Exhibit 10.2

 

REGISTRATION RIGHTS AGREEMENT

 

BY AND AMONG

 

TOWER TECH HOLDINGS INC.

 

AND

 

THE MEMBERS OF

 

ENERGY MAINTENANCE SERVICE, LLC

 

JANUARY 16, 2008

 

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TABLE OF CONTENTS

 

 

 

 

Page

ARTICLE 1

 

Definitions

1

 

 

 

 

ARTICLE 2

 

Registration Rights

3

 

 

 

 

2.1

 

Current Public Information

3

 

 

 

 

2.2

 

Demand Registration

3

 

 

 

 

2.3

 

Piggyback Registration

6

 

 

 

 

2.4

 

Underwriting; Holdback Agreements

7

 

 

 

 

2.5

 

Registration Procedures

8

 

 

 

 

2.6

 

Conditions Precedent to Company’s Obligations Pursuant to this Agreement

10

 

 

 

 

2.7

 

Fees and Expenses

10

 

 

 

 

2.8

 

Indemnification

11

 

 

 

 

2.9

 

Participation in Registrations

14

 

 

 

 

2.1

0

Compliance

15

 

 

 

 

ARTICLE 3

 

Transfers of Certain Rights

15

 

 

 

 

3.1

 

Transfer

15

 

 

 

 

3.2

 

Transferees

15

 

 

 

 

3.3

 

Subsequent Transferees

15

 

 

 

 

ARTICLE 4

 

Representations of Purchasers

15

 

 

 

 

4.1

 

Certain Representations of the Purchasers

15

 

 

 

 

4.2

 

Effect of Representations

16

 

 

 

 

ARTICLE 5

 

Miscellaneous

17

 

 

 

 

5.1

 

Recapitalizations, Exchanges, etc

17

 

 

 

 

5.2

 

No Inconsistent Agreements

17

 

 

 

 

5.3

 

Amendments and Waivers

17

 

 

 

 

5.4

 

Severability

17

 

 

 

 

5.5

 

Counterparts

17

 

 

 

 

5.6

 

Notices

17

 

 

 

 

5.7

 

Governing Law

19

 

 

 

 

5.8

 

Forum; Service of Process

19

 

 

 

 

5.9

 

Captions

19

 

 

 

 

5.1

0

No Prejudice

19

 

 

 

 

5.1

1

Words in Singular and Plural Form

19

 

 

 

 

5.1

2

Remedy for Breach

19

 

 

 

 

5.1

3

Successors and Assigns, Third Party Beneficiaries

19

 

 

 

 

5.1

4

Entire Agreement

19

 

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5.1

5

Attorneys’ Fees

20

 

 

 

 

5.1

6

Termination of Rights

20

 

ii

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REGISTRATION RIGHTS AGREEMENT

 

This REGISTRATION RIGHTS AGREEMENT, dated as of January 16, 2008 (the
“Agreement”), is entered into by and among TOWER TECH HOLDINGS INC., a Nevada
corporation (the “Company”), EMS, Inc., a South Dakota corporation (“EMS”),
Fagen, Inc., a Minnesota corporation (“Fagen”), Joseph A. Kolbach, an individual
residing at 3771 Edgewater Drive, Gary, South Dakota 57237 (“Kolbach”) and
Daniel A. Yarano, an individual residing at 2169 Edgcumbe Road, St. Paul, MN
(“Yarano”) (EMS, Fagen, Kolbach and Yarano are collectively referred to herein
as the “Purchasers”).

 

RECITALS:

 

A.                                   The Company desires to issue and sell one
million six hundred twenty-nine thousand eight hundred thirty-four and
ninety-one-hundredths (1,629,834.91) shares of its Common Stock to the Holders
as set forth in the Membership Interest Purchase Agreement, dated as of
December 9, 2007, as amended by that certain Amendment No. 1 to Membership
Interest Purchase Agreement dated as of January 8, 2008, entered into by and
among the Company, Energy Maintenance Service, LLC and the Purchasers (the
“Purchase Agreement”);

 

B.                                     It is a condition precedent to the
consummation of the transactions contemplated by the Purchase Agreement that the
Company provide for the rights set forth in this Agreement; and

 

C.                                     Certain terms used in this Agreement are
defined in Article 1 hereof.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants and agreements hereinafter contained, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
intending to be legally bound, the parties hereto hereby agree as follows:

 

ARTICLE 1
DEFINITIONS

 

“Affiliate” means any Person that directly or indirectly controls, or is under
control with, or is controlled by such Person.  As used in this definition,
“control” (including with its correlative meanings, “controlled by” and “under
common control with”) shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a Person
(whether through ownership of securities or partnership or other ownership
interests, by contract or otherwise).

 

“Business Day” means any day excluding Saturday, Sunday or any other day which
is a legal holiday under the laws of the State of Wisconsin or is a day on which
banking institutions therein located are authorized or required by law or other
governmental action to close.

 

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 “Closing Date” has the meaning ascribed to such term in the Purchase Agreement.

 

“Common Stock” means the common stock, par value $0.001 per share, of the
Company.

 

“Company” has the meaning set forth in the preamble.

 

“Demand Notice” has the meaning set forth in Section 2.2.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.

 

“Holders” means holders of the Registrable Securities.

 

“Indemnified Party” has the meaning set forth in Section 2.8.

 

“Losses” has the meaning set forth in Section  2.8.

 

“Majority Holders” means those Holders holding at least a majority of the
Registrable Securities.

 

“Person” means any individual, company, partnership, firm, joint venture,
association, joint-stock company, trust, unincorporated organization,
governmental body or other entity.

 

“Piggyback Registration” has the meaning set forth in Section 2.3.

 

“Purchase Agreement” has the meaning set forth in the preamble.

 

“Purchase Price” has the meaning ascribed to such term in the Purchase
Agreement.

 

“Purchasers” has the meaning set forth in the preamble.

 

“Registrable Securities” means, subject to the immediately following sentences,
(i) shares of Common Stock acquired by the Purchasers from the Company pursuant
to the Purchase Agreement and so long as this Agreement is still in effect, any
other shares of Common Stock acquired by the Purchasers on or after the Closing
Date, and (ii) any shares of Common Stock issued or issuable, directly or
indirectly, with respect to the securities referred to in clause (i) by way of
stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization.  In addition,
any particular shares of Common Stock constituting Registrable Securities will
cease to be Registrable Securities when (x) their offer and sale have been
effectively registered under the Securities Act and disposed of in accordance
with a Registration Statement covering such offer and sale, (y) they have been
sold to the public pursuant to Rule 144 (or by similar provision under the
Securities Act), or (z) are eligible for resale by the Holder thereof under
Rule 144(k) (or by similar provision under the Securities Act) without any
limitation on the amount of securities that may be sold under paragraph
(e) thereof.

 

“Registration Statement” means a registration statement on Form S-3 (or, if the
Company is not eligible to use Form S-3, such other appropriate registration
form of the SEC

 

2

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pursuant to which the Company is eligible to register the resale of Registrable
Securities) filed by the Company under the Securities Act which covers any of
the Registrable Securities pursuant to the provisions of this Agreement,
including the prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits and all material
incorporated by reference in such registration statement, which shall permit the
Purchasers to offer and sell, on a delayed or continuous basis pursuant to
Rule 415 under the Securities Act, the Registrable Securities.

 

“register,” “registered” and “registration” each shall refer to a registration
effected by preparing and filing a registration statement or statements or
similar documents in compliance with the Securities Act and the declaration or
ordering of effectiveness of such registration statement(s) or documents by the
SEC.

 

“Rule 144” means Rule 144 promulgated by the SEC pursuant to the Securities Act,
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC having substantially the same effect as such Rule.

 

“Rule 415” means Rule 415 promulgated by the SEC pursuant to the Securities Act,
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC having substantially the same effect as such Rule.

 

“SEC” means the United States Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act and Exchange Act.

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder.

 

ARTICLE 2
REGISTRATION RIGHTS

 

2.1                                 Current Public Information.  The Company
covenants that it will use its best efforts to file all reports required to be
filed by it under the Exchange Act and will use its reasonable best efforts to
take such further action as the Holders may reasonably request, all to the
extent required to enable the Holders to sell Registrable Securities pursuant to
Rule 144 adopted by the SEC under the Securities Act or any similar rule or
regulation hereafter adopted by the SEC.  The Company shall, upon the request of
a Holder, deliver to such Holder a written statement as to whether it has
complied with such requirements during the twelve month period immediately
preceding the date of such request.

 

2.2                                 Demand Registration.

 

(A)       AT ANY TIME AFTER THE ONE YEAR ANNIVERSARY OF THIS AGREEMENT AND UPON
THE WRITTEN REQUEST OF THE MAJORITY HOLDERS, REQUESTING THAT THE COMPANY EFFECT
THE REGISTRATION UNDER THE SECURITIES ACT OF ALL OR PART OF SUCH HOLDERS’
REGISTRABLE SECURITIES AND SPECIFYING THE INTENDED METHOD OF DISPOSITION THEREOF
(THE “DEMAND NOTICE”), THE COMPANY WILL PROMPTLY GIVE WRITTEN NOTICE OF SUCH
REQUESTED REGISTRATION TO ALL HOLDERS, AND THEREUPON THE COMPANY WILL USE ITS
REASONABLE BEST EFFORTS TO FILE WITH THE SEC AS SOON AS REASONABLY PRACTICABLE
FOLLOWING THE

 

3

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DEMAND NOTICE (BUT IN NO EVENT LATER THAN THE DATE THAT IS 90 DAYS AFTER THE
DEMAND NOTICE) A REGISTRATION STATEMENT.  THE COMPANY SHALL USE ITS REASONABLE
BEST EFFORTS TO CAUSE SUCH REGISTRATION STATEMENT TO BE DECLARED EFFECTIVE BY
THE SEC WITHIN 90 DAYS AFTER THE INITIAL FILING OF THE REGISTRATION STATEMENT,
AND IF SUCH REGISTRATION STATEMENT IS NOT DECLARED EFFECTIVE WITHIN 90 DAYS
AFTER ITS INITIAL FILING, AS SOON AS POSSIBLE THEREAFTER.  THE COMPANY SHALL
INCLUDE IN SUCH REGISTRATION STATEMENT:

 

(I)                                     THE REGISTRABLE SECURITIES WHICH THE
HOLDERS HAVE REQUESTED TO BE REGISTERED BY THE COMPANY FOR DISPOSITION IN
ACCORDANCE WITH THE INTENDED METHOD OF DISPOSITION STATED IN SUCH REQUEST;

 

(II)                                  ALL OTHER REGISTRABLE SECURITIES THE
HOLDERS OF WHICH SHALL HAVE MADE A WRITTEN REQUEST TO THE COMPANY FOR
REGISTRATION THEREOF WITHIN 30 DAYS AFTER THE GIVING OF SUCH WRITTEN NOTICE BY
THE COMPANY (WHICH REQUEST SHALL SPECIFY THE INTENDED METHOD OF DISPOSITION OF
SUCH REGISTRABLE SECURITIES); AND

 

(III)                               ALL SHARES OF COMMON STOCK WHICH THE COMPANY
OR PERSONS ENTITLED TO EXERCISE “PIGGY-BACK” REGISTRATION RIGHTS PURSUANT TO
CONTRACTUAL COMMITMENTS OF THE COMPANY MAY ELECT TO REGISTER IN CONNECTION WITH
THE OFFERING OF REGISTRABLE SECURITIES PURSUANT TO THIS SECTION 2.2;

 

all to the extent requisite to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities and the
additional shares of Common Stock, if any, so to be registered; provided, that,
the provisions of this Section 2.2 shall not require the Company to effect more
than one registration of Registrable Securities.

 

(B)                                 NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED IN THIS AGREEMENT, THE COMPANY SHALL NOT BE REQUIRED TO EFFECT A
REGISTRATION PURSUANT TO THIS SECTION 2.2 WITHIN 180 DAYS FOLLOWING THE
EFFECTIVE DATE OF A REGISTRATION STATEMENT FILED BY THE COMPANY IN ACCORDANCE
WITH SECTION 2.3 FOR THE ACCOUNT OF ANOTHER HOLDER OF REGISTRABLE SECURITIES IF
THE HOLDERS WERE AFFORDED THE OPPORTUNITY TO INCLUDE THE REGISTRABLE SECURITIES
IN SUCH REGISTRATION.

 

(C)          THE REGISTRATION UNDER THIS SECTION 2.2 SHALL BE ON AN APPROPRIATE
REGISTRATION STATEMENT THAT PERMITS THE DISPOSITION OF SUCH REGISTRABLE
SECURITIES IN ACCORDANCE WITH THE INTENDED METHODS OF DISTRIBUTION SPECIFIED BY
THE MAJORITY HOLDERS IN THEIR REQUEST FOR REGISTRATION.  THE COMPANY AGREES TO
INCLUDE IN ANY SUCH REGISTRATION STATEMENT ALL INFORMATION WHICH HOLDERS OF
REGISTRABLE SECURITIES BEING REGISTERED SHALL REASONABLY REQUEST TO EFFECT THE
REGISTRATION.

 

(D)         A REGISTRATION REQUESTED PURSUANT TO THIS SECTION 2.2 SHALL NOT BE
DEEMED TO HAVE BEEN EFFECTED (I) UNLESS A REGISTRATION STATEMENT WITH RESPECT
THERETO REGISTERING ALL OF THE REGISTRABLE SECURITIES INITIALLY INCLUDED ON SUCH
REGISTRATION STATEMENT PURSUANT TO SECTION 2.2(A)(I) AND (II) HAS BECOME
EFFECTIVE; PROVIDED, THAT A REGISTRATION STATEMENT WHICH DOES NOT BECOME
EFFECTIVE AFTER THE COMPANY HAS FILED A REGISTRATION STATEMENT WITH RESPECT
THERETO SOLELY BY REASON OF THE REFUSAL TO PROCEED OF THE MAJORITY HOLDERS
(OTHER THAN A REFUSAL TO PROCEED BASED UPON THE ADVICE OF COUNSEL RELATING TO A
MATTER WITH RESPECT TO THE COMPANY) OR BECAUSE OF A BREACH OF THIS AGREEMENT BY
ANY HOLDER SHALL BE DEEMED TO HAVE BEEN EFFECTED BY THE

 

4

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COMPANY AT THE REQUEST OF THE MAJORITY HOLDERS UNLESS THE HOLDERS ELECTING TO
HAVE REGISTRABLE SECURITIES REGISTERED PURSUANT TO SUCH REGISTRATION STATEMENT
SHALL HAVE ELECTED TO PAY ALL FEES AND EXPENSES OTHERWISE PAYABLE BY THE COMPANY
IN CONNECTION WITH SUCH REGISTRATION PURSUANT TO SECTION 2.7, (II) IF, AFTER IT
HAS BECOME EFFECTIVE, SUCH REGISTRATION IS WITHDRAWN BY THE COMPANY (OTHER THAN
AT THE REQUEST OF THE MAJORITY HOLDERS) OR INTERFERED WITH BY ANY STOP ORDER,
INJUNCTION OR OTHER ORDER OR REQUIREMENT OF THE SEC OR OTHER GOVERNMENTAL AGENCY
OR COURT FOR ANY REASON PRIOR TO THE EXPIRATION OF A 180 DAY PERIOD FOLLOWING
SUCH REGISTRATION STATEMENT’S EFFECTIVENESS; PROVIDED, HOWEVER, THAT THE COMPANY
SHALL REMAIN OBLIGATED TO USE ITS REASONABLE BEST EFFORTS TO OBTAIN THE
WITHDRAWAL OF SUCH STOP ORDER AND OTHERWISE UNDERTAKE ITS OBLIGATIONS AS SET
FORTH IN SECTION 2.5 WITH RESPECT TO SUCH REGISTRATION STATEMENT, OR (III) IF
THE CONDITIONS TO CLOSING SPECIFIED IN ANY PURCHASE AGREEMENT OR UNDERWRITING
AGREEMENT ENTERED INTO IN CONNECTION WITH SUCH REGISTRATION ARE NOT SATISFIED,
OTHER THAN DUE SOLELY TO SOME ACT OR OMISSION BY THE HOLDERS ELECTING TO HAVE
REGISTRABLE SECURITIES REGISTERED PURSUANT TO SUCH REGISTRATION STATEMENT.

 

(E)          IF THE REQUESTED REGISTRATION PURSUANT TO THIS SECTION 2.2 INVOLVES
AN UNDERWRITTEN OFFERING, AND THE MANAGING UNDERWRITER SHALL ADVISE THE COMPANY
IN WRITING (WITH A COPY TO EACH HOLDER OF REGISTRABLE SECURITIES REQUESTING
REGISTRATION) THAT, IN ITS OPINION, THE NUMBER OF SECURITIES REQUESTED TO BE
INCLUDED IN SUCH REGISTRATION (INCLUDING SECURITIES OF THE COMPANY WHICH ARE NOT
REGISTRABLE SECURITIES) EXCEEDS THE NUMBER WHICH CAN BE SOLD IN SUCH OFFERING
WITHIN A PRICE RANGE REASONABLY ACCEPTABLE TO THE COMPANY AND TO THE HOLDERS OF
A MAJORITY (BY NUMBER OF SHARES) OF THE REGISTRABLE SECURITIES REQUESTED TO BE
INCLUDED IN SUCH REGISTRATION STATEMENT, THE COMPANY WILL INCLUDE IN SUCH
REGISTRATION, TO THE EXTENT OF THE NUMBER WHICH THE COMPANY IS SO ADVISED CAN BE
SOLD IN SUCH OFFERING, (I) FIRST, THE REGISTRABLE SECURITIES WHICH HAVE BEEN
REQUESTED TO BE INCLUDED IN SUCH REGISTRATION BY THE HOLDERS PURSUANT TO THIS
AGREEMENT (PRO RATA BASED ON THE AMOUNT OF REGISTRABLE SECURITIES SOUGHT TO BE
REGISTERED BY SUCH PERSONS), (II) SECOND, PROVIDED THAT NO SECURITIES SOUGHT TO
BE INCLUDED BY THE HOLDERS HAVE BEEN EXCLUDED FROM SUCH REGISTRATION, THE
SECURITIES OF OTHER PERSONS ENTITLED TO EXERCISE “PIGGY-BACK” REGISTRATION
RIGHTS PURSUANT TO CONTRACTUAL COMMITMENTS OF THE COMPANY (PRO RATA BASED ON THE
AMOUNT OF SECURITIES SOUGHT TO BE REGISTERED BY SUCH PERSONS) AND (III) THIRD,
SECURITIES THE COMPANY PROPOSES TO REGISTER.

 

(F)            THE COMPANY SHALL USE ITS REASONABLE BEST EFFORTS TO KEEP ANY
REGISTRATION STATEMENT FILED PURSUANT TO THIS SECTION 2.2 CONTINUOUSLY EFFECTIVE
UNTIL THE REGISTRABLE SECURITIES REGISTERED PURSUANT TO SUCH REGISTRATION
STATEMENT CEASE TO CONSTITUTE REGISTRABLE SECURITIES.

 

(G)         THE COMPANY SHALL HAVE THE RIGHT AT ANY TIME, TO SUSPEND THE FILING
OF A REGISTRATION STATEMENT UNDER THIS SECTION 2.2 OR REQUIRE THAT THE HOLDERS
OF REGISTRABLE SECURITIES SUSPEND FURTHER OPEN MARKET OFFERS AND SALES OF
REGISTRABLE SECURITIES PURSUANT TO A REGISTRATION STATEMENT FILED HEREUNDER FOR
A PERIOD NOT TO EXCEED AN AGGREGATE OF 30 DAYS IN ANY SIX MONTH PERIOD OR AN
AGGREGATE OF 60 DAYS IN ANY TWELVE-MONTH PERIOD FOR VALID BUSINESS REASONS (NOT
INCLUDING AVOIDANCE OF THEIR OBLIGATIONS HEREUNDER) (I) TO AVOID PREMATURE
PUBLIC DISCLOSURE OF A PENDING CORPORATE TRANSACTION, INCLUDING PENDING
ACQUISITIONS OR DIVESTITURES OF ASSETS, MERGERS AND COMBINATIONS AND SIMILAR
EVENTS; (II) UPON THE OCCURRENCE OF ANY OF THE EVENTS SPECIFIED IN
SECTION 2.5(E), UNTIL THE TIME THAT THE HOLDERS RECEIVE COPIES OF A SUPPLEMENT
OR AMENDMENT TO THE PROSPECTUS INCLUDED IN THE APPLICABLE REGISTRATION STATEMENT
AS CONTEMPLATED IN

 

5

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SECTION 2.5(E); AND (III) UPON THE OCCURRENCE OF ANY OF THE EVENTS SPECIFIED IN
SECTION 2.5(I), UNTIL THE TIME THE COMPANY NOTIFIES THE HOLDERS IN WRITING THAT
SUCH SUSPENSION IS NO LONGER EFFECTIVE.

 

2.3                                 PIGGYBACK REGISTRATION.

 

(A)       WHENEVER THE COMPANY PROPOSES TO REGISTER ANY OF ITS SECURITIES UNDER
THE SECURITIES ACT (OTHER THAN PURSUANT TO A REGISTRATION PURSUANT TO
SECTION 2.2, A REGISTRATION ON FORM S-4 OR S-8 OR ANY SUCCESSOR OR SIMILAR
FORMS, OR THE INITIAL REGISTRATION STATEMENT, OR ANY SUBSEQUENT REGISTRATION
STATEMENT, RELATED TO A RIGHTS OFFERING BY THE COMPANY) AND THE REGISTRATION
FORM TO BE USED MAY BE USED FOR THE REGISTRATION OF REGISTRABLE SECURITIES,
WHETHER OR NOT FOR SALE FOR ITS OWN ACCOUNT, THE COMPANY WILL GIVE PROMPT
WRITTEN NOTICE (BUT IN NO EVENT LESS THAN 30 DAYS BEFORE THE ANTICIPATED FILING
DATE) TO ALL HOLDERS (OTHER THAN HOLDERS ALL OF WHOSE REGISTRABLE SECURITIES ARE
THEN COVERED BY AN EFFECTIVE REGISTRATION STATEMENT), AND SUCH NOTICE SHALL
DESCRIBE THE PROPOSED REGISTRATION AND DISTRIBUTION AND OFFER TO ALL SUCH
HOLDERS THE OPPORTUNITY TO REGISTER THE NUMBER OF REGISTRABLE SECURITIES AS EACH
SUCH HOLDER MAY REQUEST.  THE COMPANY WILL INCLUDE IN SUCH REGISTRATION
STATEMENT ALL REGISTRABLE SECURITIES WITH RESPECT TO WHICH THE COMPANY HAS
RECEIVED WRITTEN REQUESTS FOR INCLUSION THEREIN WITHIN 15 DAYS AFTER THE
HOLDERS’ RECEIPT OF THE COMPANY’S NOTICE (A “PIGGYBACK REGISTRATION”).

 

(B)      THE COMPANY SHALL USE ITS REASONABLE BEST EFFORTS TO CAUSE THE MANAGING
UNDERWRITER OR UNDERWRITERS OF A PROPOSED UNDERWRITTEN OFFERING INVOLVING A
PIGGYBACK REGISTRATION TO PERMIT THE REGISTRABLE SECURITIES REQUESTED TO BE
INCLUDED IN A PIGGYBACK REGISTRATION TO BE INCLUDED ON THE SAME TERMS AND
CONDITIONS AS ANY SIMILAR SECURITIES OF THE COMPANY OR ANY OTHER SECURITY HOLDER
INCLUDED THEREIN AND TO PERMIT THE SALE OR OTHER DISPOSITION OF SUCH REGISTRABLE
SECURITIES IN ACCORDANCE WITH THE INTENDED METHOD OF DISTRIBUTION THEREOF.

 

(C)       ANY HOLDER SHALL HAVE THE RIGHT TO WITHDRAW ITS REQUEST FOR INCLUSION
OF ITS REGISTRABLE SECURITIES IN ANY REGISTRATION STATEMENT PURSUANT TO THIS
SECTION 2.3 BY GIVING WRITTEN NOTICE TO THE COMPANY OF ITS REQUEST TO WITHDRAW;
PROVIDED, THAT IN THE EVENT OF SUCH WITHDRAWAL (OTHER THAN PURSUANT TO
SECTION 2.3(E) HEREOF), THE COMPANY SHALL NOT BE REQUIRED TO REIMBURSE SUCH
HOLDER FOR THE FEES AND EXPENSES REFERRED TO IN SECTION 2.7 HEREOF INCURRED BY
SUCH HOLDER PRIOR TO SUCH WITHDRAWAL, UNLESS SUCH WITHDRAWAL WAS DUE TO A
MATERIAL ADVERSE CHANGE TO THE COMPANY.  THE COMPANY MAY WITHDRAW A PIGGYBACK
REGISTRATION AT ANY TIME PRIOR TO THE TIME IT BECOMES EFFECTIVE.

 

(D)      IF (I) A PIGGYBACK REGISTRATION INVOLVES AN UNDERWRITTEN OFFERING OF
THE SECURITIES BEING REGISTERED, WHETHER OR NOT FOR SALE FOR THE ACCOUNT OF THE
COMPANY, TO BE DISTRIBUTED (ON A FIRM COMMITMENT BASIS) BY OR THROUGH ONE OR
MORE UNDERWRITERS OF RECOGNIZED STANDING UNDER UNDERWRITING TERMS APPROPRIATE
FOR SUCH A TRANSACTION, AND (II) THE MANAGING UNDERWRITER OF SUCH UNDERWRITTEN
OFFERING SHALL INFORM THE COMPANY AND HOLDERS REQUESTING SUCH REGISTRATION BY
LETTER OF ITS BELIEF THAT THE DISTRIBUTION OF ALL OR A SPECIFIED NUMBER OF SUCH
REGISTRABLE SECURITIES CONCURRENTLY WITH THE SECURITIES BEING DISTRIBUTED BY
SUCH UNDERWRITERS WOULD INTERFERE WITH THE SUCCESSFUL MARKETING OF THE
SECURITIES BEING DISTRIBUTED BY SUCH UNDERWRITERS (SUCH WRITING TO STATE THE
BASIS OF SUCH BELIEF AND THE APPROXIMATE NUMBER OF SUCH REGISTRABLE SECURITIES
WHICH MAY BE DISTRIBUTED WITHOUT SUCH EFFECT), THEN THE COMPANY WILL BE REQUIRED
TO INCLUDE IN SUCH REGISTRATION ONLY THE AMOUNT OF SECURITIES WHICH IT IS SO
ADVISED SHOULD BE INCLUDED IN SUCH REGISTRATION.  IN SUCH EVENT: (X) IN CASES
INITIALLY INVOLVING THE

 

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REGISTRATION FOR SALE OF SECURITIES FOR THE COMPANY’S OWN ACCOUNT, SECURITIES
SHALL BE REGISTERED IN SUCH OFFERING IN THE FOLLOWING ORDER OF PRIORITY:
(I) FIRST, THE SECURITIES WHICH THE COMPANY PROPOSES TO REGISTER, AND
(II) SECOND, REGISTRABLE SECURITIES AND SECURITIES WHICH HAVE BEEN REQUESTED TO
BE INCLUDED IN SUCH REGISTRATION BY PERSONS ENTITLED TO EXERCISE “PIGGY-BACK”
REGISTRATION RIGHTS PURSUANT TO CONTRACTUAL COMMITMENTS OF THE COMPANY (PRO RATA
BASED ON THE AMOUNT OF SECURITIES SOUGHT TO BE REGISTERED BY HOLDERS AND SUCH
OTHER PERSONS); AND (Y) IN CASES NOT INITIALLY INVOLVING THE REGISTRATION FOR
SALE OF SECURITIES FOR THE COMPANY’S OWN ACCOUNT, SECURITIES SHALL BE REGISTERED
IN SUCH OFFERING IN THE FOLLOWING ORDER OF PRIORITY: (I) FIRST, THE SECURITIES
OF ANY PERSON WHOSE EXERCISE OF A “DEMAND” REGISTRATION RIGHT PURSUANT TO A
CONTRACTUAL COMMITMENT OF THE COMPANY IS THE BASIS FOR THE REGISTRATION,
(II) SECOND, REGISTRABLE SECURITIES AND SECURITIES WHICH HAVE BEEN REQUESTED TO
BE INCLUDED IN SUCH REGISTRATION BY PERSONS ENTITLED TO EXERCISE “PIGGY-BACK”
REGISTRATION RIGHTS PURSUANT TO CONTRACTUAL COMMITMENTS OF THE COMPANY (PRO RATA
BASED ON THE AMOUNT OF SECURITIES SOUGHT TO BE REGISTERED BY HOLDERS AND SUCH
OTHER PERSONS), AND (III) THIRD, THE SECURITIES WHICH THE COMPANY PROPOSES TO
REGISTER.

 

(E)       IF, AS A RESULT OF THE PRORATION PROVISIONS OF THIS SECTION 2.3, ANY
HOLDER SHALL NOT BE ENTITLED TO INCLUDE ALL REGISTRABLE SECURITIES IN A
PIGGYBACK REGISTRATION THAT SUCH HOLDER HAS REQUESTED TO BE INCLUDED, SUCH
HOLDER MAY ELECT TO WITHDRAW HIS REQUEST TO INCLUDE REGISTRABLE SECURITIES IN
SUCH REGISTRATION.

 

(F)         THE RIGHT OF THE HOLDERS TO REGISTER REGISTRABLE SECURITIES PURSUANT
TO THIS SECTION 2.3 IS ONLY EXERCISABLE WITH RESPECT TO REGISTRABLE SECURITIES
NOT THEN COVERED BY AN EFFECTIVE REGISTRATION STATEMENT.

 

2.4                                 UNDERWRITING; HOLDBACK AGREEMENTS.

 

(A)       IN THE EVENT THAT ONE OR MORE HOLDERS ELECT TO DISPOSE OF REGISTRABLE
SECURITIES UNDER A REGISTRATION STATEMENT PURSUANT TO AN UNDERWRITTEN OFFERING
OR A REQUESTED REGISTRATION PURSUANT TO SECTION 2.2 INVOLVES AN UNDERWRITTEN
OFFERING, THE MANAGING UNDERWRITER OR UNDERWRITERS SHALL BE SELECTED BY THE
HOLDERS OF A MAJORITY (BY NUMBER OF SHARES OWNED) OF THE REGISTRABLE SECURITIES
TO BE SOLD IN THE UNDERWRITTEN OFFERING OR REQUESTED TO BE INCLUDED IN SUCH
REGISTRATION STATEMENT AND SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.  IN
CONNECTION WITH ANY SUCH UNDERWRITTEN OFFERING, THE COMPANY SHALL TAKE ALL SUCH
REASONABLE ACTIONS AS ARE REQUIRED BY THE MANAGING UNDERWRITERS IN ORDER TO
EXPEDITE AND FACILITATE THE REGISTRATION AND DISPOSITION OF THE REGISTRABLE
SECURITIES, INCLUDING THE COMPANY CAUSING APPROPRIATE EXECUTIVE OFFICERS OF THE
COMPANY OR ITS AFFILIATES TO PARTICIPATE IN A “ROAD SHOW” OR SIMILAR MARKETING
EFFORT BEING CONDUCTED BY SUCH MANAGING UNDERWRITERS WITH RESPECT TO SUCH
UNDERWRITTEN OFFERING.

 

(B)      ALL HOLDERS PROPOSING TO DISTRIBUTE THEIR REGISTRABLE SECURITIES
THROUGH AN UNDERWRITTEN OFFERING SHALL ENTER INTO AN UNDERWRITING AGREEMENT IN
CUSTOMARY FORM WITH THE MANAGING UNDERWRITERS SELECTED FOR SUCH UNDERWRITTEN
OFFERING.

 

(C)       TO THE EXTENT NOT INCONSISTENT WITH APPLICABLE LAW, IN CONNECTION WITH
A PUBLIC OFFERING OF SECURITIES OF THE COMPANY, UPON THE REQUEST OF THE COMPANY
OR, IN THE CASE OF AN UNDERWRITTEN PUBLIC OFFERING OF THE COMPANY’S SECURITIES,
THE MANAGING UNDERWRITERS, EACH HOLDER WHO BENEFICIALLY OWNS (AS DEFINED IN
RULE 13D-3 ADOPTED BY THE SEC UNDER THE EXCHANGE

 

7

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ACT) AT LEAST 5% OF THE OUTSTANDING CAPITAL STOCK OF THE COMPANY WILL NOT EFFECT
ANY SALE OR DISTRIBUTION (OTHER THAN THOSE INCLUDED IN THE REGISTRATION
STATEMENT BEING FILED WITH RESPECT TO SUCH PUBLIC OFFERING) OF, OR ANY SHORT
SALE OF, OR ANY GRANT OF OPTION TO PURCHASE, OR ANY HEDGING OR SIMILAR
TRANSACTION WITH RESPECT TO, ANY SECURITIES OF THE COMPANY, OR ANY SECURITIES,
OPTIONS OR RIGHTS CONVERTIBLE INTO OR EXCHANGEABLE OR EXERCISABLE FOR SUCH
SECURITIES DURING THE 14 DAYS PRIOR TO AND THE 90-DAY PERIOD BEGINNING ON THE
EFFECTIVE DATE OF SUCH PUBLIC OFFERING, UNLESS THE COMPANY, OR IN THE CASE OF AN
UNDERWRITTEN PUBLIC OFFERING, THE MANAGING UNDERWRITERS OTHERWISE AGREE TO A
SHORTER PERIOD OF TIME.  AT THE REQUEST OF THE COMPANY OR THE MANAGING
UNDERWRITERS, EACH SUCH HOLDER SHALL EXECUTE A CUSTOMARY “LOCK-UP” AGREEMENT
CONSISTENT WITH THE PROVISIONS OF THIS SECTION 2.4; PROVIDED, HOWEVER, THAT NO
HOLDER SHALL BE REQUIRED TO ENTER INTO ANY SUCH “LOCK UP” AGREEMENT UNLESS AND
UNTIL ALL OF THE COMPANY’S EXECUTIVE OFFICERS AND DIRECTORS EXECUTE
SUBSTANTIALLY SIMILAR “LOCK UP” AGREEMENTS AND THE COMPANY USES COMMERCIALLY
REASONABLE EFFORTS TO CAUSE EACH HOLDER OF MORE THAN 5% OF ITS OUTSTANDING
CAPITAL STOCK TO EXECUTE SUBSTANTIALLY SIMILAR “LOCK UP” AGREEMENTS.  NEITHER
THE COMPANY NOR THE UNDERWRITER SHALL TERMINATE, MATERIALLY AMEND OR WAIVE THE
ENFORCEMENT OF ANY MATERIAL PROVISION UNDER A “LOCK UP” AGREEMENT UNLESS EACH
“LOCK UP” AGREEMENT WITH A HOLDER IS ALSO AMENDED OR WAIVED IN A SIMILAR MANNER
OR TERMINATED, AS THE CASE MAY BE.  THE COMPANY MAY IMPOSE STOP-TRANSFER
INSTRUCTIONS TO ENFORCE THE RESTRICTIONS IMPOSED BY THIS SECTION 2.4.

 

2.5                                 REGISTRATION PROCEDURES.  THE COMPANY WILL
USE ITS REASONABLE BEST EFFORTS TO EFFECT THE REGISTRATION OF REGISTRABLE
SECURITIES PURSUANT TO THIS AGREEMENT IN ACCORDANCE WITH THE INTENDED METHODS OF
DISPOSITION THEREOF, AND PURSUANT THERETO THE COMPANY WILL AS EXPEDITIOUSLY AS
POSSIBLE:

 

(A)       BEFORE FILING THE REGISTRATION STATEMENT OR ANY AMENDMENT OR
SUPPLEMENT THERETO, THE COMPANY WILL FURNISH TO ANY COUNSEL SELECTED BY THE
HOLDERS OF A MAJORITY OF THE REGISTRABLE SECURITIES A COPY OF SUCH REGISTRATION
STATEMENT, AMENDMENT OR SUPPLEMENT AND ALLOW SUCH COUNSEL REASONABLE TIME TO
REVIEW AND COMMENT ON SUCH REGISTRATION STATEMENT, AMENDMENT OR SUPPLEMENT PRIOR
TO THE FILING THEREOF AND WILL PROVIDE SUCH COUNSEL WITH ALL WRITTEN
CORRESPONDENCE WITH THE SEC REGARDING SUCH REGISTRATION STATEMENT, AMENDMENT OR
SUPPLEMENT;

 

(B)      PREPARE AND FILE WITH THE SEC THE REGISTRATION STATEMENT, AND SUCH
AMENDMENTS AND SUPPLEMENTS TO SUCH REGISTRATION STATEMENT AND THE PROSPECTUS
USED IN CONNECTION THEREWITH AS MAY BE NECESSARY TO KEEP SUCH REGISTRATION
STATEMENT EFFECTIVE FOR THE PERIODS PROVIDED FOR IN SECTION 2.2 OR THE PERIODS
CONTEMPLATED BY THE COMPANY OR THE HOLDERS REQUESTING ANY REGISTRATION STATEMENT
FILED PURSUANT TO SECTION 2.3, AND IN COMPLIANCE WITH ALL APPLICABLE RULES AND
REGULATIONS OF THE SEC AND THE TERMS OF THIS AGREEMENT;

 

(C)       FURNISH TO EACH HOLDER SELLING SUCH REGISTRABLE SECURITIES SUCH NUMBER
OF COPIES OF SUCH REGISTRATION STATEMENT, EACH AMENDMENT AND SUPPLEMENT THERETO,
THE PROSPECTUS INCLUDED IN THE REGISTRATION STATEMENT (INCLUDING EACH
PRELIMINARY PROSPECTUS) AND SUCH OTHER DOCUMENTS AS SUCH SELLER MAY REASONABLY
REQUEST IN ORDER TO FACILITATE THE DISPOSITION OF THE REGISTRABLE SECURITIES
OWNED BY SUCH HOLDER;

 

(D)      USE ITS REASONABLE BEST EFFORTS TO REGISTER OR QUALIFY SUCH REGISTRABLE
SECURITIES UNDER SUCH OTHER STATE SECURITIES OR “BLUE SKY” LAWS AS THE SELLING
HOLDERS SELLING SUCH

 

8

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REGISTRABLE SECURITIES REASONABLY REQUESTS AND DO ANY AND ALL OTHER ACTS AND
THINGS WHICH MAY BE REASONABLY NECESSARY OR REASONABLY ADVISABLE TO ENABLE SUCH
HOLDER TO CONSUMMATE THE DISPOSITION IN SUCH JURISDICTIONS OF THE REGISTRABLE
SECURITIES OWNED BY SUCH HOLDER AND TO KEEP EACH SUCH REGISTRATION OR
QUALIFICATION (OR EXEMPTION THEREFROM) EFFECTIVE DURING THE PERIOD WHICH THE
REGISTRATION STATEMENT IS REQUIRED TO BE KEPT EFFECTIVE (PROVIDED, THAT THE
COMPANY WILL NOT BE REQUIRED TO (I) QUALIFY GENERALLY TO DO BUSINESS IN ANY
JURISDICTION WHERE IT WOULD NOT OTHERWISE BE REQUIRED TO QUALIFY BUT FOR THIS
SUBPARAGRAPH, (II) SUBJECT ITSELF TO TAXATION IN ANY SUCH JURISDICTION OR
(III) CONSENT TO GENERAL SERVICE OF PROCESS IN ANY SUCH JURISDICTION);

 

(E)       NOTIFY EACH HOLDER SELLING SUCH REGISTRABLE SECURITIES, AT ANY TIME
WHEN A PROSPECTUS RELATING THERETO IS REQUIRED TO BE DELIVERED UNDER THE
SECURITIES ACT, OF THE HAPPENING OF ANY EVENT AS A RESULT OF WHICH THE
PROSPECTUS INCLUDED IN THE REGISTRATION STATEMENT CONTAINS AN UNTRUE STATEMENT
OF A MATERIAL FACT OR OMITS ANY FACT NECESSARY TO MAKE THE STATEMENTS THEREIN
NOT MISLEADING IN THE LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE,
AND, AT THE REQUEST OF ANY SUCH HOLDER, THE COMPANY WILL AS SOON AS POSSIBLE
PREPARE AND FURNISH TO SUCH HOLDER A REASONABLE NUMBER OF COPIES OF A SUPPLEMENT
OR AMENDMENT TO SUCH PROSPECTUS SO THAT, AS THEREAFTER DELIVERED TO THE
PURCHASERS OF SUCH REGISTRABLE SECURITIES, SUCH PROSPECTUS WILL NOT CONTAIN AN
UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO STATE ANY FACT NECESSARY TO MAKE
THE STATEMENTS THEREIN NOT MISLEADING IN THE LIGHT OF THE CIRCUMSTANCES UNDER
WHICH THEY WERE MADE;

 

(F)         CAUSE ALL SUCH REGISTRABLE SECURITIES TO BE LISTED OR QUOTED ON EACH
SECURITIES EXCHANGE OR QUOTATION SERVICE ON WHICH SIMILAR SECURITIES ISSUED BY
THE COMPANY ARE THEN LISTED OR QUOTED AND, IF NOT SO LISTED, TO BE APPROVED FOR
TRADING ON ANY AUTOMATED QUOTATION SYSTEM OF A NATIONAL SECURITIES ASSOCIATION
ON WHICH SIMILAR SECURITIES OF THE COMPANY ARE QUOTED;

 

(G)      PROVIDE A TRANSFER AGENT AND REGISTRAR FOR ALL SUCH REGISTRABLE
SECURITIES NOT LATER THAN THE EFFECTIVE DATE OF SUCH REGISTRATION STATEMENT;

 

(H)      ENTER INTO SUCH CUSTOMARY AGREEMENTS (INCLUDING UNDERWRITING AGREEMENTS
CONTAINING CUSTOMARY REPRESENTATIONS AND WARRANTIES) AND TAKE ALL OTHER
CUSTOMARY AND APPROPRIATE ACTIONS AS THE HOLDERS OF A MAJORITY OF THE
REGISTRABLE SECURITIES BEING SOLD OR THE MANAGING UNDERWRITERS, IF ANY,
REASONABLY REQUEST IN ORDER TO EXPEDITE OR FACILITATE THE DISPOSITION OF SUCH
REGISTRABLE SECURITIES;

 

(I)          NOTIFY EACH HOLDER OF ANY STOP ORDER ISSUED OR THREATENED BY THE
SEC;

 

(J)          OTHERWISE COMPLY WITH ALL APPLICABLE RULES AND REGULATIONS OF THE
SEC, AND MAKE AVAILABLE TO ITS SECURITY HOLDERS, AS SOON AS REASONABLY
PRACTICABLE, AN EARNINGS STATEMENT COVERING THE PERIOD OF AT LEAST TWELVE MONTHS
BEGINNING WITH THE FIRST DAY OF THE COMPANY’S FIRST FULL CALENDAR QUARTER AFTER
THE EFFECTIVE DATE OF THE REGISTRATION STATEMENT, WHICH EARNINGS STATEMENT SHALL
SATISFY THE PROVISIONS OF SECTION 11(A) OF THE SECURITIES ACT AND RULE 158
THEREUNDER;

 

(K)       IN THE EVENT OF THE ISSUANCE OF ANY STOP ORDER SUSPENDING THE
EFFECTIVENESS OF A REGISTRATION STATEMENT, OR OF ANY ORDER SUSPENDING OR
PREVENTING THE USE OF ANY RELATED PROSPECTUS OR SUSPENDING THE QUALIFICATION OF
ANY SECURITIES INCLUDED IN SUCH REGISTRATION

 

9

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STATEMENT FOR SALE IN ANY JURISDICTION, THE COMPANY WILL USE ITS REASONABLE BEST
EFFORTS TO PROMPTLY OBTAIN THE WITHDRAWAL OF SUCH ORDER;

 

(L)          WITH RESPECT TO AN UNDERWRITTEN OFFERING PURSUANT TO ANY
REGISTRATION STATEMENT FILED UNDER SECTION 2.2, OBTAIN ONE OR MORE COMFORT
LETTERS, DATED THE EFFECTIVE DATE OF THE REGISTRATION STATEMENT AND, IF REQUIRED
BY THE MANAGING UNDERWRITERS, DATED THE DATE OF THE CLOSING UNDER THE
UNDERWRITING AGREEMENT, SIGNED BY THE COMPANY’S INDEPENDENT PUBLIC ACCOUNTANTS
IN CUSTOMARY FORM AND COVERING SUCH MATTER OF THE TYPE CUSTOMARILY COVERED BY
COMFORT LETTERS IN SIMILAR TRANSACTIONS;

 

(M)    WITH RESPECT TO AN UNDERWRITTEN OFFERING PURSUANT TO ANY REGISTRATION
STATEMENT FILED UNDER SECTION 2.2, OBTAIN A LEGAL OPINION OF THE COMPANY’S
OUTSIDE COUNSEL, DATED THE EFFECTIVE DATE OF SUCH REGISTRATION STATEMENT AND, IF
REQUIRED BY THE MANAGING UNDERWRITERS, DATED THE DATE OF THE CLOSING UNDER THE
UNDERWRITING AGREEMENT, WITH RESPECT TO THE REGISTRATION STATEMENT, EACH
AMENDMENT AND SUPPLEMENT THERETO, THE PROSPECTUS INCLUDED THEREIN (INCLUDING THE
PRELIMINARY PROSPECTUS) AND SUCH OTHER DOCUMENTS RELATING THERETO IN CUSTOMARY
FORM AND COVERING SUCH MATTERS OF THE TYPE CUSTOMARILY COVERED BY LEGAL OPINIONS
IN SIMILAR TRANSACTIONS;

 

(N)      SUBJECT TO EXECUTION AND DELIVERY OF MUTUALLY SATISFACTORY
CONFIDENTIALITY AGREEMENTS, MAKE AVAILABLE AT REASONABLE TIMES FOR INSPECTION BY
EACH HOLDER SELLING SUCH REGISTRABLE SECURITIES, ANY MANAGING UNDERWRITER
PARTICIPATING IN ANY DISPOSITION OF SUCH REGISTRABLE SECURITIES PURSUANT TO THE
REGISTRATION STATEMENT, AND ANY ATTORNEY, ACCOUNTANT OR OTHER AGENT RETAINED BY
SUCH HOLDER OR ANY SUCH MANAGING UNDERWRITER, DURING NORMAL BUSINESS HOURS OF
THE COMPANY AT THE COMPANY’S CORPORATE OFFICE IN MANITOWOC, WISCONSIN AND
WITHOUT UNREASONABLE DISRUPTION OF THE COMPANY’S BUSINESS OR UNREASONABLE
EXPENSE TO COMPANY AND SOLELY FOR THE PURPOSE OF DUE DILIGENCE WITH RESPECT TO
THE REGISTRATION STATEMENT, LEGALLY DISCLOSABLE, FINANCIAL AND OTHER RECORDS AND
PERTINENT CORPORATE DOCUMENTS OF THE COMPANY AND ITS SUBSIDIARIES REASONABLE
REQUESTED BY SUCH PERSONS, AND CAUSE THE COMPANY’S EMPLOYEES TO, AND REQUEST ITS
INDEPENDENT ACCOUNTANTS TO, SUPPLY ALL SIMILAR INFORMATION REASONABLY REQUESTED
BY ANY SUCH PERSON, AS SHALL BE REASONABLY NECESSARY TO ENABLE THEM TO EXERCISE
THEIR DUE DILIGENCE RESPONSIBILITY;

 

(O)      COOPERATE WITH EACH SELLER OF REGISTRABLE SECURITIES AND EACH
UNDERWRITER PARTICIPATING IN THE DISPOSITION OF SUCH REGISTRABLE SECURITIES AND
THEIR RESPECTIVE COUNSEL IN CONNECTION WITH ANY FILINGS REQUIRED TO BE MADE WITH
THE OTC BULLETIN BOARD OR FINRA; AND

 

(P)      TAKE ALL OTHER STEPS REASONABLY NECESSARY TO EFFECT THE REGISTRATION OF
THE REGISTRABLE SECURITIES CONTEMPLATED HEREBY.

 

2.6                                 CONDITIONS PRECEDENT TO COMPANY’S
OBLIGATIONS PURSUANT TO THIS AGREEMENT.  IT SHALL BE A CONDITION PRECEDENT TO
THE OBLIGATIONS OF THE COMPANY TO TAKE ANY ACTION PURSUANT TO THIS ARTICLE 2
WITH RESPECT TO THE REGISTRABLE SECURITIES OF ANY HOLDER THAT SUCH HOLDER SHALL
TIMELY FURNISH TO THE COMPANY SUCH INFORMATION REGARDING ITSELF, THE REGISTRABLE
SECURITIES HELD BY IT AND THE INTENDED METHOD OF DISTRIBUTION OF SUCH SECURITIES
AS SHALL REASONABLY BE REQUIRED TO EFFECT THE REGISTRATION OF SUCH HOLDER’S
REGISTRABLE SECURITIES.

 

10

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2.7                                 FEES AND EXPENSES.  ALL EXPENSES INCIDENT TO
THE COMPANY’S PERFORMANCE OF OR COMPLIANCE WITH THIS AGREEMENT INCLUDING,
WITHOUT LIMITATION, ALL REGISTRATION AND FILING FEES PAYABLE BY THE COMPANY,
FEES AND EXPENSES OF COMPLIANCE BY THE COMPANY WITH SECURITIES OR BLUE SKY LAWS,
PRINTING EXPENSES OF THE COMPANY, MESSENGER AND DELIVERY EXPENSES OF THE
COMPANY, AND FEES AND DISBURSEMENTS OF COUNSEL FOR THE COMPANY AND ALL
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS OF THE COMPANY, AND OTHER PERSONS
RETAINED BY THE COMPANY WILL BE BORNE BY THE COMPANY, AND THE COMPANY WILL PAY
ITS INTERNAL EXPENSES (INCLUDING, WITHOUT LIMITATION, ALL SALARIES AND EXPENSES
OF THE COMPANY’S EMPLOYEES PERFORMING LEGAL OR ACCOUNTING DUTIES), THE EXPENSE
OF ANY ANNUAL AUDIT OR QUARTERLY REVIEW, THE EXPENSE OF ANY LIABILITY INSURANCE
OF THE COMPANY AND THE EXPENSES AND FEES FOR LISTING OR APPROVAL FOR TRADING OF
THE SECURITIES TO BE REGISTERED ON EACH SECURITIES EXCHANGE ON WHICH SIMILAR
SECURITIES ISSUED BY THE COMPANY ARE THEN LISTED OR ON ANY AUTOMATED QUOTATION
SYSTEM OF A NATIONAL SECURITIES ASSOCIATION OR OTHER QUOTATION SYSTEM ON WHICH
SIMILAR SECURITIES OF THE COMPANY ARE QUOTED.  IN CONNECTION WITH ANY
REGISTRATION STATEMENT FILED HEREUNDER, THE COMPANY WILL PAY THE REASONABLE FEES
AND EXPENSES OF A SINGLE COUNSEL RETAINED BY THE HOLDERS OF A MAJORITY (BY
NUMBER OF SHARES) OF THE REGISTRABLE SECURITIES REQUESTED TO BE INCLUDED IN SUCH
REGISTRATION STATEMENT.  THE COMPANY SHALL HAVE NO OBLIGATION TO PAY ANY
UNDERWRITING DISCOUNTS OR COMMISSIONS ATTRIBUTABLE TO THE SALE OF REGISTRABLE
SECURITIES AND ANY OF THE EXPENSES INCURRED BY ANY HOLDER WHICH ARE NOT PAYABLE
BY THE COMPANY, SUCH COSTS TO BE BORNE BY SUCH HOLDER OR HOLDERS, INCLUDING,
WITHOUT LIMITATION, UNDERWRITING FEES, DISCOUNTS AND EXPENSES, IF ANY,
APPLICABLE TO ANY HOLDER’S REGISTRABLE SECURITIES; FEES AND DISBURSEMENTS OF
COUNSEL OR OTHER PROFESSIONALS THAT ANY HOLDER MAY CHOOSE TO RETAIN IN
CONNECTION WITH A REGISTRATION STATEMENT FILED PURSUANT TO THIS AGREEMENT
(EXCEPT AS OTHERWISE PROVIDED HEREIN); SELLING COMMISSIONS OR STOCK TRANSFER
TAXES APPLICABLE TO THE REGISTRABLE SECURITIES REGISTERED ON BEHALF OF ANY
HOLDER; ANY OTHER EXPENSES INCURRED BY OR ON BEHALF OF SUCH HOLDER IN CONNECTION
WITH THE OFFER AND SALE OF SUCH HOLDER’S REGISTRABLE SECURITIES OTHER THAN
EXPENSES WHICH THE COMPANY IS EXPRESSLY OBLIGATED TO PAY PURSUANT TO THIS
AGREEMENT.

 

2.8                                 INDEMNIFICATION.

 

(A)       THE COMPANY AGREES TO INDEMNIFY AND HOLD HARMLESS, TO THE FULLEST
EXTENT PERMITTED BY LAW, HOLDERS AND EACH UNDERWRITER, IF ANY, AND ANY PERSON
WHO CONTROLS SUCH UNDERWRITER (WITHIN THE MEANING OF SECTION 15 OF THE
SECURITIES ACT), FROM AND AGAINST ANY LOSS, CLAIM, DAMAGE, LIABILITY, REASONABLE
ATTORNEY’S FEES, COST OR EXPENSE AND COSTS AND EXPENSES OF INVESTIGATING AND
DEFENDING ANY SUCH CLAIM (COLLECTIVELY, THE “LOSSES”), JOINT OR SEVERAL, AND ANY
ACTION IN RESPECT THEREOF TO WHICH THE HOLDERS MAY BECOME SUBJECT UNDER THE
SECURITIES ACT OR OTHERWISE, INSOFAR AS SUCH LOSSES (OR ACTIONS OR PROCEEDINGS,
WHETHER COMMENCED OR THREATENED, IN RESPECT THERETO) ARISE OUT OF OR ARE BASED
UPON (I) ANY BREACH BY THE COMPANY OF ANY OF ITS REPRESENTATIONS, WARRANTIES OR
COVENANTS CONTAINED IN THIS AGREEMENT, (II) ANY UNTRUE OR ALLEGED UNTRUE
STATEMENT OF A MATERIAL FACT CONTAINED IN ANY REGISTRATION STATEMENT, PROSPECTUS
OR PRELIMINARY OR SUMMARY PROSPECTUS OR ANY AMENDMENT OR SUPPLEMENT THERETO OR
(III) ANY OMISSION OR ALLEGED OMISSION TO STATE THEREIN A MATERIAL FACT REQUIRED
TO BE STATED THEREIN OR NECESSARY TO MAKE THE STATEMENTS THEREIN NOT MISLEADING,
AND THE COMPANY SHALL REIMBURSE THE HOLDERS FOR ANY REASONABLE LEGAL OR ANY
OTHER EXPENSES ACTUALLY INCURRED BY THEM IN CONNECTION WITH INVESTIGATING OR
DEFENDING OR PREPARING TO DEFEND AGAINST ANY SUCH LOSS, ACTION OR PROCEEDING;
PROVIDED, HOWEVER, THAT THE COMPANY SHALL NOT BE LIABLE TO THE HOLDERS OR OTHER
INDEMNITEE IN ANY SUCH CASE TO THE EXTENT THAT ANY SUCH LOSS (OR ACTION OR
PROCEEDING, WHETHER

 

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COMMENCED OR THREATENED, IN RESPECT THEREOF) ARISES OUT OF OR IS BASED UPON
(X) AN UNTRUE STATEMENT OR ALLEGED UNTRUE STATEMENT OR OMISSION OR ALLEGED
OMISSION, MADE IN SUCH REGISTRATION STATEMENT, ANY SUCH PROSPECTUS OR
PRELIMINARY OR SUMMARY PROSPECTUS OR ANY AMENDMENT OR SUPPLEMENT THERETO, IN
RELIANCE UPON, AND IN CONFORMITY WITH, WRITTEN INFORMATION PREPARED AND
FURNISHED TO THE COMPANY BY ANY HOLDER EXPRESSLY FOR USE THEREIN AND, WITH
RESPECT TO ANY UNTRUE STATEMENT OR OMISSION OR ALLEGED UNTRUE STATEMENT OR
OMISSION MADE IN ANY PRELIMINARY PROSPECTUS RELATING TO THE REGISTRATION
STATEMENT, TO THE EXTENT THAT A PROSPECTUS RELATING TO THE REGISTRABLE
SECURITIES WAS REQUIRED TO BE DELIVERED BY SUCH HOLDER UNDER THE SECURITIES ACT
IN CONNECTION WITH SUCH PURCHASE, THERE WAS NOT SENT OR GIVEN TO SUCH PERSON, AT
OR PRIOR TO THE WRITTEN CONFIRMATION OF THE SALE OF SUCH REGISTRABLE SECURITIES
TO SUCH PERSON, A COPY OF THE FINAL PROSPECTUS THAT CORRECTS SUCH UNTRUE
STATEMENT OR ALLEGED UNTRUE STATEMENT OR OMISSION OR ALLEGED OMISSION IF THE
COMPANY HAD PREVIOUSLY FURNISHED COPIES THEREOF TO SUCH HOLDER OR (Y) USE OF A
REGISTRATION STATEMENT OR THE RELATED PROSPECTUS DURING A PERIOD WHEN A STOP
ORDER HAS BEEN ISSUED IN RESPECT OF SUCH REGISTRATION STATEMENT OR ANY
PROCEEDINGS FOR THAT PURPOSE HAVE BEEN INITIATED OR USE OF A PROSPECTUS WHEN USE
OF SUCH PROSPECTUS HAS BEEN SUSPENDED PURSUANT TO SECTIONS 2.5(E) OR (I);
PROVIDED THAT IN EACH CASE, THAT SUCH HOLDER RECEIVED PRIOR WRITTEN NOTICE OF
SUCH STOP ORDER, INITIATION OF PROCEEDINGS OR SUSPENSION FROM THE COMPANY.   IN
NO EVENT, HOWEVER, SHALL THE COMPANY BE LIABLE FOR INDIRECT, INCIDENTAL OR
CONSEQUENTIAL OR SPECIAL DAMAGES OF ANY KIND.

 

(B)      IN CONNECTION WITH THE FILING OF THE REGISTRATION STATEMENT BY THE
COMPANY PURSUANT TO THIS AGREEMENT, THE HOLDERS WILL FURNISH TO THE COMPANY IN
WRITING SUCH INFORMATION AS THE COMPANY REASONABLY REQUESTS FOR USE IN
CONNECTION WITH SUCH REGISTRATION STATEMENT AND THE RELATED PROSPECTUS AND, TO
THE FULLEST EXTENT PERMITTED BY LAW, THE HOLDERS WILL INDEMNIFY AND HOLD
HARMLESS THE COMPANY AND ITS OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS, AND EACH
UNDERWRITER, IF ANY, AND ANY PERSON WHO CONTROLS SUCH UNDERWRITER (WITHIN THE
MEANING OF SECTION 15 OF THE SECURITIES ACT), FROM AND AGAINST ANY LOSSES,
SEVERALLY BUT NOT JOINTLY, AND ANY ACTION IN RESPECT THEREOF TO WHICH THE
COMPANY OR ITS OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS, MAY BECOME SUBJECT
UNDER THE SECURITIES ACT OR OTHERWISE, INSOFAR AS SUCH LOSSES (OR ACTIONS OR
PROCEEDINGS, WHETHER COMMENCED OR THREATENED, IN RESPECT THEREOF) ARISE OUT OF
OR ARE BASED UPON (I) THE PURCHASE OR SALE OF REGISTRABLE SECURITIES DURING A
SUSPENSION AS SET FORTH IN SECTION 2.5(E) OR SECTION 2.5(I) IN EACH CASE AFTER
RECEIPT OF WRITTEN NOTICE OF SUCH SUSPENSION, (II) ANY UNTRUE OR ALLEGED UNTRUE
STATEMENT OF A MATERIAL FACT CONTAINED IN THE REGISTRATION STATEMENT, PROSPECTUS
OR PRELIMINARY OR SUMMARY PROSPECTUS OR ANY AMENDMENT OR SUPPLEMENT THERETO, OR
(III) ANY OMISSION OR ALLEGED OMISSION OF A MATERIAL FACT REQUIRED TO BE STATED
THEREIN OR NECESSARY TO MAKE THE STATEMENTS THEREIN NOT MISLEADING, BUT, WITH
RESPECT TO CLAUSES (II) AND (III) ABOVE, ONLY TO THE EXTENT THAT SUCH UNTRUE
STATEMENT OR OMISSION IS MADE IN SUCH REGISTRATION STATEMENT, ANY SUCH
PROSPECTUS OR PRELIMINARY OR SUMMARY PROSPECTUS OR ANY AMENDMENT OR SUPPLEMENT
THERETO, IN RELIANCE UPON AND IN CONFORMITY WITH WRITTEN INFORMATION PREPARED
AND FURNISHED TO THE COMPANY BY SUCH HOLDER EXPRESSLY FOR USE THEREIN OR BY
FAILURE OF SUCH HOLDER TO DELIVER A COPY OF THE REGISTRATION STATEMENT OR
PROSPECTUS OR ANY AMENDMENTS OR SUPPLEMENTS THERETO, AND SUCH HOLDER WILL
REIMBURSE THE COMPANY FOR ANY REASONABLE LEGAL OR ANY OTHER EXPENSES INCURRED BY
THEM IN CONNECTION WITH INVESTIGATING OR DEFENDING OR PREPARING TO DEFEND
AGAINST ANY SUCH LOSS, ACTION OR PROCEEDING; PROVIDED, HOWEVER, THAT SUCH HOLDER
SHALL NOT BE LIABLE IN ANY SUCH CASE TO THE EXTENT THAT PRIOR TO THE FILING OF
ANY SUCH REGISTRATION STATEMENT OR PROSPECTUS OR AMENDMENT OR SUPPLEMENT
THERETO, SUCH HOLDER HAS FURNISHED IN WRITING TO THE COMPANY INFORMATION
EXPRESSLY FOR USE IN SUCH REGISTRATION STATEMENT OR PROSPECTUS OR ANY AMENDMENT
OR SUPPLEMENT

 

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THERETO WHICH CORRECTED OR MADE NOT MISLEADING INFORMATION PREVIOUSLY FURNISHED
TO THE COMPANY.  THE OBLIGATION OF EACH HOLDER TO INDEMNIFY THE COMPANY AND ITS
OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS,  SHALL BE LIMITED TO THE NET PROCEEDS
RECEIVED BY SUCH HOLDER FROM THE SALE OF REGISTRABLE SECURITIES UNDER SUCH
REGISTRATION STATEMENT.  IN NO EVENT, HOWEVER, SHALL ANY HOLDER BE LIABLE FOR
INDIRECT, INCIDENTAL OR CONSEQUENTIAL OR SPECIAL DAMAGES OF ANY KIND.

 

(C)       PROMPTLY AFTER RECEIPT BY ANY PERSON IN RESPECT OF WHICH INDEMNITY MAY
BE SOUGHT PURSUANT TO SECTION 2.8(A) OR 2.8(B) (AN “INDEMNIFIED PARTY”) OF
NOTICE OF ANY CLAIM OR THE COMMENCEMENT OF ANY ACTION, THE INDEMNIFIED PARTY
SHALL, IF A CLAIM IN RESPECT THEREOF IS TO BE MADE AGAINST THE PERSON AGAINST
WHOM SUCH INDEMNITY MAY BE SOUGHT (AN “INDEMNIFYING PARTY”), PROMPTLY NOTIFY THE
INDEMNIFYING PARTY IN WRITING OF THE CLAIM OR THE COMMENCEMENT OF SUCH ACTION;
PROVIDED, THAT THE FAILURE TO NOTIFY THE INDEMNIFYING PARTY SHALL NOT RELIEVE
THE INDEMNIFYING PARTY FROM ANY LIABILITY WHICH IT MAY HAVE TO AN INDEMNIFIED
PARTY UNDER SECTION 2.8(A) OR 2.8(B) EXCEPT TO THE EXTENT OF ANY ACTUAL
PREJUDICE RESULTING THEREFROM.  IF ANY SUCH CLAIM OR ACTION SHALL BE BROUGHT
AGAINST AN INDEMNIFIED PARTY, AND IT SHALL NOTIFY THE INDEMNIFYING PARTY
THEREOF, THE INDEMNIFYING PARTY SHALL BE ENTITLED TO PARTICIPATE THEREIN, AND,
TO THE EXTENT THAT IT WISHES, JOINTLY WITH ANY OTHER SIMILARLY NOTIFIED
INDEMNIFYING PARTY, TO ASSUME THE DEFENSE THEREOF WITH COUNSEL REASONABLY
SATISFACTORY TO THE INDEMNIFIED PARTY. AFTER NOTICE FROM THE INDEMNIFYING PARTY
TO THE INDEMNIFIED PARTY OF ITS ELECTION TO ASSUME THE DEFENSE OF SUCH CLAIM OR
ACTION, THE INDEMNIFYING PARTY SHALL NOT BE LIABLE TO THE INDEMNIFIED PARTY FOR
ANY LEGAL OR OTHER EXPENSES SUBSEQUENTLY INCURRED BY THE INDEMNIFIED PARTY IN
CONNECTION WITH THE DEFENSE THEREOF OTHER THAN REASONABLE COSTS OF
INVESTIGATION; PROVIDED, THAT THE INDEMNIFIED PARTY SHALL HAVE THE RIGHT TO
EMPLOY SEPARATE COUNSEL TO REPRESENT THE INDEMNIFIED PARTY WHO MAY BE SUBJECT TO
LIABILITY ARISING OUT OF ANY CLAIM IN RESPECT OF WHICH INDEMNITY MAY BE SOUGHT
BY THE INDEMNIFIED PARTY AGAINST THE INDEMNIFYING PARTY, BUT THE FEES AND
EXPENSES OF SUCH COUNSEL SHALL BE FOR THE ACCOUNT OF SUCH INDEMNIFIED PARTY
UNLESS (I) THE INDEMNIFYING PARTY AND THE INDEMNIFIED PARTY SHALL HAVE MUTUALLY
AGREED TO THE RETENTION OF SUCH COUNSEL OR (II) IN THE WRITTEN OPINION OF
COUNSEL TO SUCH INDEMNIFIED PARTY, REPRESENTATION OF BOTH PARTIES BY THE SAME
COUNSEL WOULD BE INAPPROPRIATE DUE TO ACTUAL OR POTENTIAL CONFLICTS OF INTEREST
BETWEEN THEM, IT BEING UNDERSTOOD, HOWEVER, THAT THE INDEMNIFYING PARTY SHALL
NOT, IN CONNECTION WITH ANY ONE SUCH CLAIM OR ACTION OR SEPARATE BUT
SUBSTANTIALLY SIMILAR OR RELATED CLAIMS OR ACTIONS IN THE SAME JURISDICTION
ARISING OUT OF THE SAME GENERAL ALLEGATIONS OR CIRCUMSTANCES, BE LIABLE FOR THE
FEES AND EXPENSES OF MORE THAN ONE SEPARATE FIRM OF ATTORNEYS (TOGETHER WITH
APPROPRIATE LOCAL COUNSEL) AT ANY TIME FOR ALL INDEMNIFIED PARTIES.  NO
INDEMNIFYING PARTY SHALL, WITHOUT THE PRIOR WRITTEN CONSENT OF THE INDEMNIFIED
PARTY, EFFECT ANY SETTLEMENT OF ANY CLAIM OR PENDING OR THREATENED PROCEEDING IN
RESPECT OF WHICH THE INDEMNIFIED PARTY IS OR COULD HAVE BEEN A PARTY AND
INDEMNITY COULD HAVE BEEN SOUGHT HEREUNDER BY SUCH INDEMNIFIED PARTY, UNLESS
SUCH SETTLEMENT INCLUDES AN UNCONDITIONAL RELEASE OF SUCH INDEMNIFIED PARTY FROM
ALL LIABILITY ARISING OUT OF SUCH CLAIM OR PROCEEDING OTHER THAN THE PAYMENT OF
MONETARY DAMAGES BY THE INDEMNIFYING PARTY ON BEHALF OF THE INDEMNIFIED PARTY. 
WHETHER OR NOT THE DEFENSE OF ANY CLAIM OR ACTION IS ASSUMED BY THE INDEMNIFYING
PARTY, SUCH INDEMNIFYING PARTY WILL NOT BE SUBJECT TO ANY LIABILITY FOR ANY
SETTLEMENT MADE WITHOUT ITS WRITTEN CONSENT, WHICH CONSENT WILL NOT BE
UNREASONABLY WITHHELD.

 

(D)      IF THE INDEMNIFICATION PROVIDED FOR IN THIS SECTION 2.8 IS UNAVAILABLE
TO THE INDEMNIFIED PARTIES IN RESPECT OF ANY LOSSES REFERRED TO HEREIN
NOTWITHSTANDING THAT THIS SECTION 2.8 BY ITS TERMS PROVIDES FOR INDEMNIFICATION
IN SUCH CASE, THEN EACH INDEMNIFYING PARTY,

 

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IN LIEU OF INDEMNIFYING SUCH INDEMNIFIED PARTY, SHALL CONTRIBUTE TO THE AMOUNT
PAID OR PAYABLE BY SUCH INDEMNIFIED PARTY AS A RESULT OF SUCH LOSSES IN SUCH
PROPORTION AS IS APPROPRIATE TO REFLECT THE RELATIVE BENEFITS RECEIVED BY THE
COMPANY ON THE ONE HAND AND THE HOLDERS ON THE OTHER FROM THE OFFERING OF THE
REGISTRABLE SECURITIES, OR IF SUCH ALLOCATION IS NOT PERMITTED BY APPLICABLE
LAW, IN SUCH PROPORTION AS IS APPROPRIATE TO REFLECT NOT ONLY THE RELATIVE
BENEFITS BUT ALSO THE RELATIVE FAULT OF THE COMPANY ON THE ONE HAND AND THE
HOLDERS ON THE OTHER IN CONNECTION WITH THE STATEMENTS OR OMISSIONS WHICH
RESULTED IN SUCH LOSSES, AS WELL AS ANY OTHER RELEVANT EQUITABLE CONSIDERATIONS.
THE RELATIVE FAULT OF THE COMPANY ON THE ONE HAND AND OF EACH HOLDER ON THE
OTHER SHALL BE DETERMINED BY REFERENCE TO, AMONG OTHER THINGS, WHETHER ANY
ACTION TAKEN, INCLUDING ANY UNTRUE OR ALLEGED UNTRUE STATEMENT OF A MATERIAL
FACT, OR THE OMISSION OR ALLEGED OMISSION TO STATE A MATERIAL FACT RELATES TO
INFORMATION SUPPLIED BY SUCH PARTY, AND THE PARTIES’ RELATIVE INTENT, KNOWLEDGE,
ACCESS TO INFORMATION AND OPPORTUNITY TO CORRECT OR PREVENT SUCH STATEMENT OR
OMISSION.

 

The Company and the Holders agree that it would not be just and equitable if
contribution pursuant to this Section 2.8(d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding
paragraph.  The amount paid or payable by an Indemnified Party as a result of
the Losses referred to in the immediately preceding paragraph shall be deemed to
include, subject to the limitations set forth above, any reasonable legal or
other expenses reasonably incurred by such Indemnified Party in connection with
investigating or defending any such action or claim.  Notwithstanding the
provisions of this Section 2.8, no Holder shall be required to contribute any
amount in excess of the amount by which the total price at which the Registrable
Securities of such Holder were offered to the public exceeds the amount of any
Losses which such Holder has otherwise paid by reason of such untrue or alleged
untrue statement or omission or alleged omission.   No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation.  Each Holder’s obligations to
contribute pursuant to this Section 2.8 is several in the proportion that the
proceeds of the offering received by such Holder bears to the total proceeds of
the offering received by all the Holders.  The indemnification provided by this
Section 2.8 shall be a continuing right to indemnification with respect to sales
of Registrable Securities and shall survive the registration and sale of any
Registrable Securities by any Holder and the expiration or termination of this
Agreement.  The indemnity and contribution agreements contained herein are in
addition to any liability that any Indemnifying Party might have to any
Indemnified Party.

 

2.9                                 PARTICIPATION IN REGISTRATIONS.

 

(A)       NO PERSON MAY PARTICIPATE IN ANY REGISTRATION HEREUNDER WHICH IS
UNDERWRITTEN UNLESS SUCH PERSON (I) AGREES TO SELL SUCH PERSON’S SECURITIES ON
THE BASIS PROVIDED IN ANY UNDERWRITING ARRANGEMENTS APPROVED BY THE PERSON OR
PERSONS ENTITLED HEREUNDER TO APPROVE SUCH ARRANGEMENTS AND (II) COMPLETES AND
EXECUTES ALL QUESTIONNAIRES, POWERS OF ATTORNEY, INDEMNITIES, UNDERWRITING
AGREEMENTS AND OTHER DOCUMENTS REASONABLY REQUIRED UNDER THE TERMS OF SUCH
UNDERWRITING ARRANGEMENTS AND THIS AGREEMENT.

 

(B)      EACH PERSON THAT IS PARTICIPATING IN ANY REGISTRATION UNDER THIS
AGREEMENT AGREES THAT, UPON RECEIPT OF ANY NOTICE FROM THE COMPANY OF THE
HAPPENING OF ANY EVENT OF THE

 

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KIND DESCRIBED IN SECTION 2.5(E) OR SECTION 2.5(I) ABOVE, SUCH PERSON WILL
FORTHWITH DISCONTINUE THE DISPOSITION OF ITS REGISTRABLE SECURITIES PURSUANT TO
THE REGISTRATION STATEMENT AND ALL USE OF THE REGISTRATION STATEMENT OR ANY
PROSPECTUS OR RELATED DOCUMENT UNTIL SUCH PERSON’S RECEIPT OF THE COPIES OF A
SUPPLEMENTED OR AMENDED PROSPECTUS AS CONTEMPLATED BY SUCH SECTION 2.5(E) OR
SECTION 2.5(I) AND, IF SO DIRECTED BY THE COMPANY, WILL DELIVER TO THE COMPANY
(AT THE COMPANY’S EXPENSE) ALL COPIES, OTHER THAN PERMANENT FILE COPIES, THEN IN
SUCH HOLDER’S POSSESSION OF SUCH DOCUMENTS AT THE TIME OF RECEIPT OF SUCH
NOTICE.  FURTHERMORE, EACH HOLDER AGREES THAT IF SUCH HOLDER USES A PROSPECTUS
IN CONNECTION WITH THE OFFERING AND SALE OF ANY OF THE REGISTRABLE SECURITIES,
THE HOLDER WILL USE ONLY THE LATEST VERSION OF SUCH PROSPECTUS PROVIDED BY
COMPANY.

 

(C)       NONE OF THE HOLDERS SHALL HAVE THE RIGHT TO PARTICIPATE AS A PURCHASER
OR OTHERWISE ACQUIRE ANY BENEFICIAL OWNERSHIP OF THE COMPANY’S SECURITIES IN ANY
OFFERING OF THE COMPANY’S SECURITIES, INCLUDING ANY SHAREHOLDER RIGHTS OFFERING
(I) OCCURRING WITHIN TWELVE (12) MONTHS FROM THE DATE OF THIS AGREEMENT AND
(II) IN WHICH ANY PROCEEDS FROM SUCH OFFERING ARE USED TO DIRECTLY OR INDIRECTLY
REDUCE THE COMPANY’S INDEBTEDNESS INCURRED TO FINANCE THE TRANSACTIONS
CONTEMPLATED BY THE PURCHASE AGREEMENT.

 

2.10                           COMPLIANCE.  WITH RESPECT TO ANY REGISTRATION
UNDER THIS AGREEMENT, EACH HOLDER SHALL COMPLY IN ALL MATERIAL RESPECTS WITH ALL
APPLICABLE SECURITIES AND OTHER LAWS, RULES AND REGULATIONS, INCLUDING BUT NOT
LIMITED TO ALL RULES AND REGULATIONS OF THE SEC, THE NATIONAL ASSOCIATION OF
SECURITIES DEALERS AND ANY SECURITIES EXCHANGE OR QUOTATION SERVICE ON WHICH THE
COMPANY’S SECURITIES ARE LISTED OR QUOTED.

 

ARTICLE 3
TRANSFERS OF CERTAIN RIGHTS

 

3.1                                 TRANSFER.  THE RIGHTS GRANTED TO THE
PURCHASERS UNDER THIS AGREEMENT MAY BE TRANSFERRED, SUBJECT TO THE PROVISIONS OF
SECTIONS 3.2 AND 3.3; PROVIDED THAT NOTHING CONTAINED HEREIN SHALL BE DEEMED TO
PERMIT AN ASSIGNMENT, TRANSFER OR DISPOSITION OF THE REGISTRABLE SECURITIES IN
VIOLATION OF THE TERMS AND CONDITIONS OF THE PURCHASE AGREEMENT OR APPLICABLE
LAW.

 

3.2                                 TRANSFEREES.  ANY TRANSFEREE TO WHOM RIGHTS
UNDER THIS AGREEMENT ARE TRANSFERRED SHALL, BEFORE AND AS A CONDITION TO SUCH
TRANSFER, DELIVER TO THE COMPANY A WRITTEN INSTRUMENT (I) STATING THE NAME AND
ADDRESS OF THE TRANSFEROR AND THE TRANSFEREE AND THE NUMBER OF REGISTRABLE
SECURITIES WITH RESPECT TO WHICH THE RIGHTS ARE INTENDED TO BE TRANSFERRED, AND
(II) BY WHICH SUCH TRANSFEREE AGREES TO BE BOUND BY THE OBLIGATIONS IMPOSED UPON
THE PURCHASERS UNDER THIS AGREEMENT TO THE SAME EXTENT AS IF SUCH TRANSFEREE
WERE A PURCHASER HEREUNDER.

 

3.3                                 SUBSEQUENT TRANSFEREES.  A TRANSFEREE TO
WHOM RIGHTS ARE TRANSFERRED PURSUANT TO THIS SECTION 3 MAY NOT AGAIN TRANSFER
SUCH RIGHTS TO ANY OTHER PERSON, OTHER THAN AS PROVIDED IN SECTIONS 3.1 OR 3.2
ABOVE.

 

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ARTICLE 4
REPRESENTATIONS OF PURCHASERS

 

4.1                                 CERTAIN REPRESENTATIONS OF THE PURCHASERS. 
IN CONNECTION WITH, AND IN CONSIDERATION OF, THE ACQUISITION OF THE COMMON STOCK
BY THE PURCHASERS, EACH PURCHASER HEREBY REPRESENTS AND WARRANTS TO THE COMPANY
AS FOLLOWS:

 

(a)                                  Such Purchaser acknowledges that it (i) is
acquiring the Common Stock for its own account without a view to distribution
within the meaning of the Securities Act; (ii) has had an opportunity to review
the Company’s filings with the SEC and all other information that it has deemed
necessary to make an informed investment decision with respect to an investment
in the Company in general and the Common Stock in particular; (iii) is
financially able to bear the economic risks of an investment in the Company; and
(iv) has such knowledge and experience in financial and business matters so as
to be capable, by reason of such knowledge and experience, of evaluating the
merits and risks of, and making an informed business decision with regard to,
the acquisition of the Common Stock.

 

(b)                                 Such Purchaser realizes that there are
significant restrictions on the transferability of the Common Stock, that the
Common Stock have not been registered for sale under the Securities Act or
applicable state securities laws (the “State Laws”), and may be sold only
pursuant to registration under the Securities Act and State Laws, or an
exemption therefrom.

 

(c)                                  Such Purchaser is an “accredited investor”
within the meaning of Rule 501 (a) of Regulation D, promulgated under the
Securities Act and was not organized for the specific purpose of acquiring the
Common Stock, and, in the case of an individual, is a resident of the state
referenced in the preamble of this Agreement or, with respect to an entity, has
its principal executive office located in its state of incorporation, as
referenced in the preamble to this Agreement.

 

(d)                                 Such Purchaser acknowledges that this
transaction has not been reviewed or approved by the United States Securities
and Exchange Commission (the “Commission”) or by any state securities or other
authority.

 

(e)                                  The acquisition of the Common Stock by such
Purchaser is not the result of any general solicitation or general advertising,
including, but not limited to (i) any advertisement, article, notice or other
communication published in any newspaper, magazine or similar media or broadcast
over television or radio; and (ii) any seminar or meeting whose attendees have
been invited by any general solicitation or general advertising.

 

(f)                                    Such Purchaser certifies, under penalty
of perjury, that it is not subject to the backup withholding provisions of the
Internal Revenue Code of 1986, as amended.  (Note:  A Purchaser is subject to
backup withholding if:  (i) the Purchaser fails to furnish the undersigned’s
Social Security Number or Taxpayer Identification Number herein; (ii) the
Internal Revenue Service notifies the Company that the Purchaser furnished an
incorrect Social Security Number or Taxpayer Identification Number; (iii) the
Purchaser is notified that the undersigned is subject to backup withholding; or
(iv) the Purchaser fails to certify that the Purchaser is not subject to

 

16

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backup withholding or the Purchaser fails to certify the Purchaser’s Social
Security Number or Taxpayer Identification Number).

 

4.2                                 EFFECT OF REPRESENTATIONS.  THE PARTIES
HERETO ACKNOWLEDGE AND AGREE THAT (I) THE REPRESENTATIONS OF THE PURCHASERS
CONTAINED IN SECTION 4.1 SHALL IN NO WAY MODIFY, EFFECT OR DIMINISH THE RIGHTS
OF THE PURCHASERS TO PURSUE ANY POTENTIAL CLAIM AGAINST THE COMPANY UNDER THE
PURCHASE AGREEMENT AND (II) NO BREACH OR ALLEGED BREACH OF ANY REPRESENTATION OR
WARRANTY CONTAINED IN SECTION 4.1 SHALL EFFECT THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT.

 

ARTICLE 5
MISCELLANEOUS

 

5.1                                 RECAPITALIZATIONS, EXCHANGES, ETC.  THE
PROVISIONS OF THIS AGREEMENT SHALL APPLY TO THE FULL EXTENT SET FORTH HEREIN
WITH RESPECT TO (I) THE REGISTRABLE SECURITIES, (II) ANY AND ALL SHARES OF
COMMON STOCK INTO WHICH THE REGISTRABLE SECURITIES ARE CONVERTED, EXCHANGED OR
SUBSTITUTED IN ANY RECAPITALIZATION OR OTHER CAPITAL REORGANIZATION BY THE
COMPANY AND (III) ANY AND ALL EQUITY SECURITIES OF THE COMPANY OR ANY SUCCESSOR
OR ASSIGN OF THE COMPANY (WHETHER BY MERGER, CONSOLIDATION, SALE OF ASSETS OR
OTHERWISE) WHICH MAY BE ISSUED IN RESPECT OF, IN CONVERSION OF, IN EXCHANGE FOR
OR IN SUBSTITUTION OF, THE REGISTRABLE SECURITIES AND SHALL BE APPROPRIATELY
ADJUSTED FOR ANY STOCK DIVIDENDS, SPLITS, REVERSE SPLITS, COMBINATIONS,
RECAPITALIZATIONS AND THE LIKE OCCURRING AFTER THE DATE HEREOF. THE COMPANY
SHALL CAUSE ANY SUCCESSOR OR ASSIGN (WHETHER BY MERGER, CONSOLIDATION, SALE OF
ASSETS OR OTHERWISE) TO ENTER INTO A NEW REGISTRATION RIGHTS AGREEMENT WITH THE
HOLDERS ON TERMS SUBSTANTIALLY THE SAME AS THIS AGREEMENT AS A CONDITION OF ANY
SUCH TRANSACTION.

 

5.2                                 NO INCONSISTENT AGREEMENTS.  THE COMPANY HAS
NOT AND SHALL NOT ENTER INTO ANY AGREEMENT WITH RESPECT TO ITS SECURITIES THAT
IS INCONSISTENT WITH THE RIGHTS GRANTED TO A PURCHASER IN THIS AGREEMENT.  THE
PARTIES ACKNOWLEDGE AND AGREE THAT THE COMPANY MAY GRANT REGISTRATION RIGHTS
HEREAFTER, WHICH SHALL BE PARI PASSU WITH THE REGISTRATION RIGHTS OF A
PURCHASER, AND SHALL NOT BE DEEMED TO CONFLICT WITH THIS COVENANT.

 

5.3                                 AMENDMENTS AND WAIVERS.  THE PROVISIONS OF
THIS AGREEMENT MAY BE AMENDED AND THE COMPANY MAY TAKE ACTION HEREIN PROHIBITED,
OR OMIT TO PERFORM ANY ACT HEREIN REQUIRED TO BE PERFORMED BY IT, IF, BUT ONLY
IF, THE COMPANY HAS OBTAINED THE WRITTEN CONSENT OF HOLDERS OF AT LEAST A
MAJORITY OF THE REGISTRABLE SECURITIES THEN IN EXISTENCE.

 

5.4                                 SEVERABILITY.  WHENEVER POSSIBLE, EACH
PROVISION OF THIS AGREEMENT SHALL BE INTERPRETED IN SUCH MANNER AS TO BE
EFFECTIVE AND VALID UNDER APPLICABLE LAW, BUT IF ANY PROVISION OF THIS AGREEMENT
SHALL BE HELD TO BE PROHIBITED BY OR INVALID UNDER APPLICABLE LAW, SUCH
PROVISION SHALL BE INEFFECTIVE ONLY TO THE EXTENT OF SUCH PROHIBITION OR
INVALIDITY, WITHOUT INVALIDATING THE REMAINDER OF SUCH PROVISION OR THE
REMAINING PROVISIONS OF THIS AGREEMENT.

 

5.5                                 COUNTERPARTS.  THIS AGREEMENT MAY BE
EXECUTED IN ONE 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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5.6                                 NOTICES.  ANY NOTICES REQUIRED OR PERMITTED
TO BE GIVEN UNDER THE TERMS OF THIS AGREEMENT SHALL BE SENT BY CERTIFIED OR
REGISTERED MAIL (RETURN RECEIPT REQUESTED) OR DELIVERED PERSONALLY OR BY COURIER
(INCLUDING A RECOGNIZED OVERNIGHT DELIVERY SERVICE) OR BY FACSIMILE AND SHALL BE
EFFECTIVE FIVE DAYS AFTER BEING PLACED IN THE MAIL, IF MAILED BY REGULAR UNITED
STATES MAIL, OR UPON RECEIPT, IF DELIVERED PERSONALLY OR BY COURIER (INCLUDING A
RECOGNIZED OVERNIGHT DELIVERY SERVICE) OR BY FACSIMILE, IN EACH CASE ADDRESSED
TO A PARTY.  THE ADDRESSES FOR SUCH COMMUNICATIONS SHALL BE:

 

If to the Company:

 

 

 

 

Tower Tech Holdings Inc.

 

 

980 Maritime Drive, Suite 6

 

 

Manitowoc, Wisconsin 54220

 

 

Attention: Chief Executive Officer

 

 

Facsimile: (920) 684-5579

 

 

 

With copy to:

 

 

 

 

DLA Piper US LLP

 

 

203 N. LaSalle Street

 

 

Suite 1900

 

 

Chicago, IL 60601

 

 

Attention: Stephen A. Landsman, Esq.

 

 

Facsimile No.: (312)-630-6330

 

 

 

If to Kolbach or EMS:

 

 

 

 

Mr. Joseph A. Kolbach

 

 

c/o Energy Maintenance Service, LLC

 

 

129 Main Avenue

 

 

P.O. Box 158

 

 

Gary, SD 57237

 

 

Facsimile No.: (605) 272-5402

 

 

 

With copy to:

 

 

 

 

Fabyanske, Westra, Hart & Thomson P.A.

 

 

800 LaSalle Avenue

 

 

Suite 1900

 

 

Minneapolis, MN 55402

 

 

Attn: Scott L. Anderson

 

 

Facsimile No.: (612) 359-7602

 

 

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If to Fagen:

 

 

 

 

Fagen, Inc.

 

 

501 West Highway 212

 

 

P.O. Box 159

 

 

Granite Falls, MN 56241

 

 

Attn: Ron Fagen

 

 

Facsimile No.: (320) 564-3278

 

 

 

If to Yarano:

 

 

 

 

Daniel A. Yarano

 

 

c/o Fredrikson & Byron, P.A.

 

 

200 South Sixth Street, Suite 4000

 

 

Minneapolis, MN 55402

 

 

Facsimile No.: (605) 272-5402

 

 

Each party shall provide notice to the other party of any change in address.

 

5.7                                 GOVERNING LAW.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF WISCONSIN,
WITHOUT REGARD TO THE CONFLICTS OF LAWS RULES OR PROVISIONS.

 

5.8                                 FORUM; SERVICE OF PROCESS.  ANY LEGAL SUIT,
ACTION OR PROCEEDING BROUGHT BY THE COMPANY, PURCHASERS, ANY OTHER HOLDERS, ANY
PERSON ENTITLED TO INDEMNIFICATION OR CONTRIBUTION HEREUNDER, OR ANY OF THEIR
RESPECTIVE AFFILIATES ARISING OUT OF OR BASED UPON THIS AGREEMENT SHALL BE
INSTITUTED EXCLUSIVELY IN ANY FEDERAL OR STATE COURT IN THE STATE OF WISCONSIN,
AND EACH SUCH PERSON IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OR ANY SUCH PROCEEDING, AND IRREVOCABLY
SUBMITS TO THE JURISDICTION OF SUCH COURTS IN ANY SUCH SUIT, ACTION OR
PROCEEDING.

 

5.9                                 CAPTIONS.  THE CAPTIONS, HEADINGS AND
ARRANGEMENTS USED IN THIS AGREEMENT ARE FOR CONVENIENCE ONLY AND DO NOT IN ANY
WAY LIMIT OR AMPLIFY THE TERMS AND PROVISIONS HEREOF.

 

5.10                           NO PREJUDICE.  THE TERMS OF THIS AGREEMENT SHALL
NOT BE CONSTRUED IN FAVOR OF OR AGAINST ANY PARTY ON ACCOUNT OF ITS
PARTICIPATION IN THE PREPARATION HEREOF.

 

5.11                           WORDS IN SINGULAR AND PLURAL FORM.  WORDS USED IN
THE SINGULAR FORM IN THIS AGREEMENT SHALL BE DEEMED TO IMPORT THE PLURAL, AND
VICE VERSA, AS THE SENSE MAY REQUIRE.

 

5.12                           REMEDY FOR BREACH.  THE COMPANY HEREBY
ACKNOWLEDGES THAT IN THE EVENT OF ANY BREACH OR THREATENED BREACH BY THE COMPANY
OF ANY OF THE PROVISIONS OF THIS AGREEMENT, THE HOLDERS WOULD HAVE NO ADEQUATE
REMEDY AT LAW AND COULD SUFFER SUBSTANTIAL AND IRREPARABLE DAMAGE.  ACCORDINGLY,
THE COMPANY HEREBY AGREES THAT, IN SUCH EVENT, THE HOLDERS SHALL BE ENTITLED,
AND NOTWITHSTANDING ANY ELECTION BY ANY HOLDER TO CLAIM DAMAGES, TO OBTAIN A
TEMPORARY AND/OR PERMANENT INJUNCTION TO RESTRAIN ANY SUCH BREACH OR THREATENED
BREACH OR TO

 

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OBTAIN SPECIFIC PERFORMANCE OF ANY SUCH PROVISIONS, ALL WITHOUT PREJUDICE TO ANY
AND ALL OTHER REMEDIES WHICH ANY HOLDERS MAY HAVE AT LAW OR IN EQUITY.

 

5.13                           SUCCESSORS AND ASSIGNS, THIRD PARTY
BENEFICIARIES.  THIS AGREEMENT AND ALL OF THE PROVISIONS HEREOF SHALL BE BINDING
UPON AND INURE TO THE BENEFIT OF THE PARTIES HERETO, EACH ASSIGNEE OF THE
HOLDERS PURSUANT TO ARTICLE 3 AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS AND
EXECUTORS, ADMINISTRATORS AND HEIRS.  HOLDERS ARE INTENDED THIRD PARTY
BENEFICIARIES OF THIS AGREEMENT AND THIS AGREEMENT MAY BE ENFORCED BY SUCH
HOLDERS.

 

5.14                           ENTIRE AGREEMENT.  THIS AGREEMENT SETS FORTH THE
ENTIRE AGREEMENT AND UNDERSTANDING BETWEEN THE PARTIES AS TO THE SUBJECT MATTER
HEREOF AND MERGES AND SUPERSEDES ALL PRIOR DISCUSSIONS, AGREEMENTS AND
UNDERSTANDINGS OF ANY AND EVERY NATURE AMONG THEM.

 

5.15                           ATTORNEYS’ FEES.  IN THE EVENT OF ANY ACTION OR
SUIT BASED UPON OR ARISING OUT OF ANY ACTUAL OR ALLEGED BREACH BY ANY PARTY OF
ANY REPRESENTATION, WARRANTY, COVENANT OR AGREEMENT IN THIS AGREEMENT, THE
PREVAILING PARTY SHALL BE ENTITLED TO RECOVER ITS REASONABLE ATTORNEYS’ FEES AND
EXPENSES OF SUCH ACTION OR SUIT FROM THE OTHER PARTY IN ADDITION TO ANY OTHER
RELIEF ORDERED BY ANY COURT.

 

5.16                           TERMINATION OF RIGHTS.  ALL RIGHTS UNDER THIS
AGREEMENT WILL TERMINATE AS TO A HOLDER WHEN THAT HOLDERS NO LONGER HOLDS ANY
REGISTRABLE SECURITIES.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Registration Rights
Agreement to be duly executed as of the date and year first written above.

 

 

COMPANY:

 

 

 

 

 

TOWER TECH HOLDINGS INC.

 

 

 

 

 

 

 

 

By:

/s/ Steven A. Huntington

 

 

Name:  Steven A. Huntington

 

 

Title:    Chief Financial Officer

 

 

 

 

 

 

 

 

PURCHASERS:

 

 

 

 

 

EMS, Inc.

 

 

 

 

 

 

 

 

/s/ Joseph A. Kolbach

 

 

By:

Joseph A. Kolbach

 

 

Its:

President

 

 

 

 

 

 

 

 

Fagen, Inc.

 

 

 

 

 

 

 

 

/s/ Roland Fagen

 

 

Roland “Ron” Fagen

 

 

Its: President and Chief Executive Officer

 

 

 

 

 

 

 

 

/s/ Joseph A. Kolbach

 

 

Joseph A. Kolbach

 

 

 

 

 

 

 

 

/s/ Daniel A. Yarano

 

 

Daniel A. Yarano

 

 

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