AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 17, 2001
REGISTRATION NO. 333-____________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
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REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
ULTRALIFE BATTERIES, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 16-387013
(State or Other Jurisdiction (I.R.S. Employer Identification Number)
of Incorporation or Organization)
2000 Technology Parkway
Newark, New York 14513
(315) 332-7100
(Address, including Zip Code, and Telephone Number, including Area Code,
of Registrant's Principal Executive Offices)
--------------------
John D. Kavazanjian
President and Chief Executive Officer
Ultralife Batteries, Inc.
2000 Technology Parkway
Newark, New York 14513
(315) 332-7100
(Name, Address, including Zip Code, and Telephone Number,
including Area Code, of Agent for Service)
--------------------
Copy to:
Jeffrey H. Bowen, Esq.
Harter, Secrest & Emery LLP
1600 Bausch & Lomb Place
Rochester, New York 14604
(716) 232-6500
Approximate date of commencement of proposed sale to the public: From time
to time after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered to
dividend or interest reinvestment plans, please check the following box. [ ]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
====================================================================================================================================
Title of Shares Amount Proposed Maximum Proposed Maximum Aggregate Amount
to Be Registered to Be Registered Offering Price Per Unit (1) Offering Price (1) of Registration Fee(3)
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Common Stock, $.10 par value 1,090,000 shares $6.05 $6,594,500.00 $1,648.63
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Common Stock issuable upon 109,000 shares(2) $6.25 $681,250.00 $170.31
exercise of Warrants
====================================================================================================================================
(1) The price of $6.05, which was the average of the high and low sale prices
of the Common Stock on the Nasdaq National Market System on August 13,
2001, is set forth solely for the purpose of computing the registration
fee pursuant to Rule 457(c). The price of $6.25 is the exercise price of
the warrants and is set forth solely for the purpose of computing the
registration fee pursuant to Rule 457(g).
(2) Shares issuable upon exercise of warrants issued to the Company's
placement agent, H.C. Wainwright & Co., Inc., and certain of its
affiliates at an exercise price of $6.25 per share in connection with the
private placement of 1,090,000 shares of restricted stock at $6.25 per
share.
(3) Calculated pursuant to Rule 457(c) and Rule 457(g).
In accordance with Rule 416(a), this Registration Statement shall cover
any additional securities that may be issued in connection with the terms of the
securities which provide for a change in the amount of securities being issued
to prevent dilution resulting from stock splits, stock dividends or similar
transactions.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
PROSPECTUS
1,199,000 SHARES
ULTRALIFE BATTERIES, INC.
COMMON STOCK
--------------------
This Prospectus relates to the public offering of 1,199,000 shares of our
Common Stock, par value $.10 per share. Of the total 1,199,000 shares, 1,090,000
of such shares are being registered for the accounts of the selling stockholders
identified in Table A in the section titled "Selling Stockholders". The
remaining 109,000 of such shares are being registered for the accounts of future
stockholders who will receive their shares upon the exercise of the warrants
held by those parties identified in Table B in the Section titled "Selling
Stockholders". This offering will not be underwritten. All 1,199,000 shares may
be offered by certain of our stockholders or by pledgees, donees, transferees or
other successors in interest who receive the shares as a gift, partnership
distribution or other non-sale related transfer. Of the shares being registered,
1,090,000 of such shares were originally issued in a private transaction
pursuant to that certain Share Purchase Agreement dated July 19, 2001 by and
among the Company and subscribers identified in Table A in the section of this
Prospectus entitled "Selling Stockholders". The issuance of these shares was
exempt from registration under Section 4(2) of the Securities Act of 1933, as
amended, and Regulation D. We are registering the shares pursuant to Section 7.1
of the Share Purchase Agreement. The remaining 109,000 shares are subject to
future issuance upon the exercise of warrants granted to our placement agent,
H.C. Wainwright & Co., Inc. and several of its affiliates, pursuant to that
certain Warrant Agreement dated as of July 20, 2001 by and among the Company,
H.C. Wainwright and its affiliates. We are registering these shares in
accordance with the provisions of that Warrant Agreement.
The shares we are registering may be offered by the selling stockholders
(including those holding stock as a result of the future exercise of the
warrants) from time to time in transactions in the over-the-counter market, in
negotiated transactions, or in a combination of such methods of sale. The shares
may be offered at fixed prices that may be changed, at market prices prevailing
at the time of sale, at prices related to prevailing market prices or at
negotiated prices. The selling stockholders (including those holding stock as a
result of the future exercise of the warrants) may effect such transactions by
selling the shares to or through broker-dealers, and such broker-dealers may
receive compensation in the form of discounts, concessions or commissions from
the selling stockholders (including those holding stock as a result of the
future exercise of the warrants) and/or the purchasers of the shares for whom
such broker-dealers act as agents or to whom they sell as principals, or both.
This compensation might be in excess of customary commissions. For further
information, see the section entitled "Plan of Distribution" below.
We will not receive any of the proceeds from the sale of these shares.
However, to the extent the warrants are exercised through payment of the
exercise price in cash, rather than a cashless exercise, we will receive the
proceeds of those exercises. We have agreed to bear certain expenses in
connection with the registration of the shares being offered and sold by the
selling stockholders (including those holding stock as a result of the future
exercise of the warrants). Our Common Stock is quoted on the Nasdaq National
Market under the symbol "ULBI." On August 13, 2001, the last reported sale price
for the Common Stock was $6.05.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
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This offering of our Common Stock involves certain risks. For further
information, please see the section entitled "Risk Factors".
The date of this Prospectus is August ___, 2001
Table of Contents
Page
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Prospectus Summary 3
Risk Factors 3
Forward-Looking Statements 7
Use of Proceeds 8
Selling Stockholders 8
Plan of Distribution 11
Legal Matters 12
Experts 12
Where You Can Find More Information 12
Incorporation of Information by Reference 13
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PROSPECTUS SUMMARY
This summary highlights selected information and does not contain all of
the information that is important to you. We urge you to read the entire
Prospectus carefully and any information contained in or incorporated by
reference in this Prospectus before you decide whether to buy our Common Stock.
You should pay special attention to the risks of investing in our Common Stock
discussed under Risk Factors below. Unless the context otherwise requires,
references in this Prospectus to Ultralife, we, us, and our refer to Ultralife
Batteries, Inc. and our subsidiaries.
Ultralife
We develop, manufacture and market a wide range of standard and customized
primary and rechargeable lithium batteries for use in a wide array of
applications and markets, including military, automotive telematics, safety and
medical, and computers and communications. We believe that our proprietary
technologies allow us to offer batteries that are ultra-thin, light weight and
that generally achieve greater operating performance than other batteries
currently available. We sell our products directly to original equipment
manufacturers in the United States and abroad and have contractual arrangements
with sales representatives who market our products on a commission basis in
particular areas. We also distribute our products to domestic and international
distributors and retailers that purchase our batteries for resale. We have
obtained ISO 9001 certification for our lithium batteries manufacturing
operations in Newark, New York and Abingdon, England. As of June 30, 2001, we
had approximately 455 employees worldwide.
We were formed in December 1990 as a Delaware corporation. In March 1991,
we acquired certain technology and assets from Eastman Kodak Company relating to
its 9-volt lithium manganese dioxide primary battery and in June 1994, as a
result of the formation of our United Kingdom subsidiary and acquisition of
certain battery-related assets, acquired a presence in Europe. In December 1998,
we announced a joint venture to produce our polymer rechargeable batteries in
Taiwan.
Our principal executive office is located at 2000 Technology Parkway,
Newark, New York 14513. Our telephone number is (315) 332-7100.
RISK FACTORS
An investment in shares of Common Stock offered hereby involves a high
degree of risk. The following risk factors should be considered carefully in
addition to the other information in this Prospectus before purchasing the
Common Stock offered by this Prospectus. The following factors could cause
actual results to differ materially from the matters described in the
forward-looking statements, with material and adverse effects on the Company's
business, operating results, financial condition and the value of Ultralife
stock.
History of Operating Losses; Uncertainty of Future Profitability
We began operating our company in March 1991. During each year since 1991,
we have had net operating losses. These losses have resulted mainly from the
cost of researching, developing and manufacturing our products and general and
administrative costs associated with operating our company. We cannot assure
that we will generate an operating profit or achieve profitability in the
future.
Uncertainty of Market Acceptance of Advanced Rechargeable Batteries
Although we have begun volume production of our rechargeable batteries,
our advanced rechargeable batteries have not yet achieved wide acceptance in the
market. We cannot assure that a
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market will ever accept our advanced rechargeable batteries. The introduction of
new products is subject to the inherent risks of unforeseen delays and the time
necessary to achieve market success for any individual product is uncertain. If
volume production and/or market penetration of our advanced rechargeable
batteries is delayed for any reason, our competitors may introduce emerging
technologies or improve existing technologies which could have a material
adverse effect on our business, financial condition and results of operations.
Dependence on OEM Relationships and their products for Sale of Advanced
Rechargeable Batteries
We will continue to promote market demand for, and awareness of, our
advanced rechargeable batteries. We will accomplish this partly through the
development of relationships with OEMs that manufacture products which require
the performance characteristics of our advanced rechargeable batteries. The
success of any such relationship depends upon the general business condition of
the OEM and our ability to produce our advanced rechargeable batteries at the
quality and cost and within the period required by such OEMs. Our failure to
develop a sufficient number of relationships with OEMs could have a material
adverse effect on our business, financial condition and results of operations.
A substantial portion of our business will depend upon the success of
products sold by OEMs that use our batteries. Therefore, our success is
substantially dependent upon the acceptance of the OEMs' products in the
marketplace. We are subject to many risks beyond our control that influence the
success or failure of a particular product manufactured by an OEM, including,
competition faced by the OEM in its particular industry; market acceptance of
the OEM's product; the engineering, sales, marketing and management capabilities
of the OEM; technical challenges unrelated to our technology or products faced
by the OEM in developing its products; and, the financial and other resources of
the OEM.
Risks Relating to Growth and Expansion
Rapid growth of our advanced rechargeable battery business or other
segments of our business may significantly strain our management, operations and
technical resources. If we are successful in obtaining rapid market growth of
our advanced rechargeable batteries, we will be required to deliver large
volumes of quality products to our customers on a timely basis at a reasonable
cost to those customers. We cannot assure, however, that our business will
rapidly grow or that our efforts to expand our manufacturing and quality control
activities will be successful or that we will be able to satisfy commercial
scale production requirements on a timely and cost-effective basis. We will also
be required to continue to improve our operations, management and financial
systems and controls. Our failure to manage our growth effectively could have an
adverse effect on our business, financial condition and results of operations.
Competition; Technological Obsolescence
The primary and rechargeable battery industry is characterized by intense
competition with a large number of companies offering or seeking to develop
technology and products similar to ours. We are subject to competition from
manufacturers of traditional rechargeable batteries, such as nickel-cadmium
batteries, from manufacturers of rechargeable batteries of more recent
technologies, such as nickel-metal hydride, lithium-ion liquid electrolyte and
lithium-ion solid-polymer batteries, as well as from companies engaged in the
development of batteries incorporating new technologies. Manufacturers of
nickel-cadmium and nickel-metal hydride batteries include Eveready, Sanyo
Electric Co. Ltd., Sony Corp., Toshiba Corp., Matsushita Electric Industrial
Co., Ltd. and Duracell International, Inc. Manufacturers of lithium-ion liquid
electrolyte batteries currently include Saft-Soc des ACC, Sony Corp., Toshiba
Corp., Matsushita Electric Industrial Co., Ltd., Sanyo Electric Co. Ltd. and
Duracell International, Inc. Valence Technology, Inc., Lithium Technology
Corporation, and Yuasa-Exide, Inc. have developed prototype solid-polymer
batteries and are constructing commercial-scale manufacturing facilities. We
also compete with large and small manufacturers of alkaline, carbon-zinc,
seawater, high rate and primary batteries as well as other manufacturers of
lithium batteries. We cannot assure that we
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will successfully compete with these manufacturers, many of which have
substantially greater financial, technical, manufacturing, distribution,
marketing, sales and other resources. Many companies with substantially greater
resources than ours are developing a variety of battery technologies, including
liquid electrolyte lithium and solid electrolyte lithium batteries, which are
expected to compete with our technology. Other companies undertaking research
and development activities of solid-polymer batteries have already developed
prototypes and are constructing commercial scale production facilities. If these
companies successfully market their batteries before the introduction of our
products, there could be a material adverse effect on our business, financial
condition and results of operations. The market for our products is
characterized by changing technology and evolving industry standards, often
resulting in product obsolescence or short product lifecycles. Although we
believe that our batteries, particularly our 9-volt and advanced rechargeable
batteries, are comprised of state-of-the-art technology, there can be no
assurance that competitors will not develop technologies or products that would
render our technology and products obsolete or less marketable.
Dependence on Key Personnel
Because of the specialized, technical nature of our business, we are highly
dependent on certain members of our management, marketing, engineering and
technical staff. If we lose the services or these members, this could have a
material adverse effect on our business, financial condition and results of
operations. In addition to developing manufacturing capacity so that we can
produce high volumes of our advanced rechargeable batteries, we must attract,
recruit and retain a sizeable workforce of technically competent employees. Our
ability to pursue effectively our business strategy will depend upon, among
other factors, the successful recruitment and retention of additional highly
skilled and experienced managerial, marketing, engineering and technical
personnel. We cannot assure that we will be able to retain or recruit this type
of personnel.
Safety Risks; Demands of Environmental and Other Regulatory Compliance
Components of our batteries contain certain elements that are known to pose
safety risks. Our primary battery products incorporate lithium metal, which when
it reacts with water may cause fires if not handled properly. In addition to a
December 1996 fire at our Abingdon, England facility, a fire occurred August
1997 at our Newark, New York facility and fires occurred in July 1994 and
September 1995 at our Abingdon, England facility, each of which temporarily
interrupted certain manufacturing operations in a specific area of these
facilities. Although we incorporate safety procedures in our research,
development and manufacturing processes that are designed to minimize safety
risks, we cannot assure that more accidents will not occur. Although we
currently carry insurance policies which cover loss of our plant and machinery,
leasehold improvements, inventory and business interruption, any accident,
whether at our manufacturing facilities or from the use of our products, may
result in significant production delays or claims for damages resulting from
injuries. These types of losses could have a material adverse effect on our
business, financial condition and results of operations.
National, state and local laws impose various environmental controls on the
manufacture, storage, use and disposal of lithium batteries and/or of certain
chemicals used in the manufacture of lithium batteries. Although we believe that
our operations are in substantial compliance with current environmental
regulations and that, except as noted below, there are no environmental
conditions that will require material expenditures for clean-up at our present
or former facilities or at facilities to which it has sent waste for disposal,
there can be no assurance that changes in such laws and regulations will not
impose costly compliance requirements on we or otherwise subject it to future
liabilities. Moreover, state and local governments may enact additional
restrictions relating to the disposal of lithium batteries used by our customers
which could have a material adverse effect on our business, financial condition
and results of operations. In addition, the U.S. Department of Transportation
and certain foreign regulatory agencies that consider lithium to be a hazardous
material regulate the transportation of batteries which contain lithium metal.
We currently ship our lithium batteries in accordance with regulations
established by the U.S. Department of Transportation. There can be no assurance
that additional or modified regulations relating to the manufacture,
transportation, storage, use and disposal of materials used to
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manufacture our batteries or restricting disposal of batteries will not be
imposed or how these regulations will affect us or our customers.
In connection with our purchase/lease of our Newark, New York facility in
1998, a consulting firm performed a Phase I and II Environmental Site Assessment
which revealed the existence of contaminated soil and ground water around one of
our buildings. We retained an engineering firm which estimated that the cost of
remediation should be in the range of $230,000. This cost, however, is merely an
estimate and the cost may in fact be much higher. In February 1998, we entered
into an agreement with a third party which provides that we and this third party
will retain an environmental consulting firm to conduct a supplemental Phase II
investigation to verify the existence of the contaminants and further delineate
the nature of the environmental concern. The third party agreed to reimburse us
for fifty percent of the cost of correcting the environmental concern on the
Newark property. We cannot assure that we will not face claims resulting in
substantial liability which would have a material adverse effect on our
business, financial condition and results of operations in the period in which
such claims are resolved.
Limited Sources of Supply
Certain materials we use in our products are available only from a single
or a limited number of suppliers. Additionally, we may elect to develop
relationships with a single or limited number of suppliers for materials that
are otherwise generally available. Although we believe that alternative
suppliers are available to supply materials that could replace materials
currently used by us and that, if necessary, we would be able to redesign our
products to make use of such alternatives, any interruption in our supply from
any supplier that serves as our sole source could delay product shipments and
have a material adverse effect on our business, financial condition and results
of operations. Although we have experienced interruptions of product deliveries
by sole source suppliers, these interruptions have not had a material adverse
effect on our business, financial condition and results of operations. We cannot
guarantee that we will not experience a material interruption of product
deliveries from sole source suppliers.
Dependence on Proprietary Technologies
Our success depends more on the knowledge, ability, experience and
technological expertise of our employees than on the legal protection of our
patents and other proprietary rights. We claim proprietary rights in various
unpatented technologies, know-how, trade secrets and trademarks relating to our
products and manufacturing processes. We cannot guarantee the degree of
protection these various claims may or will afford, or that our competitors will
not independently develop or patent technologies that are substantially
equivalent or superior to our technology. We protect our proprietary rights in
our products and operations through contractual obligations, including
nondisclosure agreements with certain employees, customers, consultants and
strategic partners. There can be no assurance as to the degree of protection
these contractual measures may or will afford. We, however, have had patents
issued and patent applications pending in the U.S. and elsewhere. We cannot
assure (i) that patents will be issued from any pending applications, or that
the claims allowed under any patents will be sufficiently broad to protect our
technology, (ii) that any patents issued to us will not be challenged,
invalidated or circumvented, or (iii) as to the degree or adequacy of protection
any patents or patent applications may or will afford. If we are found to be
infringing third party patents, there can be no assurance that we will be able
to obtain licenses with respect to such patents on acceptable terms, if at all.
Our failure to obtain necessary licenses could delay product shipment or the
introduction of new products, and costly attempts to design around such patents
could foreclose the development, manufacture or sale of our products.
Dependence on Technology Transfer Agreements
Our research and development of advanced rechargeable battery technology
and products utilizes internally-developed technology, acquired technology and
certain patents and related technology licensed by us pursuant to non-exclusive,
technology transfer agreements. There can be no assurance that our competitors
will not develop, independently or through the use of similar technology
transfer agreements,
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rechargeable battery technology or products that are substantially equivalent or
superior to the technologies and products currently under research and
development by us.
Risks Related to China Joint Venture Program
In July 1992, we entered into several agreements related to the
establishment of a manufacturing facility in Changzhou, China, for the
production and distribution in and from China of 2/3A lithium primary batteries.
Changzhou Ultra Power Battery Co., Ltd., a company organized in China ("China
Battery"), purchased from us certain technology, equipment, training and
consulting services relating to the design and operation of a lithium battery
manufacturing plant. China Battery was required to pay approximately $6.0
million to us over the first two years of the agreement, of which approximately
$5.6 million has been paid. We have been attempting to collect the balance due
under this contract. China Battery has indicated that it will not make these
payments until certain contractual issues have been resolved. Due to China
Battery's questionable willingness to pay, we wrote off in fiscal 1997 the
entire balance owed to us as well as our investment aggregating $805,000. Since
China Battery has not purchased technology, equipment, training or consulting
services from us to produce batteries other than 2/3 A lithium batteries, we do
not believe that China Battery has the capacity to become our competitor. We do
not anticipate that the manufacturing or marketing of 2/3 A lithium batteries
will be a substantial portion of our product line in the future. However, in
December 1997, China Battery sent to us a letter demanding reimbursement of an
unspecified amount of losses they have incurred plus a refund for certain
equipment that we sold to China Battery. We have attempted to initiate
negotiations to resolve the dispute. However, an agreement has not yet reached.
Although China Battery has not taken any additional steps, there can be no
assurance that China Battery will not further pursue such a claim which, if
successful, would have a material adverse effect on our business, financial
condition and results of operations. We believe that such a claim is without
merit.
Ability to Insure Against Losses
Because certain of our primary batteries are used in a variety of security
and safety products and medical devices, we may be exposed to liability claims
if such a battery fails to function properly. We maintain what we believe to be
sufficient liability insurance coverage to protect against potential claims;
however, there can be no assurance that the liability insurance will continue to
be available, or that any such liability insurance would be sufficient to cover
any claim or claims.
Possible Volatility of Stock Price
Future announcements concerning us or our competitors, including
technological innovations or commercial products, litigation or public concerns
as to the safety or commercial value of one or more of our products, may cause
the market price of our Common Stock to fluctuate substantially for reasons
which may be unrelated to operating results. These fluctuations, as well as
general economic, political and market conditions, may have a material adverse
effect on the market price of our Common Stock.
FORWARD-LOOKING STATEMENTS
This Prospectus, including information contained in documents that are
incorporated by reference in this Prospectus, contains forward-looking
statements, as that term is defined by federal securities laws, that relate to
the financial condition, results of operations, plans, objectives, future
performance and business of Ultralife. These statements are frequently preceded
by, followed by or include the words believes, expects, anticipates, estimates
or similar expressions. We have based these forward-looking statements on our
current expectations and projections about future events. The statements
contained in this Prospectus relating to matters that are not historical facts
are forward-looking statements that involve risks and uncertainties, including
future demand for our products and services, the successful commercialization of
our advanced rechargeable batteries, general economic conditions, government and
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environmental regulation, competition and customer strategies, technological
innovations in the primary and rechargeable battery industries, changes in our
business strategy or development plans, capital deployment, business
disruptions, including those caused by fire, raw materials, supplies and other
risks and uncertainties, certain of which are beyond our control. In addition to
these risks, in the section of this Prospectus entitled Risk Factors, we have
summarized a number of the risks and uncertainties that could affect the actual
outcome of the forward-looking statements included in this Prospectus. We advise
you not to place undue reliance on these forward-looking statements in light of
the material risks and uncertainties to which they are subject. Should one or
more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may differ materially from those
described herein as anticipated, believed, estimated or expected. We undertake
no obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares of
Common Stock by the selling stockholders. To the extent, however, that the
warrants are exercised through payment of the exercise price in cash, rather
than a cashless exercise, we will receive the proceeds of those exercises. We
have agreed to bear all expenses, other than selling commissions and fees and
expenses of counsel and other advisors to the selling stockholders, in
connection with the registration of the shares being offered.
SELLING STOCKHOLDERS
The following Table A sets forth the number of shares of Common Stock
owned by each of the selling stockholders who subscribed for shares of our
Common Stock in our recent private placement. None of these selling stockholders
has had a material relationship with us within the past three years other than
as a result of the ownership of our Common Stock. Because the selling
stockholders may offer all or some of the Common Stock which they hold pursuant
to the offering contemplated by this Prospectus, and because there are currently
no agreements, arrangements or understandings with respect to the sale of any of
the shares, no estimate can be given as to the amount of shares that will be
held by the selling stockholders after completion of this offering. The shares
offered by this Prospectus may be offered from time to time by the selling
stockholders named below or by pledgees, donees, transferees or other successors
in interest who receive the shares as a gift, partnership distribution or other
non-sale related transfer.
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Table A
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Number of
Number of Shares
Shares Number of Beneficially Percent of
Beneficially Shares Owned After Outstanding
Owned Prior Registered Completion Shares after
to Completion for Sale of the Completion of
Name of Selling Stockholder of the Offering Hereby (1) Offering the Offering
- -----------------------------------------------------------------------------------------------------
First Trust as trustee for 22,000 22,000 0 *
Sheila Baird SERP
Weiss, Peck & Greer as trustee for 10,000 10,000 0 *
Sheila Baird IRA
Weiss, Peck & Greer as trustee for 28,000 16,000 12,000 *
Murray Berliner Sep IRA
Weiss, Peck & Greer as trustee for 5,500 4,000 1,500 *
Stephan Bermas IRA
William A. Birnbaum 22,500 16,000 6,500 *
William Birnbaum and Kathleen 22,500 16,000 6,500 *
Birnbaum
Harris J. Bixler 21,000 16,000 5,000 *
Weiss, Peck & Greer as trustee for 8,000 4,000 4,000 *
John V. Brennan IRA
Weiss, Peck & Greer as trustee for 8,000 8,000 0 *
Julie Connelly IRA
Katharine Crossgrove 13,000 8,000 5,000 *
Daeg Partners, LLP 574,500 92,000 482,500 3.93%
Donna Darnell 7,500 4,000 3,500 *
Tirone E. David, M.D 25,000 12,000 13,000 *
Weiss, Peck & Greer as trustee for 17,000 8,000 9,000 *
John W. Dewey, IRA
Weiss, Peck & Greer as trustee for 18,000 8,000 10,000 *
John Dorman IRA
Weiss, Peck & Greer as trustee for 14,500 8,000 6,500 *
Joan Ellenbogen IRA
Weiss, Peck & Greer as trustee for 9,500 4,000 5,500 *
Marcia Goldstein IRA
Martha Grant 14,000 8,000 6,000 *
Claire S. Gulamerian, Living Trust 16,600 8,000 8,600 *
dtd 6/7/96
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Number of
Number of Shares
Shares Number of Beneficially Percent of
Beneficially Shares Owned After Outstanding
Owned Prior Registered Completion Shares after
to Completion for Sale of the Completion of
Name of Selling Stockholder of the Offering Hereby (1) Offering the Offering
- -----------------------------------------------------------------------------------------------------
Ingolstadt Ltd. BVI 26,000 16,000 10,500 *
Oscar Lascano 9,000 4,000 5,000 *
Weiss, Peck & Greer as trustee for 9,600 4,000 5,600 *
Stanley Mailman IRA
Barbara V. May 5,200 4,000 1,200 *
Weiss, Peck & Greer as trustee for 18,800 16,000 2,800 *
Bernadette Murphy IRA
Joan Nazarro 8,000 4,000 4,000 *
1004050 Ontario Inc. 9,000 4,000 5,000 *
Arthur Panoff 9,300 8,000 1,300 *
Patricia C. Remmer, Revocable Trust 31,000 16,000 15,000 *
dtd 7/22/92
Patricia C. Remmer, 1995 Charitable 10,000 4,000 6,000 *
Lead Trust
The Remmer Family Foundation 8,000 4,000 4,000 *
Weiss, Peck & Greer as trustee for 19,000 8,000 11,000 *
Dorothy Rivkin IRA
Maurice Schlossberg and Amy 5,000 8,000 5,000 *
Schlossberg
Weiss, Peck & Greer as trustee for 7,000 4,000 3,000 *
Mary Simons IRA
Weiss, Peck & Greer as trustee for 22,000 16,000 6,000 *
Richard R. Stebbins
Sarah Tough 9,000 4,000 5,000 *
Weiss, Peck & Greer as trustee for 11,000 4,000 7,000 *
Leon Zeff IRA
Charles W. Phillips 10,000 10,000 0 *
Richard F. Morton 15,000 5,000 10,000 *
Neal P. Brooks 38,000 5,000 33,000 *
State of Wisconsin Investment Board 2,218,600 670,000 1,548,600 12.63%
Total 3,355,600 1,090,000 2,273,600 18.54%
- -------------
* Represents beneficial ownership of less than 1%.
- 10 -
(1) This Registration Statement shall also cover any additional shares of our
Common Stock which become issuable in connection with the Common Stock
registered for sale hereby by reason of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt of
consideration which results in an increase in the number of our outstanding
shares of Common Stock.
The following Table B sets forth the number of shares of Common Stock to
be owned upon exercise of the warrants issued to H.C. Wainwright & Co., Inc. and
several of its affiliates as partial compensation for its services as placement
agent in connection with our private placement. The warrantholders have
confirmed to us that none had agreements or understandings, directly or
indirectly, with any person to distribute the Common Stock issuable upon
exercise of the warrants. Because the warrantholders or subsequent selling
stockholders may offer all or some of the Common Stock which they hold pursuant
to the offering contemplated by this Prospectus, and because there are currently
no agreements, arrangements or understandings with respect to the sale of any of
the shares, no estimate can be given as to the amount of shares that will be
held by the warrantholders or subsequent selling stockholders after completion
of this offering. The shares offered by this Prospectus may be offered from time
to time by the warrant holders or subsequent selling stockholders or by
pledgees, donees, transferees or other successors in interest who receive the
shares as a gift, partnership distribution or other non-sale related transfer.
Table B
-------
Number of Number of
Shares Shares
Beneficially Beneficially
Owned Number of Owned
Prior to Shares after
Completion Registered Completion Percent of
of the for Sale of the Outstanding
Name of Selling Stockholder Offering Hereby (1) Offering(2) Shares(2)
- ----------------------------------------------------------------------------------------
Eric Singer 38,900 38,900 0 *
Matthew Balk 5,000 5,000 0 *
Jason Adelman 5,000 5,000 0 *
Scott Weisman 5,600 5,600 0 *
H.C. Wainright & Co., Inc. 54,500 54,500 0 *
Total 109,000 109,000 0 *
* Represents beneficial ownership of less than 1%.
(1) This Registration Statement shall also cover any additional shares of our
Common Stock which become issuable in connection with the Common Stock
registered for sale hereby by reason of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt of
consideration which results in an increase in the number of our outstanding
shares of Common Stock.
(2) This figure includes the shares that will be issued upon exercise of the
warrants by such selling stockholder.
- 11 -
PLAN OF DISTRIBUTION
We will receive no proceeds from this offering. The shares offered by this
Prospectus may be sold by the selling stockholders (including those holding
stock as a result of the future exercise of the warrants) from time to time in
transactions in the over-the-counter market, in negotiated transactions, or in a
combination of such methods of sale, at fixed prices which may be changed, at
market prices prevailing at the time of sale, at prices related to prevailing
market prices or at negotiated prices. The selling stockholders (including those
holding stock as a result of the future exercise of the warrants) may effect
such transactions by selling the shares to or through broker-dealers, and such
broker-dealers may receive compensation in the form of discounts, concessions or
commissions from the selling stockholders (including those holding stock as a
result of the future exercise of the warrants) and/or the purchasers of the
shares for whom such broker-dealers may act as agents or to whom they sell as
principals, or both. This compensation might be in excess of customary
commissions. The shares we are offering may be sold either pursuant to this
Registration Statement or pursuant to Rule 144 issued by the SEC under the
Securities Act of 1933.
In order to comply with the securities laws of certain states, if
applicable, the shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.
The selling stockholders (including those holding stock as a result of the
future exercise of the warrants) and any broker-dealers or agents that
participate with the selling stockholders (including those holding stock as a
result of the future exercise of the warrants) in the distribution of the shares
may be deemed to be "underwriters" within the meaning of the Securities Act of
1933, and any commissions received by them and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under federal law.
Under applicable federal rules and regulations, any person engaged in the
distribution of our Common Stock may not simultaneously engage in market making
activities with respect to our Common Stock for a period of two business days
prior to the commencement of such distribution. In addition, and without
limiting the foregoing, each selling stockholder will be subject to applicable
provisions of the Securities Exchange Act of 1934 and the rules and regulations
of the SEC promulgated thereunder. These rules include, without limitation,
Rules 10b-6 and 10b-7, which may limit the timing of purchases and sales of
shares of our Common Stock by the selling stockholders (including those holding
stock as a result of the future exercise of the warrants).
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon for us
by Harter, Secrest & Emery LLP, Rochester, New York.
EXPERTS
Our consolidated balance sheets as of June 30, 1999 and June 30, 2000 and
our consolidated statements of income, retained earnings, and cash flows for
each of the three years in the period ended June 30, 2000 incorporated by
reference in this prospectus and elsewhere in the registration statement have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their reports with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in accounting and auditing
in giving said reports.
WHERE YOU CAN FIND MORE INFORMATION
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus in connection with
this offering of our Common Stock. If any such information or representations
are given or made, such information or representations must not be relied
- 12 -
upon as having been authorized by us, by any selling stockholder or by any
other person. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that
information herein is correct as of any time subsequent to the date hereof. This
Prospectus does not constitute an offer to sell or a solicitation of an offer to
buy any security other than the Common Stock covered by this Prospectus, nor
does it constitute an offer to or solicitation of any person in any jurisdiction
in which such offer or solicitation may not lawfully be made.
We are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended. As a result, we file reports, proxy
statements, information statements and other information with the Securities and
Exchange Commission (the "SEC"). You may inspect and copy any reports, proxy
statements and other information that we file at the Public Reference Room
maintained by the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. You can
obtain copies of such materials by mail from the Public Reference Room of the
SEC at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed
rates and at the Commission's regional offices in New York City, 75 Park Place,
Room 1400, New York, New York 10007 and Chicago, Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. You may obtain information
on the operation of the Public Reference Room by calling the SEC at
1-800-SEC-0330. The SEC maintains a World Wide Web site that contains reports,
proxy and information statements and other information regarding registrants
that file electronically with the SEC. The address of the SEC's web site is
http://www.sec.gov. Our Common Stock is quoted on the Nasdaq National Market,
and such material may also be inspected at the offices of Nasdaq Operations,
1735 K Street N.W. Washington, D.C. 20006.
We have filed with the SEC a Registration Statement on Form S-3 (together
with all amendments and exhibits, referred to in this Prospectus as the
"Registration Statement") under the Securities Act of 1933 with respect to the
Common Stock we are offering. This Prospectus does not contain, nor is it
required to contain, all of the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the SEC. For further information regarding us and our Common
Stock, you should refer to the Registration Statement and its exhibits and
schedules. The Registration Statement, including its exhibits and schedules, may
be inspected as described above.
INCORPORATION OF INFORMATION BY REFERENCE
The following documents filed with the SEC pursuant to the Securities
Exchange Act of 1934 are incorporated herein by reference:
1. Our Annual Report on Form 10-K for the fiscal year ended June 30, 2000,
filed September 27, 2000;
2. Our Quarterly Reports on Form 10-Q for the quarters ended September 30,
2000, December 31, 2000 and March 31, 2001;
3. Our Form S-8 filed on May 15, 2001;
4. Our Forms 8-K filed on July 12, 2001 and July 24, 2001;
5. Our Form 14A filed on October 30, 2000;
6. The description of our Common Stock, par value $.10 per share,
contained in our Registration Statement on Form S-1 filed on December 23, 1992
(Registration No. 33-54470), including any amendment or report filed for the
purpose of updating such description; and
7. All reports and other documents filed by us pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 subsequent to the date
of this Prospectus and prior to the termination of this offering.
Any statement contained in a document incorporated by reference herein
shall be deemed to be incorporated by reference in this Prospectus and to be
part hereof from the date of filing of such
- 13 -
documents. Any statement modified or superseded shall not be deemed, except as
so modified or superseded, to constitute a part of this Prospectus. We will
provide to you upon written or oral request and without charge a copy of any or
all of such documents which are incorporated herein by reference (other than
exhibits to such documents unless such exhibits are specifically incorporated by
reference into the documents that this Prospectus incorporates). Written or oral
requests for copies (at no cost to requestor) should be directed to our
Secretary, at our principal executive offices: Ultralife Batteries, Inc., 2000
Technology Parkway, Newark, New York 14513. Our telephone number is (315)
332-7100.
- 14 -
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by Ultralife Batteries, Inc.
(the "Company") in connection with the sale of Common Stock being registered.
All amounts are estimates except the SEC registration fee.
SEC Registration Fee $1,800
Legal fees and expenses 20,000
Accounting fees and expenses 5,000
Miscellaneous fees and expenses 5,500
------
Total $32,300
-------
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
With respect to indemnification of directors and officers, Section 145 of
the Delaware General Corporation Law ("DGCL") provides that a corporation shall
have the power to indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of the corporation) by reason of the fact that the
person is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by the person in
connection with such action, suit or proceeding, if the person acted in good
faith and in a manner the person reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe the person's conduct was
unlawful. Under this provision of the DGCL, the termination of any action, suit
or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the person did not act in good faith and in a manner which the person reasonably
believed to be in or not opposed to the best interests of the corporation, and
with respect to any criminal action or proceeding, had reasonable cause to
believe that the person's conduct was unlawful.
Furthermore, the DGCL provides that a corporation shall have the power to
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that the
person is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees) actually and
reasonably incurred by the person in connection with the defense or settlement
of such action or suit if the person acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
The Company's Restated Certificate of Incorporation (the "Certificate of
Incorporation") and By-laws, as amended (the "By-laws") provide for limitation
of the liability of directors to the Company and its stockholders and for
indemnification of directors, officers, employees and agents of the Company,
respectively, to the maximum extent permitted by the DGCL.
II-1
The Certificate of Incorporation provides that directors are not liable to
the Company or its stockholders for monetary damages for breaches of fiduciary
duty as a director, except for liability (a) for any breach of the director's
duty of loyalty to the Company or its stockholders, (b) for acts or omissions
not in good faith or that involve intentional misconduct or a knowing violation
of law, (c) for dividend payments or stock repurchases in violation of Delaware
law, or (d) for any transaction from which the director derived any improper
personal benefit.
The By-laws include provisions by which the Company will indemnify its
officers and directors and other persons against expenses, judgments, fines and
amounts paid in settlement with respect to threatened, pending or completed
suits or proceedings against such persons by reason of serving or having served
the Company as officers, directors or in other capacities, except in relation to
matters with respect to which such persons shall be determined not to have acted
in good faith, lawfully or in the best interests of the Company. With respect to
matters to which the Company's officers, directors, employees, agents or other
representatives are determined to be liable for misconduct or negligence in the
performance of their duties, the By-laws provide for indemnification only to the
extent that the Company determines that such person acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the Company.
ITEM 16. EXHIBITS
2.1 Share Purchase Agreement
2.2 Warrant Agreement
5 Opinion of Harter, Secrest & Emery LLP
23.1 Independent Accountants' Consent
23.2 Consent of Harter, Secrest & Emery LLP (included in the Opinion of Counsel
filed as Exhibit 5 hereto)
24 Power of Attorney (see page II-4)
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes (subject to the proviso
contained in Item 512(a) of Regulation S-K):
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) to include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflect in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement; and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
II-2
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes to supplement the prospectus,
after expiration of the subscription period, to set forth the results of the
subscription offer, the transactions by the underwriters during the subscription
period, the amount of unsubscribed securities to be purchased by the
underwriters, and the terms of any subsequent reoffering thereof. If any public
offering by the underwriters is to be made on terms different from those set
forth on the cover page of the prospectus, a post-effective amendment will be
filed to set forth the terms of such offering.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
The undersigned registrant hereby undertakes to deliver or cause to be
delivered the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report, to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Exchange Act of 1934; and,
where interim financial information required to be presented by Article 3 of
Regulation S-X is not set forth in the prospectus, to deliver, or cause to be
delivered to each person to whom the prospectus is sent or given, the latest
quarterly report that is specially incorporated by referred in the prospectus to
provide such interim financial information.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that is has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Newark, State of New York, on this 17th day of August,
2001.
ULTRALIFE BATTERIES, INC.
By: /s/ JOHN D. KAVAZANJIAN
---------------------------------------------
John D. Kavazanjian,
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS that each person whose signature appears
below appoints John D. Kavazanjian, Robert W. Fishback and Peter F. Comerford,
jointly and severally, his or her attorneys-in-fact, each with the power of
substitution, for him or her in any and all capacities, to sign any amendment to
this Registration Statement on Form S-3, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, hereby ratifying and confirming that each of said
attorneys-in-fact, or his or her substitute or substitutes, may do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title Date
/s/ John D. Kavazanjian Chief Executive Officer, August 17, 2001
- ----------------------- President and Director
John D. Kavazanjian (Principal Executive Officer)
/s/ Robert W. Fishback Vice President-Finance and August 17, 2001
- ----------------------- Chief Financial Officer
Robert W. Fishback (Principal Financial Officer
and Principal Accounting
Officer)
/s/ Ranjit Singh Director August 17, 2001
- -----------------------
Ranjit Singh
/s/ Arthur M. Lieberman Director August 17, 2001
- -----------------------
Arthur M. Lieberman
/s/ Joseph C. Abeles Director August 17, 2001
- -----------------------
Joseph C. Abeles
/s/ Joseph N. Barrella Director August 17, 2001
- -----------------------
Joseph N. Barrella
/s/ Carl H. Rosner Director August 17, 2001
- -----------------------
Carl H. Rosner
/s/ Patricia C. Barron Director August 17, 2001
- -----------------------
Patricia C. Barron
II-4
INDEX TO EXHIBITS
2.1 Share Purchase Agreement
2.2 Warrant Agreement
5 Opinion of Harter, Secrest & Emery LLP
23.1 Consent of Independent Accountants'
23.2 Consent of Harter, Secrest & Emery LLP (included in the Opinion of Counsel
filed as Exhibit 5)
24 Power of Attorney (see page II-4)
Exhibit 2.1
ULTRALIFE BATTERIES, INC. SHARE PURCHASE AGREEMENT
This SHARE PURCHASE AGREEMENT (this "Agreement"), is made and entered into as of
July 19, 2001, by and among ULTRALIFE BATTERIES, INC., a Delaware corporation
(the "Company"), and the purchasers listed on Schedule A attached hereto
(collectively, the "Purchasers" and individually, a "Purchaser").
1. AUTHORIZATION OF SALE OF THE SHARES
Subject to the terms and conditions of this Agreement, the Company has
authorized the sale of up to 1,200,000 shares (the "Shares") of common stock,
par value $.10 per share (the "Common Stock"), of the Company.
2. AGREEMENT TO SELL AND PURCHASE THE SHARES
2.1 Purchase and Sale
Subject to the terms and conditions of this Agreement, each Purchaser severally
agrees to purchase, and the Company agrees to sell and issue to each Purchaser,
at the Closing (as defined below) that number of Shares set forth opposite such
Purchaser's name on Schedule A attached hereto.
2.2 Purchase Price
The purchase price of each Share shall be $6.25 (the "Per Share Price"). The
Company shall not, during the period beginning on the date of this Agreement and
ending ninety (90) days after the Closing Date (as defined below), without
adjusting the price per Share hereunder accordingly, (i) sell Shares at a price
per Share of less than the Per Share Price, or (ii) grant or issue options,
warrants or any other securities that can be converted into, or otherwise
exchanged for, shares of the Company's common stock at a conversion, exchange or
exercise price per Share of less than the Per Share Price. In the event the
Company shall, during the period beginning on the date of this Agreement and
ending ninety (90) days after the Closing Date, sell any shares of the Company's
common stock at, or grant or issue any instruments that can be converted into or
otherwise exchanged for the Company's common stock (the "Subsequent Sale")
exercisable at, a price per Share (the "Subsequent Purchase Price") of less than
the Per Share Price, the Company shall, within ten (10) business days of the
Subsequent Sale, pay to the Purchaser a cash amount equal to the number of
Shares times the difference between the Per Share Price and the Subsequent
Purchase Price.
3. DELIVERY OF THE SHARES AT THE CLOSING
(a) The completion of the purchase and sale of the Shares (the "Closing")
shall occur at the offices of Harter, Secrest & Emery LLP, counsel to the
Company, at Rochester, New York at 9:00 a.m. local time on June 28, 2001 or such
other time and date as may be agreed by the parties (the "Closing Date").
(b) At the Closing, the Company shall authorize its transfer agent (the
"Transfer Agent") to issue to each Purchaser one or more stock certificates
registered in the name of such Purchaser, or in such nominee name(s) as
designated by such Purchaser in writing, representing the number of Shares set
forth in Section 2 above and bearing an appropriate legend referring to the fact
that the Shares were sold in reliance upon the exemption from registration
provided by Section 4(2) of the Securities Act of 1933, as amended (the
"Securities Act"), and Rule 506 under the Securities Act. Within ten (10)
business days of Closing, the Company will cause to be delivered to each
Purchaser one certificate representing 100% of the Shares purchased by that
Purchaser (the "Certificates") against delivery of payment for the Shares by the
Purchasers; subject, however, to the provision that with respect to Shares
purchased by State of Wisconsin Investment Board, the Company will cause to be
delivered to that Purchaser one certificate representing 80% of the Shares
purchased and a second certificate representing 20% of the Shares purchased.
Prior to the Purchasers' delivery of payment for the Shares, the Company will
deliver via facsimile a copy of the Certificates to be delivered upon Closing to
the office of the Purchasers (at the fax number indicated on the signature pages
attached hereto).
(c) The Company's obligation to complete the purchase and sale of the
Shares shall be subject to the following conditions, any one or more of which
may be waived by the Company:
(i) receipt by the Company from stockholders holding rights to require
the Company to register the sale of any securities owned by such holder in the
Registration Statement (as defined below) of waivers of such rights (including
the waiver of any notice requirements related to such rights);
(ii) receipt by the Company of same-day funds in the full amount of
the purchase price for the Shares being purchased under this Agreement; and
(iii) the accuracy in all material respects of the representations and
warranties made by the Purchasers and the fulfillment in all material respects
of those undertakings of the Purchasers to be fulfilled before the Closing.
(d) The Purchasers' obligations to accept delivery of such stock
certificates and to pay for the Shares evidenced by the certificates shall be
subject to the following conditions, any one or more of which may be waived by a
Purchaser with respect to such Purchaser's obligation:
(i) the representations and warranties made by the Company in this
Agreement shall be accurate in all material respects and the undertakings of the
Company shall have been fulfilled in all material respects on or before the
Closing;
(ii) the Company shall have delivered to the Purchasers a certificate
executed by the chairman of the board or president and the chief financial or
accounting officer of the Company, dated the Closing Date, in form and substance
reasonably satisfactory to the Purchasers, to the effect that the
representations and warranties of the Company set forth in Section 4 hereof are
true and correct in all material respects as of the date of this Agreement and
as of the Closing Date, and that the Company has complied with all the
agreements and satisfied
all the conditions in this Agreement on its part to be performed or satisfied on
or before the Closing Date; and
(iii) the Company shall have delivered to Purchasers a legal opinion
in substantially the form attached hereto as Exhibit A.
(iv) the Company shall have obtained gross proceeds of at least
$5,000,000 from the sale of the Shares at the Closing.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY
Except as set forth on the Schedule of Exceptions attached hereto as Exhibit B,
the Company hereby represents and warrants to the Purchasers as follows (which
representations and warranties shall be deemed to apply, where appropriate, to
each subsidiary of the Company):
4.1 Organization and Qualification
The Company has been duly incorporated and is validly existing as a corporation
in good standing under the laws of the State of Delaware. The Company has the
corporate power and authority to own, lease and operate its properties and to
conduct its business as currently conducted and to enter into and perform its
obligations under this Agreement. The Company is duly qualified as a foreign
corporation to transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure to so
qualify would not, singly or in the aggregate, have a material adverse effect on
the condition, financial or otherwise, or the earnings, assets, business affairs
or business prospects of the Company.
4.2 Capitalization
(a) The authorized capital stock of the Company consists of 40,000,000
shares of Common Stock and 1,000,000 shares of Preferred Stock.
(b) As of May 31, 2001, the issued and outstanding capital stock of the
Company consisted of 11,460,536 shares of Common Stock and no shares of
Preferred Stock. The shares of issued and outstanding capital stock of the
Company have been duly authorized and validly issued, are fully paid and
nonassessable and have not been issued in violation of or are not otherwise
subject to any preemptive or other similar rights.
(c) The Company has reserved 2,564,850 shares of Common Stock for issuance
upon the exercise of stock options granted or available for future grant under
the Company's stock option plans.
(d) The Company has reserved 12,500 shares of Common Stock for issuance
upon the exercise of outstanding warrants to purchase Common Stock and up to
120,000 shares of Common Stock for issuance upon the exercise of the warrant to
be issued to H.C. Wainwright at Closing.
With the exception of the foregoing, there are no outstanding subscriptions,
options, warrants, convertible or exchangeable securities or other rights
granted to or by the Company to purchase
shares of Common Stock or other securities of the Company and there are no
commitments, plans or arrangements to issue any shares of Common Stock or any
security convertible into or exchangeable for Common Stock.
4.3 Issuance, Sale and Delivery of the Shares
(a) The Shares have been duly authorized for issuance and sale to the
Purchasers pursuant to this Agreement and, when issued and delivered by the
Company pursuant to this Agreement against payment of the consideration set
forth in this Agreement, will be validly issued and fully paid and nonassessable
and free and clear of all pledges, liens and encumbrances. The certificates
evidencing the Shares are in due and proper form under Delaware law.
(b) The issuance of the Shares is not subject to preemptive or other
similar rights. No further approval or authority of the shareholders or the
Board of Directors of the Company will be required for the issuance and sale of
the Shares to be sold by the Company as contemplated in this Agreement.
(c) Subject to the accuracy of the Purchasers' representations and
warranties in Section 5 of this Agreement, the offer, sale, and issuance of the
Shares in conformity with the terms of this Agreement constitute transactions
exempt from the registration requirements of Section 5 of the Securities Act and
from the registration or qualification requirements of the laws of any
applicable state or United States jurisdiction.
4.4 Financial Statements
The financial statements included (as exhibits or otherwise) in the Company
Documents (as defined below) present fairly the financial position of the
Company as of the dates indicated and the results of their operations for the
periods specified. Except as otherwise stated in such Company Documents, such
financial statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis, and any supporting
schedules included with the financial statements present fairly the information
stated in the financial statements. The financial and statistical data set forth
in the Company Documents were prepared on an accounting basis consistent with
such financial statements.
4.5 No Material Change
Since March 31, 2001,
(a) there has been no material adverse change or any development involving
a prospective material adverse change in or affecting the condition, financial
or otherwise, or in the earnings, assets, business affairs or business prospects
of the Company, whether or not arising in the ordinary course of business;
(b) there have been no transactions entered into by the Company other than
those in the ordinary course of business, which are material with respect to the
Company; and
(c) there has been no dividend or distribution of any kind declared, paid
or made by the Company on any class of its capital stock.
The Company has no material contingent obligations.
4.6 Environmental
Except as would not, singly or in the aggregate, reasonably be expected to have
a material adverse effect on the condition, financial or otherwise, or the
earnings, assets, business affairs or business prospects of the Company,
(a) the Company is in compliance with all applicable Environmental Laws
(as defined below);
(b) the Company has all permits, authorizations and approvals required
under any applicable Environmental Laws and is in compliance with the
requirements of such permits authorizations and approvals;
(c) there are no pending or, to the best knowledge of the Company,
threatened Environmental Claims (as defined below) against the Company; and
(d) under applicable law, there are no circumstances with respect to any
property or operations of the Company that are reasonably likely to form the
basis of an Environmental Claim against the Company.
For purposes of this Agreement, the following terms shall have the following
meanings: "Environmental Law" means any United States (or other applicable
jurisdiction's) Federal, state, local or municipal statute, law, rule,
regulation, ordinance, code, policy or rule of common law and any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree or judgment, relating to the environment, health, safety
or any chemical, material or substance, exposure to which is prohibited, limited
or regulated by any governmental authority. "Environmental Claims" means any and
all administrative, regulatory or judicial actions, suits, demands, demand
letters, claims, liens, notices of noncompliance or violation, investigations or
proceedings relating in any way to any Environmental Law.
4.7 No Defaults
The Company is not in violation of its certificate of incorporation or bylaws or
in material default in the performance or observance of any obligation,
agreement, covenant or condition contained in any material contract, indenture,
mortgage, loan agreement, deed, trust, note, lease, sublease, voting agreement,
voting trust, or other instrument or material agreement to which the Company is
a party or by which it may be bound, or to which any of the property or assets
of the Company is subject.
4.8 Labor Matters
No labor dispute with the employees of the Company exists or, to the best
knowledge of the Company, is imminent.
4.9 No Actions
There is no action, suit or proceeding before or by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened, against or
affecting the Company which, singly or in the aggregate, might result in any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company, or which,
singly or in the aggregate, might materially and adversely affect the properties
or assets thereof or which might materially and adversely affect the
consummation of this Agreement, nor, to the best knowledge of the Company, is
there any reasonable basis therefor. The Company is not in default with respect
to any judgment, order or decree of any court or governmental agency or
instrumentality which, singly or in the aggregate, would have a material adverse
effect on the assets, properties or business of the Company.
4.10 Intellectual Property
(a) The Company, to the best of its knowledge in the course of diligent
inquiry, owns or is licensed to use all patents, patent applications,
inventions, trademarks, trade names, applications for registration of
trademarks, service marks, service mark applications, copyrights, know-how,
manufacturing processes, formulae, trade secrets, licenses and rights in any
thereof and any other intangible property and assets that are material to the
business of the Company as now conducted and as proposed to be conducted (in
this Agreement called the "Proprietary Rights"), or is seeking, or will seek, to
obtain rights to use such Proprietary Rights that are material to the business
of the Company as proposed to be conducted.
(b) The Company does not have any knowledge of, and the Company has not
given or received any notice of, any pending conflicts with or infringement of
the rights of others with respect to any Proprietary Rights or with respect to
any license of Proprietary Rights which are material to the business of the
Company.
(c) No action, suit, arbitration, or legal, administrative or other
proceeding, or investigation is pending, or, to the best knowledge of the
Company, threatened, which involves any Proprietary Rights, nor, to the best
knowledge of the Company, is there any reasonable basis therefor.
(d) The Company is not subject to any judgment, order, writ, injunction or
decree of any court or any Federal, state, local, foreign or other governmental
department, commission, board, bureau, agency or instrumentality, domestic or
foreign, or any arbitrator, and has not entered into or is not a party to any
contract which restricts or impairs the use of any such Proprietary Rights in a
manner which would have a material adverse effect on the use of any of the
Proprietary Rights.
(e) The Company has not received written notice of any pending conflict
with or infringement upon such third-party proprietary rights.
(f) The Company has not entered into any consent, indemnification,
forbearance to sue or settlement agreement with respect to Proprietary Rights
other than in the ordinary course of business. No claims have been asserted by
any person with respect to the validity of the Company's ownership or right to
use the Proprietary Rights and, to the best knowledge of the Company, there is
no reasonable basis for any such claim to be successful.
(g) The Company has complied, in all material respects, with its
obligations relating to the protection of the Proprietary Rights which are
material to the business of the Company used pursuant to licenses.
(h) To the best knowledge of the Company, no person is infringing on or
violating the Proprietary Rights.
4.11 Permits
The Company possesses and is operating in compliance with all material licenses,
certificates, consents, authorities, approvals and permits from all state,
federal, foreign and other regulatory agencies or bodies necessary to conduct
the businesses now operated by it, and the Company has not received any notice
of proceedings relating to the revocation or modification of any such permit or
any circumstance which would lead it to believe that such proceedings are
reasonably likely which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would materially and adversely affect
the condition, financial or otherwise, or the earnings, assets, business affairs
or business prospects of the Company.
4.12 Due Execution, Delivery and Performance
(a) This Agreement has been duly executed and delivered by the Company and
constitutes a valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms.
(b) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated in this Agreement and the
fulfillment of the terms of this Agreement, including the sale, issuance and
delivery of the Shares, (i) have been duly authorized by all necessary corporate
action on the part of the Company, its directors and stockholders; (ii) will not
conflict with or constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company pursuant to, any contract, indenture, mortgage, loan
agreement, deed, trust, note, lease, sublease, voting agreement, voting trust or
other instrument or agreement to which the Company is a party or by which it may
be bound, or to which any of the property or assets of the Company is subject;
(iii) will not trigger anti-dilution rights or other rights to acquire
additional equity securities of the Company; and (iv) will not result in any
violation of the provisions of the articles of incorporation or bylaws of the
Company or any applicable statute, law, rule, regulation, ordinance, decision,
directive or order.
4.13 Properties
The Company has good and marketable title to its properties, free and clear
of all material security interests, mortgages, pledges, liens, charges,
encumbrances and claims of record. The properties of the Company are, in the
aggregate, in good repair (reasonable wear and tear excepted), and suitable for
their respective uses. Any real property held under lease by the Company is held
under valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the conduct of the business of the Company.
The Company owns or leases all such properties as are necessary to its business
or operations as now conducted.
4.14 Compliance
The Company has conducted and is conducting its business in compliance with all
applicable Federal, state, local and foreign statutes, laws, rules, regulations,
ordinances, codes, decisions, decrees, directives and orders, except where the
failure to do so would not, singly or in the aggregate, have a material adverse
effect on the condition, financial or otherwise, or on the earnings, assets,
business affairs or business prospects of the Company.
4.15 Security Measures
The Company takes security measures designed to enable the Company to assert
trade secret protection in its non-patented technology.
4.16 Contributions
To the best of the Company's knowledge, neither the Company nor any employee or
agent of the Company has made any payment of funds of the Company or received or
retained any funds in violation of any law, rule or regulation.
4.17 Use of Proceeds; Investment Company
The Company intends to use the proceeds from the sale of the Shares for working
capital and other general corporate purposes. The Company is not now, and after
the sale of the Shares under this Agreement and under all other agreements and
the application of the net proceeds from the sale of the Shares described in the
proceeding sentence will not be, an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.
4.18 Prior Offerings
All offers and sales of capital stock of the Company before the date of this
Agreement were at all relevant times duly registered or exempt from the
registration requirements of the Securities Act and were duly registered or
subject to an available exemption from the registration requirements of the
applicable state securities or Blue Sky laws.
4.19 Taxes
The Company has filed all material tax returns required to be filed, which
returns are true and correct in all material respects, and the Company is not in
default in the payment of any taxes, including penalties and interest,
assessments, fees and other charges, shown thereon due or otherwise assessed,
other than those being contested in good faith and for which adequate
reserves have been provided or those currently payable without interest which
were payable pursuant to said returns or any assessments with respect thereto.
4.20 Other Governmental Proceedings
To the Company's knowledge, there are no rulemaking or similar proceedings
before any Federal, state, local or foreign government bodies that involve or
affect the Company, which, if the subject of an action unfavorable to the
Company, could involve a prospective material adverse change in or effect on the
condition, financial or otherwise, or in the earnings, assets, business affairs
or business prospects of the Company.
4.21 Non-Competition Agreements
To the knowledge of the Company, any full-time employee who has entered into any
non-competition, non-disclosure, confidentiality or other similar agreement with
any party other than the Company is neither in violation of nor is expected to
be in violation of that agreement as a result of the business currently
conducted or expected to be conducted by the Company or such person's
performance of his or her obligations to the Company. The Company has not
received written notice that any consultant or scientific advisor of the Company
is in violation of any non-competition, non-disclosure, confidentiality or
similar agreement.
4.22 Transfer Taxes
On the Closing Date, all stock transfer or other taxes (other than income taxes)
that are required to be paid in connection with the sale and transfer of the
Shares to be sold to the Purchasers under this Agreement will be, or will have
been, fully paid or provided for by the Company and all laws imposing such taxes
will be or will have been fully complied with.
4.23 Insurance
The Company maintains insurance of the type and in the amount that the Company
reasonably believes is adequate for its business, including, but not limited to,
insurance covering all real and personal property owned or leased by the Company
against theft, damage, destruction, acts of vandalism and all other risks
customarily insured against by similarly situated companies, all of which
insurance is in full force and effect.
4.24 Governmental/ Regulatory Consents
No registration, authorization, approval, qualification or consent with or
required by any court or governmental/ regulatory authority or agency is
necessary in connection with the execution and delivery of this Agreement or the
offering, issuance or sale of the Shares under this Agreement.
4.25 Securities and Exchange Commission Filings
The Company has timely filed with the Securities and Exchange Commission (the
"Commission") all documents required to be filed by the Company under the
Securities Exchange Act of 1934, as amended (the "Exchange Act.")
4.26 Additional Information
The Company represents and warrants that the information contained in the
following documents (the "Company Documents"), which will be provided to
Purchaser before the Closing, is or will be true and correct in all material
respects as of their respective final dates:
(a) the Company's Annual Report on Form 10-K for the fiscal year ended
June 30, 2000.
(b) the Company's Quarterly Reports on Form 10-Q for the fiscal quarters
ended September 30, 2000, December 31, 2000 and March 31, 2001;
(c) the Company's Proxy Statement for its 2000 Annual Meeting of
Shareholders; and
(d) all other documents, if any, filed by the Company with the Commission
since May 14, 2001 pursuant to the reporting requirements of the Securities
Exchange Act.
4.27 Contracts
The contracts described in the Company Documents or incorporated by reference
therein are in full force and effect on the date hereof, except for contracts
the termination or expiration of which would not, singly or in the aggregate,
have a material adverse effect on the business, properties or assets of the
Company. Neither the Company nor, to the best knowledge of the Company, any
other party is in material breach of or default under any such contracts.
4.28 No Integrated Offering
Neither the Company, nor any of its affiliates, nor any person acting on its or
their behalf, has directly or indirectly made any offers or sales in any
security or solicited any offers to buy any security under circumstances that
would require registration under the Securities Act of the issuance of the
Shares to the Purchasers. The issuance of the Shares to the Purchasers will not
be integrated with any other issuance of the Company's securities (past, current
or future) for purposes of the Securities Act or any applicable rules of Nasdaq
(or of any national securities exchange on which the Company's Common Stock is
then traded). The Company will not make any offers or sales of any security
(other than the Shares) that would cause the offering of the Shares to be
integrated with any other offering of securities by the Company for purposes of
any registration requirement under the Securities Act or any applicable rules of
Nasdaq (or of any national securities exchange on which the Company's Common
Stock is then traded).
4.29 Listing of Shares
The Company agrees to promptly secure the listing of the Shares upon each
national securities exchange or automated quotation system upon which shares of
Common Stock are then listed and, so long as any Purchaser owns any of the
Shares, shall maintain such listing of all Shares. The Company has taken no
action designed to delist, or which is likely to have the effect of delisting,
the Common Stock from any of the national securities exchange or automated
quotation system upon which the shares of Common Stock are then listed.
4.30 No Manipulation of Stock
The Company has not taken and will not, in violation of applicable law, take any
action outside the ordinary course of business designed to or that might
reasonably be expected to cause or result in unlawful manipulation of the price
of the Common Stock to facilitate the sale or resale of the Shares.
5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASERS
5.1 Securities Law Representations and Warranties
Each Purchaser represents, warrants and covenants to the Company as follows:
(a) The Purchaser is knowledgeable, sophisticated and experienced in
making, and is qualified to make, decisions with respect to investments in
shares representing an investment decision like that involved in the purchase of
the Shares, including investments in securities issued by the Company, and has
requested, received, reviewed and considered all information it deems relevant
in making an informed decision to purchase the Shares.
(b) The Purchaser is acquiring the number of Shares set forth in Section 2
above in the ordinary course of its business and for its own account for
investment (as defined for purposes of the Hart-Scott-Rodino Antitrust
Improvement Act of 1976 and the regulations thereunder) only, and has no present
intention of distributing any of the Shares nor any arrangement or understanding
with any other persons regarding the distribution of such Shares within the
meaning of Section 2(11) of the Securities Act, other than as contemplated in
Section 7 of this Agreement.
(c) The Purchaser will not, directly or indirectly, offer, sell, pledge,
transfer or otherwise dispose of (or solicit any offers to buy, purchase or
otherwise acquire or take a pledge of) any of the Shares except in compliance
with the Securities Act and the rules and regulations promulgated thereunder
(the "Rules and Regulations").
(d) The Purchaser has completed or caused to be completed the Stock
Certificate Questionnaire and the Registration Statement Questionnaire, attached
to this Agreement as Appendices I and II, for use in preparation of the
Registration Statement (as defined in Section 7.3 below), and the answers to the
Questionnaires are true and correct as of the date of this Agreement and will be
true and correct as of the effective date of the Registration Statement;
provided that the Purchasers shall be entitled to update such information by
providing notice thereof to the Company before the effective date of such
Registration Statement.
(e) The Purchaser has, in connection with its decision to purchase the
number of Shares set forth in Section 2 above, relied solely upon the Company
Documents and the representations and warranties of the Company contained in
this Agreement.
(f) The Purchaser is an "accredited investor" within the meaning of Rule
501 of Regulation D promulgated under the Securities Act.
5.2 Resales of Shares
(a) The Purchaser hereby covenants with the Company not to make any sale
of the Shares without satisfying the requirements of the Securities Act and the
Rules and Regulations, including, in the event of any resale under the
Registration Statement, the prospectus delivery requirements under the
Securities Act, and the Purchaser acknowledges and agrees that such Shares are
not transferable on the books of the Company pursuant to a resale under the
Registration Statement unless the certificate submitted to the transfer agent
evidencing the Shares is accompanied by a separate officer's certificate
(i) in the form of Appendix III to this Agreement;
(ii) executed by an officer of, or other authorized person designated
by, the Purchaser; and
(iii) to the effect that (A) the Shares have been sold in accordance
with the Registration Statement and (B) the requirement of delivering a current
prospectus has been satisfied.
(b) The Purchaser acknowledges that there may occasionally be times when
the Company determines, in good faith following consultation with its Board of
Directors or a committee thereof, the use of the prospectus forming a part of
the Registration Statement (the "Prospectus," as further defined in Section
7.3.1 below) should be suspended until such time as an amendment or supplement
to the Registration Statement or the Prospectus has been filed by the Company
and any such amendment to the Registration Statement is declared effective by
the Commission, or until such time as the Company has filed an appropriate
report with the Commission pursuant to the Exchange Act. The Purchaser hereby
covenants that it will not sell any Shares pursuant to the Prospectus during the
period commencing at the time at which the Company gives the Purchaser written
notice of the suspension of the use of the Prospectus and ending at the time the
Company gives the Purchaser written notice that the Purchaser may thereafter
effect sales pursuant to the Prospectus. The Company may, upon written notice to
the Purchasers, suspend the use of the Prospectus for up to thirty (30) days in
any 365-day period based on the reasonable determination of the Company's Board
of Directors that there is a significant business purpose for such
determination, such as pending corporate developments, public filings with the
SEC or similar events. The Company shall in no event be required to disclose the
business purpose for which it has suspended the use of the Prospectus if the
Company determines in its good faith judgment that the business purpose should
remain confidential. In addition, the Company shall notify each Purchaser (i) of
any request by the SEC
for an amendment or any supplement to such Registration Statement or any related
prospectus, or any other information request by any other governmental agency
directly relating to the offering, and (ii) of the issuance by the SEC of any
stop order suspending the effectiveness of such Registration Statement or of any
order preventing or suspending the use of any related prospectus or the
initiation or threat of any proceeding for that purpose.
(c) The Purchaser further covenants to notify the Company promptly of the
sale of any of its Shares, other than sales pursuant to a Registration Statement
contemplated in Section 7 of this Agreement or sales upon termination of the
transfer restrictions pursuant to Section 7.4 of this Agreement.
5.3 Due Execution, Delivery and Performance
(a) This Agreement has been duly executed and delivered by the Purchaser
and constitutes a valid and binding obligation of the Purchaser, enforceable
against the Purchaser in accordance with its terms.
(b) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated in this Agreement and the
fulfillment of the terms of this Agreement have been duly authorized by all
necessary corporate action and will not conflict with or constitute a breach of,
or default under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Purchaser pursuant to, any
contract, indenture, mortgage, loan agreement, deed, trust, note, lease,
sublease, voting agreement, voting trust or other instrument or agreement to
which the Purchaser is a party or by which it or any of them may be bound, or to
which any of the property or assets of the Purchaser is subject, nor will such
action result in any violation of the provisions of the charter or bylaws of the
Purchaser or any applicable statute, law, rule, regulation, ordinance, decision,
directive or order.
6. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
Notwithstanding any investigation made by any party to this Agreement, all
covenants, agreements, representations and warranties made by the Company and
the Purchasers in this Agreement and in the certificates for the Shares
delivered pursuant to this Agreement shall survive the execution of this
Agreement, the delivery to the Purchasers of the Shares being purchased and the
payment therefor.
7. FORM D FILING; REGISTRATION; COMPLIANCE WITH THE SECURITIES ACT; COVENANTS
7.1 Form D Filing; Registration of Shares
7.1.1 Registration Statement; Expenses
The Company shall:
(a) file in a timely manner a Form D relating to the sale of the
Shares under this Agreement, pursuant to Securities and Exchange Commission
Regulation D.
(b) as soon as practicable after the Closing Date, but in no event later
than the 30th day following the Closing Date, prepare and file with the
Commission a Registration Statement on Form S-3 (or, if the Company is
ineligible to use Form S-3, then on Form S-1) relating to the sale of the Shares
by the Purchasers from time to time on the Nasdaq National Market (or the
facilities of any national securities exchange on which the Company's Common
Stock is then traded) or in privately negotiated transactions (the "Registration
Statement");
(c) provide to Purchasers any information required to permit the sale of
the Shares under Rule 144A of the Securities Act;
(d) subject to receipt of necessary information from the Purchasers, use
its best efforts to cause the Commission to notify the Company of the
Commission's willingness to declare the Registration Statement effective on or
before 90 days after the Closing Date;
(e) notify Purchasers promptly upon the Registration Statement, and any
post-effective amendment thereto, being declared effective by the Commission;
(f) prepare and file with the Commission such amendments and supplements
to the Registration Statement and the Prospectus (as defined in Section 7.3.1
below) and take such other action, if any, as may be necessary to keep the
Registration Statement effective until the earlier of (i) the date on which the
Shares may be resold by the Purchasers without registration and without regard
to any volume limitations by reason of Rule 144(k) under the Securities Act or
any other rule of similar effect or (ii) all of the Shares have been sold
pursuant to the Registration Statement or Rule 144 under the Securities Act or
any other rule of similar effect;
(g) promptly furnish to the Purchasers with respect to the Shares
registered under the Registration Statement such reasonable number of copies of
the Prospectus, including any supplements to or amendments of the Prospectus, in
order to facilitate the public sale or other disposition of all or any of the
Shares by the Purchasers;
(h) during the period when copies of the Prospectus are required to be
delivered under the Securities Act or the Exchange Act, will file all documents
required to be filed with the Commission pursuant to Section 13, 14 or 15 of the
Exchange Act within the time periods required by the Exchange Act and the rules
and regulations promulgated thereunder;
(i) file documents required of the Company for customary Blue Sky
clearance in all states requiring Blue Sky clearance; provided, however, that
the Company shall not be required to qualify to do business or consent to
service of process in any jurisdiction in which it is not now so qualified or
has not so consented; and
(j) bear all expenses (other than the expenses of a Purchaser's attorney,
accountant or other consultant retained by a Purchaser) in connection with the
procedures in paragraphs (a) through (i) of this Section 7.1.1 and the
registration of the Shares pursuant to the Registration Statement.
7.1.2 Delay in Effectiveness of Registration Statement
In the event that the Registration Statement is not declared effective on or
before the 90th day following the Closing Date (the "Penalty Date"), the Company
shall pay to each Purchaser liquidated damages in an amount equal to 0.25% of
the total purchase price of the Shares purchased by such Purchaser pursuant to
this Agreement for each week after the Penalty Date that the Registration
Statement is not declared effective.
7.2 Transfer of Shares After Registration
Each Purchaser agrees that it will not effect any disposition of the Shares or
its right to purchase the Shares that would constitute a sale within the meaning
of the Securities Act, except as contemplated in the Registration Statement
referred to in Section 7.1 or as otherwise permitted by law, and that it will
promptly notify the Company of any changes in the information set forth in the
Registration Statement regarding the Purchaser or its plan of distribution.
7.3 Indemnification
For the purpose of this Section 7.3, the term "Registration Statement" shall
include any preliminary or final prospectus, exhibit, supplement or amendment
included in or relating to the Registration Statement referred to in Section
7.1.
7.3.1 Indemnification by the Company
The Company agrees to indemnify and hold harmless each of the Purchasers and
each person, if any, who controls any Purchaser within the meaning of the
Securities Act, against any losses, claims, damages, liabilities or expenses,
joint or several, to which such Purchasers or such controlling person may become
subject, under the Securities Act, the Exchange Act, or any other federal or
state statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of the Company, which consent shall not be unreasonably withheld),
insofar as such losses, claims, damages, liabilities or expenses (or actions in
respect thereof as contemplated below) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, including the Prospectus, financial statements and
schedules, and all other documents filed as a part thereof, as amended at the
time of effectiveness of the Registration Statement, including any information
deemed to be a part thereof as of the time of effectiveness pursuant to
paragraph (b) of Rule 430A, or pursuant to Rule 434, of the Rules and
Regulations, or the Prospectus, in the form first filed with the Commission
pursuant to Rule 424(b) of the Regulations, or filed as part of the Registration
Statement at the time of effectiveness if no Rule 424(b) filing is required (the
"Prospectus"), or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state in any of them a material
fact required to be stated therein or necessary to make the statements in any of
them, in light of the circumstances under which they were made, not misleading,
or arise out of or are based in whole or in part on any inaccuracy in the
representations and warranties of the Company contained in this Agreement, or
any failure of the Company to perform its obligations under this Agreement or
under law, and will reimburse each Purchaser and each such controlling person
for any legal and other expenses as such expenses are reasonably incurred by
such Purchaser or such controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage,
liability, expense or action; provided,
however, that the Company will not be liable in any such case to the extent that
any such loss, claim, damage, liability or expense arises out of or is based
upon (i) an untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement, the Prospectus or any amendment or
supplement of the Registration Statement or Prospectus in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
the Purchaser expressly for use in the Registration Statement or the Prospectus,
or (ii) the failure of such Purchaser to comply with the covenants and
agreements contained in Sections 5.2 or 7.2 of this Agreement respecting resale
of the Shares, or (iii) the inaccuracy of any representations made by such
Purchaser in this Agreement or (iv) any untrue statement or omission of a
material fact required to make such statement not misleading in any Prospectus
that is corrected in any subsequent Prospectus that was delivered to the
Purchaser before the pertinent sale or sales by the Purchaser.
7.3.2 Indemnification by the Purchaser
Each Purchaser will severally and not jointly indemnify and hold harmless the
Company, each of its directors, each of its officers who signed the Registration
Statement and each person, if any, who controls the Company within the meaning
of the Securities Act, against any losses, claims, damages, liabilities or
expenses to which the Company, each of its directors, each of its officers who
signed the Registration Statement or controlling person may become subject,
under the Securities Act, the Exchange Act, or any other federal or state
statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of such Purchaser, which consent shall not be unreasonably withheld)
insofar as such losses, claims, damages, liabilities or expenses (or actions in
respect thereof as contemplated below) arise out of or are based upon (i) any
failure on the part of such Purchaser to comply with the covenants and
agreements contained in Sections 5.2 or 7.2 of this Agreement respecting the
sale of the Shares or (ii) the inaccuracy of any representation made by such
Purchaser in this Agreement or (iii) any untrue or alleged untrue statement of
any material fact contained in the Registration Statement, the Prospectus, or
any amendment or supplement to the Registration Statement or Prospectus, 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, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in the Registration Statement, the Prospectus, or any
amendment or supplement thereto, in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Purchaser expressly
for use therein; provided, however, that the Purchaser shall not be liable for
any such untrue or alleged untrue statement or omission or alleged omission of
which the Purchaser has delivered to the Company in writing a correction before
the occurrence of the transaction from which such loss was incurred, and the
Purchaser will reimburse the Company, each of its directors, each of its
officers who signed the Registration Statement or controlling person for any
legal and other expense reasonably incurred by the Company, each of its
directors, each of its officers who signed the Registration Statement or
controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action.
7.3.3 Indemnification Procedure
(a) Promptly after receipt by an indemnified party under this Section 7.3
of notice of the threat or commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 7.3, promptly notify the indemnifying party in writing of the
claim; but the omission so to notify the indemnifying party will not relieve it
from any liability which it may have to any indemnified party for contribution
or otherwise under the indemnity agreement contained in this Section 7.3 or to
the extent it is not prejudiced as a result of such failure.
(b) In case any such action is brought against any indemnified party and
such indemnified party seeks or intends to seek indemnity from an indemnifying
party, the indemnifying party will be entitled to participate in, and, to the
extent that it may wish, jointly with all other indemnifying parties similarly
notified, to assume the defense thereof with counsel reasonably satisfactory to
such indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be a conflict
between the positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be legal defenses
available to it or other indemnified parties that are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 7.3 for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless:
(i) the indemnified party shall have employed such counsel in
connection with the assumption of legal defenses in accordance with the proviso
to the preceding sentence (it being understood, however, that the indemnifying
party shall not be liable for the expenses of more than one separate counsel,
approved by such indemnifying party representing all of the indemnified parties
who are parties to such action) or
(ii) the indemnifying party shall not have employed counsel reasonably
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of action, in each of which cases
the reasonable fees and expenses of counsel shall be at the expense of the
indemnifying party. Notwithstanding the provisions of this Section 7.3, the
Purchaser shall not be liable for any indemnification obligation under this
Agreement in excess of the amount of gross proceeds received by the Purchaser
from the sale of the Shares.
7.3.4 Contribution
If the indemnification provided for in this Section 7.3 is required by its terms
but is for any reason held to be unavailable to or otherwise insufficient to
hold harmless an indemnified party under this Section 7.3 in respect to any
losses, claims, damages, liabilities or expenses referred to in this Agreement,
then each applicable indemnifying party shall contribute to the amount paid
or payable by such indemnified party as a result of any losses, claims, damages,
liabilities or expenses referred to in this Agreement
(a) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Purchaser from the sale of Common Stock or
(b) if the allocation provided by clause (a) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (a) above but the relative fault of the
Company and the Purchaser in connection with the statements or omissions or
inaccuracies in the representations and warranties in this Agreement that
resulted in such losses, claims, damages, liabilities or expenses, as well as
any other relevant equitable considerations.
The respective relative benefits received by the Company on the one hand and
each Purchaser on the other shall be deemed to be in the same proportion as the
amount paid by such Purchaser to the Company pursuant to this Agreement for the
Shares purchased by such Purchaser that were sold pursuant to the Registration
Statement bears to the difference (the "Difference") between the amount such
Purchaser paid for the Shares that were sold pursuant to the Registration
Statement and the amount received by such Purchaser from such sale. The relative
fault of the Company and each Purchaser shall be determined by reference to,
among other things, whether the untrue or alleged statement of a material fact
or the omission or alleged omission to state a material fact or the inaccurate
or the alleged inaccurate representation or warranty relates to information
supplied by the Company or by such Purchaser and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in Section 7.3.3, any
legal or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim. The provisions set forth in
Section 7.3.3 with respect to the notice of the threat or commencement of any
threat or action shall apply if a claim for contribution is to be made under
this Section 7.3.4; provided, however, that no additional notice shall be
required with respect to any threat or action for which notice has been given
under Section 7.3 for purposes of indemnification. The Company and each
Purchaser agree that it would not be just and equitable if contribution pursuant
to this Section 7.3 were determined solely by pro rata allocation (even if the
Purchaser were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to in this paragraph. Notwithstanding the provisions of this Section 7.3, no
Purchaser shall be required to contribute any amount in excess of the amount by
which the Difference exceeds the amount of any damages that such Purchaser has
otherwise been required to pay 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. The Purchasers' obligations to contribute pursuant
to this Section 7.3 are several and not joint.
7.4 Termination of Conditions and Obligations
The restrictions imposed by Section 5 or this Section 7 upon the transferability
of the Shares shall cease and terminate as to any particular number of the
Shares upon the passage of two years
from the Closing Date or at such time as an opinion of counsel satisfactory in
form and substance to the Company shall have been rendered to the effect that
such conditions are not necessary in order to comply with the Securities Act.
7.5 Information Available
From the date of this Agreement through the date the Registration Statement
covering the resale of Shares owned by any Purchaser is no longer effective, the
Company will furnish to such Purchaser:
(a) as soon as practicable after available (but in the case of the
Company's Annual Report to Shareholders, within 90 days after the end of each
fiscal year of the Company), one copy of
(i) its Annual Report to Shareholders (which Annual Report shall
contain financial statements audited in accordance with generally accepted
accounting principles by a national firm of certified public accountants);
(ii) if not included in substance in the Annual Report to
Shareholders, its Annual Report on Form 10-K;
(iii) its quarterly reports on Form 10-Q; and
(iv) a full copy of the particular Registration Statement covering the
Shares (the foregoing, in each case, excluding exhibits);
(b) upon the request of the Purchaser, a reasonable number of copies of
the Prospectus to supply to any other party requiring the Prospectus.
7.6 Rule 144 Information
Until the earlier of (i) the date on which the Shares may be resold by the
Purchasers without registration and without regard to any volume limitations by
reason of Rule 144(k) under the Securities Act or any other rule of similar
effect or (ii) all of the Shares have been sold pursuant to the Registration
Statement or Rule 144 under the Securities Act or any other rule of similar
effect, the Company shall file all reports required to be filed by it under the
Securities Act, the Rules and Regulations and the Exchange Act and shall take
such further action to the extent required to enable the Purchasers to sell the
Shares pursuant to Rule 144 under the Securities Act (as such rule may be
amended from time to time).
7.7 Stock Option Matters and Prohibition on Toxics
(a) To the extent the Company has not already done so, the Company shall,
within thirty (30) days of the Closing Date, adopt such amendments to, with
respect to (i) and (ii) below, the Company's stock option plans and By-laws,
and, with respect to (iii) and (iv) below, the Company's By-laws (together, the
"Stock Option Plan and By-law Amendments") to provide that, unless approved by
the holders of a majority of the shares present and entitled to vote at a duly
convened meeting of shareholders, the Company shall not:
(i) grant any stock options with an exercise price that is less than
100% of the fair market value of the underlying stock on the date of grant;
(ii) reduce the exercise price of any stock option granted under any
existing or future stock option plan;
(iii) sell or issue any security of the Company convertible,
exercisable or exchangeable into shares of Common Stock, having a conversion,
exercise or exchange price per share which is subject to downward adjustment
based on the market price of the Common Stock at the time of conversion,
exercise or exchange of such security into Common Stock (except for appropriate
adjustments made to give effect to any stock splits or stock dividends); or
(iv) enter into (a) any equity line or similar agreement or
arrangement; or (b) any agreement to sell Common Stock (or any security
convertible, exercisable or exchangeable into shares of Common Stock ("Common
Stock Equivalent")) at a per share price (or, with respect to a Common Stock
Equivalent, at a conversion, exercise or exchange price, as the case may be
("Equivalent Price")) that is fixed after the execution date of the agreement,
whether or not based on any predetermined price-setting formula or calculation
method. Notwithstanding the foregoing, however, a price protection clause shall
be permitted in an agreement for sale of Common Stock or Common Stock
Equivalent, if such clause provides for an adjustment to the price per share of
Common Stock or, with respect to a Common Stock Equivalent, to the Equivalent
Price (provided that such price or Equivalent Price is fixed on or before the
execution date of the agreement) (the "Fixed Price") in the event that the
Company, during the period beginning on the date of the agreement and ending no
later than 90 days after the closing date of the transaction, sells shares of
Common Stock or Common Stock Equivalent to another investor at a price or
Equivalent Price, as the case may be, below the Fixed Price.
(v) The Stock Option Plan and By-law Amendments may not be further
amended or repealed without the affirmative vote of the holders of a majority of
the shares present and entitled to vote at a duly convened meeting of
shareholders. Upon the adoption of the Stock Option Plan and By-law Amendments,
the Company shall promptly furnish a copy of such amendments to the Purchasers.
The Company agrees that, prior to the adoption of the Stock Option Plan and
By-law Amendments by all necessary corporate action of the Company as described
above, the Company shall not conduct any of the actions specified in (i), (ii),
(iii) or (iv) above of this Section 7.7.
8. LEGAL FEES AND OTHER TRANSACTION EXPENSES
8.1.1 [For the Purchaser known as State of Wisconsin Investment Board]: At
the Closing, the Company agrees to pay a flat fee of $5,000 to the State of
Wisconsin Investment Board for their legal and other transaction expenses
(whether internal or external) arising in connection with the transactions
contemplated by this Agreement.
[For the remaining Purchasers listed on Schedule "A" attached hereto and
made a part hereof.]: The Company and each Purchaser shall be responsible for
their own legal and other transaction expenses (whether internal or external)
arising in connection with the transactions contemplated by this Agreement.
9. BROKER'S FEE
The Purchasers acknowledge that the Company intends to pay to H.C. Wainwright &
Co., Inc., the placement agent, a fee in respect of the sale of the Shares to
certain of the Purchasers that will consist of $200,000 and a five-year warrant
to purchase for $6.25 per share up to that number of shares of the Company's
Common Stock as equals 10% of the Shares purchased pursuant to this Agreement.
The Purchasers also acknowledge that the Company intends to pay to Kimelman &
Baird LLC a cash fee equal to 5% of the amount raised through the sale of the
Shares to certain of the Purchasers affiliated with Kimelman & Baird LLC. Each
of the parties to this Agreement hereby represents that, on the basis of any
actions and agreements by it, there are no other brokers or finders entitled to
compensation in connection with the sale of the Shares to the Purchasers. The
Company shall indemnify and hold harmless the Purchasers from and against all
fees, commissions or other payments owing by the Company to H.C. Wainwright &
Co., Inc. and Kimelman & Baird LLC or any other person or firm acting on behalf
of the Company hereunder, and each Purchaser, severally and not jointly, shall
indemnify and hold harmless the Company from and against all fees, commissions
or other payments owing by such Purchaser to any person or firm acting on behalf
of such Purchaser.
10. NOTICES
All notices, requests, consents and other communications under this Agreement
shall be in writing, shall be mailed by first-class registered or certified
airmail, confirmed facsimile or nationally recognized overnight express courier
postage prepaid, and shall be delivered as addressed as follows:
(a) if to the Company, to:
Ultralife Batteries, Inc.
2000 Technology Parkway
Newark, New York 14513
Attention: Robert W. Fishback
or to such other person at such other place as the Company shall designate to
the Purchaser in writing; and
(b) if to a Purchaser, at its address as set forth on the signature page
to this Agreement, or at such other address or addresses as may have been
furnished to the Company in writing.
Such notice shall be deemed effectively given upon confirmation of receipt by
facsimile, one business day after deposit with such overnight courier or three
days after deposit of such registered or certified airmail with the U.S. Postal
Service, as applicable.
11. MODIFICATION; AMENDMENT
This Agreement may not be modified or amended except pursuant to an instrument
in writing signed by the Company and each of the Purchasers.
12. TERMINATION
This Agreement may be terminated as to any Purchaser, at the option of such
Purchaser, if the Closing has not occurred on or before thirty (30) days from
the date of this Agreement.
13. HEADINGS
The headings of the various sections of this Agreement have been inserted for
convenience of reference only and shall not be deemed to be part of this
Agreement.
14. SEVERABILITY
If any provision contained in this Agreement should be held to be invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained in this Agreement shall not
in any way be affected or impaired thereby.
15. GOVERNING LAW; JURISDICTION
This Agreement shall be governed by and construed in accordance with the laws of
the state of Delaware and the federal law of the United States of America. The
parties hereto hereby submit to the jurisdiction of the courts of the State of
Wisconsin, or of the United States of America sitting in the State of Wisconsin,
over any action, suit, or proceeding arising out of or relating to this
Agreement. Nothing herein shall affect the right of the Purchaser to serve
process in any manner permitted by law or limit the right of the Purchaser to
bring proceedings against the Company in the competent courts of any other
jurisdiction or jurisdictions.
16. NO CONFLICTS OF INTEREST.
The Company represents, warrants, and covenants that, to the best of its
knowledge, no trustee or employee of the State of Wisconsin Investment Board
identified on the attached list, either directly or indirectly (a) currently
holds, except as may be specifically set forth below, a personal interest in the
Company or any of its affiliates (together, the "Entity") or the Entity's
property or securities, or (b) will, in connection with the investment made
pursuant to this Agreement, receive (i) a personal interest in the Entity or the
Entity's property or securities or (ii) anything of substantial economic value
for his or her private benefit from the Entity or anyone acting on its behalf.
As to ownership of an interest in the Entity's publicly traded securities,
"knowledge" hereunder is based on an examination of record holders of the
Entity's securities and actual knowledge of the undersigned.
17. COUNTERPARTS
This Agreement may be executed in two or more counterparts, each of which shall
constitute an original, but all of which, when taken together, shall constitute
but one instrument, and shall become effective when one or more counterparts
have been signed by each party to this Agreement and delivered to the other
parties.
IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to be executed by their duly authorized representatives as of the day
and year first above written.
ULTRALIFE BATTERIES, INC.
BY: /s/ Robert W. Fishback, Vice President of Finance
PURCHASERS
The Purchasers set forth on SCHEDULE "A" attached
hereto have executed this Share Purchase Agreement.
SCHEDULE A
ULTRALIFE BATTERIES, INC. SHARE PURCHASE AGREEMENT
JULY 19, 2001
1. State of Wisconsin Investment Board 670,000 shares
Lake Terrace
121 East Wilson Street
PO Box 7842
Madison, WI 53707
2. Kimelman & Baird, LLC, as agent for 400,000 shares
those Investors set forth on Schedule 1
attached hereto - shares to be issued to the
Investors set forth on Schedule 1
100 Park Avenue, Suite 2120
New York, NY 10017
3. Fraser Management Associates, as agent for 20,000 shares
those Investors set forth on Schedule 2
attached hereto - shares to be issued to the
Investors set forth on Schedule 2
Box 494
309 S. Willard Street
Burlington, VT 05402
SCHEDULE 1
KIMELMAN & BAIRD, LLC
100 Park Avenue, Suite 2120
New York, New York 10017
Tel: 212-686-0021 Fax: 212-779-9603
Number of
Purchaser Name and Address Shares
-------------------------- ------
First Trust as trustee for 22,000
Sheila Baird SERP
100 Park Avenue
Suite 2120
New York, NY 10017
Weiss, Peck & Greer as trustee for 10,000
Sheila Baird IRA
100 Park Avenue
Suite 2120
New York, NY 10017
Weiss, Peck & Greer as trustee for 16,000
Murray Berliner Sep IRA
200 Winston Drive
Cliffside Park, NJ 07010
Weiss, Peck & Greer as trustee for 4,000
Stephan Bermas IRA
9 Shelter Bay Drive
Great Neck, NY 11024
William A. Birnbaum 16,000
1060 Lake Avenue
Greenwich, CT 06831
William Birnbaum & 16,000
Kathleen Birnbaum
1060 Lake Avenue
Greenwich, CT 06831
Schedule 1
(Continued)
Number of
Purchaser Name and Address Shares
-------------------------- ------
Harris J. Bixler 16,000
62 Bayside Road
Northport, ME 04849
Weiss, Peck & Greer as trustee for 4,000
John V. Brennan IRA
83 Eton Road
Garden City, New York 11530
Weiss, Peck & Greer as trustee for 8,000
Julie Connelly IRA
410 East 57th Street
New York, NY 10022
Katharine Crossgrove 8,000
133A Farnham Avenue
Toronto, Ontario M4V 1H7
Canada
Daeg Partners, LLP 92,000
100 Park Avenue
Suite 2120
New York, NY 10017
Donna Darnell 4,000
6 Skysail Drive
Corona Del Mar, CA 92625
Tirone E. David, M.D. 12,000
100 Dunvegan Road
Toronto, Ontario MV4 2P7
Canada
Weiss, Peck & Greer as trustee for 8,000
John W. Dewey, IRA
706 Commen Road
Waitsfield, VT 05673
Schedule 1
(continued)
Number of
Purchaser Name and Address Shares
-------------------------- ------
Weiss, Peck & Greer as trustee for 8,000
John Dorman IRA
44 Fairmount Road
Ridgewood, NJ 07450
Weiss, Peck & Greer as trustee for 8,000
Joan Ellenbogen IRA
142 West 57th Street
New York, NY 10019
Weiss, Peck & Greer as trustee for 4,000
Marcia Goldstein IRA
142 West 57th Street
New York, NY 10019
Martha Grant 8,000
150 Bessborough Drive
Toronto Ontario M4G 3J6
Canada
Claire S. Gulamerian 8,000
Living Trust dtd 6/7/96
32 Gramercy Park South
New York, NY 10003
Ingolstadt Ltd. BVI 16,000
c/o Kimelman & Baird LLC
100 Park Avenue
New York, NY 10017
Oscar Lascano 4,000
12 Cross Road
Brookfield, CT 06805
Schedule 1
(continued)
Number of
Purchaser Name and Address Shares
-------------------------- ------
Weiss, Peck & Greer as trustee for Stanley Mailman IRA 4,000
350 Central Park West
New York, NY 10025
Barbara V. May 4,000
7 Dusty Hollow Lane
Dorset, VT 05251
Weiss, Peck & Greer as trustee for 16,000
Bernadette Murphy IRA
100 Park Avenue
Suite 2120
New York, NY 10017
Joan Nazarro 4,000
200 Old Palisade Road
Apt. #26D
Fort Lee, NJ 07024
1004050 Ontario Inc. 4,000
c/o Pauline Scott
505 Island Park Drive
Ottawa Ontario K1Y 0B4
Canada
Arthur Panoff 8,000
c/o Donow McMullen & Panoff
271 Madison Avenue
New York, NY 10016
Patricia C. Remmer 16,000
Revocable Trust dtd 7/22/92
5000 Sawgrass Village Circle
Ponte Verda Beach, FL 32082
Schedule 1
(continued)
Number of
Purchaser Name and Address Shares
-------------------------- ------
Patricia C. Remmer 4,000
1995 Charitable Lead Trust
Susan R. Ryzewic ttee
5000 Sawgrass Village Circle
Suite 2
Ponte Verda Beach, FL 32082
The Remmer Family Foundation 4,000
c/o Susan R. Ryzewic
5000 Sawgrass Village Circle
Suite 2
Ponte Verda Beach, FL 32082
Weiss, Peck & Greer as trustee for 8,000
Dorothy Rivkin IRA
211 East 70th Street
Apt. #7G
New York, NY 10021
Maurice Schlossberg & 8,000
Amy Schlossberg
4151 S. Melpomene Way
Tucson, AZ 85730
Weiss, Peck & Greer as trustee for 4,000
Mary Simmons IRA
110 East 87th Street
Apt. #4B
New York, NY 10128
Weiss, Peck & Greer as trustee for 16,000
Richard R. Stebbins IRA
20 West 86th Street
New York, NY 10024
Sara Tough 4,000
25 Birchwood Avenue
Willowdale Ontario M2L 1M4
Canada
Weiss, Peck & Greer as trustee for 4,000
Leon Zeff IRA
177 19th Street
Oakland, CA 94612
Schedule 2
Purchaser Name and Address Number of Shares
-------------------------- ----------------
Charles W. Phillips 10,000
P.O. Box 183
Derby-Gore Road
Morgan, VT 05853
Richard F. Morton 5,000
220 S. Collier Blvd Apr. 1404
Marco Island, FL 34145
Neal P. Brooks 5,000
P.O. Box 900160
Homestead, FL 33090-0160
EXHIBIT A
[LOGO OMITTED]
HARTER SECREST & EMERY LLP
--------------------------
ATTORNEYS AND COUNSELORS
July 19, 2001
To the Purchasers of Common Stock
of Ultralife Batteries, Inc. Listed on
Exhibit A Attached Hereto
Ladies and Gentlemen:
We have acted as counsel to Ultralife Batteries, Inc., a Delaware corporation
(the "Company"), in connection with the issuance and sale to you of 1,090,000
shares of the Company's Common Stock (the "Shares") pursuant to the Ultralife
Batteries, Inc. Share Purchase Agreement dated as of July 19, 2001 between the
Company and each of the Purchasers listed on Exhibit A hereto (the "Agreement").
We are rendering this opinion pursuant to Section 3(d)(iii) of the Agreement.
Except as otherwise defined herein, capitalized terms used but not defined
herein shall have the respective meanings given to them in the Agreement.
In connection with this opinion, we have examined and relied upon the
representations and warranties as to factual matters contained in and made
pursuant to the Agreement by the various parties as well as contained in
certificates of officers of the Company, and originals or copies, certified to
our satisfaction, of such records, documents, certificates, opinions, memoranda
and other instruments as in our judgment are necessary or appropriate to enable
us to render the opinions expressed below. Where we render an opinion "to the
best of our knowledge" or concerning an item "known to us" or our opinion
otherwise refers to our knowledge, it is based solely upon (i) an inquiry of
attorneys within this firm who have performed legal services for the Company and
(ii) such other investigation, if any, that we specifically set forth herein.
Based upon and reliance on the foregoing, and subject to the assumptions and
qualifications hereinafter set forth, we are of the opinion that:
1. The Company is a corporation duly incorporated and, as of June 26,
2001, validly existing and in good standing under the laws of the State of
Delaware. The Company is duly licensed or qualified and in good standing as a
foreign corporation authorized to do business in all jurisdictions where the
character of the property owned or leased by it, or the nature of the activities
conducted by it, make such licensing or qualification necessary, except where
failure to so qualify would not have a material adverse effect on the Company's
results of operations. As
HARTER SECREST & EMERY LLP
--------------------------
ATTORNEYS AND COUNSELORS
Page 2
of June 18, 2001, the Company is duly qualified to do business and in good
standing as a foreign corporation under the laws of the State of New York. The
foregoing opinions are given solely on the basis of certificates of appropriate
state agencies in the states of Delaware and New York. In determining
appropriate state agencies we have relied, without further inquiry, on the
advice of CT Corporation System and Accelerated Information Document & Filing,
Inc. as to those agencies from which certificates should be received. The
foregoing opinion is limited to the meaning ascribed to such certificates by
each applicable state agency.
2. The Company has the corporate power and authority to own or lease its
properties and operate its business as now conducted, and to execute, deliver
and perform its obligations under the Agreement.
3. The Company's execution and delivery of, and its performance of its
obligations under the Agreement have been duly authorized by all necessary
corporate action on the part of the Company, and the Agreement has been duly
executed and delivered by the Company.
4. The Agreement is the valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms.
5. The Company's execution and delivery of, and the Company's performance
of its obligations under, the Agreement do not on this date (a) conflict with or
result in a breach of any provision of the Restated Certificate of
Incorporation, as amended, or By-laws, as amended, of the Company, or (b)
violate any existing law, rule, regulation or ordinance applicable to the
Company and affecting the enforceability of the Agreement, or (c) to our actual
knowledge without independent investigation (i) result in a breach of any of the
provisions of, or constitute a default under, or result in the creation or
imposition of a lien, charge or encumbrance upon any of the assets of the
Company pursuant to any agreement or instrument to which the Company is a party
or by which the Company or its assets is bound (assuming the laws of each
jurisdiction governing such agreement or instrument are the same as the laws of
the State of New York) or (ii) violate any existing judgment, order, writ,
injunction or decree expressly applicable to the Company.
6. To our actual knowledge, without independent investigation, there is no
action, suit or proceeding pending, or overtly threatened by written
communication, against the Company or expressly affecting it or its assets,
where an unfavorable decision, ruling or finding would materially adversely
affect the validity or enforceability of the Agreement, or the business,
operations, properties, or financial condition of the Company except as
disclosed in the Schedule of Exceptions to the Agreement and in the Company's
Form 10-Q for the quarter ended March 31, 2001.
7. As of the date hereof, the authorized capital stock of the Company
consists of 40,000,000 shares of Common Stock and 1,000,000 shares of Preferred
Stock. Relying solely on the certification of American Stock Transfer & Trust
Company, the issued and outstanding capital stock of the Company as of June 20,
2001 consists of 11,460,936 shares of Common
HARTER SECREST & EMERY LLP
--------------------------
ATTORNEYS AND COUNSELORS
Page 3
Stock and no shares of Preferred Stock. The sale, issuance and delivery of the
Shares pursuant to the Agreement have been duly authorized by all necessary
corporate action on the part of the Company. When issued, delivered and paid for
in accordance with the terms of the Agreement, the Shares will be validly
issued, fully paid and non-assessable and free of any pre-emptive or similar
rights.
8. Assuming the accuracy of the representations and warranties of the
Purchasers set forth in the Agreement, the offer and sale of the Shares by the
Company to the Purchasers is exempt from the registration requirements of the
Securities Act, subject to the timely filing of a Form D pursuant to Securities
and Exchange Commission Regulation D, and the qualification and registration
requirements of all applicable state securities and "blue sky" laws.
9. All consents, approvals, authorizations, or orders of, and filings,
registrations and qualifications with or required by any regulatory or
governmental body or authority in the United States necessary for the issuance
by the Company of the Shares as contemplated by the Agreement, have been made or
obtained, except for (i) the filing of a Form D pursuant to Securities and
Exchange Commission Regulation D, (ii) the filing of a Form D with the
Securities Commissioners of those states where the Purchasers reside, and (iii)
the filing of a Notice of Listing of Additional Shares with NASDAQ.
The foregoing opinions are subject to the following qualifications and are
based upon the following further assumptions:
(A) We have assumed, without any investigation, with respect to each
party thereto other than the Company (i) the full capacity, power
and authority of such party to execute, deliver and perform the
Agreement, (ii) the due execution and delivery of the Agreement by
such party, and (iii) the legality, validity and binding effect of
the Agreement with respect to such party.
(B) We have assumed without any investigation the genuineness of all
signatures, the legal capacity of natural persons, the authenticity
and completeness of all documents submitted to us as originals, the
conformity to original documents of all documents submitted to us as
certified, photostatic or telestatic copies, and the authenticity
and completeness of the originals of such copies.
(C) The foregoing opinions are subject to the effect of (i) applicable
bankruptcy, reorganization, insolvency, moratorium and/or similar
laws relating to or affecting the rights of creditors generally,
including without limitation fraudulent conveyance provisions under
applicable laws and (ii) equitable, constitutional and public policy
limitations (regardless of whether considered in a proceeding in
equity or at law).
(D) With respect to the performance by the Company of its obligations
under the Agreement with respect to the registration of the Shares,
we have assumed compliance by the Company at the time of such
performance with the registration requirements of the Securities Act
and with applicable state securities laws, and we disclaim any
opinion as to the validity or enforceability of the indemnification
provisions of the Agreement.
(E) We express no opinion with respect to the effect of any law other
than the law of the State of New York, the Delaware General
Corporation Law and the Federal law of the United
HARTER SECREST & EMERY LLP
--------------------------
ATTORNEYS AND COUNSELORS
Page 4
States, irrespective of any choice of law provisions which may be
contained in the Agreement.
This opinion is rendered solely to you and is intended solely for your
benefit in connection with the transaction described in this opinion, and may
not be relied upon, referred to or otherwise used by you for any other purpose,
or by any other person or entity.
Very truly yours,
/s/ HARTER, SECREST & EMERY LLP
EXHIBIT B
SCHEDULE OF EXCEPTIONS
SECTION 4.6 Environmental.
As disclosed in the Company's Form 10-K for the fiscal year ended June 30,
2000, in connection with the Company's purchase/lease of its Newark, New York
facility, a consulting firm performed a Phase I and II Environmental Site
Assessment which revealed the existence of contaminated soil around one of the
Company's buildings. The Company retained an engineering firm which estimated
that the cost of remediation should be in the range of $230,000; however, there
can be no assurance that this will be the case. In February 1998, the Company
entered into an agreement with a third party which provided that the Company and
the third party would retain an environmental consulting firm to verify the
existence of the contaminants and further delineate the nature of the
environmental concern. A voluntary investigation work plan of the site to fully
characterize the nature and extent of the contamination that was found during a
Phase II investigation is underway. The third party has agreed to reimburse the
Company for 50% of the cost associated with remediating the environmental
concern. There can be no assurance that the Company will not face claims
resulting in substantial liability which would have a material adverse effect on
the Company's business, financial condition and results of operations in the
period in which such claims are resolved.
Section 4.9 No Action.
As disclosed in the Company's Report on Form 10-Q for the quarter ended
March 31, 2001, in August 1998, the Company, its Directors, and certain
underwriters were named as defendants in a complaint filed in the United States
District Court for the District of New Jersey by certain shareholders,
purportedly on behalf of a class of shareholders, alleging that the defendants,
during the period April 30, 1998 through June 12, 1998, violated various
provisions of the federal securities laws in connection with an offering of
2,500,000 shares of the Company's Common Stock. The complaint alleged that the
Company's offering documents were materially incomplete, and as a result
misleading, and that the purported class members purchased the Company's Common
Stock at artificially inflated prices and were damaged thereby. Upon motion made
on behalf of the Company, the Court dismissed the shareholder action, without
prejudice, allowing the complaint to be refiled. The shareholder action was
subsequently refiled, asserting substantially the same claims as in the prior
pleading. The Company again moved to dismiss the complaint. By Opinion and Order
dated September 28, 2000, the Court dismissed the action, this time with
prejudice, thereby barring plaintiffs from any further amendments to their
complaint and directing that the case be closed. Plaintiffs filed a Notice of
Appeal to the Third Circuit Court of Appeals, the parties submitted their
briefs, and oral argument, originally scheduled for the week of May 21, 2001,
has been suspended pending further discussions with the Court. The Company
believes that the litigation is without merit and will continue to defend it
vigorously. The amount of alleged damages, if any, cannot be quantified, nor can
the outcome of this litigation be predicted. Accordingly, management cannot
determine whether the ultimate resolution of this litigation could have a
material adverse effect on the Company's financial position and results of
operations.
EXHIBIT C
TRUSTEES OF THE STATE OF WISCONSIN INVESTMENT BOARD
Jon D. Hammes Wayne McCaffery
John Petersen III George F. Lightbourn
Eric O. Stanchfield James R. Nelsen
Andrea Steen Crawford William R. Sauey
James A. Senty
RELEVANT EMPLOYEES OF THE STATE OF WISCONSIN INVESTMENT BOARD
All Transactions
Patricia Lipton Executive Director
Joseph Gorman Chief Investment Officer - Equities
Keith Johnson Chief Legal Counsel
Teresa Lau Assistant Legal Counsel
Cynthia Richson Assistant Legal Counsel
Jon Traver Chief Investment Officer - Fixed Income
For Real Estate Transactions
Robert Severance Investment Director
Chuck Carpenter Assistant Investment Director
Dave Lewandowski Investment Officer
Steve Spiekerman Investment Officer
For Private Placement Loans
Jim Gannon Investment Director
Eve Hennessee Portfolio Manager
Monica Jaehnig Portfolio Manager
For Private Placement Funds & Equity Investments
Jim Gannon Investment Director
Jon Vanderploeg Portfolio Manager
Carrie Thome Assistant Portfolio Manager
Tom Olson Investment Officer
or Non-traditional Investments
Mike Wagner Investment Director
Tom Drake Securities Analyst
For Small Cap Portfolio Direct Placements
John Nelson Investment Director
Chad Neumann Assistant Portfolio Manager
Jackie Doeler Securities Analyst
Mark Traster Securities Analyst
Dan Kane Securities Analyst
APPENDIX I
ULTRALIFE BATTERIES, INC.
STOCK CERTIFICATE QUESTIONNAIRE
Pursuant to Section 3 of the Agreement, please provide us with the following
information:
1. The exact name that your Shares are to be registered in (this is the name
that will appear on your stock certificate(s)). You may use a nominee name
if appropriate:
-----------------------------------------------------
2. The relationship between the Purchaser of the Shares and the Registered
Holder listed in response to item 1 above:
--------------------------
3. The mailing address of the Registered Holder listed in response to item 1
above:
-----------------------------------------------------
-----------------------------------------------------
-----------------------------------------------------
-----------------------------------------------------
4. The Social Security Number or Tax Identification Number of the Registered
Holder listed in response to item 1 above:
--------------------------
APPENDIX II
ULTRALIFE BATTERIES, INC.
REGISTRATION STATEMENT QUESTIONNAIRE
In connection with the preparation of the Registration Statement, please provide
us with the following information:
5. Pursuant to the "Selling Stockholder" section of the Registration
Statement, please state your or your organization's name exactly as it
should appear in the Registration Statement:
-----------------------------------------------------------------------
6. Please provide the number of shares that you or your organization will own
immediately after Closing, including those Shares purchased by you or your
organization pursuant to this Purchase Agreement and those shares
purchased by you or your organization through other transactions:
-----------------------------------------------------------------------
7. Have you or your organization had any position, office or other material
relationship within the past three years with the Company or its
affiliates?
_____ Yes _____ No
If yes, please indicate the nature of any such relationships below:
-----------------------------------------------------------------------
-----------------------------------------------------------------------
-----------------------------------------------------------------------
-----------------------------------------------------------------------
APPENDIX III
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
The undersigned, an officer of, or other person duly authorized by
- --------------------------------------------------------------------------------
[fill in official name of individual or institution]
hereby certifies that he/she/it is the Purchaser of the shares evidenced by the
attached certificate, and as such, sold such shares on ________________, 200__
in accordance with Registration Statement number 333-________________, and
complied with the requirement of delivering a current prospectus in connection
with such sale.
Print or Type:
Name of Purchaser (Individual or Institution):
- --------------------------------------------------------------------------------
Name of Individual representing Purchaser (if an Institution)
- --------------------------------------------------------------------------------
Title of Individual representing Purchaser (if an Institution):
- --------------------------------------------------------------------------------
Signature:
Individual Purchaser or Individual representing Purchaser:
- --------------------------------------------------------------------------------
Exhibit 2.2
WARRANT AGREEMENT
DATED AS OF JULY 20, 2001
BY AND BETWEEN
ULTRALIFE BATTERIES, INC.
AND
H.C. WAINWRIGHT & CO., INC.
WARRANT AGREEMENT
TABLE OF CONTENTS(1)
Page
- ----
SECTION 1. Warrant Certificates............................................1
SECTION 2. Execution of Warrant Certificates...............................1
SECTION 3. Registration of Transfers and Exchanges.........................1
SECTION 4. Terms of Warrants; Exercise of Warrants.........................2
SECTION 5. Payment of Taxes................................................3
SECTION 6. Mutilated or Missing Warrant Certificates.......................4
SECTION 7. Reservation of Warrant Shares...................................4
SECTION 8. Obtaining Stock Exchange Listings...............................4
SECTION 9. Adjustment of Exercise Price and Number
of Warrant Shares Issuable......................................5
SECTION 10. Fractional Interests............................................6
SECTION 11. Notices to Warrant holders......................................7
SECTION 12. Notices to Company..............................................7
SECTION 13. Supplements and Amendments......................................7
SECTION 14. Successors......................................................7
SECTION 15. Termination.....................................................7
SECTION 16. Governing Law...................................................7
SECTION 17. Benefits of This Agreement......................................7
SECTION 18. Headings; Counterparts..........................................7
- ----------
1 This Table of Contents does not constitute a part of this Agreement or
have any bearing upon the interpretation of any of its terms or
provisions.
WARRANT AGREEMENT, dated as of July 20, 2001, between Ultralife Batteries
Inc., a Delaware corporation (the "Company"), H.C. Wainwright & Co., Inc. (the
"Agent") and the individual affiliates of the Agent identified on Schedule A
attached hereto (the "Wainwright Affiliates") (the Agent and the Wainright
Affiliates collectively referred to as the "Warrantholders").
WHEREAS, the Company proposes to issue to the Warrantholders Common Stock
Purchase Warrants as hereinafter described (the "Warrants"), to purchase up to
109,000 shares of common stock, par value $.10 per share (the "Common Stock") of
the Company (the Common Stock issuable on exercise of the Warrants being
referred to herein as the "Warrant Shares"), as set forth on Schedule A, in
consideration of the services rendered by the Agent in connection with the
Company's private placement of certain shares of its Common Stock.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereto agree as follows:
SECTION 1. Warrant Certificates. The certificates evidencing the Warrants (the
"Warrant Certificates") to be delivered pursuant to this Agreement shall be in
substantially the form set forth in Exhibit A attached hereto.
SECTION 2. Execution of Warrant Certificates. Warrant Certificates shall be
signed on behalf of the Company by its President or its Chief Financial Officer
and by its Secretary or an Assistant Secretary and shall be dated the date of
signature by the Company. The Company may deem and treat the registered
holder(s) of the Warrant Certificates as the absolute owner(s) thereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone), for all purposes, and the Company shall not be affected by any notice
to the contrary.
SECTION 3. Registration of Transfers and Exchanges.
(a) The Company shall from time to time, subject to the limitations of
Section 4, register the transfer of any portion or all of any outstanding
Warrant Certificate upon the records to be maintained by it for that purpose,
upon surrender thereof duly endorsed or accompanied (if so required by it) by a
written instrument or instruments of transfer in form satisfactory to the
Company, duly executed by the registered holder or holders thereof or by the
duly appointed legal representative thereof or by a duly authorized attorney.
Upon any such registration of transfer, a new Warrant Certificate shall be
issued to the transferee(s) and the surrendered Warrant Certificate shall be
cancelled by the Company.
(b) The Agent agrees, and by receiving a Warrant Certificate, each
Warrant-holder agrees, that prior to any proposed transfer of the Warrant or of
the Warrant Shares, if such transfer is not made pursuant to an effective
Registration Statement under the Securities Act of 1933, as amended (the "Act"),
or an opinion of counsel that the Warrants or Warrant Shares may be transferred
without registration under the Act, the Warrantholder will deliver to the
Company:
(1) an investment covenant reasonably satisfactory to the Company
signed by the proposed transferee;
(2) an agreement by such transferee to the impression of the
restrictive investment legend set forth below on the Warrant or the
Warrant Shares;
(3) an agreement by such transferee to be bound by the provisions of
this Agreement.
The Agent agrees and each Warrantholder agrees that each certificate
representing Warrant Shares will bear a legend in substantially the
following form unless at the time the Warrant is exercised there is an
effective Registration Statement under the Act with respect to the Warrant
Shares:
"The securities evidenced or constituted hereby have been acquired
for investment and have not been registered under the Securities Act
of 1933, as amended. Such securities may not be sold, transferred,
pledged or hypothecated unless the registration provisions of said
Act have been complied with or unless the Company has received an
opinion of counsel reasonably satisfactory to the Company that such
registration is not required."
(c) Subject to the terms of this Agreement, Warrant Certificates may be
exchanged at the option of the holder(s) thereof, when surrendered to the
Company at its principal office, which is currently located at the address
listed in Section 12 hereof, for another Warrant Certificate or other Warrant
Certificates of like tenor and representing in the aggregate a like number of
Warrants. Any holder desiring to exchange a Warrant Certificate shall deliver a
written request to the Company, and shall surrender, duly endorsed or
accompanied (if so required by the Company) by a written instrument or
instruments of transfer in form satisfactory to the Company, the Warrant
Certificate or Certificates to be so exchanged. Warrant Certificates surrendered
for exchange shall be cancelled by the Company.
SECTION 4. Terms of Warrants; Exercise of Warrants.
(a) The initial exercise price per share at which Warrant Shares shall be
purchasable upon the exercise of the Warrants (the "Exercise Price") shall be
equal to $6.25 per share. Each Warrant shall be initially exercisable for one
share of Common Stock. Each Warrant Certificate shall represent that number of
Warrants set forth on the Warrant Certificate.
Subject to the terms of this Agreement, each Warrantholder shall have the right,
from the date of issuance of the Warrants until 5:00 p.m., New York City time on
July 20, 2006 (the "Exercise Period"), to receive from the Company the number of
fully paid and nonassessable Warrant Shares which the Warrantholder may at the
time be entitled to receive on exercise of the Warrants and payment of the
Exercise Price then in effect for such Warrant Shares. If not exercised prior to
5:00 p.m., New York City time, on July 20, 2006, the Warrants shall become void
and all rights thereunder and all rights in respect thereof under this Agreement
shall cease as of such time.
(b) The Warrants may be exercised upon surrender to the Company at its
principal office, which is currently located at the address listed in Section 12
hereof, of the Warrant Certificate or Certificates evidencing the Warrants to be
exercised with the form of election to purchase on the reverse thereof duly
filled in and signed, which signature shall be guaranteed by a participant in a
recognized Signature Guarantee Medallion Program and such other documentation as
the Company may reasonably request, and upon payment to the Company for the
account of the Company of the Exercise Price which is set forth in the form of
Warrant Certificate attached hereto as Exhibit A as adjusted as herein provided,
for the number of Warrant Shares in respect of which such Warrants are then
exercised. Subject to the provisions of Section 4(c) hereof, payment of the
aggregate Exercise Price shall be made in cash or by certified or official bank
check payable to the order of the Company in New York Clearing House Funds.
(c) Subject to the time limitations set forth in subsections (i) and (ii)
below, if at the time a Warrantholder exercises any Warrants hereunder, the
Company does not have in effect a current Registration Statement with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended (the "Act"), the Warrantholder may choose one of the
following, but not both:
(i) At any time after the initial effectiveness of the Registration
Statement contemplated by Section 8(b), rather than paying the aggregate
Exercise Price in cash or by certified or official bank check in
accordance with provisions of Section 4(b) above, the Warrantholder shall
be entitled to effect a "cashless exercise" as described in this Section
4(c)(i). For the purposes of this Section 4(c)(i), a "cashless exercise"
shall mean an exercise of a Warrant where the payment of the Exercise
Price is made with Warrant Shares issuable upon exercise of a Warrant,
which Warrant Shares shall be
2
valued at the Fair Market Value (as defined below) of the Common Stock on
the date of exercise. For purposes hereof, the "Fair Market Value" of the
Common Stock shall mean the closing price of the Common Stock on the
NASDAQ Stock Market (or any successor stock market) for the day on which
the notice of exercise is sent or delivered. In the event of a Cashless
Exercise, the number of Warrant Shares issuable to the Warrantholder shall
be determined using the following formula:
X = Y (A - B)/A
where: X = the number of Warrant Shares to be issued to the Warrantholder on
exercise:
Y = the number of Warrant Shares purchasable under the Warrants surrendered
A = the Fair Market Value of the Common Stock on the date of exercise; and
B = the then current Exercise Price of the Warrant; or
(ii) At any time after October 18, 2001, upon payment of the
aggregate Exercise Price in cash or by certified or official bank check in
accordance with the provisions of Section 4(b) above, the Warrantholder
shall be entitled to receive from the Company liquidated damages in an
amount equal to 0.25% of the total Exercise Price paid by the holder of
the Warrant Shares upon exercise of the Warrants for each week that the
Registration Statement is not effective, which amount shall be paid to the
Warrantholder at the end of each such week.
(d) Subject to the provisions of Section 5 hereof, upon such surrender of
Warrants and payment of the Exercise Price, the Company shall issue and cause to
be delivered within five business days to and in such name or names as the
Warrantholder may designate a certificate or certificates for the number of full
Warrant Shares issuable upon the exercise of such Warrants; provided, however,
that if any consolidation, merger or lease or sale of assets is proposed to be
effected by the Company as described in subsection (c) of Section 9 hereof, or a
tender offer or an exchange offer for shares of Common Stock of the Company
shall be made, upon such surrender of the Warrants and payment of the Exercise
Price as aforesaid, the Company shall, as soon as possible, but in any event not
later than two business days thereafter, issue and cause to be delivered the
full number of Warrant Shares issuable upon the exercise of such Warrants in the
manner described in this sentence. Such certificate or certificates shall be
deemed to have been issued and any person so designated to be named therein
shall be deemed to have become a holder of record of such Warrant Shares as of
the date of the surrender of such Warrants and payment of the Exercise Price.
(e) The Warrants shall be exercisable, at the election of the holders
thereof, either in full or from time to time in part and, in the event that a
certificate evidencing Warrants is exercised in respect of fewer than all of the
Warrant Shares issuable on such exercise at any time prior to the date of
expiration of the Warrants, a new certificate evidencing the remaining Warrants
will be issued. The Company may assume that any Warrant presented for exercise
is permitted to be so exercised under applicable law and shall have no liability
for acting in reliance on such assumption.
(f) All Warrant Certificates surrendered upon exercise of Warrants shall
be cancelled by the Company.
(g) The Company shall keep copies of this Agreement and any notices given
or received hereunder available for inspection by the Warrantholders with
reasonable prior written notice during normal business hours at its office.
SECTION 5. Payment of Taxes. The Company will pay all documentary stamp taxes
attributable to the initial issuance of Warrant Shares upon the exercise of
Warrants; provided, however, that the Company shall not be required to pay any
tax or taxes which may be payable in respect of any transfer involved in the
issue of any Warrant Certificates or any certificates for Warrant Shares in a
name other than that of the registered holder of a Warrant Certificate
surrendered upon the exercise of a Warrant, and the Company shall not be
required to issue or deliver such Warrant Certificates unless or until the
person
3
or persons requesting the issuance thereof shall have paid to the Company the
amount of such tax or shall have established to the satisfaction of the Company
that such tax has been paid.
SECTION 6. Mutilated or Missing Warrant Certificates. In case any Warrant
Certificate shall be mutilated, lost, stolen or destroyed, the Company may in
its discretion issue, in exchange and substitution for and upon cancellation of
the mutilated Warrant Certificate, or in lieu of and substitution for the
Warrant Certificate lost, stolen or destroyed, a new Warrant Certificate of like
tenor and representing an equivalent number of Warrants, but only upon receipt
of evidence satisfactory to the Company of such loss, theft or destruction of
such Warrant Certificate and indemnity, if requested, also satisfactory to the
Company. Applicants for such substitute Warrant Certificates shall also comply
with such other reasonable regulations and pay such other reasonable charges as
the Company may prescribe.
SECTION 7. Reservation of Warrant Shares.
(a) The Company will at all times reserve and keep available, free from
preemptive rights, out of the aggregate of its authorized but unissued Common
Stock or its authorized and issued Common Stock held in its treasury, for the
purpose of enabling it to satisfy any obligation to issue Warrant Shares upon
exercise of Warrants, the maximum number of shares of Common Stock which may
then be deliverable upon the exercise of all outstanding Warrants.
(b) The Company or, if appointed, the transfer agent for the Common Stock
(the "Transfer Agent") and every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of any of the rights of
purchase aforesaid will be irrevocably authorized and directed at all times to
reserve such number of authorized shares as shall be required for such purpose.
The Company will keep a copy of this Agreement on file with the Transfer Agent
and with every subsequent transfer agent for any shares of the Company's capital
stock issuable upon the exercise of the rights of purchase represented by the
Warrants. The Company will supply such Transfer Agent with duly executed
certificates for such purposes. The Company will furnish such Transfer Agent a
copy of all notices of adjustments and certificates related thereto, transmitted
to each Warrantholder pursuant to Section 12 hereof.
(c) Before taking any action which would cause an adjustment pursuant to
Section 9 hereof to reduce the Exercise Price below the then par value (if any)
of the Warrant Shares, the Company will take any corporate action which may, in
the opinion of its counsel (which may be counsel employed by the Company), be
necessary in order that the Company may validly and legally issue fully paid and
nonassessable Warrant Shares at the Exercise Price as so adjusted.
(d) The Company covenants that all Warrant Shares which may be issued upon
exercise of Warrants will, upon payment of the Exercise Price therefor and
issue, be fully paid, nonassessable, free of preemptive rights and free from all
taxes, liens, charges and security interests with respect to the issue thereof.
SECTION 8. Obtaining Stock Exchange Listings; Registration of Warrant Shares.
(a) The Company will from time to time take all action which may be
necessary so that the Warrant Shares, immediately upon their issuance upon the
exercise of Warrants, will be listed on the principal securities exchanges and
markets within the United States of America, if any, on which other shares of
Common Stock are then listed.
(b) The Company agrees with the Agent and each Warrantholder to include
the Warrant Shares in the Registration Statement (as defined in that certain
Share Purchase Agreement dated July 19, 2001 (the "Purchase Agreement")) by and
among the Company and the purchasers identified on Schedule A to that Purchase
Agreement required by Section 7 of the Purchase Agreement, and the provisions
set forth in Section 7 of the Purchase Agreement as they relate to the
Registration Statement shall apply with full
4
force and effect to the Warrantholders who shall, for purposes of that Section 7
be deemed Purchasers, and the Warrant Shares to be included in the Registration
Statement, except that with respect to the Warrant Shares, the obligation of the
Company to keep the Registration Statement effective shall expire on the earlier
of (i) the date on which all of the Warrant Shares have been sold pursuant to
the Registration Statement or (ii) July 20, 2007. The indemnification provisions
of Section 7.3 of the Purchase Agreement are hereby incorporated by reference
with each Warrantholder being deemed a Purchaser for purposes of the provisions
of that Section 7.3.
SECTION 9. Adjustment of Exercise Price and Number of Warrant Shares Issuable.
The Exercise Price and the number of Warrant Shares issuable upon the exercise
of Warrants are subject to adjustment from time to time upon the occurrence of
the events enumerated in this Section 9. With respect to any Warrant, no
adjustment to the Exercise Price or to the number of Warrant Shares issuable
upon exercise shall be made for any event enumerated in this Section 9 if the
date as to which the Company committed to undertake such event was prior to such
Warrant's issuance. For purposes of this Section 9, "Common Stock" means shares
now or hereafter authorized of any class of common stock of the Company and any
other stock of the Company, however designated, that has the right (subject to
any prior rights of any class or series of preferred stock) to participate in
any distribution of the assets or earnings of the Company without limit as to
per share amount.
(a) Adjustment for Change in Capital Stock.
If the Company:
(1) pays a dividend or makes a distribution on its Common Stock in
shares of its Common Stock;
(2) subdivides its outstanding shares of Common Stock into a greater
number of shares;
(3) combines its outstanding shares of Common Stock into a smaller
number of shares;
(4) makes a distribution on its Common Stock in shares of its
capital stock other than Common Stock; or
(5) issues by reclassification of its Common Stock any shares of its
capital stock;
then the Warrants in effect immediately prior to such action shall
be proportionately adjusted so that the holder of any Warrant thereafter
exercised may receive the aggregate number and kind of shares of capital
stock of the Company which he would have owned immediately following such
action if such Warrant had been exercised immediately prior to such
action. The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or
reclassification. Such adjustment shall be made successively whenever any
event listed above shall occur.
(b) When De Minimis Adjustment May Be Deferred.
No adjustment in the Exercise Price need be made unless the adjustment would
require an increase or decrease of at least 1% in the Exercise Price. Any
adjustments that are not made shall be carried forward and taken into account in
any subsequent adjustment.
All calculations under this Section 9 shall be made to the nearest cent or to
the nearest 1/100th of a share, as the case may be.
5
(c) Reorganization of Company.
If the Company consolidates or merges with or into, or transfers or leases all
or substantially all its assets to (each, a "Reorganization Transaction"), any
person, upon consummation of such transaction the Warrants shall automatically
become exercisable for the kind and amount of securities, cash or other assets
which the holder of the Warrants would have owned immediately after the
consolidation, merger, transfer or lease if the holder had exercised the
Warrants immediately before the effective date of the Reorganization
Transaction.
(d) When Issuance or Payment May Be Deferred.
In any case in which this Section 9 shall require that an adjustment in the
Exercise Price be made effective as of a record date for a specified event, the
Company may elect to defer until the occurrence of such event issuing to the
holder of any Warrant exercised after such record date the Warrant Shares and
other capital stock of the Company, if any, issuable upon such exercise over and
above the Warrant Shares and other capital stock of the Company, if any,
issuable upon such exercise on the basis of the Exercise Price; provided,
however, that the Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to receive such additional
Warrant Shares and other capital stock upon the occurrence of the event
requiring such adjustment.
(e) Adjustment in Number of Shares.
Upon each event that provides for an adjustment of the Exercise Price pursuant
to this Section 9, each Warrant outstanding prior to the making of the
adjustment shall thereafter evidence the right to receive upon payment of the
adjusted Exercise Price that number of shares of Common Stock obtained from the
following formula:
N' = N x E
-
E'
where:
N'= the adjusted number of Warrant Shares issuable upon exercise of a
Warrant by payment of the adjusted Exercise Price.
N = the number of Warrant Shares previously issuable upon exercise of
a Warrant by payment of the Exercise Price prior to adjustment.
E'= the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
(f) Form of Warrants.
Irrespective of any adjustments in the Exercise Price or the number or kind of
shares purchasable upon the exercise of Warrants, Warrants theretofore or
thereafter issued may continue to express the same price and number and kind of
shares as are stated in the Warrants initially issuable pursuant to this
Agreement.
6
SECTION 10. Notices to Warrant Holders. Upon any adjustment of the Exercise
Price pursuant to Section 9, the Company shall promptly thereafter, or within
five days, cause to be given to each of the registered holders of the Warrant
Certificates at his address appearing on the Warrant register written notice of
such adjustments by first-class mail, postage prepaid. Where appropriate, such
notice may be given in advance and included as a part of the notice required to
be mailed under the other provisions of this Section 10.
SECTION 11. Notices to Company. Any notice or demand authorized by this
Agreement to be given or made by the registered holder of any Warrant
Certificate to or on the Company shall be sufficiently given or made when and if
deposited in the mail, first class or registered, postage prepaid, addressed
(until another address is provided in writing by the Company), as follows:
Ultralife Batteries, Inc.
2000 Technology Parkway
Newark, NY 14513
Facsimile No.: 315-331-3925
Attn: Robert W. Fishback, Vice President of
Finance and Chief Financial Officer
SECTION 12. Supplements and Amendments. The Company may from time to time
supplement or amend this Agreement (a) without the approval of any holders of
Warrant Certificates in order to cure any ambiguity or to correct or supplement
any provision contained herein which may be defective or inconsistent with any
other provision herein, or to make any other provisions in regard to matters or
questions arising hereunder which the Company may deem necessary or desirable
and which shall not in any way adversely affect the interests of the holders, or
(b) with the approval of the holders of a majority of the Warrants outstanding.
SECTION 13. Successors. All the covenants and provisions of this Agreement by or
for the benefit of the Company shall be binding and inure to the benefit of its
respective successors and assigns hereunder. For the purposes of this Agreement,
Warrantholders shall mean any individual identified on Schedule A and any
permitted successor or assign of such Warrantholder who has properly received a
Warrant Certificate in accordance with the provisions of this Agreement.
SECTION 14. Termination. This Agreement will terminate on any earlier date if
all Warrants have been exercised or expired without exercise; subject, however,
to the provision that the provisions of Section 8(b) shall survive the
termination of this Agreement.
SECTION 15. Governing Law. This Agreement and each Warrant Certificate issued
hereunder shall be deemed to be a contract made under the laws of the State of
New York and for all purposes shall be construed in accordance with the internal
laws of said State.
SECTION 16. Benefits of This Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company, the Agent
and the registered holders of the Warrant Certificates any legal or equitable
right, remedy or claim under this Agreement. This Agreement shall be for the
sole and exclusive benefit of the Company and the registered holders of the
Warrant Certificates. The Agent agrees to obtain the signatures of all
Warrantholders identified on Schedule A hereto on counterparts of this Agreement
and deliver such counterpart signature pages promptly to the Company. No
Warrantholder shall be entitled to the benefits of this Agreement until he has
signed a counterpart of this Agreement.
SECTION 17. Headings; Counterparts. The headings and captions contained herein
are for convenience of reference only and shall not control or affect the
meaning or construction of any provision hereof. This Agreement may be executed
in any number of counterparts and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall together
constitute but one and the same instrument.
[Signature Page Follows]
7
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
Ultralife Batteries, Inc.
By: /s/ Robert W. Fishback
--------------------------
Robert W. Fishback
Vice President of Finance and
Chief Financial Officer
H.C. WAINWRIGHT & CO., INC.
By: /s/Eric Singer
--------------------------
Eric Singer
Managing Director
8
EXHIBIT A
[Form of Warrant Certificate]
[Face]
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED. SAID SECURITIES MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER
SAID ACT.
EXERCISABLE ON OR BEFORE 5:00 P.M. NEW YORK CITY TIME ON JULY 20, 2006.
No. _____
Warrant Certificate
Ultralife Batteries, Inc.
This Warrant Certificate certifies that ________________________, or registered
assigns, is the registered holder of ________Warrants expiring July 20, 2006
(the "Warrants") to purchase Common Stock, $.10 par value (the "Common Stock"),
of Ultralife Batteries, Inc., a Delaware corporation (the "Company"). Each
Warrant entitles the holder upon exercise to receive from the Company on or
before 5:00 p.m. New York City Time on July 20, 2006 that number of fully paid
and nonassessable shares of Common Stock (each, a "Warrant Share") as set forth
below at the exercise price (the "Exercise Price") as determined pursuant to the
Warrant Agreement referenced below payable in lawful money of the United States
of America upon surrender of this Warrant Certificate and payment of the
Exercise Price at the office of the Company, but only subject to the conditions
set forth herein and in the Warrant Agreement referred to on the reverse hereof.
The Exercise Price and number of Warrant Shares issuable upon exercise of the
Warrants are subject to adjustment upon the occurrence of certain events set
forth in the Warrant Agreement.
Each Warrant is initially exercisable for one share of Common Stock. The initial
Exercise Price for any Warrant shall be $6.25. No warrant may be exercised after
5:00 p.m. New York City Time on July 20, 2006 and to the extent not exercised by
such time such Warrants shall become void.
Reference is hereby made to the further provisions of this Warrant Certificate
set forth on the reverse hereof and such further provisions shall for all
purposes have the same effect as though fully set forth at this place.
This Warrant Certificate shall be governed and construed in accordance with the
internal laws of the State of New York.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be signed
by its President or Chief Financial Officer and by its Secretary or Assistant
Secretary.
ULTRALIFE BATTERIES, INC.
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
2
[Form of Warrant Certificate]
[Reverse]
The Warrants evidenced by this Warrant Certificate are part of a duly authorized
issue of Warrants expiring July 20, 2006 entitling the holder on exercise to
receive shares of Common Stock, par value $.10 per share, of the Company (the
"Common Stock") and are issued or to be issued pursuant to a Warrant Agreement,
dated as of July 20, 2001 (the "Warrant Agreement"), duly executed and delivered
by the Company, which Warrant Agreement is hereby incorporated by reference in
and made a part of this instrument and is hereby referred to for a description
of the rights, limitation of rights, obligations, duties and immunities
thereunder of the Company and the holders (the words "holders" or "holder"
meaning the registered holders or registered holder) of the Warrants. A copy of
the Warrant Agreement may be obtained by the holder hereof upon written request
to the Company.
Warrants may be exercised at any time on or before 5:00 p.m. New York City time
on July 20, 2006. The holder of Warrants evidenced by this Warrant Certificate
may exercise them by surrendering this Warrant Certificate, with the form of
election to purchase set forth hereon properly completed and executed, together
with payment of the Exercise Price as specified in the Warrant Agreement at the
office of the Company. In the event that upon any exercise of Warrants evidenced
hereby the number of Warrants exercised shall be less than the total number of
Warrants evidenced hereby, there shall be issued to the holder hereof or his
assignee a new Warrant Certificate evidencing the number of Warrants not
exercised. No adjustment shall be made for any dividends on any Common Stock
issuable upon exercise of this Warrant.
The Warrant Agreement provides that upon the occurrence of certain events the
Exercise Price set forth on the face hereof may, subject to certain conditions,
be adjusted. If the Exercise Price is adjusted, the Warrant Agreement provides
that the number of shares of Common Stock issuable upon the exercise of each
Warrant shall be adjusted. No fractions of a share of Common Stock will be
issued upon the exercise of any Warrant.
The holders of the Warrants are entitled to certain registration rights with
respect to the Warrant Shares purchasable upon exercise thereof as set forth in
full in the Warrant Agreement.
Warrant Certificates, when surrendered at the office of the Company by the
registered holder thereof in person or by legal representative or attorney duly
authorized in writing, may be exchanged, in the manner and subject to the
limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant Certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Warrants.
Upon due presentation for registration of transfer of this Warrant Certificate
at the office of the Company a new Warrant Certificate or Warrant Certificates
of like tenor and evidencing in the aggregate a like number of Warrants shall be
issued to the transferee(s) in exchange for this Warrant Certificate, subject to
the limitations provided in the Warrant Agreement, without charge except for any
tax or other governmental charge imposed in connection therewith.
The Company may deem and treat the registered holder(s) thereof as the absolute
owner(s) of this Warrant Certificate (notwithstanding any notation of ownership
or other writing hereon made by anyone), for the purpose of any exercise hereof,
of any distribution to the holder(s) hereof, and for all other purposes, and the
Company shall not be affected by any notice to the contrary. Neither the
Warrants nor this Warrant Certificate entitles any holder hereof to any rights
of a stockholder of the Company.
3
Election to Purchase
(to be executed upon exercise of warrant)
The undersigned hereby irrevocably elects to exercise the right, represented by
this Warrant Certificate, to receive __________ shares of Common Stock and
herewith tenders payment for such shares to the order of Ultralife Batteries,
Inc. in the amount of $______ in accordance with the terms hereof. The
undersigned requests that a certificate for such shares be registered in the
name of ________________, whose address is __________________________ and that
such shares be delivered to ________________ whose address is ___________
______________________. If said number of shares is less than all of the shares
of Common Stock purchasable hereunder, the undersigned requests that a new
Warrant Certificate representing the remaining balance of such shares be
registered in the name of ______________, whose address is
_________________________, and that such Warrant Certificate be delivered to
_________________, whose address is __________________.
Signature:
Date:
Signature Guaranteed:
4
Exhibit 5
August 17, 2001
Ultralife Batteries, Inc.
2000 Technology Parkway
Newark, New York 14513
Re: Ultralife Batteries, Inc.
Registration Statement on Form S-3
Ladies and Gentlemen:
You have requested our opinion in connection with your Registration
Statement on Form S-3, filed under the Securities Act of 1933, as amended, with
the Securities and Exchange Commission (the "Registration Statement"), in
respect of a resale offering of an aggregate of 1,090,000 authorized and issued
shares of the Common Stock, par value $.10 per share (the "Common Stock"), of
Ultralife Batteries, Inc. (the "Corporation"), which may be sold by certain
stockholders of the Corporation and 109,000 shares of Common Stock to be issued
upon the exercise of certain warrants to purchase the Corporation's Common
Stock.
We have examined the following corporate records and proceedings of the
Corporation in connection with the preparation of this opinion: its Certificate
of Incorporation; its By-laws as currently in force and effect; its Minute
Books, containing minutes and records of other proceedings of its stockholders
and its Board of Directors, from the date of incorporation to the date hereof;
the Registration Statement; applicable provisions of the laws of the State of
Delaware; and such other documents and matters as we have deemed necessary.
In rendering this opinion, we have made such examination of laws as we
have deemed relevant for the purposes hereof. As to various questions of fact
material to this opinion, we have relied upon representations and/or
certificates of officers of the Corporation, certificates and documents issued
by public officials and authorities, and information received from searchers of
public records.
Based upon and in reliance on the foregoing, we are of the opinion that:
1. The Corporation has been duly incorporated and is validly
existing under the laws of the State of Delaware.
2. The Corporation had the authority to issue an aggregate of
1,090,000 shares of Common Stock and to authorize the issuance of an
aggregate 109,000 shares of Common Stock upon exercise of the warrants.
3. The 1,090,000 shares of Common Stock issued by the Corporation
and registered pursuant to the Registration Statement were legally and
validly issued, and are fully paid and non-assessable, and the warrants
have been legally and validly issued, and upon issuance in accordance with
the terms and provisions of the warrants, the shares of Common Stock
issued upon exercise of the warrants will be legally and validly issued,
and will be fully paid and non-assessable.
We hereby consent to be named in the Registration Statement as attorneys
passing upon legal matters in connection with the registration of the 1,199,000
shares of Common Stock covered thereby, and we hereby consent to the filing of
this opinion as Exhibit 5 to the Registration Statement.
Very truly yours,
/s/ HARTER, SECREST & EMERY LLP
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated August 10, 2000
included in Ultralife Batteries Inc.'s Form 10-K for the year ended June 30,
2000 and to all references to our firm included in this registration statement.
/s/ ARTHUR ANDERSEN LLP
Rochester, New York
August 16, 2001