EXHIBIT 4.3
DATED 30 November 2005
CANADIAN SOLAR INC.
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REGISTRATION RIGHTS AGREEMENT
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▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
TABLE OF CONTENTS
1. Applicability of Rights................................................ 1
2. Definitions............................................................ 1
3. Demand Registration.................................................... 3
4. Piggyback Registrations................................................ 5
5. Form S-3 or Form F-3 Registration...................................... 6
6. Expenses............................................................... 7
7. Obligations of the Company............................................. 8
8. Furnish Information.................................................... 9
9. Indemnification........................................................ 10
10. Termination of the Company's Obligations............................... 12
11. No Registration Rights to Third Parties................................ 12
12. Market Stand-Off....................................................... 13
13. Rule 144 Reporting..................................................... 13
14. Transfer of Registration Rights........................................ 13
15. Miscellaneous.......................................................... 14
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made as of
the 30 day of November, 2005, by and among Canadian Solar Inc., a corporation
incorporated under the laws of the Province of Ontario, Canada (the "Company"),
QU ▇▇▇▇ ▇▇▇, an individual holding Canadian passport no.▇▇▇▇▇▇▇▇ (the "Founder")
and the investors listed on Schedule A hereto (the "Investor").
RECITALS
WHEREAS, each Investor is a party to a Subscription Agreement dated 16
November 2005 (the "Subscription Agreement") between, among others, the Company
and the Investor, pursuant to which the Investor is subscribing for convertible
notes (the "Convertible Notes") of the Company;
WHEREAS, in order to induce the Company to enter into the Subscription
Agreement and to induce the Investors to invest funds in the Company pursuant to
the Subscription Agreement, the Investors and the Company hereby agree that this
Agreement shall govern the rights of the Investor to cause the Company to
register Common Shares issuable to such persons, and certain other matters as
set forth herein;
WHEREAS, the Investors and the Company have agreed, pursuant to the
Subscription Agreement, to enter into this Agreement;
NOW, THEREFORE, in consideration of the promises, covenants, and
conditions set forth herein, the parties hereto hereby agree as follows:
1. Applicability of Rights. The Holders shall be entitled to the following
rights with respect to any proposed public offering of the Company's Common
Shares in the United States.
2. Definitions. For the purpose of this Agreement:
2.1 Business Day. The term means any day (excluding Saturdays, Sundays and
public holidays) on which banks generally are open for business in
Hong Kong and Singapore.
2.2 Claim. The term means any claim, demand, assessment, judgment, order,
decree, action, cause of action, litigation, suit, investigation or
other legal, administrative or arbitration action, suit, complaint,
charge, hearing, inquiry, investigation or proceeding (including any
partial or threatened proceedings).
2.3 Common Shares. The term means the common shares in the share capital
of the Company.
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2.4 Exchange Act. The term means the U.S. Securities Exchange Act of 1934,
as amended.
2.5 Form S-3 and Form F-3. The terms mean such respective forms under the
Securities Act or any successor registration form under the Securities
Act subsequently adopted by the SEC that permits inclusion or
incorporation of substantial information by reference to other
documents filed by the Company with the SEC.
2.6 Holder. The term means any Person owning Registrable Securities or any
permitted assignee of record of such Registrable Securities to whom
rights under this Agreement have been duly assigned.
2.7 IPO. The term means the initial public offering of the shares of the
Company or ListCo.
2.8 ListCo. The term means a new holding company of the Company to be
incorporated in a jurisdiction acceptable for the purpose of an IPO
and the shares of which will be offered in the IPO.
2.9 Majority. The term in this Agreement refers to at least seventy-five
per cent. (75%).
2.10 Person. The term means any natural person, company, corporation,
association, partnership, organization, firm, joint venture, trust,
unincorporated organization or any other entity or organization, and
shall include any governmental authority.
2.11 Qualified IPO. The term means a fully underwritten IPO on the main
board of The Stock Exchange of Hong Kong Limited, the Nasdaq National
Market or another international stock exchange approved in writing by
the Majority of all outstanding Convertible Notes, where (a) the
offering size (net of all related expenses and underwriting discounts
and commissions) being not less than Thirty Million United States
Dollars (US$30,000,000), (b) the total market capitalization of the
Company or ListCo (as the case may be) immediately following the
offering being not less than ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ Dollars (US$120,000,000) and (c) the public float immediately
following the offering being not less than twenty-five per cent. (25%)
of the enlarged share capital of the Company or ListCo (as the case
may be).
2.12 Registrable Securities. The term means any Common Shares of the
Company issued or issuable to the Investors or their assigns pursuant
to conversion of any Convertible Notes held by the Investors and
includes such securities of the Company issued with respect to the
aforesaid securities through stock splits, subdivisions,
reclassification, exchange, substitution or similar events.
Notwithstanding the foregoing, "Registrable Securities" shall exclude
any Registrable Securities which are sold in a registered public
offering under the Securities Act or analogous statute of another
jurisdiction, or sold pursuant to Rule 144 promulgated under the
Securities Act or analogous rule of another jurisdiction.
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2.13 Registrable Securities then Outstanding. The number of shares of
"Registrable Securities then outstanding" shall mean the number of
Common Shares of the Company that are Registrable Securities and are
then issued and outstanding, issuable upon conversion of Convertible
Notes then issued and outstanding.
2.14 Registration. The terms "register," "registered," and "registration"
refer to a registration effected by filing a registration statement
which is in a form that complies with, and is declared effective by
the SEC in accordance with, the Securities Act.
2.15 SEC. The term means the United States Securities and Exchange
Commission.
2.16 Securities Act. The term means the U.S. Securities Act of 1933, as
amended.
2.17 Registration Expenses. The term means all expenses incurred by the
Company in complying with Clauses 3, 4 and 5 hereof, including,
without limitation, all registration and filing fees, printing
expenses, fees, and disbursements of counsel for the Company,
reasonable fees and disbursements of one counsel for the Holders,
"blue sky" fees and expenses, the expense of any special audits
incident to or required by any such registration, any fee charged by
any depositary bank, transfer agent or share registrar (but excluding
the compensation of regular employees of the Company which shall be
paid in any event by the Company).
2.18 Selling Expenses. The term means all underwriting discounts and
selling commissions applicable to the sale of Registrable Securities
pursuant to Clauses 3, 4 and 5 hereof.
2.19 Transfer. The term (or any correlative term) means a sale, assignment,
pledge, charge, mortgage, hypothecation, gift, placement in trust
(voting or otherwise) or transfer by operation of law of, creation of
a security interest in, or lien on, or any other encumbering or
disposal (directly or indirectly and whether or not voluntary), and
shall include any transfer by will or intestate succession.
3. Demand Registration.
3.1 Request by Holders. If the Company shall, at any time after six (6)
months following the closing of a Qualified IPO in the United States
on either the New York Stock Exchange or the Nasdaq National Market,
receive a written request from the Holders of at least 25% of the
Registrable Securities then Outstanding that the Company file a
registration statement under the Securities Act covering the
registration of Registrable Securities pursuant to this Clause 3, then
the Company shall, within ten (10) Business Days of the receipt of
such written request, deliver written notice of such request (the
"REQUEST NOTICE") to all Holders, and use its best efforts to effect,
as soon as practicable, the registration under the Securities Act of
all Registrable Securities that the Holders request to be registered
and included in such registration by written notice delivered by such
Holders to the Company within twenty (20) days after receipt of the
Request Notice, subject only to the limitations of this Clause 3;
provided that the Company shall not be obligated to effect any such
registration if the
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Company has, within the preceding twelve (12) month period, already
effected two or more registrations under the Securities Act pursuant
to this Clause 3 or Clause 5 in which the Holders had an opportunity
to participate pursuant to the provisions of Clause 4, other than a
registration from which the Registrable Securities of the Holders have
been excluded (with respect to all or any portion of the Registrable
Securities the Holders requested be included in such registration)
pursuant to the provisions of Clause 4.1.
3.2 Underwriting. If the Holders initiating the registration request under
this Clause 3 (the "INITIATING HOLDERS") intend to distribute the
Registrable Securities included in their request by means of an
underwriting, then they shall so advise the Company as a part of their
request made pursuant to this Clause 3 and the Company shall include
such information in the Request Notice. In such event, the right of
any Holder to include its Registrable Securities in such registration
shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities
in the underwriting (unless otherwise mutually agreed by a Majority in
interest of the Initiating Holders and such Holder) to the extent
provided herein. All Holders proposing to distribute their securities
through such underwriting shall enter into an underwriting agreement
in customary form with the managing underwriter or underwriters
selected for such underwriting by the Holders of a Majority of the
Registrable Securities being registered and reasonably acceptable to
the Company. Notwithstanding any other provision of this Clause 3, if
the underwriter(s) advise(s) the Company in writing that marketing
factors require a limitation of the number of securities to be
underwritten, then the Company shall so advise all Holders of
Registrable Securities which would otherwise be registered and
underwritten pursuant hereto, and the number of Registrable Securities
that may be included in the underwriting shall be reduced as required
by the underwriter(s) and allocated among the Holders of Registrable
Securities on a pro rata basis according to the number of Registrable
Securities then Outstanding held by each Holder requesting
registration (including the Initiating Holders); provided, however,
that the number of shares of Registrable Securities to be included in
such underwriting and registration shall not be reduced unless all
other securities are first entirely excluded from the underwriting and
registration including, without limitation, all Shares that are not
Registrable Securities and are held by any other Person, including,
without limitation, any Person who is an employee, officer or director
of the Company or any subsidiary of the Company; provided further,
that at least twenty-five percent (25)% of shares of Registrable
Securities requested by the Holders to be included in such
underwriting and registration shall be so included. If any Holder
disapproves of the terms of any such underwriting, such Holder may
elect to withdraw therefrom by written notice to the Company and the
underwriter(s), delivered at least ten (10) Business Days prior to the
effective date of the registration statement. Any Registrable
Securities excluded or withdrawn from such underwriting shall be
excluded and withdrawn from the registration.
3.3 Maximum Number of Demand Registrations. The Company shall not be
obligated to effect more than three (3) such demand registrations
pursuant to this Clause 3.
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3.4 Deferral. Notwithstanding the foregoing, if the Company shall furnish
to Holders requesting registration pursuant to this Clause 3, a
certificate signed by the president or chief executive officer of the
Company stating that in the good faith judgment of the board of
directors of the Company, it would be materially detrimental to the
Company and its shareholders for such registration statement to be
filed at such time, then the Company shall have the right to defer
such filing for a period of not more than 120 days after receipt of
the request of the Initiating Holders; provided, however, that the
Company may not utilize this right more than once in any twelve (12)
month period; provided further, that the Company shall not register
any other of its Shares during such twelve (12) month period. A demand
right shall not be deemed to have been exercised until such deferred
registration shall have been effected.
4. Piggyback Registrations.
4.1 The Company shall notify all Holders of Registrable Securities in
writing at least thirty (30) days prior to filing any registration
statement under the Securities Act for purposes of effecting a public
offering of securities of the Company (including, but not limited to,
registration statements relating to secondary offerings of securities
of the Company, but excluding registration statements relating to any
registration under Clause 3 or Clause 5 of this Agreement or to any
employee benefit plan or a corporate reorganization), and shall afford
each such Holder an opportunity to include in such registration
statement all or any part of the Registrable Securities then held by
such Holder. Each Holder desiring to include in any such registration
statement all or any part of the Registrable Securities held by it
shall within twenty (20) days after receipt of the above-described
notice from the Company, so notify the Company in writing, and in such
notice shall inform the Company of the number of Registrable
Securities such Holder wishes to include in such registration
statement. If a Holder decides not to include all of its Registrable
Securities in any registration statement thereafter filed by the
Company, such Holder shall nevertheless continue to have the right to
include any Registrable Securities in any subsequent registration
statement or registration statements as may be filed by the Company
with respect to offerings of its securities, all upon the terms and
conditions set forth herein.
4.2 Underwriting. If a registration statement under which the Company
gives notice under this Clause 4 is for an underwritten offering, then
the Company shall so advise the Holders of Registrable Securities. In
such event, the right of any such Holder's Registrable Securities to
be included in a registration pursuant to this Clause 4 shall be
conditioned upon such Holder's participation in such underwriting and
the inclusion of such Holder's Registrable Securities in the
underwriting to the extent provided herein. All Holders proposing to
distribute their Registrable Securities through such underwriting
shall enter into an underwriting agreement in customary form with the
managing underwriter or underwriters selected for such underwriting.
Notwithstanding any other provision of this Agreement but subject to
Clause 12, if the managing underwriter(s) determine(s) in good faith
that marketing factors require a limitation of the number of shares to
be underwritten, then the managing underwriter(s) may exclude shares
from the registration and the underwriting, and the number of shares
that may be included in the registration and the underwriting shall
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be allocated, first, to the Company, second, to each of the Holders
requesting inclusion of their Registrable Securities in such
registration statement on a pro rata basis based on the total number
of shares of Registrable Securities then held by each such Holder, and
third, to holders of other securities of the Company; provided,
however, that the right of the underwriter(s) to exclude shares
(including Registrable Securities) from the registration and
underwriting as described above shall be restricted so that (i) the
number of Registrable Securities included in any such registration is
not reduced below twenty-five percent (25%) of the aggregate number of
shares of Registrable Securities for which inclusion has been
requested; and (ii) all shares that are not Registrable Securities and
are held by any other Person, including, without limitation, any
Person who is an employee, officer or director of the Company (or any
subsidiary of the Company) shall first be excluded from such
registration and underwriting before any Registrable Securities are so
excluded. If any Holder disapproves of the terms of any such
underwriting, such Holder may elect to withdraw therefrom by written
notice to the Company and the underwriter(s), delivered at least ten
(10) Business Days prior to the effective date of the registration
statement. Any Registrable Securities excluded or withdrawn from such
underwriting shall be excluded and withdrawn from the registration.
4.3 Not Demand Registration. Registration pursuant to this Clause 4 shall
not be deemed to be a demand registration as described in Clause 3
above. There shall be no limit on the number of times the Holders may
request registration of Registrable Securities under this Clause 4.
5. Form S-3 or Form F-3 Registration. In case the Company shall receive from
any Holder or Holders of a Majority of all Registrable Securities then
outstanding a written request or requests that the Company effect a
registration on Form S-3 or Form F-3 and any related qualification or
compliance with respect to all or a part of the Registrable Securities
owned by such Holder or Holders, then the Company will:
5.1 Notice. Promptly deliver written notice of the proposed registration
and the Holder's or Holders' request therefor, and any related
qualification or compliance, to all other Holders of Registrable
Securities; and
5.2 Registration. As soon as practicable, effect such registration and all
such qualifications and compliances as may be so requested and as
would permit or facilitate the sale and distribution of all or such
portion of such Holders or Holders' Registrable Securities as are
specified in such request, together with all or such portion of the
Registrable Securities of any other Holder or Holders joining in such
request as are specified in a written request delivered within twenty
(20) days after the Company provides the notice contemplated by Clause
5.1; provided, however, that the Company shall not be obligated to
effect any such registration, qualification or compliance pursuant to
this Clause 5:
5.2.1 if Form S-3 or Form F-3 is not available for such offering by
the Holders;
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5.2.2 if the Holders, together with the holders of any other
securities of the Company entitled to inclusion in such
registration, propose to sell Registrable Securities and such
other securities (if any) at an aggregate price to the public of
less than US$1,000,000;
5.2.3 if the Company shall furnish to the Holders a certificate signed
by the president or chief executive officer of the Company
stating that in the good faith judgment of the board of directors
of the Company, it would be materially detrimental to the Company
and its shareholders for such Form S-3 or Form F-3 Registration
to be effected at such time, in which event the Company shall
have the right to defer the filing of the Form S-3 or Form F-3
registration statement no more than once during any twelve (12)
month period for a period of not more than 120 days after receipt
of the request of the Holder or Holders under this Clause 5;
provided that the Company shall not register any of its other
shares during such 120 day period;
5.2.4 if the Company has, within the six (6) month period preceding
the date of such request, already effected a registration under
the Securities Act other than a registration from which the
Registrable Securities of Holders have been excluded (with
respect to all or any portion of the Registrable Securities the
Holders requested be included in such registration) pursuant to
the provisions of Clauses 3.2 and 4.1; or
5.2.5 in any particular jurisdiction in which the Company would be
required to qualify to do business or to execute a general
consent to service of process in effecting such registration,
qualification or compliance.
Subject to the foregoing, the Company shall file a Form S-3 or Form
F-3 registration statement covering the Registrable Securities and
other securities so requested to be registered as soon as practicable
after receipt of the request or requests of the Holders.
5.3 Not Demand Registration. Form S-3 or Form F-3 registrations shall not
be deemed to be demand registrations as described in Clause 3 above.
Except as otherwise provided herein, there shall be no limit on the
number of times the Holders may request registration of Registrable
Securities under this Clause 5.
6. Expenses. All Registration Expenses incurred in connection with any
registration pursuant to Clauses 3, 4 or 5 (but excluding Selling Expenses)
shall be borne by the Company. Each Holder participating in a registration
pursuant to Clauses 3, 4 or 5 shall bear such Holder's proportionate share
(based on the total number of shares sold in such registration other than
for the account of the Company) of all Selling Expenses or other amounts
payable to underwriter(s) or brokers, in connection with such offering by
the Holders. Notwithstanding the foregoing, the Company shall not be
required to pay for any expenses of any registration proceeding begun
pursuant to Clause 3 if the registration request is subsequently withdrawn
at the request of the Holders of a Majority of the Registrable Securities
to be registered, unless the Holders of a Majority of the Registrable
Securities then outstanding agree that such registration constitutes the
use by the Holders of one (1) demand registration pursuant to
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Clause 3 (in which case such registration shall also constitute the use by
all Holders of Registrable Securities of one (1) such demand registration).
Notwithstanding the foregoing, if at the time of such withdrawal, the
Holders have learned of a material adverse change in the condition,
business, or prospects of the Company due to acts, omissions, or events
within the Company's control that were not known to the Holders at the time
of their request for such registration and have withdrawn their request for
registration with reasonable promptness after learning of such material
adverse change, then the Holders shall not be required to pay any of such
expenses and such registration request shall not constitute the use of a
demand registration pursuant to Clause 3. If the Holders have learned of a
material adverse change in the condition, business, or prospects of the
Company due to acts, omissions, or events beyond the Company's control that
were not known to the Holders at the time of their request for such
registration and have withdrawn their request for registration with
reasonable promptness after learning of such material adverse change, then
the Company, on the one hand, and the Holders, on the other hand, shall pay
any such expenses on an equal basis and such registration request shall not
constitute the use of a demand registration pursuant to Clause 3.
7. Obligations of the Company. Whenever required to effect the registration of
any Registrable Securities under this Agreement the Company shall, as
expeditiously as reasonably possible:
7.1 Registration Statement. Prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use its best
efforts to cause such registration statement to become effective, and,
upon the request of the Holders of a Majority of the Registrable
Securities registered thereunder, keep such registration statement
effective for a period of up to ninety (90) days or, in the case of
Registrable Securities registered under Form S-3 or Form F-3 in
accordance with Rule 415 under the Securities Act or a successor rule,
until the distribution contemplated in the registration statement has
been completed; provided, however, that (i) such ninety (90) day
period shall be extended for a period of time equal to the period any
Holder refrains from selling any securities included in such
registration at the request of the underwriter(s), and (ii) in the
case of any registration of Registrable Securities on Form S-3 or Form
F-3 which are intended to be offered on a continuous or delayed basis,
such ninety (90) day period shall be extended, if necessary, to keep
the registration statement effective until all such Registrable
Securities are sold.
7.2 Amendments and Supplements. Prepare and file with the SEC such
amendments and supplements to such registration statement and the
prospectus used in connection with such registration statement as may
be necessary to comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such
registration statement.
7.3 Prospectuses. Furnish to the Holders such number of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as they
may reasonably request in order to facilitate the disposition of the
Registrable Securities owned by them that are included in such
registration.
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7.4 Blue Sky. Use its best efforts to register or qualify the securities
covered by such registration statement under such other securities or
"blue sky" laws of such jurisdictions as shall be reasonably requested
by the Holders, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do
business in any jurisdiction where it would not otherwise be required
to qualify but for this Clause 7.4, to subject itself to taxation in
any such jurisdiction or consent to service of process in any such
jurisdiction, unless the Company is already subject to service in such
jurisdiction.
7.5 Underwriting. In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement in
usual and customary form, with the managing underwriter(s) of such
offering. Each Holder participating in such underwriting shall also
enter into and perform its obligations under such an agreement.
7.6 Notification. Notify each Holder of Registrable Securities covered by
such registration statement at any time when a prospectus relating
thereto is required to be delivered under the Securities Act of (i)
the issuance of any stop order by the SEC in respect of such
registration statement, or (ii) the happening of any event as a result
of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light
of the circumstances then existing.
7.7 Opinion and Comfort Letter. Furnish, at the request of any Holder
requesting registration of Registrable Securities, on the date that
such Registrable Securities are delivered to the underwriter(s) for
sale, if such securities are being sold through underwriters, or, if
such securities are not being sold through underwriters, on the date
that the registration statement with respect to such securities
becomes effective, (i) an opinion, dated as of such date, of the
counsel representing the Company for the purposes of such
registration, in form and substance as is customarily given to
underwriters in an underwritten public offering and reasonably
satisfactory to a Majority in interest of the Holders requesting
registration, addressed to the underwriters, if any, and to the
Holders requesting registration of Registrable Securities and (ii)
letters dated as of (x) the effective date of the registration
statement covering such Registrable Securities and (y) the closing
date of the offering, from the independent certified public
accountants of the Company, in form and substance as is customarily
given by independent certified public accountants to underwriters in
an underwritten public offering and reasonably satisfactory to a
Majority in interest of the Holders requesting registration, addressed
to the underwriters, if any, and to the Holders requesting
registration of Registrable Securities.
8. Furnish Information. It shall be a condition precedent to the obligations
of the Company to take any action pursuant to Clauses 3, 4 or 5 that the
selling Holders shall furnish to the Company such information regarding
themselves, the Registrable Securities held by them and the intended method
of disposition of such securities as shall be required to timely effect the
Registration of their Registrable Securities.
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9. Indemnification. In the event any Registrable Securities are included in a
registration statement under Clauses 3, 4 or 5:
9.1 By the Company. To the extent permitted by law, the Company will
indemnify and hold harmless each Holder, its partners, officers,
directors, legal counsel, any underwriter (as defined in the
Securities Act) for such Holder and each Person, if any, who controls
such Holder or underwriter within the meaning of the Securities Act or
the Exchange Act (each a "CONTROLLING PERSON"), against any losses,
Claims, damages, or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act, or other
U.S. federal or state law, insofar as such losses, Claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based
upon any of the following statements, omissions or violations
(collectively a "VIOLATION"):
9.1.1 any untrue statement or alleged untrue statement of a material
fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto;
9.1.2 the omission or alleged omission to state therein a material
fact required to be stated therein, or necessary to make the
statements therein not misleading; or
9.1.3 any violation or alleged violation by the Company of the
Securities Act, the Exchange Act, any U.S. federal or state
securities law, or any rule or regulation promulgated under the
Securities Act, the Exchange Act, or any U.S. federal or state
securities law in connection with the offering covered by such
registration statement;
and the Company will reimburse each such Holder, its partner, officer,
director, legal counsel, underwriter or Controlling Person for any
legal or other expenses reasonably incurred by them, as such expenses
are incurred, in connection with investigating or defending any such
loss, Claim, damage, liability or action; provided, however, that the
indemnity agreement contained in this Clause 9.1 shall not apply to
amounts paid in settlement of any such loss, Claim, damage, liability
or action if such settlement is effected without the consent of the
Company (which consent shall not be unreasonably withheld), nor shall
the Company be liable in any such case for any such loss, Claim,
damage, liability or action to the extent (and only to the extent)
that it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information furnished
expressly for use in connection with such registration by such Holder,
partner, officer, director, legal counsel, underwriter or Controlling
Person of such Holder.
9.2 By Selling Holders. To the extent permitted by law, each selling
Holder will, if Registrable Securities held by Holder are included in
the securities as to which such registration qualifications or
compliance is being effected, indemnify and hold harmless the Company,
each of its directors, each of its officers who has signed the
registration statement, each Person, if any, who controls the Company
within the meaning of the Securities Act, any underwriter and any
other Holder selling securities
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under such registration statement or any of such other Holder's
partners, directors, officers, legal counsel, or any Person who
controls such Holder within the meaning of the Securities Act or the
Exchange Act, against any losses, Claims, damages or liabilities
(joint or several) to which the Company or any such director, officer,
legal counsel, Controlling Person, underwriter or other such Holder,
partner or director, officer or Controlling Person of such other
Holder may become subject under the Securities Act, the Exchange Act
or other U.S. federal or state law, insofar as such losses, Claims,
damages or liabilities (or actions in respect thereto) arise out of or
are based upon any Violation, in each case to the extent (and only to
the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Holder expressly
for use in connection with such registration; and each such Holder
will reimburse any legal or other expenses reasonably incurred by the
Company or any such director, officer, Controlling Person, underwriter
or other Holder, partner, officer, director or Controlling Person of
such other Holder in connection with investigating or defending any
such loss, Claim, damage, liability or action; provided, however, that
the indemnity agreement contained in this Clause 9.2 shall not apply
to amounts paid in settlement of any such loss, Claim, damage,
liability or action if such settlement is effected without the consent
of the Holder, which consent shall not be unreasonably withheld; and
provided, further, that in no event shall any indemnity under this
Clause 9.2 exceed the net proceeds received by such Holder in the
registered offering out of which the applicable Violation arises.
9.3 Notice. Promptly after receipt by an indemnified party under this
Clause 9 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party under
this Clause 9, deliver to the indemnifying party a written notice of
the commencement thereof and the indemnifying party shall have the
right to participate in, and, to the extent the indemnifying party so
desires, jointly with any other indemnifying party similarly noticed,
to assume the defense thereof with counsel mutually satisfactory to
the parties in their reasonable judgment; provided, however, that an
indemnified party shall have the right to retain its own counsel, with
the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by
the indemnifying party would be inappropriate due to actual or
potential conflict of interests between such indemnified party and any
other party represented by such counsel in such proceeding. The
failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall relieve
such indemnifying party of liability to the indemnified party under
this Clause 9 to the extent the indemnifying party is prejudiced as a
result thereof, but the omission to so deliver written notice to the
indemnifying party will not relieve it of any liability that it may
have to any indemnified party otherwise than under this Clause 9.
9.4 Contribution. In order to provide for just and equitable contribution
to joint liability under the Securities Act in any case in which
either (i) any indemnified party makes a claim for indemnification
pursuant to this Clause 9 but it is judicially determined (by the
entry of a final judgment or decree by a court of competent
jurisdiction and the expiration of time to appeal or the denial of the
last right of appeal) that such
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indemnification may not be enforced in such case notwithstanding the
fact that this Clause 9 provides for indemnification in such case, or
(ii) contribution under the Securities Act may be required on the part
of any indemnified party in circumstances for which indemnification is
provided under this Clause 9; then, and in each such case, the
indemnified party and the indemnifying party will contribute to the
aggregate losses, Claims, damages or liabilities to which they may be
subject (after contribution from others) in such proportion so that a
Holder (together with its related Persons) is responsible for the
portion represented by the percentage that the public offering price
of its Registrable Securities offered by and sold under the
registration statement bears to the public offering price of all
securities offered by and sold under such registration statement, and
the Company and other selling Holders are responsible for the
remaining portion. The relative fault of the indemnifying party and of
the indemnified party shall be determined by a court of law by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact
relates to information supplied by the indemnifying party or by the
indemnified party and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission; provided, however, that, in any such case: (A) no Holder
will be required to contribute any amount in excess of the net
proceeds to such Holder from the sale of all such Registrable
Securities offered and sold by such Holder pursuant to such
registration statement; and (B) no Person or entity guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) will be entitled to contribution from any Person
or entity who was not guilty of such fraudulent misrepresentation.
9.5 Survival; Consents to Judgments and Settlements. The obligations of
the Company and Holders under this Clause 9 shall survive the
completion of any offering of Registrable Securities in a registration
statement, regardless of the expiration of any statutes of limitation
or extensions of such statutes. No indemnifying party, in the defense
of any such Claim or litigation, shall, except with the consent of
each indemnified party, consent to entry of any judgment or enter into
any settlement which does not include as an unconditional term thereof
the giving by the claimant or plaintiff to such indemnified party of a
release from all liability in respect to such Claim or litigation.
10. Termination of the Company's Obligations. The Company shall have no
obligations pursuant to Clauses 3, 4 and 5 with respect to any Registrable
Securities proposed to be sold by a Holder in a registration pursuant to
Clause 3, 4 or 5 after seven (7) years following the consummation of the
Qualifying IPO in the United States on either the New York Stock Exchange
or the Nasdaq National Market or, as to any Holder, such earlier time at
which all Registrable Securities held by such Holder (and any affiliate of
the Holder with whom such Holder must aggregate its sales under Rule 144)
can be sold in any ninety (90) day period without registration in
compliance with Rule 144 of the Securities Act.
11. No Registration Rights to Third Parties. Without the prior written consent
of the holders of a Majority of the Registrable Securities then
outstanding, the Company covenants and agrees that it shall not grant, or
cause or permit to be created, for the benefit of any Person or entity
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(other than the Founder) any registration rights of any kind (whether
similar to the demand, "piggyback" or Form S-3 or Form F-3 registration
rights described in this Agreement, or otherwise) relating to any
securities of the Company which are senior to, or on a parity with, those
granted to the Holders of Registrable Securities.
12. Market Stand-Off. The Founder agrees that, so long as he holds or owns any
voting securities of the Company, upon request by the Company or the
underwriters managing the initial public offering of the Company's
securities, he will not sell or otherwise transfer or dispose of any
securities of the Company (other than those permitted to be included in the
registration and other transfers to Affiliates permitted by law) without
the prior written consent of the Company or such underwriters, as the case
may be, for a period of time specified by the representative of the
underwriters not to exceed 180 days from the effective date of the
registration statement covering such initial public offering or the pricing
date of such offering as may be requested by the underwriters. The
foregoing provision of this Clause 12 shall not apply to the sale of any
securities of the Company to an underwriter pursuant to any underwriting
agreement. The Company shall require all future acquirers of the Company's
securities to execute prior to a Qualified IPO a market stand-off agreement
containing substantially similar provisions as those contained in this
Clause 12.
13. Rule 144 Reporting. With a view to making available to the Holders the
benefits of certain rules and regulations of the SEC which may at any time
permit the sale of the Registrable Securities to the public without
registration or pursuant to a registration on Form S-3 or Form F-3, after
such time as a public market exists for the Common Shares in the United
States, the Company agrees to:
13.1 Make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act, at all
times after the effective date of the first registration under the
Securities Act filed by the Company for an offering of its securities
to the general public;
13.2 File with the SEC in a timely manner all reports and other documents
required of the Company under the Securities Act and the Exchange Act
(at any time after it has become subject to such reporting
requirements); and
13.3 So long as a Holder owns any Registrable Securities, to furnish to
such Holder forthwith upon request (i) a written statement by the
Company as to its compliance with the reporting requirements of Rule
144 (at any time after ninety (90) days after the effective date of
the Company's initial public offering in the United States), the
Securities Act and the Exchange Act (at any time after it has become
subject to such reporting requirements), or its qualification as a
registrant whose securities may be resold pursuant to Form S-3 or Form
F-3 (at any time after it so qualifies), (ii) a copy of the most
recent annual or quarterly report of the Company, and (iii) such other
reports and documents of the Company as a Holder may reasonably
request in availing itself of any rule or regulation of the SEC that
permits the selling of any such securities without registration or
pursuant to Form S-3 or Form F-3.
14. Transfer of Registration Rights.
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14.1 The rights of the Holders under this Agreement (the "REGISTRATION
RIGHTS") may be assigned by a Holder, in conjunction with a Transfer
of Registrable Securities, to a Transferee that (a) is a subsidiary,
parent, partner, limited partner, member, retired member, retired,
partner, affiliate, stockholder, fund manager, or a fund managed by
the same fund manager of a Holder, (b) is a Holder's family member or
trust for the benefit of an individual Holder, (c) holds Registrable
Securities at the time of such Transfer, or (d) after such Transfer,
holds at least twenty five percent (25%) of the Registrable Securities
held by such Holder prior to any Transfers of Registrable Securities.
14.2 In the event of a Transfer of Registration Rights pursuant to Clause
14.1 (a), (b), or (c), if such Transferee receives one hundred percent
(100%) of the Registrable Securities held by the Transferring Holder,
then such Transferee may subsequently transfer the Registration Rights
in accordance with this Clause 14, otherwise such Transferee may not
subsequently transfer the Registration Rights.
14.3 In the event of a Transfer of Registration Rights pursuant to Clause
14.1(d), such Transferee may not subsequently transfer the
Registration Rights.
14.4 Nothing in this Clause 14 shall be construed as imposing any
restrictions on the transferability of the Holders' Registrable
Securities.
15. Miscellaneous.
15.1 Successors and Assigns. Except as otherwise provided herein, the terms
and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties
(including transferees of any shares of Registrable Securities).
Nothing in this Agreement, express or implied, is intended to confer
upon any party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement.
15.2 Governing Law and Jurisdiction. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York,
United States of America. The parties hereto irrevocably agree to
submit to the non-exclusive jurisdiction of the courts of the State of
New York and the United States federal courts sitting in the Borough
of Manhattan, The City of New York in all matters arising in
connection with this Agreement.
The Company undertakes to appoint an agent to receive and acknowledge
on its behalf service of any writ, summons, order, judgment or other
notice of legal process in New York, forthwith after it has commenced
procedures to apply for its securities to be registered in the United
States of America.
15.3 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
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15.4 Titles and Subtitles. The titles and subtitles used in this Agreement
are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
15.5 Notices. Any and all notices required or permitted to be given to a
party pursuant to the provisions of this Agreement will be in writing,
given in English language and will be effective and deemed to provide
such party sufficient notice under this Agreement on the earliest of
the following: (a) at the time of personal delivery, if delivery is in
person; (b) at the time of transmission by facsimile, addressed to the
other party at its facsimile number specified herein (or hereafter
modified by subsequent notice to the parties hereto), with
confirmation of receipt made by both telephone and printed
confirmation sheet verifying successful transmission of the facsimile;
(c) one (1) Business Day after deposit with an express overnight
courier for deliveries within a country, or three (3) Business Days
after such deposit for international deliveries or (d) three (3)
Business Days after deposit in mail by certified mail (return receipt
requested) or equivalent for deliveries within a country, or seven (7)
days after deposit in mail by certified mail (return receipt
requested) or equivalent for international deliveries. For the
purposes of this Clause 15.5, a delivery between the People's Republic
of China and Hong Kong shall be considered an international delivery.
All notices for international delivery will be sent by facsimile or by
express courier. All notices not delivered personally or by facsimile
will be sent with postage and/or other charges prepaid and properly
addressed to the party to be notified at the address or facsimile
number indicated for such party on the signature page hereof, or at
such other address or facsimile number as such other party may
designate by giving ten (10) days advance written notice by one of the
indicated means of notice herein to the other party hereto. Notices by
facsimile shall be machine verified as received.
Any party hereto (and such party's permitted assigns) may by notice so
given change its address for future notices hereunder. Notice shall
conclusively be deemed to have been given in the manner set forth
above.
15.6 Attorney's Fees. If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party
shall be entitled to reasonable attorneys' fees, costs and necessary
disbursements in addition to any other relief to which such party may
be entitled.
15.7 Amendments and Waivers. Any term of this Agreement may be amended and
the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the
holders of all Registrable Securities then outstanding. Any amendment
or waiver effected in accordance with this paragraph shall be binding
upon each holder of Registrable Securities then outstanding, each
future holder of all such Registrable Securities and the Company.
15
15.8 Severability. If one or more provisions of this Agreement are held to
be unenforceable under applicable law, such provision shall be
excluded from this Agreement, and the balance of the Agreement shall
be interpreted as if such provision were so excluded, and shall be
enforceable in accordance with its terms.
15.9 Aggregation of Shares. All shares of Registrable Securities of the
Company held or acquired by a shareholder and its affiliated entities
shall be aggregated together for the purpose of determining the
availability of any rights under this Agreement. For purposes of the
foregoing, the shares held by any shareholder that (i) is a
partnership or corporation shall be deemed to include shares held by
affiliated partnerships or the partners, retired partners and
shareholders of such holder or members of the "immediate family" (as
defined below) of any such partners, retired partners and
shareholders, and any custodian or trustee for the benefit of any of
the foregoing persons and (ii) is an individual shall be deemed to
include shares held by any members of the shareholder's immediate
family ("immediate family" shall include any spouse, father, mother,
brother, sister, lineal descendant of spouse or lineal descendant) or
to any custodian or trustee for the benefit of any of the foregoing
persons.
15.10 Exercise of Rights
All parties acknowledge and agree that any rights of JAFCO Asia
Technology Fund II under this Agreement may, without prejudice to the
rights of JAFCO Asia Technology Fund II to exercise any such rights,
be exercised by JAFCO Investment (Asia Pacific) Ltd. ("JIAP") or any
other fund manager of JAFCO Asia Technology Fund II or their nominees
(each, a "JAFCO MANAGER"), unless JAFCO Asia Technology Fund II has
(a) given notice to the other parties that any such rights cannot be
exercised by JIAP or a JAFCO Manager; and (b) not given notice to the
other parties that such notice given under paragraph (a) above has
been revoked.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
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CANADIAN SOLAR INC.
By: /s/
------------------------------------
Name: QU ▇▇▇▇ ▇▇▇
Title: Director
Address: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
17
INVESTORS:
HSBC HAV2 (III) LIMITED
By: /s/
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Authorised person
Address: ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ Church Street,
▇▇▇▇▇▇ Town, Grand Cayman,
Cayman Islands
18
JAFCO ASIA TECHNOLOGY FUND II
By: /s/
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
Title: Attorney
Address: ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ Church Street,
▇▇▇▇▇▇ Town, Grand Cayman,
Cayman Islands
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SCHEDULE A
THE INVESTORS
1. HSBC HAV2 (III) Limited
2. JAFCO Asia Technology Fund II
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