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EXHIBIT 4.3
WARRANT AGREEMENT
AGREEMENT, dated as of the _______ day of
____________________, 199__, by and between CRAGAR INDUSTRIES, a Delaware
corporation (the "Company"), and ________________________________________, as
Warrant Agent (the "Warrant Agent").
WITNESSETH
WHEREAS, the Company is offering for sale (the "Offering") up
to 1,000,000 shares of Common Stock, $0.01 par value ("Common Stock"), and up to
1,000,000 Warrants to Purchase Common Stock (the "Warrants"). The Common Stock
and the Warrants offered (hereinafter collectively referred to as the "Units")
may only be purchased pursuant to the Offering together, as one share of Common
Stock and one Warrant, at a price of $6.00 per Unit. The Units will be offered
on a "best-efforts, all or none" basis with respect to the first 666,667 Units
(the "Minimum Offering") and on a "best efforts" basis as to the remaining
333,333 Units, and collected or collectible subscriptions for the Minimum
Offering must be received prior to the expiration of one hundred twenty (120)
days from the commencement of the Offering unless extended by the Company one or
more times for up to a total additional one hundred twenty (120) days (the
"Minimum Offering Period");
WHEREAS, subject to the sale of the Minimum Offering within
the Minimum Offering Period, the Company desires the Warrant Agent to act on
behalf of the Company, and the Warrant Agent is willing to act in connection
with the issuance, registration, transfer, and exchange of the Warrants, the
issuance of certificates representing the Warrants ("Warrant Certificates"), the
exercise of the Warrants, and the rights of the holders thereof;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements hereinafter set forth and for the purpose of defining the
terms and provisions of the Warrants and the Warrant Certificates and the
respective rights and obligations thereunder of the Company, the holders of
Warrant Certificates and the Warrant Agent, the parties hereto agree as follows:
SECTION 1. DEFINITIONS. As used herein, the following terms shall have
the following meanings, unless the context shall otherwise require:
(a) "Corporate Office" shall mean the office of the Warrant
Agent (or its successor) at which at any particular time its principal
business shall be administered, which office is located at the date
hereof at ______________________.
(b) "Exercise Date" shall mean, as to any Warrant, the date on
which the Warrant Agent shall have received at the Corporate Office
both (a) the Warrant Certificate representing such Warrant, with the
exercise form thereon duly executed by the Registered Holder thereof or
his attorney duly authorized in writing, and (b) payment in cash, or by
official bank or certified check made payable to the Company, of an
amount in lawful money of the United States of America equal to the
applicable Stock Purchase Price.
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(c) "Market Value" shall mean, on any date specified herein,
the price obtained by taking the average, on each such trading day, of
(A) the high and low sale price of a share of Common Stock or if no
such sale takes place on any such trading day, the average of the
closing bid and asked prices thereof on any such trading day, in each
case as officially reported on all national securities exchanges on
which the Common Stock is then listed or admitted to trading, or (B) if
the Common Stock is not then listed or admitted to trading on any
national securities exchange, the closing price of the Common Stock on
such date or if no closing price is available on any such trading date,
the average of the closing bid and asked prices thereof on any such
trading date in the over-the-counter market as reported to NASDAQ, or,
if the Common Stock is not then quoted in such system, the average of
the highest and lowest bid and asked prices reported by the market
makers and dealers for the Common Stock listed as such by the National
Quotation Bureau, Incorporated or any similar successor organization.
(d) "Registered Holder" shall have the meaning given in
Section 2(e) hereof.
(e) "Stock Purchase Price" shall mean the purchase price to be
paid upon exercise of the Warrants in accordance with the terms hereof,
which price shall be $7.20 per share of Common Stock, subject to
modification and adjustment from time to time pursuant to the
provisions of Section 8 hereof.
(f) "Transfer Agent" shall mean the entity designated as the
Company's transfer agent from time to time in accordance with Section
5(d) hereof.
(g) "Warrant Expiration Date" shall mean 5:00 P.M. ( time)
on ___________ ,________ .
(h) "Warrant Register" shall have the meaning given in Section
2(d) hereof.
SECTION 2. WARRANTS AND ISSUANCE OF WARRANT CERTIFICATES:
REGISTRATION.
(a) A Warrant shall initially entitle the Registered Holder of
the Warrant Certificate representing such Warrant to purchase one share
of Common Stock upon the exercise thereof and payment of the Stock
Purchase Price (subject to modification as herein provided), in
accordance with the terms hereof.
(b) From time to time up to the Warrant Expiration Date, the
Transfer Agent shall deliver stock certificates in required whole
number denominations representing up to an aggregate of 1,000,000
shares of Common Stock, subject to adjustment as described herein, upon
the exercise of the Warrants in accordance with this Agreement.
(c) From time to time up to the Warrant Expiration Date, the
Warrant Agent shall deliver Warrant Certificates in required whole
number denominations to the persons entitled thereto in connection with
any transfer or exchange permitted under this Agreement; provided that
no Warrant Certificates shall be issued except (i) those issued upon
the exercise
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of fewer than all the Warrants represented by a Warrant Certificate, to
evidence any unexercised Warrants held by the exercising Registered
Holder; (ii) those issued upon any transfer or exchange pursuant to
Section 6; (iii) those issued in replacement of lost, stolen,
destroyed, or mutilated Warrant Certificates pursuant to Section 7; and
(iv) at the option of the Company, in such form as may be approved by
its Board of Directors, to reflect any adjustment or change in the
Stock Purchase Price or the number of shares of Common Stock
purchasable upon exercise of the Warrants made pursuant to Section 8.
(d) The Warrant Agent shall maintain books (the "Warrant
Register") for the registration of original issuance and the
registration of transfer of the Warrants. Upon the initial issuance of
the Warrants, the Warrant Agent shall issue and register the Warrants
in the names of the respective holders thereof in such denominations
and otherwise in accordance with instructions delivered to the Warrant
Agent by the Company.
(e) Prior to due presentment for registration of transfer of
any Warrant Certificate, the Company and the Warrant Agent may deem and
treat the person in whose name such Warrant Certificate shall be
registered upon the Warrant Register (the "Registered Holder"), as the
absolute owner of such Warrant Certificate and of each Warrant
represented thereby (notwithstanding any contrary notation of ownership
or other writing on the Warrant Certificate), for the purpose of any
exercise thereof, and for all other purposes, and neither the Company
nor the Warrant Agent shall be affected by any notice to the contrary.
(f) The Warrant Agent understands that the Warrants are being
issued as part of Units together with shares of the Company's Common
Stock and that the shares of Common Stock and the Warrants are
immediately detachable and may be traded separately.
SECTION 3. FORM AND EXECUTION OF WARRANT CERTIFICATE.
(a) Warrant Certificates shall be substantially in the form
annexed hereto as Exhibit A (provisions of which Exhibit are hereby
incorporated herein) and may have such letters, numbers, or other marks
of identification or designation and such legends, summaries or
endorsements printed, lithographed, or engraved thereon as the Company
may deem appropriate and as are not inconsistent with the provisions of
this Agreement, or as may be required to comply with any law or with
any rule or regulation made pursuant thereto or with any rule or
regulation of any stock exchange or other market (including the NASDAQ)
on which the Warrants may be listed, or to conform to usage. The
Warrant Certificates shall be dated the date of issuance thereof
(whether upon initial issuance, transfer, or exchange or in lieu of
mutilated, lost, stolen, or destroyed Warrant Certificates) and issued
in registered form. Warrants shall be numbered serially with the letter
W on the Warrants of all denominations.
(b) Warrant Certificates shall be executed on behalf of the
Company by its President and by its Secretary by manual signatures or
by facsimile signatures printed thereon, and shall have imprinted
thereon a facsimile of the Company's seal. In case any officer of the
Company who shall have signed any of the Warrant Certificates shall
cease to be such officer of the Company before the date of issuance of
the Warrant Certificates and
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before issue and delivery thereof, such Warrant Certificates may
nevertheless be issued and delivered by the Warrant Agent to the
Registered Holder without further action by the Company, except as
otherwise provided by Section 4 hereof. No Warrant may be exercised
until countersigned by the Warrant Agent as provided for in Section
3(c) hereof.
(c) The Warrant Agent shall countersign a Warrant only upon
the occurrence of either of the following events:
(i) if the Warrant is to be issued in exchange or
substitution for one or more previously countersigned
Warrants, as hereinafter provided, or
(ii) if the Company instructs the Warrant Agent to do
so.
SECTION 4. EXERCISE. Each Warrant, when countersigned by the Warrant
Agent, may be exercised by the Registered Holder thereof at the Corporate Office
at any time up to and including the Warrant Expiration Date, upon the payment of
the Stock Purchase Price (subject to adjustment as herein provided) and upon the
other terms and subject to the conditions set forth herein and in the applicable
Warrant Certificate. A Warrant shall be deemed to have been exercised
immediately prior to the close of business on the Exercise Date and the person
entitled to receive the securities deliverable upon such exercise shall be
treated for all purposes as the holder of such securities upon exercise thereof
as of the close of business on the Exercise Date. As soon as practicable on or
after the Exercise Date, the Warrant Agent shall deposit the proceeds received
from the exercise of a Warrant and shall notify the Company in writing of such
exercise. Promptly following, and in any event within five business days after
the date of such notice from the Warrant Agent, the Warrant Agent, on behalf of
the Company, shall cause to be issued and delivered by the Transfer Agent to the
person or persons entitled to receive the same a certificate or certificates for
the securities deliverable upon such exercise (plus a Warrant Certificate for
any remaining unexercised Warrants of the Registered Holder), unless prior to
the date of issuance of such certificates the Company shall instruct the Warrant
Agent to refrain from causing such issuance of certificates pending clearance of
checks received in payment of the Stock Purchase Price pursuant to such
Warrants. Upon the exercise of any Warrant and clearance of the funds received,
the Warrant Agent shall promptly remit the payment received for the issuance of
Common Stock issued upon exercise of the Warrant to the Company or as the
Company may direct in writing. A Warrant may only be exercised in whole number
denominations.
SECTION 5. RESERVATION OF SHARES; LISTING: PAYMENT OF TAXES;
ETC.
(a) The Company covenants that it will at all times reserve
and keep available out of its authorized Common Stock, solely for the
purpose of issue upon exercise of the Warrants, such number of shares
of Common Stock as shall then be issuable upon the exercise of all
outstanding Warrants. The Company covenants that all shares of Common
Stock which shall be issuable upon exercise of the Warrants shall, at
the time of delivery, be duly and validly issued, fully paid,
nonassessable and free from all taxes, liens, and charges with respect
to the issue thereof (other than those which the Company shall promptly
pay or discharge), and that upon issuance such shares shall be listed
on each national securities
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exchange, if any, or on the NASDAQ, on which the other outstanding
shares of Common Stock of the Company are then listed.
(b) The Company has filed with the Securities and Exchange
Commission a Registration Statement No. _____ (the "Registration
Statement") on Form SB-2 for the registration, under the Securities Act
of 1933, as amended (the "Securities Act"), of, among other securities,
the Warrants and the Common Stock issuable upon exercise of the
Warrants. The Company agrees that, if necessary, it shall file with the
Securities and Exchange Commission a post-effective amendment to the
Registration Statement, or a new registration statement, for the
registration, under the Securities Act of the Common Stock issuable
upon exercise of the Warrants. In either case, the Company will use its
best efforts to cause the same to become effective and to maintain the
effectiveness of such registration statement until the expiration of
the Warrants in accordance with the provisions of this Agreement.
(c) The Company shall pay all documentary, stamp, or similar
taxes and other governmental charges that may be imposed with respect
to the issuance of the Warrants, or the issuance or delivery of any
shares of Common Stock upon exercise of the Warrants; provided,
however, that if the shares of Common Stock are to be delivered in a
name other than the name of the Registered Holder of the Warrant
Certificate representing any Warrant being exercised, then no delivery
shall be made unless the person requesting the same has paid to the
Warrant Agent the amount of transfer taxes or charges incident thereto,
if any. The Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and
delivery of any Warrant Certificate in a name other than that of the
then Registered Holder of the Warrant being exercised.
(d) The Warrant Agent is hereby irrevocably authorized to
requisition the Company's Transfer Agent from time to time for
certificates representing shares of Common Stock required upon exercise
of the Warrants, and the Company will authorize the Transfer Agent to
comply with all proper requisitions. The Company will file with the
Warrant Agent from time to time a statement setting forth the name and
address of the Transfer Agent of the Company for shares of Common Stock
issuable upon the exercise of the Warrants.
SECTION 6. EXCHANGE AND REGISTRATION OF TRANSFER.
(a) Warrant Certificates may be exchanged for other Warrant
Certificates representing an equal aggregate number of Warrants of the
same class or may be transferred in whole or in part. Warrant
Certificates to be exchanged shall be surrendered to the Warrant Agent
at its Corporate Office, and upon satisfaction of the terms and
provision hereof, the Company shall execute and the Warrant Agent shall
countersign, issue, and deliver in exchange therefor the Warrant
Certificates which the Registered Holder making the exchange shall be
entitled to receive.
(b) Upon due presentment for registration of transfer of any
Warrant Certificate at such office, the Company shall execute and the
Warrant Agent shall countersign and
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deliver to the transferee or transferees a new Warrant Certificate or
Certificates representing an equal aggregate number of Warrants.
(c) With respect to all Warrant Certificates presented for
registration of transfer, the Form of Assignment attached thereto shall
be duly endorsed, or be accompanied by a written instrument or
instruments of transfer, in form satisfactory to the Company and the
Warrant Agent, duly executed by the Registered Holder or his
attorney-in-fact duly authorized in writing.
(d) A service charge may be imposed by the Warrant Agent for
any exchange or registration of transfer of Warrant Certificates. In
addition, the Company may require payment by the Registered Holder of a
sum sufficient to cover any tax or other governmental charge that may
be imposed in connection therewith.
(e) All Warrant Certificates surrendered for exercise or for
exchange in case of mutilated Warrant Certificates shall be promptly
canceled by the Warrant Agent and thereafter retained by the Warrant
Agent until termination of this Agreement or may be disposed of or
destroyed at the direction of the Company. The Warrant Agent will
record all such exercises or exchanges on the Warrant Register.
(f) Prior to due presentment for registration of transfer
thereof, the Company and the Warrant Agent may deem and treat the
Registered Holder of any Warrant Certificate as the absolute owner
thereof and of each Warrant represented thereby (notwithstanding any
contrary notations of ownership or other writing thereon) for all
purposes and shall not be affected by any notice to the contrary.
SECTION 7. LOSS OR MUTILATION. Upon receipt by the Company and the
Warrant Agent of evidence satisfactory to them of the ownership of and loss,
theft, destruction, or mutilation of any Warrant Certificate and (in case of
loss, theft, or destruction) of indemnity satisfactory to them, and (in case of
mutilation) upon surrender and cancellation thereof, the Company shall execute
and the Warrant Agent shall (in the absence of notice to the Company and/or the
Warrant Agent that the Warrant Certificate has been acquired by a bona fide
purchaser) countersign and deliver to the Registered Holder in lieu thereof a
new Warrant Certificate of like tenor representing an equal aggregate number of
the Warrants. Applicants for substitute Warrant Certificates shall comply with
such other reasonable regulations and pay such other reasonable charges as the
Warrant Agent may prescribe.
SECTION 8. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF COMMON STOCK OR
WARRANTS. The Stock Purchase Price and the number of shares purchasable upon the
exercise of the Warrants shall be subject to adjustment from time to time upon
the occurrence of certain events described in this Section 8.
8.1 SUBDIVISION OR COMBINATION OF COMMON STOCK. In case the
Company shall at any time (a) subdivide its outstanding shares of Common Stock
into a greater number of shares, (b) combine its outstanding Common Stock into a
smaller number of shares, or (c) issue any securities in reclassification of its
outstanding Common Stock (except as provided in
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Section 8.5 hereof), then and in each such event, the Stock Purchase Price in
effect immediately prior to such action by the Company shall be adjusted by
multiplying it by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to such subdivision,
combination, or reclassification and the denominator of which shall be the
number of shares of Common Stock outstanding immediately after such subdivision,
combination, or reclassification, and the number of shares of Common Stock
issuable upon exercise of the Warrants shall be increased or decreased
proportionately.
8.2 STOCK DIVIDED. In case the Company shall at any time
declare a dividend upon its Common Stock payable solely in shares of Common
Stock, the Stock Purchase Price in effect immediately prior to such dividend
shall be proportionately reduced and the number of shares of Common Stock
issuable upon exercise of the Warrants shall be proportionately increased.
8.3 NOTICE OF ADJUSTMENT. Upon any adjustment of the Stock
Purchase Price or any increase or decrease in the number of shares purchasable
upon the exercise of the Warrants, the Company shall give written notice
thereof, by first class mail, postage prepaid, addressed to the Warrant Agent
and to each Registered Holder of the Warrants at the address of such holder as
shown on the Warrant Register. The notice shall be signed by the Company's
principal financial or accounting officer and shall state the Stock Purchase
Price resulting from such adjustment and the increase or decrease, if any, in
the number of shares purchasable at such price upon the exercise of the
Warrants, setting forth in reasonable detail the method of calculation and the
facts upon which such calculation is based.
8.4 OTHER NOTICES. If at any time:
(a) the Company shall declare any cash dividend upon
its Common Stock;
(b) the Company shall declare any dividend upon its
Common Stock payable in stock (other than a dividend payable solely in
shares of Common Stock) or make any special dividend or other
distribution to the holders of its Common Stock;
(c) there shall be any consolidation or merger of the
Company with another corporation, or a sale of all or substantially all
of the Company's assets to another corporation; or
(d) there shall be a voluntary or involuntary
dissolution, liquidation or winding-up of the Company; then, in any one
or more of said cases, the Company shall give, by certified or
registered mail, postage prepaid, addressed to the Registered Holder of
each Warrant at the address of such Registered Holder as shown on the
Warrant Register, at least 30 days' prior written notice on the date on
which the books of the Company shall close or a record shall be taken
for such dividend or for determining rights to vote in respect of any
such consolidation, merger, sale, dissolution, liquidation, or winding
up or, if no such vote is required, of the date of such consolidation,
merger, sale, dissolution, liquidation, or winding-up. Any such notice
shall also specify, in the case of any such dividend or distribution,
the date on which the holders of Common Stock shall be entitled thereto
and, in the case of any such consolidation, merger, sale, dissolution,
liquidation, or winding-up,
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the date on which the holders of Common Stock shall be entitled to
exchange their Common Stock for securities or other property
deliverable upon such consolidation, merger, sale, dissolution,
liquidation, or winding-up, as the case may be. In the event that the
Registered Holder of a Warrant does not exercise the Warrant prior to
the occurrence of an event described above, except as provided in
Section 8.5 below, the Registered Holder shall not be entitled to
receive the benefits accruing to existing holders of the Common Stock
in such event, and, upon the occurrence of an event described in
subsection (d) hereof, the Warrant shall terminate.
8.5 CHANGES IN COMMON STOCK. In case at any time the Company
shall be party to any transaction (including, without limitation, a merger,
consolidation, sale of all or substantially all of the Company's assets or
recapitalization of the Common Stock) in which the previously outstanding Common
Stock shall be changed into or exchanged for different securities of the Company
or common stock or other securities of another corporation or interests in a
non-corporate entity or other property (including cash) or any combination of
any of the foregoing (each such transaction being herein called a "Transaction"
and the effective date of the Transaction being herein called the "Consummation
Date"), the Company shall make, as a condition of the consummation of the
Transaction, lawful and adequate provisions so that each Registered Holder, upon
the exercise of its Warrants at any time on or after the Consummation Date,
shall be entitled to receive, and the Warrant shall thereafter represent the
right to receive, in lieu of the Common Stock issuable upon such exercise prior
to the Consummation Date, the highest amount of securities or other property to
which such holder would actually have been entitled as a stockholder upon the
consummation of the Transaction if such Register Holder had exercised its
Warrants immediately prior thereto (subject to adjustments from and after the
Consummation Date as nearly equivalent as possible to the adjustments provided
for in this paragraph 8). The provisions of this Section 8.5 shall similarly
apply to successive Transactions.
SECTION 9. FRACTIONAL WARRANTS AND FRACTIONAL SHARES. No
fractional shares shall be issued upon the exercise of the Warrants. The Company
shall, in lieu of issuing any fractional shares, pay the holder entitled to such
fraction a sum equal to such fraction multiplied by the Market Value. No
fractional Warrants shall be issued.
SECTION 10. WARRANT HOLDERS NOT DEEMED STOCKHOLDERS. No holder of a
Warrant shall, as such, be entitled to vote or to consent or to receive notice
as a stockholder in respect of meetings of stockholders for the election of
directors of the Company or any other matters or any rights whatsoever as a
stockholder of the Company. Except for any required adjustment to the Stock
Purchase Price pursuant to Section 8 hereof, no dividends or interest shall be
payable or accrued in respect of a Warrant or the interest represented thereby
or the shares purchasable thereunder until, and only to the extent that, the
Warrant shall have been exercised. No provisions hereof, in the absence of
affirmative action by the holder to purchase shares of Common Stock, and no mere
enumeration herein of the rights or privileges of the Registered Holder of the
Warrant, shall give rise to any liability of such Registered Holder for the
Stock Purchase Price or as a stockholder of the Company whether such liability
is asserted by the Company or by its creditors.
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SECTION 11. RIGHTS OF ACTION. All rights of action with respect to this
Agreement are vested in the respective Registered Holders of the Warrants, and
any Registered Holder of a Warrant, without consent of the Warrant Agent or of
the holder of any other Warrant, may, in his own behalf and for his own benefit,
enforce against the Company his right to exercise his Warrants for the purchase
of Common Stock in the manner provided in the Warrant Certificate and this
Agreement.
SECTION 12. AGREEMENT OF WARRANT HOLDERS. Every holder of a
Warrant, by his acceptance thereof, consents and agrees with the Company, the
Warrant Agent, and every other holder of a Warrant that:
(a) The Warrants are transferable only on the Warrant Register
by the Registered Holder thereof in person or by his attorney duly
authorized in writing and only if the Warrant Certificates representing
such Warrants are surrendered at the office of the Warrant Agent, duly
endorsed or accompanied by a proper instrument of transfer satisfactory
to the Warrant Agent and the Company in their sole discretion, together
with payment of any applicable transfer taxes; and
(b) The Company and the Warrant Agent may deem and treat the
person in whose name the Warrant Certificate is registered as the
holder and as the absolute, true and lawful owner of the Warrants
represented thereby for all purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice or knowledge to the
contrary, except as otherwise expressly provided in Section 7 hereof.
SECTION 13. CANCELLATION. If the Company shall purchase or acquire any
Warrants, the Warrant Certificate(s) evidencing the same shall thereupon be
delivered to the Warrant Agent and canceled by it and retired. The Warrant Agent
shall also cancel the Warrant Certificate(s) following exercise of any or all of
the Warrants represented thereby or delivered to it for transfer, split-up,
combination, or exchange.
SECTION 14. CONCERNING THE WARRANT AGENT. The Warrant Agent acts
hereunder as agent and in a ministerial capacity for the Company, and its duties
shall be determined solely by the provisions hereof. The Warrant Agent shall
not, by issuing and delivering Warrant Certificates or by any other act
hereunder be deemed to make any representations as to the validity, value, or
authorization of the Warrant Certificates or the Warrants represented thereby or
of any securities or other property delivered upon exercise of any Warrant or
whether any stock issued upon exercise of any Warrant is fully paid and
nonassessable.
The Warrant Agent shall not at any time be under any duty or
responsibility to any holder of Warrant Certificates to make or cause to be made
any adjustment of the Stock Purchase Price provided in this Agreement, or to
determine whether any fact exists which may require any such adjustment, or with
respect to the nature or extent of any such adjustment, when made, or with
respect to the method employed in making the same. It shall not (i) be liable
for any recital or statement of facts contained herein or for any action taken,
suffered, or omitted by it in reliance on any Warrant Certificate or other
document or instrument believed by it in good faith to be genuine and to have
been signed or presented by the proper party or parties, (ii) be responsible for
any failure
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on the part of the Company to comply with any of its covenants and obligations
contained in this Agreement or in any Warrant Certificate, or (iii) be liable
for any act or omission in connection with this Agreement except for its own
negligence or wilful misconduct.
The Warrant Agent may at any time consult with counsel satisfactory to
it (who may be counsel for the Company) and shall incur no liability or
responsibility for any action taken, suffered, or omitted by it in good faith in
accordance with the opinion or advice of such counsel.
Any notice, statement, instruction, request, direction, order, or
demand of the Company shall be sufficiently evidenced by an instrument signed by
any of its President, any Vice- President, Treasurer or its Secretary (unless
other evidence in respect thereof is herein specifically prescribed). The
Warrant Agent shall not be liable for any action taken, suffered, or omitted by
it in accordance with such notice, statement, instruction, request, direction,
order, or demand reasonably believed by it to be genuine.
The Company agrees to pay the Warrant Agent reasonable compensation for
its services hereunder and to reimburse it for its reasonable expenses
hereunder; it further agrees to indemnify the Warrant Agent and save it harmless
against any and all losses, expenses, and liabilities, including judgments, and
reasonable costs and counsel fees for anything done or omitted by the Warrant
Agent in the execution of its duties and powers hereunder except losses,
expenses, and liabilities arising as a result of the Warrant Agent's negligence
or wilful misconduct.
The Warrant Agent may resign its duties and be discharged from all
further duties and liabilities hereunder (except liabilities arising as a result
of the Warrant Agent's own negligence or wilful misconduct), after 30 days'
prior written notice to the Company. At least 15 days prior to the date such
resignation is to become effective, the Warrant Agent shall cause a copy of such
notice of resignation to be mailed to the Registered Holder of each Warrant
Certificate at the Company's expense. Upon such resignation, or any inability of
the Warrant Agent to act as such hereunder, the Company shall appoint a new
warrant agent in writing. If the Company shall fail to make such appointment
within a period of 15 days after it has been notified in writing of such
resignation by the resigning Warrant Agent, the Registered Holders of any
Warrant Certificate may apply to any court of competent jurisdiction for the
appointment of a new warrant agent. Any new warrant agent, whether appointed by
the Company or by such a court, shall be a bank or trust company having a
capital and surplus, as shown by its last published report to its stockholders,
of not less than $10,000,000 or a stock transfer company. After acceptance in
writing of such appointment by the new warrant agent is received by the Company,
such new warrant agent shall be vested with the same powers, rights, duties, and
responsibilities as if it had been originally named herein as the Warrant Agent,
without any further assurance, conveyance, act, or deed; but if for any reason
it shall be necessary or expedient to execute and deliver any further assurance,
conveyance, act, or deed, the same shall be done at the expense of the Company
and shall be legally and validly executed and delivered by the resigning Warrant
Agent. Not later than the effective date of any such appointment the Company
shall file notice thereof with the resigning Warrant Agent and shall forthwith
cause a copy of such notice to be mailed to the Registered Holder of each
Warrant Certificate.
Any corporation into which the Warrant Agent or any new warrant agent
may be converted or merged or any corporation resulting from any consolidation
to which the Warrant Agent or any
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new warrant agent shall be a party or any corporation succeeding to the trust
business of the Warrant Agent shall be a successor warrant agent under this
Agreement without any further act; provided that such corporation is eligible
for appointment as successor to the Warrant Agent under the provisions of the
preceding paragraph. Any such successor warrant agent shall promptly cause
notice of its succession as warrant agent to be mailed to the Company and to the
Registered Holder of each Warrant Certificate at the Company's expense.
The Warrant Agent, its subsidiaries and affiliates, and any of its or
their officers or directors, may buy and hold or sell Warrants or other
securities of the Company and otherwise deal with the Company in the same manner
and to the same extent and with like effects as though it were not the Warrant
Agent. Nothing herein shall preclude the Warrant Agent from acting in any other
capacity for the Company or for any other legal entity.
SECTION 15. MODIFICATION OF AGREEMENT. The Warrant Agent and the
Company may by supplemental agreement make any changes or corrections in this
Agreement: (i) that they shall deem appropriate to cure any ambiguity or to
correct any defective or inconsistent provision or manifest mistake or error
herein contained; or (ii) that they may deem necessary or desirable and which
shall not adversely affect the interests of the holders of Warrant Certificates;
provided, however, that, except as provided in subclause (i) or (ii) above, this
Agreement shall not otherwise be modified, supplemented, or altered in any
respect except with the consent in writing of the Registered Holders of Warrant
Certificates representing not less than 50% of the Warrants then outstanding;
and provided, further, that no change in the number or nature of the securities
purchasable upon the exercise of any Warrant, of the Stock Purchase Price
therefor, or the acceleration of the Warrant Expiration Date shall be made
without the consent in writing of the Register Holder of the Warrant Certificate
representing such Warrant, other than such changes as are specifically
prescribed by this Agreement as originally executed or are made in compliance
with applicable law.
SECTION 16. NOTICES. All notices, requests, consents, and other
communications hereunder shall be in writing and shall be deemed to have been
made when delivered or mailed first class registered or certified mail, postage
prepaid as follows: if to the Registered Holder of a Warrant Certificate, at the
address of such Registered Holder as shown in the Warrant Register maintained by
the Warrant Agent; if to the Company, at 0000 X. 00xx Xxxxxx, Xxxxxxx, Xxxxxxx
00000, Attention: President, or at such other address as may have been furnished
to the Warrant Agent in writing by the Company; and if to the Warrant Agent, at
its Corporate Office.
SECTION 17. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Arizona, without reference
to principles of conflict of laws.
SECTION 18. BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the Company and the Warrant Agent and their respective
successors and assigns, and the holders from time to time of Warrant
Certificates. Nothing in this Agreement is intended or shall be construed to
convey upon any other person any right, remedy, or claim, in equity or at law,
or to impose upon any other person any duty, liability, or obligation.
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SECTION 19. TERMINATION. This Agreement shall terminate at the close of
business on the Warrant Expiration Date, except that the Warrant Agent shall
account to the Company for cash held by it and the provisions of Section 14
hereof shall survive such termination.
SECTION 20. COUNTERPARTS. This Agreement may be executed in several
counterparts, which taken together shall constitute a single document.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
CRAGAR INDUSTRIES, INC.
By:______________________
_________________________
By:______________________
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EXHIBIT A
CRAGAR INDUSTRIES, INC.
______________________ WARRANTS
THIS CERTIFIES THAT, for value received, ____________________________,
or registered assigns, is the owner of the number of Warrants set forth above,
each of which entitles the owner thereof to purchase at any time on or before
_________________________ one fully paid and nonassessable share of the Common
Stock, $0.01 par value (the "Common Stock") of Cragar Industries, Inc., a
Delaware corporation (the "Company"), at the purchase price of $7.20 per share
(the "Exercise Price") upon presentation and surrender of this Warrant
Certificate with the attached Form of Election to Purchase duly executed. As
provided in the Warrant Agreement referred to below, the Exercise Price and the
number or kind of shares which may be purchased upon the exercise of the
Warrants evidenced by this Warrant Certificate are, upon the happening of
certain events, subject to adjustment.
This Warrant Certificate is subject to, and entitled to the benefits
of, all of the terms, provisions and conditions of an agreement dated as of
______________________, 199___ (the "Warrant Agreement") between the Company and
ChaseMellon Shareholder Services, L.L.C., as Warrant Agent, which Warrant
Agreement is hereby incorporated herein by reference and made a part hereof and
to which Warrant Agreement reference is hereby made for a full description of
the rights, limitations, obligations, duties and immunities hereunder of the
Company, the Warrant Agent, and the holders of the Warrant Certificates. Copies
of the Warrant Agreement are on file at the principal office of the Company.
This Warrant Certificate, with or without other Warrant Certificates,
upon surrender at the principal office of the Company, may be exchanged for
another Warrant Certificate or Warrant Certificates of like tenor and date
evidencing warrants entitling the holder to purchase a like aggregate number of
shares of Common Stock as the Warrants evidenced by the Warrant Certificate or
Warrant Certificates surrendered entitled such holder to purchase. If this
Warrant Certificate shall be exercised in part, the holder hereof shall be
entitled to receive, upon surrender hereof, another Warrant Certificate or
Warrant Certificates for the number of whole Warrants not exercised.
Fractional shares of Common Stock will not be issued upon the exercise
of any Warrant or Warrants evidenced hereby, and in lieu thereof a cash payment
will be made by the Company, as provided in the Warrant Agreement.
No holder of this Warrant Certificate shall be entitled to vote or
receive dividends or be deemed the holder of Common Stock or any other
securities of the Company which may at any time be issuable on the exercise
hereof for any purpose, nor shall anything contained in the Warrant Agreement or
herein be construed to confer upon the holder hereof, as such, any of the rights
of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action (whether upon any
recapitalization, issue of stock, reclassification of stock, change of par value
or change of stock to no par value, consolidation, merger, sale of assets, or
otherwise) or, except as provided in the Warrant Agreement, to receive notice of
meetings, or to receive dividends or subscription rights or otherwise, until the
Warrant or Warrants evidenced by this Warrant
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Certificate shall have been exercised and the Common Stock purchasable upon the
exercise thereof shall have become deliverable as provided in the Warrant
Agreement.
If this Warrant shall be surrendered for exercise within any period
during which the transfer books for the Common Stock or other class of stock
purchasable upon the exercise of this Warrant are closed for any purpose, the
Company shall not be required to make delivery of certificates for shares
purchasable upon such exercise until the date of the reopening of such transfer
books.
IN WITNESS WHEREOF, Cragar Industries, Inc. has caused the signature of
its President and Secretary to be printed hereon.
Cragar Industries, Inc.
Attest:
_____________________________ By:_____________________________
Secretary President
The Warrant shall not be valid unless countersigned by the Warrant
Agent below.
ChaseMellon Shareholder
Services, Inc.,
as Warrant Agent
By:_____________________________
Authorized Officer
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FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Warrants represented by the Warrant Certificate.)
TO Cragar Industries, Inc.
The undersigned hereby irrevocably elects to exercise
( ) Warrants represented by this Warrant Certificate to purchase the shares
of Common Stock issuable upon the exercise of such Warrants and requests that
certificates for such shares be issued in the name of:
(Please print name and address)
Please insert social security or other identifying number:
If such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, a new Warrant Certificate for the balance remaining of such
Warrants shall be registered in the name of and delivered to:
(Please print name and address)
Please insert social security or other identifying number:
Dated: ____________________________, 19___
Signature:
(Signature must conform in all respects to name of
holder as specified on the face of this Warrant
Certificate)
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FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires a
transfer of Warrants represented by the Warrant Certificates.)
FOR VALUE RECEIVED _______________________________ hereby sells, assigns and
transfers unto ____________________________ this Warrant Certificate, together
with all right, title and interest therein, and does hereby irrevocably
constitute and appoint _______________________, as attorney-in-fact to transfer
the within Warrant Certificates on the books of the within-name Company, with
full power of substitution.
Dated: ________________________________, 19____
By:________________________________
NOTICE
The signature on the foregoing Assignment must correspond to the name as written
upon the face of this Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever.
