EXHIBIT 10.1
EXECUTION COPY
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WARRANT AGREEMENT
Between
CHART INDUSTRIES, INC.
and
THE HOLDERS PARTY HERETO
Dated as of September 30, 2002
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS AND ACCOUNTING MATTERS..................................1
SECTION 1.01. Definitions............................................1
SECTION 1.02. Terms Generally........................................7
SECTION 1.03. Accounting Terms and Determinations....................8
ARTICLE II PURCHASE AND SALE OF WARRANTS......................................8
SECTION 2.01. Authorization and Issuance of Warrant Stock and
Warrants..............................................................8
SECTION 2.02. Issuance of Warrants...................................8
SECTION 2.03. Purchase for Initial Holders' Account..................9
SECTION 2.04. Securities Act Compliance..............................9
SECTION 2.05. Listing...............................................10
ARTICLE III REPRESENTATIONS AND WARRANTIES...................................10
SECTION 3.01. Existence; Qualification..............................10
SECTION 3.02. No Breach.............................................10
SECTION 3.03. Corporate Action......................................10
SECTION 3.04. Approvals.............................................11
SECTION 3.05. Investment Company Act................................11
SECTION 3.06. Public Utility Holding Company Act....................11
SECTION 3.07. Capitalization........................................11
SECTION 3.09. Litigation............................................12
SECTION 3.10. Brokers...............................................12
SECTION 3.11. SEC Documents; Financial Statements...................13
ARTICLE IV RESTRICTIONS ON TRANSFERABILITY...................................13
SECTION 4.01. Transfers Generally...................................13
SECTION 4.02. Transfers of Restricted Securities Pursuant to
Registration Statement and Exemptions................................13
SECTION 4.03. Restrictive Legends...................................13
SECTION 4.04. Termination of Restrictions...........................14
SECTION 4.05. Dispositions of Warrants and Warrant Stock............15
SECTION 4.06. Provisions Applicable to Regulated Holders............15
SECTION 4.07. Provisions Applicable to Related Persons..............15
ARTICLE V ADJUSTMENTS OF STOCK UNITS.........................................17
SECTION 5.01. Subdivisions and Combinations.........................17
SECTION 5.02. Issuance of Common Stock..............................18
SECTION 5.03. Issuance of Other Securities, Rights or Obligations...18
SECTION 5.04. Superseding Adjustment................................19
SECTION 5.05. Other Provisions Applicable to Adjustments............20
(i)
SECTION 5.06. Merger, Consolidation or Disposition of Assets........21
SECTION 5.07. Other Action Affecting Common Stock...................21
SECTION 5.08. Exclusions from Adjustment............................21
SECTION 5.09. Notice of Adjustments.................................22
SECTION 5.10. Notice of Certain Corporate Action....................22
ARTICLE VI REGISTRATION RIGHTS...............................................23
SECTION 6.01. Demand and Piggyback Registrations....................23
SECTION 6.02. Hold-Back Agreements; Cutbacks........................25
SECTION 6.03. Registration Procedures...............................27
SECTION 6.04. Registration Expenses.................................30
SECTION 6.05. Indemnification.......................................31
SECTION 6.06. No Other Registration Rights..........................33
ARTICLE VII TAG-ALONG SALE...................................................33
SECTION 7.01. Tag-Along Rights......................................33
SECTION 7.02. Procedures............................................35
SECTION 7.03. Amendment of Article VII..............................35
ARTICLE VIII HOLDERS' RIGHTS.................................................35
SECTION 8.01. Delivery Expenses.....................................36
SECTION 8.02. Taxes.................................................36
SECTION 8.03. Replacement of Instruments............................36
SECTION 8.04. Indemnification.......................................36
SECTION 8.05. Inspection Rights.....................................37
ARTICLE IX OTHER COVENANTS OF THE ISSUER.....................................37
SECTION 9.01. Financial Statements, Etc.............................37
SECTION 9.02. Related Party Transactions............................38
SECTION 9.03. Restrictions on Performance...........................38
SECTION 9.04. Modification of Other Equity Documents................38
SECTION 9.05. Reservation and Authorization of Common Stock.........38
SECTION 9.06. Notice of Expiration Date.............................39
SECTION 9.07. Documentation of Subsequent Warrants..................39
ARTICLE X MISCELLANEOUS......................................................39
SECTION 10.01. Waiver...............................................40
SECTION 10.02. Notices..............................................40
SECTION 10.03. Expenses, Etc........................................40
SECTION 10.04. Amendments, Etc......................................40
SECTION 10.05. Successors and Assigns...............................41
SECTION 10.06. Survival.............................................41
SECTION 10.07. Specific Performance.................................41
SECTION 10.08. Captions.............................................41
SECTION 10.09. Counterparts.........................................41
(ii)
SECTION 10.10. Governing Law........................................41
SECTION 10.11. Severability.........................................41
SECTION 10.12. Entire Agreement.....................................42
SECTION 10.13. Rights of Holders of Warrants........................42
SCHEDULES
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Schedule 2.02 - Allocation of Warrants
Schedule 3.07(a) - Existing Convertible Securities and Options
Schedule 3.07(b) - Existing Registration Rights
ANNEXES
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Annex 1 - Form of Warrant
Annex 2 - Form of Assignment
Annex 3 - Form of Joinder Agreement
(iii)
WARRANT AGREEMENT dated as of September 30, 2002 between CHART
INDUSTRIES, INC., a company duly organized and validly existing under the laws
of the State of Delaware (the "Issuer"), and each Person named under the caption
"INITIAL HOLDERS" on the signature pages hereof (each an "Initial Holder" and,
collectively, the "Initial Holders").
WHEREAS, the Issuer, certain of its subsidiaries and the
Initial Holders (or their respective affiliates) are parties to a Credit
Agreement dated as of April 12, 1999 (as amended and in effect, the "Credit
Agreement"; references to the Credit Agreement herein shall apply whether or not
the Credit Agreement is then in force and without regard to amendments thereto
unless such amendments thereto have been consented to by the Required Holders),
providing, subject to the terms and conditions thereof, for the extension of
credit by the Initial Holders (or such affiliates) to the Issuer.
WHEREAS, pursuant to the requirements of Section 6.12 of the
Credit Agreement and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Issuer has agreed to issue one
or more Warrants (as hereinafter defined) to each Initial Holder providing for
the purchase of shares of Common Stock (as hereinafter defined), in the manner
hereinafter provided.
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING MATTERS
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SECTION 1.01. Definitions. As used in this Agreement, the
following terms shall have the following meanings:
"Affiliate" means, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.
"Board" means the Board of Directors of the Issuer.
"Business Day" means any day that is not a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or required
by law to remain close.
"Commission" means the Securities and Exchange Commission or
any other similar or successor agency of the federal government administering
the Securities Act and/or the Exchange Act.
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"Common Stock" means the Issuer's Common Stock, par value $.01
per share, as constituted on the Issuance Date and any stock into which such
Common Stock may thereafter be converted or changed, and also shall include any
other stock of the Issuer of any other class, which is not preferred as to
dividends or assets over any other class of any other stock of the Issuer.
References herein and in the Warrants to the Common Stock outstanding "on a
fully diluted basis" at any time means the number of shares of Common Stock then
issued and outstanding, assuming full conversion, exercise and exchange of all
Convertible Securities and "in the money" Options (as of the relevant date of
determination) that are exchangeable for, or exercisable or convertible into,
Common Stock, including the Warrants. All references to Common Stock herein
shall be subject to appropriate adjustment by reason of any stock dividend,
split, reverse split, combination, recapitalization or any similar corporate
transaction.
"Control" means the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "Controlling" and "Controlled" shall have meanings correlative
thereto.
"Convertible Securities" means evidences of indebtedness,
interests or other securities or rights which are exchangeable for or
exercisable or convertible into shares of Common Stock either immediately or
upon the arrival of a specified date or the occurrence of a specified event, but
shall not include Options.
"Credit Agreement" has the meaning specified in the recital of
this Agreement.
"Current Market Value" means, on any date, (i) the average of
the daily market prices for each day during the 10 consecutive trading days
ending on the last trading day prior to such date or (ii) if the applicable
securities are not publicly traded or are not registered under the Exchange Act,
the fair value of such securities as reasonably determined in good faith by the
Board. The market price for each such Business Day shall be the last sale price
on such day as reported in the Consolidated Transaction Reporting System or as
reported for such day by The Wall Street Journal, as applicable, or if such last
sale price is not available, the average of the closing bid and asked prices as
reported in either such system, or in any other case in which such price is not
available, the average of the closing bid and asked prices quoted for such day
as reported by The Wall Street Journal and the National Quotation Bureau pink
sheets.
"Current Warrant Price" means, as at any date, the amount per
share of Common Stock equal to the quotient resulting from dividing the Exercise
Price per Stock Unit in effect on such date by the number of shares (including
any fractional share) of Common Stock comprising a Stock Unit on such date.
"Demand Notice" has the meaning specified in Section 6.01(a).
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"Demand Registration" has the meaning specified in Section
6.01(a).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any similar federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.
"Exercise Price" has the meaning specified in the form of the
Warrant attached as Annex 1.
"Expiration Date" has the meaning specified in the form of the
Warrant attached as Annex 1.
"Financial Statements" has the meaning specified in Section
3.11.
"GAAP" means generally accepted accounting principles,
consistently applied throughout the specified period.
"Governmental Authority" means the government of the United
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, instrumentality, regulatory
body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory, monetary or administrative powers or functions of
or pertaining to government.
"Holder" means any Person (including, without limitation, each
Initial Holder) who acquires Warrants or Warrant Stock pursuant to the
provisions of this Agreement, including any transferees of Warrants or Warrant
Stock, and any successor thereto; provided that a holder of Warrants or Warrant
Stock purchased pursuant to an effective registration statement, pursuant to
Rule 144 or pursuant to any other sale of securities in a public trading market
shall not be deemed a Holder. No Person shall be a Holder unless a Warrant has
been effectively assigned to such Person.
"Immediate Family" means, with respect to any Person who is a
natural person, such Person's children, siblings and parents, but only if such
child, sibling or parent lives in such Person's home.
"Indemnified Party" has the meaning specified in Section
6.05(c).
"Indemnifying Party" has the meaning specified in Section
6.05(c).
"Initial Holder" has the meaning specified in the preamble of
this Agreement.
"Issuance Date" means September 30, 2002.
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"Issuer" has the meaning specified in the preamble of this
Agreement.
"Joinder Agreement" has the meaning specified in Section
7.01(c).
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset. For purposes of this Agreement, a Person shall be deemed to own subject
to a Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.
"Loans" has the meaning assigned to such term in the Credit
Agreement.
"Losses" has the meaning specified in Section 6.05(a).
"NASD" means the National Association of Securities Dealers.
"Notes" means the promissory notes of the Issuer issued
pursuant to the Credit Agreement.
"NYSE" means the New York Stock Exchange.
"Option" means any warrant, option or other right to subscribe
for or purchase shares of Common Stock.
"Option Plans" means any stock option plan, stock grant plan,
restricted stock plan, stock bonus plan, stock purchase, stock option or
employment arrangement or any other equity compensation arrangement approved
from time to time by the Board.
"Other Equity Documents" means the certificate of
incorporation of the Issuer, the by-laws of the Issuer and any other instrument
or document of organization or governance of the Issuer.
"Other Holder" means any Person who acquires Other Warrants or
Other Warrant Stock, including any transferees of Other Warrants or Other
Warrant Stock; provided that a holder of Other Warrants or Other Warrant Stock
purchased pursuant to an effective registration statement, pursuant to Rule 144
or pursuant to any other sale of securities in a public trading market shall not
be deemed an Other Holder.
"Other Warrant" and "Other Warrants" means (i) the warrants to
purchase Common Stock issued pursuant to the Warrant Agreement dated as of June
28, 2002 between the Issuer and the holders party thereto and (ii) the warrants
to purchase Common Stock, if any, issued by the Issuer after the date hereof in
accordance with Section 6.12 of the Credit Agreement and pursuant to the
documentation contemplated by Section 9.07.
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"Other Warrant Stock" means all shares of Common Stock
issuable from time to time upon exercise of the Other Warrants.
"Person" means any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.
"Piggyback Notice" has the meaning specified in Section
6.01(a).
"Piggyback Registration" has the meaning specified in Section
6.01(a).
"Principal Shareholder" means, at any time, any Shareholder
which either alone or together with its Related Parties owns 20% or more of the
Common Stock on a fully diluted basis.
"Registration Expenses" has the meaning specified in Section
6.04.
"Related Parties" means (a) with respect to any Person who is
a natural person, (i) such Person's spouse, any member of such Person's
Immediate Family and any trust or similar arrangement for the benefit of such
Person, such Person's spouse or any member of such Person's Immediate Family and
(ii) any other Person (other than the Issuer or any of its Subsidiaries or any
Person organized for charitable purposes) that is not a natural person and of
which such Person owns or controls at least 20% of the voting equity interests,
and (b) with respect to any Person who is not a natural person, any Subsidiary
or Affiliate of such Person (other than the Issuer or any of its Subsidiaries or
any Person organized for charitable purposes); provided that "Related Parties"
shall not include any employee benefit plan.
"Related Person" has the meaning specified in Section 4.07.
"Required Holders" means the holders of a majority of the sum
of (a) Warrant Stock issued or issuable upon exercise of the Warrants and held
by the Holders and (b) Other Warrant Stock issued or issuable upon exercise of
the Other Warrants and held by Other Holders. For purposes of giving notices,
waivers and consents hereunder, holders of Warrants shall be deemed holders of
the Warrant Stock issued on exercise thereof and holders of Other Warrants shall
be deemed holders of the Other Warrant Stock issued on exercise thereof.
"Restricted Certificate" means a certificate for Warrant Stock
or Warrants bearing or required to bear the restrictive legend set forth in
Section 4.03.
"Restricted Securities" means Restricted Warrant Stock and
Restricted Warrants.
"Restricted Warrants" means Warrants evidenced by a Restricted
Certificate.
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"Restricted Warrant Stock" means Warrant Stock evidenced by a
Restricted Certificate.
"Revolving Credit Loan" has the meaning assigned to such term
in the Credit Agreement.
"Rights Agreement" means the Rights Agreement, dated as of May
1, 1998, as amended, between the Issuer and National City Bank, as rights agent.
"Rule 144" means Rule 144 promulgated by the Commission under
the Securities Act (or any successor or similar rule then in force).
"Rule 144A" means Rule 144A promulgated by the Commission
under the Securities Act (or any successor or similar rule then in force).
"SEC Documents" has the meaning specified in Section 3.11.
"Securities" means the Common Stock and any other equity
securities of the Issuer of any kind or class.
"Securities Act" means the Securities Act of 1933, as amended,
or any similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Seller" has the meaning specified in Section 6.01(a).
"Seller Notice" has the meaning specified in Section 6.01(a).
"Shareholder" means any Person who directly or indirectly owns
any shares of Common Stock (including Warrant Stock issued upon exercise of a
Warrant).
"Stock Unit" means one share of Common Stock, as such Common
Stock is constituted on the date hereof, and thereafter means such number of
shares (including any fractional shares) of Common Stock and other securities,
cash or other property as shall result from the adjustments specified in Article
V.
"Subsidiary" means, with respect to any Person (the "parent")
at any date, any corporation, limited liability company, partnership,
association or other entity the accounts of which would be consolidated with
those of the parent in the parent's consolidated financial statements if such
financial statements were prepared in accordance with GAAP as of such date, as
well as any other corporation, limited liability company, partnership,
association or other entity (a) of which securities or other ownership interests
representing more than
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50% of the equity or more than 50% of the ordinary voting
power or, in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, controlled or held, or (b) that is, as of
such date, otherwise Controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent.
"Tag-Along Participation Notice" has the meaning specified in
Section 7.02.
"Tag-Along Sale" has the meaning specified in Section 7.01(a).
"Tag-Along Sale Notice" has the meaning specified in Section
7.02.
"Tag-Along Seller" has the meaning specified in Section
7.01(a).
"Term Loans" has the meaning assigned to such term in the
Credit Agreement.
"underwritten registration" or "underwritten offering" means a
registration in which securities of the Issuer are sold to an underwriter for
reoffering to the public.
"Warrant" and "Warrants" means the Warrants issued by the
Issuer pursuant to this Agreement as of September 30, 2002, evidencing rights to
purchase up to an aggregate of 1,353,531 Stock Units (which Warrants (together
with the Other Warrants and Other Warrant Stock issued before the date hereof)
represent, as of September 30, 2002, 7% in the aggregate of the outstanding
shares of Common Stock on a fully diluted basis), and all Warrants issued upon
transfer, division or combination of, or in substitution for, any such Warrants
issued pursuant to this Agreement.
"Warrant Stock" means all shares of Common Stock, as
constituted on the Issuance Date, issuable from time to time upon exercise of
the Warrants.
SECTION 1.02. Terms Generally. The definitions of terms herein
shall apply equally to the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words "include", "includes" and
"including" shall be deemed to be followed by the phrase "without limitation".
The word "will" shall be construed to have the same meaning and effect as the
word "shall". Unless the context requires otherwise (a) any definition of or
reference to any agreement, instrument or other document herein shall be
construed as referring to such agreement, instrument or other document as from
time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein),
(b) any reference herein to any Person (other than a Holder) shall be construed
to include such Person's successors and assigns, (c) the words "herein",
"hereof" and "hereunder", and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits, Annexes and
Schedules shall be construed to refer to Articles and Sections of, and
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Exhibits, Annexes and Schedules to, this Agreement or the Warrant, as the case
may be, and (e) the words "asset" and "property" shall be construed to have the
same meaning and effect and to refer to any and all tangible and intangible
assets and properties, including cash, securities, accounts and contract rights.
SECTION 1.03. Accounting Terms and Determinations. Except as
otherwise may be expressly provided herein, all accounting terms used herein
shall be interpreted, and all financial statements and certificates and reports
as to financial matters required to be delivered to the Holders hereunder shall
be prepared, in accordance with GAAP. All calculations made for the purposes of
determining compliance with the terms of this Agreement shall (except as
otherwise may be expressly provided herein) be made by application of GAAP.
ARTICLE II
PURCHASE AND SALE OF WARRANTS
SECTION 2.01. Authorization and Issuance of Warrant Stock and
Warrants. The Issuer has authorized: (a) the issuance of Warrants evidenced by
warrant certificates in the form of Annex 1; and (b) the issuance of such number
of shares of Common Stock as shall be necessary to permit the Issuer to comply
with its obligations to issue shares of Common Stock pursuant to the Warrants.
SECTION 2.02. Issuance of Warrants. As of September 30,
2002, in satisfaction of the Issuer's obligations under Section 6.12(a)(ii) of
the Credit Agreement:
(a) the Issuer shall issue to each Initial Holder (or its
Affiliate or nominee), for no additional consideration, a Warrant
evidencing the right to purchase such number of Stock Units as is set
forth opposite the name of such Initial Holder (or its Affiliate or
nominee) on Schedule 2.02;
(b) the Issuer shall deliver to each Initial Holder a single
certificate for the Warrants issued pursuant to clause (a) above,
registered in the name of such Initial Holder, except that, if any
Initial Holder shall notify the Issuer in writing prior to such
issuance that it desires certificates for such Warrants to be issued in
other denominations or registered in the name or names of any
Affiliate, nominee or nominees of such Initial Holder (other than a
Related Person), then the certificates for such Warrants shall be
issued to such Initial Holder in the denominations and registered in
the name or names specified in such notice (and each such Affiliate or
nominee shall be deemed a Holder); and
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(c) the Issuer shall deliver to the Initial Holders a legal
opinion from counsel to the Issuer, addressed to the Initial Holders
and in form and substance satisfactory to JPMorgan Chase Bank.
SECTION 2.03. Purchase for Initial Holders' Account. Each
Initial Holder represents and warrants to the Issuer as follows:
(a) Such Initial Holder is acquiring the Warrants and the
Warrant Stock for investment for its own account, without a view to, or
for resale in connection with, any distribution thereof in violation of
the Securities Act or other applicable securities laws, all without
prejudice, however, to the right of such Initial Holder at any time, in
accordance with this Agreement, lawfully to sell or otherwise to
dispose of all or any part of the Warrants or the Warrant Stock held by
it.
(b) Such Initial Holder (i) is an "accredited investor" within
the meaning of Regulation D promulgated under the Securities Act and
(ii) is in a financial position to hold the Warrant to be issued to it
hereunder and the Warrant Stock relating thereto for an indefinite time
and is able to bear the economic risk and withstand a complete loss of
its investment in the Issuer.
(c) All documents, records or books pertaining to this
investment have been made available for inspection by such Initial
Holder, its attorneys and/or its accountants. Such Initial Holder
understands that such Initial Holder and/or its representatives have
had the opportunity to ask questions of, and receive answers from, the
Issuer or one or more persons acting on the Issuer's behalf concerning
the offering of the Warrants and the Warrant Stock and the business of
the Issuer and all such questions have been answered to such Initial
Holder's full satisfaction.
(d) Such Initial Holder is not the "beneficial owner", either
alone or together with its "affiliates" or "associates" (as those terms
are defined in the Exchange Act), of 5% or more of the outstanding
shares of Common Stock as constituted on the Issuance Date.
SECTION 2.04. Securities Act Compliance. Such Initial Holder
understands that the Issuer has not registered the Warrants or the Warrant Stock
under the Securities Act or applicable state securities laws, and such Initial
Holder agrees that neither the Warrants nor the Warrant Stock shall be sold or
transferred or offered for sale or transfer without registration or
qualification under the Securities Act or applicable state securities laws or
the availability of an exemption therefrom, all as more fully provided in
Article IV, and such Initial Holder understands that the Warrants and the
Warrant Stock will bear a legend to such effect and the Issuer will make a
notation on its transfer books to such effect.
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SECTION 2.05. Listing. Prior to the issuance of Warrant Stock
upon the exercise of a Warrant, the Issuer shall use best efforts to secure the
listing of such shares of Warrant Stock upon each of the national securities
exchange or automated quotation system, if any, upon which shares of Common
Stock are then listed (subject to official notice of issuance upon the exercise
of such Warrant) and shall maintain, so long as any other shares of Common Stock
shall be so listed, such listing of all shares of Warrant Stock from time to
time issuable upon the exercise of a Warrant; and the Issuer shall use best
efforts to so list on each national securities exchange or automated quotation
system, and shall maintain such listing of, any other shares of capital stock of
the Issuer issuable upon the exercise of a Warrant if and so long as shares of
the same class shall be so listed on such national securities exchange or
automated system.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
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The Issuer represents and warrants as follows:
SECTION 3.01. Existence; Qualification. The Issuer is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization. The Issuer is duly qualified, licensed or
admitted to do business and is in good standing as a foreign corporation in
every jurisdiction where the failure to be so qualified would have a material
adverse effect on the business, financial condition, operations, assets,
prospects, liabilities or capitalization of the Issuer and has all requisite
corporate power and authority to transact its business as now conducted in all
such jurisdictions.
SECTION 3.02. No Breach. Assuming the truth and accuracy of
the Initial Holders' representation contained in Section 2.03(d), the execution,
delivery and performance of this Agreement and the Warrants by the Issuer and
the consummation by it of the transactions contemplated hereby and thereby will
not (a) violate the certificate of incorporation or by-laws or any other
instrument or document of organization or governance of the Issuer, (b) violate,
or result in a breach of or default under, any other material instrument or
agreement to which the Issuer is a party or is bound, (c) violate any judgment,
order, injunction, decree or award against or binding upon the Issuer, (d)
result in the creation of any material Lien upon any of the properties or assets
of the Issuer, or (e) (assuming the truth and accuracy of the Initial Holders'
representations contained in Sections 2.03 and 2.04) violate any law, rule or
regulation relating to the Issuer.
SECTION 3.03. Corporate Action. Assuming the truth and
accuracy of the Initial Holders' representation contained in Section 2.03(d),
the Issuer has all necessary corporate power and authority to execute, deliver
and perform its obligations under this Agreement and the
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Warrants; the execution, delivery and performance by the Issuer of this
Agreement and the Warrants have been duly authorized by all necessary action
(including all Shareholder action) on the part of the Issuer; this Agreement and
the Warrants being issued on the date hereof have been duly executed and
delivered by the Issuer and constitute the legal, valid and binding obligations
of the Issuer, enforceable against the Issuer in accordance with their
respective terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors rights generally and by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or law); the Warrant Stock covered by the Warrants has been duly and
validly authorized and reserved for issuance and shall, when paid for, issued
and delivered in accordance with the Warrants, be duly and validly issued, fully
paid and nonassessable and free and clear of any Liens (other than those imposed
by applicable securities laws); and none of the Warrant Stock issued pursuant to
the terms hereof will be in violation of any preemptive rights of any
Shareholder.
SECTION 3.04. Approvals. Assuming the truth and accuracy of
the Initial Holders' representation contained in Section 2.03(d), except (a) in
connection with the registration of the Warrant Stock pursuant to Article VI or
(b) for any necessary stock exchange approvals, no authorizations, approvals or
consents of, and no filings or registrations with, any Governmental Authority or
any other Person (except for Persons who are Principal Shareholders or Related
Parties thereof who shall be required to enter into a Joinder Agreement on or
after the date of execution of this Agreement) are necessary for the execution,
delivery or performance by the Issuer of this Agreement or the Warrants or for
the validity or enforceability thereof. Any such action required to be taken as
a condition to the execution and delivery of this Agreement, or the execution,
issuance and delivery of the Warrants, has been duly taken by all such
Governmental Authorities or other Persons, as the case may be.
SECTION 3.05. Investment Company Act. The Issuer is not an
"investment company", or a company "controlled by" an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
SECTION 3.06. Public Utility Holding Company Act. The Issuer
is not a "holding company", or an "affiliate" of a "holding company" or a
"subsidiary company" of a "holding company", within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
SECTION 3.07. Capitalization. (a) As of the date hereof, the
authorized capital stock of the Issuer consists of 60,000,000 shares of Common
Stock, par value $.01 per share, and 1,000,000 shares of Preferred Stock, par
value $.01 per share, of which 25,244,152 shares of Common Stock have been
issued and are outstanding (and 122,348 shares of Common Stock are held in
treasury). Except (i) for the Warrants issued hereunder, (ii) as set forth in
Schedule 3.07(a) and (iii) Section 6.12 of the Credit Agreement, the Issuer does
not have outstanding any Convertible Securities or Options exercisable or
convertible into or exchangeable for any
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interests or other equity rights of the Issuer, nor does it have outstanding any
agreements providing for the issuance of, or any commitments to issue, any
Convertible Securities or Options.
(b) Other than this Agreement, Section 6.12 of the Credit
Agreement, the Warrant Agreement dated as of June 28, 2002 between the Issuer
and the holders party thereto or as set forth in Schedule 3.07(b), there is not
in effect on the date hereof any agreement by the Issuer pursuant to which any
holders of debt or equity securities of the Issuer have a right to cause the
Issuer to register such securities under the Securities Act. None of the
agreements listed on Schedule 3.07(b) contains any provision that conflict or
are inconsistent with the rights granted under Article VI.
(c) Except for this Agreement, there is not in effect on the
date hereof any agreement by the Issuer or any of its Shareholders that (i)
restricts the transferability of the Warrants and/or the Warrant Stock (whether
or not in connection with a transfer of the Loans), (ii) restricts the
transferability of the right of the Holder in this Agreement to any transferee
of all or a portion of the Holder's Warrants and/or Warrant Stock, or (iii)
requires any consent or other approval of any Person to the exercise of the
Warrant by the Holder or the issuance of Warrant Stock upon such exercise.
SECTION 3.08. Private Offering. Assuming the truth and
accuracy of the Initial Holders' representations and warranties contained in
Sections 2.03 and 2.04, the issuance and sale of the Warrants to the Holders
hereunder are exempt from the registration and prospectus delivery requirements
of the Securities Act.
SECTION 3.09. Litigation. (a) There is no action, suit,
proceeding or investigation pending or, to the knowledge of the Issuer,
threatened against the Issuer or any of its Subsidiaries before any Governmental
Authority seeking to enjoin the transactions contemplated by this Agreement or
the Warrants or that involve this Agreement or the transactions contemplated
herein.
(b) Except for the matters disclosed in Schedule IV to the
Credit Agreement or the SEC Documents, there are no actions, suits or
proceedings by or before any arbitrator or Governmental Authority now pending
against or, to the knowledge of the Issuer, threatened against or affecting the
Issuer or any of its Subsidiaries as to which there is a reasonable possibility
of an adverse determination and that, if adversely determined, could reasonably
be expected, individually or in the aggregate, to result in a material adverse
effect on the business, assets, liabilities, operations, material contracts,
prospects or condition, financial or otherwise, of the Issuer and its
Subsidiaries taken as a whole.
SECTION 3.10. Brokers. All negotiations relative to this
Agreement and the transactions contemplated hereby have been carried out by the
Issuer directly with the Initial
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Holders without the intervention of any Person on behalf of the Issuer in such
manner as to give rise to any valid claim by any Person against the Initial
Holders or any other Holder for a finder's fee, brokerage commission or similar
payment.
SECTION 3.11. SEC Documents; Financial Statements. The Issuer
has filed in a timely manner all documents that the Issuer was required to file
since January 1, 2000 with the Commission under Sections 13, 14(a) and 15(d) of
the Exchange Act. As of their respective filing dates, all documents filed by
the Issuer since January 1, 2000 with the Commission (the "SEC Documents")
complied in all material respects with the requirements of the Exchange Act or
the Securities Act, as applicable. None of the SEC Documents as of their
respective dates contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they were
made, not misleading. The financial statements of the Issuer included in the SEC
Documents (the "Financial Statements") comply as to form in all material
respects with applicable accounting requirements and with the published rules
and regulations of the Commission with respect thereto. The Financial Statements
have been prepared in accordance with GAAP and fairly present the consolidated
financial position of the Issuer and its Subsidiaries at the dates thereof and
the consolidated results of their operations and consolidated cash flows for the
periods then ended (subject, in the case of unaudited statements, to the lack of
full footnote disclosure and to normal, recurring adjustments).
ARTICLE IV
RESTRICTIONS ON TRANSFERABILITY
SECTION 4.01. Transfers Generally. The Restricted Securities
shall be transferable only upon the conditions specified in this Article IV and
in Article VI, which conditions are intended to ensure compliance with the
provisions of the Securities Act and applicable state securities laws in respect
of the transfer of any Restricted Securities.
SECTION 4.02. Transfers of Restricted Securities Pursuant to
Registration Statement and Exemptions. The Restricted Securities may be offered
or sold by the Holder thereof pursuant to an effective registration statement
under the Securities Act and applicable state securities laws or a valid
exemption therefrom (including, without limitation, to the extent applicable,
Rule 144 or Rule 144A and applicable exemptions from state securities laws).
SECTION 4.03. Restrictive Legends. Unless and until otherwise
permitted by this Article IV, each certificate for the Warrants issued under
this Agreement, each certificate for any Warrants issued to any subsequent
transferees of any such certificate, each certificate for any Warrant Stock
issued upon exercise of any Warrant and each certificate for any Warrant Stock
issued to any subsequent transferee of any such certificate, shall be stamped or
otherwise imprinted with a legend in substantially the following form:
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"THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE IS SUBJECT TO THE RESTRICTIONS SPECIFIED IN THAT
CERTAIN WARRANT AGREEMENT DATED AS OF SEPTEMBER 30, 2002 (THE
"WARRANT AGREEMENT") BETWEEN CHART INDUSTRIES, INC., A
DELAWARE CORPORATION (THE "ISSUER"), AND THE HOLDERS PARTY
THERETO FROM TIME TO TIME AS MODIFIED AND SUPPLEMENTED AND IN
EFFECT FROM TIME TO TIME, AND NO TRANSFER OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE SHALL BE VALID OR EFFECTIVE
UNTIL SUCH RESTRICTIONS HAVE LAPSED OR BEEN FULFILLED,
RELEASED OR WAIVED. A COPY OF THE FORM OF THE WARRANT
AGREEMENT IS ON FILE AND MAY BE INSPECTED AT THE PRINCIPAL
EXECUTIVE OFFICE OF THE ISSUER. THE HOLDER OF THIS
CERTIFICATE, BY ACCEPTANCE OF THIS CERTIFICATE, AGREES TO BE
BOUND BY THE PROVISIONS OF THE WARRANT AGREEMENT.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS, AND ACCORDINGLY, SUCH
SECURITIES MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED
OF EXCEPT IN COMPLIANCE WITH THE REGISTRATION OR QUALIFICATION
PROVISIONS OF APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR
APPLICABLE EXEMPTIONS THEREFROM."
SECTION 4.04. Termination of Restrictions. All of the
restrictions imposed by this Article IV upon the transferability of the
Restricted Securities shall cease and terminate as to any particular Restricted
Security when such Restricted Security shall have been effectively registered
under the Securities Act and applicable state securities laws and sold by the
Holder thereof in accordance with such registration or sold under and pursuant
to Rule 144 or is eligible to be sold under and pursuant to paragraph (k) of
Rule 144. Whenever the restrictions imposed by this Article IV shall terminate
as to any Restricted Security as hereinabove provided, the Holder thereof shall,
upon written request, be entitled to receive from the Issuer, without expense, a
new certificate evidencing such Restricted Security not bearing the restrictive
legend otherwise required to be borne by a certificate evidencing such
Restricted Security, provided that the Holder thereof shall have furnished the
Issuer with such certificates and opinions as the Issuer shall have reasonably
requested.
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SECTION 4.05. Dispositions of Warrants and Warrant Stock. (a)
Subject to compliance with the Securities Act, applicable state securities laws
and the requirement as to placement of a legend on certificates for Restricted
Securities specified in Section 4.03, any Holder shall have the right to
transfer any or all of its Restricted Securities to any Person. The Person to
which Restricted Securities are transferred pursuant to the immediately
preceding sentence shall be deemed to be a Holder of such Restricted Securities
and bound by the provisions of this Agreement applicable to the Holders so long
as such Person continues to own any of the Restricted Securities so transferred
to it.
(b) In connection with any transfer of any Warrant, the Holder
shall surrender such Warrant to the Issuer, together with a written assignment
of such Warrant duly executed by the Holder hereof or such Holder's agent or
attorney-in-fact. Such written assignment shall be in the form of the Assignment
attached as Annex 2. Upon such surrender and receipt by the Issuer of a written
agreement, in form reasonably satisfactory to the Issuer, of the assignee
agreeing to be bound by this Agreement to the same extent as such Holder was so
bound, the Issuer shall execute and deliver a new Warrant or Warrants in the
name of the assignee and in the denominations specified in such instrument of
assignment, and the original Warrant shall promptly be canceled.
(c) Any Warrant may be exchanged for other Warrants of the
same series upon presentation to the Issuer, together with a written notice
specifying the denominations in which new Warrants are to be issued, signed by
the Holder thereof. The Issuer shall execute and deliver a new Warrant or
Warrants to such Holder in exchange for the Warrant or Warrants to be divided or
combined in accordance with such notice. The Issuer shall pay all expenses and
other charges (including taxes, to the extent required by Section 8.02) payable
in connection with the preparation, issuance, delivery, transfer or exchange of
the Warrants.
(d) The Issuer shall maintain books for the registration and
transfer of the Warrants, and shall allow each Holder of Warrants to inspect
such books at such reasonable times as such Holder shall request.
SECTION 4.06. Provisions Applicable to Regulated Holders. (a)
Notwithstanding anything in this Agreement or the Warrants to the contrary, no
Holder that is subject to the provisions of 12 USC 24 (Seventh) or a similar
provision of state law or any regulation that generally limits the ability of a
bank to own equity interests of another Person, or that is subject to Regulation
Y of the Board of Governors of the Federal Reserve System (or any successor
regulation thereto) ("Regulation Y") or that is affiliated with any entity
subject to the provisions of Regulation Y (if such Affiliate directly or
indirectly holds securities of the Issuer) (any such Holder being referred to
herein as a "Regulated Holder") and no transferee of such Regulated Holder may
exercise the Warrants for a number of shares of Warrant Stock that would permit
such Regulated Holder, together with its Affiliates and transferees, to own or
control a number of shares of Warrant Stock greater than that permitted by
applicable law including
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Regulation Y (and, for purposes of this restriction, a
reasoned opinion of counsel to such Holder and reasonably acceptable to the
Issuer based on facts and circumstances deemed appropriate by such counsel to
the effect that such Holder may lawfully own or control such number of shares
shall be conclusive).
(b) The Issuer shall not, without 15 days' prior written
notice to each Holder, directly or indirectly, purchase, redeem, retire or
otherwise acquire any shares of Common Stock if, as a result of such purchase,
redemption, retirement or other acquisition and after giving effect to the
exercise of all outstanding Warrants, a Holder, together with its Affiliates,
shall own or control, or shall be deemed to own or control, in the aggregate a
greater number of securities of any kind issued by the Issuer than are permitted
under applicable law, including Regulation Y.
(c) In the event of any underwritten public offering of
Restricted Securities in which a Regulated Holder is participating, the Issuer
shall provide reasonable assistance to the underwriter in ensuring that any
Warrants or Warrant Stock sold by such Holder are widely disseminated.
(d) In the event that a Regulated Holder determines that there
is a Regulatory Problem (as defined below), the Issuer agrees to use
commercially reasonable efforts to take all such actions as are within its
control and reasonably required by such Regulated Holder in order (i) to
effectuate and facilitate any transfer by any Regulated Holder (or any of its
Affiliates) of any Warrant or Warrant Stock then held by such Regulated Holder
to any Person designated by such Regulated Holder and (ii) to permit such
Regulated Holder (or any of its Affiliates) to exchange all or a portion of any
voting security then held by it on a share-for-share basis for shares of a
non-voting security of the Issuer, which non-voting security shall convey
equivalent economic benefits to those of such Warrants or Warrant Stock and
include equivalent anti-dilution protection and otherwise shall be identical in
all respects to the voting security exchanged for it, except that it shall be
non-voting and shall be convertible into a voting security on such terms as are
required by such Regulated Holder in light of regulatory considerations then
prevailing. Such actions may include, but shall not necessarily be limited to,
entering into such additional agreements, adopting such amendments to the
certificate of incorporation and bylaws of the Issuer subject to required
Shareholder approvals and taking such additional actions as are reasonably
requested by any Regulated Holder in order to effectuate the intent of the
foregoing. For purposes of this Agreement, a "Regulatory Problem" means any set
of facts or circumstances wherein it has been asserted by any Governmental
Authority (or any Regulated Holder believes that there is a substantial risk of
such assertion) that any Regulated Holder is not entitled to hold, or exercise
any significant right with respect to, any Warrant or Warrant Stock held by it.
Any exchange referred to in clause (ii) above shall occur as soon as reasonably
practicable but in any event within 60 days after written notice by the affected
Regulated Holder to the Issuer (or such earlier date if required to comply with
applicable law so long as such Regulated Holder has provided reasonable prior
notice of such date to the Issuer).
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(e) At the request of the Issuer, at the time of the exercise
of any Warrant by any Holder such Holder shall notify the Issuer in writing as
to (i) whether such Holder is a Regulated Holder and (ii) if such Holder is a
Regulated Holder, the aggregate amount of Common Stock, Convertible Securities
and Options then owned or controlled by such Holder and its Affiliates, provided
that any failure or delay by any Holder in providing such notification shall not
affect in any way the obligations of the Issuer hereunder or with respect to any
Warrant or Warrant Stock.
SECTION 4.07. Provisions Applicable to Related Persons.
Notwithstanding any other provision of this Agreement or a Warrant, no Holder
may exercise a Warrant (or any substitute security issued under Section 4.06(d))
if such Holder is then the "beneficial owner", either alone or together with its
"affiliates" and "associates" (as those terms are defined in the Exchange Act),
of 5% or more of the then outstanding shares of Common Stock as constituted on
the Issuance Date (a "Related Person"), unless (a) such transaction is approved
by the Shareholders in accordance with Article VI of the Issuer's certificate of
incorporation or (b) the Issuer's certificate of incorporation previously has
been amended to remove such Article and its requirements. If reasonably
requested by such Related Person in writing, and subject to applicable fiduciary
duties of the Board, the Issuer will use commercially reasonable efforts to
secure the approval of the Shareholders to such exercise under such Article at
the next regularly scheduled Shareholder meeting of the Issuer, provided that
such Related Person provides all information to the Issuer about such Related
Person and such transaction reasonably required under the Exchange Act to be
included in the Issuer's proxy statement for such meeting and, if required,
consents to the inclusion of such information in such proxy statement.
ARTICLE V
ADJUSTMENTS OF STOCK UNITS
SECTION 5.01. Subdivisions and Combinations. If at any time
the Issuer shall:
(a) pay a dividend or other distribution of Common Stock;
(b) subdivide or reclassify its outstanding shares of Common
Stock into a larger number of shares of Common Stock; or
(c) combine its outstanding shares of Common Stock into a
smaller number of shares of Common Stock;
then immediately after the occurrence of any such event the number of shares of
Warrant Stock comprising a Stock Unit shall be adjusted so as to equal the
number of shares of Warrant Stock which each Holder would have been entitled to
receive with respect to such Stock Unit if such Holder had exercised the Warrant
immediately prior to the occurrence of such event (or, in the case of any such
dividend or distribution, immediately prior to the record date therefor).
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SECTION 5.02. Issuance of Common Stock. In case at any time
the Issuer (i) shall issue or sell shares of Common Stock and (ii) the
consideration per share of Common Stock to be paid upon such issuance or sale is
less than the Current Market Value per share of Common Stock in effect on the
date of such issuance or sale, then the number of shares of Warrant Stock
comprising a Stock Unit shall be adjusted to be that number determined by
multiplying the number of shares of Warrant Stock comprising a Stock Unit
immediately prior to the date of such issuance or sale by a fraction (not to be
less than one) (A) the numerator of which shall be equal to the product of (x)
the number of shares of Common Stock outstanding after giving effect to such
issuance or sale and (y) the Current Market Value per share of Common Stock
determined immediately prior to the date of such issuance or sale and (B) the
denominator of which shall be equal to the sum of (x) the product of (1) the
number of shares of Common Stock outstanding immediately prior to the date of
such issuance or sale and (2) the Current Market Value per share of Common Stock
determined immediately prior to the date of such issuance or sale and (y) the
aggregate consideration to be received by the Issuer for the total number of
shares of Common Stock to be issued or sold. Aggregate consideration for
purposes of the preceding clause (B)(y) shall be determined as follows: in case
any shares of Common Stock shall be issued or sold for cash, the consideration
received therefor shall be deemed to be the amount payable to the Issuer
therefor (without deduction therefrom of any expenses incurred or any
underwriting commissions or concessions or discounts or, in the case of a
private placement thereof, finders' fees or commissions paid or allowed by the
Issuer in connection therewith). In case any shares of Common Stock shall be
issued or sold for a consideration other than cash payable to the Issuer, the
consideration received therefor shall be deemed to be the fair market value
thereof as reasonably determined in good faith by the Board (without deduction
therefrom of any expenses incurred or any underwriting commissions or
concessions or discounts or, in the case of a private placement thereof,
finders' fees or commissions paid or allowed by the Issuer in connection
therewith). In case any shares of Common Stock shall be issued in connection
with any merger of another corporation into the Issuer, the amount of
consideration therefor shall be deemed to be the fair market value of such
portion of the assets of such merged corporation as the Board shall reasonably
determine to be attributable to such shares of Common Stock.
SECTION 5.03. Issuance of Other Securities, Rights or
Obligations. In case at any time the Issuer (i) shall issue or sell options to
purchase or rights to subscribe for Common Stock or securities directly or
indirectly convertible into or exchangeable for Common Stock (or options or
rights with respect to such securities) and (ii) the consideration per share for
which Common Stock is deliverable upon exercise of such options or rights or
conversion or exchange of such securities (determined by dividing (x) the total
amount received or receivable by the Issuer in consideration of such issuance or
sale, plus the aggregate amount of consideration (if any) payable to the Issuer
upon such exercise, conversion or exchange, by (y) the total number of shares of
Common Stock necessary to effect the exercise, conversion or exchange of all
such options, rights or securities) shall be less than the Current Market Value
per share of Common Stock in effect on the date of such issuance or sale, then
the number of shares of Warrant Stock
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comprising a Stock Unit shall be adjusted on the date of such issuance or sale
to be that number determined by multiplying the number of shares of Warrant
Stock comprising a Stock Unit immediately prior to the date of such issuance or
sale by a fraction (not to be less than one) (i) the numerator of which shall
be equal to the product of (A) the total number of shares of Common Stock
outstanding after giving effect to the exercise, conversion or exchange of all
such options, rights or securities to be issued in such transaction and (B) the
Current Market Value per share of Common Stock determined immediately before
such date and (ii) the denominator of which shall be equal to the sum of (A)
the product of (1) the total number of shares of Common Stock outstanding
immediately prior to the date of such issuance or sale and (2) the Current
Market Value per share of the Common Stock determined immediately prior to the
date of such issuance or sale and (B) the aggregate consideration per share
(determined as set forth in subsection (ii)(x) and (y) above) for which Common
Stock is deliverable upon exercise, conversion or exchange of such options,
rights or securities. Aggregate consideration for purposes of the preceding
clause (B) shall be determined as follows: In case any options, rights or
convertible or exchangeable securities (or options or rights with respect
thereto) shall be issued or sold, or exercisable, convertible or exchangeable
for cash, the consideration received therefor shall be deemed to be the amount
payable to the Issuer (determined as set forth in subsection (ii)(x) and (y)
above) therefor (without deduction therefrom of any expenses incurred or any
underwriting commissions or concessions or discounts or, in the case of a
private placement thereof, finders' fees or commissions paid or allowed by the
Issuer in connection therewith). In case any such options, rights or securities
shall be issued or sold, or exercisable, convertible or exchangeable for a
consideration other than cash payable to the Issuer, the consideration received
therefor (determined as set forth in subsection (ii)(x) and (y) above) shall be
deemed to be the fair market value thereof as reasonably determined in good
faith by the Board (without deduction therefrom of any expenses incurred or any
underwriting commissions or concessions or discounts or, in the case of a
private placement thereof, finders' fees or commissions paid or allowed by the
Issuer in connection therewith). In case any such options, rights or securities
shall be issued or sold, or exercisable, convertible or exchangeable in
connection with any merger of another corporation into the Issuer, the amount
of consideration therefor shall be deemed to be the fair market value of such
portion of the assets of such merged corporation as the Board shall reasonably
determine to be attributable to such options, rights or securities.
SECTION 5.04. Superseding Adjustment. If at any time after any
adjustment in the number of shares of Warrant Stock comprising a Stock Unit
shall have been made on the basis of the issuance of any options or rights, or
convertible or exchangeable securities (or options or rights with respect to
such securities) pursuant to Section 5.03:
(a) the options or rights shall expire prior to exercise or
the right to convert or exchange any such securities shall terminate; or
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(b) the consideration per share for which shares of Common
Stock are issuable pursuant to the terms of such options or rights or
convertible or exchangeable securities shall be increased or decreased,
other than under or by reason of provisions designed to protect against
dilution,
such previous adjustment shall be rescinded and annulled, and thereupon a
recomputation shall be made of the effect of such options or rights or
convertible or exchangeable securities with respect to shares of Common Stock on
the basis of:
(A) treating the number of shares of Common
Stock, if any, theretofore actually issued
or issuable pursuant to the previous
exercise, conversion or exchange of such
options, rights or securities as having been
issued on the date or dates of such
exercise, conversion or exchange and for the
aggregate consideration actually received
and receivable therefor, and
(B) treating any such options, rights or
securities which then remain outstanding as
having been granted or issued immediately
after the time of such increase or decrease
for the aggregate consideration per share
for which shares of Common Stock are
issuable upon exercise, conversion or
exchange of such options, rights or
securities.
To the extent called for by the foregoing provisions of this Section 5.04 on the
basis aforesaid, a new adjustment in the number of shares of Warrant Stock
comprising a Stock Unit shall be made in accordance with Section 5.03,
determined using the Current Market Value as determined at the time of the
previous adjustment, which new adjustment shall supersede the previous
adjustment so rescinded and annulled. If the exercise, conversion or exchange
price provided for in any such option, right or security shall decrease at any
time under or by reason of provisions designed to protect against dilution and
there has been no anti-dilution adjustment under this Article V related to the
same event, then in the case of the delivery of shares of Common Stock upon the
exercise, conversion or exchange of any such option, right or security, the
Stock Unit purchasable upon the exercise of a Warrant shall forthwith be
adjusted (using a weighted average basis in accordance with the formula set
forth in Section 5.03 and using the Current Market Value as determined at the
time of initial issuance or sale thereof) in the manner which would have been
obtained had the adjustment made upon issuance of such option, right or security
been made upon the basis of the issuance of (and the aggregate consideration
received for) the shares of Common Stock delivered as aforesaid.
SECTION 5.05. Other Provisions Applicable to Adjustments. The
following provisions shall be applicable to the making of adjustments of the
number of shares of Warrant Stock comprising a Stock Unit:
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(a) The sale or other disposition of any issued shares of
Common Stock owned or held by or for the account of the Issuer (other
than to the Holders hereunder) shall be deemed to be an issuance
thereof for purposes of this Article V.
(b) In computing adjustments under this Article V, fractional
interests in Common Stock shall be taken into account to the nearest
one-thousandth of a share.
(c) If the Issuer shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive a dividend or
distribution or subscription or purchase rights and shall, thereafter
and before the distribution thereof, abandon its plan to pay or deliver
such dividend, distribution, subscription or purchase rights, then no
adjustment shall be required by reason of the taking of such record and
any such adjustment previously made in respect thereof shall be
rescinded and annulled.
SECTION 5.06. Merger, Consolidation or Disposition of Assets.
If the Issuer shall merge or consolidate with another Person, or shall sell,
transfer or otherwise dispose of all or substantially all of its assets to
another Person and pursuant to the terms of such merger, consolidation or
disposition of assets, cash, shares of common stock or other securities of the
successor or acquiring Person, or property of any nature is to be received by or
distributed to the holders of Common Stock, then each outstanding Warrant shall
automatically (effective as of the consummation of such merger, consolidation or
sale, transfer or disposition), without any further action on the part of the
Holder thereof, be converted into the right to receive (whether or not such
Holder exercises such Warrant) the amount of cash or other consideration it
would have been entitled to receive if such Holder had exercised such Warrant
(to the extent not previously exercised) immediately prior to the occurrence of
such merger, consolidation, sale, transfer or disposition, net of the aggregate
exercise price of such Warrant, and such Warrant shall thereupon be deemed to
have been exercised and be canceled.
SECTION 5.07. Other Action Affecting Common Stock. If at any
time or from time to time the Issuer shall take any action affecting its Common
Stock, other than an action described in any of the foregoing subsections of
this Article V or an action taken in the ordinary course of the Issuer's
business and consistent with past practice, then, unless in the reasonable
opinion of the Board such action will not have a material adverse effect upon
the rights of the Holders of the Warrants, the number of shares of Warrant Stock
comprising a Stock Unit shall be adjusted in such manner and at such time as the
Board shall in good faith determine to be equitable in the circumstances.
SECTION 5.08. Exclusions from Adjustment. Anything to the
contrary herein notwithstanding, no adjustment to the number of shares of
Warrant Stock comprising a Stock Unit shall be made as a result of, or in
connection with, the issuance of (a) any Common Stock, Convertible Security or
Option pursuant to an Option Plan or any Common Stock or Convertible Securities
issuable or issued upon the conversion, exchange or exercise of any such
Convertible
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Security or Option (so long as the issuance, conversion, exchange or exercise
price for such Common Stock, Convertible Security or Option is not less than
the closing price for the Common Stock on the date of grant or the next
preceding trading day on which a trade occurred), (b) any Common Stock issued
pursuant to the Issuer's Amended and Restated 1997 Stock Bonus Plan as in
effect on the date hereof, (c) any Common Stock or other securities pursuant to
the exercise, conversion or exchange of Convertible Securities or Options
outstanding on the Issuance Date and listed in Schedule 3.07(a), (d) any Common
Stock, Convertible Securities or Options pursuant to any merger transaction
involving the Issuer or any of its Subsidiaries or as consideration for the
acquisition by the Issuer or any of its Subsidiaries of the capital stock or
assets of any other Person (or any securities issued upon exercise or
conversion thereof), (e) any rights to purchase securities issued with respect
to each share of Common Stock pursuant to the Rights Agreement or (f) any Other
Warrants or any Common Stock or other securities issued upon the exercise or
conversion of the Warrants or the Other Warrants.
SECTION 5.09. Notice of Adjustments. Whenever the number of
shares of Warrant Stock comprising a Stock Unit shall be adjusted pursuant to
this Agreement, the Issuer shall forthwith obtain a certificate signed by the
Issuer's chief financial officer, setting forth, in reasonable detail, the event
requiring the adjustment and the method by which such adjustment was calculated
and specifying the number of shares of Warrant Stock comprising a Stock Unit,
after giving effect to such adjustment. The Issuer shall promptly cause a signed
copy of such certificate to be delivered to each Holder. The Issuer shall keep
at its office copies of all such certificates and cause the same to be available
for inspection at said office during normal business hours by any Holder or any
prospective purchaser of Warrants designated by any Holder.
SECTION 5.10. Notice of Certain Corporate Action. If the
Issuer shall propose (i) to pay any dividend to the holders of its Common Stock
or to make any other distribution to the holders of its Common Stock; (ii) to
offer to all holders of its Common Stock rights to subscribe for or to purchase
any additional shares of its Common Stock (or options or rights with respect
thereto) (other than rights under the Rights Agreement); (iii) to effect any
reclassification of its Common Stock; (iv) to effect any capital reorganization;
(v) to effect any consolidation, merger or sale, transfer or other disposition
of all or substantially all of its assets; (vi) to effect the liquidation,
dissolution or winding up of the Issuer; or (vii) to take any other action which
would require an adjustment to the number of shares of Warrant Stock comprising
a Stock Unit to be made in accordance with this Article V, then, in each such
case, the Issuer shall give to each Holder of Warrants a notice of such proposed
action as soon as reasonably practicable prior to the date of the relevant
transaction, which shall specify the date on which a record is to be taken for
the purposes of such dividend, distribution or rights offer, or the date on
which such reclassification, issuance, reorganization, consolidation, merger,
sale, transfer, disposition, liquidation, dissolution or winding up is to take
place and the date of participation therein by the holders of Common Stock, if
any such date is to be fixed, and shall also set forth such facts with respect
thereto as shall be reasonably necessary to indicate the effect of such action
on the
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Common Stock, and the number of shares of Warrant Stock which will comprise a
Stock Unit after giving effect to any adjustment which will be required as a
result of such action. The failure to give such notice, or any defect therein,
shall not affect the legality or validity of any dividend, distribution, right,
option, warrant, reclassification, reorganization, consolidation, merger, sale,
transfer, disposition, liquidation, dissolution or winding up, or the vote upon
any such action.
ARTICLE VI
REGISTRATION RIGHTS
SECTION 6.01. Demand and Piggyback Registrations. (a) Either
(i) upon receipt of notice (a "Demand Notice") from the Holders and/or Other
Holders of at least 25% of the sum of (I) the Warrant Stock issued or issuable
upon exercise of the Warrants (for which purpose, Holders of Warrants shall be
deemed holders of the Warrant Stock issued on exercise thereof) and (II) the
Other Warrant Stock issued or issuable upon exercise of the Other Warrants (for
which purpose, Other Holders of Other Warrants shall be deemed holders of the
Other Warrant Stock issued on exercise thereof) given at any time requesting
that the Issuer effect the registration of such Warrant Stock and Other Warrant
Stock held by such Holders and/or Other Holders, or (ii) whenever the Issuer
gives notice (a "Piggyback Notice") that it proposes to effect the registration
of all or any part of the Common Stock under the Securities Act (except pursuant
to registrations on Form S-4 or Form S-8 promulgated by the Commission or any
successor or similar forms thereto) (whether for its own account or for the
benefit of Shareholders other than holders of the Warrants, the Warrant Stock,
Other Warrants or Other Warrant Stock), the Issuer shall promptly, and in any
event at least 20 days prior to the effective date of the proposed registration
statement, give written notice of such proposed registration to all Holders and
Other Holders. Each Holder or Other Holder that wishes to register its Warrant
Stock or Other Warrant Stock, as the case may be, in such registration (each, a
"Seller") shall, within 15 days after receipt of such notice from the Issuer,
deliver to the Issuer a notice (a "Seller Notice") stating that such Seller
wishes to participate therein and setting forth the number of shares of Warrant
Stock or Other Warrant Stock that such Seller desires to include in such
registration. The Issuer thereupon shall, subject to Section 6.01(b) as
expeditiously as practicable, use its best efforts to effect the registration
under the Securities Act of such Warrant Stock and Other Warrant Stock (any such
registration effected or undertaken pursuant to a Demand Notice being herein
referred to as a "Demand Registration" and any such registration of Warrant
Stock or Other Warrant Stock effected in connection with a Piggyback Notice
being herein referred to as a "Piggyback Registration"); provided that (w) the
Issuer shall not be required to effect more than three Demand Registrations (and
each Demand Registration effected under the registration rights of the Other
Holders evidenced by the agreements under which the Other Warrants are issued
shall be considered a Demand Registration for purposes of the limitation set
forth in this clause (w)), (x) there shall be no limit on the number of
Piggyback Registrations, (y) no Demand Registration or Piggyback Registration
shall be available hereunder at any time after the fifth anniversary of
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the Issuance Date and (z) the Issuer shall not be required to honor a request
for a Demand Registration pursuant to which a registration statement would be
declared effective prior to the expiration of 120 days following the last
effective date of any previous registration statement pursuant to Section
6.01(a) (or pursuant to a comparable provision in an agreement under which
Other Warrants are issued). In the event that (i) the amount of securities
proposed to be sold by Sellers pursuant to a Demand Notice shall be reduced
pursuant to Section 6.02(a) to an amount which is less than 75% of the amount
of securities originally proposed to be sold by Sellers, or (ii) any Demand
Notice shall be withdrawn by the Holders and Other Holders originally giving
such Demand Notice at any time prior to the filing by the Issuer of a
preliminary registration statement in connection with such Demand Notice, then,
in such event, no right to a Demand Registration shall be deemed to have been
exercised or forfeited and such Demand Notice shall not operate to reduce the
Issuer's obligation to effect Demand Registrations on the terms provided herein.
(b) The Issuer may defer the filing (but not the preparation)
of a registration statement required by Section 6.01(a)(i) until a date not
later than 105 days after the date of the Demand Notice if at the time the
Issuer receives the Demand Notice, (i) the Issuer is conducting or is actively
pursuing a public offering of equity securities, (ii) the Issuer or any of its
Subsidiaries is engaged in confidential negotiations or other confidential
business activities, disclosure of which would be required in such registration
statement, and the Board determines in good faith that such disclosure would be
materially detrimental to the Issuer and its Shareholders or would have a
material adverse effect on any such confidential negotiations or other
confidential business activities or (iii) the Board determines in good faith
that there is a valid business purpose or reason for delaying filing. A deferral
of the filing of a registration statement pursuant to this Section 6.01(b) shall
be lifted, and the requested registration statement shall be filed forthwith, if
the event which resulted in such deferral is terminated (or, in the case of
negotiations of the type referred to in clause (ii) above, such negotiations are
disclosed). In order to defer the filing of a registration statement pursuant to
this Section 6.01(b), the Issuer shall promptly (but in any event within 10
days), upon determining to seek such deferral, deliver to each Seller a
certificate signed by an executive officer of the Issuer setting forth a
statement of the reason for such deferral and an approximation of the
anticipated delay, which information the Sellers shall treat as confidential.
Within 20 days after receiving such certificate, Sellers holding a majority in
interest of the Warrant Stock and Other Warrant Stock for which registration was
previously requested may withdraw such request by giving notice of such
withdrawal to the Issuer; if withdrawn, the Demand Notice shall be deemed not to
have been made for all purposes of this Agreement. The Issuer may not invoke its
right to defer the filing of a registration statement under this Section 6.01(b)
more than once in any twelve-month period.
(c) Neither the Issuer nor any of its security holders (other
than holders of the Warrants, the Warrant Stock, the Other Warrants or the Other
Warrant Stock) shall have the right to include any of the Issuer's securities in
a registration statement to be filed as part of a Demand Registration unless (i)
such securities are of the same class or series as the securities covered by
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such registration statement and (ii) if such Demand Registration is an
underwritten offering, the Issuer or such security holders, as applicable,
agree in writing to sell, subject to Section 6.02, their securities on the same
terms and conditions as apply to the securities being sold. If any security
holders of the Issuer (other than holders of the Warrants, the Warrant Stock,
the Other Warrants or the Other Warrant Stock) register securities in a Demand
Registration in accordance with this Section 6.01(c), such holders shall pay
the fees and expenses of their own counsel and their pro rata share, on the
basis of the respective amounts of the securities included in such registration
on behalf of each such security holder, of the expenses to be paid pursuant to
Section 6.04 if such expenses are not paid by the Issuer for any reason.
(d) If a Demand Registration involves an underwritten
offering, the Issuer shall have the right to select the investment banker(s) and
managing underwriter(s) to administer such offering, which investment banker(s)
or managing underwriter(s), as the case may be, shall be reasonably acceptable
to the holders of at least 50% of the Warrant Stock and Other Warrant Stock to
be included in such Demand Registration.
SECTION 6.02. Hold-Back Agreements; Cutbacks. (a) Each holder
of Warrant Stock or Other Warrant Stock that is covered by a registration
statement filed pursuant to Section 6.01 agrees, if requested by the managing
underwriters in an underwritten offering, not to effect any public sale or
distribution of securities of the Issuer of the same class as the securities
included in such registration statement, including a sale pursuant to Rule 144
under the Securities Act (except as part of such underwritten registration),
during the 15-day period prior to, and during the 90-day period beginning on,
the closing date of each underwritten offering made pursuant to such
registration statement, to the extent timely notified in writing by the Issuer
or the managing underwriters; provided that such holders of Warrant Stock and
Other Warrant Stock shall be subject to the hold-back restrictions of this
Section 6.02(a) (i) only once during any twelve-month period and (ii) unless
such underwriter(s) otherwise agree, only if each holder of equity securities of
the Issuer which is a party to a registration rights agreement with the Issuer
entered into on or after the date hereof, and each holder of equity securities
purchased from the Issuer (which is party to a registration rights agreement
with the Issuer entered into) at any time after the date of this Agreement
(other than in a public offering), shall have agreed, to the extent permitted by
law, not to effect any such public sale or distribution of such securities
(including a sale under Rule 144), during such period, except as part of such
underwritten registration.
The foregoing provisions shall not apply to any Holder of
Warrant Stock or Other Holder of Other Warrant Stock if such holder is prevented
by applicable statute or regulation from entering into any such agreement;
provided that such holder shall undertake, in its request to participate in any
such underwritten offering, not to effect any public sale or distribution of any
Warrant Stock or Other Warrant Stock held by such holder and covered by a
registration statement commencing on the date of sale of the Warrant Stock or
Other Warrant Stock, as the
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case may be, unless it has provided 45 days prior written notice of such sale
or distribution to the underwriter or underwriters.
(b) The Issuer agrees not to effect any public or private
offer, sale or distribution of any of its equity securities or any class or
series of its capital stock having a preference in liquidation or with respect
to dividends, including a sale pursuant to Regulation D under the Securities Act
(other than any such sale or distribution of such securities in connection with
any merger or consolidation by the Issuer or any subsidiary of the Issuer or the
acquisition by the Issuer or a subsidiary of the Issuer of the capital stock or
substantially all the assets of any other Person or in connection with any
employee stock option or other benefit plan), during the 10-day period prior to,
and during the 90-day period beginning with, the effectiveness of a registration
statement filed under Section 6.01 to the extent timely notified in writing by
any Holder of Warrant Stock, any Other Holder of Other Warrant Stock or the
managing underwriters in an underwritten offering (except as part of such
offering if permitted, or pursuant to registrations on Forms S-4 or S-8 or any
successor form to such registration Forms).
(c) In connection with any registration hereunder in which
more than one security holder has a right to request registration of its Common
Stock, in the event that such registration involves an underwritten offering and
the managing underwriter or underwriters participating in such offering advise
the security holders participating in such offering that the total number of
shares of Common Stock to be included in such offering exceeds the amount that
can be sold in (or during the time of) such offering without delaying or
jeopardizing the success of such offering (including the price per share of
Common Stock), then the total number of shares of Warrant Stock, Other Warrant
Stock and all other shares of Common Stock which have registration rights with
respect to such registration to be offered for the account of all security
holders shall be reduced to a number deemed satisfactory by such managing
underwriter or underwriters, provided that the shares of Common Stock to be
excluded shall be determined in the following sequence: there shall be excluded
(i) first, shares of Common Stock held by security holders of the Issuer
requesting and legally entitled to include such shares of Common Stock in such
registration pursuant to a "piggyback" registration (other than the holders of
Warrant Stock and/or Other Warrant Stock), on a pro rata basis (based upon the
number of shares of Common Stock requested (or proposed) to be registered by
each such holder, (ii) second, to the extent requesting to be included pursuant
to a Piggyback Registration, Warrant Stock and Other Warrant Stock, on a pro
rata basis (based upon the number of shares of Warrant Stock and Other Warrant
Stock requested to be included in such registration), (iii) third, shares of
Common Stock held by security holders of the Issuer requesting and legally
entitled to include such shares of Common Stock in such registration pursuant to
a "demand" registration (other than the holders of Warrant Stock and/or Other
Warrant Stock), on a pro rata basis (based upon the number of shares of Common
Stock requested (or proposed) to be registered by each such holder and (iv)
fourth, to the extent requesting to be included pursuant to a Demand
Registration, Warrant Stock and Other Warrant Stock, on a pro rata basis (based
upon the number of shares of Warrant Stock and Other Warrant Stock requested to
be included in such registration).
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SECTION 6.03. Registration Procedures. If and whenever the
Issuer is required by the provisions of Section 6.01(a)(i) or, with respect to
subsections (d), (g), (h), (i), (j), (k) and (n) of this Section 6.03, by the
provisions of Section 6.01(a)(i) or 6.01(a)(ii), to use its best efforts to
effect the registration of any of its securities under the Securities Act, the
Issuer shall, as expeditiously as possible,
(a) prepare and file with the Commission a registration
statement with respect to such securities and use its best efforts to
cause such registration statement to become and remain effective for a
period of not less than 90 days to permit the sale of such securities
in accordance with the plan of distribution chosen by the Seller or
Sellers and the underwriter, if any;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective and to comply with the provisions of the Securities
Act with respect to the sale or other disposition of all securities
covered by such registration statement;
(c) promptly notify each Seller and the underwriter or
underwriters, if any:
(i) when such registration statement or any
prospectus used in connection therewith, or any amendment or
supplement thereto, has been filed and, with respect to such
registration statement or any post-effective amendment
thereto, when the same has become effective;
(ii) of any written comments from the Commission with
respect to any filing referred to in clause (i) above and of
any written request by the Commission for amendments or
supplements to such registration statement or prospectus;
(iii) of the notification to the Issuer by the
Commission of its initiation of any proceeding with respect to
the issuance by the Commission of, or of the issuance by the
Commission of, any stop order suspending the effectiveness of
such registration statement; and
(iv) of the receipt by the Issuer of any notification
with respect to the suspension of the qualification of any
securities for sale under the applicable securities or blue
sky laws of any jurisdiction;
(d) furnish to each Seller such registration statement and of
each amendment and supplement thereto (including all exhibits and
documents incorporated by reference therein) and such numbers of copies
of a prospectus, including a preliminary prospectus, in conformity with
the requirements of the Securities Act, and such other documents, as
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such Seller may reasonably request in order to facilitate the public
sale or other disposition of the securities owned by such Seller;
(e) use its best efforts to register or qualify the securities
covered by such registration statement under such other securities or
blue sky laws of such jurisdictions within the United States as each
Seller shall reasonably request, and do such other reasonable acts and
things as may be requested of it to enable such Seller to consummate
the public sale or other disposition in such jurisdictions of the
securities owned by such Seller, except that the Issuer shall not for
any such purpose be required to qualify to do business as a foreign
corporation in any jurisdiction wherein it is not otherwise required to
be so qualified;
(f) use its best efforts to cause the securities covered by
such registration statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to
enable the Seller or Sellers thereof to consummate the disposition of
such securities;
(g) notify each Seller of any securities covered by such
registration statement, at any time when a prospectus relating thereto
is required to be delivered under the Securities Act, of the Issuer's
becoming aware that the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a
material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading in
the light of the circumstances under which they were made (upon receipt
of which each Seller agrees to forthwith cease making offers and sales
of such securities pursuant to such prospectus and to deliver to the
Issuer any copies of such prospectus then in the possession of such
Seller), and at the request of any such Seller promptly prepare and
furnish to such Seller a reasonable number of copies of a prospectus
supplemented or amended so that, as thereafter delivered to the
purchasers of such securities, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances under which
they were made;
(h) make available to its security holders, as soon as
reasonably practicable, an earnings statement covering the period of at
least twelve months, but not more than eighteen months, beginning with
one of the first three months after the effective date of the
registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act;
(i) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission;
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(j) use its best efforts to list such securities on any
securities exchange on which the Common Stock is then listed, or, if
not so listed, on a national securities exchange, if the listing of
such securities is then permitted under the rules of such exchange;
(k) provide a transfer agent and registrar for all the
securities covered by such registration statement not later than the
effective date of such registration statement;
(l) enter into such agreements and take such other actions as
the Seller or Sellers shall reasonably request in order to expedite or
facilitate the disposition of such securities;
(m) obtain an opinion from the Issuer's counsel and a "cold
comfort" letter from the Issuer's independent public accountants in
customary form and covering such matters as the Seller or Sellers shall
reasonably request;
(n) make available for inspection by any Seller of securities
covered by such registration statement, by any underwriter
participating in any disposition to be effected pursuant to such
registration statement and by any attorney, accountant or other agent
retained by any such Seller or any such underwriter, all pertinent
financial and other records, pertinent corporate documents and
properties of the Issuer, and cause all of the Issuer's officers,
directors and employees to supply all information reasonably requested
by any such Seller, underwriter, attorney, accountant or agent in
connection with such registration statement; and
(o) permit any Seller of securities covered by such
registration statement to require the insertion therein of material,
furnished to the Issuer in writing, which in the reasonable judgment of
such Seller should be included.
If any such registration or comparable statement refers to any Seller by name or
otherwise as the holder of any securities of the Issuer, then such Seller shall
have the right to require (x) the insertion therein of language, in form and
substance satisfactory to such Seller, to the effect that the holding by such
Seller of such securities is not to be construed as a recommendation by such
Seller of the investment quality of the Issuer's securities covered thereby and
that such holding does not imply that such Seller will assist in meeting any
future financial requirements of the Issuer, or (y) in the event that such
reference to such Seller by name or otherwise is not required by the Securities
Act or the Commission, the deletion of the reference to such Seller.
The Issuer may require each Seller of securities to, and each
such Seller, as a condition to including securities in such registration, shall,
furnish the Issuer with such information and affidavits regarding such Seller
and the distribution of such securities as the Issuer may from time to time
reasonably request in writing in connection with such registration. No Seller
may participate in any underwritten registration hereunder unless such Seller
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(x) agrees to sell such Seller's securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (y) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements and these
registration rights.
Each Seller of securities agrees that upon receipt of any
notice from the Issuer of the happening of any event of the kind described in
Section 6.03(g), such Seller will forthwith discontinue such Seller's
disposition of securities pursuant to the registration statement relating to
such securities until such Seller's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 6.03(g) and, if so directed by the
Issuer, will deliver to the Issuer (at the Issuer's expense) all copies, other
than permanent file copies, then in such Seller's possession of any prospectus
relating to such securities at the time of receipt of such notice.
SECTION 6.04. Registration Expenses. All expenses incident to
the Issuer's performance of or compliance with this Article VI, including
without limitation all (i) registration and filing fees, fees and expenses
associated with filings required to be made with the NYSE or NASD, (ii) fees and
expenses of compliance with securities or blue sky laws (including reasonable
fees and disbursements of counsel for the underwriters, if any, or selling
holders in connection with blue sky qualifications of the Warrant Stock and
Other Warrant Stock and determination of their eligibility for investment under
the laws of such jurisdictions as the managing underwriters, if any, or holders
of a majority of the Warrant Stock and the Other Warrant Stock being sold may
reasonably designate, provided that the Holders and the Other Holders
collectively shall be entitled to reimbursement for only one counsel in
connection with each registration), (iii) printing expenses (including expenses
of printing certificates for the Warrant Stock and the Other Warrant Stock in a
form eligible for deposit with The Depository Trust Company and of printing
prospectuses), (iv) fees and disbursements of counsel for the Issuer and
customary out of pocket expenses and fees paid by issuers to the extent provided
for in an underwriting agreement or otherwise (excluding discounts, commissions
or fees of underwriters, selling brokers, dealer managers or similar securities
industry professionals relating to the distribution of the Warrant Stock and
Other Warrant Stock, transfer taxes or legal expenses of any Person other than
the Issuer and the selling holders), (v) the cost of securities acts liability
insurance if the Issuer so desires and (vi) fees and expenses of other Persons
retained by the Issuer (all such expenses being herein called "Registration
Expenses") will be borne by the Issuer regardless of whether the Registration
Statement becomes effective. Each holder of Warrant Stock and Other Warrant
Stock will pay any fees or disbursements of counsel to such holder and all
underwriting discounts and commissions and transfer taxes, if any, and other
fees, costs and expenses of such holder (other than Registration Expenses)
relating to the sale or disposition of such holder's Warrant Stock or Other
Warrant Stock, as the case may be. The Issuer, in any event, will pay the
Issuer's own internal expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal or accounting duties),
the expense of any annual audit, the fees and expenses incurred in connection
with the listing of the
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securities to be registered on each securities exchange on which similar
securities issued by the Issuer are then listed, rating agency fees and the
fees and expenses of any Person, including special experts, retained by the
Issuer.
SECTION 6.05. Indemnification. (a) In the event of any
registration of any of its securities under the Securities Act pursuant to this
Article VI, the Issuer shall, to the full extent permitted by law, indemnify and
hold harmless each Seller of such securities, its directors, officers and
employees, and each other Person, if any, who controls such Seller within the
meaning of Section 15 of the Securities Act, against any losses, claims,
damages, liabilities or expenses ("Losses") to which such Seller or any such
director, officer or controlling Person may become subject under the Securities
Act or otherwise, insofar as such Losses (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in any registration statement under which such
securities were registered under the Securities Act, any preliminary prospectus,
final prospectus or summary prospectus contained therein, or any amendment or
supplement thereto, or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein (in the case of a prospectus, in light of the circumstances under which
there were made) not misleading, and shall reimburse such Seller or such
director, officer or controlling Person for any legal or any other expenses
reasonably incurred by such Seller or such director, officer or controlling
Person in connection with investigating or defending any such Loss; provided
that the Issuer shall not be liable in any such case to the extent that any such
Loss arises out of or is based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
preliminary prospectus, final prospectus, summary prospectus or amendment or
supplement in reliance upon and in conformity with written information furnished
by such Seller to the Issuer stating that it is for inclusion therein by such
Seller; provided further that with respect to any untrue statement or omission
or alleged untrue statement or omission made in any preliminary prospectus, the
indemnity agreement contained in this paragraph shall not apply to the extent
that any such Loss results from the fact that a current copy of the prospectus
was not sent or given to the Person asserting any such Loss at or prior to the
written confirmation of the sale of the securities concerned to such Person if
the Issuer had prior thereto given such Seller the notice referred to in Section
6.03(g) and provided to such Seller a supplemented or amended prospectus as
contemplated by Section 6.03(g), and such current copy of the prospectus would
have cured the defect giving rise to such Loss. Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of
such Seller or such director, officer or controlling Person, and shall survive
the transfer of such securities by such Seller.
(b) Each Seller of securities which are included in a
registration statement hereunder, as a condition to including securities in such
registration statement, shall, to the full extent permitted by law, indemnify
and hold harmless the Issuer, its directors and officers and each other Person,
if any, who controls the Issuer within the meaning of Section 15 of the
Securities Act, against any Losses to which the Issuer or any such director,
officer or controlling
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Person may become subject under the Securities Act or otherwise, insofar as
such Losses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
such registration statement, any preliminary prospectus, final prospectus or
summary prospectus contained therein, or any amendment or supplement thereto,
or any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein (in the case
of a prospectus, in the light of the circumstances under which they were made)
not misleading, if such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
written information furnished by such Seller to the Issuer stating that it is
specifically for use therein; provided, however, that the obligation to provide
indemnification pursuant to this Section 6.05(b) shall be several, and not
joint and several, among such Sellers on the basis of the number of securities
included by each in such registration statement and the aggregate amount which
may be recovered from any holder of securities pursuant to the indemnification
provided for in this Section 6.05(b) in connection with any sale of securities
shall be limited to the total proceeds received by such holder from the sale of
such securities. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Issuer or any such
other Person and shall survive the transfer of such securities by such Seller.
(c) Promptly after receipt by any Person entitled to
indemnification under this Section (an "Indemnified Party") of notice of the
commencement of any action, such Person shall, if a claim in respect thereof is
to be made against any other Person (an "Indemnifying Party") for indemnity
under this Section 6.05, notify the Indemnifying Party in writing of the
commencement thereof; but the omission so to notify the Indemnifying Party shall
not relieve it from any liability which it may have to any Indemnified Party,
except to the extent that the Indemnifying Party is prejudiced thereby. The
Indemnifying Party may, upon being notified of such action, assume the defense
thereof, with counsel satisfactory to such Indemnified Party, and, after such
assumption, the Indemnifying Party shall not be liable to such Indemnified Party
under this Section 6.05 for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such Indemnified Party, in
connection with the defense thereof; provided, however, that the Indemnifying
Party may not assume the defense of the action, and shall remain liable to the
Indemnified Party for its legal expenses of counsel and other expenses, in the
event that the Indemnified Party reasonably determines that a conflict of
interest may exist between the Indemnified Party and the Indemnifying Party. No
Indemnifying Party shall consent to entry of any judgment or enter into any
settlement of the relevant claim or litigation without the consent of the
Indemnified Party which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party of a release from
all liability in respect to such claim or litigation.
(d) If the indemnification provided for in this Section 6.05
is unenforceable although available, or insufficient to hold harmless an
Indemnified Party hereunder for any Losses (or actions in respect thereof) in
respect of which the provisions of Section 6.05(a) or (b)
Warrant Agreement
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33
would otherwise apply by their terms, then the Indemnifying Party shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Losses (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on the one
hand and the Indemnified Party on the other hand in connection with the
statements or omissions which resulted in such Losses (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact relates to information
supplied by the Indemnifying Party on the one hand or such Indemnified Party on
the other hand and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The parties agree that it would not be just and equitable if contribution
pursuant to this subsection were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to in this subsection. The amount paid or payable as a
result of the Losses (or actions in respect thereof) referred to above in this
subsection shall be deemed to include any legal or other expenses reasonably
incurred by such Indemnified Party in connection with investigating or
defending any such action or claim. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
SECTION 6.06. No Other Registration Rights. The Issuer shall
not hereafter, without the consent of the Required Holders, grant any
registration rights to any holder of Securities in respect of such Securities if
such registration rights would rank senior to, or otherwise adversely affect,
the registration rights granted in this Article VI. This Section 6.06 shall not
prohibit the grant of registration rights to others on a "pari passu" basis with
those granted in this Article VI.
ARTICLE VII
TAG-ALONG SALE
SECTION 7.01. Tag-Along Rights. (a) If at any time prior to
the third anniversary of the Issuance Date any Principal Shareholder or any
Related Party thereof (each a "Tag-Along Seller") shall enter into an agreement
to effect, or effect or propose to effect, any sale, transfer or other
disposition of Common Stock owned by such Principal Shareholder or Related Party
to any other Person (a "Tag-Along Sale"), each Holder of Warrants or Warrant
Stock shall have the right, but not the obligation, to participate in such
Tag-Along Sale by selling up to the number of shares (on an aggregate basis) of
Warrant Stock issued upon exercise of Warrants equal to the product of (i) the
total number of shares (on an aggregate basis) of Common Stock proposed to be
sold in the proposed Tag-Along Sale multiplied by (ii) a fraction, the numerator
of which is equal to the number of shares (on an aggregate basis) of Warrant
Stock owned by such Holder immediately prior to such Tag-Along Sale, and the
denominator of which is equal to (A) the number of shares (on an aggregate
basis) of Common Stock (and Common Stock then issuable under Options and
Convertible Securities) owned by the Tag-Along Seller immediately prior to such
Tag-Along Sale plus (B) the number of shares (on an aggregate basis) of Warrant
Stock owned by such Holder together with the number of shares (on an aggregate
basis) of Common Stock (and Common
Warrant Agreement
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34
Stock then issuable under Options and Convertible Securities) owned by any
holder thereof who has similar "tag-along" rights and elects to exercise such
rights in connection with the Tag-Along Sale, in each case immediately prior to
the Tag-Along Sale. Any such sales by such Holder shall be on the same terms
and conditions as the proposed Tag-Along Sale by the Tag-Along Seller, except
such Holder shall not be required to make any representations or warranties
other than with respect to (x) its title to and ownership of the shares of
Warrant Stock to be sold by it in such Tag-Along Sale, (y) such Holder's power
and authority to effect such transfer and (z) such matters pertaining to
compliance with securities law as the transferee of such Warrant Stock may
reasonably require. As a condition to participating in such Tag-Along Sale, any
such Holder proposing to sell Warrant Stock in such sale must exercise its
Warrants to acquire Common Stock representing such Warrant Stock. No Person
shall have the right to sell Warrants in any Tag-Along Sale.
(b) Notwithstanding the foregoing, the provisions of Sections
7.01(a) and 7.02 shall not apply to the following:
(I) any transfer, sale or disposition of any shares of Common
Stock by any Principal Shareholder or any Related Party thereof:
(i) to any Related Party of such Principal
Shareholder (or, in the case of any such Related Party, to
such Principal Shareholder), provided that prior to the
consummation of such transfer, sale or disposition, the
transferee (if not already party to a Joinder Agreement) shall
have entered into a Joinder Agreement);
(ii) in connection with any tender offer or other
disposition of Common Stock in connection with any business
combination involving the Issuer in which the Shareholders
generally shall have the right to participate;
(iii) by gift, to trusts and family partnerships for
estate or charitable planning purposes, by will or as a result
of inheritance laws;
(iv) in a registered public offering; and
(II) any other transfer, sale or disposition of any shares of
Common Stock by any Principal Shareholder or any Related Party thereof
(other than those permitted under clause (I) above); provided that the
total aggregate number of shares transferred, sold or disposed of by
such Principal Shareholder and its Related Parties under this clause
(II) after the Issuance Date shall not be more than 10% of the then
issued and outstanding Common Stock on a fully diluted basis.
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35
(c) On the date of execution of this Agreement the Issuer
shall deliver to the Initial Holders a joinder agreement substantially in the
form attached hereto as Annex 3 (a "Joinder Agreement"), executed by each
Principal Shareholder and each Related Party of such Principal Shareholder that
owns Common Stock, pursuant to which such parties will agree to be bound by the
provisions of this Article VII. As a condition to the validity of any sale,
disposition or other transfer of any Common Stock by any Person which has
executed and delivered a Joinder Agreement pursuant to this Section 7.01(c) to
any other Person which, after giving effect thereto, together with its Related
Parties would constitute a Principal Shareholder, such other Person (and each of
its Related Parties that owns Common Stock) shall execute and deliver to the
Issuer and each Holder a Joinder Agreement.
SECTION 7.02. Procedures. If a Tag-Along Seller is
participating in a Tag-Along Sale, at least 30 days before the proposed date
thereof, the Issuer shall provide each Holder of Warrants or Warrant Stock with
written notice of such Tag-Along Sale (a "Tag-Along Sale Notice") setting forth
in reasonable detail the consideration per share to be paid by the transferee,
the number of shares to be sold and the other terms and conditions of the
Tag-Along Sale. Each Holder of Warrants or Warrant Stock wishing to participate
in the Tag-Along Sale shall provide written notice (a "Tag-Along Participation
Notice") to such Tag-Along Seller and to the Issuer within 15 days of the date
the Tag-Along Sale Notice is deemed to have been received by such Holder. The
Tag-Along Participation Notice shall set forth the number of shares (on an
aggregate basis) of Warrant Stock, if any, such Holder elects to include in the
Tag-Along Sale. If a Holder, or Holders, of Warrants or Warrant Stock has
elected to participate in a Tag-Along Sale, the Tag-Along Seller shall reduce,
to the extent necessary, the number of shares of Common Stock that it is
entitled to sell in the Tag-Along Sale to permit the Holder, or Holders, of
Warrants or Warrant Stock to participate in the Tag-Along Sale and the Holder,
or Holders, of Warrant or Warrant Stock so electing shall sell in the Tag-Along
Sale such number of shares identified in its Tag-Along Participation Notice. If
the Tag-Along Participation Notice is not received from a Holder within the
15-day period specified above, the Tag-Along Seller shall have the right to sell
or otherwise transfer the shares of Common Stock to the proposed transferee
without any participation by such Holder, but only (i) on the terms and
conditions stated in the Tag-Along Sale Notice, and (ii) if the sale or transfer
of such shares of Common Stock is consummated not later than 60 days after the
end of such 15-day period specified above.
SECTION 7.03. Amendment of Article VII. No provision of this
Article VII may be amended without the written consent of each of the Principal
Shareholders and its Related Parties which is subject to the requirements of
this Article VII.
ARTICLE VIII
HOLDERS' RIGHTS
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36
SECTION 8.01. Delivery Expenses. If any Holder surrenders any
certificate for Warrants or Warrant Stock to the Issuer or a transfer agent of
the Issuer for exchange for instruments of other denominations or registered in
another name or names, the Issuer shall cause such new instruments to be issued
and shall pay the cost of delivering to or from the office of such Holder from
or to the Issuer or its transfer agent, duly insured, the surrendered instrument
and any new instruments issued in substitution or replacement for the
surrendered instrument.
SECTION 8.02. Taxes. The Issuer shall pay all taxes (other
than federal, state, local or foreign income, gross receipts, excise, severance,
capital stock, franchise, profits, withholding, personal property, sales, use,
transfer, registration, value added and alternative or add-on minimum taxes)
which may be payable in connection with the execution and delivery of this
Agreement or the issuance of the Warrants and Warrant Stock hereunder or in
connection with any modification of this Agreement or the Warrants and shall
hold each Holder harmless without limitation as to time against any and all
liabilities with respect to all such taxes. The obligations of the Issuer under
this Section 8.02 shall survive any redemption, repurchase or acquisition of
Warrants or Warrant Stock by the Issuer, any termination of this Agreement, and
any cancellation or termination of the Warrants.
SECTION 8.03. Replacement of Instruments. Upon receipt by
the Issuer of evidence reasonably satisfactory to it of the ownership of and the
loss, theft, destruction or mutilation of any certificate or instrument
evidencing any Warrants or Warrant Stock, and
(a) in the case of loss, theft or destruction, of indemnity
reasonably satisfactory to it (provided that if the Common Stock is not
at the time publicly traded and the owner of the same is any Holder or
an institutional lender or investor, its own agreement of indemnity
shall be deemed to be satisfactory), or
(b) in the case of mutilation, upon surrender or cancellation
thereof, the Issuer, at its expense, shall execute, register and
deliver, in lieu thereof, a new certificate or instrument for (or
covering the purchase of) an equal number of Warrants or Warrant Stock.
SECTION 8.04. Indemnification. The Issuer shall indemnify and
hold harmless each of the Holders and each of their respective directors,
officers, employees, shareholders, Affiliates and agents (each, an "indemnified
person") on demand from and against any and all losses, claims, damages,
liabilities (or actions or other proceedings commenced or threatened in respect
thereof) and expenses that arise out of, result from, or in any way relate to,
any claim, proceeding or other action made, brought or threatened against an
indemnified person relating to this Agreement or the Warrants, or in connection
with the other transactions contemplated hereby, and to reimburse each
indemnified person, upon its demand, for any reasonable legal or other expenses
incurred in connection with investigating, defending or participating in the
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-----------------
37
defense of any such loss, claim, damage, liability, action or other proceeding
(whether or not such indemnified person is a party to any action or proceeding
out of which any such expenses arise), other than any of the foregoing claimed
by any indemnified person to the extent incurred by reason of the gross
negligence or willful misconduct of such indemnified person. No indemnified
person shall be responsible or liable to either the Issuer or any other Person
for any damages which may be alleged as a result of or relating to this
Agreement or the Warrants (other than in connection with a breach of this
Agreement), or in connection with the other transactions contemplated hereby and
thereby. Any claim for indemnity in connection with or relating to a
registration of securities pursuant to Article VI shall be governed by Section
6.05, without regard to the provisions of this Section 8.04. No indemnified
person shall consent to entry of any judgment or enter into any settlement of
the relevant claim or litigation without the consent of the Issuer (such consent
not to be unreasonably withheld) that does not include as an unconditional term
thereof the giving by the claimant or plaintiff to the Issuer of a release from
all liability in respect to such claim or litigation.
SECTION 8.05. Inspection Rights. At any time prior to the
fifth anniversary of the Issuance Date, the Issuer shall afford, and shall cause
its Subsidiaries to afford, any Holder or its authorized agents, access, at
reasonable times, upon reasonable prior notice, (a) to inspect the books and
records of the Issuer and its Subsidiaries, (b) to discuss with management of
the Issuer and its Subsidiaries the business and affairs of the Issuer and its
Subsidiaries and (c) to inspect the properties of the Issuer and its
Subsidiaries, subject in each case to the provisions of Section 10.12(b) of the
Credit Agreement. At the request of the Issuer, if a Holder is not bound by such
Section 10.12(b), such Holder shall execute and deliver a confidentiality
agreement with the Issuer on substantially the same terms as set forth in said
Section 10.12(b).
ARTICLE IX
OTHER COVENANTS OF THE ISSUER
The Issuer agrees with each Holder that, so long as any of the Warrants
and/or Warrant Stock shall be outstanding and held by a Holder, provided that
the covenants set forth below shall expire not later than the fifth anniversary
of the Issuance Date:
SECTION 9.01. Financial Statements, Etc. The Issuer covenants
that it will file the reports required to be filed by it under the Securities
Act and the Exchange Act and the rules and regulations adopted by the Commission
thereunder (or, if it is not required to file such reports, it will, upon the
request of the Required Holders, make publicly available other information so
long as necessary to permit sales pursuant to Rule 144 under the Securities
Act), and it will take such further action as any Holder may reasonably request,
all to the extent required from time to time to enable such Holder to sell
Warrants or Warrant Stock without registration under the Securities Act within
the limitation of the exemptions provided by (a) Rule
Warrant Agreement
-----------------
38
144 under the Securities Act, as such Rule may be amended from time to time, or
(b) any similar rule or regulation hereafter adopted by the Commission. Upon
the request of any Holder, the Issuer will deliver to such Holder a written
statement as to whether it has complied with such information and filing
requirements.
SECTION 9.02. Related Party Transactions. The Issuer and its
Subsidiaries shall not, directly or indirectly, enter into any agreement or
transaction with any stockholder owning 10% or more of the Common Stock then
outstanding, officer or director of the Issuer, or any "affiliate" or
"associate" of such persons (as such terms are defined in rules and regulations
promulgated under the Securities Act), including, without limitation, any
agreement or transaction providing for the transfer of assets to, transfer of
opportunities in the Issuer's business to, rental of property from, or otherwise
requiring payments to, any such person or entity, without in each case the
approval of at least a majority of the members of the Board or a committee
thereof duly appointed to act with respect to such matter on behalf of the Board
having no interest in such agreement or transaction.
SECTION 9.03. Restrictions on Performance. The Issuer shall
not at any time enter into an agreement or other instrument limiting in any
manner its ability to perform its obligations under this Agreement or the
Warrants, or making such performance or the issuance of Warrant Stock upon the
exercise of any Warrant a default under any such agreement or instrument.
SECTION 9.04. Modification of Other Equity Documents. The
Issuer shall not amend or consent to any modification, supplement or waiver of
any provision of any Other Equity Documents in any manner which would have a
material adverse effect on the holders of Warrants or Warrant Stock, in each
case without the prior written consent of the Required Holders. Without limiting
the generality of the foregoing, the Issuer shall not amend, or consent to any
modification, supplement or waiver of any provision of any Other Equity
Documents in a way which would (i) restrict the transferability of the Warrants
or the Warrant Stock, (ii) restrict the transferability of the rights of any
Holder in this Agreement to any transferee of all or a portion of such Holder's
Warrants and/or Warrant Stock or (iii) require any consent or other approval of
any Person to the exercise of the Warrants by any Holder or the issuance of
Warrant Stock upon such exercise.
SECTION 9.05. Reservation and Authorization of Common Stock.
The Issuer shall at all times reserve and keep available for issue upon the
exercise or conversion of Warrants such number of its authorized but unissued
shares of Common Stock as will be sufficient to permit the exercise in full of
all outstanding Warrants. The Issuer shall not amend the provisions of its
certificate of incorporation governing the Common Stock other than (i) to
increase or decrease the number of shares of authorized capital stock (subject
to the provisions of the preceding sentence) or (ii) to decrease the par value
of any shares of Common Stock. All shares of Common Stock which shall be so
issuable, when issued upon exercise of any Warrant and
Warrant Agreement
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39
payment of the applicable Exercise Price therefor in accordance with the terms
of this Warrant, shall be duly and validly issued, fully paid and nonassessable
and free and clear of any Liens (other than those arising under operation of
applicable securities laws).
Before taking any action which would result in an adjustment
in the number of shares of Common Stock comprising a Stock Unit or which would
cause an adjustment reducing the Current Warrant Price per share of Common Stock
below the then par value, if any, of the shares of Common Stock issuable upon
exercise of the Warrants, the Issuer shall take any corporate action which is
necessary in order that the Issuer may validly and legally issue fully paid and
nonassessable shares of Common Stock free and clear of any Liens (other than
those arising under operation of applicable securities laws) upon the exercise
of all the Warrants immediately after the taking of such action.
Before taking any action which would result in an adjustment
in the number of shares of Common Stock comprising a Stock Unit or in the
Current Warrant Price per share of Common Stock, the Issuer shall obtain all
such authorizations or exemptions thereof, or consents thereto, as may be
necessary from any public regulatory body or bodies having jurisdiction thereof.
Promptly following the execution of this Agreement, the Issuer
will use best efforts to list on each national securities exchange on which any
Common Stock may at any time be listed, subject to official notice of issuance
upon exercise of the Warrants, and will maintain such listing of, all shares of
Common Stock from time to time issuable upon the exercise of the Warrants, and
as soon as reasonably practicable following completion of each such listing the
Issuer will notify the Holders thereof.
SECTION 9.06. Notice of Expiration Date. The Issuer shall give
-------------------------
to each Holder notice of the Expiration Date. Such notice may be given by the
Issuer not less than 30 days but not more than 60 days prior to the Expiration
Date; provided that if the Issuer fails to give timely notice, the Expiration
Date will be extended to the date which is 30 days after the day on which such
notice is deemed received.
SECTION 9.07. Documentation of Subsequent Warrants. The Issuer
------------------------------------
and the Initial Holders agree that the Issuer shall document any additional
warrants to purchase shares of Common Stock granted hereafter pursuant to
Section 6.12 of the Credit Agreement in substantially the same form as the
Warrants issued hereunder and pursuant to a warrant agreement in substantially
the same form as this Agreement.
ARTICLE X
MISCELLANEOUS
-------------
Warrant Agreement
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40
SECTION 10.01. Waiver. No failure on the part of any Holder to
------
exercise and no delay in exercising, and no course of dealing with respect to,
any right, power or privilege under this Agreement or the Warrants shall operate
as a waiver thereof, nor shall any single or partial exercise of any right,
power or privilege under this Agreement or the Warrant preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The remedies provided herein are cumulative and not exclusive of any remedies
provided by law.
SECTION 10.02. Notices. (a) All notices, requests and other
-------
communications provided for herein and in the Warrants (including any waivers or
consents under this Agreement and the Warrants) shall be given or made in
writing, (i) to any party hereto, delivered to the intended recipient at the
"Address for Notices" specified below its name on the signature pages hereof;
or, as to any party, at such other address as shall be designated by such party
in a written notice to each other party, or (ii) to any other Person who is the
registered Holder of any Warrants or Warrant Stock, to the address for such
Holder as it appears in the stock or warrant ledger of the Issuer.
(b) All such notices, requests and other communications shall
be deemed received on the date on which they are personally delivered, sent by
courier guaranteeing overnight delivery or sent by registered or certified mail,
return receipt requested, postage prepaid, in each case given or addressed as
aforesaid.
SECTION 10.03. Expenses, Etc. The Issuer agrees to pay or
--------------
reimburse the Holders for: (a) all reasonable out-of-pocket costs and expenses
of the Holders (including the reasonable fees and expenses of Milbank, Tweed,
Xxxxxx & XxXxxx LLP, special New York counsel to JPMorgan Chase Bank and its
Affiliates, but not the fees and expenses of counsel to any other Holder), in
connection with (i) the negotiation, preparation, execution and delivery of this
Agreement and the issuance of Warrants hereunder and (ii) any amendment,
modification or waiver of (or consents in respect of) any of the terms of this
Agreement and/or the Warrants; and (b) all costs and expenses of the Holders
(including reasonable legal fees and expenses) in connection with (i) any
default by the Issuer hereunder or under the Warrants or any enforcement
proceedings resulting therefrom and (ii) the enforcement of this Section 10.03.
SECTION 10.04. Amendments, Etc. Except as otherwise expressly
----------------
provided in this Agreement, any provision of this Agreement and any Warrant or
Warrant certificate issued hereunder may be amended or modified only by an
instrument in writing signed by the Issuer and the Required Holders; provided
--------
that (a) the consent of the holders of any class of Warrant Stock or Warrants
shall not be required with respect to any amendment or waiver which does not
affect the rights or benefits of such class under this Agreement, and (b) no
such amendment or waiver shall, without the written consent of all Holders of
such Warrant Stock and Warrants at the time outstanding, amend this Section
10.04.
Warrant Agreement
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41
SECTION 10.05. Successors and Assigns. This Agreement shall
----------------------
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
SECTION 10.06. Survival. All representations and warranties
--------
made by the Issuer herein or in any certificate or other instrument delivered by
it or on its behalf under this Agreement shall be considered to have been relied
upon by the Holders and shall survive the issuance of the Warrants or the
Warrant Stock regardless of any investigation made by or on behalf of the
Holders. All statements in any such certificate or other instrument so delivered
shall constitute representations and warranties by the Issuer hereunder. All
representations and warranties made by the Holders herein shall be considered to
have been relied upon by the Issuer and shall survive the issuance to the
Holders of the Warrants or the Warrant Stock regardless of any investigation
made by the Issuer or on its behalf.
SECTION 10.07. Specific Performance. Damages in the event of
--------------------
breach of this Agreement by a Holder or the Issuer would be difficult, if not
impossible, to ascertain, and it is therefore agreed that each Holder and the
Issuer, in addition to and without limiting any other remedy or right it may
have, will have the right to an injunction or other equitable relief in any
court of competent jurisdiction, enjoining any such breach, and enforcing
specifically the terms and provisions hereof, and each Holder and the Issuer
hereby waives any and all defenses it may have on the ground of lack of
jurisdiction or competence of the court to grant such an injunction or other
equitable relief. The existence of this right will not preclude the Holders or
the Issuer from pursuing any other rights and remedies at law or in equity which
the Holders or the Issuer may have.
SECTION 10.08. Captions. The captions and section headings
--------
appearing herein are included solely for convenience of reference and are not
intended to affect the interpretation of any provision of this Agreement.
SECTION 10.09. Counterparts. This Agreement may be executed in
------------
any number of counterparts, all of which when taken together shall constitute
one and the same instrument and any of the parties hereto may execute this
Agreement by signing any such counterpart signature page or counterpart.
SECTION 10.10. Governing Law. This Agreement shall be governed
-------------
by, and construed in accordance with, the law of the State of New York without
giving effect to the conflicts of law principles thereof, except to the extent
that New York conflicts of laws principles would apply the Delaware General
Corporation Law to matters relating to corporations organized thereunder.
SECTION 10.11. Severability. If any provision of this
------------
Agreement is held to be illegal, invalid or unenforceable under any present or
future law, and if the rights or obligations
Warrant Agreement
-----------------
42
of any party hereto under this Agreement will not be materially and adversely
affected thereby, (a) such provision will be fully severable, (b) this
Agreement will be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part hereof, (c) the remaining
provisions of this Agreement will remain in full force and effect and will not
be affected by the illegal, invalid or unenforceable provision or by its
severance herefrom and (d) in lieu of such illegal, invalid or unenforceable
provision, there will be added automatically as a part of this Agreement a
legal, valid and enforceable provision as similar in terms to such illegal,
invalid or unenforceable provision as may be possible.
SECTION 10.12. Entire Agreement. This Agreement supersedes all
----------------
prior discussions and agreements between the parties with respect to the subject
matter hereof and, together with the Warrants, contains the sole and entire
agreement between the parties hereto with respect to the subject matter hereof.
SECTION 10.13. Rights of Holders of Warrants. Nothing herein
-----------------------------
or in any Warrant shall be construed as conferring upon any Holder of Warrants
in its capacity as such (prior to the exercise of such Warrants) the right to
vote or to consent or to receive notice as a Shareholder in respect of meetings
of Shareholders or the election of directors of the Issuer or any other matter,
or any rights whatsover as Shareholders.
Warrant Agreement
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43
IN WITNESS WHEREOF, the parties hereto have duly executed this
Warrant Agreement as of the date first above written.
CHART INDUSTRIES, INC.
By___________________________
Name:
Title:
Address for Notices:
-------------------
Chart Industries, Inc.
0000 Xxxxxxxxxxx Xx.
Xxxxx 000
Xxxxxxxx Xxxxxxx, XX 00000
Attention: Chief Financial
Officer
Warrant Agreement
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44
INITIAL HOLDERS
---------------
JPMORGAN CHASE BANK
By___________________________
Name:
Title:
Address for Notices:
-------------------
XX Xxxxxx Xxxxx Bank
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
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45
NATIONAL CITY BANK
By___________________________
Name:
Title:
Address for Notices:
-------------------
National City Bank
0000 Xxxx Xxxxx Xxxxxx - Xxx.
0000
Xxxxxxxxx, XX 00000-0000
Warrant Agreement
-----------------
00
XXXX XXX, XXXXXXXX
By___________________________
Name:
Title:
Address for Notices:
-------------------
Bank One NA
IL1-0631
0 Xxxx Xxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxx Xxxxxxxx
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XXX XXXXXX PRIME RATE INCOME
TRUST
By: Xxx Xxxxxx Advisory
Investment Corp.
By___________________________
Name:
Title:
Address for Notices:
-------------------
Xxx Xxxxxx
Xxx Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxx
-and-
State Street Bank & Trust
Corporate Trust Department
X.X. Xxx 000
Xxxxxx, XX 00000
Attn: Xxxx Xxxxxxxx
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SENIOR DEBT PORTFOLIO
By: Boston Management and
Research,
as Investment Advisor
By___________________________
Name:
Title:
Address for Notices:
-------------------
Senior Debt Portfolio
c/o Boston Management and
Research
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
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U.S. BANK NATIONAL ASSOCIATION
By___________________________
Name:
Title:
Address for Notices:
-------------------
Xxxx Xxxxxx
U.S. Bank
U.S. Bancorp Center
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
Warrant Agreement
-----------------
00
XXXXX XXXX XX XXXXXXXXXX, N.A.
By___________________________
Name:
Title:
Address for Notices:
-------------------
Union Bancal Equities
Attention: Xxxxxxx Xxxxxxx, V.P.
000 Xxxxx Xxxxxxxx Xxxxxx, 00xx
Xxxxx
Xxx Xxxxxxx, XX 00000
(000) 000-0000
Warrant Agreement
-----------------
51
FLEET NATIONAL BANK
By___________________________
Name:
Title:
Address for Notices:
-------------------
Xxxx X. Xxxxxxx
FleetBoston Financial Corp.
000 Xxxxxxx Xx., 00xx Xxxxx
Xxxxxx, XX 00000
Warrant Agreement
-----------------
52
GENERAL ELECTRIC CAPITAL
CORPORATION
By___________________________
Name:
Title:
Address for Notices:
-------------------
Xxxxxx X. xxxXxxxx
General Electric Capital
Corporation
0 Xxxx Xxxxx Xxxx, Xxxxxxxx 0X
Xxxxxxxx, XX 00000
-and-
Xxxxxx Xxxxxxxxx
UBS Xxxxx Xxxxxx
1285 Avenue of the Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Warrant Agreement
-----------------
53
XXXXXX TRUST AND SAVINGS BANK
By___________________________
Name:
Title:
Address for Notices:
-------------------
Lending Services
000 X. Xxxxxx
00X
Xxxxxxx, XX 00000
Warrant Agreement
-----------------
54
THE HUNTINGTON NATIONAL BANK
By___________________________
Name:
Title:
Address for Notices:
-------------------
Xxxxx X. Xxxxx
Senior Vice President
Huntington National Bank
00 X. Xxxx Xxxxxx
XX 0000
Xxxxxxxx, XX 00000
Warrant Agreement
-----------------
55
ENDEAVOUR, LLC
by PPM America, Inc, its
attorney-in-fact
By___________________________
Name:
Title:
Address for Notices:
-------------------
PPM America, Inc.
000 X. Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Warrant Agreement
-----------------
56
CITIZENS BANK OF MASSACHUSETTS
By___________________________
Name:
Title:
Address for Notices:
-------------------
Citizens Bank of Massachusetts
00 Xxxxx Xxxxxx / XXX 000
Xxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Warrant Agreement
-----------------
57
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
By___________________________
Name:
Title:
By___________________________
Name:
Title:
Address for Notices:
-------------------
HVB Credit Advisors -
Special Asset Advisory
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000-0000
Warrant Agreement
-----------------
58
FIRST MERIT BANK N.A.
By___________________________
Name:
Title:
Address for Notices:
-------------------
FirstMerit Bank
000 X. Xxxxxxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: X. Xxxxxxx
Warrant Agreement
-----------------
59
KEYBANK NATIONAL ASSOCIATION
By___________________________
Name:
Title:
Address for Notices:
-------------------
Attn: Xxxxxx Xxxxx
OH-01-27-0504
000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Warrant Agreement
-----------------
60
KZH RIVERSIDE LLC
By___________________________
Name:
Title:
Address for Notices:
-------------------
Xxxxxxxx Xxxxxx
KZH RIVERSIDE LLC
c/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx 00xx Xxxxx
Xxx Xxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
E-Mail: virginia.r
xxxxxx@xxxxxxxx.xxx
Warrant Agreement
-----------------
61
KZH STERLING LLC
By___________________________
Name:
Title:
Address for Notices:
-------------------
Xxxxxxxx Xxxxxx KZH
STERLING LLC c/o JPMorgan
Chase Bank 000 Xxxx 00xx
Xxxxxx 00xx Xxxxx Xxx Xxxx,
XX 00000 Tel: 000-000-0000
Fax: 000-000-0000
E-Mail: virginia.r
xxxxxx@xxxxxxxx.xxx
Warrant Agreement
-----------------
62
KZH CYPRESSTREE - 1 LLC
By___________________________
Name:
Title:
Address for Notices:
-------------------
Xxxxxxxx Xxxxxx
KZH CypressTree-1 LLC
c/o JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx 00xx Xxxxx
Xxx Xxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
E-Mail: virginia.r
xxxxxx@xxxxxxxx.xxx
Warrant Agreement
-----------------
63
X.X. XXXXXX SECURITIES
INC., as agent for JPMorgan
Chase Bank
By
-------------------------
Name:
Title:
Address for Notices:
-------------------
Xxxxxxx Xxxxxx
1 Chase Xxxxxxxxx Xxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
Warrant Agreement
-----------------
Schedule 2.02
Allocation of Warrants
----------------------
Each Initial Holder (or its Affiliate or nominee) shall receive Warrants to
purchase that number of Stock Units set forth below opposite such Initial
Holder's (or its Affiliate's or nominee's) name:
------------------------------------------------------ ----------------------
INITIAL HOLDER NUMBER OF STOCK UNITS
------------------------------------------------------ ----------------------
JPMORGAN CHASE BANK 113,544
------------------------------------------------------ ----------------------
NATIONAL CITY BANK 112,254
------------------------------------------------------ ----------------------
BANK ONE, NA 97,722
------------------------------------------------------ ----------------------
XXX XXXXXX PRIME RATE INCOME TRUST 123,417
------------------------------------------------------ ----------------------
SENIOR DEBT PORTFOLIO 92,009
------------------------------------------------------ ----------------------
U.S. BANK NATIONAL ASSOCIATION 85,558
------------------------------------------------------ ----------------------
UNION BANCAL EQUITIES, INC. 73,907
------------------------------------------------------ ----------------------
FSC CORP. 64,706
------------------------------------------------------ ----------------------
GE CAPITAL CFE, INC. 69,007
------------------------------------------------------ ----------------------
NORM & CO. 62,556
------------------------------------------------------ ----------------------
THE HUNTINGTON NATIONAL BANK 64,706
------------------------------------------------------ ----------------------
ENDEAVOUR, LLC 62,556
------------------------------------------------------ ----------------------
CITIZENS FINANCIAL GROUP, INC. 64,706
------------------------------------------------------ ----------------------
BANK AUSTRIA CREDITANSTALT CORPORATE FINANCE, INC. 41,704
------------------------------------------------------ ----------------------
FIRSTMERIT BANK, N.A. 53,868
------------------------------------------------------ ----------------------
KEYBANK NATIONAL ASSOCIATION 41,704
------------------------------------------------------ ----------------------
Schedule 2.02 to Warrant Agreement
----------------------------------
2
KZH RIVERSIDE LLC 46,004
------------------------------------------------------ ----------------------
KZH STERLING LLC 46,004
------------------------------------------------------ ----------------------
KZH CYPRESSTREE - 1 LLC 23,002
------------------------------------------------------ ----------------------
JPMORGAN CHASE BANK 14,597
------------------------------------------------------ ----------------------
TOTAL: 1,353,531
------------------------------------------------------ ----------------------
Schedule 2.02 to Warrant Agreement
-------------------------------------
Schedule 3.07(a)
Existing Convertible Securities and Options
1. Convertible Securities and/or Options:
--------------------------------------
a. Warrants held by Chase Manhattan Bank to purchase an aggregate of 10,742
shares of Common Stock.
b. Warrants held by CIT Group/Equity Investments, Inc. to purchase an
aggregate of 12,434 shares of Common Stock.
c. Warrants held by the holders party to the Warrant Agreement dated as of
June 28, 2002, to purchase an aggregate of 513,559 shares of Common Stock.
d. Rights under the Rights Agreement.
2. Options:
--------
Shares Subject to
-----------------
Plan Outstanding Options
---- -------------------
a. Key Employees Stock Option Plan and
Second Amended and Restated 1997 Stock Option
and Incentive Plan 1,535,931
b. 2000 Executive Incentive Stock Option Plan 324,166
c. 1994 Stock Option Plan for Outside Directors 4,500
d. 1995 Stock Option Plan for Outside Directors 7,500
e. 1996 Stock Option Plan for Outside Directors 236,250
f. Rights under the Rights Agreement.
3. Amended and Restated Voluntary Deferred Income Plan: 75,037 shares
---------------------------------------------------
4. Commitments to issue securities:
-------------------------------
a. Contingent commitment to issue warrants to purchase an aggregate of
1,000,000 shares of Common Stock pursuant to the Indemnification and
Warrant Purchase Agreement, dated April 12, 1999, between the Issuer, MVE
Holdings, Inc. and each of the former members of MVE Investors, LLC.
Schedule 3.07(a) to Warrant Agreement
-------------------------------------
2
b. Contingent commitment to issue warrants to purchase shares of Common Stock
pursuant to Section 6.12 of the Credit Agreement.
c. Contingent and non-contingent commitments to issue securities pursuant to
the Issuer's 401(k) Investment and Savings Plan, 1996 Stock Option Plan for
Outside Directors and Amended and Restated 1997 Stock Bonus Plan.
d. Customary offers before the date hereof to grant Options to employees in
connection with an offer of employment.
e. Obligations to issue securities under the Rights Agreement.
Schedule 3.07(a) to Warrant Agreement
-------------------------------------
Schedule 3.07(b)
Existing Registration Rights
----------------------------
1. Registration rights granted to Chase Manhattan Bank and The CIT
Group/Equity Investments, Inc. pursuant to the Registration Rights
Agreement, dated August 30, 1991, among Cryenco Holdings, Inc, The CIT
Group/Equity Investments, Inc. and Chemical Bank.
2. Registration rights granted to the former members of MVE Investors LLC
pursuant to the Warrant Agreement, dated as of April 12, 1999, between
the Issuer and the parties thereto.
Schedule 3.07(b) to Warrant Agreement
-------------------------------------
Annex 1 to Warrant Agreement
[Form of Warrant]
WARRANT
THE TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS
SUBJECT TO THE RESTRICTIONS SPECIFIED IN THAT CERTAIN WARRANT AGREEMENT
DATED AS OF SEPTEMBER 30, 2002 (THE "WARRANT AGREEMENT") BETWEEN CHART
INDUSTRIES, INC., A DELAWARE CORPORATION (THE "ISSUER"), AND THE
HOLDERS PARTY THERETO FROM TIME TO TIME AS MODIFIED AND SUPPLEMENTED
AND IN EFFECT FROM TIME TO TIME, AND NO TRANSFER OF THE SECURITIES
REPRESENTED BY THIS CERTIFICATE SHALL BE VALID OR EFFECTIVE UNTIL SUCH
RESTRICTIONS HAVE LAPSED OR BEEN FULFILLED, RELEASED OR WAIVED. A COPY
OF THE FORM OF THE WARRANT AGREEMENT IS ON FILE AND MAY BE INSPECTED AT
THE PRINCIPAL EXECUTIVE OFFICE OF THE ISSUER. THE HOLDER OF THIS
CERTIFICATE, BY ACCEPTANCE OF THIS CERTIFICATE, AGREES TO BE BOUND BY
THE PROVISIONS OF THE WARRANT AGREEMENT.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE
SECURITIES LAWS, AND ACCORDINGLY, SUCH SECURITIES MAY NOT BE
TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH
THE REGISTRATION OR QUALIFICATION PROVISIONS OF APPLICABLE FEDERAL AND
STATE SECURITIES LAWS OR APPLICABLE EXEMPTIONS THEREFROM.
No. of Stock Units Covered Hereby: [__] Warrant No. [_]
WARRANT
to Purchase Common Stock of
CHART INDUSTRIES, INC.
THIS IS TO CERTIFY THAT [___________], or its registered
assigns (the "Holder"), is entitled to purchase in whole or in part from time to
time from CHART INDUSTRIES, INC., a Delaware corporation (the "Issuer"), at any
time prior to 5:00 p.m., New York time, on the third anniversary of the date
hereof (as it may be extended pursuant to Section
Warrant
-------
-2-
9.06 of the Warrant Agreement, the "Expiration Date"),[____] Stock Units at a
purchase price of $0.898 per Stock Unit (the "Exercise Price"), subject to the
terms and conditions hereinbelow provided. All capitalized terms unless
otherwise defined herein shall have the meanings set forth in the Warrant
Agreement.
On and after the date hereof and until 5:00 p.m., New York time, on the
Expiration Date, the Holder may exercise this Warrant, on one or more occasions,
on any Business Day, in whole or in part, by delivering to the Issuer:
(a) a written notice of the Holder's election to exercise
this Warrant, which notice shall specify the number of Stock Units to
be purchased (the "Exercise Notice");
(b) payment of the aggregate Exercise Price for the
number of Stock Units as to which this Warrant is being exercised
(payable as set forth below); and
(c) this Warrant.
The Exercise Price shall be payable (a) in cash or by
certified or official bank check payable to the order of the Issuer or by wire
transfer of immediately available funds to the account of the Issuer, (b) by
delivery (or causing to be delivered) to the Issuer of Loans held by the Holder
(or any of its Affiliates) and outstanding under, and the Note, if any,
evidencing the same issued pursuant to, the Credit Agreement (provided that, if
such Holder (or any such Affiliate or Affiliates) shall hold both Term Loans and
Revolving Credit Loans, such Loans so delivered by such Holder shall consist of
a ratable portion of the Term Loans and Revolving Credit Loans held by such
Holder and/or its Affiliates; and any such Loans so delivered shall deemed to be
paid for purposes of the Credit Agreement, with such payment in the case of such
Term Loans being applied in inverse order of the maturity thereof), with such
securities being credited against the Exercise Price in an amount equal to the
aggregate principal amount of such Loans (plus unpaid and accrued interest) so
delivered, or (c) by delivery of this Warrant Certificate to the Issuer for
cancellation in accordance with the following formula: in exchange for the
number of shares of Common Stock issuable on the exercise of the Warrants that
are being exercised at such time, the Holder shall receive such number of shares
of Common Stock as is equal to the product of (i) the number of shares of Common
Stock issuable upon exercise of the Warrants being exercised at such time
multiplied by (ii) a fraction, the numerator or which is the Current Market
Value per share of Common Stock at such time minus the Exercise Price per share
of Common Stock at such time, and the denominator of which is the Current Market
Value per share of Common Stock at such time. Such Exercise Notice shall be
substantially in the form of Exhibit A hereto. Upon receipt thereof, the Issuer
shall, as promptly as practicable and in any event within 5 Business Days
thereafter, execute or cause to be executed and deliver or cause to be delivered
to the Holder a certificate or certificates representing the aggregate number of
shares of Warrant Stock and other securities issuable upon such exercise and any
other property to which the Holder is entitled.
The certificate or certificates for Warrant Stock so delivered
shall be in such denominations as may be specified in the Exercise Notice and
shall be registered in the name of
Warrant
-------
-3-
the Holder or such other name or names as shall be designated in such Exercise
Notice. Such certificate or certificates shall be deemed to have been issued
and the Holder or any other Person so designated to be named therein shall be
deemed to have become a holder of record of Warrant Stock, including, to the
extent permitted by law, the right to vote Warrant Stock or to consent or to
receive notice as a Shareholder, as of the date on which the last of the
Exercise Notice, payment of the Exercise Price and this Warrant is received by
the Issuer as aforesaid, and all taxes required to be paid by the Holder, if
any, pursuant to the Warrant Agreement, prior to the issuance of Stock Units
have been paid. If this Warrant shall have been exercised only in part, the
Issuer shall, at the time of delivery of the certificate or certificates
representing Warrant Stock and other securities, execute and deliver to the
Holder a new Warrant evidencing the rights of the Holder to purchase the
unpurchased Stock Units called for by this Warrant, which new Warrant shall in
all other respects be identical with this Warrant, or, at the request of the
Holder, appropriate notation may be made on this Warrant and the same returned
to the Holder.
The Issuer shall not be required to issue a fractional amount
of Warrant Stock upon exercise of this Warrant. As to any fraction of a share of
Warrant Stock which the Holder would otherwise be entitled to purchase upon such
exercise, the Issuer shall pay a cash adjustment in respect of such final
fraction in an amount equal to the same fraction of the Current Market Value per
share of Warrant Stock on the date of exercise.
If reasonably requested by the Issuer in connection with the
exercise of this Warrant, the Holder shall deliver to the Issuer a certification
of taxpayer identification number or similar form so requested by the Issuer.
This Warrant shall be governed by, and construed in accordance
with, the law of the State of New York without giving effect to the conflicts of
law principles thereof, except to the extent that New York conflicts of laws
principles would apply the Delaware General Corporation Law to matters relating
to corporations organized thereunder.
Warrant
-------
-4-
IN WITNESS WHEREOF, the Issuer has duly executed this Warrant.
Dated: September 30, 2002
CHART INDUSTRIES, INC.
By ________________________
Name:
Title:
Attest:
------------------
Secretary
Warrant
-------
Exhibit A to Warrant
FORM OF EXERCISE
----------------
(To be executed by the registered holder hereof)
The undersigned registered owner of this Warrant irrevocably
exercises this Warrant for the purchase of [___] Stock Units of CHART
INDUSTRIES, INC., a Delaware corporation, and herewith makes payment therefor
[in cash, as provided in clause (a) of the third paragraph of this Warrant] [by
delivery of any Loans, as provided in clause (b) of the third paragraph of this
Warrant] [by delivery of the Warrant Certificate(s) for cancellation in
accordance with the formula provided in clause (c) of the third paragraph of
this Warrant], all at the price and on the terms and conditions specified in
this Warrant, and requests that certificates for the shares of Common Stock be
issued in accordance with the instructions given below, and, if such Stock Units
shall not include all of the Stock Units to which the Holder is entitled under
this Warrant, that a new Warrant of like tenor and date for the unpurchased
balance of the Stock Units issuable hereunder be delivered to the undersigned.
Dated: _____________, 200_
---------------------------------
(Signature of Registered Holder)
Instructions for issuance and
registration of Common Stock:
--------------------------------
Name of Registered Holder
(please print)
Social Security or Other Identifying
Number: _________________________
Please deliver certificate to
the following address:
------------------------------------
Street
Form of Exercise
----------------
------------------------------------
City, State and Zip Code
Form of Exercise
----------------
Annex 2 to Warrant Agreement
FORM OF ASSIGNMENT
------------------
(To be executed by the registered holder hereof)
FOR VALUE RECEIVED, the undersigned registered owner of this
Warrant hereby sells, assigns and transfers unto the assignee named below all
the rights of the undersigned under this Warrant and the related Warrant
Agreement with respect to the number of shares of Warrant Stock covered thereby
set forth hereinbelow unto:
Name of Assignee Address Number of Stock Units
-----------------------------------------------------------------
Dated: ____________, 200_
-------------------------------
Signature of Registered Holder
-------------------------------
Name of Registered Holder
(Please Print)
Witness:
-------------------
Form of Assignment
------------------
Annex 3 to Warrant Agreement
[Form of Joinder Agreement]
JOINDER AGREEMENT, dated as of [_______], 200[_] between CHART
INDUSTRIES, INC., a Delaware corporation (the "Issuer"), and the other parties
------
signatories hereto (this "Joinder Agreement").
-----------------
A. Reference is made to that certain Warrant Agreement dated as of
September 30 2002 (as modified and supplemented and in effect from
time to time, the "Warrant Agreement"), between the Issuer and the
Initial Holders. Each capitalized term used but not defined herein
shall have the meaning assigned to such term in the Warrant
Agreement; and
B. Section 7.01(c) of the Warrant Agreement requires that the Issuer
shall deliver to the Initial Holders this Joinder Agreement
executed by the Issuer, each Principal Shareholder and each
Related Party thereof that owns Common Stock.
In consideration of the foregoing and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
undersigned hereby agrees that:
1. The undersigned: (a) is delivering this Joinder Agreement
pursuant to Section 7.01(c) of the Warrant Agreement and (b) acknowledges
receipt of a copy of the Warrant Agreement.
2. The undersigned hereby agrees to be bound by the provisions of
Article VII of the Warrant Agreement (but no other provisions thereof).
IN WITNESS WHEREOF, the undersigned has signed this Joinder Agreement
as of the date first above written.
[________________]
By:______________________
Name:
Title:
Form of Joinder Agreement
-------------------------
-2-
Acknowledged and Agreed to as
of the date first above written:
CHART INDUSTRIES, INC.
By:____________________________
Name:
Title:
Form of Joinder Agreement
-------------------------
