SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
Date of Report (Date of earliest event reported):
January 29, 1997 (January 14, 1997)
GreenMan Technologies, Inc.
(Exact name of registrant as specified in its charter)
Delaware 1-13776 71-0724248
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification
Number)
7 Kimball Lane, Building A, Lynnfield, Massachusetts 01940
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 224-2411
(Former name or former address, if changed since last report)
Total number of pages: 3
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Item 1. Changes in Control of Registrant
Not Applicable
Item 2. Acquisition or Disposition of Assets
Not Applicable
Item 3. Bankruptcy or Receivership
Not Applicable
Item 4. Changes in Registrant's Certifying Accountant
Not Applicable
Item 5. Other Events
Not Applicable
Item 6. Resignation of Registrant's Directors
Not Applicable
Item 7. Financial Statements and Exhibits
Not Applicable
Item 8. Change in Fiscal Year
Not Applicable
Item 9. Sale of Equity Securities Pursuant to Regulation S
Pursuant to the terms of a Confidential Term Sheet, dated as of October
15, 1996 and amended by supplements, dated October 28, 1996, December 15, 1996
and January 8, 1997, and in reliance upon the transaction exemptions afforded by
Regulation D ("Regulation D") and Regulation S ("Regulation S") as promulgated
by the Securities and Exchange Commission, under the Securities Act of 1933, as
amended, GreenMan Technologies, Inc. (the "Company") authorized the sale of its
7% Convertible Subordinated Debentures (the "Debentures") up to the maximum
aggregate principal amount of $3,000,000 to both U.S. and non-U.S. residents
(the "Offering"). From January 14 through January 17, 1997, the Company sold
Debentures in the aggregate principal amount of $1,525,000 to one U.S. investor
and six non-U.S. investors. Although the Debentures were sold pursuant to
Regulation D, each of the non-U.S. purchasers in the Offering signed a
subscription agreement confirming its compliance with Rules 902 and 903 of
Regulation S.
The Debentures are convertible, at any time after March 25, 1997 and on
or before one (1) year from the date of issuance, into shares of the Company's
common stock, $.01 par value per share (the "Common Stock"), at a conversion
price for each share of Common Stock equal to the lower of (a) the closing bid
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price for the Common Stock on the date of issuance of the Debenture as reported
by the National Association of Securities Dealers Automated Quotation System
("NASDAQ") or the closing bid price in the over-the counter market or, in the
event the Common Stock is listed on a stock exchange, the closing price on such
exchange, as reported to the Wall Street Journal or (b) seventy percent (70%) of
the Market Price of the Common Stock. As defined in the Debentures, the "Market
Price" shall be the closing bid price of the Common Stock on the trading day
immediately preceding the date on which such Debenture is converted into Common
Stock, as reported by NASDAQ, or the closing bid price in the over-the counter
market or, in the event the Common Stock is listed on a stock exchange, the fair
market value per share shall be the average closing price on the exchange, as
reported to the Wall Street Journal. The foregoing notwithstanding, the
outstanding principal amount of the Debentures will be automatically converted
into shares of Common Stock on January 17, 1998.
In conjunction with the sale of the Debentures, the Company issued to
each purchaser a warrant to purchase one share of Common Stock for every $2.00
of principal of Debentures purchased by such investor at an exercise price per
share of $1.25 (the "Warrants"). Each Warrant expires one year from the date of
issuance thereof.
H.J. Meyers & Co., Inc. acted as placement agent (the "Placement
Agent") in the sale of the Debentures and the Warrants and received an aggregate
placement fee equal to $152,500. In addition, the Placement Agent received an
aggregate of $45,750 as a non-accountable expense allowance. Two foreign
entities that assisted in identifying the non-U.S. investors received warrants
to purchase an aggregate of 450,000 shares of Common Stock at $1.25 per share.
Each such warrant expires one year from the date of issuance thereof.
Pursuant to the terms of Subscription Agreement between the Company and
each of the purchasers, the Company has agreed to register the Common Stock
issuable upon conversion of the Debentures and exercise of the Warrants on a
Form S-3 registration statement on or before March 27, 1997. In the event the
Form S-3 registration statement is not declared effective on or before such
date, all non-U.S. investors will be entitled to resell the Common Stock
issuable upon conversion of the Debentures and Warrants pursuant to Regulation
S.
Exhibits
10.1 Form of Subscription Agreement executed by U.S. and non-U.S. Investors
10.2 Form of Debenture
10.3 Form of Warrant
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
GREENMAN TECHNOLOGIES, INC.
By: /s/ Joseph E. Levangie
Joseph E. Levangie
Chief Financial Officer
Date: January 29, 1997
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Amount of Debentures Subscribed for: $
Number of Warrants Issued:
GREENMAN TECHNOLOGIES, INC.
SUBSCRIPTION AGREEMENT
for
The Purchase of 7% Convertible Subordinated
Debentures and Warrants of the Company
A. The undersigned hereby subscribes for and agrees to purchase $ of 7%
Convertible Subordinated Debentures and warrants to purchase ___________ shares
of common stock of GREENMAN TECHNOLOGIES, INC., a corporation organized and
existing under the laws of the State of Delaware (the "Company"). The Debentures
being offered are more fully described in the Confidential Term Sheet of the
Company dated October 15, 1996 as amended by Supplements dated October 28, 1996,
December 15, 1996 and January 8, 1997 and the Exhibits thereto, (the "Term
Sheet"). The warrants being issued pursuant to the provisions of the Term Sheet
(the "Warrants") shall each be exercisable for one share of the Company's common
stock, $.01 par value per share, at an exercise price of $1.25 per share and
shall be exercisable for a period of one year commencing on January __, 1997 and
expiring at 5:00 pm Eastern Standard Time on January __, 1998. The undersigned
shall receive one Warrant for each $2.00 invested in the Company through
purchase of the Debentures. The undersigned agrees to pay a purchase price equal
to the face value of the Debenture purchased. The undersigned herewith tenders
to the Company the entire amount of such purchase price by wire transfer or by
check made payable to the order of Barry Globerman, Esq.
B. The undersigned acknowledges that neither the Warrants nor the Debentures
(the "Securities") have been registered under the Securities Act of 1933, as
amended (the "Act"), or the securities laws of any state (i) that absent an
exemption or registration under the Act, the Securities cannot be resold, and
(ii) the Securities are being offered for sale in reliance upon exemptions from
registration contained in the Act and applicable state laws, and that the
Company's reliance upon such exemption is based in part upon the undersigned's
representations, warranties and agreements contained in this Subscription
Agreement.
The offering (the "Offering") of Securities shall terminate on such
date as may be determined by the Company and the Placement Agent (as defined
herein) in their discretion (the "Termination Date"), unless sooner terminated
by reason of the sale of all the Securities prior to such time. The Company and
the Placement Agent have the right, in their discretion, to accept or reject any
subscription.
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C. Anything herein to the contrary notwithstanding, the Company agrees to
register the shares of Common Stock issuable upon conversion or exercise of the
Securities in accordance with the following terms and conditions:
(1) The Company will within thirty (30) days of the date of this
Agreement file pursuant to the Act a registration statement on Form S-3 or
equivalent form with respect to the Company Common Stock issuable upon
conversion or exercise of the Securities, and the Company will use its best
efforts to cause such registration to become and remain effective on or before
March 26, 1997 (including the taking of such steps as are necessary to obtain
the removal of any stop order), provided that the undersigned shall furnish the
Company with appropriate information in connection therewith as the Company may
reasonably request in writing. All costs and expenses of the registration
statement shall be borne by the Company, except that the undersigned shall bear
the fees of his or her own counsel and any underwriting discounts or commissions
applicable to any of the securities sold by them. The Company shall supply
prospectuses, and such other documents as the undersigned may request in order
to facilitate the public sale or other disposition of the Company Common Stock
and use its best efforts to register and qualify any of the Company Common Stock
for sale in such states as the undersigned designates.
(2) The Company will indemnify and hold harmless each holder of the
securities covered by such registration statement, amendment or supplement (such
holder being hereinafter called the "Distributing Holder"), and each person, if
any, who controls (within the meaning of the Act) the Distributing Holder, and
each underwriter (within the meaning of the Act) of such securities and each
person, if any, who controls (within the meaning of the Act) any such
underwriter, against any losses, claims, damages or liabilities, joint or
several, to which the Distributing Holder, any such controlling person or any
such underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages, or liabilities, or actions in respect thereof, arise
out of or are based upon any untrue statement or alleged untrue statement or any
material fact contained in any such registration statement or any preliminary
prospectus or final prospectus constituting a part thereof or any amendment or
supplement thereto, or arise out of or are based upon the omission or the
alleged omission to the state therein of a material fact required to be stated
therein or necessary to make the statements therein not misleading. The Company
shall reimburse the Distributing Holder or such controlling person or
underwriter in connection with investigating or defending any such loss, claim,
damage, liability or action, provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon untrue statement or alleged untrue
statement or omission or alleged omission made in said registration statement,
said preliminary prospectus, said final prospectus or said amendment or
supplement in reliance upon and in conformity with written information furnished
by such Distributing Holder or any other Distributing Holder for use in the
preparation thereof.
(3) The Distributing Holder will indemnify and hold harmless the
Company, each of its directors, each of its officers who have signed said
registration statement and such amendments and supplements thereto, and each
person, if any, who controls the Company (within the meaning of the Act)
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against any losses, claims, damages or liabilities, joint or several, to which
the Company or any such director, officer or controlling person may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities, or actions in respect thereof, arise out of or are based upon (i)
any untrue statement of any material fact contained in said registration
statement, said preliminary prospectus, said final prospectus, or said amendment
or supplement, or arise out of or are based upon the omission or the alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in said registration statement, said final
prospectus or said amendment or supplement in reliance upon and in conformity
with written information furnished by such Distributing Holder for use in the
preparation thereof or (ii) the Distributing Holder's failure to deliver a
prospectus as required under applicable federal or state securities laws. The
Distributing Holders shall reimburse the Company or any such director, officer
or controlling person for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such loss, claim, damage,
liability or action.
(4) Promptly after receipt by an indemnified party under this Section C
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against any indemnifying party, give the
indemnifying party notice of the commencement thereof, but the omission so to
notify the indemnifying party will not relieve it from any liability which it
may have to any indemnified party otherwise than under this Section C.
(5) In case any such action is brought against any indemnified party,
and it notified an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate in and, to the extent that it
may wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section C for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.
(6) The obligations of the Company under this Section C to register the
Company Common Stock shall expire and terminate on the earlier of (i) two years
from the Termination Date or (ii) at such time as the Distributing Holder shall
be entitled to sell such securities without restriction and without a need for
the filing of a registration statement under the Act, including, without
limitation, for any resales of "Restricted Securities" made pursuant to Rule 144
as promulgated by the SEC, or a sale made pursuant to Sections 4(1) and/or 4(2)
under the Act.
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(7) In the event that the registration statement referenced in
paragraph (C)(1) is not declared effective by the Commission on or before March
26, 1997, and provided that the undersigned is not a U.S. Person as that term is
defined under Regulation S of the Act, the undersigned, may at its option, (a)
convert the principal amount and accrued interest of the Debenture into shares
of Company Common Stock in accordance with the terms of the Debenture and (b)
exercise the Warrants in accordance with the terms thereof. Such shares will be
deemed to have been issued pursuant to Regulation S and shall be transferable in
accordance with the provisions of Regulation S and paragraph 8 below.
(8) Upon the conversion of any Debenture or the exercise of any Warrant
by a person who is a non-U.S. Person, the Company shall instruct its transfer
agent to issue certificates without restrictive legend in the name of the
undersigned (or its nominee (being a non-U.S. Person) or such non-U.S. Person as
may be designated by the undersigned prior to the closing) and in such
denominations to be specified at conversion or exercise representing the number
of shares of Common Stock issuable upon such conversion or exercise, as
applicable. The Company warrants that no instructions other than these
instructions and instructions to impose a "stop transfer" instruction with
respect to the certificates until the end of the Restricted Period have been
given or will be given to the transfer agent and that the Common Stock shall
otherwise be freely transferable on the books and records of the Company.
Nothing in this paragraph 8, however, shall affect in any way the undersigned's
or such nominee's obligations and agreements to comply with all applicable
securities laws upon resale of the Securities.
D. If at any time within two (2) weeks of the date of this Agreement, the
Company seeks to sell for cash any shares of its Common Stock or its promissory
notes to a third party, the Company shall provide the undersigned with notice of
same. The undersigned shall have the right within five (5) business days of its
receipt of the notice pursuant to this provision to purchase an amount of
Debentures and Warrants equal to the amounts subscribed for hereunder with the
same terms and conditions as set forth herewith.
E. In order to induce the Company to accept this Subscription Agreement, the
undersigned represents and warrants to the Company and H.J. Meyers & Co., Inc.
(the "Placement Agent") as follows:
(l) The undersigned understands that (i) this Subscription Agreement
may be accepted or rejected in whole or in part in the discretion of the Company
or the Placement Agent, and (ii) this Subscription Agreement, unless properly
revoked before acceptance, shall survive the undersigned's death, disability or
insolvency, except that the undersigned shall have no obligations in the event
that this Subscription Agreement is rejected by the Company. In the event that
the Company does not accept the undersigned's subscription, or if the Offering
is terminated for any reason, the undersigned's payment will be returned to him
without interest or deduction.
(2) The undersigned has read carefully this Subscription Agreement and
the Term Sheet (including the Exhibits annexed thereto) and, to the extent
necessary, has discussed the representations, warranties and agreements which
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the undersigned makes by signing it, and the applicable limitations upon the
undersigned's resale of the Securities with his or its counsel.
(3) The undersigned understands that no federal or state agency has
made any finding or determination regarding the fairness of the offering of the
Securities, or any recommendation or endorsement of the offering of the
Securities. Any representation to the contrary is a criminal offense.
(4) The undersigned is purchasing the Securities for the undersigned's
own account, with the intention of holding the Securities for investment
purposes, with no present intention of dividing or allowing others to
participate in this investment or of reselling or otherwise participating,
directly or indirectly, in a distribution of the Securities; and shall not make
any sale, transfer or other disposition of the Securities without registration
under the Act and applicable state securities laws unless an exemption from
registration is available under those laws.
(5) The undersigned's overall commitment to investments which are not
readily marketable is not disproportionate to the undersigned's net worth, and
the undersigned's investment in the Securities will not cause such overall
commitment to become excessive.
(6) The undersigned, if an individual, has adequate means of providing
for his current needs and personal and family contingencies and has no need for
liquidity in his investment in the Securities.
(7) The undersigned is an "accredited investor" as that Term is defined
in Section 501(a) under Regulation D promulgated by the Securities and Exchange
Commission under the Act which definition is attached hereto. The undersigned is
financially able to bear the economic risk of this investment, including the
ability to afford holding the Securities for an indefinite period or to afford a
complete loss of this investment.
(8) The address shown under the undersigned's signature at the end of
this Subscription Agreement is the undersigned's principal residence if he is an
individual, or its principal business address if a corporation or other entity.
(9) The undersigned, together with any purchaser representatives of the
undersigned (as identified herein) has such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of an investment in the Securities.
(10) The undersigned has received and read the Term Sheet.
(11) The undersigned has been given the opportunity to ask questions of
and receive answers from the Company concerning the terms and conditions of the
Offering and to obtain additional information necessary to verify the accuracy
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of the information contained in the Term Sheet or such other information as the
undersigned desired in order to evaluate the investment, and the undersigned
availed itself of such opportunity to the extent considered appropriate in order
to evaluate the merits and risks of the proposed investment. Notwithstanding the
foregoing, the only information upon which the undersigned has relied in making
the investment decision is that set forth in the Term Sheet and the exhibits
thereto. The undersigned acknowledges that the undersigned has received no
representations or warranties from the Company and its employees or the
Placement Agent and its employees other than as set forth in the Term Sheet.
(12) The undersigned has made an independent evaluation of the merits
of the investment and acknowledges the high risk nature of the investment.
(13) The undersigned has accurately completed the Qualified Purchaser
Questionnaire provided herewith and has executed such Qualified Purchaser
Questionnaire and any applicable exhibits thereto.
(14) The undersigned understands that even if the Company is a
"reporting company" under the Securities Exchange Act of 1934, as amended, the
provisions of Rule 144 promulgated under the Act to permit resales of the
Securities are not available for at least two (2) years from the date the
Securities are paid for and accepted, there can be no assurance that the
conditions necessary to permit routine sales of the Securities under Rule 144
will ever be satisfied, that such sales required that the Company be current in
filing periodic reports under the Securities Exchange Act of 1934, and, if Rule
144 should become available, sales made in reliance on its provisions could be
made only in limited amounts and in accordance with the terms and conditions of
the Rule. The undersigned further understands that in connection with the sale
of securities for which Rule 144 is not available, compliance with some other
registration exemption will be required. The undersigned understands that,
except as set forth in this Subscription Agreement, the Company is under no
obligation to the undersigned to register the Securities or to comply with the
conditions of Rule 144 or take any other action necessary in order to make
available any exemption for the resale of the Securities without registration.
(15)(a) The undersigned understands that as of the date of this
agreement, none of the Securities have been registered under the Act, or any
state securities laws in reliance on exemptions for private offerings; the
Securities cannot be resold or otherwise disposed of unless they are
subsequently registered under the Act and applicable sate securities laws or an
exemption from registration is available. The certificate(s) representing the
Securities will bear the following legend until (i) such securities shall have
been registered under the Act and effectively disposed of in accordance with the
registration statement; or (ii) such Securities may be sold pursuant to an
exemption from the registration requirements of the Act:
"THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES ONLY, HAVE NOT BEEN
AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED, AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE"1933 ACT"),
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AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES (AS DEFINED IN
REGULATIONS OF THE 1933 ACT) OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS (AS DEFINED IN REGULATION S OF THE 1933 ACT) EXCEPT PURSUANT TO
REGISTRATION UNDER OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
1933 ACT."
(b) The undersigned understands that in the absence of registration by
the Company, the Securities will not be, and the undersigned will have no rights
to require that the Securities be registered under the 1933 Act or any state
securities laws; there will be no public market for the Securities and there is
no assurance one will develop in the future; the undersigned may have to hold
the Securities indefinitely and it may not be possible for the undersigned to
liquidate its investment in the Company; and the undersigned should not purchase
any Securities unless it can afford a complete loss of its investment and bear
the burden of such loss for an indefinite period of time.
(16) In the event that the undersigned is not a U.S. Person (as defined
in Section 902(o) of Regulation S of the Act, it hereby acknowledges the
additional representations in Exhibit A attached hereto.
F. If at any time prior to acceptance of the subscription for the
Securities of the undersigned, any representation or warranty of the undersigned
shall no longer be true, the undersigned promptly shall give written notice to
the Company and the Placement Agent specifying which representations and
warranties are not true and the reason therefor, whereupon the undersigned's
subscription may be rejected.
G. The Company represents and warrants to the undersigned as follows:
(a) The Company has registered its Common Stock pursuant to Section 12
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
Common Stock is listed and trades on NASDAQ. Seller has filed all material
required to be filed pursuant to all reporting obligations under either Section
13(a) or 15(d) of the Exchange Act for a period of at least twelve (12) months
immediately preceding the offer or sale of the Securities (or for such shorter
period that Seller has been required to file such material).
(b) The Company has furnished the undersigned with copies of its most
recent reports, as amended, filed under the Exchange Act referred to in
paragraph (a) above, and such other publicly available documents as requested by
the undersigned.
(c) The issuance, sale and delivery of the Securities have been duly
authorized by all required corporate action on the part of the Company, and when
issued, sold and delivered in accordance with the terms hereof and thereof for
the consideration expressed herein and therein, will be duly and validly issued,
fully paid and non-assessable. The Common Stock issuable upon conversion of the
Debentures and exercise of the Warrants, as applicable, has been duly and
validly reserved for issuance and, upon issuance in accordance with the
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respective terms of the Securities shall be duly and validly issued, fully paid,
and non-assessable and will not subject the holders thereof, if such persons are
non- U.S. persons, to personal liability by reason of being such holders. There
are no pre-emptive rights of any shareholder of the Company.
(d) This Agreement has been duly authorized, validly executed and
delivered on behalf of the Company and is a valid and binding agreement in
accordance with its terms, subject to general principals of equity and to
bankruptcy or other laws affecting the enforcement of creditors' rights
generally.
(e) The execution and delivery of this Agreement and the consummation
of the issuance of the Securities and the transactions contemplated by this
Agreement do not and will not conflict with or result in a breach by the Company
of any of the terms or provisions of, or constitute a default under, the
Certificate of Incorporation or By-laws of the Company, or any indenture,
mortgage, deed of trust, or other material agreement or instrument to which the
Company is a party or by which it or any of its properties or assets are bound,
or any existing applicable law, rule or regulation of the United States or any
State thereof or any applicable decree, judgment or order of any Federal or
State court, Federal or State regulatory body, administrative agency or other
United States governmental body having jurisdiction over the Company or any of
its properties or assets.
(f) The Company is not aware of any authorization, approval or consent
of any governmental body which is legally required for the issuance and sale of
the Securities and the Common Stock issuable upon conversion or exercise thereof
to persons who are non- U.S. Persons, as contemplated by this Agreement.
H. Notwithstanding the place where this Subscription Agreement may be
executed by any of the parties hereto, all the terms and provisions hereof shall
be construed in accordance with and governed by the laws of The Commonwealth of
Massachusetts, without giving effect to its conflict of law principles. Any
dispute which may arise out of or in connection with this Subscription Agreement
shall be adjudicated before a court located in The Commonwealth of Massachusetts
and the parties hereby submit to the exclusive jurisdiction of the courts of The
Commonwealth of Massachusetts and of the federal courts in The Commonwealth of
Massachusetts with respect to any action or legal proceeding commenced by any
party, and irrevocably waive any objection they now or hereafter may have
respecting the venue of any action or proceeding brought in such a court or
respecting the fact that such court is an inconvenient forum, relating to or
arising out of this Subscription Agreement or any acts or omissions relating to
the sale of the Securities, and the undersigned consents to the service of
process in any such action or legal proceeding by means of registered or
certified mail, return receipt requested, in care of the address set forth below
or such other address as the undersigned shall furnish in writing to the Company
and the Placement Agent.
I. The undersigned hereby waives trial by jury in any action or
proceeding involving, directly or indirectly, any matter (whether sounding in
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tort, contract, fraud or otherwise) in any way arising out of or in connection
with this Subscription Agreement or the undersigned's purchase of the
Securities.
J. The undersigned acknowledges that he understands the meaning and
legal consequences of the representations, warranties and acknowledgments
contained in this Subscription Agreement and in the Qualified Purchaser
Questionnaire, and hereby agrees to indemnify and hold harmless the Company and
the Placement Agent, and their respective shareholders, officers, directors,
affiliates, "controlling persons", agents and representatives, from and against
any and all loss, damage, expense, claim, action, suit or proceeding (including
the reasonable fees and expenses of legal counsel) as incurred arising out of or
in any manner whatsoever connected with a breach of any representation or
warranty of the undersigned contained in this Subscription Agreement or in the
Qualified Purchaser Questionnaire. The undersigned acknowledges that such damage
could be substantial since (a) the Securities are being offered without
registration under the Act in reliance upon the exemption pursuant to Section
4(2) of the Act for transactions by an issuer not involving a public offering
and, in various states, pursuant to exemptions from registration, (b) the
availability of such exemptions is, in part, dependent upon the truthfulness and
accuracy of the representations made by the undersigned herein and in its
Qualified Purchaser Questionnaire, and (c) the Company will rely on such
representations in accepting the undersigned's Subscription Agreement.
K. Except as expressly provided herein, this Subscription Agreement
contains the entire agreement between the parties with respect to the
transactions contemplated hereunder and may be amended only by a writing
executed by all of the parties hereto. This Subscription Agreement supersedes
all prior arrangements or understandings with respect thereto, whether verbal or
written. The terms and conditions of this Subscription Agreement shall inure to
the benefit of and be binding upon the parties and their respective successors,
heirs and assigns.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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ALL SUBSCRIBERS MUST COMPLETE THIS PAGE
IN WITNESS WHEREOF, the undersigned has executed this Subscription
Agreement on this _______ day of ______________, 1997.
$
Debentures Subscribed For Warrants Subscribed for
<TABLE>
<CAPTION>
Manner in which Title is to be held (Please Check One):
<S> <C> <C> <C> <C> <C>
1. / / Individual 7. / / Trust/Estate/Pension or Profits
Sharing Plan
Date Opened:
2. / / Joint Tenants With 8. / / As a Custodian for
Right of Survivorship
3. / / Community Property
Under the Uniform Gift to Minors
Act of the State of
4. / / Tenants in Common
5. / / Corporate/Partnership 9. / / Married with Separate Property
6. / / IRA 10. / / Keogh
</TABLE>
INDIVIDUAL SUBSCRIBERS MUST COMPLETE PAGE 11.
SUBSCRIBERS THAT ARE ENTITIES MUST COMPLETE PAGE 12.
Name of Purchaser
Registered Representative
Please indicate whether or not you or any member of your immediate family
is affiliated with any member of the National Association of Securities Dealers,
Inc. A member of your immediate family includes parents, mother-in-law,
father-in-law, husband or wife, brother or sister, brother-in-law or
sister-in-law, son-in-law, daughter-in-law and children and any other person who
is supported, directly or indirectly to a material extent by the subscriber.
Check One: / / No Affiliates / / Affiliated with (explain)
-10-
<PAGE>
EXECUTION BY SUBSCRIBER WHO IS A NATURAL PERSON
Exact Name in Which Title is to be Held
(Signature)
(If joint Tenant or Tenants in Common, both persons must sign and this page must
contain all information for both persons).
Name (Please Print)
Residence: Number and Street
City State Zip Code
Telephone Number
Social Security Number
ACCEPTED this day of , 1997, on behalf of the Company.
GREENMAN TECHNOLOGIES, INC.
By:
Name:
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<PAGE>
EXECUTION BY SUBSCRIBER THAT IS AN ENTITY
(Corporation, Partnership, Trust, Etc.)
Name of Entity (Please Print)
Address of Principal Office of Entity
(seal) BY:
TITLE:
Attest:
(If Entity is a Corporation)
Address
Telephone Number
Taxpayer Identification Number
ACCEPTED, this day of , 1997, on behalf of the Company.
GREENMAN TECHNOLOGIES, INC.
By:
Name:
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<PAGE>
EXHIBIT A
GREENMAN TECHNOLOGIES, INC.
ADDITIONAL REPRESENTATIONS MADE BY NON-U.S. PERSONS
In connection with the purchase and sale of the Debentures and the
Warrants, the Undersigned represents and warrants to, and covenants and agrees
with the Company as follows:
1. The Undersigned is not a natural person and is not organized under
the laws of any jurisdiction within the United States, was not formed by a U.S.
Person (as defined in Section 902(o) of Regulation S) for the purpose of
investing in Regulation S securities and is not otherwise a U.S. Person. The
Undersigned is not, and on the closing date will not be an affiliate of the
Company;
2. At the time the buy order was originated, the Undersigned was
outside the United States and is outside of the United States as of the date of
the execution and delivery of this Agreement;
3. No offer to purchase the Debentures, the Warrants or the common
stock of the Company issuable upon conversion of the Debentures or exercise of
the Warrants (collectively, the "Securities"), was made by the Undersigned in
the United States;
4. The Undersigned is purchasing the Securities for its own account and
the Undersigned is qualified to purchase the Securities under the laws of its
jurisdiction of residence, and the offer and sale of the Securities will not
violate the securities or other laws of such jurisdiction;
5. All offers and sales of any of the Securities by the Undersigned
prior to the end of the Restricted Period (as hereinafter defined) shall be made
in compliance with any applicable securities laws of any applicable jurisdiction
and in accordance with Rule 903 and 904, as applicable, of Regulation S or
pursuant to registration of securities under the 1933 Act or pursuant to an
exemption from registration. In any case, none of the Securities have been and
will be offered or sold by the Undersigned to, or for the account or benefit of,
a U.S. Person or within the United States until after March 25, 1997 (the
"Restricted Period"), as certified by the Undersigned to the Company, and
thereafter only pursuant to a Registration Statement or an applicable exemption
therefrom;
6. The transactions contemplated by this Agreement (a) have not been
and will not be pre-arranged by the Undersigned with a purchaser located in the
United States or a purchaser which is a U. S. Person, and (b) are not and will
not be part of a plan or scheme by the Undersigned, to evade the registration
provisions of the 1933 Act;
-13-
<PAGE>
7. The Undersigned understands that the Securities are not registered
under the 1933 Act and are being offered and sold to it in reliance on specific
exclusions from the registration requirements of Federal and State securities
laws, and that the Company is relying upon the truth and accuracy of the
representations, warranties, agreements, acknowledgments and understandings of
the Undersigned set forth herein in order to determine the applicability of such
exclusions and the suitability of the Undersigned and any purchaser from the
Undersigned to acquire the Securities;
8. The Undersigned shall take all reasonable steps to ensure its
compliance with Regulation S and shall promptly send to each purchaser who acts
as a distributor, dealer or a person receiving a selling concession, fee or
other remuneration in respect of any of the Securities, who purchases prior to
the expiration of the Restricted Period referred to in subparagraph (v) above, a
confirmation or other notice to the purchase stating that the purchaser is
subject to the same restrictions on offers and sales as the Undersigned pursuant
to Section 901(c)(2)(iv) of Regulation S;
9. The Undersigned has not conducted and shall not conduct any
"directed selling efforts" as that term is defined in Rule 902(b) of Regulation
S; nor has the Undersigned conducted any general solicitation relating to the
offer and sale of any of the Securities in the United States or elsewhere;
10. This Agreement has been duly authorized, validly executed and
delivered on behalf of the Undersigned and is a valid and binding agreement in
accordance with its terms, subject of general principals of equity and to
bankruptcy or other laws affecting the enforcement of creditors' rights
generally;
11. The execution and delivery of this Agreement and the consummation
of the purchase of the Securities, and the transactions contemplated by this
Agreement do not and will not conflict with or result in a breach by the
Undersigned of any of the terms or provisions of, or constitute a default under,
the articles of incorporation or by-laws (or similar constitutive documents) of
the Undersigned of any indenture, mortgage, deed of trust, or other material
agreement or instrument to which the Undersigned is a party or by which it or
any of its properties or assets are bound, or any existing applicable law, rule
or regulation of the United States or any State thereof or any applicable
decree, judgment or order of any Federal or State court, Federal or State
regulatory body, administrative agency or other United States governmental body
having jurisdiction over the Undersigned or any of its properties or assets;
12. All invitations, offers and sales or in respect of, any of the
Securities, by the Undersigned and any distribution by the Undersigned of any
documents relating to any offer by it of any of the Securities will be in
compliance with applicable laws and regulations and will be made in such a
manner that no prospectus need be filed and no other filing need be made by the
Company with any regulatory authority or stock exchange in any country or any
political sub-division of any country;
-14-
<PAGE>
13. The Undersigned will not make any offer or sale of the Securities
by any means which would not comply with the laws and regulations of the
territory in which such offer or sale takes place or to which such offer or sale
is subject or which would in connection with any such offer or sale impose upon
the Company any obligation to satisfy any public filing or registration
requirement or provide or publish any information of any kind whatsoever or
otherwise undertake or become obligated to do any act; and
14. Neither the Undersigned nor any of its affiliates has entered, has
the intention of entering, or will during the Restricted Period enter into any
put option, short position or other similar instrument or position with respect
to any of the Securities or securities of the same class as the Securities.
ACKNOWLEDGED AND AGREED BY PURCHASER:
Signature
Printed Name & Title (if applicable)
-15-
THIS DEBENTURE HAS BEEN ACQUIRED FOR INVESTMENT PURPOSES ONLY, HAS NOT
BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE "1933 ACT"), AND MAY
NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES (AS DEFINED IN REGULATION S OF
THE 1933 ACT) OR TO, OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS (AS DEFINED
IN REGULATION S OF THE 1933 ACT) EXCEPT PURSUANT TO REGISTRATION UNDER OR AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT. THIS LEGEND SHALL
BE ENDORSED UPON ANY NOTE ISSUED IN EXCHANGE FOR THIS NOTE.
GREENMAN TECHNOLOGIES, INC.
7% CONVERTIBLE SUBORDINATED DEBENTURE
No. [ ] $[ ]
--------- ---------------
GREENMAN TECHNOLOGIES, INC., a Delaware corporation (the "Company"), for value
received, hereby promises to pay to or registered assigns (the "Payee" or
"Holder") (the "Maturity Date") at the offices of the Company, 7 Kimball Lane,
Building A, Lynnfield, Massachusetts 01940, the principal amount of [ ] ($ ),
which shall be payable in cash or by check. Interest on the principal amount of
this Debenture shall be paid at the rate of seven percent (7%) per annum accrued
during the period that the principal amount of this Debenture is outstanding,
payable at the option of the Company in cash, by check, or in shares of Common
Stock of the Company using the Conversion rate set forth in paragraph 4 hereof,
six months and one year from the date of this Debenture.
This Debenture is one of a series of Debentures in the maximum
aggregate principal amount of $3,000,000 (the "Offering") issued by the Company
pursuant to a Subscription Agreement dated of even date herewith, between the
Company and the Payee (the "Subscription Agreement"), a copy of which agreement
is available for inspection at the Company's principal office. Notwithstanding
any provision to the contrary contained herein, this Debenture is subject and
entitled to certain terms, conditions, covenants and agreements contained in the
Subscription Agreement. Any transferee or transferees of the Debenture, by their
acceptance hereof, assume the obligations of the Payee in the Subscription
Agreement with respect to the conditions and procedures for transfer of the
Debenture. Reference to the Subscription Agreement shall in no way impair the
absolute and unconditional obligation of the Company to pay both principal and
interest hereon as provided herein.
<PAGE>
The Company covenants and agrees that, so long as this Debenture shall
be outstanding, it will:
(i) Promptly pay and discharge all lawful taxes, assessments,
and governmental charges or levies imposed upon the Company or upon its income
and profits, or upon any of its property, before the same shall become in
default, as well as all lawful claims for labor, materials and supplies which,
if unpaid, might become a lien or charge upon such properties or any part
thereof: provided however, that the Company shall not be required to pay and
discharge any such tax, assessment, charge, levy or claim so long as the
validity thereof shall be contested in good faith by appropriate proceedings and
the Company shall set aside on its books adequate reserves with respect to any
such tax, assessment, charge, levy or claim so contested;
(ii) Do or cause to be done all things reasonably necessary to
preserve and keep in full force and effect its corporate existence, rights and
franchises and comply with all laws applicable to the Company, except where the
failure to comply would not have a material adverse effect on the Company;
(iii) At all times reasonably maintain, preserve, protect and
keep its property used or useful in the conduct of its business in good repair,
working order and condition, and from time to time make all needful and proper
repairs, renewals, replacements, betterments and improvements thereto as shall
be reasonably required in the conduct of its business;
(iv) To the extent necessary for the operation of its
business, keep adequately insured by all financially sound reputable insurers,
all property of a character usually insured by similar corporations and carry
such other insurance as is usually carried by similar corporations; and
(v) At all times keep true and correct books, records
and accounts.
This Debenture is subject to the following additional provisions:
1. The Debentures are issuable in denominations of Fifty Thousand
Dollars ($50,000 U.S.) and integral multiples thereof. The Debentures are
exchangeable for an equal aggregate principal amount of Debentures of different
authorized denominations, as requested by the Holders surrendering the same. No
service charge will be made for such registration of transfer or exchange.
2. The Company shall be entitled to withhold from all payments of
principal of, and interest on, this Debenture any amounts required to be
withheld under the applicable provisions of the United States income tax laws or
other applicable laws at the time of such payments.
-2-
<PAGE>
3. This Debenture has been issued subject to investment representations
of the original purchaser hereof and may be transferred or exchanged only in
compliance with the Securities Act of 1933, as amended (the "Act"). Prior to due
presentment for transfer of this Debenture, the Company and any agent of the
Company may treat the person in whose name this Debenture is duly registered on
the Company's Debenture Register as the owner hereof for the purpose of
receiving payment as herein provided and for all other purposes, whether or not
this Debenture be overdue, and neither the Company nor any such agent shall be
affected by notice to the contrary. Any holder of this Debenture who is a
non-U.S. Person electing to exercise the right of conversion set forth in
Section 4 hereof, in addition to the requirements set forth in Section 4, is
also required to give the Company (i) written confirmation that it is not a U.S.
Person and the Debenture is not being converted on behalf of a U.S. Person
("Notice of Conversion") or (ii) an opinion of U.S. counsel to the effect that
the Debenture and shares of Common Stock issuable upon conversion thereof have
been registered under the 1933 Act or are exempt from such registration. In the
event a Notice of Conversion or opinion of counsel is not provided the Holder
hereof will bot be entitled to exercise the right to convert the Debentures
pursuant to Section 4 herein.
4. The Holder of this Debenture is entitled, at its option, at any time
after March 25, 1997 and until maturity hereof to convert the entire principal
amount of this Debenture or any portion of the principal amount hereof which is
at least Fifty Thousand ($50,000), or if at the time of such election to
convert, the aggregate principal amount of all Debentures registered to the
Holder is less then Fifty Thousand Dollars ($50,000), then the whole amount
thereof, into Shares of Common Stock of the Company at a conversion price for
each share of Common Stock equal to the lower of (a) the closing bid price for
the Common Stock on the date hereof as reported by the National Association of
Securities Dealers Automated Quotation System ("NASDAQ") or the closing bid
price in the over-the counter market or, in the event the Common Stock is listed
on a stock exchange, the closing price on such exchange, as reported to the Wall
Street Journal or (b) seventy percent (70%) of the Market Price of the Company's
Common Stock. The foregoing notwithstanding, the outstanding principal amount of
this Debenture shall be automatically converted into shares of Common Stock of
the Company upon the first anniversary of the termination of the Offering. For
purposes of this Section 4, the Market Price shall be the closing bid price of
the Common Stock on the trading day immediately preceding the conversion date,
as reported by NASDAQ, or the closing bid price in the over-the counter market
or, in the event the Common Stock is listed on a stock exchange, the fair market
value per Share shall be the average closing price on the exchange, as reported
to the Wall Street Journal. Such conversion shall be effectuated by surrendering
the Debentures to be converted (with a copy, by facsimile or courier, to the
Company) to the Company with the form of conversion notice attached hereto as
Exhibit A, executed by the Holder of this Debenture evidencing such Holder's
intention to convert this Debenture or a specified portion (as above provided)
hereof, and accompanied, if required by the Company, by proper assignment hereof
in blank. The Company shall use its best efforts to have the Shares of Common
Stock issued and delivered to the Holder thereof within seven business days of
-3-
<PAGE>
the receipt of the conversion form and Debenture(s). No fractions of shares or
scrip representing fractions of shares will be issued on conversion, but the
number of shares issuable shall be rounded to the nearest whole share. The date
on which notice of conversion is given shall be deemed to be the date on which
the Holder has delivered this Debenture, with the conversion notice duly
executed, to the Company, or, if earlier, the date set forth in such notice of
conversion if this Debenture is received by the Company within five business
days hereafter.
5. The Company hereby reserves the right, in its sole discretion, to
redeem some or all of the Redemption Principal and accrued interest on this
Debenture, upon five (5) days written notice to the Holder (the "Redemption
Notice"), if the Market Price of the Common Stock averages $.90 or less for five
(5) consecutive trading days. As used herein, the term Redemption Principal
shall mean 130% of the principal of this Debenture sought to be redeemed by the
Company. For purposes of this Section 5, the Market Price shall be the closing
bid price of the Common Stock as reported by NASDAQ, or the closing bid price in
the over-the counter market or, in the event the Common Stock is listed on a
stock exchange, the average closing price on such exchange, as reported to the
Wall Street Journal. Notwithstanding anything to the contrary contained in this
Section 5, the Holder of this Debenture shall retain the right to convert the
Debenture pursuant to the terms hereof by notifying the Company in writing of
its intent to convert the Debenture within three (3) business days of receipt of
the Redemption Notice.
6. No provision of this Debenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the principal of,
and interest on, this Debenture at the time, place and rate, and in the coin or
currency, herein prescribed. This Debenture and all other Debentures now or
hereafter issued of similar terms are direct obligations of the Company. This
Debenture ranks equally and ratably with all other Debentures now or hereafter
issued under the terms set forth herein.
7. No recourse shall be had for the payment of the principal of, or the
interest on, this Debenture, or for any claim based hereon, or otherwise in
respect hereof, against any incorporator, shareholder, officer or director, as
such, past, present or future, of the Company or any successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released.
8. The Holder of this Debenture, by acceptance hereof, agrees that this
Debenture is being acquired for investment and that such Holder will not offer,
sell or otherwise dispose of this Debenture or the Shares of Common Stock
issuable upon exercise thereof except under circumstances which will not result
in a violation of the Act or any applicable state Blue Sky law or similar laws
relating to the sale of securities.
-4-
<PAGE>
9. As set forth herein, the Company shall use all reasonable efforts to
issue and deliver, within seven business days after the Holder has fulfilled all
conditions and submitted all necessary documents duly executed and in proper
form required for conversion ( the "Deadline"), to the Holder or any party
receiving a Debenture by transfer from the Holder (together, a "Holder"), at the
address of the Holder on the books of the Company, a certificate or certificates
for the number of Shares of Common Stock to which the Holder shall be entitled.
The Company understands that a delay in the issuance of the Shares of Common
Stock beyond the Deadline could result in economic loss to the Holder. To
satisfy Holder that certificates for the Shares of Common Stock issuable upon
conversion of the Debentures will be issued in accordance with the foregoing,
the Company will issue and deposit with its transfer agent, American Stock
Transfer & Trust Company (hereinafter the "Escrow Agent"), a certificate without
restrictive legend (with a stock power endorsed in blank) representing one share
of Company Common Stock for each dollar of principal of the Debenture. In the
event that the Company does not satisfy its obligations under this provision,
the Escrow Agent shall deliver to the Holder the certificate or certificates
registered in the name of the Holder.
10. The Debenture represents a general unsecured obligation of the
Company. No recourse shall be had for the payment of the principal of, or the
interest on, this Debenture, or for any claim based hereon, or otherwise in
respect hereof, against any incorporator, shareholder, officer or director, as
such, past, present or future, of the Company or any successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released.
C. Events of Default
1. This Debenture shall become and be due and payable upon written
demand made by the holder hereof if one or more of the following events, herein
called events of default, shall happen and be continuing:
(i) Default in the payment of the principal and accrued interest on
this Debenture when and as the same shall become due and payable, whether by
acceleration or otherwise;
(ii) Default in the due observance or performance of any material
covenant, condition or agreement on the part of the Company to be observed or
performed pursuant to the terms hereof and such default shall continue uncured
for thirty (30) days after written notice thereof, specifying such default,
shall have been given to the Company by the holder of the Debenture;
(iii) Application for, or consent to, the appointment of a receiver,
trustee or liquidator of the Company or of its property;
-5-
<PAGE>
(iv) Admission in writing of the Company's inability to pay its debts
as they mature;
(v) General assignment by the Company for the benefit of creditors;
(vi) Filing by the Company of a voluntary petition in bankruptcy or a
petition or an answer seeking reorganization, or an arrangement with creditors;
(vii) Entering against the Company of a court order approving a
petition filed against it under the Federal bankruptcy laws, which order shall
not have been vacated or set aside or otherwise terminated within sixty (60)
days;
(viii) A material breach of the Company's representations contained in
the Subscription Agreement;
(ix) The sale by the Company of substantially all of its assets;
(x) The merger by the Company with or into another corporation, other
than for purposes of changing domicile, where the Company is not the surviving
corporation.
(ix) The failure of the Company to satisfy the obligations under
paragraph 8 hereof, provided however, that delivery by the Escrow Agent to the
Holder of the certificates pursuant to paragraph 8 shall be deemed to cure the
default.
2. The Company agrees that notice of the occurrence of any event of
default will be promptly given to the holder at his or her registered address by
certified mail.
3. In case any one or more of the events of default specified above
shall happen and be continuing, the holder of this Debenture may proceed to
protect and enforce his rights by suit in the specific performance of any
covenant or agreement contained in this Debenture or in aid of the exercise of
any power granted in this Debenture or may proceed to enforce the payment of
this Debenture or to enforce any other legal or equitable rights as such holder.
D. Miscellaneous
1. This Debenture has been issued by the Company pursuant to
authorization of the Board of Directors of the Company which provides for an
aggregate of up to $3,000,000 in face amount of identical Debentures to be
issued.
2. The Company may consider and treat the person in whose name this
Debenture shall be registered as the absolute owner thereof for all purposes
whatsoever (whether or not this Debenture shall be overdue) and the Company
shall not be affected by any notice to the contrary. The registered owner of
this Debenture shall have the right to transfer it by assignment (subject to the
-6-
<PAGE>
limitations on transfer contained in the Subscription Agreement) and the
transferee thereof shall, upon his registration as owner of this Debenture,
become vested with all the powers and rights of the transferor. Registration of
any new owner shall take place upon presentation of this Debenture to the
Company at its offices, 7 Kimball Lane, Building A, Lynnfield, Massachusetts
01940, together with a duly authenticated assignment. In case of transfer by
operation of law, the transferee agrees to notify the Company of such transfer
and of his address, and to submit appropriate evidence regarding the transfer so
that this Debenture may be registered in the name of the transferee. This
Debenture is transferable only on the books of the Company by the holder hereof,
in person or by attorney, on the surrender hereof, duly endorsed. Communications
sent to any registered owner shall be effective as against all holders or
transferees of the Debenture not registered at the time of sending the
communication.
3. Payment of principal and interest shall be made to the registered
owner of this Debenture upon presentation of this Debenture upon or after
maturity.
4. This Debenture shall be construed and enforced in accordance with
the laws of The Commonwealth of Massachusetts.
IN WITNESS WHEREOF, the Company has caused this Debenture to be signed
in its name by the undersigned.
Dated: , 1997
GREENMAN TECHNOLOGIES, INC.
By
Maurice E. Needham
Chief Executive Officer
-7-
<PAGE>
Exhibit A
FORM OF CONVERSION NOTICE
(To be signed only on conversion of Debenture)
TO: GreenMan Technologies, Inc.
The undersigned, the holder of the within Debenture, hereby irrevocably
elects to convert $_____ of the principal amount of the Debenture into shares of
Common Stock of GreenMan Technologies, Inc., a Delaware corporation, and
herewith delivers the Debenture as payment therefor, and requests that the
certificates for such shares to be issued in the name of, and delivered to
_______________ whose address is __________________________________.
The undersigned represents that it is not a U.S. Person as defined in
Regulation S promulgated under the Securities Act of 1933, as amended, and is
not converting the Debenture on behalf of any U.S. Person and the
representations contained in the Subscription Agreement are true as of the date
hereof.
Dated:
(Signature must conform to name of holder as specified on
the face of the Debenture)
(Address)
<PAGE>
FORM OF ASSIGNMENT
(To be signed only on transfer of Debenture)
For value received, the undersigned hereby sells, assigns, and
transfers unto _________________________________ the rights represented by the
within Debenture to receive payment of principal and interest owed under the
Debenture and the right to convert the Debenture into shares of Common Stock of
GreenMan Technologies, Inc., a Delaware corporation, and appoints
________________ Attorney to transfer such Debenture on the books of GreenMan
Technologies, Inc. a Delaware corporation, with full power of substitution in
the premises.
Dated:
(Signature must conform to name of holder as specified on
the face of the Warrant)
(Address)
Signed in the presence of :
THIS WARRANT HAS BEEN ACQUIRED FOR INVESTMENT PURPOSES ONLY, HAS NOT
BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE "1933 ACT"), AND MAY
NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES (AS DEFINED IN REGULATION S OF
THE 1933 ACT) OR TO, OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS (AS DEFINED
IN REGULATION S OF THE 1933 ACT) EXCEPT PURSUANT TO REGISTRATION UNDER OR AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT. THIS LEGEND SHALL
BE ENDORSED UPON ANY WARRANT ISSUED IN EXCHANGE FOR THIS WARRANT.
Warrant No.: _____ Right to Purchase _______
Shares of Common Stock of
January __, 1997 GreenMan Technologies, Inc.
VOID UNLESS EXERCISED BEFORE 5:00 P.M., EASTERN STANDARD TIME ON
JANUARY __, 1998.
GreenMan Technologies, Inc.
Common Stock Purchase Warrant
GreenMan Technologies, Inc., a Delaware corporation (the "Company"),
hereby certifies that, for value received, ________________ or assigns, is
entitled, subject to the terms set forth below, to purchase from the Company,
commencing January __, 1997, at any time or from time to time before 5:00 p.m.,
Eastern Standard Time, on or before January __, 1998, __________ fully paid and
nonassessable shares of Common Stock, $.01 par value, of the Company, at an
exercise price per share equal to $1.25. Such exercise price per share as
adjusted from time to time as herein provided is referred to herein as the
"Exercise Price." The number and character of such shares of Common Stock and
the Exercise Price are subject to adjustment as provided herein.
As used herein, the following terms, unless the context otherwise
requires, have the following respective meanings:
(a) The term "Company" shall include GreenMan Technologies, Inc., a
Delaware corporation, and any corporation which shall succeed or assume
the obligations of the Company hereunder.
<PAGE>
(b) The term "Common Stock" includes (a) the Company's Common Stock,
$.01 par value per share, as authorized, (b) any other capital stock of
any class or classes (however designated) of the Company, authorized on
or after such date, the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of
current dividends and liquidating dividends after the payment of
dividends and distributions on any shares entitled to preference, and
the holders of which shall ordinarily, in the absence of contingencies,
be entitled to vote for the election of a majority of directors of the
Company (even though the right so to vote has been suspended by the
happening of such a contingency), (c) any other securities into which
or for which any of the securities described in (a) or (b) may be
converted or exchanged pursuant to a plan of recapitalization,
reorganization, merger, sale of assets or otherwise, or the conversion
of promissory notes or other obligations of the Company.
(c) The term "Other Securities" refers to any stock (other than Common
Stock) and other securities of the Company or any other person
(corporate or otherwise) which the holder of this Warrant at any time
shall be entitled to receive, or shall have received, on the exercise
of the Warrant, in lieu of or in addition to Common Stock, or which at
any time shall be issuable or shall have been issued in exchange for or
in replacement of Other Securities pursuant to Sections 3 or 4 or
otherwise.
1. Exercise of Warrant.
1.1. Full Exercise. This Warrant may be exercised in full by
the holder hereof by surrender of this Warrant, with the form of subscription at
the end hereof duly executed by such holder, to the Company at its principal
office, accompanied by payment, in cash or by certified or official bank check
payable to the order of the Company, in the amount obtained by multiplying the
number of shares of Common Stock for which this Warrant is then exercisable by
the Exercise Price then in effect.
1.2 Partial Exercise. This Warrant may be exercised in part by
surrender of this Warrant in the manner and at the place provided in Section 1.1
except that the amount payable by the holder on such partial exercise shall be
the amount obtained by multiplying (a) the number of shares of Common Stock
designated by the holder in the subscription at the end hereof by (b) the
Exercise Price then in effect. On any such partial exercise, the Company at its
expense will forthwith issue and deliver to or upon the order of the holder
hereof a new Warrant or Warrants of like tenor, in the name of the holder hereof
or as such holder (upon payment by such holder of any applicable transfer taxes)
may request, calling in the aggregate on the face or faces thereof for the
number of shares of Common Stock for which such Warrant or Warrants may still be
exercised.
2. Delivery of Stock Certificates on Exercise. As soon as practicable
after the exercise of this Warrant in full or in part, and in any event within
sixty (60) days thereafter, the Company at its expense (including the payment by
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it of any applicable issue taxes) will cause to be issued in the name of and
delivered to the holder hereof, or as such holder (upon payment by such holder
of any applicable transfer taxes) may direct, a certificate or certificates for
the number of fully paid and nonassessable shares of Common Stock (or Other
Securities) to which such holder shall be entitled on such exercise, plus, in
lieu of any fractional share to which such holder would otherwise be entitled,
cash equal to such fraction multiplied by the then current market value of one
full share, together with any other stock or other securities and property
(including cash, where applicable) to which such holder is entitled upon such
exercise pursuant to Section 1 or otherwise.
3. Adjustment for Reorganization, Consolidation or Merger.
3.1 Reorganization, Consolidation or Merger. In case at any
time or from time to time, the Company shall (a) effect a reorganization, (b)
consolidate with or merge into any other person or entity, or (c) transfer all
or substantially all of its properties or assets to any other person under any
plan or arrangement contemplating the dissolution of the Company, then, in each
such case, the holder of the Warrant, on the exercise hereof as provided in
Section 1 at any time after the consummation of such reorganization,
consolidation or merger or the effective date of such dissolution, as the case
may be, shall receive, in lieu of the Common Stock (or Other Securities)
issuable on such exercise prior to such consummation or such effective date, the
stock and other securities and property (including cash) to which such holder
would have been entitled upon such consummation or in connection with such
dissolution, as the case may be, if such holder had so exercised this Warrant,
immediately prior thereto, all subject to further adjustment thereafter as
provided in Sections 4 and 5.
3.2 Continuation of Terms. Upon any reorganization,
consolidation, merger or transfer (and any dissolution following any transfer)
referred to in this Section 3, this Warrant shall continue in full force and
effect and the terms hereof shall be applicable to the shares of stock and Other
Securities and property receivable on the exercise of the Warrant after the
consummation of such reorganization, consolidation or merger or the effective
date of dissolution following any such transfer, as the case may be, and shall
be binding upon the issuer of any such stock or other securities, including, in
the case of any such transfer, the person acquiring all or substantially all of
the properties or assets of the Company, whether or not such person shall have
expressly assumed the terms of this Warrant.
4. Adjustments for Stock Dividends and Stock Splits. In the event that
the Company shall (i) issue additional shares of Common Stock as a dividend or
other distribution on outstanding Common Stock, (ii) subdivide its outstanding
shares of Common Stock, or (iii) combine its outstanding shares of the Common
Stock into a smaller number of shares of the Common Stock, then, in each such
event, the Exercise Price shall, simultaneously with the happening of such
event, be adjusted by multiplying the then prevailing Exercise Price by a
fraction, the numerator of which shall be the number of shares of Common Stock
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outstanding immediately prior to such event (calculated assuming the conversion
or exchange of all outstanding shares of convertible or exchangeable securities
of the Company which are convertible or exchangeable into, or exercisable for,
shares of Common Stock) and the denominator of which shall be the number of
shares of Common Stock outstanding immediately after such event (calculated
assuming the conversion or exchange of all outstanding shares of convertible or
exchangeable securities of the Company which are convertible or exchangeable
into, or exercisable for, shares of Common Stock), and the product so obtained
shall thereafter be the Exercise Price then in effect. The Exercise Price, as so
adjusted, shall be readjusted in the same manner upon the happening of any
successive event or events described herein in this Section 4. The holder of
this Warrant shall thereafter, on the exercise hereof as provided in Section 1,
be entitled to receive that number of shares of Common Stock determined by
multiplying the number of shares of Common Stock which would otherwise (but for
the provisions of this Section 4) be issuable on such exercise, by a fraction of
which (i) the numerator is the Exercise Price which would otherwise (but for the
provisions of this Section 4) be in effect, and (ii) the denominator is the
Exercise Price in effect on the date of such exercise.
5. Adjustment for Dividends in Other Stock, Property and
Reclassifications. In case at any time or from time to time, the holders of
Common Stock (or Other Securities) shall have received, or (on or after the
record date fixed for the determination of stockholders eligible to receive)
shall have become entitled to receive, without payment therefor,
(a) other or additional stock or other securities or property (other
than cash) by way of dividend, or
(b) other or additional stock or other securities or property
(including cash) by way of spin-off, split-up, reclassification,
recapitalization, combination of shares or similar corporate
rearrangement,
other than additional shares of Common Stock (or Other Securities) issued as a
stock dividend or in a stock-split (adjustments in respect of which, in the case
of Common Stock, are provided for in Section 4), then and in each such case the
holder of this Warrant, on the exercise hereof as provided in Section 1, shall
be entitled to receive the amount of other or additional stock and other
securities and property (including cash in the cases referred to in subdivision
(b) of this Section 5) which such holder would hold on the date of such exercise
if on the date of distribution of such other or additional stock or other
securities and property, or on the record date fixed for determining the
shareholders entitled to receive such other or additional stock or other
securities and property, such holder had been the holder of record of the number
of shares of Common Stock called for on the face of this Warrant and had
thereafter, during the period from the date thereof to and including the date of
such exercise, retained such shares and all such other or additional stock and
other securities and property (including cash in the cases referred to in
subdivision (b) of this Section 5) receivable by such holder as aforesaid during
such period, giving effect to all adjustments called for during such period by
Sections 3 and 4.
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6. Notices of Record Date. In the event of
(a) any taking by the Company of a record of the holders of any class
or securities for the purpose of determining the holders thereof who
are entitled to receive any dividend or other distribution, or any
right to subscribe for, purchase or otherwise acquire any shares of
stock of any class or any other securities or property, or to receive
any other right, or
(b) any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any transfer of
all or substantially all the assets of the Company to or consolidation
or merger of the Company with or into any other person, or
(c) any voluntary or involuntary dissolution, liquidation or winding-up
of the Company,
then and in each such event the Company will mail or cause to be mailed to the
holder of this Warrant a notice specifying (i) the date on which any such record
is to be taken for the purpose of such dividend, distribution or right, and
stating the amount and character of such dividend, distribution or right, and
(ii) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up is to take place, and the time, if any is to be fixed, as of which
the holders of record of Common Stock (or Other Securities) shall be entitled to
exchange their shares of Common Stock (or Other Securities) for securities or
other property deliverable on such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up. Such notice shall be mailed at least twenty (20) days prior to the
date specified in such notice on which any such action is to be taken.
7. Reservation of Stock Issuable on Exercise on Warrant. The Company
will at all times reserve and keep available, solely for issuance and delivery
on the exercise of the Warrant, all shares of Common Stock (or Other Securities)
from time to time issuable on the exercise of the Warrant; the shares of Common
Stock which the holder of this Warrant shall receive upon exercise of the
Warrant will be duly authorized, validly issued, fully paid and non-assessable.
8. Exchange of Warrant. On surrender for exchange of this Warrant,
properly endorsed, to the Company, the Company at its expense will issue and
deliver to or on the order of the holder thereof a new Warrant or Warrants of
like tenor, in the name of such holder or as such holder (on payment by such
holder of any applicable transfer taxes) may direct, calling in the aggregate on
the face or faces thereof for the number of shares of Common Stock called for on
the face or faces of the Warrant or Warrants so surrendered.
9. Replacement of Warrant. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of any such loss, theft or destruction of this
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Warrant, on delivery of an indemnity agreement or security reasonably
satisfactory in form and amount to the Company or, in the case of any such
mutilation, on surrender and cancellation of such Warrant, the Company at its
expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.
10. Warrantholder Not Deemed Stockholder; Restrictions on Transfer.
This Warrant is issued upon the following terms, to all of which each holder or
owner hereof by the taking hereof consents and agrees:
(a) No holder of this Warrant shall, as such, be deemed the holder of
Common Stock that may at any time be issuable upon exercise of this
Warrant for any purpose whatsoever, nor shall anything contained herein
be construed to confer upon such holder, as such, any of the rights of
a stockholder of the Company until such holder shall have exercised the
Warrant and been issued shares of Common Stock in accordance with the
provisions hereof.
(b) Neither this Warrant nor any shares of Common Stock purchased
pursuant to this Warrant shall be registered under the Securities Act
of 1933 (the "Securities Act") and applicable state securities laws.
Therefore, the Company may require, as a condition of allowing the
transfer or exchange of this Warrant or such shares, that the holder or
transferee of this Warrant or such shares, as the case may be, furnish
to the Company an opinion of counsel acceptable to the Company to the
effect that such transfer or exchange may be made without registration
under the Securities Act and applicable state securities laws. The
certificates evidencing the shares of Common Stock issued on the
exercise of the Warrant shall bear a legend to the effect that the
shares evidenced by such certificates have not been registered under
the Securities Act and applicable state securities laws.
(c) This Warrant is not transferable or assignable to any party without
the prior written consent of the Company and an opinion of counsel
satisfactory to the Company that such transfer is permissible under
applicable law.
11. Notices. All notices and other communications from the Company to
the holder of this Warrant shall be mailed by (i) first class mail, postage
prepaid, (ii) electronic facsimile transmission, or (iii) express overnight
courier service, at such address as may have been furnished to the Company in
writing by such holder or, until any such holder furnishes to the Company an
address, then to, and at the address of, the last holder of this Warrant who has
so furnished an address to the Company.
12. Lock-Up Agreement for Public Offering. In connection with any
public offering of equity securities of the Company, the Warrantholder agrees
not to sell, pledge, transfer or otherwise dispose of, or grant any option or
purchase right with respect to, any shares of capital stock then owned by him
and not otherwise offered in the public offering, or engage in any short sale,
hedging transaction or other derivative security transaction involving the
Common Stock, or other shares of Common Stock of the Company held by him, for
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such period of time commencing 30 days prior to the proposed effective date of
such public offering until such period of time following the offering as the
Company and the managing underwriter of such public offering deem necessary in
order to ensure a stable and orderly trading market.
13. Miscellaneous. This Warrant and any term hereof may be changed,
waived, discharged or terminated only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought. This Warrant and the shares of Common Stock underlying this Warrant
shall be construed and enforced in accordance with and governed by the laws of
the State of Delaware. The headings in this Warrant are for purposes of
reference only, and shall not limit or otherwise affect any of the terms hereof.
The invalidity or unenforceability of any provision hereof shall in no way
affect the validity or enforceability of any other provision.
14. Expiration. The right to exercise this Warrant shall expire at 5:00
p.m., Eastern Standard Time, on January 9, 1998.
Dated: January 10, 1997
ATTEST: GREENMAN TECHNOLOGIES, INC.
By:__________________________ By:___________________________
Title: Assistant Secretary Title: Chief Executive Officer
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FORM OF SUBSCRIPTION
(To be signed only on exercise of Warrant)
To GreenMan Technologies, Inc.
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise this Warrant for, and to purchase thereunder, ____________
shares of Common Stock of GreenMan Technologies, Inc., a Delaware corporation,
and herewith makes payment of $____________ therefor, and requests that the
certificates for such shares be issued in the name of, and delivered to
_________________________, whose address is _________________________.
The undersigned represents that it is not a U.S. Person as defined in
Regulation S promulgated under the Securities Act of 1933, as amended, and is
not converting the Debenture on behalf of any U.S. Person and the
representations contained in the Subscription Agreement are true as of the date
hereof.
Dated:
(Signature must conform to name of holder as specified
on the face of the Warrant)
(Address)
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FORM OF ASSIGNMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and
transfers unto _________________________ the right represented by the within
Warrant to purchase ____________ shares of Common Stock of GreenMan
Technologies, Inc., a Delaware corporation, to which the within Warrant relates,
and appoints _________________________ Attorney to transfer such right on the
books of GreenMan Technologies, Inc., a Delaware corporation, with full power of
substitution in the premises.
Dated:
(Signature must conform to name of holder as specified
on the face of the Warrant)
(Address)
Signed in the presence of:
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