EXHIBIT 99.41
Registration Rights Agreement with ▇▇▇▇▇▇ ▇▇▇▇▇ dated as of October 20, 2003
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made by and
between Universal Automotive Industries, Inc., a Delaware corporation (the
"Company") and ▇▇▇▇▇▇ ▇▇▇▇▇ ("▇▇▇▇▇").
RECITALS
▇. ▇▇▇▇▇ desires to receive from the Company and the Company
desires to issue to ▇▇▇▇▇ 37,500 shares of the Company's common stock, par value
$.01 ("Common Stock"), in full satisfaction of the Company's obligation to him,
as set forth in that certain Stock Issuance Agreement between the Company and
▇▇▇▇▇ of even date herewith.
B. To induce ▇▇▇▇▇ to accept the Common Stock which the Company
desires to issue to him pursuant to the Stock Issuance Agreement, the Company
agrees to register such shares (the "Shares") under the Securities Act of 1933,
as amended, and the rules and regulations thereunder (collectively, the
"Securities Act").
NOW THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the parties hereto agree as follows:
1. Required Registrations.
(a) The Company will include the Registrable Securities
(as defined below) in a registration statement (the "Registration
Statement") which the Company will prepare and file with the United
States Securities and Exchange Commission (the "SEC") under the
Securities Act as soon as possible and use its best efforts to have
declared effective as soon as possible.
(b) Once the Registration Statement is declared effective
by the SEC, the Company shall prepare and file with the SEC such
amendments and supplements to such Registration Statement and the
prospectus used in connection therewith as may be necessary to keep the
Registration Statement effective until at least the earlier date to
occur (the "Release Date") of (i) the date that all of the Registrable
Securities have been sold pursuant to the Registration Statement and
(ii) the date that ▇▇▇▇▇ receives an opinion of counsel to the Company
that he may sell his Registrable Securities (without limitation or
restriction as to quantity or timing and without registration under the
Act) pursuant to Rule 144 of the Act or otherwise.
(c) It shall be a condition precedent to the obligations
of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities that ▇▇▇▇▇ shall furnish to the
Company such information regarding himself, the Registrable Securities
held by him, and the intended method of disposition of such securities
as shall be required to effect the registration of his Registrable
Securities.
2. Restrictions on Transfer. ▇▇▇▇▇ shall not sell or offer to
sell any Registrable Securities until after the earlier to occur of the
Registration Statement having been declared effective or the date that ▇▇▇▇▇
receives an opinion of counsel to the Company that he may sell
his Registrable Securities (without limitation or restriction as to quantity or
timing and without registration under the Securities Act) pursuant to Rule 144
of the Securities Act or otherwise.
3. Registration Procedures. In connection with any registration
of Registrable Securities, the Company shall:
(a) prepare and file with the Securities and Exchange
Commission a registration statement on the appropriate form under the
Securities Act, which form shall be available for the sale of such
Registrable Securities in accordance with the intended method or
methods of distribution thereof, and use its commercially reasonable
efforts to cause such registration statement to become effective;
(b) notify ▇▇▇▇▇ of the effectiveness of the registration
statement filed hereunder and prepare and file with the Securities and
Exchange Commission such amendments, post-effective amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary or appropriate to keep such
registration statement effective for the period required for sale of
the Registrable Securities and cause such prospectus as so supplemented
to be filed as required under the Securities Act, and comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement during such period in
accordance with the intended methods of disposition by ▇▇▇▇▇ set forth
in such registration statement or supplement to the prospectus;
(c) furnish ▇▇▇▇▇ such number of copies of such
registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as ▇▇▇▇▇ may
reasonably request in order to facilitate the disposition of the
Registrable Securities owned by ▇▇▇▇▇;
(d) use its best efforts to register or qualify such
Registrable Securities under such other securities or blue sky laws of
such jurisdictions where such registration or qualification is required
as he reasonably request and do any and all other acts and things which
may be reasonably necessary or advisable to enable him to consummate
the disposition in such jurisdictions of the Registrable Securities
owned by him (provided that the Company shall not be required to: (i)
qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subparagraph (d); (ii)
subject itself to taxation in any such jurisdiction; or (iii) consent
to general service of process in any such jurisdiction);
(e) notify ▇▇▇▇▇, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, upon
discovery that, or upon the happening of any event as a result of which
the prospectus included in such registration statement as then in
effect, contains an untrue statement of a material fact or omits any
fact necessary to make the statements therein not misleading in the
light of the circumstances under which they were made, and, at the
request of ▇▇▇▇▇, the Company shall prepare a supplement or amendment
to such prospectus so that, thereafter delivered to the purchasers of
such Registrable Securities, such prospectus shall not contain an
untrue statement of a material
fact required to be stated therein or omit to state any fact necessary
to make the statements therein not misleading;
(f) cooperate with ▇▇▇▇▇ and the managing underwriters,
if any, to: (i) facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold and not
bearing any restrictive legends; (ii) enable such Registrable
Securities to be in such denominations and registered in such names as
▇▇▇▇▇ or managing underwriters, if any, may request at least ten (10)
business days prior to any sale of Registrable Securities; and (iii)
provide a transfer agent and registrar for all such Registrable
Securities not later than the effective date of such registration
statement;
(g) enter into such agreements as are customary with
regard to registrations of the type being conducted with respect to the
Registrable Securities (including, if there is an underwriter,
underwriting agreements in customary form);
(h) make available for inspection by ▇▇▇▇▇, any
underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other agent
retained by any such seller or underwriter, all financial and other
records, pertinent corporate documents and properties of the Company
that is customary, and cause the Company's officers, directors,
employees and independent accountants to supply all information
reasonably requested by any such seller, underwriter, attorney,
accountant or agent in connection with such registration statement,
provided, however, that the Company's obligation pursuant to this
Section 3(h) shall be conditioned upon such underwriter's, attorney's,
accountant's or other agent's signing a standard confidentiality
agreement in a form reasonably satisfactory to the Company;
(i) cooperate, and cause the Company's officers,
directors, employees and independent accountants to cooperate, with
▇▇▇▇▇ and the designated underwriter, if any, in the sale of the
Registrable Securities and take any actions necessary to promote,
facilitate or effectuate such sale;
(j) otherwise use its best efforts to comply with all
applicable rules and regulations of the Securities and Exchange
Commission;
(k) in the event of the issuance of any stop order
suspending the effectiveness of a registration statement, or of any
order suspending or preventing the use of any related prospectus or
suspending the qualification of any common stock included in such
registration statement for sale in any jurisdiction, use its best
efforts promptly to obtain the withdrawal of such order.
4. Sales Pursuant to Rule 144. With a view to making available to
▇▇▇▇▇ the benefits of Rule 144 promulgated under the Securities Act and any
other rule or regulation of the SEC that may at any time permit him to sell
securities of the Company to the public without registration, the Company agrees
to use its best efforts to:
(a) make and keep public information available, as those
terms are understood and defined in SEC Rule 144;
(b) file with the SEC in a timely manner all reports and
other documents required of the Company under the Securities Act and
the Securities Exchange Act of 1934; and
(c) take further action as ▇▇▇▇▇ may reasonably request,
to the extent required to enable ▇▇▇▇▇ to sell Registrable Securities
pursuant to Rule 144 adopted by the SEC under the Securities Act (as
such rules may be amended from time to time) or any similar rules or
regulations hereafter adopted by the SEC.
5. Registration Expenses.
(a) All expenses incident to the Company's performance of
or compliance with this Agreement, including without limitation: (i)
all registration and filing fees (including, if applicable, the fees
and expenses of any "qualified independent underwriter" and its counsel
as may be required under the rules and regulations of the NASD); (ii)
fees and expenses of compliance with securities or blue sky laws
(including fees and disbursements of counsel for the underwriters or
selling holders in connection with blue sky qualifications and
determination of their eligibility for investment under applicable
laws); (iii) printing expenses; (iv) messenger, telephone and delivery
expenses; (v) fees and disbursements of custodians, counsel for the
Company and all independent certified public accountants (including the
expenses of any special audit and "cold comfort" letters required by or
incident to such performance), underwriters (excluding underwriters'
discounts and commissions) and other Persons retained by the Company;
(vi) the Company's internal expenses (including, without limitation,
all salaries and expenses of its officers and employees performing
legal or accounting duties); (vii) the expense of any annual audit or
quarterly review; (viii) the expense of any liability insurance if such
insurance coverage is obtained by the Company; and (ix) the expenses
and fees for listing the securities to be registered on each securities
exchange on which similar securities issued by the Company are then
listed or on the Nasdaq shall be borne by the Company.
(b) Except as provided in Section 5(a), ▇▇▇▇▇ shall pay
the discounts and commissions allocable to him and the fees and
expenses of his counsel.
6. Indemnification and Contribution.
(a) The Company agrees to indemnify ▇▇▇▇▇ against all
losses, claims, damages, liabilities and expenses caused by any untrue
or alleged untrue statement of material fact contained in any
registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or any omission or alleged
omission of a material fact required to be stated therein or necessary
to make the statements therein not misleading, except insofar as the
same are caused by or contained in any information furnished in writing
to the Company by ▇▇▇▇▇ expressly for use therein or by his failure to
deliver a copy of the registration statement or prospectus or any
amendments or supplements thereto after the Company has furnished ▇▇▇▇▇
with a sufficient number of copies of the same. In connection with an
underwritten offering, the Company shall indemnify such underwriters,
their officers and directors and each Person
who controls such underwriters (within the meaning of the Securities
Act) to the same extent as provided above with respect to the
indemnification of ▇▇▇▇▇.
(b) In connection with any registration statement in
which ▇▇▇▇▇ is participating, he shall furnish to the Company in
writing such information and affidavits as the Company and any
underwriter reasonably requests for use in connection with any such
registration statement or prospectus and shall indemnify the Company,
its directors and officers and each Person who controls the Company
(within the meaning of the Securities Act) against any losses, claims,
damages, liabilities and expenses resulting from any untrue or alleged
untrue statement of material fact contained in the registration
statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto or any omission or alleged omission of a
material fact required to be stated therein or necessary to make the
statements therein not misleading, but only to the extent that such
untrue statement or omission is contained in any information or
affidavit so furnished in writing by him.
(c) Any Person entitled to indemnification hereunder
shall (i) give prompt written notice to the indemnifying party of any
claim with respect to which he, she or it seeks indemnification
(provided that the failure to give prompt notice shall not impair any
Person's right to indemnification hereunder to the extent such failure
has not materially prejudiced the indemnifying party) and (ii) unless
in such indemnified party's reasonable judgment a conflict of interest
between such indemnified and indemnifying parties may exist with
respect to such claim, permit such indemnifying party to assume the
defense of such claim with counsel reasonably satisfactory to the
indemnified party. If such defense is assumed, the indemnifying party
shall not be subject to any liability for any settlement made by the
indemnified party without its consent (but such consent shall not be
unreasonably withheld). An indemnifying party who is not entitled to,
or elects not to, assume the defense of a claim shall not be obligated
to pay the fees and expenses of more than one counsel for all parties
indemnified by such indemnifying party with respect to such claim,
unless in the reasonable judgment of any indemnified party a conflict
of interest may exist between such indemnified party and any other of
such indemnified parties with respect to such claim.
(d) If the indemnification provided for in this Section 6
is unavailable to an indemnified party under paragraphs (a) or (b)
hereof in respect to any losses, claims, damages, liabilities or
expenses referred to therein, then an indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities or expenses in such proportion as is
appropriate to reflect the relative fault of the Company and ▇▇▇▇▇ in
connection with the statements or omissions that resulted in such
losses, claim, damages, liabilities or expenses. The relative fault of
the Company and ▇▇▇▇▇ in connection with the statements that resulted
in such losses, claims, liabilities or expenses shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of material facts or the omission or alleged omission to
state a material fact relates to information supplied by the Company or
▇▇▇▇▇ and the parties relative intent, knowledge, access to information
and opportunity to correct such statement or omission.
(e) Notwithstanding any other provision of this Section,
the liability of ▇▇▇▇▇ for indemnification or contribution under this
Section shall not exceed an amount equal to the number of shares sold
by him multiplied by the net amount per share which he receives from
the sale of such shares.
(f) The indemnification and contribution provided for
under this Agreement shall remain in full force and effect regardless
of any investigation made by or on behalf of the indemnified party or
any officer, director or controlling Person of such indemnified party
and shall survive the transfer of securities.
7. Definitions.
"NASD" means the National Association of Securities Dealers, Inc.
"Person" means any individual, corporation, partnership, limited
liability company, trust, estate, association, cooperative, government or
governmental entity (or any branch, subdivision or agency thereof) or any other
entity.
"Registrable Securities" means: (i) the Shares; and (ii) any Common
Stock issued as (or issuable upon the conversion or exercise of any warrant,
right or other security which is issued as) a dividend or other distribution
with respect to, or in exchange for or in replacement of, the Shares. As to any
particular Registrable Securities, such securities shall cease to be Registrable
Securities when they have been distributed to the public pursuant to an offering
registered under the Securities Act, or are eligible to be sold to the public
through a broker, dealer or market maker in compliance with Rule 144 under the
Securities Act (or any such rule then in force). For purposes of this Agreement,
a Person shall be deemed to be a holder of Registrable Securities whenever such
Person has the right to acquire directly or indirectly such Registrable
Securities, whether or not such acquisition has actually been effected.
8. Miscellaneous.
(a) No Inconsistent Agreements. The Company shall not
hereafter enter into any agreement with respect to its securities which
is inconsistent with or violates the rights granted to ▇▇▇▇▇ in this
Agreement.
(b) Amendments and Waivers. Except as otherwise provided
herein, the provisions of this Agreement may be amended or waived only
upon the prior written consent of the Company and ▇▇▇▇▇.
(c) Successors and Assigns. All covenants and agreements
in this Agreement by or on behalf of any of the parties hereto shall
bind and inure to the benefit of the respective successors and assigns
of the parties hereto whether so expressed or not. In addition, whether
or not any express assignment has been made, the provisions of this
Agreement which are for the benefit of the purchasers or holders of
Registrable Securities are also for the benefit of, and enforceable by,
any subsequent holder of Registrable Securities. A person is deemed to
be a holder of Registrable Securities whenever such person is the
registered holder of Registrable Securities. Upon the transfer of any
Registrable Securities, the transferring holder of Registrable
Securities shall cause the transferee to execute and deliver to the
Company a counterpart of this Agreement.
(d) Severability. Whenever possible, each provision of
this Agreement shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this Agreement
is held to be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition
or invalidity, without invalidating the remainder of this Agreement.
(e) Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, whether by original,
photocopy or facsimile, and any one of which need not contain the
signatures of more than one party, but all such counterparts taken
together shall constitute one and the same Agreement.
(f) Descriptive Heading. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a
part of this Agreement.
(g) Consent to Jurisdiction: Service of Process. The
Company and ▇▇▇▇▇ hereby irrevocably consent to the jurisdiction of the
courts of the State of Illinois and any and all actions and proceedings
in connection with this Agreement, and irrevocably consent, in addition
to any methods of service of process permissible under applicable law,
to service of process by certified mail, return receipt requested to
the address of Company and ▇▇▇▇▇. Nothing in this Section shall affect
or limit the right of any ▇▇▇▇▇ to serve legal process in any other
manner permitted by law. The Company and ▇▇▇▇▇ agree that in any action
or proceeding brought by them in connection with this Agreement or the
transactions contemplated hereby, exclusive jurisdiction shall be in
the courts of the State of Illinois.
IN WITNESS WHEREOF, the undersigned has executed this Registration
Rights Agreement this 20th day of October, 2003.
UNIVERSAL AUTOMOTIVE INDUSTRIES, INC.
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By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
Its: President ▇▇▇▇▇▇ ▇▇▇▇▇
