Exhibit 4.1
EXECUTION COPY
TRANCHE A WARRANT AGREEMENT
THIS TRANCHE A WARRANT AGREEMENT dated as of November 10, 2003
(this "Agreement") is by and between GENTEK INC., a Delaware corporation
("GenTek" or the "Corporation"), and XXXXX FARGO BANK MINNESOTA, N.A., as
warrant agent (in such capacity, the "Warrant Agent").
PRELIMINARY STATEMENTS
WHEREAS, concurrently with the execution hereof, GenTek is
emerging from the protection of Chapter 11 of the United States
Code pursuant to that certain Joint Plan of Reorganization Under
Chapter 11, Xxxxx 00, Xxxxxx Xxxxxx Code of GenTek Inc., et al.,
and Noma Company dated August 28, 2003, as modified (the
"Plan"); and
WHEREAS, pursuant to the terms of, and subject to the
conditions contained in, the Plan, GenTek has agreed to issue
three tranches of warrants, tranches A, B and C, each to be
governed by a separate warrant agreement; and
WHEREAS, pursuant to the terms of, and subject to the
conditions contained in, the Plan, GenTek has agreed to issue
Tranche A Warrants (each, a "Tranche A Warrant") entitling the
holders thereof to purchase an aggregate of 1,173,184 shares,
subject to increase in certain cases pursuant to Sections 4.3(g)
and 4.3(h) of the Plan and the provisions of Section 4.01
hereof, of the common stock, no par value per share, of GenTek
(the Common Stock issuable upon exercise to include any
associated rights issued pursuant to a shareholders rights plan
or other agreement of similar purpose or effect), at an exercise
price of $58.50 per share; and
WHEREAS, GenTek wishes the Warrant Agent to act on its
behalf, and the Warrant Agent is willing to act on behalf of
GenTek, in connection with the issuance, exchange, transfer,
substitution and exercise of the Tranche A Warrants; and
WHEREAS, GenTek desires to enter into this Agreement to
set forth the terms and conditions of the Tranche A Warrants and
the rights and obligations of GenTek, the Warrant Agent and the
registered holders of the Certificates evidencing Tranche A
Warrants from time to time (the "Holders").
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements set forth herein and in the Plan, and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, GenTek and the Warrant Agent, intending to be legally bound,
hereby agree as follows:
ARTICLE I
Definitions and Interpretation
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Section 1.01.Certain Defined Terms. Capitalized terms used in
this Agreement shall have the following respective meanings, except as
otherwise provided herein or as the context shall otherwise require:
"Acquiror" has the definition given to it in the definition of
"Communications Acquisition Transaction" below.
"Affiliate" means, with respect to any Person, any other Person
that directly or indirectly, through one or more intermediaries,
controls, is controlled by or is under common control with such Person.
The term "control" (including, with correlative meaning, the terms
"controlled by" and "under common control with") means the possession,
directly or indirectly, of the power to direct or cause the direction
of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Black Scholes Value" shall mean the Black Scholes valuation of
a Tranche A Warrant with the following variables: (A) the "current
price" shall be the closing price per share on the trading date for
such common stock as reported by the Bloomberg Professional Service for
the exchange or quotation system on which such GenTek common stock
trades or is quoted on the trading date; (B) the "strike price" shall
be the Exercise Price in effect on the trading date; (C) the "interest
rate" shall be the yield to maturity (or the interpolation of such
yield, as applicable) for a U.S. Treasury security with a time to
maturity equivalent to the time between the trading date and November
10, 2006, determined as of a date not more than 3 days before the date
of such calculation; (D) "volatility" shall be equal to fifty-five
percent (55%); (E) the "term" shall be the remaining term of the
Tranche A Warrant; and (F) "trading date" shall be the date of the last
closing price prior to the first public announcement by GenTek of a
definitive agreement relating to a Communications Acquisition
Transaction.
"Bloomberg Professional Service" shall mean the interactive,
financial information network owned and operated by Bloomberg, L.P., or
its successor.
"Business Day" means any day which is not a day on which banking
institutions in New York City, New York are authorized or obligated by
law or executive order to close.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means GenTek's Common Stock, no par value per
share.
"Communications Acquisition Transaction" means a sale of all or
substantially all of the assets of the Communications Business or stock
of the subsidiaries that comprise the Communications Business in a
single transaction or a series of related transactions to any person or
entity (such person or entity being an "Acquiror"). Any sale,
consolidation or merger of the Corporation with or into another
corporation (where the Corporation is not the surviving corporation or
where there is a change in or distribution with respect to the Common
Stock) or other action which is subject to Section 4.01(c) of this
Agreement shall not be deemed to be a Communications Acquisition
Transaction.
"Communications Business" means the businesses conducted by the
following subsidiaries of GenTek: Krone International Holdings Inc. and
its affiliates through the principal operating groups known as
AccessNET, PremisNET, Krone Optical, and Krone Service (but excludes
the businesses of Printing Developments, Inc., Con-X Corporation and
Vigilant Networks, LLC).
"Convertible Securities" means evidence of indebtedness, shares
of stock or other securities (including, but not limited to, options
and warrants) which are directly or indirectly convertible, exercisable
or exchangeable, with or without payment of additional consideration in
cash or property, for shares of Common Stock, either immediately upon
the onset of a specified date or the happening of a specified event.
"Current Market Value" means, with respect to any security
(including Common Stock), as of a specified date (the "date of
calculation"):
(i) if such security is not registered under the Exchange
Act, the value of such security as determined by an Independent
Financial Expert; or
(ii) if such security is registered under the Exchange
Act, the average of the daily market prices of such security for
the 5 consecutive trading days commencing not more than 20
trading days before, and ending not later than, the earlier of
the date of calculation and the day before the "ex" date with
respect to the event requiring such calculation or, if such
security has been registered under the Exchange Act for less
than 5 consecutive trading days before such earlier date, then
the average of the daily market prices for all of the trading
days before such earlier date for which daily market prices are
available; provided, however, that if the market price cannot be
calculated (as provided below), the Current Market Value of such
security shall be determined as if such security were not
registered under the Exchange Act.
For purposes of this Agreement, (x) the term "market price" means, with
respect to any security for any trading day, (A) in the case of a
security listed or admitted to trading on any national securities
exchange, the closing sales price, regular way, on such day, or if no
sale takes place on such day, the average of the closing bid and asked
prices on such day on the principal national securities exchange on
which such security is listed or admitted, (B) in the case of a
security not then listed or admitted to trading on any national
securities exchange, the last reported sales price on such day, or if
no sale takes place on such day, the average of the closing bid and
asked prices on such day, as reported by a reputable quotation source
designated by GenTek, or (C) in the case of a security not then listed
or admitted to trading on any national securities exchange and as to
which no such reported sales price or bid and asked prices are
available, the average of the reported high bid and low asked prices on
such day, as reported by a reputable quotation service, or a newspaper
of general circulation in the Borough of Manhattan, City and State of
New York customarily published on each Business Day, designated by
GenTek, or, if there shall be no bid and asked prices on such day, the
average of the high bid and low asked prices, as so reported, on the
most recent day (not more than 30 days prior to the date in question)
for which prices have been so reported; and (y) the term "'ex' date,"
when used with respect to any distribution, shall mean the first date
on which the security trades regular way on such exchange or in such
market without the right to receive such distribution.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, or any similar Federal statute, and the rules and
regulations of the Securities and Exchange Commission thereunder, all
as the same shall be in effect at the time. Reference to a particular
section of the Securities Exchange Act of 1934, as amended, shall
include reference to the comparable section, if any, of any such
similar Federal statute.
"Exercise Price" has the meaning specified in Section 3.01, as
adjusted from time to time as provided for herein.
"Expiration Date" means, with respect to any Tranche A Warrant,
the earliest of (i) November 10, 2006, (ii) the date a payment is made
pursuant to Section 4.06 of this Agreement, or (iii) the date any
Tranche A Warrant is surrendered by a Holder pursuant to Section 9.03
herein.
"GenTek" has the meaning specified in the opening paragraph of
this Agreement.
"Governmental Authority" means (i) any nation or government,
(ii) any federal, state, county, province, city, town, municipality,
local or other political subdivision thereof or thereto, (iii) any
court, tribunal, department, commission, board, bureau,
instrumentality, agency, council, arbitrator or other entity exercising
executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government and (iv) any other
governmental entity, agency or authority having or exercising
jurisdiction over any relevant Person, item or matter.
"Holders" has the meaning specified in the Preliminary
Statements of this Agreement.
"Independent Financial Expert" means any financial expert
selected by GenTek that either (i) is reasonably acceptable to the
Holders of Warrant Certificates evidencing a majority of the
outstanding Tranche A Warrants or (ii) is a firm (x) which does not
(and whose directors, officers, employees and affiliates, to the
knowledge of GenTek, do not) have a material direct or indirect
financial interest in GenTek or any of its subsidiaries (other than by
virtue of compensation paid for advice or opinions referred to in the
exception to clause (z)), as determined by the Board of Directors of
GenTek in its good faith judgment, (y) which has not been, within the
last year from the time it is called upon, and, at such time that it is
called upon to give independent financial advice to GenTek or any of
its subsidiaries, is not (and none of whose directors, officers,
employees or affiliates, to the knowledge of GenTek, is) a promoter,
director or officer of GenTek or any of its subsidiaries or an
underwriter with respect to any of the securities of GenTek or any of
its subsidiaries and (z) which does not provide any advice or opinions
to GenTek or its subsidiaries except as an independent financial expert
in connection with this Agreement. Notwithstanding the foregoing,
Lazard Freres & Co. may serve as an Independent Financial Expert.
"Issue Date" has the meaning specified in Section 2.03 hereof.
"Laws" means all laws, statutes, rules, regulations, ordinances,
orders, writs, injunctions or decrees and other pronouncements having
the effect of law of any Governmental Authority.
"Original Issuance Date" means November 10, 2003, the effective
date of the Plan.
"Person" means any individual, limited liability company,
corporation, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, Governmental Authority or
other entity or enterprise.
"Plan" has the meaning specified in the Preliminary Statements
of this Agreement.
"Securities Act" means the Securities Act of 1933.
"Special Dividend" shall mean any payment by GenTek to all
holders of its Common Stock of any dividend, or any other distribution
by GenTek to such holders, of any shares of capital stock of GenTek,
evidences of indebtedness of GenTek, cash or other assets (including
rights, warrants, options, convertible securities or other securities
(of GenTek or any other Person)), other than any dividend or
distribution (i) upon a capital reorganization, reclassification,
merger or consolidation to which Section 4.01(c) applies, (ii) of any
common stock referred to in Section 4.01(a), (iii) pursuant to the
Plan, (iv) which is paid in cash by GenTek, so long as such dividend or
distribution, together with prior dividends in the same fiscal quarter,
does not exceed in the aggregate at the time of declaration of the
dividend and prior cash dividends in that fiscal quarter, 3% of the
Current Market Value of all Common Stock outstanding as of the date of
declaration of such dividend or distribution (and together with prior
dividends in the same fiscal year does not exceed in the aggregate at
the time of declaration of the dividend and prior cash dividends in
that fiscal year 10% of the Current Market Value of all Common Stock
outstanding as of the date of declaration of such dividend or
distribution in any fiscal year) (excluding any such dividend or
distribution included in a previous adjustment under Section 4.01) or
(v) subject to the final sentence of Section 4.01(d) hereof, paid in
connection with a shareholder's rights plan of GenTek.
"Tranche A Warrant" has the meaning specified in the Preliminary
Statements of this Agreement.
"Unlisted Black Scholes Valuation" shall mean the Black Scholes
valuation of a Tranche A Warrant performed by a nationally recognized
independent investment banking firm selected by the Board of Directors
of GenTek, utilizing, to the extent possible, the same variables as
provided for by the Black Scholes Value, which valuation shall be
utilized if GenTek's common stock is not listed on an exchange, The
Nasdaq Stock Market, Inc. ("NASDAQ") or any of its affiliates or quoted
on the over-the-counter bulletin board run by NASDAQ, which
determination shall be final, conclusive and binding upon GenTek and
the Holders.
"Warrant Agent" has the meaning specified in the opening
paragraph hereof.
"Warrant Certificates" has the meaning specified in Section
2.01.
Section 1.02.Interpretation. In this Agreement, unless a clear
contrary intention appears:
(a) the words "hereof," "herein" and "hereunder" and words of
similar import refer to this Agreement as a whole and not to any
particular provision of this Agreement;
(b) reference to any gender includes each other gender and the
neuter;
(c) all terms defined in the singular shall have the same
meanings in the plural and vice versa;
(d) reference to any Person includes such Person's heirs,
executors, personal representatives, administrators, successors and
assigns; provided, however, that nothing contained in this clause (d)
is intended to authorize any assignment not otherwise permitted by this
Agreement;
(e) reference to a Person in a particular capacity or capacities
excludes such Person in any other capacity;
(f) reference to any contract or agreement means such contract
or agreement as amended, supplemented or modified from time to time in
accordance with the terms thereof;
(g) all references to Articles and Sections shall be deemed to
be references to the Articles and Sections of this Agreement;
(h) all references to Exhibits shall be deemed to be references
to the Exhibits attached hereto which are made a part hereof and
incorporated herein by reference;
(i) the word "including" (and with correlative meaning
"include") means including, without limiting the generality of any
description preceding such term;
(j) with respect to the determination of any period of time, the
word "from" means "from and including" and the words "to" and "until"
each means "to but excluding";
(k) the captions and headings contained in this Agreement shall
not be considered or given any effect in construing the provisions
hereof if any question of intent should arise;
(l) reference to any Law means such Law as amended, modified,
codified, reenacted, supplemented or superseded in whole or in part,
and in effect from time to time;
(m) where any provision of this Agreement refers to action to be
taken by any Person, or which such Person is prohibited from taking,
such provision shall be applicable whether such action is taken
directly or indirectly by such Person; and
(n) no provision of this Agreement shall be interpreted or
construed against any Party solely because that Party or its legal
representative drafted such provision.
ARTICLE II
Original Issue of Tranche A Warrants
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Section 2.01.Form of Warrant Certificates. The Tranche A
Warrants shall be evidenced by certificates in registered form (the "Warrant
Certificates"), substantially in the form attached hereto as Exhibit A, and
may have such insertions, letters, numbers or other marks of identification
and such legends and endorsements stamped, printed, lithographed or engraved
thereon as may, consistently herewith, be determined to be reasonably
necessary or appropriate by the officers of GenTek executing such Warrant
Certificates as evidenced by their execution of the Warrant Certificates, or
as may be required to comply with any applicable Law or with any rule or
regulation of any securities exchange or to conform to usage. Each Tranche A
Warrant shall represent the right, subject to the provisions of this Agreement
and of the Warrant Certificate, to purchase one share of Common Stock at the
Exercise Price, subject to adjustment pursuant to the provisions of Section
4.01. The definitive Warrant Certificates shall be typed, printed,
lithographed or engraved or produced by any combination of these methods or
may be produced in any other manner permitted by applicable Law.
Section 2.02.Execution, Issuance, and Delivery of Warrant
Certificates. (a) Each Warrant Certificate, whenever issued, shall be dated as
of the date of countersignature thereof by the Warrant Agent (the "Issue
Date"), either upon initial issuance or upon exchange, substitution or
transfer and shall be executed on behalf of GenTek by its Chairman of the
Board, Chief Executive Officer, President, any Vice President, Treasurer or
Assistant Treasurer either manually or by facsimile signature printed thereon.
The Warrant Certificates shall be countersigned by manual or facsimile
signature of the Warrant Agent and shall not be valid for any purpose unless
so countersigned. In the event that any officer of GenTek whose signature
shall have been placed upon any of the Warrant Certificates shall cease to be
an officer of GenTek before countersignature by the Warrant Agent and the
issuance and delivery thereof, such Warrant Certificates may, nevertheless, be
countersigned by the Warrant Agent and issued and delivered with the same
force and effect as though such person had not ceased to be such officer of
GenTek.
(b) GenTek shall instruct the Warrant Agent to countersign,
issue and deliver, at the expense of GenTek, Warrant Certificates evidencing
Tranche A Warrants to purchase an aggregate of up to 1,173,184 shares of
Common Stock (subject to adjustment in accordance with the terms of this
Agreement), subject to increase in certain cases pursuant to Sections 4.3(g)
and 4.3(h) of the Plan and the provisions of Section 4.01 hereof, at the times
required by, and in accordance with the terms and conditions of, the Plan. The
Warrant Agent shall, and is hereby authorized to, countersign, issue and
deliver Tranche A Warrants as and when so instructed by GenTek. In addition,
the Warrant Agent is hereby authorized to countersign, issue and deliver
Warrant Certificates as required by Section 2.03, Section 3.03 or Article V.
Section 2.03.Transfer and Exchange of Warrant Certificates. (a)
The Warrant Agent shall maintain books, subject to such reasonable regulations
as it may prescribe, for the registration of Warrant Certificates and
transfers and exchanges of Warrant Certificates as provided in this Agreement.
Notwithstanding the foregoing, no Tranche A Warrant shall be exercisable
following the Expiration Date, provided that if a definitive agreement
relating to a Communications Acquisition Transaction has been entered into at
or prior to the Expiration Date and that agreement is in full force and effect
at the Expiration Date (without the payment provided for in Section 4.06
having been made), following the effective date the Tranche A Warrants shall
represent only the right of the Holder of record to receive the payment
provided for in Section 4.06 of this Agreement, and shall not be exercisable.
(b) The Warrant Agent shall from time to time register the
transfer of any outstanding Warrant Certificates upon the records to be
maintained by it for that purpose, upon surrender thereof accompanied by a
written instrument of transfer in the form of the assignment included in the
form of Warrant Certificate attached hereto as Exhibit A, duly executed by the
Holder or Holders or by the duly appointed legal representative thereof or by
a duly authorized attorney and otherwise complying with the terms of this
Agreement and all applicable Laws. No such transfer shall be effected until,
and such transferee shall succeed to the rights of a Holder only upon, final
registration of the transfer by the Warrant Agent in the register in
accordance with this Agreement. Upon any such registration of transfer, a new
Warrant Certificate of like tenor and representing in the aggregate a like
number of Tranche A Warrants shall be issued to the transferee and the
surrendered Warrant Certificates shall be canceled by the Warrant Agent in
accordance with Section 2.04. Warrant Certificates may be exchanged at the
option of the Holder thereof, when surrendered to the Warrant Agent at its
offices at Shareowner Services, at the addresses set forth in Section 9.04,
for another Warrant Certificate or other Warrant Certificates of like tenor
and representing in the aggregate a like number of Tranche A Warrants. Prior
to due presentation for registration of transfer, GenTek, the Warrant Agent
and any agent of GenTek may deem and treat the Person in whose name the
Warrant Certificates are registered as the absolute owner thereof for all
purposes (notwithstanding any notation of ownership or other writing thereon
made by anyone), and neither GenTek nor the Warrant Agent shall be affected by
any notice to the contrary or be bound to recognize any equitable or other
claim to or an interest in any Tranche A Warrants on the part of any other
Person and shall not be liable for any registration of transfer of Warrant
Certificates that are registered or to be registered in the name of a
fiduciary or the nominee of a fiduciary unless made with actual knowledge that
a fiduciary or nominee is committing a breach of trust in requesting such
registration of transfer or with such knowledge of such facts that its
participation therein amount to bad faith. To permit registrations of
transfers and exchanges, GenTek shall execute Warrant Certificates at the
Warrant Agent's request. No service charge shall be made for any exercise,
registration of transfer or exchange of Warrant Certificates and GenTek shall
pay all documentary stamp taxes attributable to the initial issuance of Common
Stock upon exercise of the Tranche A Warrants, but GenTek or the Warrant Agent
may require payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in respect of any registration of transfer of
Warrant Certificates involved in the issue of any Warrant Certificates or any
shares of Common Stock issuable upon exercise thereof in a name other than
that of the Holder of a Tranche A Warrant Certificate surrendered upon
exercise of a Tranche A Warrant.
(c) All Warrant Certificates issued upon any registration of
transfer or exchange of Tranche A Warrants shall be the valid obligations of
GenTek, evidencing the same obligations, and entitled to the same benefits
under this Agreement, as the Warrant Certificates surrendered for registration
of transfer or exchange.
Section 2.04.Surrender and Cancellation of Warrant Certificates.
Any Warrant Certificate surrendered for registration of transfer, exchange or
exercise of the Tranche A Warrants represented thereby or pursuant to Section
6.02 shall, if surrendered to GenTek, be delivered to the Warrant Agent, and
all Warrant Certificates surrendered or so delivered to the Warrant Agent
shall be promptly canceled by the Warrant Agent and shall not be reissued by
GenTek or the Warrant Agent and, except as provided in Section 2.03 (in the
case of a transfer or exchange), Section 3.03 (in the case of the exercise of
less than all the Tranche A Warrants represented by the surrendered Warrant
Certificate) or Article V (in the case of a lost, stolen, destroyed or
mutilated Warrant Certificate), no Warrant Certificate shall be issued
hereunder in lieu thereof. On request of GenTek, the Warrant Agent, provided
that any retention periods established by the Securities and Exchange
Commission have expired, shall destroy canceled Warrant Certificates held by
it and shall deliver its certificates of destruction to GenTek. The Warrant
Agent shall destroy all canceled Warrant Certificates in accordance with its
normal procedures.
ARTICLE III
Exercise Price; Exercise of Tranche A Warrants
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Section 3.01.Exercise Price. Each Warrant Certificate shall,
when countersigned by the Warrant Agent, entitle the Holder thereof, subject
to the provisions of this Agreement and such Warrant Certificate, to purchase
one share of Common Stock (subject to adjustment as provided herein) for each
Tranche A Warrant represented thereby at a cash purchase price (the "Exercise
Price") of $58.50 per share (subject to adjustment as provided herein),
payable in full at the time of purchase, subject to Section 3.03 herein.
Section 3.02.Exercise; Restrictions on Exercise. (a) Each
outstanding Tranche A Warrant may be exercised on any Business Day which is on
or after its Issue Date and on or before the Expiration Date. Any Tranche A
Warrants not exercised by 5:00 p.m., New York City time, on the Expiration
Date shall expire and all rights thereunder and all rights in respect thereof
under this Agreement shall automatically terminate at such time; provided,
however, that in the event a definitive agreement relating to a Communications
Acquisition Transaction has been entered into prior to the Expiration Date,
but the Communications Acquisition Transaction has not been consummated or a
corresponding payment pursuant to Section 4.06 hereof has not been made prior
to the Expiration Date, Holders shall retain the right to receive such a
payment, if any, until 180 days following the Expiration Date.
Section 3.03. Method of Exercise; Payment of Exercise Price.
(a) In order to exercise any of the Tranche A Warrants, the Holder thereof
must surrender the Warrant Certificate evidencing such Tranche A Warrants to
the Warrant Agent at its office of Shareowner Services set forth in Section
9.04 (with the Subscription Form set forth in the Warrant Certificate duly
executed with the signature of the Holder guaranteed), together with payment
in full of the Exercise Price then in effect for each share of Common Stock as
to which a Tranche A Warrant is exercised and any applicable taxes that GenTek
is not required to pay pursuant to this Section 3.03, Sections 2.03(b) or
9.02(a) or Article V. Payment of the Exercise Price shall be made (or deemed
made, in the case of a cashless exercise in accordance with clause (ii)), by
the Holder (i) in United States currency by delivery of a certified check or
bank cashier's check payable to the order of GenTek, or by wire transfer of
immediately available funds to an account designated by the Warrant Agent for
the benefit of GenTek or (ii) by cancellation of such number of shares of
Common Stock otherwise issuable to the Holder upon such exercise as shall be
specified in such Subscription Form, so as to yield a number of shares of
Common Stock such that the aggregate of the fair market value attributable to
such cancelled shares as of the date hereof shall equal the aggregate Exercise
Price attributable to the shares of Common Stock to be issued upon such
exercise, in which case such amount shall be deemed to have been paid to
GenTek and the number of shares issuable upon such exercise shall be reduced
by such specified number (such form of payment being a "Cashless Exercise").
Upon the exercise of any Tranche A Warrant, the Warrant Agent shall promptly
provide written notice of such exercise to GenTek, including notice of the
number of shares of Common Stock delivered upon the exercise of such Tranche A
Warrant, and deliver all payments, if any, received upon exercise of such
Tranche A Warrant to GenTek in such manner as GenTek shall instruct in
writing. For purposes of a Cashless Exercise, fair market value shall be
determined as follows: (a) if traded on a securities exchange, the fair market
value shall be based upon the average of the closing prices over a five (5)
day period ending with the third business day before the day the current fair
market value of the securities is being determined; or (b) if traded on the
over-the-counter bulletin board, the fair market value shall be based upon the
average of the closing bid and asked prices quoted on the NASDAQ system (or
similar system) over the five (5) day period ending with the third business
day before the day the current fair market value of the securities is being
determined; or (c) if at any time the Common Stock is not listed on any
securities exchange or quoted in the NASDAQ system or the over-the-counter
bulletin board, the current fair market value shall be determined by the
Company in good faith.
(b) A Holder may exercise all or any number of whole Tranche A
Warrants represented by a Warrant Certificate. If less than all of the Tranche
A Warrants represented by a Warrant Certificate are exercised, such Warrant
Certificate shall be surrendered in conformity with the foregoing provisions
and a new Tranche A Warrant Certificate executed by GenTek of the same tenor
and for the whole number of Tranche A Warrants which were not exercised shall
be issued promptly (and in any event, within the timeframe included in the
Securities and Exchange Commission guidelines relating to turnaround of the
transfer of securities) by the Warrant Agent. The Warrant Agent shall (i)
countersign such Warrant Certificate, (ii) register such Warrant Certificate
in such name or names as may be directed in writing by the Holder and (iii)
deliver such Warrant Certificate to the Person or Persons entitled to receive
the same.
(c) Upon the exercise of any Tranche A Warrant and the surrender
of the Warrant Certificate evidencing such Tranche A Warrant in conformity
with the foregoing provisions, the Warrant Agent shall, subject to Section
9.02, (i) transfer promptly (and in any event, within the timeframe included
in the Securities and Exchange Commission guidelines relating to turnaround of
the transfer of securities) to or as per the written instruction of the Holder
of such Warrant Certificate, appropriate evidence of ownership of any shares
of Common Stock or other securities or property (including money) to which it
is entitled, registered or otherwise placed in such name or names as may be
directed in writing by the Holder, and (ii) deliver such evidence of ownership
and any other securities or property (including money) to the Person or
Persons entitled to receive the same (together with an amount in cash in lieu
of any fractional shares as provided in Section 4.05).
(d) Upon the exercise of any Tranche A Warrant, the Warrant
Agent is hereby authorized and directed to requisition from any transfer agent
of the Common Stock (and all such transfer agents are hereby irrevocably
authorized to comply with all such requests) certificates for the necessary
number of shares of Common Stock to which the Holder of such Tranche A Warrant
may be entitled upon such exercise.
(e) Any Tranche A Warrant which is exercised hereunder shall be
deemed to have been exercised immediately prior to the close of business on
the date of the surrender, as provided above, of the Warrant Certificate
representing such Tranche A Warrant, together with payment in full of the
Exercise Price and any applicable taxes that GenTek is not required to pay
pursuant to this Section 3.03, Sections 2.03(b) or 9.02(a) or Article V, and,
for purposes of this Agreement, the Person entitled to receive any shares of
Common Stock or other securities or property deliverable upon such exercise
shall, as between such Person and GenTek, be deemed to be the Holder of such
shares of Common Stock or other securities or property of record as of the
close of business on such date and shall be entitled to receive, and GenTek
shall deliver or cause to be delivered to such Person, any money, shares of
Common Stock or other securities or property to which he would have been
entitled had he been a record holder on such date.
ARTICLE IV
Adjustments
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Section 4.01.Adjustments. The number of shares of Common Stock
issuable upon exercise of each Tranche A Warrant shall be subject to
adjustment from time to time as follows:
(a) Upon Stock Dividends, Subdivisions or Splits. If, at any time
after the Original Issuance Date, the number of shares of Common Stock
outstanding is increased by a stock dividend or distribution on the
outstanding shares of Common Stock payable in shares of Common Stock or by a
subdivision or split-up of shares of Common Stock, other than, in any such
case, upon a capital reorganization, reclassification, consolidation or merger
to which Section 4.01(c) applies, then, following the record date for the
determination of holders of Common Stock entitled to receive such stock
dividend, or to be affected by such subdivision or split-up, the number of
shares of Common Stock purchasable on exercise of the Tranche A Warrants shall
be increased in proportion to such increase in outstanding shares. The
adjustment made pursuant to this clause (a) shall be made successively upon
any such transaction and shall become effective (x) in the case of any such
dividend or distribution, immediately after the close of business on the
record date for the determination of holders of shares of Common Stock
entitled to receive such dividend or distribution or (y) in the case of such
subdivision or split-up, at the close of business on the day upon which such
corporate action becomes effective.
(b) Upon Combinations or Reverse Splits. If, at any time after the
Original Issuance Date, the number of shares of Common Stock outstanding is
decreased by a combination or reverse split of the outstanding shares of
Common Stock into a smaller number of shares of Common Stock, other than, in
any such case, upon a capital reorganization, reclassification, consolidation
or merger to which Section 4.01(c) applies, then the number of shares of
Common Stock purchasable on the exercise of each Tranche A Warrant immediately
prior to the date of such combination or reverse split shall be decreased in
proportion to such decrease in outstanding shares. The adjustment made
pursuant to this clause (b) shall be made successively upon any such
transaction and shall become effective at the close of business on the day
upon which such combination or reverse split becomes effective. For purposes
of Sections 4.01(a) and 4.01(b), the number of shares of Common Stock at any
time outstanding shall not include any shares of Common Stock then owned or
held by or for the account of the Corporation.
(c) Upon Reclassifications, Reorganizations, Consolidations or
Mergers. In the event of any capital reorganization of the Corporation, any
reclassification of the stock of the Corporation (other than a change in par
value or from no par value to par value or from par value to no par value or
as a result of a stock dividend or subdivision, split-up or combination or
reverse split of shares), or any consolidation or merger of the Corporation
with or into another corporation (where the Corporation is not the surviving
corporation or in connection with which the Common Stock outstanding prior to
the transaction shall be changed into or exchanged for different securities of
GenTek or capital stock or other securities of another corporation or
interests in a non-corporate entity or other property (including cash, if any)
or any combination of the foregoing), or any sale, transfer or lease of all or
substantially all of the assets of GenTek (on a consolidated basis), each
Tranche A Warrant, effective at the close of business on the date such
reorganization, reclassification, consolidation, merger or sale shall become
effective, shall thereafter be exercisable for the kind and number of shares
of stock or other securities or property (including cash, if any) receivable
upon the consummation of such reorganization, reclassification, consolidation,
merger or sale, by a holder of the number of shares of Common Stock
deliverable (immediately prior to the time of such reorganization,
reclassification, consolidation, merger or sale) upon exercise of such Tranche
A Warrant and, except as specified in 4.01(k), otherwise shall have the same
terms and conditions applicable immediately prior to such time of such
reorganization, reclassification, consolidation, merger or sale. The
provisions of this clause shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers or sales.
(d) Certain Other Dividends and Distributions. In case at any time or
from time to time after the Original Issuance Date GenTek shall effect a
Special Dividend, then, and in each such case, effective immediately prior to
the opening of business on the day after the date for the determination of the
holders of Common Stock entitled to receive such distribution, the number of
shares of Common Stock into which each Tranche A Warrant is exercisable shall
be adjusted to that number determined by multiplying the number of shares of
Common Stock into which each Tranche A Warrant is exercisable immediately
prior to the close of business on such date of determination by a fraction,
(i) the numerator of which shall be the Current Market Value per share of
Common Stock on such date for determination and (ii) the denominator of which
shall be such Current Market Value per share of Common Stock minus the portion
applicable to one share of Common Stock of the fair market value (as
determined in good faith by the Board of Directors of GenTek) of such
securities, cash or other assets so distributed. The adjustment shall be made
successively whenever GenTek shall effect a Special Dividend. Notwithstanding
anything to the contrary provided in this Agreement, this Section 4.01(d) does
not apply to a distribution of rights pursuant to any shareholder rights plan
adopted by GenTek or other agreement of similar purpose or effect provided
that the Holders shall be entitled to such rights upon exercise of the Tranche
A Warrants.
(e) Issuance of Common Stock. If at any time after the Original
Issuance Date, GenTek shall (except as hereinafter provided in this Section
4.01(e)) issue or sell any additional shares of Common Stock for a
consideration per share less than the Current Market Value per share, other
than, in any such case, upon a capital reorganization, reclassification,
consolidation or merger to which Section 4.01(c) applies, then, effective on
the date specified below, the number of shares of Common Stock purchasable on
the exercise of each Tranche A Warrant immediately prior to the date of such
issuance shall be adjusted by multiplying (i) the number of shares of Common
Stock purchasable on the exercise of each Tranche A Warrant immediately prior
to the date of such issuance by (ii) a fraction, (A) the numerator of which
shall be the sum of (I) the number of shares of Common Stock outstanding
immediately prior to the issuance of such additional shares of Common Stock,
(II) the number of shares of Common Stock issuable upon the conversion or
exercise of options, warrants rights or convertible securities (whether or not
then exercisable) and (III) the number of such additional shares of Common
Stock so issued and (B) the denominator of which shall be the sum of (I) the
number of shares of Common Stock outstanding immediately prior to the issuance
of such additional shares of Common Stock, (II) the number of shares of Common
Stock issuable upon the conversion or exercise of options, warrants rights or
convertible securities (whether or not then exercisable) and (III) the number
of shares of Common Stock which the aggregate consideration for the total
number of such additional shares of Common Stock so issued would purchase at
the Current Market Value per share. The date as of which the Current Market
Value per share shall be computed shall be the earlier of the date on which
GenTek shall enter into a firm contract or commitment for the issuance of such
additional shares of Common Stock or the date of actual issuance of such
additional shares of Common Stock.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately on the date of such issuance.
No adjustment of the number of shares of Common Stock purchasable on
the exercise of each Tranche A Warrant shall be made under this Section
4.01(e) upon the issuance of any additional shares of Common Stock which are
issued pursuant to:
(i) the exercise of a Tranche A Warrant or other warrants
outstanding as of the date of this Agreement in whole or in part, or the
conversion or exchange of other securities outstanding on the date of this
Agreement which are convertible or exchangeable for Common Stock;
(ii) any issuance of additional shares of Common Stock for
which an adjustment is otherwise provided under Section 4.01 hereof;
(iii) Common Stock issued to GenTek's employees, consultants
or directors under a bona fide stock option or purchase plans or benefit plans
adopted or assumed by the Board of Directors or GenTek's compensation
committee;
(iv) Common Stock issuable upon (x) the exercise of rights
or warrants issued to the holders of Common Stock for which adjustment was
previously made pursuant to Section 4.01(d) or (y) exercise or conversion of
Convertible Securities (whether or not an antidilution adjustment was made
pursuant to Section 4.01(f) hereof);
(v) Common Stock issued to shareholders of any person which
merges into GenTek in proportion to the stock holdings of such person
immediately prior to such merger, upon such merger;
(vi) Common Stock issued in a bona fide public offering
pursuant to a firm commitment underwriting;
(vii) Common Stock issued in a bona fide private placement
through a placement agent or a bona fide private offering through initial
purchasers pursuant to an exemption from, or in a transactions not subject to,
the registration requirements of the Exchange Act and applicable state
securities laws, where the placement agent, or as the case may be, each of the
initial purchasers is a member firm of the National Association of Securities
Dealers, Inc. to persons that are not Affiliates of GenTek (except to the
extent that any discount from the current market price attributable to
restrictions on transferability of the Common Stock, as determined in good
faith by the Board of Directors and described in a resolution of the Board of
Directors which shall be filed with the Warrant Agent, shall exceed fifteen
percent (15%));
(viii) Such shares of Common Stock as may become issuable
upon the exercise of any of the securities referred to in the paragraphs (i)
through (iv) above by reason of adjustments required pursuant to
anti-dilutions provisions applicable to such securities as in effect on the
date hereof, but only if and to the extent that such adjustments are required
as the result of the original issuance of the Warrants; or
(ix) Such shares of Common Stock as may become issuable upon
the exercise of any of the securities referred to in the paragraphs (i)
through (iv) above by reason of adjustments required pursuant to anti-dilution
provisions applicable to such securities as in effect on the date hereof, in
order to reflect any subdivision or combination of Common Stock, by
reclassification or otherwise, of any dividend on Common Stock payable in
Common Stock.
(f) Convertible Securities. If at any time after the Original
Issuance Date, GenTek shall in any manner issue or sell Convertible
Securities, other than, in any such case, upon a capital reorganization,
reclassification, consolidation or merger to which Section 4.01(c) applies,
whether or not the rights to exchange or convert thereunder are immediately
exercisable, and the consideration per share for the additional shares of
Common Stock which may at any time thereafter be issuable pursuant to the
terms of such Convertible Securities shall be less than the Current Market
Value per share, then the number of shares of Common Stock purchasable on the
exercise of each Tranche A Warrant shall be adjusted as provided in Section
4.01(e) hereof on the basis that (x) the maximum number of additional shares
of Common Stock necessary to effect the conversion or exchange of all such
Convertible Securities shall be deemed to have been issued as of the date of
the determination of the Current Market Value per share as herein provided and
(y) the aggregate consideration for such maximum number of additional shares
of Common Stock shall be deemed to be the minimum consideration received and
receivable by GenTek for the issuance of such additional shares of Common
Stock pursuant to the terms of such Convertible Securities.
For purposes of this Section 4.01(f), the adjustment shall be made
successively whenever any such issuance is made and the effective date of such
adjustment and the date as of which the Current Market Value per share shall
be computed shall be the earliest of (A) the date on which GenTek shall enter
into a firm contract or commitment for the issuance of such Convertible
Securities and (B) the date of actual issuance of such Convertible Securities,
provided that (A) no further adjustment shall be made upon the subsequent
issue or sale of shares of Common Stock upon the conversion or exchange of
such Convertible Securities, except in the case of any such Convertible
Securities which contain provisions requiring an adjustment, subsequent to the
date of the issue or sale thereof, of the number of shares of Common Stock
issuable upon the conversion or exchange of such Convertible Securities by
reason of (x) a change of control of GenTek, (y) the acquisition by and Person
or group of Persons of any specified number or percentage of the voting
securities of GenTek or (z) any similar event or occurrence, each such case to
be deemed hereunder to involve a separate issuance of shares of Common Stock,
or Convertible Securities, as the case may be; and (B) if such Convertible
Securities by their terms provide, with the passage of time or otherwise, for
any increase in the consideration payable to GenTek, or decrease in the number
of shares of Common Stock issuable, upon the exercise, conversion or exchange
thereof (by change of rate or otherwise), the number of shares of Common Stock
purchasable on the exercise of each Tranche A Warrant computed upon the
original issue, sale grant or assumption thereof, and any subsequent
adjustments based thereon, shall, upon any such increase or decrease becoming
effective, be recomputed to reflect such increase or decrease becoming
effective, be recomputed to reflect such increase or decrease insofar as it
affects the rights of conversion or exchange under such Convertible
Securities, which are outstanding at such time.
If all the Common Stock deliverable upon conversion or exchange of
such Convertible Securities has not been issued when such Convertible
Securities are no longer outstanding, then the number of shares of Common
Stock purchasable on the exercise of each Tranche A Warrant shall promptly be
readjusted to the number of shares of Common Stock purchasable on the exercise
of each Tranche A Warrant that would then be in effect had the adjustment upon
the issuance of such Convertible Securities been made on the basis of the
actual number of shares of Common Stock issued upon conversion or exchange of
such Convertible Securities.
This Section 4.01(f) does not apply to:
(i) Convertible Securities issued to shareholders of any
Person which merges into GenTek or with a subsidiary of GenTek, in proportion
to the stock holdings of such Person immediately prior to such merger, upon
such merger;
(ii) Convertible Securities issued in a bona fide public
offering pursuant to a firm commitment underwriting;
(iii) Convertible Securities issued in a bona fide private
placement through a placement agent or a bona fide private offering through
initial purchasers pursuant to an exemption from, or in transactions not
subject to, the registration requirements of the Exchange Act and applicable
state securities laws, where the placement agent or, as the case may be, each
of the initial purchasers is a member firm of the National Association of
Securities Dealers, Inc. (except to the extent that any discount from the
current market price attributable to restrictions on transferability of Common
Stock issuable upon conversion, as determined in good faith by the Board of
Directors and described in a resolution of the Board of Directors which shall
be filed with the Warrant Agent, shall exceed fifteen percent (15%)) or;
(iv) Convertible Securities (including, without limitation,
stock options) issued to GenTek's employees, consultants or directors under a
bona fide stock option or purchase plans or benefit plans adopted or assumed
by the Board or Directors or GenTek's compensation committee;
(v) any issuance of additional Convertible Securities for
which an appropriate adjustment is otherwise provided under Section 4.01
hereof;
(vi) Convertible Securities issuable upon the exercise of
rights or warrants issued to the holders of Common Stock for which appropriate
adjustment was previously made pursuant to Section 4.01(d).
(g) Deferral in Certain Circumstances. If the Corporation shall take
a record of the holders of its Common Stock for the purpose of entitling them
to receive a dividend or distribution, and shall thereafter, and before the
distribution to stockholders thereof, legally abandon its plan to pay or
deliver such dividend or distribution, then thereafter no adjustment in the
number of shares of Common Stock purchasable upon exercise of the Tranche A
Warrants or in the Exercise Price then in effect provided for by this Article
4 shall be required by reason of the taking of such record and, as to any
Tranche A Warrants that remain outstanding, any adjustment previously made in
respect thereof shall be rescinded and annulled. In any case in which the
provisions of this Article 4 shall require that an adjustment shall become
effective immediately after a record date of an event, the Corporation may
defer, until the occurrence of such event, issuing to the holder of any
Tranche A Warrant exercised after such record date and before the occurrence
of such event the shares of capital stock issuable upon such exercise by
reason of the adjustment required by such event and issuing to such holder
only the shares of capital stock issuable upon such exercise before giving
effect to such adjustments, and paying to such holder any amount in cash in
lieu of any fractional shares of capital stock pursuant to Section 4.05;
provided, however, that the Corporation shall deliver to such holder an
appropriate instrument or due xxxx evidencing such holder's right to receive
such additional shares and such cash on the date of the occurrence of such
event.
(h) De Minimis Adjustments. No adjustment in the number of shares of
Common Stock purchasable upon the exercise of any Tranche A Warrant shall be
required unless such adjustment would require an increase or decrease of at
least one percent in the number of shares of Common Stock purchasable upon the
exercise of such Tranche A Warrant; provided, however, that any adjustments
which are not required to be made by reason of this Section 4.01(h) shall be
carried forward and taken into account in any subsequent calculation and
adjustment. All calculations under this Section 4.01(h) shall be made to the
nearest one-thousandth of a share.
(i) Other Adjustments. In addition to the foregoing adjustments
required by Sections 4(a), (b), (c), (d), (e) or (f), GenTek may make such
reductions in the Exercise Price as it may, in good faith, deem advisable in
order that any event treated for Federal income tax purposes as a dividend of
stock or stock rights shall not be taxable to the recipients.
(j) Determination of Current Market Value and Related Deliveries. If
at any time the Current Market Value of any security is required to be
calculated pursuant to the terms of this Agreement, the determination of such
Current Market Value by GenTek, if calculated in accordance with the terms of
this Agreement, absent manifest error, shall be conclusive and binding on all
Persons. If at any time the Current Market Value of any security is required
to be calculated pursuant to the terms of this Agreement, and such Current
Market Value is determined as if such security is not registered under the
Exchange Act, GenTek shall, upon the request of Holders of at least 10% of the
warrants outstanding at the time of such request, deliver to the Warrant Agent
a report of an Independent Financial Expert specifying the amount of such
Current Market Value as determined by such Independent Financial Expert and
containing a brief description of the factors on which such determination was
based. The Warrant Agent shall have no duty with respect to any such report,
except to keep it on file and available for inspection by the Holders.
(k) Tranche A Warrant Price Adjustment. Whenever the number of shares
of Common Stock into which a Tranche A Warrant is exercisable is adjusted as
provided in Sections 4.01(a), (b), (c), (d), (e) or (f), the Exercise Price
payable upon exercise of the Tranche A Warrant shall simultaneously be
adjusted by multiplying such Exercise Price immediately prior to such
adjustment by a fraction, the numerator of which shall be the number of shares
of Common Stock into which such Tranche A Warrant was exercisable immediately
prior to such adjustment, and the denominator of which shall be the number of
shares of Common Stock into which such Tranche A Warrant was exercisable
immediately thereafter.
(l) Covenants. GenTek will not, by amendment of its certificate of
incorporation or through any consolidation, merger, reorganization, transfer
of assets, dissolution, issue or sale of securities or any other voluntary
action, avoid or seek to avoid the observance or performance of any of the
terms of this Agreement, but will at all times in good faith carry out the
terms of this Agreement. Without limiting the generality of the foregoing,
GenTek (i) will take all such action as may be necessary or appropriate in
order that GenTek may validly and legally issue fully paid and nonassessable
shares of Common Stock on the exercise of the Tranche A Warrants from time to
time outstanding, (ii) will not take any action which results in any
adjustments hereunder if the total number of shares of Common Stock issuable
after the action upon the exercise of all of the Tranche A Warrants would
exceed the total number of shares of Common Stock authorized by GenTek's
certificate of incorporation and available for the purposes of issue upon such
exercise and (iii) may pursue and consummate bona fide transactions so long as
the primary purpose of such transactions is not to avoid any of the terms of
this Agreement. A consolidation, merger, reorganization or transfer of assets
involving GenTek covered by Section 4.01(c) shall not be prohibited by or
require any adjustment under this Section 4.01(l).
Section 4.02.Notice of Adjustment. Whenever the number of shares
of Common Stock or other stock or property purchasable upon the exercise of
each Tranche A Warrant is required to be adjusted pursuant to Section 4.01,
GenTek shall, within thirty (30) days thereafter, deliver to the Warrant Agent
a certificate setting forth (a) the number of shares of Common Stock or other
stock or property purchasable upon the exercise of each Tranche A Warrant and
the Exercise Price therefor after such adjustment, (b) a brief statement of
the facts requiring such adjustment and (c) the computation by which such
adjustment was made. Such certificate shall be conclusive evidence of the
correctness of such adjustment absent manifest error. The Warrant Agent shall
not be deemed to have knowledge of such adjustment unless and until it shall
have received such certificate. Upon receipt of such certificate, the Warrant
Agent shall, within fifteen (15) days of receipt, mail notice of the
adjustment described in such certificate to each Holder at the expense of
GenTek. The Warrant Agent shall be entitled to rely on such certificate and
shall be under no duty or responsibility with respect to any such certificate,
except to exhibit the same, from time to time, to any Holder desiring to
inspect such certificate during reasonable business hours. The Warrant Agent
shall not at any time be under any duty or responsibility to any Holder to
determine whether any facts exist which may require any adjustment of the
Exercise Price or the number of shares of Common Stock or other securities or
property purchasable upon exercise of any Tranche A Warrant, or with respect
to the nature or extent of any such adjustment when made, or with respect to
the method employed in making such adjustment, or the validity or value (or
the kind or amount) of any shares of Common Stock or other securities or
property which may be purchasable on exercise of any Tranche A Warrant. The
Warrant Agent shall not be responsible for any failure of GenTek to make any
cash payment or to issue, transfer or deliver any shares of Common Stock or
other securities or property upon the exercise of any Tranche A Warrant.
Section 4.03.Statement on Tranche A Warrants. The form of
Warrant Certificate need not be changed because of any adjustment made
pursuant to Section 4.01, and Warrant Certificates issued after such
adjustment may state the same Exercise Price and the same number and kind of
shares of Common Stock as are stated in the Warrant Certificates initially
issued pursuant to this Agreement. GenTek may, however, at any time in its
sole discretion (which shall be conclusive), make any change in the form of
Warrant Certificate that it may deem appropriate to reflect any such
adjustment and that does not affect the substance thereof and any Warrant
Certificate thereafter issued or countersigned, whether in exchange or
substitution for an outstanding Warrant Certificate or otherwise, may be in
the form so changed.
Section 4.04.Notice of Consolidation, Merger or Sale of
Substantially All Assets, Etc. In the event that, at any time after the date
hereof and prior to 5:00 p.m., New York City time, on the Expiration Date, (a)
GenTek shall consolidate with, merge with or into or sell, transfer or
otherwise dispose of all or substantially all of its properties, assets or
business (except a merger in which GenTek is the surviving corporation and the
holders of Common Stock (or other securities or property purchasable upon
exercise of the Tranche A Warrants) receive no consideration in respect of
their shares) or (b) GenTek shall dissolve, liquidate or wind-up its
operations, then in any one or more of such cases, GenTek shall cause to be
mailed to the Warrant Agent and each Holder, at the earliest practicable time
(and, in any event, not less than 20 calendar days before any record date or,
if no record date applies, before any date set for definitive action), notice
of the date on which such consolidation, merger, sale, dissolution,
liquidation or winding up shall take place, as the case may be. Such notice
shall also set forth such facts as shall indicate the effect of such action
(to the extent such effect may be known at the date of such notice) on the
kind and amount of shares of Common Stock and other securities, money and
other property deliverable upon exercise of the Tranche A Warrants. Such
notice shall also specify the date or expected date as of which the holders of
record of shares of Common Stock or other securities or property issuable upon
exercise of the Tranche A Warrants shall be entitled to exchange their shares
for securities, money or other property deliverable upon such consolidation,
merger, sale, dissolution, liquidation or winding up, as the case may be.
Without limiting the foregoing, GenTek shall cause to be mailed to the Warrant
Agent at the earliest practicable time: (i) notice that a definitive agreement
relating to a Communications Acquisition Transaction has been entered into;
(ii) notice of consummation of a Communications Acquisition Transaction, the
amount of the payment to be made to Holders pursuant to Section 4.06, as well
as the method and formula for calculating such amount; and (iii) to the extent
applicable, notice of termination of a definitive agreement relating to a
Communications Acquisition Transaction. The failure to deliver notice as
required by this Section 4.04 or any defect therein shall not affect the
legality or validity of any warrant or any consolidation, merger, sale,
dissolution, liquidation or winding up or any other action taken in connection
therewith.
Section 4.05.Fractional Interests. Notwithstanding anything to
the contrary contained in this Agreement, if the number of shares of Common
Stock purchasable on the exercise of each Tranche A Warrant is adjusted
pursuant to the provisions of Section 4.01, GenTek shall not be required to
issue any fraction of a share of Common Stock or to distribute a certificate
that evidences a fraction of a share of Common Stock upon any subsequent
exercise of any Tranche A Warrant. If Warrant Certificates evidencing more
than one Tranche A Warrant shall be surrendered for exercise at the same time
by the same Holder, the number of full shares of Common Stock which shall be
issuable upon such exercise thereof shall be computed on the basis of the
aggregate number of Tranche A Warrants evidenced by Warrant Certificates so
surrendered. If any fraction of a share of Common Stock would, except for the
provisions of this Section 4.05, be issuable on the exercise of any Tranche A
Warrant (or specified portion thereof), in lieu of the issuance of such
fractional share, GenTek shall pay the Holder of such Tranche A Warrant an
amount in cash equal to the then Current Market Value per share of Common
Stock multiplied by such fraction (computed to the nearest whole cent). The
Holders, by their acceptance of the Warrant Certificates, expressly waive
their right to receive any fraction of a share of Common Stock or a stock
certificate representing a fraction of a share of Common Stock instead of such
cash.
Section 0.00.Xxxx of Communications Business. If, prior to the
Expiration Date, GenTek enters into a definitive agreement providing for a
Communications Acquisition Transaction and such Communications Acquisition
Transaction is consummated no later than 120 days following the Expiration
Date, each holder of a Tranche A Warrants shall receive for each warrant
(unless such holder and the Acquiror agree otherwise) cash, equal to either
(i) the Black Scholes Value or (ii) if GenTek's common stock is not listed on
an exchange, NASDAQ or any of its affiliates, or quoted on the over the
counter bulletin board run by NASDAQ, the Unlisted Black Scholes Valuation,
provided that no such payment shall be required in respect of any Tranche A
Warrant which has been exercised prior to the time on which payment pursuant
to this Section 4.06 is made. Such payments shall be made within 60 days
following the consummation of such Communications Acquisition Transaction to
Holders of record of the Tranche A Warrants on such closing date.
Notwithstanding the foregoing, GenTek will not be required to make a payment
pursuant to this Section 4.06 in the event such payment would violate the
provisions of any debt instrument to which GenTek is a party. In the event of
such a limitation on payment, GenTek will use its best efforts to cause such
limitation to be waived as promptly as practicable.
Section 4.07 Concerning All Adjustments. Notwithstanding
anything to the contrary contained in this Agreement, if an adjustment is made
under any provision of Article IV on account of any event, transaction,
circumstance, condition or happening, no additional adjustment shall be made
under any other provision of Article IV on account of such event, transaction,
circumstance, condition or happening. Unless otherwise expressly provided in
this Article IV, all determinations and calculations required or permitted
under this Article IV shall be made by GenTek or its Board of Directors, as
appropriate, and all such calculations and determinations shall be conclusive
and binding in the absence of manifest error.
ARTICLE V
Loss, Theft, Destruction Or Mutilation of Warrant Certificates
--------------------------------------------------------------
Upon receipt by GenTek and the Warrant Agent of evidence
reasonably satisfactory to them of the ownership and the loss, theft,
destruction or mutilation of any Warrant Certificate, and, if requested, an
indemnity bond in form and amount and with corporate surety satisfactory to
them that is customary, and (in the case of mutilation) upon surrender and
cancellation thereof, then, in the absence of notice to GenTek or the Warrant
Agent that the Tranche A Warrants represented thereby have been acquired by a
bona fide purchaser, GenTek shall issue and the Warrant Agent shall
countersign and deliver to the Holder of the lost, stolen, destroyed or
mutilated Warrant Certificate, in exchange and substitution for or in lieu
thereof, a new Warrant Certificate of the same tenor and representing an
equivalent number of Tranche A Warrants. Upon the issuance of any new Warrant
Certificate under this Article V, GenTek may require the payment of a sum
sufficient to cover any tax or other reasonable governmental charge that may
be imposed in relation thereto and other expenses (including the reasonable
fees and expenses of the Warrant Agent) in connection therewith. Every new
Warrant Certificate executed and delivered pursuant to this Article V in lieu
of any lost, stolen, destroyed or mutilated Warrant Certificate shall
constitute an original contractual obligation of GenTek, whether or not the
allegedly lost, stolen, destroyed or mutilated Warrant Certificates shall be
at any time enforceable by anyone, and shall be entitled to the benefits of
this Agreement equally and proportionately with any and all other Warrant
Certificates duly executed and delivered hereunder. The provisions of this
Article V are exclusive and shall preclude (to the extent lawful) all other
rights or remedies with respect to the replacement of lost, stolen, destroyed
or mutilated Warrant Certificates.
ARTICLE VI
Authorization and Reservation
of Common Stock; Purchase of Tranche A Warrants
-----------------------------------------------
Section 6.01. Reservation of Authorized Common Stock. GenTek
shall at all times reserve and keep available for issue upon the exercise of
Tranche A Warrants, such number of its authorized but unissued shares of
Common Stock or other securities deliverable upon exercise of Tranche A
Warrants as will be sufficient to permit the exercise in full of all
outstanding Tranche A Warrants and shall take all action required to increase
the authorized number of shares of Common Stock if necessary to permit the
conversion of all outstanding Tranche A Warrants. Before taking any action
that would cause an adjustment pursuant to Section 4.01 reducing the Exercise
Price below the then par value, if any, of any of the shares of Common Stock
into which the Tranche A Warrants are exercisable, GenTek will take any
corporate action that may be necessary in order that GenTek may validly and
legally issue fully paid and non-assessable shares of such Common Stock at
such adjusted Exercise Price. GenTek will cause appropriate evidence of
ownership of such Common Stock or other securities to be delivered to the
Warrant Agent upon its request for delivery upon the exercise of Tranche A
Warrants, and all such shares of Common Stock will, at all times, be duly
approved for listing subject to official notice of issuance on each securities
exchange, interdealer quotation system or market, if any, on which such Common
Stock is then listed. GenTek covenants that all Common Stock or other
securities that may be issued upon the exercise of the Tranche A Warrants
will, upon issuance, be duly authorized, validly issued, fully paid and
non-assessable, and free from preemptive rights and all taxes, liens, charges,
encumbrances and security interests.
Section 6.02.Purchase of Tranche A Warrants by GenTek. GenTek
shall have the right, except as limited by law or other agreement, to purchase
or otherwise acquire Tranche A Warrants at such times, in such manner and for
such consideration as it and the selling Holder of Tranche A Warrants may deem
appropriate. In the event GenTek shall purchase or otherwise acquire Tranche A
Warrants, the related Warrant Certificates shall thereupon be delivered to the
Warrant Agent for cancellation; provided, however, that unless and until the
Warrant Certificates evidencing such Tranche A Warrants are surrendered by
GenTek to the Warrant Agent for cancellation, such purchase or acquisition
shall not operate as a redemption or termination of the right represented by
such Tranche A Warrants. Any Tranche A Warrants purchased or otherwise
acquired by GenTek shall not be outstanding for any purpose.
ARTICLE VII
Tranche A Warrant Holders Not Deemed Stockholders
-------------------------------------------------
Prior to the exercise of any Tranche A Warrant, nothing
contained in this Agreement or any Warrant Certificate shall be construed as
conferring on the Holder of any Tranche A Warrant or Warrant Certificate any
rights whatsoever as a stockholder of GenTek, either at law or in equity,
including the right to vote or to consent to any action of the stockholders,
to receive dividends or other distributions, to exercise any preemptive right
or to receive any notice of meetings of stockholders and, except as otherwise
provided in this Agreement, shall not be entitled to receive any notice of any
proceedings of GenTek.
ARTICLE VIII
The Warrant Agent
-----------------
Section 8.01.Appointment and Acceptance of Agency. GenTek hereby
appoints the Warrant Agent to act as agent for GenTek in accordance with the
instructions set forth in this Agreement and the Warrant Agent hereby accepts
the agency established by this Agreement and agrees to perform the same on the
terms and conditions herein set forth.
Section 8.02.Correctness of Statements; Distribution of Tranche
A Warrants. The statements contained herein and in each Warrant Certificate
shall be taken as statements of GenTek, and the Warrant Agent assumes no
responsibility for the correctness of any of the same except as describe the
Warrant Agent or any action taken by it. The Warrant Agent assumes no
responsibility with respect to the distribution of the Tranche A Warrants
except as herein otherwise provided.
Section 8.03.Use of Agents. The Warrant Agent may execute and
exercise any of the rights or powers hereby vested in it or perform any duty
thereunder either itself (through its employees) or by or through its
attorneys or agents (which shall not include its employees) and shall not be
responsible for the misconduct or negligence of any agent appointed, provided
that due care had been exercised in the appointment and continued employment
thereof.
Section 8.04.Proof of Actions Taken. Whenever in the performance
of its duties under this Agreement, the Warrant Agent shall deem it necessary
or desirable that any fact or matter be proved or established by GenTek prior
to taking or suffering any action hereunder, such fact or matter (unless such
evidence in respect thereof be herein specifically prescribed) may, in the
absence of bad faith on the part of the Warrant Agent, be deemed to be
conclusively proved and established by a certificate signed by the Chairman of
the Board, President, Chief Executive Officer, Chief Financial Officer, any
Vice President, the Treasurer or Secretary of GenTek and delivered to the
Warrant Agent; and such certificate, in the absence of bad faith on the part
of the Warrant Agent, shall be full authorization to the Warrant Agent for any
action taken, suffered or omitted by it under the provisions of this Agreement
in reliance upon such certificate.
Section 8.05.Compensation; Indemnity. GenTek agrees to pay the
Warrant Agent compensation for all services rendered by the Warrant Agent in
the performance of its duties under this Agreement. GenTek agrees to reimburse
the Warrant Agent for all reasonable expenses, taxes and governmental charges
and other charges of any kind and nature incurred by the Warrant Agent
(including reasonable fees and expenses of the Warrant Agent's counsel and
agents) in the performance of its duties under this Agreement. GenTek also
agrees to indemnify the Warrant Agent for, and to hold it harmless against,
any loss, liability or expenses incurred without negligence or willful
misconduct on the part of the Warrant Agent, for anything done or omitted by
the Warrant Agent in connection with the acceptance and administration of this
Agreement, including the costs and expenses of defending against any claim of
liability in the premises. The indemnity provided for herein shall survive the
expiration of the Tranche A Warrants and the termination of this Agreement.
The costs and expenses incurred in enforcing this right of indemnification
shall be paid by GenTek. Notwithstanding anything in this Agreement to the
contrary, in no event shall the Warrant Agent be liable for special, indirect
or consequential loss or damage of any kind whatsoever (including lost
profits), even if the Warrant Agent has been advised of the likelihood of such
loss or damage and regardless of the form of the action. The provisions of
this Section 8.05 shall survive the termination of this Agreement, the
exercise or expiration of the Tranche A Warrants, and the resignation,
replacement or removal of the Warrant Agent.
Section 0.00.Xxxxx Proceedings. The Warrant Agent shall be under
no obligation to institute any action, suit or legal proceeding or to take any
other action likely to involve expense unless GenTek or one or more Holders
shall furnish the Warrant Agent with reasonable security and indemnity
satisfactory to the Warrant Agent for any costs and expenses which may be
incurred, but this provision shall not affect the power of the Warrant Agent
to take such action as the Warrant Agent may consider proper, whether with or
without any such security or indemnity. All rights of action under this
Agreement or under any of the Tranche A Warrants may be enforced by the
Warrant Agent without the possession of any of the Tranche A Warrants or the
production thereof at any trial or other proceeding relative thereto, and any
such action, suit or proceeding instituted by the Warrant Agent shall be
brought in its name as Warrant Agent, and any recovery of judgment shall be
for the ratable benefit of the Holders, as their respective rights or
interests may appear.
Section 8.07.Other Transactions Involving GenTek. The Warrant
Agent and any stockholder, director, officer or employee of the Warrant Agent
may buy, sell or deal in any of the Tranche A Warrants or other securities of
GenTek or become pecuniarily interested in any transactions in which GenTek
may be interested, or contract with or lend money to GenTek or otherwise act
as fully and freely as though it were not Warrant Agent under this Agreement
or such director, officer or employee of the Warrant Agent. Nothing herein
shall preclude the Warrant Agent from acting in any other capacity for GenTek
or for any other legal entity including acting as transfer agent or as a
lender to GenTek or an affiliate thereof.
Section 8.08.Actions as Agent. The Warrant Agent shall act
hereunder solely as agent, and its duties shall be determined solely by the
provisions of this Agreement. No implied duties or obligations shall be read
into this Agreement against the Warrant Agent. The Warrant Agent shall not be
liable for anything which it may do or refrain from doing in connection with
this Agreement except for its own negligence or willful misconduct.
Section 8.09.Liability of Warrant Agent. The Warrant Agent may
conclusively rely upon and shall be protected by GenTek and shall not incur
any liability or responsibility to GenTek or to any Holder for or in respect
of any action taken, suffered or omitted by it (a) in connection with its
administration of this Agreement or (b) in reliance on any Warrant Certificate
or certificate for shares of stock or other securities of GenTek, instrument
of assignment or transfer, power of attorney, endorsement, affidavit, letter,
direction, statement, notice, resolution, waiver, consent, order, certificate
or other paper, document or instrument reasonably believed by it to be genuine
and to have been signed, executed, sent, presented and, where necessary,
verified or acknowledged, by the proper party or parties, except liabilities
arising out of the Warrant Agent's own gross negligence or willful misconduct.
Section 8.10.Validity of Agreement. The Warrant Agent shall not
be under any responsibility in respect of the validity of this Agreement or
the execution and delivery hereof (except the due execution and delivery
hereof by the Warrant Agent) or in respect of the validity or execution of any
Tranche A Warrant (except its counter-signature thereof); nor shall it be
responsible for any breach by GenTek of any covenant or condition contained in
this Agreement or in any Warrant Certificate; nor shall the Warrant Agent by
any act hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any underlying securities (or other stock) to
be issued pursuant to this Agreement or any Tranche A Warrant, or as to
whether any underlying securities (or other stock) will, when issued, be
validly issued, fully paid and non-assessable, or as to the Exercise Price or
the number or amount of underlying securities or other securities or other
property issuable upon exercise of any Tranche A Warrant.
Section 8.11.Acceptance of Instructions. The Warrant Agent is
hereby authorized and directed to accept instructions with respect to the
performance of its duties hereunder from the Chairman of the Board, President,
Chief Executive Officer, Chief Financial Officer, any Vice President, the
Treasurer or Secretary of GenTek, and to apply to such officers for advice or
instructions in connection with its duties, and shall not be liable for any
action taken or suffered by it in good faith in accordance with instructions
of any such officer or officers or for any delay in acting while waiting for
those instructions. Any application by the Warrant Agent for written
instructions from GenTek may, at the option of the Warrant Agent, set forth in
writing any action proposed to be taken or omitted by the Warrant Agent under
this Agreement and the date on or after which such action shall be taken or
such omission shall be effective. The Warrant Agent shall not be liable for
any action taken by, or omission of, the Warrant Agent in accordance with a
proposal included in any such application on or after the date specified in
such application (which date shall not be less than 10 Business Days after the
date any officer of GenTek actually receives such application, unless any such
officer shall have consented in writing to an earlier date) unless prior to
taking any such action (or the effective date in the case of an omission), the
Warrant Agent shall have received written instructions in response to such
application subject to the proposed action or omission and/or specifying the
action to be taken or omitted.
Section 8.12.Right to Consult and Rely Upon Counsel. Before the
Warrant Agent acts or refrains from acting, it may at any time consult with
legal counsel (who may be legal counsel for GenTek), and the opinion or advice
of such counsel shall be full and complete authorization and protection to the
Warrant Agent and the Warrant Agent shall incur no liability or responsibility
to GenTek or to any Holder for any action taken, suffered or omitted by it in
good faith in accordance with the opinion or advice of such counsel.
Section 8.13.Change of Warrant Agent. (a) The Warrant Agent, or
any successor to it hereafter appointed, may resign from its position as such
and be discharged from all further duties and liabilities hereunder (except
liabilities arising as a result of the Warrant Agent's own gross negligence or
willful misconduct), after giving 30 calendar days' prior written notice to
GenTek, upon (but only upon) a duly appointed successor Warrant Agent having
been appointed and having accepted such appointment in writing. GenTek may
remove the Warrant Agent upon not less than 30 calendar days' prior written
notice specifying the date when such discharge shall take effect, and the
Warrant Agent shall thereupon in like manner be discharged from all further
duties and liabilities hereunder (except liabilities arising as a result of
the Warrant Agent's own gross negligence or willful misconduct), upon (but
only upon) a duly appointed successor Warrant Agent having been appointed and
having accepted such appointment in writing. GenTek shall cause to be mailed,
at the expense of GenTek, to each Holder a copy of said notice of resignation
or notice of removal, as the case may be. Upon such resignation or removal
GenTek shall appoint in writing a successor to the Warrant Agent. If GenTek
shall fail to make such appointment within a period of 30 calendar days after
it has been notified in writing of such resignation by the resigning Warrant
Agent or after such removal, then the existing Warrant Agent or the Holder of
any Tranche A Warrant may apply to any court of competent jurisdiction for the
appointment of a successor to the Warrant Agent. Pending appointment of a
successor to the original Warrant Agent, either by GenTek or by such a court,
the duties of the Warrant Agent shall be carried out by GenTek.
(b) Any successor to the Warrant Agent, whether appointed by
GenTek or by a court, shall be a bank (or subsidiary thereof) or trust company
doing business under the laws of the United States or any state thereof, in
good standing and having a combined capital and surplus of not less than
$50,000,000. The combined capital and surplus of any such successor to the
Warrant Agent shall be deemed to be the combined capital and surplus as set
forth in the most recent annual report of its condition published by such
successor to the Warrant Agent prior to its appointment; provided that such
reports are published at least annually pursuant to law or to the requirements
of a federal or state supervising or examining authority. After acceptance in
writing of such appointment by the successor to the Warrant Agent, it shall be
vested with the same authority, powers, rights, immunities, duties and
responsibilities as its predecessor Warrant Agent, without any further
assurance, conveyance, act or deed; provided, however, the predecessor Warrant
Agent shall in all events deliver and transfer to the successor Warrant Agent
all property, if any, at the time held hereunder by the predecessor Warrant
Agent and if for any reason it shall be necessary or expedient to execute and
deliver any further assurance, conveyance, act or deed, the same shall be done
at the expense of GenTek and shall be legally and validly executed and
delivered by the resigning or removed Warrant Agent. As soon as practicable
after such appointment, GenTek shall give notice thereof to the predecessor
Warrant Agent and the Holders. Failure to give any notice provided for in this
Section 8.13, however, or any defect therein, shall not affect the legality or
validity of the resignation or removal of the Warrant Agent or the appointment
of the successor Warrant Agent, as the case may be.
Section 8.14.Successor Warrant Agent. Any corporation into which
the Warrant Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Warrant
Agent shall be a party, shall be the successor Warrant Agent under this
Agreement without any further act; provided, however, that such corporation
would be eligible for appointment as a successor to the Warrant Agent under
the provisions of Section 8.13 hereof. Any such successor Warrant Agent shall
promptly cause notice of its succession as Warrant Agent to be mailed to
GenTek and the Holders.
Section 8.15.Other. (a) No provision of this Agreement shall
require the Warrant Agent to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties hereunder or
in the exercise of its rights if there shall be reasonable grounds for
believing that repayment of such funds or adequate indemnification against
such risk or liability is not reasonably assured to it.
(b) The Warrant Agent shall not be required to take notice or be
deemed to have notice of any fact, event or determination (including any dates
or events defined in this Agreement or the designation of any Person as an
acquiring Person or Affiliate) under this Agreement unless and until the
Warrant Agent shall be specifically notified in writing by GenTek of such
fact, event or determination.
ARTICLE IX
Miscellaneous
-------------
Section 0.00.Xxxxx Deposited with the Warrant Agent. The Warrant
Agent shall not be required to pay interest on any moneys deposited pursuant
to the provisions of this Agreement, except such as it shall agree in writing
with GenTek to pay thereon. Any moneys, securities or other property which at
any time shall be deposited by GenTek or on its behalf with the Warrant Agent
pursuant to this Agreement shall be and are hereby assigned, transferred and
set over to the Warrant Agent in trust for the purpose for which such moneys,
securities or other property shall have been deposited; but such moneys,
securities or other property need not be segregated from other funds,
securities or other property except to the extent required by law.
Section 9.02.Payment of Taxes. (a) GenTek will pay all
documentary stamp taxes and other governmental charges required by law
attributable to the initial issuance of the Warrant Certificates and of the
shares issuable upon the exercise of Tranche A Warrants; provided, however,
that GenTek shall not be required to pay any tax or other charges which may be
payable in respect of any transfer involved in the issue of any Warrant
Certificates or any certificates for shares of Common Stock in a name other
than that of the registered holder of a Warrant Certificate surrendered upon
transfer, exchange or exercise of a Tranche A Warrant represented thereby. In
any such case, GenTek shall not be required to issue or deliver such Warrant
Certificates or certificates for shares of Common Stock unless or until the
Person or Persons requesting the issuance thereof shall have paid to GenTek
the amount of such tax or shall have established to the satisfaction of GenTek
and the Warrant Agent that such tax has been paid.
(b) GenTek is authorized to withhold from all payments made to
holders of the Tranche A Warrants pursuant to Section 4.06 and to pay to a
federal, foreign, state or local government, any amounts required to be
withheld pursuant to the Internal Revenue Code of 1986, as amended, or any
provisions of any other federal, foreign, state or local law. Any amounts so
withheld and timely paid to an applicable federal, foreign, state or local
government shall be treated as having been paid to such holder of Tranche A
Warrants for all purposes of this Agreement. Any such holder that is entitled
to an exemption from or reduction of withholding tax pursuant to any treaty or
otherwise, with respect to payments made pursuant to this Agreement shall
deliver to GenTek such properly completed and executed documentation
prescribed by applicable law or reasonably requested by GenTek as will permit
such payments to be made without withholding or at a reduced rate.
Section 9.03.Merger, Consolidation or Sale of Assets of GenTek.
GenTek will not merge into or consolidate with any other Person, or sell or
otherwise transfer all or substantially all of its property, assets or
business to any Person (other than a merger, consolidation or sale
contemplated by 4.01(c) hereof in which the consideration payable to the
holders of shares of Common Stock in exchange for their shares consists solely
of cash in which case each Holder of a Tranche A Warrant, without having to
take any other action than the surrendering of such Tranche A Warrant to such
Person, GenTek or the Warrant Agent shall receive an amount equal to the
amount (if any) by which the price per share payable to, or which would be
received by, any holder of Common Stock in connection with such transaction
exceeds the Exercise Price effective at that time), unless prior to or
simultaneously with the consummation thereof, the Person resulting from such
merger or consolidation, or transferee of such property, assets or business,
as the case may be, executes with the Warrant Agent a supplemental agreement
providing for the express assumption by such Person of the due and punctual
performance and observance of each and every covenant and condition of this
Agreement to be performed and observed by GenTek.
Section 9.04.Notices. (a) Any notice, request, demand or report
(each, a "Communication") required or permitted to be given or made by this
Agreement shall be in writing
(b) Any Communication authorized by this Agreement to be given
or made by the Warrant Agent or by any Holder to or on GenTek shall be
sufficiently given or made if sent by registered or certified mail and shall
be deemed given upon receipt, addressed (until another address is filed by
GenTek with the Warrant Agent) as follows:
GenTek Inc.
00 Xxxx Xxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel, Treasurer
Facsimile No.: (000) 000-0000
(c) Any Communication authorized by this Agreement to be given
or made by GenTek or by any Holder to or on the Warrant Agent shall be
sufficiently given or made if sent by registered or certified mail, or by
facsimile or electronic mail, and shall be deemed given upon receipt,
addressed (until another address is filed by the Warrant Agent with GenTek) as
follows:
Xxxxx Fargo Bank Minnesota, N.A.
Shareowner Services
Attn: Account Management
000 X. Xxxxxxx Xxxxxxxx
Xxxxx Xx. Xxxx, XX 00000
(d) Any Communication authorized by this Agreement to be given
or made by GenTek or the Warrant Agent to any Holder shall be sufficiently
given or made if sent by first-class mail, postage prepaid, or by facsimile or
electronic mail, addressed to such Holder at the address of such Holder as
shown on the registry books of GenTek. GenTek shall deliver a copy of any
notice or demand it delivers to any Holder to the Warrant Agent and the
Warrant Agent shall deliver a copy of any notice or demand it delivers to any
Holder to GenTek.
Section 9.05.Governing Law. THE VALIDITY, INTERPRETATION AND
PERFORMANCE OF THIS AGREEMENT AND THE WARRANT CERTIFICATES SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 9.06.Binding Effect. This Agreement shall be binding
upon and inure to the benefit of GenTek and the Warrant Agent and their
respective successors and assigns, and the Holders from time to time of the
Tranche A Warrants. Nothing in this Agreement is intended or shall be
construed to confer upon any Person, other than GenTek, the Warrant Agent and
the Holders of the Tranche A Warrants, any right, remedy or claim under or by
reason of this Agreement or any part hereof.
Section 9.07.Counterparts. This Agreement may be executed
manually or by facsimile in any number of counterparts, each of which shall be
deemed an original, but all of which together constitute one and the same
instrument.
Section 9.08.Supplements or Amendments. (a) The Warrant Agent
may, without the consent or concurrence of the Holders, enter into one or more
supplemental agreements or amendments with GenTek for the purpose of (i)
evidencing the rights of the Holders upon consolidation, merger, sale,
transfer, reclassification, liquidation or dissolution, (ii) making any
changes or corrections in this Agreement that are required to cure any
ambiguity, to correct or supplement any provision contained herein that may be
defective or inconsistent with any other provision herein or any clerical
omission or mistake or manifest error herein contained, (iii) making such
other provisions in regard to matters or questions arising under this
Agreement as shall not adversely affect the interest of the Holders in any
material respect or be inconsistent with this Agreement or any supplemental
agreement or amendment or (iv) adding further covenants and agreements of
GenTek in this Agreement or surrendering any rights or power reserved to or
conferred upon GenTek in this Agreement.
(b) With the consent of the Holders of Warrant Certificates
evidencing at least a majority in number of the Tranche A Warrants at the time
outstanding, GenTek and the Tranche A Warrant Agent may at any time and from
time to time by supplemental agreement or amendment add any provisions to or
change in any manner or eliminate any of the provisions of this Agreement or
of any supplemental agreement or modify in any manner the rights and
obligations of the Holders and GenTek; provided, however, that no such
supplemental agreement or amendment shall, without the consent of the Holder
of the Warrant Certificate evidencing each outstanding Tranche A Warrant
affected thereby, (i) alter the provisions of this Agreement so as to
adversely affect in any material respect the terms upon which Tranche A
Warrants are exercisable, (ii) decrease the number of underlying securities or
the increase in the Exercise Price (other than pursuant to adjustments made in
accordance with Article IV hereof) or (iii) amend the provisions of Section
9.08. Notwithstanding anything to the contrary contained in this Agreement, no
supplement agreement or amendment that changes the rights and duties of the
Warrant Agent under this Agreement shall be effective against the Warrant
Agent without the written consent of the Warrant Agent.
Section 9.09.Third Party Beneficiaries. The Holders shall be the
sole third party beneficiaries to the agreements made hereunder between
GenTek, on the one hand, and the Warrant Agent, on the other hand, and each
Holder shall have the right to enforce such agreements directly to the extent
it deems such enforcement necessary or advisable to protect its rights or the
rights of Holders hereunder. Nothing in this Agreement shall be construed to
give to any person or corporation other than GenTek, the Warrant Agent and the
Holders any legal or equitable right, remedy or claim under this agreement.
Section 9.10.Waivers. GenTek may take any action herein
prohibited, or omit to perform any act herein required to be performed by it,
only if (i) GenTek has obtained the written consent of Holders of Warrant
Certificates evidencing a majority of the then outstanding Tranche A Warrants,
and (ii) any consent required pursuant to Section 9.08 has been obtained.
Section 9.11.Board Seat. No later than 120 days following the
first date on which a majority of the Tranche A Warrants shall have been
validly exercised, the Board of Directors of GenTek shall expand the Board of
Directors of GenTek to create two vacancies for newly created seats and shall
elect to such two vacancies: one (1) director designated by the Creditors
Committee Designee (as defined in the Plan) that is reasonably acceptable to
the other directors then serving on the Board of Directors of GenTek and one
(1) director designated by the Board of Directors of GenTek.
Section 9.12 Inspection. The Warrant Agent shall cause a copy of
this Agreement to be available at all reasonable times at the office of the
Warrant Agent for inspection by the Holder of any Warrant Certificate. The
Warrant Agent may require such Holder to submit his Warrant Certificate for
inspection by it.
Section 9.13.Headings. The descriptive headings of the several
Sections of this Agreement are inserted for convenience and shall not control
or affect the meaning or construction of any of the provisions hereof.
Section 9.14.Entire Agreement. This Agreement sets forth the
entire agreement of the parties hereto as to the subject matter hereof and
supersedes all previous, agreements among all or some of the parties hereto
with respect thereto, whether written, oral or otherwise.
Section 9.15.Termination. This Agreement shall terminate on the
Expiration Date. Notwithstanding the foregoing, this Agreement will terminate
on any earlier date when all Tranche A Warrants have been exercised or
redeemed. The provisions of Section 8.05 shall survive such termination.
[signatures follow]
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed, as of the day and year first above written.
GENTEK INC.
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------
Printed Name: Xxxxxxx X. Xxxxx
Title: Vice President, Chief
Financial Officer and
Assistant Treasurer
XXXXX FARGO BANK MINNESOTA, N.A.
as Warrant Agent
By: /s/ Xxxxxxxx Xxxxxxxx
------------------------------
Officer
EXHIBIT A
Form of Warrant Certificate
---------------------------
GENTEK INC.
No.________________ ___________ Tranche A Warrants
TRANCHE A WARRANTS TO PURCHASE COMMON STOCK
This certifies that , or its registered assigns, is the owner of
the number of Tranche A Warrants set forth above, each of which represents the
right to purchase from GENTEK INC., a Delaware corporation ("GenTek"), one
share of the common stock, no par value per share (the "Common Stock"), of
GenTek (the Common Stock issuable upon exercise to include any associated
rights issued pursuant to a shareholder rights plan or other agreement of
similar purpose or effect), subject to adjustment as provided in the Tranche A
Warrant Agreement hereinafter referred to, at the purchase price (the
"Exercise Price") of $58.50 per share (subject to adjustment as provided
herein), upon surrender hereof at the office of Xxxxx Fargo Bank Minnesota,
N.A. or to its successor as the warrant agent under the Tranche A Warrant
Agreement (any such warrant agent being herein called the "Warrant Agent"),
with the Subscription Form on the reverse hereof duly executed, with signature
guaranteed as therein specified together with payment in full of the Exercise
Price then in effect for each share of Common Stock as to which a Tranche A
Warrant is exercised and any applicable taxes that GenTek is not required to
pay pursuant to the Warrant Agreement by and between GenTek and the Warrant
Agent (the "Tranche A Warrant Agreement"). Payment of the Exercise Price shall
be (a) made by the Holder in United States currency by delivery of a certified
check or bank cashier's check payable to the order of GenTek, or by wire
transfer of immediately available funds to an account designated by the
Warrant Agent for the benefit of GenTek or (b) deemed made in the case of a
cashless exercise in accordance with Section 3.03 of the Tranche A Warrant
Agreement, all subject to the terms and conditions hereof and of the Tranche A
Warrant Agreement. This Tranche A Warrant Certificate may be exercised as to
all or any whole number of the Tranche A Warrants evidenced hereby.
This Tranche A Warrant Certificate is issued under and in
accordance with the Tranche A Warrant Agreement and is subject to the terms
and provisions contained therein, all of which terms and provisions the Holder
of this Tranche A Warrant Certificate consents to by acceptance hereof. The
Tranche A Warrant Agreement is hereby incorporated herein by reference and
made a part hereof. Reference is hereby made to the Tranche A Warrant
Agreement for a full description of the rights, limitations of rights,
obligations, duties and immunities thereunder of GenTek and the Holders of the
Tranche A Warrants. The summary of the terms of the Tranche A Warrant
Agreement contained in this Tranche A Warrant Certificate is qualified in its
entirety by express reference to the Tranche A Warrant Agreement. All
capitalized terms used in this Tranche A Warrant Certificate that are defined
in the Tranche A Warrant Agreement shall have the meanings assigned to them in
the Tranche A Warrant Agreement.
Copies of the Tranche A Warrant Agreement are on file at the
office of the Warrant Agent and may be obtained by writing to the Warrant
Agent at the following address:
Xxxxx Fargo Bank Minnesota, N.A.
Shareowner Services
Attn: Account Management
000 X. Xxxxxxx Xxxxxxxx
Xxxxx Xx. Xxxx, XX 00000
The number of shares of Common Stock purchasable upon the
exercise of each Tranche A Warrant is subject to adjustment as provided in the
Tranche A Warrant Agreement. In the event GenTek merges or consolidates with,
or sells all or substantially all of its assets to, another Person, each
Tranche A Warrant will, upon exercise, entitle the Holder thereof to receive
the number of shares of capital stock or other securities or the amount of
money and other property which the holder of the number of shares of Common
Stock or other securities or property deliverable upon exercise of a Tranche A
Warrant is entitled to receive upon completion of such merger, consolidation
or sale.
As to any final fraction of a share which the same Holder of one
or more Tranche A Warrants would otherwise be entitled to purchase upon
exercise thereof in the same transaction, GenTek shall pay the cash value
thereof determined as provided in the Tranche A Warrant Agreement.
All Common Stock or other securities issuable upon the exercise
of Tranche A Warrants shall be validly issued, fully-paid and non-assessable.
GenTek will pay all documentary stamp taxes and other governmental charges
required by law attributable to the initial issuance of the Warrant
Certificates and of the shares issuable upon the exercise of Tranche A
Warrants; provided, however, that GenTek shall not be required to pay any tax
or other charges which may be payable in respect of any transfer involved in
the issue of any Warrant Certificates or any certificates for shares of Common
Stock in a name other than that of the registered holder of a Warrant
Certificate surrendered upon transfer, exchange or exercise of a Tranche A
Warrant represented thereby. In any such case, GenTek shall not be required to
issue or deliver such Warrant Certificates or certificates for shares of
Common Stock unless or until the Person or Persons requesting the issuance
thereof shall have paid to GenTek the amount of such tax or shall have
established to the satisfaction of GenTek and the Warrant Agent that such tax
has been paid.
This Tranche A Warrant Certificate and all rights hereunder are
transferable by the registered Holder hereof, in any whole number of Tranche A
Warrants, in accordance with the provisions of the Tranche A Warrant
Agreement, on the register maintained by the Warrant Agent for such purpose at
its office in South St. Xxxx, Minnesota, upon surrender of this Tranche A
Warrant Certificate duly endorsed, or accompanied by a written instrument of
transfer form satisfactory to GenTek and the Warrant Agent duly executed, with
signatures guaranteed as specified in the attached Form of Assignment, by the
registered Holder hereof or his attorney duly authorized in writing and upon
payment of any necessary transfer tax or other governmental charge imposed
upon such transfer. Upon any partial transfer, the Warrant Agent will issue
and deliver to such Holder a new Tranche A Warrant Certificate with respect to
any portion not so transferred. Each taker and Holder of this Tranche A
Warrant Certificate, by taking and holding the same, consents and agrees that
prior to the registration of transfer as provided in the Tranche A Warrant
Agreement, GenTek and the Warrant Agent may treat the person in whose name the
Tranche A Warrants are registered as the absolute owner hereof for any purpose
and as the Person entitled to exercise the rights represented hereby, any
notice to the contrary notwithstanding.
This Tranche A Warrant Certificate may be exchanged, in
accordance with the terms of the Tranche A Warrant Agreement, at the office of
the Warrant Agent maintained for such purpose in South St. Xxxx, Minnesota for
Tranche A Warrant Certificates representing the same aggregate number of
Tranche A Warrants, each new Tranche A Warrant Certificate to represent such
number of Tranche A Warrants as the Holder hereof shall designate at the time
of such exchange.
Prior to the exercise of the Tranche A Warrants represented
hereby, the Holder of this Tranche A Warrant Certificate, as such, shall not
be entitled to any rights of a stockholder of GenTek, including, without
limitation, the right to vote or to consent to any action of the stockholders,
to receive dividends or other distributions, to exercise any preemptive right
or to receive any notice of meetings of stockholders, and shall not be
entitled to receive any notice of any proceedings of GenTek except as provided
in the Tranche A Warrant Agreement.
Section 4.06 of the Tranche A Warrant Agreement provides for a
cash payment to the Holders of the Tranche A Warrants in the event of a
Communications Acquisition Transaction, subject to, and in accordance with,
the terms of the Tranche A Warrant Agreement.
This Tranche A Warrant Certificate shall be void and all rights
evidenced hereby shall cease on the Expiration Date.
This Tranche A Warrant Certificate shall not be valid for any
purpose until it shall have been countersigned by the Warrant Agent.
Dated:_____________________ GENTEK INC.
By:___________________________
Printed Name:_________________
Title:________________________
Countersigned:
XXXXX FARGO BANK MINNESOTA, N.A.,
as Warrant Agent
By:______________________________
Authorized Signatory
FORM OF REVERSE OF TRANCHE A WARRANT CERTIFICATE
SUBSCRIPTION FORM
(to be executed only upon exercise of Tranche A Warrants)
To:_____________________
The undersigned hereby irrevocably exercises of the Tranche A
Warrants represented by the within Tranche A Warrant Certificate for the
purchase of [ ] (subject to adjustment) share of Common Stock, no par value
per share, of GENTEK INC., a Delaware corporation, and herewith makes payment
in the following manner (please check the type of payment) (a) [ ] by payment
of $______________ pursuant to clause (i) of Section 3.03 of the Tranche A
Warrant Agreement (such payment being in United States currency by delivery of
a certified check or bank cashier's check payable to the order of GenTek, or
by wire transfer of immediately available funds to an account designated by
the Warrant Agent for the benefit of GenTek equal to the Exercise Price of the
Tranche A Warrants being exercised), or (b) [ ] by the cancellation of
________ shares of Common Stock otherwise issuable to the undersigned pursuant
to clause (ii) of Section 3.03 of the Tranche A Warrant Agreement, all at the
exercise price and on the terms and conditions specified in the within Tranche
A Warrant Certificate and the Tranche A Warrant Agreement therein referred to,
and hereby surrenders this Tranche A Warrant Certificate and all right, title
and interest therein to and directs that the Common Stock deliverable upon the
exercise of such Tranche A Warrants be registered or placed in the name and at
the address specified below and delivered thereto.
Dated:_____________________________
___________________________________
(Signature of Owner)
___________________________________
(Xxxxxx Xxxxxxx)
___________________________________
(City) (State) (Zip Code)
NOTICE - The signature(s) to the Subscription Form or the Assignment Form must
correspond to the name as written upon the face of the Warrant Certificate in
every particular without alteration or enlargement or any change whatsoever.
Signature Guaranteed By1
___________________________________
__________________
1 The signature must be guaranteed by a Securities Transfer Association
medallion program ("stamp") participant or an institution receiving prior
approval from the Warrant Agent.
Securities and/or check to be issued to:________________________________
Please insert social security or identifying number:____________________
Name:__________________________________________________________
Street Address:________________________________________________
City, State and Zip Code:______________________________________
ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned registered holder of the
within Tranche A Warrant Certificate hereby sells, assigns and transfers unto
the Assignee(s) named below (including the undersigned with respect to any
Tranche A Warrants constituting a part of the Tranche A Warrants evidenced by
the within Tranche A Warrant Certificate not being assigned hereby) all of the
rights of the undersigned under the within Tranche A Warrant Certificate, with
respect to the whole number of Tranche A Warrants set forth below:
Name(s) of Assignee(s):___________________________________
Address:__________________________________________________
No. of Tranche A Warrants:________________________________
Please insert social security or other identifying number of assignee(s):_______
____________________
and does hereby irrevocably constitute and appoint_________________________ the
undersigned's attorney to make such transfer on the books of _________________
maintained for such purposes, with full power of substitution in the premises.
Dated: ______________________ _____________________________________
(Signature of Owner)
_____________________________________
(Xxxxxx Xxxxxxx)
_____________________________________
(City) (State) (Zip Code)
NOTICE - The signature(s) to the Subscription Form or the Assignment Form must
correspond to the name as written upon the face of the Warrant Certificate in
every particular without alteration or enlargement or any change whatsoever.
Signature Guaranteed By2
_____________________________________
___________________
2 The signature must be guaranteed by a Securities Transfer Association
medallion program ("stamp") participant or an institution receiving prior
approval from the Warrant Agent.
