes with an appropriate charger, allowing
the device to be back to work quickly, thus increasing the "up
time" of the device.
o STABLE DISCHARGE VOLTAGE. In some applications, notably standby
power, electronic circuits must be used to compensate for the
voltage drop during discharge of other types of rechargeable
batteries. TMF batteries have very stable voltage during high rate
discharge, and thus provide more consistent performance and
potentially reduce the need for and cost of voltage regulation.
o COOL OPERATION. High power operation of batteries typically
generates significant heat that must be accommodated in the design
of products, such as standby power systems or professional power
tools. The low impedance of TMF batteries greatly reduces the
amount of heat generated by the battery, thus simplifying product
design.
o SUPERIOR COLD TEMPERATURE OPERATION. All batteries lose capacity
as the temperature drops. TMF batteries lose much less of their
room temperature capacity at lower temperatures than do
conventional batteries.
o EXTREMELY RAPID RESPONSE. TMF batteries deliver energy when
requested much more rapidly than conventional batteries.
o EASY TO RECYCLE. Environmental concerns have made recycling of
batteries increasingly important. Unlike many existing and
emerging battery technologies, TMF batteries are readily handled
by the well developed recycling process that is currently used to
recycle approximately 90 percent of the lead acid batteries in the
United States.
4.
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The Company has focused its initial product development efforts on its
sub-C cell, which was introduced in October 1998. The sub-C cell can be used as
a modular building block for battery packs that can be used in a variety of
applications. The Company has also introduced its TMF REBELTM rechargeable
battery packs. Based on the core product sub-C cell, the high power TMF REBEL
product line includes battery modules ranging from 6 to 24 volts. The sub-C cell
is produced on an automated production line located in the Company's 127,000
square foot leased facility in Golden, Colorado. This facility has been designed
to accommodate multiple production lines and two research and development lines,
as well as all of the Company's other operations. The qualification of the
Company's first high-volume production line was completed in September 1998, and
the Company is currently producing a few thousand sub-C cells per month that are
being used as samples, to fulfill small orders, and as experiments to improve
the product and the production process. The Company does not expect significant
volume shipments to begin prior to the second half of 1999.
An integral part of the Company's strategy is to work with OEM
customers and strategic partners to develop market opportunities and leverage
its resources. For example, the Company intends to channel a portion of its
sales through value added partners ("VAPs"), and the Company has established
agreements with five VAPs to market TMF batteries throughout North America and
Europe. The Company believes that VAP sales will help the Company develop new
applications and market segments.
The Company is also seeking opportunities to increase the share of
value it obtains from those applications that can uniquely benefit from the
capabilities of TMF batteries. Consistent with this strategy, the Company has
announced that it will introduce a line of end-user products based on TMF
batteries during the second half of 1999, including emergency starting products
for cars, trucks, and other engine powered vehicles. These products will be
designed and produced by the Company and sold to end users through various sales
channel partners. The Company expects these products to be attractive because
they will be small and lighter and perform better than existing products used
for this function. The Company does not expect a significant volume of product
shipments and resulting revenues prior to the second half of 1999.
During 1998, the Company completed a technology transfer program with
Johnson Controls, Inc. ("JCI"), one of the world's leading suppliers of
automotive batteries. The Company has licensed JCI to produce and sell TMF
batteries for certain specific market segments.
The Company was incorporated in Colorado in 1991 and reincorporated in
Delaware in 1993. The Company's executive offices are located at 4403 Table
Mountain Drive, Golden, Colorado 80403, and its telephone number is (303)
215-7200.
References in this Prospectus to the "Company," "Bolder," "we," "our,"
and "us" refer to BOLDER Technologies Corporation, a Delaware corporation.
Information contained in BOLDER Technologies Corporation's web site does not
constitute part of this Prospectus.
FORWARD-LOOKING STATEMENTS
Statements about our expectations and all other statements made in this
registration statement or incorporated by reference hereby, other than
historical facts, are forward-looking statements. Those statements include words
such as "anticipate," "estimate," "project," "intend" and similar expressions
which we have used to identify these statements as forward-looking statements.
These statements appear throughout this Prospectus and are statements regarding
our intent, belief, or current expectations, primarily with respect to the
operations of BOLDER Technologies Corporation or related industry developments.
You are cautioned that any such forward-looking statements do not guarantee
future performance and involve risks and uncertainties, and that actual results
could differ materially from those discussed here and in the documents
incorporated by reference in this Prospectus. These factors, as and when
applicable, are discussed in BOLDER Technologies Corporation's filings with the
Securities and Exchange Commission (the "Commission"), including its most recent
annual report on Form 10-K, a copy of which may be obtained from BOLDER
Technologies Corporation without charge. See "Where You Can Find More
Information."
5.
<PAGE> 7
RISK FACTORS
An investment in the shares of our common stock being offered by this
Prospectus involves a high degree of risk. The risks and uncertainties described
below are not the only ones we face. Additional risks and uncertainties not
presently known to us or that we currently deem immaterial may also impair our
business.
If any of the events described in the following risks actually occur,
our business, financial condition and operating results could be materially
adversely affected. In such case, the trading price of our common stock could
decline, and you may lose all or part of your investment.
WE ARE A DEVELOPMENT STAGE COMPANY, HAVE A LIMITED OPERATING HISTORY AND ARE
SUBJECT TO MANY RISKS APPLICABLE TO A YOUNG COMPANY.
Since our inception in 1991, we have been principally engaged in
research and development activities relating to our TMF batteries. To date, our
revenues have been derived solely from technology transfer services, license
fees, federal Small Business Innovation Research research and development
agreements, customer funded research and development agreements and limited
sales of prototype batteries for evaluation purposes only. Since inception, we
have generated revenues of only $335,000 from sales of our batteries. We did not
commence initial, limited commercial production of its TMF batteries until
October 1998. We do not expect a significant volume of product shipments and
resulting product sales revenues prior to the second half of 1999. The market
for our products is unproven.
We will encounter the risks and difficulties frequently encountered by
development stage companies in new and evolving markets. We may not successfully
address any of these issues.
WE HAVE A HISTORY OF LOSSES, WE EXPECT TO LOSE MONEY IN THE FUTURE AND WE MAY
NOT ACHIEVE OR SUSTAIN PROFITABILITY.
We have not achieved profitability or material revenues from the sale
of battery products. As of March 31, 1999, we had an accumulated deficit of
$35.7 million. We do not expect to have material product revenues until the
second half of 1999 at the earliest. We do not expect to have a profitable
quarter in 1999 or 2000. We expect to incur significant losses as we continue to
incur significant sales and marketing, research and development and general and
administrative expenses. We may never be profitable. Even if we do achieve
profitability, we may not sustain or increase profitability on a quarterly or
annual basis in the future.
MARKET ACCEPTANCE OF OUR TMF BATTERIES IS UNCERTAIN.
The market for our battery products is unproven and our products have
not achieved any degree of market acceptance. To achieve market acceptance, our
TMF batteries must offer significant price and/or performance advantages over
other current and potential alternative battery technologies in a broad range of
applications. We cannot guarantee that our rechargeable TMF batteries will
achieve or sustain any such advantages. Even if our rechargeable TMF batteries
provide meaningful price or performance advantages, we cannot be certain that
they will achieve or maintain market acceptance in any potential market
application. The success of our products also will depend upon the level of
market acceptance of OEMs' and other customers' end products which incorporate
our TMF batteries, over which we have no control. We expect that our future
financial performance will depend significantly on the successful sales,
implementation and market acceptance of the Company's battery products, which
may not occur on a timely basis or at all.
OUR SUCCESS WILL DEPEND ON OUR ABILITY TO MEET OEM CUSTOMER REQUIREMENTS.
Our success will depend significantly on our ability to meet OEM
customer requirements by developing and introducing on a timely basis new
products and enhanced or modified versions of our existing products. OEMs often
require unique configurations or custom designs for battery systems which must
be developed and integrated in the OEM's product well before the product is
launched by the OEM. As a result, a substantial lead time often
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<PAGE> 8
exists between the commencement of design efforts for a customized battery
system and the commencement of volume shipments of the battery system to the
OEM.
If we are unable to design, develop and introduce products that meet
OEMs' exacting requirements on a timely basis, our business, operating results
and financial condition will be materially adversely affected.
WE ARE NOT EXPERIENCED IN THE RETAIL MARKETING OF END-USER PRODUCTS. WE WILL
DEPEND UPON OUTSIDE SALES REPRESENTATIVES AND RESELLERS TO DEVELOP THE RETAIL
SALES CHANNEL FOR OUR END-USER PRODUCTS.
We have announced plans to introduce a line of end-user products based
on TMF batteries during the second half of 1999. We expect that end-user
products will account for a significant portion of our product revenues. We
intend to market these products in retail stores and other consumer distribution
outlets. We do not have any experience in the promotion, advertising and
distribution of retail products to consumers, and our efforts to develop a
retail sales channel may be unsuccessful.
To develop the retail sales channel, we will depend upon outside sales
representatives, distributors, resellers and retail operators. It is likely that
our agreements with such persons will not be exclusive, will not have minimum
purchase or resale requirements, and may be terminated by either party without
cause. These persons may carry products that are competitive with our products,
may not give a high priority to the marketing of our products, or may not
continue to carry our products. They may give a higher priority to other
products, including the products of competitors. We may not be able to obtain or
retain the sales representatives, distributors, resellers or retailers needed to
develop the retail sales channel.
WE WILL RELY ON ORIGINAL EQUIPMENT MANUFACTURERS AND NEED TO DEVELOP THIS SALES
CHANNEL. IF OUR ORIGINAL EQUIPMENT MANUFACTURER CHANNEL DOES NOT PERFORM
ADEQUATELY, OUR BUSINESS COULD BE SERIOUSLY HARMED.
We expect that product sales to OEMs will account for a significant
portion of our product revenues. We may fail to implement this strategy. We are
currently investing, and intend to continue to invest, resources to develop this
sales channel. Such investments could seriously harm our operating margins. We
depend on our OEMs' abilities to develop product enhancements or new products on
a timely and cost-effective basis that will meet changing customer needs and
respond to emerging industry standards and other technological changes. Our OEMs
may not effectively meet these technological challenges. These original
equipment manufacturers:
o Are not within our control;
o May incorporate into their products the technologies of other
companies in addition to or in place of our technologies; and
o Are not obligated to purchase our products.
Our OEMs may not continue to carry our products. Our inability to
recruit, or our loss of, important original equipment manufacturers could
seriously harm our business.
WE ARE DEPENDENT UPON EFFECTIVE STRATEGIC RELATIONSHIPS.
We expect to rely on a limited number of strategic relationships to
accelerate the commercialization of our products by assisting in the design and
development of products for certain applications, as well as to provide
manufacturing and marketing expertise. We currently have strategic relationships
with Johnson Controls and five VAPs located throughout North America and Europe.
We may be unable to enter into any other such partnerships and existing
relationships may not achieve their goals. The success of any strategic
partnership is dependent upon the following:
o the general business condition of the partner;
7.
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o its commitment to the strategic partnership;
o the skills and experience of its employees responsible for the
strategic partnership; and
o the partner's timely and satisfactory performance of its obligations
under the partnership.
To the extent we enter into strategic partnerships, the terms of the
partnerships may require us and our partners to share revenues and/or expenses
from certain activities or for us to grant to our partners licenses to
manufacture, market and/or sell products based upon our TMF technology, which
could adversely affect our business, operating results and financial condition.
WE ARE DEPENDENT ON OUR VALUE ADDED PARTNER NETWORK.
We intend to channel a significant portion of our sales through VAPs in
the future. We currently have a VAP network of five distributors throughout
North America and Europe. Our VAP agreements are subject to minimum performance
criteria and standard termination provisions. VAPs may sell competitive
products. Although we have established multiple sources for VAP services for our
products, any disruption of operations at certain of our VAPs or the loss of
certain of our VAPs could materially adversely affect our business, operating
results and financial condition.
WE ARE IN THE EARLY STAGES OF MANUFACTURING AND MUST CONTINUE TO DEVELOP OUR
MANUFACTURING CAPABILITIES.
The difficulties and risks related to the implementation of our
manufacturing line and new process technology have in the past and may in the
future materially and adversely affect our operating results.
We did not commence initial commercial production of our TMF batteries
until October 1998. We are currently producing only a limited number of
batteries per month that are being used as samples, to fulfill small orders, and
as experiments to improve the product and the production process. Although our
initial automated production line is installed, qualified and functional, we
have not yet operated this line at full capacity over an extended period of
time.
A key determinant of our current and future production capacity and
profitability is the production yield of our manufacturing process. Failure to
achieve acceptable yields of commercial quality batteries in commercial
quantities, and thereby reduce our unit manufacturing costs, would negatively
affect our profitability. In addition, failure to continue volume manufacturing
on a timely basis could damage customer relationships and result in lost
opportunities. Any such failure would have a material adverse effect on our
business, operating results and financial condition.
In order to continue to scale up our manufacturing capacity, we will
need to complete fabrication, installation and qualification of our additional
automated production lines. In addition, as part of our manufacturing ramp-up,
we will need to hire and train a substantial number of new manufacturing
workers. The availability of skilled and unskilled workers in the Denver
metropolitan area, the site of our manufacturing facility, is limited due to a
relatively low unemployment rate. The continued implementation of our
manufacturing facility will continue to require substantial engineering work and
expenses and is subject to significant risks, including risks of cost overruns
and significant delays.
WE MAY NOT BE ABLE TO COMPETE SUCCESSFULLY IF WE FAIL TO KEEP PACE WITH RAPIDLY
CHANGING BATTERY TECHNOLOGIES.
The battery industry has experienced, and is expected to continue to
experience, rapid technological change. Various companies are seeking to enhance
traditional battery technologies, such as lead acid and NiCd, and other
companies have recently introduced or are developing rechargeable batteries
based on nickel metal hydride, lithium and other emerging and potential
technologies. If competing technologies that outperform our batteries are
8.
<PAGE> 10
developed and successfully introduced, our business, operating results and
financial condition will be materially adversely affected.
WE MAY NOT BE ABLE TO OBTAIN ADDITIONAL CAPITAL TO FUND OUR OPERATIONS WHEN
NEEDED.
We will require substantial funds to build and operate commercial
manufacturing facilities, to market our products and to conduct the necessary
research and development and testing of our products. We believe that our
current cash reserves and cash flows from operations should be adequate to fund
our operations at least through year-end 1999. In order to continue planned
operations beyond 1999 and to provide funds for future production lines, we will
need to access additional sources of equity capital or debt. If our capital
requirements or revenue vary materially from our current plans or if unforeseen
circumstances occur, we may require additional financing sooner than we
anticipate. We are unable to predict the precise amount of future capital that
we may require. Additional financing may not be available when we require it,
and the form and terms of any such available financing may not be acceptable.
If we cannot obtain adequate funds on acceptable terms, then:
o we may have to delay, scale back or eliminate one or more of our
development programs;
o we may have to delay, scale back or eliminate any substantial
expansion of fully-automated manufacturing capacity;
o we may have to curtail or otherwise discontinue the development,
manufacture or sale of our TMF battery systems;
o we may have to sell additional securities on terms that could be
dilutive to our stockholders;
o we may be unable to take advantage of strategic opportunities or
respond to competitive pressures;
o we may be unable to develop or enhance our products; and
o we may have to seek a merger partner or suspend operations.
Any of these failures could have a material adverse effect on our
business, operating results and financial condition.
INTENSE COMPETITION EXISTS IN THE BATTERY INDUSTRY AND WE EXPECT COMPETITION TO
CONTINUE TO INTENSIFY.
Competition in the battery industry is intense. We expect that
competition will continue to intensify.
We believe that our primary competitors are existing suppliers of NiCd
and lead acid suppliers. In applications such as portable tools and appliances
and certain electronic and medical products, our primary competitors are
suppliers of NiCd batteries, including:
o SANYO Energy (USA) Corporation;
o Panasonic Industrial Company, a division of Matsushita Electric
Corporation of America;
o Energizer Power Systems, a division of Eveready Battery Company; and
o SAFT America, Inc.
9.
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In applications such as car starting, standby power, very small
batteries for engine starting and a few medical and electronics applications,
our primary competitors are suppliers of lead acid batteries:
o Suppliers of small lead acid batteries used in non-automotive
applications include Yuasa Exide, Inc., Exide Corporation,
Matsushita Electric Corporation of America, Hawker Energy Products,
Inc., CSB Battery of America Corp. and GS Battery USA, Inc., a
division of Japan Storage Battery Co., Limited; and
o Suppliers of automotive batteries include Johnson Controls, Inc.,
Exide Corporation, GNB Inc. and Delphi Automotive Systems
Corporation, formerly a division of General Motors Corporation.
In addition, we have granted Johnson Controls certain license rights
which allow Johnson Controls to compete with us in lawn and garden starting,
motorcycle starting, HEV, standby power and, beginning July 1, 1999, in
emergency jump-starting batteries for lawn and garden starting, motorcycle
starting and automobile and truck starting.
We may not be able to compete successfully against our current or
future competitors. Many of our competitors have established positions in the
market, greater name recognition, financial, technical, marketing, sales,
manufacturing, distribution and other resources and long standing relationships
with OEMs and other customers. These factors may place us at a disadvantage when
we respond to our competitors' pricing strategies, technological advances and
other initiatives. Specifically, we may not be able to compete successfully with
Johnson Controls in the markets where Johnson Controls has a royalty-bearing
license from us. Additionally, our competitors may develop services that are
superior to ours or that achieve greater market acceptance. Our inability to
successfully respond to competitive pressures would have a material adverse
effect on our business, operating results and financial condition.
FAILURE TO MANAGE OUR GROWTH EFFECTIVELY COULD ADVERSELY AFFECT OUR BUSINESS.
Our transition from a development stage company to a manufacturing
company has strained and will continue to strain our managerial, operational and
financial resources. If our products achieve market acceptance, we will need to
further increase our number of employees and enhance our operating systems and
practices. We must effectively manage our operational and financial systems,
procedures and controls to manage this future growth. Further, our transition
from a research and development focused entity to a manufacturing and customer
focused entity will require new processes and activities that we have not done
before.
A NUMBER OF FACTORS COULD CAUSE OUR OPERATING RESULTS TO FLUCTUATE SIGNIFICANTLY
AND OUR STOCK PRICE TO FALL.
We expect our annual and quarterly operating results to fluctuate
significantly in the future. It is possible that in some future periods our
results may be below expectations of public market analysts and investors. If
this occurs, the trading price of our common stock could significantly decline.
Our operating results may fluctuate in the future due to a variety of factors,
not all of which are in our control. These factors include:
o the size and timing of individual purchase orders;
o the long sales cycle in the OEM markets for our products;
o market acceptance of our products;
o implementation of additional automated production lines;
o manufacturing yields and efficiency;
o changes in our operating expenses;
10.
<PAGE> 12
o the mix of sales to OEMs and VAPs;
o product development programs; and
o general industry and economic conditions.
The success of our business depends on increasing revenues to offset
expenses. We cannot assure you that we will generate sufficient revenues to
offset our expenses. If our revenues are less than expected, or if we increase
our spending ahead of our revenue growth, our business, financial condition and
operating results will be materially and adversely affected. You should not rely
on annual or quarter-to-quarter comparisons of our operating results as an
indication of future performance.
WE ARE DEPENDENT ON OUR SUPPLIERS FOR RAW MATERIALS.
We are dependent on sole or limited source suppliers for certain key
raw materials used in our products, particularly thin lead foil, lead oxide,
molded components, separators, acid and expander components. We have qualified,
or we are in the process of qualifying, second sources for all primary product
components. We generally purchase sole or limited source raw materials pursuant
to purchase orders placed from time to time and we have no long-term contracts
or other guaranteed supply arrangements with our sole or limited source
suppliers. If our suppliers are unable to meet our quality and volume
requirements for raw materials in a timely manner and at an acceptable cost, it
could have a material adverse effect on our business, financial condition and
operating results.
OUR INABILITY TO PROTECT OUR INTELLECTUAL PROPERTY MAY ADVERSELY AFFECT OUR
ABILITY TO COMPETE.
Patents, trade secrets and other proprietary rights are important to
our success and competitive position. Our efforts to protect our proprietary
rights may be inadequate and may not prevent others from claiming violations by
us of their proprietary rights.
We hold seven issued United States patents which expire beginning in
2008 and ending in 2016. The Company also has four issued foreign patents. In
addition, we have ten patents pending in the United States, as well as a number
of foreign patents pending. Patent applications in the United States are
maintained in secrecy until patents issue, and since publication of discoveries
in the scientific or patent literature tends to lag behind actual discoveries,
we cannot be certain that we are the first creator of inventions covered by
pending patent applications or the first to file patent applications on such
inventions.
We cannot be certain that our pending applications will result in
issued patents or that foreign patent applications related to issued United
States patents will issue. Because the status of patents involves complex legal
and factual questions and the breadth of claims issued is uncertain, we cannot
be certain that any of our issued patents will afford meaningful protection
against competitors with similar technology. In addition, with respect to
foreign patents, some foreign countries provide significantly less patent
protection than the United States.
In addition to patent protection, we rely on the law of unfair
competition and trade secrets to protect our proprietary rights.
The unauthorized misappropriation of our proprietary rights could have
a material adverse effect on our business, financial condition and operating
results. Other companies may infringe upon our patents and other proprietary
rights or may obtain patents that will require us to license or design around
such patents. If we resort to legal proceedings to enforce our proprietary
rights, the proceedings could be burdensome and expensive and the outcome could
be uncertain. To determine the priority of inventions, we may have to
participate in interference proceedings declared by the United States Patent and
Trademark Office or comparable proceedings in foreign patent offices, which
could result in substantial cost and may result in an adverse decision as to the
priority of our inventions.
11.
<PAGE> 13
WE ARE SUBJECT TO CLAIMS ALLEGING INTELLECTUAL PROPERTY INFRINGEMENT.
We may be subject to claims alleging that we have infringed third party
proprietary rights. If we were to discover that any of our products infringed
third party rights, we may not be able to obtain permission to use those rights
on commercially reasonable terms. If we resort to legal proceedings to enforce
our proprietary rights or defend against alleged infringements, the proceedings
could be burdensome and expensive and could involve a high degree of risk. Any
of these events could have a material adverse effect on our business, operating
results and financial condition.
WE MAY NOT BE ABLE TO SUCCESSFULLY OPERATE OUR BUSINESS IF WE LOSE KEY
PERSONNEL.
We believe that our success will depend on the continued services of
our senior management team and other key personnel. The loss of the services of
any of our senior management team or other key employees could materially
adversely affect our business, operating results and financial condition. In
addition, we rely on consultants and advisors to assist us in formulating our
research and development strategy. We do not have fixed term employment
contracts with any of our key executives. We maintain key person life insurance
on Mr. Lankford, Sandra D. Schreiber, our Senior Vice President--Systems and
Supply Chain, and Arthur S. Homa, our Senior Vice President--Technology and
Manufacturing.
OUR BUSINESS WILL SUFFER IF WE DO NOT ATTRACT AND RETAIN HIGHLY SKILLED
PERSONNEL.
In order to continue to pursue our product development and marketing
plans, our future success depends on our ability to identify, attract, hire and
train highly skilled scientific, manufacturing and sales and marketing
personnel. These requirements are also expected to demand the addition of
management personnel and the development of additional expertise by existing
management personnel. Our failure to attract and retain the necessary
scientific, manufacturing and sales and marketing personnel could materially
adversely affect our business, operating results and financial condition,
including our ability to conclude collaborations with additional corporate
partners.
OUR INABILITY TO COMPLY WITH ENVIRONMENTAL REGULATIONS MAY ADVERSELY AFFECT OUR
BUSINESS.
Our operations involve the storage, use and disposal of a number of
toxic and hazardous materials, including lead, lead oxide, sulfuric acid,
solvents and adhesives. As a result, we are required to maintain our research
and manufacturing operations in compliance with United States federal, state and
local laws and regulations, including but not limited to the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, that govern the
storage, use and disposal of various chemicals used in and waste materials
produced by the manufacture of our TMF batteries.
For example, our manufacturing facilities each include an enclosed area
specifically designed for the mixing of lead oxide paste, the pasting of the
lead foil and the winding of the cells. Employees operating in these areas are
instructed in the use of safety equipment such as gloves, protective clothing
and respirators and are required under Occupational Safety and Health
Administration guidelines to submit to blood monitoring tests on a periodic
basis which are undertaken by an outside, independent agency.
We may be unable to operate in conformity with such laws and
regulations in the future. Additionally, changes in such regulations may require
us to incur substantial capital or operating costs to achieve or maintain
compliance. Any failure by us to adequately control the discharge of our
hazardous materials and wastes could also subject us to future liabilities,
which could be significant.
OUR BUSINESS COULD BE AFFECTED BY YEAR 2000 ISSUES.
Year 2000 issues refer generally to the problems that some software may
have in determining the correct century for the year. For example, software with
date-sensitive functions that is not Year 2000 compliant may not be able to
distinguish whether "00" means 1900 or 2000, which may result in failures or the
creation of erroneous results.
12.
<PAGE> 14
We rely upon software in our information systems and manufacturing
equipment. We have completed an inventory of our critical control systems,
computers, and application software. We plan on validating each of these systems
by September 30, 1999 through a combination of written vendor confirmations and
specific validation testing. We have contracted with third party vendors to
assist in planning tests and/or testing these systems.
We are not currently aware of any significant operational issues or
costs associated with preparing our internal information technology and
non-information technology systems for the Year 2000. However, we may experience
significant unanticipated problems and costs caused by undetected errors or
defects in the technology used in our internal information technology and
non-information technology systems.
We have funded our Year 2000 plan from cash balances and have not
separately budgeted for these costs in the past. To date, these costs have not
been significant. We will, however, incur additional costs related to the Year
2000 plan. In addition, we may experience material problems and costs with Year
2000 compliance that could seriously harm our business, financial condition and
results of operations.
We have not yet fully developed a contingency plan to address
situations that may result if we are unable to achieve Year 2000 readiness of
our critical operations. The cost of developing and implementing such a plan may
itself be significant. Finally, we are also subject to external forces that
might generally affect industry and commerce, such as utility or transportation
company interruptions caused by Year 2000 compliance failures.
We believe that our most likely risks from Year 2000 issues are
external, due to the difficulty of validating key third parties' readiness for
Year 2000. Even if we obtain Year 2000 compliance assurances from third parties,
there is still a risk that a major supplier of raw materials, or a major OEM
customer, could become unreliable due to Year 2000 problems.
OUR PRODUCT LIABILITY INSURANCE MAY NOT BE SUFFICIENT TO COVER PRODUCT LIABILITY
CLAIMS.
Lead acid batteries, including our TMF battery, may develop significant
internal pressures during severe overcharge conditions due to the release of
gases as a byproduct of the chemical reaction occurring in the cell. In order to
prevent potential pressure build up, our batteries incorporate a Bunsen pressure
relief valve which, under normal overcharge conditions, will allow the venting
of small amounts of gases, primarily hydrogen and oxygen. If the batteries are
subjected to abusive overcharge or overdischarge conditions, larger amounts of
these gases may be vented, which, when mixed with air, can cause explosions. In
addition, under such conditions, toxic gases and/or sulfuric acid spray may be
released. Sulfuric acid can cause burns. Such occurrences may result in product
liability claims against us.
Additionally, we intend to manufacture and retail end user products to
consumers, such as an emergency automotive jump start product. The sale of such
products may expose us to product liability claims from consumers.
Although we maintain product liability insurance in amounts which we
believe are reasonable given the associated risks, we cannot be certain that
such insurance will be adequate to cover any potential liability relating to one
or more claims of product liability, or that such insurance will be available at
an acceptable cost in the future.
CONTROL BY EXISTING STOCKHOLDERS MAY LIMIT YOUR ABILITY TO INFLUENCE THE OUTCOME
OF DIRECTOR ELECTIONS AND OTHER MATTERS REQUIRING STOCKHOLDER APPROVAL.
Approximately 38% of our outstanding stock is owned by two venture
capital funds. These stockholders may be able to significantly influence matters
that we require our stockholders to approve, including electing directors and
approving significant corporate transactions. This concentration of ownership
may also have the effect of delaying or preventing a change in control of us,
which could result in a lower stock price.
CERTAIN PROVISIONS IN OUR CORPORATE DOCUMENTS MAY DISCOURAGE OUR ACQUISITION BY
OTHERS AND THUS DEPRESS OUR STOCK PRICE.
Our corporate documents and Delaware law could make it more difficult
for a third party to acquire us, even if a change in control would be beneficial
to our stockholders. In particular, we adopted a stockholder rights
13.
<PAGE> 15
plan in 1998. These and other provisions might discourage, delay or prevent a
change in control of us or a change in our management. These provisions could
also limit the price that investors might be willing to pay in the future for
shares of common stock.
THE PRICE FOR OUR COMMON STOCK IS LIKELY TO BE HIGHLY VOLATILE, AND YOU MAY NOT
BE ABLE TO RESELL SHARES AT OR ABOVE THE OFFERING PRICE.
The market price of our common stock has been and is likely to be
highly volatile as the stock market in general, and the market for technology
companies in particular, has been highly volatile. Investors may not be able to
resell their shares of our common stock following periods of volatility because
the market reacts adversely to volatility.
Factors that could cause volatility in our stock price may include,
among other things:
o actual or anticipated variations in our quarterly operating results;
o if we or our competitors announce technological innovations or new
commercial products;
o changes in governmental regulation;
o developments in our patents or other proprietary rights or those of
our competitors, including litigation;
o developments in our relationships with current or future
collaborative partners;
o if securities analysts change their financial estimates for us or
for our competitors;
o general conditions or trends in the stock market;
o if we add or lose key personnel; and
o if our stockholders sell common stock.
Many of these factors are beyond our control. These factors may
materially adversely affect the market price of our common stock, regardless of
our operating performance.
FUTURE SALES OF OUR COMMON STOCK IN THE PUBLIC MARKET COULD CAUSE OUR STOCK
PRICE TO FALL AND DECREASE THE VALUE OF YOUR INVESTMENT.
The market price of our common stock could fall if our stockholders
sell substantial amounts of common stock, including shares issued upon the
exercise of outstanding options and warrants and upon conversion of the
outstanding Series A Preferred Stock, in the public market following this
offering. Such sales might also make it more difficult for us to sell equity
securities in the future at a time and price that we deem appropriate.
Some stock and warrant holders are entitled to certain registration
rights. The exercise of such rights could adversely affect the market price of
our common stock.
USE OF PROCEEDS
BOLDER Technologies Corporation will not receive any proceeds from the
sale of common stock by the selling stockholders.
14.
<PAGE> 16
SELLING STOCKHOLDERS
The following table sets forth the names of the selling stockholders,
the number of shares of common stock owned by each of them as of the date of
this Prospectus and the number of shares of common stock which may be offered
pursuant to this Prospectus. The selling stockholders may offer all, some or
none of their shares of common stock.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED SHARES BEING SHARES BENEFICIALLY OWNED AFTER
NAME PRIOR TO OFFERING(1)(2) OFFERED OFFERING (2)
- ---- ------------------------- ------------ -------------------------------
NUMBER PERCENT NUMBER PERCENT
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
Entities associated with
Special Situations Private
Equity Fund, L.P. (3) -- -- 416,667 -- --
Lancaster Investment
Partners -- -- 200,000 -- --
Watson Investment
Partners, L.P. -- -- 50,000 -- --
Harbour Investments Ltd. -- -- 41,667 -- --
Robert G. Allison -- -- 4,250 -- --
Gary Bergren -- -- 4,250 -- --
Craig L. Campbell -- -- 4,250 -- --
Dennis D. Gonyea -- -- 4,250 -- --
James G. Peters IRA -- -- 4,000 -- --
Daniel S. Perkins IRA -- -- 4,000 -- --
Daniel S. Perkins TTEE
U/A Dated
5-12-88 -- -- 4,000 -- --
Patrice M. Perkins IRA -- -- 3,000 -- --
Patrice M. Perkins TTEE
U/A Dated
5-12-88 -- -- 4,000 -- --
David H. Potter IRA -- -- 4,000 -- --
Pyramid Partners, L.P. -- -- 50,000 -- --
Ellis Limited Partnership -- -- 10,000 -- --
Harold Roitenberg IRA -- -- 10,000 -- --
John F. Rooney -- -- 5,000 -- --
Donald M. Liddell 15,000 * 50,000 15,000 *
Jane H. Liddell -- -- 50,000 -- --
D. Roger B. Liddell 7,275 * 12,500 7,275 *
Trust under the will of
Edith S. Liddell 16,800 * 36,800 16,800 *
Florence W. Liddell 1,500 * 12,500 1,500 *
Torrey B. Liddell 8,500 * 12,500 8,500 *
</TABLE>
15.
<PAGE> 17
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED SHARES BEING SHARES BENEFICIALLY OWNED AFTER
NAME PRIOR TO OFFERING(1)(2) OFFERED OFFERING (2)
- ---- ------------------------- ------------ -------------------------------
NUMBER PERCENT NUMBER PERCENT
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
Alice E.E. Liddell Trust
dated 8-12-97 7,500 * 15,000 7,500 *
Catherine H. Bass 5,500 * 12,000 5,500 *
Margot S. Bass 6,500 * 15,000 6,500 *
Steedman L. Bass 6,500 * 15,000 6,500 *
Jane L. Bass 2,000 * 12,500 2,000 *
Roscoe C. Ingalls, Jr. -- -- 8,500 -- --
Sylvia Keiser 1,600 * 33,500 1,600 *
Marjorie Ann Berger 4,000 * 10,000 4,000 *
John M. Armstrong 2,000 * 12,500 2,000 *
Ann M. Goodbody 5,000 * 20,000 5,000 *
John R. Twiss, Jr. 1,500 * 25,000 1,500 *
Mary Twiss -- -- 8,500 -- --
Richard N. Pierson III 1,800 * 8,500 1,800 *
Stephen F. Wilder 7,000 * 17,000 7,000 *
Albert C. England, Jr. 5,000 * 17,000 5,000 *
Ernst R. Habicht, Jr. 2,500 * 12,500 2,500 *
Michael J. Davies 2,000 * 8,500 2,000 *
Donald B. Brant, Jr. 4,000 * 6,000 4,000 *
Dan I. Abrams -- -- 10,000 -- --
John C. Beck -- -- 8,500 -- --
M. Gerald Sedam -- -- 8,500 -- --
John G. Kinnard & Co.,
Inc. (4) -- -- 8,333 -- --
Argosy Capital Group, L.P. -- -- 100,000 -- --
Stephen C. Marcus -- -- 15,000 -- --
EDJ Limited -- -- 50,000 -- --
Frorer Partners, L.P. -- -- 100,000 -- --
Losty Capital Management -- -- 30,000 -- --
VFT Special Ventures, Ltd. -- -- 75,000 -- --
Porter Partners, L.P. -- -- 100,000 -- --
TCMP 3 Partners, L.P. -- -- 30,000 -- --
Edward O. Thorp -- -- 50,000 -- --
Jeffrey Thorp IRA Rollover, -- -- 60,000 -- --
Bear Stearns SECS Corp
Custodian
George H. Dorion -- -- 7,500 -- --
Archimedes Overseas Ltd. -- -- 30,000 -- --
Stephen H. Paneyko -- -- 10,000 -- --
Florence K. Romanov -- -- 7,500 -- --
William N. Breger -- -- 7,500 -- --
New York School of Interior -- -- 28,572 -- --
Design
Lawton Lamb -- -- 7,500 -- --
Nathaniel P. Phillips, Jr. -- -- 15,000 -- --
William Reed Simmons -- -- 10,000 -- --
Kathie Plourde Simmons -- -- 7,500 -- --
Carole Maeder -- -- 7,500 -- --
Lew Walter -- -- 7,500 -- --
Stephen M. Pulsifer -- -- 7,143 -- --
</TABLE>
- ----------------
* Less than 1%.
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. Shares of common stock
issuable upon exercise of options currently exercisable, or exercisable
within 60 days of the date of this Prospectus, are deemed outstanding for
computing the percentage of the person holding such securities but are not
outstanding for computing the percentage of any other person. Subject to
community property laws where applicable, the persons named in the above
table have sole voting and investment power with respect to all shares of
common stock shown as beneficially owned by them.
(2) Although the selling stockholders have not expressed a specific intention
as to the number of shares of common stock to be sold, the table shows the
beneficial ownership that would result if all shares being offered hereby
were sold. Percentage calculations are based upon 11,005,127 shares of
common stock outstanding as of June 30, 1999.
(3) Includes 150,000 shares of common stock held by Special Situations Private
Equity Fund, L.P., 150,000 shares of common stock held by Special
Situations Fund III, L.P., 51,667 shares of common stock held by Special
Situations Cayman Fund, L.P. and 65,000 shares of common stock held by
Special Situations Technology Fund, L.P.
(4) During the three year period prior to the date of this registration
statement, John G. Kinnard & Co., Inc. has acted as a market maker with
respect to the Company's common stock. In addition, John G. Kinnard & Co.,
Inc. acted as the Company's financial advisor in connection with the
private placement of the Shares of common stock to the selling
stockholders.
16.
<PAGE> 18
PLAN OF DISTRIBUTION
The Company is registering the shares of common stock (the "Shares")
offered by the selling stockholders hereunder pursuant to covenants and
contractual registration rights contained in the Common Stock Purchase
Agreements, by and between the Company and the selling stockholders, dated as of
May 14, 1999, May 18, 1999 and July 9, 1999 (collectively, the "Purchase
Agreements"), and the Registration Rights Agreements, by and between the Company
and the selling stockholders, dated as of May 14, 1999, May 18, 1999 and July 9,
1999 (collectively, the "Registration Rights Agreements"). As used herein,
"selling stockholders" includes pledgees, donees and transferees selling shares
received from a named selling shareholder after the date of this Prospectus. All
costs, expenses and fees in connection with the registration of the Shares
offered hereby will be borne by the Company. Brokerage commissions and similar
selling expenses, if any, attributable to the sale of Shares will be borne by
the selling shareholders.
Sales of Shares may be effected by selling shareholders from time to
time in one or more types of transactions (which may involve one or more blocked
transactions) on The NASDAQ National Market, in privately negotiated
transactions, through put or call options transactions, through short sales of
Shares, or a combination of such methods of sale, at market prices prevailing at
the time of sale or at negotiated prices. Such transactions may or may not
involve brokers or dealers.
The selling stockholders may effect such transactions by selling the
Shares to or through broker-dealers, which may act as agents or principals. Such
broker-dealers may receive compensation in the form of discounts, concession or
commissions from the selling stockholders and/or the purchasers of the Shares
for whom such broker-dealers may act as agent or to whom they sell as principal,
or both (which compensation to a particular broker-dealer might be in excess of
customary commission).
At any time a particular offer of Shares is made, the specific Shares
of common stock to be sold, the names of the selling stockholders, the
respective purchase prices and public offering prices, the names of any agent,
dealer or underwriter, and any applicable commissions or discounts with respect
to a particular offer will be set forth in an accompanying Prospectus supplement
or, if appropriate, a post-effective amendment to the registration statement of
which this Prospectus is a part.
The selling stockholders and any broker-dealers who act in connection
with the sale of Shares hereunder may be deemed to be "underwriters" as that
term is defined in the Securities Act of 1933 (the "Securities Act"), and any
commissions received by them and profit on any resale of the Shares as principal
might be deemed to be underwriting discounts and commissions under the
Securities Act.
Any or all of the sales or other transactions involving the Shares
described above, whether effected by the selling stockholders, any broker-dealer
or others, may be made pursuant to this Prospectus. In addition, any Shares that
qualify for sale pursuant to Rule 144 under the Act may be sold under Rule 144
rather than pursuant to this Prospectus.
In order to comply with the securities laws of certain states, if
applicable, the Shares may be sold in such jurisdictions only through registered
or licensed brokers or dealers. In addition, in certain states the Shares may
not be sold unless they have been registered or qualified for sale or an
exemption from registration or qualification requirements is available and is
complied with.
Pursuant to the terms of the Registration Rights Agreements, the
Company has agreed to use its best efforts to cause the registration statement
to which this Prospectus related to become effective by August 16, 1999 for the
resale of the Shares and to remain effective until the earlier of the expiration
of the Effectiveness Target Date (as defined in the Registration Rights
Agreements, copies of which are attached as exhibits hereto) or the date a
Subsequent Shelf Registration (as defined in the Registration Rights Agreements)
covering all of the Shares of common stock has been declared effective under the
Securities Act. The Company will be permitted to suspend the use of the
Prospectus which is a part of such registration statement during certain periods
of time and under certain circumstances relating to pending corporate
developments, public filings with the Commission and similar events. The Company
will pay all expenses of such registration statement, provide to each registered
holder
17.
<PAGE> 19
requesting to sell the Shares copies of such Prospectus, notify each registered
holder when such registration statement has become effective and take certain
other actions as are required to permit, subject to the foregoing, unrestricted
resales of such securities. A holder who sells such securities pursuant to such
registration statement generally will be required to be named as a selling
stockholder in the related Prospectus and to deliver a Prospectus to purchasers
and will be bound by the provisions of the Registration Rights Agreements which
are applicable to such holder (including certain indemnification provisions). If
a registration statement covering the Shares is not effective, such Shares may
not be sold or otherwise transferred except in accordance with the provisions
set forth under an exemption from registration under federal and state
securities laws. The Registration Rights Agreements provide for
cross-indemnification of the selling stockholders and the Company to the extent
permitted by law, for losses, claims, damages, liabilities and expenses arising
under certain circumstances, out of any registration of the Shares.
DESCRIPTION OF CAPITAL STOCK
The Company's authorized capital stock consists of 25,000,000 shares of
common stock, $.001 par value per share, and 5,000,000 shares of preferred
stock, $.001 par value per share, of which 336,200 are designated Series A
Preferred Stock and 250,000 are designated Series B Junior Participating
Preferred Stock. As of June 22, 1999, there were approximately 280 record
holders of the Company's common stock.
COMMON STOCK
The holders of the Company's common stock are entitled to one vote for
each share held of record on all matters submitted to a vote of the
stockholders. The holders of common stock are not entitled to cumulative voting
rights with respect to the election of directors, and as a consequence, minority
stockholders will not be able to elect directors on the basis of their votes
alone. Subject to preferences that may be applicable to any then outstanding
shares of preferred stock, holders of common stock are entitled to receive
ratably such dividends as may be declared by the Board of Directors out of funds
legally available therefor. In the event of a liquidation, dissolution or
winding up of the Company, holders of the common stock are entitled to share
ratably in all assets remaining after payment of liabilities and the liquidation
preference of any then outstanding preferred stock. Holders of common stock have
no preemptive rights and no right to convert their common stock into any other
securities. There are no redemption or sinking fund provisions applicable to the
common stock. All outstanding shares of common stock are, and all shares of
common stock to be outstanding upon completion of this offering will be, fully
paid and nonassessable.
SHAREHOLDER RIGHTS PLAN
Each share of common stock has associated with it one right (a "Right")
to purchase one one-hundredth of a share of Series B Junior Participating
Preferred Stock (or in certain cases other securities) of the Company. The terms
of the Rights are set forth in a Rights Agreement (the "Rights Agreement") dated
as of January 23, 1998, between the Company and American Stock Transfer & Trust
Company, as Rights Agent. Prior to the occurrence of certain specified future
events, the rights will not be represented by separate certificates and will be
transferable with and only with the associated common stock.
Pursuant to the Rights Agreement, in the event that, among other
things, a third party acquires beneficial ownership of 15% or more of the
outstanding shares of the common stock, each holder of Rights will be entitled
to purchase securities of the Company having a market value equal to twice the
purchase price thereof. In addition, Rights held by an Acquiring Person (as
defined in the Rights Agreement) will become null and void, nontransferable and
nonexercisable.
Subject to certain limitations, the Company may redeem the Rights in
whole, but not in part, at a price of $.01 per Right. The Rights will expire on
January 23, 2008, unless earlier redeemed by the Company.
The Company's Shareholder Rights Plan may have the effect of
discouraging unsolicited takeover attempts.
18.
<PAGE> 20
The foregoing summary of certain terms of the Rights does not purport
to be complete and is subject to, and is qualified in its entirety by reference
to, the Rights Agreement, a copy of which is on file with the Commission.
PREFERRED STOCK
The Board of Directors of the Company is empowered, without approval of
the stockholders, to cause shares of preferred stock to be issued in one or more
series and to establish the number of shares to be included in each such series
and the rights, powers, preferences and limitations of each series. Because the
Board of Directors has the power to establish the preferences and rights of each
series, it may afford the holders of any series of preferred stock preferences,
powers and rights, voting or otherwise, senior to the rights of holders of
common stock or other series of preferred stock. The issuance of the preferred
stock could have the effect of delaying or preventing a change in control of the
Company. The Board of Directors has no present plans to issue any of the
preferred stock, other than the Series A Preferred Stock which was issued by the
Company in October 1997. In connection with the Company's Shareholder Rights
Plan, the Company would be obligated to issue shares of Series B Junior
Participating Preferred Stock if such rights become exercisable.
The Series A Preferred Stock constitutes a single series of the
preferred stock of the Company consisting of 336,200 shares. All outstanding
shares of Series A Preferred Stock are duly authorized, validly issued, fully
paid and nonassessable, and the holders thereof will not have any preemptive
rights in connection therewith. The Series A Preferred Stock is not subject to
any sinking fund or other obligation of the Company to redeem or retire such
shares except as described below. Any Series A Preferred Stock converted,
redeemed or otherwise acquired by the Company will, upon cancellation of such
shares, have the status of authorized but unissued preferred stock subject to
issuance by the Board of Directors as shares of preferred stock of any one or
more other series but not as shares of Series A Preferred Stock.
The material rights, powers, preferences and limitations of the Series
A Preferred Stock are set forth below:
o Dividends. Holders of the Series A Preferred Stock are each
entitled to receive (and the Company is required to pay), when, as
and if declared by the Board of Directors, out of the funds of the
Company legally available therefor, a semi-annual dividend payable
in common stock (based upon the common stock's then fair market
value) or cash or a combination of common stock and cash, at the
Company's option, at an annual rate equal to (i) $4.00 per share to
the extent the dividend is paid in cash and (ii) $4.50 per share to
the extent the dividend is paid in common stock. If dividends are
paid in cash it could require the Company to pay $1,344,000
annually. If dividends are paid in common stock it will be dilutive
to the holders of common stock.
o Conversion Rights. Each share of Series A Preferred Stock is
convertible at the option of the holder thereof at any time, unless
previously redeemed, into that number of shares of common stock
equal to $50.00 divided by a conversion price per share equal to
$15.00, subject to certain adjustments.
o Liquidation Rights. In the event of any liquidation, dissolution or
winding up of the Company, whether voluntary or involuntary, the
holders of shares of Series A Preferred Stock are each entitled to
receive out of assets of the Company available for distribution to
stockholders, whether from capital surplus or earnings, before any
distribution of assets is made to holders of common stock and of any
other class of stock of the Company ranking junior to the Series A
Preferred Stock, liquidating distributions equal to the greater of
(i) $50.00 per share of such Series A Preferred Stock or (ii) the
amount per share of such Series A Preferred Stock that would have
been payable had each such share been converted into common stock
immediately prior to such event of liquidation, dissolution or
winding up, plus, in either case, accrued and unpaid dividends.
o Redemption Rights. Under certain circumstances, the shares of
Series A Preferred Stock are redeemable at the option of the
Company, in whole or in part, at any time or from time to time out
of funds legally available therefor, at $50.00 per share, plus in
each case an amount equal to accrued and unpaid dividends, if any,
to (and including) the redemption date, whether or not earned or
declared (the "Redemption Price"). The Redemption Price may be paid
in shares of common stock or cash, or in a
19.
<PAGE> 21
combination of common stock and cash, at the Company's option.
o Redemption at Option of Holder upon a Fundamental Change. If a
Fundamental Change (as defined in the Certificate of Designation of
the Series A Preferred Stock, a copy of which has previously been
filed with the Commission (the "Certificate of Designation"))
occurs, each holder of Series A Preferred Stock shall have the
right, at the holder's option, to require the Company to redeem all
of such holder's Series A Preferred Stock, or any portion thereof
that has an aggregate liquidation value that is a multiple of
$50.00, on the date selected by the Company that is not less than 10
nor more than 20 days after the Final Surrender Date (as defined in
the Series A Certificate of Designation), at a price per share equal
to the Redemption Price. The Company may, at its option, pay all or
any portion of the Redemption Price upon a Fundamental Change in
shares of common stock of the Company or any successor corporation.
o Voting Rights. The holders of Series A Preferred Stock have voting
rights on all matters subject to a vote of holders of common stock
on an as-converted basis. If the Series A Preferred Stock has not
been redeemed prior to October 8, 2003, the Board of Directors of
the Company shall be increased and the holders of Series A Preferred
Stock that have not been so redeemed shall be entitled, voting as a
separate class, to elect additional directors to the Board of
Directors of the Company so that the number of additional directors
to be elected by the Series A Preferred Stock shall constitute not
less than 20% (rounded to the nearest whole number) of the total
number of directors after giving effect to such increase. Such right
shall exist until the Series A Preferred Stock is redeemed.
OUTSTANDING REGISTRATION RIGHTS
Pursuant to an existing agreement between the Company and certain of
its stockholders, the holders (or their permitted transferees) of approximately
5,091,625 shares of common stock and 49,766 shares of common stock issuable upon
the exercise of warrants to purchase common stock (the "Holders") are entitled
to certain rights with respect to the registration of such shares under the
Securities Act. If the Company proposes to register any of its securities under
the Securities Act, either for its own account or for the account of other
security holders, the Holders are entitled to notice of the registration and are
entitled to include, at the Company's expense, such shares therein, provided,
among other conditions, that the underwriters have the right to limit the number
of such shares included in the registration. In addition, certain of the Holders
may require the Company, on not more than two occasions, to file a registration
statement under the Securities Act, at the Company's expense, with respect to
their shares of common stock, and the Company is required to use its best
efforts to effect the registration, subject to certain conditions and
limitations. However, the Holders may not require the Company to file any such
registration statement within 90 days of the effective date of any prior
registration statement covering the Company's common stock, and the Company may
defer the filing of such registration statement for up to 120 days. Further,
certain of the Holders may require the Company, at its expense, to register
their shares of common stock on a Form S-3, subject to certain conditions and
limitations.
DELAWARE ANTI-TAKEOVER LAW AND CHARTER PROVISIONS
The Company is subject to the provisions of Section 203 of the Delaware
General Corporation Law ("Delaware Law"), an anti-takeover law. In general, the
statute prohibits a publicly held Delaware corporation from engaging in a
"business combination" with an "interested stockholder" for a period of three
years after the date of the transaction in which the person became an interested
stockholder, unless the business combination is approved in a prescribed manner.
For purposes of Section 203, a "business combination" includes a merger, asset
sale or other transaction resulting in a financial benefit to the interested
stockholder, and an "interested stockholder" is a person who, together with
affiliates and associates, owns (or within three years prior, did own) 15% or
more of the corporation's voting stock.
The Company's Certificate of Incorporation (the "Certificate of
Incorporation") also requires that any action required or permitted to be taken
by stockholders of the Company must be effected at a duly called annual or
special meeting of the stockholders and may not be effected by a consent in
writing; provided, however, that the holders of Series A Preferred Stock may,
until such time as the Series A Preferred Stock is registered pursuant to any
effective registration statement under Section 12 of the Securities Exchange Act
of 1934, as amended, act
20.
<PAGE> 22
by written consent so long as such action by written consent is solely being
taken by, and is only applicable to, the holders of Series A Preferred Stock.
Special meetings of the stockholders of the Company may be called only by the
Board of Directors, the Chairman of the Board or the Chief Executive Officer.
The Certificate of Incorporation also provides that the authorized number of
Directors may be changed only by resolution of the Board of Directors, and that
Directors can only be removed for cause by a majority vote of the stockholders.
In addition, the Certificate of Incorporation provides for the classification of
the Board of Directors into three classes, only one of which shall be elected at
any given annual meeting. These provisions may have the effect of delaying,
deterring or preventing a change in control of the Company, depressing the
market price of common stock or discouraging hostile takeover bids in which
stockholders of the Company could receive a premium for their shares of common
stock.
LIMITATION ON DIRECTORS' LIABILITY
The Certificate of Incorporation limits the liability of the Company's
directors to the Company or its stockholders (in their capacity as directors but
not in their capacity as officers) to the fullest extent permitted by Delaware
law. Specifically, directors of the Company will not be personally liable for
monetary damages for breach of a director's fiduciary duty as a director, except
for liability (i) for any breach of the director's duty of loyalty to the
Company or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of the law, (iii)
for unlawful payments of dividends or unlawful stock repurchases or redemptions
as provided in Section 174 of the Delaware General Corporation Law or (iv) for
any transaction from which the director derived an improper personal benefit.
The inclusion of this provision in the Certificate of Incorporation may
have the effect of reducing the likelihood of derivative litigation against
directors and may discourage or deter stockholders or management from bringing a
lawsuit against directors for breach of their duty of care, even though such an
action, if successful, might otherwise have benefited the Company and its
stockholders.
TRANSFER AGENT AND REGISTRAR
American Stock Transfer & Trust Company acts as transfer agent and
registrar for the common stock and for the Series A Preferred Stock.
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be
passed upon for BOLDER Technologies Corporation by Cooley Godward LLP, Boulder,
Colorado.
EXPERTS
The financial statements of the Company incorporated by reference in
this Prospectus and elsewhere in the Registration Statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving said
reports.
21.
<PAGE> 23
NO DEALER, SALES PERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATION MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, ANY SECURITY
OTHER THAN THE NOTES OR CONVERSION SHARES OFFERED HEREBY, NOR DOES IT CONSTITUTE
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE NOTES OR
CONVERSION SHARES TO ANYONE IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM,
IT WOULD BE UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION. NEITHER THE DELIVERY
OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES,
CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE
COMPANY SINCE THE DATE HEREOF OR IMPLY THAT INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
2,053,182 SHARES
BOLDER TECHNOLOGIES CORPORATION
COMMON STOCK
--------------------
PROSPECTUS
--------------------
, 1999
<PAGE> 24
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth all expenses, other than the
underwriting discounts and commissions, payable by the Registrant in connection
with the sale of the common stock being registered. All the amounts shown are
estimates except for the registration fee.
<TABLE>
<S> <C>
Registration fee................................................ $3,205
Printing and engraving expenses................................. 5,000
Legal fees and expenses......................................... 30,000
Accounting Fees and Expenses.................................... 5,000
Miscellaneous................................................... 6,795
--------
Total........................................................ $ 50,000
</TABLE>
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
Under Section 145 of the Delaware General Corporation Law, the
Registrant has broad powers to indemnify its Directors and officers against
liabilities they may incur in such capacities, including liabilities under the
Securities Act.
The Registrant's Bylaws provide that the Registrant will indemnify its
directors and executive officers and may indemnify its other officers, employees
and agents to the fullest extent permitted by Delaware law. The Registrant is
also empowered under its Bylaws to enter into indemnification agreements with
its directors and officers and to purchase insurance on behalf of any person it
is required or permitted to indemnify.
In addition, the Registrant's Restated Certificate of Incorporation
provides that to the fullest extent permitted by Delaware law, the Registrant's
directors will not be liable for monetary damages for breach of the directors'
fiduciary duty of care to the Registrant and its stockholders. This provision in
the Restated Certificate of Incorporation does not eliminate the duty of care,
and in appropriate circumstances equitable remedies such as an injunction or
other forms of non-monetary relief would remain available under Delaware law.
Each director will continue to be subject to liability for breach of the
director's duty of loyalty to the Registrant, for acts or omissions not in good
faith or involving intentional misconduct, for knowing violations of law, for
any transaction from which the director derived an improper personal benefit,
for improper transactions between the director and the Registrant and for
improper distributions to stockholders and loans to directors and officers. This
provision also does not affect a director's responsibilities under any other
laws, such as the federal securities law or state or federal environmental laws.
The Registrant has entered into indemnification agreements with each of
its directors and officers under which the Registrant has indemnified each of
them against expenses and losses incurred for claims brought against them by
reason of their being a director or officer of the Registrant, and the
Registrant maintains directors' and officers' liability insurance.
There is no pending litigation or proceeding involving a director or
officer of the Registrant as to which indemnification is being sought, nor is
the Registrant aware of any pending or threatened litigation that may result in
claims for indemnification by any director or officer.
At present, there is no pending litigation or proceeding involving a
director or officer of the Registrant as to which indemnification is being
sought nor is the Registrant aware of any threatened litigation that may result
in claims for indemnification by any officer or director.
II-1
<PAGE> 25
The Registrant has an insurance policy covering the officers and
directors of the Registrant with respect to certain liabilities, including
liabilities arising under the Securities Act or otherwise.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
<S> <C>
4.1* Amended and Restated Certificate of Incorporation of the Registrant.
4.2** Certificate of Designation of the Series A Preferred Stock of the Registrant.
4.3** Amendment to Certificate of Designation of the Series A Preferred
Stock of Registrant.
4.4*** Certificate of Designation of the Series B Junior Participating Preferred Stock of the
Registrant.
4.5* Amended and Restated Bylaws of the Registrant.
4.6** Amendment to the Amended and Restated Bylaws of the Registrant.
4.7** Specimen stock certificate representing shares of Series
A Preferred Stock of the Registrant.
4.8* Specimen stock certificate representing shares of Common Stock of the Registrant.
4.9*** Rights Agreement between the Registrant and American
Stock Transfer & Trust Company, dated January 23, 1998.
4.10*** Form of Rights Certificate.
5.1 Opinion of Cooley Godward LLP.
10.1 Common Stock Purchase Agreement, dated May 14, 1999, between the Registrant and
certain of the selling stockholders.
10.2 Common Stock Purchase Agreement, dated May 18, 1999, between the Registrant and
certain of the selling stockholders.
10.3 Common Stock Purchase Agreement, dated July 9, 1999, between the Registrant and
certain of the selling stockholders.
10.4 Registration Rights Agreement, dated May 14, 1999, between the Registrant and certain
of the selling stockholders.
10.5 Registration Rights Agreement, dated May 18, 1999, between the Registrant and certain
of the selling stockholders.
10.6 Registration Rights Agreement, dated July 9, 1999, between the Registrant and certain
of the selling stockholders.
23.1 Consent of Arthur Anderson LLP.
23.2 Consent of Cooley Godward LLP (included in Exhibit 5.1).
24.1 Power of Attorney (see signature page hereto).
</TABLE>
----------------
* Previously filed as an exhibit to the Registrant's
Registration Statement on Form SB-2 (Registration
No. 333-2500-D) and incorporated herein by reference.
II-2
<PAGE> 26
** Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-3 (Registration
No. 333-41625) and incorporated herein by reference.
*** Previously filed as an exhibit to the Registrant's January 23,
1998 Form 8-K and incorporated herein by reference.
ITEM 17. UNDERTAKINGS.
(A) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(I) To include any prospectus required by
Section 10(a)(3) of the Securities Act;
(II) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement.
(III) To include any material information with
respect to the plan of distribution not previously disclosed
in the registration statement or any material change to such
information in the registration statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of
this section do not apply if the registration statement is on Form S-3,
Form S-8 or Form F-3, and the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed with or furnished to the Commission by the Registrant
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
(the "Exchange Act") that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To remove registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(B) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(C) The undersigned Registrant hereby undertakes to deliver or cause to
be delivered with the Prospectus, to each person to whom the Prospectus is sent
or given, the latest annual report to security holders that is incorporated by
reference in the Prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Exchange Act; and, where
interim financial information required to be presented by Article 3 of
Regulation S-X are not set forth in the prospectus, to deliver, or cause to be
delivered to each person to whom the Prospectus is sent or given, the latest
quarterly report that is specifically incorporated by reference in the
Prospectus to provide such interim financial information.
(D) Insofar as indemnification for liabilities under the Securities Act
of 1933 may be permitted to directors, officers, and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
II-3
<PAGE> 27
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriated jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
(E) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
II-4
<PAGE> 28
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Golden, State of Colorado, on July 9, 1999.
BOLDER Technologies Corporation
By /s/ Joseph F. Fojtasek
---------------------------------------
Joseph F. Fojtasek
Chief Financial Officer
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Daniel S. Lankford and Joseph F.
Fojatsek, his true and lawful attorney-in-fact and agent, each acting alone,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this registration statement, and to
sign any registration statement for the same offering covered by this
registration statement that is to be effective upon filing pursuant to Rule
462(b) and all post-effective amendments thereto, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent, full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his substitute, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Daniel S. Lankford Chief Executive Officer, Chairman of the Board July 9, 1999
- ------------------------------------ of Directors and Director (Principal Executive
Daniel S. Lankford Officer)
/s/ Joseph F. Fojtasek Chief Financial Officer and Vice President - July 9, 1999
- ------------------------------------ Finance and Administration, Treasurer
Joseph F. Fojtasek (Principal Financial Officer)
/s/ Wilmer R. Bottoms Director July 9, 1999
- ------------------------------------
Wilmer R. Bottoms
/s/ William D. Connor Director July 9, 1999
- ------------------------------------
William D. Connor
/s/ Donovan B. Hicks Director July 9, 1999
- ------------------------------------
Donovan B. Hicks
/s/ David L. Riegel Director July 9, 1999
- ------------------------------------
David L. Riegel
</TABLE>
II-5
<PAGE> 29
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Carl S. Stutts Director July 9, 1999
- ------------------------------------
Carl S. Stutts
/s/ Roger F. Warren Director July 9, 1999
- ------------------------------------
Roger F. Warren
</TABLE>
II-6
<PAGE> 30
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT PAGE
<S> <C> <C>
4.1* Amended and Restated Certificate of Incorporation of the Registrant. --
4.2** Certificate of Designation of the Series A Preferred Stock of the Registrant. --
4.3** Amendment to Certificate of Designation of the Series A Preferred Stock of Registrant. --
4.4*** Certificate of Designation of the Series B Junior Participating Preferred Stock of the
Registrant. --
4.5* Amended and Restated Bylaws of the Registrant. --
4.6** Amendment to the Amended and Restated Bylaws of the Registrant. --
4.7** Specimen stock certificate representing shares of Series A Preferred Stock of the
Registrant. --
4.8* Specimen stock certificate representing shares of Common Stock of the Registrant. --
4.9*** Rights Agreement between the Registrant and American Stock Transfer & Trust Company,
dated January 23, 1998. --
4.10*** Form of Rights Certificate. --
5.1 Opinion of Cooley Godward LLP. A-1
10.1 Common Stock Purchase Agreement, dated May 14, 1999, between the Registrant and certain
of the selling stockholders. B-1
10.2 Common Stock Purchase Agreement, dated May 18, 1999, between the Registrant and certain
of the selling stockholders. C-1
10.3 Common Stock Purchase Agreement, dated July 9, 1999, between the Registrant and
certain of the selling stockholders.
10.4 Registration Rights Agreement, dated May 14, 1999, between the Registrant and certain
of the selling stockholders. D-1
10.5 Registration Rights Agreement, dated May 18, 1999, between the Registrant and certain
of the selling stockholders. E-1
10.6 Registration Rights Agreement, dated July 9, 1999, between the Registrant and certain
of the selling stockholders.
23.1 Consent of Arthur Anderson LLP. F-1
23.2 Consent of Cooley Godward LLP (included in Exhibit 5.1). --
24.1 Power of Attorney (see signature page hereto). --
</TABLE>
----------------
* Previously filed as an exhibit to the Registrant's
Registration Statement on Form SB-2 (Registration
No. 333-2500-D) and incorporated herein by reference.
** Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-3 (Registration
No. 333-41625) and incorporated herein by reference.
*** Previously filed as an exhibit to the Registrant's January 23,
1998 Form 8-K and incorporated herein by reference
II-7
<PAGE> 1
EXHIBIT 5.1
[Letterhead of Cooley Godward LLP]
July 9, 1999
BOLDER Technologies Corporation
4403 Table Mountain Parkway
Golden, Colorado 80403
Ladies and Gentlemen:
You have requested our opinion with respect to certain matters in connection
with the filing by BOLDER Technologies Corporation (the "Company") of a
Registration Statement on Form S-3 (the "Registration Statement") with the
Securities and Exchange Commission covering the registration of up to 2,053,182
shares of the Company's Common Stock, $.01 par value (the "Shares") which are
owned by certain selling stockholders named in the Registration Statement (the
"Selling Shareholders").
In connection with this opinion, we have examined the Registration Statement and
related Prospectus, the Company's Certificate of Incorporation and Bylaws, as
amended to date, and such other documents, records, certificates, memoranda and
other instruments as we deem necessary as a basis for this opinion. We have
assumed the genuineness and authenticity of all documents submitted to us as
originals, the conformity to originals of all documents submitted to us as
copies thereof, and the due execution and delivery of all documents where due
execution and delivery are a prerequisite to the effectiveness thereof.
On the basis of the foregoing, and in reliance thereon, we are of the opinion
that the Shares are validly issued, fully paid and nonassessable.
We consent to the filing of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
Cooley Godward LLP
By: /s/ James H. Carroll
-----------------------------------
James H. Carroll
II-8
<PAGE> 1
EXHIBIT 10.1
BOLDER TECHNOLOGIES CORPORATION
COMMON STOCK
PURCHASE AGREEMENT
MAY 14, 1999
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
1. Agreement to Sell and Purchase...........................................................................1
1.1 Authorization of Shares.........................................................................1
1.2 Sale and Purchase...............................................................................1
2. Closing, Delivery and Payment............................................................................1
2.1 Closing.........................................................................................1
2.2 Delivery........................................................................................2
3. Representations and Warranties of the Company............................................................2
3.1 Organization, Good Standing and Qualification...................................................2
3.2 Capitalization..................................................................................2
3.3 Authorization; Binding Obligations..............................................................3
3.4 SEC Documents; Financial Statements.............................................................3
3.5 No Material Adverse Change......................................................................4
3.6 Liabilities.....................................................................................4
3.7 Title to Properties and Assets; Liens, Etc......................................................4
3.8 Intellectual Property...........................................................................4
3.9 No Conflicts....................................................................................4
3.10 No Consents.....................................................................................5
3.11 Litigation......................................................................................5
3.12 Offering Valid..................................................................................5
3.13 Compliance with Laws............................................................................5
3.14 Permits.........................................................................................5
4. Representations and Warranties of the Purchasers.........................................................5
4.1 Requisite Power and Authority...................................................................5
4.2 Investment Representations......................................................................6
(a) Purchaser Bears Economic Risk..........................................................6
(b) Acquisition for Own Account............................................................6
(c) Purchaser Can Protect Its Interest.....................................................6
(d) Accredited Investor....................................................................6
(e) Rule 144...............................................................................6
(f) Residence..............................................................................7
4.3 Transfer Restrictions...........................................................................7
</TABLE>
i.
<PAGE> 3
TABLE OF CONTENTS
(CONTINUED)
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
4.4 Legend..........................................................................................7
5. Conditions to Closing....................................................................................7
5.1 Conditions to Purchasers' Obligations at the Closing............................................7
(a) Representations and Warranties True; Performance of Obligations........................7
(b) Legal Investment.......................................................................7
(c) Consents, Permits, and Waivers.........................................................8
(d) Registration Rights Agreement..........................................................8
(e) Legal Opinion..........................................................................8
(f) Proceedings and Documents..............................................................8
5.2 Conditions to Obligations of the Company........................................................8
(a) Representations and Warranties True....................................................8
(b) Performance of Obligations.............................................................8
(c) Registration Rights Agreement..........................................................8
(d) Consents, Permits, and Waivers.........................................................8
6. Miscellaneous............................................................................................8
6.1 Governing Law...................................................................................8
6.2 Survival........................................................................................9
6.3 Successors and Assigns..........................................................................9
6.4 Entire Agreement................................................................................9
6.5 Severability....................................................................................9
6.6 Amendment and Waiver............................................................................9
6.7 Notices.........................................................................................9
6.8 Expenses.......................................................................................10
6.9 Attorneys' Fees................................................................................10
6.10 Titles and Subtitles...........................................................................10
6.11 Counterparts...................................................................................10
6.12 Broker's Fees..................................................................................10
6.13 Exculpation Among Purchasers...................................................................10
</TABLE>
ii.
<PAGE> 4
INDEX OF EXHIBITS
-----------------
Schedule of Purchasers Exhibit A
Amended and Restated Certificate
of Incorporation Exhibit B
Registration Rights Agreement Exhibit C
Opinion of Cooley Godward LLP Exhibit D
<PAGE> 5
BOLDER TECHNOLOGIES CORPORATION
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (the "AGREEMENT") is entered into
as of this 14th day of May, 1999, by and among BOLDER TECHNOLOGIES CORPORATION,
a Delaware corporation (the "COMPANY"), and each of those persons and entities,
severally and not jointly, whose names are set forth on the Schedule of
Purchasers attached hereto as Exhibit A (which persons and entities are
hereinafter collectively referred to as "PURCHASERS" and each individually as a
"PURCHASER").
RECITALS
WHEREAS, the Company has authorized the sale and issuance of an
aggregate of up to 1,500,000 shares of its Common Stock (the "SHARES");
WHEREAS, Purchasers desire to purchase the Shares on the terms and
conditions set forth herein; and
WHEREAS, the Company desires to issue and sell the Shares to Purchasers
on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual promises hereinafter set forth, the parties hereto agree as follows:
1. AGREEMENT TO SELL AND PURCHASE
1.1 AUTHORIZATION OF SHARES. On or prior to the Closing (as defined in
Section 2 below), the Company shall have authorized the sale and issuance to
Purchasers of the Shares. The Shares shall have the rights, preferences,
privileges and restrictions set forth in the Amended and Restated Certificate of
Incorporation of the Company, in the form attached hereto as Exhibit B (the
"RESTATED CERTIFICATE").
1.2 SALE AND PURCHASE. Subject to the terms and conditions hereof, at
the Closing (as hereinafter defined), the Company hereby agrees to issue and
sell to each Purchaser, severally and not jointly, and each Purchaser agrees to
purchase from the Company, severally and not jointly, the number of Shares set
forth opposite such Purchaser's name on Exhibit A at a purchase price of $6.00
per share.
2. CLOSING, DELIVERY AND PAYMENT
2.1 CLOSING. The closing of the sale and purchase of the Shares under
this Agreement (the "CLOSING") shall take place on the date hereof, at the
offices of Cooley Godward LLP, 2595 Canyon Boulevard, Suite 250, Boulder,
Colorado 80302 or at such other time or place as the Company and Purchasers may
mutually agree (such date is hereinafter referred to as the "CLOSING DATE").
1.
<PAGE> 6
2.2 DELIVERY. At the Closing, subject to the terms and conditions
hereof, the Company will deliver to the Purchasers certificates representing the
number of Shares to be purchased at the Closing by each Purchaser, against
payment of the purchase price therefor by wire transfer made payable to the
order of the Company.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
For purposes of this Agreement, "SEC DOCUMENTS" means, with respect to
any date or time referred to in this Agreement, all reports, registration
statements and definitive proxy statements filed by the Company (together with
any amendments required to be made with respect thereto) with the Securities and
Exchange Commission (the "COMMISSION") subsequent to December 1, 1997 and prior
to the date hereof, including all exhibits and schedules thereto and any
documents incorporated therein by reference. In addition, "RULES AND
REGULATIONS" means the rules and regulations adopted by the Commission under the
Securities Act of 1933, as amended (the "SECURITIES ACT") or the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), as applicable. All
references in this Agreement to financial statements and schedules and other
information which is "contained," "included," "stated," "described" or
"disclosed" in the SEC Documents (or other references of like import) shall be
deemed to mean and include all such financial statements and schedules and other
information which are incorporated in the SEC Documents.
Except as otherwise described or disclosed in the SEC Documents, the
Company (except where the context requires otherwise, for the purposes of this
Section 3, the "Company" shall mean the Company as well as its wholly-owned
subsidiaries) hereby represents and warrants to each Purchaser as follows:
3.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company has all requisite corporate power and
authority to own and operate its properties and assets, to execute and deliver
this Agreement and the Registration Rights Agreement, in the form attached
hereto as Exhibit C (the "REGISTRATION RIGHTS AGREEMENT"), to issue and sell the
Shares and to carry out the provisions of this Agreement, the Registration
Rights Agreement and the Restated Certificate and to carry on its business as
presently conducted and as presently proposed to be conducted. The Company is
duly qualified and licensed and in good standing as a foreign corporation in
each jurisdiction in which its ownership or leasing of any properties or the
character of its operations requires such qualification or licensing, except
where the failure to be so qualified or licensed would not have a material
adverse effect on the condition, financial or otherwise, results of operations
or business of the Company, taken as a whole (a "MATERIAL ADVERSE EFFECT"). The
Company has no subsidiaries, corporate or otherwise.
3.2 CAPITALIZATION. The authorized capital stock of the Company,
immediately prior to the Closing, will consist of (a) 25,000,000 shares of
Common Stock, of which 9,715,130 shares were issued and outstanding as of May 1,
1999, and of which 1,547,437 shares are reserved or will be reserved in the
future for issuance by the Company to key employees, consultants and others
affiliated with the Company pursuant to stock grant, stock purchase and/or
option plans or any other stock incentive program, arrangement or agreement
approved by the Company's Board of Directors, and (b) 5,000,000 shares of
Preferred Stock, of which 336,200
2.
<PAGE> 7
shares are designated Series A Convertible Preferred Stock, all of which are
issued and outstanding, and of which 250,000 shares are designated Series B
Junior Participating Preferred Stock, none of which are issued and outstanding.
All issued and outstanding shares of the Company's Common Stock and Preferred
Stock (i) have been duly authorized and validly issued, (ii) are fully paid and
nonassessable and (iii) were issued in compliance with all applicable state and
federal laws concerning the issuance of securities. The rights, preferences,
privileges and restrictions of the Shares are as stated in the Restated
Certificate. Except with respect to (i) the Company's Rights Agreement dated as
of January 23, 1998, (ii) the Company's outstanding shares of Series A
Convertible Preferred Stock, (iii) the Company's 1996 Employee Stock Purchase
Plan, (iv) the Company's 1996 Equity Incentive Plan, (v) warrants to purchase
Common Stock described in the SEC Documents, or (vi) as may be granted pursuant
to this Agreement, there are no outstanding options, warrants, rights (including
conversion or preemptive rights and rights of first refusal), proxy or
stockholder agreements, or agreements of any kind for the purchase or
acquisition from the Company of any of its securities. When issued in compliance
with the provisions of this Agreement and the Restated Certificate, the Shares
will be validly issued, fully paid and nonassessable and will be free of any
liens or encumbrances.
3.3 AUTHORIZATION; BINDING OBLIGATIONS. All corporate action on the
part of the Company, its officers, directors and stockholders necessary for the
authorization of this Agreement and the Registration Rights Agreement, the
performance of all obligations of the Company hereunder and thereunder at the
Closing and the authorization, sale, issuance and delivery of the Shares
pursuant hereto and pursuant to the Restated Certificate has been taken or will
be taken prior to the Closing. The Agreement and the Registration Rights
Agreement, when executed and delivered, will be valid and binding obligations of
the Company enforceable in accordance with their terms except (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws of
general application affecting enforcement of creditors' rights, (ii) general
principles of equity that restrict the availability of equitable remedies and
(iii) to the extent that the enforceability of the indemnification provisions of
the Registration Rights Agreement may be limited by applicable laws.
3.4 SEC DOCUMENTS; FINANCIAL STATEMENTS. As of their respective filing
dates, the SEC Documents complied in all material respects with the requirements
of the Securities Act, the Exchange Act and the Rules and Regulations. As of
their filing date, none of the SEC Documents contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, except to the extent
corrected by a document subsequently filed with the Commission. The SEC
Documents constitute all reports, registration statements, proxy statement and
other filings required to be made by the Company pursuant to the Securities Act
and the Exchange Act subsequent to December 1, 1997. All material contracts and
other documents of the Company required to be filed as exhibits to the SEC
Documents have been filed as required. The financial statements of the Company,
together with the related notes thereto, included in the SEC Documents comply as
to form in all material respects with the Rules and Regulations, have been
prepared in conformity with generally accepted accounting principles
consistently applied (except as may be indicated in the notes thereto) and
fairly present in all material respects the Company's financial position at the
dates thereof and the Company's results of operations, changes in stockholders'
equity and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal audit adjustments which will not be material in
amount or significance).
3.
<PAGE> 8
3.5 NO MATERIAL ADVERSE CHANGE. Since December 31, 1998, there has been
no material adverse change or development involving a prospective material
adverse change in the condition, financial or otherwise, results of operations
or business of the Company taken as a whole, whether or not arising in the
ordinary course of business. Since December 31, 1998, (i) there have been no
transactions entered into by the Company, other than those in the ordinary
course of business, which are material with respect to the Company, and (ii)
there has been no dividend or distribution of any kind declared, paid or made by
the Company on any class of its capital stock, other than regularly scheduled
dividend payments on the Company's outstanding Series A Convertible Preferred
Stock.
3.6 LIABILITIES. The Company does not have any liability or obligation
(whether accrued, absolute, contingent, matured, unmatured or other) which if
known would be required to be reflected in the Company's financial statements in
accordance with generally accepted accounting principles, except for any such
liability or obligation which (i) has been reflected in the Company's balance
sheet at December 31, 1998 or (ii) has arisen in the ordinary course of business
since December 31, 1998, consistent with past practices.
3.7 TITLE TO PROPERTIES AND ASSETS; LIENS, ETC. The Company has good
and marketable title to its properties and assets, and good title to its
leasehold interests, in each case subject to no mortgage, pledge, lien, lease,
encumbrance or charge.
3.8 INTELLECTUAL PROPERTY. The Company owns or possesses sufficient
legal rights to all patents, trademarks, service marks, trade names, copyrights,
trade secrets, information and other proprietary rights and processes necessary
for its business as now conducted and as proposed to be conducted. The Company
has not received any communications alleging that it has violated or, by
conducting its business as proposed would violate, any proprietary rights of any
other person, nor is the Company aware of any basis for the foregoing.
3.9 NO CONFLICTS. None of the Company's issue and sale of the Common
Stock, the execution or delivery of this Agreement and the Registration Rights
Agreement, its performance hereunder and thereunder, its consummation of the
transactions contemplated herein and therein conflicts or will conflict with or
results or will result in any breach or violation of any of the terms or
provisions of, or constitutes or will constitute a default under, or results or
will result in the creation or imposition of any lien, charge, claim,
encumbrance, pledge, security interest, defect or other restriction or equity of
any kind whatsoever upon any property or assets of the Company pursuant to the
terms of, (i) the Restated Certificate or by-laws of the Company, (ii) any
license, contract, indenture, mortgage, deed of trust, voting trust agreement,
stockholders' agreement, note, loan or credit agreement or other agreement or
instrument to which the Company is a party or by which it is or may be bound or
to which its properties or assets is or may be subject, or (iii) any statute,
judgment, decree, order, rule or regulation applicable to the Company of any
arbitrator, court, regulatory body or administrative agency or other
governmental agency or body, having jurisdiction over the Company or any of
their respective activities or properties except, in the case of clauses (ii)
and (iii), such defaults, impositions and violations that would not have a
Material Adverse Effect.
3.10 NO CONSENTS. No consent, approval, authorization or order of, and
no filing with, any court, arbitrator, regulatory body, government agency or
other body, domestic or foreign, is required for the execution, delivery or
performance of this Agreement, the Registration Rights
4.
<PAGE> 9
Agreement (execution and delivery only) or the transactions contemplated hereby
or thereby, except (i) the filing of a Form D with the Commission relating to
the sale of the Shares, (ii) such additional steps as may be required by the
Commission, and (iii) such additional steps as may be necessary to qualify the
Shares for sale by the Purchasers under state securities or Blue Sky laws.
3.11 LITIGATION. There is no action, suit, proceeding or investigation
pending or, to the Company's knowledge, currently threatened against the Company
which (i) questions the validity of the capital stock of the Company or of this
Agreement or the Registration Rights Agreement or of any action taken or to be
taken by the Company pursuant to or in connection with this Agreement or the
Registration Rights Agreement, or (ii) would be reasonably likely to result in a
Material Adverse Effect.
3.12 OFFERING VALID. Assuming the accuracy of the representations and
warranties of the Purchasers contained in Section 4.2 hereof, the offer, sale
and issuance of the Shares will be exempt from the registration requirements of
the Securities Act and will have been registered or qualified (or are exempt
from registration and qualification) under the registration, permit or
qualification requirements of all applicable state securities laws.
3.13 COMPLIANCE WITH LAWS. The Company's business has been conducted in
compliance with all applicable laws and regulations of governmental authorities,
except for such violations that have been cured or that, individually or in the
aggregate, would not be reasonably likely to result in a Material Adverse
Effect.
3.14 PERMITS. To the knowledge of the Company, the Company has all
franchises, permits, licenses and other authority necessary for its business as
now being conducted and believes it can obtain, without undue burden or expense,
any similar authority for its business as planned to be conducted. The Company
is not in default in any material respect under any such franchise, permit,
license or other authority.
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Each Purchaser hereby represents and warrants to the Company as follows
(such representations and warranties do not lessen or obviate the
representations and warranties of the Company set forth in this Agreement):
4.1 REQUISITE POWER AND AUTHORITY. Purchaser has all necessary power
and authority under all applicable provisions of law to execute and deliver this
Agreement and the Registration Rights Agreement and to carry out their
provisions. All action on Purchaser's part required for the lawful execution and
delivery of this Agreement and the Registration Rights Agreement have been or
will be effectively taken prior to the Closing. Upon their execution and
delivery, this Agreement and the Registration Rights Agreement will be valid and
binding obligations of Purchaser, enforceable in accordance with their terms,
except (i) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application affecting enforcement of
creditors' rights, (ii) general principles of equity that restrict the
availability of equitable remedies and (iii) to the extent that the
enforceability of the indemnification provisions of the Registration Rights
Agreement may be limited by applicable laws.
5.
<PAGE> 10
4.2 INVESTMENT REPRESENTATIONS. Purchaser understands that the Shares
have not been registered under the Securities Act. Purchaser also understands
that the Shares are being offered and sold pursuant to an exemption from
registration contained in the Securities Act based in part upon Purchaser's
representations contained in the Agreement. Purchaser hereby represents and
warrants as follows:
(A) PURCHASER BEARS ECONOMIC RISK. Purchaser has substantial
experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it is capable of
evaluating the merits and risks of its investment in the Company and has the
capacity to protect its own interests. Purchaser must bear the economic risk of
this investment indefinitely unless the Shares are registered pursuant to the
Securities Act, or an exemption from registration is available. Purchaser
understands that except as required by the Registration Rights Agreement, the
Company has no intention of registering the Shares. Purchaser also understands
that there is no assurance that any registration under the Registration Rights
Agreement or exemption from registration under the Securities Act will be
available and that, even if available, such registration or exemption may not
allow Purchaser to transfer all or any portion of the Shares under the
circumstances, in the amounts or at the times Purchaser might propose.
(B) ACQUISITION FOR OWN ACCOUNT. Purchaser is acquiring the Shares
for Purchaser's own account for investment only, and not with a view towards
their distribution.
(C) PURCHASER CAN PROTECT ITS INTEREST. Purchaser represents that
by reason of its, or of its management's, business or financial experience,
Purchaser has the capacity to protect its own interests in connection with the
transactions contemplated in this Agreement. Further, Purchaser is aware of no
publication of any advertisement in connection with the transactions
contemplated in the Agreement.
(D) ACCREDITED INVESTOR. Purchaser represents that it is an
accredited investor within the meaning of Regulation D under the Securities Act.
(E) RULE 144. Purchaser acknowledges and agrees that the Shares
must be held indefinitely unless they are subsequently registered under the
Securities Act or an exemption from such registration is available. Purchaser
has been advised or is aware of the provisions of Rule 144 promulgated under the
Securities Act, which permits limited resale of shares purchased in a private
placement subject to the satisfaction of certain conditions, including, among
other things, the availability of certain current public information about the
Company, the resale occurring following the required holding period under Rule
144 and the number of shares being sold during any three-month period not
exceeding specified limitations.
(F) RESIDENCE. If the Purchaser is an individual, then the
Purchaser resides in the state or province identified in the address of the
Purchaser set forth on Exhibit A; if the Purchaser is a partnership,
corporation, limited liability company or other entity, then the office or
offices of the Purchaser in which its investment decision was made is located at
the address or addresses of the Purchaser set forth on Exhibit A.
4.3 TRANSFER RESTRICTIONS. Each Purchaser agrees that Purchaser shall
in no event make any disposition of all or any portion of the Shares unless and
until (i) there is then in effect
6.
<PAGE> 11
a registration statement under the Securities Act covering such proposed
disposition and such disposition is made in accordance with said registration
statement; or (ii) (A) Purchaser shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed statement of
the circumstances surrounding the proposed disposition, (B) if requested by the
Company, Purchaser shall have furnished the Company with an opinion of
Purchaser's own counsel to the effect that such disposition will not require
registration of such Shares under the Securities Act and (C) such opinion of
Purchaser's counsel shall have been concurred in by counsel for the Company,
such concurrence not to be unreasonably withheld, and the Company shall have
advised Purchaser of such concurrence. Each Purchaser acknowledges and agrees
that all certificates representing the shares shall have endorsed thereon the
following legend
4.4 LEGEND. Each Purchaser acknowledges and agrees that all
certificates representing the Shares shall have endorsed thereon the following
legends:
(A) "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."
(B) Any legend required by appropriate state Blue Sky officials.
5. CONDITIONS TO CLOSING
5.1 CONDITIONS TO PURCHASERS' OBLIGATIONS AT THE CLOSING. Purchasers'
obligations to purchase the Shares at the Closing are subject to the
satisfaction, at or prior to the Closing, of the following conditions:
(A) REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE OF
OBLIGATIONS. The representations and warranties made by the Company in Section 3
hereof shall be true and correct in all material respects as of the Closing
Date.
(B) LEGAL INVESTMENT. On the Closing Date, the sale and issuance of
the Shares and the proposed issuance of the Shares shall be legally permitted by
all laws and regulations to which Purchasers and the Company are subject.
(C) CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained
any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the
Registration Rights Agreement (except for such as may be properly obtained
subsequent to the Closing).
(D) REGISTRATION RIGHTS AGREEMENT. A Registration Rights Agreement,
substantially in the form attached hereto as Exhibit C, shall have been executed
and delivered by the parties thereto.
7.
<PAGE> 12
(E) LEGAL OPINION. The Purchasers shall have received an opinion,
dated as of the Closing Date, from Cooley Godward LLP, legal counsel to the
Company, in the form attached hereto as Exhibit D.
(F) PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated at the Closing hereby and all
documents and instruments incident to such transactions shall be reasonably
satisfactory in substance and form to the Purchasers and their counsel, and the
Purchasers and their counsel shall have received all such counterpart originals
or certified or other copies of such documents as they may reasonably request.
5.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The Company's obligation
to issue and sell the Shares at the Closing is subject to the satisfaction, on
or prior to such Closing, of the following conditions:
(A) REPRESENTATIONS AND WARRANTIES TRUE. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects at the date of each Closing, with the same force and
effect as if they had been made on and as of said date.
(B) PERFORMANCE OF OBLIGATIONS. Purchasers shall have performed and
complied with all agreements and conditions herein required to be performed or
complied with by Purchasers on or before each Closing.
(C) REGISTRATION RIGHTS AGREEMENT. A Registration Rights Agreement,
substantially in the form attached hereto as Exhibit C, shall have been executed
and delivered by the Purchasers.
(D) CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained
any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the
Investors' Rights Agreement (except for such as may be properly obtained
subsequent to the Closing).
6. MISCELLANEOUS
6.1 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of New York as such laws are applied to agreements between
New York residents entered into and performed entirely in New York, except that
the Delaware General Corporation Law will govern as to matters of corporate law.
6.2 SURVIVAL. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any Purchaser and the
closing of the transactions contemplated hereby. All statements as to factual
matters contained in any certificate or other instrument delivered by or on
behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.
6.3 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs,
8.
<PAGE> 13
executors and administrators of the parties hereto and shall inure to the
benefit of and be enforceable by each person who shall be a holder of the Shares
from time to time.
6.4 ENTIRE AGREEMENT. This Agreement, the Exhibits hereto, including
the Registration Rights Agreement, and the other documents delivered pursuant
hereto constitute the full and entire understanding and agreement between the
parties with regard to the subjects hereof and no party shall be liable or bound
to any other in any manner by any representations, warranties, covenants and
agreements except as specifically set forth herein and therein.
6.5 SEVERABILITY. In case any provision of the Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
6.6 AMENDMENT AND WAIVER.
(A) This Agreement may be amended or modified only upon the written
consent of the Company and holders of a majority of the Shares (which have not
been sold to the public).
(B) The obligations of the Company and the rights of the holders of
the Shares under the Agreement may be waived only with the written consent of
the holders of a majority of the Shares (which have not been sold to the
public).
6.7 NOTICES. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified; (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day; (iii) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (iv) one (1) day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the
Company at the address as set forth on the signature page hereof and to
Purchaser at the address as set forth on Exhibit A hereto or at such other
address as the Company or Purchaser may designate by ten (10) days advance
written notice to the other parties hereto.
6.8 EXPENSES. The Company shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and performance of
the Agreement.
6.9 ATTORNEYS' FEES. In the event that any dispute among the parties to
this Agreement should result in litigation, the prevailing party in such dispute
shall be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement, including without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.
6.10 TITLES AND SUBTITLES. The titles of the sections and subsections
of the Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
6.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
9.
<PAGE> 14
6.12 BROKER'S FEES. Each party hereto represents and warrants that
except for the fees payable to John G. Kinnard & Co.(which fees shall be the
sole responsibility of the Company), no agent, broker, investment banker, person
or firm acting on behalf of or under the authority of such party hereto is or
will be entitled to any broker's or finder's fee or any other commission
directly or indirectly in connection with the transactions contemplated herein.
Each party hereto further agrees to indemnify each other party for any claims,
losses or expenses incurred by such other party as a result of the
representation in this Section 6.12 being untrue.
6.13 EXCULPATION AMONG PURCHASERS. Each Purchaser acknowledges that it
is not relying upon any person, firm, or corporation, other than the Company and
its officers and directors, in making its investment or decision to invest in
the Company. Each Purchaser agrees that no Purchaser nor the respective
controlling persons, officers, directors, partners, agents, or employees of any
Purchaser shall be liable for any action heretofore or hereafter taken or
omitted to be taken by any of them in connection with the Shares.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
10.
<PAGE> 15
COMMON STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have executed the COMMON STOCK
PURCHASE AGREEMENT as of the date set forth in the first paragraph hereof.
COMPANY:
BOLDER TECHNOLOGIES CORPORATION
By:
----------------------------------------
Daniel S. Lankford
President and Chief Executive Officer
PURCHASER:
LEGAL NAME OF PURCHASER:
--------------------------------------------------------
Type of Purchaser: Please check the applicable box:
<TABLE>
<S> <C> <C> <C> <C>
|_| Individual |_| Trust
|_| Corporation |_| Other
|_| Partnership -----------------
Primary contact person:
------------------------
Address:
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Telephone Number:
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Fax Number:
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Please specify your Tax I.D. Number or
Social Security Number or |_| Tax I.D. No.: _______________________
Check the appropriate box: |_| Social Security No: _________________
|_| Exempt under IRC ss.401(a)
|_| Exempt under IRS ss.501(c)(3)
</TABLE>
By:
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Name:
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Title:
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Date:
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<PAGE> 1
EXHIBIT 10.2
BOLDER TECHNOLOGIES CORPORATION
COMMON STOCK
PURCHASE AGREEMENT
MAY 18, 1999
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C> <C> <C>
1. Agreement to Sell and Purchase...........................................................................1
1.1 Authorization of Shares.........................................................................1
1.2 Sale and Purchase...............................................................................1
2. Closing, Delivery and Payment............................................................................1
2.1 Closing.........................................................................................1
2.2 Delivery........................................................................................2
3. Representations and Warranties of the Company............................................................2
3.1 Organization, Good Standing and Qualification...................................................2
3.2 Capitalization..................................................................................2
3.3 Authorization; Binding Obligations..............................................................3
3.4 SEC Documents; Financial Statements.............................................................3
3.5 No Material Adverse Change......................................................................4
3.6 Liabilities.....................................................................................4
3.7 Title to Properties and Assets; Liens, Etc......................................................4
3.8 Intellectual Property...........................................................................4
3.9 No Conflicts....................................................................................4
3.10 No Consents.....................................................................................5
3.11 Litigation......................................................................................5
3.12 Offering Valid..................................................................................5
3.13 Compliance with Laws............................................................................5
3.14 Permits.........................................................................................5
4. Representations and Warranties of the Purchasers.........................................................5
4.1 Requisite Power and Authority...................................................................5
4.2 Investment Representations......................................................................6
(a) Purchaser Bears Economic Risk..........................................................6
(b) Acquisition for Own Account............................................................6
(c) Purchaser Can Protect Its Interest.....................................................6
(d) Accredited Investor....................................................................6
(e) Rule 144...............................................................................6
(f) Residence..............................................................................7
4.3 Transfer Restrictions...........................................................................7
</TABLE>
i.
<PAGE> 3
TABLE OF CONTENTS
(CONTINUED)
<TABLE>
<CAPTION>
PAGE
<S> <C> <C> <C>
4.4 Legend..........................................................................................7
5. Conditions to Closing....................................................................................7
5.1 Conditions to Purchasers' Obligations at the Closing............................................7
(a) Representations and Warranties True; Performance of Obligations........................7
(b) Legal Investment.......................................................................7
(c) Consents, Permits, and Waivers.........................................................8
(d) Registration Rights Agreement..........................................................8
(e) Legal Opinion..........................................................................8
(f) Proceedings and Documents..............................................................8
5.2 Conditions to Obligations of the Company........................................................8
(a) Representations and Warranties True....................................................8
(b) Performance of Obligations.............................................................8
(c) Registration Rights Agreement..........................................................8
(d) Consents, Permits, and Waivers.........................................................8
6. Miscellaneous............................................................................................8
6.1 Governing Law...................................................................................8
6.2 Survival........................................................................................9
6.3 Successors and Assigns..........................................................................9
6.4 Entire Agreement................................................................................9
6.5 Severability....................................................................................9
6.6 Amendment and Waiver............................................................................9
6.7 Notices.........................................................................................9
6.8 Expenses.......................................................................................10
6.9 Attorneys' Fees................................................................................10
6.10 Titles and Subtitles...........................................................................10
6.11 Counterparts...................................................................................10
6.12 Broker's Fees..................................................................................10
6.13 Exculpation Among Purchasers...................................................................10
</TABLE>
ii.
<PAGE> 4
INDEX OF EXHIBITS
-----------------
Schedule of Purchasers Exhibit A
Amended and Restated Certificate
of Incorporation Exhibit B
Registration Rights Agreement Exhibit C
Opinion of Cooley Godward LLP Exhibit D
<PAGE> 5
BOLDER TECHNOLOGIES CORPORATION
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (the "AGREEMENT") is entered into
as of this 18th day of May, 1999, by and among BOLDER TECHNOLOGIES CORPORATION,
a Delaware corporation (the "COMPANY"), and each of those persons and entities,
severally and not jointly, whose names are set forth on the Schedule of
Purchasers attached hereto as Exhibit A (which persons and entities are
hereinafter collectively referred to as "PURCHASERS" and each individually as a
"PURCHASER").
RECITALS
WHEREAS, the Company has authorized the sale and issuance of an
aggregate of up to 1,500,000 shares of its Common Stock (the "SHARES");
WHEREAS, Purchasers desire to purchase the Shares on the terms and
conditions set forth herein; and
WHEREAS, the Company desires to issue and sell the Shares to Purchasers
on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual promises hereinafter set forth, the parties hereto agree as follows:
1. AGREEMENT TO SELL AND PURCHASE
1.1 AUTHORIZATION OF SHARES. On or prior to the Closing (as defined in
Section 2 below), the Company shall have authorized the sale and issuance to
Purchasers of the Shares. The Shares shall have the rights, preferences,
privileges and restrictions set forth in the Amended and Restated Certificate of
Incorporation of the Company, in the form attached hereto as Exhibit B (the
"RESTATED CERTIFICATE").
1.2 SALE AND PURCHASE. Subject to the terms and conditions hereof, at
the Closing (as hereinafter defined), the Company hereby agrees to issue and
sell to each Purchaser, severally and not jointly, and each Purchaser agrees to
purchase from the Company, severally and not jointly, the number of Shares set
forth opposite such Purchaser's name on Exhibit A at a purchase price of $6.00
per share.
2. CLOSING, DELIVERY AND PAYMENT
2.1 CLOSING. The closing of the sale and purchase of the Shares under
this Agreement (the "CLOSING") shall take place on the date hereof, at the
offices of Cooley Godward LLP, 2595 Canyon Boulevard, Suite 250, Boulder,
Colorado 80302 or at such other time or place as the Company and Purchasers may
mutually agree (such date is hereinafter referred to as the "CLOSING DATE").
1.
<PAGE> 6
2.2 DELIVERY. At the Closing, subject to the terms and conditions
hereof, the Company will deliver to the Purchasers certificates representing the
number of Shares to be purchased at the Closing by each Purchaser, against
payment of the purchase price therefor by wire transfer made payable to the
order of the Company.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
For purposes of this Agreement, "SEC DOCUMENTS" means, with respect to
any date or time referred to in this Agreement, all reports, registration
statements and definitive proxy statements filed by the Company (together with
any amendments required to be made with respect thereto) with the Securities and
Exchange Commission (the "COMMISSION") subsequent to December 1, 1997 and prior
to the date hereof, including all exhibits and schedules thereto and any
documents incorporated therein by reference. In addition, "RULES AND
REGULATIONS" means the rules and regulations adopted by the Commission under the
Securities Act of 1933, as amended (the "SECURITIES ACT") or the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), as applicable. All
references in this Agreement to financial statements and schedules and other
information which is "contained," "included," "stated," "described" or
"disclosed" in the SEC Documents (or other references of like import) shall be
deemed to mean and include all such financial statements and schedules and other
information which are incorporated in the SEC Documents.
Except as otherwise described or disclosed in the SEC Documents, the
Company (except where the context requires otherwise, for the purposes of this
Section 3, the "Company" shall mean the Company as well as its wholly-owned
subsidiaries) hereby represents and warrants to each Purchaser as follows:
3.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company has all requisite corporate power and
authority to own and operate its properties and assets, to execute and deliver
this Agreement and the Registration Rights Agreement, in the form attached
hereto as Exhibit C (the "REGISTRATION RIGHTS AGREEMENT"), to issue and sell the
Shares and to carry out the provisions of this Agreement, the Registration
Rights Agreement and the Restated Certificate and to carry on its business as
presently conducted and as presently proposed to be conducted. The Company is
duly qualified and licensed and in good standing as a foreign corporation in
each jurisdiction in which its ownership or leasing of any properties or the
character of its operations requires such qualification or licensing, except
where the failure to be so qualified or licensed would not have a material
adverse effect on the condition, financial or otherwise, results of operations
or business of the Company, taken as a whole (a "MATERIAL ADVERSE EFFECT"). The
Company has no subsidiaries, corporate or otherwise.
3.2 CAPITALIZATION. The authorized capital stock of the Company,
immediately prior to the Closing, will consist of (a) 25,000,000 shares of
Common Stock, of which 9,715,130 shares were issued and outstanding as of May 1,
1999, and of which 1,547,437 shares are reserved or will be reserved in the
future for issuance by the Company to key employees, consultants and others
affiliated with the Company pursuant to stock grant, stock purchase and/or
option plans or any other stock incentive program, arrangement or agreement
approved by the Company's Board of Directors, and (b) 5,000,000 shares of
Preferred Stock, of which 336,200
2.
<PAGE> 7
shares are designated Series A Convertible Preferred Stock, all of which are
issued and outstanding, and of which 250,000 shares are designated Series B
Junior Participating Preferred Stock, none of which are issued and outstanding.
All issued and outstanding shares of the Company's Common Stock and Preferred
Stock (i) have been duly authorized and validly issued, (ii) are fully paid and
nonassessable and (iii) were issued in compliance with all applicable state and
federal laws concerning the issuance of securities. The rights, preferences,
privileges and restrictions of the Shares are as stated in the Restated
Certificate. Except with respect to (i) the Company's Rights Agreement dated as
of January 23, 1998, (ii) the Company's outstanding shares of Series A
Convertible Preferred Stock, (iii) the Company's 1996 Employee Stock Purchase
Plan, (iv) the Company's 1996 Equity Incentive Plan, (v) warrants to purchase
Common Stock described in the SEC Documents, or (vi) as may be granted pursuant
to this Agreement, there are no outstanding options, warrants, rights (including
conversion or preemptive rights and rights of first refusal), proxy or
stockholder agreements, or agreements of any kind for the purchase or
acquisition from the Company of any of its securities. When issued in compliance
with the provisions of this Agreement and the Restated Certificate, the Shares
will be validly issued, fully paid and nonassessable and will be free of any
liens or encumbrances.
3.3 AUTHORIZATION; BINDING OBLIGATIONS. All corporate action on the
part of the Company, its officers, directors and stockholders necessary for the
authorization of this Agreement and the Registration Rights Agreement, the
performance of all obligations of the Company hereunder and thereunder at the
Closing and the authorization, sale, issuance and delivery of the Shares
pursuant hereto and pursuant to the Restated Certificate has been taken or will
be taken prior to the Closing. The Agreement and the Registration Rights
Agreement, when executed and delivered, will be valid and binding obligations of
the Company enforceable in accordance with their terms except (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws of
general application affecting enforcement of creditors' rights, (ii) general
principles of equity that restrict the availability of equitable remedies and
(iii) to the extent that the enforceability of the indemnification provisions of
the Registration Rights Agreement may be limited by applicable laws.
3.4 SEC DOCUMENTS; FINANCIAL STATEMENTS. As of their respective filing
dates, the SEC Documents complied in all material respects with the requirements
of the Securities Act, the Exchange Act and the Rules and Regulations. As of
their filing date, none of the SEC Documents contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, except to the extent
corrected by a document subsequently filed with the Commission. The SEC
Documents constitute all reports, registration statements, proxy statement and
other filings required to be made by the Company pursuant to the Securities Act
and the Exchange Act subsequent to December 1, 1997. All material contracts and
other documents of the Company required to be filed as exhibits to the SEC
Documents have been filed as required. The financial statements of the Company,
together with the related notes thereto, included in the SEC Documents comply as
to form in all material respects with the Rules and Regulations, have been
prepared in conformity with generally accepted accounting principles
consistently applied (except as may be indicated in the notes thereto) and
fairly present in all material respects the Company's financial position at the
dates thereof and the Company's results of operations, changes in stockholders'
equity and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal audit adjustments which will not be material in
amount or significance).
3.
<PAGE> 8
3.5 NO MATERIAL ADVERSE CHANGE. Since December 31, 1998, there has been
no material adverse change or development involving a prospective material
adverse change in the condition, financial or otherwise, results of operations
or business of the Company taken as a whole, whether or not arising in the
ordinary course of business. Since December 31, 1998, (i) there have been no
transactions entered into by the Company, other than those in the ordinary
course of business, which are material with respect to the Company, and (ii)
there has been no dividend or distribution of any kind declared, paid or made by
the Company on any class of its capital stock, other than regularly scheduled
dividend payments on the Company's outstanding Series A Convertible Preferred
Stock.
3.6 LIABILITIES. The Company does not have any liability or obligation
(whether accrued, absolute, contingent, matured, unmatured or other) which if
known would be required to be reflected in the Company's financial statements in
accordance with generally accepted accounting principles, except for any such
liability or obligation which (i) has been reflected in the Company's balance
sheet at December 31, 1998 or (ii) has arisen in the ordinary course of business
since December 31, 1998, consistent with past practices.
3.7 TITLE TO PROPERTIES AND ASSETS; LIENS, ETC. The Company has good
and marketable title to its properties and assets, and good title to its
leasehold interests, in each case subject to no mortgage, pledge, lien, lease,
encumbrance or charge.
3.8 INTELLECTUAL PROPERTY. The Company owns or possesses sufficient
legal rights to all patents, trademarks, service marks, trade names, copyrights,
trade secrets, information and other proprietary rights and processes necessary
for its business as now conducted and as proposed to be conducted. The Company
has not received any communications alleging that it has violated or, by
conducting its business as proposed would violate, any proprietary rights of any
other person, nor is the Company aware of any basis for the foregoing.
3.9 NO CONFLICTS. None of the Company's issue and sale of the Common
Stock, the execution or delivery of this Agreement and the Registration Rights
Agreement, its performance hereunder and thereunder, its consummation of the
transactions contemplated herein and therein conflicts or will conflict with or
results or will result in any breach or violation of any of the terms or
provisions of, or constitutes or will constitute a default under, or results or
will result in the creation or imposition of any lien, charge, claim,
encumbrance, pledge, security interest, defect or other restriction or equity of
any kind whatsoever upon any property or assets of the Company pursuant to the
terms of, (i) the Restated Certificate or by-laws of the Company, (ii) any
license, contract, indenture, mortgage, deed of trust, voting trust agreement,
stockholders' agreement, note, loan or credit agreement or other agreement or
instrument to which the Company is a party or by which it is or may be bound or
to which its properties or assets is or may be subject, or (iii) any statute,
judgment, decree, order, rule or regulation applicable to the Company of any
arbitrator, court, regulatory body or administrative agency or other
governmental agency or body, having jurisdiction over the Company or any of
their respective activities or properties except, in the case of clauses (ii)
and (iii), such defaults, impositions and violations that would not have a
Material Adverse Effect.
3.10 NO CONSENTS. No consent, approval, authorization or order of, and
no filing with, any court, arbitrator, regulatory body, government agency or
other body, domestic or foreign, is required for the execution, delivery or
performance of this Agreement, the Registration Rights
4.
<PAGE> 9
Agreement (execution and delivery only) or the transactions contemplated hereby
or thereby, except (i) the filing of a Form D with the Commission relating to
the sale of the Shares, (ii) such additional steps as may be required by the
Commission, and (iii) such additional steps as may be necessary to qualify the
Shares for sale by the Purchasers under state securities or Blue Sky laws.
3.11 LITIGATION. There is no action, suit, proceeding or investigation
pending or, to the Company's knowledge, currently threatened against the Company
which (i) questions the validity of the capital stock of the Company or of this
Agreement or the Registration Rights Agreement or of any action taken or to be
taken by the Company pursuant to or in connection with this Agreement or the
Registration Rights Agreement, or (ii) would be reasonably likely to result in a
Material Adverse Effect.
3.12 OFFERING VALID. Assuming the accuracy of the representations and
warranties of the Purchasers contained in Section 4.2 hereof, the offer, sale
and issuance of the Shares will be exempt from the registration requirements of
the Securities Act and will have been registered or qualified (or are exempt
from registration and qualification) under the registration, permit or
qualification requirements of all applicable state securities laws.
3.13 COMPLIANCE WITH LAWS. The Company's business has been conducted in
compliance with all applicable laws and regulations of governmental authorities,
except for such violations that have been cured or that, individually or in the
aggregate, would not be reasonably likely to result in a Material Adverse
Effect.
3.14 PERMITS. To the knowledge of the Company, the Company has all
franchises, permits, licenses and other authority necessary for its business as
now being conducted and believes it can obtain, without undue burden or expense,
any similar authority for its business as planned to be conducted. The Company
is not in default in any material respect under any such franchise, permit,
license or other authority.
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Each Purchaser hereby represents and warrants to the Company as follows
(such representations and warranties do not lessen or obviate the
representations and warranties of the Company set forth in this Agreement):
4.1 REQUISITE POWER AND AUTHORITY. Purchaser has all necessary power
and authority under all applicable provisions of law to execute and deliver this
Agreement and the Registration Rights Agreement and to carry out their
provisions. All action on Purchaser's part required for the lawful execution and
delivery of this Agreement and the Registration Rights Agreement have been or
will be effectively taken prior to the Closing. Upon their execution and
delivery, this Agreement and the Registration Rights Agreement will be valid and
binding obligations of Purchaser, enforceable in accordance with their terms,
except (i) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application affecting enforcement of
creditors' rights, (ii) general principles of equity that restrict the
availability of equitable remedies and (iii) to the extent that the
enforceability of the indemnification provisions of the Registration Rights
Agreement may be limited by applicable laws.
5.
<PAGE> 10
4.2 INVESTMENT REPRESENTATIONS. Purchaser understands that the Shares
have not been registered under the Securities Act. Purchaser also understands
that the Shares are being offered and sold pursuant to an exemption from
registration contained in the Securities Act based in part upon Purchaser's
representations contained in the Agreement. Purchaser hereby represents and
warrants as follows:
(A) PURCHASER BEARS ECONOMIC RISK. Purchaser has substantial
experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it is capable of
evaluating the merits and risks of its investment in the Company and has the
capacity to protect its own interests. Purchaser must bear the economic risk of
this investment indefinitely unless the Shares are registered pursuant to the
Securities Act, or an exemption from registration is available. Purchaser
understands that except as required by the Registration Rights Agreement, the
Company has no intention of registering the Shares. Purchaser also understands
that there is no assurance that any registration under the Registration Rights
Agreement or exemption from registration under the Securities Act will be
available and that, even if available, such registration or exemption may not
allow Purchaser to transfer all or any portion of the Shares under the
circumstances, in the amounts or at the times Purchaser might propose.
(B) ACQUISITION FOR OWN ACCOUNT. Purchaser is acquiring the Shares
for Purchaser's own account for investment only, and not with a view towards
their distribution.
(C) PURCHASER CAN PROTECT ITS INTEREST. Purchaser represents that
by reason of its, or of its management's, business or financial experience,
Purchaser has the capacity to protect its own interests in connection with the
transactions contemplated in this Agreement. Further, Purchaser is aware of no
publication of any advertisement in connection with the transactions
contemplated in the Agreement.
(D) ACCREDITED INVESTOR. Purchaser represents that it is an
accredited investor within the meaning of Regulation D under the Securities Act.
(E) RULE 144. Purchaser acknowledges and agrees that the Shares
must be held indefinitely unless they are subsequently registered under the
Securities Act or an exemption from such registration is available. Purchaser
has been advised or is aware of the provisions of Rule 144 promulgated under the
Securities Act, which permits limited resale of shares purchased in a private
placement subject to the satisfaction of certain conditions, including, among
other things, the availability of certain current public information about the
Company, the resale occurring following the required holding period under Rule
144 and the number of shares being sold during any three-month period not
exceeding specified limitations.
(F) RESIDENCE. If the Purchaser is an individual, then the
Purchaser resides in the state or province identified in the address of the
Purchaser set forth on Exhibit A; if the Purchaser is a partnership,
corporation, limited liability company or other entity, then the office or
offices of the Purchaser in which its investment decision was made is located at
the address or addresses of the Purchaser set forth on Exhibit A.
4.3 TRANSFER RESTRICTIONS. Each Purchaser agrees that Purchaser shall
in no event make any disposition of all or any portion of the Shares unless and
until (i) there is then in effect
6.
<PAGE> 11
a registration statement under the Securities Act covering such proposed
disposition and such disposition is made in accordance with said registration
statement; or (ii) (A) Purchaser shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed statement of
the circumstances surrounding the proposed disposition, (B) if requested by the
Company, Purchaser shall have furnished the Company with an opinion of
Purchaser's own counsel to the effect that such disposition will not require
registration of such Shares under the Securities Act and (C) such opinion of
Purchaser's counsel shall have been concurred in by counsel for the Company,
such concurrence not to be unreasonably withheld, and the Company shall have
advised Purchaser of such concurrence. Each Purchaser acknowledges and agrees
that all certificates representing the shares shall have endorsed thereon the
following legend
4.4 LEGEND. Each Purchaser acknowledges and agrees that all
certificates representing the Shares shall have endorsed thereon the following
legends:
(A) "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."
(B) Any legend required by appropriate state Blue Sky officials.
5. CONDITIONS TO CLOSING
5.1 CONDITIONS TO PURCHASERS' OBLIGATIONS AT THE CLOSING. Purchasers'
obligations to purchase the Shares at the Closing are subject to the
satisfaction, at or prior to the Closing, of the following conditions:
(A) REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE OF
OBLIGATIONS. The representations and warranties made by the Company in Section 3
hereof shall be true and correct in all material respects as of the Closing
Date.
(B) LEGAL INVESTMENT. On the Closing Date, the sale and issuance of
the Shares and the proposed issuance of the Shares shall be legally permitted by
all laws and regulations to which Purchasers and the Company are subject.
(C) CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained
any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the
Registration Rights Agreement (except for such as may be properly obtained
subsequent to the Closing).
(D) REGISTRATION RIGHTS AGREEMENT. A Registration Rights Agreement,
substantially in the form attached hereto as Exhibit C, shall have been executed
and delivered by the parties thereto.
7.
<PAGE> 12
(E) LEGAL OPINION. The Purchasers shall have received an opinion,
dated as of the Closing Date, from Cooley Godward LLP, legal counsel to the
Company, in the form attached hereto as Exhibit D.
(F) PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated at the Closing hereby and all
documents and instruments incident to such transactions shall be reasonably
satisfactory in substance and form to the Purchasers and their counsel, and the
Purchasers and their counsel shall have received all such counterpart originals
or certified or other copies of such documents as they may reasonably request.
5.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The Company's obligation
to issue and sell the Shares at the Closing is subject to the satisfaction, on
or prior to such Closing, of the following conditions:
(A) REPRESENTATIONS AND WARRANTIES TRUE. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects at the date of each Closing, with the same force and
effect as if they had been made on and as of said date.
(B) PERFORMANCE OF OBLIGATIONS. Purchasers shall have performed and
complied with all agreements and conditions herein required to be performed or
complied with by Purchasers on or before each Closing.
(C) REGISTRATION RIGHTS AGREEMENT. A Registration Rights Agreement,
substantially in the form attached hereto as Exhibit C, shall have been executed
and delivered by the Purchasers.
(D) CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained
any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the
Investors' Rights Agreement (except for such as may be properly obtained
subsequent to the Closing).
6. MISCELLANEOUS
6.1 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of New York as such laws are applied to agreements between
New York residents entered into and performed entirely in New York, except that
the Delaware General Corporation Law will govern as to matters of corporate law.
6.2 SURVIVAL. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any Purchaser and the
closing of the transactions contemplated hereby. All statements as to factual
matters contained in any certificate or other instrument delivered by or on
behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.
6.3 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs,
8.
<PAGE> 13
executors and administrators of the parties hereto and shall inure to the
benefit of and be enforceable by each person who shall be a holder of the Shares
from time to time.
6.4 ENTIRE AGREEMENT. This Agreement, the Exhibits hereto, including
the Registration Rights Agreement, and the other documents delivered pursuant
hereto constitute the full and entire understanding and agreement between the
parties with regard to the subjects hereof and no party shall be liable or bound
to any other in any manner by any representations, warranties, covenants and
agreements except as specifically set forth herein and therein.
6.5 SEVERABILITY. In case any provision of the Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
6.6 AMENDMENT AND WAIVER.
(A) This Agreement may be amended or modified only upon the written
consent of the Company and holders of a majority of the Shares (which have not
been sold to the public).
(B) The obligations of the Company and the rights of the holders of
the Shares under the Agreement may be waived only with the written consent of
the holders of a majority of the Shares (which have not been sold to the
public).
6.7 NOTICES. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified; (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day; (iii) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (iv) one (1) day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the
Company at the address as set forth on the signature page hereof and to
Purchaser at the address as set forth on Exhibit A hereto or at such other
address as the Company or Purchaser may designate by ten (10) days advance
written notice to the other parties hereto.
6.8 EXPENSES. The Company shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and performance of
the Agreement.
6.9 ATTORNEYS' FEES. In the event that any dispute among the parties to
this Agreement should result in litigation, the prevailing party in such dispute
shall be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement, including without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.
6.10 TITLES AND SUBTITLES. The titles of the sections and subsections
of the Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
6.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
9.
<PAGE> 14
6.12 BROKER'S FEES. Each party hereto represents and warrants that
except for the fees payable to John G. Kinnard & Co.(which fees shall be the
sole responsibility of the Company), no agent, broker, investment banker, person
or firm acting on behalf of or under the authority of such party hereto is or
will be entitled to any broker's or finder's fee or any other commission
directly or indirectly in connection with the transactions contemplated herein.
Each party hereto further agrees to indemnify each other party for any claims,
losses or expenses incurred by such other party as a result of the
representation in this Section 6.12 being untrue.
6.13 EXCULPATION AMONG PURCHASERS. Each Purchaser acknowledges that it
is not relying upon any person, firm, or corporation, other than the Company and
its officers and directors, in making its investment or decision to invest in
the Company. Each Purchaser agrees that no Purchaser nor the respective
controlling persons, officers, directors, partners, agents, or employees of any
Purchaser shall be liable for any action heretofore or hereafter taken or
omitted to be taken by any of them in connection with the Shares.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
10.
<PAGE> 15
COMMON STOCK PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties hereto have executed the COMMON STOCK
PURCHASE AGREEMENT as of the date set forth in the first paragraph hereof.
COMPANY:
BOLDER TECHNOLOGIES CORPORATION
By:
----------------------------------------
Daniel S. Lankford
President and Chief Executive Officer
PURCHASER:
LEGAL NAME OF PURCHASER:
--------------------------------------------------------
Type of Purchaser: Please check the applicable box:
<TABLE>
<S> <C> <C> <C> <C>
|_| Individual |_| Trust
|_| Corporation |_| Other
|_| Partnership ------------------
Primary contact person:
------------------------------
Address:
------------------------------
------------------------------
------------------------------
Telephone Number:
------------------------------
Fax Number:
------------------------------
Please specify your Tax I.D. Number or
Social Security Number or |_| Tax I.D. No.: ______________________
Check the appropriate box: |_| Social Security No: ________________
|_| Exempt under IRC ss.401(a)
|_| Exempt under IRS ss.501(c)(3)
</TABLE>
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Date:
--------------------------------------
<PAGE> 1
EXHIBIT 10.3
BOLDER TECHNOLOGIES CORPORATION
COMMON STOCK
PURCHASE AGREEMENT
JULY 9, 1999
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C> <C> <C>
1. Agreement to Sell and Purchase...........................................................................1
1.1 Authorization of Shares.........................................................................1
1.2 Sale and Purchase...............................................................................1
2. Closing, Delivery and Payment............................................................................1
2.1 Closing.........................................................................................1
2.2 Delivery........................................................................................2
3. Representations and Warranties of the Company............................................................2
3.1 Organization, Good Standing and Qualification...................................................2
3.2 Capitalization..................................................................................2
3.3 Authorization; Binding Obligations..............................................................3
3.4 SEC Documents; Financial Statements.............................................................3
3.5 No Material Adverse Change......................................................................4
3.6 Liabilities.....................................................................................4
3.7 Title to Properties and Assets; Liens, Etc......................................................4
3.8 Intellectual Property...........................................................................4
3.9 No Conflicts....................................................................................4
3.10 No Consents.....................................................................................5
3.11 Litigation......................................................................................5
3.12 Offering Valid..................................................................................5
3.13 Compliance with Laws............................................................................5
3.14 Permits.........................................................................................5
4. Representations and Warranties of the Purchasers.........................................................5
4.1 Requisite Power and Authority...................................................................5
4.2 Investment Representations......................................................................6
(a) Purchaser Bears Economic Risk..........................................................6
(b) Acquisition for Own Account............................................................6
(c) Purchaser Can Protect Its Interest.....................................................6
(d) Accredited Investor....................................................................6
(e) Rule 144...............................................................................6
(f) Residence..............................................................................7
4.3 Transfer Restrictions...........................................................................7
</TABLE>
i.
<PAGE> 3
TABLE OF CONTENTS
(CONTINUED)
<TABLE>
<CAPTION>
PAGE
<S> <C> <C> <C>
4.4 Legend..........................................................................................7
5. Conditions to Closing....................................................................................7
5.1 Conditions to Purchasers' Obligations at the Closing............................................7
(a) Representations and Warranties True; Performance of Obligations........................7
(b) Legal Investment.......................................................................7
(c) Consents, Permits, and Waivers.........................................................8
(d) Registration Rights Agreement..........................................................8
(e) Legal Opinion..........................................................................8
(f) Proceedings and Documents..............................................................8
5.2 Conditions to Obligations of the Company........................................................8
(a) Representations and Warranties True....................................................8
(b) Performance of Obligations.............................................................8
(c) Registration Rights Agreement..........................................................8
(d) Consents, Permits, and Waivers.........................................................8
6. Miscellaneous............................................................................................8
6.1 Governing Law...................................................................................8
6.2 Survival........................................................................................9
6.3 Successors and Assigns..........................................................................9
6.4 Entire Agreement................................................................................9
6.5 Severability....................................................................................9
6.6 Amendment and Waiver............................................................................9
6.7 Notices.........................................................................................9
6.8 Expenses.......................................................................................10
6.9 Attorneys' Fees................................................................................10
6.10 Titles and Subtitles...........................................................................10
6.11 Counterparts...................................................................................10
6.12 Broker's Fees..................................................................................10
6.13 Exculpation Among Purchasers...................................................................10
</TABLE>
ii.
<PAGE> 4
INDEX OF EXHIBITS
-----------------
Schedule of Purchasers Exhibit A
Amended and Restated Certificate
of Incorporation Exhibit B
Registration Rights Agreement Exhibit C
Opinion of Cooley Godward LLP Exhibit D
<PAGE> 5
BOLDER TECHNOLOGIES CORPORATION
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (the "AGREEMENT") is entered into
as of this 9th day of July, 1999, by and among BOLDER TECHNOLOGIES CORPORATION,
a Delaware corporation (the "COMPANY"), and each of those persons and entities,
severally and not jointly, whose names are set forth on the Schedule of
Purchasers attached hereto as Exhibit A (which persons and entities are
hereinafter collectively referred to as "PURCHASERS" and each individually as a
"PURCHASER").
RECITALS
WHEREAS, the Company has authorized the sale and issuance of an
aggregate of up to 763,215 shares of its Common Stock (the "SHARES");
WHEREAS, Purchasers desire to purchase the Shares on the terms and
conditions set forth herein; and
WHEREAS, the Company desires to issue and sell the Shares to Purchasers
on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual promises hereinafter set forth, the parties hereto agree as follows:
1. AGREEMENT TO SELL AND PURCHASE
1.1 AUTHORIZATION OF SHARES. On or prior to the Closing (as defined in
Section 2 below), the Company shall have authorized the sale and issuance to
Purchasers of the Shares. The Shares shall have the rights, preferences,
privileges and restrictions set forth in the Amended and Restated Certificate of
Incorporation of the Company, in the form attached hereto as Exhibit B (the
"RESTATED CERTIFICATE").
1.2 SALE AND PURCHASE. Subject to the terms and conditions hereof, at
the Closing (as hereinafter defined), the Company hereby agrees to issue and
sell to each Purchaser, severally and not jointly, and each Purchaser agrees to
purchase from the Company, severally and not jointly, the number of Shares set
forth opposite such Purchaser's name on Exhibit A at a purchase price of $7.00
per share.
2. CLOSING, DELIVERY AND PAYMENT
2.1 CLOSING. The closing of the sale and purchase of the Shares under
this Agreement (the "CLOSING") shall take place on the date hereof, at the
offices of Cooley Godward LLP, 2595 Canyon Boulevard, Suite 250, Boulder,
Colorado 80302 or at such other time or place as the Company and Purchasers may
mutually agree (such date is hereinafter referred to as the "CLOSING DATE").
1.
<PAGE> 6
2.2 DELIVERY. At the Closing, subject to the terms and conditions
hereof, the Company will deliver to the Purchasers certificates representing the
number of Shares to be purchased at the Closing by each Purchaser, against
payment of the purchase price therefor by wire transfer made payable to the
order of the Company.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
For purposes of this Agreement, "SEC DOCUMENTS" means, with respect to
any date or time referred to in this Agreement, all reports, registration
statements and definitive proxy statements filed by the Company (together with
any amendments required to be made with respect thereto) with the Securities and
Exchange Commission (the "COMMISSION") subsequent to December 1, 1997 and prior
to the date hereof, including all exhibits and schedules thereto and any
documents incorporated therein by reference. In addition, "RULES AND
REGULATIONS" means the rules and regulations adopted by the Commission under the
Securities Act of 1933, as amended (the "SECURITIES ACT") or the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), as applicable. All
references in this Agreement to financial statements and schedules and other
information which is "contained," "included," "stated," "described" or
"disclosed" in the SEC Documents (or other references of like import) shall be
deemed to mean and include all such financial statements and schedules and other
information which are incorporated in the SEC Documents.
Except as otherwise described or disclosed in the SEC Documents, the
Company (except where the context requires otherwise, for the purposes of this
Section 3, the "Company" shall mean the Company as well as its wholly-owned
subsidiaries) hereby represents and warrants to each Purchaser as follows:
3.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. The Company has all requisite corporate power and
authority to own and operate its properties and assets, to execute and deliver
this Agreement and the Registration Rights Agreement, in the form attached
hereto as Exhibit C (the "REGISTRATION RIGHTS AGREEMENT"), to issue and sell the
Shares and to carry out the provisions of this Agreement, the Registration
Rights Agreement and the Restated Certificate and to carry on its business as
presently conducted and as presently proposed to be conducted. The Company is
duly qualified and licensed and in good standing as a foreign corporation in
each jurisdiction in which its ownership or leasing of any properties or the
character of its operations requires such qualification or licensing, except
where the failure to be so qualified or licensed would not have a material
adverse effect on the condition, financial or otherwise, results of operations
or business of the Company, taken as a whole (a "MATERIAL ADVERSE EFFECT"). The
Company has no subsidiaries, corporate or otherwise.
3.2 CAPITALIZATION. The authorized capital stock of the Company,
immediately prior to the Closing, will consist of (a) 25,000,000 shares of
Common Stock, of which 11,005,127 shares were issued and outstanding as of June
30, 1999, and of which 2,342,571 shares are reserved or will be reserved in the
future for issuance by the Company to key employees, consultants and others
affiliated with the Company pursuant to stock grant, stock purchase and/or
option plans or any other stock incentive program, arrangement or agreement
approved by the Company's Board of Directors, and (b) 5,000,000 shares of
Preferred Stock, of which 336,200
2.
<PAGE> 7
shares are designated Series A Convertible Preferred Stock, all of which are
issued and outstanding, and of which 250,000 shares are designated Series B
Junior Participating Preferred Stock, none of which are issued and outstanding.
All issued and outstanding shares of the Company's Common Stock and Preferred
Stock (i) have been duly authorized and validly issued, (ii) are fully paid and
nonassessable and (iii) were issued in compliance with all applicable state and
federal laws concerning the issuance of securities. The rights, preferences,
privileges and restrictions of the Shares are as stated in the Restated
Certificate. Except with respect to (i) the Company's Rights Agreement dated as
of January 23, 1998, (ii) the Company's outstanding shares of Series A
Convertible Preferred Stock, (iii) the Company's 1996 Employee Stock Purchase
Plan, (iv) the Company's 1996 Equity Incentive Plan, (v) warrants to purchase
Common Stock described in the SEC Documents, or (vi) as may be granted pursuant
to this Agreement, there are no outstanding options, warrants, rights (including
conversion or preemptive rights and rights of first refusal), proxy or
stockholder agreements, or agreements of any kind for the purchase or
acquisition from the Company of any of its securities. When issued in compliance
with the provisions of this Agreement and the Restated Certificate, the Shares
will be validly issued, fully paid and nonassessable and will be free of any
liens or encumbrances.
3.3 AUTHORIZATION; BINDING OBLIGATIONS. All corporate action on the
part of the Company, its officers, directors and stockholders necessary for the
authorization of this Agreement and the Registration Rights Agreement, the
performance of all obligations of the Company hereunder and thereunder at the
Closing and the authorization, sale, issuance and delivery of the Shares
pursuant hereto and pursuant to the Restated Certificate has been taken or will
be taken prior to the Closing. The Agreement and the Registration Rights
Agreement, when executed and delivered, will be valid and binding obligations of
the Company enforceable in accordance with their terms except (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws of
general application affecting enforcement of creditors' rights, (ii) general
principles of equity that restrict the availability of equitable remedies and
(iii) to the extent that the enforceability of the indemnification provisions of
the Registration Rights Agreement may be limited by applicable laws.
3.4 SEC DOCUMENTS; FINANCIAL STATEMENTS. As of their respective filing
dates, the SEC Documents complied in all material respects with the requirements
of the Securities Act, the Exchange Act and the Rules and Regulations. As of
their filing date, none of the SEC Documents contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, except to the extent
corrected by a document subsequently filed with the Commission. The SEC
Documents constitute all reports, registration statements, proxy statement and
other filings required to be made by the Company pursuant to the Securities Act
and the Exchange Act subsequent to December 1, 1997. All material contracts and
other documents of the Company required to be filed as exhibits to the SEC
Documents have been filed as required. The financial statements of the Company,
together with the related notes thereto, included in the SEC Documents comply as
to form in all material respects with the Rules and Regulations, have been
prepared in conformity with generally accepted accounting principles
consistently applied (except as may be indicated in the notes thereto) and
fairly present in all material respects the Company's financial position at the
dates thereof and the Company's results of operations, changes in stockholders'
equity and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal audit adjustments which will not be material in
amount or significance).
3.
<PAGE> 8
3.5 NO MATERIAL ADVERSE CHANGE. Since December 31, 1998, there has been
no material adverse change or development involving a prospective material
adverse change in the condition, financial or otherwise, results of operations
or business of the Company taken as a whole, whether or not arising in the
ordinary course of business. Since December 31, 1998, (i) there have been no
transactions entered into by the Company, other than those in the ordinary
course of business, which are material with respect to the Company, and (ii)
there has been no dividend or distribution of any kind declared, paid or made by
the Company on any class of its capital stock, other than regularly scheduled
dividend payments on the Company's outstanding Series A Convertible Preferred
Stock.
3.6 LIABILITIES. The Company does not have any liability or obligation
(whether accrued, absolute, contingent, matured, unmatured or other) which if
known would be required to be reflected in the Company's financial statements in
accordance with generally accepted accounting principles, except for any such
liability or obligation which (i) has been reflected in the Company's balance
sheet at December 31, 1998 or (ii) has arisen in the ordinary course of business
since December 31, 1998, consistent with past practices.
3.7 TITLE TO PROPERTIES AND ASSETS; LIENS, ETC. The Company has good
and marketable title to its properties and assets, and good title to its
leasehold interests, in each case subject to no mortgage, pledge, lien, lease,
encumbrance or charge.
3.8 INTELLECTUAL PROPERTY. The Company owns or possesses sufficient
legal rights to all patents, trademarks, service marks, trade names, copyrights,
trade secrets, information and other proprietary rights and processes necessary
for its business as now conducted and as proposed to be conducted. The Company
has not received any communications alleging that it has violated or, by
conducting its business as proposed would violate, any proprietary rights of any
other person, nor is the Company aware of any basis for the foregoing.
3.9 NO CONFLICTS. None of the Company's issue and sale of the Common
Stock, the execution or delivery of this Agreement and the Registration Rights
Agreement, its performance hereunder and thereunder, its consummation of the
transactions contemplated herein and therein conflicts or will conflict with or
results or will result in any breach or violation of any of the terms or
provisions of, or constitutes or will constitute a default under, or results or
will result in the creation or imposition of any lien, charge, claim,
encumbrance, pledge, security interest, defect or other restriction or equity of
any kind whatsoever upon any property or assets of the Company pursuant to the
terms of, (i) the Restated Certificate or by-laws of the Company, (ii) any
license, contract, indenture, mortgage, deed of trust, voting trust agreement,
stockholders' agreement, note, loan or credit agreement or other agreement or
instrument to which the Company is a party or by which it is or may be bound or
to which its properties or assets is or may be subject, or (iii) any statute,
judgment, decree, order, rule or regulation applicable to the Company of any
arbitrator, court, regulatory body or administrative agency or other
governmental agency or body, having jurisdiction over the Company or any of
their respective activities or properties except, in the case of clauses (ii)
and (iii), such defaults, impositions and violations that would not have a
Material Adverse Effect.
3.10 NO CONSENTS. No consent, approval, authorization or order of, and
no filing with, any court, arbitrator, regulatory body, government agency or
other body, domestic or foreign, is required for the execution, delivery or
performance of this Agreement, the Registration Rights
4.
<PAGE> 9
Agreement (execution and delivery only) or the transactions contemplated hereby
or thereby, except (i) the filing of a Form D with the Commission relating to
the sale of the Shares, (ii) such additional steps as may be required by the
Commission, and (iii) such additional steps as may be necessary to qualify the
Shares for sale by the Purchasers under state securities or Blue Sky laws.
3.11 LITIGATION. There is no action, suit, proceeding or investigation
pending or, to the Company's knowledge, currently threatened against the Company
which (i) questions the validity of the capital stock of the Company or of this
Agreement or the Registration Rights Agreement or of any action taken or to be
taken by the Company pursuant to or in connection with this Agreement or the
Registration Rights Agreement, or (ii) would be reasonably likely to result in a
Material Adverse Effect.
3.12 OFFERING VALID. Assuming the accuracy of the representations and
warranties of the Purchasers contained in Section 4.2 hereof, the offer, sale
and issuance of the Shares will be exempt from the registration requirements of
the Securities Act and will have been registered or qualified (or are exempt
from registration and qualification) under the registration, permit or
qualification requirements of all applicable state securities laws.
3.13 COMPLIANCE WITH LAWS. The Company's business has been conducted in
compliance with all applicable laws and regulations of governmental authorities,
except for such violations that have been cured or that, individually or in the
aggregate, would not be reasonably likely to result in a Material Adverse
Effect.
3.14 PERMITS. To the knowledge of the Company, the Company has all
franchises, permits, licenses and other authority necessary for its business as
now being conducted and believes it can obtain, without undue burden or expense,
any similar authority for its business as planned to be conducted. The Company
is not in default in any material respect under any such franchise, permit,
license or other authority.
4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS
Each Purchaser hereby represents and warrants to the Company as follows
(such representations and warranties do not lessen or obviate the
representations and warranties of the Company set forth in this Agreement):
4.1 REQUISITE POWER AND AUTHORITY. Purchaser has all necessary power
and authority under all applicable provisions of law to execute and deliver this
Agreement and the Registration Rights Agreement and to carry out their
provisions. All action on Purchaser's part required for the lawful execution and
delivery of this Agreement and the Registration Rights Agreement have been or
will be effectively taken prior to the Closing. Upon their execution and
delivery, this Agreement and the Registration Rights Agreement will be valid and
binding obligations of Purchaser, enforceable in accordance with their terms,
except (i) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application affecting enforcement of
creditors' rights, (ii) general principles of equity that restrict the
availability of equitable remedies and (iii) to the extent that the
enforceability of the indemnification provisions of the Registration Rights
Agreement may be limited by applicable laws.
5.
<PAGE> 10
4.2 INVESTMENT REPRESENTATIONS. Purchaser understands that the Shares
have not been registered under the Securities Act. Purchaser also understands
that the Shares are being offered and sold pursuant to an exemption from
registration contained in the Securities Act based in part upon Purchaser's
representations contained in the Agreement. Purchaser hereby represents and
warrants as follows:
(A) PURCHASER BEARS ECONOMIC RISK. Purchaser has substantial
experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it is capable of
evaluating the merits and risks of its investment in the Company and has the
capacity to protect its own interests. Purchaser must bear the economic risk of
this investment indefinitely unless the Shares are registered pursuant to the
Securities Act, or an exemption from registration is available. Purchaser
understands that except as required by the Registration Rights Agreement, the
Company has no intention of registering the Shares. Purchaser also understands
that there is no assurance that any registration under the Registration Rights
Agreement or exemption from registration under the Securities Act will be
available and that, even if available, such registration or exemption may not
allow Purchaser to transfer all or any portion of the Shares under the
circumstances, in the amounts or at the times Purchaser might propose.
(B) ACQUISITION FOR OWN ACCOUNT. Purchaser is acquiring the Shares
for Purchaser's own account for investment only, and not with a view towards
their distribution.
(C) PURCHASER CAN PROTECT ITS INTEREST. Purchaser represents that
by reason of its, or of its management's, business or financial experience,
Purchaser has the capacity to protect its own interests in connection with the
transactions contemplated in this Agreement. Further, Purchaser is aware of no
publication of any advertisement in connection with the transactions
contemplated in the Agreement.
(D) ACCREDITED INVESTOR. Purchaser represents that it is an
accredited investor within the meaning of Regulation D under the Securities Act.
(E) RULE 144. Purchaser acknowledges and agrees that the Shares
must be held indefinitely unless they are subsequently registered under the
Securities Act or an exemption from such registration is available. Purchaser
has been advised or is aware of the provisions of Rule 144 promulgated under the
Securities Act, which permits limited resale of shares purchased in a private
placement subject to the satisfaction of certain conditions, including, among
other things, the availability of certain current public information about the
Company, the resale occurring following the required holding period under Rule
144 and the number of shares being sold during any three-month period not
exceeding specified limitations.
(F) RESIDENCE. If the Purchaser is an individual, then the
Purchaser resides in the state or province identified in the address of the
Purchaser set forth on Exhibit A; if the Purchaser is a partnership,
corporation, limited liability company or other entity, then the office or
offices of the Purchaser in which its investment decision was made is located at
the address or addresses of the Purchaser set forth on Exhibit A.
4.3 TRANSFER RESTRICTIONS. Each Purchaser agrees that Purchaser shall
in no event make any disposition of all or any portion of the Shares unless and
until (i) there is then in effect
6.
<PAGE> 11
a registration statement under the Securities Act covering such proposed
disposition and such disposition is made in accordance with said registration
statement; or (ii) (A) Purchaser shall have notified the Company of the proposed
disposition and shall have furnished the Company with a detailed statement of
the circumstances surrounding the proposed disposition, (B) if requested by the
Company, Purchaser shall have furnished the Company with an opinion of
Purchaser's own counsel to the effect that such disposition will not require
registration of such Shares under the Securities Act and (C) such opinion of
Purchaser's counsel shall have been concurred in by counsel for the Company,
such concurrence not to be unreasonably withheld, and the Company shall have
advised Purchaser of such concurrence. Each Purchaser acknowledges and agrees
that all certificates representing the shares shall have endorsed thereon the
following legend
4.4 LEGEND. Each Purchaser acknowledges and agrees that all
certificates representing the Shares shall have endorsed thereon the following
legends:
(A) "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."
(B) Any legend required by appropriate state Blue Sky officials.
5. CONDITIONS TO CLOSING
5.1 CONDITIONS TO PURCHASERS' OBLIGATIONS AT THE CLOSING. Purchasers'
obligations to purchase the Shares at the Closing are subject to the
satisfaction, at or prior to the Closing, of the following conditions:
(A) REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE OF
OBLIGATIONS. The representations and warranties made by the Company in Section 3
hereof shall be true and correct in all material respects as of the Closing
Date.
(B) LEGAL INVESTMENT. On the Closing Date, the sale and issuance of
the Shares and the proposed issuance of the Shares shall be legally permitted by
all laws and regulations to which Purchasers and the Company are subject.
(C) CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained
any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the
Registration Rights Agreement (except for such as may be properly obtained
subsequent to the Closing).
(D) REGISTRATION RIGHTS AGREEMENT. A Registration Rights Agreement,
substantially in the form attached hereto as Exhibit C, shall have been executed
and delivered by the parties thereto.
7.
<PAGE> 12
(E) LEGAL OPINION. The Purchasers shall have received an opinion,
dated as of the Closing Date, from Cooley Godward LLP, legal counsel to the
Company, in the form attached hereto as Exhibit D.
(F) PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
in connection with the transactions contemplated at the Closing hereby and all
documents and instruments incident to such transactions shall be reasonably
satisfactory in substance and form to the Purchasers and their counsel, and the
Purchasers and their counsel shall have received all such counterpart originals
or certified or other copies of such documents as they may reasonably request.
5.2 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The Company's obligation
to issue and sell the Shares at the Closing is subject to the satisfaction, on
or prior to such Closing, of the following conditions:
(A) REPRESENTATIONS AND WARRANTIES TRUE. The representations and
warranties made by the Purchasers in Section 4 hereof shall be true and correct
in all material respects at the date of each Closing, with the same force and
effect as if they had been made on and as of said date.
(B) PERFORMANCE OF OBLIGATIONS. Purchasers shall have performed and
complied with all agreements and conditions herein required to be performed or
complied with by Purchasers on or before each Closing.
(C) REGISTRATION RIGHTS AGREEMENT. A Registration Rights Agreement,
substantially in the form attached hereto as Exhibit C, shall have been executed
and delivered by the Purchasers.
(D) CONSENTS, PERMITS, AND WAIVERS. The Company shall have obtained
any and all consents, permits and waivers necessary or appropriate for
consummation of the transactions contemplated by the Agreement and the
Investors' Rights Agreement (except for such as may be properly obtained
subsequent to the Closing).
6. MISCELLANEOUS
6.1 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of New York as such laws are applied to agreements between
New York residents entered into and performed entirely in New York, except that
the Delaware General Corporation Law will govern as to matters of corporate law.
6.2 SURVIVAL. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any Purchaser and the
closing of the transactions contemplated hereby. All statements as to factual
matters contained in any certificate or other instrument delivered by or on
behalf of the Company pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and warranties by the
Company hereunder solely as of the date of such certificate or instrument.
6.3 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs,
8.
<PAGE> 13
executors and administrators of the parties hereto and shall inure to the
benefit of and be enforceable by each person who shall be a holder of the Shares
from time to time.
6.4 ENTIRE AGREEMENT. This Agreement, the Exhibits hereto, including
the Registration Rights Agreement, and the other documents delivered pursuant
hereto constitute the full and entire understanding and agreement between the
parties with regard to the subjects hereof and no party shall be liable or bound
to any other in any manner by any representations, warranties, covenants and
agreements except as specifically set forth herein and therein.
6.5 SEVERABILITY. In case any provision of the Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
6.6 AMENDMENT AND WAIVER.
(A) This Agreement may be amended or modified only upon the written
consent of the Company and holders of a majority of the Shares (which have not
been sold to the public).
(B) The obligations of the Company and the rights of the holders of
the Shares under the Agreement may be waived only with the written consent of
the holders of a majority of the Shares (which have not been sold to the
public).
6.7 NOTICES. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the
party to be notified; (ii) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient, if not, then on the next business
day; (iii) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (iv) one (1) day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the
Company at the address as set forth on the signature page hereof and to
Purchaser at the address as set forth on Exhibit A hereto or at such other
address as the Company or Purchaser may designate by ten (10) days advance
written notice to the other parties hereto.
6.8 EXPENSES. The Company shall pay all costs and expenses that it
incurs with respect to the negotiation, execution, delivery and performance of
the Agreement.
6.9 ATTORNEYS' FEES. In the event that any dispute among the parties to
this Agreement should result in litigation, the prevailing party in such dispute
shall be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement, including without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.
6.10 TITLES AND SUBTITLES. The titles of the sections and subsections
of the Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
6.11 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
9.
<PAGE> 14
6.12 BROKER'S FEES. Each party hereto represents and warrants that
except for the fees payable to John G. Kinnard & Co.(which fees shall be the
sole responsibility of the Company), no agent, broker, investment banker, person
or firm acting on behalf of or under the authority of such party hereto is or
will be entitled to any broker's or finder's fee or any other commission
directly or indirectly in connection with the transactions contemplated herein.
Each party hereto further agrees to indemnify each other party for any claims,
losses or expenses incurred by such other party as a result of the
representation in this Section 6.12 being untrue.
6.13 EXCULPATION AMONG PURCHASERS. Each Purchaser acknowledges that it
is not relying upon any person, firm, or corporation, other than the Company and
its officers and directors, in making its investment or decision to invest in
the Company. Each Purchaser agrees that no Purchaser nor the respective
controlling persons, officers, directors, partners, agents, or employees of any
Purchaser shall be liable for any action heretofore or hereafter taken or
omitted to be taken by any of them in connection with the Shares.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
10.
<PAGE> 15
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
BOLDER TECHNOLOGIES CORPORATION
By:
---------------------------------------
Name: Daniel S. Lankford
Title: President and Chief Executive Officer
Accepted as of the date first above written:
PURCHASER
LEGAL NAME OF PURCHASER:
--------------------------------------------------------
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
Date:
------------------------------
11.
<PAGE> 1
EXHIBIT 10.4
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and
entered into as of May 14, 1999, by and among BOLDER Technologies Corporation, a
Delaware corporation (the "Company") and the persons listed on Exhibit A hereto
(the "Purchasers") with respect to the Purchase Agreement dated as of May 14,
1999 between the Company and the Purchasers (the "Purchase Agreement") for the
purchase of up to 1,500,000 shares of the Company's Common Stock (the "Common
Stock"). In order to induce the Purchasers to enter into the Purchase Agreement,
the Company has agreed to provide the registration rights set forth in this
Agreement. The execution of this Agreement is a condition to the closing under
the Purchase Agreement.
The Company agrees with the Purchasers, (i) for their benefit as
Purchasers and (ii) for the benefit of the holders from time to time of the
Common Stock (each of the foregoing a "Holder" and together the "Holders"), as
follows:
1. Definitions. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:
Affiliate: "Affiliate" means, with respect to any specified person, (i)
any other person directly or indirectly controlling or controlled by, or under
direct or indirect common control with, such specified person or (ii) any
officer or director of such other person. For purposes of this definition, the
term "control" (including the terms "controlling," "controlled by" and "under
common control with") of a person means the possession direct or indirect, of
the power (whether or not exercised) to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting
securities, by contract, or otherwise.
Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday that
is not a day on which banking institutions in the City of New York are
authorized or obligated by law or executive order to close.
Damages Accrual Period: See Section 2(d) hereof.
Damages Payment Date: The first business day of each month following
the Effectiveness Target Date.
Effectiveness Period: The period commencing with the date hereof and
ending on the earlier of the date that is two years after the later of the
initial date of original issuance of the Common Stock and the date that all
Registrable Securities have ceased to be Registrable Securities.
Effectiveness Target Date: See Section 2(a) hereof.
Event: See Section 2(d) hereof.
1.
<PAGE> 2
Event Date: See Section 2(d) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Filing Date: See Section 2(a) hereof.
Holder: See the second paragraph of this Agreement.
Initial Shelf Registration: See Section 2(a) hereof.
Liquidated Damages: See Section 2(d) hereof.
Losses: See Section 5 hereof.
Majority of Registrable Securities: A majority of the then outstanding
aggregate principal amount of Registrable Securities.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any amendment or prospectus supplement, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such Prospectus.
Purchase Agreement: See the first paragraph of this Agreement.
Record Holder: With respect to any Damages Payment Date relating to the
Common Stock, each Person who is a registered holder of Common Stock 15 days
prior to such Damages Payment Date.
Registrable Securities: The Common Stock issued pursuant to the
Purchase Agreement, and any Common Stock issued with respect thereto upon any
stock dividend, split or similar event, until (i) it is effectively registered
under the Securities Act and disposed of in accordance with the Registration
Statement covering it, (ii) it is salable by the holder thereof pursuant to Rule
144(k) or (iii) it is sold to the public pursuant to Rule 144, and, as a result
of the event or circumstance described in any of the foregoing clauses (i)
through (iii), the legends with respect to transfer restrictions required under
the Purchase Agreement (other than any such legends required solely as the
consequences or the fact that the Registrable Securities are owned by, or were
previously owned by, the Company or an Affiliate of the Company) are removed or
removable in accordance with the terms of the Purchase Agreement.
Registration Expenses: See Section 5 hereof.
Registration Statement: Any registration statement of the Company which
covers any of
2.
<PAGE> 3
the Registrable Securities pursuant to the provisions of this Agreement,
including the Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
Rule 144: Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulations hereafter adopted
by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations promulgated by the SEC thereunder.
Selling Holder: A Holder offering to sell Registrable Securities.
Shelf Registration: See Section 2(a) hereof.
Subsequent Shelf Registration: See Section 2(b) hereof.
Suspension Period: See Section 2(c).
2. Shelf Registration.
(a) The Company shall prepare and file with the SEC, as soon as
practicable but in any event on or prior to the date 30 days following the
latest date of original issuance of the Common Stock (the "Filing Date"), a
Registration Statement for an offering to be made on a continuous basis pursuant
to Rule 415 of the Securities Act (a "Shelf Registration") registering the
resale from time to time by Holders thereof of all of the Registrable Securities
(the "Initial Shelf Registration"). The Initial Shelf Registration shall be on
an appropriate SEC Registration Statement form permitting registration of such
Registrable Securities for resale by such Holders in the manner or manners
designated by them. The Company shall use its best efforts to cause the Initial
Shelf Registration to be declared effective under the Securities Act as soon as
practicable but in any event or prior to the date 90 days following the latest
date of original issuance of the Common Stock (the "Effectiveness Target Date"),
and shall use its best efforts to keep the Initial Shelf Registration
continuously effective under the Securities Act, subject to the provisions of
Section 2(c), until the earlier of the expiration of the Effectiveness Period or
the date a Subsequent Shelf Registration (as defined below) covering all of the
Registrable Securities has been declared effective under the Securities Act.
Subject to the right of the Company to have the Initial Shelf Registration not
be effective, or not to be updated, amended or supplemented, for periods of time
set forth in Section 2(c), the Company further agrees to use its best efforts to
prevent the happening of any event that would cause the Initial Shelf
Registration to contain a material misstatement or omission or to be not
effective and usable for resale of the Registrable Securities during the
Effective Period.
3.
<PAGE> 4
(b) If the Initial Shelf Registration or any subsequent Shelf
Registration ceases to be effective for any reason as a result of the issuance
of a stop order by the SEC at any time during the Effectiveness Period, the
Company shall use its best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 30 days of
such cessation of effectiveness amend the Shelf Registration in a manner
reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Shelf Registration covering all of
the Registrable Securities (a "Subsequent Shelf Registration"). If a Subsequent
Shelf Registration is filed, the Company shall use its best efforts to cause the
Subsequent Shelf Registration to be declared effective as soon as practicable
after such filing and to keep such Registration Statement continuously effective
until the end of the Effectiveness Period.
(c) In the event (A) of the happening of any event of the kind
described in Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v) or 3(c)(vi) hereof
or (B) that, in the good faith judgment of the Company, it is advisable to
suspend the use of the Prospectus for a discrete period of time due to pending
material corporate developments or similar material events that have not yet
been publicly disclosed and as to which the Company believes public disclosure
will be prejudicial to the Company, the Company shall deliver a certificate in
writing, signed by an authorized executive officer of the Company, to the
Purchasers, to the effect of the foregoing and thereafter the use of the
Prospectus shall be suspended, and the Company, subject to the terms of this
Section 2(c), shall thereafter not be required to maintain the effectiveness or
update the Shelf Registration. The Company will use its best efforts to ensure
that the use of the Prospectus may be resumed as soon as practicable, in the
case of suspension under Section 2(c)(A), and, in the case of a pending
development or event referred to in Section 2(c)(B) hereof, as soon as, in the
good faith judgment of the Company, public disclosure of such material corporate
development or similar material event would not have a material adverse effect
on the Company. Notwithstanding the foregoing, the Company shall not under any
circumstances be entitled to exercise its right under this Section 2(c) to
suspend the use of the Prospectus (whether as a result of events referred to in
Section 2(c)(A) hereof or as a result of the pending development or event
referred to in Section 2(c)(B) hereof) more than one (1) time in any three (3)
month period, and the periods in which the use of the Prospectus is suspended
shall not exceed 30 days in any three-month period (a "Suspension Period").
(d) The parties hereto agree that the Holders of Registrable Securities
will suffer damages, and that it would not be feasible to ascertain the extent
of such damages with precision, if the Initial Shelf Registration has not been
declared effective by the Effectiveness Target Date (an "Event," and the
Effectiveness Target Date being referred to herein as an "Event Date").
Notwithstanding the foregoing, the parties hereto agree that an Event shall be
deemed not to have occurred to the extent the parties mutually agree that the
direct, proximate cause of said Event was the act or failure to act of one or
more Holders. An Event shall be deemed to continue until the date of the
termination of such Event, which shall be the date the Initial Shelf
Registration is declared effective.
Accordingly, upon the occurrence of any Event and until such time
as there is no Event which has occurred and is continuing (a "Damages Accrual
Period"), commencing on the Event Date on which such Damages Accrual Period
began, the Company agrees to pay, as
4.
<PAGE> 5
liquidated damages, and not as a penalty, an additional amount (the "Liquidated
Damages") to each holder of shares of Common Stock that are Registrable
Securities, accruing at a rate equal to (i) 24% per annum during the first 30
days following the Effectiveness Target Date and (ii) 12% per annum thereafter,
multiplied by the aggregate purchase price paid by such holder for the number of
shares of Common Stock that are Registrable Securities held by such holder.
Notwithstanding the foregoing, no Liquidated Damages shall accrue as to any
Registrable Securities from and after the earlier of (x) the date such
securities are no longer Registrable Securities, and (y) the expiration of the
Effectiveness Period.
The Liquidated Damages shall be paid by the Company to the Holders
on each Damages Payment Date by wire transfer of immediately available funds to
the account specified by them or by mailing checks to their registered addresses
as they appear in the register of the Company for the Common Stock. Nothing
shall preclude a Holder of Registrable Securities from pursuing or obtaining
specific performance or other equitable relief with respect to this Agreement.
All of the Company's obligations set forth in this Section 2(d)
which are outstanding with respect to any Registrable Securities at the time
such security ceases to be a Registrable Security shall survive until such time
as all such obligations with respect to such security have been satisfied in
full (notwithstanding termination of the Agreement pursuant to Section 7(o)).
The parties hereto agree that the Liquidated Damages provided for in this
Section 2(d) constitute a reasonable estimate of the damages that may be
incurred by holders of Registrable Securities by reason of the failure of the
Shelf Registration to be declared effective in accordance with the provisions
hereof. The provisions of this Section 2(d) shall in no way be deemed to limit
the rights of the Holders to pursue all legal and equitable remedies and to
recovery full damages in the event of a breach of this Agreement by the Company.
In the event of such breach, the Holders shall be permitted to pursue all
remedies as provided for in Section 7(a) below.
3. Registration Procedures. In connection with the Company's
registration obligations under Section 2 hereof, the Company shall effect such
registrations to permit the sale of the Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant thereto
the Company shall as expeditiously as possible:
(a) Prepare and file with the SEC a Registration Statement or
Registration Statements on any appropriate form under the Securities Act
available for the sale of the Registrable Securities by the Holders thereof in
accordance with the intended method or methods of distribution thereof and shall
include all required financial statements, and use its best efforts to cause
each such Registration Statement to become effective and remain effective as
provided herein; provided, that before filing any such Registration Statement or
Prospectus or any amendments or supplements thereto the Company shall furnish
within a reasonable time period to each Selling Holder (if requested by such
Selling Holder) copies of all such documents proposed to be filed, which
documents will be subject to the review of each Selling Holder (if requested by
such Selling Holder), and the Company shall not file any such Registration
Statement or amendment thereto or any Prospectus or any supplement thereto to
which the Holders of a Majority of Registrable Securities covered by such
Registration Statement shall
5.
<PAGE> 6
reasonably object in writing within five Business Days after the receipt
thereof.
(b) Subject to Section 2(c), prepare and file with the SEC such
amendments and post-effective amendments to each Registration Statement as may
be necessary to keep such Registration Statement continuously effective for the
applicable period specified in Section 2; cause the related Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act and comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such Registration Statement
during the applicable period in accordance with the intended methods or
disposition by the sellers thereof set forth in such Registration Statement as
so amended or such Prospectus as so supplemented. The Company shall ensure that
(i) any Shelf Registration and any amendment thereto and any Prospectus forming
a part thereof and any amendment or supplement thereto complies in all material
respects with the Act and the rules and regulations thereunder, (ii) any Shelf
Registration and any amendment thereto does not, when it becomes effective,
contain 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, in
light of the circumstances under which they were made, not misleading and (iii)
any Prospectus forming part of any Shelf Registration, and any amendment or
supplement to such Prospectus, does not include an untrue statement or a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(c) Notify the Holders and (if requested by any such person) confirm
such notice in writing, (i) when a Prospectus, any Prospectus supplement, a
Registration Statement or a post-effective amendment to a Registration Statement
has been filed with the SEC, and, with respect to a Registration Statement or
any post-effective amendment, when the same has become effective; (ii) of any
request by the SEC or any other federal or state governmental authority for
amendments or supplements to a Registration Statement or related Prospectus or
for additional information, (iii) of the issuance by the SEC or any other
federal or state governmental authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation or threatening of
any proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceedings for such
purpose, (v) of the existence of any fact or happening of any event which makes
any statement of a material fact in such Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue or which would require the making of any changes in the
Registration Statement or Prospectus in order that, in the case of the
Registration Statement, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and that in the case of
the Prospectus, it will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, and (vi) of the Company's determination that a
post-effective amendment to a Registration Statement would be appropriate.
6.
<PAGE> 7
(d) Use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement, or the lifting of any
suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest possible
moment.
(e) If requested by the Holders of a Majority of the Registrable
Securities being sold, (i) promptly incorporate in a Prospectus supplement or
post-effective amendment to Registration Statement such information as such
Holders and the Company agree should be included therein, and (ii) make all
required filings of such Prospectus supplement or such post-effective amendment
as soon as practicable after the Company has received notification of the
matters proposed to be incorporated in such Prospectus supplement or
post-effective amendment.
(f) Furnish to each Selling Holder (if requested by such Selling
Holder), without charge, at least one conformed copy of the Registration
Statement or Statements and any amendment thereto, including financial
statements but excluding schedules, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.
(g) Deliver to each Selling Holder in connection with any offering of
Registrable Securities, without charge, as many copies of the Prospectus or
Prospectuses relating to such Registrable Securities (including each preliminary
prospectus) and any amendment or supplement thereto as such persons may
reasonably request; and the Company hereby consents to the use of such
Prospectus or each amendment or supplement thereto by each of the Selling
Holders of Registrable Securities and the Underwriters, if any, in connection
with any offering and sale of the Registrable Securities covered by such
Prospectus or any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities, to register
or qualify or cooperate with the Selling Holders in connection with any
registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States as
any Selling Holder reasonably requests in writing, keep each such registration
or qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective and do any and all other
acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the applicable
Registration Statement, provided, that the Company will not be required to (i)
qualify generally to do business in any jurisdiction where it is not then so
qualified (ii) take any action that would subject it to general service of
process in suits or to taxation in any such jurisdiction where it is not then so
subject.
(i) Cause the Registrable Securities covered by the applicable
Registration Statement to be registered with or approved by such other
governmental agencies in addition to the SEC or authorities within the United
States as may be necessary to enable the Selling Holder or Holders thereof to
consummate the disposition of such Registrable Securities.
7.
<PAGE> 8
(j) During the Effectiveness Period (subject to the provisions of
Section 2(c)), immediately upon the existence of any fact or the occurrence of
any event as a result of which a Registration Statement shall contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or a Prospectus shall
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
promptly prepare and file a post-effective amendment to each Registration
Statement or a supplement to the related Prospectus or any document incorporated
therein by reference or file any other required document (such as a Current
Report on Form 8-K) that would be incorporated by reference into the
Registration Statement so that the Registration Statement shall not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading,
in light of the circumstances under which they were made, and so that the
Prospectus will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, and in the case of a
post-effective amendment to a Registration Statement use its best efforts to
cause it to become effective as soon as practicable.
(k) Enter into such agreements and take all such other actions in
connection therewith in order to expedite or facilitate the disposition of such
Registrable Securities and in such connection, whether or not an underwriting
agreement is entered into.
(l) Make available for inspection by a representative of the Holders of
Registrable Securities being sold and any attorney or accountant retained by
such Selling Holders or underwriter, financial and other records, pertinent
corporate documents and properties of the Company and its subsidiaries, and
cause the executive officers, directors and employees of the Company and its
subsidiaries to supply all information reasonably requested by any such
representative, attorney or accountant in connection with such disposition;
provided, however, that any information that is reasonably and in good faith
designated by the Company in writing as confidential at the time of delivery of
such information shall be kept confidential by such persons, unless (i)
disclosure of such information is required by court or administrative order or
is necessary to respond to inquiries of regulatory authorities, (ii) disclosure
of such information is required by law (including any disclosure requirements
pursuant to federal securities laws in connection with the filing of any
Registration Statement or the use of any prospectus referred to in this
Agreement), (iii) such information becomes generally available to the public
other than as a result of disclosure or failure to safeguard by any such person
or (iv) such information becomes available to any such person from a source
other than the Company and such source is not bound by a confidentiality
agreement.
(m) Comply with all applicable rules and regulations of the SEC in all
material respects and make generally available to its securityholders earning
statements (which need not be audited) satisfying the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act) no later than 45 days after the end of any
12-month period (or 90 days after the end of any 12-month period if such period
8.
<PAGE> 9
is a fiscal year) (i) commencing at the end of any fiscal quarter in which
Registrable Securities are sold to underwriters in firm commitment or best
efforts underwritten offering and (ii) if not sold to underwriters in such an
offering, commencing on the first day of the first fiscal quarter of the Company
commencing after the effective date of a Registration Statement, which
statements shall cover said 12-month periods.
(n) Cooperate with the Selling Holders of Registrable Securities to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends; and
enable such Registrable Securities to be in such denominations and registered in
such names as the Holders may request.
(o) Not later than the effectiveness date of any Registration Statement
hereunder, provide a CUSIP number for the Registrable Securities registered
under such Registration Statement, and provide the transfer agent for the Common
Stock with printed certificates for the Registrable Securities which are in a
form eligible for deposit with The Depository Trust Company.
(p) Cause all shares of Common Stock covered by the Registration
Statement to be listed or quoted on, each securities exchange or quotation
system on which the Company's Common Stock is then listed or quoted no later
than the date the Registration Statement is declared effective, and, in
connection therewith, to the extent applicable, to make such filings under the
Exchange Act (e.g., the filing of a Registration Statement on Form 8-A) and to
have such filings declared effective thereunder.
(q) Cooperate and assist in any filing required to be made with the
National Association of Securities Dealers, Inc.
The Company may require each Holder of securities to be sold pursuant
to any Registration Statement to furnish to the Company such information
regarding the Holder and the distribution of such securities as the Company may
from time to time reasonably require for inclusion in such Registration
Statement. Any Holder who fails to provide such information shall not be
entitled to use the Prospectus.
4. Registration Expenses. All fees and expenses incident to the
Company's obligations under this Agreement shall be borne by the Company whether
or not any of the Registration Statements become effective. Such fees and
expenses shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses with respect to filings
required to be made with the National Association of Securities Dealers, Inc.),
(ii) printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities in a form eligible for deposit with The
Depository Trust Company, (iii) reasonable fees and disbursements of counsel for
the Company in connection with the Shelf Registration, and (iv) fees and
disbursements of all independent certified public accountants referred to in
Section 3(k)(iii) hereof (including the expenses of any special audit and "cold
comfort" letters required by or incident to such performance). In addition, the
Company shall pay the fees and expenses incurred in connection with the listing
or quotation of the securities to be registered on any securities exchange or
quotations system on which similar securities issued by
9.
<PAGE> 10
the Company are then listed and the fees and expenses of any person, including
special experts, retained by the Company.
5. Indemnification.
(a) Indemnification by the Company. The Company shall indemnify and
hold harmless each Holder, the directors, officers and employees of each such
Holder and each person, if any, who controls any such Holder (within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act)
from and against all losses, liabilities, damages and expenses (including
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim)
(collectively, "Losses"), arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement or Prospectus or in any amendment or supplement thereto, 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 not misleading, in light of the circumstances under which they were
made, except insofar as such Losses arise out of or are based upon the
information relating to any Holder furnished to the Company in writing by any
Holder expressly for use therein. The Company shall also indemnify each
underwriter, their officers and directors, and each person who controls such
person (within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent and with the same limitations as provided
above with respect to the indemnification of the Holders or Registrable
Securities.
(b) Indemnification by Holder of Registrable Securities. Each Holder,
agrees severally and not jointly to indemnify and hold harmless the Company, its
directors, its officers who sign a Registration Statement and each person, if
any, who controls the Company (within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act), from and against all losses
arising out of or based upon any untrue statement of a material fact contained
in any Registration Statement, Prospectus or arising out of or based upon any
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, in light of the circumstances under which
they were made, to the extent, but only to the extent, that such untrue
statement or omission is contained in any information relating to such Holder so
furnished in writing by such Holder to the Company expressly for use in such
Registration Statement or Prospectus. In no event shall the liability of any
Selling Holder of Registrable Securities hereunder be greater in amount than the
dollar amount of the proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. In case any proceeding
(including any governmental investigation) shall be instituted involving any
person in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person (the "indemnified party") shall promptly
notify the person against whom such indemnity may be sought (the "indemnifying
party") in writing, but failure so to notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof. The indemnifying party, upon
request of the indemnified party, shall retain counsel satisfactory to the
indemnified party to represent the indemnified party and
10.
<PAGE> 11
any others the indemnifying party may designate in such proceeding and shall pay
the fees and disbursements of such counsel related to such proceeding. In any
such proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention to such counsel, (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them, or (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action. It is understood that the indemnifying party shall not, in respect of
the legal expenses or any indemnified party in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
all indemnified parties under Section 5(a) or 5(b) hereof who are parties to
such proceeding or proceedings, and that all such fees and expenses shall be
reimbursed as they are incurred. The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in this Section 5
is unavailable (other than by reason of the exceptions set forth herein) to an
indemnified party under Section 5(a) or 5(b) hereof in respect of any Losses or
is insufficient to hold such indemnified party harmless, then each applicable
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, (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the initial placement of the Common Stock pursuant to the Purchase
Agreement. Benefits received by the Holders shall be deemed to be equal to the
value of receiving the Common Stock registered under the Securities Act.
Benefits received by any underwriter shall be deemed to be equal to the total
underwriting discounts and commissions, as set forth on the cover page of the
Prospectus forming a part of the Registration Statement which resulted in such
Losses. The relative fault of the Holders on the one hand and the Company on the
other hand 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
11.
<PAGE> 12
information supplied by the Holders or by the Company and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Holders' respective obligations to contribute
pursuant to this paragraph are several in proportion to the respective number of
Registrable Securities they have sold pursuant to a Registration Statement, and
not joint.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method or allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the Losses
referred to in the immediately preceding paragraph 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. Notwithstanding this Section 5(d), an
indemnifying party that is a Selling Holder of Registrable Securities shall not
be required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities sold by such indemnifying party and
distributed to the public were offered to the public exceeds the amount of any
damages which such indemnifying party 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.
The indemnity, contribution and expense reimbursement obligations of
the Company hereunder shall be in addition to any liability the Company may
otherwise have hereunder, under the Purchase Agreement or otherwise.
The indemnity and contribution provisions contained in this Section 5
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Holder or any person controlling any Holder, or the Company, its officers or
directors or any person controlling the Company and (iii) the sale of any
Registrable Securities by any Holder.
6. Information Requirements.
(a) The Company shall file the reports required to be filed by it under
the Securities Act and the Exchange Act, and if at any time the Company is not
required to file such reports, it will, upon the request of any Holder of
Registrable Securities, make publicly available other information so long as
necessary to permit sales pursuant to Rule 144 under the Securities Act. The
Company further covenants that it will cooperate with any Holder of Registrable
Securities and take such further reasonable action as any Holder of Registrable
Securities may reasonably request (including, without limitation, making such
reasonable representations as any such Holder may reasonably request), all to
the extent required from time to time to enable such Holder to sell Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144 under the Securities Act. Notwithstanding
the foregoing, nothing in this Section 6 shall be deemed to require the Company
to register any of its securities under any section of the Exchange Act.
12.
<PAGE> 13
(b) The Company shall file the reports required to be filed by it under
the Exchange Act and shall comply with all other requirements set forth in the
instructions to the appropriate SEC Registration Statement form permitting
registration of the Registrable Securities for resale by the Holders thereof in
the manner or manners designated by them.
7. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, each Holder of Registrable Securities, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason or a breach by it of any
of the provisions of this Agreement and hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate.
(b) No Conflicting Agreements. The Company has not entered, as of the
date hereof and shall not, on or after the date of this Agreement, enter into
any agreement with respect to its securities which conflicts with the rights
granted to the Holders of Registrable Securities in this Agreement. The Company
represents and warrants that the rights granted to the Holders of Registrable
Securities hereunder do not in any way conflict with the rights granted to the
holders of the Company's securities under any other agreements.
(c) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of Holders of a
Majority of the then outstanding Registrable Securities. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of holders of Registrable
Securities whose securities are being sold pursuant to a Registration Statement
and that does not directly or indirectly affect the rights of other Holders of
Registrable Securities may be given by Holders of at least a majority of the
Registrable Securities being sold by such Holders; provided, that the provisions
of this sentence may not be amended, modified, or supplemented except in
accordance with the provisions of the immediately preceding sentence.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing and shall be deemed given (i) when
made, if made by hand delivery, (ii) upon confirmation, if made by telecopier or
(iii) one business day after being deposited with a reputable next-day courier,
postage prepaid, to the parties as follows:
(x) if to a holder of Registrable Securities, at the most
current address given by such holder to the Company in accordance with
the provisions of Section 7(e):
13.
<PAGE> 14
and
(y) if to the Company, to:
BOLDER Technologies Corporation
4403 Table Mountain Drive
Golden, Colorado 80403
Attention: Daniel S. Lankford
Telecopy No.: (303) 215-7200
with a copy to:
Cooley Godward LLP
2595 Canyon Blvd., Suite 250
Boulder, Colorado 80302
Attention: James H. Carroll
Telecopy No.: (303) 546-4099
or to such other address as such person may have furnished to the other persons
identified in this Section 7(d) in writing in accordance herewith.
(e) Owner of Registrable Securities. The Company will maintain, or will
cause its registrar and transfer agent to maintain, a register with respect to
the Registrable Securities in which all transfers of Registrable Securities of
which the Company has received notice will be recorded. The Company may deem and
treat the person in whose name Registrable Securities are registered in such
register of the Company as the owner thereof for all purposes, including,
without limitation, the giving of notices under this Agreement.
(f) Approval of Holders. Whenever the consent or approval of Holders of
a specified percentage of Registrable Securities is required hereunder,
Registrable Securities held by the Company or its affiliates (as such term is
defined in Rule 405 under the Securities Act) (other than the Purchasers or
subsequent holders of Registrable Securities if such subsequent holders are
deemed to be such affiliates solely by reason of their holdings of such
Registrable Securities) shall not be counted in determining whether such consent
or approval was given by the Holders of such required percentage.
(g) Successors and Assigns. The Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties and shall
inure to the benefit of and be binding upon each holder of any Registrable
Securities.
(h) 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 original and all of which taken together
shall constitute one and the same agreement.
14.
<PAGE> 15
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS BY
THE LAWS OF THE STATE OF NEW YORK AS SUCH LAWS ARE APPLIED TO AGREEMENTS BETWEEN
NEW YORK RESIDENTS ENTERED INTO AND PERFORMED ENTIRELY IN NEW YORK, EXCEPT THAT
THE DELAWARE GENERAL CORPORATION LAW WILL GOVERN AS TO MATTERS OF CORPORATE LAW.
(k) Severability. If any term, provision, covenant or restriction of
this Agreement is held to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect, and shall in no way be affected, impaired
or invalidated thereby, and the parties hereto shall use their best efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions without including any of such which may be hereafter declared
invalid, illegal, void or unenforceable.
(l) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and is 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. Except as provided in the
Purchase Agreement, 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 securities
sold pursuant to the Purchase Agreement. This Agreement supersedes all prior
agreements and understandings among the parties with respect to such subject
matter.
(m) Attorneys' Fees. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party, as determined by the court, shall be
entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
(n) Further Assurances. Each of the parties hereto shall use all
reasonable efforts to take, or cause to be taken, all appropriate action, do or
cause to be done all things reasonably necessary, proper or advisable under
applicable law, and execute and deliver such documents and other papers, as may
be required to carry out the provisions of this Agreement and the other
documents contemplated hereby and consummate the make effective the transactions
contemplated hereby.
(o) Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the end of the Effectiveness Period, except for
any liabilities or obligations under Sections 4 or 5 hereof, each of which shall
remain in effect in accordance with their terms.
15.
<PAGE> 16
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
BOLDER TECHNOLOGIES CORPORATION
By:
---------------------------------------
Name: Daniel S. Lankford
Title: President and Chief Executive Officer
Accepted as of the date first above written:
PURCHASER
LEGAL NAME OF PURCHASER:
--------------------------------------------------------
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
Date:
------------------------------
16.
<PAGE> 1
EXHIBIT 10.5
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and
entered into as of May 18, 1999, by and among BOLDER Technologies Corporation, a
Delaware corporation (the "Company") and the persons listed on Exhibit A hereto
(the "Purchasers") with respect to the Purchase Agreement dated as of May 18,
1999 between the Company and the Purchasers (the "Purchase Agreement") for the
purchase of up to 1,500,000 shares of the Company's Common Stock (the "Common
Stock"). In order to induce the Purchasers to enter into the Purchase Agreement,
the Company has agreed to provide the registration rights set forth in this
Agreement. The execution of this Agreement is a condition to the closing under
the Purchase Agreement.
The Company agrees with the Purchasers, (i) for their benefit as
Purchasers and (ii) for the benefit of the holders from time to time of the
Common Stock (each of the foregoing a "Holder" and together the "Holders"), as
follows:
1. Definitions. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:
Affiliate: "Affiliate" means, with respect to any specified person, (i)
any other person directly or indirectly controlling or controlled by, or under
direct or indirect common control with, such specified person or (ii) any
officer or director of such other person. For purposes of this definition, the
term "control" (including the terms "controlling," "controlled by" and "under
common control with") of a person means the possession direct or indirect, of
the power (whether or not exercised) to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting
securities, by contract, or otherwise.
Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday that
is not a day on which banking institutions in the City of New York are
authorized or obligated by law or executive order to close.
Damages Accrual Period: See Section 2(d) hereof.
Damages Payment Date: The first business day of each month following
the Effectiveness Target Date.
Effectiveness Period: The period commencing with the date hereof and
ending on the earlier of the date that is two years after the later of the
initial date of original issuance of the Common Stock and the date that all
Registrable Securities have ceased to be Registrable Securities.
Effectiveness Target Date: See Section 2(a) hereof.
Event: See Section 2(d) hereof.
1.
<PAGE> 2
Event Date: See Section 2(d) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Filing Date: See Section 2(a) hereof.
Holder: See the second paragraph of this Agreement.
Initial Shelf Registration: See Section 2(a) hereof.
Liquidated Damages: See Section 2(d) hereof.
Losses: See Section 5 hereof.
Majority of Registrable Securities: A majority of the then outstanding
aggregate principal amount of Registrable Securities.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any amendment or prospectus supplement, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such Prospectus.
Purchase Agreement: See the first paragraph of this Agreement.
Record Holder: With respect to any Damages Payment Date relating to the
Common Stock, each Person who is a registered holder of Common Stock 15 days
prior to such Damages Payment Date.
Registrable Securities: The Common Stock issued pursuant to the
Purchase Agreement, and any Common Stock issued with respect thereto upon any
stock dividend, split or similar event, until (i) it is effectively registered
under the Securities Act and disposed of in accordance with the Registration
Statement covering it, (ii) it is salable by the holder thereof pursuant to Rule
144(k) or (iii) it is sold to the public pursuant to Rule 144, and, as a result
of the event or circumstance described in any of the foregoing clauses (i)
through (iii), the legends with respect to transfer restrictions required under
the Purchase Agreement (other than any such legends required solely as the
consequences or the fact that the Registrable Securities are owned by, or were
previously owned by, the Company or an Affiliate of the Company) are removed or
removable in accordance with the terms of the Purchase Agreement.
Registration Expenses: See Section 5 hereof.
Registration Statement: Any registration statement of the Company which
covers any of
2.
<PAGE> 3
the Registrable Securities pursuant to the provisions of this Agreement,
including the Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
Rule 144: Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulations hereafter adopted
by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations promulgated by the SEC thereunder.
Selling Holder: A Holder offering to sell Registrable Securities.
Shelf Registration: See Section 2(a) hereof.
Subsequent Shelf Registration: See Section 2(b) hereof.
Suspension Period: See Section 2(c).
2. Shelf Registration.
(a) The Company shall prepare and file with the SEC, as soon as
practicable but in any event on or prior to the date 30 days following the
latest date of original issuance of the Common Stock (the "Filing Date"), a
Registration Statement for an offering to be made on a continuous basis pursuant
to Rule 415 of the Securities Act (a "Shelf Registration") registering the
resale from time to time by Holders thereof of all of the Registrable Securities
(the "Initial Shelf Registration"). The Initial Shelf Registration shall be on
an appropriate SEC Registration Statement form permitting registration of such
Registrable Securities for resale by such Holders in the manner or manners
designated by them. The Company shall use its best efforts to cause the Initial
Shelf Registration to be declared effective under the Securities Act as soon as
practicable but in any event or prior to the date 90 days following the latest
date of original issuance of the Common Stock (the "Effectiveness Target Date"),
and shall use its best efforts to keep the Initial Shelf Registration
continuously effective under the Securities Act, subject to the provisions of
Section 2(c), until the earlier of the expiration of the Effectiveness Period or
the date a Subsequent Shelf Registration (as defined below) covering all of the
Registrable Securities has been declared effective under the Securities Act.
Subject to the right of the Company to have the Initial Shelf Registration not
be effective, or not to be updated, amended or supplemented, for periods of time
set forth in Section 2(c), the Company further agrees to use its best efforts to
prevent the happening of any event that would cause the Initial Shelf
Registration to contain a material misstatement or omission or to be not
effective and usable for resale of the Registrable Securities during the
Effective Period.
3.
<PAGE> 4
(b) If the Initial Shelf Registration or any subsequent Shelf
Registration ceases to be effective for any reason as a result of the issuance
of a stop order by the SEC at any time during the Effectiveness Period, the
Company shall use its best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 30 days of
such cessation of effectiveness amend the Shelf Registration in a manner
reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Shelf Registration covering all of
the Registrable Securities (a "Subsequent Shelf Registration"). If a Subsequent
Shelf Registration is filed, the Company shall use its best efforts to cause the
Subsequent Shelf Registration to be declared effective as soon as practicable
after such filing and to keep such Registration Statement continuously effective
until the end of the Effectiveness Period.
(c) In the event (A) of the happening of any event of the kind
described in Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v) or 3(c)(vi) hereof
or (B) that, in the good faith judgment of the Company, it is advisable to
suspend the use of the Prospectus for a discrete period of time due to pending
material corporate developments or similar material events that have not yet
been publicly disclosed and as to which the Company believes public disclosure
will be prejudicial to the Company, the Company shall deliver a certificate in
writing, signed by an authorized executive officer of the Company, to the
Purchasers, to the effect of the foregoing and thereafter the use of the
Prospectus shall be suspended, and the Company, subject to the terms of this
Section 2(c), shall thereafter not be required to maintain the effectiveness or
update the Shelf Registration. The Company will use its best efforts to ensure
that the use of the Prospectus may be resumed as soon as practicable, in the
case of suspension under Section 2(c)(A), and, in the case of a pending
development or event referred to in Section 2(c)(B) hereof, as soon as, in the
good faith judgment of the Company, public disclosure of such material corporate
development or similar material event would not have a material adverse effect
on the Company. Notwithstanding the foregoing, the Company shall not under any
circumstances be entitled to exercise its right under this Section 2(c) to
suspend the use of the Prospectus (whether as a result of events referred to in
Section 2(c)(A) hereof or as a result of the pending development or event
referred to in Section 2(c)(B) hereof) more than one (1) time in any three (3)
month period, and the periods in which the use of the Prospectus is suspended
shall not exceed 30 days in any three-month period (a "Suspension Period").
(d) The parties hereto agree that the Holders of Registrable Securities
will suffer damages, and that it would not be feasible to ascertain the extent
of such damages with precision, if the Initial Shelf Registration has not been
declared effective by the Effectiveness Target Date (an "Event," and the
Effectiveness Target Date being referred to herein as an "Event Date").
Notwithstanding the foregoing, the parties hereto agree that an Event shall be
deemed not to have occurred to the extent the parties mutually agree that the
direct, proximate cause of said Event was the act or failure to act of one or
more Holders. An Event shall be deemed to continue until the date of the
termination of such Event, which shall be the date the Initial Shelf
Registration is declared effective.
Accordingly, upon the occurrence of any Event and until such time
as there is no Event which has occurred and is continuing (a "Damages Accrual
Period"), commencing on the Event Date on which such Damages Accrual Period
began, the Company agrees to pay, as
4.
<PAGE> 5
liquidated damages, and not as a penalty, an additional amount (the "Liquidated
Damages") to each holder of shares of Common Stock that are Registrable
Securities, accruing at a rate equal to (i) 24% per annum during the first 30
days following the Effectiveness Target Date and (ii) 12% per annum thereafter,
multiplied by the aggregate purchase price paid by such holder for the number of
shares of Common Stock that are Registrable Securities held by such holder.
Notwithstanding the foregoing, no Liquidated Damages shall accrue as to any
Registrable Securities from and after the earlier of (x) the date such
securities are no longer Registrable Securities, and (y) the expiration of the
Effectiveness Period.
The Liquidated Damages shall be paid by the Company to the Holders
on each Damages Payment Date by wire transfer of immediately available funds to
the account specified by them or by mailing checks to their registered addresses
as they appear in the register of the Company for the Common Stock. Nothing
shall preclude a Holder of Registrable Securities from pursuing or obtaining
specific performance or other equitable relief with respect to this Agreement.
All of the Company's obligations set forth in this Section 2(d)
which are outstanding with respect to any Registrable Securities at the time
such security ceases to be a Registrable Security shall survive until such time
as all such obligations with respect to such security have been satisfied in
full (notwithstanding termination of the Agreement pursuant to Section 7(o)).
The parties hereto agree that the Liquidated Damages provided for in this
Section 2(d) constitute a reasonable estimate of the damages that may be
incurred by holders of Registrable Securities by reason of the failure of the
Shelf Registration to be declared effective in accordance with the provisions
hereof. The provisions of this Section 2(d) shall in no way be deemed to limit
the rights of the Holders to pursue all legal and equitable remedies and to
recovery full damages in the event of a breach of this Agreement by the Company.
In the event of such breach, the Holders shall be permitted to pursue all
remedies as provided for in Section 7(a) below.
3. Registration Procedures. In connection with the Company's
registration obligations under Section 2 hereof, the Company shall effect such
registrations to permit the sale of the Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant thereto
the Company shall as expeditiously as possible:
(a) Prepare and file with the SEC a Registration Statement or
Registration Statements on any appropriate form under the Securities Act
available for the sale of the Registrable Securities by the Holders thereof in
accordance with the intended method or methods of distribution thereof and shall
include all required financial statements, and use its best efforts to cause
each such Registration Statement to become effective and remain effective as
provided herein; provided, that before filing any such Registration Statement or
Prospectus or any amendments or supplements thereto the Company shall furnish
within a reasonable time period to each Selling Holder (if requested by such
Selling Holder) copies of all such documents proposed to be filed, which
documents will be subject to the review of each Selling Holder (if requested by
such Selling Holder), and the Company shall not file any such Registration
Statement or amendment thereto or any Prospectus or any supplement thereto to
which the Holders of a Majority of Registrable Securities covered by such
Registration Statement shall
5.
<PAGE> 6
reasonably object in writing within five Business Days after the receipt
thereof.
(b) Subject to Section 2(c), prepare and file with the SEC such
amendments and post-effective amendments to each Registration Statement as may
be necessary to keep such Registration Statement continuously effective for the
applicable period specified in Section 2; cause the related Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act and comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such Registration Statement
during the applicable period in accordance with the intended methods or
disposition by the sellers thereof set forth in such Registration Statement as
so amended or such Prospectus as so supplemented. The Company shall ensure that
(i) any Shelf Registration and any amendment thereto and any Prospectus forming
a part thereof and any amendment or supplement thereto complies in all material
respects with the Act and the rules and regulations thereunder, (ii) any Shelf
Registration and any amendment thereto does not, when it becomes effective,
contain 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, in
light of the circumstances under which they were made, not misleading and (iii)
any Prospectus forming part of any Shelf Registration, and any amendment or
supplement to such Prospectus, does not include an untrue statement or a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(c) Notify the Holders and (if requested by any such person) confirm
such notice in writing, (i) when a Prospectus, any Prospectus supplement, a
Registration Statement or a post-effective amendment to a Registration Statement
has been filed with the SEC, and, with respect to a Registration Statement or
any post-effective amendment, when the same has become effective; (ii) of any
request by the SEC or any other federal or state governmental authority for
amendments or supplements to a Registration Statement or related Prospectus or
for additional information, (iii) of the issuance by the SEC or any other
federal or state governmental authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation or threatening of
any proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceedings for such
purpose, (v) of the existence of any fact or happening of any event which makes
any statement of a material fact in such Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue or which would require the making of any changes in the
Registration Statement or Prospectus in order that, in the case of the
Registration Statement, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and that in the case of
the Prospectus, it will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, and (vi) of the Company's determination that a
post-effective amendment to a Registration Statement would be appropriate.
6.
<PAGE> 7
(d) Use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement, or the lifting of any
suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest possible
moment.
(e) If requested by the Holders of a Majority of the Registrable
Securities being sold, (i) promptly incorporate in a Prospectus supplement or
post-effective amendment to Registration Statement such information as such
Holders and the Company agree should be included therein, and (ii) make all
required filings of such Prospectus supplement or such post-effective amendment
as soon as practicable after the Company has received notification of the
matters proposed to be incorporated in such Prospectus supplement or
post-effective amendment.
(f) Furnish to each Selling Holder (if requested by such Selling
Holder), without charge, at least one conformed copy of the Registration
Statement or Statements and any amendment thereto, including financial
statements but excluding schedules, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.
(g) Deliver to each Selling Holder in connection with any offering of
Registrable Securities, without charge, as many copies of the Prospectus or
Prospectuses relating to such Registrable Securities (including each preliminary
prospectus) and any amendment or supplement thereto as such persons may
reasonably request; and the Company hereby consents to the use of such
Prospectus or each amendment or supplement thereto by each of the Selling
Holders of Registrable Securities and the Underwriters, if any, in connection
with any offering and sale of the Registrable Securities covered by such
Prospectus or any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities, to register
or qualify or cooperate with the Selling Holders in connection with any
registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States as
any Selling Holder reasonably requests in writing, keep each such registration
or qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective and do any and all other
acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the applicable
Registration Statement, provided, that the Company will not be required to (i)
qualify generally to do business in any jurisdiction where it is not then so
qualified (ii) take any action that would subject it to general service of
process in suits or to taxation in any such jurisdiction where it is not then so
subject.
(i) Cause the Registrable Securities covered by the applicable
Registration Statement to be registered with or approved by such other
governmental agencies in addition to the SEC or authorities within the United
States as may be necessary to enable the Selling Holder or Holders thereof to
consummate the disposition of such Registrable Securities.
7.
<PAGE> 8
(j) During the Effectiveness Period (subject to the provisions of
Section 2(c)), immediately upon the existence of any fact or the occurrence of
any event as a result of which a Registration Statement shall contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or a Prospectus shall
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
promptly prepare and file a post-effective amendment to each Registration
Statement or a supplement to the related Prospectus or any document incorporated
therein by reference or file any other required document (such as a Current
Report on Form 8-K) that would be incorporated by reference into the
Registration Statement so that the Registration Statement shall not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading,
in light of the circumstances under which they were made, and so that the
Prospectus will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, and in the case of a
post-effective amendment to a Registration Statement use its best efforts to
cause it to become effective as soon as practicable.
(k) Enter into such agreements and take all such other actions in
connection therewith in order to expedite or facilitate the disposition of such
Registrable Securities and in such connection, whether or not an underwriting
agreement is entered into.
(l) Make available for inspection by a representative of the Holders of
Registrable Securities being sold and any attorney or accountant retained by
such Selling Holders or underwriter, financial and other records, pertinent
corporate documents and properties of the Company and its subsidiaries, and
cause the executive officers, directors and employees of the Company and its
subsidiaries to supply all information reasonably requested by any such
representative, attorney or accountant in connection with such disposition;
provided, however, that any information that is reasonably and in good faith
designated by the Company in writing as confidential at the time of delivery of
such information shall be kept confidential by such persons, unless (i)
disclosure of such information is required by court or administrative order or
is necessary to respond to inquiries of regulatory authorities, (ii) disclosure
of such information is required by law (including any disclosure requirements
pursuant to federal securities laws in connection with the filing of any
Registration Statement or the use of any prospectus referred to in this
Agreement), (iii) such information becomes generally available to the public
other than as a result of disclosure or failure to safeguard by any such person
or (iv) such information becomes available to any such person from a source
other than the Company and such source is not bound by a confidentiality
agreement.
(m) Comply with all applicable rules and regulations of the SEC in all
material respects and make generally available to its securityholders earning
statements (which need not be audited) satisfying the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act) no later than 45 days after the end of any
12-month period (or 90 days after the end of any 12-month period if such period
8.
<PAGE> 9
is a fiscal year) (i) commencing at the end of any fiscal quarter in which
Registrable Securities are sold to underwriters in firm commitment or best
efforts underwritten offering and (ii) if not sold to underwriters in such an
offering, commencing on the first day of the first fiscal quarter of the Company
commencing after the effective date of a Registration Statement, which
statements shall cover said 12-month periods.
(n) Cooperate with the Selling Holders of Registrable Securities to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends; and
enable such Registrable Securities to be in such denominations and registered in
such names as the Holders may request.
(o) Not later than the effectiveness date of any Registration Statement
hereunder, provide a CUSIP number for the Registrable Securities registered
under such Registration Statement, and provide the transfer agent for the Common
Stock with printed certificates for the Registrable Securities which are in a
form eligible for deposit with The Depository Trust Company.
(p) Cause all shares of Common Stock covered by the Registration
Statement to be listed or quoted on, each securities exchange or quotation
system on which the Company's Common Stock is then listed or quoted no later
than the date the Registration Statement is declared effective, and, in
connection therewith, to the extent applicable, to make such filings under the
Exchange Act (e.g., the filing of a Registration Statement on Form 8-A) and to
have such filings declared effective thereunder.
(q) Cooperate and assist in any filing required to be made with the
National Association of Securities Dealers, Inc.
The Company may require each Holder of securities to be sold pursuant
to any Registration Statement to furnish to the Company such information
regarding the Holder and the distribution of such securities as the Company may
from time to time reasonably require for inclusion in such Registration
Statement. Any Holder who fails to provide such information shall not be
entitled to use the Prospectus.
4. Registration Expenses. All fees and expenses incident to the
Company's obligations under this Agreement shall be borne by the Company whether
or not any of the Registration Statements become effective. Such fees and
expenses shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses with respect to filings
required to be made with the National Association of Securities Dealers, Inc.),
(ii) printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities in a form eligible for deposit with The
Depository Trust Company, (iii) reasonable fees and disbursements of counsel for
the Company in connection with the Shelf Registration, and (iv) fees and
disbursements of all independent certified public accountants referred to in
Section 3(k)(iii) hereof (including the expenses of any special audit and "cold
comfort" letters required by or incident to such performance). In addition, the
Company shall pay the fees and expenses incurred in connection with the listing
or quotation of the securities to be registered on any securities exchange or
quotations system on which similar securities issued by
9.
<PAGE> 10
the Company are then listed and the fees and expenses of any person, including
special experts, retained by the Company.
5. Indemnification.
(a) Indemnification by the Company. The Company shall indemnify and
hold harmless each Holder, the directors, officers and employees of each such
Holder and each person, if any, who controls any such Holder (within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act)
from and against all losses, liabilities, damages and expenses (including
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim)
(collectively, "Losses"), arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement or Prospectus or in any amendment or supplement thereto, 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 not misleading, in light of the circumstances under which they were
made, except insofar as such Losses arise out of or are based upon the
information relating to any Holder furnished to the Company in writing by any
Holder expressly for use therein. The Company shall also indemnify each
underwriter, their officers and directors, and each person who controls such
person (within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent and with the same limitations as provided
above with respect to the indemnification of the Holders or Registrable
Securities.
(b) Indemnification by Holder of Registrable Securities. Each Holder,
agrees severally and not jointly to indemnify and hold harmless the Company, its
directors, its officers who sign a Registration Statement and each person, if
any, who controls the Company (within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act), from and against all losses
arising out of or based upon any untrue statement of a material fact contained
in any Registration Statement, Prospectus or arising out of or based upon any
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, in light of the circumstances under which
they were made, to the extent, but only to the extent, that such untrue
statement or omission is contained in any information relating to such Holder so
furnished in writing by such Holder to the Company expressly for use in such
Registration Statement or Prospectus. In no event shall the liability of any
Selling Holder of Registrable Securities hereunder be greater in amount than the
dollar amount of the proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. In case any proceeding
(including any governmental investigation) shall be instituted involving any
person in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person (the "indemnified party") shall promptly
notify the person against whom such indemnity may be sought (the "indemnifying
party") in writing, but failure so to notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof. The indemnifying party, upon
request of the indemnified party, shall retain counsel satisfactory to the
indemnified party to represent the indemnified party and
10.
<PAGE> 11
any others the indemnifying party may designate in such proceeding and shall pay
the fees and disbursements of such counsel related to such proceeding. In any
such proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention to such counsel, (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them, or (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action. It is understood that the indemnifying party shall not, in respect of
the legal expenses or any indemnified party in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
all indemnified parties under Section 5(a) or 5(b) hereof who are parties to
such proceeding or proceedings, and that all such fees and expenses shall be
reimbursed as they are incurred. The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in this Section 5
is unavailable (other than by reason of the exceptions set forth herein) to an
indemnified party under Section 5(a) or 5(b) hereof in respect of any Losses or
is insufficient to hold such indemnified party harmless, then each applicable
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, (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the initial placement of the Common Stock pursuant to the Purchase
Agreement. Benefits received by the Holders shall be deemed to be equal to the
value of receiving the Common Stock registered under the Securities Act.
Benefits received by any underwriter shall be deemed to be equal to the total
underwriting discounts and commissions, as set forth on the cover page of the
Prospectus forming a part of the Registration Statement which resulted in such
Losses. The relative fault of the Holders on the one hand and the Company on the
other hand 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
11.
<PAGE> 12
information supplied by the Holders or by the Company and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Holders' respective obligations to contribute
pursuant to this paragraph are several in proportion to the respective number of
Registrable Securities they have sold pursuant to a Registration Statement, and
not joint.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method or allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the Losses
referred to in the immediately preceding paragraph 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. Notwithstanding this Section 5(d), an
indemnifying party that is a Selling Holder of Registrable Securities shall not
be required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities sold by such indemnifying party and
distributed to the public were offered to the public exceeds the amount of any
damages which such indemnifying party 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.
The indemnity, contribution and expense reimbursement obligations of
the Company hereunder shall be in addition to any liability the Company may
otherwise have hereunder, under the Purchase Agreement or otherwise.
The indemnity and contribution provisions contained in this Section 5
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Holder or any person controlling any Holder, or the Company, its officers or
directors or any person controlling the Company and (iii) the sale of any
Registrable Securities by any Holder.
6. Information Requirements.
(a) The Company shall file the reports required to be filed by it under
the Securities Act and the Exchange Act, and if at any time the Company is not
required to file such reports, it will, upon the request of any Holder of
Registrable Securities, make publicly available other information so long as
necessary to permit sales pursuant to Rule 144 under the Securities Act. The
Company further covenants that it will cooperate with any Holder of Registrable
Securities and take such further reasonable action as any Holder of Registrable
Securities may reasonably request (including, without limitation, making such
reasonable representations as any such Holder may reasonably request), all to
the extent required from time to time to enable such Holder to sell Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144 under the Securities Act. Notwithstanding
the foregoing, nothing in this Section 6 shall be deemed to require the Company
to register any of its securities under any section of the Exchange Act.
12.
<PAGE> 13
(b) The Company shall file the reports required to be filed by it under
the Exchange Act and shall comply with all other requirements set forth in the
instructions to the appropriate SEC Registration Statement form permitting
registration of the Registrable Securities for resale by the Holders thereof in
the manner or manners designated by them.
7. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, each Holder of Registrable Securities, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason or a breach by it of any
of the provisions of this Agreement and hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate.
(b) No Conflicting Agreements. The Company has not entered, as of the
date hereof and shall not, on or after the date of this Agreement, enter into
any agreement with respect to its securities which conflicts with the rights
granted to the Holders of Registrable Securities in this Agreement. The Company
represents and warrants that the rights granted to the Holders of Registrable
Securities hereunder do not in any way conflict with the rights granted to the
holders of the Company's securities under any other agreements.
(c) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of Holders of a
Majority of the then outstanding Registrable Securities. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of holders of Registrable
Securities whose securities are being sold pursuant to a Registration Statement
and that does not directly or indirectly affect the rights of other Holders of
Registrable Securities may be given by Holders of at least a majority of the
Registrable Securities being sold by such Holders; provided, that the provisions
of this sentence may not be amended, modified, or supplemented except in
accordance with the provisions of the immediately preceding sentence.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing and shall be deemed given (i) when
made, if made by hand delivery, (ii) upon confirmation, if made by telecopier or
(iii) one business day after being deposited with a reputable next-day courier,
postage prepaid, to the parties as follows:
(x) if to a holder of Registrable Securities, at the most
current address given by such holder to the Company in accordance with
the provisions of Section 7(e):
13.
<PAGE> 14
and
(y) if to the Company, to:
BOLDER Technologies Corporation
4403 Table Mountain Drive
Golden, Colorado 80403
Attention: Daniel S. Lankford
Telecopy No.: (303) 215-7200
with a copy to:
Cooley Godward LLP
2595 Canyon Blvd., Suite 250
Boulder, Colorado 80302
Attention: James H. Carroll
Telecopy No.: (303) 546-4099
or to such other address as such person may have furnished to the other persons
identified in this Section 7(d) in writing in accordance herewith.
(e) Owner of Registrable Securities. The Company will maintain, or will
cause its registrar and transfer agent to maintain, a register with respect to
the Registrable Securities in which all transfers of Registrable Securities of
which the Company has received notice will be recorded. The Company may deem and
treat the person in whose name Registrable Securities are registered in such
register of the Company as the owner thereof for all purposes, including,
without limitation, the giving of notices under this Agreement.
(f) Approval of Holders. Whenever the consent or approval of Holders of
a specified percentage of Registrable Securities is required hereunder,
Registrable Securities held by the Company or its affiliates (as such term is
defined in Rule 405 under the Securities Act) (other than the Purchasers or
subsequent holders of Registrable Securities if such subsequent holders are
deemed to be such affiliates solely by reason of their holdings of such
Registrable Securities) shall not be counted in determining whether such consent
or approval was given by the Holders of such required percentage.
(g) Successors and Assigns. The Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties and shall
inure to the benefit of and be binding upon each holder of any Registrable
Securities.
(h) 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 original and all of which taken together
shall constitute one and the same agreement.
14.
<PAGE> 15
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS BY
THE LAWS OF THE STATE OF NEW YORK AS SUCH LAWS ARE APPLIED TO AGREEMENTS BETWEEN
NEW YORK RESIDENTS ENTERED INTO AND PERFORMED ENTIRELY IN NEW YORK, EXCEPT THAT
THE DELAWARE GENERAL CORPORATION LAW WILL GOVERN AS TO MATTERS OF CORPORATE LAW.
(k) Severability. If any term, provision, covenant or restriction of
this Agreement is held to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect, and shall in no way be affected, impaired
or invalidated thereby, and the parties hereto shall use their best efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions without including any of such which may be hereafter declared
invalid, illegal, void or unenforceable.
(l) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and is 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. Except as provided in the
Purchase Agreement, 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 securities
sold pursuant to the Purchase Agreement. This Agreement supersedes all prior
agreements and understandings among the parties with respect to such subject
matter.
(m) Attorneys' Fees. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party, as determined by the court, shall be
entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
(n) Further Assurances. Each of the parties hereto shall use all
reasonable efforts to take, or cause to be taken, all appropriate action, do or
cause to be done all things reasonably necessary, proper or advisable under
applicable law, and execute and deliver such documents and other papers, as may
be required to carry out the provisions of this Agreement and the other
documents contemplated hereby and consummate the make effective the transactions
contemplated hereby.
(o) Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the end of the Effectiveness Period, except for
any liabilities or obligations under Sections 4 or 5 hereof, each of which shall
remain in effect in accordance with their terms.
15.
<PAGE> 16
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
BOLDER TECHNOLOGIES CORPORATION
By:
-----------------------------------------
Name: Daniel S. Lankford
Title: President and Chief Executive Officer
Accepted as of the date first above written:
PURCHASER
LEGAL NAME OF PURCHASER:
--------------------------------------------------------
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
Date:
-----------------------------
16.
<PAGE> 1
EXHIBIT 10.6
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and
entered into as of July 9, 1999, by and among BOLDER Technologies Corporation, a
Delaware corporation (the "Company") and the persons listed on Exhibit A hereto
(the "Purchasers") with respect to the Purchase Agreement dated as of July 9,
1999 between the Company and the Purchasers (the "Purchase Agreement") for the
purchase of up to 763,215 shares of the Company's Common Stock (the "Common
Stock"). In order to induce the Purchasers to enter into the Purchase Agreement,
the Company has agreed to provide the registration rights set forth in this
Agreement. The execution of this Agreement is a condition to the closing under
the Purchase Agreement.
The Company agrees with the Purchasers, (i) for their benefit as
Purchasers and (ii) for the benefit of the holders from time to time of the
Common Stock (each of the foregoing a "Holder" and together the "Holders"), as
follows:
1. Definitions. Capitalized terms used herein without definition shall
have their respective meanings set forth in the Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:
Affiliate: "Affiliate" means, with respect to any specified person, (i)
any other person directly or indirectly controlling or controlled by, or under
direct or indirect common control with, such specified person or (ii) any
officer or director of such other person. For purposes of this definition, the
term "control" (including the terms "controlling," "controlled by" and "under
common control with") of a person means the possession direct or indirect, of
the power (whether or not exercised) to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting
securities, by contract, or otherwise.
Business Day: Each Monday, Tuesday, Wednesday, Thursday and Friday that
is not a day on which banking institutions in the City of New York are
authorized or obligated by law or executive order to close.
Damages Accrual Period: See Section 2(d) hereof.
Damages Payment Date: The first business day of each month following
the Effectiveness Target Date.
Effectiveness Period: The period commencing with the date hereof and
ending on the earlier of the date that is two years after the later of the
initial date of original issuance of the Common Stock and the date that all
Registrable Securities have ceased to be Registrable Securities.
Effectiveness Target Date: See Section 2(a) hereof.
Event: See Section 2(d) hereof.
1.
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Event Date: See Section 2(d) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Filing Date: See Section 2(a) hereof.
Holder: See the second paragraph of this Agreement.
Initial Shelf Registration: See Section 2(a) hereof.
Liquidated Damages: See Section 2(d) hereof.
Losses: See Section 5 hereof.
Majority of Registrable Securities: A majority of the then outstanding
aggregate principal amount of Registrable Securities.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as
amended or supplemented by any amendment or prospectus supplement, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference in such Prospectus.
Purchase Agreement: See the first paragraph of this Agreement.
Record Holder: With respect to any Damages Payment Date relating to the
Common Stock, each Person who is a registered holder of Common Stock 15 days
prior to such Damages Payment Date.
Registrable Securities: The Common Stock issued pursuant to the
Purchase Agreement, and any Common Stock issued with respect thereto upon any
stock dividend, split or similar event, until (i) it is effectively registered
under the Securities Act and disposed of in accordance with the Registration
Statement covering it, (ii) it is salable by the holder thereof pursuant to Rule
144(k) or (iii) it is sold to the public pursuant to Rule 144, and, as a result
of the event or circumstance described in any of the foregoing clauses (i)
through (iii), the legends with respect to transfer restrictions required under
the Purchase Agreement (other than any such legends required solely as the
consequences or the fact that the Registrable Securities are owned by, or were
previously owned by, the Company or an Affiliate of the Company) are removed or
removable in accordance with the terms of the Purchase Agreement.
Registration Expenses: See Section 5 hereof.
Registration Statement: Any registration statement of the Company which
covers any of
2.
<PAGE> 3
the Registrable Securities pursuant to the provisions of this Agreement,
including the Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
Rule 144: Rule 144 under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulations hereafter adopted
by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations promulgated by the SEC thereunder.
Selling Holder: A Holder offering to sell Registrable Securities.
Shelf Registration: See Section 2(a) hereof.
Subsequent Shelf Registration: See Section 2(b) hereof.
Suspension Period: See Section 2(c).
2. Shelf Registration.
(a) The Company shall prepare and file with the SEC, as soon as
practicable but in any event on or prior to the date 30 days following the
latest date of original issuance of the Common Stock (the "Filing Date"), a
Registration Statement for an offering to be made on a continuous basis pursuant
to Rule 415 of the Securities Act (a "Shelf Registration") registering the
resale from time to time by Holders thereof of all of the Registrable Securities
(the "Initial Shelf Registration"). The Initial Shelf Registration shall be on
an appropriate SEC Registration Statement form permitting registration of such
Registrable Securities for resale by such Holders in the manner or manners
designated by them. The Company shall use its best efforts to cause the Initial
Shelf Registration to be declared effective under the Securities Act as soon as
practicable but in any event or prior to August 16, 1999 (the "Effectiveness
Target Date"), and shall use its best efforts to keep the Initial Shelf
Registration continuously effective under the Securities Act, subject to the
provisions of Section 2(c), until the earlier of the expiration of the
Effectiveness Period or the date a Subsequent Shelf Registration (as defined
below) covering all of the Registrable Securities has been declared effective
under the Securities Act. Subject to the right of the Company to have the
Initial Shelf Registration not be effective, or not to be updated, amended or
supplemented, for periods of time set forth in Section 2(c), the Company further
agrees to use its best efforts to prevent the happening of any event that would
cause the Initial Shelf Registration to contain a material misstatement or
omission or to be not effective and usable for resale of the Registrable
Securities during the Effective Period.
3.
<PAGE> 4
(b) If the Initial Shelf Registration or any subsequent Shelf
Registration ceases to be effective for any reason as a result of the issuance
of a stop order by the SEC at any time during the Effectiveness Period, the
Company shall use its best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 30 days of
such cessation of effectiveness amend the Shelf Registration in a manner
reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Shelf Registration covering all of
the Registrable Securities (a "Subsequent Shelf Registration"). If a Subsequent
Shelf Registration is filed, the Company shall use its best efforts to cause the
Subsequent Shelf Registration to be declared effective as soon as practicable
after such filing and to keep such Registration Statement continuously effective
until the end of the Effectiveness Period.
(c) In the event (A) of the happening of any event of the kind
described in Section 3(c)(ii), 3(c)(iii), 3(c)(iv), 3(c)(v) or 3(c)(vi) hereof
or (B) that, in the good faith judgment of the Company, it is advisable to
suspend the use of the Prospectus for a discrete period of time due to pending
material corporate developments or similar material events that have not yet
been publicly disclosed and as to which the Company believes public disclosure
will be prejudicial to the Company, the Company shall deliver a certificate in
writing, signed by an authorized executive officer of the Company, to the
Purchasers, to the effect of the foregoing and thereafter the use of the
Prospectus shall be suspended, and the Company, subject to the terms of this
Section 2(c), shall thereafter not be required to maintain the effectiveness or
update the Shelf Registration. The Company will use its best efforts to ensure
that the use of the Prospectus may be resumed as soon as practicable, in the
case of suspension under Section 2(c)(A), and, in the case of a pending
development or event referred to in Section 2(c)(B) hereof, as soon as, in the
good faith judgment of the Company, public disclosure of such material corporate
development or similar material event would not have a material adverse effect
on the Company. Notwithstanding the foregoing, the Company shall not under any
circumstances be entitled to exercise its right under this Section 2(c) to
suspend the use of the Prospectus (whether as a result of events referred to in
Section 2(c)(A) hereof or as a result of the pending development or event
referred to in Section 2(c)(B) hereof) more than one (1) time in any three (3)
month period, and the periods in which the use of the Prospectus is suspended
shall not exceed 30 days in any three-month period (a "Suspension Period").
(d) The parties hereto agree that the Holders of Registrable Securities
will suffer damages, and that it would not be feasible to ascertain the extent
of such damages with precision, if the Initial Shelf Registration has not been
declared effective by the Effectiveness Target Date (an "Event," and the
Effectiveness Target Date being referred to herein as an "Event Date").
Notwithstanding the foregoing, the parties hereto agree that an Event shall be
deemed not to have occurred to the extent the parties mutually agree that the
direct, proximate cause of said Event was the act or failure to act of one or
more Holders. An Event shall be deemed to continue until the date of the
termination of such Event, which shall be the date the Initial Shelf
Registration is declared effective.
Accordingly, upon the occurrence of any Event and until such time
as there is no Event which has occurred and is continuing (a "Damages Accrual
Period"), commencing on the Event Date on which such Damages Accrual Period
began, the Company agrees to pay, as
4.
<PAGE> 5
liquidated damages, and not as a penalty, an additional amount (the "Liquidated
Damages") to each holder of shares of Common Stock that are Registrable
Securities, accruing at a rate equal to (i) 24% per annum during the first 30
days following the Effectiveness Target Date and (ii) 12% per annum thereafter,
multiplied by the aggregate purchase price paid by such holder for the number of
shares of Common Stock that are Registrable Securities held by such holder.
Notwithstanding the foregoing, no Liquidated Damages shall accrue as to any
Registrable Securities from and after the earlier of (x) the date such
securities are no longer Registrable Securities, and (y) the expiration of the
Effectiveness Period.
The Liquidated Damages shall be paid by the Company to the Holders
on each Damages Payment Date by wire transfer of immediately available funds to
the account specified by them or by mailing checks to their registered addresses
as they appear in the register of the Company for the Common Stock. Nothing
shall preclude a Holder of Registrable Securities from pursuing or obtaining
specific performance or other equitable relief with respect to this Agreement.
All of the Company's obligations set forth in this Section 2(d)
which are outstanding with respect to any Registrable Securities at the time
such security ceases to be a Registrable Security shall survive until such time
as all such obligations with respect to such security have been satisfied in
full (notwithstanding termination of the Agreement pursuant to Section 7(o)).
The parties hereto agree that the Liquidated Damages provided for in this
Section 2(d) constitute a reasonable estimate of the damages that may be
incurred by holders of Registrable Securities by reason of the failure of the
Shelf Registration to be declared effective in accordance with the provisions
hereof. The provisions of this Section 2(d) shall in no way be deemed to limit
the rights of the Holders to pursue all legal and equitable remedies and to
recovery full damages in the event of a breach of this Agreement by the Company.
In the event of such breach, the Holders shall be permitted to pursue all
remedies as provided for in Section 7(a) below.
3. Registration Procedures. In connection with the Company's
registration obligations under Section 2 hereof, the Company shall effect such
registrations to permit the sale of the Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant thereto
the Company shall as expeditiously as possible:
(a) Prepare and file with the SEC a Registration Statement or
Registration Statements on any appropriate form under the Securities Act
available for the sale of the Registrable Securities by the Holders thereof in
accordance with the intended method or methods of distribution thereof and shall
include all required financial statements, and use its best efforts to cause
each such Registration Statement to become effective and remain effective as
provided herein; provided, that before filing any such Registration Statement or
Prospectus or any amendments or supplements thereto the Company shall furnish
within a reasonable time period to each Selling Holder (if requested by such
Selling Holder) copies of all such documents proposed to be filed, which
documents will be subject to the review of each Selling Holder (if requested by
such Selling Holder), and the Company shall not file any such Registration
Statement or amendment thereto or any Prospectus or any supplement thereto to
which the Holders of a Majority of Registrable Securities covered by such
Registration Statement shall
5.
<PAGE> 6
reasonably object in writing within five Business Days after the receipt
thereof.
(b) Subject to Section 2(c), prepare and file with the SEC such
amendments and post-effective amendments to each Registration Statement as may
be necessary to keep such Registration Statement continuously effective for the
applicable period specified in Section 2; cause the related Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act and comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such Registration Statement
during the applicable period in accordance with the intended methods or
disposition by the sellers thereof set forth in such Registration Statement as
so amended or such Prospectus as so supplemented. The Company shall ensure that
(i) any Shelf Registration and any amendment thereto and any Prospectus forming
a part thereof and any amendment or supplement thereto complies in all material
respects with the Act and the rules and regulations thereunder, (ii) any Shelf
Registration and any amendment thereto does not, when it becomes effective,
contain 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, in
light of the circumstances under which they were made, not misleading and (iii)
any Prospectus forming part of any Shelf Registration, and any amendment or
supplement to such Prospectus, does not include an untrue statement or a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(c) Notify the Holders and (if requested by any such person) confirm
such notice in writing, (i) when a Prospectus, any Prospectus supplement, a
Registration Statement or a post-effective amendment to a Registration Statement
has been filed with the SEC, and, with respect to a Registration Statement or
any post-effective amendment, when the same has become effective; (ii) of any
request by the SEC or any other federal or state governmental authority for
amendments or supplements to a Registration Statement or related Prospectus or
for additional information, (iii) of the issuance by the SEC or any other
federal or state governmental authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation or threatening of
any proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceedings for such
purpose, (v) of the existence of any fact or happening of any event which makes
any statement of a material fact in such Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue or which would require the making of any changes in the
Registration Statement or Prospectus in order that, in the case of the
Registration Statement, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and that in the case of
the Prospectus, it will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, and (vi) of the Company's determination that a
post-effective amendment to a Registration Statement would be appropriate.
6.
<PAGE> 7
(d) Use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement, or the lifting of any
suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest possible
moment.
(e) If requested by the Holders of a Majority of the Registrable
Securities being sold, (i) promptly incorporate in a Prospectus supplement or
post-effective amendment to Registration Statement such information as such
Holders and the Company agree should be included therein, and (ii) make all
required filings of such Prospectus supplement or such post-effective amendment
as soon as practicable after the Company has received notification of the
matters proposed to be incorporated in such Prospectus supplement or
post-effective amendment.
(f) Furnish to each Selling Holder (if requested by such Selling
Holder), without charge, at least one conformed copy of the Registration
Statement or Statements and any amendment thereto, including financial
statements but excluding schedules, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.
(g) Deliver to each Selling Holder in connection with any offering of
Registrable Securities, without charge, as many copies of the Prospectus or
Prospectuses relating to such Registrable Securities (including each preliminary
prospectus) and any amendment or supplement thereto as such persons may
reasonably request; and the Company hereby consents to the use of such
Prospectus or each amendment or supplement thereto by each of the Selling
Holders of Registrable Securities and the Underwriters, if any, in connection
with any offering and sale of the Registrable Securities covered by such
Prospectus or any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities, to register
or qualify or cooperate with the Selling Holders in connection with any
registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States as
any Selling Holder reasonably requests in writing, keep each such registration
or qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective and do any and all other
acts or things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the applicable
Registration Statement, provided, that the Company will not be required to (i)
qualify generally to do business in any jurisdiction where it is not then so
qualified (ii) take any action that would subject it to general service of
process in suits or to taxation in any such jurisdiction where it is not then so
subject.
(i) Cause the Registrable Securities covered by the applicable
Registration Statement to be registered with or approved by such other
governmental agencies in addition to the SEC or authorities within the United
States as may be necessary to enable the Selling Holder or Holders thereof to
consummate the disposition of such Registrable Securities.
7.
<PAGE> 8
(j) During the Effectiveness Period (subject to the provisions of
Section 2(c)), immediately upon the existence of any fact or the occurrence of
any event as a result of which a Registration Statement shall contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or a Prospectus shall
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
promptly prepare and file a post-effective amendment to each Registration
Statement or a supplement to the related Prospectus or any document incorporated
therein by reference or file any other required document (such as a Current
Report on Form 8-K) that would be incorporated by reference into the
Registration Statement so that the Registration Statement shall not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading,
in light of the circumstances under which they were made, and so that the
Prospectus will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, and in the case of a
post-effective amendment to a Registration Statement use its best efforts to
cause it to become effective as soon as practicable.
(k) Enter into such agreements and take all such other actions in
connection therewith in order to expedite or facilitate the disposition of such
Registrable Securities and in such connection, whether or not an underwriting
agreement is entered into.
(l) Make available for inspection by a representative of the Holders of
Registrable Securities being sold and any attorney or accountant retained by
such Selling Holders or underwriter, financial and other records, pertinent
corporate documents and properties of the Company and its subsidiaries, and
cause the executive officers, directors and employees of the Company and its
subsidiaries to supply all information reasonably requested by any such
representative, attorney or accountant in connection with such disposition;
provided, however, that any information that is reasonably and in good faith
designated by the Company in writing as confidential at the time of delivery of
such information shall be kept confidential by such persons, unless (i)
disclosure of such information is required by court or administrative order or
is necessary to respond to inquiries of regulatory authorities, (ii) disclosure
of such information is required by law (including any disclosure requirements
pursuant to federal securities laws in connection with the filing of any
Registration Statement or the use of any prospectus referred to in this
Agreement), (iii) such information becomes generally available to the public
other than as a result of disclosure or failure to safeguard by any such person
or (iv) such information becomes available to any such person from a source
other than the Company and such source is not bound by a confidentiality
agreement.
(m) Comply with all applicable rules and regulations of the SEC in all
material respects and make generally available to its securityholders earning
statements (which need not be audited) satisfying the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act) no later than 45 days after the end of any
12-month period (or 90 days after the end of any 12-month period if such period
8.
<PAGE> 9
is a fiscal year) (i) commencing at the end of any fiscal quarter in which
Registrable Securities are sold to underwriters in firm commitment or best
efforts underwritten offering and (ii) if not sold to underwriters in such an
offering, commencing on the first day of the first fiscal quarter of the Company
commencing after the effective date of a Registration Statement, which
statements shall cover said 12-month periods.
(n) Cooperate with the Selling Holders of Registrable Securities to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends; and
enable such Registrable Securities to be in such denominations and registered in
such names as the Holders may request.
(o) Not later than the effectiveness date of any Registration Statement
hereunder, provide a CUSIP number for the Registrable Securities registered
under such Registration Statement, and provide the transfer agent for the Common
Stock with printed certificates for the Registrable Securities which are in a
form eligible for deposit with The Depository Trust Company.
(p) Cause all shares of Common Stock covered by the Registration
Statement to be listed or quoted on, each securities exchange or quotation
system on which the Company's Common Stock is then listed or quoted no later
than the date the Registration Statement is declared effective, and, in
connection therewith, to the extent applicable, to make such filings under the
Exchange Act (e.g., the filing of a Registration Statement on Form 8-A) and to
have such filings declared effective thereunder.
(q) Cooperate and assist in any filing required to be made with the
National Association of Securities Dealers, Inc.
The Company may require each Holder of securities to be sold pursuant
to any Registration Statement to furnish to the Company such information
regarding the Holder and the distribution of such securities as the Company may
from time to time reasonably require for inclusion in such Registration
Statement. Any Holder who fails to provide such information shall not be
entitled to use the Prospectus.
4. Registration Expenses. All fees and expenses incident to the
Company's obligations under this Agreement shall be borne by the Company whether
or not any of the Registration Statements become effective. Such fees and
expenses shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses with respect to filings
required to be made with the National Association of Securities Dealers, Inc.),
(ii) printing expenses (including, without limitation, expenses of printing
certificates for Registrable Securities in a form eligible for deposit with The
Depository Trust Company, (iii) reasonable fees and disbursements of counsel for
the Company in connection with the Shelf Registration, and (iv) fees and
disbursements of all independent certified public accountants referred to in
Section 3(k)(iii) hereof (including the expenses of any special audit and "cold
comfort" letters required by or incident to such performance). In addition, the
Company shall pay the fees and expenses incurred in connection with the listing
or quotation of the securities to be registered on any securities exchange or
quotations system on which similar securities issued by
9.
<PAGE> 10
the Company are then listed and the fees and expenses of any person, including
special experts, retained by the Company.
5. Indemnification.
(a) Indemnification by the Company. The Company shall indemnify and
hold harmless each Holder, the directors, officers and employees of each such
Holder and each person, if any, who controls any such Holder (within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act)
from and against all losses, liabilities, damages and expenses (including
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim)
(collectively, "Losses"), arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement or Prospectus or in any amendment or supplement thereto, 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 not misleading, in light of the circumstances under which they were
made, except insofar as such Losses arise out of or are based upon the
information relating to any Holder furnished to the Company in writing by any
Holder expressly for use therein. The Company shall also indemnify each
underwriter, their officers and directors, and each person who controls such
person (within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent and with the same limitations as provided
above with respect to the indemnification of the Holders or Registrable
Securities.
(b) Indemnification by Holder of Registrable Securities. Each Holder,
agrees severally and not jointly to indemnify and hold harmless the Company, its
directors, its officers who sign a Registration Statement and each person, if
any, who controls the Company (within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act), from and against all losses
arising out of or based upon any untrue statement of a material fact contained
in any Registration Statement, Prospectus or arising out of or based upon any
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, in light of the circumstances under which
they were made, to the extent, but only to the extent, that such untrue
statement or omission is contained in any information relating to such Holder so
furnished in writing by such Holder to the Company expressly for use in such
Registration Statement or Prospectus. In no event shall the liability of any
Selling Holder of Registrable Securities hereunder be greater in amount than the
dollar amount of the proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. In case any proceeding
(including any governmental investigation) shall be instituted involving any
person in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person (the "indemnified party") shall promptly
notify the person against whom such indemnity may be sought (the "indemnifying
party") in writing, but failure so to notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it is
not materially prejudiced as a result thereof. The indemnifying party, upon
request of the indemnified party, shall retain counsel satisfactory to the
indemnified party to represent the indemnified party and
10.
<PAGE> 11
any others the indemnifying party may designate in such proceeding and shall pay
the fees and disbursements of such counsel related to such proceeding. In any
such proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention to such counsel, (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them, or (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action. It is understood that the indemnifying party shall not, in respect of
the legal expenses or any indemnified party in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
all indemnified parties under Section 5(a) or 5(b) hereof who are parties to
such proceeding or proceedings, and that all such fees and expenses shall be
reimbursed as they are incurred. The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) Contribution. If the indemnification provided for in this Section 5
is unavailable (other than by reason of the exceptions set forth herein) to an
indemnified party under Section 5(a) or 5(b) hereof in respect of any Losses or
is insufficient to hold such indemnified party harmless, then each applicable
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, (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party or parties on the other hand or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions that resulted in such
Losses, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the initial placement of the Common Stock pursuant to the Purchase
Agreement. Benefits received by the Holders shall be deemed to be equal to the
value of receiving the Common Stock registered under the Securities Act.
Benefits received by any underwriter shall be deemed to be equal to the total
underwriting discounts and commissions, as set forth on the cover page of the
Prospectus forming a part of the Registration Statement which resulted in such
Losses. The relative fault of the Holders on the one hand and the Company on the
other hand 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
11.
<PAGE> 12
information supplied by the Holders or by the Company and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Holders' respective obligations to contribute
pursuant to this paragraph are several in proportion to the respective number of
Registrable Securities they have sold pursuant to a Registration Statement, and
not joint.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method or allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the Losses
referred to in the immediately preceding paragraph 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. Notwithstanding this Section 5(d), an
indemnifying party that is a Selling Holder of Registrable Securities shall not
be required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities sold by such indemnifying party and
distributed to the public were offered to the public exceeds the amount of any
damages which such indemnifying party 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.
The indemnity, contribution and expense reimbursement obligations of
the Company hereunder shall be in addition to any liability the Company may
otherwise have hereunder, under the Purchase Agreement or otherwise.
The indemnity and contribution provisions contained in this Section 5
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
any Holder or any person controlling any Holder, or the Company, its officers or
directors or any person controlling the Company and (iii) the sale of any
Registrable Securities by any Holder.
6. Information Requirements.
(a) The Company shall file the reports required to be filed by it under
the Securities Act and the Exchange Act, and if at any time the Company is not
required to file such reports, it will, upon the request of any Holder of
Registrable Securities, make publicly available other information so long as
necessary to permit sales pursuant to Rule 144 under the Securities Act. The
Company further covenants that it will cooperate with any Holder of Registrable
Securities and take such further reasonable action as any Holder of Registrable
Securities may reasonably request (including, without limitation, making such
reasonable representations as any such Holder may reasonably request), all to
the extent required from time to time to enable such Holder to sell Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144 under the Securities Act. Notwithstanding
the foregoing, nothing in this Section 6 shall be deemed to require the Company
to register any of its securities under any section of the Exchange Act.
12.
<PAGE> 13
(b) The Company shall file the reports required to be filed by it under
the Exchange Act and shall comply with all other requirements set forth in the
instructions to the appropriate SEC Registration Statement form permitting
registration of the Registrable Securities for resale by the Holders thereof in
the manner or manners designated by them.
7. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, each Holder of Registrable Securities, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason or a breach by it of any
of the provisions of this Agreement and hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate.
(b) No Conflicting Agreements. The Company has not entered, as of the
date hereof and shall not, on or after the date of this Agreement, enter into
any agreement with respect to its securities which conflicts with the rights
granted to the Holders of Registrable Securities in this Agreement. The Company
represents and warrants that the rights granted to the Holders of Registrable
Securities hereunder do not in any way conflict with the rights granted to the
holders of the Company's securities under any other agreements.
(c) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, unless the Company has obtained the written consent of Holders of a
Majority of the then outstanding Registrable Securities. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of holders of Registrable
Securities whose securities are being sold pursuant to a Registration Statement
and that does not directly or indirectly affect the rights of other Holders of
Registrable Securities may be given by Holders of at least a majority of the
Registrable Securities being sold by such Holders; provided, that the provisions
of this sentence may not be amended, modified, or supplemented except in
accordance with the provisions of the immediately preceding sentence.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing and shall be deemed given (i) when
made, if made by hand delivery, (ii) upon confirmation, if made by telecopier or
(iii) one business day after being deposited with a reputable next-day courier,
postage prepaid, to the parties as follows:
(x) if to a holder of Registrable Securities, at the most
current address given by such holder to the Company in accordance with
the provisions of Section 7(e):
13.
<PAGE> 14
and
(y) if to the Company, to:
BOLDER Technologies Corporation
4403 Table Mountain Drive
Golden, Colorado 80403
Attention: Daniel S. Lankford
Telecopy No.: (303) 215-7200
with a copy to:
Cooley Godward LLP
2595 Canyon Blvd., Suite 250
Boulder, Colorado 80302
Attention: James H. Carroll
Telecopy No.: (303) 546-4099
or to such other address as such person may have furnished to the other persons
identified in this Section 7(d) in writing in accordance herewith.
(e) Owner of Registrable Securities. The Company will maintain, or will
cause its registrar and transfer agent to maintain, a register with respect to
the Registrable Securities in which all transfers of Registrable Securities of
which the Company has received notice will be recorded. The Company may deem and
treat the person in whose name Registrable Securities are registered in such
register of the Company as the owner thereof for all purposes, including,
without limitation, the giving of notices under this Agreement.
(f) Approval of Holders. Whenever the consent or approval of Holders of
a specified percentage of Registrable Securities is required hereunder,
Registrable Securities held by the Company or its affiliates (as such term is
defined in Rule 405 under the Securities Act) (other than the Purchasers or
subsequent holders of Registrable Securities if such subsequent holders are
deemed to be such affiliates solely by reason of their holdings of such
Registrable Securities) shall not be counted in determining whether such consent
or approval was given by the Holders of such required percentage.
(g) Successors and Assigns. The Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties and shall
inure to the benefit of and be binding upon each holder of any Registrable
Securities.
(h) 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 original and all of which taken together
shall constitute one and the same agreement.
14.
<PAGE> 15
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS BY
THE LAWS OF THE STATE OF NEW YORK AS SUCH LAWS ARE APPLIED TO AGREEMENTS BETWEEN
NEW YORK RESIDENTS ENTERED INTO AND PERFORMED ENTIRELY IN NEW YORK, EXCEPT THAT
THE DELAWARE GENERAL CORPORATION LAW WILL GOVERN AS TO MATTERS OF CORPORATE LAW.
(k) Severability. If any term, provision, covenant or restriction of
this Agreement is held to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein
shall remain in full force and effect, and shall in no way be affected, impaired
or invalidated thereby, and the parties hereto shall use their best efforts to
find and employ an alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the
parties that they would have executed the remaining terms, provisions, covenants
and restrictions without including any of such which may be hereafter declared
invalid, illegal, void or unenforceable.
(l) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and is 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. Except as provided in the
Purchase Agreement, 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 securities
sold pursuant to the Purchase Agreement. This Agreement supersedes all prior
agreements and understandings among the parties with respect to such subject
matter.
(m) Attorneys' Fees. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party, as determined by the court, shall be
entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
(n) Further Assurances. Each of the parties hereto shall use all
reasonable efforts to take, or cause to be taken, all appropriate action, do or
cause to be done all things reasonably necessary, proper or advisable under
applicable law, and execute and deliver such documents and other papers, as may
be required to carry out the provisions of this Agreement and the other
documents contemplated hereby and consummate the make effective the transactions
contemplated hereby.
(o) Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the end of the Effectiveness Period, except for
any liabilities or obligations under Sections 4 or 5 hereof, each of which shall
remain in effect in accordance with their terms.
15.
<PAGE> 16
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
BOLDER TECHNOLOGIES CORPORATION
By:
-----------------------------------------
Name: Daniel S. Lankford
Title: President and Chief Executive Officer
Accepted as of the date first above written:
PURCHASER
LEGAL NAME OF PURCHASER:
--------------------------------------------------------
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
Date:
-----------------------------
16.
<PAGE> 1
EXHIBIT 23.1
ARTHUR ANDERSEN LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-3 covering the registration
of 2,053,182 shares of common stock of our reports dated February 3, 1999,
included in BOLDER Technologies Corporation's Form 10-K for the year ended
December 31, 1998 and to all references to our Firm included in this
registration statement.
/s/ Arthur Andersen LLP
Denver, Colorado,
July 9, 1999.
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