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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (date of earliest event reported): April 28, 1998
Dominion Bridge Corporation
(Exact name of registrant as specified in its charter)
Delaware 1-10372 23-2577796
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification Number)
500 Notre Dame Street, Lachine, Quebec, CANADA H8S 2B2
(Address of principal executive offices) (ZIP Code)
Registrant's telephone number, including area code: (514) 634-3550
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Item 1. Changes in Control of Registrant.
On April 28, 1998, Dominion Bridge Corporation (the "Company")
completed a series of transactions (collectively the "Transactions") which have
resulted in a change in control of the Company. As more fully explained below,
Deere Park Equities, LLC, an Illinois limited liability company ("Deere Park"),
and its affiliates have obtained sole beneficial ownership of approximately
31.2% of the Company's outstanding shares.
Overview Of The Transactions And The Parties
During the past several weeks, the Company's Board of Directors and the
principals of Deere Park negotiated a series of agreements by and among Michel
L. Marengere, Nicolas V. Matossian and Rene Amyot (collectively the
"Executives"), Wellgate International, Ltd., a British Virgin Islands company
controlled by the Executives ("Wellgate"), Deere Park, and its affiliates
Dominion Park Equities, LLC, a Delaware limited liability company ("Dominion
Park"), Lamar Investments, Inc., an Illinois corporation ("Lamar"), and
Riverwood Investments, LLC, an Illinois limited liability ("Riverwood"). The
Transactions were closed on April 28, 1998 and provided for the following:
1. Michel L. Marengere's resignation as the Chairman, Chief Executive
Officer and Director of the Company and its subsidiaries and the
termination of the services agreement governing the services
provided to the Company by Mr. Marengere;
2. Nicolas V. Matossian's resignation as the President, Chief
Operating Officer and Director of the Company and its subsidiaries
and the termination of the services agreement governing the
services provided to the Company by Mr. Matossian;
3. Rene Amyot's resignation as a Director of the Company and its
subsidiaries;
4. Lamar's infusion of up to $10 million of additional working
capital into the Company; and
5. Dominion Park's buyout of substantially all of the Executives'
then-existing ownership interest in the Company.
Based on the Schedule 13D (the "Schedule 13D") dated April 28, 1998
filed by Deere Park and others with the Securities and Exchange Commission (the
"SEC") on or about May 7, 1998, Dominion Park is controlled by Deere Park and
Riverwood. Deere Park is controlled by Douglas A. Gerrard ("Gerrard") and
Riverwood is controlled by Deere Park and Deere Park Capital Management, Inc.,
an Illinois corporation ("DPCM"). DPCM is controlled by Gerrard and Leonard
Feldman ("Feldman") and Lamar is controlled by Feldman. According to the
Schedule 13D, Deere Park, Dominion Park, DPCM, Lamar, Riverwood, Gerrard and
Feldman are acting as a "group," as that term is defined under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and
regulations promulgated thereunder, with
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respect to the shares of Common Stock of the Company. Deere Park, Dominion Park,
DPCM, Lamar, Riverwood, Gerrard and Feldman are hereinafter referred to
collectively as the "Group".
As a result of the Transactions, the Group, which is ultimately
controlled by Gerrard and Feldman, is deemed to beneficially own approximately
31.2% of the Company's outstanding shares as determined under the rules
promulgated by the SEC. Prior to the Transactions, the Group shared control of
the Company with Michel L. Marengere, former Chairman and Chief Executive
Officer of the Company ("Marengere"), and Nicolas V. Matossian, former President
and Chief Operating Officer of the Company ("Matossian"). As more fully
explained below, Messrs. Marengere and Matossian transferred all of their
then-existing ownership interest in the Company to the Group.
Description Of The Transactions
The following is a description of the material components of the
Transactions.
Separation with Executives. The separation with the Executives
consisted of (i) the termination of the Service Agreements with Messrs.
Marengere and Matossian and resignation of Mr. Amyot pursuant to separate
Settlement, Release and Discharge Agreements (collectively the "Settlement
Agreements") providing for the mutual release of any and all claims in
consideration of an aggregate payment to Wellgate, as the nominee for the
Executives, in the form of the Company's note, in the amount of $4.8 million;
and (ii) a three (3) year Consulting Agreement (the "Consulting Agreement")
between Lamar and Wellgate, as the nominee for the Executives, providing for the
payment of an aggregate amount of $483,333 per year which is guaranteed by the
Company. The Settlement Agreements include releases by the Company of (i) the
$1.824 million subscription receivable in the name of Fidutech Technologies,
Inc. ("Fidutech"), a company controlled by Messrs. Marengere and Amyot; and (ii)
the $1.155 million guarantee of Fidutech regarding the value of the preferred
stock issued to the Company in connection of the sale of Edinov.
Financing Transaction. Lamar has agreed to provide the Company with a
credit facility in the principal amount of up to $10 million. Based on the
Company's need for additional working capital, the Executives also agreed to
reinvest the $4.8 million due them under the Settlement Agreements into the
Company. These obligations were invested by Lamar and the Executives pursuant to
the terms of a Credit Agreement ("Credit Agreement") by and among the Company,
Lamar and Wellgate. The Company is obligated to make monthly interest payments
to Lamar and Wellgate based on the outstanding principal amount due under the
Credit Agreement.
Pursuant to the Credit Agreement, the Company issued a Convertible
Revolving Note to Lamar in the principal amount of up to $10 million (the "Lamar
Note") and a Convertible Term Note to Wellgate in the principal amount of $4.8
million (the "Executive Note" and together with the Lamar Note, the "Notes").
The Notes bear interest at the rate of 11.5%, are secured by a second priority
perfected security interest in substantially all of the assets of the Company
and are convertible into shares of Common Stock of the Company at $2.60 per
share. The Company also issued warrants (the "Warrants") to purchase shares of
Common Stock of the Company at
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$3.00 per share for a three (3) year period; 333,708 Warrants were issued to
Wellgate and up to 1,668,536 Warrants will be issued to Lamar based on the
amount of advances made under the Loan. As of May 11, 1998, approximately $7.55
million has been advanced by Lamar to the Company under the Credit Agreement. It
is anticipated that the remaining amount available under the Lamar Note will be
advanced within the next 30 days. The Company has agreed to register the resale
of the shares of Common Stock issuable upon exercise or covnersion as
applicable, of the Notes and Warrants with the SEC pursuant to the terms of a
registration rights agreement among the Company, Lamar and Wellgate.
In the event of any material breach by the Company under the Executive
Note or Settlement Agreements, all moneys due and owing the Executives shall be
immediately due and payable and the release included in the Settlement
Agreements will be null and void.
Based on the Schedule 13D, Lamar obtained temporary funding for the
Credit Agreement pursuant to a loan and security agreement with DBAE Venture,
LLC, a Delaware limited liability company which is controlled by Feldman
("DBAE"), in which DBAE made a term loan to Lamar in the principal amount of $10
million.
Buyout of Executives. The Transactions also involved the Executives
selling substantially all of their then-existing ownership interest in the
Company to Dominion Park. Prior to the closing of the Transactions, Dominion
Park beneficially owned 6,664,060 shares of Common Stock of the Company. This
consisted of 2,380,000 shares owned of record by Dominion Park, 2,110,000 owned
of record by Deere Park over which Dominion Park held a proxy and 2,067,460
owned of record by Wellgate, as nominee for the Executives or their affiliates
and certain others, over which Dominion Park held a proxy. Prior to the closing
of the Transactions, the sole members of Dominion Park were Deere Park and
Wellgate, and Dominion Park was jointly managed by Gerrard, Feldman, Marengere
and Matossian.
Pursuant to the Transactions, Marengere's and Matossian's interests in
Dominion Park were redeemed in full (the "Buyout Agreement"). The Buyout
Agreement consisted of (i) Wellgate withdrawing as a member of Dominion Park;
(ii) Marengere and Matossian withdrawing as managers of Dominion Park; (iii)
Riverwood's admission as a member of Dominion Park; (iv) Dominion Park's
purchase of any and all interest of Wellgate in Dominion Park, which consisted
of its proportionate interest in the shares owned of record by Dominion Park;
and (v) Dominion Park's purchase of 2,023,399 shares of Common Stock of the
Company owned of record by Wellgate, for aggregate payment consisting of 775,000
shares of American Eco common stock (the "American Eco Shares") which were
contributed to Dominion Park by Riverwood.
Based on the Schedule 13D, Dominion Park obtained the American Eco
Shares in connection with Riverwood's admission as a member of Dominion Park.
Riverwood obtained the American Eco Shares under an admission agreement dated as
of April 24, 1998 by and between DPCM and Riverwood and an admission agreement
dated as of April 24, 1998 by and between Deere Park and Riverwood pursuant to
which Deere Park and DPCM contributed the American Eco Shares to Riverwood and
were admitted as members of Riverwood. Prior to Deere Park's admission to
Riverwood, STG Investments, Inc., a Liberia corporation and Class C member of
Deere Park, contributed 387,000 of the American Eco Shares to Deere Park. The
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remaining 388,000 American Eco Shares were purchased by Deere Park and DPCM on
the open market.
Beneficial Ownership Of Company Shares
As a result of the Buyout Agreement, the Executives transferred
virtually their entire ownership interest in the Company to Dominion Park.
However, as a result of the Executives reinvesting the amounts due under the
Settlement Agreements into the Company, they have the right to acquire 2,179,862
shares of Common Stock upon the exercise or conversion, as applicable, of the
Executive Note and Warrant. Under applicable SEC rules, the Executives are
deemed to beneficially own these shares which represent approximately 6.1% of
the Company's outstanding shares.
As a result of the Buyout Agreement, Dominion Park and Deere Park now
have voting and dispositive power with respect to 6,619,999 shares of Common
Stock. In addition, Lamar has the right to acquire up to 5,514,690 additional
shares upon the exercise or conversion, as applicable, of the Lamar Note and
certain Warrants. Since Deere Park and its affiliates are acting together as a
group with respect to the shares of Common Stock of the Company, under
applicable SEC rules, the Group, which is ultimately controlled by Gerrard and
Feldman, is deemed to beneficially own 12,134,689 shares of Common Stock or
approximately 31.2% of the Company's outstanding shares.
Effect of Company Rights Plan on the Transaction.
The Company has a Rights Plan which provides for the issuance of rights
to purchase common equivalent shares of the Company at a 50% discount to the
then current market price in the event that certain persons acquire beneficial
ownership of more than 15% of the Company's outstanding common shares. Deere
Park and its affiliates are exempt from the operation of the Rights Plan so long
as they do not acquire beneficial ownership of more than 23% of the Company's
outstanding shares. As explained above, the Transactions have resulted in Deere
Park and its affiliates acquiring beneficial ownership of 31.2 % of the
Company's outstanding shares.
In connection with closing of the Transactions, the Company's Board of
Directors amended the Rights Plan to delay the distribution of the rights until
45 days after the closing of the Transactions (June 12, 1998). During this 45
day period the Board of Directors of the Company will evaluate the operation of
the Rights Plan with respect to Deere Park and its affiliates. Specifically, the
Board of Directors will analyze the Group's strategic plan with respect to the
management and operation of the Company. Based on its analysis, the Board of
Directors will either (i) redeem the rights; or (ii) further amend the Rights
Plan to exclude the Group from the operation of the Rights Plan.
Changes in Executive Management
In connection with the resignation of the Executives as directors, the size of
the Company's Board of Directors was reduced from ten (10) to five (5), thereby
eliminating all
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vacancies. As a result, the composition of the Board now consists of the
following Directors: Allen S. Gerrard, Derek S. Tennant, Michael E. McGinnis,
Louis Berlinguet and Reynald Lemieux.
In connection with the resignations of Messrs. Marengere and Matossian
as officers of the Company, the Board has appointed Directors Allen S. Gerrard
and Derek S. Tennant to serve as the Interim Chief Executive Officer and Interim
Chief Operating Officer, respectively, of the Company. Gary I. Levenstein,
Co-Chairman of the corporate law department of the Chicago, Illinois law firm of
Ungaretti & Harris, was appointed to serve as the Secretary of the Company. Mr.
Levenstein has practiced corporate law for over 20 years, specializes in
mergers, acquisitions and corporate finance transactions and is also a certified
public accountant. The Company is currently in negotiations with these persons
regarding the specific terms on which they will serve as officers of the
Company. It is contemplated that these persons will receive compensation
consisting of cash, options or a combination thereof.
Agreement with EIF Holdings, Inc. Subject to approval by the Board of
Directors, the Company and EIF Holdings, Inc. ("EIF") have agreed to enter into
a management services agreement pursuant to which EIF will provide the Company
with management services in connection with its ongoing, day-to-day operations
for a period of six (6) months on substantially the terms described below.
Subject to the general supervision and control of the Executive
Committee of the Board of Directors of the Company, EIF has agreed to furnish
the Company with management services consisting of: (i) financing and
administrative support services, including oversight of collection of accounts
receivable and payment of accounts payable; (ii) marketing administration and
support services; (iii) human resources management; and (iv) oversight and
administration of the Company's operating units. As compensation for these
services, the Company has agreed to pay EIF a management fee of $100,000 per
month and to reimburse EIF for all reasonable out-of-pocket expenses and
disbursements incurred in rendering such services. In order to facilitate the
provision of these services, Frank J. Fradella and J. Drennan Lowell, the Chief
Executive and Chief Financial Officers, respectively, of EIF will be given
responsibilities within the Company's organization which are customarily
performed by a corporation's Chief Executive and Chief Financial Officers. Below
is a brief summary of their business experience during the past five (5) years.
Frank J. Fradella has been President, CEO and a director of EIF since
May 1997 and has been Chairman since November 1997. From October 1996 to May
1997, he was Executive Vice President and Chief Operating Officer of American
Eco. From February 1993 to October 1996, he was employed by NSC Corporation, a
specialty contractor, having been serving as its President and CEO since
September 1994. From February 1991 to January 1993, Mr.
Fradella was Vice President of Kaselaan & D'Angelo Associates.
J. Drennan Lowell has been Vice President, Chief Financial Officer,
Treasurer and Secretary of EIF since October 1997. Previously, Mr. Lowell was
employed by NSC Corporation where he held the positions of Vice President, Chief
Financial Officer and Secretary
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from November 1993 through August 1997 and Treasurer from May 1994 through 1997.
Prior to joining NSC, Mr. Lowell served as Vice President of Finance for
Wheelabrator Clean Air Systems Inc. from December 1992 to November 1993 and for
Wheelabrator Clean Water Systems Inc. from August 1991 to November 1993.
Item 7. Exhibits
Exhibit 4.1 Common Stock Purchase Warrant issued to Wellgate
International, Ltd. to purchase 333,708 shares of Common Stock of the Registrant
at $3.00 per share for a three (3) year term commencing April 21, 1998.
Exhibit 4.2 Form of Common Stock Purchase Warrant issued to Lamar
Investments, Inc. to purchase up to 1,668,536 shares of Common Stock of the
Registrant at $3.00 per share for a three (3) year term commencing April 21,
1998.
Exhibit 4.3 Form of Convertible Term Promissory Note issued to Wellgate
International, Ltd. in the principal amount of $4.8 million convertible into
shares of Common Stock of the Registrant at $2.60 per share.
Exhibit 4.4 Form of Convertible Revolving Promissory Note issued to
Lamar Investments, Inc. in the principal amount of up to $10 million convertible
into shares of Common Stock of the Registrant at $2.60 per share.
Exhibit 10.1 Credit Agreement dated as of April 6, 1998 by and among
Lamar Investments, Inc. and Wellgate International, Ltd., as lenders and Groupe
Cedar Canada, Inc. as borrower and the Registrant, Dominion Bridge, Inc., Steen
Contractors Limited, Industries Davie Inc., Cedar Group Australia Pty Limited,
Les Entrepreneurs Becker Inc., Becker Contractors Limited and MIL Intermodel
Inc. as subsidiary guarantors. (Incorporated by the reference to Exhibit 7 to
Amendment No. 5 to Schedule 13D dated April 28, 1998 filed by Douglas A. Gerrard
and others with the Securities and Exchange Commission. SEC File No. 005-40631).
Exhibit 10.2 Settlement, Release and Discharge Agreement dated April
28, 1998 by and among the Registrant, Michel L. Marengere and Services M.L.
Marengere, Inc.
Exhibit 10.3 Settlement, Release and Discharge Agreement dated April
28, 1998 by and among the Registrant, Nicolas V. Matossian and Greyhorse
Resources (Canada), Ltd.
Exhibit 10.4 Settlement, Release and Discharge Agreement dated April
28, 1998 by and between the Registrant and Rene Amyot.
Exhibit 10.5 Consulting Agreement dated April 24, 1998 by and among
Wellgate International, Ltd., Riverwood Investments, LLC and the Registrant.
Exhibit 10.6 Registration Rights Agreement dated April 21, 1998 by and
among the Registrant, Wellgate International, Ltd. and Lamar Investments, Inc.
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Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, as amended, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereto duly authorized.
DOMINION BRIDGE CORPORATION
By: /s/ Allen S. Gerrard
-------------------------------------
Name: Allen S. Gerrard
Title: Chairman of the Board of Directors and
Interim Chief Executive Officer
May 13, 1998
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER METHOD OF FILING
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<S> <C> <C>
4.1 Common Stock Purchase Warrant issued to Wellgate International, Filed herewith.
Ltd. to purchase 333,708 shares of Common Stock of the Registrant
at $3.00 per share for a three (3) year term commencing April 21,
1998.
4.2 Form of Common Stock Purchase Warrant issued to Lamar Investments, Filed herewith
Inc. to purchase up to 1,668,536 shares of Common Stock of the
Registrant at $3.00 per share for a three (3) year term commencing
April 21, 1998.
4.3 Form of Convertible Term Promissory Note issued to Wellgate Filed herewith
International, Ltd. in the principal amount of $4.8 million
convertible into shares of Common Stock of the Registrant at $2.60
per share.
4.4 Form of Convertible Revolving Promissory Note issued to Lamar Filed herewith
Investments, Inc. in the principal amount of up to $10 million
convertible into shares of Common Stock of the Registrant at $2.60
per share.
10.1 Credit Agreement dated as of April 6, 1998 by and among Lamar Incorporated by the
Investments, Inc. and Wellgate International, Ltd., as lenders and reference to Exhibit 7 to
Groupe Cedar Canada, Inc. as borrower and the Registrant, Dominion Amendment No. 5 to Schedule
Bridge, Inc., Steen Contractors Limited, Industries Davie Inc., 13D dated April 28, 1998
Cedar Group Australia Pty Limited, Les Entrepreneurs Becker Inc., filed by Douglas A. Gerrard
Becker Contractors Limited and MIL Intermodel Inc. as subsidiary and others with the
guarantors. Securities and Exchange
Commission. (SEC File No.
005-40631.)
10.2 Settlement, Release and Discharge Agreement dated April 28, 1998 Filed herewith
Filed herewith by and among the Registrant, Michel L. Marengere
and Services M.L.
Marengere, Inc.
</TABLE>
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<TABLE>
<CAPTION>
EXHIBIT
NUMBER METHOD OF FILING
- ------ ----------------
<S> <C> <C>
10.3 Settlement, Release and Discharge Agreement dated April 28, 1998 Filed herewith
by and among the Registrant, Nicolas V. Matossian and Greyhorse
Resources (Canada), Ltd.
10.4 Settlement, Release and Discharge Agreement dated April 28, 1998 Filed herewith
by and between the Registrant and Rene Amyot.
10.5 Consulting Agreement dated April 24, 1998 by and among Wellgate
Filed herewith International, Ltd., Riverwood Investments, LLC
and the Registrant.
10.6 Registration Rights Agreement dated April 21, 1998 by and among Filed herewith
the Registrant, Wellgate International, Ltd. and Lamar
Investments, Inc.
</TABLE>
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EXHIBIT 4.1
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES REPRESENTED BY
THIS CERTIFICATE HAVE BEEN TAKEN BY THE REGISTERED OWNER FOR INVESTMENT,
AND WITHOUT A VIEW TO RESALE OR DISTRIBUTION THEREOF, AND MAY NOT BE
TRANSFERRED OR DISPOSED OF WITHOUT AN OPINION OF COUNSEL SATISFACTORY TO
THE ISSUER THAT SUCH TRANSFER OR DISPOSITION DOES NOT VIOLATE THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE RULES AND REGULATIONS
THEREUNDER.
WARRANT TO PURCHASE
COMMON STOCK OF
DOMINION BRIDGE CORPORATION
Void after 5:00 p.m. Eastern Standard Time on April 20, 2001.
This is to verify that, FOR VALUE RECEIVED, WELLGATE INTERNATIONAL
LTD., a British Virgin Islands corporation (hereinafter referred to as the
"Holder"), with a principal address at c/o Pouliot Mercure CIBC Tower, 31st
Floor, 1155 Rene-Levesque Blvd. West, Montreal, Quebec, Canada H3B 3S6, is
entitled to purchase, subject to the terms and conditions hereof, from DOMINION
BRIDGE CORPORATION (the "Company") 333,708 shares of Common Stock, $.001 par
value per share (the "Common Stock"), during the period commencing at 9:00 a.m.,
Eastern Standard Time on April 21, 1998 (the "Commencement Date") and ending at
5:00 p.m. Eastern Standard Time on April 20, 2001 (the "Termination Date") at an
exercise price of $3.00 per share of Common Stock. The number of shares of
Common Stock purchasable upon exercise of this Warrant (the "Warrant(s)") and
the exercise price per share shall be subject to adjustment from time to time
upon the occurrence of certain events as set forth below.
The shares of Common Stock or any other shares or other units of stock
or other securities or property, or any combination thereof then receivable upon
exercise of this Warrant, as adjusted from time to time, are sometimes referred
to hereinafter as "Exercise Shares". The exercise price per share as from time
to time in effect is referred to hereinafter as the "Exercise Price".
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1. Exercise of Warrant; Issuance of Exercise Shares.
(a) Exercise of Warrant. This Warrant may be exercised in whole or in
part at any time or from time to time on or after the Commencement Date and
until and including the Termination Date. This Warrant may be surrendered on any
business day to the Company at its principal office, presently located at the
address of the Company set forth in Paragraph 9 hereof, (or such other office of
the Company, if any, as shall theretofore have been designated by the Company by
written notice to the Holder), together with: (i) a completed and executed
Notice of Warrant Exercise in the form set forth in Appendix A hereto and made a
part hereof; and (ii) payment of the full Exercise Price for the amount of
Exercise Shares set forth in the Notice of Warrant Exercise, in lawful money of
the United States of America by certified check or cashier's check, made payable
to the order of the Company, together with certification of investment intent
and such other agreements, representations and warranties as counsel for the
Company shall require to establish an exemption from the registration
requirements of the Securities Act of 1933, as amended (the "Securities Act").
Notwithstanding anything contained herein to the contrary, prior to any exercise
of this Warrant, Holder shall take all actions required in the reasonable
judgment of the Company to comply with Australian Securities laws in connection
with such exercise.
In the event that this Warrant shall be duly exercised in part prior to
the Termination Date, the Company shall issue a new Warrant Certificate of like
tenor evidencing the rights of the Holder thereof to purchase the balance of the
Exercise Shares purchasable under the Warrant so surrendered that shall not have
been purchased.
The Company shall cancel Warrant Certificates surrendered upon exercise
of Warrants.
(b) Issuance of Exercise Shares; Delivery of Certificates. The Company
shall, within five (5) business days or as soon thereafter as is practicable of
the exercise of this Warrant, issue in the name of and cause to be delivered to
the Holder (or such other person or persons, if any, as the Holder shall have
designated in the Notice of Warrant Exercise) one or more certificates
representing the Exercise Shares to which the Holder (or such other person or
persons) shall be entitled upon such exercise under the terms hereof. Such
certificate or certificates shall be deemed to have been issued and the Holder
(or such other person or persons so designated) shall be deemed to have become
the record holder of the Exercise Shares as of the date of the due exercise of
this Warrant.
(c) Exercise Shares Fully Paid and Non-assessable. The Company agrees
and covenants that all Exercise Shares issuable upon the due exercise of the
Warrant represented by this Warrant Certificate will, upon issuance in
accordance with the terms hereof, be duly authorized, validly issued, fully paid
and non-assessable and free and clear of all taxes (other than taxes which,
pursuant to Paragraph 2 hereof, the Company shall not be obligated to pay) or
liens, charges, and security interests created by the Company with respect to
the issuance thereof.
(d) Reservation of Exercise Shares. At the time of or before taking any
action which would cause an adjustment pursuant to Paragraph 6 hereof increasing
the number of shares of
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capital stock constituting the Exercise Shares, the Company will take any
corporate action which may, in the opinion of its counsel, be necessary in order
that the Company have remaining, after such adjustment, a number of shares of
such capital stock unissued and unreserved for other purposes sufficient to
permit the exercise of all the then outstanding Warrants of like tenor
immediately after such adjustment; the Company will also from time to time take
action to increase the authorized amount of its capital stock constituting the
Exercise Shares if at any time the number of shares of capital stock authorized
but remaining unissued and unreserved for other purposes shall be insufficient
to permit the exercise of the Warrants then outstanding. The Company shall be
required to reserve and keep available, out of the aggregate of its authorized
but unissued shares of capital stock, for the purpose of enabling it to satisfy
any obligation to issue Exercise Shares upon exercise of Warrants, through the
Termination Date, the number of Exercise Shares deliverable upon the full
exercise of this Warrant and all other Warrants of like tenor then outstanding.
At the time of or before taking any action which would cause an
adjustment pursuant to Paragraph 6 hereof, reducing the Exercise Price below the
then par value (if any) of the Exercise Shares issuable upon exercise of the
Warrants, the Company will take any corporate action which may, in the opinion
of its counsel, be necessary in order to assure that the par value per share of
the Exercise Shares is at all times equal to or less than the Exercise Price per
share and so that the Company may validly and legally issue fully paid and
non-assessable Exercise Shares at the Exercise Price, as so adjusted. The
Company will also from time to time take such action if at any time the Exercise
Price is below the then par value of the Exercise Shares.
(e) Fractional Shares. The Company shall not be required to issue
fractional shares of capital stock upon the exercise of this Warrant or to
deliver Warrant Certificates which evidence fractional shares of capital stock.
In the event that any fraction of an Exercise Share would, except for the
provisions of this subparagraph (e), be issuable upon the exercise of this
Warrant, the Company shall pay to the Holder exercising the Warrant an amount in
cash equal to such fraction multiplied by the Current Market Value of the
Exercise Share. For purposes of this subparagraph (e), the Current Market Value
shall be determined as follows:
(i) if the Exercise Shares are traded on the over-the-counter market
and not on any national securities exchange and not on the NASDAQ Reporting
System, the average of the mean between the last bid and asked prices per share,
as reported by the National Quotation Bureau, Inc., or an equivalent generally
accepted reporting service, for the last business day prior to the date on which
this Warrant is exercised, or if not so reported, the average of the closing bid
and asked prices for an Exercise Share as furnished to the Company by any member
of the National Association of Securities Dealers, Inc., selected by the Company
for that purpose;
(ii) if the Exercise Shares are listed or traded on a national
securities exchange or on the NASDAQ National Market System, the closing price
on the principal national securities exchange on which they are so listed or
traded or on the NASDAQ National Market System, as the case may be, on the last
business day prior to the date of the exercise of this Warrant. The closing
price referred to in this clause (ii) shall be the last reported sales price or,
in case no such reported sale takes place on such day, the average of the
reported closing bid and
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asked prices, in either case on the national securities exchange on which the
Exercise Shares are then listed or in the NASDAQ Reporting System; or
(iii) if no such closing price or closing bid and asked prices
are available, as determined in any reasonable manner as may be prescribed by
the Board of Directors of the Company.
2. Payment of Taxes. The Company will pay all documentary stamp taxes, if
any, attributable to the initial issuance of Exercise Shares upon the exercise
of this Warrant; provided, however, that the Company shall not be required to
pay any tax or taxes which may be payable in respect of any transfer involved in
the issue of any Warrant Certificates or any certificates for Exercise Shares in
a name other than that of the Holder of a Warrant Certificate surrendered upon
the exercise of a Warrant, and the Company shall not be required to issue or
deliver such certificates unless or until the person or persons requesting the
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
3. Mutilated or Missing Warrant Certificates. In case any Warrant
Certificate shall be mutilated, lost, stolen or destroyed, the Company may in
its discretion issue, in exchange and substitution for and upon cancellation of
the mutilated Warrant Certificate, or in lieu of and in substitution for the
Warrant Certificate lost, stolen or destroyed, a new Warrant Certificate or
Warrant Certificates of like tenor and in the same aggregate denomination, but
only (i) in the case of loss, theft or destruction, upon receipt of evidence
satisfactory to the Company of such loss, theft or destruction of such Warrant
Certificate and indemnity or bond, if requested, also satisfactory to it; and
(ii) in the case of mutilation, upon surrender of the mutilated Warrant
Certificate. Applicants for such substitute Warrant Certificates shall also
comply with such other reasonable regulations and pay such other reasonable
charges as the Company or its counsel may prescribe.
4. Rights of Holder; No Impairment. The Holder shall not, by virtue of
anything contained in this Warrant Certificate or otherwise, be entitled to any
right whatsoever, either in law or equity, of a stockholder of the Company,
including without limitation, the right to receive dividends or to vote or to
consent or to receive notice as a shareholder in respect of the meetings of
shareholders or the election of directors of the Company or any other matter.
The Company will not amend its Certificate of Incorporation or participate in
any reorganization, consolidation, merger, dissolution, sale of assets or
similar voluntary action for the purpose of avoiding or seeking to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in carrying out all such action as may be reasonably
necessary in order to protect the rights of the Holder of this Warrant against
impairment.
5. Registration of Transfers and Exchanges. The Warrant shall be
transferable, subject to the provisions of Paragraph 7 hereof, only upon the
books of the Company if any, to be maintained by it for that purpose, upon
surrender of the Warrant Certificate to the Company at its principal office
accompanied (if so required by it) by a written instrument or instruments of
transfer in form satisfactory to the Company and duly executed by the Holder
thereof or by the
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<PAGE> 5
duly appointed legal representative thereof or by a duly authorized attorney and
upon payment of any necessary transfer tax or other governmental charge imposed
upon such transfer. In all cases of transfer by an attorney, the original letter
of attorney, duly approved, or an official copy thereof, duly certified, shall
be deposited and remain with the Company. In case of transfer by executors,
administrators, guardians or other legal representatives, duly authenticated
evidence of their authority shall be produced, and may be required to be
deposited and remain with the Company in its discretion. Upon any such
registration of transfer, a new Warrant Certificate shall be issued to the
transferee named in such instrument of transfer, and the surrendered Warrant
Certificate shall be canceled by the Company.
Any Warrant Certificate may be exchanged, at the option of the Holders
thereof and without change, when surrendered to the Company at its principal
office, or at the office of its transfer agent, if any, for another Warrant
Certificate or other Warrant Certificates of like tenor and representing in the
aggregate the right to purchase from the Company a like number and kind of
Exercise Shares as the Warrant Certificate surrendered for exchange or transfer,
and the Warrant Certificate so surrendered shall be canceled by the Company or
transfer agent, as the case may be.
6. Adjustment of Exercise Shares and Exercise Price. The Exercise Price
and the number and kind of Exercise Shares purchasable upon the exercise of this
Warrant shall be subject to adjustment from time to time upon the happening of
certain events as hereinafter provided. The Exercise Price in effect at any time
and the number and kind of securities purchasable upon exercise of each Warrant
shall be subject to adjustment as follows:
(a) In the case the Company shall (i) pay a dividend or make a
distribution on its shares of Common Stock in shares of Common Stock; (ii)
subdivide or classify its outstanding Common Stock into a greater number of
shares; or (iii) combine or reclassify its outstanding Common Stock into a
smaller number of shares, the Exercise Price in effect at the time of the record
date for such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be proportionally adjusted so
that the Holder of this Warrant exercised after such date shall be entitled to
receive the aggregate number and kind of shares which, if this Warrant had been
exercised by such Holder immediately prior to such date, he would have owned
upon such exercise and been entitled to receive upon such dividend, subdivision,
combination or reclassification. For example, if the Company declares a 2 for 1
stock dividend or stock split and the Exercise Price immediately prior to such
event was $3.00 per share, the adjusted Exercise Price immediately after such
event would be $1.50 per share. Such adjustment shall be made successively
whenever any event listed above shall occur.
(b) In case the Company shall hereafter issue rights or warrants to all
holders of its Common Stock entitling them to subscribe for or purchase shares
of Common Stock (or securities convertible into Common Stock) at a price (or
having a conversion price per share) less than the current market price of the
Common Stock (as defined in Subparagraph (d) below) on the record date mentioned
below, the Exercise Price shall be adjusted so that the same shall equal the
price determined by multiplying the Exercise Price in effect immediately prior
to the date of such issuance by a fraction, the numerator of which shall be the
sum of the number of shares of
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<PAGE> 6
Common Stock outstanding on the record date mentioned below and the number of
additional shares of Common Stock which the aggregate offering price of the
total number of shares of Common Stock so offered (or the aggregate conversion
price of the convertible securities so offered) would purchase at such current
market price per share of the Common Stock, and the denominator of which shall
be the sum of the number of shares of Common Stock outstanding on such record
date and the number of additional shares of Common Stock offered for
subscription or purchase (or into which the convertible securities so offered
are convertible). Such adjustment shall be made successively whenever such
rights or warrants are issued and shall become effective immediately after the
record date for the determination of shareholders entitled to receive such
rights or warrants; and to the extent that shares of Common Stock are not
delivered (or securities convertible into Common Stock are not delivered) after
the expiration of such rights or warrants the Exercise Price shall be readjusted
to the Exercise Price which would then be in effect had the adjustments made
upon the issuance of such rights or warrants been made upon the basis of
delivery of only the number of shares of Common Stock (or securities convertible
into Common Stock) actually delivered.
(c) Whenever the Exercise Price payable upon exercise of each Warrant
is adjusted pursuant to Subparagraphs (a) and (b) above, the number of Exercise
Shares purchasable upon exercise of this Warrant shall simultaneously be
adjusted by multiplying the number of Exercise Shares initially issuable upon
exercise of this Warrant by the Exercise Price in effect on the date hereof and
dividing the product so obtained by the Exercise Price, as adjusted.
(d) For the purpose of any computation under Subparagraph (b) above,
the current market price per share of Common Stock at any date shall be deemed
to be the average of the daily closing prices for 30 consecutive business days
before such date. The closing price for each day shall be the last sale price
regular way or, in case no such reported sale takes place on such day, the
average of the last reported bid and lowest reported asked prices as reported by
NASDAQ, or other similar organization if NASDAQ is no longer reporting such
information, or if not so available, the fair market price as determined by the
Board of Directors.
(e) No adjustment in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least ten cents ($0.10)
in such price; provided, however, that any adjustments which by reason of this
Subparagraph (e) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment required to be made hereunder. All
calculations under this Paragraph 6 shall be made to the nearest cent or to the
nearest one-hundredth of a share, as the case may be. Anything in this Paragraph
6 to the contrary notwithstanding, the Company shall be entitled, but shall not
be required, to make such changes in the Exercise Price, in addition to those
required by this Paragraph 6, as it, in its sole discretion, shall determine to
be advisable in order that any dividend or distribution in shares of Common
Stock, subdivision, reclassification or combination of Common Stock, issuance of
warrants to purchase Common Stock or distribution of evidences of indebtedness
or other assets (excluding cash dividends) referred to hereinabove in this
Paragraph 6 hereafter made by the Company to the holders of its Common Stock
shall not result in any tax to the holders of its Common Stock or securities
convertible into Common Stock.
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<PAGE> 7
(f) Whenever the Exercise Price is adjusted, as herein provided, the
Company shall promptly cause a notice setting forth the adjusted Exercise Price
and adjusted number of Shares issuable upon exercise of each Warrant to be
mailed to the Holders, at their last addresses appearing in the Warrant
Register, shall cause a certified copy thereof to be mailed to its transfer
agent, if any, and shall file in the custody of its Secretary or an Assistant
Secretary at its principal office and with its stock transfer agent, if any, an
officer's certificate showing the adjusted Exercise Price determined as herein
provided, setting forth in reasonable detail the facts requiring such
adjustment, including a statement of the number of additional shares of Common
Stock, if any, and such other facts as shall be necessary to show the reason for
and the manner of computing such adjustment. The Company may retain a firm of
independent certified public accountants selected by the Board of Directors (who
may be the regular accountants employed by the Company) to make any computation
required by this Paragraph 6, and a certificate signed by such firm shall be
conclusive evidence of the correctness of such adjustment.
(g) In the event that at any time, as a result of an adjustment made
pursuant to Subparagraph (a) above, the Holder of this Warrant thereafter shall
become entitled to receive any Exercise Shares of the Company, other than Common
Stock, thereafter the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with respect to the
Common Stock contained in Subparagraphs (a) to (e), inclusive above.
(h) Irrespective of any adjustments in the Exercise Price or the number
or kind of Exercise Shares purchasable upon exercise of this Warrant, Warrants
theretofore or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the similar Warrants initially
issuable pursuant to this Agreement.
7. Restrictions on Transferability; Restrictive Legend. Neither this
Warrant nor the Exercise Shares shall be transferable except in accordance with
the provisions of this paragraph.
(a) Restrictions on Transfer; Indemnification. Neither this Warrant nor
any Exercise Share may be offered for sale or sold, or otherwise transferred or
sold in any transaction which would constitute a sale thereof within the meaning
of the Securities Act, unless (i) such security has been registered for sale
under the Securities Act and registered or qualified under applicable state
securities laws relating to the offer and sale of securities; or (ii) exemptions
from the registration requirements of the Securities Act and the registration or
qualification requirements of all such state securities laws are available and
the Company shall have received an opinion of counsel satisfactory to the
Company that the proposed sale or other disposition of such securities may be
effected without registration under the Securities Act and would not result in
any violation of any applicable state securities laws relating to the
registration or qualification of securities for sale, such counsel and such
opinion to be satisfactory to the Company.
The Holder agrees to indemnify and hold harmless the Company against
any loss, damage, claim or liability arising from the disposition of this
Warrant or any Exercise Share held by such holder or any interest therein in
violation of the provisions of this Paragraph 7.
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<PAGE> 8
(b) Investment Letter Agreement. This Warrant and the exercise shares
are subject to the terms contained within that certain Investment Letter
Agreement by and between the Company and the Holder dated April 21, 1998.
(c) Restrictive Legends. Unless and until otherwise permitted by this
Paragraph 7 or in the Agreement, this Warrant Certificate, each Warrant
Certificate issued to the Holder or to any transferee or assignee of this
Warrant Certificate, and each Certificate representing Exercise Shares issued
upon exercise of this Warrant or to any transferee of the person to whom the
Exercise Shares were issued, shall bear a legend setting forth the requirements
of paragraph (a) of this Paragraph 7, together with such other legend or legends
as may otherwise be deemed necessary or appropriate by counsel to the Company.
(d) Notice of Proposed Transfers. Prior to any transfer, offer to
transfer or attempted transfer of this Warrant or any Exercise Share, the holder
of such security shall give written notice to the Company of such holder's
intention to effect such transfer. Each such notice shall (x) describe the
manner and circumstances of the proposed transfer in sufficient detail, and
shall contain an undertaking by the person giving such notice to furnish such
other information as may be required, to enable counsel to render the opinion
referred to below, and shall (y) designate the counsel for the person giving
such notice, such counsel to be satisfactory to the Company. The person giving
such notice shall submit a copy thereof to the counsel designated in such notice
and to the Company and the following provisions shall apply.
(i) If, in the opinion of such counsel, the proposed
transfer of this Warrant or Exercise Share, as appropriate, may be effected
without registration of such security under the Securities Act, and such opinion
and such counsel are acceptable to the Company, the Company shall, as promptly
as practicable, so notify the holder of such security and such holder shall
thereupon be entitled to transfer such security in accordance with the terms of
the notice delivered by such holder to the Company. Each certificate evidencing
the securities thus to be transferred (and each certificate evidencing any
untransferred balance of the securities evidenced by such certificate) shall
bear the restrictive legends referred to in subparagraph (c) above, unless in
the opinion of such counsel such legend is not required in order to insure
compliance with the Securities Act and such opinion and such counsel are
acceptable to the Company.
(ii) If the opinion of such counsel is not acceptable
to the Company, the Company shall, as promptly as practicable, so notify the
holder thereof. However, the Company shall have no obligation to register such
securities under the Securities Act, except as otherwise provided herein or in
the Registration Rights Agreement.
The holder of the securities giving the notice under this subparagraph
(d) shall not be entitled to transfer any of the securities until receipt of
notice from the Company under paragraph (i) of this subparagraph (d) or
registration of such securities under the Securities Act has become effective.
(e) Removal of Legend. The Company shall, at the request of any
registered holder of a Warrant or Exercise Share, exchange the certificate
representing such security for a certificate representing the same security not
bearing the restrictive legend required by
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<PAGE> 9
subparagraph (c) if, in the opinion of counsel to the Company, such restrictive
legend is no longer necessary.
8. Notices. All notices or other communications under this Warrant
Certificate shall be in writing and shall be deemed to have been given if
delivered by hand or mailed by certified mail, postage prepaid, return receipt
request, addressed as follows:
If to the Company:
Dominion Bridge Corporation
500 Notre Dame
Lachine, Quebec, Canada H8S 2B2
Attention: Chief Executive Officer
With a Copy to:
Joseph P. Galda, Esquire
Buchanan Ingersoll Professional Corporation
11 Penn Center - 14th Floor
1835 Market Street
Philadelphia, PA 19103-2985
if to the Holder:
Wellgate International Ltd.
c/o Pouliot Mercure
CIBC Tower- 31st Floor
1155 Rene-Levesque Blvd. West
Monteal, Quebec, Canada H3B 3S6
Attention: J. Brian Riordan
Either of the Company or the Holder may from time to time
change the address to which notices to it are to be mailed hereunder by notice
in accordance with the provisions of this Paragraph 8.
Such notices and other communications shall for all purposes
of this Agreement be treated as being effective upon being delivered personally
or, if sent by mail, five (5) days after the same has been deposited in a
regularly maintained receptacle for the deposit of United States mail, addressed
as set forth above, and postage prepaid.
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<PAGE> 10
9. Registration Rights. The Holder shall be entitled to the
registration rights set forth in that certain Registration Rights Agreement
dated as of April 21, 1998 by and among, inter alia, the Company and such
Holder.
10. Supplements and Amendments. The Company may from time to time
supplement or amend this Warrant without the approval of any Holders of Warrants
in order to cure any ambiguity or to correct or supplement any provision
contained herein which may be defective or inconsistent with any other
provision, or to make any other provisions in regard to matters or questions
herein arising hereunder which the Company may deem necessary or desirable and
which shall not materially adversely affect the interests of the Holder.
11. Successors and Assigns. This Warrant shall inure to the benefit of
and be binding on the respective successors, assigns and legal representatives
of the Holder and the Company.
12. Severability. If for any reason any provision, paragraph or term of
this Warrant is held to be invalid or unenforceable, all other valid provisions
herein shall remain in full force and effect and all terms, provisions and
paragraphs of this Warrant shall be deemed to be severable.
13. Governing Law. This Warrant shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be governed
by and construed in accordance with the laws of said State.
14. Headings. Paragraph and subparagraph headings, used herein are
included herein for convenience of reference only shall not affect the
construction of this Warrant nor constitute a part of this Warrant for any other
purpose.
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<PAGE> 11
IN WITNESS WHEREOF, the Company has caused these presents to be duly
executed the day and year defined herein as the "Commencement Date."
DOMINION BRIDGE CORPORATION
By: /s/ ALLEN S. GERRARD
------------------------------
Name: Allen S. Gerrard
Title: Director
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<PAGE> 12
APPENDIX A
NOTICE OF WARRANT EXERCISE
Pursuant to a Warrant by and between the undersigned and DOMINION
BRIDGE CORPORATION, a Delaware corporation (the "Company"), dated as of April
21, 1998, the undersigned hereby irrevocably elects to exercise its warrant to
the extent of purchasing ______________ shares of Common Stock, $.001 par value
per share (the "Exercise Shares"), of the Company as provided for therein.
The undersigned hereby represents and agrees that the Exercise Shares
purchased pursuant hereto are being purchased for investment and not with a view
to the distribution or resale thereof, and that the undersigned understands that
said Exercise Shares have not been registered under the Securities Act of 1933,
as amended.
Payment of the full Purchase Price of the Exercise Shares is enclosed
herewith, in the form of a check made payable to the Company.
The undersigned requests that a certificate for the Exercise Shares be
issued in the name of:
------------------------------------------------
------------------------------------------------
------------------------------------------------
(Please print name, address and social security number)
Dated: ,
---------------------------------- ---------
Address:
---------------------------------------------
---------------------------------------------
Signature:
-------------------------------------------
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<PAGE> 1
EXHIBIT 4.2
FORM
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES
REPRESENTED BY THIS CERTIFICATE HAVE BEEN TAKEN BY THE REGISTERED OWNER
FOR INVESTMENT, AND WITHOUT A VIEW TO RESALE OR DISTRIBUTION THEREOF,
AND MAY NOT BE TRANSFERRED OR DISPOSED OF WITHOUT AN OPINION OF COUNSEL
SATISFACTORY TO THE ISSUER THAT SUCH TRANSFER OR DISPOSITION DOES NOT
VIOLATE THE SECURITIES ACT OF 1933, AS AMENDED, OR THE RULES AND
REGULATIONS THEREUNDER.
WARRANT TO PURCHASE
COMMON STOCK OF
DOMINION BRIDGE CORPORATION
Void after 5:00 p.m. Eastern Standard Time on April 20, 2001.
This is to verify that, FOR VALUE RECEIVED, LAMAR INVESTMENTS, INC., a
corporation organized under the laws of Illinois (hereinafter referred to as the
"Holder"), with a principal address at 650 Dundee Road, Suite 640, Northbrook,
IL 60062, is entitled to purchase, subject to the terms and conditions hereof,
from DOMINION BRIDGE CORPORATION (the "Company") ********** shares of Common
Stock, $.001 par value per share (the "Common Stock"), during the period
commencing at 9:00 a.m., Eastern Standard Time on April 21, 1998 (the
"Commencement Date") and ending at 5:00 p.m. Eastern Standard Time on April 20,
2001 (the "Termination Date") at an exercise price of $3.00 per share of Common
Stock. The number of shares of Common Stock purchasable upon exercise of this
Warrant (the "Warrant(s)") and the exercise price per share shall be subject to
adjustment from time to time upon the occurrence of certain events as set forth
below.
The shares of Common Stock or any other shares or other units of stock
or other securities or property, or any combination thereof then receivable upon
exercise of this Warrant, as adjusted from time to time, are sometimes referred
to hereinafter as "Exercise Shares". The exercise price per share as from time
to time in effect is referred to hereinafter as the "Exercise Price".
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<PAGE> 2
1. Exercise of Warrant; Issuance of Exercise Shares.
(a) Exercise of Warrant. This Warrant may be exercised in whole or in
part at any time or from time to time on or after the Commencement Date and
until and including the Termination Date. This Warrant may be surrendered on any
business day to the Company at its principal office, presently located at the
address of the Company set forth in Paragraph 9 hereof, (or such other office of
the Company, if any, as shall theretofore have been designated by the Company by
written notice to the Holder), together with: (i) a completed and executed
Notice of Warrant Exercise in the form set forth in Appendix A hereto and made a
part hereof; and (ii) payment of the full Exercise Price for the amount of
Exercise Shares set forth in the Notice of Warrant Exercise, in lawful money of
the United States of America by certified check or cashier's check, made payable
to the order of the Company, together with certification of investment intent
and such other agreements, representations and warranties as counsel for the
Company shall require to establish an exemption from the registration
requirements of the Securities Act of 1933, as amended (the "Securities Act").
Notwithstanding anything contained herein to the contrary, prior to any exercise
of this Warrant, Holder shall take all actions required in the reasonable
judgment of the Company to comply with Australian Securities laws in connection
with such exercise.
In the event that this Warrant shall be duly exercised in part prior to
the Termination Date, the Company shall issue a new Warrant Certificate of like
tenor evidencing the rights of the Holder thereof to purchase the balance of the
Exercise Shares purchasable under the Warrant so surrendered that shall not have
been purchased.
The Company shall cancel Warrant Certificates surrendered upon exercise
of Warrants.
(b) Issuance of Exercise Shares; Delivery of Certificates. The Company
shall, within five (5) business days or as soon thereafter as is practicable of
the exercise of this Warrant, issue in the name of and cause to be delivered to
the Holder (or such other person or persons, if any, as the Holder shall have
designated in the Notice of Warrant Exercise) one or more certificates
representing the Exercise Shares to which the Holder (or such other person or
persons) shall be entitled upon such exercise under the terms hereof. Such
certificate or certificates shall be deemed to have been issued and the Holder
(or such other person or persons so designated) shall be deemed to have become
the record holder of the Exercise Shares as of the date of the due exercise of
this Warrant.
(c) Exercise Shares Fully Paid and Non-assessable. The Company agrees
and covenants that all Exercise Shares issuable upon the due exercise of the
Warrant represented by this Warrant Certificate will, upon issuance in
accordance with the terms hereof, be duly authorized, validly issued, fully paid
and non-assessable and free and clear of all taxes (other than taxes which,
pursuant to Paragraph 2 hereof, the Company shall not be obligated to pay) or
liens, charges, and security interests created by the Company with respect to
the issuance thereof.
(d) Reservation of Exercise Shares. At the time of or before taking any
action which would cause an adjustment pursuant to Paragraph 6 hereof increasing
the number of shares of
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<PAGE> 3
capital stock constituting the Exercise Shares, the Company will take any
corporate action which may, in the opinion of its counsel, be necessary in order
that the Company have remaining, after such adjustment, a number of shares of
such capital stock unissued and unreserved for other purposes sufficient to
permit the exercise of all the then outstanding Warrants of like tenor
immediately after such adjustment; the Company will also from time to time take
action to increase the authorized amount of its capital stock constituting the
Exercise Shares if at any time the number of shares of capital stock authorized
but remaining unissued and unreserved for other purposes shall be insufficient
to permit the exercise of the Warrants then outstanding. The Company shall be
required to reserve and keep available, out of the aggregate of its authorized
but unissued shares of capital stock, for the purpose of enabling it to satisfy
any obligation to issue Exercise Shares upon exercise of Warrants, through the
Termination Date, the number of Exercise Shares deliverable upon the full
exercise of this Warrant and all other Warrants of like tenor then outstanding.
At the time of or before taking any action which would cause an
adjustment pursuant to Paragraph 6 hereof, reducing the Exercise Price below the
then par value (if any) of the Exercise Shares issuable upon exercise of the
Warrants, the Company will take any corporate action which may, in the opinion
of its counsel, be necessary in order to assure that the par value per share of
the Exercise Shares is at all times equal to or less than the Exercise Price per
share and so that the Company may validly and legally issue fully paid and
non-assessable Exercise Shares at the Exercise Price, as so adjusted. The
Company will also from time to time take such action if at any time the Exercise
Price is below the then par value of the Exercise Shares.
(e) Fractional Shares. The Company shall not be required to issue
fractional shares of capital stock upon the exercise of this Warrant or to
deliver Warrant Certificates which evidence fractional shares of capital stock.
In the event that any fraction of an Exercise Share would, except for the
provisions of this subparagraph (e), be issuable upon the exercise of this
Warrant, the Company shall pay to the Holder exercising the Warrant an amount in
cash equal to such fraction multiplied by the Current Market Value of the
Exercise Share. For purposes of this subparagraph (e), the Current Market Value
shall be determined as follows:
(i) if the Exercise Shares are traded on the over-the-counter
market and not on any national securities exchange and not on the NASDAQ
Reporting System, the average of the mean between the last bid and asked prices
per share, as reported by the National Quotation Bureau, Inc., or an equivalent
generally accepted reporting service, for the last business day prior to the
date on which this Warrant is exercised, or if not so reported, the average of
the closing bid and asked prices for an Exercise Share as furnished to the
Company by any member of the National Association of Securities Dealers, Inc.,
selected by the Company for that purpose;
(ii) if the Exercise Shares are listed or traded on a national
securities exchange or on the NASDAQ National Market System, the closing price
on the principal national securities exchange on which they are so listed or
traded or on the NASDAQ National Market System, as the case may be, on the last
business day prior to the date of the exercise of this Warrant. The closing
price referred to in this clause (ii) shall be the last reported sales price or,
in case no such reported sale takes place on such day, the average of the
reported closing bid and
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<PAGE> 4
asked prices, in either case on the national securities exchange on which the
Exercise Shares are then listed or in the NASDAQ Reporting System; or
(iii) if no such closing price or closing bid and asked prices
are available, as determined in any reasonable manner as may be prescribed by
the Board of Directors of the Company.
2. Payment of Taxes. The Company will pay all documentary stamp taxes,
if any, attributable to the initial issuance of Exercise Shares upon the
exercise of this Warrant; provided, however, that the Company shall not be
required to pay any tax or taxes which may be payable in respect of any transfer
involved in the issue of any Warrant Certificates or any certificates for
Exercise Shares in a name other than that of the Holder of a Warrant Certificate
surrendered upon the exercise of a Warrant, and the Company shall not be
required to issue or deliver such certificates unless or until the person or
persons requesting the issuance thereof shall have paid to the Company the
amount of such tax or shall have established to the satisfaction of the Company
that such tax has been paid.
3. Mutilated or Missing Warrant Certificates. In case any Warrant
Certificate shall be mutilated, lost, stolen or destroyed, the Company may in
its discretion issue, in exchange and substitution for and upon cancellation of
the mutilated Warrant Certificate, or in lieu of and in substitution for the
Warrant Certificate lost, stolen or destroyed, a new Warrant Certificate or
Warrant Certificates of like tenor and in the same aggregate denomination, but
only (i) in the case of loss, theft or destruction, upon receipt of evidence
satisfactory to the Company of such loss, theft or destruction of such Warrant
Certificate and indemnity or bond, if requested, also satisfactory to it; and
(ii) in the case of mutilation, upon surrender of the mutilated Warrant
Certificate. Applicants for such substitute Warrant Certificates shall also
comply with such other reasonable regulations and pay such other reasonable
charges as the Company or its counsel may prescribe.
4. Rights of Holder; No Impairment. The Holder shall not, by virtue of
anything contained in this Warrant Certificate or otherwise, be entitled to any
right whatsoever, either in law or equity, of a stockholder of the Company,
including without limitation, the right to receive dividends or to vote or to
consent or to receive notice as a shareholder in respect of the meetings of
shareholders or the election of directors of the Company or any other matter.
The Company will not amend its Certificate of Incorporation or participate in
any reorganization, consolidation, merger, dissolution, sale of assets or
similar voluntary action for the purpose of avoiding or seeking to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in carrying out all such action as may be reasonably
necessary in order to protect the rights of the Holder of this Warrant against
impairment.
5. Registration of Transfers and Exchanges. The Warrant shall be
transferable, subject to the provisions of Paragraph 7 hereof, only upon the
books of the Company if any, to be maintained by it for that purpose, upon
surrender of the Warrant Certificate to the Company at its principal office
accompanied (if so required by it) by a written instrument or instruments of
transfer in form satisfactory to the Company and duly executed by the Holder
thereof or by the
4
<PAGE> 5
duly appointed legal representative thereof or by a duly authorized attorney and
upon payment of any necessary transfer tax or other governmental charge imposed
upon such transfer. In all cases of transfer by an attorney, the original letter
of attorney, duly approved, or an official copy thereof, duly certified, shall
be deposited and remain with the Company. In case of transfer by executors,
administrators, guardians or other legal representatives, duly authenticated
evidence of their authority shall be produced, and may be required to be
deposited and remain with the Company in its discretion. Upon any such
registration of transfer, a new Warrant Certificate shall be issued to the
transferee named in such instrument of transfer, and the surrendered Warrant
Certificate shall be canceled by the Company.
Any Warrant Certificate may be exchanged, at the option of the Holders
thereof and without change, when surrendered to the Company at its principal
office, or at the office of its transfer agent, if any, for another Warrant
Certificate or other Warrant Certificates of like tenor and representing in the
aggregate the right to purchase from the Company a like number and kind of
Exercise Shares as the Warrant Certificate surrendered for exchange or transfer,
and the Warrant Certificate so surrendered shall be canceled by the Company or
transfer agent, as the case may be.
6. Adjustment of Exercise Shares and Exercise Price. The Exercise Price
and the number and kind of Exercise Shares purchasable upon the exercise of this
Warrant shall be subject to adjustment from time to time upon the happening of
certain events as hereinafter provided. The Exercise Price in effect at any time
and the number and kind of securities purchasable upon exercise of each Warrant
shall be subject to adjustment as follows:
(a) In the case the Company shall (i) pay a dividend or make a
distribution on its shares of Common Stock in shares of Common Stock; (ii)
subdivide or classify its outstanding Common Stock into a greater number of
shares; or (iii) combine or reclassify its outstanding Common Stock into a
smaller number of shares, the Exercise Price in effect at the time of the record
date for such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be proportionally adjusted so
that the Holder of this Warrant exercised after such date shall be entitled to
receive the aggregate number and kind of shares which, if this Warrant had been
exercised by such Holder immediately prior to such date, he would have owned
upon such exercise and been entitled to receive upon such dividend, subdivision,
combination or reclassification. For example, if the Company declares a 2 for 1
stock dividend or stock split and the Exercise Price immediately prior to such
event was $3.00 per share, the adjusted Exercise Price immediately after such
event would be $1.50 per share. Such adjustment shall be made successively
whenever any event listed above shall occur.
(b) In case the Company shall hereafter issue rights or warrants to all
holders of its Common Stock entitling them to subscribe for or purchase shares
of Common Stock (or securities convertible into Common Stock) at a price (or
having a conversion price per share) less than the current market price of the
Common Stock (as defined in Subparagraph (d) below) on the record date mentioned
below, the Exercise Price shall be adjusted so that the same shall equal the
price determined by multiplying the Exercise Price in effect immediately prior
to the date of such issuance by a fraction, the numerator of which shall be the
sum of the number of shares of
5
<PAGE> 6
Common Stock outstanding on the record date mentioned below and the number of
additional shares of Common Stock which the aggregate offering price of the
total number of shares of Common Stock so offered (or the aggregate conversion
price of the convertible securities so offered) would purchase at such current
market price per share of the Common Stock, and the denominator of which shall
be the sum of the number of shares of Common Stock outstanding on such record
date and the number of additional shares of Common Stock offered for
subscription or purchase (or into which the convertible securities so offered
are convertible). Such adjustment shall be made successively whenever such
rights or warrants are issued and shall become effective immediately after the
record date for the determination of shareholders entitled to receive such
rights or warrants; and to the extent that shares of Common Stock are not
delivered (or securities convertible into Common Stock are not delivered) after
the expiration of such rights or warrants the Exercise Price shall be readjusted
to the Exercise Price which would then be in effect had the adjustments made
upon the issuance of such rights or warrants been made upon the basis of
delivery of only the number of shares of Common Stock (or securities convertible
into Common Stock) actually delivered.
(c) Whenever the Exercise Price payable upon exercise of each Warrant
is adjusted pursuant to Subparagraphs (a) and (b) above, the number of Exercise
Shares purchasable upon exercise of this Warrant shall simultaneously be
adjusted by multiplying the number of Exercise Shares initially issuable upon
exercise of this Warrant by the Exercise Price in effect on the date hereof and
dividing the product so obtained by the Exercise Price, as adjusted.
(d) For the purpose of any computation under Subparagraph (b) above,
the current market price per share of Common Stock at any date shall be deemed
to be the average of the daily closing prices for 30 consecutive business days
before such date. The closing price for each day shall be the last sale price
regular way or, in case no such reported sale takes place on such day, the
average of the last reported bid and lowest reported asked prices as reported by
NASDAQ, or other similar organization if NASDAQ is no longer reporting such
information, or if not so available, the fair market price as determined by the
Board of Directors.
(e) No adjustment in the Exercise Price shall be required unless such
adjustment would require an increase or decrease of at least ten cents ($0.10)
in such price; provided, however, that any adjustments which by reason of this
Subparagraph (e) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment required to be made hereunder. All
calculations under this Paragraph 6 shall be made to the nearest cent or to the
nearest one-hundredth of a share, as the case may be. Anything in this Paragraph
6 to the contrary notwithstanding, the Company shall be entitled, but shall not
be required, to make such changes in the Exercise Price, in addition to those
required by this Paragraph 6, as it, in its sole discretion, shall determine to
be advisable in order that any dividend or distribution in shares of Common
Stock, subdivision, reclassification or combination of Common Stock, issuance of
warrants to purchase Common Stock or distribution of evidences of indebtedness
or other assets (excluding cash dividends) referred to hereinabove in this
Paragraph 6 hereafter made by the Company to the holders of its Common Stock
shall not result in any tax to the holders of its Common Stock or securities
convertible into Common Stock.
6
<PAGE> 7
(f) Whenever the Exercise Price is adjusted, as herein provided, the
Company shall promptly cause a notice setting forth the adjusted Exercise Price
and adjusted number of Shares issuable upon exercise of each Warrant to be
mailed to the Holders, at their last addresses appearing in the Warrant
Register, shall cause a certified copy thereof to be mailed to its transfer
agent, if any, and shall file in the custody of its Secretary or an Assistant
Secretary at its principal office and with its stock transfer agent, if any, an
officer's certificate showing the adjusted Exercise Price determined as herein
provided, setting forth in reasonable detail the facts requiring such
adjustment, including a statement of the number of additional shares of Common
Stock, if any, and such other facts as shall be necessary to show the reason for
and the manner of computing such adjustment. The Company may retain a firm of
independent certified public accountants selected by the Board of Directors (who
may be the regular accountants employed by the Company) to make any computation
required by this Paragraph 6, and a certificate signed by such firm shall be
conclusive evidence of the correctness of such adjustment.
(g) In the event that at any time, as a result of an adjustment made
pursuant to Subparagraph (a) above, the Holder of this Warrant thereafter shall
become entitled to receive any Exercise Shares of the Company, other than Common
Stock, thereafter the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with respect to the
Common Stock contained in Subparagraphs (a) to (e), inclusive above.
(h) Irrespective of any adjustments in the Exercise Price or the number
or kind of Exercise Shares purchasable upon exercise of this Warrant, Warrants
theretofore or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the similar Warrants initially
issuable pursuant to this Agreement.
7. Restrictions on Transferability; Restrictive Legend. Neither this
Warrant nor the Exercise Shares shall be transferable except in accordance with
the provisions of this paragraph.
(a) Restrictions on Transfer; Indemnification. Neither this Warrant nor
any Exercise Share may be offered for sale or sold, or otherwise transferred or
sold in any transaction which would constitute a sale thereof within the meaning
of the Securities Act, unless (i) such security has been registered for sale
under the Securities Act and registered or qualified under applicable state
securities laws relating to the offer and sale of securities; or (ii) exemptions
from the registration requirements of the Securities Act and the registration or
qualification requirements of all such state securities laws are available and
the Company shall have received an opinion of counsel satisfactory to the
Company that the proposed sale or other disposition of such securities may be
effected without registration under the Securities Act and would not result in
any violation of any applicable state securities laws relating to the
registration or qualification of securities for sale, such counsel and such
opinion to be satisfactory to the Company.
The Holder agrees to indemnify and hold harmless the Company against
any loss, damage, claim or liability arising from the disposition of this
Warrant or any Exercise Share held by such holder or any interest therein in
violation of the provisions of this Paragraph 7.
7
<PAGE> 8
(b) Investment Letter Agreement. This Warrant and the exercise shares
are subject to the terms contained within that certain Investment Letter
Agreement by and between the Company and the Holder dated April 21, 1998.
(c) Restrictive Legends. Unless and until otherwise permitted by this
Paragraph 7 or in the Agreement, this Warrant Certificate, each Warrant
Certificate issued to the Holder or to any transferee or assignee of this
Warrant Certificate, and each Certificate representing Exercise Shares issued
upon exercise of this Warrant or to any transferee of the person to whom the
Exercise Shares were issued, shall bear a legend setting forth the requirements
of paragraph (a) of this Paragraph 7, together with such other legend or legends
as may otherwise be deemed necessary or appropriate by counsel to the Company.
(d) Notice of Proposed Transfers. Prior to any transfer, offer to
transfer or attempted transfer of this Warrant or any Exercise Share, the holder
of such security shall give written notice to the Company of such holder's
intention to effect such transfer. Each such notice shall (x) describe the
manner and circumstances of the proposed transfer in sufficient detail, and
shall contain an undertaking by the person giving such notice to furnish such
other information as may be required, to enable counsel to render the opinion
referred to below, and shall (y) designate the counsel for the person giving
such notice, such counsel to be satisfactory to the Company. The person giving
such notice shall submit a copy thereof to the counsel designated in such notice
and to the Company and the following provisions shall apply.
(i) If, in the opinion of such counsel, the
proposed transfer of this Warrant or Exercise Share, as appropriate, may be
effected without registration of such security under the Securities Act, and
such opinion and such counsel are acceptable to the Company, the Company shall,
as promptly as practicable, so notify the holder of such security and such
holder shall thereupon be entitled to transfer such security in accordance with
the terms of the notice delivered by such holder to the Company. Each
certificate evidencing the securities thus to be transferred (and each
certificate evidencing any untransferred balance of the securities evidenced by
such certificate) shall bear the restrictive legends referred to in subparagraph
(c) above, unless in the opinion of such counsel such legend is not required in
order to insure compliance with the Securities Act and such opinion and such
counsel are acceptable to the Company.
(ii) If the opinion of such counsel is not
acceptable to the Company, the Company shall, as promptly as practicable, so
notify the holder thereof. However, the Company shall have no obligation to
register such securities under the Securities Act, except as otherwise provided
herein or in the Registration Rights Agreement.
The holder of the securities giving the notice under this subparagraph
(d) shall not be entitled to transfer any of the securities until receipt of
notice from the Company under paragraph (i) of this subparagraph (d) or
registration of such securities under the Securities Act has become effective.
(e) Removal of Legend. The Company shall, at the request of any
registered holder of a Warrant or Exercise Share, exchange the certificate
representing such security for a certificate representing the same security not
bearing the restrictive legend required by
8
<PAGE> 9
subparagraph (c) if, in the opinion of counsel to the Company, such restrictive
legend is no longer necessary.
8. Notices. All notices or other communications under this Warrant
Certificate shall be in writing and shall be deemed to have been given if
delivered by hand or mailed by certified mail, postage prepaid, return receipt
request, addressed as follows:
If to the Company:
Dominion Bridge Corporation
500 Notre Dame
Lachine, Quebec, Canada H8S 2B2
Attention: Chief Executive Officer
With a Copy to:
Joseph P. Galda, Esquire
Buchanan Ingersoll Professional Corporation
11 Penn Center - 14th Floor
1835 Market Street
Philadelphia, PA 19103-2985
if to the Holder:
Lamar Investments, Inc.
650 Dundee Road
Suite 640
Northbrook, IL 60062
Attention: Douglas A. Gerrard
With a Copy to:
Gary I. Levenstein, Esquire
Ungaretti & Harris
3500 Three First National Plaza
Chicago, IL 60602-4283
Either of the Company or the Holder may from time to time
change the address to which notices to it are to be mailed hereunder by notice
in accordance with the provisions of this Paragraph 8.
9
<PAGE> 10
Such notices and other communications shall for all purposes
of this Agreement be treated as being effective upon being delivered personally
or, if sent by mail, five (5) days after the same has been deposited in a
regularly maintained receptacle for the deposit of United States mail, addressed
as set forth above, and postage prepaid.
9. Registration Rights. The Holder shall be entitled to the registration
rights set forth in that certain Registration Rights Agreement dated as of April
21, 1998 by and among, inter alia, the Company and such Holder.
10. Supplements and Amendments. The Company may from time to time
supplement or amend this Warrant without the approval of any Holders of Warrants
in order to cure any ambiguity or to correct or supplement any provision
contained herein which may be defective or inconsistent with any other
provision, or to make any other provisions in regard to matters or questions
herein arising hereunder which the Company may deem necessary or desirable and
which shall not materially adversely affect the interests of the Holder.
11. Successors and Assigns. This Warrant shall inure to the benefit of and
be binding on the respective successors, assigns and legal representatives of
the Holder and the Company.
12. Severability. If for any reason any provision, paragraph or term of
this Warrant is held to be invalid or unenforceable, all other valid provisions
herein shall remain in full force and effect and all terms, provisions and
paragraphs of this Warrant shall be deemed to be severable.
13. Governing Law. This Warrant shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be governed
by and construed in accordance with the laws of said State.
14. Headings. Paragraph and subparagraph headings, used herein are included
herein for convenience of reference only shall not affect the construction of
this Warrant nor constitute a part of this Warrant for any other purpose.
10
<PAGE> 11
IN WITNESS WHEREOF, the Company has caused these presents to be duly
executed the day and year defined herein as the "Commencement Date."
DOMINION BRIDGE CORPORATION
By: FORM
Name:
--------------------------
Title: Director
11
<PAGE> 12
APPENDIX A
NOTICE OF WARRANT EXERCISE
Pursuant to a Warrant by and between the undersigned and DOMINION
BRIDGE CORPORATION, a Delaware corporation (the "Company"), dated as of April
21, 1998, the undersigned hereby irrevocably elects to exercise its warrant to
the extent of purchasing *********** shares of Common Stock, $.001 par value per
share (the "Exercise Shares"), of the Company as provided for therein.
The undersigned hereby represents and agrees that the Exercise Shares
purchased pursuant hereto are being purchased for investment and not with a view
to the distribution or resale thereof, and that the undersigned understands that
said Exercise Shares have not been registered under the Securities Act of 1933,
as amended.
Payment of the full Purchase Price of the Exercise Shares is enclosed
herewith, in the form of a check made payable to the Company.
The undersigned requests that a certificate for the Exercise Shares be
issued in the name of:
------------------------------------------------
------------------------------------------------
------------------------------------------------
(Please print name, address and social security number)
Dated:
------------------------------------------------
Address:
----------------------------------------------
----------------------------------------------
----------------------------------------------
Signature:
--------------------------------------------
12
<PAGE> 1
EXHIBIT 4.3
FORM
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. THE SECURITIES REPRESENTED HEREBY HAVE BEEN TAKEN BY
THE REGISTERED OWNER FOR INVESTMENT, AND WITHOUT A VIEW TO RESALE OR
DISTRIBUTION THEREOF, AND MAY NOT BE TRANSFERRED OR DISPOSED OF WITHOUT AN
OPINION OF COUNSEL SATISFACTORY TO DOMINION BRIDGE CORPORATION THAT SUCH
TRANSFER OR DISPOSITION DOES NOT VIOLATE THE SECURITIES ACT OF 1933, AS AMENDED,
OR THE RULES AND REGULATIONS THEREUNDER.
REVOLVING CONVERTIBLE PROMISSORY NOTE
$10,000,000.00 Chicago, Illinois
April __, 1998
FOR VALUE RECEIVED, the undersigned, Groupe Cedar Canada, Inc./Cedar
Group Canada Inc., a Canadian corporation ("Borrower"), hereby unconditionally
promises to pay to the order of Pouliot Mercure, g.p., as Agent (the "Agent")
for the benefit of Lamar Investments, Inc., an Illinois corporation ("Lamar"),
at the Agent's office at 1155 Rene-Levesque Boulevard West, Suite 3100,
Montreal, Quebec, Canada H3B 3S6, or at such other place as the Agent may from
time to time designate in writing, in lawful money of the United States of
America and in immediately available funds, the unpaid principal sum of the
advances made by Lamar to the Borrower pursuant to subsection 2.1 of the "Credit
Agreement" (as hereinafter defined) up to Ten Million and No/100 Dollars
($10,000,000.00). This Revolving Convertible Promissory Note is referred to in,
and was executed and delivered pursuant to, that certain Credit Agreement, of
even date herewith, among Lamar, Wellgate (as defined therein) and Borrower (the
"Credit Agreement") to which reference is hereby made for a statement of the
terms and conditions under which the loans evidenced hereby were made and are to
be repaid.
The indebtedness evidenced hereby shall be for a term ending on the
Termination Date (as defined in the Credit Agreement). In addition to the
foregoing payments, Borrower shall pay to Lamar the mandatory repayments
referred to in, and in accordance with, subsection 3.2 of the Credit Agreement.
Borrower may use this Revolving Convertible Promissory Note to borrow, repay the
loan in whole or in part, and reborrow, all in accordance with the terms and
conditions of the Credit Agreement and this Revolving Convertible Promissory
Note.
Borrower further promises to pay interest on the outstanding unpaid
principal amount hereof, as provided in the Credit Agreement, from the date
hereof until payment in full hereof, at
<PAGE> 2
the per annum rate of eleven and one-half percent (11.5%). If all or portion of
the amount due hereunder is not paid when due, any such overdue amount shall
bear interest at a rate per annum as provided in the preceding sentence plus
0.50% per annum from the date of such non payment until such overdue principal,
interest or other amount is paid in full. Similarly, if on any 5 Business Days
(as defined in the Credit Agreement) (whether or not consecutive) occurring in
any calendar month the amount of the Revolving Credit Loans (as defined in the
Credit Agreement) exceeds the Revolving Credit Commitment (as defined in the
Credit Agreement) as in effect for each such Business Day, then the average
daily balance of all Revolving Credit Loans (as defined in the Credit Agreement)
outstanding on each day during such month shall bear interest at the rate as
provided in the first sentence of this paragraph plus 0.50% per annum. Interest
shall be payable monthly in arrears not later than the last day of each calendar
month beginning April 30, 1998, and shall be calculated on the basis of a year
of three hundred sixty (360) days for the actual number of days elapsed.
If payment hereunder becomes due and payable on a day which is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day, and interest shall be payable thereon during such extension at the
rate specified above. In no contingency or event whatsoever shall interest
charged hereunder, however such interest may be characterized or computed,
exceed the highest rate permissible under any law which a court of competent
jurisdiction shall, in a final determination, deem applicable hereto. In the
event that such a court determines that Lamar has received interest hereunder in
excess of the highest rate applicable hereto, Lamar shall promptly refund such
excess interest to Borrower.
At any time after the any issuance of this Revolving Convertible
Promissory Note, at the option of Lamar, or any holder hereof, of all or part of
the unpaid principal balance and prior to any repayment hereunder, may be
converted into fully paid and non-assessable shares of restricted common stock
(the "Conversion Shares") of Dominion Bridge Corporation, a Delaware corporation
(the "Parent"), at the conversion rate of one (1) Conversion Share for each
$2.60 of outstanding principal indebtedness due hereunder converted. The resale
of the Conversion Shares issuable upon conversion of this Revolving Convertible
Promissory Note is subject to the provisions of a registration rights agreement
to be entered into between the parties hereto.
To exercise its right of conversion, Lamar shall surrender this
Revolving Convertible Promissory Note to the Borrower at its registered office,
accompanied by a written notice in the form annexed hereto as Exhibit A,
properly completed (the "Conversion Notice"). Within five (5) business days
following its receipt of this Revolving Convertible Promissory Note and
Conversion Notice, the Borrower shall issue and deliver (i) a certificate or
certificates for the number of full Conversion Shares issuable, registered in
Lamar's name, and (ii) if less than the entire remaining outstanding principal
balance of this Revolving Convertible Promissory Note is being converted, a
replacement note in the remaining outstanding principal amount of this Revolving
Convertible Promissory Note. Such conversion shall be deemed to have been
effected and the number of Conversion Shares issuable in connection with such
conversion shall be determined as of the close of business on the date on which
this Revolving Convertible Promissory Note and Conversion Notice shall have been
received by the Borrower.
-2-
<PAGE> 3
The conversion price and number of shares to be issued upon conversion
hereunder shall be subject to adjustment from time to time upon the occurrence
of certain events while the conversion rights remain outstanding, as follows:
(i) Subdivisions, Combinations and Other Issuances. If
the Borrower shall at any time after the date hereof but prior to the
Termination Date subdivide its outstanding securities as to which
conversion rights under this Revolving Convertible Promissory Note exist,
by split-up, spin-off, or otherwise, or combine its outstanding securities
as to which conversion rights under this Revolving Convertible Promissory
Note exist, the number of shares of Common Stock as to which this
Revolving Convertible Promissory Note is convertible as of the date of
such subdivision, split-up, spin-off or combination shall forthwith be
proportionately increased in the case of a subdivision, or proportionately
decreased in the case of a combination.
(ii) Stock Dividend. If at any time after the date
hereof the Borrower declares a dividend or other distribution on Common
Stock payable in Common Stock or other securities or rights convertible
into or exchangeable for Common Stock ("Common Stock Equivalents"),
without payment of any consideration by holders of Common Stock for the
additional shares of Common Stock or the Common Stock Equivalents
(including the additional shares of Common Stock issuable upon exercise or
conversion thereof), then the number of shares of Common Stock for which
this Revolving Convertible Promissory Note may be converted shall be
increased as of the record date (or the date of such dividend distribution
if no record date is set) for determining which holders of Common Stock
shall be entitled to receive such dividends, in proportion to the increase
in the number of outstanding shares (and shares of Common Stock issuable
upon conversion of all such securities convertible into Common Stock) of
Common Stock as a result of such dividend.
(iii) Reclassification, Etc. If at any time after the
date hereof there shall be a reclassification of any securities as to
which conversion rights under this Revolving Convertible Promissory Note
exist, into the same or a different number of securities of any other
class or classes, then the Lamar shall thereafter be entitled to receive
upon conversion of this Revolving Convertible Promissory Note, the number
of shares or other securities or property resulting from such
reorganization or reclassification, which would have been received by the
Lamar for the shares of stock subject to this Revolving Convertible
Promissory Note had this Revolving Convertible Promissory Note at such
time been converted.
(iv) Adjustments: Additional Shares, Securities or
Assets. In the event that at any time, as a result of an adjustment made
pursuant hereto, Lamar shall, upon conversion of this Revolving
Convertible Promissory Note, become entitled to receive shares and/or
other securities or assets (other than Common Stock) then, wherever
appropriate, all references herein to shares of Common Stock shall be
deemed to refer to and include such shares and/or other securities or
assets; and thereafter the number of such shares and/or other securities
or assets shall be subject to adjustment from time to time in a manner and
upon terms as nearly equivalent as practicable to the provisions of this
Revolving Convertible Promissory Note.
-3-
<PAGE> 4
Prior to exercising its right of conversion hereunder, Lamar shall take
all actions necessary in the reasonable judgment of the Borrower to comply with
any applicable Australian securities laws in connection with such conversion.
Upon the occurrence of an Event of Default under Section 8(f) of the
Credit Agreement, all of the indebtedness evidenced hereby shall immediately and
automatically, provided that any requirement for giving notice, the lapse of
time, or both has been satisfied, be immediately due and payable; and upon the
occurrence of any other Event of Default under the Credit Agreement, any or all
of the indebtedness evidenced hereby may, at the option of Lamar, and without
demand or notice of any kind, be declared, and thereupon shall become,
immediately due and payable.
Payments received by the Agent for the benefit of Lamar from Borrower
on this Revolving Convertible Promissory Note shall be applied as provided in
the Credit Agreement.
Presentment, protest, notice of nonpayment and protest, notice of
intention to accelerate maturity, notice of acceleration of maturity and notice
of dishonor are hereby waived by the Borrower.
This Revolving Convertible Promissory Note shall be construed in all
respects in accordance with, and governed by, the laws and decisions of the
Province of Quebec and the laws of Canada applicable therein. BORROWER HEREBY
CONSENTS TO THE JURISDICTION OF ANY COURT LOCATED WITHIN QUEBEC, CANADA AND
WAIVES ANY OBJECTION WHICH BORROWER MAY HAVE BASED ON IMPROPER VENUE OR FORUM
NON CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT AND CONSENTS
THAT ALL SERVICE OF PROCESS UPON IT BE MADE BY REGISTERED MAIL OR MESSENGER
DIRECTED TO IT AT THE ADDRESS SET FORTH IN SUBSECTION 10.2 OF THE CREDIT
AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON THE
EARLIER OF ACTUAL RECEIPT OR THREE (3) DAYS AFTER THE SAME SHALL HAVE BEEN
POSTED TO BORROWER'S ADDRESS BY BORROWER'S AGENT AS SET FORTH BELOW. AT THE
OPTION OF LAMAR, BORROWER WAIVES, TO THE EXTENT PERMITTED BY LAW, TRIAL BY JURY,
AND WAIVES ANY BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR
THIS WAIVER, BE REQUIRED OF LAMAR. NOTHING CONTAINED IN THIS PARAGRAPH SHALL
AFFECT THE RIGHT OF LAMAR TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED
BY LAW OR AFFECT THE RIGHT OF LAMAR TO BRING ANY ACTION OR PROCEEDING AGAINST
BORROWER OR ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION.
Whenever possible each provision of this Revolving Convertible
Promissory Note shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Revolving Convertible
Promissory Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the remaining provisions
of this
-4-
<PAGE> 5
Revolving Convertible Promissory Note. Whenever in this Revolving
Convertible Promissory Note reference is made to Lamar or Borrower, such
reference shall be deemed to include, as applicable, a reference to their
respective successors and assigns. The provisions of this Revolving Convertible
Promissory Note shall be binding upon Borrower and its successors and assigns,
and shall inure to the benefit of Lamar and its successors and assigns.
The Borrower agrees to promptly pay all costs and expenses (including
attorneys' fees, expenses and disbursements, and costs of settlement and the
fees, expenses and disbursements of experts or advisors) incurred by Lamar in
enforcing any obligations of or in collecting any payments due from the Borrower
under this Revolving Convertible Promissory Note.
GROUPE CEDAR CANADA INC./
CEDAR GROUP CANADA INC.
By
----------------------------
Its
----------------------------
-5-
<PAGE> 6
Exhibit A
[FORM OF CONVERSION NOTICE]
TO: Dominion Bridge Corporation
Groupe Cedar Canada, Inc./Cedar Group Canada Inc.
The undersigned owner of this Revolving Convertible Promissory Note
hereby: (i) irrevocably exercises the option to convert this Revolving
Convertible Promissory Note, [or the portion hereof below designated,] for
restricted Common Stock of Dominion Bridge Corporation (the "Conversion Shares")
in accordance with the terms hereof and (ii) directs that such Conversion Shares
deliverable upon the conversion, together with any check in payment for
fractional shares and interest [and any Revolving Convertible Promissory Note or
Revolving Convertible Promissory Notes representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof ]unless a
different name has been indicated below. If Conversion Shares are to be
delivered or registered in the name of a person other than the undersigned, the
undersigned will pay all taxes with respect thereto, and Dominion Bridge
Corporation will not be required to issue or deliver a certificate for such
Conversion Shares until the undersigned has paid to Dominion Bridge Corporation
the amount of such tax or has established to the satisfaction of Dominion Bridge
Corporation the that such tax has been paid.
Dated:
-------------- -----------------------------------
Signature
Fill in for registration of shares if to be delivered[, and of Revolving
Convertible Promissory Notes if to be issued,] otherwise than to and in the name
of the registered holder.
-----------------------------------
Social Security or Other
Taxpayer Identifying Number
- -----------------------------------
(Name)
- -----------------------------------
(Street Address)
- -----------------------------------
(City, State and Zip Code)
(Please print name and address)
Principal Amount to be Converted[(if less than all)]:
$
-------------------------------------------------------
<PAGE> 1
EXHIBIT 4.4
FORM
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. THE SECURITIES REPRESENTED HEREBY HAVE BEEN TAKEN BY
THE REGISTERED OWNER FOR INVESTMENT, AND WITHOUT A VIEW TO RESALE OR
DISTRIBUTION THEREOF, AND MAY NOT BE TRANSFERRED OR DISPOSED OF WITHOUT AN
OPINION OF COUNSEL SATISFACTORY TO DOMINION BRIDGE CORPORATION THAT SUCH
TRANSFER OR DISPOSITION DOES NOT VIOLATE THE SECURITIES ACT OF 1933, AS AMENDED,
OR THE RULES AND REGULATIONS THEREUNDER.
CONVERTIBLE PROMISSORY NOTE
$4,800,000.00 Chicago, Illinois
April __, 1998
FOR VALUE RECEIVED, the undersigned, Groupe Cedar Canada, Inc./Cedar
Group Canada Inc., a Canadian corporation ("Borrower"), hereby unconditionally
promises to pay to the order of Pouliot Mercure, as Agent (the "Agent") for the
benefit of Wellgate International Ltd, a British Virgin Island corporation
("Wellgate"), at the Agent's office at 1155 Rene-Levesque Boulevard West, Suite
3100, Montreal, Quebec, Canada H3B 3S6, or at such other place as the Agent may
from time to time designate in writing, in lawful money of the United States of
America and in immediately available funds, the unpaid principal sum of the term
loan made by Wellgate to the Borrower pursuant to subsection 2.2 of the "Credit
Agreement" (as hereinafter defined) of Four Million Eight Hundred Thousand and
No/100 Dollars ($4,800,000.00). This Convertible Promissory Note is referred to
in, and was executed and delivered pursuant to, that certain Credit Agreement,
of even date herewith, among Wellgate, Lamar (as defined therein) and Borrower
(the "Credit Agreement") to which reference is hereby made for a statement of
the terms and conditions under which the loan evidenced hereby was made and is
to be repaid.
The indebtedness evidenced hereby shall be for a term ending on the
Termination Date (as defined in the Credit Agreement). In addition to the
foregoing payments, Borrower shall pay to Wellgate the mandatory repayments
referred to in, and in accordance with, subsection 3.2 of the Credit Agreement.
Borrower further promises to pay interest on the outstanding unpaid
principal amount hereof, as provided in the Credit Agreement, from the date
hereof until payment in full hereof, at the per annum rate of eleven and
one-half percent (11.5%). If all or portion of the amount due
<PAGE> 2
hereunder is not paid when due, any such overdue amount shall bear interest at a
rate per annum as provided in the preceding sentence plus 0.50% per annum from
the date of such non payment until such overdue principal, interest or other
amount is paid in full. Interest shall be payable monthly in arrears not later
than the last day of each calendar month beginning April 30, 1998, and shall be
calculated on the basis of a year of three hundred sixty (360) days for the
actual number of days elapsed.
If payment hereunder becomes due and payable on a day which is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day, and interest shall be payable thereon during such extension at the
rate specified above. In no contingency or event whatsoever shall interest
charged hereunder, however such interest may be characterized or computed,
exceed the highest rate permissible under any law which a court of competent
jurisdiction shall, in a final determination, deem applicable hereto. In the
event that such a court determines that Wellgate has received interest hereunder
in excess of the highest rate applicable hereto, Wellgate shall promptly refund
such excess interest to Borrower.
At any time after the any issuance of this Convertible Promissory Note,
at the option of Wellgate, or any holder hereof, of all or part of the unpaid
principal balance and prior to any repayment hereunder, may be converted into
fully paid and non-assessable shares of restricted common stock (the "Conversion
Shares") of Dominion Bridge Corporation, a Delaware corporation (the "Parent"),
at the conversion rate of one (1) Conversion Share for each $2.60 of outstanding
principal indebtedness due hereunder converted. The resale of the Conversion
Shares issuable upon conversion of this Convertible Promissory Note is subject
to the provisions of a registration rights agreement to be entered into between
the parties hereto.
To exercise its right of conversion, Wellgate shall surrender this
Convertible Promissory Note to the Borrower at its registered office,
accompanied by a written notice in the form annexed hereto as Exhibit A,
properly completed (the "Conversion Notice"). Within five (5) business days
following its receipt of this Convertible Promissory Note and Conversion Notice,
the Borrower shall issue and deliver (i) a certificate or certificates for the
number of full Conversion Shares issuable, registered in Wellgate's name, and
(ii) if less than the entire remaining outstanding principal balance of this
Convertible Promissory Note is being converted, a replacement note in the
remaining outstanding principal amount of this Convertible Promissory Note. Such
conversion shall be deemed to have been effected and the number of Conversion
Shares issuable in connection with such conversion shall be determined as of the
close of business on the date on which this Convertible Promissory Note and
Conversion Notice shall have been received by the Borrower.
The conversion price and number of shares to be issued upon conversion
hereunder shall be subject to adjustment from time to time upon the occurrence
of certain events while the conversion rights remain outstanding, as follows:
(i) Subdivisions, Combinations and Other Issuances.
If the Borrower shall at any time after the date hereof but prior to
the Termination Date subdivide its outstanding securities as to which
conversion rights under this Convertible Promissory Note
-2-
<PAGE> 3
exist, by split-up, spin-off, or otherwise, or combine its outstanding
securities as to which conversion rights under this Convertible
Promissory Note exist, the number of shares of Common Stock as to which
this Convertible Promissory Note is convertible as of the date of such
subdivision, split-up, spin-off or combination shall forthwith be
proportionately increased in the case of a subdivision, or
proportionately decreased in the case of a combination.
(ii) Stock Dividend. If at any time after the date
hereof the Borrower declares a dividend or other distribution on Common
Stock payable in Common Stock or other securities or rights convertible
into or exchangeable for Common Stock ("Common Stock Equivalents"),
without payment of any consideration by holders of Common Stock for the
additional shares of Common Stock or the Common Stock Equivalents
(including the additional shares of Common Stock issuable upon exercise
or conversion thereof), then the number of shares of Common Stock for
which this Convertible Promissory Note may be converted shall be
increased as of the record date (or the date of such dividend
distribution if no record date is set) for determining which holders of
Common Stock shall be entitled to receive such dividends, in proportion
to the increase in the number of outstanding shares (and shares of
Common Stock issuable upon conversion of all such securities
convertible into Common Stock) of Common Stock as a result of such
dividend.
(iii) Reclassification, Etc. If at any time after the
date hereof there shall be a reclassification of any securities as to
which conversion rights under this Convertible Promissory Note exist,
into the same or a different number of securities of any other class or
classes, then the Wellgate shall thereafter be entitled to receive upon
conversion of this Convertible Promissory Note, the number of shares or
other securities or property resulting from such reorganization or
reclassification, which would have been received by the Wellgate for
the shares of stock subject to this Convertible Promissory Note had
this Convertible Promissory Note at such time been converted.
(iv) Adjustments: Additional Shares, Securities or
Assets. In the event that at any time, as a result of an adjustment
made pursuant hereto, the Wellgate shall, upon conversion of this
Convertible Promissory Note, become entitled to receive shares and/or
other securities or assets (other than Common Stock) then, wherever
appropriate, all references herein to shares of Common Stock shall be
deemed to refer to and include such shares and/or other securities or
assets; and thereafter the number of such shares and/or other
securities or assets shall be subject to adjustment from time to time
in a manner and upon terms as nearly equivalent as practicable to the
provisions of this Convertible Promissory Note.
Prior to exercising its right of conversion hereunder, Wellgate shall
take all actions necessary in the reasonable judgment of the Borrower to comply
with any applicable Australian securities laws in connection with such
conversion.
Upon the occurrence of an Event of Default under Section 8(f) of the
Credit Agreement, all of the indebtedness evidenced hereby shall immediately and
automatically, provided that any
-3-
<PAGE> 4
requirement for giving notice, the lapse of time, or both has been satisfied, be
immediately due and payable; and upon the occurrence of any other Event of
Default under the Credit Agreement, any or all of the indebtedness evidenced
hereby may, at the option of Wellgate, and without demand or notice of any kind,
be declared, and thereupon shall become, immediately due and payable.
Payments received by the Agent for the benefit of Wellgate from
Borrower on this Convertible Promissory Note shall be applied as provided in the
Credit Agreement.
Presentment, protest, notice of nonpayment and protest, notice of
intention to accelerate maturity, notice of acceleration of maturity and notice
of dishonor are hereby waived by the Borrower.
This Convertible Promissory Note shall be construed in all respects in
accordance with, and governed by, the laws and decisions of the Province of
Quebec and the laws of Canada applicable thereto. BORROWER HEREBY CONSENTS TO
THE JURISDICTION OF ANY COURT LOCATED WITHIN QUEBEC, CANADA AND WAIVES ANY
OBJECTION WHICH BORROWER MAY HAVE BASED ON IMPROPER VENUE OR FORUM NON
CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT AND CONSENTS THAT
ALL SERVICE OF PROCESS UPON IT BE MADE BY REGISTERED MAIL OR MESSENGER DIRECTED
TO IT AT THE ADDRESS SET FORTH IN SUBSECTION 10.2 OF THE CREDIT AGREEMENT AND
THAT SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON THE EARLIER OF ACTUAL
RECEIPT OR THREE (3) DAYS AFTER THE SAME SHALL HAVE BEEN POSTED TO BORROWER'S
ADDRESS BY BORROWER'S AGENT AS SET FORTH BELOW. AT THE OPTION OF WELLGATE,
BORROWER WAIVES, TO THE EXTENT PERMITTED BY LAW, TRIAL BY JURY, AND WAIVES ANY
BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE
REQUIRED OF WELLGATE. NOTHING CONTAINED IN THIS PARAGRAPH SHALL AFFECT THE RIGHT
OF WELLGATE TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
AFFECT THE RIGHT OF LAMAR TO BRING ANY ACTION OR PROCEEDING AGAINST BORROWER OR
ITS PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION.
Whenever possible each provision of this Convertible Promissory Note
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Convertible Promissory Note shall
be prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Convertible Promissory Note. Whenever in this Convertible Promissory Note
reference is made to Wellgate or Borrower, such reference shall be deemed to
include, as applicable, a reference to their respective successors and assigns.
The provisions of this Convertible Promissory Note shall be binding upon
Borrower and its successors and assigns, and shall inure to the benefit of
Wellgate and its successors and assigns.
-4-
<PAGE> 5
The Borrower agrees to promptly pay all costs and expenses (including
attorneys' fees, expenses and disbursements, and costs of settlement and the
fees, expenses and disbursements of experts or advisors) incurred by Wellgate in
enforcing any obligations of or in collecting any payments due from the Borrower
under this Convertible Promissory Note.
GROUPE CEDAR CANADA INC./
CEDAR GROUP CANADA INC.
By
-----------------------------------
Its
-----------------------------------
-5-
<PAGE> 6
Exhibit A
[FORM OF CONVERSION NOTICE]
TO: Dominion Bridge Corporation
Groupe Cedar Canada, Inc./Cedar Group Canada Inc.
The undersigned owner of this Convertible Promissory Note hereby: (i)
irrevocably exercises the option to convert this Convertible Promissory Note,
[or the portion hereof below designated,] for restricted Common Stock of
Dominion Bridge Corporation (the "Conversion Shares") in accordance with the
terms hereof and (ii) directs that such Conversion Shares deliverable upon the
conversion, together with any check in payment for fractional shares and
interest [and any Convertible Promissory Note or Convertible Promissory Notes
representing any unconverted principal amount hereof, be issued and delivered to
the registered holder hereof ]unless a different name has been indicated below.
If Conversion Shares are to be delivered or registered in the name of a person
other than the undersigned, the undersigned will pay all taxes with respect
thereto, and Dominion Bridge Corporation will not be required to issue or
deliver a certificate for such Conversion Shares until the undersigned has paid
to Dominion Bridge Corporation the amount of such tax or has established to the
satisfaction of Dominion Bridge Corporation the that such tax has been paid.
Dated:
----------------- ---------------------------------
Signature
Fill in for registration of shares if to be delivered[, and of Convertible
Promissory Notes if to be issued,] otherwise than to and in the name of the
registered holder.
---------------------------------
Social Security or Other
Taxpayer Identifying Number
- ---------------------------------
(Name)
- ---------------------------------
(Street Address)
- ---------------------------------
(City, State and Zip Code)
(Please print name and address)
Principal Amount to be Converted[(if less than all)]:
$
-----------------------------------------------------
<PAGE> 1
EXHIBIT 10.2
SETTLEMENT, RELEASE AND DISCHARGE AGREEMENT
THIS SETTLEMENT RELEASE AND DISCHARGE AGREEMENT (the "Agreement") is
made and entered into as of April 28, 1998, by and among MICHEL L. MARENGERE
("Mr. Marengere"), a resident of Quebec, Canada, SERVICES M.L. MARENGERE, INC.,
a Canadian services corporation, which Mr. Marengere controls ("Services MLM"),
and DOMINION BRIDGE CORPORATION, a Delaware corporation (the "Corporation").
WITNESSETH
WHEREAS, Mr. Marengere is Chairman of the Board of Directors, Chief
Executive Officer and Director of the Corporation and also serves as an officer
and/or a director of a number of subsidiaries of the Corporation, whose services
are provided by Services MLM pursuant to the Services Agreement (as hereinafter
defined); and
WHEREAS, subject to the terms and conditions of this Agreement, Mr.
Marengere and Services MLM and the Corporation have decided to terminate the
Services Agreement dated February 1, 1995 by and between the Corporation and
Services MLM (the "Services Agreement") effective today, and Mr. Marengere has
decided to resign his positions as Chairman of the Board of Directors of the
Corporation, Chief Executive Officer of the Corporation, Director of the
Corporation, and any other positions he holds with the Dominion Bridge Parties
(as defined in Paragraph 2) effective today; and
WHEREAS, Marengere and Services MLM claim indemnification from the
Corporation for extra-contractual damages for the libel and defamation of
Services MLM and for attacks to
<PAGE> 2
Mr. Marengere's honor and reputation, stress, loss of enjoyment of life and
moral damages incurred by them, following the public attacks he was the object
of on the part of among others, Mr. Kandola, Mr. Knai, the plaintiffs in the
Miller and Smith cases, Royal Millenia Group, Ltd., and the "Committee to
Revitalize Dominion Bridge Corporation," all of which were reported in the
electronic and print media in Quebec and in Canada, as well as various personal
attacks and moral and physical threats on the worldwide internet which were
reported to the Royal Canadian Mounted Police and the Montreal Urban Community
Police and investigated by Constable Michel Auclair (Badge No. 4834) and file
number 8980403006;
WHEREAS, in settlement of any such extra contractual damages the
Corporation recognizes that Mr. Marengere and Services MLM may have suffered,
the Corporation desires to indemnify them accordingly; and
WHEREAS, in connection with Mr. Marengere's resignation and the
termination of the services of Services MLM, Services MLM and the Corporation
desire to cancel all agreements between or among them and supersede those
agreements with this Agreement and those agreements identified in that certain
Closing Memorandum (the "Closing Memorandum") dated as of April 21, 1998, a copy
of which is attached hereto as Exhibit A;
NOW, THEREFORE, in consideration for the premises, the mutual promises
herein contained, and intending to be legally bound hereby, it is agreed as
follows:
1. The recitals set forth above are incorporated herein as part
of this Agreement.
2. "Dominion Bridge Parties" as used herein, shall at all times
mean Dominion Bridge Corporation, its subsidiaries, successors and assigns, its
affiliated and predecessor companies or corporations, their successors and
assigns, their affiliated and predecessor
-2-
<PAGE> 3
companies or corporations and the present or former directors, officers,
shareholders, employees, attorneys and agents of any of them, whether in their
individual or official capacities, and the current and former trustees or
administrators of any pension or other benefit plan applicable to the employees
or former employees of Dominion Bridge in their official and individual
capacities.
3. The Corporation agrees to pay Services MLM or its assignees
for the said termination and the extra contractual damages, the sum of Two
Million Seven Hundred Thousand Dollars ($2,700,000). These payments will be made
by delivery at the time of execution of this Agreement to Pouliot Mercure as
trustee for Wellgate International, Ltd. ("Wellgate") of the Corporation's 11.5%
Convertible Note (the "Note") in the principal amount of Four Million Eight
Hundred Thousand Dollars ($4,800,000), in which Services MLM will have a
beneficial interest equal to $2,700,000. The Note is convertible into shares of
Common Stock, $.001 par value per share, of the Corporation at the conversion
rate of $2.60 per share. A copy of the Note is attached hereto as Exhibit B.
4. As an inducement to Services MLM to accept the Note pursuant
to Paragraph 3 hereof, Dominion Bridge will issue a Common Stock Purchase
Warrant (the "Warrant") to Wellgate to purchase 333,708 shares of Common Stock,
$.001 par value per share, of the Corporation at $3.00 per share for a three (3)
year period commencing on the date hereof in which Services MLM will have a
beneficial interest to purchase 187,711 shares. A copy of the Warrant is
attached hereto as Exhibit C. The Corporation has also agreed to register the
resale of the shares of Common Stock issuable upon exercise of the Warrant and
conversion of the Note,
-3-
<PAGE> 4
as applicable, with the United States Securities and Exchange Commission (the
"SEC") pursuant to the terms of a Registration Rights Agreement, a copy of which
is attached hereto as Exhibit D.
5. Services MLM represents and agrees that subject to the terms
and conditions contained herein and in those agreements identified in the
Closing Memorandum, it hereby terminates the Services Agreement with the
Corporation, effective today, April 21, 1998. In addition, Mr. Marengere
represents and agrees that subject to the terms and conditions contained herein
and in those agreements identified in the Closing Memorandum, he hereby resigns
from his positions as a Chairman of the Board of Directors, Chief Executive
Officer and a Director of the Corporation and from any and all officer or
director positions he holds with any of the Dominion Bridge Parties.
6. Services MLM and Mr. Marengere further represent and agree
that they will not apply for, otherwise seek or accept employment with any
Dominion Bridge Party at any time in the future. Any breach of this Paragraph 6
by Services MLM or Mr. Marengere will constitute lawful and just cause to refuse
to accept such services and they will have no cause of action against any
Dominion Bridge Party for such refusal.
7. Except as permitted or directed by the Corporation's Board of
Directors or as required by law, Services MLM and Mr. Marengere shall not
utilize, divulge, furnish or make accessible to anyone any confidential or
secret knowledge or information of the Dominion Bridge Parties, including any
trade secrets, confidential or secret processes, plans, or materials, useful in
any aspect of the business of the Dominion Bridge Parties, any confidential
customer or supplier lists or business plan of the Dominion Bridge Parties, or
any other confidential information or trade secrets of the business of the
Dominion Bridge Parties. Services MLM and
-4-
<PAGE> 5
Mr. Marengere acknowledge that the above-described knowledge or information
constitutes a unique and valuable asset of the Dominion Bridge Parties, acquired
at great time and expense by the Dominion Bridge Parties, and that any
disclosure or other use of such knowledge or information other than for the sole
benefit of the Dominion Bridge Parties, would be wrongful and would cause
irreparable harm to the Dominion Bridge Parties.
8. As a material inducement to the Corporation to enter into this
Agreement and for and in consideration of the terms expressed herein, to the
fullest extent permitted by Delaware law, Services MLM and Mr. Marengere, for
themselves, their respective successors and assigns, do hereby irrevocably and
unconditionally release and forever discharge the Dominion Bridge Parties of and
from any and all claims, charges, demands, liabilities, obligations, promises,
controversies, damages, rights, actions and causes of action of whatever nature,
kind or character, in law or equity, whether known or unknown ("Claims"), which
Services MLM and Mr. Marengere now has, may have or claims to have or which
Services MLM or Mr. Marengere at any time heretofore may have, had or claimed to
have against any Dominion Bridge Party. This release includes, but is not
limited to, those Claims arising from, during or related in any way to Services
MLM providing services to Dominion Bridge, the termination of the Services
Agreement, Mr. Marengere's positions as a director or officer of any Dominion
Bridge Party, the termination of Mr. Marengere's relationship with the Dominion
Bridge Parties and Mr. Marengere's direct or indirect ownership of stock in
Dominion Bridge. Services MLM and Mr. Marengere agree not to assert any such
Claims or causes of action released by Services MLM and Mr. Marengere in this
Paragraph. This release includes, but is not limited to, Claims arising under
federal, state, Canadian provincial, or local statutes, ordinances or common
laws,
-5-
<PAGE> 6
specifically including, but not limited to, the United States Securities
Act of 1933, as amended, the United States Securities Exchange Act of 1934, as
amended, the Civil Rights Act of 1866, the Civil Rights Act of 1871, Title VII
of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Age
Discrimination in Employment Act of 1967, the Rehabilitation Act of 1973, the
Older Workers Benefit Protection Act, the Americans With Disabilities Act, the
Employee Retirement Income Security Act of 1974, Executive Order 112346, the
Veterans Reemployment Statutes, the Family and Medical Leave Act, all as
amended, and Claims pertaining to buying or selling securities, unlawful
discrimination, any common law Claims for breach of contract, wrongful
discharge, or otherwise, and/or Claims for attorneys' fees, and any similar
Claims under Canadian provincial law. Services MLM and Mr. Marengere agree not
to file any lawsuit or a demand for arbitration against any Dominion Bridge
Party asserting a cause of action for any of the Claims released herein.
Services MLM and Mr. Marengere agree to pay for any damages (including legal
fees or costs) incurred by any Dominion Bridge Party as a result of any breach
of the promises in this Paragraph 8. Notwithstanding the forgoing, this
Paragraph 8 shall not release any Dominion Bridge Party for any claims for which
the Corporation has an indemnification obligation under this Agreement.
Notwithstanding the foregoing release, in the event of any material breach by
the Dominion Bridge Parties of this Agreement or any agreement identified in the
Closing Memorandum, the release set forth in this Paragraph 8 shall be null and
void and of no further force or effect. Notwithstanding the foregoing, nothing
contained herein shall prohibit Services MLM or Mr. Marengere from asserting any
claim against any of the Dominion Bridge Parties arising out of or in any way
related to the Note, Credit Agreement, Consulting Agreement or any other
agreement identified in the Closing Memorandum.
-6-
<PAGE> 7
9. In the event Services MLM or Mr. Marengere files a lawsuit
against any Dominion Bridge Party asserting a cause of action for any of the
Claims released herein pursuant to the terms and conditions Paragraph 8 above,
Services MLM and Mr. Marengere agree to repay to the Corporation any sums
received by Services MLM from the Corporation pursuant to Paragraph 3 of this
Agreement. Further, Services MLM and Mr. Marengere agree to forfeit any
entitlement they have to receive any payments not yet received by then from the
Corporation pursuant to Paragraph 3. Any material breach of this Agreement by
any Dominion Bridge Party shall be considered an event of default under the
Note, Credit Agreement, Consulting Agreement and all other agreements identified
in the Closing Memorandum and Services MLM and Mr. Marengere may file a demand
for arbitration against the Dominion Bridge Parties pursuant to Paragraph 23.
Services MLM and Mr. Marengere will not be responsible for legal fees incurred
by the Corporation in any arbitration in which the Corporation is found to have
materially breached its obligations under this Agreement.
10. As a material inducement to Services MLM and Mr. Marengere to
enter into this Agreement and for and in consideration of the terms expressed
herein, the Dominion Bridge Parties themselves, their successors and assigns, do
hereby irrevocably and unconditionally release and forever discharge Services
MLM and Mr. Marengere of and from any and all Claims for which the fullest
extent of applicable Delaware law would permit the Corporation to indemnify
Services MLM or Mr. Marengere which the Dominion Bridge Parties now have, may
have or claims to have or (subject to the monetary limitation with respect to
the Fiduciary Deductions, as defined in Paragraph 12) which any Dominion Bridge
Party at any time heretofore may have, had or claimed to have against Services
MLM or Mr. Marengere. This
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<PAGE> 8
release includes, subject to all of the provisions of this Paragraph 10, any and
all obligations of Services MLM or Mr. Marengere with respect to the Fiduciary
Deductions (to the extent disclosed in paragraph 12); any and all obligations of
Fidutech International, Inc., a company controlled by Mr. Marengere, under that
certain guarantee provided in connection with the Corporation's sale of Edinov;
any and all obligations of Fidutech Technologies, Inc., a company controlled by
Mr. Marengere, under that certain subscription receivable in the principal
amount of $1.824 million; and any and all claims under the Services Agreement.
In addition, to the fullest extent permitted under Delaware law, the Corporation
shall indemnify Services MLM and Mr. Marengere from any and all loss, liability
and damages (including legal fees or costs) which Services MLM or Mr. Marengere
may be subject to in any claims by any third party relating to any actions taken
by Mr. Marengere in his capacity as an Officer or Director of any Dominion
Bridge Party or any services provided by Services MLM to any Dominion Bridge
Party. The Dominion Bridge Parties agree not to assert any such Claims or causes
of action released in this Paragraph 10. The Corporation agrees to pay for any
damages (including legal fees or costs) incurred by Services MLM or Mr.
Marengere as a result of any material breach of the promises of the Dominion
Bridge Parties in this Paragraph 10 and in the event of such breach, all sums
due and owing under the Note, Credit Agreement, Consulting Agreement and any
other agreement identified in the Closing Memorandum shall become immediately
due and payable. The Corporation will not be responsible for legal fees incurred
by Services MLM or Mr. Marengere in any arbitration in which Services MLM or Mr.
Marengere is found to have materially breached their obligations under this
Agreement. Notwithstanding the foregoing release, in the event of any material
breach by Services MLM or Mr. Marengere of this Agreement or any
-8-
<PAGE> 9
agreement identified in the Closing Memorandum, the release set forth in this
Paragraph 10 shall be null and void and of no further force or effect.
Notwithstanding the foregoing, nothing contained herein shall prohibit any of
the Dominion Bridge Parties from asserting any claim against Services MLM or Mr.
Marengere arising out of or in any way related to the Note, Credit Agreement,
Consulting Agreement or any other agreement identified in the Closing
Memorandum.
11. As a material inducement to the Corporation to enter into this
Agreement, Services MLM and Mr. Marengere represent to the Corporation that to
the best of their actual knowledge after due inquiry, the total amount of
outstanding fiduciary deductions in arrears which are due and owing by the
Dominion Bridge Parties to fiduciary creditors, including the Canadian
Government, as of March 31, 1998 is Cdn $15.012 million as set forth in Schedule
A attached hereto (the "Fiduciary Deductions").
12. The Corporation's entire obligation to provide fees, incentive
compensation, bonus, stock, stock awards, stock options, pension, medical
insurance, dental insurance, group-life insurance, split-dollar insurance,
vacation, compensation, benefits, consideration of any kind, or anything else of
value to Services MLM or Mr. Marengere is set forth in this Agreement and in
those agreements identified in the Closing Memorandum, a copy of which is
attached hereto as Exhibit A. Any other obligation of any Dominion Bridge Party
to provide any of the foregoing to Services MLM or Mr. Marengere is hereby
canceled.
13. In order to insure fairness regarding the use of information
about the Dominion Bridge Parties, Services MLM and Mr. Marengere agree that for
a period of two (2) years from the date hereof, without the prior written
consent of the Board of Directors of the Corporation,
-9-
<PAGE> 10
that they will not join with or become part of (whether by ownership of an
equity interest in, other than any ownership of less than 5 percent of any class
of securities of any company which is a reporting company under the Securities
Exchange Act of 1934) or serve as a partner, director, officer, employee or
agent of any corporation, group, partnership or other entity (each of the
foregoing is hereafter referred to as an "Acquirer") which seeks to acquire all
or substantially all of the business and/or assets of any Dominion Bridge Party
including, without limitation of the foregoing, any such acquisition sought to
be effectuated by purchase of all or any substantial portion of the
Corporation's voting stock or securities convertible into all or any substantial
portion of the Corporation's voting stock (whether through open-market
purchases(s), privately negotiated purchase(s) or tender offer(s)), by merger
into or with any Party or by purchase of all or substantially all of the assets
of the Corporation or the purchase of all of or a majority of the outstanding
stock of any Dominion Bridge Party. In addition, Services MLM and Mr. Marengere
agree not to furnish any information concerning or with respect to any Dominion
Bridge Party to any person or entity that Services MLM or Mr. Marengere knows or
believes is interested in acquiring any Dominion Bridge Party.
14. Each of the parties to this Agreement promises and agrees
that he or it shall make no negative or derogatory comments, oral or written,
directly or by innuendo, about any of the other parties to this Agreement on
any subject, including, but not limited to, comments about another party's
business actions, management, employees, policies, procedures or
management-employee relations. The parties hereby agree that the press release
describing the subject matter of this Agreement attached hereto as Exhibit D
shall be disseminated after this Agreement and all
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<PAGE> 11
the agreements identified in the Closing Memorandum have been executed by the
parties hereto or thereto, as applicable.
15. Other than as set forth herein or in any agreement identified
in the Closing Memorandum, a copy of which is attached hereto as Exhibit A, each
of the parties to this Agreement represents that he or it has not heretofore
assigned or transferred, or purported to assign or transfer, to any person or
entity, any claim or any portion thereof or interest therein.
16. Each of the parties to this Agreement represents and warrants
that he or it knows of no claims that he or it has against any of the other
parties to this Agreement and further represents and warrants that he or it
knows of no claims that any other person or entity controlled by such party or
affiliated with such party has against any of the other parties to this
Agreement. Mr. Marengere further represents and warrants that he is not now nor
has he ever been an employee of any Dominion Bridge Party and that he has no
rights nor has he ever had any rights as an employee of any Dominion Bridge
Party.
17. Except for the representations and warranties made by the
parties in this Agreement or in any agreement identified in the Closing
Memorandum, each of the parties to this Agreement represents and acknowledges
that in executing this Agreement he or it does not rely, and has not relied,
upon any representation or statement made by any of the other parties to this
Agreement by any other party's agents, representatives or attorneys with regard
to the subject matter, basis or effect of this Agreement.
18. The parties to this Agreement have decided it is in their
mutual self-interest to enter into this Agreement. It shall not be construed as
an admission by any party of any act of
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<PAGE> 12
wrong doing and each party disclaims any liability to any and all of the other
parties except as is set forth in this Agreement.
19. Any notice from Services MLM or Mr. Marengere to the
Corporation required under this Agreement shall be sent to Dominion Bridge's
Chief Executive Officer, 500 rue Notre Dame, Lachine, Quebec, Canada, H8S 2B2,
or to such other person or place as the Corporation designates in writing. Any
notice from the Corporation to Services MLM or Mr. Marengere required under this
Agreement shall be sent to Services MLM attention: J. Brian Riordan c/o Pouliot
Mercure at CIBC Tower, 31st Floor, 1155 rene-Levesque Blvd. West, Montreal,
Quebec, Canada H3B 3S6, or to such other person or place as Services MLM or Mr.
Marengere designates in writing.
20. This Agreement shall be binding upon Services MLM and Mr.
Marengere and upon their respective heirs, administrators, representatives,
executors, successors and assigns, and shall inure to the benefit of the
Dominion Bridge Parties. This Agreement shall be binding on the Dominion Bridge
Parties and its successors and assigns and shall inure to the benefit of
Services MLM, their respective heirs, administrators, representatives,
executors, successors and assigns.
21. This Agreement is made and entered into in the Province of
Quebec, Canada, and shall in all respects be interpreted, enforced and governed
under the laws of said province; provided, however, that to the extent
specifically provided herein, certain provisions of this Agreement shall be
interpreted in accordance with Delaware law. The language of all parts of this
Agreement shall in all cases be construed as a whole, according to its fair
meaning, and not strictly for or against any of the parties.
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<PAGE> 13
22. Should any provision of this Agreement be declared or be
determined to be illegal or invalid, the validity of the remaining parts, terms
or provisions shall not be affected thereby and said illegal or invalid part,
term, or provision shall be deemed not to be a part of this Agreement.
23. In the event of any dispute between the parties, including any
claims, counterclaims, crossclaims or third party claims, whether referring or
relating to any term of this Agreement or any other matter which the parties are
unable to resolve between themselves, at the written request of any party the
matter shall be submitted to arbitration pursuant to the rules of the Canadian
Arbitration Association. Within ten (10) days after receipt of a request for
arbitration, Services MLM and the Corporation shall each choose an arbitrator
and within ten (10) days thereafter the Canadian Arbitration Association shall
be requested to supply a third arbitrator and this request may be made by any
party. In the event Services MLM or the Corporation does not choose an
arbitrator within ten (10) days, as set forth above, the Canadian Arbitration
Association shall also supply that arbitrator in addition to the third
arbitrator. The arbitration shall be held in Montreal, Quebec, Canada, and shall
commence and be completed as soon as possible under the rules and regulations of
the Canadian Arbitration Association then in effect. In the event of any dispute
of any procedural, evidentiary, or substantive matter, including the
arbitrability of the dispute presented, the decision of the majority of the
arbitrators shall be final and conclusive upon the parties on the matter of
dispute.
24. As used in this Agreement, the singular or plural number
shall be deemed to include the other whenever the context so indicates or
requires.
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<PAGE> 14
25. This Agreement is part of a larger transaction involving
numerous additional agreements all of which are identified in the Closing
Memorandum, a copy of which is attached hereto as Exhibit A. Unless and until
this Agreement and all of the agreements identified in the Closing Memorandum
are executed by the parties hereto or thereto, as applicable, this Agreement
shall not be binding upon the parties hereto.
26. This Agreement, and any agreement identified in the Closing
Memorandum, a copy of which is attached hereto as Exhibit A, sets forth the
entire agreement between the parties hereto and fully supersedes any and all
prior agreements or understandings between or among the parties hereto. This
Agreement may not be modified unless the parties agree in writing.
27. All dollar figures included in this Agreement represent U.S.
Dollars.
28. The parties acknowledge that they have required that this
Agreement and all related documents be prepared in English. Les parties
reconnaissent avoir exige que la presente convention et tous les documents
connexes soient rediges en anglais.
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<PAGE> 15
MR. MARENGERE, SERVICES M.L. MARENGERE, INC. AND THE CORPORATION ACKNOWLEDGE
THAT THEY HAVE CAREFULLY READ AND FULLY UNDERSTAND THE PROVISIONS OF THIS
AGREEMENT INCLUDING THE RELEASE OF CLAIMS AND HAS HAD SUFFICIENT TIME AND
OPPORTUNITY TO CONSULT WITH HIS OR ITS PERSONAL FINANCIAL, TAX, AND LEGAL
ADVISORS PRIOR TO EXECUTING THIS AGREEMENT.
Executed as of this 28th day of April, 1998.
WITNESS: MICHEL L. MARENGERE
/s/ ROSALBA NESPECA /s/ MICHEL L. MARENGERE
- --------------------------- ------------------------------
Signature
ATTEST: DOMINION BRIDGE CORPORATION
By: /s/ ALLEN S. GERRARD
- --------------------------- ---------------------------
Name: Allen S. Gerrard
Title: Director
ATTEST: SERVICES M.L. MARENGERE, INC.
/s/ ROSALBA NESPECA By: /s/ MICHEL L. MARENGERE
- --------------------------- ---------------------------
Name: Michel L. Marengere
Title:
-------------------
<PAGE> 1
EXHIBIT 10.3
SETTLEMENT, RELEASE AND DISCHARGE AGREEMENT
THIS SETTLEMENT RELEASE AND DISCHARGE AGREEMENT (the "Agreement") is
made and entered into as of April 28, 1998, by and among NICOLAS V. MATOSSIAN
("Mr. Matossian"), a resident of Quebec, Canada, GREYHORSE RESOURCES (CANADA),
INC., a Canadian services corporation, which Mr. Matossian controls
("Greyhorse"), and DOMINION BRIDGE CORPORATION, a Delaware corporation (the
"Corporation").
WITNESSETH
WHEREAS, Mr. Matossian is the President and Chief Operating Officer and
Director of the Corporation and also serves as an officer and/or a director of a
number of subsidiaries of the Corporation, whose services are provided by
Greyhorse pursuant to the Services Agreement (as hereinafter defined); and
WHEREAS, subject to the terms and conditions of this Agreement, Mr.
Matossian and Greyhorse and the Corporation have decided to terminate the
Services Agreement dated February 1, 1995 by and between the Corporation and
Greyhorse (the "Services Agreement") effective today, and Mr. Matossian has
decided to resign his positions as President and Chief Operating Officer of the
Corporation, Director of the Corporation, and any other positions he holds with
the Dominion Bridge Parties (as defined in Paragraph 2) effective today; and
WHEREAS, Matossian and Greyhorse claim indemnification from the
Corporation for extra-contractual damages for the libel and defamation of
Greyhorse and for attacks to Mr. Matossian's honor and reputation, stress, loss
of enjoyment of life and moral damages incurred
<PAGE> 2
by them, following the public attacks he was the object of on the part of among
others, Mr. Kandola, Mr. Knai, the plaintiffs in the Miller and Smith cases,
Royal Millenia Group, Ltd., and the "Committee to Revitalize Dominion Bridge
Corporation," all of which were reported in the electronic and print media in
Quebec and in Canada, as well as various personal attacks and moral and physical
threats on the worldwide internet which were reported to the Royal Canadian
Mounted Police and the Montreal Urban Community Police and investigated by
Constable Michel Auclair (Badge No. 4834) and file number 8980403006;
WHEREAS, in settlement of any such extra contractual damages the
Corporation recognizes that Mr. Matossian and Greyhorse may have suffered, the
Corporation desires to indemnify them accordingly; and
WHEREAS, in connection with Mr. Matossian's resignation and the
termination of the services of Greyhorse, Greyhorse and the Corporation desire
to cancel all agreements between or among them and supersede those agreements
with this Agreement and those agreements identified in that certain Closing
Memorandum (the "Closing Memorandum") dated as of April 21, 1998, a copy of
which is attached hereto as Exhibit A;
NOW, THEREFORE, in consideration for the premises, the mutual promises
herein contained, and intending to be legally bound hereby, it is agreed as
follows:
1. The recitals set forth above are incorporated herein as part
of this Agreement.
2. "Dominion Bridge Parties" as used herein, shall at all times
mean Dominion Bridge Corporation, its subsidiaries, successors and assigns, its
affiliated and predecessor companies or corporations, their successors and
assigns, their affiliated and predecessor companies or corporations and the
present or former directors, officers, shareholders, employees,
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<PAGE> 3
attorneys and agents of any of them, whether in their individual or official
capacities, and the current and former trustees or administrators of any pension
or other benefit plan applicable to the employees or former employees of
Dominion Bridge in their official and individual capacities.
3. The Corporation agrees to pay Greyhorse or its assignees for
the said termination and the extra contractual damages, the sum of Two Million
Sixteen Thousand Dollars ($2,016,000). These payments will be made by delivery
at the time of execution of this Agreement to Pouliot Mercure as trustee for
Wellgate International, Ltd. ("Wellgate") of the Corporation's 11.5% Convertible
Note (the "Note") in the principal amount of Four Million Eight Hundred Thousand
Dollars ($4,800,000), in which Greyhorse will have a beneficial interest equal
to $2,016,000. The Note is convertible into shares of Common Stock, $.001 par
value per share, of the Corporation at the conversion rate of $2.60 per share. A
copy of the Note is attached hereto as Exhibit B.
4. As an inducement to Greyhorse to accept the Note pursuant to
Paragraph 3 hereof, Dominion Bridge will issue a Common Stock Purchase Warrant
(the "Warrant") to Wellgate to purchase 333,708 shares of Common Stock, $.001
par value per share, of the Corporation at $3.00 per share for a three (3) year
period commencing on the date hereof in which Greyhorse will have a beneficial
interest to purchase 145,693 shares. A copy of the Warrant is attached hereto as
Exhibit C. The Corporation has also agreed to register the resale of the shares
of Common Stock issuable upon exercise of the Warrant and conversion of the
Note, as applicable, with the United States Securities and Exchange Commission
(the "SEC") pursuant to the terms of a Registration Rights Agreement, a copy of
which is attached hereto as Exhibit D.
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<PAGE> 4
5. Greyhorse represents and agrees that subject to the terms and
conditions contained herein and in those agreements identified in the Closing
Memorandum, it hereby terminates the Services Agreement with the Corporation,
effective today, April 21, 1998. In addition, Mr. Matossian represents and
agrees that subject to the terms and conditions contained herein and in those
agreements identified in the Closing Memorandum, he hereby resigns from his
positions as President, Chief Operating Officer and a Director of the
Corporation and from any and all officer or director positions he holds with any
of the Dominion Bridge Parties.
6. Greyhorse and Mr. Matossian further represent and agree that
they will not apply for, otherwise seek or accept employment with any Dominion
Bridge Party at any time in the future. Any breach of this Paragraph 6 by
Greyhorse or Mr. Matossian will constitute lawful and just cause to refuse to
accept such services and they will have no cause of action against any Dominion
Bridge Party for such refusal.
7. Except as permitted or directed by the Corporation's Board of
Directors or as required by law, Greyhorse and Mr. Matossian shall not utilize,
divulge, furnish or make accessible to anyone any confidential or secret
knowledge or information of the Dominion Bridge Parties, including any trade
secrets, confidential or secret processes, plans, or materials, useful in any
aspect of the business of the Dominion Bridge Parties, any confidential customer
or supplier lists or business plan of the Dominion Bridge Parties, or any other
confidential information or trade secrets of the business of the Dominion Bridge
Parties. Greyhorse and Mr. Matossian acknowledge that the above-described
knowledge or information constitutes a unique and valuable asset of the Dominion
Bridge Parties, acquired at great time and expense by the Dominion Bridge
Parties, and that any disclosure or other use of such knowledge or information
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<PAGE> 5
other than for the sole benefit of the Dominion Bridge Parties, would be
wrongful and would cause irreparable harm to the Dominion Bridge Parties.
8. As a material inducement to the Corporation to enter into this
Agreement and for and in consideration of the terms expressed herein, to the
fullest extent permitted by Delaware law, Greyhorse and Mr. Matossian, for
themselves, their respective successors and assigns, do hereby irrevocably and
unconditionally release and forever discharge the Dominion Bridge Parties of and
from any and all claims, charges, demands, liabilities, obligations, promises,
controversies, damages, rights, actions and causes of action of whatever nature,
kind or character, in law or equity, whether known or unknown ("Claims"), which
Greyhorse and Mr. Matossian now has, may have or claims to have or which
Greyhorse or Mr. Matossian at any time heretofore may have, had or claimed to
have against any Dominion Bridge Party. This release includes, but is not
limited to, those Claims arising from, during or related in any way to Greyhorse
providing services to Dominion Bridge, the termination of the Services
Agreement, Mr. Matossian's positions as a director or officer of any Dominion
Bridge Party, the termination of Mr. Matossian's relationship with the Dominion
Bridge Parties and Mr. Matossian's direct or indirect ownership of stock in
Dominion Bridge. Greyhorse and Mr. Matossian agree not to assert any such Claims
or causes of action released by Greyhorse and Mr. Matossian in this Paragraph.
This release includes, but is not limited to, Claims arising under federal,
state, Canadian provincial, or local statutes, ordinances or common laws,
specifically including, but not limited to, the United States Securities Act of
1933, as amended, the United States Securities Exchange Act of 1934, as amended,
the Civil Rights Act of 1866, the Civil Rights Act of 1871, Title VII of the
Civil Rights Act of 1964, the Civil Rights Act of 1991, the Age Discrimination
in
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<PAGE> 6
Employment Act of 1967, the Rehabilitation Act of 1973, the Older Workers
Benefit Protection Act, the Americans With Disabilities Act, the Employee
Retirement Income Security Act of 1974, Executive Order 112346, the Veterans
Reemployment Statutes, the Family and Medical Leave Act, all as amended, and
Claims pertaining to buying or selling securities, unlawful discrimination, any
common law Claims for breach of contract, wrongful discharge, or otherwise,
and/or Claims for attorneys' fees, and any similar Claims under Canadian
provincial law. Greyhorse and Mr. Matossian agree not to file any lawsuit or a
demand for arbitration against any Dominion Bridge Party asserting a cause of
action for any of the Claims released herein. Greyhorse and Mr. Matossian agree
to pay for any damages (including legal fees or costs) incurred by any Dominion
Bridge Party as a result of any breach of the promises in this Paragraph 8.
Notwithstanding the foregoing, this Paragraph 8 shall not release any Dominion
Bridge Party for any claims for which the Corporation has an indemnification
obligation under this Agreement. Notwithstanding the foregoing release, in the
event of any material breach by the Dominion Bridge Parties of this Agreement or
any agreement identified in the Closing Memorandum, the release set forth in
this Paragraph 8 shall be null and void and of no further force or effect.
Notwithstanding the foregoing, nothing contained herein shall prohibit Greyhorse
or Mr. Matossian from asserting any claim against any of the Dominion Bridge
Parties arising out of or in any way related to the Note, Credit Agreement,
Consulting Agreement or any other agreement identified in the Closing
Memorandum.
9. In the event Greyhorse or Mr. Matossian files a lawsuit
against any Dominion Bridge Party asserting a cause of action for any of the
Claims released herein pursuant to the terms and conditions Paragraph 8 above,
Greyhorse and Mr. Matossian agree to repay to the
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<PAGE> 7
Corporation any sums received by Greyhorse from the Corporation pursuant to
Paragraph 3 of this Agreement. Further, Greyhorse and Mr. Matossian agree to
forfeit any entitlement they have to receive any payments not yet received by
then from the Corporation pursuant to Paragraph 3. Any material breach of this
Agreement by any Dominion Bridge Party shall be considered an event of default
under the Note, Credit Agreement, Consulting Agreement and all other agreements
identified in the Closing Memorandum and Greyhorse and Mr. Matossian may file a
demand for arbitration against the Dominion Bridge Parties pursuant to Paragraph
23. Greyhorse and Mr. Matossian will not be responsible for legal fees incurred
by the Corporation in any arbitration in which the Corporation is found to have
materially breached its obligations under this Agreement.
10. As a material inducement to Greyhorse and Mr. Matossian to
enter into this Agreement and for and in consideration of the terms expressed
herein, the Dominion Bridge Parties themselves, their successors and assigns, do
hereby irrevocably and unconditionally release and forever discharge Greyhorse
and Mr. Matossian of and from any and all Claims for which the fullest extent of
applicable Delaware law would permit the Corporation to indemnify Greyhorse or
Mr. Matossian which the Dominion Bridge Parties now have, may have or claims to
have or (subject to the monetary limitation with respect to the Fiduciary
Deductions, as defined in Paragraph 12) which any Dominion Bridge Party at any
time heretofore may have, had or claimed to have against Greyhorse or Mr.
Matossian. This release includes, subject to all of the provisions of this
Paragraph 10, any and all obligations of Greyhorse or Mr. Matossian with respect
to the Fiduciary Deductions (to the extent disclosed in paragraph 12); and any
and all claims under the Services Agreement. In addition, to the fullest extent
permitted under Delaware
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<PAGE> 8
law, the Corporation shall indemnify Greyhorse and Mr. Matossian from and any
and all liability, loss and damages (including legal fees or costs) which
Greyhorse or Mr. Matossian may be subject to in any claims by any third party
relating to any actions taken by Mr. Matossian in his capacity as an Officer or
Director of any Dominion Bridge Party or any services provided by Greyhorse to
any Dominion Bridge Party. The Dominion Bridge Parties agree not to assert any
such Claims or causes of action released in this Paragraph 10. The Corporation
agrees to pay for any damages (including legal fees or costs) incurred by
Greyhorse or Mr. Matossian as a result of any material breach of the promises of
the Dominion Bridge Parties in this Paragraph 10 and in the event of such
breach, all sums due and owing under the Note, Credit Agreement, Consulting
Agreement and any other agreement identified in the Closing Memorandum shall
become immediately due and payable. The Corporation will not be responsible for
legal fees incurred by Greyhorse or Mr. Matossian in any arbitration in which
Greyhorse or Mr. Matossian is found to have materially breached their
obligations under this Agreement. Notwithstanding the foregoing release, in the
event of any material breach by Greyhorse or Mr. Matossian of this Agreement or
any agreement identified in the Closing Memorandum, the release set forth in
this Paragraph 10 shall be null and void and of no further force or effect.
Notwithstanding the foregoing, nothing contained herein shall prohibit any of
the Dominion Bridge Parties from asserting any claim against Greyhorse or Mr.
Matossian arising out of or in any way related to the Note, Credit Agreement,
Consulting Agreement or any other agreement identified in the Closing
Memorandum.
11. As a material inducement to the Corporation to enter into this
Agreement, Greyhorse and Mr. Matossian represent to the Corporation that to the
best of their actual
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<PAGE> 9
knowledge after due inquiry, the total amount of outstanding fiduciary
deductions in arrears which are due and owing by the Dominion Bridge Parties to
fiduciary creditors, including the Canadian Government, as of March 31, 1998 is
Cdn $15.012 million as set forth in Schedule A attached hereto (the "Fiduciary
Deductions").
12. The Corporation's entire obligation to provide fees, incentive
compensation, bonus, stock, stock awards, stock options, pension, medical
insurance, dental insurance, group-life insurance, split-dollar insurance,
vacation, compensation, benefits, consideration of any kind, or anything else of
value to Greyhorse or Mr. Matossian is set forth in this Agreement and in those
agreements identified in the Closing Memorandum, a copy of which is attached
hereto as Exhibit A. Any other obligation of any Dominion Bridge Party to
provide any of the foregoing to Greyhorse or Mr. Matossian is hereby canceled.
13. In order to insure fairness regarding the use of information
about the Dominion Bridge Parties, Greyhorse and Mr. Matossian agree that for a
period of two (2) years from the date hereof, without the prior written consent
of the Board of Directors of the Corporation, that they will not join with or
become part of (whether by ownership of an equity interest in, other than any
ownership of less than 5 percent of any class of securities of any company which
is a reporting company under the Securities Exchange Act of 1934) or serve as a
partner, director, officer, employee or agent of any corporation, group,
partnership or other entity (each of the foregoing is hereafter referred to as
an "Acquirer") which seeks to acquire all or substantially all of the business
and/or assets of any Dominion Bridge Party including, without limitation of the
foregoing, any such acquisition sought to be effectuated by purchase of all or
any substantial
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<PAGE> 10
portion of the Corporation's voting stock or securities convertible into all or
any substantial portion of the Corporation's voting stock (whether through
open-market purchases(s), privately negotiated purchase(s) or tender offer(s)),
by merger into or with any Party or by purchase of all or substantially all of
the assets of the Corporation or the purchase of all of or a majority of the
outstanding stock of any Dominion Bridge Party. In addition, Greyhorse and Mr.
Matossian agree not to furnish any information concerning or with respect to any
Dominion Bridge Party to any person or entity that Greyhorse or Mr. Matossian
knows or believes is interested in acquiring any Dominion Bridge Party.
14. Each of the parties to this Agreement promises and agrees that
he or it shall make no negative or derogatory comments, oral or written,
directly or by innuendo, about any of the other parties to this Agreement on any
subject, including, but not limited to, comments about another party's business
actions, management, employees, policies, procedures or management-employee
relations. The parties hereby agree that the press release describing the
subject matter of this Agreement attached hereto as Exhibit D shall be
disseminated after this Agreement and all the agreements identified in the
Closing Memorandum have been executed by the parties hereto or thereto, as
applicable.
15. Other than as set forth herein or in any agreement identified
in the Closing Memorandum, a copy of which is attached hereto as Exhibit A, each
of the parties to this Agreement represents that he or it has not heretofore
assigned or transferred, or purported to assign or transfer, to any person or
entity, any claim or any portion thereof or interest therein.
16. Each of the parties to this Agreement represents and warrants
that he or it knows of no claims that he or it has against any of the other
parties to this Agreement and further represents and warrants that he or it
knows of no claims that any other person or entity controlled
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<PAGE> 11
by such party or affiliated with such party has against any of the other parties
to this Agreement. Mr. Matossian further represents and warrants that he is not
now nor has he ever been an employee of any Dominion Bridge Party and that he
has no rights nor has he ever had any rights as an employee of any Dominion
Bridge Party.
17. Except for the representations and warranties made by the
parties in this Agreement or in any agreement identified in the Closing
Memorandum, each of the parties to this Agreement represents and acknowledges
that in executing this Agreement he or it does not rely, and has not relied,
upon any representation or statement made by any of the other parties to this
Agreement by any other party's agents, representatives or attorneys with regard
to the subject matter, basis or effect of this Agreement.
18. The parties to this Agreement have decided it is in their
mutual self-interest to enter into this Agreement. It shall not be construed as
an admission by any party of any act of wrong doing and each party disclaims any
liability to any and all of the other parties except as is set forth in this
Agreement.
19. Any notice from Greyhorse or Mr. Matossian to the Corporation
required under this Agreement shall be sent to Dominion Bridge's Chief Executive
Officer, 500 rue Notre Dame, Lachine, Quebec, Canada, H8S 2B2, or to such other
person or place as the Corporation designates in writing. Any notice from the
Corporation to Greyhorse or Mr. Matossian required under this Agreement shall be
sent to Greyhorse attention: J. Brian Riordan c/o Pouliot Mercure at CIBC Tower,
31st Floor, 1155 rene-Levesque Blvd. West, Montreal, Quebec, Canada H3B 3S6, or
to such other person or place as Greyhorse or Mr. Matossian designates in
writing.
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<PAGE> 12
20. This Agreement shall be binding upon Greyhorse and Mr.
Matossian and upon their respective heirs, administrators, representatives,
executors, successors and assigns, and shall inure to the benefit of the
Dominion Bridge Parties. This Agreement shall be binding on the Dominion Bridge
Parties and its successors and assigns and shall inure to the benefit of
Greyhorse, their respective heirs, administrators, representatives, executors,
successors and assigns.
21. This Agreement is made and entered into in the Province of
Quebec, Canada, and shall in all respects be interpreted, enforced and governed
under the laws of said province; provided, however, that to the extent
specifically provided herein, certain provisions of this Agreement shall be
interpreted in accordance with Delaware law. The language of all parts of this
Agreement shall in all cases be construed as a whole, according to its fair
meaning, and not strictly for or against any of the parties.
22. Should any provision of this Agreement be declared or be
determined to be illegal or invalid, the validity of the remaining parts, terms
or provisions shall not be affected thereby and said illegal or invalid part,
term, or provision shall be deemed not to be a part of this Agreement.
23. In the event of any dispute between the parties, including any
claims, counterclaims, crossclaims or third party claims, whether referring or
relating to any term of this Agreement or any other matter which the parties are
unable to resolve between themselves, at the written request of any party the
matter shall be submitted to arbitration pursuant to the rules of the Canadian
Arbitration Association. Within ten (10) days after receipt of a request for
arbitration, Greyhorse and the Corporation shall each choose an arbitrator and
within ten (10)
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<PAGE> 13
days thereafter the Canadian Arbitration Association shall be requested to
supply a third arbitrator and this request may be made by any party. In the
event Greyhorse or the Corporation does not choose an arbitrator within ten (10)
days, as set forth above, the Canadian Arbitration Association shall also supply
that arbitrator in addition to the third arbitrator. The arbitration shall be
held in Montreal, Quebec, Canada, and shall commence and be completed as soon as
possible under the rules and regulations of the Canadian Arbitration Association
then in effect. In the event of any dispute of any procedural, evidentiary, or
substantive matter, including the arbitrability of the dispute presented, the
decision of the majority of the arbitrators shall be final and conclusive upon
the parties on the matter of dispute.
24. As used in this Agreement, the singular or plural number shall
be deemed to include the other whenever the context so indicates or requires.
25. This Agreement is part of a larger transaction involving
numerous additional agreements all of which are identified in the Closing
Memorandum, a copy of which is attached hereto as Exhibit A. Unless and until
this Agreement and all of the agreements identified in the Closing Memorandum
are executed by the parties hereto or thereto, as applicable, this Agreement
shall not be binding upon the parties hereto.
26. This Agreement, and any agreement identified in the Closing
Memorandum, a copy of which is attached hereto as Exhibit A, sets forth the
entire agreement between the parties hereto and fully supersedes any and all
prior agreements or understandings between or among the parties hereto. This
Agreement may not be modified unless the parties agree in writing.
27. All dollar figures included in this Agreement represent U.S.
Dollars.
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<PAGE> 14
28. The parties acknowledge that they have required that this
Agreement and all related documents be prepared in English. Les parties
reconnaissent avoir exige que la presente convention et tous les documents
connexes soient rediges en anglais.
-14-
<PAGE> 15
MR. MATOSSIAN, GREYHORSE RESOURCES (CANADA), LTD. AND THE CORPORATION
ACKNOWLEDGE THAT THEY HAVE CAREFULLY READ AND FULLY UNDERSTAND THE PROVISIONS OF
THIS AGREEMENT INCLUDING THE RELEASE OF CLAIMS AND HAS HAD SUFFICIENT TIME AND
OPPORTUNITY TO CONSULT WITH HIS OR ITS PERSONAL FINANCIAL, TAX, AND LEGAL
ADVISORS PRIOR TO EXECUTING THIS AGREEMENT.
Executed as of this ____ day of April, 1998.
WITNESS: NICHOLAS V. MATOSSIAN
/s/ ROSALBA NESPECA /s/ NICOLAS V. MATOSSIAN
- --------------------------- ----------------------------------
Signature
ATTEST: DOMINION BRIDGE CORPORATION
By: /s/ ALLEN S. GERRARD
- --------------------------- -------------------------------
Name: Allen S. Gerrard
Title: Director
ATTEST: GREYHORSE RESOURCES (CANADA), LTD.
/s/ ROSALBA NESPECA By: /s/ NICOLAS V. MATOSSIAN
- --------------------------- -------------------------------
Name: Nicholas V. Matossian
Title:
---------------------
-15-
<PAGE> 1
EXHIBIT 10.4
SETTLEMENT, RELEASE AND DISCHARGE AGREEMENT
THIS SETTLEMENT RELEASE AND DISCHARGE AGREEMENT (the "Agreement") is
made and entered into as of April 28, 1998, by and among RENE AMYOT ("Mr.
Amyot"), a resident of Quebec, Canada, and DOMINION BRIDGE CORPORATION, a
Delaware corporation (the "Corporation").
WITNESSETH
WHEREAS, Mr. Amyot is a Director of the Corporation and a number of
subsidiaries of the Corporation; and
WHEREAS, Mr. Amyot has provided and continues to provide legal and
consulting services to the Corporation pursuant to an arrangement by which he is
paid for services as they are rendered; and
WHEREAS, subject to the terms and conditions of this Agreement, Mr.
Amyot has decided to terminate his arrangement to provide legal and consulting
services to the Corporation effective today, and Mr. Amyot has decided to resign
his positions as a Director of the Corporation, and any other positions he holds
with the Dominion Bridge Parties (as defined in Paragraph 2) effective today;
and
WHEREAS, Mr. Amyot claims indemnification from the Corporation for
extra-contractual damages for the libel and defamation for attacks to Mr.
Amyot's honor and reputation, stress, loss of enjoyment of life and moral
damages incurred by him, following the public attacks he was the object of on
the part of among others, Mr. Kandola, Mr. Knai, the plaintiffs in the Miller
and Smith cases, Royal Millenia Group, Ltd., and the "Committee to
<PAGE> 2
Revitalize Dominion Bridge Corporation," all of which were reported in the
electronic and print media in Quebec and in Canada, as well as various personal
attacks and moral and physical threats on the worldwide internet which were
reported to the Royal Canadian Mounted Police and the Montreal Urban Community
Police and investigated by Constable Michel Auclair (Badge No. 4834) and file
number 8980403006; and
WHEREAS, in settlement of any such extra contractual damages the
Corporation recognizes that Mr. Amyot may have suffered, the Corporation desires
to indemnify him accordingly; and
WHEREAS, in connection with Mr. Amyot's resignation and the termination
of the services of and his arrangement with the Corporation, Mr. Amyot and the
Corporation desire to cancel all agreements between them and supersede those
agreements with this Agreement and those agreements identified in that certain
Closing Memorandum (the "Closing Memorandum") dated as of April 21, 1998, a copy
of which is attached hereto as Exhibit A;
NOW, THEREFORE, in consideration for the premises, the mutual promises
herein contained, and intending to be legally bound hereby, it is agreed as
follows:
1. The recitals set forth above are incorporated herein as part of this
Agreement.
2. "Dominion Bridge Parties" as used herein, shall at all times mean
Dominion Bridge Corporation, its subsidiaries, successors and assigns, its
affiliated and predecessor companies or corporations, their successors and
assigns, their affiliated and predecessor companies or corporations and the
present or former directors, officers, shareholders, employees, attorneys and
agents of any of them, whether in their individual or official capacities, and
the current and former trustees or administrators of any pension or other
benefit plan applicable to
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<PAGE> 3
the employees or former employees of Dominion Bridge in their official and
individual capacities.
3. The Corporation agrees to pay or its assignees for the said
termination and the extra contractual damages, the sum of Eighty Four Thousand
Dollars ($84,000). These payments will be made by delivery at the time of
execution of this Agreement to Pouliot Mercure as trustee for Wellgate
International, Ltd. ("Wellgate") of the Corporation's 11.5% Convertible Note
(the "Note") in the principal amount of Four Million Eight Hundred Thousand
Dollars ($4,800,000), in which will have a beneficial interest equal to $84,000.
The Note is convertible into shares of Common Stock, $.001 par value per share,
of the Corporation at the conversion rate of $2.60 per share. A copy of the Note
is attached hereto as Exhibit B.
4. As an inducement to accept the Note pursuant to Paragraph 3 hereof,
Dominion Bridge will issue a Common Stock Purchase Warrant (the "Warrant") to
Wellgate to purchase 333,708 shares of Common Stock, $.001 par value per share,
of the Corporation at $3.00 per share for a three (3) year period commencing on
the date hereof in which he will have a beneficial interest to purchase 604
shares. A copy of the Warrant is attached hereto as Exhibit C. The Corporation
has also agreed to register the resale of the shares of Common Stock issuable
upon exercise of the Warrant and conversion of the Note, as applicable, with the
United States Securities and Exchange Commission (the "SEC") pursuant to the
terms of a Registration Rights Agreement, a copy of which is attached hereto as
Exhibit D.
5. Mr. Amyot represents and agrees that subject to the terms and
conditions contained herein and in those agreements identified in the Closing
Memorandum, he hereby terminates by arrangement with the Corporation, effective
today, April 21, 1998. In addition, Mr. Amyot represents and agrees that subject
to the terms and conditions contained herein and in
3
<PAGE> 4
those agreements identified in the Closing Memorandum, he hereby resigns from
his position as a Director of the Corporation and from any and all director
positions he holds with any of the Dominion Bridge Parties.
6. Mr. Amyot further represents and agrees that he will not apply for,
otherwise seek or accept employment with any Dominion Bridge Party at any time
in the future. Any breach of this Paragraph 6 by Mr. Amyot will constitute
lawful and just cause to refuse to accept such services and he will have no
cause of action against any Dominion Bridge Party for such refusal.
7. Except as permitted or directed by the Corporation's Board of
Directors or as required by law, Mr. Amyot shall not utilize, divulge, furnish
or make accessible to anyone any confidential or secret knowledge or information
of the Dominion Bridge Parties, including any trade secrets, confidential or
secret processes, plans, or materials, useful in any aspect of the business of
the Dominion Bridge Parties, any confidential customer or supplier lists or
business plan of the Dominion Bridge Parties, or any other confidential
information or trade secrets of the business of the Dominion Bridge Parties. Mr.
Amyot acknowledges that the above-described knowledge or information constitutes
a unique and valuable asset of the Dominion Bridge Parties, acquired at great
time and expense by the Dominion Bridge Parties, and that any disclosure or
other use of such knowledge or information other than for the sole benefit of
the Dominion Bridge Parties, would be wrongful and would cause irreparable harm
to the Dominion Bridge Parties.
8. As a material inducement to the Corporation to enter into this
Agreement and for and in consideration of the terms expressed herein, to the
fullest extent permitted by Delaware law, Mr. Amyot, for himself, his successors
and assigns, does hereby irrevocably and unconditionally release and forever
discharge the Dominion Bridge Parties of and from any and
4
<PAGE> 5
all claims, charges, demands, liabilities, obligations, promises, controversies,
damages, rights, actions and causes of action of whatever nature, kind or
character, in law or equity, whether known or unknown ("Claims"), which Mr.
Amyot now has, may have or claims to have or which Mr. Amyot at any time
heretofore may have, had or claimed to have against any Dominion Bridge Party.
This release includes, but is not limited to, those Claims arising from, during
or related in any way to providing services to Dominion Bridge, Mr. Amyot's
positions as a director of any Dominion Bridge Party, the termination of Mr.
Amyot's relationship with the Dominion Bridge Parties and Mr. Amyot's direct or
indirect ownership of stock in Dominion Bridge. Mr. Amyot agrees not to assert
any such Claims or causes of action released by Mr. Amyot in this Paragraph.
This release includes, but is not limited to, Claims arising under federal,
state, Canadian provincial, or local statutes, ordinances or common laws,
specifically including, but not limited to, the United States Securities Act of
1933, as amended, the United States Securities Exchange Act of 1934, as amended,
the Civil Rights Act of 1866, the Civil Rights Act of 1871, Title VII of the
Civil Rights Act of 1964, the Civil Rights Act of 1991, the Age Discrimination
in Employment Act of 1967, the Rehabilitation Act of 1973, the Older Workers
Benefit Protection Act, the Americans With Disabilities Act, the Employee
Retirement Income Security Act of 1974, Executive Order 112346, the Veterans
Reemployment Statutes, the Family and Medical Leave Act, all as amended, and
Claims pertaining to buying or selling securities, unlawful discrimination, any
common law Claims for breach of contract, wrongful discharge, or otherwise,
and/or Claims for attorneys' fees, and any similar Claims under Canadian
provincial law. Mr. Amyot agrees not to file any lawsuit or a demand for
arbitration against any Dominion Bridge Party asserting a cause of action for
any of the Claims released herein. Mr. Amyot agrees
5
<PAGE> 6
to pay for any damages (including legal fees or costs) incurred by any Dominion
Bridge Party as a result of any breach of the promises in this Paragraph 8.
Notwithstanding the foregoing, this Paragraph 8 shall not release any Dominion
Bridge Party for any claims for which the Corporation has an indemnification
obligation under this Agreement. Notwithstanding the foregoing release, in the
event of any material breach by the Dominion Bridge Parties of this Agreement or
any agreement identified in the Closing Memorandum, the release set forth in
this Paragraph 8 shall be null and void and of no further force or effect.
Notwithstanding the foregoing, nothing contained herein shall prohibit Mr. Amyot
from asserting any claim against any of the Dominion Bridge Parties arising out
of or in any way related to the Note, Credit Agreement, Consulting Agreement or
any other agreement identified in the Closing Memorandum.
9. In the event Mr. Amyot files a lawsuit against any Dominion Bridge
Party asserting a cause of action for any of the Claims released herein pursuant
to the terms and conditions Paragraph 8 above, Mr. Amyot agree to repay to the
Corporation any sums received by him from the Corporation pursuant to Paragraph
3 of this Agreement. Further, Mr. Amyot agrees to forfeit any entitlement he has
to receive any payments not yet received by him from the Corporation pursuant to
Paragraph 3. Any material breach of this Agreement by any Dominion Bridge Party
shall be considered an event of default under the Note, Credit Agreement,
Consulting Agreement and all other agreements identified in the Closing
Memorandum and Mr. Amyot may file a demand for arbitration against the Dominion
Bridge Parties pursuant to Paragraph 23. Mr. Amyot will not be responsible for
legal fees incurred by the Corporation in any arbitration in which the
Corporation is found to have materially breached its obligations under this
Agreement.
6
<PAGE> 7
10. As a material inducement to Mr. Amyot to enter into this Agreement
and for and in consideration of the terms expressed herein, the Dominion Bridge
Parties themselves, their successors and assigns, do hereby irrevocably and
unconditionally release and forever discharge Mr. Amyot of and from any and all
Claims for which the fullest extent of applicable Delaware law would permit the
Corporation to indemnify Mr. Amyot which the Dominion Bridge Parties now have,
may have or claims to have or (subject to the monetary limitation with respect
to the Fiduciary Deductions, as defined in Paragraph 12) which any Dominion
Bridge Party at any time heretofore may have, had or claimed to have against Mr.
Amyot. This release includes, subject to all of the provisions of this Paragraph
10, any and all obligations of Mr. Amyot with respect to the Fiduciary
Deductions (to the extent disclosed in paragraph 12); any and all obligations of
Fidutech International, Inc., a company controlled by Mr. Amyot, under that
certain guarantee provided in connection with the Corporation's sale of Edinov;
and any and all obligations of Fidutech Technologies, Inc., a company controlled
by Mr. Amyot, under that certain subscription receivable in the principal amount
of $1.824 million. In addition, to the fullest extent permitted under applicable
Delaware law, the Corporation shall indemnify Mr. Amyot from any and all
liability, loss and damages (including legal fees or costs) which Mr. Amyot may
be subject to in any claims by any third party relating to any actions taken by
Mr. Amyot in his capacity as a Director of any Dominion Bridge Party or any
services provided by Mr. Amyot to any Dominion Bridge Party. The Dominion Bridge
Parties agree not to assert any such Claims or causes of action released in this
Paragraph 10. The Corporation agrees to pay for any damages (including legal
fees or costs) incurred by Mr. Amyot as a result of any material breach of the
promises of the Dominion Bridge Parties in this Paragraph 10 and in the event of
such breach, all sums due and owing under the Note, Credit Agreement, Consulting
Agreement and any other agreement
7
<PAGE> 8
identified in the Closing Memorandum shall become immediately due and payable.
The Corporation will not be responsible for legal fees incurred by Mr. Amyot in
any arbitration in which Mr. Amyot is found to have materially breached their
obligations under this Agreement. Notwithstanding the foregoing release, in the
event of any material breach by Mr. Amyot of this Agreement or any agreement
identified in the Closing Memorandum, the release set forth in this Paragraph 10
shall be null and void and of no further force or effect. Notwithstanding the
foregoing, nothing contained herein shall prohibit any of the Dominion Bridge
Parties from asserting any claim against Mr. Amyot arising out of or in any way
related to the Note, Credit Agreement, Consulting Agreement or any other
agreement identified in the Closing Memorandum.
11. As a material inducement to the Corporation to enter into this
Agreement, Mr. Amyot represents to the Corporation that to the best of their
actual knowledge after due inquiry, the total amount of outstanding fiduciary
deductions in arrears which are due and owing by the Dominion Bridge Parties to
fiduciary creditors, including the Canadian Government, as of March 31, 1998 is
Cdn $15.012 million as set forth in Schedule A attached hereto (the "Fiduciary
Deductions").
12. The Corporation's entire obligation to provide fees, incentive
compensation, bonus, stock, stock awards, stock options, pension, medical
insurance, dental insurance, group-life insurance, split-dollar insurance,
vacation, compensation, benefits, consideration of any kind, or anything else of
value to Mr. Amyot is set forth in this Agreement and in those agreements
identified in the Closing Memorandum, a copy of which is attached hereto as
Exhibit A. Any other obligation of any Dominion Bridge Party to provide any of
the foregoing Mr. Amyot is hereby canceled.
8
<PAGE> 9
13. In order to insure fairness regarding the use of information about
the Dominion Bridge Parties, Mr. Amyot agrees that for a period of two (2) years
from the date hereof, without the prior written consent of the Board of
Directors of the Corporation, that they will not join with or become part of
(whether by ownership of an equity interest in, other than any ownership of less
than 5 percent of any class of securities of any company which is a reporting
company under the Securities Exchange Act of 1934) or serve as a partner,
director, officer, employee or agent of any corporation, group, partnership or
other entity (each of the foregoing is hereafter referred to as an "Acquirer")
which seeks to acquire all or substantially all of the business and/or assets of
any Dominion Bridge Party including, without limitation of the foregoing, any
such acquisition sought to be effectuated by purchase of all or any substantial
portion of the Corporation's voting stock or securities convertible into all or
any substantial portion of the Corporation's voting stock (whether through
open-market purchases(s), privately negotiated purchase(s) or tender offer(s)),
by merger into or with any Party or by purchase of all or substantially all of
the assets of the Corporation or the purchase of all of or a majority of the
outstanding stock of any Dominion Bridge Party. In addition, Mr. Amyot agrees
not to furnish any information concerning or with respect to any Dominion Bridge
Party to any person or entity that Mr. Amyot knows or believes is interested in
acquiring any Dominion Bridge Party.
14. Each of the parties to this Agreement promises and agrees that he
or it shall make no negative or derogatory comments, oral or written, directly
or by innuendo, about any of the other parties to this Agreement on any subject,
including, but not limited to, comments about another party's business actions,
management, employees, policies, procedures or management-employee relations.
The parties hereby agree that the press release describing the subject matter of
this Agreement attached hereto as Exhibit D shall be disseminated after this
Agreement and all
9
<PAGE> 10
the agreements identified in the Closing Memorandum have been executed by the
parties hereto or thereto, as applicable.
15. Other than as set forth herein or in any agreement identified in
the Closing Memorandum, a copy of which is attached hereto as Exhibit A, each of
the parties to this Agreement represents that he or it has not heretofore
assigned or transferred, or purported to assign or transfer, to any person or
entity, any claim or any portion thereof or interest therein.
16. Each of the parties to this Agreement represents and warrants that
he or it knows of no claims that he or it has against any of the other parties
to this Agreement and further represents and warrants that he or it knows of no
claims that any other person or entity controlled by such party or affiliated
with such party has against any of the other parties to this Agreement. Mr.
Amyot further represents and warrants that he is not now nor has he ever been an
employee of any Dominion Bridge Party and that he has no rights nor has he ever
had any rights as an employee of any Dominion Bridge Party.
17. Except for the representations and warranties made by the parties
in this Agreement or in any agreement identified in the Closing Memorandum, each
of the parties to this Agreement represents and acknowledges that in executing
this Agreement he or it does not rely, and has not relied, upon any
representation or statement made by any of the other parties to this Agreement
by any other party's agents, representatives or attorneys with regard to the
subject matter, basis or effect of this Agreement.
18. The parties to this Agreement have decided it is in their mutual
self-interest to enter into this Agreement. It shall not be construed as an
admission by any party of any act of wrong doing and each party disclaims any
liability to any and all of the other parties except as is set forth in this
Agreement.
10
<PAGE> 11
19. Any notice from Mr. Amyot to the Corporation required under this
Agreement shall be sent to Dominion Bridge's Chief Executive Officer, 500 rue
Notre Dame, Lachine, Quebec, Canada, H8S 2B2, or to such other person or place
as the Corporation designates in writing. Any notice from the Corporation to Mr.
Amyot required under this Agreement shall be sent to attention: J. Brian Riordan
c/o Pouliot Mercure at CIBC Tower, 31st Floor, 1155 rene-Levesque Blvd. West,
Montreal, Quebec, Canada H3B 3S6, or to such other person or place as Mr. Amyot
designates in writing.
20. This Agreement shall be binding upon Mr. Amyot and upon his heirs,
administrators, representatives, executors, successors and assigns, and shall
inure to the benefit of the Dominion Bridge Parties. This Agreement shall be
binding on the Dominion Bridge Parties and its successors and assigns and shall
inure to the benefit of, their respective heirs, administrators,
representatives, executors, successors and assigns.
21. This Agreement is made and entered into in the Province of Quebec,
Canada, and shall in all respects be interpreted, enforced and governed under
the laws of said province; provided, however, that to the extent specifically
provided herein, certain provisions of this Agreement shall be interpreted in
accordance with Delaware law. The language of all parts of this Agreement shall
in all cases be construed as a whole, according to its fair meaning, and not
strictly for or against any of the parties.
22. Should any provision of this Agreement be declared or be determined
to be illegal or invalid, the validity of the remaining parts, terms or
provisions shall not be affected thereby and said illegal or invalid part, term,
or provision shall be deemed not to be a part of this Agreement.
11
<PAGE> 12
23. In the event of any dispute between the parties, including any
claims, counterclaims, crossclaims or third party claims, whether referring or
relating to any term of this Agreement or any other matter which the parties are
unable to resolve between themselves, at the written request of any party the
matter shall be submitted to arbitration pursuant to the rules of the Canadian
Arbitration Association. Within ten (10) days after receipt of a request for
arbitration, Mr. Amyot and the Corporation shall each choose an arbitrator and
within ten (10) days thereafter, the Canadian Arbitration Association shall be
requested to supply a third arbitrator and this request may be made by any
party. In the event the Corporation or Mr. Amyot does not choose an arbitrator
within ten (10) days, as set forth above, the Canadian Arbitration Association
shall also supply that arbitrator in addition to the third arbitrator. The
arbitration shall be held in Montreal, Quebec, Canada, and shall commence and be
completed as soon as possible under the rules and regulations of the Canadian
Arbitration Association then in effect. In the event of any dispute of any
procedural, evidentiary, or substantive matter, including the arbitrability of
the dispute presented, the decision of the majority of the arbitrators shall be
final and conclusive upon the parties on the matter of dispute.
24. As used in this Agreement, the singular or plural number shall be
deemed to include the other whenever the context so indicates or requires.
25. This Agreement is part of a larger transaction involving numerous
additional agreements all of which are identified in the Closing Memorandum, a
copy of which is attached hereto as Exhibit A. Unless and until this Agreement
and all of the agreements identified in the Closing Memorandum are executed by
the parties hereto or thereto, as applicable, this Agreement shall not be
binding upon the parties hereto.
12
<PAGE> 13
26. This Agreement, and any agreement identified in the Closing
Memorandum, a copy of which is attached hereto as Exhibit A, sets forth the
entire agreement between the parties hereto and fully supersedes any and all
prior agreements or understandings between or among the parties hereto. This
Agreement may not be modified unless the parties agree in writing.
27. All dollar figures included in this Agreement represent U.S.
Dollars.
28. The parties acknowledge that they have required that this Agreement
and all related documents be prepared in English. Les parties reconnaissent
avoir exige que la presente convention et tous les documents connexes soient
rediges en anglais.
13
<PAGE> 14
MR. AMYOT AND THE CORPORATION ACKNOWLEDGE THAT THEY HAVE CAREFULLY READ AND
FULLY UNDERSTAND THE PROVISIONS OF THIS AGREEMENT INCLUDING THE RELEASE OF
CLAIMS AND HAS HAD SUFFICIENT TIME AND OPPORTUNITY TO CONSULT WITH HIS OR ITS
PERSONAL FINANCIAL, TAX, AND LEGAL ADVISORS PRIOR TO EXECUTING THIS AGREEMENT.
Executed as of this 28th day of April, 1998.
WITNESS: RENE AMYOT
/s/ Rene Amyot
- -------------------------------- ----------------------------------
Signature
ATTEST: DOMINION BRIDGE CORPORATION
By: /s/ Allen S. Gerrard
- -------------------------------- ----------------------------------
Name Allen S. Gerrard
-------------------------
Title: Director
14
<PAGE> 1
EXHIBIT 10.5
CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (the "AGREEMENT") is made as of the 24th day
of April, 1998 by and between Lamar Investments, Inc., an Illinois corporation
(the "COMPANY"), and Wellgate International, Ltd., a British Virgin Islands
corporation ("CONSULTANT").
RECITALS
A. Consultant is an international consulting firm that has retained the
services of three (3) former executives of Dominion Bridge Corporation, a
Delaware corporation ("DBC"), and certain subsidiaries and affiliates of DBC
(collectively with DBC, the "DOMINION BRIDGE GROUP"), namely, Michel L.
Marengere ("MARENGERE"), Nicolas V. Matossian ("MATOSSIAN") and Rene Amyot
("AMYOT") (collectively, the "EXECUTIVES").
B. The Company and/or certain of its affiliates (the "LAMAR GROUP") are
shareholders of common stock of DBC.
C. The Company desires to retain Consultant, and Consultant desires to
be so retained, subject to the terms, conditions and covenants hereinafter set
forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Company and
Consultant hereby agree as follows:
ARTICLE I
CONSULTING SERVICES
1.1. Agreement. The Company hereby retains Consultant, and Consultant
hereby accepts such engagement, pursuant to the terms and conditions set forth
herein.
1.2. Term. The term of this Agreement shall be for a three (3) year
period commencing on the date hereof (the "CONSULTING TERM"). Notwithstanding
the provisions of this Section 1.2, this Agreement may be terminated prior to
the expiration of the Consulting Term in accordance with the provisions of
Article II hereof.
1.3. Activities and Duties.
(a) Consultant hereby agrees to make each of the Executives
available, upon the reasonable request of the Company, such request to
be in the form of Exhibit A hereto
<PAGE> 2
(with all blanks appropriately completed), to provide transitional
assistance to, and assist with respect to matters involving collection
of claims, and litigation and arbitration matters involving, the
Dominion Bridge Group.
(b) Consultant represents and warrants to the Company that it
is free to enter into this Agreement with the Company, and that it has
secured the commitment of the Executives to provide services on its
behalf hereunder.
(c) Consultant hereby agrees that all consulting services
performed by it during the Consulting Term shall be conducted in the
name of Lamar Investments, Inc. Consultant further agrees that it shall
not subcontract any services assigned to it by the Company, or engage
or permit any person or entity other than the Executives to perform any
such services, without the prior written consent of the Company.
1.4. Independent Contractor. Consultant and the Company expressly
acknowledge that no employment, partnership or joint venture relationship is
created by this Agreement, and hereby agree as follows:
(a) Consultant shall act at all times as an independent
contractor hereunder;
(b) Neither Consultant nor anyone employed by or acting for or
on behalf of Consultant, including the Executives, shall ever be or be
construed as an employee of the Company and the Company shall not be
liable for consulting or withholding taxes respecting Consultant or any
employee of Consultant;
(c) Consultant shall determine when, where and how Consultant
shall perform its services hereunder;
(d) Consultant shall take all steps to ensure that Consultant
is treated as an independent contractor of the Company;
(e) Consultant shall provide Consultant's own materials, tools
and equipment in performing the services;
(f) Consultant shall not make any commitment or incur any
charge or expense in the name of the Company without the prior written
approval of the Company;
(g) Except to the extent expressly provided in Article III,
without the prior written consent of the Company, neither Consultant
nor anyone employed by or acting for or on behalf of Consultant,
including the Executives, shall receive or be entitled to any
consideration, compensation or benefits of any kind from the Company,
including without limitation, pension, profit sharing or similar plans
or benefits, or accident, health, medical, life or disability insurance
benefits or coverages; and
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<PAGE> 3
(h) To the extent permitted by law, Consultant, for Consultant
and for anyone claiming through Consultant, waives any and all rights
to any consideration, compensation or benefits, except as expressly
provided for herein or in that certain Closing Memorandum of even date
herewith among, inter alia, the parties hereto.
ARTICLE II
TERMINATION/ATTORNEY FEES
2.1. Termination of Consulting Term. Notwithstanding Section 1.2
hereof, the Consulting Term shall terminate upon the occurrence of any of the
following events: (a) upon the mutual written agreement of the Company and
Consultant; or (b) upon a Material Breach (as hereinafter defined) in the
performance or observance of the duties and obligations to be performed on
behalf of Consultant by the Executives pursuant to this Agreement, which
Material Breach shall continue for a period of thirty (30) days after written
notice thereof from the Company to Consultant; or (c) at any time upon
prepayment by the Company of its financial obligations hereunder in accordance
with Section 3.3. For purposes of Section 2.1(b), the term "Material Breach"
shall mean the refusal of both Marengere and Matossian to provide any services
with respect to a matter that (i) is of critical importance to the Dominion
Bridge Group, and (ii) with regard to which Marengere or Matossian have
particular ability or knowledge. In the event Consultant is terminated pursuant
to Section 2.1(b), the Company shall only be obligated to pay Consultant such
compensation as has been earned by it prior to the date of termination.
2.2. Attorneys' Fees. In the event of a breach of any provision of this
Agreement, the breaching party shall pay to the non-breaching party, in addition
to any other damages or remedies which may be available at law or in equity, all
of its attorneys' fees and costs reasonably incurred as a result of such breach.
ARTICLE III
COMPENSATION
3.1. Compensation. In consideration for performance of Consultant's
services hereunder, during the Consulting Term, the Company shall pay Consultant
the sum of $483,333.33 per year (the "CONSULTING FEES"), of which $250,000,
$150,000 and $83,333.333 shall be allocated for the services to be performed on
behalf of Consultant by Marengere, Matossian and Amyot, respectively. All
amounts due and owing under this Section 3.1 shall be payable in equal monthly
installments during the Consulting Term, which installments shall be due on or
before the last day of each month, with the first payment calculated on a pro
rated basis and due on April 30, 1998. In the event any installment payment is
not made by the Company within thirty (30) days after the date upon which it is
due, the Company will be in default hereunder. Consultant shall then be entitled
to request that Dominion Bridge Corporation cure
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<PAGE> 4
such default. In the event Dominion Bridge Corporation does not cure such
default within thirty (30) days of its receipt of a written request from
Consultant regarding same, Consultant shall be entitled, at its option, to
terminate this Agreement, and in such event, the Company and Dominion Bridge
Corporation shall be jointly and severally liable to pay liquidated damages to
Consultant in an amount equal to the unpaid balance due and owing for services
already performed hereunder plus the net present value of all future amounts due
and payable during the balance of the Term, which net present value shall be
determined as of the date of payment of such sum by applying a discount rate
equal to eleven and one-half percent (11.5%) per annum.
3.2. Death of Marengere and Matossian. Notwithstanding anything to the
contrary contained herein, in the event of the death of both Marengere and
Matossian, so long as upon the date of death of the second of such individuals
to pass away, an uncured Material Breach by Consultant has not continued for a
period of thirty days after written notice thereof from the Company to
Consultant, the Consulting Fees shall continue to be payable to Consultant
during the remainder of the Term.
3.3. Right to Prepay. The Company shall have the right, at any time
during the Consulting Term, to prepay all amounts due and owing under this
Agreement. If the Company elects to prepay the amounts payable hereunder, such
prepayment shall be calculated based on the net present value of such amounts on
the date of prepayment, which shall be determined by applying a discount rate
equal to eleven and one-half percent (11.5%) per annum.
ARTICLE IV
MISCELLANEOUS
4.1. Indemnification.
(a) Consultant hereby agrees to defend, indemnify and hold
harmless the Company and its affiliates, members, managers, officers, agents,
employees, representatives, successors and assigns from and against any and all
claims, demands, causes of action, losses, damages, costs and expenses
(including, without limitation, litigation costs, reasonable attorneys' fees and
any appellate bonds) (collectively, "CLAIMS") arising out of or relating to
Consultant's material breach of any provision contained in this Agreement.
(b) The Company hereby agrees to defend, indemnify and hold
harmless Consultant and its shareholders, officers, directors, successors and
permitted assigns, and the Executives, from and against any and all Claims
arising out of or relating to the Company's material breach of any provision
contained in this Agreement.
4.2. Notices. All notices or other communications required or
permitted hereunder shall be in writing and shall be addressed as follows:
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If to Consultant:
Wellgate International, Ltd.
c/o Pouliot Mercure
CIBC Tower, 31st Floor
1155 Rene-Levesque Boulevard West
Montreal (Quebec) Canada H3B 3S6
Attn: R. Brian Riordan
PH: (514) 875-5210
FAX: (514) 875-4308
If to the Company:
Lamar Investments, Inc.
650 Dundee Road, Suite 460
Northbrook, Illinois 60062
Attn: Leonard Feldman, President
PH: (847) 509-8500
FAX: (847) 509-8529
with a copy to:
Ungaretti & Harris
Three First National Plaza
Suite 3500
Chicago, IL 60602
Attn: Gary I. Levenstein, Esq.
PH: (312) 977-4108
FAX: (312) 977-4405
or to such other address or addresses as may hereafter be specified by notice
given by any of the above to the others. Notices mailed in accordance with this
Section 4.2 shall be deemed given (i) the third day after they are mailed, (ii)
the next day after they are sent by reputable overnight courier service, (iii)
when sent, if sent by telecopy or e-mail between 9:00 A.M. and 5:00 P.M. central
standard time, or (iv) the next business day thereafter if sent by telecopy or
e-mail after 5:00 P.M. central standard time. Any written notice hereunder may
be provided via e-mail, return receipt requested.
4.3. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their successors and permitted
assigns. In the case of the Company, the successors and permitted assigns
hereunder shall include without limitation any affiliate of the Company as well
as the successors in interest to such affiliate (whether by merger, liquidation
(including successive mergers or liquidations) or otherwise). This Agreement or
any right or interest hereunder is one of personal service and may not be
assigned by Consultant. Nothing in this Agreement, expressed or implied, is
intended or shall be construed to confer upon
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<PAGE> 6
any person other than the parties and successors and assigns permitted by this
Section 4.3 any right, remedy or claim under or by reason of this Agreement.
4.4. Entire Agreement; Amendments. This Agreement and the Recitals,
along with the documents described in that certain Closing Memorandum dated of
even date herewith among, inter alia, the parties hereto, contain the entire
understanding of the parties hereto with regard to the subject matter contained
herein, and supersede all prior agreements, understandings or letters of intent
between or among any of the parties hereto. This Agreement shall not be amended,
modified or supplemented except by a written instrument signed by an authorized
representative of each of the parties hereto.
4.5. Interpretation. Article titles and section headings contained
herein are inserted for convenience of reference only and are not intended to be
a part of or to affect the meaning or interpretation of this Agreement.
4.6. Expenses. Each party hereto will pay all costs and expenses
incident to its negotiation and preparation of this Agreement and to its
performance and compliance with all agreements and conditions contained herein
on its part to be performed or complied with, including the fees, expenses and
disbursements of its counsel and accountants.
4.7. Waivers. Any term or provision of this Agreement may be waived, or
the time for its performance may be extended, by the party or parties entitled
to the benefit thereof. Any such waiver shall be validly and sufficiently
authorized for the purposes of this Agreement if, as to any party, it is
authorized in writing by an authorized representative of such party. The failure
of any party hereto to enforce at any time any provision of this Agreement shall
not be construed to be a waiver of such provision, nor in any way to affect the
validity of this Agreement or any part hereof or the right of any party
thereafter to enforce each and every such provision. No waiver of any breach of
this Agreement shall be held to constitute a waiver of any other or subsequent
breach.
4.8. Partial Invalidity. Wherever possible, each provision hereof shall
be interpreted in such manner as to be effective and valid under applicable law,
but in case any one or more of the provisions contained herein shall, for any
reason, be held to be invalid, illegal or unenforceable in any respect, such
provision shall be ineffective to the extent, but only to the extent, of such
invalidity, illegality or unenforceability without invalidating the remainder of
such invalid, illegal or unenforceable provision or provisions or any other
provisions hereof, unless such a construction would be unreasonable.
4.9. Incorporation of Recitals. The recitals set forth on page 1 hereof
are hereby incorporated into and made a part of this Agreement by this
reference.
4.10. Execution in Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be considered an original instrument,
but all of which shall be considered one and the same agreement, and shall
become binding when one or more
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<PAGE> 7
counterparts have been signed by each of the parties hereto and delivered to
each of Consultant and the Company.
4.11. Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws (as opposed to the conflicts of law
provisions) of the Province of Quebec.
4.12. Submission to Jurisdiction. The parties hereto hereby irrevocably
submit in any suit, action or proceeding arising out of or related to this
Agreement to the jurisdiction of courts located in the Province of Quebec,
Canada, and waive any and all objections to jurisdiction that they may have
regarding such jurisdiction.
4.13. Preparation of Agreement in English. The parties acknowledge that
they have required that this Consulting Agreement and all related documents be
prepared in English. Les parties reconnaissent avoir exige que la presente
convention et tous les documents connexes soient rediges en anglais.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
THE COMPANY:
LAMAR INVESTMENTS, INC.
an Illinois corporation
By: /s/ GARY I. LEVENSTEIN
----------------------------
Gary I. Levenstein, as Attorney-in-Fact
for Leonard Feldman, President
CONSULTANT:
WELLGATE INTERNATIONAL, LTD.,
a British Virgin Island corporation
By: /s/ MICHEL L. MARENGERE
----------------------------
Its: Chariman/President
----------------------------
By: /s/ NICOLAS V. MATOSSIAN
----------------------------
Its: Secretary
----------------------------
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<PAGE> 8
\
In order to induce Wellgate International, Ltd. to enter into this Consulting
Agreement and certain other transactions described in that certain Closing
Memorandum dated of even date herewith among, inter alia, the parties hereto, by
executing this document below, Dominion Bridge Corporation hereby guarantees the
payment by Lamar Investments, Inc. of its financial obligations under this
Consulting Agreement.
GUARANTOR:
DOMINION BRIDGE CORPORATION,
a Delaware corporation
By: /s/ ALLEN S. GERRARD
----------------------------
Its: Director
----------------------------
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<PAGE> 1
EXHIBIT 10.6
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (the "Agreement") made and
entered into as of this 21st day of April, 1998, by and among Dominion Bridge
Corporation, a Delaware corporation (the "Company"), Lamar Investments, Inc., an
Illinois corporation and Wellgate International Ltd., a British Virgin Islands
corporation (each an "Investor"and collectively, the "Investors").
BACKGROUND
Pursuant to (i) that certain Investment Letter Agreement and
certain other agreements dated as of April 21, 1998, by and between the Company
and Deere Park Equities, L.L.C.; and (ii) that certain Investment Letter
Agreement and certain other agreements dated as of April 21, 1998 by and between
the Company and Wellgate International Ltd., the Company has agreed to issue to
Investors shares of its Common Stock, par value $.001 per share ("Common
Stock"), upon the exercise of certain Common Stock Purchase Warrants, dated as
of April 21, 1998 (each, a "Warrant") or conversion of certain Subordinated
Convertible Promissory Notes (the "Notes") dated as of April 21, 1998 issued by
the Company and payable to the Investors.
In order to induce Investors and the Company to enter into the
foregoing transactions, the Company has agreed to provide Investors with the
rights set forth in this Agreement.
ARTICLE 1. CERTAIN DEFINITIONS.
In addition to the other terms defined in this Agreement, the
following terms shall be defined as follows:
"American Eco Shares" means the shares of Common Stock, par
value $.001 per share, of the Company issued or issuable to American Eco
Corporation under that certain Securities Purchase Agreement dated as of
February 20, 1998 by and between the Company and American Eco Corporation which
are subject to the terms of that certain Registration Rights Agreement dated as
of February 20, 1998 by and between the Company and American Eco Corporation.
"Brokers' Transactions" has the meaning ascribed to such term
pursuant to Rule 144 under the Securities Act.
"Business Day" means any day on which the New York Stock
Exchange ("NYSE") is open for trading.
<PAGE> 2
"Common Stock" means any outstanding shares of Common Stock of
the Company, as well as any shares issuable upon the exercise of the Warrants or
conversion of the Note.
"Company" means Dominion Bridge Corporation, a Delaware
corporation.
"Demand Registrations" mean all registrations of Registrable
Securities covered by Section 2(a).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC thereunder, all as the same
shall be in effect at the relevant time.
"Holder" means Deere Park Equities, L.L.C. or Wellgate
International Ltd. for so long as (and to the extent that) it owns any
Registrable Securities, and each of its respective successors, assigns, and
direct and indirect transferees who become registered owners of Registrable
Securities or securities exercisable, exchangeable or convertible into
Registrable Securities.
"Outstanding" means with respect to any securities as of any
date, all such securities therefore issued, except any such securities therefore
canceled or held by the Company or any successor thereto whether in its treasury
or not) or any affiliate of the Company or any successor thereto shall not be
deemed "Outstanding" for the purpose of this Agreement.
"Person" means an individual, a partnership (general or
limited), corporation, limited liability company, joint venture, business trust,
cooperative, association or other form of business organization, whether or not
regarded as a legal entity under applicable law, a trust (inter vivos or
testamentary), an estate of a deceased, insane or incompetent person, a
quasi-governmental entity, a government or any agency, authority, political
subdivision or other instrumentality thereof, or any other entity.
"Registrable Security(ies)" means any shares of Common Stock
that may be issued upon the exercise of the Warrants or conversion of the Notes,
and any additional shares of Common Stock or other equity securities of the
Company issued or issuable after the date hereof in respect of any such
securities (or other equity securities issued in respect thereof) by way of a
stock dividend or stock split, in connection with a combination, exchange,
reorganization, recapitalization or reclassification of Company securities, or
pursuant to a merger, division, consolidation or other similar business
transaction or combination involving the Company; provided that: as to any
particular Registrable Securities, such securities shall cease to constitute
Registrable Securities (i) when a registration statement with respect to the
sale of such securities shall have become effective under the Securities Act and
such securities shall have been disposed of thereunder, or (ii) when and to the
extent such securities are permitted to be publicly sold pursuant to Rule 144(k)
(or any successor provision to such Rule) under the Securities Act or are
otherwise freely transferable to the public without further registration under
the Securities Act, or (iii) when such securities shall have ceased to be
Outstanding and, in the case of clause (ii), the Company shall, if requested by
the Holder or Holders thereof, have delivered to such Holder or Holders the
written opinion of independent counsel to the Company to such effect. Any time
this
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<PAGE> 3
Agreement requires the vote or consent of the Holder of a "majority" or
other stated percentage of the Registrable Securities, the term Registrable
Securities shall, solely for purposes of calculating such vote, be deemed to
include the Registrable Securities then issuable under the Warrants and Notes
and any other securities exercisable or exchangeable for, or convertible into,
Registrable Securities.
"Registration Expenses" means all expenses incident to the
Company's performance of or compliance with the registration requirements set
forth in this Agreement including, without limitation, the following: (i) the
fees, disbursements and expenses of the Company's counsel(s), accountants, and
experts in connection with the registration under the Securities Act of
Registrable Securities; (ii) all expenses in connection with the preparation,
printing and filing of the registration statement, any preliminary prospectus or
final prospectus, any other offering documents and amendments and supplements
thereto, and the mailing and delivery of copies thereof to the underwriters and
dealers, if any; (iii) the cost of printing or producing any agreement(s) among
underwriters, underwriting agreement(s) and blue sky or legal investment
memoranda, any selling agreements, and any other documents in connection with
the offering, sale or delivery of Registrable Securities to be disposed of; (iv)
any other expenses in connection with the qualification of Registrable
Securities for offer and sale under state securities laws, including the fees
and disbursements of counsel for the underwriters in connection with such
qualification and in connection with any blue sky and legal investment surveys;
(v) the filing fees incident to securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of Registrable
Securities to be disposed of and any blue sky registration or filing fees, and
(vi) the fees and expenses incurred in connection with the listing of
Registrable Securities on each securities exchange (or NASDAQ National Market
System) on which Company securities of the same class are then listed; provided,
however, that Registration Expenses with respect to any registration pursuant to
this Agreement shall not include (x) expenses of any Holder's counsel, or (y)
any underwriting discounts or commissions attributable to Registrable
Securities, each of which shall be borne by the Holder.
"SEC" means the United States Securities and Exchange
Commission, or such other federal agency at the time having the principal
responsibility for administering the Securities Act.
"Securities Act" means the Securities Act or 1933, as amended,
and the rules and regulations of the SEC thereunder, all as the same shall be in
effect at the relevant time.
ARTICLE 2. DEMAND REGISTRATION.
(a) Commencing after March 31, 1999, Holder or Holders may
request at any time (by written notice delivered to the Company) that the
Company register under the Securities Act all or any portion of the Registrable
Securities held by (or then issuable to) such Holder or Holders (the "Requesting
Holders") for sale in the manner specified in such notice. In each such case,
such notice shall specify the number of Registrable Securities for which
registration is requested, the proposed manner of disposition of such
securities, and the minimum price per share at which the Requesting Holders
would be willing to sell such securities in an underwritten
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<PAGE> 4
offering. The Company shall, within five (5) Business Days after its receipt of
any Requesting Holders' notice under this Section 2(a) give written notice of
such request to all other Holders of Registrable Securities and afford them the
opportunity of including in the requested registration statement such of their
Registrable Securities as they shall specify in a written notice given to the
Company within twenty (20) days after their receipt of the Company's notice.
Within ten (10) Business Days after the expiration of such twenty (20) day
period, the Company shall notify all Holders requesting registration of (A) the
aggregate number of Registrable Securities proposed to be registered by all
Holders, (B) the proposed filing date of the registration statement, and (C)
such other information concerning the offering as any Holder may have reasonably
requested. If the Holders of a majority in aggregate amount of the Registrable
Securities to be included in such offering shall have requested that such
offering be underwritten, the managing underwriter for such offering shall be
chosen by the holders of a majority in aggregate amount of the Registrable
Securities being registered, with the consent of the Company, which consent
shall not be unreasonably withheld, not less than thirty-five (35) days prior to
the proposed filing date stated in the Company's notice, and the Company shall
thereupon promptly notify such Holders as to the identity of the managing
underwriter, if any, for the offering. On or before the 30th day prior to such
anticipated filing date, any Holder may give written notice to the Company and
the managing underwriter specifying either that (A) Registrable Securities of
such Holder are to be included in the underwriting, on the same terms and
conditions as the securities otherwise being sold through the underwriters under
such registration or (B) such Registrable Securities are to be registered
pursuant to such registration statement and sold in the open market without any
underwriting, on terms and conditions comparable to those normally applicable to
offerings in reasonably similar circumstances, regardless of the method of
disposition originally specified in Holder's request for registration.
(b) Company shall use its best efforts to file with the SEC
within ninety (90) days after the Company's receipt of the initial Requesting
Holders' written notice pursuant to Section 2(a), a registration statement for
the public offering and sale, in accordance with the method of disposition
specified by such Holders, of the number of Registrable Securities specified in
such notice, and thereafter use its best efforts to cause such registration
statement to become effective as quickly thereafter as is practicable, provided
that the Company may delay the filing of such registration statement for up to
an additional sixty (60) days if the Company determines that such a delay is
necessary either: (i) to obtain additional financial statements for inclusion in
such registration statement as a result of an acquisition or probable
acquisition of a "significant subsidiary" as such term is defined by the SEC in
Regulation S-X; or (ii) in order to complete or otherwise bring to fruition a
material business combination or proposed material corporate transaction which
in a pending status would render difficult the completion of a registration
statement in accordance with applicable SEC regulations. Such registration
statement may be on Form S-1 or another appropriate form (including Form S-3)
that the Company is eligible to use.
(c) The Company shall not have any obligation hereunder to
register any Registrable Securities under Section 2(a) unless it shall have
received requests from Holders to register at least 40% of the total Registrable
Securities. Further, the Holder(s) shall only have the right to exercise their
rights of demand under this Section 2(a) on two occasions in which the
registration statement is declared effective.
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<PAGE> 5
(d) Notwithstanding anything to the contrary contained herein,
the Company's obligation in Section 2(a) above shall extend only to the
inclusion of the Registrable Securities in a registration statement filed under
the Securities Act. The Company shall have no obligation to assure the terms and
conditions of distribution, to obtain a commitment from an underwriter relative
to the sale of the Registrable Securities or to otherwise assume any
responsibility for the manner, price or terms of the distribution of the
Registrable Securities.
(e) The Company shall not be obligated to effect any Demand
Registration within 180 days after the effective date of a previous underwritten
Demand Registration or a previous registration in which the Holders of
Registrable Securities were given piggyback rights pursuant to Section 3 and in
which there was no reduction in the number of Registrable Securities requested
to be included. The Company may postpone once for up to three months and once
for up to six months the filing or the effectiveness of a registration statement
for a Demand Registration if the Company determines that such Demand
Registration would reasonably be expected to have an adverse effect on any
proposal or plan by the Company or any of its subsidiaries to engage in any
financing, acquisition of assets or any merger, consolidation, tender offer or
other similar transaction; provided that in such event, the Holders of
Registrable Securities initially requesting such Demand Registration shall be
entitled to withdraw such request and, if such request is withdrawn, such Demand
Registration shall not count as one of the Demand Registrations permitted to
Holders of Registrable Securities hereunder and the Company shall pay all
Registration Expenses in connection with such registration; and provided further
that the Company may exercise such right only once in any 12-month period.
ARTICLE 3. PIGGYBACK REGISTRATIONS.
(a) Right to Piggyback. If at any time after the date hereof,
the Company proposes to file a registration statement under the Securities Act
(except with respect to registration statements on Forms S-4, S-8, or any other
form not available for registering the Registrable Securities for sale to the
public), with respect to an offering of Common Stock for its own account or for
the account of another person, then the Company shall in each case give written
notice of such proposed filing to the Holders of Registrable Securities at least
45 days before the anticipated filing date of the registration statement with
respect thereto (the "Piggyback Registration"), and shall, subject to Section
3(b) and 3(c) below, include in such Piggyback Registration such amount of
Registrable Securities as each such Holder may request within 20 days of the
receipt of such notice.
(b) Priority on Primary Registrations. If a Piggyback
Registration is an underwritten primary registration on behalf of the Company,
and the managing underwriters advise the Company in writing that in their
opinion the number of securities requested to be included in such registration
exceeds the number which can be sold in an orderly manner in such offering
within a price range acceptable to the Company, the Company shall include in
such registration (i) first, the securities the Company proposes to sell, (ii)
second, the Registrable Securities and American Eco Shares requested to be
included in such registration to the extent that the number of shares to be
registered will not, in the opinion of the managing underwriters, adversely
affect the offering of the securities pursuant to clause (i), pro rata among the
Holders of
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such Registrable Securities and the holders of the American Eco Shares on the
basis of the number of shares so requested to be included therein owned by such
Persons and (iii) third, provided that all Registrable Securities and American
Eco Shares requested to be included in the registration statement have been so
included, any other securities requested to be included in such registration.
(c) Priority on Secondary Registrations. If a Piggyback
Registration is an underwritten secondary registration on behalf of holders of
the Company's securities other than the Holders of Registrable Securities or
holders of the American Eco Shares, and the managing underwriters advise the
Company in writing that in their opinion the number of securities requested to
be included in such registration exceeds the number which can be sold in an
orderly manner in such offering within a price range acceptable to the holders
initially requesting such registration, the Company shall include in such
registration (i) first, the securities requested to be included therein by the
holders requesting such registration, (ii) second, the Registrable Securities
and American Eco Shares requested to be included in such registration, to the
extent that the number of shares to be registered will not, in the opinion of
the managing underwriters, adversely affect the offering of the securities
pursuant to clause (i), pro rata among the Holders of Registrable Securities and
holders of American Eco Shares on the basis of the number of shares so requested
to be included therein owned by such Persons, and (iii) third, other securities
requested to be included in such registration.
ARTICLE 4. HOLDBACK AGREEMENTS.
(a) Each Holder of Registrable Securities shall not effect any
public sale or distribution (including sales pursuant to Rule 144) of equity
securities of the Company, or any securities convertible into or exchangeable or
exercisable for such securities, during the 10 days prior to and the 120-day
period beginning on the effective date of any underwritten primary registration
undertaken by the Company (except as part of such underwritten registration),
unless the underwriters managing the registered public offering otherwise agree.
(b) The Company shall not effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the 30 days prior to and
during the 120-day period beginning on the effective date of any underwritten
Demand Registration on behalf of the Holders of Registrable Securities (except
as part of such underwritten registration or pursuant to registrations on Form
S-8 or S-4 or any successor form), unless the underwriters managing the
registered public offering otherwise agree.
ARTICLE 5. REGISTRATION PROCEDURES.
Whenever the Holders of Registrable Securities have requested
that any Registrable Securities be registered pursuant to this Agreement, the
Company shall use its best efforts to effect the registration of the resale of
such Registrable Securities and pursuant thereto the Company shall as soon as
practicable:
(a) prepare and file with the SEC a registration statement
with respect to the resale of such Registrable Securities and use its best
efforts to cause such registration statement to
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become effective (provided that before filing a registration statement or
prospectus or any amendments or supplements thereto, the Company shall furnish
to the counsel selected by the Holders of a majority of the Registrable
Securities covered by such registration statement copies of all such documents
proposed to be filed, which documents shall be subject to the review and consent
of such counsel);
(b) notify each Holder of Registrable Securities of the
effectiveness of each registration statement filed hereunder and prepare and
file with the SEC such amendments and supplements to such registration statement
and the prospectus used in connection therewith as may be necessary to keep such
registration statement effective for a period of not less than 180 days and
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the sellers thereof set
forth in such registration statement;
(c) furnish to each seller of Registrable Securities such
number of copies of such registration statement, each amendment and supplement
thereto, the prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as such seller may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such seller;
(d) use its best efforts to register or qualify such
Registrable Securities under such other securities or blue sky laws of such
jurisdictions as any Holder reasonably requests and do any and all other acts
and things which may be reasonably necessary or advisable to enable such seller
to consummate the disposition of the Registrable Securities owned by the sellers
in such jurisdictions (provided that the Company shall not be required to (i)
qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subparagraph, (ii) subject itself
to taxation in any such jurisdiction or (iii) consent to general service of
process in any such jurisdiction);
(e) notify each seller of such Registrable Securities, at any
time when a prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event as a result of which the
prospectus included in such registration statement contains an untrue statement
of a material fact or omits any fact necessary to make the statements therein
not misleading, and, at the request of any such seller, the Company shall
prepare a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
shall not contain an untrue statement of a material fact or omit to state any
fact necessary to make the statements therein not misleading;
(f) cause all such Registrable Securities to be listed on each
securities exchange or trading system on which similar securities issued by the
Company are then listed;
(g) provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement;
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(h) enter into such customary underwriting agreements
(containing terms acceptable to the Company) as the Holders of a majority of the
Registrable Securities being sold or the underwriters, if any, reasonably
request; and
(i) make available for inspection during normal business hours
by any seller of Registrable Securities, any underwriter participating in any
disposition pursuant to such registration statement and any attorney, accountant
or other agent retained by any such seller or underwriter, all financial and
other records, pertinent corporate documents and properties of the Company, and
cause the Company's officers, directors, employees and independent accountants
to supply all information reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with such registration statement.
ARTICLE 6. REGISTRATION EXPENSES.
All Registration Expenses in connection with any of the
registration events identified within this Agreement shall be borne by the
Company. All other expenses shall be borne by the Holders.
ARTICLE 7 INDEMNIFICATION.
(a) The Company agrees to indemnify, to the extent permitted
by law, each Holder of Registrable Securities, its officers and directors and
each Person who controls such Holder (within the meaning of the Securities Act)
against all losses, claims, damages, liabilities and expenses caused by any
untrue statement of material fact contained in any registration statement,
prospectus or preliminary prospectus or any amendment thereof or supplement
thereto or any omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as the
same are caused by or contained in any information furnished to the Company by
such Holder for use therein or by such Holder's failure to deliver a copy of the
registration statement or prospectus or any amendments or supplements thereto
after the Company has furnished such holder with a sufficient number of copies
of the same. In connection with an underwritten offering, the Company shall
provide reasonable and customary indemnification to such underwriters, their
officers and directors and each Person who controls such underwriters (within
the meaning of the Securities Act) to the same extent as provided above with
respect to the indemnification of the Holders of Registrable Securities.
(b) In connection with any registration statement in which a
Holder of Registrable Securities is participating, each such Holder shall
furnish to the Company in writing such information and affidavits as the Company
reasonably requests for use in connection with any such registration statement
or prospectus and, to the extent permitted by law, shall indemnify the Company,
its directors and officers and each Person who controls the Company (within the
meaning of the Securities Act) against any losses, claims, damages, liabilities
and expenses resulting from any untrue or alleged untrue statement of material
fact contained in the registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto or any omission or
alleged omission of a material fact required to be stated therein or necessary
to
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<PAGE> 9
make the statements therein not misleading, but only to the extent that such
untrue statement or omission is contained in any information or affidavit so
furnished by such Holder.
(c) Any Person entitled to indemnification hereunder shall (i)
give prompt written notice to the indemnifying party of any claim with respect
to which it seeks indemnification (provided that the failure to give prompt
notice shall not impair any Person's right to indemnification hereunder to the
extent such failure has not prejudiced the indemnifying party) and (ii) unless
in such indemnified party's reasonable judgment a conflict of interest between
such indemnified and indemnifying parties may exist with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party. If such defense is assumed,
the indemnifying party shall not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent shall not be
unreasonably withheld). An indemnifying party who is not entitled to, or elects
not to, assume the defense of a claim shall not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim.
(d) The indemnification provided for under this Agreement
shall remain in full force and effect regardless of any investigation made by or
on behalf of the indemnified party or any officer, director or controlling
Person of such indemnified party and shall survive the transfer of securities.
The Company also agrees to make such provisions, as are reasonably requested by
any indemnified party, for contribution to such party in the event the Company's
indemnification is unavailable for any reason.
ARTICLE 8 OBLIGATION OF HOLDERS.
(a) In connection with each registration hereunder, each
selling Holder will furnish to the Company in writing such information with
respect to such seller and the securities held by such seller, and the proposed
distribution by them as shall be reasonably requested by the Company in order to
assure compliance with federal and applicable state securities laws, as a
condition precedent to including such seller's Registrable Securities in the
registration statement. Each selling Holder also shall agree to promptly notify
the Company of any changes in such information included in the registration
statement or prospectus as a result of which there is an untrue statement of
material fact or an omission to state any material fact required or necessary to
be stated therein in order to make the statements contained therein not
misleading in light of the circumstances then existing.
(b) In connection with each registration pursuant to this
Agreement, the Holders included therein will not effect sales thereof until
notified by the Company of the effectiveness of the registration statement, and
thereafter will suspend such sales after receipt of telegraphic or written
notice from the Company to suspend sales to permit the Company to correct or
update a registration statement or prospectus. At the end of any period during
which the Company is obligated to keep a registration statement current, the
Holders included in said registration statement shall discontinue sales of
shares pursuant to such registration statement upon receipt of
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<PAGE> 10
notice from the Company of its intention to remove from registration the shares
covered by such registration statement which remain unsold, and such Holders
shall notify the Company of the number of shares registered which remain unsold
immediately upon receipt of such notice from the Company.
ARTICLE 9 INFORMATION BLACKOUT.
(a) At any time when a registration statement effected
pursuant to this Agreement relating to Registrable Securities is effective, upon
written notice from the Company to the Holders that the Company has determined
in good faith that sale of Registrable Securities pursuant to the registration
statement would require disclosure of non-public material information not
otherwise required to be disclosed under applicable law (an "Information
Blackout"), all Holders shall suspend sales of Registrable Securities pursuant
to such registration statement until the earlier of:
(i) thirty (30) days after the Company makes such
good faith determination; and
(ii) such time as the Company notifies the Holders
that such material information has been disclosed to the public or has ceased to
be material or that sales pursuant to such registration statement may otherwise
be resumed (the number of days from such suspension of sales by the Holders
until the day when such sale may be resumed hereunder is hereinafter called a
"Sales Blackout Period").
(b) Notwithstanding the foregoing, there shall be no more than
two (2) Information Blackouts during the term of this Agreement and no Sales
Blackout Period shall continue for more than thirty (30) consecutive days.
ARTICLE 10 MISCELLANEOUS.
(a) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without regard to
that state's conflict of laws provisions.
(b) Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
(c) Amendments and Waivers. Except as otherwise provided
herein, the provisions of this Agreement may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given without the written consent of the Company and the Holders.
(d) Notices. All communications under this Agreement shall be
sufficiently given if delivered by hand or by overnight courier or mailed by
registered or certified mail, postage prepaid, addressed,
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<PAGE> 11
(i) if to the Company, to:
Dominion Bridge Corporation
500 rue Notre Dame
Lachine, Quebec, Canada H8S 2B2
Attention: Chairman
with a copy to:
Joseph P. Galda, Esquire
Buchanan Ingersoll Professional Corporation
11 Penn Center, 14th Floor
1835 Market Street
Philadelphia, PA 19103
or, in the case of the Holders, at such address as each such Holder shall have
furnished in writing to the Company and set forth on the attached notice
schedule; or at such other address as any of the parties shall have furnished in
writing to the other parties hereto.
(e) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(f) Entire Agreement; Survival; Termination. This Agreement is
intended by the parties as a final expression of their agreement and intended to
be a complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
IN WITNESS WHEREOF, intending to be legally bound hereby, the parties
have executed this Agreement as of the date first written above.
DOMINION BRIDGE CORPORATION
By: /s/ ALLEN S. GERRARD
-------------------------
Name: Allen S. Gerrard
Title: Director
HOLDER:
LAMAR INVESTMENTS, INC.
BY: /s/ GARY LEVENSTEIN
-------------------------
Name: Gary Levenstein
Title:
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<PAGE> 12
HOLDER:
WELLGATE INTERNATIONAL LTD.
BY: /s/ MICHEL L. MARENGERE
-----------------------------
Name: Michel L. Marengere
Title: President
BY: /s/ NICOLAS V. MATOSSIAN
-----------------------------
Name: Nicolas V. Matossian
Title: Secretary
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<PAGE> 13
NOTICE SCHEDULE:
List of Holders:
Lamar Investments, Inc.
650 Dundee Road
Suite 460
Northbrook, IL 60062
Attention: Douglas A. Gerrard
Wellgate International Ltd.
c/o Pouliot Mercure
CIBC Tower
31st Floor
1155 Rene-Levesque Blvd. West
Montreal, Quebec, Canada H3B 3S6
Attention: J. Brian Riordan
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