EXHIBIT 10.4
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS. NEITHER IT NOR ANY SHARES OF COMMON STOCK
ISSUABLE UPON ITS EXERCISE MAY BE SOLD OR OFFERED FOR SALE EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SAID ACT AND ANY APPLICABLE STATE
SECURITIES LAW OR AN APPLICABLE EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS.
------------------------
, 2002
[FOUNDERS-HOLDER'S NAME]
NEW C.E.I. INC.
COMMON STOCK PURCHASE WARRANT
New C.E.I. Inc., a Delaware corporation (the "Company"), hereby certifies
that for good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, U.S. Plastic Lumber Corp., having an address of 0000
Xxxxxx Xxxx, Xxxxx 000X, Xxxx Xxxxx, XX 00000 ("Holder") or any other Warrant
Holder is entitled, on the terms and conditions set forth below, to purchase
from the Company at any time beginning on the date hereof and ending on
, 2012, fully paid and nonassessable shares of Common
Stock, par value $.001, of the Company (the "Common Stock"), [the amount to
equal 4% of the sum of (i) the shares of Common Stock outstanding on ,
2002; (ii) the shares of Common Stock issuable upon conversion of all shares of
Preferred Stock of the Company outstanding on 2002, (iii) the
shares of Common Stock issuable upon exercise of all options (other than those
granted under a stock option plan of the Company approved by the Board of
Directors of the Company ("a Plan"), warrants or subscription rights outstanding
on 2002 and (iv) the shares of Common Stock issuable pursuant to
all Plans of the Company adopted as of such date to the extent such shares
exceed 10% of the sum of shares under (i), (ii) and (iii),] each in accordance
with their terms without reference to the date or the conditions under which
they first became or become convertible or exercisable. Such purchase shall be
at a purchase price of $.01 per share of Common Stock (the "Exercise Price"), as
may be adjusted from time to time pursuant to the terms and conditions of this
Warrant.
This Warrant may be exercised, in whole or in part, by Holder at any time
commencing immediately after delivery of this Warrant to Holder, pursuant to the
terms and conditions of the Escrow Agreement, and prior to and including 5:00
p.m. Eastern time on the tenth anniversary of the date hereof.
This Warrant is subject to the following provisions, terms and conditions:
1. Exercise; Payment. The rights represented by this Warrant may be
exercised by Holder, in whole or in part, by the surrender of this Warrant at
the principal office of Company properly endorsed and accompanied by payment to
Company of the Exercise Price for that number of shares of Common Stock sought
to be purchased (the "Exercised Shares"), in the manner provided below. The
Company agrees that (a) shares purchased upon exercise of this Warrant shall be
and are deemed to be issued to Holder as the record owner of such shares as of
the close of business on the date on which this Warrant shall have been
surrendered and payment made for such shares as provided herein, and (b)
certificates for the shares of stock so purchased shall be delivered to Holder
as promptly as reasonably practicable following any exercise of this Warrant,
and unless this Warrant shall have been exercised in full, or shall have
expired, a new Warrant representing the number of shares with respect to which
this Warrant shall not yet have been exercised, shall also be delivered to
Holder.
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Holder may pay the Exercise Price for any Exercised shares by cash, check,
money order or wire transfer of funds to the Company in the amount of the
Exercise Price of the Exercised Shares
2. Shares to be Fully Paid; Reservation. Company covenants and agrees that
all shares which may be issued upon the exercise of the rights represented by
this Warrant will, upon issuance and payment therefor in accordance with Section
1 above, be fully paid and nonassessable and free from all taxes, liens and
charges with respect to the issue thereof; and without limiting the generality
of the foregoing, Company covenants and agrees that it will from time to time
take all such action as may be required to assure that the par value per share
of the Common Stock is at all times not less than the then effective Exercise
Price per share of Common Stock issuable pursuant to this Warrant. Company
further covenants and agrees that when the rights represented by this Warrant
may be exercised, Company will at all times thereafter have authorized, and
reserved for the purpose of issue or transfer upon exercise of the rights
evidenced by this Warrant, a sufficient number of shares of its Common Stock to
provide for the exercise of the rights represented by this Warrant.
3. Protection Against Dilution.
(a) In the event at any time or from time to time, all holders of
Common Stock or any security convertible into Common Stock (or any other
shares of stock or other securities at that time receivable upon exercise
of this Warrant) shall have received, other or additional Common Stock or
other security convertible into Common Stock without payment therefor or
for nominal consideration (whether through a dividend in stock or any class
of stock of Company or any other corporation, or through stock split,
spinoff, split-off, reclassification, combination of shares or otherwise)
(a "Distribution"), then, and in each such case, Holder upon the exercise
of this Warrant and payment of the Exercise Price provided above, shall be
entitled to receive, in addition to the shares called for under this
Warrant, the shares or other securities to which Holder would have been
entitled in the Distribution if Holder had exercised this Warrant
immediately prior thereto. In case of the partial exercise of this Warrant
under such circumstances, the number of shares of stock or other securities
which would have been receivable upon the full exercise of this Warrant,
and the Exercise Price payable therefor computed as provided above, shall
be proportionately reduced.
(b) In case of any reorganization of Company, or any other corporation
the stock or securities of which are at the time deliverable on the
exercise of this Warrant, or in case the Company or such other corporation
shall consolidate with or merge into another corporation, or convey all or
substantially all of its assets to another corporation, or liquidate,
Holder, upon the exercise hereof and upon the payment of the Exercise Price
provided above, shall be entitled to receive, in lieu of the shares called
for under this Warrant, the stock or other securities to which Holder would
have been entitled upon the consummation of such reorganization,
consolidation, merger, conveyance, or liquidation if Holder had purchased
the shares called for hereby immediately prior thereto; and in such case,
the provisions of this Warrant shall be applicable to the shares of stock
or other securities thereafter deliverable upon the exercise of this
Warrant. In the case of the partial exercise of this Warrant under such
circumstances, the number of shares of stock or other securities which
would have been receivable upon the full exercise of this Warrant, and the
Exercise Price payable therefor, shall be proportionately reduced.
(c) If at any time the Company shall issue or sell any additional
shares of Common Stock, or other securities convertible into Common Stock,
in exchange for consideration in an amount per additional share of Common
Stock less than the Exercise Price at the time the additional shares of
Common Stock, or other securities convertible into Common Stock, are
issued, then (i) the Exercise Price as to the number of shares for which
this Warrant is exercisable prior to such adjustment shall be reduced to a
price determined by dividing (A) an amount equal to the sum of (x) the
number of shares of Common Stock outstanding immediately prior to such
issue or sale multiplied by the then existing Exercise Price, plus (y) the
consideration, if any, received by the Company upon such issue or sale, by
(B) the total number of shares of Common Stock outstanding immediately
after such issue or sale; and (ii) the number of shares of Common Stock for
which this Warrant is exercisable shall be adjusted to equal the product
obtained by multiplying the Purchase Price in effect immediately prior to
such issue or sale by the number of shares of Common Stock for which this
Warrant is exercisable immediately prior to such
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issue or sale and dividing the product thereof by the Exercise Price
resulting from the adjustment made pursuant to clause (i) above. For the
purpose of this Section 3(c) outstanding shall include shares of Common
Stock issuable upon conversion of outstanding convertible securities of the
Company and upon exercise of outstanding options, warrants and subscription
rights.
(d) In the event the Company shall at any time after the date hereof
issue options, warrants or rights to subscribe for shares of Common Stock
(including shares held in the Company's treasury) ("Exercisable
Securities"), or issue any securities convertible into or exchangeable for
shares of Common Stock, ("Convertible Securities") providing for an
exercise price or conversion or exchange rate per share less than the
Exercise Price in effect immediately prior to the issuance of such
Exercisable Securities or Convertible Securities, or without consideration,
then the Exercise Price in effect immediately prior to the issuance of such
Exercisable Securities or Convertible Securities shall each be reduced to a
price determined by making a computation in accordance with the provisions
of paragraph 3(c); provided that:
(i) the aggregate maximum number of shares of Common Stock
deliverable under such Exercisable Securities or Convertible Securities
shall be considered to have been delivered at the time such Convertible
Securities or Exercisable Securities were issued, and for a
consideration equal to the minimum purchase price per share of Common
Stock provided for in such Convertible Securities or Exercisable
Securities plus the cash consideration, if any, received by the Company
for such Convertible Securities or Exercisable Securities.
(ii) the aggregate maximum number of shares of Common Stock
deliverable upon conversion of or exchange for any such securities shall
be considered to have been delivered at the time of issuance of such
securities, and for a consideration equal to the consideration received
by the Company for such securities, plus the consideration, if any, to
be received by the Company upon the conversion or exercise thereof; and
(iii) on the expiration of rights under the Convertible Securities
or Exercisable Securities to convert or exercise such Convertible
Securities or Exercisable Securities shall forthwith be readjusted to
such Exercise Price as would have obtained had the adjustments made upon
the issuance of such Convertible Securities or Exercisable Securities
been made upon the basis of the delivery of only the number of shares of
Common Stock actually delivered upon the exercise of such rights under
the Convertible Securities or Exercisable Securities.
(e) In the event the Company shall at any time subdivide or combine
the outstanding shares of Common Stock, the Exercise Price and shall
forthwith be proportionately decreased in the case of subdivision or
increased in the case of combination. Any such adjustment shall become
effective at the close of business on the date that such subdivision or
combination shall become effective.
4. No Rights as Shareholder. Until the valid exercise of this Warrant, the
Holder hereof shall not be entitled to any voting right or other rights as a
shareholder of Company with respect to this Warrant.
5. Transfer of Warrants. Subject to Section 7 hereof, this Warrant and all
rights hereunder are transferable, in whole or in part, without charge to the
Holder, at the office or agency of Company referred to in Section 1 by the
Holder in person or by duly authorized attorney, upon surrender of this Warrant
properly endorsed. Each taker and holder of this Warrant, by taking or holding
the same, consents and agrees that this Warrant, when endorsed in blank, shall
be deemed negotiable, and that the holder hereof, when this Warrant shall have
been so endorsed, may be treated by Company and all other persons dealing with
this Warrant as the absolute owner hereof for any purpose and as the person
entitled to exercise the rights represented by this Warrant, or to the transfer
hereof on the books of Company, any notice to the contrary notwithstanding; but
until such transfer on such books, Company may treat the registered holder
hereof as the owner for all purposes.
6. Fractional Interests. Company shall not be required to issue fractional
shares of Common Stock upon the exercise of this Warrant. If any fraction of a
share of Common Stock would, except for the provisions of this Section 6, be
issuable upon the exercise of this Warrant (or specified portion thereof),
Company shall
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pay an amount in cash equal to the Fair Market Value (as defined below) of such
fraction of a Common Share on the business day prior to the date of such
exercise. As used in this Agreement, the "Fair Market Value" of the Common Stock
shall be the closing price of the Common Stock on the date of determination on
the principal stock market or quotation system on which the Common Stock is then
traded; provided, however, if the Common Stock is not, as of the date of
determination of the Fair Market Value, traded on a recognized public trading
market or quoted on a recognized quotation system, then the Fair Market Value
shall be determined by Company on the basis of such valuation as it considers
appropriate.
7. Compliance With Securities Laws. By acquiring this Warrant from Company
on the date hereof, the Holder hereby agrees, acknowledges, covenants,
represents and warrants as follows:
(a) This Warrant and the shares of Common Stock issuable upon exercise
hereof have not been registered under the Securities Act of 1933, as
amended (the "Securities Act"), or qualified or registered under any state
securities laws which may be applicable. Holder understands that this
Warrant has been issued and such shares of Common Stock may only be issued
and sold hereunder in transactions exempt from the registration or
qualification requirements of the Securities Act and applicable state
securities laws and Holder acknowledges that reliance on and the
availability of said exemptions is predicated in part on the accuracy of
Holder's representations and warranties herein.
(b) Holder represents and warrants that it is acquiring this Warrant
for its own account, for purposes of investment, and not with a view to, or
for sale in connection with, any distribution thereof within the meaning of
the Securities Act and the rules and regulations promulgated thereunder.
Holder represents, warrants and agrees that it will not sell, exercise,
transfer or otherwise dispose of this Warrant (or any interest therein) or
any of the Common Stock purchasable upon exercise hereof, except pursuant
to (i) an effective registration statement under the Securities Act and
applicable state securities laws or (ii) an opinion of counsel,
satisfactory to Company, that an exemption from registration under the
Securities Act and such laws is available. Holder further acknowledges and
agrees that Company is not required, legally or contractually, so to
register or qualify the Warrant or such Common Stock or to take any action
to make such an exemption available, except as otherwise specifically set
forth in Section 8 below. Holder understands that Company will be relying
upon the truth and accuracy of the representations and warranties contained
in this Section 7 in issuing this Warrant and such Common Stock without
first registering the issuance thereof under the Securities Act or
qualifying or registering the issuance thereof under any state securities
laws that may be applicable.
(c) Holder acknowledges that (i) there is not now, and there will not
be in the future, any public market for the Warrant, and there is not now a
public trading market for the Common Stock, and there can be no assurance
that there will be such market, and (iii) there can be no assurance that
Holder will be able to liquidate its investment in Company. Holder
represents and warrants that it is familiar with and understands the terms
and conditions of Rule 144 promulgated under the Securities Act.
(d) Holder represents and warrants to Company that (i) it has such
knowledge and experience in financial and business matters as is necessary
to enable it to evaluate the merits and risks of any investments in Company
and is not utilizing any other person to be a Holder representative in
connection with evaluation of such merits and risks; and (ii) it has no
need for liquidity in an investment in Company and is able to bear the risk
of that investment for an indefinite period and to afford a complete loss
thereof.
(e) Holder represents and warrants that it has had access to, and has
been furnished with, all of the information it has requested from Company
and has had an opportunity to review the books and records of Company and
to discuss with management and members of the board of directors of Company
the business and financial affairs of Company.
(f) Holder agrees that at the time of each exercise of this Warrant,
unless the issuance of shares of Common Stock issuable thereupon is
pursuant to an effective registration statement under the Securities Act,
Holder will provide Company with a letter embodying the representations and
warranties set forth in subsections (b) through (e), in form and substance
satisfactory to Company, and agrees that the
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certificate(s) representing any shares issued to it upon any exercise of
this Warrant may bear such restrictive legend as Company may deem necessary
to reflect the restricted status of such shares under the Securities Act
unless Company shall have received from Holder an opinion of counsel to
Holder, reasonably satisfactory in form and substance to Company, that such
restrictive legend is not required. If such legend is placed on such
certificate(s), before consenting to the removal of such legend and the
transfer of such shares, unless the request to remove such legend is made
in connection with a sale or transfer of the shares represented by such
certificate in a transaction registered under Section 5 of the Securities
Act, Company may insist upon the delivery to it of an opinion from counsel
to Holder, reasonably satisfactory in form and substance to Company, that
the contemplated transfer does not constitute a violation of the Securities
Act.
8. Covenant to Register.
8.1 For purposes of this Section 8, the following definitions shall
apply:
The terms "register", "registered", and "registration" refer to a
registration under the Securities Act effected by preparing and filing a
registration statement or similar documents in compliance with the
Securities Act or an amendment thereto, and the declaration or ordering of
effectiveness of such registration statement, document or amendment
thereto.
The term "Registrable Securities" means the shares of Common Stock
issued to the Holder pursuant to the exercise of the warrant, or as, a
dividend with respect to, or in exchange for or in replacement of, such
shares.
8.2 If the Company proposes to register (including for this purpose a
registration effected by the Company for shareholders other than the
Holder) any of its stock or other securities under the Securities Act in
connection with a public offering, (other than its initial public offering
of its stock or securities and other than a registration on Form X-0, Xxxx
X-0 or other limited purpose form), the Company shall, at such time,
promptly give the Holder written notice of such registration. Upon the
written request of Holder given within 10 days after receipt of such notice
by such Holder, the Company shall cause to be registered under the
Securities Act all of the Registrable Securities that Holder has requested
to be registered. However, the Company shall have no obligation under this
Section 8.2, to the extent that with respect to a registration related to a
public offering of securities for the account of the Company, any
underwriter of such public offering reasonably requests in writing that the
Registrable Securities or a portion thereof be excluded therefrom provided
however that in the event that any exclusion of the Registrable Securities
from a registration statement which also relates to securities of the
Company for the account or accounts of other security holders, shall be
effected on a pro rata basis among the Holder and the other such security
holders based on the number of shares to be registered.
8.3 Whenever required under Section 8.2 to effect the registration of
any Registrable Securities, the Company shall, as expeditiously as
reasonably possible:
(i) Include in such registration statement such Registrable
Securities for purposes of registering them under the Securities Act,
file with the Securities and Exchange Commission (the "SEC") the
registration statement, use its best efforts to cause such registration
statement to become effective and, to keep such registration statement
effective for so long as Holder desires to dispose of the securities
covered by such registration statement but not longer than nine months
from the effective date or, if earlier, at such time as Holder could
sell all of such Registrable Securities under Rule 144(k) without
limitation or delay. The registration statement (and each amendment or
supplement thereto, and each request for acceleration of effectiveness
thereof) shall be provided to (and subject to the approval of) the
holders of the Registrable Securities and their counsel at least 5 days
prior to its filing or other submission, which approval shall be
promptly provided and shall not be unreasonably withheld.
(ii) Prepare and file with the SEC such amendments and supplements
to such registration statements and the prospectus used in connection
with such registration statement as may be
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necessary to comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such
registration statement.
(iii) Furnish to the Holder such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements
of the Securities Act, and such other documents as the Holder may
reasonably request in order to facilitate the disposition of Registrable
Securities owned by the Holder.
(iv) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions in which the Registrable Securities
to be offered therein have a market value of at least $100,000 as shall
be reasonably requested by Holder, provided that the Company shall not
be required in connection therewith or as a condition thereto to qualify
to do business or to file a general consent to service of process in any
such states or jurisdictions.
(v) Notify Holder of the happening of any event as a result of
which the prospectus included in such registration statement, as then in
effect, includes an untrue statement of material fact or omits to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then
existing. In such an event, the Company shall promptly file with the SEC
all appropriate amendments and supplements to such prospectus.
(vi) Furnish to Holder such copies of the Prospectus included in
the Registration Statement and any amendments and supplements as Holder
shall reasonably request.
8.4 Holder will furnish to the Company in connection with any
registration under this Section 8 such information regarding itself, the
Registrable Securities and other securities of the Company held by it, and
the intended method of disposition of such securities as shall be required
to effect the registration of the Registrable Securities held by Holder.
8.5 (i) The Company shall indemnify, defend and hold harmless each
holder of Registrable Securities which are included in a registration
statement pursuant to the provisions of this Section 8, any underwriter (as
defined in the Securities Act) for such holder, and the directors,
officers, members and controlling persons of such holder or underwriter
from and against, and shall reimburse all of them with respect to, any and
all claims, suits, demands, causes of action, losses, damages, liabilities,
costs or expenses ("Liabilities") to which any of them may become subject
under the Securities Act or otherwise, arising from or relating to (A) any
materially untrue statement or alleged materially untrue statement of any
material fact contained in such registration statement, any prospectus
contained therein or any amendment or supplement thereto, or (B) the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements herein, in light of
the circumstances in which they were made, not misleading; provided,
however, that the Company shall not be liable in any such case to the
extent that any such Liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so
made in conformity with information furnished by such person in writing
specifically for use in the preparation thereof.
(ii) Each holder of Registrable Securities included in a
registration pursuant to the provision of this Section 8 shall
indemnify, defend and hold harmless the Company, its directors and
officers, and shall reimburse the Company its directors and officers
with respect to, any and all Liabilities to which any of them may become
subject under the Securities Act or otherwise, arising from or relating
to (A) any untrue statement or alleged untrue statement of any material
fact contained in such registration statement, any prospectus contained
therein or any amendment or supplement thereto, or (B) the omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, in each case to
the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was so made in
reliance upon and in strict conformity with written information
furnished by or on behalf of such holder specifically for use in the
preparation thereof.
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(iii) Promptly after receipt by an indemnified party pursuant to
the provisions of Sections 8.5(i) or 8.5(ii) of notice of the
commencement of any action involving the subject matter of the foregoing
indemnity provisions, such indemnified party shall, if a claim thereof
is to be made against the indemnifying party pursuant to the provisions
of Sections 8.5(i) or 8.5(ii), promptly notify the indemnifying party of
the commencement thereof; provided, however, that the failure to so
notify the indemnifying party shall not relieve it from its
indemnification obligations hereunder except to the extent that the
indemnifying party is materially prejudiced by such failure. If such
action is brought against any indemnified party and it notifies the
indemnifying party of the commencement thereof, the indemnifying party
shall have the right to participate in, and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such
indemnified party; provided, however, if the defendants in any action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be
legal defenses different from or in addition to those available to the
indemnifying party, or if there is conflict of interest which would
prevent counsel for the indemnifying party from also representing the
indemnified party, the indemnified party shall have the right to select
separate counsel to participate in the defense of such action on behalf
of such indemnified party. After notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof,
the indemnifying party shall not be liable to such indemnified party
pursuant to Sections 8.5(i) or 8.5(ii) for any expense of counsel
subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation, unless (A)
the indemnified party shall have employed counsel in accordance with the
provisions of the preceding sentence, or (B) the indemnifying party
shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after the
notice of the commencement of the action. An indemnifying party shall
not be responsible for amounts paid in settlement without its consent,
provided that its consent may not be unreasonably withheld or delayed.
No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened
action or claim in respect of which indemnification or contribution may
be sought hereunder (whether or not the indemnified party is an actual
or potential party to such action or claim) unless such settlement,
compromise or judgment (i) includes an unconditional release of the
indemnified party from all liability arising out of such action or claim
and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified
party.
8.6 With respect to including of Registrable Securities in a
registration statement pursuant to this Section 8, the Company shall bear
all registration, filing and NASD fees, printing expenses, fees and
disbursements of counsel and accountants for the Company, and all legal
fees and disbursements and other expenses of the Company complying with
state securities or Blue Sky laws of any jurisdiction or jurisdictions in
which securities to be offered are to be registered and qualified Security
holders participating in such registration shall bear their pro rata share
of the underwriting discounts and commissions, if any.
8.7 The rights to have all or any portion of Registrable Securities
registered pursuant to this Section 8 may be assigned by the Holder to a
transferee or assignee of the Registrable Securities. Within a reasonable
time after such transfer the Holder shall notify the Company of the name
and address of such transferee or assignee and the securities with respect
to which such registration rights are being assigned. Such assignment shall
be effective only if immediately following such transfer the further
disposition of such securities by the transferee or assignee is restricted
under the Securities Act. Any transferee asserting registration rights
hereunder shall be bound by the provision of this Section 8.
8.8 In connection with any primary offering involving an underwriting
of shares of the Company's common stock, the Company shall not be required
under this Section 8 to include any Holder's securities in such
underwriting unless Holder accepts the terms of the underwriting as agreed
upon between the
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Company and the underwriters selected by it, and then only in such quantity
as the underwriters determine in their sole discretion will not jeopardize
the success of the offering by the Company.
8.9 The Company may suspend the effectiveness of a registration
statement required by this Section 8 for a period of not more than 30 days
if the Company is engaged in confidential negotiations or other
confidential business activities the disclosure of which (in the reasonable
opinion of outside counsel to the Company) would be required in such
registration statement and would not be required if such registration
statement were not filed and effective, and the Board of Directors of the
Company determines in good faith that such disclosure would be materially
detrimental to the Company and its stockholders, provided, however, that
the Company shall not utilize this right more than twice in any
twelve-month period and not sooner than 30 days after the prior use of such
right.
9. Notice. Company covenants and agrees to give notice in writing to
Holder at least 10 days prior to (or, if later, then as soon as reasonably
practicable prior to) any action contemplated which would affect the per share
Exercise Price, or number of shares purchasable upon exercise of this Warrant;
provided, however, any failure of Company to provide such notice shall not
affect the validity of any action by Company. Any notice, request or other
communication provided for under this Warrant shall be given in writing,
delivered by hand, by overnight United States Mail, return receipt requested,
postage prepaid, or through a reputable courier service (such as Federal
Express) and shall be addressed to Company or to the Holder at the address shown
below, unless notice of a change in address is furnished in accordance with this
paragraph:
If to the Company:
New C.E.I. Inc.
c/o Founders Management Services Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxx, Chairman
If to Holder:
U.S. Plastic Lumber Corp.
0000 Xxxxxx Xxxx, Xxxxx 000X
Xxxx Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxxxx, Vice President and General Counsel
10. Descriptive Headings and Governing Law. The descriptive headings of
the several paragraphs of this Warrant are inserted for convenience only and do
not constitute a part of this Warrant. This Warrant is being delivered and is
intended to be performed in the State of Delaware and shall be construed and
enforced in accordance with, and the rights of the parties shall be governed by,
the law of such state.
IN WITNESS WHEREOF, has caused this Warrant to be signed by
its duly authorized officers under its corporate seal, this day of
, 2002.
By:
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Xxxxxx X. Xxxxx, Chairman
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