Common use of Method of Exercise; Settlement of Warrant Clause in Contracts

Method of Exercise; Settlement of Warrant. In order to exercise a Warrant, the Holder thereof must (i) surrender the Warrant Certificate evidencing such Warrant to the Warrant Agent, with the form on the reverse of or attached to the Warrant Certificate duly executed (the date of the surrender of such Warrant Certificate, the “Exercise Date”), and (ii) if Net Share Settlement is not elected, deliver in full the aggregate Exercise Price then in effect for the shares of Underlying Common Stock as to which a Warrant Certificate is submitted for exercise, not later than the Settlement Date as more fully set forth herein. Full Physical Settlement shall apply to each Warrant unless the Holder elects for Net Share Settlement to apply upon exercise of such Warrant. Such election shall be made in the form on the reverse of or attached to the Warrant Certificate for such Warrant. (a) If Full Physical Settlement is applicable with respect to the exercise of a Warrant, then, for each Warrant exercised hereunder (i) prior to 11:00 a.m., New York City time, on the Settlement Date for such Warrant, the Holder shall pay the aggregate Exercise Price (determined as of such Exercise Date) for the number of shares of Common Stock obtainable upon exercise of such Warrant at such time by federal wire or other immediately available funds payable to the order of the Company to the account maintained by the Warrant Agent and notified to the Holder upon request of the Holder, and (ii) on the Settlement Date, following receipt by the Warrant Agent of such Exercise Price, the Company shall cause to be delivered to the Holder the number of shares of Common Stock obtainable upon exercise of each Warrant at such time (the “Full Physical Share Amount”), together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f). (b) If Net Share Settlement is applicable with respect to the exercise of a Warrant, then, for each Warrant exercised hereunder, on the Settlement Date for such Warrant, the Company shall cause to be delivered to the Holder a number of shares of Common Stock (which in no event will be less than zero) (the “Net Share Amount”) equal to (i) the number of shares of Common Stock obtainable upon exercise of such Warrant at such time, multiplied by (ii) the Closing Sale Price on the relevant Exercise Date, minus the Exercise Price (determined as of such Exercise Date), divided by (iii) such Closing Sale Price, together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f). (c) Upon surrender of a Warrant Certificate in conformity with the foregoing provisions and receipt by the Warrant Agent of the Exercise Price therefor or, in the event of Net Share Settlement, upon the election by a Holder for Net Share Settlement, the Warrant Agent shall thereupon promptly notify the Company, and the Company shall instruct its transfer agent

Method of Exercise; Settlement of Warrant. (a) In order to exercise a Warrantcertain number of Warrants hereunder, the Holder thereof must (i) surrender the a Warrant Certificate to Hydrogenics evidencing such Warrant number of Warrants to be exercised, by same day personal delivery or electronic transmission at the Warrant Agentaddress of notice set out in Section 9.3, with the form on the reverse of or attached to the Warrant Certificate properly completed and duly executed (the date of the surrender of such Warrant Certificate, the an “Exercise Date”), and (ii) if Net Share Settlement is not elected, deliver in full the aggregate applicable Aggregate Exercise Price then in effect for the shares aggregate number of Underlying Common Stock as to which a Warrant Certificate is submitted for exerciseShares obtainable upon exercise of such Warrants (the “Acquired Common Shares”), not later than the applicable Settlement Date as more fully set forth herein. Full Physical Settlement shall apply to each Warrant unless the Holder elects for Net Share Settlement to apply upon exercise of such Warrant. Such election shall be made in the form on the reverse of or attached to the Warrant Certificate for such Warrant. (ab) If Full Physical Settlement is applicable with respect to the exercise of a WarrantFor all Warrants exercised hereunder, then, for each Warrant exercised hereunder (i) prior to 11:00 9:00 a.m., New York City Toronto time, on the applicable Settlement Date for such WarrantWarrants, the Holder shall pay the aggregate applicable Aggregate Exercise Price (determined as of such Exercise Date) for the number of shares of Common Stock obtainable upon exercise of such Warrant at such time by federal wire transfer or other immediately available funds payable to, or to the order of the Company to the account maintained by the Warrant Agent and notified to the Holder upon request of the Holderof, and (ii) on the Settlement Date, following receipt by the Warrant Agent of such Exercise Price, the Company shall cause to be delivered to the Holder the number of shares of Common Stock obtainable upon exercise of each Warrant at such time (the “Full Physical Share Amount”), together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f). (b) If Net Share Settlement is applicable with respect to the exercise of a Warrant, then, for each Warrant exercised hereunder, on the Settlement Date for such Warrant, the Company shall cause to be delivered to the Holder a number of shares of Common Stock (which in no event will be less than zero) (the “Net Share Amount”) equal to (i) the number of shares of Common Stock obtainable upon exercise of such Warrant at such time, multiplied by (ii) the Closing Sale Price on the relevant Exercise Date, minus the Exercise Price (determined as of such Exercise Date), divided by (iii) such Closing Sale Price, together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f)Hydrogenics. (c) Upon surrender of a Warrant Certificate to Hydrogenics as provided in conformity with the foregoing provisions Section 3.4(a) and receipt by the Warrant Agent Hydrogenics of the applicable Aggregate Exercise Price therefor on the applicable Settlement Date as provided in Section 3.4(b), Hydrogenics will cause to be delivered to the Holder within three (3) Business Days, at the address of notice set out in Section 9.3, in its sole discretion, either (i) certificate or certificates evidencing the number of Acquired Common Shares; or (ii) evidence that such Holder’s interest in the Acquired Common Shares has been registered in the book-based system of CDS Clearing and Depository Services Inc., or its successor. (d) The Holder acknowledges that Hydrogenics is, as of the date hereof, a party to a Governance Agreement dated October 16, 2001 between Hydrogenics and General Motors Corporation (now General Motors Holding LLC (“GM”)) under which Hydrogenics has granted GM certain rights with respect to issuances of equity securities by Hydrogenics as set out in Article 5 thereof (the “GM Pre-Emptive Right”). Hydrogenics shall, within two business days of receiving from the Holder all deliverables required under Section 3 hereof to effect the exercise of the Warrants, deliver a notice to GM, if required, specifying the terms and conditions of the proposed issuance of Common Shares to the Holder upon exercise of the Warrants, including the number of Common Shares that GM would be entitled to purchase under the GM Pre-Emptive Right (the “GM Pre-Emptive Shares”). If GM exercises the GM Pre-Emptive Right, Hydrogenics may, at its sole option, reduce the number of Common Shares otherwise issuable to the Holder upon exercise of the Warrants by the Holder’s pro rata share of the number of Common Shares to be issued to GM under the GM Pre-Emptive Right (the “Substituted Shares”), in which case Hydrogenics shall pay to the Holder, in lieu of the Substituted Shares, a cash payment per Substituted Share in the amount of the Market Price of the Common Shares on the date the Warrants are exercised (the “Substituted Cash Amount”). (e) If fewer than all the Warrants represented by a Warrant Certificate are surrendered and the rights under this Agreement have not expired as provided in Section 3.3, a new Warrant Certificate of the same tenor and for the number of Warrants that were not surrendered shall promptly be executed by Hydrogenics and delivered to the Holder or, subject to Section 5, to such Person or Persons as directed by the Holder who originally surrendered such Warrants. (f) Hydrogenics shall not be required to issue any fraction of a Common Share upon exercise of any Warrants; provided, that, if more than one Warrant shall be exercised hereunder at one time by the same Holder, the number of full Common Shares which shall be issuable upon exercise thereof shall be computed on the basis of all Warrants so exercised, and shall include the aggregation of all fractional Common Shares issuable upon exercise of such Warrants. If after giving effect to the aggregation of all Common Shares (and fractions thereof) issuable upon exercise of Warrants by the same Holder at one time as set forth in the event previous sentence, any fraction of Net a Common Share Settlementwould, upon except as provided in this Section 3.4(f), be issuable on the election by a exercise of any Warrant or Warrants, Hydrogenics shall pay the Holder for Net Share Settlement, cash in lieu of such fractional share valued at the Warrant Agent shall thereupon promptly notify Closing Sale Price on the Company, and the Company shall instruct its transfer agentExercise Date.

Method of Exercise; Settlement of Warrant. In order to exercise a Warrant, the Holder thereof must (i) surrender the Warrant Certificate evidencing such Warrant to the Warrant Agent, with the form on the reverse of or attached to the Warrant Certificate duly executed (the date of the surrender of such Warrant Certificate, the “Exercise Date”), and (ii) if Net Share Settlement is not elected, deliver in full the aggregate Exercise Price then in effect for the shares of Underlying Common Stock as to which a Warrant Certificate is submitted for exercise, not later than the Settlement Date as more fully set forth herein. Full Physical Settlement shall apply to each Warrant unless the Holder elects for Net Share Settlement to apply upon exercise of such Warrant. Such election shall be made in the form on the reverse of or attached to the Warrant Certificate for such Warrant. (a) If Full Physical Settlement is applicable with respect to the exercise of a Warrant, then, for each Warrant exercised hereunder (i) prior to 11:00 a.m., New York City time, on the Settlement Date for such Warrant, the Holder shall pay the aggregate Exercise Price (determined as of such Exercise Date) for the number of shares of Common Stock obtainable upon exercise of such Warrant at such time by federal wire or other immediately available funds payable to the order of the Company to the account maintained by the Warrant Agent and notified to the Holder upon request of the Holder, and (ii) on the Settlement Date, following receipt by the Warrant Agent of such Exercise Price, the Company shall cause to be delivered to the Holder the number of shares of Common Stock obtainable upon exercise of each Warrant at such time (the “Full Physical Share Amount”), together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f). (b) If Net Share Settlement is applicable with respect to the exercise of a Warrant, then, for each Warrant exercised hereunder, on the Settlement Date for such Warrant, the Company shall cause to be delivered to the Holder a number of shares of Common Stock (which in no event will be less than zero) (the “Net Share Amount”) equal to (i) the number of shares of Common Stock obtainable upon exercise of such Warrant at such time, multiplied by (ii) the Closing Sale Price on the relevant Exercise Date, minus the Exercise Price (determined as of such Exercise Date), divided by (iii) such Closing Sale Price, together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f). (c) Upon surrender of a Warrant Certificate in conformity with the foregoing provisions and receipt by the Warrant Agent of the Exercise Price therefor or, in the event of Net Share Settlement, upon the election by a Holder for Net Share Settlement, the Warrant Agent shall thereupon promptly notify the Company, and the Company shall instruct its transfer agent 1 Note to Draft: Insert the date that is the seventh anniversary of the date on which the Warrants are issued. to transfer to the Holder of such Warrant Certificate appropriate evidence of ownership of any shares of Underlying Common Stock or other securities or property to which the Holder is entitled, registered or otherwise placed in, or payable to the order of, such name or names as may be directed in writing by the Holder, and shall deliver such evidence of ownership to the Person or Persons entitled to receive the same, together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f), provided that if the Holder shall direct that such securities be registered in a name other than that of the Holder, such direction shall be tendered in conjunction with a signature guarantee from an eligible guarantor institution participating in a signature guarantee program approved by the Securities Transfer Association, and any other reasonable evidence of authority that may be required by the Warrant Agent. Upon receipt by the Warrant Agent of the Exercise Price therefor or, in the event of Net Share Settlement, upon the election by a Holder for Net Share Settlement, a Holder shall be deemed to own and have all of the rights associated with any Underlying Common Stock or other securities or property to which such Holder is entitled pursuant to this Agreement upon the surrender of a Warrant Certificate in accordance with this Agreement. (d) The Company acknowledges that the bank accounts maintained by the Warrant Agent in connection with its performance under this Agreement shall be in the Warrant Agent’s name and that the Warrant Agent may receive investment earnings in connection with the investment at the Warrant Agent’s risk and for its benefit of funds held in those accounts from time to time. The Warrant Agent shall remit any payments received in connection with the exercise of Warrants to the Company as soon as practicable and in any event within three Business Days by federal wire or other immediately available funds to an account selected by the Company and notified to the Warrant Agent. (e) If fewer than all the Warrants represented by a Warrant Certificate are surrendered, such Warrant Certificate shall be surrendered and a new Warrant Certificate of the same tenor and for the number of Warrants that were not surrendered shall promptly be executed and delivered to the Warrant Agent by the Company. The Warrant Agent shall promptly countersign the new Warrant Certificate, register it in such name or names as may be directed in writing by the Holder and deliver the new Warrant Certificate to the Person or Persons entitled to receive the same. (f) The Company shall not be required to issue any fraction of a share of Common Stock upon exercise of any Warrants; provided, that, if more than one Warrant shall be exercised hereunder at one time by the same Holder, the number of full shares of Common Stock which shall be issuable upon exercise thereof shall be computed on the basis of all Warrants so exercised, and shall include the aggregation of all fractional shares of Common Stock issuable upon exercise of such Warrants. If after giving effect to the aggregation of all shares of Common Stock (and fractions thereof) issuable upon exercise of Warrants by the same Holder at one time as set forth in the previous sentence, any fraction of a share of Common Stock would, except for the provisions of this Section 3.4(f), be issuable on the exercise of any Warrant or Warrants, the Company shall pay the Holder cash in lieu of such fractional share valued at the Closing Sale Price on the Exercise Date.

Method of Exercise; Settlement of Warrant. In order to exercise a Warrant, the a Holder thereof of Warrants must (i) surrender the Warrant Certificate evidencing such Warrant submit to the Warrant AgentAgent (or, with respect to a Beneficial Holder of Warrants, to such Beneficial Holder’s broker) a duly completed and executed exercise form for the exercise of such Warrants substantially in the form on the reverse of or attached to the Exhibit B hereto (each, a “Warrant Certificate duly executed (Exercise Form”, and the date of the surrender submission of such duly completed and executed Warrant CertificateExercise Form, the “Exercise Date”), and (ii) if Net Share Settlement is not elected, deliver in full the aggregate Exercise Price then in effect for the shares of Underlying Common Stock as to which a Warrant Certificate is submitted for exercise, not later than the Settlement Date as more fully set forth herein. Full Physical Settlement shall apply to each Warrant unless the Holder elects for Net Share Settlement to apply upon exercise of such Warrant. Such election shall be made in the form on the reverse of or attached to the Warrant Certificate for such Warrant. (a) If Full Physical Settlement is applicable with respect to the exercise of a Warrant, then, for each Warrant exercised hereunder (i) prior to 11:00 a.m., New York City time, on the Settlement Date for such Warrant, the Holder shall pay the aggregate Exercise Price (determined as of such Exercise Date) for the number of shares of Common Stock obtainable upon exercise of such Warrant at such time by federal wire or other immediately available funds payable to the order of the Company to the account maintained by the Warrant Agent and notified to the Holder upon request of the Holder, and (ii) on the Settlement Date, following receipt by the Warrant Agent of such Exercise Price, the Company shall cause to be delivered to the Holder the number of shares of Common Stock obtainable upon exercise of each Warrant at such time (the “Full Physical Share Amount”), together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f). (b) If Net Share Settlement is applicable with respect to the exercise of a Warrant, then, for For each Warrant exercised hereunder, on the Settlement Date for such Warrant, the Company shall cause to be delivered to the Holder thereof a number of shares of Common Stock (which will in no event will be less than zero) (the “Net Share Amount”) equal to (i) the number of shares of Common Stock obtainable issuable upon exercise of such Warrant at such time, multiplied by (ii) the Closing Sale Price on the relevant Exercise Date, minus the Exercise Price (determined as of such Exercise Date), divided by (iii) such Closing Sale Price, together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(f3.4(e). The Warrant Agent shall not take any action under this Section unless and until the Company has provided it with written instructions indicating the Net Share Amount. The Warrant Agent shall have no duty or obligation to investigate or confirm whether the Company’s determination of the Net Share Amount is accurate or correct. (cb) Upon surrender the proper exercise of a Warrant Certificate any Warrants in conformity accordance with the foregoing provisions and receipt by the Warrant Agent of the Exercise Price therefor or, in the event of Net Share Settlement, upon the election by a Holder for Net Share Settlementprovisions, the Warrant Agent shall thereupon promptly notify the Company, and the Company shall instruct its transfer agentagent to transfer to the Holder of such Warrants appropriate evidence of ownership of any shares of Underlying Common Stock or other securities or property to which such Holder is entitled, registered or otherwise placed in the name of the Holder or, subject to Section 3.6, in the name or names of such other Persons as may be directed in writing by the Holder, and shall deliver such evidence of ownership to the Person or Persons entitled to receive the same, together with cash in respect of any fractional shares of Common Stock as provided in Section 3.4(e), provided that if the Holder shall direct that such securities be registered in the name of a Person other than the Holder, such direction shall be tendered in conjunction with any evidence of authority that may be required by the Warrant Agent, including but not limited to, a signature guarantee from an eligible guarantor institution participating in a signature guarantee program approved by the Securities Transfer Association. Upon the due exercise of Warrants in accordance with this Section 3.4, the Holder thereof (or such other Persons as directed by such Holder pursuant to this Section 3.4(b)) shall be deemed to own and have all of the rights associated with any Underlying Common Stock or other property to which such Holder is entitled pursuant to this Agreement upon the due exercise of Warrants in accordance with this Agreement. (c) The Company acknowledges that the bank accounts maintained by the Warrant Agent in connection with its performance under this Agreement shall be in the Warrant Agent’s name and that the Warrant Agent may receive investment earnings in connection with the investment at the Warrant Agent’s risk and for its benefit of funds held in those accounts from time to time. The Company will not receive interest on any deposits. (d) All disputes or questions as to the validity, form and sufficiency (including time of receipt) of any exercised Warrant, Warrant Exercise Form or Warrant Certificate will be determined by the Company in its reasonable discretion, which determination shall be final and binding absent any manifest error. The Company reserves the right to reject any and all Warrant Exercise Forms that the Company determines not to be duly completed and executed, or for which any corresponding agreement by the Company to issue Common Stock would, in the opinion of the Company, be unlawful. Such determination by the Company shall be final and binding on all Holders, absent manifest error. The Company reserves the right to waive any condition to the exercise of Warrants or defects or irregularity with regard to any exercise of Warrants. Neither the Company nor the Warrant Agent shall be under any duty to give notice to the Holders of the Warrants of any defects or irregularities with regard to any exercise of Warrants, nor shall the Company or the Warrant Agent incur any liability for the failure to give such notice. (e) The Company shall not be required to issue any fraction of a share of Common Stock upon exercise of any Warrants; provided that, if more than one Warrant shall be exercised hereunder at one time by the same Holder, the number of full shares of Common Stock which shall be issuable upon exercise thereof shall be computed on the basis of all Warrants so exercised, and shall include the aggregation of all fractional shares of Common Stock issuable upon exercise of such Warrants. If after giving effect to the aggregation of all shares of Common Stock (and fractions thereof) issuable upon exercise of Warrants by the same Holder at one time as set forth in the previous sentence, any fraction of a share of Common Stock would, except for the provisions of this Section 3.4(e), be issuable on the exercise of any Warrant or Warrants, the Company shall pay the Holder cash in lieu of such fractional share valued at the Closing Sale Price on the Exercise Date.