Wisconsin
|
39-1987014
|
(State or other jurisdiction of
|
(I.R.S. Employer Identification No.)
|
incorporation or organization)
|
Large accelerated filer
o
|
Accelerated filer
o
|
Non-accelerated filer
o
|
Smaller reporting company
þ
|
Class
|
Shares Outstanding as of February 9, 2012
|
Common Stock, $.01 par value per share
|
41,055,079
|
PART I. FINANCIAL INFORMATION (*)
|
Page
|
||
Item 1
.
|
Condensed Consolidated Financial Statements
|
1
|
|
Condensed Consolidated Balance Sheets (unaudited), December 31, 2011 and June 30, 2011
|
1
|
||
Condensed Consolidated Statements of Operations (unaudited), Three and Six Months Ended December 31, 2011 and 2010
|
2
|
||
Condensed Consolidated Statements of Changes in Equity (unaudited), Six Months Ended December 31, 2011 and year ended June 30, 2011
|
3
|
||
Condensed Consolidated Statements of Cash Flows (unaudited), Six Months Ended December 31, 2011 and 2010
|
4
|
||
Notes to Condensed Consolidated Financial Statements (unaudited)
|
5
|
||
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
27
|
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
36
|
|
Item 4.
|
Controls and Procedures
|
36
|
|
PART II. OTHER INFORMATION
|
|||
Item 1.
|
Legal Proceedings
|
36
|
|
Item 1A.
|
Risk Factors
|
36
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
37
|
|
Item 3.
|
Defaults upon Senior Securities
|
37
|
|
Item 4.
|
Mine Safety Disclosures
|
37
|
|
Item 5.
|
Other Information
|
37
|
|
Item 6.
|
Exhibits
|
37
|
|
Signatures
|
38
|
●
|
Raw materials – purchased cost of direct material
|
●
|
Finished goods and work-in-progress – purchased cost of direct material plus direct labor plus a proportion of manufacturing overheads.
|
|
Estimated Useful Lives
|
|
Manufacturing equipment
|
3 - 7 years
|
|
Office equipment
|
3 - 7 years
|
|
Building and improvements
|
7 - 40 years
|
Six Months and Year Ended
|
||||||||
December 31, 2011
|
June 30, 2011
|
|||||||
Beginning balance
|
$ | 413,203 | $ | 520,000 | ||||
Accruals for warranties during the period
|
- | 176,662 | ||||||
Settlements during the perioid
|
(50,400 | ) | (283,459 | ) | ||||
Adjustments relating to preexisting warranties
|
(240,000 | ) | - | |||||
Ending balance
|
$ | 122,803 | $ | 413,203 |
Three months ended December 31,
|
Six months ended December 31,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Net loss
|
$ | (2,767,540 | ) | $ | (1,838,274 | ) | $ | (4,442,988 | ) | $ | (3,872,575 | ) | ||||
Net translation adjustment
|
10,297 | (4,229 | ) | (12,209 | ) | (23,668 | ) | |||||||||
Comprehensive loss
|
$ | (2,757,243 | ) | $ | (1,842,503 | ) | $ | (4,455,197 | ) | $ | (3,896,243 | ) |
●
|
the timing of revenue recognition;
|
●
|
the allowance for doubtful accounts;
|
●
|
provisions for excess and obsolete inventory;
|
●
|
the lives and recoverability of property, plant and equipment and other long-lived assets, including goodwill and other intangible assets;
|
●
|
contract costs and reserves;
|
●
|
warranty obligations;
|
●
|
income tax valuation allowances;
|
●
|
stock-based compensation; and
|
●
|
fair values of assets acquired and liabilities assumed in a business combination.
|
Total purchase price
|
$ | 2,515,071 | ||
Less debt and equity issued to Seller:
|
||||
Note payable
|
(1,350,000 | ) | ||
Common stock
|
(920,000 | ) | ||
Total debt and equity issued to Seller
|
(2,270,000 | ) | ||
Total cash paid
|
245,071 | |||
Less cash acquired
|
(19,149 | ) | ||
Acquisition of business, net of cash acquired
|
$ | 225,922 |
Cash and cash equivalents
|
$ | 19,149 | ||
Accounts receivable
|
225,081 | |||
Inventories
|
772,932 | |||
Property and equipment
|
4,500 | |||
Other intangible assets
|
2,198,097 | |||
Accounts payable
|
(141,003 | ) | ||
Accrued expenses
|
(203,823 | ) | ||
Deferred revenue
|
(359,862 | ) | ||
Net assets acquired
|
$ | 2,515,071 |
Unaudited
|
Unaudited
|
|||||||||||||||
Three months ended December 31,
|
Six Months Ended December 31,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Revenues
|
$ | 440,921 | $ | 234,681 | $ | 2,078,778 | $ | 794,576 | ||||||||
Loss from Operations
|
(2,765,336 | ) | (1,871,595 | ) | (4,461,818 | ) | (4,011,697 | ) | ||||||||
Net loss
|
$ | (2,730,310 | ) | $ | (1,945,464 | ) | $ | (4,405,758 | ) | (4,144,573 | ) | |||||
Net Loss per share-
|
||||||||||||||||
Basic and diluted
|
$ | (0.08 | ) | $ | (0.09 | ) | $ | (0.14 | ) | $ | (0.22 | ) | ||||
Weighted average shares-basic and diluted:
|
||||||||||||||||
Basic
|
33,681,776 | 20,996,322 | 32,089,356 | 18,603,353 | ||||||||||||
Diluted
|
33,681,776 | 20,996,322 | 32,089,356 | 18,603,353 |
December 31, 2011
|
June 30, 2011
|
|||||||
Raw materials
|
$ | 1,737,214 | $ | 1,146,720 | ||||
Work in progress
|
1,000,269 | 439,130 | ||||||
Total
|
$ | 2,737,483 | $ | 1,585,850 |
December 31, 2011
|
June 30, 2011
|
|||||||
Land
|
$ | 217,000 | $ | 217,000 | ||||
Building and improvements
|
3,334,131 | 2,559,266 | ||||||
Manufacturing equipment
|
4,336,065 | 2,901,912 | ||||||
Office equipment
|
302,499 | 217,074 | ||||||
Construction in process
|
150,623 | 1,215,400 | ||||||
Total, at cost
|
8,340,318 | 7,110,652 | ||||||
Less, accumulated depreciation
|
(2,614,907 | ) | (2,343,781 | ) | ||||
Property, Plant & Equipment, Net
|
$ | 5,725,411 | $ | 4,766,871 |
December 31, 2011
|
June 30, 2011
|
|||||||
Bank loans and notes payable-current
|
$ | 909,560 | $ | 779,088 | ||||
Bank loans and notes payable-long term
|
3,654,717 | 3,937,056 | ||||||
Total
|
$ | 4,564,277 | $ | 4,716,144 |
2012
|
$ | 626,570 | ||
2013
|
1,021,838 | |||
2014
|
815,883 | |||
2015
|
346,466 | |||
2016
|
356,327 | |||
2017 and thereafter
|
1,397,193 | |||
$ | 4,564,277 |
Number of Options
|
Weighted-Average Exercise Price Per Share
|
|||||||
Balance at July 1, 2010
|
2,316,992 | $ | 1.92 | |||||
Options granted
|
1,230,500 | 1.02 | ||||||
Options forfeited
|
(150,189 | ) | 2.51 | |||||
Options exercised
|
(75,000 | ) | 1.09 | |||||
Balance at June 30, 2011
|
3,322,303 | 1.55 | ||||||
Options granted
|
1,154,500 | 0.84 | ||||||
Options forfeited
|
(332,500 | ) | 1.08 | |||||
Balance at December 31, 2011
|
4,144,303 | $ | 1.39 |
Outstanding
|
Exercisable
|
|||||
Range of Exercise Prices
|
Number of
Options
|
Average
Remaining
Contractual Life
(in years)
|
Weighted Average
Exercise Price
|
Number of
Options
|
Weighted
Average
Exercise Price
|
|
$0.46 to $1.69
|
3,619,303
|
6.8
|
$ 1.06
|
1,131,748
|
$ 1.22
|
|
$3.59 to $3.82
|
525,000
|
3.1
|
$ 3.61
|
525,000
|
$ 3.61
|
|
Balance at December 31, 2011
|
4,144,303
|
6.4
|
$ 1.39
|
1,656,748
|
$ 1.98
|
2012
|
2011
|
|||||||
Expected life of option (years)
|
2.5 | 2.5 | ||||||
Risk-free interest rate
|
.24 - .55% | .52-.685% | ||||||
Assumed volatility
|
104 - 107% | 62-114% | ||||||
Expected dividend rate
|
0 | 0 | ||||||
Expected forfeiture rate
|
5.3 - 6.8% | 0 |
Number of
Options
|
Weighted-Average Grant Date Fair Value Per
Share
|
|||||||
Balance at July 1, 2010
|
987,500 | $ | 0.77 | |||||
Granted
|
1,230,500 | 0.58 | ||||||
Vested
|
(476,526 | ) | 0.49 | |||||
Forfeited
|
(6,250 | ) | 0.29 | |||||
Balance at June 30, 2011
|
1,735,224 | 0.62 | ||||||
Granted
|
1,154,500 | 0.84 | ||||||
Vested
|
(194,669 | ) | 1.06 | |||||
Forfeited
|
(332,500 | ) | 1.08 | |||||
Balance at December 31, 2011
|
2,362,555 | $ | 0.99 |
Number of Restricted Stock Units
|
Weighted-Average Valuation Price Per Unit
|
|||||||
Conversion of cash settled RSUs
|
574,242 | $ | 0.55 | |||||
RSUs granted
|
826,143 | 0.80 | ||||||
RSUs forfeited
|
- | - | ||||||
Balance at June 30, 2011
|
1,400,385 | 0.70 | ||||||
RSUs granted
|
548,051 | 0.77 | ||||||
RSUs forfeited
|
- | - | ||||||
Balance at December 31, 2011
|
1,948,436 | $ | 0.72 |
Number of Warrants
|
Weighted-Average Exercise Price Per Share
|
|||||||
Balance at July 1, 2010
|
1,846,031 | $ | 1.76 | |||||
Warrants granted
|
3,067,797 | 1.24 | ||||||
Warrants expired
|
- | - | ||||||
Warrants exercised
|
(3,027,797 | ) | (1.25 | ) | ||||
Balance at June 30, 2011
|
1,886,031 | 1.73 | ||||||
Warrants granted (See Note 12)
|
4,132,553 | 0.53 | ||||||
Warrants expired
|
(266,873 | ) | (3.56 | ) | ||||
Warrants exercised (See Note 12)
|
(4,132,553 | ) | (0.55 | ) | ||||
Balance at December 31, 2011
|
1,619,158 | $ | 1.47 |
2012
|
$ | 91,642 | ||
2013
|
183,285 | |||
2014
|
141,285 | |||
2015
|
99,285 | |||
$ | 515,497 |
Six months ended December 31,
|
||||||||
2011
|
2010
|
|||||||
Current
|
$ | (181,800 | ) | $ | - | |||
Deferred
|
- | - | ||||||
Provision (benefit) for income taxes
|
$ | (181,800 | ) | $ | - |
Six months ended December 31,
|
||||||||
2011
|
2010
|
|||||||
Income tax benefit computed at the U.S. federal statutory rate
|
-34% | -34% | ||||||
Australia research and development credit
|
-4 | 0 | ||||||
Change in valuation allowance
|
34 | 34 | ||||||
Total
|
-4% | 0% |
December 31, 2011
|
June 30, 2011
|
|||||||
Federal net operating loss carryforwards
|
14,920,208 | $ | 13,481,428 | |||||
Federal - other
|
3,128 | 221,795 | ||||||
Wisconsin net operating loss carryforwards
|
1,762,387 | 1,544,877 | ||||||
Australia net operating loss carryforwards
|
1,485,393 | 1,560,010 | ||||||
Deferred income tax asset valuation allowance
|
(17,989,775 | ) | (16,808,110 | ) | ||||
Total deferred income tax assets
|
$ | - | $ | - |
Six Months Ended December 31, 2011
|
Year Ended June 30, 2011
|
|||||||
Beginning balance
|
$ | 219,500 | $ | - | ||||
Additions based on tax positions related to the current period
|
- | 219,500 | ||||||
Additions for tax positions of prior years
|
- | - | ||||||
Reductions for tax positions of prior years
|
- | - | ||||||
Settlements
|
- | - | ||||||
Lapses of statutes of limitations
|
- | - | ||||||
Effect of foreign currency translation
|
(10,480 | ) | ||||||
Ending balance
|
$ | 209,020 | $ | 219,500 |
Three months ended December 31,
|
Six months ended December 31,
|
|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Revenues
:
|
||||||||||||||||
ZBB Energy Storage and Power Electronics Systems
|
$ | 277,618 | $ | 234,681 | $ | 1,689,368 | $ | 234,681 | ||||||||
Tier Electronics Power Conversion Systems
|
163,303 | - | 389,410 | - | ||||||||||||
Total
|
$ | 440,921 | $ | 234,681 | $ | 2,078,778 | $ | 234,681 | ||||||||
Three months ended December 31,
|
Six months ended December 31,
|
|||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Loss from Operations:
|
||||||||||||||||
ZBB Energy Storage and Power Electronics Systems
|
$ | (2,281,768 | ) | $ | (1,794,398 | ) | $ | (3,558,222 | ) | $ | (3,798,482 | ) | ||||
Tier Electronics Power Conversion Systems
|
(483,568 | ) | - | $ | (903,596 | ) | - | |||||||||
Total
|
$ | (2,765,336 | ) | $ | (1,794,398 | ) | $ | (4,461,818 | ) | $ | (3,798,482 | ) |
December 31, 2011
|
June 30, 2011
|
|||||||
ZBB Energy Storage and Power Electronics Systems
|
$ | 11,510,497 | $ | 10,161,151 | ||||
Tier Electronics Power Conversion Systems
|
3,148,941 | 2,186,475 | ||||||
Total
|
$ | 14,659,438 | $ | 12,347,626 |
Item 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
●
|
Our stock price could be volatile and our trading volume may fluctuate substantially.
|
●
|
We have incurred losses and anticipate incurring continuing losses.
|
●
|
We will need additional financing.
|
●
|
Our industry is highly competitive and we may be unable to successfully compete.
|
●
|
Successful commercialization of our next generation ZBB Enerstore™, Zinc Bromide flow battery, version three (V3) and receipt of UL 1741 certification for the ZBB Enersection™ POWR PECC are critical component of our growth plans.
|
●
|
If our products do not perform as promised, we could experience increased costs, lower margins and harm to our reputation.
|
●
|
Our relationships with our strategic partners may not be successful and we may not be successful in establishing additional partnerships, which could adversely affect our ability to commercialize our products and services.
|
●
|
Shortages or delay of supplies of component parts may adversely affect our operating results until alternate sources can be developed.
|
●
|
We have no experience manufacturing our products on a large-scale basis and may be unable to do so at our manufacturing facilities.
|
●
|
We may experience difficulties in integrating the business of Tier Electronics LLC and could fail to realize the potential benefits of the acquisition.
|
●
|
Our China joint venture could be adversely affected by the laws and regulations of the Chinese government, our lack of decision-making authority and disputes between us and the Joint Venture.
|
●
|
Business practices in Asia may entail greater risk and dependence upon the personal relationships of senior management than is common in North America, and therefore some of our agreements with other parties in China and South Korea could be difficult or impossible to enforce.
|
●
|
Our success depends on our ability to retain our managerial personnel and to attract additional personnel.
|
●
|
We market and sell, and plan to market and sell, our products in numerous international markets. If we are unable to manage our international operations effectively, our business, financial condition and results of operations could be adversely affected.
|
●
|
Our financial results may vary significantly from period-to-period due to long and unpredictable sales cycles for some of our products and the cyclical nature of certain end-markets into which we sell our products, which may in turn lead to volatility in our stock price.
|
●
|
Businesses and consumers might not adopt alternative energy solutions as a means for obtaining their electricity and power needs, and therefore our revenues may not increase, and we may be unable to achieve and then sustain profitability.
|
●
|
The success of our business depends on our ability to develop and protect our intellectual property rights, which could be expensive.
|
●
|
We may be subject to claims that we infringe the intellectual property rights of others, and unfavorable outcomes could harm our business.
|
●
|
If our shareholders’ equity continues to remain below the minimum requirement, our common stock may be delisted from the NYSE Amex, which would cause our common stock to become less liquid.
|
●
|
We have never paid cash dividends and do not intend to do so.
|
●
|
Raw materials – purchased cost of direct material
|
●
|
Finished goods and work-in-progress – purchased cost of direct material plus direct labor plus a proportion of manufacturing overheads.
|
|
Estimated Useful Lives
|
|
Manufacturing equipment
|
3 - 7 years
|
|
Office equipment
|
3 - 7 years
|
|
Building and improvements
|
7 - 40 years
|
●
|
the timing of revenue recognition;
|
●
|
the allowance for doubtful accounts;
|
●
|
provisions for excess and obsolete inventory;
|
●
|
the lives and recoverability of property, plant and equipment and other long-lived assets such as goodwill and other intangible assets;
|
●
|
contract costs and reserves;
|
●
|
warranty obligations;
|
●
|
income tax valuation allowances;
|
●
|
stock-based compensation; and
|
●
|
fair values of assets acquired and liabilities assumed in a business combination.
|
●
|
$187,620 of costs of product sales during the fiscal 2012 period compared to $79,058 of costs of products sales during the fiscal 2011 period;
|
●
|
Increase in advanced engineering and development expenses of approximately $599,770 due to an increase in the Company’s engineering and development activities for its next generation battery module and PECC systems;
|
●
|
Increase in selling, general, and administrative expenses of $143,429 due primarily to the inclusion of $257,407 related to Tier Electronics in the fiscal 2012 period partially offset by decreases in various expenses;
|
●
|
Increase in depreciation and amortization expenses of $325,417 primarily due to the amortization of intangible assets related to the Tier acquisition beginning in January 2011.
|
●
|
$344,291 of costs of product sales during the fiscal 2012 period compared to $79,058 of costs of products sales during the fiscal 2011 period;
|
●
|
$481,107 of costs of engineering and development revenues during the fiscal 2012 period compared to $0 of costs of engineering and development revenues during the fiscal 2011 period;
|
●
|
Increase in advanced engineering and development expenses of approximately $460,000 due to an increase in the Company’s engineering and development activities for its next generation Enerstore battery module and Enersection PECC systems;
|
●
|
Increase in selling, general, and administrative expenses of $742,698 due primarily to the inclusion of $537,203 related to Tier Electronics in the fiscal 2012 period, and an increase in stock based compensation of $323,000 partially offset by decreases in other expenses;
|
●
|
Increase in depreciation and amortization expenses of $558,515 primarily due to the amortization of intangible assets related to the Tier acquisition beginning in January 2011.
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
ZBB ENERGY CORPORATION
|
||
February 9, 2012
|
By:
|
/s/Eric C. Apfelbach
|
Name:
|
Eric C. Apfelbach
|
|
Title:
|
Chief Executive Officer
|
|
(Principal Executive Officer)
|
||
February 9, 2012
|
By:
|
/s/ Will Hogoboom
|
Name:
|
Will Hogoboom
|
|
Title:
|
Chief Financial Officer
|
|
(Principal financial officer and
|
||
Principal accounting officer)
|
Exhibit
No.
|
Description
|
Incorporated by Reference to
|
Anhui Meineng Store Energy Co., Ltd. Supplemental Agreement to the Joint Venture Agreement by and between ZBB PowerSav Holdings Limited and Anhui Xinlong Investment Management Co., Ltd, dated November 15, 2011
|
||
License Agreement by and between ZBB PowerSav Holdings Ltd. and Anhui Meineng Store Energy Co., Ltd., dated November 11, 2011
|
||
10.3 | Management Services Agreement by and between ZBB Powersav Holdings Ltd. and Anhui Meineng Store Energy Co., Ltd., dated November 11, 2011. | |
Offer letter between ZBB Energy Corporation and Charles Stankiewicz dated November 3, 2011
|
||
Form of Nonstatutory Option Agreements issued on November 9, 2011 to Charles Stankiewicz
|
||
10.6
|
Form of Stock Purchase Agreement, dated December 13, 2011
|
Current Report on Form 8-K filed on December 15, 2011
|
10.7
|
Form of Stock Purchase Agreement, dated December 14, 2011
|
Current Report on Form 8-K filed on December 15, 2011
|
10.8
|
Placement Agency Agreement between ZBB Energy Corporation and MDB Capital Group, LLC, dated December 14, 2011
|
Current Report on Form 8-K filed on December 15, 2011
|
Form of Registration Rights Agreement, dated December 13, 2011
|
||
Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
||
Certification of Principal Financial and Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
||
Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
||
Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
||
101
|
Interactive Data Files
|
1.
|
修订合资公司名称
|
2.
|
修订注册资本与投资总额
|
|
Amendment to the Registered Capital and Total Investment
|
4.1
注册资本:合资公司初始注册资本为
8720
万人民币(下称:注册资本),具体出资信息详见附件
A
。但是如果:(
i
)双方初始出资资产于评估之时,相关中国当局认定,依适用法律之规定,该等资产不值附件
A
所述之价值,且(
ii
)届时,该等投资方在收到上述(
i
)所述认定通知
10
个工作日内,未能按附件
A
所载金额追加出资到位;那么,本协议自动终止,且无需双方采取任何进一步行动,并且,对合资公司的此前出资应将立即退还原来的相关出资方。
|
4.1
Registered Capital
. The initial registered capital of the Company shall be Eighty Seven Million Two Hundred Thousand Renminbi (RMB 87,200,000) (“
Registered Capital
”), which will be contributed by the Parties in the amounts, and forms, as set forth on
Exhibit A
;
provided
,
however
, that if (i) upon an assessment of the initial assets to be contributed by the Parties hereunder, the relevant People’s Republic of China Governmental Authority determines under Applicable Law that certain assets do not warrant the valuations set forth on
Exhibit A
and (ii) whereupon, unless the JV Investors contribute such amount of funds as is necessary to maintain the Percentage Ownership Interests of the JV Investors as set forth on
Exhibit A
within ten (10) Business Days of the JV Investors’ receipt of notice of the occurrence of (i) hereof, this Agreement shall terminate automatically without any further actions by the Parties and all previous contributions to the Company shall be returned promptly to the relevant JV Investor who made such contribution originally.
|
4.1
注册资本与投资总额:合资公司初始注册资本为
13625852
美元(下称:注册资本),具体出资信息详见下述第
4.3
条与附件
A
。但是如果:(
i
)双方初始出资资产于评估之时,相关中国当局认定,依适用法律之规定,该等资产不值附件
A
所述之价值,且(
ii
)届时,该等投资方在收到上述(
i
)所述认定通知
10
个工作日内,未能按附件
A
所载金额追加出资到位;那么,本协议自动终止,且无需双方采取任何进一步行动,并且,对合资公司的此前出资应将立即退还原来的相关出资方。
合资公司投资总额为
2000
万美金(下称:投资总额);投资总额与注册资本的差额可以境外借款或任何其它合法方式融资。
|
3.
|
修订注册资本实缴计划
|
|
Amendment to the Payment Schedule of Initial Registered Capital Contributions
|
4.3
初始注册资本实缴计划
:合资投资方的任一方应将按其出资比例分二期支付:
(a)
第一期支付:合资公司经审批机关颁发营业执照日之次日起第
30
日。本期支付出资额如下:
(
i
)香港控股公司支付总计人民币
36,700,000
元,其中,
10,500,000
以现金,其余
26,200,000
元将由香港控股公司的股东
ZBB
能源的关联机构
ZBB
威州能源公司以香港控股公司的名义向合资公司授予知识产权的形式支付。
(
ii
)内资合资公司支付现金总计人民币
20,000,000
元。
(b)
第二期支付:不迟于
2012
年
6
月
1
日。本期支付出资额如下:
(
i
)香港控股公司支付现金总计人民币
10,500,000
元。
(
ii
)内资合资公司总计支付现金人民币
20,000,000
元。
|
4.3
Payment Schedule of Initial Registered Capital Contributions
.
Each of the JV Investors shall contribute to the Company its corresponding portion of the initial registered capital of the Company in two (2) installments:
(a)
First Installment
. The JV Investors shall contribute the respective amounts listed below within thirty (30) days following the issuance of the Business License to the Company by the Approval Authority:
|
(i) | Hong Kong Holdco shall contribute an aggregate amount of Thirty Six Million Seven Hundred Thousand Renminbi (RMB 36,700,000), of which Ten Million Five Hundred Thousand Renminbi (RMB 10,500,000) will be contributed in cash and Twenty Six Million Two Hundred Thousand Renminbi (RMB 26,200,000) will be credited to Hong Kong Holdco for the intellectual property rights granted to the Company by ZBB Corp., an Affiliate of Hong Kong Holdco member, ZBB Energy; and |
(ii) | the China JV shall contribute an aggregate amount in cash of Twenty Million Renminbi (RMB 20,000,000). | |
(b) | Second Installment . The JV Investors shall contribute the respective amounts listed below by June 1, 2012: | |
(i) | Hong Kong Holdco shall contribute an aggregate amount in cash of Ten Million Five Hundred Thousand Renminbi (RMB 10,500,000); and | |
(ii) | the China JV shall contribute an aggregate amount in cash of Twenty Million Renminbi (RMB 20,000,000). |
4.3
初始注册资本实缴计划
:合资投资方的任一方应将按其出资比例分二期支付:
(a)
第一期支付:合资公司经审批机关颁发营业执照日之次日起第
30
日,本期支付出资额如下:
(
i
)香港控股公司支付总计
5734733
美元,其中,
1640727.5
美元以现金,其余
4094006
美元将由香港控股公司的股东
ZBB
能源的关联机构
ZBB
威州能源公司以香港控股公司的名义向合资公司授予知识产权的形式支付。
(
ii
)内资合资公司支付现金总计
3125295.5
美元等值人民币。
(b)
第二期支付:不迟于
2012
年
6
月
1
日。本期支付出资额如下:
(
i
)香港控股公司支付现金总计
1640727.5
美元。
(
ii
)内资合资公司支付现金总计
3125295.5
美元等值人民币。
|
|
(i) | Hong Kong Holdco shall contribute an aggregate amount of five million seven-hundred and thirty-four thousand seven-hundred and thirty three U.S. dollars (US$ 5,734,733 ), of which one million six-hundred and forty thousand seven-hundred and twenty-seven U.S. dollars and fifty cents (US$ 1,640,727.5 ) will be contributed in cash and four million ninety-four thousand and six U.S. dollars (US$ 4,094,006 ) contributed by granting an license of intellectual property rights to the Company by ZBB Corp., an Affiliate of Hong Kong Holdco and ZBB Energy, in the name of Hong Kong Holdco; and | |
(ii) | the China JV shall contribute in RMB an aggregate amount equal to three million one-hundred and twenty-five thousand two-hundred and ninety five U.S. dollars and fifty cents (US$ 3,125,295.5 ) in cash. | |
(b) | Second Installment . The JV Investors shall contribute the respective amounts listed below by June 1, 2012: | |
(i) | Hong Kong Holdco shall contribute an aggregate amount of one million six-hundred and forty thousand seven-hundred and twenty-seven U.S. dollars and fifty cents (US$ 1,640,727.5 ) in cash; and |
(ii) | the China JV shall contribute in RMB an aggregate amount equal to three million one-hundred and twenty-five thousand two-hundred and ninety five U.S. dollars and fifty cents (US$ 3,125,295.5 ) in cash. | |
4.
|
修订附件
A
:合资公司投资双方信息
|
|
Amendment to Exhibit A: JV Investor Information
|
合资投资方
|
主要营业地
|
法定代表人
|
注册资本
|
占有比例
|
香港控股公司
|
47,200,000
人民币。
其中:
现金:
21,000,000
人民币;
知识产权折合
26,200,000
人民币,
由
ZBB
威州能源公司以许可协议项下
的许可代为出资。
|
54.13%
|
||
内资合资公司
|
40,000,000
人民币
|
45.87%
|
||
总计
|
87,200,000
人民币
|
100%
|
JV
Investor
|
Principal Office
|
Legal Representative
|
Registered Capital
|
Percentage Ownership Interest
|
Hong
Kong
Holdco
|
RMB 47,200,000
(RMB 21,000,000 contributed in cash; the remaining RMB 26,200,000 will be credited to Hong Kong Holdco for ZBB Corp.’s grant of a license to certain Intellectual Property under the License Agreement for purposes of determining the Percentage Ownership Interests of the Investors
|
54.13%
|
||
China JV
|
RMB 40,000,000
|
45.87%
|
||
Total
|
RMB 87,200,000
|
100%
|
合资投资方
|
主要营业地
|
法定代表人
|
注册资本
|
占有比例
|
香港控股公司
|
7375461
美金。
|
54.13%
|
公司
|
其中:
现金:
3281455
美元;
知识产权折合
4094006
美元,
由
ZBB
威州能源公司通过香港控股公司以许可
协议项下的许可代为出资。
|
|
||
内资合资公司
|
6250391
美元等值人民币
|
45.87%
|
||
总计
|
13625852
美元
|
100%
|
JV
Investor
|
Principal
Office
|
Legal
Representative
|
Registered Capital
|
Percentage
Ownership
Interest
|
Hong
Kong Holdco
|
US$7,375,461
(US$3,281,455 contributed in cash; the remaining US$ 4,094,006 will contributed by ZBB Corp.’s grant of a license to certain Intellectual Property under the License Agreement in the name of Hong Kong Holdco
|
54.13%
|
||
China JV
|
US$6,250,391 equivalent in RMB
|
45.87%
|
||
Total
|
US$13,625,852
|
100%
|
5.
|
其他条款
|
6.
|
语言
|
7.
|
副本
|
香港控股公司:
ZBB PowerSav Holdings Limited
“Hong Kong Holdco”
ZBB PowerSav Holdings Limited
|
内资合资公司
安徽鑫东投资管理有限公司
“
China JV
”
Anhui Xindong Investment Management Co., Ltd.
|
授权代表
/ Authorized Signatory
:
Daniel Anthony Nordloh
职位
/Title:
董事
Director
______________________________
|
授权代表
/ Authorized Signatory
:
束龙胜
职位
/Title:
董事长
Chairman of the Board
______________________________
|
1.
|
DEFINITIONS
.
|
2.
|
LICENSE
.
|
(a)
|
The Company will not manufacture, or have manufactured, the ZBB Products or the Company Products outside of Mainland China. Such limitation extends to those geographical regions considered part of Greater China (i.e., Hong Kong and Taiwan).
|
(b)
|
The Company will not reverse engineer, decompile, modify or disassemble the ZBB Products in any way, except and only to the extent such activity is permitted by law notwithstanding this limitation.
|
(c)
|
The Company will use the Trademarks on all ZBB Products, the Company Products, and any other goods incorporating, in whole or in part, the ZBB Products.
|
(d)
|
The Company will only use the Trademarks on authorized ZBB Products, the Company Products, and other goods incorporating, in whole or in part, the ZBB Products.
|
(e)
|
The Company may not make any representations, warranties, or other commitments on behalf of Hong Kong Holdco to any third party.
|
(f)
|
The Company must comply with all obligations as set forth herein and any other Company Documents.
|
3.
|
TELECOM INDUSTRY FIRST RIGHT OF REFUSAL
.
|
4.
|
INTELLECTUAL PROPERTY OWNERSHIP
.
|
5.
|
CONFIDENTIALITY
.
|
6.
|
DISCLAIMER OF WARRANTIES
.
|
7.
|
INDEMNITY
.
|
8.
|
TERM
.
|
9.
|
EFFECTS OF TERMINATION
.
|
10.
|
GOVERNING LAW; DISPUTE RESOLUTION
.
|
11.
|
MISCELLANEOUS PROVISIONS
.
|
|
Ÿ
|
You will serve as ZBB’s Executive Vice President-Operations and report to ZBB’s President and Chief Executive Officer. Your services to ZBB will be performed in Menomonee Falls, Wisconsin. You acknowledge, however, that you may be required to travel in connection with the performance of your duties hereunder.
|
|
Ÿ
|
This offer is conditional based on approval from the company’s Compensation Committee.
|
|
Ÿ
|
As a condition to your appointment, you will be required to enter into a Restrictive Covenant Agreement (Exhibit “A”).
|
|
Ÿ
|
During your employment by ZBB, you may accept a position on the board of directors of any company that does not directly compete with the business of ZBB, provided such position is approved in advance by ZBB’s Board of Directors.
|
|
Ÿ
|
Nothing contained in this letter will be construed as conferring upon you any right to remain employed by ZBB or any of its subsidiaries or affiliates or affect the right of ZBB or any of its subsidiaries or its affiliates to terminate your employment at any time for any reason or no reason, subject to the obligations of ZBB as set forth herein.
|
|
Ÿ
|
You will be entitled to an annual salary of $225,000, payable in accordance with ZBB’s normal salaried payroll practices.
|
|
Ÿ
|
The President & Chief Executive Officer will review, at least annually, your overall compensation with a view to increasing it if, in the sole judgment of the President & Chief Executive Officer, the performance of ZBB or your services merit such an increase.
|
|
Ÿ
|
ZBB shall be entitled to withhold from amounts to be paid to you hereunder any federal, state, or local withholding or other taxes or charges which it is required to withhold under applicable law.
|
|
Ÿ
|
You shall be entitled to an annual cash bonus of up to $100,000 based on meeting specific Profit & Loss (P&L) metrics (to be determined).
|
|
Ÿ
|
Effective as of the date of your appointment, you will receive two option awards.
|
|
Ÿ
|
You will be granted an option to purchase 400,000 shares with an exercise price equal to the closing price of ZBB’s common stock on the NYSE Amex on the date of your appointment. This option will be an Inducement Option.
|
|
o
|
Vesting will be over 3 years with the first 1/3 vesting one year from the start of your employment and the remaining 2/3 vesting in 24 equal monthly installments as of the end of each calendar month beginning on November 9, 2012 and ending on November 9, 2014.
|
|
o
|
This option will immediately vest upon a “Change of Control” of ZBB. The definition of “Change of Control” is attached as an exhibit to this letter.
|
|
o
|
The option will not be exercisable as to any portion thereof after the eighth anniversary of the grant date.
|
|
o
|
The option will have such other terms and conditions specified in the form of option agreement provided to you.
|
|
Ÿ
|
You will also be granted an option to purchase 100,000 shares with the same exercise price specified above.
|
|
o
|
The option will vest in two equal installments upon the Compensation Committee’s confirmation that certain performance targets are met (to be determined).
|
|
o
|
The option will not be exercisable as to any portion thereof after the eighth anniversary of the grant date.
|
|
o
|
The option will have such other terms and conditions specified in the form of option agreement provided to you.
|
|
Ÿ
|
We will reimburse your commuting expenses to and from ZBB’s corporate offices in the following manner:
|
|
o
|
IRS mileage reimbursement for miles that exceed 60 miles round trip to and from your home to ZBB’s corporate offices.
|
|
o
|
This reimbursement will not exceed $10,000 per year.
|
|
Ÿ
|
Expenses for other company travel will be reimbursed in accord with ZBB’s travel policy.
|
|
Ÿ
|
During the term of your employment by ZBB, ZBB will provide you with, and you will be eligible for, all benefits of employment generally made available to the senior executives of ZBB (collectively, the “Benefit Plans”), subject to and on a basis consistent with the terms, conditions and overall administration of such Benefit Plans. You will be considered for participation in Benefit Plans which by the terms thereof are discretionary in nature (such as stock option plans) on the same basis as other executive personnel of ZBB of similar rank.
|
|
Ÿ
|
You will receive four (4) weeks of Personal Time Off (PTO) per calendar year, in accordance with Company policy in effect from time to time.
|
|
Ÿ
|
You will also receive 10 paid holidays per calendar year, in accordance with Company policy in effect from time to time.
|
|
Ÿ
|
Without giving effect to the timing of the payment of your base salary for 2011 as set forth in Section 2, above, you will be entitled to a severance payment in an amount equal to four (4) months of your annual base salary as then in effect paid in accordance with ZBB’s normal salaried payroll practices as then in effect in the event (a) ZBB terminates your employment for any reason other than “Cause” or “Disability”, (b) you terminate your employment with ZBB for “Good Reason”, or (c) you die. In the event your employment with ZBB is terminated due to “Disability,” you will be entitled to a severance payment in an amount equal to your base salary as then in effect from the date of termination through the date on which benefits under the long-term disability policy begin, but in no event longer than 90 days, paid in accordance with ZBB’s normal salaried payroll practices as then in effect. The definitions of “Cause”, “Disability” and “Good Reason” are attached as an exhibit to this letter. In each case, this severance benefit will be contingent on your execution of a release in a form acceptable to ZBB which is not withdrawn or otherwise revoked within the applicable statutory and/or regulatory time periods or otherwise. You will also be entitled to all accrued and unpaid benefits under any Benefit Plans in which you participate through the date of termination.
|
|
Ÿ
|
If you terminate your employment with ZBB for “Good Reason”, and if you elect to continue your health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) following such termination, then ZBB shall pay your monthly premium under COBRA until the earlier of: (i) the last day of the four month period following such termination or (ii) the date on which you are offered or obtain health insurance coverage in connection with new employment or self-employment. If you are not eligible for COBRA coverage because you have waived health insurance coverage, then, subject to the dollar limits above, ZBB shall pay your monthly premium for long-term disability conversion coverage until the earlier of: (i) the last day of the four month period following such termination or (ii) the date on which you are offered or obtain long-term disability insurance coverage in connection with new employment or self-employment
|
|
Ÿ
|
If you terminate your employment with ZBB other than for “Good Reason” or ZBB terminates your employment for “Cause”, you will be entitled to the payment of any accrued but unpaid base salary through the date of termination, plus all accrued and unpaid benefits under any Benefit Plans in which you participate through the date of termination. In either case, you will not be entitled to any severance payment and you will not be entitled to the payment of the premiums specified above.
|
|
Ÿ
|
As a condition to your appointment, you will be required to enter into a restrictive covenant agreement. If you breach the provisions of the restrictive covenant agreement, then you shall forfeit any unpaid severance payments and COBRA coverage premiums as of the time of ZBB’s determination of the breach, and you shall repay to ZBB any severance payments and COBRA coverage premiums you have received as of the time of ZBB’s determination of the breach as soon as practicable after ZBB provides a written demand for payment to you.
|
|
Ÿ
|
As a condition to your appointment, you will be required to provide a resignation from the Board of Directors in the form previously provided to you.
|
|
Ÿ
|
You hereby represent and warrant that you are not bound by any employment or confidentiality agreement or other obligation or commitment, whether contractual or otherwise, that would be inconsistent, or place you in a position of conflict, with your position as Executive Vice President-Operations of ZBB or this letter agreement.
|
|
Ÿ
|
The date of your appointment as Executive Vice President-Operations of ZBB will be November 9, 2011.
|
|
Ÿ
|
This offer is conditional based on completion of a drug test with a negative result and background check.
|
|
Ÿ
|
This letter agreement shall be binding upon any successor (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of ZBB’s business and/or assets. For all purposes under this Agreement, the term “ZBB” shall include any successor to ZBB’s business and/or assets which become bound by this letter agreement.
|
|
Ÿ
|
This letter agreement and all of your rights hereunder shall inure to the benefit of, and be enforceable by, your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.
|
|
Ÿ
|
Notices and all other communications contemplated by this letter agreement shall be in writing and shall be deemed to have been duly given when personally delivered or when mailed by overnight courier or U.S. registered or certified mail, return receipt requested and postage prepaid. In the case of notices to you, notices shall be addressed to you at the home address which you most recently communicated to ZBB in writing. In the case of notices to ZBB, notices shall be addressed to its corporate headquarters, and all notices shall be directed to the attention of its Secretary.
|
|
Ÿ
|
No provision of this letter agreement shall be modified, waived or discharged unless the modification, waiver or discharge is agreed to in writing and signed by you and by an authorized officer of ZBB (other than you). No waiver by either party of any breach of, or of compliance with, any condition or provision of this letter agreement by the other party shall be considered a waiver of any other condition or provision or of the same condition or provision at another time.
|
|
Ÿ
|
No other agreements, representations or understandings (whether oral or written and whether express or implied) which are not expressly set forth or referenced in this letter agreement have been made or entered into by either party with respect to the subject matter hereof. This letter agreement and the other agreements, representations and understandings expressly set forth or referenced herein contain the entire understanding of the parties with respect to the subject matter hereof.
|
|
Ÿ
|
Any termination of this letter agreement shall not release either ZBB or you from our respective obligations to the date of termination nor from the provisions of this letter agreement which, by necessary or reasonable implication, are intended to apply after termination of this letter agreement.
|
|
Ÿ
|
The validity, interpretation, construction and performance of this letter agreement shall be governed by the laws of the State of Wisconsin (other than provisions governing the choice of law).
|
|
Ÿ
|
The invalidity or unenforceability of any provision or provisions of this letter agreement shall not affect the validity or enforceability of any other provision hereof, which shall remain in full force and effect.
|
|
Ÿ
|
This letter agreement and all your rights and obligations hereunder are personal to you and may not be transferred or assigned by you at any time. ZBB may assign its rights under this letter agreement to any entity that assumes ZBB’s obligations hereunder in connection with any sale or transfer of all or a substantial portion of ZBB’s assets to such entity.
|
|
Ÿ
|
This letter agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
|
With warm regards, | |
ZBB ENERGY CORPORATION | |
Eric Apfelbach | |
President & Chief Executive Officer |
ZBB ENERGY CORPORATION | ||
By: | ________________________________________ | |
Name:
|
||
Title: |
______________________________________________ | |
Employee |
1.
|
Definitions
.
|
2.
|
Registration under the Securities Act
:
|
(a)
|
Demand Registration
. At any time during the two year period commencing upon the date hereof, the holders of at least fifty percent (50%) of the Registrable Securities may notify the Company that they intend to offer or cause to be offered for public sale all or any portion of their Registrable Securities in a registered public offering on Form S-3. Such requests shall be in writing and shall state the number of shares of Registrable Securities to be disposed of and the intended method of disposition of such shares by such holder or holders. The Company will use its best efforts to expeditiously effect the registration of all Registrable Securities whose holders request participation in such registration under the Securities Act, but only to the extent provided for in this Agreement; provided, however, that the Company shall not be required to effect registration pursuant to a request under this Section 2(a) more than once.
|
(b)
|
Right to Piggyback
. Subject to Sections 2(d) hereof, if at any time during the two year period commencing upon the date hereof, the Company proposes to file a Registration Statement under the Securities Act with respect to any offering of shares of Common Stock by the Company for its own account and/or on behalf of any of its security holders (including a registration pursuant to Section 2(a) above) and the registration form to be used may be used for the registration of Registrable Securities (other than (i) a registration on Form S-8 or S-4 or any successor form, (ii) a registration relating to a transaction subject to Rule 145 under the Securities Act, (iii) any registration of securities as it relates to an offering and sale to management of the Company pursuant to any employee stock plan or other employee benefit plan arrangement or (iv) any registration pursuant to the Amended and Restated Securities Purchase Agreement dated August 30, 2010 between the Company and Socius CG II, Ltd.) then, as soon as practicable (but in no event less than twenty (20) days prior to the proposed date of filing such Registration Statement), the Company shall give written notice of such proposed filing to the Holders, and such notice shall offer the Holders the opportunity to register such number of Registrable Securities as the Holders may request (a “Registration Request“). Subject to Section 2(d), the Company shall include in such Registration Statement all Registrable Securities requested within fifteen (15) days after the receipt of any such notice (which request shall specify the Registrable Securities intended to be disposed of by the Holders) to be included in the registration for such offering pursuant to a Registration Request; provided, however, that if, at any time after giving written notice of its intention to register shares of Common Stock and prior to the effective date of the Registration Statement filed in connection with such registration, the Company shall determine for any reason not to register or to delay registration of such shares of Common Stock, the Company may, at its election, give written notice of such determination to the Holders of Registrable Securities and, thereupon, (i) in the case of a determination not to register, shall be relieved of its obligation to register any Registrable Securities in connection with such registration, and (ii) in the case of a determination to delay registering, shall be permitted to delay registering any Registrable Securities, for the same period as the delay in registering such shares of Common Stock.
|
(c)
|
Expenses
. The Registration Expenses of the Holders of Registrable Securities will be paid by the Company in a Registration Request. Underwriting or brokerage discounts and commissions, transfer taxes, if any, and any expenses of a Holder for counsel relating to the sale or disposition of such Holder’s Registrable Securities pursuant to such Registration Statement shall be borne by the Holder.
|
(d)
|
Underwriter’s Cutback
. Notwithstanding Section 2(b), if a Registration Request involves an underwritten offering being made on behalf of the Company, and the managing underwriter or underwriters advise the Company in writing that in their opinion the number of shares of Common Stock requested to be included in such registration exceeds the number which can be sold in such offering or would be reasonably likely to adversely affect the price or distribution of the shares of Common Stock offered in such offering or the timing thereof, then the shares of Common Stock to be included in such registration shall be the number of shares of Common Stock, adjusted on a pro rata basis based on the number of shares requested to be registered, that, in the opinion of such underwriter or underwriters, can be sold without an adverse effect on the price, timing or distribution of the shares of Common Stock to be included.
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3.
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Registration Procedures
. In connection with the Company’s obligations under Section 2 hereof, the Company shall use it best efforts to effect or cause to be effected the registration of the Registrable Securities under the Securities Act to permit offers and sales in accordance with the intended method or methods of distribution thereof. In addition, and as a condition to Stockholder’s right pursuant to Section 2(b), Stockholder shall execute such underwriting agreement and otherwise sell the Registrable Securities on the same terms as applicable to the offering of shares pursuant to such registration generally.
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4.
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Indemnification
.
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(a)
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The Company agrees to indemnify, to the extent permitted by law, each Holder of Registrable Securities, its officers and directors and each person or entity who controls such Holder (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and expenses caused by any untrue statement of material fact contained in any registration statement, prospectus or preliminary prospectus or any amendment thereof or supplement thereto or any 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 such Holder expressly for use therein or by such Holder’s failure to deliver a copy of the registration statement or prospectus or any amendments or supplements thereto after the Company has furnished such holder with same.
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(b)
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In connection with any registration statement in which a Holder of Registrable Securities is participating, each such Holder will furnish to the Company in writing such information and affidavits as the Company reasonably requests for use in connection with any such registration statement or prospectus and, to the extent permitted by law, will indemnify the Company, its directors and officers and each person or entity who controls the Company (within the meaning of the Securities Act) against any losses, claims, damages, liabilities and expenses resulting from any untrue statement of material fact contained in the registration statement, prospectus or preliminary prospectus or any amendment thereof or supplement thereto or any 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 such Holder; provided that the obligation to indemnify will be several, not joint and several, among such Holder of Registrable Securities and the liability of each such Holder of Registrable Securities will be in proportion to and limited to the net amount received by such Holder from the sale of Registrable Securities pursuant to such registration statement.
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(c)
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Any person or entity entitled to indemnification hereunder will (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification; provided, however, that failure to give such notice will not prejudice such person’s or entity’s right to indemnification from the indemnifying party, except as to any losses suffered by such person or entity which are attributable to such person’s or entity’s failure to promptly give such notice to such 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. The indemnifying party will not be subject to any liability for any settlement made by the indemnified party without its consent (but such consent will not be unreasonably withheld). An indemnifying party who is not entitled to, or elects not to, assume the defense of a claim will 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.
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(d)
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The indemnification provided for under this Agreement will 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 or entity of such indemnified party and will survive the transfer of securities and the termination of this Agreement. The Company also agrees to make such provisions as are reasonably requested by any indemnified party for contribution to such party in the event the Company’s indemnification is unavailable for any reason.
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5.
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Miscellaneous
.
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(a)
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Amendments and Waivers
. The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the Company has obtained the written consent of Holder holding at least two-thirds of the Registrable Securities to such amendment, modification, or supplement or waiver or consents to such departures.
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(b)
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Notices
. All notices and other communications provided for or permitted under this Agreement shall be in writing and given in accordance with the notice provision in the Stock Purchase Agreement.
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(c)
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Governing Law
. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Wisconsin.
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(d)
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Severability
. In the event that any one or more of the provisions contained herein, or the application, thereof in any circumstance, is held invalid, illegal or unenforceable, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be affected or impaired thereby.
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(e)
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Successors and Assigns
. All covenants and agreements in this Agreement by or on behalf of any of the parties hereto will bind and inure to the benefit of the respective permitted successors and assigns of the parties hereto whether so expressed or not. The registration rights of the Holder under this Agreement may be transferred to any transferee who lawfully acquires Registrable Securities; provided, that the Company is given written notice by the Holder at the time of such transfer stating the name and address of the transferee and identifying the securities with respect to which the rights under this Agreement are being assigned; and provided, further, that such transferee is a person who is reasonably satisfactory to the Company and executes an agreement in writing agreeing to be bound by the provisions of this Agreement.
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ZBB ENERGY CORPORATION | |
By: | |
Eric C. Apfelbach | |
President and Chief Executive Officer | |
Purchaser | ||
Signature of Purchaser | ||
Title, if Purchaser is an entity | ||
Address: | ||
February 9, 2012 | /s/ Eric C. Apfelbach |
Eric C. Apfelbach | |
(Principal Executive Officer) |
CERTIFICATION | Exhibit 31.2 |
February 9, 2012 | /s/ Will Hogoboom |
Will Hogoboom
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(Principal Financial Officer)
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February 9, 2012 | /s/ Eric C. Apfelbach |
Eric C. Apfelbach | |
(Principal Executive Officer) |
February 9, 2012 | /s/ Will Hogoboom |
Will Hogoboom | |
(Principal Financial Officer)
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