Exhibit 4a
ELECTRIC FUEL CORPORATION
Private Placement of Electric Fuel Corporation Common Stock
STOCK PURCHASE AGREEMENT
September 30, 1996
Xx. Xxxx X. Xxxxx
c/o Enterprises, Inc.
River Park House
0000 Xxxxxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Dear Xxxx:
Electric Fuel Corporation, a Delaware corporation (the "Company"),
proposes to sell to you (the "Purchaser") in a private placement (the
"Offering") 1,538,462 shares of its common stock, $.01 par value per share (the
"Common Stock"). In connection with and in consideration for the sale and
purchase of the Common Stock, the Company and the Purchaser agree to abide by
the mutual covenants contained herein.
1. Sale and Purchase of the Common Stock. On the basis of the
representations, warranties and agreements contained in, and subject to the
terms and conditions of, this stock purchase agreement (the "Agreement"), the
Company agrees to sell to the Purchaser, and the Purchaser agrees to purchase
from the Company, 1,538,462 shares of its Common Stock at a price of $6.50 per
share.
2. Delivery and Payment. On the Closing Date, the Purchaser will pay to
the Company $10,000,003.00 (the "Purchase Price"). Delivery of the Common Stock
by the Company to the Purchaser shall be made in accordance with Purchaser's
written instructions to be provided at least two days prior to such delivery and
payment of the Purchase Price shall be made by wire transfer in immediately
available funds in U.S. dollars to the Company's
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account in accordance with the wire transfer instructions set forth on Annex I
hereto. The Closing of the Offering shall take place at the offices of Ropes &
Xxxx, Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxxx, XX 00000 on October 2, 1996, or at such
time on such other date as shall be agreed upon by the Company and the
Purchaser. The day on which the Closing takes place shall be referred to herein
as the "Closing Date."
3. Offering of Common Stock. The Common Stock will be offered and sold
to you without being registered under the Securities Act of 1933, as amended
(the "Securities Act"), in reliance on the exemption therefrom provided by
Section 4(2) of the Securities Act.
The Purchaser will have the registration rights set forth in the
registration rights agreement by and among the Company and the Purchaser dated
the Closing Date (the "Registration Rights Agreement"), in substantially the
form of Exhibit A hereto. At the Closing, the Company and the Purchaser will
enter into the Registration Rights Agreement. At the Closing, the Company will
also enter into a voting rights agreement by and among the Company, the
Purchaser, Xxxxxx X. Xxxxxxx and Xxxxxx Xxxxxx dated the Closing Date (the
"Voting Rights Agreement"), in substantially the form of Exhibit B hereto. This
Agreement, the Registration Rights Agreement and the Voting Rights Agreement are
hereinafter referred to collectively as the "Operative Documents."
4. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Purchaser as follows:
(a) 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's wholly-owned Israeli subsidiary, Electric
Fuel (E.F.L.) Limited ("EFL"), is duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation. Each of the Company and EFL is
qualified and in good standing as a foreign corporation in each
jurisdiction in which the character or location of its assets or
properties (owned, leased or licensed) or the nature of its business
makes such qualification necessary, except for such jurisdictions where
the failure to so qualify, individually or in the aggregate, would not
have a material adverse effect on the assets or properties, business,
results of operations or financial condition, taken as a whole, of the
Company and EFL.
(b) All necessary corporate and shareholder action has been
duly and validly taken to authorize the execution, delivery and
performance of the Operative Documents by the Company. This Agreement
has been duly and validly authorized, executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms,
except as the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally and by general equitable
principles. The Registration Rights Agreement and
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the Voting Rights Agreement have been duly and validly authorized, and
when executed and delivered, will constitute the legal, valid and
binding obligations of the Company enforceable against the Company in
accordance with its terms, except as the enforceability thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally
and by general equitable principles.
(c) Neither the execution, delivery and performance of the
Operative Documents by the Company nor the consummation of any of the
transactions contemplated hereby or thereby (including, without
limitation, the issuance and sale by the Company of the Common Stock)
will give rise to a right to terminate or accelerate the due date of
any payment due under, or conflict with or result in the breach of any
term or provision of, or constitute a default (or an event which with
notice or lapse of time or both would constitute a default) under, or
require any consent or waiver under, or result in the execution or
imposition of any material lien, charge or encumbrance upon any
properties or assets of the Company pursuant to the terms of, any
material indenture, mortgage, deed of trust or other agreement or
instrument to which the Company is a party or by which the Company or
any of its properties or businesses is bound, or any franchise,
license, permit, judgment, decree, order, statute, rule or regulation
applicable to the Company, or violate any provision of the charter or
by-laws of the Company or EFL, except for such consents or waivers that
have already been obtained and are in full force and effect, or require
any consent, approval, authorization or other order of or registration
or filing with, any court, regulatory body, administrative agency or
other governmental body, agency or official, or such consents or
waivers the failure to so obtain would not individually or in the
aggregate, have a material adverse effect upon the assets or
properties, business, results of operations or financial condition,
taken as a whole, of the Company and EFL.
(d) The entire authorized capital stock of the Company
consists of (i) 28,000,000 shares of Common Stock, of which 12,719,046
shares are issued and outstanding, and (ii) 1,000,000 shares of
preferred stock, $.01 par value per share (the "Preferred Stock"), of
which no shares are outstanding. No shares of Common Stock are held in
the Company's treasury. The shares of Common Stock outstanding have
been duly and validly issued, fully paid and nonassessable and have
been offered, issued and sold by the Company in compliance with
applicable state and federal securities laws. When issued and delivered
in accordance with the terms of this Agreement, the Common Stock to be
delivered to Purchaser hereunder will be duly authorized, validly
issued, fully paid and nonassessable. Except for the Company's 1991
Stock Option Plan, 1993 Stock Option and Restricted Stock Purchase Plan
and 1996 Amended and Restated Non-Employee Director Plan Stock Option
Plan, and options to purchase 7,286 shares of Common Stock issued to
consultants, there are no outstanding warrants, options or other rights
to purchase or acquire, or exchangeable for or convertible into, any
shares of Common Stock. Except as set forth in the
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Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1995 (the "1995 Form 10-K") and as provided in this Agreement, the
Voting Rights Agreement, or as set forth by applicable securities laws,
there are no restrictions on the transfer or voting of any shares of
the Company's Common Stock and no existing rights with respect to
registration under the Securities Act, of any of the Company's Common
Stock.
(e) The 1995 Form 10-K, the Company's Form 10-Q for the fiscal
period ended June 30, 1996 (the "1996 June Form 10-Q") and all
documents filed with the Securities and Exchange Commission (the
"Commission") pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act") (such documents, together with the 1995
Form 10-K, 1996 June Form 10-Q are hereinafter referred to as the
"Exchange Act Documents") were filed in a timely manner and, when they
were filed (or, if any amendment with respect to any such document was
filed, when such amendment was filed), conformed in all material
respects to the requirements of the Exchange Act, and the rules and
regulations thereunder, and did not contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
Subsequent to the respective dates as of which information was given in
the Exchange Act Documents, except as described therein, there has not
been any material adverse change, and, to the Company's knowledge, no
event has occurred which with notice or lapse of time or both, that
would constitute such a material adverse change, in the assets or
properties, business, results of operations or financial condition of
the Company taken as a whole.
(f) There are no claims for brokerage commissions or finder's
fees on similar compensation in connection with the transactions by
this Agreement based on any arrangement or agreement made by or on
behalf of the Company, and the Company agrees to indemnify and hold the
Purchaser harmless against any damages incurred as a result of any such
claims.
5. Representations and Warranties of the Purchaser. The Purchaser
represents and warrants to Company that:
(a) The Purchaser has full power and authority to execute,
deliver and perform each of this Agreement, the Registration Rights
Agreement and the Voting Rights Agreement. This Agreement constitutes a
valid and legally binding obligation of the Purchaser, enforceable
against the Purchaser in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles.
(b) The Common Stock to be received by the Purchaser will be
acquired for investment for the Purchaser's own account, and not with a
view to the distribution of
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any part thereof. The Purchaser has no present intention of selling,
granting any participation in, or otherwise distributing the same. The
Purchaser does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer, or grant participation
to such person or to any third person, with respect to any of the
Common Stock.
(c) The Purchaser understands that the Common Stock may not be
sold, transferred, or otherwise disposed of without registration under
the Securities Act, or an exemption therefrom, and that in the absence
of an effective registration statement covering the Common Stock or an
available exemption from registration under the Securities Act, the
Common Stock must be held indefinitely. In the absence of an effective
registration statement covering the Common Stock, the Purchaser will
sell, transfer, or otherwise dispose of the Common Stock only in a
manner consistent with its representations and agreements set forth
herein.
(d) The Purchaser understands that the certificates evidencing
the Common Stock may bear substantially the following legends:
(i) "THE COMMON STOCK EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER SECTION
5 OF THE SECURITIES ACT OF 1933 (THE
"SECURITIES ACT") AND APPLICABLE STATE
LAW, AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF
SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM (IN EACH CASE BASED
UPON DOCUMENTATION SATISFACTORY TO THE
COMPANY, INCLUDING AN OPINION OF
COUNSEL SATISFACTORY TO IT THAT
REGISTRATION UNDER THE SECURITIES ACT
AND ANY APPLICABLE STATE LAWS IS NOT
REQUIRED) OR PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT."
(ii) Any legend required by the Registration
Rights Agreement, the Voting Agreement or
any applicable law.
(e) The Purchaser is an "accredited investor" as such term is
defined in Rule 501(a)(1) promulgated pursuant to the Securities Act.
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(f) The Purchaser's financial condition is such that he is
able to bear the risk of holding the Common Stock for an indefinite
period of time.
(g) The Purchaser has such knowledge and experience in
financial and business matters and in making high risk investments of
this type that he is capable of evaluating the merits and risks of the
purchase of the Common Stock.
(h) The Purchaser has been furnished access to the business
records of the Company and such additional information and documents as
the Purchaser has requested and has been afforded an opportunity to ask
questions of and receive answers from representatives of the Company
concerning the business, operations, market potential, capitalization,
financial condition and prospects, and all other matters deemed
relevant by the Purchaser.
(i) There are no claims for brokerage commissions or finder's
fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or agreement
made by or on behalf of the Purchaser, and the Purchaser agrees to
indemnify and hold the Company harmless against any damages incurred as
a result of any such claims.
(j) The Purchaser acknowledges that the Company will rely upon
the truth and accuracy of the foregoing acknowledgments,
representations and agreements and agrees that, if any of the
acknowledgments, representations and agreements are no longer accurate,
he shall promptly notify the Company.
6. Conditions of the Purchaser's Obligations. The obligation of the
Purchaser to purchase the Common Stock is subject to each of the
following terms and conditions:
(a) The representations and warranties of the Company
contained in this Agreement shall be true and correct when made and on
and as of the Closing Date as if made on such date and the Company
shall have performed all covenants and agreements and satisfied all the
conditions contained in this Agreement required to be performed or
satisfied by it at or before the Closing Date.
(b) Receipt of an opinion by counsel to the Company in form
attached as Exhibit C hereto.
(c) The Company shall have executed and delivered the
Registration Rights Agreement and the Voting Rights Agreement and
delivered the Common Stock.
7. Conditions of the Company's Obligations. The obligation of the
Company to sell the Common Stock is subject to each of the following
terms and conditions:
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(a) The representations and warranties of the Purchaser
contained in this Agreement shall be true and correct when made and on
and as of the Closing Date as if made on such date and the Purchaser
shall have performed all covenants and agreements and satisfied all the
conditions contained in this Agreement required to be performed or
satisfied by it at or before the Closing Date.
(b) Receipt by the Company of the Purchase Price from the
Purchaser.
(c) The Purchaser shall have executed and delivered the
Registration Rights Agreement and the Voting Rights Agreement.
8. Covenant of the Company. The Company covenants and agrees as
follows:
The Company shall use its reasonable best efforts to do and perform all
things required or necessary to be done and performed under this Agreement by
the Company prior to the Closing Date, and to satisfy all conditions precedent
to the delivery of the Common Stock.
9. Covenants of the Purchaser. The Purchaser covenants and agrees as
follows:
(a) The Purchaser shall use his reasonable best efforts to do
and perform all things required or necessary to be done and performed
under this Agreement by the Purchaser prior to the Closing Date, and to
satisfy all conditions precedent to the delivery of the Common Stock.
(b) The Purchaser agrees that from the date hereof until the
fifth anniversary of the Closing Date, he will not, and will not permit
any of his Affiliates, as defined in the Securities Act, to directly or
indirectly or in conjunction with or through any Associate (as defined
in Rule 12b-2 of the Exchange Act), (i) solicit proxies with respect to
any capital stock or other voting securities of the Company under any
circumstances, or become a "participant" in any "election contest"
relating to the election of directors of the Company (as such terms are
used in Rule 14a-11 of Regulation 14A of the Exchange Act) or (ii) make
an offer for the acquisition of substantially all of the assets or
capital stock of the Company or induce or assist any other person to
make such an offer or (iii) form or join any "group" within the meaning
of Section 13(d)(3) of the Exchange Act with respect to any capital
stock or other voting securities of the Company for the purpose of
accomplishing the actions referred to in clauses (i) and (ii) above
other than pursuant to the Voting Rights Agreement.
10. Miscellaneous. This Agreement has been and is made for the benefit
of the Purchaser and the Company, and their respective successors and assigns,
and no other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" shall not include any purchaser of
Common Stock from the Purchaser merely because of such purchase.
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All notices and communications hereunder shall be in writing and mailed
or delivered or by telephone or telegraph if subsequently confirmed in writing,
(a) if to the Purchaser, Xxxx X. Xxxxx, c/o Enterprises, Inc., River Park House,
0000 Xxxxxxxxxxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000, with a copy to: Xxxxxxxx X.
Xxxxxx, Esq., Xxxxxxxx, Xxxxx & Xxxxxx, 0000 Xxxxxxxxxxx Xxxxxx, Xxxxxxxxxx,
X.X. 00000-0000; and (b) if to the Company, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxx
Xxxx, XX 00000, with a copy to Winthrop Minot, Esq., Ropes & Xxxx, Xxx
Xxxxxxxxxxxxx Xxxxx, Xxxxxx, XX 00000.
This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware, without regard to any conflicts or choice of
law principles which would cause the application of the internal laws of any
jurisdiction other than the State of Delaware.
This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
[THE REST OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
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Please confirm that the foregoing correctly sets forth the agreement
among us.
Very truly yours,
ELECTRIC FUEL CORPORATION
By___________________________
Title:
Agreed and accepted:
XXXX X. XXXXX
----------------------------
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Annex I
Wire Transfer Instructions
Details of the Electric Fuel Corporation account at Republic National Bank are
as follows:
Republic National Bank
000 Xxxxx Xxxxxx
Xxx Xxxx, XX
ABA # 021-004823
For credit to: Electric Fuel Corporation
Account #: 310303559
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