1
EXHIBIT 3
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY BE REOFFERED AND SOLD ONLY IF SO REGISTERED OR IF AN EXEMPTION
FROM REGISTRATION IS AVAILABLE.
PLAINS RESOURCES INC.
WARRANT 1
WARRANT FOR THE PURCHASE OF SHARES OF COMMON STOCK
150,000 shares
FOR VALUE RECEIVED, PLAINS RESOURCES INC., a Delaware corporation (the
"Company"), hereby certifies that SHELL LAND & ENERGY COMPANY, or its permitted
assigns (the "Holder"), is entitled to purchase from the Company, at any time
or from time to time commencing on the date hereof and prior to 5:00 P.M.,
Houston time then current, on November 12, 2002, 150,000 fully paid and
non-assessable shares of the common stock, $.10 par value per share, of the
Company for a purchase price per share of $25.00 (the "Per Share Warrant
Price"). (Hereinafter, (i) said common stock, together with any other equity
securities which may be issued by the Company with respect thereto or in
substitution therefor, is referred to as the "Common Stock," (ii) the shares of
the Common Stock purchasable hereunder are referred to as the "Warrant Shares,"
(iii) the aggregate purchase price payable hereunder for the Warrant Shares is
referred to as the "Aggregate Warrant Price," and (iv) this Warrant and all
warrants hereafter issued in exchange or substitution for this Warrant are
referred to as the "Warrant".) The Aggregate Warrant Price is not subject to
adjustment. The number of Warrant Shares and the Per Share Warrant Price is
subject to adjustment as hereinafter provided.
10. Exercise of Warrant. This Warrant may be exercised, in whole
at any time or in part from time to time, commencing on the date hereof, and
prior to 5:00 P.M., Houston time then current, on November 12, 2002, by the
Holder by the surrender of this Warrant (with the subscription form at the end
hereof duly executed) at the Company's offices in Houston, Texas, together with
proper payment of the Aggregate Warrant Price, or the proportionate part
thereof if this Warrant is exercised in part. Payment for Warrant Shares shall
be made by certified or cashier's bank check payable to the order of the
Company. If this Warrant is exercised in part, this Warrant must be exercised
for a number of whole shares of the Common Stock, and the Holder is entitled to
receive a new Warrant covering the Warrant Shares which have not been
exercised. Upon such surrender of this Warrant, the Company will (a) issue a
certificate or certificates in the name of the Holder for the largest number of
whole shares of the Common Stock to which the Holder shall be entitled (no
fractional shares being issuable upon exercise of this Warrant), and deliver
the other securities and properties receivable upon the exercise of this
Warrant, or the proportionate part thereof if this Warrant is exercised in
part, pursuant to the provisions of this Warrant. The Company shall pay all
taxes and other expenses payable in connection the preparation, execution and
delivery of stock certificates pursuant to this Section 1. Unless and until
the Warrant Shares are registered under the Securities Act of 1933, as
2
amended (the "Act") as provided for in Exhibit A-3 to the Exchange Agreement
pursuant to which this Warrant has been issued, certificates evidencing the
Warrant Shares issued upon exercise of this Warrant shall bear a restrictive
legend regarding limitations on transferability of such shares.
11. Reservation of Warrant Shares; Listing. The Company agrees
that, prior to the expiration of this Warrant, the Company will at all times
(a) have authorized and in reserve, and will keep available, solely for
issuance or delivery upon the exercise of this Warrant, the shares of the
Common Stock and other securities and properties as from time to time shall be
receivable upon the exercise of this Warrant, and (b) keep the shares of the
Common Stock receivable upon the exercise of this Warrant listed upon notice of
issuance on the American Stock Exchange or such other national securities
exchange as the Common Stock of the Company may be listed from time to time.
12. Protection Against Dilution.
1. In case the Company shall hereafter (i) pay a dividend or make
a distribution on its capital stock in shares of Common Stock, (ii) subdivide
its outstanding shares of Common Stock into a greater number of shares, (iii)
combine its outstanding shares of Common Stock into a smaller number of shares
or (iv) issue by reclassification of its Common Stock other securities of the
Company, the kind and amount of Common Stock and other securities shall be
adjusted so that the Holder of this Warrant upon the exercise hereof shall be
entitled to receive the number of shares of Common Stock or other securities of
the Company which he would have owned immediately following such action had
this Warrant been exercised immediately prior thereto. An adjustment made
pursuant to this Subsection 3(a) shall become effective immediately after the
record date in the case of a stock dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision,
combination or reclassification. If, as a result of an adjustment made
pursuant to this Subsection 3(a), the Holder of this Warrant thereafter
surrendered for exercise shall become entitled to receive shares of two or more
classes of capital stock or shares of Common Stock and other securities of the
Company, the Board of Directors (whose determination shall be made in its
reasonable judgment) shall determine the allocation of the adjusted Per Share
Warrant Price between or among shares of such classes or capital stock or
shares of Common Stock and other securities.
2. In case of any capital reorganization or reclassification, or
any consolidation or merger to which the Company is a party other than a merger
or consolidation in which the Company is a continuing corporation, or in case
of any sale or conveyance to another entity of the property of the Company as
an entirety or substantially as an entirety, or in the case of any statutory
exchange of securities with another corporation (including any exchange
effected in connection with a merger of a third corporation into the Company),
the Holder of this Warrant shall have the right thereafter to convert this
Warrant into the kind and amount of securities, cash or other property which he
would have owned or have been entitled to receive immediately after such
reorganization, reclassification, consolidation, merger, statutory exchange,
sale or conveyance had this Warrant been converted immediately prior to the
effective date of such
3
reorganization, reclassification, consolidation, merger, statutory exchange,
sale or conveyance and in any such case, if necessary, appropriate adjustment
shall be made in the application of the provisions set forth in this Section 3
with respect to the rights and interests thereafter of the Holder of this
Warrant to the end that the provisions set forth in this Section 3 shall
thereafter correspondingly be made applicable, as nearly as may reasonably be,
in relation to any shares of stock or other securities or property thereafter
deliverable on the exercise of this Warrant. The above provisions of this
Subsection 3(b) shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers, statutory exchanges, sales or
conveyances. In the event of a statutory merger, the issuer of any shares of
stock or other securities or property thereafter deliverable on the exercise of
this Warrant shall be responsible for all of the agreements and obligations of
the Company hereunder. Notice of any such reorganization, reclassification,
consolidation, merger, statutory exchange, sale or conveyance and of said
provisions so proposed to be made, shall be mailed to the Holder of this
Warrant not less than 20 days prior to such event.
3. Whenever the number of Warrant Shares purchasable upon the
exercise of this Warrant is adjusted, as herein provided, the Per Share Warrant
Price shall be adjusted by multiplying such Per Share Warrant Price immediately
prior to such adjustment by a fraction, of which the numerator shall be the
number of Warrant Shares purchasable upon exercise of this Warrant immediately
prior to such adjustment, and of which the denominator shall be the number of
Warrant Shares so purchasable immediately thereafter.
4. Whenever the number of Warrant Shares purchasable upon the
exercise of this Warrant or the Per Share Warrant Price is adjusted, as herein
provided, the Company shall promptly mail by first class mail, postage prepaid
to the Holder notice of such adjustment setting forth a brief statement of the
facts requiring such adjustment and the computation by which such adjustment
was made.
5. In the event that the Company issues securities, makes a
distribution to its stockholders or undertakes some other capital change or
transaction that the Company's Board of Directors in its reasonable judgment
determines is an issuance, distribution, change or transaction that warrants an
adjustment similar to those provided in this Section 3 based upon the intent
hereof but with respect to which the provisions hereof are not specifically
applicable, adjustments to the number of shares or other securities purchasable
and the price of shares or other securities comparable to those provided in
this Section 3 shall be made as a result of such issuance, distribution, change
or transaction.
13. Fully Paid Stock. The Company agrees that the shares of the
Common Stock represented by each and every certificate for Warrant Shares
delivered on the exercise of this Warrant shall, at the time of such delivery,
be validly issued and outstanding, fully paid and non-assessable, and not
subject to preemptive rights.
4
14. Limited Transferability. This Warrant is transferable or
assignable by the Holder and is so transferable only upon the books of the
Company which it shall cause to be maintained for the purpose. The Company may
treat the registered Holder of this Warrant as he or it appears on the
Company's books at any time as the Holder for all purposes. Any Warrant issued
upon the transfer or assignment of this Warrant will be dated the same date as
this Warrant. Provided, however, this Warrant may not be transferred unless it
is registered under the Act, or an exemption from such registration is
available.
15. Loss, etc., of Warrant. Upon receipt of evidence satisfactory
to the Company of the loss, theft, destruction or mutilation of this Warrant,
and of indemnity reasonably satisfactory to the Company, if lost, stolen or
destroyed, and upon surrender and cancellation of this Warrant, if mutilated,
the Company shall execute and deliver to the Holder a new Warrant of like date,
tenor and denomination.
16. Warrant Holder Not Shareholder. Except as otherwise provided
herein, this Warrant does not confer upon the Holder any right to vote or to
consent to or receive notice as a shareholder of the Company, as such, in
respect of any matters whatsoever, or any other rights or liabilities as a
shareholder, prior to the exercise hereof.
17. Headings. The headings of this Warrant have been inserted as
a matter of convenience and shall not affect the construction hereof.
18. Applicable Law. This Warrant shall be governed by and
construed in accordance with the law of the State of Delaware without giving
effect to the principles of conflicts of law thereof.
IN WITNESS WHEREOF, PLAINS RESOURCES INC. has caused this Warrant to
be signed by its President or Vice President this ____ day of November, 1997.
PLAINS RESOURCES INC.
By:
----------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
5
SUBSCRIPTION
The undersigned, ___________________, pursuant to the provisions of
the foregoing Warrant, hereby agrees to subscribe for and purchase
______________ shares of the Common Stock of PLAINS RESOURCES INC. covered by
said Warrant, and makes payment therefor in full at the price per share
provided by said Warrant.
Dated:
------------------
Signature:
-------------------------
Address:
-----------------------------------
-----------------------------------
-----------------------------------
ASSIGNMENT
FOR VALUE RECEIVED ________________________ hereby sells, assigns and
transfers unto _________________________ the foregoing Warrant and all rights
evidenced thereby, and does irrevocably constitute and appoint
__________________, attorney, to transfer said Warrant on the books of PLAINS
RESOURCES INC.
Dated:
------------------
Signature:
-------------------------
Address:
-----------------------------------
-----------------------------------
-----------------------------------
PARTIAL ASSIGNMENT
FOR VALUE RECEIVED _________________________ hereby assigns and
transfers unto ________________________ the right to purchase _________ shares
of the Common Stock of PLAINS RESOURCES INC. by the foregoing Warrant, and a
proportionate part of said Warrant and the rights evidenced hereby, and does
irrevocably constitute and appoint ___________________, attorney, to transfer
that part of said Warrant on the books of PLAINS RESOURCES INC.
Dated:
------------------
Signature:
-------------------------
Address:
-----------------------------------
-----------------------------------
-----------------------------------
