Exhibit 10.1
STOCK PURCHASE AGREEMENT
This Agreement dated as of October 23, 2002 ("Effective Date") is entered
into by and among Ultralife Taiwan, Inc., a corporation existing under the laws
of the Republic of China ("ROC"), having a place of business located at No.2-3,
Industry E. Road II, Science-Based Industrial Park, Hsinchu, Taiwan, ROC
("UTI"),
Ultralife Batteries, Inc., a corporation organized under the laws of the State
of Delaware, United States of America, having a place of business located at
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ("UBI"), and
PGT Energy Corporation, a corporation existing under the laws of the ROC, having
a place of business located at 7F-1, ▇▇.▇▇, ▇▇▇-▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ROC
("Purchaser").
(UTI, UBI and Purchaser hereinafter referred to collectly as the "Parties" and
individually as a "Party.")
WHEREAS, UTI owns certain shares of common stock issued by UBI and intends to
transfer such shares to UBI through certain third parties;
WHEREAS, UBI owns Sixty Million Three Hundred Three Thousand and Ninety Three
(60,303,093) shares of common stock issued by UTI and intends to surrender to
UTI certain portion of such shares acquired by UBI for UBI's contribution in
kind to UTI in exchange for transfer of the shares of common stock in UBI held
by UTI and certain obligations committed by UTI hereunder;
WHEREAS, UBI intends to sell to Purchaser certain shares of common stock in UTI
which UBI acquires due to UBI's cash contribution; and
WHEREAS, the Parties will cooperate to complete the transactions contemplated
herein according to the terms and condition set forth hereunder.
NOW, THEREFORE, in consideration of the foregoing and of the covenants and
agreements herein contained and intending to be legally bound, the Parties agree
as follows:
Article 1. Agreement to Sell and Purchase UBI Shares and UTI Shares.
1.1 Upon the terms and subject to the conditions of this Agreement, on the
Closing Date (as defined in Article 2), UTI shall directly or indirectly assign,
transfer and deliver or cause to be assigned, transferred and delivered to UBI
seven hundred thousand (700,000) shares of common stock issued by UBI and
currently held by UTI, together with all rights attached or accrued thereto on
the date hereof including the right to all dividends and distributions declared,
paid or made in respect thereof on or after the date hereof ("UBI Shares") in
exchange of certain shares of common stock in UTI to be surrendered by UBI to
UTI as set forth in Article 1.2.
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1.2 Upon the terms and subject to the conditions of this Agreement, on the
Closing Date, UBI shall surrender to UTI with immediate effect Thirty Two
Million Five Hundred Thousand (32,500,000) shares of common stock issued by UTI
to UBI due to UBI's contribution in kind to UTI, together with all rights
attached or accrued thereto on the date hereof including the right to all
dividends and distributions declared, paid or made in respect thereof on or
after the date hereof ("UTI Technology Shares") in exchange for the transfer of
UBI Shares from UTI to UBI as set forth in Article 1.1.
1.3 Upon the terms and subject to the conditions of this Agreement, on the
Closing Date, UBI shall sell, assign, transfer and deliver or cause to be sold,
assigned, transferred and delivered to Purchaser or the third parties designated
by Purchaser Ten Million (10,000,000) shares of common stock issued by UTI to
UBI for cash contribution, together with all rights attached or accrued thereto
on the date hereof including the right to all dividends and distributions
declared, paid or made in respect thereof on or after the date hereof ("UTI Cash
Shares") for an aggregate purchase price equivalent to Two Million and Four
Hundred Thousand U.S. Dollars (US$2,400,000) ("UTI Cash Shares Purchase Price")
in accordance with the payment schedule in Article 3.1.
Article 2. Closing; Delivery.
2.1. The Closing. The transfer of UBI Shares pursuant to Article 1.1 and
surrender of UTI Technology Shares pursuant to Article 1.2 shall be consummated
at a closing (the "Closing") held at the offices of UTI, on October 23, 2002.,
(the "Closing Date") or at such other time and place upon which the Parties
shall agree.
2.2. Deliveries. At the Closing, the following items shall be delivered:
(i) UTI shall deliver to UBI the original, chopped, and
authenticated stock certificates representing the UBI Shares.
(ii) UBI will deliver to UTI the original, chopped, and
authenticated stock certificates representing the UTI
Technology Shares.
(iii) UBI will deliver to UTI the executed Surrender per form as
Exhibit A.
(iv) UBI will deliver to ▇▇▇ and Li, Attorneys-at-law the executed
Power of Attorney per form as Exhibit B.
(v) UBI will deliver to Purchaser the original, chopped, and
authenticated stock certificates representing the UTI Cash
Shares.
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Article 3. Payments for UTI Cash Shares in Installments.
3.1 Purchaser shall pay to UBI for the UTI Cash Shares Purchase Price in
installments in accordance with the following schedule:
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Payment Due Date Amount
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First: October 30, 2002 US$400,000
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Second: November 7, 2002 US$500,000
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Third: November 14, 2002 US$500,000
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Fourth: November 21, 2002 US$500,000
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Fifth: November 28, 2002 US$500,000
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Any payment(s) made for the second and third payments above within seven (7)
days after the respective due day(s) shall not constitute breach of the payment
schedule as set forth in this Article 3.1. Any payment(s) made for the fourth
and fifth payments above within fourteen (14) days after the respective due
day(s) shall not constitute breach of the payment schedule as set forth in this
Article 3.1.
3.2 Purchaser shall make each payment in accordance with Article 3.1 to
the following bank account of UBI or any bank account designated by UBI which
UBI informs Purchaser in writing ("Designated Bank Account"):
Bank: ▇▇ ▇▇▇▇▇▇ Chase Bank
Swift Code: ▇▇▇▇▇▇▇▇
Account Name: Ultralife Batteries, Inc.
Account Number: 0001474121
3.3 The securities transaction tax for the UTI Cash Shares shall be borne
by UBI and withheld from the UTI Cash Shares Purchase Price for the account of
UBI. Any other taxes payable in connection with this Agreement shall be borne
respectively by the Parties on its own as required by the applicable laws and
regulations.
Article 4. Covenants After Closing.
4.1 Within ten (10) business days after the Closing, UBI shall procure the
foreign investment approval under the Taiwan Statute for Investment by Foreign
Nationals of transfer of UTI Cash Shares.
4.2 In the event that the executed Power of Attorney as provided in
Article 2.2(iv) is required of notarization and legalization, UBI shall cause
such document notarized and legalized within ten (10) business days after
receipt of UTI's request.
4.3 Each Party shall cooperate with the other, take such further action,
and execute and deliver such further documents, as may be reasonably requested
by the other Party in order to carry out the terms and purposes of this
Agreement.
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Article 5. Supply of Lithium Products.
5.1 To induce UBI to surrender to UTI the UTI Technology Shares, UTI
agrees, within three (3) years after the date hereof, to supply UBI the Lithium
Products (as defined in Article 5.2) with the quantities up to ten percent (10%)
per annum of the capacity of UTI's current production line for such Lithium
Products, provided, however, that UBI shall place orders for the Lithium
Products no later than six (6) months prior to the delivery of such products and
the prices, trade terms, payment terms and all other terms and conditions
thereof shall be mutually agreed upon by UTI and UBI.
5.2 For the purpose of this Article 5, Lithium Products shall mean: (i)
rechargable lithium cobalt dioxide cell in cylindrical metal case, cell capacity
between six ampere-hour to ten ampere-hour ("Lithium Product I"); (ii)
rechargable lithium cobalt dioxide cell in thin prismatic metal case, thickness
between 3 mm to 6 mm ("Lithium Product II"); (iii) rechargable lithium cobalt
dioxide polymer cell packed in soft laminated foil ("Lithium Product III").
5.3 In the event that, within three (3) years after the date hereof, UBI
is required by the US or UK military or governmental end users to manufacture
the Lithium Products I within US, UTI agrees to enter into a license agreement
with UBI to grant to UBI a non-transferable, non-exclusive, non-licensable,
royalty-bearing, limited license under the technologies related to Lithium
Products I owned and licensable by UTI to manufacture (excluding have made) the
Lithium Products I at the facilities of UBI to be agreed upon by UBI and UTI for
sale to such US or UK military or governmental end users. The detailed terms and
conditions thereof are to be mutually agreed upon by UBI and UTI.
5.4 UBI's rights of supply in accordance with Artcile 5.1 and license to
be entered into in accordance with Article 5.3 may be terminated by UTI for
convenience with immediate effect, if (i) UBI voluntarily files a petition in
bankruptcy or (ii) UBI has a petition in bankruptcy involuntarily filed against
it, or is placed in an insolvency proceeding, or if an order is entered
appointing a receiver or trustee or a levy or attachment is made against a
substantial portion of its assets which petition, placement, order, levy or
attatchment shall not be vacated within thirty (30) days from date of entry, or
if any assignment for the benefit of its creditors is made; or (iii) UBI has
materially failed in the performance of any material contractual obligation in
Article 5.1 or Article 5.3 and such failure continues uncured for thirty (30)
days after UTI provides notice thereof to UBI; or (iv) any third party, which is
a competitor of UTI acquires directly or indirectly an equity interest greater
than ten percent (10%) in UBI.
Article 6. Representations and Warranties of UTI
UTI hereby represents and warrants to UBI that the statements in this
Article 6, are all true, complete, and not materially misleading in all material
respects as of the Effective Date and at the Closing:
6.1. UTI is a company limited by shares duly organized and validly
existing and UTI (and its representative who executes this Agreement) has all
requisite power and authority to execute and deliver this Agreement and to
perform its obligations hereunder, unless oterhwise provided or reserved herein.
All corporate action on the part of UTI has been taken or will have been taken
prior to the Closing.
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6.2. Neither the entering into nor the delivery of this Agreement nor the
performance of the transactions contemplated therein by UTI will result in the
violation of any of the provisions of the Articles of Incorporation, or other
constitutional or formation documents of UTI or any contract to which UTI is a
party, by which UTI is bound, or any applicable law or permits applicable to
UTI.
6.3 The UBI Shares are free and clear of any security interest, mortgage,
pledge, lien, charge, claim, option, warrant, equity, easement, limitation,
restriction, royalty, preemptive or other right, restraint on alienation, voting
trust or arrangement, proxy, or encumbrance of any kind.
Article 7. Representations and Warranties of UBI
UBI hereby represents and warrants to UTI and Purchaser that the
statements in this Article 7, are all true, complete, and not materially
misleading in all material respects as of the Effective Date and at the Closing:
7.1. UBI is a company limited by shares duly organized and validly
existing and UBI (and its representative who executes this Agreement) has all
requisite power and authority to execute and deliver this Agreement and to
perform its obligations hereunder, unless oterhwise provided or reserved herein.
All corporate action on the part of UBI has been taken or will have been taken
prior to the Closing.
7.2. Neither the entering into nor the delivery of this Agreement nor the
performance of the transactions contemplated therein by UBI will result in the
violation of any of the provisions of the Articles of Incorporation, or other
constitutional or formation documents of UBI or any contract to which UBI is a
party, by which UBI is bound, or any applicable law or permits applicable to
UBI.
7.3 The UTI Technology Shares and the UTI Cash Shares are free and clear
of any security interest, mortgage, pledge, lien, charge, claim, option,
warrant, equity, easement, limitation, restriction, royalty, preemptive or other
right, restraint on alienation, voting trust or arrangement, proxy, or
encumbrance of any kind.
Article 8. Confidentiality.
8.1 The Parties shall keep all confidential information, which it acquires
pursuant to this Agreement and is not, at the time of such disclosure, publicly
available strictly confidential. The terms and conditions of this Agreement and
all exhibits and schedules attached hereto and thereto, including their
existence, shall be considered confidential information and shall not be
disclosed by any Party to any third party except in accordance with the
provisions set forth below.
8.2 In the event that either Party becomes legally compelled (including
without limitation, pursuant to securities laws and regulations) to disclose the
existence of this Agreement, such Party shall provide the other Parties with
prompt written notice of that fact and furnish only that portion of the
information which is legally required and exercise reasonable
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efforts to obtain reliable assurance that confidential treatment will be
accorded such information to the extent reasonably requested by the other
Parties.
Article 9. Miscellaneous.
9.1. Governing Law and Venue. This Agreement shall be governed in all
respects by the laws of the ROC without regard to provisions regarding choice of
laws, and the Hsinchu District Court shall have non-exclusive jurisdiction over
any dispute arising under this Agreement.
9.2. Survival. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any Party and the Closing of
the transactions contemplated hereby.
9.3. Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the permitted successors, assigns, heirs, executors and administrators of
the Parties. No Party may assign, in whole or in part, its rights or obligations
under this Agreement to any third party without the other Parties' express
written consent.
9.4. Entire Agreement. This Agreement together with the exhibits and
schedules hereto constitute the entire understanding and agreement among the
Parties with regard to the subjects hereof and supersede all prior agreements
and understandings.
9.5. Notices. Except as may be otherwise provided herein, all notices,
requests, waivers and other communications made pursuant to this Agreement shall
be made in writing and delivered by hand, mail, facsimile, overnight delivery
service, or any other mode of communication routinely used by the Parties in
their course of dealing to the address and number set forth below the
recipient's signature below, or to such other address and/or number as the
recipient may indicate in writing. Any notice or communication delivered by hand
shall be deemed to have been received when delivered, and sent by mail shall be
deemed to have been received seven (7) days after the date on which such notice
or communication is deposited in the mail. Facsimile notices or communications
shall be deemed to be received on the date of receipt of the confirmation of
transmission.
9.6. Amendments and Waivers. No amendment or waiver of any provision of
this Agreement or of any right or remedy arising hereunder shall be enforceable
unless in writing signed by the Party against whom enforcement is sought.
9.7. Delays or Omissions. No delay or omission to exercise any right,
power or remedy accruing to either Parties upon any breach or default of the
other Party shall impair any such right, power or remedy of the aggrieved Party
nor shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of any similar breach or default thereafter occurring.
9.8. Attorneys Fees. In the event of any dispute among the Parties
concerning this Agreement or the transactions or matters referred to or provided
for herein, the prevailing Party shall be entitled to reasonable attorneys' fees
and costs in addition to such other relief as may be
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granted. The phrase "prevailing Party" shall mean the Party who is determined in
a proceeding to have prevailed or who prevails by dismissal, default or
otherwise.
9.9. Costs. Unless it is stipulated otherwise in this Agreement, the
Parties shall bear their own costs and expenses incurred in connection with this
Agreement, the preparation thereof and the preparation for the Closing,
including professional fees and costs of their attorneys and accountants.
9.10. Titles and Subtitles. The titles of the sections and subsections of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
9.11. Counterparts. This Agreement may be executed in any number of
English-language counterparts, each of which shall be an original, but all of
which together shall constitute one instrument.
9.12 Severability. If, in light of a particular set of facts and
circumstances, any provision or provisions of this Agreement will be held to be
invalid or unenforceable by any court or arbitrator of competent jurisdiction,
then: (i) the validity and enforceability of such provision or provisions as
applied to any other particular facts or circumstances and the validity of other
provisions of this Agreement will not in any way be affected or impaired
thereby; and (ii) such provision or provisions will be reformed without further
action by the Parties, but only to the extent necessary to make such provision
or provisions valid and enforceable when applied to such particular facts and
circumstances.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first above written.
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Ultralife Taiwan, Inc.
By /s/ ▇.▇. ▇▇▇
---------------
Name: ▇.▇. ▇▇▇
Title: Chairman
Address for notices:
No.2-3, Industry E. Road II, Science-Based
Industrial Park, Hsinchu, Taiwan, ROC
Attn.: Chairman
Fax Number: ▇▇▇-▇-▇▇▇▇▇▇▇
PGT Energy Corporation
By /s/ ▇.▇. ▇▇▇
----------------
Name: ▇.▇. ▇▇▇
Title: Chairman
Address for notices:
7F-1, ▇▇.▇▇, ▇▇▇-▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇
▇▇▇▇.: Chairman
Fax Number: ▇▇▇-▇-▇▇▇▇▇▇▇
Ultralife Batteries, Inc.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: CEO and authorized representative
Address for notices:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Secretary of Corporation
Fax Number:▇-▇▇▇-▇▇▇-▇▇▇▇
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Exhibit A
SURRENDER
To: Ultralife Taiwan, Inc.
The Undersigned, a corporation organized under the laws of the State of
Delaware, United States of America, having a place of business located at ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇, is the corporate shareholder of
Ultralife Taiwan, Inc., a corporation existing under the laws of the Republic of
China, having a place of business located at No.2-3, Industry E. Road II,
Science-Based Industrial Park, Hsinchu, Taiwan, ROC ("UTI"), and hereby
irrevocably surrenders to UTI with immediate effect the right and title to
Thirty Two Million Five Hundred Thousand (32,500,000) shares of common stock
issued by UTI to the Undersigned for the Undersigned's contribution in kind to
UTI in accordance with the Joint Venture Agreement entered into by PGT Energy
Corporation and the Undersigned dated October 10, 1998 ("UTI Technology Shares")
for the sole purpose that UTI cancels the UTI Technology Shares and makes the
corresponding reduction of the paid-in capital of UTI.
For the above purpose, the Undersigned further agrees to authorize ▇▇▇ and Li,
Attorneys-at-Law ("Attorney-in-fact") to affix the Chinese chop of the
Undersigned currently kept by ▇▇▇ and Li, Attorneys-at-Law ("Chop") on all
documents necessary for consummation of cancellation of the UTI Technology
Shares and the corresponding reduction of the paid-in capital of UTI.
In the event that UTI is requried by the ROC government authority to convene the
shareholders meeting of UTI to resolve to cancel the UTI Technology Shares and
to make the corresponding reduction of the paid-in capital of UTI, the
Undersigned hereby authorize the Attorney-in-fact to take all necessary measures
including without limitation affixing the Chop on the proxy for such
shareholders meeting to authorize PGT Energy Corporation, a corporation existing
under the laws of the ROC, having a place of business located at 7F-1, ▇▇.▇▇,
▇▇▇-▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ROC, as the Undersigned's proxy to vote for
cancellation of the UTI Technology Shares and the corresponding reduction of the
paid-in capital of UTI.
IN WITNESS HEREOF, the Undersigned has caused this instrument to be executed in
the city of Hsinchu, Taiwan, Republic of China on the 23rd day of October 2002.
Ultralife Batteries, Inc.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: CEO and authorized representative
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Exhibit B
POWER OF ATTORNEY
To ▇▇▇ and Li, Attorneys-at-Law
The Undersigned, a corporation organized under the laws of the State of
Delaware, United States of America, having a place of business located at ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇, hereby irrevocably constitute and
appoint you to be the attorney-in-fact ("Attorney-in-fact ") of the Undersigned
with full power of substitution and revocation to (i) transfer the right and
title to UTI Cash Shares (as defined in Article 1.3) to Purchaser on behalf of
the Undersigned in accordance with Article 3.1 and (ii) surrender the right and
title to UTI Technology Shares (as defined in Article 1.2) to UTI on behalf of
the Undersigned in accordance with Article 1.2, including without limitation,
provision and execution of any and all documents and acts necessary for
consummation herein.
IN WITNESS HEREOF, the Undersigned has caused this instrument to be executed in
the city of Hsinchu, Taiwan, Republic of China on the 23rd day of October 2002.
Ultralife Batteries, Inc.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: CEO and authorized representative
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