COALOGIX INC. AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT
EXHIBIT
10.4
COALOGIX
INC.
AMENDED
AND RESTATED
TABLE OF
CONTENTS
Page
| 1. Definitions. |
1
|
|
| 2. Registration Rights. |
3
|
|
|
2.1.
|
Participation
in Subsequent Registration Rights.
|
3
|
| 3. Information Rights |
4
|
|
|
3.1.
|
Delivery
of Financial Statements
|
4
|
|
3.2.
|
Inspection.
|
5
|
|
3.3.
|
Termination
of Information and Inspection Covenants
|
5
|
|
3.4.
|
Confidentiality
|
6
|
| 4. Right of First Offer on Company Offerings |
6
|
|
|
4.1.
|
Right
of First Offer.
|
6
|
|
4.2.
|
Management
Shareholders Rights
|
7
|
|
4.3.
|
Termination.
|
7
|
| 5. Rights of Refusal and Co-Sale |
8
|
|
|
5.1.
|
Company
Right of First Refusal
|
8
|
|
5.2.
|
Secondary
Refusal Right of Key Holders
|
8
|
|
5.3.
|
Consideration;
Closing
|
8
|
|
5.4.
|
Right
of Co-Sale.
|
9
|
|
5.5.
|
Drag-Along
Right
|
10
|
|
5.6.
|
Effect
of Failure to Comply
|
11
|
|
5.7.
|
Assistance
with Pledging of Interests
|
12
|
| 6. Exempt Transfers. |
12
|
|
|
6.1.
|
Transfers
to Affiliates, Etc
|
12
|
|
6.2.
|
Public
Offering
|
12
|
| 7. Key Holder Buy/Sell |
13
|
|
|
7.1.
|
Triggering
Notice
|
13
|
|
7.2.
|
Response
Notice
|
13
|
|
7.3.
|
Cure
Period
|
13
|
|
7.4.
|
Closing
|
14
|
| 8. Stock Option Plan |
14
|
|
| 9. Additional Covenants |
14
|
|
|
9.1.
|
Insurance.
|
14
|
-i-
|
9.2.
|
Employee
Agreements.
|
14
|
|
9.3.
|
Employee
Vesting
|
14
|
|
9.4.
|
Board
of Directors
|
15
|
|
9.5.
|
Meetings
of the Board of Directors
|
15
|
|
9.6.
|
Successor
Indemnification
|
15
|
|
9.7.
|
Transactions
with Related Parties
|
15
|
|
9.8.
|
Actions
Requiring Majority Stockholder Approval
|
15
|
|
9.9.
|
Actions
Requiring Super-Majority Stockholder Approval
|
16
|
|
9.10.
|
Termination
of Covenants.
|
17
|
|
10. Miscellaneous
|
17
|
|
|
10.1.
|
Transfers,
Successors and Assigns.
|
17
|
|
10.2.
|
Governing
Law.
|
17
|
|
10.3.
|
Counterparts.
|
17
|
|
10.4.
|
Titles
and Subtitles.
|
17
|
|
10.5.
|
Notices
|
17
|
|
10.6.
|
Amendments
and Waivers.
|
18
|
|
10.7.
|
Severability.
|
18
|
|
10.8.
|
Additional
Stockholders
|
18
|
|
10.9.
|
Entire
Agreement.
|
19
|
|
10.10.
|
Transfers
of Rights
|
19
|
|
10.11.
|
Delays
or Omissions
|
19
|
|
10.12.
|
Effectiveness
|
19
|
|
10.13.
|
Legend
on Stock Certificates
|
19
|
|
Schedule
A
|
-
Schedule of Stockholders
|
|
-ii-
AMENDED
AND RESTATED
THIS AMENDED AND RESTATED
STOCKHOLDERS’ AGREEMENT (the “Agreement”) is made as of
April 8, 2009 by and among CoaLogix Inc., a Delaware corporation (the “Company”), and each of the
stockholders listed on Schedule A hereto, each person to whom the rights of
a Stockholder are assigned pursuant to Section 10.1 and each person who
hereafter becomes a signatory to this Agreement pursuant to Section 10.8 (each,
a “Stockholder” and,
collectively, the “Stockholders”).
RECITALS
WHEREAS, the Company, EnerTech
(as defined below) and Acorn Energy (as defined below) previously entered into
that certain Stockholders’ Agreement as of February 29, 2008 (the “Original Agreement”), and such
parties desire to amend and restate the Original Agreement as set forth in this
Agreement; and
WHEREAS, EnerTech, Acorn
Energy and the individual Management Stockholders listed on Schedule A
(collectively, the “Purchasers”) and the Company
are parties to the Common Stock Purchase Agreement dated the date hereof (the
“Purchase Agreement”);
and
WHEREAS, in order to induce
the Purchasers to enter into the Purchase Agreement and to induce the Purchasers
to invest funds in the Company pursuant to the Purchase Agreement, the
Stockholders and the Company hereby agree that this Agreement shall govern the
rights of the Stockholders to receive certain information from the Company, to
participate in future equity offerings by the Company and certain other matters
as set forth in this Agreement;
NOW, THEREFORE, for
and in consideration of the mutual promises of the parties hereto and other good
and valuable consideration, the receipt of sufficiency of which are hereby
acknowledged, the parties hereto do hereby agree to amend and restate the
Original Agreement in its entirety, and the Original Agreement is hereby amended
and restated in its entirety as follows.
1. Definitions. For purposes of
this Agreement:
“Acorn Energy” shall mean Acorn
Energy, Inc and it Affiliates.
“Affiliate” shall mean with
respect to any individual, corporation, partnership, association, trust, or any
other entity (in each case, a “Person”), any Person which,
directly or indirectly, controls, is controlled by or is under common control
with such Person, including, without limitation any general partner, officer or
director of such Person and any venture capital fund now or hereafter existing
which is
controlled by or under common control with one or more general partners or
shares the same management company with such Person.
-1-
“Common Stock” shall mean
shares of the Company’s common stock, $0.001 par value per share.
“Company Notice” means written
notice from the Company notifying a selling Stockholder that the Company intends
to exercise its Right of First Refusal as to some or all of the Transfer Stock
with respect to any Proposed Transfer.
“EnerTech” shall mean EnerTech
Capital Partners III L.P. and its Affiliates.
“Exchange Act” shall mean the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
“GAAP” shall mean U.S.
generally accepted accounting principles.
“IPO” means the Company’s first underwritten public offering
of its Common Stock under the Securities Act.
“Key Holders” means Acorn Energy and EnerTech, so long as they are
Stockholders owning at least five percent (5.0%) of the issued and outstanding
capital stock of the Company. If either Acorn Energy or EnerTech no longer owns
at least five percent of the issued and outstanding capital stock of the
Company, but still owns some capital stock of the Company, such former Key
Holder shall still be a Stockholder.
“Key Holder Secondary Notice”
means written notice from a Key Holder notifying the Company and the selling Key
Holder or Stockholder, as the case may be, that such Key Holder intends to
exercise its Secondary Refusal Right as to a portion of the Transfer Stock with
respect to any Proposed Transfer.
“Key Holder Stock” means any
Common Stock now owned or subsequently acquired by any Key Holder or such Key
Holder’s permitted transferees or assigns.
“Management Stockholder” means
a Stockholder currently employed in the management of the Company, for so long
as such Stockholder is employed in such a capacity.
“New Securities” shall mean
equity securities of the Company, whether now authorized or not, or rights,
options, or warrants to purchase said equity securities, or securities of any
type whatsoever that are, or may become, convertible into or exchangeable into
or exercisable for said equity securities (collectively “New Securities”).
“Proposed Transfer” means any
proposed assignment, sale, offer to sell, pledge, mortgage, hypothecation,
encumbrance, disposition of or any other like transfer or encumbering
of any Common Stock (or any interest therein) proposed by any of the
Stockholders; provided that
Proposed Transfer shall not include any merger, consolidation or like transfer
effected pursuant to a vote of the Stockholders of Common Stock of the
Company.
-2-
“Proposed Transfer Notice”
means written notice from a Stockholder setting forth the terms and conditions
of a Proposed Transfer.
“Prospective Transferee” means
any Person to whom a Stockholder proposes to make a Proposed
Transfer.
“Registrable Securities” means
(i) the Common Stock owned by either Key Holder, and (ii) any Common Stock of
the Company issued as (or issuable upon the conversion or exercise of any
warrant, right or other security which is issued as) a dividend or other
distribution with respect to, or in exchange for or in replacement of the shares
referenced in clause (i), excluding in all
cases, however, any Registrable Securities sold by a Person in a transaction in
which such Person’s rights under Section 2 hereof
are not assigned or any shares for which registration rights have
terminated.
“Right of Co-Sale” means the
right, but not an obligation, of a Key Holder or Management Stockholder to
participate in a Proposed Transfer on the terms and conditions specified in the
Proposed Transfer Notice.
“Right of First Refusal” means
the right, but not an obligation, of a Key Holder or the Company, as the case
may be, or his, her or its permitted transferees or assigns, to purchase some or
all of the Transfer Stock with respect to a Proposed Transfer, on the terms and
conditions specified in the Proposed Transfer Notice.
“Securities Act” means the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
“Secondary Notice” means
written notice from the Company notifying the selling Key Holder and the other
Key Holder that the Company does not intend to exercise its Right of First
Refusal as to all shares of Transfer Stock with respect to any Proposed
Transfer.
“Secondary Refusal Right” means
the right, but not an obligation, of each Key Holder to purchase up to its pro
rata portion (based upon the total number of shares of Common Stock then held by
all Key Holders) of Transfer Stock not purchased pursuant to the Company’ s
Right of First Refusal, on the terms and conditions specified in the Proposed
Transfer Notice.
“Transfer Stock” means shares
of Common Stock subject to a Proposed Transfer.
2. Registration
Rights. The
Company covenants and agrees as follows:
2.1. Participation in Subsequent
Registration Rights. So
long as either Key Holder remains a Key Holder, from and after the date of this
Agreement, the Company shall not, without the prior written consent of each Key
Holder, enter into any agreement with any stockholder or prospective stockholder
of any securities of the Company which would grant such stockholder or
prospective stockholder registration rights in respect of Registrable
Securities, unless the Company shall thereunder grant each Key Holder
registration rights identical to the most favorable registration rights provided
to any other stockholder or prospective stockholder of any securities of the
Company.
-3-
3. Information
Rights.
3.1. Delivery of Financial
Statements. So long as EnerTech owns one percent (1.0%) of the issued
and outstanding capital stock of the Company, the Company shall deliver
to EnerTech or its Affiliate, as the case may be:
(a) as
soon as practicable, but in any event within ninety (90) days after the end of
each fiscal year of the Company, a balance sheet and income statement as of the
last day of such year; a statement of cash flows for such year and a comparison
between the actual figures for such year, the comparable figures for the prior
year and the comparable figures included in the Budget (as defined below) for
such year, with an explanation of any material differences between them and a
schedule as to the sources and applications of funds for such year, such
year-end financial reports to be in reasonable detail, prepared in accordance
with GAAP, of the Company;
(b) as
soon as practicable, but in any event within forty-five (45) days after the end
of each of the first three (3) quarters of each fiscal year of the Company, an
unaudited income statement, schedule as to the sources and application of funds
for such fiscal quarter, an unaudited balance sheet and a statement of
stockholder’s equity as of the end of such fiscal quarter;
(c) as
soon as practicable, but in any event with forty-five (45) days after the end of
each of the first three (3) quarters of each fiscal year of the Company, a
statement showing the number of shares of each class and series of capital stock
and securities convertible into or exercisable for shares of capital stock
outstanding at the end of the period, the number of common shares issuable upon
conversion or exercise of any outstanding securities convertible or exercisable
for common shares and the exchange ratio or exercise price applicable thereto
and number of shares of issued stock options and stock options not yet
issued but reserved for issuance, if any, all in sufficient detail as to permit
EnerTech or its Affiliate to calculate its percentage equity ownership in the
Company and certified by the Chief Financial Officer or Chief Executive Officer
of the Company as being true, complete and correct;
(d) as
soon as practicable, but in any event within thirty (30) days of the end of each
month, an unaudited income statement, an unaudited profit or loss
statement;
(e) as
soon as practicable, but in any event thirty (30) days prior to the end of each
fiscal year, a budget and business plan for the next fiscal year (collectively,
the “Budget”), prepared
on a monthly basis, including balance sheets and sources and applications of
funds statements for such months and, as soon as prepared, any other budgets or
revised budgets prepared by the Company;
-4-
(f) with
respect to the financial statements called for in subsections (a)
and(b) of this Section 3.1, an
instrument executed by the Chief Financial Officer and President or Chief
Executive Officer of the Company and certifying that such financials were
prepared in accordance with GAAP consistently applied with prior practice for
earlier periods (with the exception of footnotes that may be required by GAAP)
and fairly present the financial condition of the Company and its results of
operation for the periods specified therein, subject to year-end audit
adjustment;
(g) such
other information relating to the financial condition, business, prospects or
corporate affairs of the Company as EnerTech or any assignee of EnerTech may
from time to time reasonably request, provided, however,
that the Company shall not be obligated under this subsection (g)
or any other subsection of Section 3.1 to
(i) provide information which the Company reasonably deems in good faith to be a
trade secret or similar confidential information (unless covered by an
enforceable confidentiality agreement, in form acceptable to the Company) or
(ii) would adversely affect the attorney-client privilege between the Company
and its counsel;
(h) if
for any period the Company shall have any subsidiary whose accounts are
consolidated with those of the Company, then in respect of such period the
financial statements delivered pursuant to the foregoing sections shall be the
consolidated and consolidating financial statements of the Company and all such
consolidated subsidiaries.
(i) notices describing in reasonable
detail any claim, action, suit, proceeding, arbitration, complaint, charge or
investigation pending or to the knowledge of the Company threatened against the
Company or any officer or director of the Company involving the Company or any
default or breach by any party under any agreement of the Company as soon as
practicable, but in any event within five (5) days after the Company becomes
aware of such litigation or contract default.
3.2. Inspection. So long as EnerTech owns one
percent (1.0%) of the issued and outstanding capital stock of the
Company, the Company shall permit, at EnerTech’s expense, EnerTech to
visit and inspect the Company’s properties, to examine its books of account and
records and to discuss the Company’s affairs, finances and accounts with its
officers, all at such reasonable times as may be reasonably requested by at
EnerTech; provided,
however, that the Company shall not be obligated pursuant to this Section 3.2 to
provide access to any information which it reasonably considers to be a trade
secret or similar confidential information (unless covered by an enforceable
confidentiality agreement in a form acceptable to the Company) or would
adversely affect the attorney-client privilege between the Company and its
counsel.
3.3. Termination of Information
and Inspection Covenants. The covenants set forth in Section 3.1 and Section 3.2
shall terminate as to EnerTech and be of no further force or effect immediately
prior to the consummation of the sale of shares of Common Stock in the Company’s
IPO or when the Company first becomes subject to the periodic reporting
requirements of Sections 12(g) or 15(d) of the Exchange Act, unless EnerTech
ceases to own one percent (1.0%) of the
issued and outstanding capital stock of the Company prior to the
occurrence of such events, in which case the covenants shall terminate as of the
date that EnerTech no longer owns one percent (1.0%) of the
issued and outstanding capital stock of the Company.
-5-
3.4. Confidentiality. Each Stockholder agrees
that such Stockholder will keep confidential and will not disclose, divulge or
use for any purpose, other than to monitor its investment in the Company, any
confidential information obtained from the Company pursuant to the terms of this
Agreement, unless such confidential information (i) is known or becomes known to
the public in general (other than as a result of a breach of this Section 3.4 by such
Stockholder), (ii) is or has been independently developed or conceived by the
Stockholder without use of the Company's confidential information or (iii) is or
has been made known or disclosed to the Stockholder by a third party without a
breach of any obligation of confidentiality such third party may have to the
Company; provided,
however, that a Stockholder may disclose confidential information
(a) to its attorneys, accountants, consultants, and other professionals to
the extent necessary to obtain their services in connection with monitoring its
investment in the Company, (b) to any prospective purchaser of any
Registrable Securities from such Stockholder as long as such prospective
investor agrees to be bound by the provisions of this Section 3.4,
(c) to any Affiliate, partner, member, stockholder or wholly owned
subsidiary of such Stockholder in the ordinary course of business, as long as
such Affiliate, partner, member stockholder or wholly owned subsidiary of such
Stockholder agrees to be bound by the provisions of this Section 3.4, or (d)
as may otherwise be required by law, provided that the Stockholder takes
reasonable steps to minimize the extent of any such required
disclosure. The Company, EnerTech, and the Stockholders hereby
acknowledge that EnerTech invests in numerous companies, some of which may be
competitive with the Company’s business. The Company, EnerTech and
the Stockholders agree that EnerTech shall not be liable for any claim arising
out of, or based upon, (i) the investment by EnerTech in any entity competitive
to the Company, (ii) actions taken by any partner, officer or other
representative of EnerTech to assist any such competitive company, whether or
not such action was taken as a board member of such competitive company, or
otherwise, and whether or not such action has a detrimental effect on the
Company, unless such claim arises directly from the EnerTech’s misuse of
confidential information in material breach of this Section
3.4.
4. Right
of First Offer on Company Offerings
4.1. Right of First
Offer. Subject
to the terms and conditions specified in this Section 4.1, and
applicable securities laws, in the event the Company proposes to offer or sell
any New Securities other than the Common Stock to be issued under the Purchase
Agreement, the Company shall first make an offering of such New Securities to
EnerTech and Acorn (collectively, the “Offerees”, and individually,
an “Offeree”) in
accordance with the following provisions of this Section
4.1. An Offeree
shall be entitled to apportion the right of first offer hereby granted it among
itself and its partners, members and Affiliates in such proportions as they each
deem appropriate.
(a) The
Company shall deliver a notice, in accordance with the provisions of Section 10.5
hereof, (the “Offer
Notice”) to the Offerees stating (i) its bona fide intention to
offer such New Securities, (ii) the number of such New Securities to be
offered, and (iii) the price and terms, if any, upon which it proposes to
offer such New Securities.
-6-
(b) By
written notification received by the Company, within twenty (20) calendar days
after mailing of the Offer Notice, an Offeree may elect to purchase or obtain,
at the price and on the terms specified in the Offer Notice, up to that portion
of such New Securities which equals the proportion that the number of shares of
Common Stock issued and then held by such Offeree bears to the total number of
shares of Common Stock of the Company issued and then held by all the
Stockholders.
(c) In
the event that the Company proposes to offer New Securities contingently, each
Offeree will be issued warrants (“Contingent Warrants”) to
purchase its pro rata portion of equity securities which may be purchased
pursuant to such New Securities, or into which such New Securities may become
convertible, as the case may be, in lieu of receiving such New Securities on the
same terms as stated in the Offer Notice. The exercise of such Contingent
Warrants will be subject to the same contingencies as the New Securities
proposed to be offered. An Offeree must exercise such Contingent Warrants within
twenty (20) calendar days after the Company has properly delivered a notice to
the Offeree, in accordance with Section 10.5 hereof,
that such Contingent Warrants may be exercised.
(d) If
the consideration proposed to be paid for New Securities is in property,
services or other non-cash consideration, the value of the consideration shall
be as agreed in good faith by the Offeree and the Company. If the Offeree and
the Company fail to agree in good faith as to the value of such consideration,
the price paid for such offered New Securities shall be deemed to be the value
of such consideration as calculated in accordance with GAAP.
(e) The
right of first offer in this Section 4.1 shall not
be applicable to: (i) the shares of Common Stock properly issued or deemed
issued to employees or directors of, or consultants to, the Company or any of
its subsidiaries pursuant to the Stock Option Plan (as defined in Section 8); or (ii)
securities issued in connection with any stock split or stock dividend of the
Company.
(f) The
right of first offer set forth in this Section 4.1 may
not be assigned or transferred except that such right is assignable by an
Offeree to any of its Affiliates.
4.2. Termination. The
provisions of this Section 4 shall
terminate upon the first to occur of (i) the consummation of an IPO or (ii) a
failure by an Offeree to elect to purchase a portion of New Securities to which
it is entitled under Section 4.1(b), or to
exercise its Contingent Warrants, if any, as provided under Section 4.1(c); provided,
however, in the case of the
immediately preceding clause (ii) this Section 4 shall
terminate only as to the Offeree who has failed to so elect or
exercise.
4.3. Management Stockholders’
Rights. The parties hereto acknowledge that certain Management
Stockholders have a right of first offer to purchase New Securities of the
Company under the terms of their individual option agreements entered into in
connection with the Stock Option Plan, and the Company shall coordinate the
administration of the right of first offer described in Section 4.1 with the right of
first offer held by such Management Stockholders.
-7-
5. Rights
of Refusal and Co-Sale
5.1. Company Right of First
Refusal. Each Stockholder hereby unconditionally and
irrevocably grants to the Company a Right of First Refusal to purchase all or
any portion of Transfer Stock that such Stockholder may propose to transfer in a
Proposed Transfer, at the same price and on the same terms and conditions as
those offered to the Prospective Transferee. Each Stockholder proposing to make
a Proposed Transfer must deliver a Proposed Transfer Notice to the Company and
the Key Holders, not later than 10 days prior to the consummation of such
Proposed Transfer. Such Proposed Transfer Notice shall contain the
material terms and conditions of the Proposed Transfer and the identity of the
Prospective Transferee. The Company must exercise its Right of First
Refusal under this Section 5.1 by giving
a Company Notice to such selling holder of Common Stock within fifteen (15) days
after delivery of the Proposed Transfer Notice.
5.2. Secondary Refusal Right of
Key Holders.
(a) Each
Key Holder hereby unconditionally and irrevocably grants to the other Key Holder
a Secondary Refusal Right to purchase the shares of Key Holder Stock not
purchased by the Company pursuant to the Company’s Right of First Refusal under
Section 5.1, as
provided in this Section
5.2. If the Company does not intend to exercise its Right of
Refusal under Section
5.1 with respect to all Key Holder Stock subject to a Proposed Transfer,
the Company must deliver a Secondary Notice to the other Key Holder to that
effect no later than fifteen (15) days after the selling Key Holder delivers the
Proposed Transfer Notice to the Company. To exercise its Secondary
Refusal Right, a Key Holder must deliver a Key Holder Secondary Notice to the
selling Key Holder and the Company within ten (10) days after the deadline for
delivery of the Secondary Notice.
(b) Each
Stockholder that is not a Key Holder hereby unconditionally and irrevocably
grants to the Key Holders a Secondary Refusal Right to purchase up to each Key
Holder’s pro rata portion (based upon the total number of shares of each Key
Holder’s Stock) of the Stockholder’s stock not purchased by the Company pursuant
to the Company’s Right of First Refusal under Section 5.1, as
provided in this Section
5.2. If the Company does not intend to exercise its Right of
Refusal under Section
5.1 with respect to all of the selling Stockholder’s Common Stock subject
to a Proposed Transfer, the Company must deliver a Secondary Notice to the Key
Holders to that effect no later than fifteen (15) days after the selling
Stockholder delivers the Proposed Transfer Notice to the Company. To
exercise its Secondary
Refusal Right, a Key Holder must deliver a Key Holder Secondary Notice to the
selling Stockholder and the Company within ten (10) days after the deadline for
delivery of the Secondary Notice.
5.3. Consideration;
Closing. If the consideration proposed to be paid for the
Transfer Stock is in property, services or other non-cash consideration, the
fair market value of the consideration shall be determined in good faith by the
Company’s Board of Directors. If the Company or any Key Holder cannot
for any reason pay for the Transfer Stock in the same form of non-cash
consideration, the Company or such Key Holder may pay the cash value equivalent
thereof, as determined by the Board of Directors. The closing of the
purchase of Transfer Stock by the Company and/or the other Key Holder, as the
case may be, shall take place, and all payments from the Company and/or the
other Key Holder, as the case may be, shall have been delivered to the selling
Stockholder by the later of (i) the date specified in the Proposed Transfer
Notice as the intended date of the Proposed Transfer and (ii) forty-five (45)
days after delivery of the Proposed Transfer Notice.
-8-
5.4. Right of
Co-Sale.
(a) If
any Transfer Stock subject to a Proposed Transfer by a Stockholder is not
purchased pursuant to Sections 5.1 and
5.2 above and
thereafter is to be sold to a Prospective Transferee, a Key Holder or Management
Stockholder may elect to exercise its Right of Co-Sale and participate on a
pro-rata basis in the Proposed Transfer on the same terms and conditions
specified in the Proposed Transfer Notice. A Key Holder or Management
Stockholder who desires to exercise its Right of Co-Sale must give the selling
Stockholder written notice to that effect within fifteen (15) days after the
deadline for delivery of the Key Holder Secondary Notice as described above, and
upon giving such notice such Key Holder or Management Stockholder shall be
deemed to have effectively exercised the Right of Co-Sale.
(b) Each
Key Holder or Management Stockholder who timely exercises its Right of Co-Sale
by delivering the written notice provided for above in Section 5.4(a) may
include in the Proposed Transfer all or any part of his, her or its Common Stock
equal to the product obtained by multiplying (i) the aggregate number of shares
of Stockholder Common Stock subject to the Proposed Transfer (excluding shares
purchased by the Company pursuant to the Right of First Refusal of the Company)
by (ii) a fraction, the numerator of which is the number of shares of Common
Stock owned by such Key Holder or Management Stockholder immediately before
consummation of the Proposed Transfer and the denominator of which is
the total number of shares of Common Stock owned, in the aggregate, by all
Stockholders immediately prior to the consummation of the Proposed
Transfer. To the extent a Key Holder or Management Stockholder
exercises such right of participation in accordance with the terms and
conditions set forth herein, the number of shares of Common Stock that the
selling Stockholder may sell in the Proposed Transfer shall be correspondingly
reduced.
(c) Each
participating Key Holder or Management Stockholder shall effect its
participation in the Proposed Transfer by delivering to the transferring
Stockholder, no later than fifteen (15) days after such Key Holder’s or
Management Stockholder’s exercise of the Right of Co-Sale, one or more stock
certificates, properly endorsed for
transfer to the Prospective Transferee, representing the number of shares of
Common Stock that such Key Holder or Management Stockholder elects to include in
the Proposed Transfer.
(d) The
terms and conditions of any sale pursuant to this Section 5.4 will be
memorialized in, and governed by, a written purchase and sale agreement with
customary terms and provisions for such a transaction.
(e) Each
stock certificate a participating Key Holder or Management Stockholder delivers
to the selling Stockholder pursuant to subparagraph (c) above will be
transferred to the Prospective Transferee against payment therefor in
consummation of the sale of the Transfer Stock pursuant to the terms and
conditions specified in the Proposed Transfer Notice and the purchase and sale
agreement, and the selling Stockholder shall concurrently therewith remit to the
appropriate Key Holder or Management Stockholder the portion of the sale
proceeds to which such Key Holder or Management Stockholder is entitled by
reason of its participation in such sale. If any Prospective
Transferee or Transferees refuse(s) to purchase securities subject to the Right
of Co-Sale from a Key Holder or Management Stockholder exercising its Right of
Co-Sale hereunder, no Stockholder may sell any Common Stock to such Prospective
Transferee or Transferee unless and until, simultaneously with such sale, such
selling Stockholder purchases all securities subject to the Right of Co-Sale
from such other Stockholders.
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(f) If
any Proposed Transfer is not consummated within forty-five (45) days after
receipt of the Proposed Transfer Notice by the Key Holders, the Management
Stockholders, or the Company, as the case may be, the Stockholder proposing the
Proposed Transfer may not sell any of its Common Stock unless it first complies
in full with each provision of this Section
5. The exercise or election not to exercise any right by any
Key Holder or Management Stockholder hereunder shall not adversely affect its
right to participate in any other sales of Transfer Stock subject to this Section
5.4.
5.5. Drag-Along
Right.
(a) In
the event that any Key Holder owns more than fifty percent (50%) of the
Company’s issued and outstanding capital stock and such Key Holder desires to
accept a bona fide offer (a "Purchase Offer") from any
person or persons, other than an Affiliate or another Stockholder, to purchase
all (a "Divestiture")
the shares of Common Stock then held by such Key Holder, then such Key Holder
shall promptly deliver to each of the other Stockholders a written notice (the
"Purchase Offer Notice")
stating such Key Holder’s intention to sell such shares pursuant to such
Purchase Offer and setting forth the terms and conditions of such Purchase
Offer, including, without limitation, the identity of the proposed purchaser and
the amount and type of consideration to be paid therefor. The
Purchase Offer Notice shall include a copy of any written offer, letter of
intent, term sheet or contract of sale pertaining to the Purchase
Offer.
(b)
In connection with a Divestiture, any Key Holder owning more than fifty percent
(50%) of the Company’s issued and outstanding capital stock shall have the right
("Drag Along Right") to
require each other Stockholder to participate in such sale of Common
Stock by such Key Holder on the terms and conditions set forth in the Purchase
Offer Notice (which shall be the same terms and conditions (on a per share
basis) as are applicable to such Key Holder’s sale of shares of Common Stock to
the proposed purchaser). Such Drag Along Right shall be exercisable
by such Key Holder including in its Purchase Offer Notice a statement to the
effect that such Key Holder elects to exercise its Drag Along Right in
connection with the proposed sale. At any time prior to the closing
of such sale, such Key Holder may withdraw its election to exercise its Drag
Along Right upon written notice to the Stockholders.
(c) The
closing of the purchase and sale of any shares of Common Stock to be sold
pursuant to the Drag Along Right shall occur concurrently with the closing of
the sale of the shares of the Common Stock by the Key Holder owning more than
fifty percent (50%) of the Company’s issued and outstanding capital stock, which
shall be a date not less than sixty (60) days after the giving of the Purchase
Offer Notice. At any such closing, each Stockholder shall
deliver to the purchaser a certificate or certificates representing the number
of shares of Common Stock to be sold by such Stockholder, duly endorsed in blank
or accompanied by a duly executed stock power in blank, with signatures duly
guaranteed and all requisite stock transfer stamps affixed
thereto. All Stockholders shall be treated equally under this Section
5.5. It shall be a condition of the obligation to sell under
this Section
5.5 that all facts and circumstances and all material aspects of any
transaction under this Section 5.5 shall be
disclosed. The provisions of this Section 5.5 shall
terminate upon an IPO.
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5.6. Effect of Failure to
Comply.
(a) Any
Proposed Transfer not made in compliance with the requirements of this Agreement
shall be null and void ab initio, shall not be recorded on the books of the
Company or its transfer agent and shall not be recognized by the
Company. Each party hereto acknowledges and agrees that any breach of
this Agreement would result in substantial harm to the other parties hereto for
which monetary damages alone could not adequately
compensate. Therefore, the parties hereto unconditionally and
irrevocably agree that any non-breaching party hereto shall be entitled to seek
protective orders, injunctive relief and other remedies available at law or in
equity (including, without limitation, seeking specific performance or the
rescission of purchases, sales and other transfers of Common Stock not made in
strict compliance with this Agreement).
(b) If
any Stockholder becomes obligated to sell any Common Stock to the Company under
this Agreement and fails to deliver such Common Stock in accordance with the
terms of this Agreement, the Company may, at its option, in addition to all
other remedies it may have, send to such Stockholder the purchase price for such
Common Stock as is herein specified and cancel on its books the certificate or
certificates representing the Common Stock to be sold.
(c) If
any Stockholder purports to sell any Common Stock in contravention of the terms
of this Agreement (a “Prohibited Transfer”), the
Company or a Key Holder, as the case may be, in addition to such remedies as may
be available by law, in equity or hereunder,
is entitled to require the following actions of such Stockholder, and such
Stockholder will be bound by the terms of such option:
(i) If
a Stockholder makes a Prohibited Transfer, a Key Holder or the Company, as the
case may be, who timely exercises his, her or its Right of First Refusal under
Sections 5.1
and 5.2 may
require such Stockholder, to sell to the other Key Holder or the Company, as the
case may be, the number of shares of Common Stock that such other Key Holder or
the Company, as the case may be, would have been entitled to purchase under
Sections 5.1
and 5.2 had the
Prohibited Transfer been effected pursuant to and in compliance with the terms
of Sections 5.1
and 5.2.
(ii) If
a Key Holder makes a Prohibited Transfer, the other Key Holder that timely
exercises its Right of Co-Sale under Section 5.4 may
require such Key Holder to purchase from it the number of shares of Common Stock
that such Key Holder would have been entitled to sell to the Prospective
Transferee under Section 5.4 had the
Prohibited Transfer been effected pursuant to and in compliance with the terms
of Section
5.4.
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In each
case, the sale will be made on the same terms and subject to the same conditions
as would have applied had the Stockholder not made the Prohibited Transfer,
except that the sale (including, without limitation, the delivery of the shares
or the purchase price, as the case may be) must be made within ninety (90) days
after the Company or the other Key Holder, as the case may be, learns of the
Prohibited Transfer, as opposed to the timeframe proscribed in Sections 5.1, 5.2, 5.3, 5.4, or 5.5 as the case may
be. Such Stockholder shall also reimburse the other Key Holder and
the Company, as the case may be, for any and all fees and expenses, including
legal fees and expenses, incurred pursuant to the exercise or the attempted
exercise of the Key Holder’s or the Company’s, as the case may be, rights under
Sections 5.1,
5.2, 5.3, 5.4, or 5.5 as the case may
be.
5.7. Assistance with Pledging of
Interests. The rights of the Company and the Key Holders under
this Section 5
shall not pertain or apply to any pledge by a Key Holder of its Common Stock
which creates a mere security interest in such Common Stock. The Company shall
consent to any pledging of any Key Holder’s Common Stock and other matters
customarily requested of the Key Holders by the Key Holders’ lenders; provided that any
pledge of Common Stock shall be contingent upon the pledgee providing a written
instrument to the Company agreeing in writing that its lien is subject to the
terms of this Agreement.
6. Exempt
Transfers.
6.1. Transfers to Affiliates,
Etc. Notwithstanding the foregoing or anything to the contrary
herein, the provisions of Sections 5.1, 5.2 and 5.4 shall not apply:
(i) in the case of a Key Holder that is an entity, upon a transfer by such Key
Holder to its stockholders, members, partners or other equity holders, (ii) to a
repurchase of Common Stock from a Key Holder by the Company at a price no
greater than that originally paid by such Key Holder for such Common Stock and
pursuant to an agreement containing vesting and/or repurchase provisions
approved by a majority of the Board of Directors, or (iii) to the sale or
transfer of Common Stock between Key Holders and their respective Affiliates;
provided, however, that such
transfer shall be contingent upon the transferee providing a written instrument
to the
Company notifying the Company of such transfer and assignment and agreeing in
writing to be bound by the terms of this Agreement; and provided further,
notwithstanding any such permitted transfer, such transferred Common Stock shall
remain Common Stock and Key Holder Stock for all purposes hereunder, and such
transferee shall be treated as a Key Holder, as the case may be, (but only with
respect to the securities so transferred to the transferee) for all purposes of
this Agreement (including the obligations of a Key Holder with respect to
Proposed Transfers of such Capital Stock pursuant to Section 5); and provided, further, in the case
of any transfer pursuant to clause (i), that such transfer is made pursuant to a
transaction in which there is no consideration actually paid for such
transfer.
6.2. Public
Offering. Notwithstanding the foregoing or anything to the
contrary herein, the provisions of Section 5 shall not
apply to the sale of any Common Stock to the public in an IPO, and the
provisions of Section
5 shall terminate and be of no further force or effect upon (a) the
consummation of the IPO, or (b) the Company first becoming subject to the
periodic reporting requirements of Sections 12(g) or 15(d) of the Exchange Act,
whichever event shall first occur.
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7. Key Holder
Buy/Sell.
7.1. Triggering
Notice. Either Key Holder (such Key Holder, the “Triggering Key Holder”) may
deliver a written notice in accordance with the provisions of Section 10.5
hereof, (a “Triggering Notice”) to the
other Key Holder (the “Responding Key Holder”) and in
such event will also deliver a copy of the Triggering Notice to the Management
Stockholders in accordance with the provisions of Section 10.5 hereof stating:
(i) its intent to commence a purchase or sale of Key Holder Stock under this
Section 7 and
(ii) the per-share price (the “Per-Share Buy/Sell Price”)
which will be applicable to such transaction.
7.2. Response Notice and Election
Notice. Within 90 days of the delivery of a Triggering Notice,
the Responding Key Holder shall deliver a written notice in accordance with the
provisions of Section 10.5 (the “Response Notice”) to the
Triggering Key Holder stating whether the Responding Key Holder has elected: (i)
to purchase the entirety of the Triggering Key Holder’s Common Stock
at the Per-Share Buy/Sell Price or (ii) to sell the entirety of its Common Stock
to the Triggering Key Holder at the Per-Share Buy/Sell Price. Within
90 days of the delivery of a Triggering Notice, Management Stockholders shall
have the right to deliver written notices in accordance with the provisions of
Section 10.5 (the “Election
Notice”) to the Triggering Key Holder and Responding Key Holder stating
the Management Stockholders’ intent to exercise its right to tag along and sell
the Management Stockholders’ Common Stock in accordance with the terms of this
Section 7. Management Stockholders who elect to exercise their right
to tag along and sell their shares of Common Stock after delivering such
Election Notice shall sell their shares of Common Stock to whichever one of the
Triggering Key Holder and Responding Key Holder is the purchaser of the Common
Stock as described in Section 7.3 in
accordance with the terms and purchase price set forth in the Triggering
Notice. The Management Stockholders’ tag along rights set forth in
this Section
7.2 shall not be applicable to (i) the shares of Common Stock properly
issued or deemed issued to employees or directors of, or consultants to, the
Company or any of its subsidiaries pursuant to the Stock Option Plan (as defined
in Section 8);
or (ii) securities issued in connection with any stock split or stock
dividend of the Company relating to the shares of Common Stock described in
clause (i) of this Section 7.2.
7.3. Cure
Period. If no Response Notice is delivered within 90 days of a
Triggering Notice, the Triggering Key Holder shall deliver a written notice in
accordance with the provisions of Section 10.5 (the “Cure Period Notice”) to the
Responding Key Holder stating that the Responding Key Holder has failed to
deliver a Response Notice and stating that the Responding Key Holder (with a
copy to the Management Stockholders) has 15 days from delivery of the Cure
Period Notice (the “Cure
Period”) to deliver a Response Notice to the Triggering Key Holder. If
the Responding Key Holder does not deliver a Response Notice within the Cure
Period, the Triggering Key Holder shall, at its sole option, within ten days of
the conclusion of the Cure Period elect: (i) to purchase
the entirety of the Responding Key Holder’s Common Stock at the Per-Share
Buy/Sell Price or (ii) to sell the entirety of its Common Stock to the
Responding Key Holder at the Per-Share Buy/Sell Price. The Management
Stockholders who earlier delivered an Election Notice shall sell their shares of
Common Stock to the purchaser as determined by the immediately preceding
sentence. The Key Holders and the Management Stockholders who earlier
delivered an Election Notice shall thereupon effect a Closing of a sale or
purchase in accordance with the provisions of Section 7.4 pursuant to the terms
of the preceding sentence.
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7.4. Closing. The
closing of a sale or purchase under this Section 7 shall take
place, and stock certificates representing all of the shares of Common Stock of
the Selling Key Holder and Management Shareholders who delivered an Election
Notice, properly endorsed for transfer to the purchasing Key Holder, as well as
all payments from the purchasing Key Holder shall have been delivered to the
selling Key Holder and Management Shareholders who delivered an Election Notice
within forty-five (45) days after delivery of the Response Notice, the Cure
Period Notice or the expiration of the Cure Period, as the case may
be.
8. Stock Option
Plan. Notwithstanding the foregoing or anything to the
contrary herein, the provisions of Sections 4 and 5 shall not apply to
the issuance of options under the Company’s 2008 Stock Option Plan a management
option plan (the “Stock Option
Plan”), provided that: (i) the total Company equity available for
issuance under the Stock Option Plan will not exceed 12.5% ownership of the
Company, on a fully diluted basis following Closing (as defined in the Purchase
Agreement); (ii) the exercise price per share for any options issued under the
Stock Option Plan on or after the date hereof will be equal to or greater than
the price per share paid by EnerTech under the Purchase Agreement; and (iii) the
option pool under the Stock Option Plan shall not be increased without
EnerTech’s written consent.
9. Additional
Covenants.
9.1. Insurance. Acorn
Energy maintains Directors and Officers Errors and Omissions insurance
pursuant to a policy of insurance substantially in the form provided to
EnerTech. The Company and Acorn Energy will use reasonable best efforts to cause
such insurance policy to be maintained until such time as the Board of Directors
of the Company determines that such insurance
should be discontinued. The policy shall not be cancelable by Acorn Energy
without prior approval of the Board of Directors.
9.2. Employee
Agreements. The
Company will cause each person now or hereafter employed by it or any subsidiary
(or engaged by the Company or any subsidiary as a consultant/independent
contractor) with access to confidential information and/or trade secrets to
enter into a proprietary information, inventions, non-competition and
non-solicitation agreement substantially in the form approved by the Board of
Directors and satisfactory to the Stockholders.
9.3. Employee
Vesting. All future employees and consultants of the Company
who shall purchase, or receive options to purchase, shares of the Company’s
capital stock following the date hereof shall be required to execute stock
purchase or option agreements providing for vesting of shares over a four-year
period with the first 25% of such shares vesting following 12 months of
continued employment or services after the grant date of each such security, and
the remaining shares vesting in equal quarterly installments over the following
36 months. The issuance or transfer of any options to purchase shares of the
Company’s capital stock shall be contingent upon the holder or transferee
becoming a party to this Agreement by executing and delivering an additional
counterpart signature page to this Agreement, and thereafter such holder or
transferee shall be deemed a “Stockholder” for all purposes
hereunder.
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9.4. Board of
Directors. Each Stockholder agrees to vote all of his, her or
its shares of voting securities in the Company, whether now owned or hereafter
acquired or which such Stockholder may be empowered to vote, from time to time
and at all times, in whatever manner shall be necessary to ensure that at each
annual or special meeting of stockholders at which an election of directors is
held or pursuant to any written consent of the stockholders, the following
persons shall be elected to the Board: five to seven individuals designated in
the following proportions: (i) one designee of EnerTech, for so long as EnerTech
remains a Key Holder , (ii) two designees of Acorn Energy, (iii) one to three
outside directors designated by the Stockholders voting together as a single
class, and (iv) the chief executive officer of the Company.
9.5. Meetings of the Board of
Directors. The Board shall meet no less frequently than once
every quarter, with monthly telephone conversations on an as-needed
basis. Each authorized committee of the Board shall include the
director elected by EnerTech. EnerTech shall be entitled to appoint
an observer, who is approved by the Company’s Chief Executive, to all Board
meetings. The Company will reimburse non-employee directors for all
reasonable out-of-pocket expenses incurred in attending board and committee
meetings.
9.6. Successor Indemnification.
In the event that the Company or any of its successors or assigns (i)
consolidates with or merges into any other entity and shall not be the
continuing or surviving corporation or entity of such consolidation or merger or
(ii) transfers or conveys all or substantially all of its properties and assets
to any person or entity, then, and in each such case, to the extent necessary,
proper provision shall be made so that the successors and assigns of the Company
assume the obligations of the Company with respect to indemnification
of members of the Board of Directors as in effect immediately prior to such
transaction, whether in the Company’s bylaws, Certificate of Incorporation, or
elsewhere, as the case may be.
9.7. Transactions with Related
Parties. The Company shall not enter into any business
dealing, undertaking, contract, agreement, lease or other arrangement for the
furnishing to or by the Company of goods, services or space or any other
transaction with any Stockholder or any Affiliate of any Stockholder (an “Affiliate Contract”) and shall
not take any action pertaining to the rights and obligations of the Company
under such Affiliate Contract, without the approval of a majority of the
disinterested members of the Company’s Board of Directors.
9.8. Actions Requiring Majority
Stockholder Approval. Consent of the Stockholders holding a
majority of the outstanding voting shares of Common Stock, which Stockholders
must include EnerTech, provided that (x) EnerTech holds 5% or more of the
Company’s issued and outstanding Common Stock and (y) EnerTech has exercised all
of its rights under Section 4 to acquire
New Securities prior to the termination of such rights under Section 4.2, shall be
required for any action that (including by way of merger, consolidation,
reclassification, reorganization or other similar event) creates, authorizes, or
issues: (i) any class of stock or securities of the Company having any right,
preference, privilege, power or priority superior to the Common Stock, or (ii)
any debt or lease transaction resulting in an obligation to the Company, in the
aggregate, in excess of $3,000,000.
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9.9. Actions Requiring
Super-Majority Stockholder Approval. Consent of the holders of
more than 67% of the outstanding voting shares of the Common Stock shall be
required for any action that (including by way of merger, consolidation,
reclassification, reorganization or other similar event):
(a) increases
or decreases the number of authorized shares of Common Stock or creates or
authorizes any obligation or security convertible into shares of Common
Stock,
(b) liquidates,
dissolves or winds up the business and affairs of the Company or consents to any
of the foregoing,
(c) amends
or waives any provision of the charter, by-laws or articles of the Company in a
manner which adversely affects the holders of the Common Stock,
(d) acquires
any other corporation or entity,
(e) adversely
alters, affects or changes the rights, preferences, privileges, powers, or
interests of, or the restrictions provided for the benefit of, the holders
of the Common Stock,
(f) creates,
authorizes shares of, or issues shares of any class or series of shares stock
having any right, preference, privilege, power or priority on parity with the
Common Stock,
(g) effects
or authorizes any merger, recapitalization, reorganization, acquisition,
consolidation, liquidation, winding up, or sale of all or substantially all of
the assets of the Company,
(h) makes
any loan or advance to, or own any stock or other securities of, any subsidiary
or other corporation, partnership, or other entity unless it is wholly owned by
the Company;
(i) makes
any loan or advance to any person, including, any employee or
director,
(j) guarantees
any indebtedness except for trade accounts of the Company or any subsidiary
arising in the ordinary course of business,
(k) makes
any investment other than investments in prime commercial paper, money market
funds, certificates of deposit in any United States bank having a net worth in
excess of $100,000,000 or obligations issued or guaranteed by the United States
of America, in each case having a maturity not in excess of two years,
or
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(l) enters
into or causes the Company to be a party to any transaction with any director,
officer or employee of the Company or any “associate” (as defined in Rule 12b-2
promulgated under the Exchange Act) of any such person or any Affiliate of the
Company.
9.10. Termination of
Covenants. The
covenants set forth in this Section 9, shall
terminate and be of no further force or effect upon (a) the consummation of the
IPO, or (b) the Company first becoming subject to the periodic reporting
requirements of Sections 12(g) or 15(d) of the Exchange Act, whichever event
shall first occur.
10. Miscellaneous.
10.1. Transfers, Successors and
Assigns. 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. 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.
10.2. Governing
Law. This
Agreement shall be governed by and construed in accordance with the internal
laws of the State of Delaware, without regard to its principles of conflicts of
laws.
10.3. 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. This Agreement may also be executed and delivered by
facsimile signature and 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.
10.4. 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.
10.5. Notices. All
notices and other communications given or made pursuant to this Agreement shall
be in writing and shall be deemed effectively given: (a) upon
personal delivery to the party to be notified, (b) when sent by confirmed
electronic mail or facsimile if sent during normal business hours of the
recipient, and if not so confirmed, then on the next business day, (c) five (5)
days after having been sent by registered or certified mail, return receipt
requested, postage prepaid, or (d) one (1) day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written
verification of receipt. All communications shall be sent to the
respective parties at their address as set forth on the signature page or Schedule A
hereto, or to such email address, facsimile number or address as subsequently
modified by written notice given in accordance with this Section
10.5.
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If notice
is given to the Company or Acorn Energy, a copy shall also be sent
to:
CoaLogix
Inc.
▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention: General Counsel
If notice
is given to EnerTech, a copy shall also be sent to:
Dechert
LLP
▇▇▇▇
Centre
▇▇▇▇ ▇▇▇▇
▇▇.
▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇
Fax No.
(▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇
▇. ▇▇▇▇▇▇▇, Esq.
10.6. Amendments and
Waivers. This
Agreement may be amended or modified and the observance of any term hereof may
be waived (either generally or in a particular instance and either retroactively
or prospectively) only by a written instrument executed by each of the Key
Holders, provided that such consent shall not be required if the Key Holders do
not then own shares representing at least 50% of the outstanding Common
Stock. Any amendment or waiver so effected shall be binding
upon the
Company, the Stockholders and all of their respective successors and permitted
assigns whether or not such party, assignee or other shareholder entered into or
approved such amendment or waiver. Notwithstanding the foregoing, (a)
this Agreement may not be amended or terminated and the observance of any term
hereunder may not be waived with respect to any Stockholder without the written
consent of such Stockholder unless such amendment, termination or waiver applies
to all Stockholders, respectively, in the same fashion and (b) the consent of
the Key Holders shall not be required for any amendment or waiver if such
amendment or waiver does not apply to the Key Holders. The Company
shall give prompt written notice of any amendment or termination hereof or
waiver hereunder to any party hereto that did not consent in writing to such
amendment, termination or waiver. No waivers of or exceptions to any
term, condition or provision of this Agreement, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any
such term, condition or provision.
10.7. Severability. The
invalidity or unenforceability of any provision hereof shall in no way affect
the validity or enforceability of any other provision.
10.8. Additional
Stockholders. Notwithstanding anything to the contrary
contained herein, if the Company shall issue additional shares of Common Stock
or options under the Stock Option Plan after the date hereof, the Company’s
issuance to any purchaser of such shares of Common Stock or recipient of stock
options shall be contingent on such purchaser or option holder becoming a party
to this Agreement by executing and delivering an additional counterpart
signature page to this Agreement and thereafter such purchaser shall be deemed a
“Stockholder” for all purposes hereunder.
-18-
10.9. Entire
Agreement. This
Agreement (including the Exhibits hereto, if any) and the other Transaction
Agreements (as defined in the Purchase Agreement) constitute the full and entire
understanding and agreement between the parties with respect to the subject
matter hereof, and any other written or oral agreement relating to the subject
matter hereof existing between the parties are expressly canceled.
10.10. Transfers of
Rights. Each Stockholder
hereto hereby agrees that it will not, and may, not assign any of its rights and
obligations hereunder, unless such rights and obligations are assigned by such
Stockholder to (a) any person or entity to which Registrable Securities are
transferred by such Stockholder, or (b) to any Affiliate of such Stockholder,
and, in each case, such transferee shall be deemed a “Stockholder” for purposes
of this Agreement; provided that such
assignment of rights shall be contingent upon the transferee providing a written
instrument to the Company notifying the Company of such transfer and assignment
and agreeing in writing to be bound by the terms of this Agreement or such
transfer or assignment shall be void.
10.11. Delays or
Omissions. No delay or omission to exercise any right, power
or remedy accruing to any party under this Agreement, upon any breach or default
of any other
party under this Agreement, shall impair any such right, power or remedy of such
non-breaching or non-defaulting party nor shall it be construed to be a waiver
of any such breach or default, or an acquiescence therein, or of or in any
similar breach or default thereafter occurring; nor shall any waiver of any
single breach or default be deemed a waiver of any other breach or default
theretofore or thereafter occurring. Any waiver, permit, consent or
approval of any kind or character on the part of any party of any breach or
default under this Agreement, or any waiver on the part of any party of any
provisions or conditions of this Agreement, must be in writing and shall be
effective only to the extent specifically set forth in such
writing. All remedies, either under this Agreement or by law or
otherwise afforded to any party, shall be cumulative and not
alternative.
10.12. Effectiveness. This
Agreement shall be effective as of the date hereof.
10.13. Legend on Stock
Certificates. Each certificate representing shares of Common
Stock shall bear a legend substantially in the following form:
“THE
SALE, TRANSFER, ASSIGNMENT, PLEDGE OR ENCUMBRANCE OF THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF AN AMENDED AND
RESTATED STOCKHOLDERS’ AGREEMENT DATED AS OF APRIL 8, 2009 BY AND AMONG THE
ISSUER OF THIS SECURITY AND CERTAIN HOLDERS OF THE STOCK OF SUCH
CORPORATION. COPIES OF SUCH AGREEMENT MAY BE OBTAINED AT NO COST BY
WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE
CORPORATION AT ITS PRINCIPAL EXECUTIVE OFFICE.”
[Remainder
of Page Intentionally Left Blank]
-19-
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
COALOGIX
INC.:
By:
/s/ ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
Title: CEO
By:
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇
▇. ▇▇▇▇▇
Title: CEO
ENERTECH
CAPITAL PARTNERS III L.P.
By:
ECP III Management L.P.,
Its
general partner
By:
ECP III Management LLC,
Its
general partner
By:
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Name:
▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: CEO
-20-
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
/s/
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇
▇▇▇▇
/s/
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇
/s/
▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇ ▇.
▇▇▇▇
/s/
▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
▇▇▇ ▇.
▇▇▇▇▇▇▇, ▇▇.
-21-
SCHEDULE
A
Stockholders
▇ ▇.
▇▇▇▇▇▇▇▇ ▇▇▇▇
▇.▇. ▇▇▇
▇
▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
EnerTech
Capital Partners III L.P.
▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Management
Stockholders
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
▇▇▇▇ ▇.
▇▇▇▇
▇▇▇ ▇.
▇▇▇▇▇▇▇, ▇▇.