Document:

EX-10.29

 

ZBB ENERGY CORPORATION

N93 W 14475 Whittaker Way

Menomonee Falls, Wisconsin 53051

August 7, 2007          

Bushido Capital Master Fund L.P.

145 East 57th Street, 11th Floor

New York, NY 10022

Attention: Ronald S. Dagar, Director

Pierce Diversified Strategy Master Fund, LLC, Series BUS

145 East 57th Street, 11th Floor

New York, NY 10022

Attention: Ronald S. Dagar, Attorney-in-Fact

ABS SOS-Plus Partners, Ltd.

Trehl Plaza Suite 4

Nassau, Bahamas CB-11267

Attn: Patrina Khoo Farquharson

Re: ZBB Energy Corporation Payoff, Accord, Satisfaction and Full Release

Gentlemen:

     Reference is made to (a) the Note Purchase Agreement (the “Note Purchase Agreement”)
among ABS SOS-Plus Partners, Ltd. (“ABS SOS”), Bushido Capital Master Fund L.P.
(“Bushido”) and Pierce Diversified Strategy Master Fund, LLC, Series BUS (“Pierce”
and together with ABS SOS and Bushido, the “Lenders”) and ZBB Energy Corporation (the
“Company”) and its subsidiaries, (b) the related Notes aggregating $2,226,667 (the
“Notes”) payable to the of the Lenders, (c) the security and pledge agreements of the
Company and its subsidiaries, guaranty agreements of the Company, and related personal performance
guaranty agreements of the Company’s officers (collectively the “Collateral Documents”),and
(d) the registration rights agreement among the Company and the Lenders (the “Existing
Registration Rights Agreement”), all dated as of June 14, 2006 (collectively, the
“Documents”).

     Unless otherwise defined herein, all capitalized terms, when used in this letter agreement
(“Agreement”) shall have the same meaning as is defined in the Note Purchase Agreement. As
used in this Agreement, the term “Business Day(s)” shall mean any day, other than Saturday
or Sunday or any other day on which Citibank NA, New York, New York shall be closed for business.
The Company, ABS SOS, Bushido and Pierce are hereinafter sometimes collectively referred to as the
“Parties.”

     This Agreement shall set forth the terms and conditions of our mutual agreement and
understanding with respect to (i) the payment in full by the Company of the Notes and all other
obligations to the Lenders under the Note Purchase Agreement, (ii) the release by the Lenders of
all liens and security interests granted under the Collateral Documents, and (iii) the termination

-1-

 

of the Existing Registration Rights agreement and the execution of a new registration rights
agreement between the Company and ABS SOS (the “New Registration Rights Agreement”).

     1. Full Settlement Amount. Not later than the Business Day immediately following the
date on which this Agreement shall have been executed by each of the Parties, the Company shall
deliver to the Lenders, by wire transfer of federal funds to the attorneys’ trust account of
Crowell & Moring LLP, counsel to the Lenders, in accordance with the wire instructions set forth on
Exhibit A annexed hereto (the “Wire Instructions”), the aggregate amount of
$2,246,667 (the “Full Settlement Amount”), to be allocated among the Lenders and others, as
follows:

	 	 	 	 	 
	ABS SOS-Plus Partners, Ltd.
	 	$	1,113,334	 
	Bushido Capital Master Fund L.P.
	 	$	556,667	 
	Pierce Diversified Strategy Master Fund
	 	$	556,666	 
	Counsel fees
	 	$	20,000	 

     An aggregate of $2,226,667 of the Full Settlement Amount shall represent payment in full of
the Notes and all other obligations of the Company under the Note Purchase Agreement and the
Collateral Documents, and the balance of $20,000 shall represent payment of legal fees of the
Lenders’ counsel.

     2. Payment and Discharge of Obligations; Releases.

          (a) Upon receipt of the Full Settlement Amount, as set forth in Section 1 above (i) the Notes
shall be deemed to be paid in full, (ii) all prior default notices and demands shall be deemed to
be withdrawn by the Lenders, (iii) all obligations of the Company under the Note Purchase Agreement
and the Collateral Documents shall be deemed to be fully discharged, satisfied and terminated, and,
(iv) the Lenders shall each jointly and severally discharge the Company and each of its
subsidiaries and affiliates from all liabilities and obligations under the Notes, the Note Purchase
Agreement and the Collateral Documents, including, without limitation, any and all claims, losses,
potential losses or costs relating thereto.

          (b) Upon (i) receipt of the Full Settlement Amount, as set forth in Section 1 above, and (ii)
the execution and delivery by the Company and ABS SOS of the registration rights agreement in the
form of Exhibit B annexed hereto (the “New Registration Rights Agreement”), the
Existing Registration Rights Agreement shall be deemed for all purposes to be terminated and
without any further force or effect, all obligations and liabilities of the Company and any of its
subsidiaries or affiliates under the Existing Registration Rights Agreement shall, for all
purposes, be deemed to be terminated, and each of the Lenders hereby each jointly and severally
discharge the Company and each of its subsidiaries and affiliates from all liabilities and
obligations under the Existing Registration Rights Agreement, including, without limitation, any
and all claims, losses, potential losses or costs relating thereto.

          (c) Upon (i) receipt of the Full Settlement Amount and (ii) the execution and delivery of the
New Registration Rights Agreement, (A) each of the Lenders do hereby jointly

-2-

 

and severally release
and discharge the Company and each of its subsidiaries, officers, directors, employees,
representatives and affiliates (collectively, the “Company Released Parties”) from and
against any and all liabilities and obligations of every kind and description that the Company
Released Parties may owe to the Lenders or any of them, save and except for the liabilities and
obligations of the Company that are set forth in this Agreement and in the New Registration Rights
Agreement; and (B) the Company, on behalf of itself and its subsidiaries, does hereby jointly and
severally release and discharge the Lenders and each of their respective subsidiaries, officers,
directors, employees, representatives and affiliates (collectively, the “Lender Released
Parties”) from and against any and all liabilities and obligations of every kind and
description that the Lender Released Parties may owe to the Company or any of its subsidiaries,
save and except for the liabilities and obligations of the Lenders that are set forth in this
Agreement and in the New Registration Rights Agreement.

     3. Authorization to Terminate Liens and Security Interests. Upon receipt by the
Lenders of the Full Settlement Amount, as set forth in Section 1, all of the Collateral Documents
shall be deemed to be terminated, and in connection therewith:

          (a) the Company and its subsidiaries are authorized to prepare and file all UCC-3 and related
termination statements releasing any and all financing statements and other liens filed by or on
behalf of the Lenders against the assets and properties of the Company and its subsidiaries
securing the obligations under the Notes,

          (b) all liens on any securities of the subsidiaries of the Company that have been pledged to
the Lenders under the Note Purchase Agreement shall be released and terminated and such securities
shall be returned by the Lenders to the Company’s counsel within forty-eight (48) hours of payment
of the Full Settlement Amount,

          (c) the Company and its subsidiaries are authorized to prepare and file any termination of
mortgage or any other similar liens or fixture filings and the Lenders will execute any such
reasonable instrument to effect such termination,

          (d) the Company and its subsidiaries are authorized to prepare and file any termination of any
and all liens on trademarks, patents, trade secrets or other intellectual property of the Company
or its subsidiaries and the Lenders will execute any such reasonable instrument to effect such
termination, and

          (e) any personal or performance guarantees or any other documents or instruments delivered by
any of the executive officers or directors of the Company shall be deemed terminated, null and
void.

     4. Warrant Exercise.

          (a) On June 15, 2007, ABS SOS purchased for $1,113,330, or $2.55 per share (the “Cash
Exercise Price”), an aggregate of 436,600 shares (the “ABS SOS Warrant Shares”) of
Company Common Stock underlying warrants issued on June 14, 2006 (the “ABS SOS Warrants”)
entitling ABS SOS to purchase up to 436,600 shares of Company Common Stock.

-3-

 

          (b) On or about June 15, 2007, Bushido purchased in a cashless exercise an aggregate of
110,628 shares (the “Bushido Warrant Shares”).of Company Common Stock underlying warrants
issued on June 14, 2006 (the “Bushido Warrants”) entitling Bushido to purchase up to
218,300 shares of Company Common Stock.

          (c) On or about June 15, 2007, Pierce purchased in a cashless exercise an aggregate of 110,628
shares (the “Pierce Warrant Shares”).of Company Common Stock underlying warrants issued on
June 14, 2006 (the “Pierce Warrants”) entitling Pierce to purchase up to 218,300 shares of
Company Common Stock.

     5. ABS SOS Warrant Shares. Simultaneous with the execution and delivery of this
Agreement by the Parties, the Company and ABS SOS shall enter into the New Registration Rights
Agreement in the form of Exhibit B annexed hereto and made a part hereof. In connection
with such New Registration Rights Agreement, each of the Company and ABS SOS do hereby agree as
follows:

          (a) By not later than 5:30 P.M. (EDT) on August 15, 2007, the Company shall cause to be filed
with the Securities and Exchange Commission (the “SEC”) a Form SB-2 resale registration
statement (the “Registration Statement”) to register the ABS SOS Warrant Shares for resale
under the Securities Act of 1933, as amended (the “Act”).

          (b) In the event that, for any reason (other than the failure or refusal of ABS SOS to confirm
the accuracy of disclosure information concerning its beneficial ownership and affiliations, as
required by the SEC under the rules and regulations promulgated under the Act), the Company shall
fail or refuse to file the Registration Statement, by 5:30 P.M. (EDT) on August 15, 2007, then and
in such event the Company shall be liable to pay to ABS SOS, as liquidated damages, $1,500.00 for
each calendar day following August 15, 2007, until the earliest to occur of (i) the time that such
Registration Statement is filed with the SEC, (ii) the last date on which ABS SOS sells all of such
436,600 ABS SOS Warrant Shares, or (iii) ABS SOS is able to publicly sell all of ABS SOS’ Warrant
Shares (A) in one three-month period pursuant to the provisions of Rule 144, or (B) pursuant to the
provisions of Rule 144(k).

          (c) In the event that the Registration Statement shall be declared effective by the SEC by not
later than 5:30 P.M. (EST) on October 31, 2007, then and in such event, subject only to its ongoing
covenants under the New Registration Rights Agreement (including its obligation to keep such
Registration Statement current), the Company shall be deemed to have discharged all of its
obligations to ABS SOS under the New Registration Rights Agreement, and the Put (as defined below)
shall not be exercisable.

          (d) If, for any reason (other than the failure or refusal of ABS SOS to confirm the accuracy
of disclosure information concerning its beneficial ownership and affiliations, as required by the
SEC under the rules and regulations promulgated under the Act), the Registration Statement is not
declared effective by the SEC by 5:30 P.M. (EST) on October 31, 2007, then and in such event, ABS
SOS shall have the right (the “Put”), exercisable by written notice from ABS SOS to the
Company given at any time from and after 5:30 P.M. (EST) on October 31, 2007 through and including
5:30 P.M. (EST) on November 15, 2007 (the “Put Expiration Date”), to require the Company to
purchase from ABS SOS 185,555 ABS SOS Warrant Shares for $1,113,300. Upon delivery of the
foregoing notice, (i) ABS SOS shall deliver, within three

-4-

 

Business Days of such notice, to the
Company’s transfer agent certificate(s) evidencing 185,555 shares of the Company’s Common Stock,
together with a blank stock power duly endorsed by ABS SOS, for cancellation upon receipt of
$1,113,300, and (ii) within three Business Days after delivery of such certificate(s) to the
transfer agent, the Company shall deliver by wire transfer to the attorneys’ escrow account of
counsel to ABS SOS the sum of $1,113,300. If the certificate(s) so delivered evidence more than
185,555 shares of Common Stock, the transfer agent shall, and the Company shall cause the transfer
agent to, promptly return to ABS SOS certificates evidencing such excess number of shares of Common
Stock.

          (e) If ABS SOS does not timely exercise the Put under Section 5(d) above, then the Company
shall pay to ABS SOS, as liquidated damages, the sum of $1,500 for each calendar day from and after
November 1, 2007 that the Registration Statement is not declared effective by the SEC; provided,
however, that the aggregate amount of such per diem liquidated damages amount set forth in this
Section 5(e) shall not exceed the sum of $50,000.

          (f) Whether or not the Put is exercised:

                         (i) With a view to making available to ABS SOS the benefits of certain rules and regulations
of the SEC which may permit the sale of the ABS SOS Warrant Shares to the public without
registration, the Company agrees at all times to file with the SEC all reports and other documents
required of the Company under the Act and the Securities Exchange Act of 1934, as amended, (the
“Exchange Act”);

                         (ii) the Company will cooperate in all reasonable respects with ABS SOS in securing any and
all legal opinions from one or more legal counsel selected by ABS SOS to permit ABS SOS to effect
sales of all or any portion of the Warrant Shares under the applicable provisions of Rule 144 or
any other appropriate and applicable re-sale exemptions from the registration requirements of the
Act; and

                         (iii) the Company shall authorize its transfer agent to accept one or more opinions of legal
counsel selected by ABS SOS; provided, that, (A) such attorneys’ opinion letter(s) are drafted by
one or more reputable securities law firm, (B) such counsel opines without qualification (other
than normal qualifications given with respect to such opinions), and (C) the Company’s current
securities counsel, Hodgson Russ LLP shall not be required to provide any such legal opinion(s).
The Company acknowledges that Crowell & Moring LLP and Tarter Krinsky & Drogin LLP are each
reputable securities law firms.

     6. Bushido Warrant Shares and Pierce Warrant Shares.

          (a) With a view to making available to Bushido and Pierce the benefits of certain rules and
regulations of the SEC which may permit the sale of the Bushido Warrant Shares and the Pierce
Warrant Shares to the public without registration, the Company agrees at all times to file with the
SEC all reports and other documents required of the Company under the Act and the Exchange Act;

          (b) The Company will cooperate in all reasonable respects with Bushido and Pierce in securing
any and all legal opinions from one or more legal counsel selected by Bushido and Pierce to permit
Bushido and Pierce to effect sales of all or any portion of the Bushido

-5-

 

Warrant Shares and Pierce
Warrant Shares, respectively, under the applicable provisions of Rule 144 or any other appropriate
and applicable re-sale exemptions from the registration requirements of the Act; and

          (c) The Company shall instruct, and hereby authorizes, its transfer agent to accept one or
more opinions of legal counsel selected by Bushido and Pierce, provided, that, (A) such attorneys’
opinion letter(s) are drafted by one or more reputable securities law firm, (B) such counsel opines
without qualification (other than normal qualifications given with respect to such opinions), and
(C) the Company’s current securities counsel, Hodgson Russ LLP shall not be required to provide any
such legal opinion(s). The Company acknowledges that Crowell & Moring LLP and Tarter Krinsky &
Drogin LLP are each reputable securities law firms.

     7. Separate Agreements. The provisions of Section 5 of this Agreement and of the New
Registration Rights Agreement shall only apply to, and be deemed to be agreements among, the
Company and ABS SOS. None of the other Parties to this Agreement are parties to or direct or
indirect beneficiaries of the provisions of such Section 5 or the New Registration Rights
Agreement. The provisions of Section 5 of this Agreement and the New Registration Rights Agreement
are not intended to be relied upon or viewed by any of the Lenders, including ABS SOS, as part of
the consideration for the releases and other benefits granted pursuant to Sections 1 through 3 of
this Agreement, and none of the Lenders, other than ABS SOS, may assert or allege that any actual
or alleged breach or violation by the Company of any of the provisions of Section 5 of this
Agreement or the New Registration Rights Agreement is causing or has caused, directly or
indirectly, any form of damage, loss, claim, liability or default herein or otherwise to either
Bushido, Pierce or any of their respective affiliates.

     8. Miscellaneous.

          (a) This Agreement and the transactions contemplated hereby have been duly authorized by the
board of directors or general partner of each of the Parties hereto and constitutes a legal and
binding agreement upon the respective Parties hereto.

          (b) This Agreement has been entered into and shall be governed and construed in accordance
with the laws of the State of New York.

          (c) In the event that any dispute shall arise under this Agreement or the New Registration
Rights Agreement, each of the Parties hereto does hereby consent to the exclusive jurisdiction of
the United States District Court for the Southern District of New York or the Supreme Court of the
States of New York. Each of the Parties hereto consents to service of process by any means
authorized by the applicable law of the forum in any action brought under or arising out of this
Agreement or the New Registration Rights Agreement, and each Party irrevocably waives, to the
fullest extent each may effectively do so, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.

          (d) This Agreement shall inure to the benefit of and be binding upon the Parties hereto and
their respective successors and assigns.

          (e) This Agreement may be executed in one or more counterparts, each of which shall be deemed
and original but all of which shall constitute one and the same agreement

-6-

 

and shall become
effective when counterparts have been signed by each Party and delivered to the other Parties.
This Agreement, once executed by a Party, may be delivered to the other Parties hereto by facsimile
transmission, pdf file electronic mail of a copy of this Agreement bearing the signature of the
Party so delivering this Agreement.

          (f) The provisions of this Agreement and the New Registration Rights Agreement shall be
construed according to their fair meaning and neither for nor against any Party hereto irrespective
of which Party caused such provisions to be drafted. Each of the Parties hereto acknowledge that
it has been represented by an attorney in connection with the preparation and execution of this
Agreement and the New Registration Rights Agreement.

          (g) In the event any suit or other legal proceeding is brought for the enforcement of any of
the provisions of this Agreement, the Parties hereto agree that the prevailing Party or Parties
shall be entitled to recover from the other Party or Parties upon final judgment on the merits
reasonable attorneys’ fees, including attorneys’ fees for any appeal, and costs incurred in
bringing such suit or proceeding.

          (h) The Company shall furnish to the Lenders or its counsel for their review a draft of any
press release or Form 8-K Interim Report that the Company plans to file with the SEC with respect
to disclosing this Agreement and the New Registration Rights Agreement.

[balance of this page left blank – signature page follows]

-7-

 

     If the foregoing accurately reflects the mutual agreement and understanding of the Parties
hereto with respect to the subject matter hereof, please so indicate by executing and returning a
copy of this Agreement in the space provided below and completing Exhibit A.

	 	 	 	 	 
	 	Very truly yours,

ZBB ENERGY CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	Robert Parry 	 
	 	 	Title:  	Chief Executive Officer 	 
	 

	 	 	 	 	 
	 	ABS SOS-PLUS PARTNERS, LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	BUSHIDO CAPITAL MASTER FUND L.P.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	 	PIERCE DIVERSIFIED STRATEGY

MASTER FUND, LLC, SERIES BUS

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

-8-EX-10.30

 

REGISTRATION RIGHTS AGREEMENT

          THIS REGISTRATION RIGHTS AGREEMENT (the “Agreement”) is made as of August 7, 2007 by and among
ZBB Energy Corporation, a Wisconsin corporation (the “Company”), and ABS-SOS Plus Partners, Ltd.
(the “Investor”).

WITNESSETH:

          WHEREAS, the Investor has acquired 436,600 shares of Common Stock (the “Warrant Shares”) of
the Company upon exercise of certain warrants held by Investor; and

          WHEREAS, the Company has agreed with the Investor to grant certain registration rights with
respect to the Warrant Shares and the Investor has agreed to waive all rights, privileges,
defaults, or claims under, and to terminate in full, the Registration Rights Agreement among the
parties and certain other investors;

          NOW THEREFORE, in consideration of the foregoing, the parties agree as follows:

          1. Definitions. As used in this Agreement, the following terms shall have the
following meanings:

               “Commission” shall mean the Securities and Exchange Commission, or any other federal agency at
the time administering the Securities Act.

               “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, or any similar
federal statute and the rules and regulations thereunder, all as the same shall be in effect at the
time.

               “Holder” shall mean any holder of outstanding Registrable Securities or anyone who holds
outstanding Registrable Securities to whom the registration rights conferred by this Agreement have
been transferred in compliance with this Agreement.

               “Initiating Holders” shall mean any Holder or Holders of at least fifty-one percent (51%) of
the Registrable Securities then outstanding.

               “Register,” “registered” and “registration” shall refer to a registration effected by
preparing and filing a registration statement in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration statement, and compliance with
applicable state securities laws of such states in which Holders notify the Company of their
intention to offer Registrable Securities.

               “Registrable Securities” shall mean all of the following to the extent the same have not been
sold to the public (i) any and all of the Warrant Shares; or (ii) stock issued in respect of stock
referred to in (i) above in any reorganization; or (iii) stock issued in respect of the stock
referred to in (i) or (ii) as a result of a stock split, stock dividend, recapitalization or
combination. Notwithstanding the foregoing, Registrable Securities shall not include otherwise
Registrable Securities (i) sold by a person in a transaction in which his rights under this
Agreement are not properly assigned; or (ii) (A) sold to or through a broker or dealer or
underwriter in a public

 

 

distribution or a public securities transaction, or (B) sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under Section 4(1) thereof
so that all transfer restrictions, and restrictive legends with respect thereto, if any, are
removed upon the consummation of such sale or (C) the registration rights associated with such
securities have been terminated pursuant to Section 12 of this Agreement. Notwithstanding the
foregoing, the Registrable Securities shall cease to be Registrable Securities if and to the extent
that the Holder is able to dispose of all of such Holder’s Registrable Securities (i) in one
three-month period pursuant to the provisions of Rule 144, or (ii) otherwise pursuant to the
provisions of Rule 144(k).

               “Rule 144” shall mean Rule 144, as amended from time to time, under the Securities Act or any
successor or similar rule as may be enacted by the Commission from time to time, but shall not
include Rule 144A.

               “Rule 144A” shall mean Rule 144A under the Securities Act or any successor or similar rule as
may be enacted by the Commission from time to time, but shall not include Rule 144.

               “Securities Act” shall mean the Securities Act of 1933, as amended, or any similar federal
statute and the rules and regulations thereunder, all as the same shall be in effect at the time.

               “Settlement Agreement” shall mean that letter agreement, dated of even date herewith among the
Company, the Investor, Bushido Capital Master Fund L.P. and Pierce Diversified Strategy Master
Fund, LP, Series BUS.

          2. Restrictions on Transferability. The Registrable Securities shall not be sold,
assigned, transferred or pledged except upon the conditions specified in this Agreement, which
conditions are intended to ensure compliance with the provisions of the Securities Act. Each Holder
will cause any proposed purchaser, assignee, transferee, or pledgee of the Registrable Securities
held by a Holder to agree to take and hold such securities subject to the provisions and upon the
conditions specified in this Agreement.

          3. Restrictive Legend. Each certificate representing Registrable Securities shall
(unless otherwise permitted by the provisions of Section 4 below) be stamped or otherwise imprinted
with a legend as provided in Warrant (in addition to any legend required under applicable state
securities laws or otherwise). Each Holder consents to the Company making a notation on its
records and giving instructions to any transfer agent of the Registrable Securities in order to
implement the restrictions on transfer established in this Agreement.

          4. Notice of Proposed Transfer. The Holder of each certificate representing
Registrable Securities, by acceptance thereof, agrees to comply in all respects with the provisions
of this Section 4. Each such Holder agrees not to make any disposition of all or any portion of any
Registrable Securities unless and until:

 

 

               a. There is in effect a registration statement under the Securities Act covering such proposed
disposition and such disposition is made in accordance with such registration statement; or

               b. Such Holder shall have notified the Company of the proposed disposition and shall have
furnished the Company with a detailed statement of the circumstances surrounding the proposed
disposition, and if reasonably requested by the Company, such Holder shall furnish the Company with
an opinion of counsel, reasonably satisfactory to the Company that such disposition shall not
require registration of such shares under the Securities Act. It is agreed, however, that no such
opinion will be required for Rule 144 or Rule 144A transactions, except as required by the
Company’s transfer agent or in unusual circumstances.

               c. Notwithstanding the provisions of paragraphs (a) and (b) above, no such registration
statement or opinion of counsel shall be necessary for a transfer by a Holder which is a
partnership to a partner of such partnership or a retired partner of such partnership who retires
after the date hereof, or to the estate of any such partner or retired partner or the transfer by
gift, will, or intestate succession of any partner to his spouse or siblings, lineal descendants or
ancestors of such partner or spouse, provided, however, that such transferee agrees in writing to
be subject to all of the terms hereof to the same extent as if he were an original Holder
hereunder.

          5. Demand Registration.

               a. On or before 5:30 P.M. (EDT) on August 15, 2007, the Company shall file with the Securities
and Exchange Commission (the “SEC”) a registration statement on Form SB-2 or any other applicable
form for registering securities (the “Demand Registration Statement”) registering all of the
Registrable Securities. The Company shall use its best efforts to obtain effectiveness of the
Registration Statement with respect to all Registrable Securities on or before 5:30 P.M. (EDT) on
October 31, 2007, and shall respond to all oral and written comments from the staff of the SEC.

               b. In the event that for any reason (other than the failure or refusal of the Investor to
confirm the accuracy of disclosure information concerning its beneficial ownership and
affiliations, as required by the SEC under the rules and regulations promulgated under the Act),
the Demand Registration Statement is not timely filed with the SEC by 5:30 P.M. (EDT) on August 15,
2007, then and in such event the provisions of Section 5(b) of the Settlement Agreement
shall be applicable. In the event that for any reason (other than the failure or refusal of the
Investor to confirm the accuracy of disclosure information concerning its beneficial ownership and
affiliations, as required by the SEC under the rules and regulations promulgated under the Act),
the Demand Registration Statement registering all of the Registrable Securities is not declared
effective by the SEC on or before 5:30 P.M. (EDT) on October 31, 2007, then and in such event the
provisions of Sections 5(d) and (e) of the Settlement Agreement shall be applicable. In
such connection, each of the Company and the Investor agrees that the applicable provisions of the
Settlement Agreement are deemed to be incorporated by this reference in this Agreement.

 

 

               c. The parties shall endeavor to take all actions to obtain effectiveness of such Demand
Registration Statement or, if and to the extent such rule becomes available, utilize the re-sale
exemptions provided under Rule 144 in order to provide liquidity for these shares.

     6. Piggyback Registration.

               a. If at any time or from time to time, the Company shall determine to register any of its
securities, for its own account or the account of any of its shareholders, other than a
registration relating solely to employee benefit plans, or a registration relating solely to an SEC
Rule 145 transaction, or a registration on any form (other than Form SB-1, SB-2, S-1, S-2 or S-3,
or their successor forms) which does not include substantially the same information as would be
required to be included in a registration statement covering the sale of Registrable Securities,
the Company will:

                    i. give to each Holder written notice thereof as soon as practicable prior to filing the
registration statement; and

                    ii. include in such registration and in any underwriting involved therein, all the Registrable
Securities specified in a written request or requests, made within fifteen (15) days after receipt
of such written notice from the Company, by any Holder or Holders, except as set forth in
subsection (b) below.

               b. If the registration is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as a part of the written notice given pursuant to subsection
6(a)(i). In such event, the right of any Holder to registration pursuant to Section 6 shall be
conditioned upon such Holder’s participation in such underwriting and the inclusion of such
Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders
proposing to distribute their securities through such underwriting shall (together with the Company
and the other holders distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the underwriter or underwriters selected for such
underwriting by the Company. Notwithstanding any other provision of this Section 6, if the managing
underwriter determines that marketing factors require a limitation of the number of shares to be
underwritten, the managing underwriter may limit the number of Registrable Securities to be
included in the registration and underwriting, or may exclude Registrable Securities entirely from
such registration (provided that no shares held by officers and directors of the Company, other
than Registrable Securities that may be owned by officers and directors, are included in the
registration and underwriting). The Company shall so advise all Holders and the other Holders
distributing their securities through such underwriting pursuant to piggyback registration rights
similar to this Section 6, and the number of shares of Registrable Securities and other securities
that may be included in the registration and underwriting shall be allocated among all Holders and
other holders in proportion, as nearly as practicable, to the respective amounts of Registrable
Securities held by such Holders and other securities held by other holders at the time of filing
the registration statement. If any Holder disapproves of the terms of any such underwriting, he may
elect to withdraw therefrom by written notice to the Company and the managing underwriter. If, by
the withdrawal of such Registrable Securities, a greater number of Registrable Securities held by
other Holders may be included in such registration (up to the limit imposed by the underwriters),
the Company shall offer to all Holders who have included Registrable Securities in the registration
the

 

 

right to include additional Registrable Securities. Any Registrable Securities excluded or
withdrawn from such underwriting shall be withdrawn from such registration.

          7. Expenses of Registration. In addition to the fees and expenses contemplated by
Section 8 hereof, all expenses incurred in connection with all registrations pursuant to Section 5
or Section 6 hereof, including without limitation all registration, filing and qualification fees,
printing expenses, and all fees and disbursements of counsel for the Company and a any reasonable
fees for Holder (provided that any fees for Holder’s counsel shall be approved in writing in
advance if greater then $5,000), and expenses of any special audits of the Company’s financial
statements incidental to or required by such registration, shall be borne by the Company, except
that the Company shall not be required to pay underwriters’ fees, discounts or commissions relating
to Registrable Securities or fees of a separate legal counsel of a Holder other than the counsel
described above.

          8. Registration Procedures. In the case of each registration effected by the Company
pursuant to this Agreement, the Company will keep each Holder participating therein advised in
writing as to the initiation of each registration and as to the completion thereof. In addition, at
its expense the Company will:

               a. keep such registration pursuant to Section 5 continuously effective until all of the
securities covered by such registration statement have been sold pursuant to such registration
statement or all of the Registrable Securities covered by such registration statement may be sold
without registration under Rule 144 of the Securities Act;

               b. promptly prepare and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be necessary to
comply with the provisions of the Securities Act, and to keep such registration statement effective
for that period of time specified in Section 8(a) above;

               c. furnish such number of prospectuses and other documents incident thereto as a Holder from
time to time may reasonably request;

               d. use reasonable best efforts to obtain the withdrawal of any order suspending the
effectiveness of a registration statement, or the lifting of any suspension of the qualification of
any of the Registrable Securities for sale in any jurisdiction, at the earliest possible moment;

               e. register or qualify such Registrable Securities for offer and sale under the securities or
blue sky laws of such jurisdictions as any Holder or underwriter reasonably requires, and keep such
registration or qualification effective during the period set forth in Section 8(a) above;

               f. cause all Registrable Securities covered by such registrations to be listed or quoted on
each securities exchange, including the American Stock Exchange, on which similar securities issued
by the Company are then listed or quoted,

 

 

               g. enter into such customary agreements (including underwriting agreements in customary form)
and take all such other actions as the holders of a majority of the Registrable Securities being
sold or the underwriters, if any, reasonably, request in order to expedite or facilitate the
disposition of such Registrable Securities (including, without limitation, effecting a stock split
or a combination of shares);

               h. make available for inspection upon reasonable request by any seller of Registrable
Securities and any attorney, accountant or other agent retained by any such seller or underwriter,
all financial and other records, pertinent corporate documents and properties of the Company, and
cause the Company’s officers, directors, employees and independent accountants to supply all
information reasonably requested by any such seller, underwriter, attorney, accountant or agent in
connection with such registration statement;

               i. notify each Holder, at any time a prospectus covered by such registration statement is
required to be delivered under the Securities Act, of the happening of any event of which it has
knowledge as a result of which the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state a material fact required
to be stated therein or necessary to make the statements therein not misleading in the light of the
circumstances then existing;

               j. take such other actions as shall be reasonably requested by any Holder.

          9. Indemnification.

               a. In the event of a registration of any of the Registrable Securities under the Securities
Act pursuant to Section 5 or Section 6 of this Agreement, the Company will indemnify and hold
harmless each Holder of such Registrable Securities thereunder and each other person, if any, who
controls such Holder within the meaning of the Securities Act, against any losses, claims, damages
or liabilities, joint or several, to which such Holder, underwriter or controlling person may
become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in any registration statement under which
such Registrable Securities were registered under the Securities Act, any preliminary prospectus or
final prospectus contained therein, or any amendment or supplement thereof, or arise out of or are
based upon the omission or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, or any violation by the Company
of any rule or regulation promulgated under the Securities Act or any state securities law
applicable to the Company and relating to action or inaction required of the Company in connection
with any such registration, and will reimburse each such Holder, each of its officers, directors
and partners, and each person controlling such Holder, each such underwriter and each person who
controls any such underwriter, for any reasonable legal and any other expenses incurred in
connection with investigating, defending or settling any such claim, loss, damage, liability or
action, provided that the Company will not be liable in any such case to the extent that any such
claim, loss, damage or liability arises out of or is based on any

 

 

untrue statement or omission based upon written information furnished to the Company by an
instrument duly executed by such Holder or underwriter specifically for use therein.

               b. Each Holder will, if Registrable Securities held by or issuable to such Holder are included
in the securities as to which such registration is being effected, indemnify and hold harmless the
Company, each of its directors and officers, each underwriter, if any, of the Company’s securities
covered by such a registration statement, each person who controls the Company and each underwriter
within the meaning of the Securities Act, and each other such Holder, each of its officers,
directors and partners and each person controlling such Holder, against all claims, losses,
expenses, damages and liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in any such
registration statement, prospectus, offering circular or other document, or 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 will reimburse the Company, such Holders, such
directors, officers, partners, persons or underwriters for any reasonable legal or any other
expenses incurred in connection with investigating, defending or settling any such claim, loss,
damage, liability or action, in each case to the extent, but only to the extent, that such untrue
statement (or alleged untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to the Company by an instrument duly executed by such
Holder specifically for use therein; provided, however, the total amount for which any Holder, its
officers, directors and partners, and any person controlling such Holder, shall be liable under
this Section 9(b) shall not in any event exceed the aggregate proceeds received by such Holder from
the sale of Registrable Securities sold by such Holder in such registration.

               c. Each party entitled to indemnification under this Section 9 (the “Indemnified Party”) shall
give notice to the party required to provide indemnification (the “Indemnifying Party”) promptly
after such Indemnified Party has actual knowledge of any claims as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct
the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval
shall not be unreasonably withheld), and the Indemnified Party may participate in such defense at
such party’s expense, and provided further that the failure of any Indemnified Party to give notice
as provided herein shall not relieve the Indemnifying Party of its obligations hereunder, unless
such failure resulted in actual detriment to the Indemnifying Party. No Indemnifying Party, in the
defense of any such claim or litigation, shall, except with the consent of each Indemnified Party,
consent to entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a
release from all liability in respect of such claim or litigation.

               d. Notwithstanding the foregoing, to the extent that the provisions on indemnification
contained in the underwriting agreements entered into among the selling Holders, the Company and
the underwriters in connection with the underwritten public offering are in conflict with the
foregoing provisions, the provisions in the underwriting agreement shall be controlling as to the
Registrable Securities included in the public offering;

 

 

               e. If the indemnification provided for in this Section 9 is held by a court of competent
jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim,
damage or expense referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage or expense in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one hand and of the
indemnified party on the other hand in connection with the statements or omissions which resulted
in such loss, liability, claim, damage or expense as well as any other relevant equitable
considerations. The relevant fault of the indemnifying party and the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission. Notwithstanding
the foregoing, the amount any Holder shall be obligated to contribute pursuant to this Section 8(e)
shall be limited to an amount equal to the proceeds to such Holder of the Restricted Securities
sold pursuant to the registration statement which gives rise to such obligation to contribute (less
the aggregate amount of any damages which the Holder has otherwise been required to pay in respect
of such loss, claim, damage, liability or action or any substantially similar loss, claim, damage,
liability or action arising from the sale of such Restricted Securities).

               f. The indemnification provided by this Section 9 shall be a continuing right to
indemnification and shall survive the registration and sale of any securities by any Person
entitled to indemnification hereunder and the expiration or termination of this Agreement.

          10. Information by Holder. The Holder or Holders of Registrable Securities included
in any registration shall promptly furnish to the Company such information regarding such Holder or
Holders and the distribution proposed by such Holder or Holders as the Company may request in
writing and as shall be required in connection with any registration referred to herein.

          11. Rule 144 Reporting. With a view to making available to Holders of Registrable
Securities the benefits of certain rules and regulations of the SEC which may permit the sale of
the Registrable Securities to the public without registration, the Company agrees at all times to
file with the Commission all reports and other documents required of the Company under the
Securities Act and the Exchange Act.

          12. Transfer of Registration Rights. The rights to cause the Company to register
Registrable Securities of a Holder and keep information available granted to a Holder by the
Company under Section 5 or Section 6 of this Agreement may be assigned by a Holder to any partner
or shareholder of such Holder, to any other Holder, or to a transferee or assignee; provided, that
the Company is given written notice by the Holder at the time of or within a reasonable time after
said transfer, stating the name and address of said transferee or assignee and identifying the
securities with respect to which such registration rights are being assigned.

          13. Termination of Rights. The rights of any particular Holder to cause the Company
to register securities under Section 5 or Section 6 of this Agreement shall terminate with respect
to such Holder at such time that such Holder is able to dispose of all of such Holder’s

 

 

Registrable Securities (i) in one three-month period pursuant to the provisions of Rule 144,
provided that such Holder holds not more than one percent (1%) of the outstanding voting stock of
the Company, or (ii) otherwise pursuant to the provisions of Rule 144(k).

          14. Remedies upon Default or Delay. Without limitation of any other remedy available
to a Holder under applicable law or otherwise, if the Company shall (1) fail to register
Registrable Securities after it shall have been requested to do so by a Holder or otherwise
required to do so in accordance with Section 5 or Section 6 of this Agreement, or (2) fail to
perform any of its obligations hereunder and as a result of such failure Holders have not been able
to sell their Registrable Securities, or (3) act or fail to act in any manner such that one or more
Holders have been delayed in the sale of their Registrable Securities, which delay is not expressly
permitted by this Agreement, then any Holder adversely affected by such action, failure or delay
shall be entitled to the relief set forth in Section 5 or Section 6 above.

          15. Miscellaneous.

               a. Amendments. This Agreement may be amended only by a writing signed by the Holders
of more than fifty percent (50%) of the Registrable Securities, as constituted from time to time.
The Holders hereby consent to future amendments to this Agreement that permit future investors,
other than employees, officers or directors of the Company, to be made parties hereto and to become
Holders of Registrable Securities; provided, however, that no such future amendment may materially
impair the rights of the Holders hereunder without obtaining the requisite consent of the Holders,
as set forth above. For purposes of this Section, Registrable Securities held by the Company or
beneficially owned by any officer or employee of the Company shall be disregarded and deemed not to
be outstanding.

               b. Counterparts. This Agreement may be executed in any number of counterparts, all of
which shall constitute a single instrument.

               c. Notices, Etc. All notices and other communications required or permitted hereunder
shall be in writing and may be sent initially by facsimile transmission and shall be mailed by
registered or certified mail, postage prepaid, or otherwise delivered by hand or by messenger,
addressed to the addresses set forth in the Settlement Agreement. Each such notice or other
communication shall for all purposes of this Agreement be treated as effective or having been given
when delivered if delivered personally, or, if sent by first class, postage prepaid mail, at the
earlier of its receipt or seventy-two (72) hours after the same has been deposited in a regularly
maintained receptacle for the deposit of the United States mail, addressed and mailed as aforesaid.

               d. Severability. If any provision of this Agreement shall be held to be illegal,
invalid or unenforceable, such illegality, invalidity or unenforceability shall attach only to such
provision and shall not in any manner affect or render illegal, invalid or unenforceable any other
provision of this Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.

               e. Governing Law. This Agreement shall be governed by and construed under the laws of
the State of New York without regard to principles of conflict of law.

 

 

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

	 	 	 	 	 
	 	THE COMPANY:

ZBB ENERGY CORPORATION

 	 
	 	By:  	
 	 
	 	 	Robert Parry 	 
	 	 	Chief Executive Officer 	 
	 
	 	THE INVESTOR:

ABS SOS-PLUS PARTNERS, LTD.

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 
	 	 	Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00128-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00128-of-00352.parquet"}]]