<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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): July 31, 1997
Commission File Number 1-11442
CHART INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
Delaware 34-1712937
- ------------------------------- ---------------------------------------
(State or other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
35555 Curtis Boulevard, Eastlake, OH 44095
------------------------------------------
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code: (216) 946-2525
<PAGE> 2
ITEM 2: ACQUISITION OR DISPOSITION OF ASSETS
On July 31, 1997, Chart Industries, Inc. (the "Company") completed its
acquisition of Cryenco Sciences, Inc. ("Cryenco"), a Delaware corporation, from
the shareholders of Cryenco by means of a merger (the "Merger") between Cryenco
and Chart Acquisition Company, Inc. ("Acquisition"), a Delaware corporation and
a wholly-owned subsidiary of Greenville Tube Corporation ("Greenville"), an
Arkansas corporation and a wholly-owned subsidiary of the Company. The Merger
was accomplished pursuant to a Plan and Agreement of Merger dated as of April
30,1997, among the Company, Greenville, Acquisition and Cryenco (the "Merger
Agreement"). A copy of the Merger Agreement is filed as an Exhibit hereto.
Cryenco manufactures vacuum-jacketed containment systems and related products
for the transportation, storage and dispensing of LNG, LCNG and liquefied argon,
oxygen and nitrogen. Cryenco's products include cryogenic transport
trailers, large cryogenic storage tanks, cryogenic intermodal containers,
LNG/LCNG fueling stations, fuel gas modules and cryostats for MRI and
low-temperature research.
Total consideration for the Merger consisted of the payment to the shareholders
of Cryenco of $19.7 million to purchase the outstanding common stock and
certain warrants of Cryenco and of $685,000 to redeem the outstanding preferred
stock of Cryenco. Pursuant to the Merger Agreement, the Company also entered
into certain Amendments to Warrant Agreements (the "Amended Warrant
Agreements") between the Company, Cryenco, and the holders of certain other
warrants for the purchase of the common stock of Cryenco (the "Cryenco
Warrants"). The Amended Warrant Agreements convert the Cryenco Warrants into
warrants for the purchase of the Company's Common Stock, par value $.01 per
share, at the conversion ratio provided for in the Merger Agreement. The
Cryenco Warrants and the Amended Warrant Agreements are filed as Exhibits
hereto.
The cash consideration for the transaction was made available through a
draw-down of the Company's renegotiated credit facility under a Credit Agreement
by and between the Company and National City Bank and NBD Bank (collectively,
the "Banks"); and National City Bank, as agent for the Banks (the "Agent"),
dated July 29, 1997 (the "Credit Agreement"). A copy of the Credit Agreement is
filed as an Exhibit hereto. The merger will be accounted for under the purchase
method of accounting for financial reporting purposes.
The purchase price and other terms of the Merger Agreement and of the Warrant
Agreements were determined through arms-length negotiations. The Company is not
aware of any pre-existing material relationships between (i) Cryenco or any of
its shareholders, and (ii) the Company, any of the Company's affiliates,
directors and officers or any associate of such directors and officers.
2
<PAGE> 3
ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS
A) FINANCIAL STATEMENTS OF THE BUSINESS ACQUIRED
CRYENCO SCIENCES, INC.
<TABLE>
<CAPTION>
INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) PAGE
----
<S> <C>
Consolidated Balance Sheets as of August 31, 1996 and May 31, 1997 4-5
Consolidated Statements of Operations for both three and nine months
ended May 31, 1996 and May 31, 1997 6
Consolidated Statements of Cash Flows for nine months
ended May 31, 1996 and May 31, 1997 7
Notes to Interim Consolidated Financial Statements 8-10
AUDITED FISCAL 1996 FINANCIAL STATEMENTS
Report of Independent Auditors 11
Consolidated Balance Sheets 12-13
Consolidated Statements of Operations 14
Consolidated Statements of Stockholders' Equity 15
Consolidated Statements of Cash Flows 16-17
Notes to Consolidated Financial Statements 18-29
</TABLE>
3
<PAGE> 4
CRYENCO SCIENCES, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
<TABLE>
<CAPTION>
AUGUST 31, MAY 31,
1996 1997
-----------------------
(audited) (unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 111 $ 426
Accounts receivable, trade 5,352 4,510
Accounts receivable, affiliate 1,423 -
Costs and estimated earnings in excess of
billings on uncompleted contracts 3,944 2,666
Inventories (Note 2) 4,333 5,558
Prepaid expenses 57 100
-----------------------
Total current assets 15,220 13,260
Property and equipment:
Leasehold improvements 739 867
Machinery and equipment 5,355 5,306
Office furniture and equipment 1,231 1,421
-----------------------
7,325 7,594
Less accumulated depreciation 3,099 3,810
-----------------------
4,226 3,784
Property on operating leases 604 51
Deferred financing costs 120 56
Goodwill 5,226 5,114
Other assets 308 199
-----------------------
TOTAL ASSETS $25,704 $22,464
=======================
</TABLE>
4
<PAGE> 5
CRYENCO SCIENCES, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
<TABLE>
<CAPTION>
AUGUST 31, MAY 31,
1996 1997
----------------------
(audited) (unaudited)
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,224 $ 1,490
Accrued expenses 1,123 1,431
Accrued management fees 324 323
Current portion of long-term debt (Note 3) 1,382 294
Income tax payable 344 --
----------------------
Total current liabilities 5,397 3,538
Long-term debt, less current portion (Note 3) 8,634 6,964
----------------------
14,031 10,502
STOCKHOLDERS' EQUITY:
Preferred stock, $0.01 par value,
authorized shares-2,000,000, preferences,
limitations and relative rights to be
established by the Board of Directors:
Series A, nonvoting, 150,000 authorized
shares, 67,838 and 68,517 issued and
outstanding shares (aggregate liquidation
preference of $678,380 and $685,170) 1 1
Common stock, $0.01 par value:
Class A, voting, 21,500,000 authorized
shares, 6,996,997 shares issued and
Outstanding 70 70
Class B, nonvoting, 1,500,000 authorized
shares, none issued or outstanding - -
Additional paid-in capital 14,020 14,027
Warrants 169 169
Retained earnings (deficit) (2,587) (2,305)
----------------------
TOTAL STOCKHOLDERS' EQUITY 11,673 11,962
----------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 25,704 $ 22,464
======================
</TABLE>
5
<PAGE> 6
CRYENCO SCIENCES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share amounts)
(unaudited)
<TABLE>
<CAPTION>
THREE MONTHS THREE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED
MAY 31, 1996 MAY 31, 1997 MAY 31, 1996 MAY 31, 1997
<S> <C> <C> <C> <C>
Contract revenue $ 8,232 $ 7,680 $ 24,420 $ 20,518
Cost of revenue 6,405 6,409 19,544 16,496
--------------------------------------------------------------
Gross profit 1,827 1,271 4,876 4,022
Selling, general and
administrative expenses 894 1,024 2,433 2,510
Research and development
expenses 277 (14) 708 315
Amortization expense 87 59 259 181
--------------------------------------------------------------
Operating income 569 202 1,476 1,016
Other (income) expense:
Interest income 0 0 (1) 0
Interest expense 226 231 666 722
Other expense, net 5 (213) 1 (269)
--------------------------------------------------------------
Income from operations before
income taxes and
extraordinary item 338 184 810 563
Income tax expense 126 68 300 208
--------------------------------------------------------------
Income from operations before
extraordinary item 212 116 510 355
Extraordinary item (net of
income tax benefit of $54)
(Note 4) 0 0 (93) 0
--------------------------------------------------------------
NET INCOME $ 212 $ 116 $ 417 $ 355
==============================================================
Earnings per common and
common equivalent share
(Note 5)
Income from operations
before extraordinary item $ 0.03 $ 0.01 $ 0.06 $ 0.04
Extraordinary item 0.00 0.00 (0.01) 0.00
--------------------------------------------------------------
Net income $ 0.03 $ 0.01 $ 0.05 $ 0.04
==============================================================
WEIGHTED AVERAGE NUMBER OF
SHARES AND COMMON
EQUIVALENT SHARES OUTSTANDING
7,318,413 7,188,423 7,320,789 7,203,180
==============================================================
</TABLE>
6
<PAGE> 7
CRYENCO SCIENCES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED NINE MONTHS ENDED
MAY 31, 1996 MAY 31, 1997
------------------------------------
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 417 $ 355
Adjustments to reconcile net income
to net cash (used) provided by operating activities:
Depreciation 611 868
Amortization 482 245
Gain from sale of assets 0 (259)
Changes in operating assets and liabilities:
Accounts receivable (3,894) 2,265
Costs and estimated earnings in excess of
billings on uncompleted contracts 1,941 1,278
Inventories 14 (1,226)
Income taxes 33 (344)
Prepaid expenses and other assets (159) (1)
Accounts payable (958) (735)
Accrued expenses 190 315
----------------------
Net cash provided (used) by operating activities (1,323) 2,761
----------------------
INVESTING ACTIVITIES
Purchases of property and equipment (1,510) (380)
Proceeds from sale of assets 0 765
----------------------
Net cash provided (used) by investing activities (1,510) 385
----------------------
FINANCING ACTIVITIES
Payments of long-term debt (17,309) (25,180)
Borrowings 19,684 22,421
Dividends paid on preferred stock (67) (72)
----------------------
Net cash provided (used) by financing activities 2,308 (2,831)
----------------------
Net increase (decrease) in cash and cash equivalents (525) 315
Cash and cash equivalents at beginning of period 632 111
----------------------
Cash and cash equivalents at end of period $ 107 $ 426
======================
Supplementary disclosure of cash flow information:
Cash paid for interest $ 590 $ 679
Cash paid for taxes 319 562
Supplementary disclosure of non cash financing activity:
Issuance of preferred stock in consideration for
dividends payable $ 2 $ 7
Equipment acquired and financed under
capital leases 304 0
</TABLE>
7
<PAGE> 8
CRYENCO SCIENCES, INC.
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 1997
(Unaudited, except information for the fiscal year ended August 31, 1996)
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three and nine months ended May 31,
1997 are not necessarily indicative of the results that may be expected for the
year ending August 31, 1997. For further information, refer to the consolidated
financial statements and footnotes thereto included in Company's Annual Report
on Form 10-K for the year ended August 31, 1996.
2. INVENTORIES
Inventories (in thousands) consisted of the following:
<TABLE>
<CAPTION>
August 31, May 31,
1996 1997
------- -------
<S> <C> <C>
Raw Materials $ 3,344 $ 3,997
Finished goods and work-in-process 1,139 1,683
------- -------
4,483 5,680
Less reserve for obsolescence (150) (122)
------- -------
$ 4,333 $ 5,558
======= =======
</TABLE>
8
<PAGE> 9
3. LONG-TERM DEBT
Long-term debt (in thousands) at May 31, 1997 is comprised of the following:
Term loan maturing December 31, 1998 bearing interest
at the reference rate (as defined in the loan agreement)
plus 3/4% (9.25% May 31, 1997) payable monthly.
Principal payments of $12,806 are payable monthly. $ 499
Revolving credit facility maturing December 31, 1998
bearing interest at the reference rate (as defined in the loan
agreement) plus up to an additional 1.0% depending upon
financial performance (9.0% at May 31, 1997). 6,363
Other 396
------
7,258
Less current portion (294)
------
$6,964
======
On April 10, 1997 the Company prepaid the outstanding balance ($1,150,000) of
the note payable to the CIT Group/Equity Investments, Inc. ("CIT").
The Company must comply with certain financial covenants in connection with its
long-term debt, including the maintenance of certain financial ratios and
restrictions on dividends.
9
<PAGE> 10
4. EXTRAORDINARY ITEM - EARLY EXTINGUISHMENT OF DEBT
As a result of the early retirement of the Chemical Bank debt and the partial
payment on the CIT note, the Company recognized an extraordinary expense of
$93,000 (net of the related tax benefit of $54,000) for the write down of
deferred financing expenses related to these debts during the three months ended
February 29, 1996.
5. EARNINGS PER SHARE
Net earnings per share is computed using the weighted average number of shares
of common stock outstanding for the period. When dilutive, stock options and
warrants are included as share equivalents using the treasury stock method. In
calculating net earnings per share, preferred dividends of $24,718 and $71,746
reduced the net earnings available to common stockholders for the three months
and nine months ended May 31, 1997, respectively. Fully diluted net earnings per
common share is not significantly different from primary net earnings per common
share.
6. RECENT DEVELOPMENTS
On April 30, 1997, the Company entered into an Agreement and Plan of Merger
(the "Merger Agreement") with Chart Industries, Inc. ("Chart") and certain of
Chart's wholly-owned subsidiaries pursuant to which the Company will become an
indirect, wholly-owned subsidiary of Chart (the "Merger"). As a result of the
Merger, each outstanding share of common stock of the Company will be converted
into the right to receive $2.75 in cash, without interest. The Merger Agreement
and the Merger are subject to approval by the stockholders of the Company. A
Special Meeting of the Company's stockholders is scheduled for July 31, 1997 in
order to vote upon approval and adoption of the Merger Agreement and the
transactions contemplated thereby.
10
<PAGE> 11
REPORT OF INDEPENDENT AUDITORS
The Board of Directors and Stockholders
Cryenco Sciences, Inc.
We have audited the accompanying consolidated balance sheets of Cryenco
Sciences, Inc. as of August 31, 1996 and 1995, and the related consolidated
statements of operations, stockholders' equity, and cash flows for each of the
three years in the period ended August 31, 1996. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Cryenco Sciences,
Inc. at August 31, 1996 and 1995, and the consolidated results of their
operations and their cash flows for each of the three years in the period ended
August 31, 1996, in conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
Denver, Colorado
October 5, 1996
11
<PAGE> 12
CRYENCO SCIENCES, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AMOUNTS)
<TABLE>
<CAPTION>
AUGUST 31,
1996 1995
---------------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 111 $ 632
Accounts receivable, trade, net of
allowance of $12 in 1996 and $14 in 1995 5,352 2,738
Accounts receivable, affiliate 1,423 83
Costs and estimated earnings in excess of
billings on uncompleted contracts 3,944 6,707
Inventories (Note 2) 4,333 4,208
Prepaid expenses 57 116
---------------------
Total current assets 15,220 14,484
Property and equipment:
Leasehold improvements 739 684
Machinery and equipment 5,355 3,979
Office furniture and equipment 1,231 402
---------------------
7,325 5,065
Less accumulated depreciation 3,099 2,249
---------------------
4,226 2,816
Property on operating leases, net of
accumulated depreciation of $7 604 -
Deferred financing costs, net of accumulated
amortization of $177 in 1996 and $738 in
1995 120 256
Organizational costs, net of accumulated
amortization of $507 in 1996 and $404 in
1995 - 103
Goodwill, net of accumulated amortization of
$738 in 1996 and $589 in 1995 5,226 5,375
Other assets 308 343
---------------------
TOTAL ASSETS $25,704 $23,377
=====================
</TABLE>
12
<PAGE> 13
<TABLE>
<CAPTION>
AUGUST 31,
1996 1995
--------------------------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,224 $ 3,469
Accrued expenses 1,123 880
Accrued management fees 324 324
Current portion of long-term debt and
capital lease obligations 1,382 1,593
Income tax payable 344 246
--------------------------
Total current liabilities 5,397 6,512
Long-term debt and capital lease obligations,
less current portion 8,634 5,629
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value, authorized
shares - 2,000,000, preferences, limitations
and relative rights to be established by the
Board of Directors:
Series A, nonvoting, authorized shares -
150,000
Issued and outstanding shares -
67,838 (aggregate liquidation preference
of $678,380) 1 1
Common stock, $.01 par value:
Class A, voting, authorized shares -
21,500,000
Issued and outstanding shares -
6,996,997 at August 31, 1996 and
6,842,828 at August 31, 1995 70 68
Class B, nonvoting, authorized shares -
1,500,000
Issued and outstanding shares - none - -
Additional paid-in capital 14,020 14,022
Warrants 169 169
Retained earnings (deficit) (2,587) (3,024)
--------------------------
Total stockholders' equity 11,673 11,236
--------------------------
Total liabilities and stockholders' equity $ 25,704 $ 23,377
==========================
</TABLE>
13
<PAGE> 14
CRYENCO SCIENCES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
YEAR ENDED AUGUST 31
--------------------
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Contract revenue $ 31,259 $ 27,215 $ 17,665
Cost of revenue 24,898 22,350 14,670
----------- ----------- -----------
Gross profit 6,361 4,865 2,995
Selling, general and administrative expenses 3,288 2,867 2,834
Research and development expenses 792 70 86
Amortization expense 346 346 338
----------- ----------- -----------
Operating income (loss) 1,935 1,582 (263)
Other (income) expense:
Interest income (1) (20) (103)
Interest expense 944 1,007 1,208
Other nonoperating (income) expense, net 9 40 (69)
----------- ----------- -----------
Income (loss) from operations before
income taxes and extraordinary item 983 555 (1,299)
Income tax expense (benefit) 363 194 (403)
----------- ----------- -----------
Income (loss) from operations before
extraordinary item 620 361 (896)
Extraordinary item (net of income tax
benefit of $54) 93 - -
----------- ----------- -----------
Net income (loss) $ 527 $ 361 $ (896)
=========== =========== ===========
Earnings (loss) per common share and
common share equivalent:
Income (loss) from operations before
extraordinary item $ .07 $ .04 $ (.17)
Extraordinary item (.01) - -
----------- ----------- -----------
Net income (loss) $ .06 $ .04 $ (.17)
=========== =========== ===========
Weighted average number of shares
outstanding during year 7,230,773 6,620,055 5,346,760
=========== =========== ===========
</TABLE>
See accompanying notes.
14
<PAGE> 15
CRYENCO SCIENCES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
PREFERRED COMMON
STOCK STOCK ADDITIONAL RETAINED
----- ----- PAID-IN EARNINGS
SHARES AMOUNT SHARES AMOUNT CAPITAL WARRANTS (DEFICIT) TOTAL
------ ------ ------ ------ ------- -------- --------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at August 31, 1993 - $- 5,326,936 $53 $9,469 $55 $(2,386) $7,191
Issuance of warrants - - - - - 94 - 94
Issuance of preferred
stock 67,838 1 - - 678 - - 679
Issuance of common
stock in exchange for
warrants exercised - - 56,974 1 (1) - - -
Cash dividends paid on
preferred stock ($.32
per share) - - - - - - (21) (21)
Net loss - - - - - - (896) (896)
--------------------------------------------------------------------------------------------
Balance at August 31, 1994 67,838 1 5,383,910 54 10,146 149 (3,303) 7,047
Sale of common stock - - 800,000 8 2,223 - - 2,231
Issuance of warrants - - - - - 74 - 74
Issuance of common
stock in exchange for
warrants exercised - - 658,918 6 1,653 (54) - 1,605
Cash dividends paid on
preferred stock ($1.22
per share) - - - - - - (82) (82)
Net income - - - - - - 361 361
--------------------------------------------------------------------------------------------
Balance at August 31, 1995 67,838 1 6,842,828 68 14,022 169 (3,024) 11,236
Issuance of common
stock in exchange for
warrants exercised - - 154,169 2 (2) - - -
Dividends on preferred
stock ($1.32 per share) - - - - - - (90) (90)
Net income - - - - - - 527 527
--------------------------------------------------------------------------------------------
Balance at August 31, 1996 67,838 $1 6,996,997 $ 70 $ 14,020 $ 169 $(2,587) $ 11,673
====== == ========== ====== ======== ======= ======= ========
</TABLE>
See accompanying notes.
15
<PAGE> 16
CRYENCO SCIENCES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR ENDED AUGUST 31
--------------------
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $ 527 $ 361 $ (896)
Adjustments to reconcile net income (loss)
to net cash provided (used) by
operating activities:
Depreciation 857 684 571
Amortization 436 346 338
Deferred taxes 26 - -
Write-down of deferred financing costs 147 - -
Changes in operating assets and liabilities:
Accounts receivable (3,954) (48) 525
Costs and estimated earnings in excess of
billings on uncompleted contracts 2,763 (3,191) (293)
Inventories (125) (1,562) (114)
Income tax payable 72 596 863
Prepaid expenses and other assets (101) 14 228
Accounts payable (1,245) 2,107 217
Accrued expenses 220 (16) 87
Accrued management fees - 80 133
Customer deposits - (607) 285
-------- ------- -------
Net cash provided (used) by operating activities (377) (1,236) 1,944
INVESTING ACTIVITIES
Purchases of property and equipment (1,956) (1,402) (601)
Payments for operating lease property (611) - -
Proceeds from sale of property and equipment - 6 17
-------- ------- -------
Net cash used by investing activities (2,567) (1,396) (584)
FINANCING ACTIVITIES
Net proceeds from issuance of common stock - 3,892 -
Net proceeds from issuance of stock warrants - 72 60
Principal payments on long-term debt and capital
lease obligations (31,322) (1,343) (1,927)
Proceeds from long-term debt borrowings, net
of expenses 33,812 - -
Exercise of common stock options and warrants - (54) -
Dividends paid on preferred stock (67) (82) (21)
-------- ------- -------
Net cash provided (used) by financing activities 2,423 2,485 (1,888)
-------- ------- -------
</TABLE>
16
<PAGE> 17
CRYENCO SCIENCES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR ENDED AUGUST 31
--------------------
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Net decrease in cash and cash equivalents $(521) $(147) $ (528)
Cash and cash equivalents at beginning of year 632 779 1,307
----- ----- -------
Cash and cash equivalents at end of year $ 111 $ 632 $ 779
===== ===== =======
Supplemental disclosures of cash flow information:
Cash paid for income taxes $ 247 $ - $ -
Cash paid for interest 787 875 1,267
Supplemental disclosures of noncash financing
activities:
Equipment acquired and financed under capital
leases 304 317 87
Retirement of debt in exchange for issuance of
Series A preferred stock - - 678
Issuance of common stock in exchange for
warrants exercised 2 2 1
Issuance of warrants as part of debt
restructurings - - 35
</TABLE>
See accompanying notes.
17
<PAGE> 18
CRYENCO SCIENCES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AUGUST 31, 1996
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
DESCRIPTION OF THE BUSINESS
Cryenco Sciences, Inc. (the Company) designs and manufactures controlled
atmospheric enclosures and products to transport, store and dispense cryogenic
materials.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of Cryenco Sciences,
Inc. and its wholly owned subsidiaries. All significant intercompany balances
and transactions have been eliminated.
INCOME TAXES
Deferred tax liabilities or assets (net of a valuation allowance) are provided
in the financial statements by applying the provisions of applicable tax laws to
measure the deferred tax consequences of temporary differences that will result
in net taxable or deductible amounts in future years as a result of events
recognized in the financial statements in the current or preceding years.
CASH AND CASH EQUIVALENTS
For purposes of the consolidated statements of cash flows, the Company considers
all highly liquid investments with original maturities of three months or less
to be cash equivalents.
CONTRACT REVENUE AND COST RECOGNITION
Revenue and costs on long-term contracts (contracts with a value in excess of
$100,000 and requiring more than six months to complete) are recognized using
the percentage-of-completion method (measured by the percentage of costs
incurred to date to total estimated costs for each contract) or units delivered,
whichever is deemed more appropriate for the contract.
Revenue and costs on short-term contracts (contracts with a value less than
$100,000 and requiring six months or less to complete) are recognized using the
completed contract method, which results in the deferral of revenue and costs
until such time as the contracts are complete. A contract is considered complete
when all costs, except insignificant items, have been incurred and the units
have been delivered to the customer.
Contract costs include all direct material and labor costs and those indirect
costs related to contract performance such as indirect labor, building and
equipment rental, supplies, freight and depreciation costs. Selling, general and
administrative costs are charged to expense as incurred. Provisions for
estimated losses on uncompleted contracts are made in the period such losses are
determined.
INVENTORIES
Inventories are stated at the lower of cost (first-in, first-out) or market. The
Company records an allowance for excess and obsolete inventory based on periodic
reviews.
18
<PAGE> 19
PROPERTY AND EQUIPMENT
Property and equipment are recorded at cost. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets.
DEFERRED FINANCING COSTS
Deferred financing costs are amortized using the straight-line method over the
term of the related indebtedness.
ORGANIZATIONAL COSTS
Organizational costs are amortized using the straight-line method over five
years.
GOODWILL
Goodwill is being amortized using the straight-line method over forty years. The
Company periodically evaluates goodwill impairment on the basis of whether the
goodwill is fully recoverable from projected, undiscounted operating cash flows.
RESEARCH AND DEVELOPMENT
Research and development expenses are typically charged to expense as incurred
or are charged against a specific contract, if to be reimbursed by the customer.
In May 1995, the Company entered into an arrangement with a corporation under
which the corporation would provide $452,500 to the Company for the development,
demonstration, delivery, and installation of an on-site Thermo-Acoustic Driven
Orifice Pulse Tube Refrigerator (TADOPTR) liquefier and LNG dispensing system.
The period of performance under the arrangement was over twelve months. For the
year ended August 31, 1995, the Company incurred approximately $255,000 in costs
for development for which it was fully reimbursed. For the year ended August 31,
1996, the Company incurred approximately $504,000 in costs for development and
received $120,000 of reimbursement.
WARRANTIES
The Company records a warranty accrual at the time of sale for estimated claims,
based on actual claims experience. The warranty for the Company's products
generally is for defects in material and workmanship for a period of twelve
months.
EARNINGS (LOSS) PER COMMON SHARE
Net earnings (loss) per common share is computed using the weighted average
number of shares of common stock outstanding. When dilutive, stock options and
warrants are included as share equivalents using the treasury stock method. In
calculating net earnings (loss) per share, preferred dividends of $89,661 and
$82,538 decreased the net earnings during 1996 and 1995, respectively. Preferred
dividends of $21,150 increased the net loss during 1994. Fully diluted net
earnings (loss) per common share is not significantly different from primary net
earnings (loss) per common share.
CONCENTRATIONS OF CREDIT RISK AND MAJOR CUSTOMERS
During the fiscal years ended August 31, 1996, 1995 and 1994, revenue from one
customer, General Electric, was approximately $11,067,000 (35% of revenue),
$9,702,000 (36% of revenue), and $8,888,000 (50% of revenue), respectively. This
customer also represented $1,140,000 (21%) and $659,000 (24%) of accounts
receivable at August 31, 1996 and 1995, respectively, and $2,775,000 (70%) and
$2,734,000 (40%) of costs and estimated earnings in excess of billings on
uncompleted contracts at August 31, 1996 and 1995, respectively.
19
<PAGE> 20
Revenue from Jack B. Kelley, Inc. and affiliates totaled approximately
$9,566,000 (31% of revenue) in 1996, $9,854,000 (36% of revenue) in 1995 and
$2,545,000 (14% of revenue) in 1994. Jack B. Kelley, Inc. and affiliates also
represent $1,835,000 (34%) and $821,000 (30%) of accounts receivable and
$435,000 (11%) and $2,182,000 (32%) of costs and estimated earnings in excess of
billings on uncompleted contracts at August 31, 1996 and 1995, respectively.
Revenue from Air Products totaled approximately $4,024,000 (13% of revenue) in
1996. Air Products also represents $408,000 (8%) of accounts receivable and
$960,000 (24%) of costs and estimated earnings in excess of billings on
uncompleted contracts as of August 31, 1996.
The Company performs periodic credit evaluations of its customers' financial
condition and generally does not require collateral. Receivables are generally
due within 30 days. Credit losses consistently have not been significant.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and disclosures made in
the accompanying notes to the financial statements. Actual results could differ
from those estimates.
FAIR VALUES OF FINANCIAL INSTRUMENTS
The carrying values of the Company's financial assets approximate fair value.
The fair values of debt are estimated using discounted cash flow analyses with
discount rates equal to the interest rates currently being offered for loans
with similar terms to borrowers of similar credit quality. While the Company
believes the carrying value of its note payable generally approximates fair
value, a reasonable estimate of the fair market value could not be made without
incurring excessive costs.
STOCK BASED COMPENSATION
In October 1995, the Financial Accounting Standards Board (FASB) issued
Statement No. 123, Accounting for Stock-Based Compensation. Statement No. 123 is
applicable for fiscal years beginning after December 15, 1995 and gives the
option to either follow fair value accounting or to follow Accounting Principles
Board Opinion No. 25, Accounting for Stock Issued to Employees (APB No. 25), and
related interpretations.
The Company has determined it will follow APB No. 25 and related interpretations
in accounting for its employee stock options. The Company has not yet determined
the impact on its financial position or results of operations had fair value
accounting been adopted.
LONG-LIVED ASSETS
In March 1995, the FASB issued Statement No. 121, Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be Disposed Of, which requires
impairment losses to be recorded on long-lived assets used in operations when
indicators of impairment are present. The Company is required to adopt Statement
No. 121 in the first quarter of fiscal year 1997 and, based on current
circumstances, does not believe the effect of adoption will be material.
20
<PAGE> 21
2. INVENTORIES
At August 31, inventories consist of:
<TABLE>
<CAPTION>
1996 1995
---- ----
(IN THOUSANDS)
<S> <C> <C>
Raw materials $3,344 $3,514
Finished goods and work-in-process 1,139 794
----- ---
4,483 4,308
Less reserve for obsolescence 150 100
--- ---
$4,333 $4,208
====== ======
</TABLE>
3. COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS ON UNCOMPLETED CONTRACTS
At August 31, costs and estimated earnings in excess of billings on uncompleted
contracts consist of:
<TABLE>
<CAPTION>
1996 1995
---- ----
(IN THOUSANDS)
<S> <C> <C>
Costs on uncompleted contracts $5,436 $8,776
Estimated gross profit to date 2,203 2,616
------ ------
Estimated revenue 7,639 11,392
Less billings to date 3,695 4,685
------ ------
$3,944 $6,707
====== ======
</TABLE>
4. LONG-TERM DEBT
Long-term debt is comprised of the following:
<TABLE>
<CAPTION>
AUGUST 31,
1996 1995
---- ----
(IN THOUSANDS)
<S> <C> <C>
Note payable bearing interest at 14%, subordinated,
unsecured. Interest is payable quarterly and
principal payments of $275,000 are payable
quarterly beginning November 30, 1996. $1,700 $2,200
Term loan maturing December 31, 1998 bearing interest
at the reference rate (as defined in the loan agreement)
plus 3/4% (9.0% at August 31, 1996) payable monthly.
Principal payments of $12,806 are payable monthly
beginning September 15, 1996. 615 -
Term loan bearing interest at the adjusted LIBO rate
plus 3 1/2%. - 2,500
Revolving credit facility. Interest payable at the
adjusted LIBO-rate plus 3 1/2%. - 2,200
</TABLE>
21
<PAGE> 22
<TABLE>
<CAPTION>
AUGUST 31,
-----------------------
1996 1995
---- ----
(IN THOUSANDS)
<S> <C> <C>
Revolving credit facility maturing December 31, 1998
bearing interest at the reference rate (as defined in the
loan agreement) plus up to an additional 1.0%
depending upon financial performance (9.25% at
August 31, 1996 $ 7,210 $ -
Capital lease Obligations 491 322
------- ------
10,016 7,222
Less current portion 1,382 1,593
------- ------
$ 8,634 $5,629
======= ======
</TABLE>
In December 1995, the Company entered into a Credit and Security Agreement (the
Agreement) with FBS Business Finance Corporation (FBS). Under the Agreement, FBS
has provided a revolving loan facility of up to $9,000,000 through December 31,
1997, increasing to $10,000,000 through December 31, 1998, subject to the amount
of the Company's borrowing base, and a term loan facility of up to $2,960,000,
subject to eligible manufacturing additions for the year ended August 31, 1996.
On January 16, 1996, the Company obtained the initial funding under the
revolving loan in the amount of $5,825,000. The proceeds of this loan were used
to retire the outstanding revolving credit facility ($2,200,000), to retire the
outstanding term loan ($2,125,000), to make a partial payment on the outstanding
note payable ($500,000) and for general corporate purposes ($1,000,000). As a
result of the early retirement of the term loan, the revolving credit facility,
and the partial payment on the note payable, the Company recognized an
extraordinary expense of $93,000 (net of the related tax benefit of $54,000) for
the write-down of deferred financing expenses related to these debts.
The term loan and revolving credit facility are secured by the common stock of
Cryenco, Inc. and all accounts receivable, inventories, property and equipment
and intangible assets of the Company.
The Company must comply with certain debt covenants, including the maintenance
of certain financial ratios and restrictions on dividends.
The aggregate maturities of long-term debt are as follows (in thousands):
YEAR ENDING AUGUST 31:
1997 $1,382
1998 899
1999 7,648
2000 74
2001 13
-------
$10,016
=======
5. LEASES
Office space, production facilities, and certain equipment are leased under
agreements which are classified as operating leases for financial reporting
purposes. The facilities leases provide for renewal options of up to five and
ten years at approximately the same rates. Total rental expense charged to
operations for the years ended August 31, 1996, 1995 and 1994 was $784,000,
$853,000 and $828,000, respectively.
22
<PAGE> 23
The Company's assets held under capital leases, which are included in property
and equipment, consist of the following at August 31:
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Machinery and equipment $628,003 $418,039
Less accumulated depreciation 110,481 52,824
-------- --------
$517,522 $365,215
======== ========
</TABLE>
Future minimum lease payments under capital and noncancelable operating leases
are as follows (in thousands):
<TABLE>
<CAPTION>
CAPITAL OPERATING
LEASES LEASES
------ ------
YEAR ENDING AUGUST 31:
<S> <C> <C>
1997 $180 $ 860
1998 180 360
1999 155 359
2000 80 42
2001 20 13
---- ------
Total minimum lease payments 615 $1,634
======
Less interest 124
----
Present value of minimum lease payments $491
====
</TABLE>
Depreciation expense relating to assets held under capital leases for the years
ended August 31, 1996, 1995 and 1994 was $98,323, $36,023 and $16,801,
respectively.
Subsequent to August 31, 1996, the property located at 3811 Joliet Street,
Denver, Colorado, was sold and a new lease agreement between the Company and the
new owners became effective. Under the terms of the lease, the Company is
obligated to pay a minimum rent of $38,841 per month for 10 years (subject to
increases based on an inflation index), property taxes and insurance. This lease
replaces the Company's lease with the prior owners which had one year remaining
with rent of $41,666 per month, and is not included in the future minimum lease
payments shown above.
6. EQUIPMENT LEASING
During the year ended August 31, 1996, the Company entered into lease agreements
under which equipment manufactured by the Company is leased to customers. These
leases have been classified as operating leases by the Company.
Future minimum lease payments under noncancelable operating leases are as
follows (in thousands):
YEAR ENDING AUGUST 31:
1997 $ 81
1998 74
----
$155
====
23
<PAGE> 24
7. COMMON STOCK, PREFERRED STOCK, WARRANTS, AND OPTIONS
In connection with a term loan and subordinated note payable, the Company issued
warrants to purchase 197,456 shares of its Class A common stock and 543,372
shares of its Class B common stock for $.86112 per share (the original
warrants). At April 15, 1992, the Company issued warrants to purchase a total of
38,323 additional shares of Class B common stock at $5 per share (the new
warrants) to the holders of the original Class A and Class B warrants in
exchange for the removal of a feature of the original warrants whereby the
holders had the option to require the Company to purchase the warrants or the
stock issued pursuant to the warrants. During 1995, the Company increased the
number of original warrants to purchase an additional 1,443 shares of its Class
A common stock and 16,854 shares of its Class B common stock and reduced the
exercise price to $.8352 per share as a result of antidilutive provisions which
were invoked when the Company issued the shares of common stock described below.
In addition, the new warrants were increased to purchase an additional 1,189
shares of Class A common stock and the exercise price was reduced to $4.8496 per
share. The holders of the original warrants, as amended, and the new warrants
have a "cashless exercise right," whereby the holders may reduce the number of
shares to be received to pay the exercise price, such reduction to be equal to
the exercise price to be paid divided by the then fair market value per share.
These warrants expire August 29, 2003. During the years ended August 31, 1996,
1995 and 1994, warrants for 191,766, 150,000 and 75,925 shares, respectively,
were exercised, using the cashless exercise option, which resulted in the
issuance of 154,169, 118,918 and 56,974 shares, respectively, of Class A common
stock.
In 1992, 130,000 outstanding options and warrants to acquire shares of Gulf &
Mississippi Corporation, which had acquired the Company in a reverse
acquisition, were converted into options and warrants to purchase the same
number of shares of Class A common stock of the Company. Warrants to purchase
100,000 shares of the Company's Class A common stock at $3.6956 per share
expired July 9, 1995 and options to purchase 30,000 shares of the Company's
Class A common stock at $16 per share are exercisable prior to November 5, 1996.
The options were issued pursuant to the Company's 1986 Non-Qualified Stock
Option Plan, which provides for an aggregate of 50,000 shares of common stock to
be issued under the Plan.
In connection with the 1992 public offering, the Company sold a warrant to
purchase 10,000 shares of Class A common stock at $5.50 per share for $100 to
one of the underwriters. The warrant is exercisable for a period of five years
commencing August 13, 1993.
In March 1993, in conjunction with a debt restructuring, the Company was
advanced $650,000 from stockholders, treated as junior subordinated notes. In
consideration for the advances, these stockholders received warrants to purchase
130,000 shares of Class A common stock at $7.90 per share. The warrants are
exercisable for a period of five years commencing March 12, 1993. The warrants'
fair value of $55,000 at time of issuance, as determined by an independent
appraiser, was capitalized as a deferred expense and is being amortized to
expense over five years.
24
<PAGE> 25
In November 1993, the Company amended certain of its debt agreements with
respect to certain covenants. Under the terms of these amendments, the Company
issued warrants to purchase 35,000 shares of the Company's Class B common stock
and warrants to purchase 17,500 shares of the Company's Class A common stock.
The warrants were exercisable at a price of $6.38 per share and expire on August
29, 2003. The warrants' fair value at time of issuance, as determined by the
Company, was $22,000. During 1995, the Company increased the number of warrants
to purchase an additional 1,086 shares of its Class B common stock and 542
shares of its Class A common stock and reduced the exercise price to $6.19 per
share as a result of antidilutive provisions which were invoked when the Company
issued the shares of common stock described below.
During the year ended August 31, 1994, the Company exchanged 67,838 shares of
its Series A Preferred Stock for the junior subordinated notes and related
current interest notes totaling approximately $678,000. The Series A Preferred
Stock provides for a cumulative cash dividend of 12% of the aggregate
liquidation value, as defined, per annum through August 31, 1995, increasing 1%
per annum thereafter to a maximum of 18%. However, all dividends in excess of
12% per annum shall not be paid in cash, but shall be paid by issuing additional
shares of Series A Preferred Stock. The Series A Preferred Stock shall be
redeemable, in whole or in part, at the option of the Company by resolution of
its Board of Directors, at any time and from time to time, at the liquidation
value of such shares, plus all dividends payable on such shares up to the date
fixed for redemption. In consideration for the exchange, the Company issued
warrants to purchase up to 65,000 shares of the Company's Class A common stock,
at an exercise price of $3.55 per share. The warrants expire January 29, 2000.
The warrants' fair value of $13,000 at time of issuance, as determined by an
independent appraiser, was capitalized as a deferred expense and is being
amortized to expense over five years.
As described in Note 10, in June 1994, the Company received $780,000 from a
limited partnership to fund the development of a 500 gallon per day TADOPTR. The
partnership received warrants as a part of the transaction to purchase 200,000
shares of Class A common stock at $3.00 per share. The warrants expire March 20,
2000. The warrants' fair value, as determined by an independent appraiser, was
$60,000 at the time of issuance.
On November 29, 1994, the Company entered into a Purchase Agreement with a group
of purchasers which provided for the sale of 800,000 shares of Class A common
stock and warrants to purchase 700,000 shares of Class A common stock in the
future at an exercise price of $4.00 per share. The aggregate purchase price for
the shares and warrants was approximately $2,700,000. The purchase was completed
in two closings, on December 20, 1994 and January 30, 1995, from which the
Company realized net proceeds of approximately $2,300,000. Warrants for 507,503
and 192,497 shares are exercisable for a period of five years commencing
December 20, 1994 and January 30, 1995, respectively. The warrants' fair value,
as determined by the Company, was $70,000 at the time of issuance.
On May 18, 1995, the Company agreed, among other things, to reduce the exercise
price of the warrants referred to in the preceding paragraph to $3.00 per share
and the purchasers agreed to exercise a portion of the warrants. On June 8,
1995, the purchasers exercised warrants to purchase 539,900 shares of Class A
common stock, from which the Company realized net proceeds of approximately
$1,600,000.
In connection with the aforementioned Purchase Agreement, the Company also
issued warrants to purchase 25,000 shares of Class A common stock at an exercise
price of $4.00 per share. The warrants expire December 20, 1999. The warrants'
fair value, as determined by the Company, was $2,500 at the time of issuance.
The Company's 1992 Employee Incentive and Non-Qualified Stock Option Plan (the
1992 Plan) was adopted effective April 1, 1992. The 1992 Plan provides for up to
187,500 shares of the Company's Class A common stock pursuant to the exercise of
stock options which may be granted to employees and directors. Options may be
issued at not less than the fair market value on the date of grant.
25
<PAGE> 26
Information for each of the three years in the period ended August 31, 1996,
with respect to activity of the 1992 Plan, is as follows:
<TABLE>
<CAPTION>
NUMBER OF EXERCISE
OPTIONS PRICE
--------- ---------
<S> <C> <C>
Options outstanding at August 31, 1993 26,000 $4.00-6.75
Granted in 1994 19,500 $3.00-6.38
-------
Options outstanding at August 31, 1994 45,500 $3.00-6.75
Granted in 1995 58,000 $ 5.38
Forfeited in 1995 (17,500) $4.00-6.38
-------
Options outstanding at August 31, 1995 86,000 $3.00-6.75
Granted in 1996 96,500 $ 4.50
Forfeited in 1996 (52,000) $4.50-6.38
-------
Options outstanding at August 31, 1996 130,500 $3.00-6.75
-------
</TABLE>
The Company's 1995 Incentive and Non-Qualified Stock Option Plan (the 1995 Plan)
was adopted effective November 16, 1995. The 1995 Plan provides for up to
300,000 shares of the Company's Class A common stock pursuant to the exercise of
stock options which may be granted to employees and directors. Options may be
issued at not less than the fair market value on the date of grant. No options
have been granted under the 1995 Plan at August 31, 1996.
The Company adopted the 1993 Non-Employee Director Stock Option Program (the
Program) effective September 1, 1993, whereby each director who is not an
officer or employee of the Company is entitled to receive options to purchase
500 shares of the Company's Class A common stock for each fiscal quarter served
as a director, commencing with the quarter ending November 30,1993. Eligible
directors are limited to a total of 20,000 shares under the Program. The
purchase price is determined based on the fair market value of outstanding
shares as of the last business day of the applicable fiscal quarter (the Award
Date). Options are exercisable for a period of ten years subsequent to the Award
Date. In connection with the Program, the Company has reserved 40,000 authorized
and unissued shares of Class A common stock for issuance and delivery upon
exercise of the options.
Information for each of the three years in the period ended August 31, 1996,
with respect to activity of the Program is as follows:
<TABLE>
<CAPTION>
NUMBER OF EXERCISE
OPTIONS PRICE
------- -----
<S> <C> <C>
Options outstanding at August 31, 1993 -
Granted in 1994 3,000 $2.50 - 6.13
------
Options outstanding at August 31, 1994 3,000 $2.50 - 6.13
Granted in 1995 4,000 $3.75 - 4.25
------
Options outstanding at August 31, 1995 7,000 $2.50 - 6.13
Granted in 1996 4,000 $3.50 - 4.75
------
Options outstanding at August 31, 1996 11,000 $2.50 - 6.13
======
</TABLE>
26
<PAGE> 27
8. INCOME TAXES
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. Significant components of
the Company's deferred tax liabilities and assets at August 31 are as follows:
<TABLE>
<CAPTION>
1996 1995
---- ----
(IN THOUSANDS)
<S> <C> <C>
Deferred tax liabilities:
Prepaid expenses $ 9 $ 35
Deferred tax assets:
Inventory obsolescence 56 37
Warranty 52 75
Inventory capitalization 23 25
Accrued liabilities 64 50
Tax basis of assets in excess of book basis 35 87
Other 4 6
----- ----
Total deferred tax assets 234 280
Valuation allowance for deferred tax assets (225) (245)
----- ----
Net deferred tax assets 9 35
----- ----
$ - $ -
===== ====
</TABLE>
Components of income tax expense (benefit) are as follows:
<TABLE>
<CAPTION>
CURRENT DEFERRED TOTAL
------- -------- -----
(IN THOUSANDS)
<S> <C> <C> <C>
1996
Federal $ 389 $(26) $ 363
State - - -
----- ---- -----
$ 389 $(26) $ 363
===== ==== =====
1995
Federal $ 194 $ - $ 194
State - - -
----- ---- -----
$ 194 $ - $ 194
===== ==== =====
1994
Federal $(403) $ - $(403)
State - - -
----- ---- -----
$(403) $ - $(403)
===== ==== =====
</TABLE>
A reconciliation between the actual income tax expense (benefit) and income
taxes computed by applying the statutory tax rates is as follows:
<TABLE>
<CAPTION>
1996 1995 1994
---- ---- ----
(IN THOUSANDS)
<S> <C> <C> <C>
Computed "expected" tax expense (benefit) $334 $189 $(442)
Goodwill and other permanent differences 99 86 -
Other (70) (81) 39
---- ---- -----
Actual tax expense (benefit) $363 $194 $(403)
==== ==== =====
</TABLE>
The Company has net operating loss carryforwards for state income tax purposes
of approximately $2,668,000 which expire in various amounts from 2008 to 2009.
Net operating loss carryforwards of approximately $1,048,000 and $977,000 are
used for state income tax purposes in 1996 and 1995, respectively.
27
<PAGE> 28
9. EMPLOYEE BENEFIT PLAN
The Company's 401(k) savings plan provides for both employee and employer
contributions. Employees who have reached the age of 21 years and who have
completed one year of service are eligible to participate in the Plan. Employees
may contribute up to 15% of their annual compensation limited to the maximum
contribution allowable under Internal Revenue Service guidelines. The employer
matches 25% of each employee's contribution, up to $1,000. Employee
contributions vest immediately, while amounts contributed by the employer vest
based upon the employee's term of service. Contributions for the years ended
August 31, 1996, 1995 and 1994 were $68,000, $52,000 and $41,000, respectively.
10. RELATED PARTY TRANSACTIONS
In June 1994, the Company entered into an arrangement with a limited partnership
in which the partnership would contribute $780,000 to the Company for the
development of a 500 gallon per day TADOPTR. A director of the Company is a
general partner of the limited partnership. In exchange for this funding, the
Company issued warrants to purchase 200,000 shares of Class A common stock at
$3.00 per share, and entered into a Royalty Rights and Technology Development
Agreement with the partnership pursuant to which royalties of between 1% and 5%
of net revenues from the sale of TADOPTRs will be paid to the partnership until
the partnership receives an aggregate of $1,600,000, after which the royalties
decrease to between 0.6% and 0.75% of net revenues. The royalties are payable
for a period of 20 years from the execution of the agreement. In addition, the
partnership was given a security interest in the Company's rights in the TADOPTR
to secure the royalty payments. The Company was obligated to spend funds
provided by the partnership for the development of a 500 gallon per day TADOPTR
over a period of 12 to 18 months. For the years ended August 31, 1996 and 1995,
the Company incurred approximately $455,000 and $325,000, respectively, in costs
for this development, for which it has been fully reimbursed under this
agreement.
In fiscal year 1992, the Company entered into an agreement with an affiliate of
several of the Company's principal stockholders pursuant to which such entity
provides a variety of management advisory services to the Company. The
agreement, which terminates on August 30, 1997, provides for monthly payments of
approximately $10,000 by the Company. At August 31, 1996 and 1995, the Company
has accrued management advisory fees of approximately $324,000 related to the
agreement.
In connection with the Purchase Agreement described in Note 7, the Company
issued warrants to purchase 700,000 and 25,000 shares of Class A common stock to
two entities within the purchaser group in which two directors of the Company
have a financial interest.
In June 1995, a limited liability company agreement was signed between Cryenex,
Inc. (Cryenex), a wholly owned subsidiary of the Company, and an affiliate of
Jack B. Kelley, Inc. for the establishment of a limited liability company,
Applied LNG Technologies USA, LLC (ALT), to develop turnkey projects utilizing
liquefied natural gas. Cryenex is a 49% owner of ALT, and accounts for its
investment using the equity method, under which Cryenex's share of income and
losses of ALT is reflected in income as earned and distributions will be
credited against the investment when received. As of August 31, 1995, Cryenex's
investment of $49,000 was reduced to zero. Under terms of the agreement, Cryenex
agreed to provide certain services to ALT, reimbursable to Cryenex, in an amount
up to $490,000. During the fiscal years ended August 31, 1996 and 1995, Cryenex
has provided services to ALT in the amount of $189,000 and $83,000,
respectively. In addition, during the fiscal year ended August 31, 1996, revenue
resulting from sales to ALT amounted to approximately $1,344,000. At August 31,
1996 and 1995, receivables from ALT represented $1,423,000 and $83,000,
respectively.
28
<PAGE> 29
11. FAIR VALUES OF FINANCIAL INSTRUMENTS
FASB No. 107, Disclosures about Fair Value of Financial Instruments, requires
the disclosure of the fair value of all financial instruments, both on and off
balance sheet, for which it is practicable to estimate their value. Financial
instruments are generally defined as cash, equity instruments or investments and
contractual obligations to pay or receive cash or another financial instrument.
In defining fair value, the Statement indicates quoted market prices are the
preferred means of estimating the value of a specific instrument, but in cases
where market quotes are not available, fair values should be determined using
various valuation techniques such as discounted cash flow calculations. Those
techniques are significantly affected by the assumptions used, including the
discount rate and estimates of future cash flows. In that regard, the derived
fair value estimates cannot be substantiated by comparison to independent
markets and, in many cases, could not be realized in immediate settlement of the
instrument. FASB No. 107 excludes certain financial instruments and all
nonfinancial instruments from its disclosure requirements. Accordingly, the
aggregate fair value amounts do not represent the underlying value of the
Company.
29
<PAGE> 30
B) PRO FORMA FINANCIAL INFORMATION
The accompanying Pro Forma Condensed Consolidated Financial Statements have been
prepared based upon certain assumptions and include adjustments as detailed in
the Notes to Pro Forma Condensed Consolidated Financial Statements. The
estimated fair market values reflected in the Pro Forma Condensed Consolidated
Financial Statements are based on preliminary estimates and assumptions and are
subject to revision as more information regarding asset and liability valuations
becomes available. In management's opinion, the preliminary allocation reflected
herein is not expected to be materially different from the final allocation.
The Pro Forma Condensed Consolidated Statements of Operations do not assume any
additional profitability resulting from the application of the Company's revenue
enhancement measures or cost reduction programs to the historical results of
Cryenco, nor do they assume increases in corporate general and administrative
expenses which may have resulted from the Company managing Cryenco for the
periods presented.
The accompanying Pro Forma Condensed Consolidated Financial Statements should be
read in conjunction with the Condensed Consolidated Financial Statements of the
Company and the related notes thereto as included in the Company's Form 10-Q as
of June 30, 1997. Such pro forma information is based on historical data with
respect to the Company and Cryenco. The pro forma information is not necessarily
indicative of the results that might have occurred had such transactions
actually taken place at the beginning of the period specified and is not
intended to be a projection of future results. The pro forma information
presented herein is provided to comply with the requirements of the Securities
and Exchange Commission. The pro forma information does not reflect any
adjustments to reflect the manner in which the acquired entity is being or will
be operated under the control of the Company.
CHART INDUSTRIES, INC.
<TABLE>
<CAPTION>
PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS PAGE
----
<S> <C>
Pro Forma Condensed Consolidated Balance Sheet
as of June 30, 1997 31
Pro Forma Condensed Consolidated Statement of Operations
for the six months ended June 30, and May 31, 1997 32
Pro Forma Condensed Consolidated Statement of Operations for
the twelve months ended December 31, and November 30, 1996 33
Notes to Pro Forma Condensed Consolidated Financial Statements 34-35
</TABLE>
30
<PAGE> 31
CHART INDUSTRIES, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
CHART CRYENCO PRO FORMA
ASSETS JUNE 30, 1997 MAY 31, 1997 ADJUSTMENTS TOTAL
------------------------------------------------------------------------------
<S> <C> <C> <C>
Current Assets
Cash and cash equivalents $ 41 $ 426 $ 467
Restricted cash 4,597 4,597
Accounts receivable 21,993 4,510 26,503
Inventories 19,984 5,558 25,542
Other current assets 5,478 2,766 8,244
------------------------------------------------------------------------------
Total Current Assets 52,093 13,260 65,353
Property, plant & equipment, net 20,864 3,784 24,648
Goodwill 1,649 5,114 $ 8,863 (2) 15,626
Other assets, net 675 306 981
------------------------------------------------------------------------------
TOTAL ASSETS $ 75,281 $ 22,464 $ 8,863 $ 106,608
==============================================================================
LIABILITIES & SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable 5,755 1,490 7,245
Customer advances 15,359 15,359
Billings in excess of contract revenue 2,325 2,325
Accrued expenses and other liabilities 13,641 1,754 150 (1) 15,545
Current portion of long-term debt 2,896 294 3,190
------------------------------------------------------------------------------
Total Current Liabilities 39,976 3,538 150 43,664
Long-term debt 4,238 6,964 20,239 (1) 31,441
Deferred income taxes 591 591
Shareholders' Equity
Common stock 102 71 (71) (4) 102
Additional paid-in capital 18,710 14,027 (14,027) (4) 18,710
Warrants 169 267 (3) 436
Retained earnings (deficit) 21,735 (2,305) 2,305 (4) 21,735
Treasury stock (10,071) (10,071)
------------------------------------------------------------------------------
30,476 11,962 (11,526) 30,912
------------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 75,281 $ 22,464 $ 8,863 $ 106,608
==============================================================================
</TABLE>
31
<PAGE> 32
CHART INDUSTRIES, INC AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, AND MAY 31, 1997
(In thousands, except per share data)
<TABLE>
<CAPTION>
CHART CRYENCO PRO FORMA
JUNE 30, 1997 MAY 31, 1997 ADJUSTMENTS TOTAL
----------------------------------------------------
<S> <C> <C> <C> <C>
Sales $ 84,198 $ 13,871 $ 98,069
Cost of products sold 58,556 11,454 70,010
----------------------------------------------------
Gross profit 25,642 2,417 28,059
Selling, general & administrative expenses 11,712 1,631 $ 111 (5) 13,454
----------------------------------------------------
Operating income 13,930 786 (111) 14,605
Interest (income) expense, net 18 450 860 (6) 1,328
----------------------------------------------------
Income before income taxes 13,912 336 (971) 13,277
Income taxes 4,730 124 (292)(7) 4,562
----------------------------------------------------
Net income $ 9,182 $ 212 $ (679) $ 8,715
====================================================
Net income per common share $ 0.62 N/A N/A $ 0.59
====================================================
Shares used in per share calculations 14,846 N/A N/A 14,846
</TABLE>
32
<PAGE> 33
CHART INDUSTRIES, INC. AND SUBSIDIARIES
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE TWELVE MONTHS ENDED DECEMBER 31, AND NOVEMBER 30, 1996
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
CHART CRYENCO
DECEMBER 31, NOVEMBER 30, PRO FORMA
1996 1996 ADJUSTMENTS TOTAL
------------------------------------------------------------------
<S> <C> <C> <C>
Sales $ 148,400 $ 30,648 $ 179,048
Cost of products sold 103,398 23,996 127,394
------------------------------------------------------------------
Gross profit 45,002 6,652 51,654
Selling, general & administrative expenses 21,745 4,556 $ 222 (5) 26,523
------------------------------------------------------------------
Operating income 23,257 2,096 (222) 25,131
Interest expense-net 623 980 1,720 (6) 3,323
------------------------------------------------------------------
Income before income taxes 22,634 1,116 (1,942) 21,808
Income taxes 7,605 413 (602) (7) 7,416
------------------------------------------------------------------
Net income $ 15,029 $ 703 $ (1,340) $ 14,392
==================================================================
Net income per common share $ 0.99 N/A N/A $ 0.95
=================================================================
Shares used in per share calculations 15,186 N/A N/A 15,186
</TABLE>
33
<PAGE> 34
CHART INDUSTRIES, INC.
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On July 31, 1997, the Company completed its acquisition of Cryenco from the
shareholders of Cryenco by means of a merger between Cryenco and Chart
Acquisition Company, Inc., a wholly-owned subsidiary of the Company. The
Merger was accomplished pursuant to the Merger Agreement. A copy of the
Merger Agreement is filed as an Exhibit hereto.
Cryenco manufactures vacuum-jacketed containment systems and related products
for the transportation, storage and dispensing of LNG, LCNG and liquefied
argon, oxygen and nitrogen. Cryenco's products include cryogenic transport
trailers, large cryogenic storage tanks, cryogenic intermodal containers,
LNG/LCNG fueling stations, fuel gas modules and cryostats for MRI and
low-temperature research.
Total consideration for the Merger consisted of the payment to the shareholders
of Cryenco of $19.7 million to purchase the outstanding common stock and
certain warrants of Cryenco and of $685,000 to redeem the outstanding preferred
stock of Cryenco. Pursuant to the Merger Agreement, the Company also entered
into the Amended Warrant Agreements between the Company, Cryenco, and the
holders of certain other warrants for the purchase of the common stock of
Cryenco (the "Cryenco Warrants"). The Amended Warrant Agreements convert the
Cryenco Warrants into warrants for the purchase of the Company's Common Stock,
par value $.01 per share, at the conversion ratio provided for in the Merger
Agreement. The Cryenco Warrants and the Amended Warrant Agreements are
filed as Exhibits hereto.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET ADJUSTMENTS
The accompanying Pro Forma Condensed Consolidated Balance Sheet as of June 30,
1997 gives effect to the Merger by combining the Company's June 30, 1997
balances with Cryenco's May 31, 1997 balances to conform the different fiscal
year ends. The estimated fair market values reflected herein are based on
preliminary estimates and assumptions and are subject to revision as more
information becomes available. In management's opinion, the preliminary
allocation is not expected to be materially different from the final
allocation.
(1) To record the total consideration paid for preferred and common stock
and common stock warrants including estimated transaction costs.
(2) Preliminary allocation of purchase price was made to goodwill pending
final valuations when available.
34
<PAGE> 35
(3) Recognition of the Company's common stock warrants at fair value
exchanged for Cryenco common stock warrants.
(4) To eliminate Cryenco common stock, preferred stock, additional paid in
capital and retained deficit.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
ADJUSTMENTS
The accompanying Pro Forma Condensed Consolidated Statements of Operations for
the six months ended June 30, 1997 and the year ended December 31, 1996 give
effect to the Merger as if such merger occurred on January 1, 1996 by combining
the indicated periods of the Company with the six month period ended May
31, 1997 and the twelve month period ended November 30, 1996 for Cryenco to
conform the different fiscal year ends.
(5) To record adjustment to amortization expense relative to the
Company's new basis in net assets acquired in conjunction with the
Merger as if said merger had occurred January 1, 1996. The
amortization expense of $111,000 and $222,000 for the six months
ended June 30, 1997 and the year ended December 31, 1996,
respectively, is resultant from the amortization, over a 40-year
life, of the $8,863,000 in additional goodwill recorded in
conjunction with the Merger.
(6) To record additional interest expense of $860,000 and $1,720,000 for
the six months ended June 30, 1997 and the year ended December 31,
1996, respectively, which would have been incurred by the Company
assuming the Merger had occurred January 1, 1996. Interest expense
has been calculated based on the $20.2 million utilization on the
available line of credit used to fund total consideration in
conjunction with the Merger.
(7) To record the tax benefit reflecting an effective rate of 30.9
percent. This adjustment reflects a tax benefit of $292,000 and
$602,000 for the six months ended June 30, 1997 and the year ended
December 31, 1996, respectively. The Company's management believes
that this effective rate is indicative of the Company's tax position
assuming the Merger had occurred on January 1, 1996. The goodwill
amortization created by this transaction is not tax deductible.
35
<PAGE> 36
C) EXHIBITS
Number Description
------ -----------
2.1 Plan and Agreement of Merger, dated April 30, 1997, among
Chart Industries, Inc. ("Chart"), Greenville Tube
Corporation, Chart Acquistion Company, Inc. and Cryenco
Sciences, Inc. ("Cryenco").*
4.2 Common Stock Purchase Warrant (Right to Purchase 36,086
Shares of Convertible Non-Voting Common Stock of Cryenco)
between Cryenco and Chemical Bank.
4.3 Common Stock Purchase Warrant (Right to Purchase 7,317
Shares of Convertible Non-Voting Common Stock of Cryenco)
between Cryenco and Chemical Bank.
4.4 Amendment to Warrant Agreement, dated as of July 31, 1997,
by and between The Chase Manhattan Bank (f/k/a Chemical
Bank), Cryenco, and Chart.
4.5 Common Stock Purchase Warrant (Right to Purchase 32,195
Shares of Convertible Non-Voting Common Stock of Cryenco)
between Cryenco and the CIT Group/Equity Investments, Inc.
("CIT").
4.6 Common Stock Purchase Warrant (Right to Purchase 18,042
Shares of Voting Common Stock of Cryenco) between Cryenco
and CIT.
4.7 Amendment to Warrant Agreement, dated as of July 31, 1997,
by and between CIT, Cryenco and Chart.
4.8 Warrant Agreement, dated as of June 8, 1994, between
Cryenco and Cryogenic TADOPTR Company, L.P. ("TADOPTR"),
for the purchase of up to 200,000 shares of Cryenco Common
Stock.
4.9 Amendment No. 1 to Warrant Agreement, dated as of July 31,
1997, by and between TADOPTR, Cryenco, and Chart.
- --------
* The Registrant agrees by this filing to supplementally furnish a copy of the
Exhibits and Schedules to this Stock Purchase Agreement to the Commission upon
request.
36
<PAGE> 37
4.10 Warrant Agreement, dated as of December 20, 1994, between
Cryenco and The Edgehill Corporation ("Edgehill"), for the
purchase of up to 25,000 shares of Cryenco Common Stock.
4.11 Certificate for 25,000 Warrants for the purchase of
Cryenco Common Stock, dated as of December 20, 1994.
4.12 Amendment No. 1 to Warrant Agreement, dated as of July 31,
1997, by and between Edgehill, Cryenco, and Chart.
4.13 Warrant Agreement, dated as of March 12, 1993, between
Cryenco and Don M. Harwell ("Harwell"), for the purchase of
up to 50,000 shares of Cryenco Common Stock.
4.14 Certificate for 50,000 Warrants for the purchase of Cryenco
Common Stock, dated as of March 12, 1993.
4.15 Warrant Agreement, dated as of January 26, 1995, between
Cryenco and Harwell, for the purchase of up to 25, 000
shares for the purchase of Cryenco Common Stock.
4.16 Certificate for 25,000 Warrants for the purchase of Cryenco
Common Stock, dated as of January 26, 1995.
4.17 Amendment No. 1 to Warrant Agreement, dated as of July 31,
1997, by and between Harwell, Cryenco, and Chart.
4.18 Class A Common Stock Purchase Warrant, dated January 30,
1995, between Cryenco and International Capital Partners
("ICP"), for the purchase of up to 116,000 shares of
Cryenco Common Stock.
4.19 Class A Common Stock Purchase Warrant, dated January 30,
1995, between Cryenco and International Capital Partners
("ICP"), for the purchase of up to 44,000 shares of Cryenco
Common Stock.
4.20 Amendment No. 1 to Warrant Agreement, dated as of July 31,
1997, by and between ICP, Cryenco and Chart.
4.21 Warrant Agreement, dated as of March 12, 1993, between
Cryenco and Mezzanine Capital Corporation Limited ("MCC"),
for the purchase of up to 30,000 shares of Cryenco Common
Stock.
4.22 Certificate for 30,000 Warrants for the purchase of Cryenco
Common Stock, dated as of March 12, 1993.
4.23 Warrant Agreement, dated as of January 26, 1995, between
Cryenco and MCC, for the purchase of up to 15, 000 shares
of Cryenco Common Stock.
37
<PAGE> 38
4.24 Certificate for 15,000 Warrants for the purchase of Cryenco
Common Stock, dated as of January 26, 1995.
4.25 Amendment No. 1 to Warrant Agreement, dated as of July 31,
1997, by and between MCC (in liquidation), Cryenco, and
Chart.
4.26 Warrant Agreement, dated as of March 12, 1993, between
Cryenco and Alfred Schechter ("Schechter"), for the
purchase of up to 50,000 shares of Cryenco Common Stock.
4.27 Certificate for 50,000 Warrants for the purchase of Cryenco
Common Stock, dated as of March 12, 1993.
4.28 Warrant Agreement, dated as of January 26, 1995, between
Cryenco and Schechter, for the purchase of up to 25,000
shares of Cryenco Common Stock.
4.29 Certificate for 25,000 Warrants for the purchase of
Cryenco Common Stock, dated as of January 26, 1995.
4.30 Amendment No. 1 to Warrant Agreement, dated as of July 31,
1997, by and between Schechter, Cryenco, and Chart.
10.20 Credit Agreement by and between Chart, ALTEC International
Limited Partnership, ALTEC, Inc., Chart Management Company,
Inc., Chart Industries Foreign Sales Corporation,
Greenville Tube Corporation, and Process Systems
International Inc. (collectively, the "Borrowing Group");
National City Bank and NBD Bank (collectively, the
"Banks"); and National City Bank as Agent for the Banks,
dated July 29, 1997.
10.21 Revolving Note for $27,000,000.00, dated July 29, 1997,
executed by the Borrowing Group for National City Bank.
10.22 Revolving Note for $18,000,000.00, dated July 29, 1997,
executed by the Borrowing Group for NBD Bank.
10.23 Pledge Agreement for Shares of CHD, Inc., dated July 29,
1997, executed by ALTEC, Inc., and Chart Management
Company, Inc. for National City Bank as Agent for the
Banks.
23.1 Consent of Ernst & Young LLP.
38
<PAGE> 39
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS CURRENT REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THERUNTO DULY AUTHORIZED.
CHART INDUSTRIES, INC.
By: /s/ DON A. BAINES
DON A. BAINES
CHIEF FINANCIAL OFFICER AND
TREASURER
Dated: August 14, 1997
39
<PAGE> 40
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION PAGE
2.1 Plan and Agreement of Merger, dated April 30, 1997,
among Chart Industries, Inc. ("Chart"), Greenville
Tube Corporation, Chart Acquisition Company, Inc. and
Cryenco Sciences, Inc. ("Cryenco").
4.2 Common Stock Purchase Warrant (Right to Purchase
36,086 Shares of Convertible Non-Voting Common Stock
of Cryenco) between Cryenco and Chemical Bank.
4.3 Common Stock Purchase Warrant (Right to Purchase 7,317
Shares of Convertible Non-Voting Common Stock of
Cryenco) between Cryenco and Chemical Bank.
4.4 Amendment to Warrant Agreement, dated as of July 31,
1997, by and between The Chase Manhattan Bank (f/k/a
Chemical Bank), Cryenco, and Chart.
4.5 Common Stock Purchase Warrant (Right to Purchase
32,195 Shares of Convertible Non-Voting Common Stock
of Cryenco) between Cryenco and the CIT Group/Equity
Investments, Inc. ("CIT").
4.6 Common Stock Purchase Warrant (Right to Purchase
18,042 Shares of Voting Common Stock of Cryenco)
between Cryenco and CIT.
4.7 Amendment to Warrant Agreement, dated as of July 31,
1997, by and between CIT, Cryenco and Chart.
4.8 Warrant Agreement, dated as of June 8, 1994, between
Cryenco and Cryogenic TADOPTR Company, L.P.
("TADOPTR"), for the purchase of up to 200,000 shares
of Cryenco Common Stock.
4.9 Amendment No. 1 to Warrant Agreement, dated as of July
31, 1997, by and between TADOPTR, Cryenco, and Chart.
4.10 Warrant Agreement, dated as of December 20, 1994,
between Cryenco and The Edgehill Corporation
("Edgehill"), for the purchase of up to 25,000 shares
of Cryenco Common Stock.
40
<PAGE> 41
4.11 Certificate for 25,000 Warrants for the purchase of
Cyrenco Common Stock, dated as of December 20, 1994.
4.12 Amendment No. 1 to Warrant Agreement, dated as of July
31, 1997, by and between Edgehill, Cryenco, and Chart
4.13 Warrant Agreement, dated as of March 12, 1993, between
Cryenco and Don M. Harwell ("Harwell"), for the
purchase of up to 50,000 shares of Cryenco Common
Stock.
4.14 Certificate for 50,000 Warrants for the purchase of
Cryenco Common Stock, dated as of March 12, 1993.
4.15 Warrant Agreement, dated as of January 26, 1995,
between Cryenco and Harwell, for the purchase of up to
25, 000 shares for the purchase of Cryenco Common
Stock.
4.16 Certificate for 25,000 Warrants for the purchase of
Cryenco Common Stock, dated as of January 26, 1995.
4.17 Amendment No. 1 to Warrant Agreement, dated as of July
31, 1997, by and between Harwell, Cryenco, and Chart.
4.18 Class A Common Stock Purchase Warrant, dated January
30, 1995, between Cryenco and International Capital
Partners ("ICP"), for the purchase of up to 116,000
shares of Cryenco Common Stock.
4.19 Class A Common Stock Purchase Warrant, dated January
30, 1995, between Cryenco and International Capital
Partners ("ICP"), for the purchase of up to 44,000
shares of Cryenco Common Stock.
4.20 Amendment No. 1 to Warrant Agreement, dated as of July
31, 1997, by and between ICP, Cryenco and Chart.
4.21 Warrant Agreement, dated as of March 12, 1993, between
Cryenco and Mezzanine Capital Corporation Limited
("MCC"), for the purchase of up to 30,000 shares of
Cryenco Common Stock.
4.22 Certificate for 30,000 Warrants for the purchase of
Cryenco Common Stock, dated as of March 12, 1993.
4.23 Warrant Agreement, dated as of January 26, 1995,
between Cryenco and MCC, for the purchase of up to 15,
000 shares of Cryenco Common Stock.
4.24 Certificate for 15,000 Warrants for the purchase of
Cryenco Common Stock, dated as of January 26, 1995.
41
<PAGE> 42
4.25 Amendment No. 1 to Warrant Agreement, dated as of July
31, 1997, by and between MCC (in liquidation),
Cryenco, and Chart.
4.26 Warrant Agreement, dated as of March 12, 1993, between
Cryenco and Alfred Schechter ("Schechter"), for the
purchase of up to 50,000 shares of Cryenco Common
Stock.
4.27 Certificate for 50,000 Warrants for the purchase of
Cryenco Common Stock, dated as of March 12, 1993.
4.28 Warrant Agreement, dated as of January 26, 1995,
between Cryenco and Schechter, for the purchase of up
to 25,000 shares of Cryenco Common Stock.
4.29 Certificate for 25,000 Warrants for the purchase of
Cryenco Common Stock, dated as of January 26, 1995.
4.30 Amendment No. 1 to Warrant Agreement, dated as of July
31, 1997, by and between Schechter, Cryenco, and
Chart.
10.20 Credit Agreement by and between Chart, ALTEC
International Limited Partnership, ALTEC, Inc., Chart
Management Company, Inc., Chart Industries Foreign
Sales Corporation, Greenville Tube Corporation, and
Process Systems International Inc.; National City Bank
and NBD Bank (collectively, the "Banks"); and National
City Bank as Agent for the Banks, dated July 29, 1997.
10.21 Revolving Note for $27,000,000.00, dated July 29, 1997,
executed by the Borrowing Group for National City Bank.
10.22 Revolving Note for $18,000,000.00, dated July 29, 1997,
executed by the Borrowing Group for NBD Bank.
10.23 Pledge Agreement for Shares of CHD, Inc., dated July 29,
1997, by ALTEC, Inc., and Chart Management Company, Inc.
for National City Bank as Agent for the Banks.
23.1 Consent of Ernst & Young LLP.
<PAGE> 1
Exhibit 2.1
PLAN AND AGREEMENT OF MERGER
dated as of
April 30, 1997
among
CHART INDUSTRIES, INC.,
GREENVILLE TUBE CORPORATION
CHART ACQUISITION COMPANY, INC.,
and
CRYENCO SCIENCES, INC.
<PAGE> 2
<TABLE>
TABLE OF CONTENTS
<S> <C>
ARTICLE I THE MERGER..............................................................................................1
1.1 The Merger.................................................................................................1
1.2 Effective Time of the Merger...............................................................................1
1.3 Effect of the Merger.......................................................................................2
1.4 Continuation of Business...................................................................................2
1.5 Directors and Officers of Surviving Corporation............................................................2
1.6 No Further Rights or Transfers.............................................................................2
ARTICLE II CLOSING................................................................................................2
2.1 Closing....................................................................................................2
2.2 Deliveries at Closing......................................................................................3
ARTICLE III MERGER CONSIDERATION AND EFFECT OF THE MERGER ON
THE CAPITAL STOCK OF CAC AND CRYENCO; PAYMENT OF MERGER
CONSIDERATION.....................................................................................................4
3.1 Effect on Capital Stock....................................................................................4
(a) Capital Stock of CAC........................................................................4
(b) Cryenco Common Stock........................................................................4
(c) Cryenco Preferred Stock.....................................................................4
(d) Distribution of Merger Consideration........................................................4
3.2 Payment of Merger Consideration............................................................................4
(a) Exchange Agent..............................................................................4
(b) Exchange Procedures.........................................................................4
(c) No Further Ownership Rights in Cryenco Common Stock and
Cryenco Preferred Stock................................................................5
(d) Termination of Exchange Fund................................................................5
(e) Dissenting Shares...........................................................................5
ARTICLE IV CRYENCO PROXY STATEMENT................................................................................6
4.1 Filing of Proxy Statement..................................................................................6
4.2 Cryenco Covenant...........................................................................................6
ARTICLE V ADDITIONAL COVENANTS AND AGREEMENTS.....................................................................6
5.1 Additional Covenants of All Parties........................................................................6
(a) Corporate Actions...........................................................................7
(b) Publicity...................................................................................7
(c) Notice of Certain Events....................................................................7
(d) Advice of Changes...........................................................................7
(e) Further Assurances..........................................................................7
5.2 Conduct of Business of Cryenco Until Closing Date..........................................................7
5.3 Additional Covenants of Cryenco...........................................................................10
(a) Approval of Cryenco Stockholders...........................................................10
(b) Access to Information and Confidentiality..................................................10
(c) No Solicitations...........................................................................11
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C>
(d) No Acquisitions............................................................................11
(e) Third-Party Consents.......................................................................12
(f) Employee and Non-Employee Director Options.................................................12
(g) Cryenco Warrants...........................................................................13
(h) Monthly Financial Information..............................................................13
5.4 Additional Covenants of Chart.............................................................................13
(a) Indemnification and Insurance..............................................................13
(b) Disposition of Cryenco Options and Cryenco Warrants........................................14
ARTICLE VI REPRESENTATIONS AND WARRANTIES........................................................................15
6.1 Representations and Warranties of Cryenco.................................................................15
(a) Due Organization...........................................................................15
(b) Power and Authority; No Conflicts..........................................................15
(c) Capital Structure..........................................................................16
(d) Subsidiaries...............................................................................16
(e) SEC Documents..............................................................................17
(f) Vote Required..............................................................................18
(g) Title to Assets............................................................................18
(h) Condition of Assets........................................................................18
(i) Accounts Receivable and Accounts Payable...................................................18
(j) Insurance..................................................................................18
(k) Dividends and Distributions................................................................19
(l) Cryenco Data..............................................................................19
(m) Undisclosed Liabilities....................................................................19
(n) Investigation or Litigation................................................................19
(o) Certain Agreements.........................................................................20
(p) Employee Benefits..........................................................................20
(q) Labor Matters..............................................................................21
(r) Taxes......................................................................................22
(s) Absence of Certain Changes.................................................................23
(t) Legal Compliance...........................................................................23
(u) Environmental Protection...................................................................23
(v) Patents, Copyrights, Trademarks, Trade Names etc...........................................25
(w) Contracts..................................................................................25
(x) Full Disclosure............................................................................25
(y) Brokers or Finders.........................................................................25
6.2 Representations and Warranties of Chart, GTC and CAC......................................................25
(a) Due Organization...........................................................................25
(b) Power and Authority, No Conflicts..........................................................26
(c) Financing of the Merger....................................................................26
(d) Brokers and Finders........................................................................27
ARTICLE VII CONDITIONS...........................................................................................27
7.1 Conditions Precedent to the Obligations of All Parties....................................................27
(a) Stockholder Approvals......................................................................27
(b) Governmental Approvals.....................................................................27
(c) No Injunctions or Restraints...............................................................27
7.2 Conditions Precedent to the Obligations of Cryenco........................................................27
</TABLE>
ii
<PAGE> 4
<TABLE>
<S> <C>
(a) Representations and Warranties True........................................................27
(b) Performance of Obligations and Agreements..................................................28
(c) Resolutions................................................................................28
(d) Officers' Certificates.....................................................................28
7.3 Conditions Precedent to the Obligations of Chart, GTC and CAC.............................................28
(a) Representations and Warranties True........................................................28
(b) Performance of Obligations and Agreements..................................................28
(c) Resolutions................................................................................28
(d) Officer's Certificate......................................................................28
(e) Consents and Approvals.....................................................................29
(f) No Cryenco Material Adverse Effect.........................................................29
(g) Dissenters Claims..........................................................................29
(h) Cryenco Arrangements with Affiliated Persons...............................................29
(i) Cancellation, Exercise Sale or Exchange of Cryenco Warrants
and Options...........................................................................29
ARTICLE VIII TERMINATION AND AMENDMENT...........................................................................29
8.1 Termination...............................................................................................29
8.2 Effect of Termination.....................................................................................31
8.3 Amendment.................................................................................................31
8.4 Waiver....................................................................................................31
8.5 Fees, Expenses and Other Payments.........................................................................31
ARTICLE IX GENERAL PROVISIONS....................................................................................32
9.1 Effectiveness of Representations, Warranties and Agreements...............................................32
9.2 Notices...................................................................................................33
9.3 Governing Law.............................................................................................34
9.4 Successors................................................................................................34
9.5 Assignment................................................................................................34
9.6 Counterparts..............................................................................................34
Schedules.....................................................................................................34
9.7 Entire Agreement..........................................................................................34
</TABLE>
iii
<PAGE> 5
<TABLE>
TABLE OF SCHEDULES
<S> <C>
Schedule 1.2 Certificate of Merger
Schedule 5.1 (a) Third Party Consents and Approvals
Schedule 5.1(e) Cryenco Arrangements with Affiliated Persons
Schedule 5.2(viii) Interests in Cryenco Assets
Schedule 5.3(b) Confidentiality Agreement
Schedule 5.4(h) Cryenco Options and Warrants
Schedule 6.1 (b) Power and Authority; No Conflicts
Schedule 6.1 (c) Cryenco Capital Structure
Schedule 6.1 (d) Subsidiaries
Schedule 6.1 (e) SEC Documents
Schedule 6.1 (h) Title to Assets
Schedule 6.1 (i) Condition of Assets
Schedule 6.1 (1) Insurance
Schedule 6.1 (p) Investigation or Litigation
Schedule 6.1 (q) Certain Agreements
Schedule 6.1(r) Employee Benefits
Schedule 6.1 (s) Labor Matters
Schedule 6.1 (u) Absence of Certain Changes
Schedule 6.1 (w) Environmental Protection
Schedule 6.1 (x) Patents, Trademarks, Trade Names, etc.
Schedule 6.1 (y) Contracts
Schedule 6.1(aa) Loss Contingencies
Schedule 6.2(b) Power and Authority; No Conflicts
Schedule 6.2(c) Chart's Capital Structure
Schedule 6.2(d) SEC Documents
Schedule 6.2(h) Dividends and Distributions
Schedule 6.2(m) Absence of Certain Changes
Schedule 6.2(n) Loss Contingencies
Schedule 7.3(h) Form of Stockholder Letter
</TABLE>
iv
<PAGE> 6
<TABLE>
INDEX OF DEFINED TERMS
<S> <C>
"Agreement".......................................................................................................1
"CAC".............................................................................................................1
"Certificate of Merger"...........................................................................................1
"Chart Material Adverse Effect"..................................................................................26
"Chart Option....................................................................................................14
"Chart Options"..................................................................................................14
"Chart"...........................................................................................................1
"Claim"..........................................................................................................24
"Closing Date"....................................................................................................2
"Closing".........................................................................................................2
"Continuing Employees"...........................................................................................12
"Cryenco Certificate".............................................................................................2
"Cryenco Common Stock"............................................................................................4
"Cryenco Data"...................................................................................................19
"Cryenco Material Adverse Effect"................................................................................15
"Cryenco Preferred Stock".........................................................................................4
"Cryenco SEC Documents"..........................................................................................17
"Cryenco Special Meeting"........................................................................................10
"Cryenco Stockholders' Approval..................................................................................10
"Cryenco Stockholders"............................................................................................4
"Cryenco".........................................................................................................1
"DGCL"............................................................................................................1
"Effective Time"..................................................................................................1
"Environmental Claim" or "Claim".................................................................................24
"Environmental Laws".............................................................................................24
"ERISA Affiliate"................................................................................................20
"ERISA"..........................................................................................................20
"Exchange Act"....................................................................................................6
"Exchange Agent"..................................................................................................4
"Exchange Fund"...................................................................................................4
"Governmental Agency"............................................................................................16
"GTC".............................................................................................................1
"Insider Agreements".............................................................................................29
"Merger"..........................................................................................................1
"Plans"..........................................................................................................20
"Proxy Statement".................................................................................................6
"Returns"........................................................................................................22
"SEC Investigation"..............................................................................................18
"SEC".............................................................................................................6
"Secretary".......................................................................................................1
"Surviving Corporation Common Stock"..............................................................................4
"Surviving Corporation"...........................................................................................1
"Transmittal Letter"..............................................................................................5
</TABLE>
v
<PAGE> 7
PLAN AND AGREEMENT OF MERGER
THIS PLAN AND AGREEMENT OF MERGER (the "Agreement"), dated as of April
___, 1997, is among CHART INDUSTRIES, INC., a Delaware corporation ("Chart"),
GREENVILLE TUBE CORPORATION, an Arkansas corporation ("GTC") and a wholly-owned
subsidiary of Chart, CHART ACQUISITION COMPANY, INC., a Delaware corporation
("CAC") and a wholly-owned subsidiary of GTC, and CRYENCO SCIENCES, INC., a
Delaware corporation ("Cryenco").
WHEREAS, on the terms and subject to the conditions set forth in this
Agreement, Chart desires to acquire, through merger, One Hundred Percent (100%)
of the shares of capital stock of Cryenco issued and outstanding on the date
hereof (and to be outstanding on the Closing Date, as defined in Section 2.1);
WHEREAS, the respective Boards of Directors of Chart, GTC, CAC and
Cryenco deem the merger to be advisable and in the best interests of each of
Chart, GTC, CAC and Cryenco and their respective stockholders and have adopted
resolutions approving the acquisition by Chart of Cryenco through the merger of
CAC with and into Cryenco (the "Merger") in accordance with the laws of the
State of Delaware upon the terms and conditions set forth in this Agreement;
WHEREAS, the Board of Directors of Cryenco has directed that this
Agreement be submitted for consideration at a special meeting of the voting
stockholders of Cryenco;
WHEREAS, unless the context shall otherwise require, capitalized terms
used herein shall have the meanings assigned thereto.
NOW, THEREFORE, in consideration of their respective agreements and
undertakings set forth herein, the parties agree as follows:
ARTICLE I
THE MERGER
1.1 The Merger. On the terms and subject to the conditions set forth in
this Agreement and in reliance on the representations, warranties and covenants
set forth herein, at the Effective Time, as defined in Section 1.2, CAC shall be
merged with and into Cryenco in accordance with the laws of the State of
Delaware, with Cryenco being the surviving corporation (the "Surviving
Corporation").
1.2 Effective Time of the Merger. The Merger shall be effective when a
certificate of merger in the form of Schedule 1.2 (the "Certificate of Merger")
shall have been properly executed by CAC and Cryenco and delivered to and
accepted for filing by the Secretary of State of the State of Delaware
("Secretary") in accordance with the Delaware General Corporation Law ("DGCL"),
which filing shall be made as promptly as practicable following the Closing, as
defined in Section 2.1. When used in this Agreement, the term "Effective Time"
shall mean the time and the date as of which the Certificate of Merger shall
have been accepted for filing in the office of the Secretary.
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1.3 Effect of the Merger.
(a) At the Effective Time, (i) the separate existence and
corporate organization of CAC shall cease, and CAC shall be merged with and into
Cryenco; (ii) the Certificate of Incorporation of CAC as in effect immediately
prior to the Effective Time shall become the Certificate of Incorporation of the
Surviving Corporation (except as set forth in the Certificate of Merger); and
(iii) the By-laws of CAC as in effect immediately prior to the Effective Time
shall be the By-laws of the Surviving Corporation.
(b) At and after the Effective Time, the Merger shall have the
effect set forth in the DGCL.
1.4 Continuation of Business. The Surviving Corporation shall, after
the Effective Time, continue the businesses of CAC and Cryenco with the assets
of both of such constituent corporations.
1.5 Directors and Officers of Surviving Corporation. As of the
Effective Time, the directors of CAC immediately prior to the Effective Time
shall become the directors of the Surviving Corporation. The officers of CAC
immediately prior to the Effective Time shall become the officers of the
Surviving Corporation. Each of such directors and officers shall hold office
until their respective successors are duly elected or appointed and qualified in
the manner provided in the Certificate of Incorporation and By-laws of the
Surviving Corporation, or as otherwise provided by law.
1.6 No Further Rights or Transfers. At and after the Effective Time.
(a) The stock transfer books of Cryenco shall be closed and
there shall be no further registration of transfers on the stock transfer books
of Cryenco thereafter.
(b) All shares of Cryenco Common Stock and Cryenco Preferred
Stock shall no longer be outstanding and shall automatically be canceled and
retired and shall cease to exist, and each holder of a certificate representing
any such shares ("Cryenco Certificate") shall cease to have any rights with
respect thereto, except the right to receive the Merger Consideration (as
defined below) to be issued or paid in consideration therefor upon the surrender
of such Cryenco Certificate in accordance with Article III hereof.
ARTICLE II
CLOSING
2.1 Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of Calfee, Halter &
Griswold LLP, 1400 McDonald Investment Center, 800 Superior Avenue, Cleveland,
Ohio, at 10:00 am, local time, on the second business day immediately following
the date on which the last of the conditions set forth in Article VII hereof is
fulfilled or waived, or at such other time and place as Chart and Cryenco may
mutually agree (the "Closing Date").
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<PAGE> 9
2.2 Deliveries at Closing.
(a) At the Closing, Cryenco shall deliver to Chart, GTC and
CAC:
(i) the resolutions referred to in Section 7.3(c)
hereof;
(ii) the certificate referred to in Section 7.3(d)
hereof;
(iii) a certificate representing 100 shares of
Cryenco Common Stock duly registered in Chart's name, duly
executed and authenticated;
(iv) copies of the executed consents referred to in
Section 7.3(e) hereof;
(v) evidence, in form reasonably satisfactory to
Chart, of the termination of the arrangements with Cryenco
affiliates described in Section 7.3(h);
(vi) executed agreements with the holders of Cryenco
Warrants and Cryenco Options exercising such warrants and
options or agreeing to the cancellation or exchange thereof
all as described in Section 5.3(f) and 5.3(g) hereof; and
(vii) all other documents, instruments and writings
reasonably requested by Chart, GTC or CAC at or prior to
Closing pursuant to this Agreement or otherwise required
herein.
(b) At the Closing, Chart, GTC and CAC shall deliver to
Cryenco:
(i) the resolutions referred to in Section 7.2(c)
hereof;
(ii) the certificates referred to in Section 7.2(d)
hereof;
(iii) the warrants and options to purchase shares of
Chart Common Stock issuable in exchange for Cryenco Warrants
and Cryenco Options pursuant to the provisions of Section
5.4(b) and the cash payment required under Section 5.4(b); and
(iv) all other documents, instruments and writings
reasonably requested by Cryenco at or prior to Closing
pursuant to this Agreement or otherwise required herein.
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<PAGE> 10
ARTICLE III
MERGER CONSIDERATION AND EFFECT OF THE MERGER ON
THE CAPITAL STOCK OF CAC AND CRYENCO;
PAYMENT OF MERGER CONSIDERATION
3.1 Effect on Capital Stock. As of the Effective Time, by virtue of
the Merger and without any action on the part of the holder of any shares of
Cryenco capital stock ("Cryenco Stockholders") or CAC capital stock:
(a) Capital Stock of CAC. Each issued and outstanding share of
the capital stock of CAC shall be converted into and become one fully paid and
nonassessable share of common stock, par value $.01 per share, of the Surviving
Corporation ("Surviving Corporation Common Stock").
(b) Cryenco Common Stock. Each issued and outstanding share of
the Class A common stock, $.01 par value per share of Cryenco and each issued
and outstanding share of the convertible non-voting common stock, $.01 par value
per share of Cryenco, if any ("Cryenco Common Stock"), other than shares as to
which dissenters rights are perfected pursuant to Section 3.2(e) below, shall be
converted into the right to receive a cash amount equal to $2.75.
(c) Cryenco Preferred Stock. Each issued and outstanding share
of Cryenco Series A Preferred Stock, $.01 par value per share (the "Cryenco
Preferred Stock"), shall be converted into the right to receive cash in an
amount equal to the sum of $10 plus any accumulated but unpaid (as of the
Effective Time) dividends with respect to such share of Cryenco Preferred Stock.
(d) Distribution of Merger Consideration. The cash amounts
into which shares of Cryenco Common Stock and Cryenco Preferred Stock are
converted pursuant to Section 3.1(b) and (c) above are hereafter referred to as
the "Merger Consideration". The Merger Consideration shall be distributed to the
Cryenco Stockholders in accordance with Section 3.2 below.
3.2 Payment of Merger Consideration.
(a) Exchange Agent. As of the Effective Time, Chart shall
deposit with National City Bank or such other bank or trust company designated
by Chart (and reasonably acceptable to Cryenco) (the "Exchange Agent"), for the
benefit of the Cryenco Stockholders, for exchange through the Exchange Agent in
accordance with this Article III, cash in an amount sufficient to effect the
cash payments provided for in Sections 3.1(b) and 3.1(c) hereof (such cash being
hereinafter referred to as the "Exchange Fund").
(b) Exchange Procedures. As soon as reasonably practicable
after the Effective Time, the Exchange Agent shall mail to each holder of record
as of the Effective Time of a Cryenco Certificate or Certificates (who has not
perfected dissenters rights pursuant to Section 3.2(e) below) (A) a letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Cryenco Certificates shall pass, only upon delivery of the
4
<PAGE> 11
Cryenco Certificates to the Exchange Agent and shall be in such form and have
such other provisions as Chart and Cryenco may reasonably specify) ("Transmittal
Letter") and (B) instructions for use in effecting the surrender of the Cryenco
Certificates for cash in the amounts prescribed by either Section 3.1(b) or
Section 3.1(c) above. Upon surrender of a Cryenco Certificate for Cryenco Common
Stock for cancellation to the Exchange Agent together with such Transmittal
Letter, duly executed, the holder of such Cryenco Certificate for Cryenco Common
Stock shall be entitled to receive in exchange therefor cash in an amount equal
to $2.75 per share of Cryenco Common Stock surrendered. Upon surrender of a
Cryenco Certificate for Cryenco Preferred Stock for cancellation to the Exchange
Agent, together with such Transmittal Letter, duly executed, the holder of such
Cryenco Certificate for Cryenco Preferred Stock shall be entitled to receive in
exchange therefor cash in an amount per share prescribed by Section 3.1(c)
above. Cryenco Certificates so surrendered shall forthwith be canceled. Until
surrendered as contemplated by this Section 3.2, each Cryenco Certificate shall
be deemed at any time after the Effective Time to represent only the right to
receive upon such surrender the Merger Consideration as contemplated by Section
3.1(b) or 3.1(c).
(c) No Further Ownership Rights in Cryenco Common Stock and
Cryenco Preferred Stock. The Merger Consideration paid upon the surrender of
shares of Cryenco Common Stock or Cryenco Preferred Stock in accordance with the
terms hereof shall be deemed to have been paid in full satisfaction of all
rights pertaining to such shares of Cryenco Common Stock or Cryenco Preferred
Stock. As of the Effective Time, entries shall be made in the stock transfer
books of Cryenco to reflect the cancellation of the Cryenco Common Stock and the
Cryenco Preferred Stock issued and outstanding immediately prior to the
Effective Time and there shall be no further registration of transfers on the
stock transfer books of the Surviving Corporation of the shares of Cryenco
Common Stock and the Cryenco Preferred Stock that were outstanding immediately
prior to the Effective Time. If, after the Effective Time, Cryenco Certificates
are presented to the Surviving Corporation for any reason, they shall be
canceled and exchanged as provided in this Article III.
(d) Termination of Exchange Fund. Any portion of the Exchange
Fund that remains undistributed to the Cryenco Stockholders (pursuant to Section
3.2 (a) above) for twelve months after the Effective Time shall be delivered to
Chart, upon demand, and any Cryenco Stockholders who have not theretofore
complied with this Article III shall thereafter look only to Chart for payment
of their claim for cash.
(e) Dissenting Shares. Notwithstanding any other provision of
this Agreement, shares of Cryenco Common Stock that are outstanding immediately
prior to the Effective Time and which are held by holders of shares of Cryenco
Common Stock who shall have (a) not voted in favor of the Merger or consented
thereto in writing, (b) demanded properly in writing appraisal for such shares
in accordance with Section 262 of the DGCL, and (c) not withdrawn such demand or
otherwise forfeited appraisal rights (collectively, the "Dissenting Shares"),
shall not be converted into or represent the right to receive any part of the
Merger Consideration. Such holders of shares of Cryenco Common Stock shall be
entitled to receive payment of the appraised value of their shares in accordance
with the provisions of such Section 262, except that all Dissenting Shares held
by holders who shall have failed to perfect or who
5
<PAGE> 12
effectively shall have withdrawn or lost their appraisal rights under such
Section 262 shall thereupon be deemed to have been converted into and to have
become exchangeable, as of the Effective Time, for the right to receive, without
any interest thereon, cash in the amount of $2.75 per share of Cryenco Common
Stock, upon surrender, in the manner provided in Section 3.2, of the certificate
or certificates that formerly evidenced such shares of Cryenco Common Stock.
Cryenco shall give Chart (i) prompt notice of any demands for appraisal received
by Cryenco, withdrawals of such demands, and any other instruments served
pursuant to DGCL and received by Cryenco and (ii) the opportunity to participate
in all negotiations and proceedings occurring prior to the Effective Time with
respect to demands for appraisal under DGCL. Chart shall direct all proceedings
with respect to appraisal demands after the Effective Time. Cryenco shall not,
except with the prior written consent of Chart, make any payment with respect to
any demands for appraisal, or offer to settle, or settle, any such demands.
Dissenting Shares shall not, after the Effective Time, be entitled to vote for
any purpose or be entitled to the payment of dividends or other distributions
(except for dividends or other distributions payable to stockholders of record
as of a time prior to the Effective Time).
ARTICLE IV
CRYENCO PROXY STATEMENT
4.1 Filing of Proxy Statement. Cryenco will prepare and file with the
Securities and Exchange Commission ("SEC") as soon as reasonably practicable
after the date hereof a proxy statement complying with the Securities Exchange
Act of 1934, as amended ("Exchange Act") to be distributed by Cryenco in
connection with the solicitation of the approval by holders of Cryenco Common
Stock of the Merger (the "Proxy Statement"). Chart and Cryenco shall exchange
all information which the other party or its counsel may reasonably request and
which is required or customary for inclusion in the Proxy Statement.
4.2 Cryenco Covenant. Cryenco shall cause the Proxy Statement (i) to
comply in all material respects with the applicable provisions of the Exchange
Act and the rules and regulations of the SEC thereunder and (ii) at the time
such document is filed with the SEC, at the time of the mailing of the Proxy
Statement and any amendments thereof or supplements thereto, not to contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading, or
necessary to correct any statement in any earlier filing with the SEC of such
Proxy Statement or any amendment thereof or any supplement thereto or any
earlier communication (including the Proxy Statement) to stockholders of Cryenco
with respect to the transactions contemplated by this Agreement; provided
however, that no covenant or agreement is made by Cryenco in this Section 4.2 or
any other provision of this Agreement with respect to any information supplied
by Chart or its counsel for inclusion in the Proxy Statement.
ARTICLE V
ADDITIONAL COVENANTS AND AGREEMENTS
5.1 Additional Covenants of All Parties. Chart, GTC, CAC and Cryenco
agree that:
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<PAGE> 13
(a) Corporate Actions. Upon the terms and subject to the
conditions of this Agreement, each of Chart, GTC and CAC, on the one hand, and
Cryenco, on the other hand, shall (i) take all necessary corporate and other
actions, (ii) use its reasonable best efforts to obtain all necessary
authorizations and approvals, and (iii) make all necessary filings required to
carry out the transactions contemplated by this Agreement, to satisfy the
conditions specified in Article VII hereof at the earliest practicable date and
otherwise to perform their obligations under this Agreement.
(b) Publicity. Subject to each party's disclosure obligations
imposed by law, Chart, GTC and CAC, on the one hand, and Cryenco, on the other
hand, shall consult with each other prior to issuing any press releases or
otherwise making public statements with respect to the transactions contemplated
hereby and prior to making any filings with any federal or state governmental or
regulatory agency or with any securities exchange with respect thereto.
(c) Notice of Certain Events. If, in the course of the
transactions contemplated by this Agreement, either Chart, GTC or CAC, on the
one hand, or Cryenco, on the other hand, shall acquire knowledge of any fact,
law or circumstance which would be required to be disclosed, either by such
party or by the other party, to avoid a breach of a representation or warranty
contained in this Agreement, then such party shall immediately disclose such
fact, law or circumstance to the other party.
(d) Advice of Changes. Chart, GTC and CAC shall promptly
advise Cryenco of any change or event which individually or in the aggregate
with other such changes or events has a Chart Material Adverse Effect (as
defined below) or which Chart believes would or would be reasonably likely to
cause or constitute a material breach of any of the representations, warranties
or covenants of Chart, GTC and CAC contained herein. Cryenco shall promptly
advise Chart, GTC and CAC of any change or event which individually or in the
aggregate with other such changes or events has a Cryenco Material Adverse
Effect (as defined below) or which Cryenco believes would or would be reasonably
likely to cause or constitute a material breach of any of its representations,
warranties or covenants contained herein.
(e) Further Assurances. Before and after the Closing, each of
the parties shall make all reasonable best efforts to execute such other
documents and take such further actions as may be reasonably required or
desirable to carry out the provisions of this Agreement and the transactions
contemplated hereby.
5.2 Conduct of Business of Cryenco Until Closing Date. From the date of
this Agreement until the Closing Date, except with the prior written consent of
Chart, which consent shall not be unreasonably delayed or withheld, Cryenco
shall conduct its business in the ordinary course and consistent with past
practices and use its reasonable best efforts to preserve intact its business
organization and goodwill, keep available the services of its present officers
and key employees and preserve the goodwill and business relationships with
suppliers, customers and others having business relationships with it. Without
limiting the generality of the foregoing, Cryenco shall:
7
<PAGE> 14
(a) refrain from changing, in any material respect, any of its
business policies relating to its business;
(b) maintain and keep its assets in good repair, working order
and condition in the ordinary course of its business as presently conducted
(except for obsolescence and ordinary wear and tear and damage due to casualty);
(c) perform in all material respects all of its obligations
under all contracts, leases and any and all other agreements relating to or
affecting its assets or its business;
(d) refrain from:
(i) declaring or paying any dividends or other
distributions other than cash and preferred stock dividends
required by the terms of the Certificate of Designation with
respect to the Cryenco Preferred Stock;
(ii) except for issuing shares of Cryenco Common
Stock pursuant to the exercise of Cryenco Options or Cryenco
Warrants outstanding on the date hereof and listed on Schedule
6.1(c) or pursuant to options automatically granted between
the date hereof and the Closing pursuant to Cryenco 1993
Non-Employee Director Stock Option Plan, issuing Cryenco
Preferred Stock as preferred stock dividends as required by
the terms of the Certificate of Designation with respect to
the Cryenco Preferred Stock, issuing, redeeming, selling or
disposing of, or creating any obligation to issue, redeem,
sell or dispose of, any shares of its capital stock (whether
authorized but unissued or held in treasury) or any option,
warrant or security convertible into capital stock, including,
without limitation, making any contributions to any employee
stock ownership or compensation plans or granting any stock
options;
(iii) taking any action with respect to the grant of
any severance or termination pay (other than pursuant to
severance arrangements in effect on the date of this Agreement
and disclosed on a schedule to this Agreement to the extent
required) to any employees or with respect to any increase of
benefits payable under its severance or termination pay
policies or agreements in effect on the date hereof and
applicable to employees;
(iv) except for renewals of existing arrangements
which expire between the date of this Agreement and the
Closing, entering into, adopting, accelerating, modifying or
amending in any other manner any written employment,
collective bargaining, consulting, bonus, incentive
compensation, deferred compensation, employee stock option,
profit sharing, employee benefit, welfare benefit or other
agreement, plan or arrangement providing for compensation or
benefits to directors, officers or employees (except as
required by law or as necessary to maintain the tax-qualified
status of such plan, trust or other agreement);
8
<PAGE> 15
(v) increasing in any manner the compensation or
fringe benefits of any of Al Schechter, Rod Moe, William R.
Jones or James Raabe, or, except in the ordinary course of
business, of any other employee or paying any benefit or
compensation not required by any existing agreement, plan or
arrangement;
(vi) taking any action that could be reasonably
anticipated to have a Cryenco Material Adverse Effect, as
defined in Section 6.1(a), or that could reasonably be
anticipated to cause any representation or warranty set forth
in Article VI hereof to be untrue or any condition to Closing
not to be satisfied;
(vii) accelerating billings, shipments to customers,
payments from customers, orders from suppliers or payment of
accounts payable or adjusting the level of inventory, except
in the ordinary course of business;
(viii) entering into or assuming any new mortgage,
pledge, conditional sale or title retention agreement, lien,
easement, right-of-way, lease, encumbrance or charge of any
kind which will continue on or after the Closing upon the
assets of Cryenco, whether now or hereafter acquired, or
creating or assuming any obligation for borrowed money;
(ix) except as provided in the Cryenco budget for the
year ending August 31, 1997 (a copy of which has been provided
to Chart), making capital expenditures in excess of $100,000
in the aggregate;
(x) acquiring any of the business, capital stock or
assets constituting a business of any other person, firm,
association or corporation;
(xi) selling or otherwise disposing of assets of
Cryenco other than the sale of inventory in the ordinary
course of business;
(xii) entering into any settlement or other
dispositive agreements with respect to any litigation which
would obligate Cryenco for amounts in excess of $5,000 in any
one case or $100,000 in the aggregate for all cases;
(xiii) doing any act or omitting to do any act, or
permitting any act or omission to act, which Cryenco is aware
could reasonably be anticipated to cause a breach or default
by Cryenco under any of Cryenco's contracts, agreements,
commitments or obligations;
(xiv) entering into or amending any confidentiality
agreement or any agreement, contract or arrangement which
would impose any restriction on competition on Cryenco or on
the ability to hire employees from any person;
(xv) entering into or amending any other agreements,
commitments or contracts which, individually or in the
aggregate, are material to Cryenco, except agreements for the
purchase and sale of goods or services in the ordinary course
9
<PAGE> 16
of business, consistent with past practice and not in excess
of normal requirements;
(xvi) assuming or otherwise becoming liable or
responsible (whether directly, contingently or otherwise) for
any obligations or liabilities of any other person;
(xvii) moving the location of Cryenco's main offices
or any production facility;
(xviii) incurring expenses other than in the ordinary
course of business; provided, that Cryenco shall be entitled
to incur reasonable investment banking, legal and accounting
fees and expenses in connection with the Merger and the
Special Meeting; or
(xix) agreeing to take any of the foregoing actions.
5.3 Additional Covenants of Cryenco. Cryenco agrees that:
(a) Approval of Cryenco Stockholders. Cryenco shall as soon as
reasonably practicable (i) take all steps necessary duly to call, give notice
of, convene and hold a special meeting of holders of Cryenco Common Stock (the
"Cryenco Special Meeting") (A) for the purpose of adopting this Agreement (the
"Cryenco Stockholders' Approval") and (B) for such other purposes as may be
necessary or desirable, (ii) distribute to holders of Cryenco Common Stock the
Proxy Statement in accordance with applicable Federal and state law, and
Cryenco's Certificate of Incorporation and By-laws, (iii) recommend to the
holders of Cryenco Common Stock, through unanimous resolution of the Cryenco
Board of Directors, the adoption of this Agreement and such other matters as may
be submitted to such stockholders in connection with this Agreement and (iv)
cooperate and consult with Chart with respect to each of the foregoing matters.
The Board of Directors of Cryenco may fail to make such recommendation, or
withdraw, modify or change such recommendation in a manner adverse to the
interest of Chart, if the Board of Directors of Cryenco, after having consulted
with and considered the advice of outside counsel, has reasonably determined in
good faith that the making of such recommendation, or the failure to withdraw,
modify or change its recommendation, would constitute a breach of the fiduciary
duties of the members of such Board of Directors under applicable law.
(b) Access to Information and Confidentiality. Upon reasonable
notice and subject to applicable laws relating to the exchange of information
and the use of insider information,
(i) Cryenco shall, and shall cause each of its
subsidiaries to, afford to the officers, employees,
accountants, counsel and other representatives of Chart
access, during normal business hours during the period prior
to the Effective Time, to all its properties, books,
contracts, commitments and records, and to its officers,
employees, accountants, counsel and other representatives and,
during
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such period, Cryenco shall, and shall cause its respective
subsidiaries to, provide Chart with copies of any documents
filed by Cryenco under the Exchange Act and make available to
Chart such information concerning its business, properties and
personnel as Chart may reasonably request.
(ii) All information furnished pursuant to this
Section 5.3(b) and to Section 5.3(h) below or otherwise by
Cryenco or its representatives to Chart or its representatives
shall be treated as the sole property of Cryenco and, if the
Merger shall not occur, Chart and its representatives shall
return to Cryenco all of such written information and all
documents, notes, summaries or other materials containing,
reflecting or referring to, or derived from, such information.
Chart shall, and shall use its best efforts to cause its
representatives to, keep confidential all such information,
and shall not directly or indirectly use such information for
any competitive or other commercial purpose. The obligation to
keep such information confidential shall continue for three
years from the date the proposed Merger is abandoned and shall
not apply to any information which (i) (w) was already in
Chart's possession prior to the disclosure thereof by Cryenco;
(x) was then generally known to the public; (y) was disclosed
to Chart by a third party not bound by an obligation of
confidentiality or (z) becomes available to Chart from the
demonstrated independent research and/or development efforts
of Chart or its representatives, or (ii) is disclosed as
required by law. It is further agreed that, if in the absence
of a protective order or the receipt of a waiver hereunder,
Chart is nonetheless, in the reasonable opinion of its
counsel, compelled to disclose information concerning Cryenco
to any tribunal or governmental body or agency or else stand
liable for contempt or suffer other censure or penalty, Chart
may disclose such information to such tribunal or governmental
body or agency without liability hereunder.
(c) No Solicitations. Between the date hereof and the
Effective Time or earlier termination of this Agreement in accordance with its
terms, Cryenco shall not, nor shall it authorize or permit any of its officers,
directors or employees or any investment banker, financial advisor, attorney,
accountant or other representative retained by it to, solicit, encourage,
initiate or participate in discussions or negotiations with any third party
concerning the sale or merger of Cryenco or the sale or transfer of Cryenco's
assets (a "Third Party Transaction"), except that Cryenco may furnish
information about Cryenco and access thereto, in each case in response to
unsolicited requests therefor, to any third party pursuant to appropriate
confidentiality agreements, and may participate in discussions and negotiate
with such third party concerning a Third Party Transaction, if the Board of
Directors of Cryenco determines, in the exercise of its good faith judgment as
to its fiduciary duties to the Cryenco Stockholders and based upon advice of
counsel, that such action is required. Cryenco shall promptly inform Chart in
writing if it receives any proposals or requests for information from a third
party with respect to a Third Party Transaction.
(d) No Acquisitions. Between the date hereof and the Effective
Time or earlier termination of this Agreement in accordance with its terms,
Cryenco shall not acquire or
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agree to acquire by merging or consolidating with, or by purchasing an equity
interest in or a portion of the assets of, or by any other manner, any business
or any corporation, partnership, association or other business organization or
division thereof.
(e) Third-Party Consents. Prior to the Closing Date, Cryenco
shall use its reasonable best efforts to obtain all consents or approvals of
third parties set forth in Schedule 6.1 (b), and shall provide copies of all
such consents and approvals to Chart and CAC.
(f) Employee and Non-Employee Director Options
(i) Purchase of Non-Continuing Employee Options.
Within five days after receipt by Cryenco of written notice
from Chart as to those Cryenco employees whose employment will
not be continued after the Effective Time (the "Non-Continuing
Employees"), Cryenco shall use its reasonable best efforts to
cause such Non-Continuing Employees who hold options to
purchase shares of Cryenco Common Stock pursuant to any stock
option plan maintained or previously maintained by Cryenco for
the benefit of Cryenco employees (together with the options
described in Section 5.3(f)(iii) hereof, the "Cryenco
Options") that do not, by their terms, expire at or before the
Effective Time or are not by their terms, extinguished upon
termination of such Non-Continuing Employee's employment with
Cryenco to either (A) exercise such Cryenco Options prior to
the Closing, or (B) agree in writing to sell such Cryenco
Options to Chart at the Closing in exchange for cash equal to
the excess of $2.75 per share of Cryenco Common Stock issuable
upon exercise thereof over the exercise price for such Cryenco
Options.
(ii) Purchase or Exchange of Continuing Employee
Options. Prior to the Closing Date, Cryenco shall use its
reasonable best efforts to cause all Cryenco employees who are
not Non-Continuing Employees ("Continuing Employees") and who
hold unexercised Cryenco Options to agree in writing to either
(A) exchange, on the Closing Date, their Cryenco Options for
options to purchase Chart Common Stock, on the basis described
in Section 5.4(b)(ii) hereof, and pursuant to such exchange,
to surrender and waive any and all continuing rights with
respect to such Cryenco Options or (B) sell such Cryenco
Options to Chart at the Closing in exchange for cash equal to
the excess of $2.75 per share of Cryenco Common Stock issuable
upon exercise thereof over the exercise price for such Cryenco
Options.
(iii) Purchase of Non-Employee Director Stock
Options. Prior to the Closing, Cryenco shall use its
reasonable best efforts to cause all individuals who hold
unexercised options to purchase shares of Cryenco Common Stock
pursuant to Cryenco's 1993 Non-Employee Director Stock Option
Plan (each a "Non-Employee Director"), that do not by their
terms, expire at or before the Effective Time or are not by
their terms, extinguished upon termination of such
Non-Employee Director's position as a Director of Cryenco, to
agree in writing to sell
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such Cryenco Options to Chart at the Closing in exchange for
cash equal to the excess of $2.75 per share of Cryenco Common
Stock issuable upon exercise thereof over the exercise price
for such Cryenco Options.
(g) Cryenco Warrants. Prior to the Closing Date, Cryenco shall
use its reasonable best efforts to cause the holders of all warrants to purchase
any class of Cryenco capital stock (the "Cryenco Warrants") to agree in writing
either (i) to sell to Chart, on the Closing Date, any Cryenco Warrants having an
exercise price less than $2.75 per share for a cash payment per Warrant equal to
the excess of $2.75 over the exercise price for such Cryenco Warrants or (ii) to
exchange such Cryenco Warrants on the Closing Date for warrants to purchase
shares of Chart Common Stock on the basis described in Section 5.4(b)(iii)
hereof, and, pursuant to such exchange, to surrender and waive any and all
continuing rights with respect to such Cryenco Warrants.
(h) Monthly Financial Information. Not more than thirty (30)
days after the end of each month, Cryenco will deliver to Chart Cryenco's
unaudited consolidated balance sheet as of the end of such prior month and its
unaudited consolidated statement of income for such prior month, certified by
the Chief Financial Officer of Cryenco as having been prepared from the books
and records of Cryenco and in a manner consistent with past internal practice;
provided, however, that Cryenco's consolidated balance sheet and income
statement for the month of August, 1997 need not be certified by Cryenco's Chief
Financial Officer until after completion of the audit of Cryenco's financial
statements for the fiscal year ended August 31, 1997.
5.4 Additional Covenants of Chart. Chart agrees that:
(a) Indemnification and Insurance. Chart agrees that all
rights to indemnification and all limitations of liability existing in favor of
the employees, agents, directors and officers of Cryenco and its subsidiaries
(collectively, the "Indemnified Parties") to the extent provided for each such
employee, agent, director and officer in Cryenco's Certificate of Incorporation
or By-laws (or in the similar governing documents of any of Cryenco's
subsidiaries) or in any indemnification agreement for such individual which is
specifically listed on Schedule 6.1(o) to this Agreement, each as in effect as
of the date of this Agreement with respect to matters occurring on or prior to
the Effective Time shall survive the Merger and shall continue in full force and
effect without any amendment thereto for a period of six (6) years from the
Effective Time; provided, however, that all rights of indemnification in respect
of any claim asserted or made within such six-year period shall continue until
the final disposition of such claim; provided further, however, that nothing
contained in this Section 5.4(a) shall be deemed to preclude the liquidation,
consolidation or merger of Cryenco or any Cryenco subsidiary, in which case all
of such rights to indemnification and limitations on liability shall be deemed
to survive and continue notwithstanding any such liquidation, consolidation or
merger and shall constitute rights which may be asserted against Chart. Chart
shall use its reasonable best efforts to cause the persons serving as officers
and directors of Cryenco and of the Cryenco subsidiaries immediately prior to
the Effective Time to be covered for a period of six (6) years from the
Effective Time by the Directors and Officers Liability Insurance Policy
maintained by Cryenco
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(provided that Chart may substitute therefor policies of at least the same
coverage and amounts containing terms and conditions which are not less
advantageous to such directors and officers of Cryenco or its subsidiaries than
the terms and conditions of such existing policy) with respect to acts or
omissions occurring prior to the Effective Time which were committed by such
officers and directors in their capacity as such; provided, however, that Chart
shall not be obligated to make annual premium payments for such insurance to the
extent that such premiums exceed 125% of the premiums paid as of the date hereof
by Cryenco for such insurance ("Cryenco's Current Premium") and if such premiums
for such insurance would at any time exceed 125% of Cryenco's Current Premium
then Chart shall cause to be maintained policies of insurance which in Chart's
good faith determination provide the maximum coverage available at an annual
premium equal to 125% of Cryenco's Current Premium.
(b) Disposition of Cryenco Options and Cryenco Warrants.
(i) Purchase of Cryenco Options. At the Closing,
Chart shall purchase, from any holders of Cryenco Options who
elect to sell such options to Chart pursuant to Section
5.3(f), the Cryenco Options which are offered to it, in each
case in exchange for the cash price described in Section
5.3(f).
(ii) Continuing Employee Options Exchange. At the
Closing, Chart shall grant each Continuing Employee who holds
unexercised Cryenco Options, and who agrees to exchange such
options pursuant to Section 5.3(f)(ii), options to purchase
Chart Common Stock ("Chart Options"), having the following
terms: (A) the Chart Options shall be issued pursuant to
Chart's Key Employee Stock Option Plan; (B) the option term of
the each Chart Option shall be the remaining term of the
Cryenco Option exchanged therefor; (C) each Chart Option shall
be exercisable for the number of shares of Chart Common Stock
arrived at by multiplying the number of shares of Cryenco
Common Stock issuable upon exercise of the Cryenco Option
exchanged therefor by a fraction (the "Exchange Ratio")
determined by the following formula:
$2.75
Exchange Ratio = --------
"P"
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where "P" equals the average of the closing sales price of
Chart Common Stock on the New York Stock Exchange as reported
by the Wall Street Journal (or another mutually-agreeable
national publication) for the ten trading days preceding the
Closing Date; provided, however, that in no event shall the
Exchange Ratio be less than .11 nor more than .1375;
and (D) the exercise price of each Chart Option (per share of
Chart Common Stock issuable thereunder) shall be the exercise
price of the Cryenco Option exchanged therefor divided by the
Exchange Ratio.
(iii) Cryenco Warrants. At the Closing, Chart shall
(A) purchase any Cryenco Warrants having an exercise price
less than $2.75 per share for a cash payment per Warrant equal
to the excess of $2.75 over the exercise price for such
Cryenco Warrants, or (B) with respect to those Cryenco
Warrants for which the exercise price is greater than $2.75,
Chart shall grant the holder, in exchange for (and surrender
of) each such Warrant, a substitute warrant (the "Chart
Warrant") to purchase the number of shares of Chart Common
Stock arrived at by multiplying the number of shares of
Cryenco Common Stock issuable upon exercise of each Cryenco
Warrant by the Exchange Ratio. The exercise price of each
Chart Warrant (per share of Chart Common Stock issuable
thereunder) shall be the exercise price of the Cryenco Warrant
exchanged therefor divided by the Exchange Ratio. All other
terms of the Chart Warrant (including the term thereof) shall
remain substantially unchanged from those of the Cryenco
Warrant.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1 Representations and Warranties of Cryenco. Cryenco represents and
warrants to Chart, GTC and CAC as follows:
(a) Due Organization. Cryenco is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
has full corporate power and authority to own its properties and to carry on its
business as it is now being conducted, is duly qualified to do business and is
in good standing in all jurisdictions in which it is required to be so
qualified, except where the failure to so qualify or be in good standing would
not, in the aggregate, have a material adverse effect upon the business,
financial condition, results of operations or prospects of Cryenco and its
subsidiaries, taken as a whole (a "Cryenco Material Adverse Effect"), and has
received all necessary authorizations, consents and approvals of governmental
authorities material to the ownership of its properties and assets and to the
conduct of its business.
(b) Power and Authority; No Conflicts. Cryenco has full power
and authority (corporate or otherwise) to enter into and carry out the terms of
this Agreement subject to stockholder approval. The execution and delivery by
Cryenco of this Agreement and the other documents and instruments to be executed
and delivered by Cryenco pursuant hereto and thereto
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and the consummation of the transactions contemplated hereby and thereby by
Cryenco have been duly authorized by the unanimous vote of the Board of
Directors of Cryenco. This Agreement has been duly and validly executed by
Cryenco, and will, when executed and delivered, along with each other document
and instrument to be executed and delivered by Cryenco pursuant hereto,
constitute, a valid and binding agreement of Cryenco enforceable against it in
accordance with their respective terms subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights generally and except to
the extent that the enforceability of rights and remedies may be limited by
general principles of equity. The execution and delivery of this Agreement does
not, and, subject to any requisite governmental or other consents or approvals,
the consummation of the transactions contemplated hereby will not (i) violate
any provision of the Certificate of Incorporation or the By-laws of Cryenco, in
each case as amended, (ii) violate or conflict with any law, ordinance, rule,
regulation, order, judgment or decree to which Cryenco or any of its
subsidiaries is subject or by which Cryenco or any of its subsidiaries is bound,
or (iii) violate or conflict with or constitute a material default (or an event
which, with notice or lapse of time, or both, would constitute a material
default) under, or will result in the termination of, or accelerate the
performance required by, or result in the creation of any lien, security
interest, charge or encumbrance upon any of the properties or assets under any
term or provision of any material contract, commitment, understanding,
arrangement, agreement or restriction of any kind or character to which Cryenco
or any of its subsidiaries is a party or by which Cryenco or any of its
subsidiaries or any of their respective assets or properties may be bound or
affected. Except as set forth on Schedule 6.1(b), no consent, approval,
authorization or action by any federal, state, local or foreign governmental
agency, instrumentality, commission, authority, board or body (collectively,
"Governmental Agency") or any other third party is required in connection with
the execution and delivery by Cryenco of this Agreement and the other documents
and instruments to be executed and delivered by Cryenco pursuant hereto or the
consummation by Cryenco of the transactions contemplated herein or therein.
(c) Capital Structure. Cryenco's authorized, issued,
outstanding and reserved capital stock is, as of March 31, 1997, as set forth on
Schedule 6.1(c), and all of the outstanding shares of its capital stock have
been duly authorized and validly issued and are fully paid and nonassessable and
free from preemptive rights. There are no outstanding options, warrants,
convertible securities, subscriptions or other rights or agreements providing
for the issuance or delivery of any additional shares of capital stock of
Cryenco, except as set forth on Schedule 6.1(c). Schedule 6.1(c) lists all of
the Cryenco Options and the Cryenco Warrants and also sets forth, in the case of
each item listed thereon, the identity of the record holder thereof (or
beneficial holder, if known) the number of shares of Cryenco capital stock
issuable thereunder, the expiration date (if any) thereof and the exercise price
thereof.
(d) Subsidiaries. (i) Except as set forth on Schedule 6.1(d),
Cryenco has no subsidiaries, either wholly or partially owned. Cryenco has full
power and authority to transfer all right, title and interest in and to such
shares without the consent of any other person, and such shares are free and
clear of all liens, equities, encumbrances and claims of every kind. Each
subsidiary of Cryenco (i) is duly organized and validly existing as a
corporation under the laws of its jurisdiction of organization (ii) is duly
qualified to do business and in good standing in all
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jurisdictions where its ownership or leasing of property or the conduct of its
business requires it to be so qualified and in which the failure to be so
qualified would have or reasonably be expected to have a Cryenco Material
Adverse Effect and (iii) has all requisite corporate power and authority to own
or lease its properties and assets and to carry on its business as now
conducted.
(e) SEC Documents. Cryenco has made available to Chart a true
and complete copy of each report, schedule, registration statement and
definitive proxy statement filed by Cryenco with the SEC since August 31, 1995
(as such documents have since the time of their filing been amended, the
"Cryenco SEC Documents") which are all of the documents that Cryenco was
required to file with the SEC since such date. As of their respective dates, the
Cryenco SEC Documents complied in all material respects with the requirements of
the Securities Act or the Exchange Act, as the case may be, and the rules and
regulations of the SEC thereunder applicable to such Cryenco SEC Documents, and
none of the Cryenco SEC Documents at the time they were filed with the SEC (or
amended) contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Cryenco has previously made available to Chart copies of (i) the
consolidated balance sheets of Cryenco and its subsidiaries, as of August 31,
for the fiscal years 1995 and 1996 and the related consolidated statements of
operations, stockholders equity and cash flows for the fiscal years 1994 through
1996 inclusive as reported in Cryenco's Annual Report on Form 10-K for the
fiscal year ended August 31, 1996 filed with the SEC under the Exchange Act, in
each case accompanied by the audit report of Ernst & Young LLP, independent
auditors with respect to Cryenco and (ii) the unaudited consolidated balance
sheet of Cryenco and its subsidiaries as of February 28, 1996 and February 28,
1997 and the related unaudited consolidated statements of operations,
stockholders equity and cash flows for the periods then ended as reported in
Cryenco's Quarterly Report on Form 10-Q for the period ended February 28, 1997
filed with the SEC under the Exchange Act. The August 31, 1996 consolidated
balance sheet of Cryenco (including the related notes) fairly presents the
consolidated financial position of Cryenco and its subsidiaries as of the date
thereof and the other financial statements referred to in this Section 6.1(e)
(including the related notes, where applicable) fairly present (subject in the
case of the unaudited statements to recurring audit adjustments normal in nature
and amount), and the Cryenco financial statements hereafter filed by Cryenco
with the SEC prior to the Effective Time will fairly present (subject in the
case of the unaudited statements to recurring audit adjustments normal in nature
and amount), the results of the consolidated operations and changes in
stockholders equity and consolidated financial position of Cryenco and its
subsidiaries for the respective fiscal periods or as of the respective dates
therein set forth. Each of such statements (including the related notes, where
applicable) complies, and the Cryenco financial statements hereafter filed by
Cryenco with the SEC prior to the Effective Time will comply, in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto and each of such statements
(including the related notes, where applicable) has been, and the Cryenco
financial statements hereafter filed by Cryenco with the SEC prior to the
Effective Time will be prepared in accordance with generally accepted accounting
principles ("GAAP") consistently applied during the periods involved, except in
each case as indicated in such statements or in the notes thereto or, in the
case of
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unaudited statements, as permitted by Form 10-Q. The books and records of
Cryenco and its subsidiaries have been and are being maintained in all material
respects in accordance with GAAP and any other applicable legal and accounting
requirements and reflect only actual transactions. Except as disclosed on
Schedule 6.1 (e), to the best of its knowledge, Cryenco is not the subject of
any review, study, audit, examination, inquiry or other investigation by the SEC
("SEC Investigation"), nor, to the best knowledge of Cryenco, is any such SEC
Investigation pending or threatened.
(f) Vote Required. The affirmative vote of the holders of a
majority of the shares of Cryenco Common Stock issued and outstanding on the
record date for the Cryenco Special Meeting is the only vote of the holders of
Cryenco capital stock necessary to approve this Agreement and the Merger.
(g) Title to Assets. Except as set forth on Schedule 6.1 (g),
Cryenco and each subsidiary of Cryenco, has good, marketable and valid title in
and to all of its assets, including all real, personal and intangible property,
and except as reflected on Schedule 6.1(g), Cryenco and each subsidiary of
Cryenco holds its assets free and clear of any mortgage, conditional sale
agreement, title retention agreement, security interest, lease, pledge,
hypothecation, lien or other encumbrance.
(h) Condition of Assets. All of the assets (whether owned or
leased) that are necessary for the conduct of the business of Cryenco or any
subsidiary of Cryenco are in normal operating condition, free from defects other
than such defects as do not materially interfere with the continued use thereof
in normal operations, except as set forth on Schedule 6.1 (h) .
(i) Accounts Receivable and Accounts Payable. Cryenco has
delivered to Chart and CAC an accurate aging schedule of all of the accounts
receivable reflected on the books of Cryenco or any subsidiary of Cryenco, as of
March 31, 1997. Any account receivable due from any affiliate of Cryenco or any
affiliate of any subsidiary of Cryenco shall be paid in full in cash on or prior
to the Closing Date. Any account payable due to any affiliate of Cryenco or any
affiliate of any subsidiary of Cryenco and disclosed on Schedule 6.1(o) shall be
paid in full in cash on or prior to the Closing Date.
(j) Insurance. Cryenco (on its own behalf and on behalf of its
subsidiaries) (a) maintains insurance policies with licensed insurance carriers
on such assets, properties and businesses and against such risks as is customary
for companies engaged in its business, or (b) has reserved on its financial
statements sufficient funds to cover all losses known to it arising from such
risks. Schedule 6.1(j) sets forth a list and brief description (specifying the
insurer and describing each pending claim thereunder) of all policies, binders
or reserves of fire, liability, product liability, workers' compensation,
vehicular and other insurance or self-insurance held by or on behalf of Cryenco
or any subsidiary of Cryenco. All such policies are in full force and effect and
insure against risks and liabilities to an extent and in a manner customary in
the business in which Cryenco and its subsidiaries operate. Except for claims
identified on Schedule 6.1(j), there are no outstanding unpaid claims under any
such policy, binder or reserve. Except as specifically set forth on Schedule
6.1(j), there will be no liability of Cryenco or any Cryenco
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<PAGE> 25
subsidiary, as of the Closing Date, under any such insurance policy or ancillary
agreement with respect thereto in the nature of a retroactive rate adjustment,
loss sharing arrangement or other actual or contingent liability arising wholly
or partially out of events occurring prior to the Closing Date. Cryenco has
received no notice of cancellation or nonrenewal of any such policy or binder.
There is no inaccuracy in any application for such policies or binders, or any
failure to pay premiums due. Cryenco has not received any notice from any of its
insurance carriers that any insurance premiums will be materially increased in
the future or that any insurance coverage listed on Schedule 6.1(j) will not be
available in the future on substantially the same terms as now in effect.
(k) Dividends and Distributions. From August 31, 1996 to the
date hereof, Cryenco has not declared or paid any dividends on any shares of its
capital stock, nor has it made any other payments or distributions thereon to
its stockholders. All dividends declared by Cryenco prior to August 31, 1996
have been fully paid or Cryenco has fully and properly reserved against the
payment of such dividends on its audited, consolidated balance sheet as of
August 31, 1996.
(l) Cryenco Data. Cryenco has made available to Chart, with
respect to Cryenco and each Cryenco subsidiary, all corporate minutes (other
than Directors' minutes pertaining to the Merger), charter and by-laws, books
and records, all material contracts, all product warranties, all loan
documentation, all notes, all leases, a list of all accounts receivable,
evidence of all bank accounts, an accurate and complete list of each insurance
policy currently providing coverage for the real and personal property owned,
operated or leased together with copies of such policies, information regarding
employee compensation and benefit plans, a list of all outstanding workers'
compensation, unemployment and other claims known to Cryenco as of the date
hereof, all licenses and permits that Cryenco has with respect to its
operations, and all outstanding or existing citations, complaints or reports
relating to environmental, health or safety laws or regulations (collectively,
the "Cryenco Data"). Cryenco acknowledges that Chart and CAC have relied on the
Cryenco Data in deciding to execute this Agreement and consummate the
transactions contemplated hereby.
(m) Undisclosed Liabilities. Except (i) for those liabilities
that are fully reflected or reserved against on the consolidated balance sheet
of Cryenco included in the Cryenco Form 10-Q for the quarter ended February 28,
1997, (ii) for liabilities incurred in the ordinary course of business
consistent with past practice since February 28, 1997 and (iii) as set forth in
Schedule 6.1(m), neither Cryenco nor any of its subsidiaries has incurred any
liability of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether due or to become due) that, either alone or when combined
with all similar liabilities, has had or would reasonably be expected to have a
Cryenco Material Adverse Effect.
(n) Investigation or Litigation. Except as set forth on
Schedule 6.1(n), there is no investigation or review pending or to the best
knowledge of Cryenco threatened by any Governmental Agency with respect to
Cryenco or any Cryenco subsidiary including without limitation, investigations
or reviews relating to (i) any product alleged to have been sold by Cryenco or
any Cryenco subsidiary, and alleged to have been defective or improperly
designed
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or manufactured, (ii) hazardous substances, (iii) pollution, (iv) the
environment, or (v) workers' compensation; nor has any Governmental Agency
indicated in writing to Cryenco or any Cryenco subsidiary an intention to
conduct any such investigation or review; nor, to the knowledge of Cryenco, is
there any valid basis for any such investigation or review. Except as set forth
in Schedule 6.1 (n), there is no claim, action, suit or proceeding pending
before or, to the best knowledge of Cryenco, threatened against or affecting
Cryenco or any Cryenco subsidiary at law or in equity by, any Governmental
Agency or arbitrator, including, without limitation, claims, actions, suits or
proceedings relating to (i) any product alleged to have been sold by Cryenco or
any Cryenco subsidiary, and alleged to have been defective or improperly
designed or manufactured, (ii) hazardous substances, (iii) pollution, (iv) the
environment, or (v) workers' compensation, nor is there, to the best knowledge
of Cryenco, any valid basis for any such claim, action, suit or proceeding.
(o) Certain Agreements. Except as disclosed in the Cryenco SEC
Documents filed prior to the date of this Agreement or in Schedule 6.1 (o) as of
the date of this Agreement, neither Cryenco nor any Cryenco subsidiary is a
party to any oral or written (i) consulting agreement not terminable on 60 days'
or less notice, (ii) agreement with any Director, executive officer, key
employee or affiliate of Cryenco or any Cryenco subsidiary, or (iii) agreement
or plan, including any stock option plan, stock appreciation rights plan, any of
the Plans (as defined in Section 6.1 (p)), restricted stock plan or stock
purchase plan, any of the benefits of which will be increased, or the vesting of
the benefits of which will be accelerated, by the occurrence of any of the
transactions contemplated by this Agreement or the value of any of the benefits
of which will be calculated on the basis of any of the transactions contemplated
by this Agreement.
(p) Employee Benefits.
(i) Schedule 6.1 (p) contains a true and complete
list of each bonus, deferred compensation, incentive
compensation, stock purchase, stock option, severance or
termination pay, hospitalization or other medical, life or
other insurance, supplemental unemployment benefits,
profit-sharing, pension, retirement or other employee benefit
plan, program, practice, agreement or arrangement, including,
without limitation, each "employee benefit plan" as defined in
section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), sponsored, maintained, contributed
to or required to be contributed to by Cryenco, any Cryenco
subsidiary or any trade or business, whether or not
incorporated (together with the Cryenco subsidiaries, an
"ERISA Affiliate"), which together with Cryenco or any Cryenco
subsidiary would be deemed a "single employer" within the
meaning of section 4001 of ERISA, for the benefit of current
or former employees or directors of Cryenco or any Cryenco
subsidiary (the "Plans"). Cryenco has delivered or made
available to Chart true and complete copies of all documents,
as they may have been amended to the date hereof, embodying or
relating to the Plans.
(ii) Except as set forth in Schedule 6.1(p), neither
Cryenco nor any Cryenco subsidiaries maintains any Plans that
are intended to qualify under
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sections 401 (a) or 501 (a) of the Code. Neither Cryenco nor
any current or former ERISA Affiliate sponsored, maintained,
contributed to or was required to contribute to, during the
six year period ending on the Closing Date, any Plan subject
to Title IV of ERISA or any "multiemployer plan" within the
meaning of section 3 (37) of ERISA or any multiemployer or
multiple employer welfare benefit plan.
(iii) Each of the Plans has been operated and
administered in all material respects in accordance with
applicable laws, including but not limited to ERISA and the
Code. To Cryenco's knowledge, no reportable event within the
meaning of section 403(b) of ERISA (for which the reporting
requirements have not been waived) or prohibited transaction
within the meaning of section 406 of ERISA or section 4975(c)
of the Code has occurred with respect to any Plan, no civil
penalty has been assessed pursuant to sections 409 or 502(i)
of ERISA, and no tax has been imposed pursuant to sections
4975 or 4976 of the Code.
(iv) There are no pending, or to the best knowledge
of Cryenco, threatened or anticipated claims (other than
routine claims for benefits) by, on behalf of or against any
of the Plans or any trusts related thereto.
(v) Except as specifically set forth on Schedule 6.1
(p), no Plan provides benefits, including without limitation
death or medical benefits (whether or not insured), with
respect to current or former employees or directors of the
business of Cryenco or any ERISA Affiliate beyond their
retirement or other termination of service other than coverage
mandated by applicable law or deferred compensation benefits
accrued as liabilities in compliance with applicable Financial
Accounting Standards Board requirements on the books of
Cryenco.
(vi) Except as specifically set forth in Schedule
6.1(p), with respect to each Plan that is funded wholly or
partially through an insurance policy, there will be no
liability of Cryenco or any ERISA Affiliate, as of the Closing
Date, under any such insurance policy or ancillary agreement
with respect to such insurance policy in the nature of a
retroactive rate adjustment, loss sharing arrangement or other
actual or contingent liability arising wholly or partially out
of events occurring prior to the Closing Date.
(q) Labor Matters. Except as set forth on Schedule 6.1 (q),
neither Cryenco nor any Cryenco subsidiary has entered into any collective
bargaining agreements or any other agreements with any labor organization or any
other person or group claiming to represent or bargain collectively for any of
its employees. Cryenco has delivered or made available to Chart true and correct
copies of all of the agreements described on Schedule 6.1(q). There are no
unfair labor practice charges, lawsuits, grievances or administrative charges
pending or to the best knowledge of Cryenco threatened, concerning or affecting
Cryenco or any Cryenco subsidiary. Neither Cryenco nor any Cryenco subsidiary
has received any written notice nor has there been any proceeding or
adjudication questioning whether or alleging or determining that
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Cryenco or any Cryenco subsidiary is not in compliance, in all material
respects, with all federal, state and local laws and regulations with respect to
employment, employment practices and terms and conditions of employment. There
is no work stoppage, strike, slowdown or adverse job action of any form by any
persons or labor organizations occurring or, to the knowledge of Cryenco,
threatened against Cryenco or any Cryenco subsidiary.
(r) Taxes. Cryenco has (directly or through one or more of its
subsidiaries)
(i) timely filed all tax returns, schedules,
declarations, and tax-related documents including, without
limitation, all Forms 5500 pertaining to the Plans
(collectively, "Returns") required to be filed by any
jurisdictions to which Cryenco or any Cryenco subsidiary is or
has been subject,
(ii) timely paid in full any taxes, interest and
penalties with respect to Returns, and timely made any
deposits of taxes required by taxing jurisdictions,
(iii) fully accrued on its books an amount
sufficient to pay all taxes not yet due but related to
operations through the Closing Date, and
(iv) otherwise satisfied, in all material respects,
all legal requirements applicable to Cryenco or any Cryenco
subsidiary with respect to all aforementioned obligations to
taxing jurisdictions. All tax returns filed by Cryenco or any
Cryenco subsidiary accurately reflect in all material respects
all income, expenses, deductions, credits and loss carryovers
and the taxes due and are otherwise accurate and complete in
all material respects. Except for consequences arising from
the transactions contemplated by this Agreement, to Cryenco's
knowledge, there have been no events that would impair the
full availability of the net operating losses available
against future state taxes in the State of Colorado as
reflected on Cryenco's audited consolidated balance sheet as
of August 31, 1996. Cryenco has delivered to Chart true and
complete copies of all federal and state income and franchise
tax returns for each of the taxable years ended August 31,
1994 through August 31, 1996, inclusive. The most recent
period for which an assessment can no longer be made by the
IRS with respect to Cryenco's federal income tax is for the
fiscal year ended August 31, 1993. Cryenco has no knowledge
that an audit of any of the federal income tax returns of
Cryenco is in progress and has no reason to believe that any
such audit is contemplated. To Cryenco's knowledge, there are
no other claims asserted for (or to the knowledge of Cryenco
any substantial basis therefor), taxes or assessments. For
purposes of this Section, "tax" and "taxes" (when not modified
by other words such as "income" or "franchise") shall include
all income, gross receipts, franchise, payroll, excise, real
and personal property, and other taxes imposed by any foreign,
federal, state, municipal, local, or other governmental
agency, including assessments in the nature of taxes.
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(s) Absence of Certain Changes. Except as disclosed on
Schedule 6.1 (s), since February 28, 1997, neither Cryenco nor any Cryenco
subsidiary has suffered any Cryenco Material Adverse Effect.
(t) Legal Compliance. Cryenco and each Cryenco subsidiary has
complied in all material respects with all applicable laws, rules, regulations,
and ordinances of any Governmental Agency having jurisdiction, any trademark,
tradename or copyright rules and regulations, and any zoning, occupational
safety or environmental protection laws or any laws relating to the employment
of labor. Neither Cryenco nor any Cryenco subsidiary is in violation of, or in
default under, any terms or provisions of any material mortgage, indenture,
security agreement, lease, license, contract, agreement, instrument, order,
arbitration award, judgment, injunction or decree. Neither Cryenco nor any
Cryenco subsidiary has received any written notice nor to Cryenco's knowledge
has there been any proceeding or adjudication questioning whether or alleging or
determining that the business of Cryenco or any Cryenco subsidiary is or has
been conducted in violation of any law, ordinance, regulation, order, decree,
judgment or injunction. Neither Cryenco nor any Cryenco subsidiary has received
any written notice nor has there been any proceeding or adjudication questioning
whether or alleging or determining it has not obtained all permits, licenses and
other authorizations which relate to its assets or business. Neither Cryenco nor
any Cryenco subsidiary has received any written notice nor has there been any
proceeding or adjudication questioning whether or alleging or determining that
it is not in compliance in all material respects with all material terms and
conditions of such permits, licenses and authorizations.
(u) Environmental Protection.
(i) Except as set forth on Schedule 6.1(u), Cryenco
and each Cryenco subsidiary is in compliance with all
Environmental Laws (as hereinafter defined) applicable to the
business of Cryenco and each Cryenco subsidiary, which
compliance includes, but is not limited to, the possession by
Cryenco and each Cryenco subsidiary of all permits and other
governmental authorizations required under applicable
Environmental Laws, and compliance with the terms and
conditions thereof. Neither Cryenco nor any Cryenco subsidiary
has received any written communication, whether from a
Governmental Agency, citizens group, employee or otherwise,
that alleges that the business of Cryenco or any Cryenco
subsidiary is not in such compliance. To the best knowledge of
Cryenco, there are no circumstances that may prevent or
interfere with such compliance in the future. All permits and
other governmental authorizations currently held by Cryenco
and each Cryenco subsidiary pursuant to the Environmental Laws
are identified on Schedule 6.1(u).
(ii) Except as set forth in Schedule 6.1 (u), there
is no Environmental Claim pending or, to the best knowledge of
Cryenco, threatened against Cryenco or any Cryenco subsidiary
or against any person or entity whose liability for any
Environmental Claims Cryenco or any Cryenco subsidiary has or
may have retained or assumed either contractually or by
operation of law.
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(iii) Cryenco has disclosed to Chart all outside
consultants' reports, internal memoranda, legal documents
involving third parties, and any other information, written or
otherwise, in the possession of Cryenco or any Cryenco
subsidiary that relates to the release, emission, discharge or
disposal of any Materials of Environmental Concern (as defined
below).
(iv) Without in any way limiting the generality of
the foregoing, (A) all on-site and off-site locations where
Cryenco or any Cryenco subsidiary has stored, disposed or
arranged for the disposal of Materials of Environmental
Concern since August 31, 1989, are identified in Schedule 6.1
(u), (B) all existing underground storage tanks and all areas
impacted by former underground storage tanks, and the capacity
and contents of such existing tanks located on property owned
or leased by Cryenco or any Cryenco subsidiary are identified
in Schedule 6.1 (u) and (C) neither Cryenco nor any Cryenco
subsidiary has any liability or potential liability for
remediation cost at any present or former site where its
business is or was conducted which is reasonably expected to
exceed $100,000 in the aggregate.
(v) "Environmental Claim" means any claim, action,
cause of action, investigation or notice (written or oral)
("Claim") by any person or entity alleging potential liability
(including, without limitation, potential liability for
investigatory costs, cleanup costs, governmental response
costs, natural resources damages, property damages, personal
injuries, or penalties) arising out of, based on or resulting
from (A) the presence, or release into the environment of any
Materials of Environmental Concern at any location, whether or
not owned by Cryenco or any Cryenco subsidiary or (B)
circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law by Cryenco or any Cryenco
subsidiary; provided, however, that no such Claim, or group of
Claims arising from a single activity or incident, shall be
considered to be an Environmental Claim under this provision
unless the value of such Claim or group of Claims is in excess
of One Hundred Thousand Dollars ($100,000).
(vi) "Environmental Laws" means all federal, state,
local and foreign laws and regulations relating to pollution
or protection of human health or the environment (including,
without limitation, ambient air, surface water, ground water,
land surface or subsurface strata), including, without
limitation, laws and regulations relating to emissions,
discharges, releases or threatened releases of Materials of
Environmental Concern, or otherwise relating to the
manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of Materials of
Environmental Concern.
(vii) "Materials of Environmental Concern" means
chemicals, pollutants, contaminants, wastes, hazardous or
toxic substances, petroleum and petroleum products.
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<PAGE> 31
(v) Patents, Copyrights, Trademarks, Trade Names etc. Schedule
6.1 (v) hereto contains an accurate and complete list of all material patents,
patent applications, trademark registrations, trademark applications, service
marks, trade names and assumed names used by Cryenco or any Cryenco subsidiary
in its business which are presently owned or held by Cryenco or any Cryenco
subsidiary or under which it owns or holds any license or other interest. Such
items of intellectual property constitute all such items used by Cryenco or any
Cryenco subsidiary in its business. Neither Cryenco nor any Cryenco subsidiary
has received written notice nor to Cryenco's knowledge has there been any
proceeding or adjudication questioning whether or alleging or determining that
the use thereof by Cryenco or any Cryenco subsidiary infringes on or conflicts
with any existing patents, trademarks or copyrights or any other rights of any
person. Neither Cryenco nor any Cryenco subsidiary has received any written
notice of any material claim of a third party to the use of any such names.
Cryenco and its subsidiaries have the right to use such patents, trademarks,
trade names and copyrights in the business in which they are currently being
used and the consummation of the transactions contemplated hereby will not alter
or impair any such rights. Neither Cryenco nor any Cryenco subsidiary has
received any written notice nor to Cryenco's knowledge has there been any
material proceeding or adjudication questioning whether or alleging or
determining that any services provided or products manufactured or sold by
Cryenco or any Cryenco subsidiary nor any patents, formulae, processes,
know-how, trade secrets, trademarks, trade names, assumed names, copyrights or
designations used by Cryenco or any Cryenco subsidiary in its business, infringe
on any existing patents, trademarks or copyrights, or any other rights of any
person or corporate entity. To the knowledge of Cryenco, any license included in
the intellectual property of Cryenco or any Cryenco subsidiary constitutes a
valid and binding agreement of the other party thereto enforceable in accordance
with its terms.
(w) Contracts. Each contract and commitment (whether written
or oral) that individually involves potential future payments by or to Cryenco
or any Cryenco subsidiary of $100,000 or more is disclosed on Schedule 6.1(w)
and copies of such written contracts or commitments have been provided to Chart.
Except as set forth on such schedule, neither Cryenco nor any Cryenco
subsidiary, nor has been during the past three years, a partner in any
partnership or a party to any joint venture.
(x) Full Disclosure. There is no fact or set of circumstances
known to Cryenco, which has not been disclosed to Chart in writing, that has
caused since August 31, 1996, or would reasonably be anticipated to result in, a
Cryenco Material Adverse Effect.
(y) Brokers or Finders. Neither Cryenco nor any Cryenco
subsidiary has incurred or will incur, any liability for any brokerage fees,
commissions, finders' fees or similar fees or expenses in connection with this
Agreement or the transactions contemplated hereby.
6.2 Representations and Warranties of Chart, GTC and CAC. Chart, GTC
and CAC represent and warrant to Cryenco as follows:
(a) Due Organization. Chart is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
has full corporate power and
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<PAGE> 32
authority to own its properties and to carry on its business as it is now being
conducted, is duly qualified to do business and is in good standing in all
jurisdictions in which it is required to be so qualified, except where the
failure to so qualify or be in good standing would not, in the aggregate, have a
material adverse effect upon the business, financial condition, results of
operations or prospects of Chart and its subsidiaries, taken as a whole (a
"Chart Material Adverse Effect"), and has received all necessary authorizations,
consents and approvals of governmental authorities material to the ownership of
its properties and assets and to the conduct of its business.
(b) Power and Authority, No Conflicts. Each of Chart, GTC and
CAC has full power and authority (corporate or otherwise) to enter into and
carry out the terms of this Agreement. The execution and delivery of this
Agreement and the other documents and instruments to be executed and delivered
by Chart, GTC and CAC pursuant hereto and thereto and the consummation of the
transactions contemplated hereby and thereby by Chart, GTC and CAC have been
duly authorized by the Boards of Directors of Chart, GTC and CAC, and by GTC as
the sole stockholder of CAC. This Agreement has been duly and validly executed
and delivered by each of Chart, GTC and CAC and constitutes, when executed and
delivered, along with the other documents and instruments to be executed and
delivered by each of Chart, GTC and CAC pursuant hereto, valid and binding
agreements of Chart, GTC and CAC, enforceable against each of Chart, GTC and CAC
in accordance with their respective terms subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights generally and except to
the extent that the enforceability of rights and remedies may be limited by
general principles of equity. The execution and delivery of this Agreement does
not, and, subject to any requisite governmental or other consents or approvals
the consummation of the transactions contemplated hereby and thereby will not
(i) violate any provision of the Certificate of Incorporation or the by-laws of
each of Chart, GTC and CAC, (ii) violate or conflict with any law, ordinance,
rule, regulation, order, judgment or decree to which either Chart, GTC or CAC is
subject or by which either Chart, GTC or CAC is bound, or (iii) violate or
conflict with or constitute a default (or an event which, with notice or lapse
of time, or both, would constitute a default) under, or will result in the
termination of, or accelerate the performance required by, or result in the
creation of any lien, security interest, charge or encumbrance upon any of the
properties or the assets under, any term or provision of any contract,
commitment, understanding, arrangement, agreement or restriction of any kind or
character to which Chart, GTC or CAC is a party or by which either of them or
any of their assets or properties may be bound or affected. Except as set forth
in Schedule 6.2(b), no consent, approval, authorization or action by any
Governmental Agency or any other third party is required in connection with the
execution and delivery by each of Chart, GTC and CAC of this Agreement and the
other documents and instruments to be executed and delivered by each of Chart,
GTC and CAC pursuant hereto or the consummation by each of Chart, GTC and CAC of
the transactions contemplated herein or therein.
(c) Financing of the Merger. Chart, GTC and CAC have all
funds, or appropriate commitments for funds, necessary for the exchange of all
outstanding shares of Cryenco Common Stock and Cryenco Preferred Stock pursuant
to the Merger.
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(d) Brokers and Finders. Neither Chart nor GTC nor CAC has
employed any broker or finder or incurred any liability for any brokerage fees,
commissions, finders' fees or similar fees or expenses in connection with this
Agreement or the transactions contemplated hereby.
(e) Financial Condition. Chart's audited, consolidated balance
sheet, included in its Annual Report on Form 10-K for the fiscal year ended
December 31, 1996, was prepared in accordance with GAAP, and fairly presents the
financial position of Chart as of the date thereof. Since the date of said
balance sheet, no change to Chart's financial condition has occurred which would
reasonably be anticipated to adversely affect its ability to make the payments
necessary to consummate the Merger, as contemplated by this Agreement.
ARTICLE VII
CONDITIONS
7.1 Conditions Precedent to the Obligations of All Parties. The
obligations of each of Cryenco, Chart, GTC and CAC under this Agreement are
subject to and shall be conditional upon the satisfaction of each of the
following conditions prior to the Closing Date:
(a) Stockholder Approval. This Agreement shall have been
approved and adopted by the affirmative vote of the holders of a majority of the
issued and outstanding shares of Cryenco Common Stock.
(b) Governmental Approvals. Cryenco and Chart shall have made
all filings with, and all relevant waiting periods shall have expired (including
all filings required to be made under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 and waiting period in connection therewith), and given
all notices to and obtained all necessary consents, authorizations and approvals
from, all Governmental Agencies which are required to consummate the
transactions contemplated in this Agreement.
(c) No Injunctions or Restraints. No temporary restraining
order, preliminary or permanent injunction or other order, restraint or
prohibition shall have been issued by any court of competent jurisdiction
preventing the consummation of the transactions contemplated by this Agreement
(each party agreeing to use its reasonable best efforts, including appeals to
higher courts, to have any such order, injunction, legal restraint or
prohibition set aside or lifted), and no action shall have been taken, and no
statute, rule or regulation shall have been enacted, by any state or Federal
government or Governmental Agency that would prevent the consummation of the
transactions contemplated by this Agreement.
7.2 Conditions Precedent to the Obligations of Cryenco. The obligations
of Cryenco under this Agreement are subject to and shall be conditional upon the
satisfaction, or waiver (in whole or in part) by Cryenco, of each of the
following conditions:
(a) Representations and Warranties True. The representations
and warranties of Chart, GTC and CAC contained herein shall have been true and
correct in all material respects on and as of the date of this Agreement, and
shall be true and correct in all material respects on
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<PAGE> 34
and as of the Closing Date as if those representations and warranties were made
on and as of the Closing Date, except for changes permitted by the terms of this
Agreement and except insofar as any of those representations and warranties
relate solely to a particular date or period, in which case they shall be true
and correct in all material respects on and as of the Closing Date with respect
to such date or period.
(b) Performance of Obligations and Agreements. Chart, GTC and
CAC shall each have performed, in all material respects, their obligations and
agreements contained in this Agreement to be performed or complied with by them
on or before the Closing Date.
(c) Resolutions. Each of Chart, GTC and CAC shall have
delivered to Cryenco copies of the resolutions of its Board of Directors
authorizing and approving the execution of this Agreement and the consummation
of the transactions contemplated hereby, certified as true and correct on the
Closing Date by its Secretary or an Assistant Secretary.
(d) Officers' Certificates. Each of Chart, GTC and CAC shall
have delivered to Cryenco a certificate dated on and as of the Closing Date and
signed by its Chief Executive Officer and Chief Financial Officer to the effect
that the conditions set forth in Sections 7.2(a) and 7.2(b) have been satisfied.
7.3 Conditions Precedent to the Obligations of Chart, GTC and CAC. The
obligations of Chart, GTC and CAC under this Agreement are subject to and shall
be conditional upon the satisfaction, or waiver (in whole or in part) by Chart,
GTC and CAC of each of the following conditions:
(a) Representations and Warranties True. The representations
and warranties of Cryenco contained herein shall have been true and correct in
all material respects on and as of the date of this Agreement, and shall be true
and correct in all material respects on and as of the Closing Date as if those
representations and warranties were made on and as of the Closing Date, except
for changes permitted by the terms of this Agreement and except insofar as any
of those representations and warranties relate solely to a particular date or
period, in which case they shall be true and correct in all material respects on
and as of the Closing Date with respect to such date or period.
(b) Performance of Obligations and Agreements. Cryenco shall
have performed, in all material respects, its obligations and agreements
contained in this Agreement to be performed or complied with by it on or before
the Closing Date.
(c) Resolutions. Cryenco shall have delivered to Chart copies
of the resolutions of its Board of Directors and Stockholders, authorizing and
approving the execution of this Agreement and the consummation of the
transactions contemplated hereby, certified as true and correct on the Closing
Date by its Secretary or an Assistant Secretary.
(d) Officer's Certificate. Cryenco shall have delivered to
Chart a certificate dated on and as of the Closing Date and signed by the Chief
Executive Officer and the Chief
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<PAGE> 35
Financial Officer of Cryenco to the effect that the conditions set forth in
Sections 7.3(a) and 7.3(b) have been satisfied.
(e) Consents and Approvals. Cryenco shall have obtained any
consent, authorization or approval to the transactions contemplated by the
Agreement which is required to be obtained from any third party which is not a
Governmental Agency.
(f) No Cryenco Material Adverse Effect. From the date of this
Agreement through the Closing Date, Cryenco shall not have suffered a Cryenco
Material Adverse Effect.
(g) Dissenters Claims. Cryenco has not received a written
demand for appraisal from the holders of more than fifteen percent (15%) of the
issued and outstanding shares of Cryenco Common Stock in connection with the
Merger.
(h) Cryenco Arrangements with Affiliated Persons. Prior to
Closing, Cryenco shall have terminated the agreements and arrangements listed on
Schedule 6.1(o) ("Insider Agreements") hereto between Cryenco and certain
affiliated persons (including, but not limited to, directors, officers, key
employees and affiliates) by payment of the amounts set forth on Schedule 6.1(o)
but without any other expense to or obligation on the part of Cryenco, Chart or
CAC.
(i) Cancellation, Exercise, Sale or Exchange of Cryenco
Warrants and Options. Cryenco shall have obtained and delivered to Chart written
agreements from the holders of the Cryenco Warrants and Cryenco Options listed
on Schedule 6.1(c) exercising such Warrants or Options, agreeing to the
cancellation thereof, agreeing to the sale thereof to Chart pursuant to this
Agreement or agreeing to the exchange thereof for warrants or options to acquire
shares of Chart Common Stock pursuant to the provisions of Sections 5.3(f) and
5.3(g) above.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.1 Termination. This Agreement may be terminated at any time prior to
the Effective Time, whether before or after approval of this Agreement and the
Merger by the stockholders of Cryenco:
(a) by mutual consent of Cryenco and Chart;
(b) by Chart, upon a breach of any representation, warranty,
covenant or agreement on the part of Cryenco set forth in this Agreement, or if
any representation or warranty of Cryenco shall have become untrue, in either
case such that the condition set forth in Section 7.3(a) or Section 7.3(b) as
the case may be, would be incapable of being satisfied by August 29, 1997;
provided, that in any case, a willful breach shall be deemed to cause such
conditions to be incapable of being satisfied for purposes of this Section
8.1(b);
(c) by Cryenco, upon a breach of any representation, warranty,
covenant or agreement on the part of Chart set forth in this Agreement, or if
any representation or warranty of
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<PAGE> 36
Chart shall have become untrue, in either case such that the condition set forth
in Section 7.2(a) or 7.2(b), as the case may be, would be incapable of being
satisfied by August 29, 1997; provided, that in any case, a willful breach shall
be deemed to cause such conditions to be incapable of being satisfied for
purposes of this Section 8.1(c);
(d) by either Cryenco or Chart, if any permanent injunction or
action by any Governmental Agency preventing the consummation of the Merger
shall have become final and nonappealable;
(e) by either Cryenco or Chart, if the Merger shall not have
been consummated before August 29, 1997; provided, however, that this Agreement
may be extended by written notice of either Cryenco or Chart to a date not later
than September 30, 1997, if the Merger shall not have been consummated as a
direct result of Cryenco or Chart having failed by August 29, 1997, to receive
all required regulatory approvals or consents from Governmental Agencies with
respect to the Merger;
(f) by either Cryenco or Chart, if this Agreement and the
Merger shall fail to receive the requisite vote for approval and adoption by the
holders of Cryenco Common Stock at the Cryenco Special Meeting;
(g) by Chart, if (i) the Board of Directors of Cryenco shall
withdraw, modify or change its recommendation of this Agreement or the Merger in
a manner adverse to Chart or shall have resolved to do any of the foregoing;
(ii) the Board of Directors of Cryenco shall have recommended to the
stockholders of Cryenco a Competing Transaction (as defined below); (iii) a
tender offer or exchange offer for 25% or more of the outstanding shares of
Common Stock of Cryenco is commenced, and the Board of Directors of Cryenco
recommends that the stockholders of Cryenco tender their shares in such tender
or exchange offer; or (iv) subsequent to the date hereof, any person shall
acquire beneficial ownership or the right to acquire beneficial ownership of, or
any "group" (as such term is defined under Section 13(d) of the Exchange Act and
the rules and regulations promulgated thereunder) shall have been formed which
beneficially owns, more than 25% of the then outstanding shares of Common Stock
of Cryenco; provided, however, that for purposes of the foregoing definition of
"group," the Voting Agreements described in Section 9.8 shall not be deemed to
form the basis for determination that the signers thereof constitute a "group;"
(h) by Cryenco, if the Board of Directors of Cryenco (x) fails
to make or withdraws or modifies its recommendation that Cryenco stockholders
approve the Merger (as described in Section 5.3(a)), and there exists at such
time a Competing Transaction or (y) recommends to Cryenco's stockholders
approval or acceptance of a Competing Transaction, in each case only if the
Board of Directors of Cryenco, after consultation with and based upon the advice
of independent legal counsel (who may be such party's regularly engaged
independent legal counsel), determines in good faith that such action is
necessary for the Board of Directors of Cryenco to comply with its fiduciary
duties to stockholders under applicable law; and
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(i) by Chart, if Cryenco shall have received a written demand
for appraisal from the holders of more than 15% of the issued and outstanding
shares of Cryenco Common Stock in connection with the Merger.
In order to terminate this Agreement pursuant to Section 8.1(b) - (h) hereof,
the party so acting shall give written notice thereof to the other party hereto
specifying the reason for termination.
8.2 Effect of Termination. Except as provided in Section 8.5 or Section
9.1(b), in the event of the termination of this Agreement pursuant to Section
8.1, this Agreement shall forthwith become void, there shall be no liability on
the part of Chart, CAC or Cryenco or any of their respective officers or
directors to the other and all rights and obligations of any party hereto shall
cease; provided, however, that nothing herein shall relieve any party from
liability for the willful breach of any of its representations, warranties,
covenants or agreements set forth in this Agreement.
8.3 Amendment. This Agreement may be amended by the parties hereto by
action taken by or on behalf of their respective Boards of Directors at any time
prior to the Effective Time; provided, however, that, after approval of the
Merger by the stockholders of Cryenco, no amendment, which under applicable law
may not be made without the approval of the stockholders of Cryenco, may be made
without such approval. This Agreement may not be amended except by an instrument
in writing signed by the parties hereto.
8.4 Waiver. At any time prior to the Effective Time, either party
hereto may (a) extend the time for the performance of any of the obligations or
other acts of the other party hereto, (b) waive any inaccuracies in the
representations and warranties of the other party contained herein or in any
document delivered pursuant hereto and (c) waive compliance by the other party
with any of the agreements or conditions contained herein. Any such extension or
waiver shall be valid only if set forth in an instrument in writing signed by
the party or parties to be bound thereby.
8.5 Fees, Expenses and Other Payments.
(a) Except as set forth in Section 8.5(b), all costs and
expenses, including, without limitation, fees and disbursements of counsel,
financial advisors and accountants, incurred by the parties hereto shall be
borne solely and entirely by the party which has incurred such costs and
expenses (with respect to such party, its "Expenses").
(b) Cryenco agrees that if this Agreement shall be terminated
pursuant to:
(i) Section 8.1(b) and, at any time prior to the
written notice of termination delivered by Chart to Cryenco,
there existed a Competing Transaction;
(ii) Section 8.1(f) and at any time between the date
hereof and the Cryenco Special Meeting there existed a
Competing Transaction;
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<PAGE> 38
(iii) Section 8.1(g);
(iv) Section 8.1(h); or
(v) Section 8.1(i) and one or more of the affiliates
of Cryenco executing a Voting Agreement in connection with the
Merger has made a written demand for appraisal with respect to
5% or more of the Cryenco Common Stock entitled to vote on the
Merger;
then, in any such event, Cryenco shall pay to Chart an amount equal to $850,000.
(c) Any payment required to be made pursuant to Section 8.5(b)
shall be made as promptly as practicable but not later than five business days
after termination of this Agreement and shall be made by wire transfer of
immediately available funds to an account designated by Chart.
(d) For purposes of this Section 8.5, the term "Competing
Transaction" shall mean any of the following (other than the Merger) involving
Cryenco or any of its subsidiaries:
(i) any merger, consolidation, share exchange,
business combination or other similar transaction;
(ii) any sale, lease, exchange, mortgage, pledge,
transfer or other disposition of 25% or more of the assets of
Cryenco and its subsidiaries, taken as a whole, in a single
transaction or series of transactions;
(iii) any tender offer or exchange offer for 25% or
more of the outstanding shares of Common Stock of Cryenco or
the filing of a registration statement under the Securities
Act in connection therewith;
(iv) any person acquiring (after the date hereof)
beneficial ownership or the right to acquire beneficial
ownership of, or any "group" (as such term is defined under
Section 13(d) of the Exchange Act and the rules and
regulations promulgated thereunder) being formed (after the
date hereof) which beneficially owns or has the right to
acquire beneficial ownership of, 25% or more of the then
outstanding shares of Common Stock of Cryenco; provided,
however, that for purposes of the foregoing definition of
"group," the Voting Agreements described in Section 9.8 shall
not be deemed to form the basis for determination that the
signers thereof constitute a "group;"
(v) any public announcement of a proposal, plan or
intention to do any of the foregoing or any agreement to
engage in any of the foregoing.
ARTICLE IX
GENERAL PROVISIONS
9.1 Effectiveness of Representations, Warranties and Agreements.
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<PAGE> 39
(a) Except as set forth in Section 9.1(b), the
representations, warranties and agreements of each party hereto shall remain
operative and in full force and effect, regardless of any investigation made by
or on behalf of any other party hereto, any person controlling any such party or
any of their officers or directors, whether prior to or after the execution of
this Agreement.
(b) The representations, warranties and agreements in this
Agreement shall terminate at the Effective Time or upon the termination of this
Agreement pursuant to Article VIII, except that the agreements set forth in
Articles I, II, III and IX and Sections 5.1(e) and 5.4(a) shall survive the
Effective Time and those set forth in Sections 8.2, 8.5 and Article IX hereof
shall survive termination. In addition, in the event of the termination of this
Agreement pursuant to Article VIII, the provisions of the Confidentiality
Agreement dated as of November 11, 1996 shall be reinstated as if they had never
been superseded by Section 9.8 hereof.
9.2 Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given (and shall be deemed to have
been duly received if so given), when addressed as follows:
To Chart at:
Chart Industries, Inc.
35555 Curtis Boulevard
Eastlake, OH
Attention: Arthur S. Holmes, Chairman of the Board
and Chief Executive Officer
With a copy to:
Calfee, Halter & Griswold LLP
1400 McDonald Investment Center
800 Superior Avenue
Cleveland, Ohio 44114-2688
Attention: Thomas F. McKee
To Cryenco at:
Cryenco Sciences, Inc.
c/o Charterhouse Group International, Inc.
535 Madison Avenue - 28th Floor
New York, New York 10022
Attention: Alfred Schechter, Chairman of the Board,
Chief Executive Officer and President
33
<PAGE> 40
With a copy to:
Shack & Siegel, P.C.
530 Fifth Avenue
New York, New York 10036
Attention: Jeffrey N. Siegel
Except as otherwise specified herein, all notices and other
communications shall be deemed to have been duly given on the first to occur of
(a) the date of delivery if delivered personally on a business day during normal
business hours, and, if not, on the next occurring business day, (b) five days
following posting if transmitted by mail, (c) the first business day following
the date of delivery to a nationally-recognized, next day courier service; or
(d) the date of receipt if transmitted by telecopier or facsimile on a business
day during normal business hours, and, if not, on the next occurring business
day. Any party may change his or its address for purposes hereof by notice to
the other party given as provided in this Section.
9.3 Governing Law. Except to the extent required to comply with the
provisions of other jurisdictions, this Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, regardless of
the laws that might otherwise govern under applicable principles of conflicts of
law.
9.4 Successors. References in this Agreement to particular persons,
firms, agencies, statutes, regulations and the like shall be considered as
references to any successors thereto.
9.5 Assignment. This Agreement and all of the provisions hereof shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests, or obligations hereunder is otherwise assignable, or
shall be assigned (whether by operation of law or otherwise), by any of the
parties without the prior written consent of the other parties.
9.6 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, but both of which together shall
constitute one and the same agreement.
9.7 Schedules. Cryenco, Chart, GTC and CAC have, simultaneously with
the execution of this Agreement, initialed the front page of the Schedules which
are referred to herein.
9.8 Entire Agreement. This Agreement and the Schedules referred to
herein contain the entire agreement among the parties hereto with respect to the
Merger and the other transactions contemplated hereby, and supersedes all prior
agreements among the parties with respect to such matters including, without
limitation, the Confidentiality Agreement dated November 11, 1996.
Simultaneously herewith, (a) certain affiliates of Cryenco are entering into
agreements pursuant to which such affiliates agree under certain conditions, to
vote in favor of the Merger at the Cryenco Special Meeting (the "Voting
Agreements") and (b) Charterhouse
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<PAGE> 41
Group International, Inc. and Alfred Schechter are entering into agreements to
indemnify and hold Chart harmless from and against certain liabilities (the
"Indemnification Agreement").
IN WITNESS WHEREOF, each party hereto has caused this Agreement to be
duly executed as of the date first above written.
CHART INDUSTRIES, INC.
By: __________________________________
GREENVILLE TUBE CORPORATION
By: _______________________________
CHART ACQUISITION COMPANY, INC.
By: __________________________________
CRYENCO SCIENCES, INC.
By: __________________________________
35
<PAGE> 1
Exhibit 4.2
Right to Purchase 36,086* Shares of Convertible
Non-Voting Common Stock of Cryenco Sciences, Inc.
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN EXEMPTION THEREFROM UNDER SUCH ACT OR ANY APPLICABLE STATE
SECURITIES LAWS. FURTHERMORE, THIS WARRANT MAY BE SOLD OR OTHERWISE TRANSFERRED
ONLY IN COMPLIANCE WITH THE CONDITIONS SPECIFIED IN SECTION 21 OF THE AGREEMENT
REFERRED TO HEREINAFTER, A COMPLETE AND CORRECT COPY OF WHICH IS AVAILABLE FOR
INSPECTION AT THE PRINCIPAL OFFICE OF CRYENCO SCIENCES, INC. AND WILL BE
FURNISHED WITHOUT CHARGE TO THE HOLDER OF THIS WARRANT UPON WRITTEN REQUEST.
Cryenco Sciences, Inc.
Common Stock Purchase Warrant
Cryenco Sciences, Inc., a Delaware corporation (the "Company"), hereby
certifies that, for value received, Chemical Bank, a New York banking
corporation, as agent and as a lender, ("Chemical"), or its transferees,
successors and assigns, is entitled, subject to terms set forth below, to
purchase from the Company at any time or from time to time after the date
hereof and prior to the expiration hereof pursuant to Section 2.4 hereof,
36,086* fully paid and non-assessable shares of Convertible Non-Voting Common
Stock (as defined in Section 12 hereof), at an initial purchase price per
share of $6.18834* (such price per share as adjusted from time to time as
provided herein is referred to herein as the "Exercise Price"). The number and
character of such shares of Common Stock and the Exercise Price are subject to
adjustment as provided herein.
This Warrant is issued pursuant to that certain letter agreement dated
as of August 31, 1993, among the Company, Cryenco, Inc. and Chemical, amending
the Credit Agreement dated as of August 30, 1991, as amended (the "Credit
Agreement") among Cryenco, Inc., the lenders named therein (the "Lenders") and
Chemical, as agent for the Lenders, copies of which are on file at the
principal office of the Company. The holder of this Warrant shall be entitled
to all of the benefits and shall be subject to all of the obligations of the
Warrant Agreement dated as of August 30, 1991, as amended (the "Agreement"),
among the Company (as the surviving corporation in the merger of Cryenco
Holdings, Inc. with and into Gulf and Mississippi Corporation), Cryenco, Inc.
(as the surviving corporation in the merger of Cryogenic
__________________
* As adjusted to reflect the antidilution adjustments triggered by the Company's
Private Placement and related transactions with International Capital
Partners, Inc. which occurred in December 1994, January 1995 and June 1995.
<PAGE> 2
Energy Company with and into CEC Acquisition Corp.) and Chemical, relating to
the Warrants (as such term is defined in the Agreement) as provided therein as
amended to date.
I. DEFINITIONS.
------------
Terms defined in the Agreement and not otherwise defined herein shall
have the meanings assigned thereto in the Agreement. Certain terms used in this
Warrant are specifically defined in Section 12 hereof.
2. EXERCISE OF WARRANT.
--------------------
2.1 IN GENERAL. This Warrant may be exercised in whole or in part by the
holder hereof at any time or from time to time prior to its expiration by
surrender of this Warrant, with the form of subscription at the end hereof duly
executed by such holder, to the Company at its principal office, accompanied by
payment, by certified or official bank check payable to the order of the Company
or by wire transfer to its account in the amount obtained by multiplying the
number of shares of Common Stock for which this Warrant is then being exercised
by the Exercise Price then in effect; PROVIDED, HOWEVER, that the holder hereof
shall have the right, at its election, in lieu of delivering the Exercise Price
in cash, to instruct the Company in the form of subscription to retain, in
payment of the Exercise Price, a number of shares of Common Stock (the "Payment
Shares") equal to the quotient of (i) the aggregate Exercise Price of the shares
as to which this Warrant is then being exercised divided by (ii) the "Average
Closing Price" as of the date of exercise and to deduct the number of Payment
Shares from the shares to be delivered to the holder hereof. "Average Closing
Price" means, as of any date, (x) if shares of Voting Common Stock are listed on
a national securities exchange, the average of the closing sales prices therefor
on the largest securities exchange on which such shares are traded on the last
ten (10) trading days before such date, (y) if such shares are listed on the
NASDAQ National Market System but not on any national securities exchange, the
average of the closing sales prices therefor on the NASDAQ National Market
System on the last ten (10) trading days before such date or (z) if such shares
are not listed on either a national securities exchange or the NASDAQ National
Market System, the average of the sales prices therefor on the last twenty (20)
trading days before such date. In the event the Warrant is not exercised in
full, the Company, at its expense, will forthwith issue and deliver to or upon
the order of the holder hereof a new Warrant or Warrants of like tenor, in the
name of the holder hereof or as such holder (upon payment by such holder of any
applicable transfer taxes) may request, calling in the aggregate on the face or
faces thereof for the number of shares of Common Stock equal (without giving
effect to any adjustment therein) to the number of such shares called for on the
face of this Warrant minus the number of such shares (without giving effect to
any adjustment therein) for which this Warrant shall have been exercised.
2.2 Intentionally Omitted.
2.3 CONFLICT WITH OTHER LAWS. Any other provisions hereof to the
contrary notwithstanding, no Bank Affiliate shall be entitled to exercise the
right under this Warrant to
2
<PAGE> 3
purchase any share or shares of Common Stock if, under any law or under any
regulation, rule or other requirement of any governmental authority at any
time applicable to such Bank Affiliate, (a) as a result of such purchase, such
Bank Affiliate would own, control or have power to vote a greater quantity of
securities of any kind than the Bank Affiliate shall be permitted to own,
control or have power to vote or (b) such purchase would not be permitted. For
purposes of this Section 2.3, a written certification of the Bank Affiliate
exercising the Warrant, delivered upon surrender of the Warrant pursuant to
the Agreement, to the effect that the Bank Affiliate is legally entitled to
exercise its right under this Warrant to purchase securities and that such
purchase will not violate the prohibitions set forth in the preceding
sentence, shall be conclusive and binding upon the Company and shall obligate
the Company to deliver certificates representing the shares of Common Stock so
purchased in accordance with the other provisions hereof and shall relieve the
Company of any liability under this Section 2.3.
2.4 TERMINATION OF THE WARRANT. This Warrant shall terminate upon the
earlier to occur of (i) August 29, 2003 and (ii) the exercise in full.
3. REGISTRATION RIGHTS.
--------------------
The holder of this Warrant has the right to cause the Company to
register shares of Warrant Stock, and any shares issued upon exercise hereof,
under the Securities Act and any blue sky or securities laws of any
jurisdictions within the United States at the time and in the manner specified
in the Registration Rights Agreement.
4. DELIVERY OF STOCK CERTIFICATES ON EXERCISE.
-------------------------------------------
As soon as practicable after the exercise of this Warrant in full or
in part, any in any event within twenty (20) days thereafter, the Company at
its expense (including the payment by or of any applicable issue taxes) will
cause to be issued in the name of and delivered to the holder hereof, or as
such holder (upon payment by such holder of any applicable transfer taxes) may
direct, a certificate or certificates for the number of fully paid and
non-assessable shares of Common Stock (or Other Securities) which such holder
shall be entitled to receive on such exercise, together with any other stock
or other securities and property (other than cash) which such holder is
entitled to receive upon exercise.
5. ADJUSTMENT FOR DIVIDEND, DISTRIBUTION AND RECLASSIFICATIONS.
------------------------------------------------------------
In case at any time or from time to time the holders of Common Stock
shall have received or (on or after the record date fixed for the
determination of shareholders eligible to receive) shall have become entitled
to receive, without payment therefor:
(a) other or additional stock or other certificates or property (other
than cash) by way of dividend; or
(b) other or additional stock or other securities or property (other
than cash) by
3
<PAGE> 4
way of spin-off, split-up, reclassification, recapitalization, combination of
shares or similar corporate restructuring;
OTHER THAN additional shares of Common Stock issued in a stock split or other
reclassification, recapitalization or similar corporate restructuring of the
Company's Common Stock (adjustment in respect of which are provided for in
Section 7.1 hereof), then and in each such case the holder of this Warrant, on
the exercise hereof as provided in Section 2 hereof, shall be entitled to
receive the amount of stock and other securities and property (other than
cash) which such holder would have received prior to, or would have held on
the date of, such exercise if on the date hereof he had been the holder of
record of the number of shares of Common Stock called for on the face of this
Warrant and had thereafter, during the period from the date hereof to and
including the date of such exercise, retained such shares and all such other
or additional stock and other securities and property (other than cash)
receivable by such holder as aforesaid during such period, giving effect to
all further adjustments called for during such period by Sections 6 and 7
hereof. The Company hereby agrees that it will at all times reserve and keep
available for such holder, solely for delivery upon the exercise of this
Warrant, any distribution to which such holder is entitled under this Section
5.
6. ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC.
----------------------------------------------------------
6.1 CERTAIN ADJUSTMENTS. In case at any time or from time to time, the
Company shall (i) effect a capital reorganization, reclassification or
recapitalization, (ii) consolidate with or merge into any other Person or
(iii) transfer all or substantially all of its properties or assets to any
other Person under any plan or arrangement contemplating the dissolution of
the Company, then in each such case, the holder of this Warrant, on the
exercise hereof as provided in Section 2 hereof at any time after the
consummation of such reorganization, reclassification, recapitalization,
consolidation, merger or transfer, or the effective date of such dissolution,
as the case may be, shall receive, in lieu of the Common Stock (or Other
Securities) issuable on such exercise prior to such consummation or effective
date, the stock and other securities and property (including cash) to which
such holder would have been entitled upon such consummation or in connection
with such dissolution, as the case may be, if such holder had so exercised
this Warrant immediately prior thereto, all subject to further adjustment
thereafter as provided in Section 5 and 7 hereof.
6.2 CONTINUATION OF TERMS. Upon any reorganization, reclassification,
recapitalization, consolidation, merger or transfer referred to in this
Section 6, this Warrant shall continue in full force and effect and the terms
hereof shall be applicable to the shares of stock and Other Securities and
property receivable on the exercise of this Warrant after the consummation of
such reorganization, reclassification, recapitalization, consolidation or
merger, as the case may be, and shall be binding upon the issuer of any such
stock or Other Securities, including, in the case of any such transfer, the
Person acquiring all or substantially all of the properties or assets of the
Company, whether or not such Person shall have expressly assumed the terms of
this Warrant as provided in Section 8 hereof.
4
<PAGE> 5
7. ADJUSTMENTS FOR ISSUANCE OF COMMON STOCK
AND AMOUNT OF OUTSTANDING COMMON STOCK.
---------------------------------------
7.1 IN GENERAL. If at any time there shall occur any stock split,
stock dividend, reverse stock split or other subdivision, reclassification,
recapitalization, recombination of shares or similar corporate restructuring
of the Company's Common Stock, any rights offering by the Company to its
existing stockholders or any issuance by the Company of Additional Shares of
Common Stock upon the exercise of Convertible Securities (each as defined in
Section 7.2 hereof) granted before the consummation of the G&M Merger, other
than any such shares issued upon the exercise of options granted to Thomas A.
Trantum before August 30, 1991 (each, a "Stock Event"), then the number of
shares of Common Stock to be received by the holder of this Warrant shall be
appropriately adjusted such that the proportion of the number of shares
issuable hereunder to the total number of outstanding shares of the Company
(calculated on a Fully-Diluted Basis) prior to such Stock Event is equal to
the proportion of the number of outstanding shares of the Company after such
Stock Event (calculated on a Fully-Diluted Basis). No adjustment to the
Exercise Price shall be made in connection with any adjustment of the number
of shares of Common Stock receivable upon exercise of this Warrant, except
that the Exercise Price shall be proportionately increased or decreased upon
the occurrence of any event provided for in this Section 7.1 so that the
aggregate Exercise Price for all shares of Common Stock covered hereby shall
remain unchanged.
7.2 ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. If at any time the
Company shall issue or sell (i) any Additional Shares of Common Stock in
exchange for consideration in an amount per Additional Share of Common Stock
less than the Fair Market Value Per Share of Common Stock at the time the
Additional Shares of Common Stock are issued or sold or (ii) any Convertible
Securities having an exercise price or Conversion Price in an amount per share
of Common Stock less than the Fair Market Value Per Share of Common Stock at
the time of such issuance or sale, then the number of shares of Common Stock
for which this Warrant is exercisable shall be adjusted to equal the product
obtained by multiplying the number of shares of Common Stock for which this
Warrant is exercisable immediately prior to such issuance or sale by a
fraction (a) the numerator of which shall be the number of shares of Common
Stock outstanding immediately after such issuance or sale (assuming the
conversion or exercise of all such Convertible Securities) and (b) the
denominator of which shall be the number of shares of Common Stock outstanding
immediately prior to such issuance or sale plus either (x) the number of
shares which the aggregate offering price of the total number of such
Additional Shares of Common Stock would purchase at the then Fair Market Value
Per Share or (y) the number of shares of Common Stock which could be purchased
if the exercise price of such Convertible Security or the Conversion Price of
such Convertible Security (as applicable) were set at the then Fair Market
Value Per Share. Thereupon, the Exercise Price shall be correspondingly
reduced so that the aggregate Exercise Price for all shares of Common Stock
covered hereby shall remain unchanged. No adjustments shall be made upon the
exercise or conversion of Convertible Securities. For purposes of this
paragraph, (i) the term "Additional Shares of Common Stock" means any shares
of Common Stock issued by the Company after the Closing Date other than
Warrant Stock or stock issuable upon the exercise of options granted
5
<PAGE> 6
to Thomas A. Trantum, before August 30, 1991, (ii) the term "Convertible
Securities" means all options, warrants or securities exercisable for, all
rights to subscribe for, and all securities which are convertible into to
exchangeable for, Common Stock and (iii) the term "Conversion Price" means, with
respect to any Convertible Security, the price paid for such Convertible
Security divided by the number of shares of Common Stock into which such
Convertible Security is convertible on the date of issuance of such Convertible
Security.
8. NO DILUTION OR IMPAIRMENT.
--------------------------
The Company will not, by amendment of its Certificate of Incorporation
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such action as may be necessary or appropriate in order
to protect the rights of the holder of this Warrant hereunder. Without limiting
the generality of the foregoing, the Company (i) will not increase the par value
of any shares of stock receivable on the exercise of the Warrant above the
amount payable therefor on such exercise, (ii) will take all such action as may
be necessary or appropriate in order that the Company may validly and legally
issue fully paid and non-assessable shares of stock on the exercise of the
Warrant from time to time outstanding, (iii) will not issue any capital stock of
any class which is preferred as to dividends or as to the distribution of assets
upon voluntary or involuntary dissolution, liquidation or winding up, unless the
rights of the holders thereof shall be limited to a fixed sum or percentage of
par value in respect of participation in dividends and in any such distribution
of assets and (iv) will not transfer all or substantially all of its properties
and assets to any other entity (corporate or otherwise), or consolidate with or
merge into any other entity or permit any such entity to consolidate with or
merge into the Company (if the Company is not the surviving entity), unless such
other entity shall expressly assume in writing and will be bound by all the
terms of this Warrant and the Agreement. If any event occurs as to which the
provisions of Sections 5, 6 or 7 hereof are strictly applicable and the
application thereof would not, in the good faith judgment of the Board of
Directors of the Company, fairly protect the purchase rights of the Warrants in
accordance with the essential intent and principles of such provisions, then
such Board shall make such adjustments in the application of such provisions, in
accordance with such essential intent and principles, as shall be reasonably
necessary, in the good faith opinion of such Board, to protect such purchase
rights as aforesaid, but in no event shall any such adjustment have the effect
of increasing the Exercise Price or decreasing the number of shares of Common
Stock subject to purchase upon exercise of this Warrant. Nothing contained in
this Warrant shall prohibit the Company from issuing or selling securities in
the future.
9. ACCOUNTANTS' CERTIFICATE AS TO ADJUSTMENTS.
-------------------------------------------
In each case of any event that may require any adjustment or
readjustment in the shares of Common Stock (or Other Securities) issuable on the
exercise of this Warrant, the Company at its expense will promptly prepare a
certificate setting forth such adjustment or readjustment and showing, in
detail, the facts upon which any such adjustment or readjustment
6
<PAGE> 7
is based, including a statement of (i) the number of shares of the Company's
Common Stock then outstanding on a Fully-Diluted Basis, and (ii) the number of
shares of Common Stock (or Other Securities) to be received upon exercise of
this Warrant (A) immediately prior to such adjustment or readjustment and (B) as
adjusted and readjusted (if required by Section 7) on account thereof. The
Company will forthwith mail a copy of each such certificate to each holder of a
Warrant and will, on the written request at any time of any holder of a Warrant,
furnish to such holder a like certificate setting forth the calculations used to
determine such adjustment or readjustment. At its option, the holder of a
Warrant may confirm the adjustment noted on the certificate by causing such
adjustment to be computed by an independent certified public accountant at the
expense of the Company. The cost of any such confirmation shall be borne (x) by
the Company, if the computation of such independent certified public accountant
indicates that the adjustment noted on the Company's certificate was in any
respect incorrect to the detriment of the holders, and (y) otherwise, by the
holder requesting such confirmation.
10. NOTICES OF RECORD DATE.
-----------------------
In the event of:
(a) any taking by the Company of a record of the holders of any
class of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend or other distribution (including, without
limitation, any distribution that may arise as a result of a spin-off,
split-up, reclassification, recapitalization, combination of shares or similar
corporate restructuring), or any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other securities or property,
or to receive any other right;
(b) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company or any
transfer of all or substantially all the assets of the Company to or any
consolidation or merger of the Company with or into any other Person;
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company; or
(d) any proposed issuance or grant by the Company of any shares
of stock of any class or any other securities, or any right or option to
subscribe for, purchase or otherwise acquire any shares of stock of any class
or any other securities (other than the issuance of Common Stock on the
exercise of this Warrant),
then, and in each such event, the Company will mail or cause to be mailed to
the holder of this Warrant a notice specifying (i) the date on which any such
record is to be taken for the purpose of such dividend, distribution or right,
and stating the amount and character of such dividend, distribution or right,
(ii) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up is to take place and the time, if any, to be fixed, as of which the
holders of record of Common Stock (or
7
<PAGE> 8
Other Securities) shall be entitled to exchange their shares of Common Stock
(or Other Securities) for securities or other property deliverable on such
reorganization, reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding-up and (iii) the amount and
character of any stock or other securities, or rights or options with respect
thereto, proposed to be issued or granted, the date of such proposed issue or
grant and the persons or class of persons to whom such proposed issue or grant
is to be offered or made. Such notice shall be mailed at least twenty (20) days
prior to the date specified in such notice on which any such action is to be
taken.
11. RESERVATION OF STOCK ISSUABLE ON EXERCISE OF WARRANT.
-----------------------------------------------------
The Company will at all times reserve and keep available, solely for
issuance and delivery on the exercise of the Warrant, a number of shares of
Convertible Non-Voting Common Stock equal to the total number of shares of
Convertible Non-Voting Common Stock from time to time issuable upon exercise of
this Warrant and the number of Other Securities which at any time may be
issuable hereunder, and, from time to time, will take all steps necessary to
amend its Certificate of Incorporation to provide sufficient reserves of shares
of Common Stock issuable upon exercise of the Warrant and upon the conversion
of shares of one class of Common Stock into shares of the other class of Common
Stock, as provided in its Certificate of Incorporation.
12. DEFINED TERMS.
--------------
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
12.1 The term BANK AFFILIATE means any Person that is a bank holding
company or a subsidiary of a bank holding company as defined in the Bank
Holding Company Act of 1956, as amended, or other applicable banking laws of
the United States and the rules and regulations promulgated thereunder.
12.2 The term COMPANY means Cryenco Sciences, Inc., the surviving
corporation of the merger of CHI into G&M, and any corporation which shall
succeed to or assume the obligations of the Company hereunder.
12.3 The term COMMON STOCK means (i) the Company's Voting Common
Stock, $.01 par value (the "Voting Common Stock"), (ii) the Company's
Convertible Non-Voting Common Stock, $.01 par value (the "Convertible
Non-Voting Common Stock"), (iii) any other capital stock of any class or
classes (however designated) of the Company the holders of which shall have the
right, without limitation as to amount, either to all or to a share of the
balance of current dividends and liquidating dividends after the payment of
dividends and distributions on any shares entitled to preference and (iv) any
other securities into which or for which any of the securities described in
clauses (i), (ii) or (iii) above have been converted, exchanged or combined
pursuant to a plan of recapitalization, reorganization, merger, sale of assets
or otherwise.
8
<PAGE> 9
12.4 The term OTHER SECURITIES means any sLock (other than Common
Stock) and other securities of the Company or any other entity (corporate or
otherwise) which (i) the holder of this Warrant at any time shall be entitled to
receive, or shall have received, on the exercise of this Warrant, in lieu of or
in addition to Common Stock, or (ii) at any time shall be issuable or shall
have been issued in exchange for or in replacement of Common Stock or Other
Securities, in each case pursuant to Section 5 or 6 hereof.
13. REMEDIES.
---------
The Company stipulates that the remedies at law of the holder of this
Warrant in the event of any default or threatened default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that such terms may be specifically enforced by a
decree for the specific performance of any agreement contained herein or by an
injunction against a violation of any of the terms hereof or otherwise.
14. NOTICES.
--------
All notices and other communications provided for or permitted
hereunder shall be made in writing (including facsimile transmission or other
similar writing) as follows: if to Chemical, to it at 277 Park Avenue, Floor
14, New York, New York 10172, Attention: Patrick J. Ryan (telecopier no.: (212)
688-3859), with a copy to Kaye, Scholer, Fierman, Hays & Handler, 425 Park
Avenue, New York, New York 10022, Attention: Jeffrey Epstein, Esq. (telecopier
no.: (212) 836-8694); if to a subsequent holder of this Warrant, to it at such
address as may have been furnished to the Company in writing by such holder or,
until any such holder furnishes to the Company an address, then to, and at the
address of, the last holder of this Warrant who has so furnished an address to
the Company; and if to the Company, to it c/o Charterhouse Group International,
Inc. at 535 Madison Avenue, 28th Floor, New York, New York 10022, Attention:
President (telecopier no.: (212) 750-9704) with a copy to Shack & Siegel, P.C.
530 Fifth Avenue, New York, New York 10036, Attention: Jeffrey N. Siegel, Esq.
(telecopier no.: (212) 730-1964); and thereafter at such other address, notice
of which is given in accordance with the provisions of this Section 14.
All such notices shall be deemed to have been duly given: (i) if
delivered personally, upon actual delivery, (ii) if delivered by mail, one
Business Day after deposited in the United States mail, overnight express mail,
return receipt requested, postage prepaid, or one Business Day after delivery
to a nationally recognized overnight express mail or courier service, or (iii)
if sent by facsimile transmission (or other similar writing), upon receipt of
telephonic or written confirmation thereof.
15. PUBLIC FILINGS. NASDAO QUALIFICATIONS; AND MISCELLANEOUS.
---------------------------------------------------------
15.1 PUBLIC FILINGS AND NASDAO QUALIFICATION. For so long as (i) this
Warrant is outstanding or (ii) the Shares of Warrant Stock issuable upon the
exercise of this Warrant are outstanding and have not been registered or
transferred in reliance upon Rule 144 or Rule 144A,
9
<PAGE> 10
in each case as amended from time to time under the Securities Act, or any
successor provisions relating to the resale of restricted securities without
registration under Section 5 of the Securities Act, the Company agrees to use
its best efforts (A) to file timely (whether or not it shall then be required
to do so) such information, documents and reports as the Commission may require
or prescribe under Section 13 or 15(d) (whichever is applicable) of the
Exchange Act, (B) promptly upon request, to furnish to any holder of this
Warrant or the Warrant Stock a copy of the most recent annual, current or
quarterly report of the Company and such other information which is provided to
all stockholders of the Company generally, (C) to file such other information,
documents and reports as shall be required of it hereafter by the Commission as
a condition to the availability of Rule 144 or 144A, in each case as may be
amended from time to time, under the Securities Act, or any successor (but not
additional) provisions relating to the resale of restricted securities without
registration under Section 5 of the Securities Act, and (D) to maintain the
quotation of its Common Stock on the National Association of Securities
Dealers, Inc. Automated Quotation System (bid and asked) including, without
limitation, using its best efforts to keep effective the registration to its
Common Stock under Section 12 of the Exchange Act and to make timely payment of
all applicable fees.
15.2 MISCELLANEOUS. In case any provision of this Warrant shall be
invalid, illegal or unenforceable, or partially invalid, illegal or
unenforceable, the provision shall be enforced to the extent, if any, that it
may legally be enforced and the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby. This
Warrant and any term hereof may be changed, waived, discharged or terminated
only by a statement in writing signed by the party against which enforcement of
such change, waiver, discharge or termination is sought. This Warrant shall be
governed by and construed in accordance with the domestic substantive laws (and
not the conflict of law rules) of the State of New York. The headings in this
Warrant are for purposes of reference only, and shall not limit or otherwise
affect any of the terms hereof.
10
<PAGE> 11
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
by its duly authorized officer and attested by its Secretary.
Dated as of November 24, 1993
CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
------------------------------
Name: Alfred Schechter
Title: Chairman
Attest:
/s/ James A. Raabe
- ---------------------------
Name: James A. Raabe
Title: Secretary
11
<PAGE> 12
FORM OF SUBSCRIPTION
(To be signed only on exercise
of Common Stock Purchase Warrant)
To: Cryenco Sciences, Inc.
The undersigned, the Holder of the within Common Stock Purchase
Warrant, hereby irrevocably elects to exercise this Common Stock Purchase
Warrant for, and to purchase thereunder, _____ shares of Convertible Non-Voting
Common Stock of Cryenco Sciences, Inc. and herewith [makes payment of $_____
therefor] [instructs you herein, in payment of the Exercise Price, to deduct
____ shares of Convertible Non-Voting Common Stock and to deliver the net
number of shares, being ___ shares of Convertible Non-Voting Common Stock], and
requests that the certificates for such shares be issued in the name of, and
delivered to _________________ whose address is
__________________________________________.
Dated:
__________________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant)
__________________________________________
(Address)
<PAGE> 13
FORM OF ASSIGNMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and
transfers unto __ the right represented by the within Warrant to purchase ___
shares of ______ Common Stock of Cryenco Sciences, Inc., a Delaware
corporation, to which the within Warrant relates, and appoints _________,
attorney to transfer such right on the books of Cryenco Sciences, Inc., with
full power of substitution in the premises.
[Name of Assignor]
Dated: ____________ By: ____________________________________
Title: ______________________
Address: ______________________
Signed in the presence of:
________________________
<PAGE> 1
Exhibit 4.3
Right to Purchase 7,317* Shares of Convertible
Non-Voting Common Stock of Cryenco Sciences, Inc.
THIS WARRANT HAS NOT BEEN, AND ANY SHARES ACQUIRED UPON THE EXERCISE
OF THIS WARRANT WILL NOT BE, REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN EXEMPTION THEREFROM UNDER SUCH ACT OR ANY APPLICABLE STATE SECURITIES
LAWS. FURTHERMORE, THIS WARRANT MAY BE SOLD OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE CONDITIONS SPECIFIED IN SECTION 21 OF THE AGREEMENT
REFERRED TO HEREINAFTER, A COMPLETE AND CORRECT COPY OF WHICH IS AVAILABLE FOR
INSPECTION AT THE PRINCIPAL OFFICE OF CRYENCO SCIENCES, INC. AND WILL BE
FURNISHED WITHOUT CHARGE TO THE HOLDER OF THIS WARRANT UPON WRITTEN REQUEST.
Cryenco Sciences, Inc.
Common Stock Purchase Warrant
Cryenco Sciences, Inc., a Delaware corporation (the "Company"), hereby
certifies that, for value received, Chemical Bank, a New York banking
corporation, as agent and as a lender, ("Chemical"), or its transferees,
successors and assigns, is entitled, subject to the terms set forth below, to
purchase from the Company at any time or from time to time after the date
hereof and prior to the expiration hereof pursuant to Section 2.4 hereof,
7,317* fully paid and non-assessable shares of Convertible Non-Voting Common
Stock (as defined in Section 12 hereof), at an initial purchase price per share
of $4.84951* (such price per share as adjusted from time to time as provided
herein is referred to herein as the "Exercise Price"). The number and character
of such shares of Common Stock and the Exercise Price are subject to adjustment
as provided herein.
This Warrant is issued to replace a Warrant dated April 27, 1992 and
is issued pursuant to that certain letter agreement dated August 12, 1992,
between the Company and Chemical, amending certain agreements including the
Warrant Agreement dated as of August 30, 1991, as amended (the "Agreement"),
among the Company (as the surviving corporation in the merger of Cryenco
Holdings, Inc. with and into Gulf & Mississippi Corporation), Cryenco, Inc. (as
the surviving corporation in the merger of Cryogenic Energy Company with and
into CEC
_______________________
* As adjusted to reflect the reverse stock split of the Company's Common
Stock effective August 13, 1992 and the antidilution adjustments
triggered by the Company's Private Placement and related transactions
with International Capital Partners, Inc. which occurred in December
1994, January 1995 and June 1995.
<PAGE> 2
Acquisition Corp.) and Chemical, copies of which are on file at the principal
office of the Company. The holder of this Warrant shall be entitled to all of
the benefits and shall be subject to all of the obligations of the Agreement
relating to the CHI Warrant (as such term is defined in the Agreement) as
provided therein as amended to date, as if this Warrant were substituted
therefor.
1. DEFINITIONS.
------------
Terms defined in the Agreement and not otherwise defined herein shall
have the meanings assigned thereto in the Agreement. Certain terms used in this
Warrant are specifically defined in Section 12 hereof.
2. EXERCISE OF WARRANT.
--------------------
2.1. IN GENERAL. This Warrant may be exercised in whole or in part by
the holder hereof at any time or from time to time prior to its expiration by
surrender of this Warrant, with the form of subscription at the end hereof duly
executed by such holder, to the Company at its principal office, accompanied by
payment, by certified or official bank check payable to the order of the
Company or by wire transfer to its account in the amount obtained by
multiplying the number of shares of Common Stock for which this Warrant is then
being exercised by the Exercise Price then in effect; PROVIDED, HOWEVER, that
the holder hereof shall have the right, at its election, in lieu of delivering
the Exercise Price in cash, to instruct the Company in the form of subscription
to retain, in payment of the Exercise Price, a number of shares of Common Stock
(the "Payment Shares") equal to the quotient of (i) the aggregate Exercise
Price of the shares as to which this Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct the
number of Payment Shares from the shares to be delivered to the holder hereof.
"Average Closing Price" means, as of any date, (x) if shares of Voting Common
Stock are listed on a national securities exchange, the average of the closing
sales prices therefor on the largest securities exchange on which such shares
are traded on the last ten (10) trading days before such date, (y) if such
shares are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last ten (10) trading days before such
date or (z) if such shares are not listed on either a national securities
exchange or the NASDAQ National Market System, the average of the sales prices
therefor on the last twenty (20) trading days before such date. In the event
the Warrant is not exercised in full, the Company, at its expense, will
forthwith issue and deliver to or upon the order of the holder hereof a new
Warrant or Warrants of like tenor, in the name of the holder hereof or as such
holder (upon payment by such holder of any applicable transfer taxes) may
request, calling in the aggregate on the face or faces thereof for the number
of shares of Common Stock equal (without giving effect to any adjustment
therein) to the number of such shares called for on the face of this Warrant
minus the number of such shares (without giving effect to any adjustment
therein) for which this Warrant shall have been exercised.
2.2. Intentionally Omitted.
2
<PAGE> 3
2.3. CONFLICT WITH OTHER LAWS. Any other provisions hereof to the
contrary notwithstanding, no Bank Affiliate shall be entitled to exercise the
right under this Warrant to purchase any share or shares of Common Stock if,
under any law or under any regulation, rule or other requirement of any
governmental authority at any time applicable to such Bank Affiliate, (a) as a
result of such purchase, such Bank Affiliate would own, control or have power
to vote a greater quantity of securities of any kind than the Bank Affiliate
shall be permitted to own, control or have power to vote or (b) such purchase
would not be permitted. For purposes of this Section 2.3, a written
certification of the Bank Affiliate exercising this Warrant, delivered upon
surrender of the Warrant pursuant to the Agreement, to the effect that the Bank
Affiliate is legally entitled to exercise its right under this Warrant to
purchase securities and that such purchase will not violate the prohibitions
set forth in the preceding sentence, shall be conclusive and binding upon the
Company and shall obligate the Company to deliver certificates representing the
shares of Common Stock so purchased in accordance with the other provisions
hereof and shall relieve the Company of any liability under this Section 2.3.
2.4. TERMINATION OF THE WARRANT. This Warrant shall terminate upon the
earlier to occur of (i) August 29, 2003 and (ii) the exercise in full.
3. PUT OPTION: REGISTRATION RIGHTS.
--------------------------------
The holder of this Warrant has the option to require the Company to
purchase this Warrant and/or shares of Warrant Stock at the times and in the
manner specified in the Agreement, except that this option shall not apply with
respect to Section 11.1 (including with reference to Sections 10.2 and 11.5) of
the Agreement and Section 16.6 of the Securities Purchase Agreement dated as of
August 30, 1991, as amended, among the Company (as the surviving corporation in
the merger of Cryenco Holdings, Inc. with and into Gulf & Mississippi
Corporation), Cryenco, Inc. (as the surviving corporation in the merger of
Cryogenic Energy Company with and into CEC Acquisition Corp.) and The CIT
Group/Equity Investments, Inc.; provided, however, that the automatic exercise
of such put rights as provided in Section 10.2 of the Agreement shall continue
to apply to the extent such rights occur as a result of a default under Section
10.1(h)(i), (ii) or (iv) of the Agreement (except that with respect to Section
10.1(h)(iv), the words "or insolvent" in subparagraph (x) of such section
shall be deemed to be deleted for purposes of this provision only). The holder
of this Warrant has the right to cause the Company to register shares of
Warrant Stock, and any shares issued upon exercise hereof, under the Securities
Act and any blue sky or securities laws of any jurisdictions within the United
States at the time and in the manner specified in the Registration Rights
Agreement.
4. DELIVERY OF STOCK CERTIFICATES ON EXERCISE.
-------------------------------------------
As soon as practicable after the exercise of this Warrant in full or
in part, and in any event within twenty (20) days thereafter, the Company at its
expense (including the payment by it of any applicable issue taxes) will cause
to be issued in the name of and delivered to the holder hereof, or as such
holder (upon payment by such holder of any applicable transfer taxes)
3
<PAGE> 4
may direct, a certificate or certificates for the number of fully paid and
non-assessable shares of Common Stock (or Other Securities) which such holder
shall be entitled to receive on such exercise, together with any other stock or
other securities and property (other than cash) which such holder is entitled
to receive upon such exercise.
5. ADJUSTMENT FOR DIVIDENDS, DISTRIBUTIONS AND RECLASSIFICATIONS.
--------------------------------------------------------------
In case at any time or from time to time the holders of Common Stock
shall have received or (on or after the record date fixed for the determination
of shareholders eligible to receive) shall have become entitled to receive,
without payment therefor:
(a) other or additional stock or other securities or property (other
than cash) by way of dividend; or
(b) other or additional stock or other securities or property (other
than cash) by way of spin-off, split-up, reclassification, recapitalization,
combination of shares or similar corporate restructuring;
OTHER THAN additional shares of Common Stock issued in a stock split or other
reclassification, recapitalization or similar corporate restructuring of the
Company's Common Stock (adjustments in respect of which are provided for in
Section 7.1 hereof), then and in each such case the holder of this Warrant, on
the exercise hereof as provided in Section 2 hereof, shall be entitled to
receive the amount of stock and other securities and property (other than cash)
which such holder would have received prior to, or would have held on the date
of, such exercise if on the date hereof he had been the holder of record of the
number of shares of Common Stock called for on the face of this Warrant and had
thereafter, during the period from the date hereof to and including the date of
such exercise, retained such shares and all such other or additional stock and
other securities and property (other than cash) receivable by such holder as
aforesaid during such period, giving effect to all further adjustments called
for during such period by Sections 6 and 7 hereof. The Company hereby agrees
that it will at all times reserve and keep available for such holder, solely
for delivery upon the exercise of this Warrant, any distribution to which such
holder is entitled under this Section 5.
6. ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC.
----------------------------------------------------------
6.1. CERTAIN ADJUSTMENTS. In case at any time or from time to time,
the Company shall (i) effect a capital reorganization, reclassification or
recapitalization, (ii) consolidate with or merge into any other Person or (iii)
transfer all or substantially all of its properties or assets to any other
Person under any plan or arrangement contemplating the dissolution of the
Company, then in each such case, the holder of this Warrant, on the exercise
hereof as provided in Section 2 hereof at any time after the consummation of
such reorganization, reclassification, recapitalization, consolidation, merger
or transfer, or the effective date of such dissolution, as the case may be,
shall receive, in lieu of the Common Stock (or Other Securities) issuable on
such exercise prior to such consummation or effective date, the stock and other
securities and
4
<PAGE> 5
property (including cash) to which such holder would have been entitled upon
such consummation or in connection with such dissolution, as the case may be,
if such holder had so exercised this Warrant immediately prior thereto, all
subject to further adjustment thereafter as provided in Sections 5 and 7
hereof.
6.2. CONTINUATION OF TERMS. Upon any reorganization, reclassification,
recapitalization, consolidation, merger or transfer referred to in this Section
6, this Warrant shall continue in full force and effect and the terms hereof
shall be applicable to the shares of stock and Other Securities and property
receivable on the exercise of this Warrant after the consummation of such
reorganization, reclassification, recapitalization, consolidation or merger, as
the case may be, and shall be binding upon the issuer of any such stock or
Other Securities, including, in the case of any such transfer, the Person
acquiring all or substantially all of the properties or assets of the Company,
whether or not such Person shall have expressly assumed the terms of this
Warrant as provided in Section 8 hereof.
7. ADJUSTMENTS FOR ISSUANCE OF COMMON STOCK
AND AMOUNT OF OUTSTANDING COMMON STOCK.
----------------------------------------
7.1. IN GENERAL. If at any time there shall occur any stock split,
stock dividend, reverse stock split or other subdivision, reclassification,
recapitalization, recombination of shares or similar corporate restructuring of
the Company's Common Stock, any rights offering by the Company to its existing
stockholders or any issuance by the Company of Additional Shares of Common
Stock upon the exercise of Convertible Securities (each as defined in Section
7.2 hereof) granted before the consummation of the G&M Merger, other than any
such shares issued upon the exercise of options granted to Thomas A. Trantum
before August 30, 1991 (each, a "Stock Event"), then the number of shares of
Common Stock to be received by the holder of this Warrant shall be
appropriately adjusted such that the proportion of the number of shares
issuable hereunder to the total number of outstanding shares of the Company
(calculated on a Fully-Diluted Basis) prior to such Stock Event is equal to the
proportion of the number of shares issuable hereunder after such Stock Event to
the total number of outstanding shares of the Company after such Stock Event
(calculated on a Fully-Diluted Basis). No adjustment to the Exercise Price
shall be made in connection with any adjustment of the number of shares of
Common Stock receivable upon exercise of this Warrant, except that the Exercise
Price shall be proportionately increased or decreased upon the occurrence of
any event provided for in this Section 7.1 so that the aggregate Exercise Price
for all shares of Common Stock covered hereby shall remain unchanged.
7.2. ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. If at any time the
Company shall issue or sell (i) any Additional Shares of Common Stock in
exchange for consideration in an amount per Additional Share of Common Stock
less than the Fair Market Value Per Share of Common Stock at the time the
Additional Shares of Common Stock are issued or sold or (ii) any Convertible
Securities having an exercise price or Conversion Price in an amount per share
of Common Stock less than the Fair Market Value Per Share of Common Stock at
the time of such issuance or sale, then the number of shares of Common Stock
for which this Warrant is
5
<PAGE> 6
exercisable shall be adjusted to equal the product obtained by multiplying the
number of shares of Common Stock for which this Warrant is exercisable
immediately prior to such issuance or sale by a fraction (a) the numerator of
which shall be the number of shares of Common Stock outstanding immediately
after such issuance or sale (assuming the conversion or exercise of all such
Convertible Securities) and (b) the denominator of which shall be the number of
shares of Common Stock outstanding immediately prior to such issuance or sale
plus either (x) the number of shares which the aggregate offering price of the
total number of such Additional Shares of Common Stock would purchase at the
then Fair Market Value Per Share or (y) the number of shares of Common Stock
which could be purchased if the exercise price of such Convertible Security or
the Conversion Price of such Convertible Security (as applicable) were set at
the then Fair Market Value Per Share. Thereupon, the Exercise Price shall be
correspondingly reduced so that the aggregate Exercise Price for all shares of
Common Stock covered hereby shall remain unchanged. No adjustments shall be
made upon the exercise or conversion of Convertible Securities. For purposes of
this paragraph, (i) the term "Additional Shares of Common Stock" means any
shares of Common Stock issued by the Company after the Closing Date other than
Warrant Stock or stock issuable upon the exercise of options granted to Thomas
A. Trantum, before August 30, 1991, (ii) the term "Convertible Securities"
means all options, warrants or securities exercisable for, all rights to
subscribe for, and all securities which are convertible into or exchangeable
for, Common Stock and (iii) the term "Conversion Price" means, with respect to
any Convertible Security, the price paid for such Convertible Security divided
by the number of shares of Common Stock into which such Convertible Security is
convertible on the date of issuance of such Convertible Security.
8. NO DILUTION OR IMPAIRMENT.
--------------------------
The Company will not, by amendment of its Certificate of Incorporation or
through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such action as may be necessary or appropriate in order
to protect the rights of the holder of this Warrant hereunder. Without limiting
the generality of the foregoing, the Company (i) will not increase the par value
of any shares of stock receivable on the exercise of the Warrant above the
amount payable therefor on such exercise, (ii) will take all such action as may
be necessary or appropriate in order that the Company may validly and legally
issue fully paid and non-assessable shares of stock on the exercise of the
Warrant from time to time outstanding, (iii) will not issue any capital stock of
any class which is preferred as to dividends or as to the distribution of assets
upon voluntary or involuntary dissolution, liquidation or winding up, unless the
rights of the holders thereof shall be limited to a fixed sum or percentage of
par value in respect of participation in dividends and in any such distribution
of assets and (iv) will not transfer all or substantially all of its properties
and assets to any other entity (corporate or otherwise), or consolidate with or
merge into any other entity or permit any such entity to consolidate with or
merge into the Company (if the Company is not the surviving entity), unless such
other entity shall expressly assume in writing and will be bound by all the
terms of this Warrant and the Agreement. If any event occurs as to which the
provisions of
6
<PAGE> 7
Sections 5, 6 or 7 hereof are strictly applicable and the application thereof
would not, in the good faith judgment of the Board of Directors of the Company,
fairly protect the purchase rights of the Warrants in accordance with the
essential intent and principles of such provisions, then such Board shall make
such adjustments in the application of such provisions, in accordance with such
essential intent and principles, as shall be reasonably necessary, in the good
faith opinion of such Board, to protect such purchase rights as aforesaid, but
in no event shall any such adjustment have the effect of increasing the
Exercise Price or decreasing the number of shares of Common Stock subject to
purchase upon exercise of this Warrant. Nothing contained in this Warrant shall
prohibit the Company from issuing or selling securities in the future.
9. ACCOUNTANTS' CERTIFICATE AS TO ADJUSTMENTS.
-------------------------------------------
In each case of any event that may require any adjustment or readjustment
in the shares of Common Stock (or Other Securities) issuable on the exercise of
this Warrant, the Company at its expense will promptly prepare a certificate
setting forth such adjustment or readjustment and showing, in detail, the facts
upon which any such adjustment or readjustment is based, including a statement
of (i) the number of shares of the Company's Common Stock then outstanding on a
Fully-Diluted Basis, and (ii) the number of shares of Common Stock (or Other
Securities) to be received upon exercise of this Warrant (A) immediately prior
to such adjustment or readjustment and (B) as adjusted and readjusted (if
required by Section 7) on account thereof. The Company will forthwith mail a
copy of each such certificate to each holder of a Warrant and will, on the
written request at any time of any holder of a Warrant, furnish to such holder a
like certificate setting forth the calculations used to determine such
adjustment or readjustment. At its option, the holder of a Warrant may confirm
the adjustment noted on the certificate by causing such adjustment to be
computed by an independent certified public accountant at the expense of the
Company. The cost of any such confirmation shall be borne (x) by the Company, if
the computation of such independent certified public accountant indicates that
the adjustment noted on the Company's certificate was in any respect incorrect
to the detriment of the holders, and (y) otherwise, by the holder requesting
such confirmation.
10. NOTICES OF RECORD DATE.
-----------------------
In the event of:
(a) any taking by the Company of a record of the holders of any class
of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend or other distribution (including, without
limitation, any distribution that may arise as a result of a spin-off,
split-up, reclassification, recapitalization, combination of shares or similar
corporate restructuring), or any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other securities or property,
or to receive any other right;
(b) any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any transfer of all or
substantially all the assets of the Company to or any consolidation or merger
of the Company with or into any other Person;
7
<PAGE> 8
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company; or
(d) any proposed issuance or grant by the Company of any shares of
stock of any class or any other securities, or any right or option to subscribe
for, purchase or otherwise acquire any shares of stock of any class or any
other securities (other than the issuance of Common Stock on the exercise of
this Warrant),
then, and in each such event, the Company will mail or cause to be mailed to
the holder of this Warrant a notice specifying (i) the date on which any such
record is to be taken for the purpose of such dividend, distribution or right,
and stating the amount and character of such dividend, distribution or right,
(ii) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up is to take place and the time, if any, to be fixed, as of which the
holders of record of Common Stock (or Other Securities) shall be entitled to
exchange their shares of Common Stock (or Other Securities) for securities or
other property deliverable on such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up and (iii) the amount and character of any stock or other securities,
or rights or options with respect thereto, proposed to be issued or granted,
the date of such proposed issue or grant and the persons or class of persons to
whom such proposed issue or grant is to be offered or made. Such notice shall
be mailed at least twenty (20) days prior to the date specified in such notice
on which any such action is to be taken.
11. RESERVATION OF STOCK ISSUABLE ON EXERCISE OF WARRANT.
-----------------------------------------------------
The Company will at all times reserve and keep available, solely for
issuance and delivery on the exercise of the Warrant, a number of shares of
Convertible Non-Voting Common Stock equal to the total number of shares of
Convertible Non-Voting Common Stock from time to time issuable upon exercise of
this Warrant and the number of Other Securities which at any time may be
issuable hereunder, and, from time to time, will take all steps necessary to
amend its Certificate of Incorporation to provide sufficient reserves of shares
of Common Stock issuable upon exercise of the Warrant and upon the conversion of
shares of one class of Common Stock into shares of the other class of Common
Stock, as provided in its Certificate of Incorporation.
12. DEFINED TERMS.
--------------
As used herein the following terms, unless the context otherwise requires,
have the following respective meanings:
12.1. The term BANK AFFILIATE means any Person that is a bank holding
company or a subsidiary of a bank holding company as defined in the Bank Holding
Company Act of 1956, as amended, or other applicable banking laws of the United
States and the rules and regulations promulgated thereunder.
8
<PAGE> 9
12.2. The term COMPANY means Cryenco Sciences, Inc., the surviving
corporation of the merger of CHI into G&M, and any corporation which shall
succeed to or assume the obligations of the Company hereunder.
12.3. The term COMMON STOCK means (i) the Company's Voting Common Stock,
$.01 par value (the "Voting Common Stock"), (ii) the Company's Convertible
Non-Voting Common Stock, $.01 par value (the "Convertible Non-Voting Common
Stock"), (iii) any other capital stock of any class or classes (however
designated) of the Company the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of current
dividends and liquidating dividends after the payment of dividends and
distributions on any shares entitled to preference and (iv) any other securities
into which or for which any of the securities described in clauses (i), (ii) or
(iii) above have been converted, exchanged or combined pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise.
12.4. The term OTHER SECURITIES means any stock (other than Common Stock)
and other securities of the Company or any other entity (corporate or otherwise)
which (i) the holder of this Warrant at any time shall be entitled to receive,
or shall have received, on the exercise of this Warrant, in lieu of or in
addition to Common Stock, or (ii) at any time shall be issuable or shall have
been issued in exchange for or in replacement of Common Stock or Other
Securities, in each case pursuant to Section 5 or 6 hereof.
13. REMEDIES.
---------
The Company stipulates that the remedies at law of the holder of this
Warrant in the event of any default or threatened default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that such terms may be specifically enforced by a
decree for the specific performance of any agreement contained herein or by an
injunction against a violation of any of the terms hereof or otherwise.
14. NOTICES.
--------
All notices and other communications provided for or permitted hereunder
shall be made in writing (including facsimile transmission or other similar
writing) as follows: if to Chemical, to it at 277 Park Avenue, Floor 14, New
York, New York 10172 Attention: Patrick J. Ryan (telecopier no.: (212)
688-3859), with a copy to Kaye, Scholer, Fierman, Hays & Handler, 425 Park
Avenue, New York, New York 10022, Attention: Jeffrey Epstein, Esq. (telecopier
no.: (212) 836-8694); if to a subsequent holder of this Warrant, to it at such
address as may have been furnished to the Company in writing by such holder or,
until any such holder furnishes to the Company an address, then to, and at the
address of, the last holder of this Warrant who has so furnished an address to
the Company; and if to the Company, to it c/o Charterhouse Group International,
Inc. at 535 Madison Avenue 28th Floor, New York, New York 10022, Attention:
President (telecopier no.: (212) 750-9704) with a copy to Shack & Siegel, P.C.,
530 Fifth Avenue, New York, New York 10036, Attention: Jeffrey N. Siegel, Esq.
(telecopier no.: (212)
9
<PAGE> 10
730-1964); and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 14.
All such notices shall be deemed to have been duly given: (i) if delivered
personally, upon actual delivery, (ii) if delivered by mail, one Business Day
after deposited in the United States mail, overnight express mail, return
receipt requested, postage prepaid, or one Business Day after delivery to a
nationally recognized overnight express mail or courier service, or (iii) if
sent by facsimile transmission (or other similar writing), upon receipt of
telephonic or written confirmation thereof.
15. PUBLIC FILINGS, NASDAQ QUALIFICATION; AND MISCELLANEOUS.
---------------------------------------------------------
15.1. PUBLIC FILINGS AND NASDAQ QUALIFICATION. For so long as (i) this
Warrant is outstanding or (ii) the shares of Warrant Stock issuable upon the
exercise of this Warrant are outstanding and have not been registered or
transferred in reliance upon Rule 144 or Rule 144A, in each case as amended from
time to time under the Securities Act, or any successor provisions relating to
the resale of restricted securities without registration under Section 5 of the
Securities Act, the Company agrees to use its best efforts (A) to file timely
(whether or not it shall then be required to do so) such information, documents
and reports as the Commission may require or prescribe under Section 13 or 15(d)
(whichever is applicable) of the Exchange Act, (B) promptly upon request, to
furnish to any holder of this Warrant or the Warrant Stock a copy of the most
recent annual, current or quarterly report of the Company and such other
information which is provided to all stockholders of the Company generally, (C)
to file such other information, documents and reports as shall be required of it
hereafter by the Commission as a condition to the availability of Rule 144 or
144A, in each case as may be amended from time to time, under the Securities
Act, or any successor (but not additional) provisions relating to the resale of
restricted securities without registration under Section 5 of the Securities
Act, and (D) to maintain the quotation of its Common Stock on the National
Association of Securities Dealers, Inc. Automated Quotation System (bid and
asked) including, without limitation, using its best efforts to keep effective
the registration of its Common Stock under Section 12 of the Exchange Act and to
make timely payment of all applicable fees.
15.2. MISCELLANEOUS. In case any provision of this Warrant shall be
invalid, illegal or unenforceable, or partially invalid, illegal or
unenforceable, the provision shall be enforced to the extent, if any, that it
may legally be enforced and the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby. This
Warrant and any term hereof may be changed, waived, discharged or terminated
only by a statement in writing signed by the party against which enforcement of
such change, waiver, discharge or termination is sought. This Warrant shall be
governed by and construed in accordance with the
10
<PAGE> 11
domestic substantive laws (and not the conflict of law rules) of the State of
New York. The headings in this Warrant are for purposes of reference only, and
shall not limit or otherwise affect any of the terms hereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its duly authorteed officer and attested by its Secretary.
Dated as of April 27, 1992 CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
--------------------------
Name: Alfred Schechter
Title: Chairman
ATTEST:
/s/ James A. Raabe
- ----------------------
Name: James A. Raabe
Title: Secretary
11
<PAGE> 12
FORM OF SUBSCRIPTION
(To be signed only on exercise
of Common Stock Purchase Warrant)
TO: Cryenco Sciences, Inc.
The undersigned, the Holder of the within Common Stock Purchase Warrant,
hereby irrevocably elects to exercise this Common Stock Purchase Warrant for,
and to purchase thereunder, ____ shares of Convertible Non-Voting Common Stock
of Cryenco Sciences, Inc. and herewith [makes payment of $______ therefor]
[instructs you herein, in payment of the Exercise Price, to deduct ___ shares of
Convertible Non-Voting Common Stock and to deliver the net number of shares,
being ____ shares of Convertible Non-Voting Common Stock], and requests that the
certificates for such shares be issued in the name of, and delivered to _______
whose address is __________________________________________
Dated:
______________________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of the
Warrant)
_____________________________
(Address)
<PAGE> 13
FORM OF ASSIGNMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and transfers
unto _______ the right represented by the within Warrant to purchase ___ shares
of _______ Common Stock of Cryenco Sciences, Inc., a Delaware corporation, to
which the within Warrant relates, and appoints____________ attorney to transfer
such right on the books of Cryenco Sciences, Inc., with full power of
substitution in the premises.
[Name of Assignor]
Dated:___________ By:___________________
Title:_______________
[Address of Assignor]
Signed in the presence of:
__________________________
<PAGE> 1
Exhibit 4.4
AMENDMENT TO WARRANT AGREEMENT
This Amendment to Warrant Agreement is made as of this 31st day of July,
1997, by and between The Chase Manhattan Bank (formerly known as Chemical Bank)
(the "Holder"), Cryenco Sciences, Inc., a Delaware corporation (f/k/a Cryenco
Holdings, Inc.) ("Cryenco") and Chart Industries, Inc., a Delaware corporation
("Chart").
WHEREAS, the Holder and Cryenco, among others, are parties to a warrant
agreement dated as of August 30, 1991, as amended, and letter agreements dated
as of August 12, 1992 and August 31, 1993 (the "Warrant Agreement"), pursuant to
which Cryenco granted the Holder a warrant or warrants (the "Cryenco Warrants")
to purchase an aggregate of 43,403 shares of Cryenco Class B common stock, par
value $.01 per share (the "Cryenco Common Stock") (such 43,403 shares having
been adjusted to reflect the reverse stock split of Cryenco Common Stock
effective August 13, 1992 and the antidilution adjustments triggered by
Cryenco's Private Placement and related transactions with International Capital
Partners, Inc. which occurred in December 1994, January 1995 and June 1995);
WHEREAS, Cryenco and Chart entered into a Plan and Agreement of Merger
dated as of April 30, 1997 (the "Merger Agreement") providing for the merger of
an affiliate of Chart into Cryenco (the "Merger") and the conversion of all
issued and outstanding Cryenco Common Stock (other than dissenters' shares) into
cash in the amount of $2.75 per share;
WHEREAS, in Section 5.4(b)(iii) of the Merger Agreement, Chart has agreed
to offer to grant substitute warrants (the "Chart Warrants") to purchase shares
of Chart's common stock, par value $.01 per share (the "Chart Common Stock), in
exchange for the Cryenco Warrants; and
WHEREAS, the Holder, Cryenco and Chart now desire that, in satisfaction of
Chart's obligations under Section 5.4(b)(iii) of the Merger Agreement, the
Cryenco Warrants be amended to provide the Holder with the right to purchase
Chart Common Stock in substitution for the right to purchase Cryenco Common
Stock.
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements and undertakings set forth herein, the parties hereby agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall have
the meaning ascribed to them in the Merger Agreement.
2. AMENDMENT. As of the effective time of the Merger (the "Effective
Time"), the Warrant Agreement and the Cryenco Warrants issued thereunder are
hereby amended as follows:
(a) CHART COMMON STOCK SUBSTITUTED FOR CRYENCO COMMON STOCK. All
references to the right of the Holder to purchase shares of
Cryenco
<PAGE> 2
Common Stock shall be deemed to be the right to purchase shares of
Chart Common Stock.
(b) ADJUSTMENT TO NUMBER OF SHARES UNDERLYING WARRANT. The number
of shares of Chart Common Stock issuable upon exercise of each
Chart Warrant which is issued in substitution for a Cryenco
Warrant shall be the product of (i) the number of shares of
Cryenco Common Stock that were issuable upon exercise of the
corresponding Cryenco Warrant immediately prior to the
Effective Time times (ii) a fraction (the "Exchange Ratio")
the numerator of which shall be $2.75 and the denominator of
which shall be the average of the closing sales price of Chart
Common Stock on the New York Stock Exchange as reported by the
Wall Street Journal for the ten trading days immediately
preceding the Effective Time; provided, however, that in no
event shall the Exchange Ratio be less than .165 nor more than
.206.
(c) ADJUSTMENT TO PURCHASE OR EXERCISE PRICE. The purchase or
exercise price per share of Chart Common Stock subject to a
Chart Warrant shall be equal to (i) the purchase or exercise
price per share of Cryenco Common Stock in the corresponding
Cryenco Warrant divided by (ii) the Exchange Ratio.
(d) NOTICES. Any notices, requests, forms, certificates or other
documents or communications deliverable to Cryenco under the
Warrant Agreement shall be required to be delivered instead to
Chart at 35555 Curtis Boulevard, Eastlake, OH 44095, to the
attention of the Chief Financial Officer, with a copy to
Calfee, Halter & Griswold LLP, 1400 McDonald Investment
Center, 800 Superior Avenue, Cleveland, OH 44114, Attention:
Thomas F. McKee.
(e) SUBSTITUTION OF WARRANTS. Chart and the Holder agree that any
and all Cryenco Warrants and/or Cryenco Warrant certificates
issued pursuant to the Warrant Agreement shall be amended in a
manner consistent with the provisions of this Amendment and
that, upon the Holder's presentation to Chart of such Cryenco
Warrants or Cryenco Warrant certificates, Chart shall deliver
to the Holder, in exchange and substitution therefor, new
Chart Warrants or Chart Warrant certificates.
3. FULL COMPLIANCE: ASSUMPTION OF CRYENCO'S OBLIGATIONS: REFERENCES TO
CRYENCO. The Holder acknowledges and agrees that, as of the Effective Time,
Cryenco is in full compliance with all of its obligations under the Warrant
Agreement, the Cryenco Warrants and any related agreements pertaining to
registration rights of the Holder with respect to the shares of Cryenco Common
Stock issuable upon exercise of the Cryenco Warrants. As of the Effective Time,
Chart assumes all of the obligations of Cryenco under the Warrant Agreement as
amended
-2-
<PAGE> 3
hereby, and all references to Cryenco in the Warrant Agreement shall be deemed
to be references to Chart. To the extent that Holder is party to a separate
registration rights agreement relating to Cryenco Common Stock, promptly after
the Effective Time, Chart and the Holder shall enter into such supplemental
agreement as may be necessary to provide the Holder with equivalent registration
rights relating to Chart Common Stock issuable upon exercise of the Chart
Warrants.
4. RECEIPT OF CHART DISCLOSURES. The Holder acknowledges that it has
received copies of Chart's 1996 Form 10-K Report and Chart's Form 1O-Q Report
for the three-month period ended March 31, 1997.
5. NO RIGHT TO PURCHASE CRYENCO COMMON STOCK. At and after the Effective
Time, the Holder shall be deemed to have surrendered any and all rights under
the Warrant Agreement and Warrant to purchase Cryenco Common Stock.
6. CONSENT TO AMENDMENT. By the execution and delivery of this and
Amendment, the Holder shall be deemed to have consented to the terms hereof in
accordance with the terms of the Warrant Agreement.
7. NO OTHER AMENDMENTS. Except as specifically provided herein or as
otherwise necessary or appropriate to effectuate the intent of this Amendment,
the provisions of the Cryenco Warrant shall remain in full force and effect
without any alteration or modification thereto. Without limiting the generality
of the foregoing, the date of grant and the date of termination of the Cryenco
Warrant shall continue to be such dates as were in effect immediately prior to
the Effective Time.
8. SUCCESSORS AND ASSIGNS. This Amendment and all of the provisions
hereof shall be binding on and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
9. GOVERNING LAW. This Amendment shall be, and the Warrant Agreement
shall be amended to provide that it shall be, governed by and construed in
accordance with, the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
10. SEVERABILITY. If any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held to be invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
11. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same instrument.
-3-
<PAGE> 4
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first written above.
CHART INDUSTRIES, INC.
/s/ Don A. Baines
Attest: /s/ John T. Romain ---------------------------
----------------------- By: Don A. Baines
Title: CFO and Treasurer
THE CHASE MANHATTAN BANK (formerly
known as CHEMICAL BANK)
Attest: By: /s/ Paula M. Carr
----------------------- --------------------------
By: Paula M. Carr
Title: Vice President
CRYENCO SCIENCES, INC.
Attest:
----------------------- ---------------------------
By: James A. Raabe
Title: Vice President
-4-
<PAGE> 1
Exhibit 4.5
Right to purchase 32,195* Shares
of Convertible Non-Voting
Common Stock of Cryenco Sciences, Inc.
THIS WARRANT HAS NOT BEEN, AND ANY SHARES ACQUIRED UPON THE EXERCISE OF
THIS WARRANT WILL NOT BE, REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN EXEMPTION THEREFROM UNDER SUCH ACT OR ANY APPLICABLE STATE SECURITIES
LAWS. FURTHERMORE, THIS WARRANT MAY BE SOLD OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE CONDITIONS SPECIFIED IN SECTION 21 OF THE AGREEMENT REFERRED
TO HEREINAFTER, A COMPLETE AND CORRECT COPY OF WHICH IS AVAILABLE FOR INSPECTION
AT THE PRINCIPAL OFFICE OF CRYENCO SCIENCES, INC. AND WILL BE FURNISHED WITHOUT
CHARGE TO THE HOLD OF THIS WARRANT UPON WRITTEN REQUEST.
Cryenco Sciences, Inc.
Common Stock Purchase Warrant
Cryenco Sciences, Inc., a Delaware corporation (the "Company"), hereby
certifies that, for value received, The CIT Group/Equity Investments, Inc., a
New Jersey corporation ("CIT"), or its transferees, successors and assigns, is
entitled, subject to the terms set forth below, to purchase from the Company at
any time or from time to time after the date hereof and prior to the expiration
hereof pursuant to Section 2.4 hereof, 32,195* fully paid and non-assessable
shares of Convertible Non-Voting Common Stock (as defined in Section 12 hereof),
at an initial purchase price per share of $4.84951 * (such price per share as
adjusted from time to time as provided herein is referred to herein as the
"Exercise Price"). The number and character of such shares of Common Stock and
the Exercise Price are subject to adjustment as provided herein.
________________
* As adjusted to reflect the reverse stock split of the Company's Common
Stock effective August 13, 1992 and the antidilution adjustments
triggered by the Company's Private Placement and related transactions
with International Capital Partners, Inc. which occurred in December 1994,
January 1995 and June 1995.
<PAGE> 2
This Warrant supersedes and replaces a Warrant dated April 27, 1992 and
is issued pursuant to that certain letter agreement dated August 12, 1992,
between the Company and CIT, amending certain agreements including the
Securities Purchase Agreement dated as of August 30, 1991, as amended (the
"Agreement"), among the Company (as the surviving corporation in the merger of
Cryenco Holdings, Inc. with and into Gulf & Mississippi Corporation), Cryenco,
Inc. (as the surviving corporation in the merger of Cryogenic Energy Company
with and into CEC Acquisition Corp.) and CIT, copies of which are on file at
the principal office of the Company. The holder of this Warrant shall be
entitled to all of the benefits and shall be subject to all of the obligations
of the Agreement relating to the CHI Warrant (as such term is defined in the
Agreement) as provided therein as amended to date, as if this Warrant were
substituted therefor.
1. DEFINITIONS.
------------
Terms defined in the Agreement and not otherwise defined herein shall
have the meanings assigned thereto in the Agreement. Certain terms used in this
Warrant are specifically defined in Section 12 hereof.
2. EXERCISE OF WARRANT.
--------------------
2.1. IN GENERAL. This Warrant may be exercised in whole or in part by the
holder hereof at any time or from time to time prior to its expiration by
surrender of this Warrant, with the form of subscription at the end hereof duly
executed by such holder, to the Company at its principal office, accompanied by
payment, by certified or official bank check payable to the order of the
Company or by wire transfer to its account in the amount obtained by
multiplying the number of shares of Common Stock for which this Warrant is then
being exercised by the Exercise Price then in effect; PROVIDED, HOWEVER, that
the holder hereof shall have the right, at its election, in lieu of delivering
the Exercise Price in cash, to instruct the Company in the form of subscription
to retain, in payment of the Exercise Price, a number of shares of Common Stock
(the "Payment Shares") equal to the quotient of (i) the aggregate Exercise
Price of the shares as to which this Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct the
number of Payment Shares from the shares to be delivered to the holder hereof.
"Average Closing Price" means, as of any date, (x) if shares of Voting Common
Stock are listed on a national securities exchange, the average of the closing
sales prices therefor on the largest securities exchange on which such shares
are traded on the last ten (10) trading days before such date, (y) if such
shares are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last ten (10) trading days before such
date or (z) if such shares are not listed on either a national securities
exchange or the NASDAQ National Market System, the average of the sales prices
therefor on the last twenty (20) trading days before such date. In the event
the Warrant is not exercised in full, the Company, at its expense, will
forthwith issue and deliver to or upon the order of the holder hereof a new
Warrant or Warrants of like tenor, in the name of the holder hereof or as such
holder (upon payment by such holder of any applicable transfer taxes) may
request, calling in
2
<PAGE> 3
the aggregate on the face or faces thereof for the number of shares of Common
Stock equal (without giving effect to any adjustment therein) to the number of
such shares called for on the face of this Warrant minus the number of such
shares (without giving effect to any adjustment therein) for which this Warrant
shall have been exercised.
2.2. Intentionally Omitted
2.3. CONFLICT WITH OTHER LAWS. Any other provisions hereof to the
contrary notwithstanding, no Bank Affiliate shall be entitled to exercise the
right under this Warrant to purchase any share or shares of Common Stock if,
under any law or under any regulation, rule or other requirement of any
governmental authority at any time applicable to such Bank Affiliate, (a) as a
result of such purchase, such Bank Affiliate would own, control or have power to
vote a greater quantity of securities of any kind than the Bank Affiliate shall
be permitted to own, control or have power to vote or (b) such purchase would
not be permitted. For purposes of this Section 2.3, a written certification of
the Bank Affiliate exercising this Warrant, delivered upon surrender of the
Warrant pursuant to the Agreement, to the effect that the Bank Affiliate is
legally entitled to exercise its right under this Warrant to purchase
securities and that such purchase will not violate the prohibitions set forth
in the preceding sentence, shall be conclusive and binding upon the Company and
shall obligate the Company to deliver certificates representing the shares of
Common Stock so purchased in accordance with the other provisions hereof and
shall relieve the Company of any liability under this Section 2.3.
2.4. TERMINATION OF THE WARRANT. This Warrant shall terminate upon the
earlier to occur of (i) August 29, 2003 and (ii) the exercise in full.
3. PUT OPTION; REGISTRATION RIGHTS.
--------------------------------
The holder of this Warrant has the option to require the Company to
purchase this Warrant and/or shares of Warrant Stock at the times and in the
manner specified in the Agreement, except that this option shall not apply with
respect to Section 16.1(a) (including with reference to Sections 15.2(b) and
(c) and 16.5) of the Agreement and Section 11.6 of the Warrant Agreement dated
as of August 30, 1991, as amended, among the Company (as the surviving
corporation in the merger of Cryenco Holdings, Inc. with and into Gulf &
Mississippi Corporation), Cryenco, Inc. (as the surviving corporation in the
merger of Cryenco Energy Company with and into CEC Acquisition Corp.) and
Chemical Bank; provided, however, that the automatic exercise of such put
rights as provided in Section 15.2(b) or (c) of the Agreement shall continue to
apply to the extent such rights occur as a result of a default under Section
15.1(k)(i), (ii) or (iv) of the Agreement (except that with respect to Section
15.1(k)(iv), the words "or insolvent" in subparagraph (x) of such section
shall be deemed to be deleted for purposes of this provision only). The holder
of this Warrant has the right to cause the Company to register shares of
Warrant Stock, and any shares issued upon exercise hereof, under the Securities
Act and any blue sky or securities laws of any jurisdictions within the United
States at the time and in the manner specified in the Registration Rights
Agreement.
3
<PAGE> 4
4. DELIVERY OF STOCK CERTIFICATES ON EXERCISE.
-------------------------------------------
As soon as practicable after the exercise of this Warrant in full or in
part, and in any event within twenty (20) days thereafter, the Company at its
expense (including the payment by it of any applicable issue taxes) will cause
to be issued in the name of and delivered to the holder hereof, or as such
holder (upon payment by such holder of any applicable transfer taxes) may
direct, a certificate or certificates for the number of fully paid and
non-assessable shares of Common Stock (or Other Securities) which such holder
shall be entitled to receive on such exercise, together with any other stock or
other securities and property (other than cash) which such holder is entitled
to receive upon such exercise.
5. ADJUSTMENT FOR DIVIDENDS, DISTRIBUTIONS AND RECLASSIFICATIONS.
--------------------------------------------------------------
In case at any time or from time to time the holders of Common Stock
shall have received or (on or after the record date fixed for the determination
of shareholders eligible to receive) shall have become entitled to receive,
without payment therefor:
(a) other or additional stock or other securities or property (other than
cash) by way of dividend; or
(b) other or additional stock or other securities or property (other than
cash) by way of spin-off, split-up, reclassification, recapitalization,
combination of shares or similar corporate restructuring;
OTHER THAN additional shares of Common Stock issued in a stock split or other
reclassification, recapitalization or similar corporate restructuring of the
Company's Common Stock (adjustments in respect of which are provided for in
Section 7.1 hereof), then and in each such case the holder of this Warrant, on
the exercise hereof as provided in Section 2 hereof, shall be entitled to
receive the amount of stock and other securities and property (other than cash)
which such holder would have received prior to, or would have held on the date
of, such exercise if on the date hereof he had been the holder of record of the
number of shares of Common Stock called for on the face of this Warrant and had
thereafter, during the period from the date hereof to and including the date of
such exercise, retained such shares and all such other or additional stock and
other securities and property (other than cash) receivable by such holder as
aforesaid during such period, giving effect to all further adjustments called
for during such period by Sections 6 and 7 hereof. The Company hereby agrees
that it will at all times reserve and keep available for such holder, solely
for delivery upon the exercise of this Warrant, any distribution to which such
holder is entitled under this Section 5.
6. ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC.
----------------------------------------------------------
6.1. CERTAIN ADJUSTMENTS. In case at any time or from time to time, the
Company shall (i) effect a capital reorganization, reclassification or
recapitalization, (ii) consolidate with or
4
<PAGE> 5
merge into any other Person or (iii) transfer all or substantially all of its
properties or assets to any other Person under any plan or arrangement
contemplating the dissolution of the Company, then in each such case, the
holder of this Warrant, on the exercise hereof as provided in Section 2 hereof
at any time after the consummation of such reorganization, reclassification,
recapitalization, consolidation, merger or transfer, or the effective date of
such dissolution, as the case may be, shall receive, in lieu of the Common
Stock (or Other Securities) issuable on such exercise prior to such
consummation or effective date, the stock and other securities and property
(including cash) to which such holder would have been entitled upon such
consummation or in connection with such dissolution, as the case may be, if
such holder had so exercised this Warrant immediately prior thereto, all
subject to further adjustment thereafter as provided in Sections 5 and 7
hereof.
6.2. CONTINUATION OF TERMS. Upon any reorganization, reclassification,
recapitalization, consolidation, merger or transfer referred to in this Section
6, this Warrant shall continue in full force and effect and the terms hereof
shall be applicable to the shares of stock and Other Securities and property
receivable on the exercise of this Warrant after the consummation of such
reorganization, reclassification, recapitalization, consolidation or merger, as
the case may be, and shall be binding upon the issuer of any such stock or
Other Securities, including, in the case of any such transfer, the Person
acquiring all or substantially all of the properties or assets of the Company,
whether or not such Person shall have expressly assumed the terms of this
Warrant as provided in Section 8 hereof.
7. ADJUSTMENTS FOR ISSUANCE OF COMMON STOCK AND AMOUNT OF
OUTSTANDING COMMON STOCK.
-------------------------
7.1. IN GENERAL. If at any time there shall occur any stock split, stock
dividend, reverse stock split or other subdivision, reclassification,
recapitalization, recombination of shares or similar corporate restructuring of
the Company's Common Stock, any rights offering by the Company to its existing
stockholders or any issuance by the Company of Additional Shares of Common
Stock upon the exercise of Convertible Securities (each as defined in Section
7.2 hereof) granted before the consummation of the G&M Merger, other than any
such shares issued upon the exercise of options granted to Thomas A. Trantum
before August 30, 1991 (each, a "Stock Event"), then the number of shares of
Common Stock to be received by the holder of this Warrant shall be
appropriately adjusted such that the proportion of the number of shares
issuable hereunder to the total number of outstanding shares of the Company
(calculated on a Fully-Diluted Basis) prior to such Stock Event is equal to the
proportion of the number of shares issuable hereunder after such Stock Event to
the total number of outstanding shares of the Company after such Stock Event
(calculated on a Fully-Diluted Basis). No adjustment to the Exercise Price
shall be made in connection with any adjustment of the number of shares of
Common Stock receivable upon exercise of this Warrant, except that the Exercise
Price shall be proportionately increased or decreased upon the occurrence of
any event provided for in this Section 7.1 so that the aggregate Exercise Price
for all shares of Common Stock covered hereby shall remain unchanged.
5
<PAGE> 6
7.2. ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. If at any time the
Company shall issue or sell (i) any Additional Shares of Common Stock in
exchange for consideration in an amount per Additional Share of Common Stock
less than the Fair Market Value Per Share of Common Stock at the time the
Additional Shares of Common Stock are issued or sold or (ii) any Convertible
Securities having an exercise price or Conversion Price (as defined below) in
an amount per share of Common Stock less than the Fair Market Value Per Share
of Common Stock at the time of such issuance or sale, then the number of shares
of Common Stock for which this Warrant is exercisable shall be adjusted to
equal the product obtained by multiplying the number of shares of Common Stock
for which this Warrant is exercisable immediately prior to such issuance or
sale by a fraction (a) the numerator of which shall be the number of shares of
Common Stock outstanding immediately after such issuance or sale (assuming the
conversion or exercise of all such Convertible Securities) and (b) the
denominator of which shall be the number of shares of Common Stock outstanding
immediately prior to such issuance or sale plus either (x) the number of shares
which the aggregate offering price of the total number of such Additional
Shares of Common Stock would purchase at the then Fair Market Value Per Share
or (y) the number of shares of Common Stock which could be purchased if the
exercise price of such Convertible Security or the Conversion Price of such
Convertible Security (as applicable) were set at the then Fair Market Value Per
Share. Thereupon, the Exercise Price shall be correspondingly reduced so that
the aggregate Exercise Price for all shares of Common Stock covered hereby
shall remain unchanged. No adjustments shall be made upon the exercise or
conversion of Convertible Securities. For purposes of this paragraph, (i) the
term "Additional Shares of Common Stock" means any shares of Common Stock
issued by the Company after the Closing Date other than Warrant Stock or stock
issuable upon the exercise of options granted to Thomas A. Trantum before
August 30, 1991, (ii) the term "Convertible Securities" means all options,
warrants or securities exercisable for, all rights to subscribe for, and all
securities which are convertible into or exchangeable for, Common Stock and
(iii) the term "Conversion Price" means, with respect to any Convertible
Security, the price paid for such Convertible Security divided by the number of
shares of Common Stock into which such Convertible Security is convertible on
the date of issuance of such Convertible Security.
8. NO DILUTION OR IMPAIRMENT.
--------------------------
The Company will not, by amendment of its Certificate of Incorporation or
through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid
or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder of this Warrant
hereunder. Without limiting the generality of the foregoing, the Company (i)
will not increase the par value of any shares of stock receivable on the
exercise of the Warrant above the amount payable therefor on such exercise,
(ii) will take all such action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and non-assessable shares
of stock on the exercise of the Warrant from time to time outstanding, (iii)
will not issue any capital stock of any class which is preferred as to
dividends or as to the distribution of assets upon voluntary or involuntary
dissolution,
6
<PAGE> 7
liquidation or winding up, unless the rights of the holders thereof shall be
limited to a fixed sum or percentage of par value in respect of participation
in dividends and in any such distribution of assets and (iv) will not transfer
all or substantially all of its properties and assets to any other entity
(corporate or otherwise) or consolidate with or merge into any other entity or
permit any such entity to consolidate with or merge into the Company (if the
Company is not the surviving entity), unless such other entity shall expressly
assume in writing and will be bound by all the terms of this Warrant and the
Agreement. If any event occurs as to which the provisions of Sections 5, 6 or 7
hereof are strictly applicable and the application thereof would not, in the
good faith judgment of the Board of Directors of the Company, fairly protect
the purchase rights of the Warrants in accordance with the essential intent and
principles of such provisions, then such Board shall make such adjustments in
the application of such provisions, in accordance with such essential intent
and principles, as shall be reasonably necessary, in the good faith opinion of
such Board, to protect such purchase rights as aforesaid, but in no event shall
any such adjustment have the effect of increasing the Exercise Price or
decreasing the number of shares of Common Stock subject to purchase upon
exercise of this Warrant. Nothing contained in this Warrant shall prohibit the
Company from issuing or selling securities in the future.
9. ACCOUNTANTS' CERTIFICATE AS TO ADJUSTMENTS.
-------------------------------------------
In each case of any event that may require any adjustment or readjustment
in the shares of Common Stock (or Other Securities) issuable on the exercise of
this Warrant, the Company at its expense will promptly prepare a certificate
setting forth such adjustment or readjustment and showing, in detail, the facts
upon which any such adjustment or readjustment is based, including a statement
of (i) the number of shares of the Company's Common Stock then outstanding on a
Fully-Diluted Basis, and (ii) the number of shares of Common Stock (or Other
Securities) to be received upon exercise of this Warrant (A) immediately prior
to such adjustment or readjustment and (B) as adjusted and readjusted (if
required by Section 7 hereof) on account thereof. The Company will forthwith
mail a copy of each such certificate to each holder of a Warrant and will, on
the written request at any time of any holder of a Warrant, furnish to such
holder a like certificate setting forth the calculations used to determine such
adjustment or readjustment. At its option, the holder of a Warrant may confirm
the adjustment noted on the certificate by causing such adjustment to be
computed by an independent certified public accountant at the expense of the
Company. The cost of any such confirmation shall be borne (x) by the Company,
if the computation of such independent certified public accountant indicates
that the adjustment noted on the Company's certificate was in any respect
incorrect to the detriment of the holders, and (y) otherwise, by the holder
requesting such confirmation.
10. NOTICES OF RECORD DATE.
-----------------------
In the event of:
(a) any taking by the Company of a record of the holders of any class of
securities for the purpose of determining the holders thereof who are entitled
to receive any dividend or other distribution (including, without limitation,
any distribution that may arise as a result of a
7
<PAGE> 8
spin-off, split-up, reclassification, recapitalization, combination of shares
or similar corporate restructuring), or any right to subscribe for, purchase or
otherwise acquire any shares of stock of any class or any other securities or
property, or to receive any other right;
(b) any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any transfer of all or
substantially all the assets of the Company to or any consolidation or merger
of the Company with or into any other Person;
(c) any voluntary or involuntary dissolution, liquidation or winding-up
of the Company; or
(d) any proposed issuance or grant by the Company of any shares of stock
of any class or any other securities, or any right or option to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities (other than the issuance of Common Stock on the exercise of this
Warrant), then, and in each such event, the Company will mail or cause to be
mailed to the holder of this Warrant a notice specifying (i) the date on which
any such record is to be taken for the purpose of such dividend, distribution
or right, and stating the amount and character of such dividend, distribution
or right, (ii) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up is to take place and the time, if any, to be fixed, as of which the
holders of record of Common Stock (or Other Securities) shall be entitled to
exchange their shares of Common Stock (or Other Securities) for securities or
other property deliverable on such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up and (iii) the amount and character of any stock or other securities,
or rights or options with respect thereto, proposed to be issued or granted,
the date of such proposed issue or grant and the persons or class of persons to
whom such proposed issue or grant is to be offered or made. Such notice shall
be mailed at least twenty (20) days prior to the date specified in such notice
on which any such action is to be taken.
11. RESERVATION OF STOCK ISSUABLE ON EXERCISE OF WARRANT.
-----------------------------------------------------
The Company will at all times reserve and keep available, solely for
issuance and delivery on the exercise of the Warrant, a number of shares of
Convertible Non-Voting Common Stock equal to the total number of shares of
Convertible Non-Voting Common Stock from time to time issuable upon exercise of
this Warrant and the number of Other Securities which at any time may be
issuable hereunder, and, from time to time, will take all steps necessary to
amend its Certificate of Incorporation to provide sufficient reserves of shares
of Common Stock issuable upon exercise of the Warrant and upon the conversion
of shares of one class of Common Stock into shares of the other class of Common
Stock, as provided in its Certificate of Incorporation.
12. DEFINED TERMS.
--------------
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
8
<PAGE> 9
12.1. The term BANK AFFILIATE means any Person that is a bank holding
company or a subsidiary of a bank holding company as defined in the Bank
Holding Company Act of 1956, as amended, or other applicable banking laws of
the United States and the rules and regulations promulgated thereunder.
12.2. The term COMPANY means Cryenco Sciences, Inc., the surviving
corporation of the merger of CHI into G&M and any corporation which shall
succeed to or assume the obligations of the Company hereunder.
12.3. The term COMMON STOCK means (i) the Company's Voting Common Stock,
$.01 par value (the "Voting Common Stock"), (ii) the Company's Convertible
Non-Voting Common Stock, $.01 par value (the "Convertible Non-Voting Common
Stock"), (iii) any other capital stock of any class or classes (however
designated) of the Company the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of current
dividends and liquidating dividends after the payment of dividends and
distributions on any shares entitled to preference and (iv) any other
securities into which or for which any of the securities described in clauses
(i), (ii) or (iii) above have been converted, exchanged or combined pursuant to
a plan of recapitalization, reorganization, merger, sale of assets or
otherwise.
12.4. The term OTHER SECURITIES means any stock (other than Common Stock)
and other securities of the Company or any other entity (corporate or
otherwise) which (i) the holder of this Warrant at any time shall be entitled
to receive, or shall have received, on the exercise of this Warrant, in lieu of
or in addition to Common Stock, or (ii) at any time shall be issuable or shall
have been issued in exchange for or in replacement of Common Stock or Other
Securities, in each case pursuant to Section 5 or 6 hereof.
13. REMEDIES.
---------
The Company stipulates that the remedies at law of the holder of this
Warrant in the event of any default or threatened default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that such terms may be specifically enforced by a
decree for the specific performance of any agreement contained herein or by an
injunction against a violation of any of the terms hereof or otherwise.
14. NOTICES.
--------
All notices and other communications provided for or permitted hereunder
shall be made in writing (including facsimile transmission or other similar
writing) as follows: if to CIT, to it at 650 CIT Drive, Livingston, New Jersey,
07039-5795 Attention: Colby Collier (telecopier no.: (201) 740-5555), with a
copy to Schulte Roth & Zabel, 900 Third Avenue, New York, New York 10022,
Attention: Marc Weingarten, Esq. (telecopier no.: (212) 593-5955); if to a
subsequent holder of this Warrant, to it at such address as may have been
furnished to the Company in writing by such holder or, until any such holder
furnishes to the Company an
9
<PAGE> 10
address, then to, and at the address of, the last holder of this Warrant who
has so furnished an address to the Company; and if to the Company, to it c/o
Charterhouse Group International, Inc. at 535 Madison Avenue - 28th Floor, New
York, New York 10022, Attention: President (telecopier no.: (212) 750-9704)
with a copy to Shack & Siegel, P.C., 530 Fifth Avenue, New York, New York
10036, Attention; Jeffrey N. Siegel, Esq. (telecopier no.: (212)730-1964); and
thereafter at such other address, notice of which is given in accordance with
the provisions of this Section 14.
All such notices shall be deemed to have been duly given: (i) if
delivered personally, upon actual delivery, (ii) if delivered by mail, one
Business Day after deposited in the United States mail, overnight express mail,
return receipt requested, postage prepaid, or one Business Day after delivery
to a nationally recognized overnight express mail or courier service, or (iii)
if sent by facsimile transmission (or other similar writing), upon receipt of
telephonic or written confirmation thereof.
15. PUBLIC FILINGS, NASDAQ QUALIFICATION; AND MISCELLANEOUS.
---------------------------------------------------------
15.1. PUBLIC FILINGS AND NASDAQ QUALIFICATION. For so long as (i) this
Warrant is outstanding or (ii) the shares of Warrant Stock issuable upon the
exercise of this Warrant are outstanding and have not been registered or
transferred in reliance upon Rule 144 or Rule 144A, in each case as amended
from time to time under the Securities Act, or any successor provisions
relating to the resale of restricted securities without registration under
Section 5 of the Securities Act, the Company agrees to use its best efforts (A)
to file timely (whether or not it shall then be required to do so) such
information, documents and reports as the Commission may require or prescribe
under Section 13 or 15(d) (whichever is applicable) of the Exchange Act, (B)
promptly upon request, to furnish to any holder of this Warrant or the Warrant
Stock a copy of the most recent annual, current or quarterly report of the
Company and such other information which is provided to all stockholders of the
Company generally, (C) to file such other information, documents and reports as
shall be required of it hereafter by the Commission as a condition to the
availability of Rule 144 or 144A, in each case as may be amended from time to
time, under the Securities Act, or any successor (but not additional)
provisions relating to the resale of restricted securities without registration
under Section 5 of the Securities Act, and (D) to maintain the quotation of its
Common Stock on the National Association of Securities Dealers, Inc. Automated
Quotation System (bid and asked) including, without limitation, using its best
efforts to keep effective the registration of its Common Stock under Section 12
of the Exchange Act and to make timely payment of all applicable fees.
15.2. MISCELLANEOUS. In case any provision of this Warrant shall be
invalid, illegal or unenforceable, or partially invalid, illegal or
unenforceable, the provision shall be enforced to the extent, if any, that it
may legally be enforced and the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby. This
Warrant and any term hereof may be changed, waived, discharged or terminated
only by a statement in writing signed by the party against which enforcement
of such change, waiver, discharge or termination is sought. This Warrant shall
be governed by and construed in accordance with the
10
<PAGE> 11
domestic substantive laws (and not the conflict of law rules) of the State of
New York. The headings in this Warrant are for purposes of reference only, and
shall not limit or otherwise affect any of the terms hereof.
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by
its duly authorized officer and attested by its Secretary.
Dated as of April 27, 1992 CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
-------------------------
Name: Alfred Schechter
Title: Chairman
ATTEST:
/s/ James A. Raabe
- ----------------------
Name: James A. Raabe
Title: Secretary
11
<PAGE> 12
FORM OF SUBSCRIPTION
(To be signed only on exercise
of Common Stock Purchase Warrant)
TO: Cryenco Sciences, Inc.
The undersigned, the Holder of the within Common Stock Purchase Warrant,
hereby irrevocably elects to exercise this Common Stock Purchase Warrant for,
and to purchase thereunder, _____ shares of Convertible Non-Voting Common Stock
of Cryenco Sciences, Inc. and herewith [makes payment of $_____ therefor]
[instructs you herein, in payment of the Exercise Price, to deduct ___ shares
of Convertible Non-Voting Common Stock and to deliver the net number of shares,
being ____ shares of Convertible Non-Voting Common Stock], and requests that the
certificates for such shares be issued in the name of, and delivered to
________, whose address is ____________.
Dated:
____________________________________
(Signature must conform in all respects to name
of Holder as specified on the face of the Warrant)
____________________________________
(Address)
12
<PAGE> 13
FORM OF ASSIGNMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and transfers
unto ___ the right represented by the within Warrant to purchase ___ shares of
Convertible Non-Voting Common Stock of Cryenco Sciences, Inc., a Delaware
corporation, to which the within Warrant relates, and appoints _____________
attorney to transfer such right on the books of Cryenco Sciences, Inc., with
full power of substitution in the premises.
[Name of Assignor]
Dated:__________ By: ________________________
Title: _________________________
[Address of Assignor]
Signed in the presence of:
___________________
13
<PAGE> 1
Exhibit 4.6
Right to Purchase 18,042* Shares of Voting
Common Stock of Cryenco Sciences, Inc.
THIS WARRANT HAS NOT BEEN, AND ANY SHARES ACQUIRED UPON THE EXERCISE OF
THIS WARRANT WILL NOT BE, REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION
OR AN EXEMPTION THEREFROM UNDER SUCH ACT OR ANY APPLICABLE STATE SECURITIES
LAWS. FURTHERMORE, THIS WARRANT MAY BE SOLD OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE CONDITIONS SPECIFIED IN SECTION 21 OF THE AGREEMENT
REFERRED TO HEREINAFTER, A COMPLETE AND CORRECT COPY OF WHICH IS AVAILABLE
FOR INSPECTION AT THE PRINCIPAL OFFICE OF CRYENCO SCIENCES, INC. AND WILL BE
FURNISHED WITHOUT CHARGE TO THE HOLDER OF THIS WARRANT UPON WRITTEN REQUEST.
Cryenco Sciences, Inc.
Common Stock Purchase Warrant
Cryenco Sciences, Inc., a Delaware corporation (the "Company"), hereby
certifies that, for value received, The CIT Group/Equity Investments, Inc., a
New Jersey corporation ("CIT"), or its transferees, successors and assigns, is
entitled, subject to terms set forth below, to purchase from the Company at any
time or from time to time after the date hereof and prior to the expiration
hereof pursuant to Section 2.4 hereof, 18,042* fully paid and non-assessable
shares of Voting Common Stock (as defined in Section 12 hereof), at an initial
purchase price per share of $6.18834* (such price per share as adjusted from
time to time as provided herein is referred to herein as the "Exercise Price").
The number and character of such shares of Common Stock and the Exercise Price
are subject to adjustment as provided herein.
This Warrant is issued pursuant to that certain letter agreement dated as
of October 31, 1993, among the Company, Cryenco, Inc. and CIT, amending the
Securities Purchase Agreement dated as of August 30, 1991, as amended (the
"Agreement"), among the Company (as the surviving corporation in the merger of
Cryenco Holdings, Inc. with and into Gulf and Mississippi Corporation),
Cryenco, Inc. (as the surviving corporation in the merger of Cryogenic Energy
Company with and into CEC Acquisition Corp.) and CIT, copies of which are on
file at the principal office of the Company. The holder of this Warrant shall
be entitled
____________________
* As adjusted to reflect the antidilution adjustments triggered by
the Company's Private Placement and related transactions with
International Capital Partners, Inc. which occurred in December
1994, January 1995 and June 1995.
<PAGE> 2
to all of the benefits and shall be subject to all of the obligations of the
Agreement relating to the Warrants (as such term is defined in the Agreement)
as provided therein as amended to date.
1. DEFINITIONS.
------------
Terms defined in the Agreement and not otherwise defined herein shall
have the meanings assigned thereto in the Agreement. Certain terms used in this
Warrant are specifically defined in Section 12 hereof.
2. EXERCISE OF WARRANT.
--------------------
2.1 IN GENERAL. This Warrant may be exercised in whole or in part by
the holder hereof at any time or from time to time prior to its expiration by
surrender of this Warrant, with the form of subscription at the end hereof duly
executed by such holder, to the Company at its principal office, accompanied by
payment, by certified or official bank check payable to the order of the
Company or by wire transfer to its account in the amount obtained by
multiplying the number of shares of Common Stock for which this Warrant is then
being exercised by the Exercise Price then in effect; PROVIDED, HOWEVER, that
the holder hereof shall have the right, at its election, in lieu of delivering
the Exercise Price in cash, to instruct the Company in the form of subscription
to retain, in payment of the Exercise Price, a number of shares of Common Stock
(the "Payment Shares") equal to the quotient of (i) the aggregate Exercise
Price of the shares as to which this Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct the
number of Payment Shares from the shares to be delivered to the holder hereof.
"Average Closing Price" means, as of any date, (x) if shares of Voting Common
Stock are listed on a national securities exchange, the average of the closing
sales prices therefor on the largest securities exchange on which such shares
are traded on the last ten (10) trading days before such date, (y) if such
shares are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last ten (10) trading days before such
date or (z) if such shares are not listed on either a national securities
exchange or the NASDAQ National Market System, the average of the sales prices
therefor on the last twenty (20) trading days before such date. In the event
the Warrant is not exercised in full, the Company, at its expense, will
forthwith issue and deliver to or upon the order of the holder hereof a new
Warrant or Warrants of like tenor, in the name of the holder hereof or as such
holder (upon payment by such holder of any applicable transfer taxes) may
request, calling in the aggregate on the face or faces thereof for the number
of shares of Common Stock equal (without giving effect to any adjustment
therein) to the number of such shares called for on the face of this Warrant
minus the number of such shares (without giving effect to any adjustment
therein) for which this Warrant shall have been exercised.
2.2 Intentionally Omitted.
2.3 CONFLICT WITH OTHER LAWS. Any other provisions hereof to the
contrary notwithstanding, no Bank Affiliate shall be entitled to exercise the
right under this Warrant to
<PAGE> 3
purchase any share or shares of Common Stock if, under any law or under any
regulation, rule or other requirement of any governmental authority at any time
applicable to such Bank Affiliate, (a) as a result of such purchase, such Bank
Affiliate would own, control or have power to vote a greater quantity of
securities of any kind than the Bank Affiliate shall be permitted to own,
control or have power to vote or (b) such purchase would not be permitted. For
purposes of this Section 2.3, a written certification of the Bank Affiliate
exercising the Warrant, delivered upon surrender of the Warrant pursuant to the
Agreement, to the effect that the Bank Affiliate is legally entitled to
exercise its right under this Warrant to purchase securities and that such
purchase will not violate the prohibitions set forth in the preceding sentence,
shall be conclusive and binding upon the Company and shall obligate the Company
to deliver certificates representing the shares of Common Stock so purchased in
accordance with the other provisions hereof and shall relieve the Company of
any liability under this Section 2.3.
2.4 TERMINATION OF THE WARRANT. This Warrant shall terminate upon the
earlier to occur of (i) August 29, 2003 and (ii) the exercise in full.
3. REGISTRATION RIGHTS.
--------------------
The holder of this Warrant has the right to cause the Company to
register shares of Warrant Stock, and any shares issued upon exercise hereof,
under the Securities Act and any blue sky or securities laws of any
jurisdictions within the United States at the time and in the manner specified
in the Registration Rights Agreement.
4. DELIVERY OF STOCK CERTIFICATES ON EXERCISE.
-------------------------------------------
As soon as practicable after the exercise of this Warrant in full or
in part, any in any event within twenty (20) days thereafter, the Company at
its expense (including the payment by or of any applicable issue taxes) will
cause to be issued in the name of and delivered to the holder hereof, or as
such holder (upon payment by such holder of any applicable transfer taxes) may
direct, a certificate or certificates for the number of fully paid and
non-assessable shares of Common Stock (or Other Securities) which such holder
shall be entitled to receive on such exercise, together with any other stock or
other securities and property (other than cash) which such holder is entitled
to receive upon exercise.
5. ADJUSTMENT FOR DIVIDEND, DISTRIBUTION AND RECLASSIFICATIONS.
------------------------------------------------------------
In case at any time or from time to time the holders of Common Stock
shall have received or (on or after the record date fixed for the determination
of shareholders eligible to receive) shall have become entitled to receive,
without payment therefor:
(a) other or additional stock or other certificates or property (other
than cash) by way of dividend; or
3
<PAGE> 4
(b) other or additional stock or other securities or property (other
than cash) by way of spin-off, split-up, reclassification, recapitalization,
combination of shares or similar corporate restructuring;
OTHER THAN additional shares of Common Stock issued in a stock split or other
reclassification, recapitalization or similar corporate restructuring of the
Company's Common Stock (adjustment in respect of which are provided for in
Section 7.1 hereof), then and in each such case the holder of this Warrant, on
the exercise hereof as provided in Section 2 hereof, shall be entitled to
receive the amount of stock and other securities and property (other than cash)
which such holder would have received prior to, or would have held on the date
of, such exercise if on the date hereof he had been the holder of record of the
number of shares of Common Stock called for on the face of this Warrant and had
thereafter, during the period from the date hereof to and including the date of
such exercise, retained such shares and all such other or additional stock and
other securities and property (other than cash) receivable by such holder as
aforesaid during such period, giving effect to all further adjustments called
for during such period by Sections 6 and 7 hereof. The Company hereby agrees
that it will at all times reserve and keep available for such holder, solely
for delivery upon the exercise of this Warrant, any distribution to which such
holder is entitled under this Section 5.
6. ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC.
----------------------------------------------------------
6.1 CERTAIN ADJUSTMENTS. In case at any time or from time to time, the
Company shall (i) effect a capital reorganization, reclassification or
recapitalization, (ii) consolidate with or merge into any other Person or (iii)
transfer all or substantially all of its properties or assets to any other
Person under any plan or arrangement contemplating the dissolution of the
Company, then in each such case, the holder of this Warrant, on the exercise
hereof as provided in Section 2 hereof at any time after the consummation of
such reorganization, reclassification, recapitalization, consolidation, merger
or transfer, or the effective date of such dissolution, as the case may be,
shall receive, in lieu of the Common Stock (or Other Securities) issuable on
such exercise prior to such consummation or effective date, the stock and other
securities and property (including cash) to which such holder would have been
entitled upon such consummation or in connection with such dissolution, as the
case may be, if such holder had so exercised this Warrant immediately prior
thereto, all subject to further adjustment thereafter as provided in Section 5
and 7 hereof.
6.2 CONTINUATION OF TERMS. Upon any reorganization, reclassification,
recapitalization, consolidation, merger or transfer referred to in this Section
6, this Warrant shall continue in full force and effect and the terms hereof
shall be applicable to the shares of stock and Other Securities and property
receivable on the exercise of this Warrant after the consummation of such
reorganization, reclassification, recapitalization, consolidation or merger, as
the case may be, and shall be binding upon the issuer of any such stock or
Other Securities, including, in the case of any such transfer, the Person
acquiring all or substantially all of the properties or assets of the Company,
whether or not such Person shall have expressly assumed the terms of this
Warrant as provided in Section 8 hereof.
4
<PAGE> 5
7. ADJUSTMENTS FOR ISSUANCE OF COMMON STOCK
AND AMOUNT OF OUTSTANDING COMMON STOCK.
---------------------------------------
7.1 IN GENERAL. If at any time there shall occur any stock split,
stock dividend, reverse stock split or other subdivision, reclassification,
recapitalization, recombination of shares or similar corporate restructuring of
the Company's Common Stock, any rights offering by the Company to its existing
stockholders or any issuance by the Company of Additional Shares of Common
Stock upon the exercise of Convertible Securities (each as defined in Section
7.2 hereof) granted before the consummation of the G&M Merger, other than any
such shares issued upon the exercise of options granted to Thomas A. Trantum
before August 30, 1991 (each, a "Stock Event"), then the number of shares of
Common Stock to be received by the holder of this Warrant shall be
appropriately adjusted such that the proportion of the number of shares
issuable hereunder to the total number of outstanding shares of the Company
(calculated on a Fully-Diluted Basis) prior to such Stock Event is equal to
the proportion of the number of outstanding shares of the Company after such
Stock Event (calculated on a Fully-Diluted Basis). No adjustment to the
Exercise Price shall be made in connection with any adjustment of the number of
shares of Common Stock receivable upon exercise of this Warrant, except that
the Exercise Price shall be proportionately increased or decreased upon the
occurrence of any event provided for in this Section 7.1 so that the aggregate
Exercise Price for all shares of Common Stock covered hereby shall remain
unchanged.
7.2 ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. If at any time the
Company shall issue or sell (i) any Additional Shares of Common Stock in
exchange for consideration in an amount per Additional Share of Common Stock
less than the Fair Market Value Per Share of Common Stock at the time the
Additional Shares of Common Stock are issued or sold or (ii) any Convertible
Securities having an exercise price or Conversion Price in an amount per share
of Common Stock less than the Fair Market Value Per Share of Common Stock at
the time of such issuance or sale, then the number of shares of Common Stock
for which this Warrant is exercisable shall be adjusted to equal the product
obtained by multiplying the number of shares of Common Stock for which this
Warrant is exercisable immediately prior to such issuance or sale by a fraction
(a) the numerator of which shall be the number of shares of Common Stock
outstanding immediately after such issuance or sale (assuming the conversion or
exercise of all such Convertible Securities) and (b) the denominator of which
shall be the number of shares of Common Stock outstanding immediately prior to
such issuance or sale plus either (x) the number of shares which the aggregate
offering price of the total number of such Additional Shares of Common Stock
would purchase at the then Fair Market Value Per Share or (y) the number of
shares of Common Stock which could be purchased if the exercise price of such
Convertible Security or the Conversion Price of such Convertible Security (as
applicable) were set at the then Fair Market Value Per Share. Thereupon, the
Exercise Price shall be correspondingly reduced so that the aggregate Exercise
Price for all shares of Common Stock covered hereby shall remain unchanged. No
adjustments shall be made upon the exercise or conversion of Convertible
Securities. For purposes of this paragraph, (i) the term "Additional Shares of
Common Stock" means any shares of Common Stock issued by the Company after the
Closing Date other than Warrant Stock or stock issuable upon the exercise of
options granted
5
<PAGE> 6
to Thomas A. Trantum, before August 30, 1991, (ii) the term "Convertible
Securities" means all options, warrants or securities exercisable for, all
rights to subscribe for, and all securities which are convertible into to
exchangeable for, Common Stock and (iii) the term "Conversion Price" means,
with respect to any Convertible Security, the price paid for such Convertible
Security divided by the number of shares of Common Stock into which such
Convertible Security is convertible on the date of issuance of such Convertible
Security.
8. NO DILUTION OR IMPAIRMENT.
--------------------------
The Company will not, by amendment of its Certificate of Incorporation
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid
or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder of this Warrant
hereunder. Without limiting the generality of the foregoing, the Company (i)
will not increase the par value of any shares of stock receivable on the
exercise of the Warrant above the amount payable therefor on such exercise,
(ii) will take all such action as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and non-assessable shares
of stock on the exercise of the Warrant from time to time outstanding, (iii)
will not issue any capital stock of any class which is preferred as to
dividends or as to the distribution of assets upon voluntary or involuntary
dissolution, liquidation or winding up, unless the rights of the holders
thereof shall be limited to a fixed sum or percentage of par value in respect
of participation in dividends and in any such distribution of assets and (iv)
will not transfer all or substantially all of its properties and assets to any
other entity (corporate or otherwise), or consolidate with or merge into any
other entity or permit any such entity to consolidate with or merge into the
Company (if the Company is not the surviving entity), unless such other entity
shall expressly assume in writing and will be bound by all the terms of this
Warrant and the Agreement. If any event occurs as to which the provisions of
Sections 5, 6 or 7 hereof are strictly applicable and the application thereof
would not, in the good faith judgment of the Board of Directors of the Company,
fairly protect the purchase rights of the Warrants in accordance with the
essential intent and principles of such provisions, then such Board shall make
such adjustments in the application of such provisions, in accordance with such
essential intent and principles, as shall be reasonably necessary, in the good
faith opinion of such Board, to protect such purchase rights as aforesaid, but
in no event shall any such adjustment have the effect of increasing the
Exercise Price or decreasing the number of shares of Common Stock subject to
purchase upon exercise of this Warrant. Nothing contained in this Warrant shall
prohibit the Company from issuing or selling securities in the future.
9. ACCOUNTANTS' CERTIFICATE AS TO ADJUSTMENTS.
-------------------------------------------
In each case of any event that may require any adjustment or
readjustment in the shares of Common Stock (or Other Securities) issuable on
the exercise of this Warrant, the Company at its expense will promptly prepare
a certificate setting forth such adjustment or readjustment and showing, in
detail, the facts upon which any such adjustment or readjustment
6
<PAGE> 7
is based, including a statement of (i) the number of shares of the Company's
Common Stock then outstanding on a Fully-Diluted Basis, and (ii) the number of
shares of Common Stock (or Other Securities) to be received upon exercise of
this Warrant (A) immediately prior to such adjustment or readjustment and (B)
as adjusted and readjusted (if required by Section 7) on account thereof. The
Company will forthwith mail a copy of each such certificate to each holder of a
Warrant and will, on the written request at any time of any holder of a
Warrant, furnish to such holder a like certificate setting forth the
calculations used to determine such adjustment or readjustment. At its option,
the holder of a Warrant may confirm the adjustment noted on the certificate by
causing such adjustment to be computed by an independent certified public
accountant at the expense of the Company. The cost of any such confirmation
shall be borne (x) by the Company, if the computation of such independent
certified public accountant indicates that the adjustment noted on the
Company's certificate was in any respect incorrect to the detriment of the
holders, and (y) otherwise, by the holder requesting such confirmation.
10. NOTICES OF RECORD DATE.
-----------------------
In the event of:
(a) any taking by the Company of a record of the holders of any
class of securities for the purpose of determining the holders thereof who are
entitled to receive any dividend or other distribution (including, without
limitation, any distribution that may arise as a result of a spin-off,
split-up, reclassification, recapitalization, combination of shares or similar
corporate restructuring), or any right to subscribe for, purchase or otherwise
acquire any shares of stock of any class or any other securities or property,
or to receive any other right;
(b) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company or any
transfer of all or substantially all the assets of the Company to or any
consolidation or merger of the Company with or into any other Person;
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company; or
(d) any proposed issuance or grant by the Company of any shares
of stock of any class or any other securities, or any right or option to
subscribe for, purchase or otherwise acquire any shares of stock of any class
or any other securities (other than the issuance of Common Stock on the
exercise of this Warrant),
then, and in each such event, the Company will mail or cause to be mailed to
the holder of this Warrant a notice specifying (i) the date on which any such
record is to be taken for the purpose of such dividend, distribution or right,
and stating the amount and character of such dividend, distribution or right,
(ii) the date on which any such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution, liquidation or
winding-up is to take place and the time, if any, to be fixed, as of which the
holders of record of Common Stock (or
7
<PAGE> 8
Other Securities) shall be entitled to exchange their shares of Common Stock
(or Other Securities) for securities or other property deliverable on such
reorganization, reclassification, recapitalization, transfer, consolidation,
merger, dissolution, liquidation or winding-up and (iii) the amount and
character of any stock or other securities, or rights or options with respect
thereto, proposed to be issued or granted, the date of such proposed issue or
grant and the persons or class of persons to whom such proposed issue or grant
is to be offered or made. Such notice shall be mailed at least twenty (20) days
prior to the date specified in such notice on which any such action is to be
taken.
11. RESERVATION OF STOCK ISSUABLE ON EXERCISE OF WARRANT.
-----------------------------------------------------
The Company will at all times reserve and keep available, solely
for issuance and delivery on the exercise of the Warrant, a number of shares of
Voting Common Stock equal to the total number of shares of Voting Common Stock
from time to time issuable upon exercise of this Warrant and the number of
Other Securities which at any time may be issuable hereunder, and, from time to
time, will take all steps necessary to amend its Certificate of Incorporation
to provide sufficient reserves of shares of Common Stock issuable upon exercise
of the Warrant and upon the conversion of shares of one class of Common Stock
into shares of the other class of Common Stock, as provided in its Certificate
of Incorporation.
12. DEFINED TERMS.
--------------
As used herein the following terms, unless the context otherwise
requires, have the following respective meanings:
12.1 The term BANK AFFILIATE means any Person that is a bank
holding company or a subsidiary of a bank holding company as defined in the
Bank Holding Company Act of 1956, as amended, or other applicable banking laws
of the United States and the rules and regulations promulgated thereunder.
12.2 The term COMPANY means Cryenco Sciences, Inc., the surviving
corporation of the merger of CHI into G&M, and any corporation which shall
succeed to or assume the obligations of the Company hereunder.
12.3 The term COMMON STOCK means (i) the Company's Voting Common
Stock, $.0l par value (the "Voting Common Stock"), (ii) the Company's
Convertible Non-Voting Common Stock, $.0l par value, (iii) any other capital
stock of any class or classes (however designated) of the Company the holders
of which shall have the right, without limitation as to amount, either to all
or to a share of the balance of current dividends and liquidating dividends
after the payment of dividends and distributions on any shares entitled to
preference and (iv) any other securities into which or for which any of the
securities described in clauses (i), (ii) or (iii) above have been converted,
exchanged or combined pursuant to a plan of recapitalization, reorganization,
merger, sale of assets or otherwise.
8
<PAGE> 9
12.4 The term OTHER SECURITIES means any stock (other than Common
Stock) and other securities of the Company or any other entity (corporate or
otherwise) which (i) the holder of this Warrant at any time shall be entitled to
receive, or shall have received, on the exercise of this Warrant, in lieu of or
in addition to Common Stock, or (ii) at any time shall be issuable or shall
have been issued in exchange for or in replacement of Common Stock or Other
Securities, in each case pursuant to Section 5 or 6 hereof.
13. REMEDIES.
---------
The Company stipulates that the remedies at law of the holder of
this Warrant in the event of any default or threatened default by the Company
in the performance of or compliance with any of the terms of this Warrant are
not and will not be adequate, and that such terms may be specifically enforced
by a decree for the specific performance of any agreement contained herein or
by an injunction against a violation of any of the terms hereof or otherwise.
14. NOTICES.
--------
All notices and other communications provided for or permitted
hereunder shall be made in writing (including facsimile transmission or other
similar writing) as follows: if to CIT, to it at 650 CIT Drive, Livingston,
New Jersey 07039-5795, Attention: Colby Collier (telecopier no.: (201)
740-5555), with a copy to Schulte Roth & Zabel, 900 Third Avenue, New York, New
York 10022, Attention: Marc Weingarten, Esq. (telecopier no.: (212) 593-5955);
if to a subsequent holder of this Warrant, to it at such address as may have
been furnished to the Company in writing by such holder or, until any such
holder furnishes to the Company an address, then to, and at the address of, the
last holder of this Warrant who has so furnished an address to the Company; and
if to the Company, to it c/o Charterhouse Group International, Inc. at 535
Madison Avenue, 28th Floor, New York, New York 10022, Attention: President
(telecopier no.: (212) 750-9704) with a copy to Shack & Siegel, P.C. 530 Fifth
Avenue, New York, New York 10036, Attention: Jeffrey N. Siegel, Esq.
(telecopier no.: (212) 730-1964); and thereafter at such other address, notice
of which is given in accordance with the provisions of this Section 14.
All such notices shall be deemed to have been duly given: (i) if
delivered personally, upon actual delivery, (ii) if delivered by mail, one
Business Day after deposited in the United States mail, overnight express mail,
return receipt requested, postage prepaid, or one Business Day after delivery
to a nationally recognized overnight express mall or courier service, or (iii)
if sent by facsimile transmission (or other similar writing), upon receipt of
telephonic or written confirmation thereof.
15. PUBLIC FILINGS, NASDAQ QUALIFICATIONS; AND MISCELLANEOUS.
---------------------------------------------------------
15.1 PUBLIC FILINGS AND NASDAQ QUALIFICATION. For so long as (i)
this Warrant is outstanding or (ii) the Shares of Warrant Stock issuable upon
the exercise of this Warrant are outstanding and have not been registered or
transferred in reliance upon Rule 144 or Rule 144A,
9
<PAGE> 10
in each case as amended from time to time under the Securities Act, or any
successor provisions relating to the resale of restricted securities without
registration under Section 5 of the Securities Act, the Company agrees to use
its best efforts (A) to file timely (whether or not it shall then be required
to do so) such information, documents and reports as the Commission may require
or prescribe under Section 13 or 15(d) (whichever is applicable) of the
Exchange Act, (B) promptly upon request, to furnish to any holder of this
Warrant or the Warrant Stock a copy of the most recent annual, current or
quarterly report of the Company and such other information which is provided to
all stockholders of the Company generally, (C) to file such other information,
documents and reports as shall be required of it hereafter by the Commission as
a condition to the availability of Rule 144 or 144A, in each case as may be
amended from time to time, under the Securities Act, or any successor (but not
additional) provisions relating to the resale of restricted securities without
registration under Section 5 of the Securities Act, and (D) to maintain the
quotation of its Common Stock on the National Association of Securities
Dealers, Inc. Automated Quotation System (bid and asked) including, without
limitation, using its best efforts to keep effective the registration to its
Common Stock under Section 12 of the Exchange Act and to make timely payment of
all applicable fees.
15.2 MISCELLANEOUS. In case any provision of this Warrant shall
be invalid, illegal or unenforceable, or partially invalid, illegal or
unenforceable, the provision shall be enforced to the extent, if any, that it
may legally be enforced and the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby. This
Warrant and any term hereof may be changed, waived, discharged or terminated
only by a statement in writing signed by the party against which enforcement of
such change, waiver, discharge or termination is sought. This Warrant shall be
governed by and construed in accordance with the domestic substantive laws (and
not the conflict of law rules) of the State of New York. The headings in this
Warrant are for purposes of reference only, and shall not limit or otherwise
affect any of the terms hereof.
10
<PAGE> 11
IN WITNESS WHEREOF, the Company has caused this Warrant to be
executed by its duly authorized officer and attested by its Secretary.
Dated as of November 24, 1993
CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
-----------------------
Name: Alfred Schechter
Title: Chairman
Attest:
/s/ James A. Raabe
- ------------------------
Name: James A. Raabe
Title: Secretary
11
<PAGE> 12
FORM OF SUBSCRIPTION
(To be signed only on exercise
of Common Stock Purchase Warrant)
To: Cryenco Sciences, Inc.
The undersigned, the Holder of the within Common Stock Purchase
Warrant, hereby irrevocably elects to exercise this Common Stock Purchase
Warrant for, and to purchase thereunder, ___shares of Voting Common Stock of
Cryenco Sciences, Inc. and herewith [makes payment of $_____ therefor]
[instructs you herein, in payment of the Exercise Price, to deduct ___ shares
of Voting Common Stock and to deliver the net number of shares, being ___
shares of Voting Common Stock], and requests that the certificates for such
shares be issued in the name of, and delivered to _________________ whose
address is __________
Dated:
_____________________________________
(Signature must conform in all
respects to name of Holder as
specified on the face of the Warrant)
______________________________________
(Address)
<PAGE> 13
FORM OF ASSIGNMENT
(To be signed only on transfer of Warrant)
For value received, the undersigned hereby sells, assigns, and
transfers unto _______ the right represented by the within Warrant to purchase
____ shares of ______ Common Stock of Cryenco Sciences, Inc., a Delaware
corporation, to which the within Warrant relates, and appoints ___________,
attorney to transfer such right on the books of Cryenco Sciences, Inc., with
full power of substitution in the premises.
[Name of Assignor]
Dated: _____________ By:_________________________________
Title: ___________________
Address: __________________
Signed in the presence of:
___________________________
<PAGE> 1
Exhibit 4.7
AMENDMENT TO WARRANT AGREEMENT
This Amendment to Warrant Agreement is made as of this 31st day of
July, 1997, by and between The CIT Group Equity Investments, Inc. (the
"Holder"), Cryenco Sciences, Inc., a Delaware corporation (f/k/a Cryenco
Holdings, Inc.) ("Cryenco") and Chart Industries, Inc., a Delaware corporation
("Chart").
WHEREAS, the Holder and Cryenco, among others, are parties to that
certain securities purchase agreement dated as of August 30, 1991, as amended,
and letter agreements dated as of August 12, 1992 and October 31, 1993 (the
"Warrant Agreement"), pursuant to which Cryenco granted the Holder a warrant or
warrants (the "Cryenco Warrants") to purchase 32,195 shares of Class B common
stock, par value $.01 per share (the "Class B Stock"), and 18,042 shares of
Class A common stock, par value $.0l per share (together with the Class B
Stock, the "Cryenco Common Stock") (such number of shares having been adjusted
to reflect the reverse stock split of Cryenco Common Stock effective August 13,
1992 and the antidilution adjustments triggered by Cryenco's Private Placement
and related transactions with International Capital Partners, Inc. which
occurred in December 1994, January 1995);
WHEREAS, Cryenco and Chart entered into a Plan and Agreement of Merger
dated as of April 30, 1997 (the "Merger Agreement") providing for the merger of
an affiliate of Chart into Cryenco (the "Merger") and the conversion of all
issued and outstanding Cryenco Common Stock (other than dissenters' shares)
into cash in the amount of $2.75 per share;
WHEREAS, in Section 5.4(b)(iii) of the Merger Agreement, Chart has
agreed to offer to grant substitute warrants (the "Chart Warrants") to purchase
shares of Chart's common stock, par value $.01 per share (the "Chart Common
Stock"), in exchange for the Cryenco Warrants; and
WHEREAS, the Holder, Cryenco and Chart now desire that, in
satisfaction of Chart's obligations under Section 5.4(b)(iii) of the Merger
Agreement, the Cryenco Warrants be amended to provide the Holder with the right
to purchase Chart Common Stock in substitution for the right to purchase
Cryenco Common Stock.
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements and undertakings set forth herein, the parties hereby agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall
have the meaning ascribed to them in the Merger Agreement.
<PAGE> 2
2. AMENDMENT. As of the effective time of the Merger (the "Effective
Time"), the Warrant Agreement and the Cryenco Warrants issued thereunder are
hereby amended as follows:
(a) CHANT COMMON STOCK SUBSTITUTED FOR CRYENCO COMMON STOCK. All
references to the right of the Holder to purchase shares of
Cryenco Common Stock shall be deemed to be and the right to
purchase shares of Chart Common Stock.
(b) ADJUSTMENT TO NUMBER OF SHARES UNDERLYING WARRANT. The number
of shares of Chart Common Stock issuable upon exercise of
each Chart Warrant which is issued in substitution for a
Cryenco Warrant shall be the product of (i) the number of
shares of Cryenco Common Stock that were issuable upon
exercise of the corresponding Cryenco Warrant immediately
prior to the Effective Time times (ii) a fraction (the
"Exchange Ratio") the numerator of which shall be $2.75 and
the denominator of which shall be the average of the closing
sales price of Chart Common Stock on the New York Stock
Exchange as reported by the Wall Street Journal for the ten
trading days immediately preceding the Effective Time;
provided, however, that in no event shall the Exchange Ratio
be less than .165 nor more than .206.
(c) ADJUSTMENT TO PURCHASE OR EXERCISE PRICE. The purchase or
exercise price per share of Chart Common Stock subject to a
Chart Warrant shall be equal to (i) the purchase or exercise
price per share of Cryenco Common Stock in the corresponding
Cryenco Warrant divided by (ii) the Exchange Ratio.
(d) NOTICES. Any notices, requests, forms, certificates or other
documents or communications deliverable to Cryenco under the
Warrant Agreement shall be required to be delivered instead
to Chart at 35555 Curtis Boulevard, Eastlake, OH 44095, to
the attention of the Chief Financial Officer, with a copy to
Calfee, Halter & Griswold LLP, 1400 McDonald Investment
Center, 800 Superior Avenue, Cleveland, OH 44114, Attention:
Thomas F. McKee.
(e) SUBSTITUTION OF WARRANTS. Chart and the Holder agree that any
and all Cryenco Warrants and/or Cryenco Warrant certificates
issued pursuant to the Warrant Agreement shall be amended in
a manner consistent with the provisions of this Amendment and
that, upon the Holder's presentation to Chart of such Cryenco
Warrants or Cryenco Warrant certificates, Chart shall deliver
to the Holder, in exchange and substitution therefor, new
Chart Warrants or Chart Warrant certificates.
-2-
<PAGE> 3
3. FULL COMPLIANCE; ASSUMPTION OF CRYENCO'S OBLIGATIONS; REFERENCES TO
CRYENCO. The Holder acknowledges and agrees that, as of the Effective Time,
Cryenco is in full compliance with all of its obligations under the Warrant
Agreement, the Cryenco Warrants and any related agreements pertaining to
registration rights of the Holder with respect to the shares of Cryenco Common
Stock issuable upon exercise of the Cryenco Warrants. As of the Effective Time,
Chart assumes all of the obligations of Cryenco under the Warrant Agreement as
amended hereby, and all references to Cryenco in the Warrant Agreement shall be
deemed to be references to Chart. To the extent that Holder is party to a
separate registration rights agreement relating to Cryenco Common Stock,
promptly after the Effective Time, Chart and the Holder shall enter into such
supplemental agreement as may be necessary to provide the Holder with
equivalent registration rights relating to Chart Common Stock issuable upon
exercise of the Chart Warrants.
4. RECEIPT OF CHART DISCLOSURES. The Holder acknowledges that it has
received copies of Chart's 1996 Form 10-K Report and Chart's Form 10-Q Report
for the three-month period ended March 31, 1997.
5. NO RIGHT TO PURCHASE CRYENCO COMMON STOCK. At and after the
Effective Time, the Holder shall be deemed to have surrendered any and all
rights under the Warrant Agreement and Warrant to purchase Cryenco Common
Stock.
6. CONSENT TO AMENDMENT. By the execution and delivery of this
Amendment, the Holder shall be deemed to have consented to the terms hereof in
accordance with the terms of the Warrant Agreement.
7. NO OTHER AMENDMENTS. Except as specifically provided herein or as
otherwise necessary or appropriate to effectuate the intent of this Amendment,
the provision of the Cryenco Warrant shall remain in full force and effect
without any alteration or modification thereto. Without limiting the
generality of the foregoing, the date of grant and the date of termination of
the Cryenco Warrant shall continue to be such dates as were in effect
immediately prior to the Effective Time.
8. SUCCESSORS AND ASSIGNS. This Amendment and all of the provisions
hereof shall be binding on and inure to the benefit of the parties
hereto and their respective successors and permitted assigns.
9. GOVERNING LAW. This Amendment shall be, and the Warrant Agreement
shall be amended to provide that it shall be, governed by and construed in
accordance with, the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
10. SEVERABILITY. If any one or more of the provisions contained
herein, or the application thereof in any circumstances, is held to be invalid,
illegal or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
-3-
<PAGE> 4
11. COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first written above.
CHART INDUSTRIES, INC.
Attest:
-------------------------- ----------------------------------
By:
Title:
THE CIT GROUP/EQUITY INVESTMENTS, INC.
Attest: /s/ Kenneth L. Walters, Jr.
-------------------------- ------------------------------------
By: Kenneth L. Walters, Jr.
Title: Vice President
CRYENCO SCIENCES, INC.
Attest: /s/ Steven M. Lutt /s/ James A. Raabe
-------------------------- -------------------------------------
By: James A. Raabe
Title: Vice President and Chief Financial
Officer
-4-
<PAGE> 1
Exhibit 4.8
WARRANT AGREEMENT
WARRANT AGREEMENT dated as of June 8, 1994 between CRYENCO SCIENCES,
INC., a Delaware corporation (the "Company"), and CRYOGENIC TADOPTR COMPANY,
L.P., a New York limited partnership (the "Holder").
1. GRANT. Subject to the terms of this Agreement, in consideration of
$10.00 and other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged by the Company, the Holder is hereby initially
granted the right to purchase, at any time and from time to time from and after
June 8, 1995 until 5:30 p.m., Denver time on June 7, 1999 (the "Exercise
Period"), up to an aggregate of 200,000 shares of Common Stock at an initial
exercise price of $3.00 per share. The Warrants are not exercisable prior to
June 8, 1995. The adjusted exercise price shall he the price which shall result
from time to time from any and all adjustments of the initial exercise price in
accordance with the provisions of SECTION 6 hereof. The term "Exercise Price"
herein shall mean the initial exercise price or the adjusted exercise price,
depending upon the context.
2. WARRANT CERTIFICATES. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall
be in the form set forth in Exhibit A, attached hereto and made a part hereof,
with such appropriate insertions, omissions, substitutions and other variations
as required or permitted by this Agreement.
3. EXERCISE OF WARRANTS. The Warrants initially are exercisable at the
Exercise Price (subject to adjustment as provided in SECTION 6 hereof) per
share of Common Stock, payable by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise
Price in cash, to instruct the Company in the form of subscription to retain,
in payment of the Exercise Price, a number of shares of Common Stock (the
"Payment Shares") equal to the quotient of (i) the Exercise Price multiplied by
the number of shares as to which the Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct the
number of Payment Shares from the shares to be delivered to the Holder.
"Average Closing Price" means, as of any date, (x) if shares of Common Stock
are listed on a national securities exchange, the average of the closing sales
prices therefor on the largest securities exchange on which such shares are
traded on the last 10 trading days before such date, (y) if such shares are
listed on the NASDAQ National Market System but not on any national securities
exchange, the average of the closing sales prices therefor on the NASDAQ
National Market System on the last 10 trading days before such date or (z) if
such shares are not listed on either a national securities exchange or the
NASDAQ National Market System, the average of the sales prices therefor on the
last 20 trading days before such date. Upon surrender of a Warrant Certificate
with the annexed Form of Election to Purchase duly executed, together with
payment of the Exercise Price for the shares of Common Stock at the Company's
principal offices (currently located at 3811 Joliet Street, Denver, Colorado
80239), the Holder or any subsequent registered holder or holders of a Warrant
Certificate (any such subsequent holder or holders also referred to herein as
the "Holder" or "Holders") shall he entitled to receive a
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certificate or certificates for the shares of Common Stock so purchased for the
Warrants so exercised. The purchase rights represented by each Warrant
Certificate are exercisable at the option of the Holder thereof, in whole or in
part (but not as to fractional shares of the Common Stock underlying the
Warrants). Warrants may he exercised to purchase all or part of the shares of
Common Stock represented thereby. In the case of the purchase of less than all
the securities purchasable under any Warrant Certificate, the Company shall
cancel said Warrant Certificate upon the surrender thereof and, unless the
Warrant has expired, shall execute and deliver a new Warrant Certificate of
like tenor for the balance of the securities purchasable thereunder. With
respect to any such exercise, the Holder shall for all purposes he deemed to
have become the holder of record of the number of shares of Common Stock from
the date on which the Warrant was surrendered and payment of the Exercise Price
was made irrespective of the date of delivery of such shares, except that, if
the date of such surrender and payment is a date on which the stock transfer
books of the Company are closed, such person shall he deemed to have become the
holder of such shares at the close of business on the next succeeding date on
which the stock transfer books are open.
4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the
issuance of certificates for the shares of Common Stock shall he made forthwith
(and in any event within 10 business days thereafter) without charge to the
Holder thereof including, without limitation, any tax which may he payable in
respect of the issuance thereof, and such certificates shall (subject to the
provisions of SECTIONS 5 and 7 hereof) be issued in the name of, or in such
names as may be directed by, the Holder thereof; provided, however, that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any such certificates in
a name other than that of the Holder and the Company shall not he required to
issue or deliver such certificates unless or until the person or persons
requesting the issuance thereof in a name other than that of the Holder 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.
The Warrant Certificates and the certificates representing the shares
of Common Stock shall he executed on behalf of the Company by the manual or
facsimile signature of the then present Chairman or Vice Chairman of the Board
of Directors or President or Vice President of the Company under its corporate
seal reproduced thereon, attested to by the dual or facsimile signature of the
then present Secretary or Assistant Secretary of the Company. Warrant
Certificates shall be dated the date of execution by the Company upon initial
issuance, division, exchange, substitution or transfer.
5. RESTRICTION ON TRANSFER OF WARRANTS.
There shall he not more than 25 Holders of record of the Warrants. The
Holder of a Warrant Certificate, by his or its acceptance thereof, covenants
and agrees that the Warrants may not he sold, transferred, assigned,
hypothecated or otherwise disposed of, in whole or in part, except in a
transaction exempt from registration under the Securities Act of 1933, as
amended (the "Act"). Prior to the transfer of any Warrants, the transferee
shall represent to the
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Company that it is acquiring the Warrants in its name for its own account with
no present intention of distributing the Warrants or any part thereof, but
without prejudice to its rights at all times to sell or otherwise dispose of
all or any part of the Warrants in a transaction exempt from the registration
requirements of the Act. It is understood that the Company is relying, and will
rely, to the extent applicable, upon such transferee's representation as
aforesaid. The Company shall not be required to issue a Warrant Certificate for
less than 5,000 shares of Common Stock, but may do so in the discretion of the
Company. Certificates representing the Warrants shall bear a legend setting
forth the foregoing restrictions.
6. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES.
6.1 COMPUTATION OF ADJUSTED EXERCISE PRICE. For the purposes of this
SECTION 6 the term Exercise Price shall mean the Exercise Price per share of
Common Stock set forth in SECTION 1 hereof as adjusted from time to time
pursuant to the provisions of this SECTION 6.
6.2 SUBDIVISION AND COMBINATIONS. In case the Company shall at any
time subdivide (for example, a stock split or stock dividend) or combine (for
example, a reverse stock split) the outstanding shares of Common Stock, the
Exercise Price shall forthwith he proportionately decreased in the case of
subdivision or increased in the case of combination.
6.3 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this SECTION 6 other than SECTION
6.6, the number of securities issuable upon the exercise of each Warrant shall
be adjusted to the nearest full share by multiplying a number equal to the
Exercise Price in effect immediately prior to such adjustment by the number of
shares of Common Stock (or other securities as provided in this SECTION 6)
issuable upon exercise of the Warrants immediately prior to such adjustment and
dividing the product so obtained by the adjusted Exercise Price.
6.4 DEFINITION OF COMMON STOCK. For the purpose of this Agreement, the
term "Common Stock" shall mean the class of stock designated as Class A Voting
Common Stock, $.0l par value, in the Restated Certificate of Incorporation of
the Company as of the date hereof, and any other securities into which or for
which any of the Class A Voting Common Stock have been converted, exchanged or
combined pursuant to a plan of recapitalization, reorganization, merger, sale
of assets or otherwise.
6.5 MERGER OR CONSOLIDATION. If any capital reorganization or
reclassification of the capital stock of the Company or any consolidation,
merger or other transaction of the Company with another corporation in which
the Company is the surviving corporation, or the sale of all or substantially
all of the Company's assets to another corporation shall be effected in such a
way that holders of Common Stock shall be entitled to receive consideration
(including but not limited to stock, securities or assets) with respect to or
in exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provisions
shall be made whereby each Holder shall thereafter have the right to
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receive upon the basis and upon the terms and conditions specified herein and
in lieu of the shares of Common Stock of the Company immediately theretofore so
receivable upon the exercise of each Warrant or Warrants, such shares of stock,
securities or assets (including cash) as may be issued or payable with respect
to or in exchange for a number of outstanding shares of such Common Stock equal
to the number of shares of such stock immediately theretofore so receivable had
such reorganization, reclassification, consolidation, merger or sale not taken
place, and in any such case appropriate provision shall be made with respect to
the rights and interests of such Holder to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise
Price) shall thereafter be applicable, as nearly as may be, in relation to any
shares of stock, securities or assets thereafter deliverable upon the exercise
of such rights. In the event of a merger or consolidation of the Company or
other transaction in which the Company is not the surviving corporation or in
which, as the result of the transaction, no trading market will exist for the
Common Stock, the Company shall give notice regarding the transaction in
accordance with SECTION 12 hereof as soon as practicable (and in no event less
than 20 days prior to the record date fixed for the transaction or, if none,
the closing date for such transaction) in order to afford the Holders the
opportunity to exercise their Warrants and receive after exercise the same
consideration payable in the transaction to other holders of Common Stock. This
SECTION 6.5 shall similarly apply to successive reorganizations,
classifications, consolidations, mergers or other transaction contemplated
hereby.
6.6 ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK.
If at any time the Company shall issue or sell (i) any Additional
Shares of Common Stock in exchange for consideration less than the lesser of
(a) the Fair Market Value Per Share of Common Stock at the time of such
issuance or sale, or (b) the Exercise Price, as applicable on the date of such
issuance or sale or (ii) any Convertible Security having an exercise price or
Conversion Price in an amount per share of Common Stock less than the lesser
of (a) the Fair Market Value Per Share of Common Stock at the time of such
issuance or sale or (b) the Exercise Price, as applicable on the date of such
issuance or sale, then the number of shares of Common Stock for which this
Warrant is exercisable shall be adjusted to equal the product obtained by
multiplying the number of shares of Common Stock for which this Warrant is
exercisable immediately prior to such issuance or sale by a fraction (a) the
numerator of which shall be the number of shares of Common Stock outstanding
immediately after such issuance or sale (assuming the conversion or exercise
of all such Convertible Securities) and (b) the denominator of which shall be
the number of shares of Common Stock outstanding immediately prior to such
issuance or sale plus either (x) the number of shares which the aggregate
offering price of the total number of such Additional Shares of Common Stock
would purchase at the then Fair Market Value Per Share or applicable Exercise
Price (whichever is less) or (y) the number of shares of Common Stock which
could be purchased if the exercise price of such Convertible Security or the
Conversion Price of such Convertible Security (as applicable) were set at the
then Fair Market Value Per Share or applicable Exercise Price (whichever is
less). Thereupon, the Exercise Price shall be correspondingly reduced so that
the aggregate Exercise Price for all shares of Common Stock covered hereby
shall remain unchanged. No adjustments shall be made upon the exercise or
conversion of Convertible Securities. For purposes of this
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paragraph, (i) the "Fair Market Value" shall be determined by multiplying (A)
the sum of (1) the number of shares of Common Stock then outstanding plus (2)
the number of shares of Common Stock then issuable upon exercise of any
outstanding Convertible Securities by (B) the Average Closing Price (as defined
below) per share of Common Stock as of the date of the issuance or sale of
such Additional Shares of Common Stock, (ii) the term "Average Closing Price"
shall mean, as of any date with respect to shares of Common Stock, (x) if such
shares are listed on a national securities exchange, the average of the
closing sales prices therefor on the largest securities exchange on which such
shares are traded on the last 10 trading days before such date, (y) if such
shares are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
last 10 trading days before such date or (z) if such shares are not listed on
either a national securities exchange or the NASDAQ National Market System,
the average of the sales prices therefor on the last 20 trading days before
such date, (iii) the term "Fair Market Value Per Share" shall mean as at any
date, the quotient obtained by dividing the Fair Market Value as at that date
by the number of issued and outstanding shares of Common Stock at such date,
calculated on a fully diluted basis, (iv) the term "Additional Shares of
Common Stock" means any shares of Common Stock issued by the Company after the
issuance of this Warrant except shares issuable upon exercise of any warrants
or options of the Company outstanding on the date hereof or shares issuable
upon exercise of options hereafter granted under any stock option plan of the
Company in existence on the date hereof, (v) the term "Convertible Securities"
means all options, warrants or securities exercisable for, all rights to
subscribe for, and all securities which are convertible into to or
exchangeable for, Common Stock and (vi) the term "Conversion Price" means,
with respect to any Convertible Security, the price paid for such Convertible
Security divided by the number of shares of Common Stock into which such
Convertible Security is convertible on the date of issuance of such
Convertible Security.
6.7 NOTICE OF ADJUSTMENT. Upon any adjustment of the Exercise Price,
the Company shall give written notice thereof to each Holder in accordance
with SECTION 12 hereof, which notice shall state the Exercise Price resulting
from such adjustment, setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based.
7. REGISTRATION RIGHTS.
7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. The Warrants and
the shares of Common Stock have not been registered for sale under the Act.
Upon exercise of the Warrants, in part or in whole, certificates representing
the shares of Common Stock shall bear the following legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended ("Act"), and
may not be offered or sold except pursuant to (i) an effective
registration statement under the Act, (ii) to the extent applicable,
Rule 144 under the Act (or any similar rule under such Act relating
to the disposition of securities), or (iii) an opinion of counsel, if
such
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opinion shall be reasonably satisfactory to counsel to the issuer
that an exemption from registration under such Act is available.
Upon the request of a holder of a certificate representing any such
shares of Common Stock, the Company shall remove the foregoing legend from the
certificate or issue to such holder a new certificate therefor free of any
transfer legend, if, with such request, the Company shall have received either
(i) an opinion of counsel reasonably satisfactory to the Company to the effect
that such legend may be removed from such certificate or (ii) if the present
Paragraph (k) of Rule 144 or a substantially identical successor rule remains
in force and effect, representations from the holder that such holder is not
then, and has not been during the preceding three months, an affiliate of the
Company and that such holder has beneficially owned the security (within the
meaning of Rule 144) for three years or more. Such shares may be subject to
additional restrictions on transfer imposed under applicable state and federal
securities law.
7.2 PIGGYBACK REGISTRATION.
(a) If, at any time commencing after June 8, 1995 through
and including June 7, 1999 the Company proposes to register any of
its securities under the Act (other than in connection with a
transaction contemplated by Rule 145(a) promulgated under the Act or
pursuant to Form S-8) it will give written notice by registered or
certified mail, at least thirty (30) days prior to the filing of each
such registration statement, to the Holders of the Warrants of its
intention to do so. If the Holders of the Warrants notify the Company
within fifteen (15) days after receipt of any such notice of its or
their desire to include Common Stock underlying the Warrants in such
proposed registration statement, the Company shall use reasonable
best efforts to register such Common Stock under such registration
statement, provided, the Company shall not be required to use such
reasonable best efforts if the Common Stock requested to be
registered could then be sold without registration pursuant to Rule
144 within not more than 90 days from the date of the Company's
receipt of the Holder's notice (based on the number of shares of
Common Stock outstanding on that date and the average weekly trading
volume for such Common Stock for the four weeks preceding such date,
if applicable).
(b) In the case of an underwritten offering, if the managing
underwriter of the offering determines and advises the Company in
writing that inclusion of the Common Stock of the Holders requested
to be included would interfere with the successful offering of shares
by the Company there shall be excluded from such offering, to the
extent that the managing underwriter deems necessary and to the
extent required by contractual commitments of the Company to its
other warrant holders existing on March 1, 1994, shares of Common
Stock owned by the Holders on a PRO RATA basis.
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7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In
connection with any registration under SECTION 7.2 hereof, the Company
covenants and agrees as follows:
(a) The Company shall pay all reasonable costs (excluding
transfer taxes, if any, and fees and expenses of Holder(s)' counsel
and any underwriting or selling commissions), fees and expenses in
connection with all registration statements filed pursuant to SECTION
7.2 hereof including, without limitation, the Company's legal and
accounting fees (including the costs and expenses of any special
audit or other procedures), printing expenses, blue sky fees and
expenses.
(b) The Company will take all necessary action which may be
required in qualifying or registering the Common Stock included in a
registration statement for offering and sale under the securities or
blue sky laws of such states as reasonably are requested by the
Holder(s) and in no event shall the Company be required to effect
such qualification or registration if such act would require the
Company to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction where it is not now
so qualified or required to file such a consent.
(c) Upon any registration becoming effective pursuant to
this SECTION 7, the Company shall use its best efforts to: (i) keep
such registration statement current for a period of 180 days; (ii)
prepare and file with the Securities and Exchange Commission (the
"Commission") such amendments and supplements to such registration
statement as may be necessary to comply with the provisions of the
Act and the Regulations of the Commission with respect to the
disposition of all securities covered by such registration statement;
(iii) cause all the Common Stock registered pursuant to such
registration statement to be listed on each exchange or automated
quotation system on which the Common Stock is then listed; (iv)
provide a transfer agent and registrar for all stock registered
pursuant to such registration statement and CUSIP number for all such
stock, in each case not later than the effective date of such
registration; and (v) otherwise use its best efforts to comply with
all applicable rules and regulations of the Commission.
(d) As expeditiously as possible furnish to each Holder of
Common Stock to be sold pursuant to a registration statement such
reasonable numbers of copies of the prospectus, including a
preliminary prospectus, in conformity with the requirements of the
Act, and such other documents as such Holder may reasonably request
in order to facilitate the public sale or other disposition of the
registrable Common Stock owned by such Holder. If the Company has
delivered preliminary or final prospectuses to a selling Holder and
after have done so the prospectus must be amended to comply with the
requirements of the Act, the Company shall promptly notify the
selling Holder and, by accepting this Warrant, the Holder agrees to
cease making offers of the Common Stock immediately upon
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such request and to return all prospectuses to the Company. The
Company shall promptly provide the selling Holder with revised
prospectuses and, following receipt of the revised prospectuses, the
selling Holder shall be free to resume making offers of the Common
Stock.
(e) The Company shall indemnify and hold harmless the
Holder(s) of the Common Stock to be sold pursuant to any registration
statement and each person, if any, who controls such Holders within
the meaning of Section 15 of the Act or Section 20(a) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
against and from all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which any of
them may become subject under the Act, the Exchange Act or otherwise,
arising from such registration statement, except such matters in
respect of which such Holders are required to indemnify the Company
under the next succeeding paragraph.
(f) The Holders of the Common Stock to be sold pursuant to a
registration statement, and its or their successors and assigns,
shall indemnify and hold harmless the Company, its officers and
directors and each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20(a) of the Exchange
Act, against and from all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which they
may become subject under the Act, the Exchange Act or otherwise,
arising from information furnished by or on behalf of such Holders or
its or their successors or assigns, for specific inclusion in such
registration statement.
(g) Any person entitled to indemnification under this
SECTION 7 will (i) give prompt written notice to the indemnifying
party of any claim with respect to which it seeks indemnification 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 will not be subject to any liability
for any settlement made by the indemnified party without its consent
(but such consent will not be unreasonably withheld). An indemnifying
party who is not entitled to, or elects not to, assume the defense of
a claim will 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.
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(h) Nothing contained in this Agreement shall be construed
as requiring the Holder to exercise his or its Warrants prior to the
initial filing of any registration statement or the effectiveness
thereof.
(i) The Company at its expense shall deliver promptly to
each Holder participating in the offering and requesting the
correspondence and memoranda described below copies of all documents
proposed to be filed with the Commission, all correspondence between
the Commission and the Company, its counsel or auditors, and all
memoranda relating to the registration statement and permit each such
Holder at its expense to do such investigation, upon reasonable
advance notice, with respect to information contained in or omitted
from the registration statement as it deems reasonably necessary to
comply with applicable securities laws or rules of the National
Association of Securities Dealers, Inc. Such investigation shall
include access to books, records and properties and opportunities to
discuss the business of the Company with its officers and independent
auditors, all to such reasonable extent and at such reasonable times
and as often as any such Holder shall reasonably request.
8. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of securities in such denominations as shall
be designated by the Holder thereof at the time of such surrender, subject to
the provisions of Section 5 hereof.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of any Warrant Certificate, and,
in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable
expenses incidental thereto, and upon surrender and cancellation of the
Warrant Certificate, if mutilated, the Company will make and deliver a new
Warrant Certificate of like tenor, in lieu thereof.
9. ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be
required to issue certificates representing fractions of shares of Common
Stock upon the exercise of the Warrants, nor shall it be required to issue
scrip or pay cash in lieu of fractional interests, it being the intent of the
parties that all fractional interests shall be eliminated by rounding any
fraction up to the nearest whole number of shares of Common Stock or other
securities, properties or rights.
10. RESERVATION AND LISTING. The Company shall at times have and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon the exercise of the Warrants, such number of shares of Common
Stock or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants, and payment of the respective exercise price
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therefor, all shares of Common Stock and other securities issuable upon such
exercise shall, at the time of delivery thereof, be duly and validly issued,
fully paid, nonassessable, not subject to the preemptive rights of any
stockholder and free from all taxes, liens and charges with respect to the
issue thereof. The Company will take all such action as may be necessary to
ensure that all such shares of Common Stock may be so issued without violation
of any applicable law or regulation, or of any requirements of any national
securities exchange upon which the Common Stock of the Company may be listed.
The Company will not take any action which results in any adjustment of the
Exercise Price if the total number of shares of Common Stock issued and
issuable after such action upon exercise of the Warrants would exceed the
total number of shares of Common Stock then authorized by the Company's
Restated Certificate of Incorporation. The Company has not granted and will
not grant any right of first refusal with respect to shares issuable upon
exercise of the Warrants, and there are no preemptive rights associated with
such shares.
11. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement
shall be construed as conferring upon the Holders the right to vote or to
consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having
any rights whatsoever as a stockholder of the Company. If, however, at any
time prior to the expiration of the Warrants and their exercise, any of the
following events shall occur:
(a) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive a
dividend or distribution payable otherwise than in cash, or a cash
dividend or distribution payable otherwise than out of current or
retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
(b) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or exchangeable for shares of capital
stock of the Company, or any option, right or warrant to subscribe
therefor; or
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale
of all or substantially all of its property, assets and business as
an entity shall be proposed
then, in any one or more of said events, the Company shall give written notice
of such event at least 15 days prior to the date fixed as a record date or the
date of closing the transfer books for the determination of the stockholder
entitled to such dividend, distribution, convertible or exchangeable
securities or subscription rights, or entitled to vote on such proposed
dissolution, liquidation, winding up or sale. Such notice shall specify such
record date or the date of closing the transfer books, as the case may be.
Failure to give such notice or any defect therein shall not affect the
validity of any action taken in connection with the declaration or payment of
any
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such dividend, or the issuance of any convertible or exchangeable securities
or subscription rights, options or warrants or any proposed dissolution,
liquidation, winding up or sale.
12. NOTICES.
All notices, requests, consents and other communications hereunder
shall be in writing and shall be deemed to have been duly made when delivered,
or mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in SECTION 3
hereof or to such other address as the Company may designate by
notice to the Holders.
13. SUPPLEMENTS AND AMENDMENTS. The Company and the Holder may from
time to time supplement or amend this Agreement without the approval of any
subsequent Holders of Warrant Certificates (other than the Holder) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with provisions herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which the Company
and the Holder deem shall not adversely affect the interests of the Holders of
Warrant Certificates.
14. SUCCESSORS. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit of the Company, the Holders,
the limited partners of the Holder and their respective successors and assigns
hereunder.
15. TERMINATION. This Agreement shall terminate at the close of
business on June 7, 1999. Notwithstanding the foregoing, the indemnification
provisions of SECTION 7 shall survive such termination until the close of
business on June 7, 2002.
16. GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement and
each Warrant Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of Delaware and for all purposes shall be
construed in accordance with the laws of said State without giving effect to
the rules of said State governing the conflicts of laws.
17. ENTIRE AGREEMENT; MODIFICATION. This Agreement contains the
entire understanding between the parties hereto with respect to the subject
matter hereof and may not be modified or amended except by a writing duly
signed by the party against whom enforcement of the modification or amendment
is sought.
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18. SEVERABILITY. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
19. CAPTIONS. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive
effect.
20. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Holder and any subsequent registered Holder(s) of the Warrant Certificates or
Warrants any legal or equitable right, remedy or claim under this Agreement;
and this Agreement shall be for the sole and exclusive benefit of the Company
and the Holder and subsequent Holder(s) of the Warrant Certificates or
Warrants.
21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and
the same instrument.
12
<PAGE> 13
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
-------------------------------
Name: Alfred Schechter
Title: President
Attest
/s/ Steven M. Lutt
- -------------------------
Name: Steven M. Lutt
Title: Assistant Secretary
CRYOGENIC TADOPTR
COMPANY, L.P.
By: Cryogenic TADOPTR Corp., as
general partner
By: /s/ Burton J. Ahrens
---------------------------
Name: Burton J. Ahrens
Title: President
13
<PAGE> 14
EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY
SATISFACTORY TO COUNSEL TO THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION
UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, ______________, 1999
No. W-1994___ _________ Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that ________________________, or
registered assigns, is the registered holder of ___________ Warrants to
purchase initially, at any time from ______________, 1995 until 5:30 p.m.,
Denver time, on _________________, 1999 ("Expiration Date"), up to ______
shares of Class A voting common stock, $.01 par value ("Common Stock") of
CRYENCO SCIENCES, INC., a Delaware corporation (the "Company"), at the price
per share of Common Stock equal to the Exercise Price set forth in the Warrant
Agreement dated as of ______________, 1994 between the Company and CRYOGENIC
TADOPTR COMPANY, L.P. (the "Warrant Agreement"), upon surrender of this
Warrant Certificate and payment of the Exercise Price at an office or agency
of the Company, but subject to the conditions set forth herein and in the
Warrant Agreement. Payment of the Exercise Price shall be made by certified or
official bank cashier's check payable to the order of the Company; PROVIDED,
HOWEVER, that the Holder shall have the right, at his or its election, in lieu
of delivering the Exercise Price in cash, to instruct the Company in the form
of subscription to retain, in payment of the Exercise Price, a number of
shares of Common Stock (the "Payment Shares") equal to the quotient of (i) the
Exercise Price multiplied by the number of shares as to which the Warrant is
then being exercised divided by (ii) the "Average Closing Price" as of the
date of exercise and to deduct the number of Payment Shares from the shares to
be delivered to the Holder. "Average Closing Price" means, as of any date, (x)
if shares of Common Stock are listed on a national securities exchange, the
average of the closing sales prices therefor on
14
<PAGE> 15
the largest securities exchange on which such shares are traded on the 10
trading days before such date, (y) if such shares are listed on the NASDAQ
National Market System but not on any national securities exchange, the
average of the closing sales prices therefor on the NASDAQ National Market
System on the last 10 trading days before such date or (z) if such shares are
not listed on either a national securities exchange or the NASDAQ National
Market System, the average of the sales prices therefor on the last 20 trading
days before such date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which
is hereby incorporated by reference in and made a part of this instrument and
is hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the Holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
PROVIDED, HOWEVER, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the Holder as set forth in the Warrant Agreement to purchase the
number of shares for the exercise price as so adjusted or any other rights set
forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate
or Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in the
Warrant Agreement, without any charge except for any tax or other governmental
charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the Holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
15
<PAGE> 16
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate
to be duly executed under its corporate seal.
Date as of __________________, 1994
CRYENCO SCIENCES, INC.
[SEAL]
By:_______________________
Name:
Title:
Attest:
_________________________
Name:
Title:
16
<PAGE> 17
FORM OF ELECTION TO PURCHASE
TO: Cryenco Sciences, Inc.
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
____________ shares of Class A voting Common Stock;
and herewith [tenders in payment for such securities a certified or
official bank cashier's check payable to the order of CRYENCO SCIENCES, INC.
in the amount of $______________ therefor] [instructs you herein, in payment
of the Exercise Price, to deduct __________ shares of Class A voting Common
Stock and to deliver the net number of shares, being _________ shares of Class
A voting Common Stock]. The undersigned requests that a certificate for such
securities be registered in the name of ________________________ whose address
is ___________________________________________ and that such Certificate be
delivered to __________________________________ whose address is
_________________________________.
Dated: Signature: ___________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Holder)
17
<PAGE> 18
FORM OF ASSIGNMENT
(To be exercised by the registered holder if such holder desires to
transfer the Warrant Certificate to the extent permitted by Section 5 of the
Warrant Agreement.)
FOR VALUE RECEIVED _______________________________________ hereby
sells, assigns and transfers unto
_________________________________________________
(Please print name and address of transferee)
this Warrant Certificate; together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint ______________________
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company, with full power of substitution.
Dated: Signature: ___________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Assignee)
18
<PAGE> 1
Exhibit 4.9
AMENDMENT NO.1 TO WARRANT AGREEMENT
This Amendment No. 1 to Warrant Agreement is made as of this 31st day
of July, 1997, by and between Cryogenic TADOPTR Company, L.P. (the "Holder"),
Cryenco Sciences, Inc., a Delaware corporation (f/k/a Cryenco Holdings, Inc.)
("Cryenco") and Chart Industries, Inc., a Delaware corporation ("Chart").
WHEREAS, the Holder and Cryenco are parties to a warrant agreement or
agreements (the "Warrant Agreement") dated as of June 8, 1994, pursuant to
which Cryenco granted the Holder a warrant or warrants (the "Cryenco Warrant")
to purchase an aggregate of 200,000 shares of Cryenco Class A common stock,
par value $.01 per share (the "Cryenco Common Stock");
WHEREAS, Cryenco and Chart entered into a Plan and Agreement of
Merger dated as of April 30, 1997 (the "Merger Agreement") providing for the
merger of an affiliate of Chart into Cryenco (the "Merger") and the conversion
of all issued and outstanding Cryenco Common Stock (other than dissenters'
shares) into cash in the amount of $2.75 per share;
WHEREAS, in Section 5.4(b)(iii) of the Merger Agreement, Chart has
agreed to offer to grant a substitute warrant (the "Chart Warrant") to
purchase shares of Chart's common stock, par value $.01 per share (the "Chart
Common Stock), in exchange for the Cryenco Warrant; and
WHEREAS, the Holder, Cryenco and Chart now desire that, in
satisfaction of Chart's obligations under Section 5.4(b)(iii) of the Merger
Agreement, the Cryenco Warrant be amended to provide the Holder with the right
to purchase Chart Common Stock in substitution for the right to purchase
Cryenco Common Stock;
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements and undertakings set forth herein, the parties hereby agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall
have the meaning ascribed to them in the Merger Agreement.
2. AMENDMENT. As of the effective time of the Merger (the "Effective
Time"), the Warrant Agreement and the form of Cryenco Warrant referenced
therein are hereby amended as follows:
(a) CHART COMMON STOCK SUBSTITUTED FOR CRYENCO COMMON STOCK. All
references to the right of the Holder to purchase shares of
Cryenco Common Stock shall be deleted and the right to
purchase shares of Chart Common Stock shall be substituted
therefor.
<PAGE> 2
(b) ADJUSTMENT TO NUMBER OF SHARES UNDERLYING WARRANT. The
number of shares of Chart Common Stock issuable upon
exercise of the warrant shall be the product of (i) the
number of shares of Cryenco Common Stock that were issuable
upon exercise of the Cryenco Warrant times (ii) a fraction
(the "Exchange Ratio") the numerator of which shall be $2.75
and the denominator of which shall be the average of the
closing sales price of Chart Common Stock on the New York
Stock Exchange as reported by the Wall Street Journal for
the ten trading days preceding the Effective Time; provided,
however, that in no event shall the Exchange Ratio be less
than .165 nor more than .206.
(c) ADJUSTMENT TO PURCHASE OR EXERCISE PRICE. The purchase or
exercise price per share of Chart Common Stock subject to
the Chart Warrant shall be equal to (i) the purchase or
exercise price per share of Cryenco Common Stock divided by
(ii) the Exchange Ratio.
(d) NOTICES. Any notices, requests, forms, certificates or other
documents or communications deliverable to Cryenco under the
Warrant Agreement shall be required to be delivered instead
to Chart at 35555 Curtis Boulevard, Eastlake, OH 44095, to
the attention of the Chief Financial Officer, with a copy to
Calfee, Halter & Griswold LLP, 1400 McDonald Investment
Center, 800 Superior Avenue, Cleveland, OH 44114, Attention:
Thomas F. McKee.
(e) SUBMISSION TO JURISDICTION. Any provision in the Warrant
Agreement requiring that any action, claim or proceeding
arising out of, or relating in any way to, the Warrant
Agreement be brought exclusively in a jurisdiction located
in the State of Colorado shall be deleted in its entirety.
(f) SUBSTITUTION OF WARRANTS. Chart and the Holder agree that
any and all Warrants and/or Warrant Certificates issued
pursuant to the Warrant Agreement shall be amended in a
manner consistent with the provisions of this Amendment No. 1
and that, upon the Holder's presentation to Chart of such
Warrants or Warrant Certificates, Chart shall deliver to the
Holder, in exchange and substitution therefor, new Warrant
or Warrant Certificates.
3. FULL COMPLIANCE; ASSUMPTION OF CRYENCO'S OBLIGATIONS: REFERENCES TO
CRYENCO. The Holder acknowledges and agrees that, as of the Effective Time,
Cryenco is in full compliance with all of its obligations under the Warrant
Agreement, the Cryenco Warrant and any related agreements pertaining to
registration rights of the Holder with respect to the shares of Cryenco Common
Stock issuable upon exercise of the Warrants. As of the Effective Time, Chart
assumes all of the obligations of Cryenco under the Warrant Agreement as
amended hereby, and all references to Cryenco in the Warrant Agreement shall
be deemed to be
-2-
<PAGE> 3
references to Chart. To the extent that Holder is party to a separate
registration rights agreement relating to Cryenco Common Stock, promptly after
the Effective Time, Chart and the Holder shall enter into such supplemental
agreement as may be necessary to provide the Holder with equivalent
registration rights relating to Chart Common Stock issuable upon exercise of
the Chart Warrant.
4. RECEIPT OF CHART DISCLOSURES. The Holder acknowledges that it has
received copies of Chart's 1996 Form 10-K Report and Chart's Form l0-Q Report
for the three-month period ended March 31, 1997.
5. NO RIGHT TO PURCHASE CRYENCO COMMON STOCK. At and after the Effective
Time, the Holder shall be deemed to have surrendered any and all rights under
the Warrant Agreement and Warrant to purchase Cryenco Common Stock.
6. CONSENT TO AMENDMENT. By the execution and delivery of this Amendment
No. 1, the Holder shall be deemed to have consented to the terms hereof in
accordance with the terms of the Warrant Agreement.
7. NO OTHER AMENDMENTS. Except as specifically provided herein or as
otherwise necessary or appropriate to effectuate the intent of this Amendment
No.1, the provisions of the Cryenco Warrant shall remain in full force and
effect without any alteration or modification thereto. Without limiting the
generality of the foregoing, the date of grant and the date of termination of
the Cryenco Warrant shall continue to be such dates as were in effect
immediately prior to the Effective Time.
8. SUCCESSORS AND ASSIGNS. This Agreement and all of the provisions
hereof shall be binding on and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
9. GOVERNING LAW. This Amendment No.1 shall be, and the Warrant
Agreement shall be amended to provide that it shall be, governed by and
construed in accordance with, the laws of the State of Delaware, without
giving effect to principles of conflicts of law.
10. SEVERABILITY. If any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held to be invalid,
illegal or unenforceable, the validity, legality and enforceability of any
such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
11. COUNTERPARTS. This Amendment No. 1 may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same instrument.
-3-
<PAGE> 4
IN WITNESS WHEREOF, the parties have executed this Amendment No.1 as of
the date first written above.
CHART INDUSTRIES, INC.
Attest: /s/ Suzanne Lines /s/ Don A. Baines
------------------------ ---------------------------------
By: Don A. Baines
Title: CFO & Treasurer
CRYOGENIC TADOPTR COMPANY, L.P.
By: Cryogenic TADOPTR Corp.,
as General Partner
Attest: /s/ Burton J. Ahrens
------------------------ ---------------------------------
By: Burton J. Ahrens
Title: President
CRYENCO SCIENCES, INC.
Attest: /s/ Steven M. Lutt /s/ James A. Raabe
------------------------ ---------------------------------
By: James A. Raabe
Title: VP & CFO
-4-
<PAGE> 1
Exhibit 4.10
WARRANT AGREEMENT
WARRANT AGREEMENT dated as of December 20, 1994 between CRYENCO
SCIENCES, INC., a Delaware corporation (the "Company"), and The Edgehill
Corporation (the "Holder") .
1. GRANT. Subject to the terms of this Agreement, in consideration of
$10.00 and other good and valuable consideration the receipt and sufficiency
of which is hereby acknowledged by the Company, the Holder is hereby initially
granted the right to purchase, at any time and from time to time from April
20, 1995 until 5:30 p.m., Denver time on December 20, 1999 (the "Exercise
Period"), up to an aggregate of 25,000 shares of Common Stock at an initial
exercise price of $4.00. The adjusted exercise price shall be the price which
shall result from time to time from any and all adjustments of the initial
exercise price, in accordance with the provisions of SECTION 6 hereof. The
term "Exercise Price" herein shall mean the initial exercise price, as
applicable based on the date of exercise, or the adjusted exercise price,
depending upon the context.
2. WARRANT CERTIFICATES. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall
be in the form set forth in Exhibit A, attached hereto and made a part hereof,
with such appropriate insertions, omissions, substitutions and other
variations as required or permitted by this Agreement.
3. EXERCISE OF WARRANTS. The Warrants initially are exercisable at the
Exercise Price (subject to adjustment as provided in Section 6 hereof) per
share of Common Stock, payable by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise
Price in cash, to instruct the Company in the form of subscription to retain,
in payment of the Exercise Price, a number of shares of Common Stock (the
"Payment Shares") equal to the quotient of (i) the Exercise Price multiplied
by the number of shares as to which the Warrant is then being exercised
divided by (ii) the "Average Closing Price" as of the date of exercise and to
deduct the number of Payment Shares from the shares to be delivered to the
Holder. "Average Closing Price" means, as of any date, (x) if shares of Common
Stock are listed on a national securities exchange, the average of the closing
sales prices therefor on the largest securities exchange on which such shares
are traded on the last 10 trading days before such date, (y) if such shares
are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last 10 trading days before such date or
(z) if such shares are not listed on either a national securities exchange or
the NASDAQ National Market System, the average of the sales prices therefor on
the last 20 trading days before such date. Upon surrender of a Warrant
Certificate with the annexed Form of Election to Purchase duly executed,
together with payment of the Exercise Price for the shares of Common Stock at
the Company's principal offices (currently located at 3811 Joliet Street,
Denver, Colorado 80239), the Holder or any
<PAGE> 2
subsequent registered holder or holders of a Warrant Certificate (any such
subsequent holder or holders also referred to herein as the "Holder" or
"Holders") shall be entitled to receive a certificate or certificates for the
shares of Common Stock so purchased for the Warrants so exercised. The
purchase rights represented by each Warrant Certificate are exercisable at the
option of the Holder thereof, in whole or in part (but not as to fractional
shares of the Common Stock underlying the Warrants). Warrants may be exercised
to purchase all or part of the shares of Common Stock represented thereby. In
the case of the purchase of less than all the securities purchasable under any
Warrant Certificate, the Company shall cancel said Warrant Certificate upon
the surrender thereof and, unless the Warrant has expired, shall execute and
deliver a new Warrant Certificate of like tenor for the balance of the
securities purchasable thereunder. With respect to any such exercise, the
Holder shall for all purposes be deemed to have become the holder of record of
the number of shares of Common Stock from the date on which the Warrant was
surrendered and payment of the Exercise Price was made irrespective of the
date of delivery of such shares, except that, if the date of such surrender
and payment is a date on which the stock transfer books of the Company are
closed, such person shall be deemed to have become the holder of such shares
at the close of business on the next succeeding date on which the stock
transfer books are open.
4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the
issuance of certificates for the shares of Common Stock shall be made
forthwith (and in any event within 10 business days thereafter) without charge
to the Holder thereof including, without limitation, any tax which may be
payable in respect of the issuance thereof, and such certificates shall
(subject to the provisions of SECTIONS 5 and 7 hereof) be issued in the name
of, or in such names as may be directed by, the Holder thereof; provided,
however, that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of
any such certificates in a name other than that of the Holder and the Company
shall not be required to issue or deliver such certificates unless or until
the person or persons requesting the issuance thereof in a name other than
that of the Holder 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.
The Warrant Certificates and the certificates representing the shares
of Common Stock shall be executed on behalf of the Company by the manual or
facsimile signature of the then present Chairman or Vice Chairman of the Board
of Directors or President or Vice President of the Company under its corporate
seal reproduced thereon, attested to by the dual or facsimile signature of the
then present Secretary or Assistant Secretary of the Company. Warrant
Certificates shall be dated the date of execution by the Company upon initial
issuance, division, exchange, substitution or transfer.
5. RESTRICTION ON TRANSFER OF WARRANTS.
There shall be not more than five (5) Holders of record of the
Warrants. The Holder of a Warrant Certificate, by his or its acceptance
thereof, covenants and agrees that the Warrants may not be sold, transferred,
assigned, hypothecated or otherwise disposed of, in
2
<PAGE> 3
whole or in part, except to or among wholly owned subsidiaries of the Holder
or officers, directors or employees of the Holder, who also shall hold the
warrants subject to the restrictions contained in this Section 5.
6. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES.
6.1 COMPUTATION OF ADJUSTED EXERCISE PRICE. For the purposes of this
SECTION 6 the term Exercise Price shall mean the Exercise Price per share of
Common Stock set forth in SECTION 1 hereof, as adjusted from time to time
pursuant to the provisions of this SECTION 6.
6.2 SUBDIVISION AND COMBINATIONS. In case the Company shall at any
time subdivide (for example, a stock split or stock dividend) or combine (for
example, a reverse stock split) the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
6.3 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this SECTION 6, the number of
securities issuable upon the exercise of each Warrant shall be adjusted to the
nearest full share by multiplying a number equal to the Exercise Price in
effect immediately prior to such adjustment by the number of shares of Common
Stock (or other securities as provided in this SECTION 6) issuable upon
exercise of the Warrants immediately prior to such adjustment and dividing the
product so obtained by the adjusted Exercise Price.
6.4 DEFINITION OF COMMON STOCK. For the purpose of this Agreement,
the term "Common Stock" shall mean (i) the class of stock designated as Class
A Voting Common Stock, $.01 par value, in the Restated Certificate of
Incorporation of the Company as of the date hereof, (ii) the class of stock
designated as Class B non-voting Convertible Common Stock, $.01 par value, in
the Restated Certificate of Incorporation, as amended, of the Company as of
the date hereof, (iii) any other capital stock of any class or classes
(however designated) of the Company the holders of which shall have the right,
without limitation as to amount, either to all or to a share of the balance of
current dividends and distributions on any shares entitled to preference
except the Series A Preferred Stock of the Company and (iv) any other
securities into which or for which any of the securities described in clauses
(i), (ii) or (iii) above have been converted, exchanged or combined pursuant
to a plan of recapitalization, reorganization, merger, sale of assets or
otherwise. In the event that the Company shall after the date hereof issue
securities with greater or superior voting rights than the shares of Common
Stock outstanding as of the date hereof, the Holder, at his or its option, may
receive upon exercise of any Warrant either shares of Common Stock or an equal
number of such securities with greater or superior voting rights.
6.5 MERGER OR CONSOLIDATION. If any capital reorganization or
reclassification of the capital stock of the Company or any consolidation,
merger or other transaction of the Company with another corporation in which
the Company is the surviving corporation, or the sale of all or substantially
all of the Company's assets to another corporation shall be effected
3
<PAGE> 4
in such a way that holders of Common Stock shall be entitled to receive
consideration (including but not limited to stock, securities or assets) with
respect to or in exchange for Common Stock, then, as a condition of such
reorganization, reclassification, consolidation, merger or sale, lawful and
adequate provisions shall be made whereby each Holder shall thereafter have the
right to receive upon the basis and upon the terms and conditions specified
herein and in lieu of the shares of Common Stock of the Company immediately
theretofore so receivable upon the exercise of each Warrant or Warrants, such
shares of stock, securities or assets (including cash) as may be issued or
payable with respect to or in exchange for a number of outstanding shares of
such Common Stock equal to the number of shares of such stock immediately
theretofore so receivable had such reorganization, reclassification,
consolidation, merger or sale not taken place, and in any such case appropriate
provision shall be made with respect to the rights and interests of such Holder
to the end that the provisions hereof (including, without limitation, provisions
for adjustments of the Exercise Price) shall thereafter be applicable, as nearly
as may be, in relation to any shares of stock, securities or assets thereafter
deliverable upon the exercise of such rights. In the event of a merger or
consolidation of the Company or other transaction in which the Company is not
the surviving corporation or in which, as the result of the transaction, no
trading market will exist for the Common Stock, the Company shall give notice
regarding the transaction in accordance with SECTION 12 hereof as soon as
practicable (and in no event less than 20 days prior to the record date fixed
for the transaction or, if none, the closing date for such transaction) in order
to afford the Holders the opportunity to exercise their Warrants and receive
after exercise the same consideration payable in the transaction to other
holders of Common Stock. This SECTION 6.5 shall similarly apply to successive
reorganizations, classifications, consolidations, mergers or other transaction
contemplated hereby.
6.6 NOTICE OF ADJUSTMENT. Upon any adjustment of the Exercise Price,
the Company shall give written notice thereof to each Holder in accordance with
SECTION 12 hereof, which notice shall state the Exercise Price resulting from
such adjustment, setting forth in reasonable detail the method of calculation
and the facts upon which such calculation is based.
7. REGISTRATION RIGHTS.
7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. The Warrants and
the shares of Common Stock have not been registered for sale under the Act.
Upon exercise of the Warrants, in part or in whole, certificates representing
the shares of Common Stock shall bear the following legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended ("Act"), and
may not be offered or sold except pursuant to (i) an effective
registration statement under the Act, (ii) to the extent applicable,
Rule 144 under the Act (or any similar rule under such Act relating to
the disposition of securities), or (iii) an opinion of counsel, if
such opinion shall be reasonably satisfactory to counsel to the issuer
that an exemption from registration under such Act is available.
4
<PAGE> 5
7.2 PIGGYBACK REGISTRATION.
(a) If, at any time commencing after March 20, 1995 through
and including the fifth anniversary hereof the Company proposes to
register any of its equity securities under the Act (other than in
connection with a transaction contemplated by Rule 145(a) promulgated
under the Act or pursuant to Form S-8 or S-4 or successor forms) it
will give written notice by registered or certified mail, at least 15
days prior to the filing of each such registration statement, to the
Holders of the Warrants of its intention to do so. If the Holders of
the Warrants notify the Company within 15 days after receipt of any
such notice of its or their desire to include Common Stock underlying
the Warrants in such proposed registration statement, the Company
shall afford such Holders of the opportunity to have any such Common
Stock registered under such registration statement.
(b) In the case of an underwritten offering, if the managing
underwriter of the offering determines and advises the Company in
writing that inclusion of the Common Stock of the Holders requested to
be included would interfere with the successful offering of shares by
the Company there shall be excluded from such offering, to the extent
that the managing underwriter deems necessary, shares of Common Stock
owned by the Holders on a PRO RATA basis and subject to any other
piggyback rights which may exist on the date hereof.
7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In
connection with any registration under SECTION 7.2 hereof, the Company
covenants and agrees as follows:
(a) The Company shall pay all reasonable costs (excluding
transfer taxes, if any, and fees and expenses of Holder(s)' counsel
and any underwriting or selling commissions), fees and expenses in
connection with all registration statements filed pursuant to SECTION
7.2 hereof including, without limitation, the Company's legal and
accounting fees (including the costs and expenses of any special audit
or other procedures), printing expenses, blue sky fees and expenses.
(b) The Company will take all necessary action which may be
required in qualifying or registering the Common Stock included in a
registration statement for offering and sale under the securities or
blue sky laws of such states as reasonably are requested by the
Holder(s) provided, however, that the number of states in which
qualification or registration shall be required shall not exceed five
(5) and in no event shall the Company be required to effect such
qualification or registration if such act would require the Company to
qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction where it is not now so
qualified or required to file such a consent.
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<PAGE> 6
(c) Upon any registration becoming effective pursuant to this
SECTION 7, the Company shall use its best efforts to: (i) keep such
registration statement current for a period of 90 days; (ii) prepare
and file with the Securities and Exchange Commission (the
"Commission") such amendments and supplements to such registration
statement as may be necessary to comply with the provisions of the Act
and the Regulations of the Commission with respect to the disposition
of all securities covered by such registration statement; (iii) cause
all the Common Stock registered pursuant to such registration
statement to be listed on each exchange or automated quotation system
on which the Common Stock is then listed; (iv) provide a transfer
agent and registrar for all stock registered pursuant to such
registration statement and CUSIP number for all such stock, in each
case not later than the effective date of such registration; and (v)
otherwise use its best efforts to comply with all applicable rules and
regulations of the Commission.
(d) The Company shall indemnify and hold harmless the
Holder(s) of the Common Stock to be sold pursuant to any registration
statement and each person, if any, who controls such Holders within the
meaning of Section 15 of the Act or Section 20(a) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), against and from
all loss, claim, damage, expense or liability (including all expenses
reasonably incurred in investigating, preparing or defending against
any claim whatsoever) to which any of them may become subject under the
Act, the Exchange Act or otherwise, arising from such registration
statement, except such matters in respect of which such Holders are
required to indemnify the Company under the next succeeding paragraph.
(e) The Holders of the Common Stock to be sold pursuant to a
registration statement, and its or their successors and assigns, shall
indemnify and hold harmless the Company, its officers and directors and
each person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, against and
from all loss, claim, damage, expense or liability (including all
expenses reasonably incurred in investigating, preparing or defending
against any claim whatsoever) to which they may become subject under
the Act, the Exchange Act or otherwise, arising from information
furnished by or on behalf of such Holders or its or their successors or
assigns, for specific inclusion in such registration statement.
(f) Any person entitled to indemnification under this SECTION
7 will (i) give prompt written notice to the indemnifying party of any
claim with respect to which it seeks indemnification 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 parry to assume the
defense of such claim with counsel reasonably satisfactory to the
indemnified party. If such defense is assumed, the indemnifying party
will not be subject to any liability for any settlement made by
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<PAGE> 7
the indemnified party without its consent (but such consent will not be
unreasonably withheld). An indemnifying parry who is not entitled to,
or elects not to, assume the defense of a claim will 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.
(g) Nothing contained in this Agreement shall be construed as
requiring the Holder to exercise his or its Warrants prior to the
initial filing of any registration statement or the effectiveness
thereof.
(h) The Company at its expense shall deliver promptly to each
Holder participating in the offering and requesting the correspondence
and memoranda described below copies of all documents proposed to be
filed with the Commission, all correspondence between the Commission
and the Company, its counsel or auditors, and all memoranda relating to
the registration statement and permit each such Holder at its expense
to do such investigation, upon reasonable advance notice, with respect
to information contained in or omitted from the registration statement
as it deems reasonably necessary to comply with applicable securities
laws or rules of the National Association of Securities Dealers, Inc.
Such investigation shall include access to books, records and
properties and opportunities to discuss the business of the Company
with its officers and independent auditors, all to such reasonable
extent and at such reasonable times and as often as any such Holder
shall reasonably request.
8. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of securities in such denominations as shall
be designated by the Holder thereof at the time of such surrender, subject to
the provisions of Section 5 hereof.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of any Warrant Certificate, and,
in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Warrant
Certificate, if mutilated, the Company will make and deliver a new Warrant
Certificate of like tenor, in lieu thereof.
9. ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
upon the exercise of the Warrants, nor shall it be required to issue scrip or
pay cash in lieu of fractional interests, it being the intent of the parties
that all fractional interests shall be eliminated by rounding any
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<PAGE> 8
fraction up to the nearest whole number of shares of Common Stock or other
securities, properties or rights.
10. RESERVATION AND LISTING. The Company shall at times have and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon the exercise of the Warrants, such number of shares of Common
Stock or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants, and payment of the respective exercise price therefor, all shares of
Common Stock and other securities issuable upon such exercise shall, at the time
of delivery thereof, be duly and validly issued, fully paid, nonassessable, not
subject to the preemptive rights of any stockholder and free from all taxes,
liens and charges with respect to the issue thereof. The Company will take all
such action as may be necessary to ensure that all such shares of Common Stock
may be so issued without violation of any applicable law or regulation, or of
any requirements of any national securities exchange upon which the Common Stock
of the Company may be listed. The Company will not take any action which results
in any adjustment of the Exercise Price if the total number of shares of Common
Stock issued and issuable after such action upon exercise of the Warrants would
exceed the total number of shares of Common Stock then authorized by the
Company's Restated Certificate of Incorporation. The Company has not granted and
will not grant any right of first refusal with respect to shares issuable upon
exercise of the Warrants, and there are no preemptive rights associated with
such shares. As long as the Warrants shall be outstanding, the Company shall use
its best efforts to cause all shares of Common Stock issuable upon exercise of
the Warrants to be listed (subject to official notice of issuance) on all
securities exchanges, if any, on which the Common Stock issued to the public in
connection herewith may then be listed and/or quoted on NASDAQ.
11. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement
shall be construed as conferring upon the Holders the right to vote or to
consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having any
rights whatsoever as a stockholder of the Company. If, however, at any time
prior to the expiration of the Warrants and their exercise, any of the following
events shall occur:
(a) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive a
dividend or distribution payable otherwise than in cash, or a cash
dividend or distribution payable otherwise than out of current or
retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
(b) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or exchangeable for shares of capital stock
of the Company, or any option, right or warrant to subscribe therefor;
or
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<PAGE> 9
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets and business as an
entity shall be proposed
then, in any one or more of said events, the Company shall give written notice
of such event at least 15 days prior to the date fixed as a record date or the
date of closing the transfer books for the determination of the stockholder
entitled to such dividend, distribution, convertible or exchangeable securities
or subscription rights, or entitled to vote on such proposed dissolution,
liquidation, winding up or sale. Such notice shall specify such record date or
the date of closing the transfer books, as the case may be. Failure to give such
notice or any defect therein shall not affect the validity of any action taken
in connection with the declaration or payment of any such dividend, or the
issuance of any convertible or exchangeable securities or subscription rights,
options or warrants or any proposed dissolution, liquidation, winding up or
sale.
12. NOTICES.
All notices, requests, consents and other communications hereunder
shall be in writing and shall be deemed to have been duly made when delivered,
or mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in SECTION 3
hereof or to such other address as the Company may designate by notice
to the Holders.
13. SUPPLEMENTS AND AMENDMENTS. The Company and the Holder may from
time to time supplement or amend this Agreement without the approval of any
subsequent Holders of Warrant Certificates (other than the Holder) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with provisions herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which the Company and
the Holder deem shall not adversely affect the interests of the Holders of
Warrant Certificates.
14. SUCCESSORS. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit of the Company, the Holders, the
limited partners of the Holder and their respective successors and assigns
hereunder.
15. TERMINATION. This Agreement shall terminate at the close of
business on December 20, 1999. Notwithstanding the foregoing, the
indemnification provisions of SECTION 7 shall survive such termination until the
close of business on December 20, 2002.
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<PAGE> 10
16. GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement and each
Warrant Certificate issued hereunder shall be deemed to be a contract made under
the laws of the State of Delaware and for all purposes shall be construed in
accordance with the laws of said State without giving effect to the rules of
said State governing the conflicts of laws.
The Company and the Holders hereby agree that any action, proceeding or
claim against it arising out of, or relating in any way to, this Agreement shall
be brought and enforced in the courts of the state of New York or of the United
States of America for the Southern District of New York, and irrevocably submits
to such jurisdiction, which jurisdiction shall be exclusive. The Company and the
Holders hereby irrevocably waive any objection to such exclusive jurisdiction or
inconvenient forum. Any such process or summons to be served upon any of the
Company and the Holders (at the option of the party bringing such action,
proceeding or claim) may be served by transmitting a copy thereof, by registered
or certified mail, return receipt requested, postage prepaid, addressed to it at
the address set forth in SECTION 12 hereof. Such mailing shall be deemed
personal service and shall be legal and binding upon the party so served in any
action, proceeding or claim.
17. ENTIRE AGREEMENT; MODIFICATION. This Agreement contains the entire
understanding between the parties hereto with respect to the subject matter
hereof and may not be modified or amended except by a writing duly signed by the
party against whom enforcement of the modification or amendment is sought.
18. SEVERABILITY. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
19. CAPTIONS. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive effect.
20. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Holder and any subsequent registered Holder(s) of the Warrant Certificates or
Warrants any legal or equitable right, remedy or claim under this Agreement; and
this Agreement shall be for the sole and exclusive benefit of the Company and
the Holder and subsequent Holder(s) of the Warrant Certificates or Warrants.
21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and the
same instrument.
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<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
CRYENCO SCIENCES. INC.
By: /s/ Alfred Schechter
---------------------------
Name: Alfred Schechter
Title: President
Attest:
/s/ Steven M. Lutt
- -----------------------
Name: Steven M. Lutt
Title: Assistant Secretary
THE EDGEHILL CORPORATION
By: /s/ Burton J. Ahrens
-----------------------------
Name: Burton J. Ahrens
Title: President
11
<PAGE> 12
EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER SUCH
ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF COUNSEL,
IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE ISSUER, THAT
AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, DECEMBER 20, 1999
No. W-DEC1994-1 25,000 Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that The Edgehill Corporation, or
registered assigns, is the registered holder of 25,000 Warrants to purchase
initially, at any time from April 20, 1995 until 5:30 p.m., Denver time, on
December 20, 1999 ("Expiration Date"), up to 25,000 shares of Class A voting
common stock, $.01 par value ("Common Stock") of CRYENCO SCIENCES, INC., a
Delaware corporation (the "Company"), at the price per share of Common Stock
equal to the Exercise Price set forth in the Warrant Agreement dated as of
December 20, 1994 between the Company and The Edgehill Corporation (the "Warrant
Agreement"), upon surrender of this Warrant Certificate and payment of the
Exercise Price at an office or agency of the Company, but subject to the
conditions set forth herein and in the Warrant Agreement. Payment of the
Exercise Price shall be made by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise Price
in cash, to instruct the Company in the form of subscription to retain, in
payment of the Exercise Price, a number of shares of Common Stock (the "Payment
Shares") equal to the quotient of (i) the Exercise Price multiplied by the
number of shares as to which the Warrant is then being exercised divided by (ii)
the "Average Closing Price" as of the date of exercise and to deduct the number
of Payment Shares from the shares to be delivered to the Holder. "Average
Closing Price" means, as of any date, (x) if
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<PAGE> 13
shares of Common Stock are listed on a national securities exchange, the average
of the closing sales prices therefor on the largest securities exchange on which
such shares are traded on the 10 trading days before such date, (y) if such
shares are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last 10 trading days before such date or
(z) if such shares are not listed on either a national securities exchange or
the NASDAQ National Market System, the average of the sales prices therefor on
the last 20 trading days before such date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the Holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; PROVIDED,
HOWEVER, that the failure of the Company to issue such new Warrant Certificates
shall not in any way change, alter, or otherwise impair, the rights of the
Holder as set forth in the Warrant Agreement to purchase the number of shares
for the exercise price as so adjusted or any other rights set forth in the
Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the
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<PAGE> 14
Holder(s) hereof, and for all other purposes, and the Company shall not be
affected by any notice to the contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Date as of December 20, 1994
CRYENCO SCIENCES, INC.
[SEAL]
By:___________________________
Name: Alfred Schechter
Title: President
Attest:
__________________________
Name: Steven M. Lutt
Title: Assistant Secretary
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<PAGE> 15
FORM OF ELECTION TO PURCHASE
TO: Cryenco Sciences, Inc.
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
____________ shares of Class A voting Common Stock;
and herewith [tenders in payment for such securities a certified or
official bank cashier's check payable to the order of CRYENCO SCIENCES, INC. in
the amount of $______________ therefor] [instructs you herein, in payment of the
Exercise Price, to deduct __________ shares of Class A voting Common Stock and
to deliver the net number of shares, being _________ shares of Class A voting
Common Stock]. The undersigned requests that a certificate for such securities
be registered in the name of _______________________ whose address is
_________________________________________ and that such Certificate be delivered
to _______________________________________ whose address is __________________.
Dated: Signature: _____________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other
Identifying Number of Holder)
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<PAGE> 16
FORM OF ASSIGNMENT
(To be exercised by the registered holder if such holder desires to
transfer the Warrant Certificate to the extent permitted by Section 5 of the
Warrant Agreement.)
FOR VALUE RECEIVED ____________________________ hereby sells, assigns
and transfers unto
____________________________________________________
(Please print name and address of transferee)
this Warrant Certificate; together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _______________________
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company, with full power of substitution.
Dated: Signature: ______________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Assignee)
16
<PAGE> 1
Exhibit 4.11
WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER SUCH
ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF COUNSEL,
IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE ISSUER, THAT
AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, DECEMBER 20, 1999
No. W-DEC1994-1 25,000 Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that The Edgehill Corporation, or
registered assigns, is the registered holder of 25,000 Warrants to purchase
initially, at any time from April 20, 1995 until 5:30 p.m., Denver time, on
December 20, 1999 ("Expiration Date"), up to 25,000 shares of Class A voting
common stock, $.01 par value ("Common Stock") of CRYENCO SCIENCES, INC., a
Delaware corporation (the "Company"), at the price per share of Common Stock
equal to the Exercise Price set forth in the Warrant Agreement dated as of
December 20, 1994 between the Company and The Edgehill Corporation (the "Warrant
Agreement"), upon surrender of this Warrant Certificate and payment of the
Exercise Price at an office or agency of the Company, but subject to the
conditions set forth herein and in the Warrant Agreement. Payment of the
Exercise Price shall be made by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise Price
in cash, to instruct the Company in the form of subscription to retain, in
payment of the Exercise Price, a number of shares of Common Stock (the "Payment
Shares") equal to the quotient of (i) the Exercise Price multiplied by the
number of shares as to which the Warrant is then being exercised divided by (ii)
the "Average Closing Price" as of the date of exercise and to deduct the number
of Payment Shares from the shares to be delivered to the Holder. "Average
Closing Price" means, as of any date, (x) if shares of Common Stock are listed
on a national securities exchange, the average of the closing sales prices
therefor on the largest securities exchange on which such shares are traded on
the
1
<PAGE> 2
10 trading days before such date, (y) if such shares are listed on the NASDAQ
National Market System but not on any national securities exchange, the average
of the closing sales prices therefor on the NASDAQ National Market System on the
last 10 trading days before such date or (z) if such shares are not listed on
either a national securities exchange or the NASDAQ National Market System, the
average of the sales prices therefor on the last 20 trading days before such
date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the Holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; PROVIDED,
HOWEVER, that the failure of the Company to issue such new Warrant Certificates
shall not in any way change, alter, or otherwise impair, the rights of the
Holder as set forth in the Warrant Agreement to purchase the number of shares
for the exercise price as so adjusted or any other rights set forth in the
Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the Holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
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<PAGE> 3
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Date as of December 20, 1994
CRYENCO SCIENCES, INC
[SEAL]
By: /s/ Alfred Schechter
----------------------------
Name: Alfred Schechter
Title: President
Attest:
/s/ Steven M. Lutt
- ---------------------------
Name: Steven M. Lutt
Title: Assistant Secretary
3
<PAGE> 1
Exhibit 4.12
AMENDMENT NO.1 TO WARRANT AGREEMENT
This Amendment No.1 to Warrant Agreement is made as of this 31st day of
July, 1997, by and between The Edgehill Corporation (the "Holder"), Cryenco
Sciences, Inc., a Delaware corporation (f/k/a Cryenco Holdings, Inc.)
("Cryenco") and Chart Industries, Inc., a Delaware corporation ("Chart").
WHEREAS, the Holder and Cryenco are parties to a warrant agreement or
agreements (the "Warrant Agreement") dated as of December 20, 1994, pursuant to
which Cryenco granted the Holder a warrant or warrants (the "Cryenco Warrant")
to purchase an aggregate of 25,000 shares of Cryenco Class A common stock, par
value $.01 per share (the "Cryenco Common Stock");
WHEREAS, Cryenco and Chart entered into a Plan and Agreement of Merger
dated as of April 30, 1997 (the "Merger Agreement") providing for the merger of
an affiliate of Chart into Cryenco (the "Merger") and the conversion of all
issued and outstanding Cryenco Common Stock (other than dissenters' shares) into
cash in the amount of $2.75 per share;
WHEREAS, in Section 5.4(b)(iii) of the Merger Agreement, Chart has
agreed to offer to grant a substitute warrant (the "Chart Warrant") to purchase
shares of Chart's common stock, par value $.01 per share (the "Chart Common
Stock"), in exchange for the Cryenco Warrant; and
WHEREAS, the Holder, Cryenco and Chart now desire that, in satisfaction
of Chart's obligations under Section 5.4(b)(iii) of the Merger Agreement, the
Cryenco Warrant be amended to provide the Holder with the right to purchase
Chart Common Stock in substitution for the right to purchase Cryenco Common
Stock;
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements and undertakings set forth herein, the parties hereby agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall
have the meaning ascribed to them in the Merger Agreement.
2. AMENDMENT. As of the effective time of the Merger (the "Effective
Time"), the Warrant Agreement and the form of Cryenco Warrant referenced
therein are hereby amended as follows:
(a) CHART COMMON STOCK SUBSTITUTED FOR CRYENCO COMMON STOCK. All
references to the right of the Holder to purchase shares of
Cryenco Common Stock shall be deleted and the right to
purchase shares of Chart Common Stock shall be substituted
therefor.
<PAGE> 2
(b) ADJUSTMENT TO NUMBER OF SHARES UNDERLYING WARRANT. The
number of shares of Chart Common Stock issuable upon
exercise of the warrant shall be the product of (i) the
number of shares of Cryenco Common Stock that were issuable
upon exercise of the Cryenco Warrant times (ii) a fraction
(the "Exchange Ratio") the numerator of which shall be $2.75
and the denominator of which shall be the average of the
closing sales price of Chart Common Stock on the New York
Stock Exchange as reported by the Wall Street Journal for
the ten trading days preceding the Effective Time; provided,
however, that in no event shall the Exchange Ratio be less
than .165 nor more than .206.
(c) ADJUSTMENT TO PURCHASE OR EXERCISE PRICE. The purchase or
exercise price per share of Chart Common Stock subject to
the Chart Warrant shall be equal to (i) the purchase or
exercise price per share of Cryenco Common Stock divided by
(ii) the Exchange Ratio.
(d) NOTICES. Any notices, requests, forms, certificates or other
documents or communications deliverable to Cryenco under the
Warrant Agreement shall be required to be delivered instead
to Chart at 35555 Curtis Boulevard, Eastlake, OH 44095, to
the attention of the Chief Financial Officer, with a copy to
Calfee, Halter & Griswold LLP, 1400 McDonald Investment
Center, 800 Superior Avenue, Cleveland, OH 44114, Attention:
Thomas F. McKee.
(e) SUBMISSION TO JURISDICTION. Any provision in the Warrant
Agreement requiring that any action, claim or proceeding
arising out of, or relating in any way to, the Warrant
Agreement be brought exclusively in a jurisdiction located
in the State of Colorado shall be deleted in its entirety.
(f) SUBSTITUTION OF WARRANTS. Chart and the Holder agree that
any and all Warrants and/or Warrant Certificates issued
pursuant to the Warrant Agreement shall be amended in a
manner consistent with the provisions of this Amendment No.
1 and that, upon the Holder's presentation to Chart of such
Warrants or Warrant Certificates, Chart shall deliver to the
Holder, in exchange and substitution therefor, new Warrant
or Warrant Certificates.
3. FULL COMPLIANCE; ASSUMPTION OF CRYENCO'S OBLIGATIONS; REFERENCES TO
CRYENCO. The Holder acknowledges and agrees that, as of the Effective Time,
Cryenco is in full compliance with all of its obligations under the Warrant
Agreement, the Cryenco Warrant and any related agreements pertaining to
registration rights of the Holder with respect to the shares of Cryenco Common
Stock issuable upon exercise of the Warrants. As of the Effective Time, Chart
assumes all of the obligations of Cryenco under the Warrant Agreement as
amended hereby, and all references to Cryenco in the Warrant Agreement shall
be deemed to be
<PAGE> 3
references to Chart. To the extent that Holder is party to a separate
registration rights agreement relating to Cryenco Common Stock, promptly after
the Effective Time, Chart and the Holder shall enter into such supplemental
agreement as may be necessary to provide the Holder with equivalent
registration rights relating to Chart Common Stock issuable upon exercise of
the Chart Warrant.
4. RECEIPT OF CHART DISCLOSURES. The Holder acknowledges that it has
received copies of Chart's 1996 Form 10-K Report and Chart's Form 10-Q Report
for the three-month period ended March 31, 1997.
5. NO RIGHT TO PURCHASE CRYENCO COMMON STOCK. At and after the Effective
Time, the Holder shall be deemed to have surrendered any and all rights under
the Warrant Agreement and Warrant to purchase Cryenco Common Stock.
6. CONSENT TO AMENDMENT. By the execution and delivery of this Amendment
No. 1, the Holder shall be deemed to have consented to the terms hereof in
accordance with the terms of the Warrant Agreement.
7. NO OTHER AMENDMENTS. Except as specifically provided herein or as
otherwise necessary or appropriate to effectuate the intent of this Amendment
No.1, the provisions of the Cryenco Warrant shall remain in full force and
effect without any alteration or modification thereto. Without limiting the
generality of the foregoing, the date of grant and the date of termination of
the Cryenco Warrant shall continue to be such dates as were in effect
immediately prior to the Effective Time.
8. SUCCESSORS AND ASSIGNS. This Agreement and all of the provisions
hereof shall be binding on and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
9. GOVERNING LAW. This Amendment No.1 shall be, and the Warrant
Agreement shall be amended to provide that it shall be, governed by and
construed in accordance with, the laws of the State of Delaware, without
giving effect to principles of conflicts of law.
10. SEVERABILITY. If any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held to be invalid,
illegal or unenforceable, the validity, legality and enforceability of any
such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
11. COUNTERPARTS. This Amendment No. 1 may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same instrument.
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<PAGE> 4
IN WITNESS WHEREOF, the parties have executed this Amendment No.1 as of
the date first written above.
CHART INDUSTRIES, INC.
Attest: /s/ Suzanne Lines /s/ Don A. Baines
----------------------------- ---------------------------------
By: Don A. Baines
Title: CFO & Treasurer
THE EDGEHILL CORPORATION
Attest: /s/ Burton J. Ahrens
----------------------------- ---------------------------------
By: Burton J. Ahrens
Title: President
CRYENCO SCIENCES, INC.
Attest: /s/ Steven M. Lutt /s/ James A. Raabe
----------------------------- ---------------------------------
By: James A. Raabe
Title: VP & CFO
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<PAGE> 1
Exhibit 4.13
WARRANT AGREEMENT dated as of March 12, 1993 between CRYENCO SCIENCES,
INC., a Delaware corporation (the "Company"), and DON M. HARWELL (the
"Holder").
1. GRANT. Subject to the terms of this Agreement, in consideration of
$10 and other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged by the Company, the Holder is hereby initially
granted the right to purchase, at any time and from time to time from March
12, 1993 until 5:30 p.m., Denver time, on March 11, 1998 (the "Exercise
Period"), up to an aggregate of 50,000 shares of Common Stock at an initial
exercise price of $7.90. The adjusted exercise price shall be the price which
shall result from time to time from any and all adjustments of the initial
exercise price in accordance with the provisions of SECTION 6 hereof. The term
"Exercise Price" herein shall mean the initial exercise price or the adjusted
exercise price, depending upon the context.
2. WARRANT CERTIFICATES. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall
be in the form set forth in Exhibit A, attached hereto and made a part hereof,
with such appropriate insertions, omissions, substitutions and other
variations as required or permitted by this Agreement.
3. EXERCISE OF WARRANTS. The Warrants initially are exercisable at
the Exercise Price (subject to adjustment as provided in SECTION 6 hereof) per
share of Common Stock, payable by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise
Price in cash, to instruct the Company in the form of subscription to retain,
in payment of the Exercise Price, a number of shares of Common Stock (the
"Payment Shares") equal to the quotient of (i) the Exercise Price multiplied
by the number of shares as to which the Warrant is then being exercised
divided by (ii) the "Average Closing Price" as of the date of exercise and to
deduct the number of Payment Shares from the shares to be delivered to the
Holder. "Average Closing Price" means, as of any date, (x) if shares of Common
Stock are listed on a national securities exchange, the average of the closing
sales prices therefor on the largest securities exchange on which such shares
are traded on the last ten (10) trading days before such date, (y) if such
shares are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last ten (10) trading days before the
date of exercise of the Warrants or (z) if such shares are not listed on
either a national securities exchange or the NASDAQ National Market System,
the average of the sales prices therefor on the last twenty (20) trading days
before the date of exercise of the Warrants. Upon surrender of a Warrant
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<PAGE> 2
Certificate with the annexed Form of Election to Purchase duly executed,
together with payment of the Exercise Price for the shares of Common Stock at
the Company's principal offices (currently located at 5995 North Washington
Street, Denver, Colorado 80216), the Holder or any subsequent registered
holder or holders of a Warrant Certificate (any such subsequent holder or
holders also reference to herein as the "Holder" or "Holders") shall be
entitled to receive a certificate or certificates for the shares of Common
Stock so purchased for the Warrants so exercised. The purchase rights
represented by each Warrant Certificate are exercisable at the option of the
Holder thereof, in whole or in part (but not as to fractional shares of the
Common Stock underlying the Warrants). Warrants may be exercised to purchase
all or part of the shares of Common Stock represented thereby. In the case of
the purchase of less than all the securities purchasable under any Warrant
Certificate, the Company shall cancel said Warrant Certificate upon the
surrender thereof and, unless the Warrant has expired, shall execute and
deliver a new Warrant Certificate of like tenor for the balance of the
securities purchasable thereunder. With respect to any such exercise, the
Holder shall for all purposes be deemed to have become the holder of record of
the number of shares of Common Stock evidenced by such certificate or
certificates from the date on which the Warrant was surrendered and payment of
the Exercise Price was made irrespective of the date of delivery of such
certificate, except that, if the date of such surrender and payment is a date
on which the stock transfer books of the Company are closed, such person shall
be deemed to have become the holder of such shares at the close of business on
the next succeeding date on which the stock transfer books are open.
4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the
issuance of certificates for the shares of Common Stock shall be made
forthwith (and in any event within ten (10) business days thereafter) without
charge to the Holder thereof including, without limitation, any tax which may
be payable in respect of the issuance thereof, and such certificates shall
(subject to the provisions of SECTIONS 5 and 7 hereof) be issued in the name
of, or in such names as may be directed by, the Holder thereof; provided,
however, that the Company shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of
any such certificates in a name other than that of the Holder, and the Company
shall not be required to issue or deliver such certificates unless or until
the person or persons requesting the issuance thereof in a name other than
that of the Holder 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.
The Warrant Certificates and the certificates representing the shares
of Common Stock shall be executed on
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<PAGE> 3
behalf of the Company by the manual or facsimile signature of the then present
Chairman or Vice Chairman of the Board of Directors or President or Vice
President of the Company under its corporate seal reproduced thereon, attested
to by the dual or facsimile signature of the then present Secretary or
Assistant Secretary of the Company. Warrant Certificates shall be dated the
date of execution by the Company upon initial issuance, division, exchange,
substitution or transfer.
5. RESTRICTION ON TRANSFER OF WARRANTS. There shall be not more than
five (5) Holders of record of Warrants. The Holder of a Warrant Certificate,
by his acceptance thereof, covenants and agrees that the Warrants may not be
sold, transferred, assigned, hypothecated or otherwise disposed of, in whole
or in part, except to or among the Holder, his spouse and the Holder's
children, any trust for the benefit of any such persons and any family
foundations, who also shall hold the Warrants subject to the restrictions
contained in this SECTION 5. Certificates representing the Warrants shall bear
a legend setting forth the foregoing restriction.
6. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES.
6.1 COMPUTATION OF ADJUSTED EXERCISE PRICE. For the purposes of this
SECTION 6, the term Exercise Price shall mean the Exercise Price per share of
Common Stock set forth in SECTION 1 hereof, as adjusted from time to time
pursuant to the provisions of this SECTION 6.
6.2 EXERCISE PRICE ADJUSTMENTS. In case at the time of any advance
under the Funding Agreement dated as of March 12, 1993 (the "Funding
Agreement") , the average closing price of the Common Stock in the NASDAQ
National Market System on the ten (10) trading days immediately preceding such
advance is less than the Exercise Price, the Exercise Price shall be reduced
and be equal to such average closing price of the Common Stock on the ten (10)
trading days immediately preceding such subsequent advance.
6.3 SUBDIVISION AND COMBINATIONS. In case the Company shall at any
time subdivide (for example, a stock split or stock dividend) or combine (for
example, a reverse stock split) the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
6.4 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this Section 6, the number of
securities issuable upon the exercise of each Warrant shall be adjusted to the
nearest full amount by multiplying a number equal to the Exercise Price in
effect immediately prior to such adjustment by the number of
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<PAGE> 4
shares of Common Stock (or other securities as provided in Section 5 hereof)
issuable upon exercise of the Warrants immediately prior to such adjustment
and dividing the product so obtained by the adjusted Exercise Price.
6.5 DEFINITION OF COMMON STOCK. For the purpose of this Agreement,
the term "Common Stock" shall mean (i) the class of stock designated as Class
A voting Common Stock, $.01 par value, in the Amended and Restated Certificate
of Incorporation of the Company as of the date hereof, (ii) the class of stock
designated as Class B non-voting Convertible Common Stock, $.01 par value, in
the Amended and Restated Certificate of Incorporation of the Company as of the
date hereof, (iii) any other capital stock of any class or classes (however
designated) of the Company the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of current
dividends and liquidating dividends after the payment of dividends and
distributions on any shares entitled to preference and (iv) any other
securities into which or for which any of the securities described in clauses
(i), (ii) or (iii) above have been converted, exchanged or combined pursuant
to a plan of recapitalization, reorganization, merger, sale of assets or
otherwise. In the event that the Company shall after the date hereof issue
securities with greater or superior voting rights than the shares of Common
Stock outstanding as of the date hereof, the Holder, at his or its option, may
receive upon exercise of any Warrant either shares of Common Stock or an equal
number of such securities with greater or superior voting rights.
6.6 MERGER OR CONSOLIDATION. If any capital reorganization or
reclassification of the capital stock of the Company or any consolidation,
merger or other transaction of the Company with another corporation in which
the Company is the surviving corporation, or the sale of all or substantially
all of the Company's assets to another corporation shall be effected in such a
way that holders of Common Stock shall be entitled to receive consideration
(including but not limited to stock, securities or assets) with respect to or
in exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate
provisions shall be made whereby each Holder shall thereafter have the right
to receive upon the basis and upon the terms and conditions specified herein
and in lieu of the shares of Common Stock of the Company immediately
theretofore so receivable upon the exercise of each Warrant or Warrants, such
shares of stock, securities or assets (including cash) as may be issued or
payable with respect to or in exchange for a number of outstanding shares of
such Common Stock equal to the number of shares of such stock immediately
theretofore so receivable had such reorganization, reclassification,
consolidation, merger or sale not taken place, and in any such case
appropriate provision shall be made with respect to the rights and interests
of such
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<PAGE> 5
holder to the end that the provisions hereof (including, without limitation,
provisions for adjustments of the Exercise Price) shall thereafter be
applicable, as nearly as may be, in relation to any shares of stock,
securities or assets thereafter deliverable upon the exercise of such exercise
rights. In the event of a merger or consolidation of the Company or other
transaction in which the Company is not the surviving corporation or in which,
as the result of the transaction, no trading market will exist for the Common
Stock, the Company shall give notice regarding the transaction in accordance
with SECTION 12 as soon as practicable (and in no event less than twenty (20)
days prior to the record date fixed for the transaction or, if none, the
closing date for such transaction) in order to afford the Holders the
opportunity to exercise their Warrants and receive after exercise the same
consideration as is payable in the transaction to other holders of Common
Stock. This SECTION 6.6 shall similarly apply to successive reorganizations,
classifications, consolidations, mergers or other transactions contemplated
hereby.
6.7 NOTICE OF ADJUSTMENT. Upon any adjustment of the Exercise Price,
the Company shall give written notice thereof to each Holder in accordance
with Section 12, which notice shall state the Exercise Price resulting from
such adjustment, setting forth in reasonable detail the method of calculation
and the facts upon which such calculation is based.
7. REGISTRATION RIGHTS.
7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. The Warrants and
the shares of Common Stock have not been registered for sale under the Act.
Upon exercise of the Warrants, in part or in whole, certificates representing
the shares of Common Stock shall bear the following legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended ("Act"), and
may not be offered or sold except pursuant to (i) an effective
registration statement under the Act, (ii) to the extent applicable,
Rule 144 under the Act (or any similar rule under such Act relating
to the disposition of securities), or (iii) an opinion of counsel, if
such opinion shall be reasonably satisfactory to counsel to the
issuer that an exemption from registration under such Act is
available.
7.2 PIGGYBACK REGISTRATION. (a) If, at any time commencing after the
date hereof through and including the fifth anniversary hereof the Company
proposes to register any of its securities under the Act (other than in
connection with a transaction contemplated by Rule 145(a) promulgated under
the Act or pursuant to Form S-8) it will give written notice by
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<PAGE> 6
registered or certified mail, at least fifteen (15) days prior to the filing
of each such registration statement, to the Holders of the Warrants of its
intention to do so. If the Holders of the Warrants notify the Company within
fifteen (15) days after receipt of any such notice of its or their desire to
include Common Stock underlying the Warrants in such proposed registration
statement, the Company shall afford the such Holders of the opportunity to
have any such Common Stock registered under such registration statement.
(b) In the case of an underwritten offering, if the managing
underwriter of the offering determines and advises the Company in writing that
inclusion of the Common Stock of the Holders requested to be included would
interfere with the successful offering of shares by the Company there shall be
excluded from such offering, to the extent that the managing underwriter deems
necessary, shares of Common Stock owned by the Holders on a pro rata basis.
7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In
connection with any registration under SECTION 7.2 hereof, the Company
covenants and agrees as follows:
(a) The Company shall pay all costs (excluding transfer taxes, if
any, and fees and expenses of Holder(s)' counsel and any underwriting or
selling commissions), fees and expenses in connection with all registration
statements filed pursuant to SECTION 7.2 hereof including, without limitation,
the Company's legal and accounting fees (including the costs and expenses of
any special audit or other procedures), printing expenses, blue sky fees and
expenses.
(b) The Company will take all necessary action which may be required
in qualifying or registering the Common Stock included in a registration
statement for offering and sale under the securities or blue sky laws of such
states as reasonably are requested by the Holder(s) provided, however, that
the number of states in which qualification or registration shall be required
shall not exceed five (5) and in no event shall the Company be required to
effect such qualification or registration if such act would require the
Company to qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction where it is not now so qualified or
required to file such a consent.
(c) Upon any registration becoming effective pursuant to this SECTION
7, the Company shall use its best efforts to: (i) keep such registration
statement current for a period of ninety (90) days; (ii) prepare and file with
the Commission such amendments and supplements to such registration statement
as may be necessary to comply with the provisions of the Act and the
Regulations of the Commission with respect to the disposition of all
securities covered by such registration
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<PAGE> 7
statement; (iii) cause all the Common Stock registered pursuant to such
registration statement to be listed on each exchange or automated quotation
system on which the Common Stock is then listed; (iv) provide a transfer agent
and registrar for all stock registered pursuant to such registration statement
and CUSIP number for all such stock, in each case not later than the effective
date of such registration; and (v) otherwise use its best efforts to comply
with all applicable rules and regulations of the Commission.
(d) The Company shall indemnify and hold harmless the Holder(s) of
the Common Stock to be sold pursuant to any registration statement and each
person, if any, who controls such Holders within the meaning of Section 15 of
the Act or Section 20(a) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") , against and from all loss, claim, damage, expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim what soever) to which any of them may
become subject under the Act, the Exchange Act or otherwise, arising from such
registration statement.
(e) The Holders of the Common Stock to be sold pursuant to a
registration statement, and its or their successors and assigns, shall
indemnify and hold harmless the Company, its officers and directors and each
person, if any, who controls the Company within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act, against and from all loss,
claim, damage, expense or liability (including all expenses reasonably
incurred in investigating, preparing or defending against any claim
whatsoever) to which they may become subject under the Act, the Exchange Act
or otherwise, arising from information furnished by or on behalf of such
Holders or its or their successors or assigns, for specific inclusion in such
registration statement.
(f) Any person entitled to indemnification under this SECTION 7 will
(i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification 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 will not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent will not
be unreasonably withheld). An indemnifying party who is not entitled to, or
elects not to, assume the defense of a claim will 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
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<PAGE> 8
interest may exist between such indemnified party and any other of such
indemnified parties with respect to such claim.
(g) Nothing contained in this Agreement shall be construed as
requiring the Holder to exercise his or its Warrants prior to the initial
filing of any registration statement or the effectiveness thereof.
(h) The Company at its expense shall deliver promptly to each Holder
participating in the offering and requesting the correspondence and memoranda
described below copies of all documents proposed to be filed with the
Commission, all correspondence between the Commission and the Company, its
counsel or auditors, and all memoranda relating to discussions with the
Commission or its staff with respect to the registration statement and permit
each such Holder at its expense to do such investigation, upon reasonable
advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary to comply with
applicable securities laws or rules of the National Association of Securities
Dealers, Inc. ("NASD"). Such investigation shall include access to books,
records and properties and opportunities to discuss the business of the
Company with its officers and independent auditors, all to such reasonable
extent and at such reasonable times and as often as any such Holder shall
reasonably request.
8. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of securities in such denominations as shall
be designated by the Holder thereof at the time of such surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of any Warrant Certificate, and,
in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable
expenses incidental thereto, and upon surrender and cancellation of the
Warrant Certificate, if mutilated, the Company will make and deliver a new
Warrant Certificate of like tenor, in lieu thereof.
9. ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be
required to issue certificates representing fractions of shares of Common
Stock upon the exercise of the Warrants, nor shall it be required to issue
scrip or pay cash in lieu of fractional interests, it being the intent of the
parties that all fractional interests shall be eliminated by rounding any
fraction up to the nearest whole number of shares of Common Stock or other
securities, properties or rights.
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<PAGE> 9
10. RESERVATION AND LISTING. The Company shall at times have and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon the exercise of the Warrants, such number of shares of Common
Stock or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants, and payment of the respective exercise price therefor, all shares of
Common Stock and other securities issuable upon such exercise shall, at the
time of delivery thereof, be duly and validly issued, fully paid,
nonassessable, not subject to the preemptive rights of any stockholder and
free from all taxes, liens and charges with respect to the issue thereof. The
Company will take all such action as may be necessary to ensure that all such
shares of Common Stock may be so issued without violation of any applicable
law or regulation, or of any requirements of any national securities exchange
upon which the Common Stock of the Company may be listed. The Company will not
take any action which results in any adjustment of the Exercise Price if the
total number of shares of Common Stock issued and issuable after such action
upon exercise of the Warrants would exceed the total number of shares of
Common Stock then authorized by the Company's Amended and Restated Certificate
of Incorporation. The Company has not granted and will not grant any right of
first refusal with respect to shares issuable upon exercise of the Warrants,
and there are no preemptive rights associated with such shares. As long as the
Warrants shall be outstanding, the Company shall use its best efforts to cause
all shares of Common Stock issuable upon the exercise of the Warrants to be
listed (subject to official notice of issuance) on all securities exchanges,
if any, on which the Common Stock issued to the public in connection herewith
may then be listed and/or quoted on NASDAQ.
11. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement
shall be construed as conferring upon the Holders the right to vote or to
consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having
any rights whatsoever as a stockholder of the Company. If, however, at any
time prior to the expiration of the Warrants and their exercise, any of the
following events shall occur:
(a) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive a
dividend or distribution payable otherwise than in cash, or a cash
dividend or distribution payable otherwise than out of current or
retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
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<PAGE> 10
(b) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or exchangeable for shares of capital
stock of the Company, or any option, right or warrant to subscribe
therefor; or
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale
of all or substantially all of its property, assets and business as
an entity shall be proposed
then, in any one or more of said events, the Company shall give written notice
of such event at least fifteen (15) days prior to the date fixed as a record
date or the date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution, convertible or
exchangeable securities or subscription rights, or entitled to vote on such
proposed dissolution, liquidation, winding up or sale. Such notice shall
specify such record date or the date of closing the transfer books, as the
case may be. Failure to give such notice or any defect therein shall not
affect the validity of any action taken in connection with the declaration or
payment of any such dividend, or the issuance of any convertible or
exchangeable securities, or subscription rights, options or warrants, or any
proposed dissolution, liquidation, winding up or sale.
12. NOTICES.
All notices, requests, consents and other communications hereunder
shall be in writing and shall be deemed to have been duly made when delivered,
or mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in SECTION 3
hereof or to such other address as the Company may designate by
notice to the Holders.
13. SUPPLEMENTS AND AMENDMENTS. The Company and the Holder may from
time to time supplement or amend this Agreement without the approval of any
subsequent Holders of Warrant Certificates (other than the Holder) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with provisions herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which the Company
and the Holder
-11-
<PAGE> 11
deem shall not adversely affect the interests of the Holders of Warrant
Certificates.
14. SUCCESSORS. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit the Company, the Holders and
their respective successors assigns hereunder.
15. This Agreement shall terminate at the close of business on March
11, 1998. Notwithstanding the foregoing, the indemnification provisions of
SECTION 7 shall survive such termination until the close of business on March
11, 2001.
16. GOVERNING LAW: SUBMISSION TO JURISDICTION. This Agreement and
each Warrant Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of Delaware and for all purposes shall be
construed in accordance with the laws of said State without giving effect to
the rules of said State governing the conflicts of laws.
The Company, the representative and the Holders hereby agree that any
action, proceeding or claim against it arising out of, or relating in any way
to, this Agreement shall be brought and enforced in the courts of the state of
New York or of the United States of America for the Southern District of New
York, and irrevocably submits to such jurisdiction, which jurisdiction shall
be exclusive. The Company, the Representative and the Holders hereby
irrevocably waive any objection to such exclusive jurisdiction or inconvenient
forum. Any such process or summons to be served upon any of the Company, the
representative and the Holders (at the option of the party bringing such
action, proceeding or claim) may be served by transmitting a copy thereof, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in SECTION 12 hereof. Such mailing
shall be deemed personal service and shall be legal and binding upon the party
so served in any action, proceeding or claim.
17. ENTIRE AGREEMENT: MODIFICATION. This Agreement (including the
Funding Agreement to the extent portions thereof are referred to herein)
contain the entire understanding between the parties hereto with respect to
the subject matter hereof and may not be modified or amended except by a
writing duly signed by the party against whom enforcement of the modification
or amendment is sought.
18. SEVERABILITY. If any provision of this amendment shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
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<PAGE> 12
19. CAPTIONS. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive
effect.
20. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to five to any person or corporation other than the Company and
the Holder and any subsequent registered Holder(s) of the Warrant Certificates
or Warrants any legal or equitable right, remedy or claim under this
Agreement; and this Agreement shall be for the sole and exclusive benefit of
the Company and the Holder and subsequent Holder(s) of the Warrant
Certificates or Warrants.
21. COUNTERPARTS. This Agreement may be executed any in number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and
the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
---------------------------
Name: Alfred Schechter
Title: President
Attest:
/s/ Alison A. Murray
- -----------------------
Name: Alison A. Murray
Title: Secretary
/s/ Don M. Harwell
---------------------------
Don M. Harwell
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<PAGE> 13
EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, March __ 1998
No. W-1993______ _______ Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that _________________ , or
registered assigns, is the registered holder of ______ Warrants to purchase
initially, at any time from March , 1993 until 5:30 p.m. Denver time on March
__ 1998 ("Expiration Date"), up to ______ shares of Class A voting common
stock, $.01 par value ("Common Stock") of CRYENCO SCIENCES, INC., a Delaware
corporation (the "Company"), at the price per share of Common Stock equal to
the Exercise Price set forth in the Warrant Agreement dated as of March ___,
1993 between the Company and ____________ (the "Warrant Agreement"), upon
surrender of this Warrant Certificate and payment of the Exercise Price at an
office or agency of the Company, but subject to the conditions set forth
herein and in the Warrant Agreement. Payment of the Exercise Price shall be
made by certified or official bank cashier's check payable to the order of the
Company; PROVIDED, HOWEVER, that the holder hereof shall have the right, at
his or its election, in lieu of delivering the Exercise Price in cash, to
instruct the Company in the form of subscription to retain, in payment of the
Exercise Price, a number of shares of Common Stock (the "Payment Shares")
equal to the quotient of (i) the Exercise Price multiplied by the number of
shares as to which this Warrant is then being exercised divided by (ii) the
"Average Closing Price" as of the date of exercise and to deduct the number of
Payment Shares from the shares to be delivered to
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<PAGE> 14
the holder hereof. "Average Closing Price" means, as of any date, (x) if
shares of Common Stock are listed on a national securities exchange, the
average of the closing sales prices therefor on the largest securities
exchange on which such shares are traded on the last ten (10) trading days
before such date, (y) if such shares are listed on the NASDAQ National Market
System but not on any national securities exchange, the average of the closing
sales prices therefor on the NASDAQ National Market System on the last ten
(10) trading days before the date of the exercise of the Warrants or (z) if
such shares are not listed on either a national securities exchange or the
NASDAQ National Market System, the average of the sales prices therefor on the
last twenty (20) trading days before the date of the exercise of the Warrants.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, hereby shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which
is hereby incorporated by reference in and made a part of this instrument and
is hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders" or "holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
provided, however, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the holder as set forth in the Warrant Agreement to purchase the
number of shares for the exercise price as so adjusted or any other rights set
forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate
or Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in the
Warrant Agreement, without any charge except for any tax or other governmental
charge imposed in connection with such transfer.
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<PAGE> 15
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate
to be duly executed under its corporate seal.
Dated as of March ____, 1993 CRYENCO SCIENCES, INC.
[SEAL] By:_________________________
Name:
Title:
Attest:
___________________________
Name:
Title:
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<PAGE> 16
FORM OF ELECTION TO PURCHASE
TO: Cryenco Sciences, Inc.
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
__________ shares of Class A voting Common Stock;
and herewith [tenders in payment for such securities a certified or
official bank cashier's check payable to the order of CRYENCO SCIENCES, INC.
in the amount of $________ therefor] [instructs you herein, in payment of the
Exercise Price, to deduct ______ shares of Class A voting Common Stock and to
deliver the net number of shares, being ____ shares of Class A voting Common
Stock]. The undersigned requests that a certificate for such securities be
registered in the name of ______________ whose address is
______________________ and that such Certificate be delivered to
______________________ whose address is _________________.
Dated: Signature:________________________________
(Signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate.)
(Insert Social Security or Other
Identifying Number of Holder)
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<PAGE> 17
FORM OF ASSIGNMENT
(To be exercised by the registered holder if such holder desires to
transfer the Warrant Certificate to the extent permitted by Section 5
of the Warrant Agreement.)
FOR VAlUE RECEIVED ___________________________________________________
hereby sells, assigns and transfers unto
____________________________________________________
(Please print name and address of transferee)
this Warrant Certificate; together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _____________ Attorney, to
transfer the within Warrant Certificate on the books of the within-named
Company, with full power of substitution.
Dated: Signature: _____________________________________
(signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate.)
(Insert Social Security or Other
Identifying Number of Assignee)
-18-
<PAGE> 1
Exhibit 4.14
WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, March 11, 1998
No. W-1993B 50,000 Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that Don M. Harwell, or registered
assigns, is the registered holder of 50,000 Warrants to purchase initially, at
any time from March 12, 1993 until 5:30 p.m. Denver time on March 11, 1998
("Expiration Date"), up to 50,000 shares of Class A voting common stock, $.01
par value ("Common Stock") of CRYENCO SCIENCES, INC., a Delaware corporation
(the "Company") , at the price per share of Common Stock equal to the Exercise
Price set forth in the Warrant Agreement dated as of March 12, 1993 between
the Company and Don M. Harwell (the "Warrant Agreement"), upon surrender of
this Warrant Certificate and payment of the Exercise Price at an office or
agency of the Company, but subject to the conditions set forth herein and in
the Warrant Agreement. Payment of the Exercise Price shall be made by
certified or official bank cashier's check payable to the order of the
Company; PROVIDED, HOWEVER, that the holder hereof shall have the right, at
his or its election, in lieu of delivering the Exercise Price in cash, to
instruct the Company in the form of subscription to retain, in payment of the
Exercise Price, a number of shares of Common Stock (the "Payment Shares")
equal to the quotient of (i) the Exercise Price multiplied by the number of
shares as to which this Warrant is then being exercised divided by (ii) the
"Average Closing Price" as of the date of exercise and to deduct the number of
Payment Shares from the shares to be delivered to
<PAGE> 2
the holder hereof. "Average Closing Price" means, as of any date, (x) if
shares of Common Stock are listed on a national securities exchange, the
average of the closing sales prices therefor on the largest securities
exchange on which such shares are traded on the last ten (10) trading days
before such date, (y) if such shares are listed on the NASDAQ National Market
System but not on any national securities exchange, the average of the closing
sales prices therefor on the NASDAQ National Market System on the last ten
(10) trading days before the date of the exercise of the Warrants or (z) if
such shares are not listed on either a national securities exchange or the
NASDAQ National Market System, the average of the sales prices therefor on the
last twenty (20) trading days before the date of the exercise of the Warrants.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, hereby shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which
is hereby incorporated by reference in and made a part of this instrument and
is hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders or "holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
provided, however, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the holder as set forth in the Warrant Agreement to purchase the
number of shares for the exercise price as so adjusted or any other rights set
forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate
or Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in the
Warrant Agreement, without any charge except for any tax or other governmental
charge imposed in connection with such transfer.
-2-
<PAGE> 3
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate
to be duly executed under its corporate seal.
Dated as of March 12, 1993
CRYENCO SCIENCES, INC.
[SEAL] By: /s/ Alfred Schechter
-------------------------------
Name: Alfred Schechter
Title: President
Attest:
/s/ Alison A. Murray
- ------------------------
Name: Alison A. Murray
Title: Secretary
-3-
<PAGE> 1
Exhibit 4.15
WARRANT AGREEMENT
WARRANT AGREEMENT dated as of January 26, 1995 between CRYENCO
SCIENCES, INC., a Delaware corporation (the "Company"), and Don M. Harwell
(the " Holder").
1. GRANT. Subject to the terms of this Agreement, in consideration of
$10.00 and other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged by the Company, the Holder is hereby initially
granted the right to purchase, at any time and from time to time from January
26, 1995 until 5:30 p.m., Denver time on January 25, 2000 (the "Exercise
Period"), up to an aggregate of 25,000 shares of Common Stock at an initial
exercise price of $3.55. The adjusted exercise price shall be the price which
shall result from time to time from any and all adjustments of the initial
exercise price, in accordance with the provisions of SECTION 6 hereof. The term
"Exercise Price" herein shall mean the initial exercise price, as applicable
based on the date of exercise, or the adjusted exercise price, depending upon
the context.
2. WARRANT CERTIFICATES. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall
be in the form set forth in Exhibit A, attached hereto and made a part hereof,
with such appropriate insertions, omissions. substitutions and other variations
as required or permitted by this Agreement.
3. EXERCISE OF WARRANTS. The Warrants initially are exercisable at the
Exercise Price (subject to adjustment as provided in SECTION 6 hereof) per
share of Common Stock, payable by certified or official bank cashier's check
payable to the order of the Company: PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise
Price in cash, to instruct the Company in the form of subscription to retain,
in payment of the Exercise Price, a number of shares of Common Stock (the
"Payment Shares") equal to the quotient of (i) the Exercise Price multiplied by
the number of shares as to which the Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct the
number of Payment Shares from the shares to be delivered to the Holder.
"Average Closing Price" means, as of any date, (x) if shares of Common Stock
are listed on a national securities exchange, the average of the closing sales
prices therefor on the largest securities exchange on which such shares are
traded on the last 10 trading days before such date, (y) if such shares are
listed on the NASDAQ National Market System but not on any national securities
exchange, the average of the closing sales prices therefor on the NASDAQ
National Market System on the last 10 trading days before such date or (z) if
such shares are not listed on either a national securities exchange or the
NASDAQ National Market System, the average of the sales prices therefor on the
last 20 trading days before such date. Upon surrender of a Warrant Certificate
with the annexed Form of Election to Purchase duly executed, together with
payment of the Exercise Price for the shares of Common Stock at the Company's
principal offices (currently located at 3811 Joliet Street, Denver, Colorado
80239), the Holder or any subsequent registered holder or holders of a Warrant
Certificate (any such subsequent holder or holders also referred to herein as
the "Holder" or "Holders") shall be entitled to receive a
<PAGE> 2
certificate or certificates for the shares of Common Stock so purchased for the
Warrants so exercised. The purchase rights represented by each Warrant
Certificate are exercisable at the option of the Holder thereof, in whole or in
part (but not as to fractional shares of the Common Stock underlying the
Warrants). Warrants may be exercised to purchase all or part of the shares of
Common Stock represented thereby. In the case of the purchase of less than all
the securities purchasable under any Warrant Certificate, the Company shall
cancel said Warrant Certificate upon the surrender thereof and, unless the
Warrant has expired, shall execute and deliver a new Warrant Certificate of
like tenor for the balance of the securities purchasable thereunder. With
respect to any such exercise, the Holder shall for all purposes be deemed to
have become the holder of record of the number of shares of Common Stock from
the date on which the Warrant was surrendered and payment of the Exercise Price
was made irrespective of the date of delivery of such shares, except that, if
the date of such surrender and payment is a date on which the stock transfer
books of the Company are closed, such person shall be deemed to have become the
holder of such shares at the close of business on the next succeeding date on
which the stock transfer books are open.
4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the
issuance of certificates for the shares of Common Stock shall be made forthwith
(and in any event within 10 business days thereafter) without charge to the
Holder thereof including, without limitation, any tax which may be payable in
respect of the issuance thereof, and such certificates shall (subject to the
provisions of SECTIONS 5 and 7 hereof) be issued in the name of, or in such
names as may be directed by, the Holder thereof; provided, however, that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any such certificates in
a name other than that of the Holder and the Company shall not be required to
issue or deliver such certificates unless or until the person or persons
requesting the issuance thereof in a name other than that of the Holder 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.
The Warrant Certificates and the certificates representing the shares
of Common Stock shall be executed on behalf of the Company by the manual or
facsimile signature of the then present Chairman or Vice Chairman of the Board
of Directors or President or Vice President of the Company under its corporate
seal reproduced thereon, attested to by the dual or facsimile signature of the
then present Secretary or Assistant Secretary of the Company. Warrant
Certificates shall be dated the date of execution by the Company upon initial
issuance, division, exchange, substitution or transfer.
5. RESTRICTION ON TRANSFER OF WARRANTS.
There shall be not more than five (5) Holders of record of the
Warrants. The Holder of a Warrant Certificate, by his or its acceptance
thereof, covenants and agrees that the Warrants may not be sold, transferred,
assigned, hypothecated or otherwise disposed of, in whole or in part, except to
or among the Holder, his spouse and the Holder's children, any trust
2
<PAGE> 3
for the benefit of any such persons and any family foundations, who also shall
hold the warrants subject to the restrictions contained in this Section 5.
6. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES.
6.1 COMPUTATION OF ADJUSTED EXERCISE PRICE. For the purposes of this
SECTION 6 the term Exercise Price shall mean the Exercise Price per share of
Common Stock set forth in SECTION 1 hereof, as adjusted from time to time
pursuant to the provisions of this SECTION 6.
6.2 SUBDIVISION AND COMBINATIONS. In case the Company shall at any
time subdivide (for example, a stock split or stock dividend) or combine (for
example, a reverse stock split) the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
6.3 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this SECTION 6, the number of
securities issuable upon the exercise of each Warrant shall be adjusted to the
nearest full share by multiplying a number equal to the Exercise Price in
effect immediately prior to such adjustment by the number of shares of Common
Stock (or other securities as provided in this SECTION 6) issuable upon
exercise of the Warrants immediately prior to such adjustment and dividing the
product so obtained by the adjusted Exercise Price.
6.4 DEFINITION OF COMMON STOCK. For the purpose of this Agreement, the
term "Common Stock" shall mean (i) the class of stock designated as Class A
Voting Common Stock, $.01 par value, in the Restated Certificate of
Incorporation of the Company as of the date hereof, (ii) the class of stock
designated as Class B non-voting Convertible Common Stock, $.01 par value, in
the Restated Certificate of Incorporation, as amended, of the Company as of the
date hereof, (iii) any other capital stock of any class or classes (however
designated) of the Company the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of current
dividends and distributions on any shares entitled to preference except the
Series A Preferred Stock of the Company and (iv) any other securities into
which or for which any of the securities described in clauses (i), (ii) or
(iii) above have been converted, exchanged or combined pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise. In the
event that the Company shall after the date hereof issue securities with
greater or superior voting rights than the shares of Common Stock outstanding
as of the date hereof, the Holder, at his or its option, may receive upon
exercise of any Warrant either shares of Common Stock or an equal number of
such securities with greater or superior voting rights.
6.5 MERGER OR CONSOLIDATION. If any capital reorganization or
reclassification of the capital stock of the Company or any consolidation,
merger or other transaction of the Company with another corporation in which
the Company is the surviving corporation, or the sale of all or substantially
all of the Company's assets to another corporation shall be effected in such a
way that holders of Common Stock shall be entitled to receive consideration
(including
3
<PAGE> 4
but not limited to stock, securities or assets) with respect to or in exchange
for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provisions
shall be made whereby each Holder shall thereafter have the right to receive
upon the basis and upon the terms and conditions specified herein and in lieu
of the shares of Common Stock of the Company immediately theretofore so
receivable upon the exercise of each Warrant or Warrants, such shares of stock,
securities or assets (including cash) as may be issued or payable with respect
to or in exchange for a number of outstanding shares of such Common Stock equal
to the number of shares of such stock immediately theretofore so receivable had
such reorganization, reclassification, consolidation, merger or sale not taken
place, and in any such case appropriate provision shall be made with respect to
the rights and interests of such Holder to the end that the provisions hereof
(including, without limitation, provisions for adjustments of the Exercise
Price) shall thereafter be applicable, as nearly as may be, in relation to any
shares of stock, securities or assets thereafter deliverable upon the exercise
of such rights. In the event of a merger or consolidation of the Company or
other transaction in which the Company is not the surviving corporation or in
which, as the result of the transaction, no trading market will exist for the
Common Stock, the Company shall give notice regarding the transaction in
accordance with SECTION 12 hereof as soon as practicable (and in no event less
than 20 days prior to the record date fixed for the transaction or, if none,
the closing date for such transaction) in order to afford the Holders the
opportunity to exercise their Warrants and receive after exercise the same
consideration payable in the transaction to other holders of Common Stock. This
SECTION 6.5 shall similarly apply to successive reorganizations,
classifications, consolidations, mergers or other transaction contemplated
hereby.
6.6 NOTICE OF ADJUSTMENT. Upon any adjustment of the Exercise Price,
the Company shall give written notice thereof to each Holder in accordance with
SECTION 12 hereof, which notice shall state the Exercise Price resulting from
such adjustment, setting forth in reasonable detail the method of calculation
and the facts upon which such calculation is based.
7. REGISTRATION RIGHTS.
7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. The Warrants and
the shares of Common Stock have not been registered for sale under the Act.
Upon exercise of the Warrants, in part or in whole, certificates representing
the shares of Common Stock shall bear the following legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended ("Act"), and
may not be offered or sold except pursuant to (i) an effective
registration statement under the Act, (ii) to the extent applicable,
Rule 144 under the Act (or any similar rule under such Act relating to
the disposition of securities), or (iii) an opinion of counsel, if
such opinion shall be reasonably satisfactory to counsel to the issuer
that an exemption from registration under such Act is available.
4
<PAGE> 5
7.2 PIGGYBACK REGISTRATION.
(a) If, at any time commencing after the date hereof through
and including the fifth anniversary hereof the Company proposes to
register any of its equity securities under the Act (other than in
connection with a transaction contemplated by Rule 145(a) promulgated
under the Act or pursuant to Form S-8 or S-4 or successor forms) it
will give written notice by registered or certified mail, at least 15
days prior to the filing of each such registration statement, to the
Holders of the Warrants of its intention to do so. If the Holders of
the Warrants notify the Company within 15 days after receipt of any
such notice of its or their desire to include Common Stock underlying
the Warrants in such proposed registration statement, the Company
shall afford such Holders of the opportunity to have any such Common
Stock registered under such registration statement.
(b) In the case of an underwritten offering, if the managing
underwriter of the offering determines and advises the Company in
writing that inclusion of the Common Stock of the Holders requested to
be included would interfere with the successful offering of shares by
the Company there shall be excluded from such offering, to the extent
that the managing underwriter deems necessary, shares of Common Stock
owned by the Holders on a PRO RATA basis.
(c) Notwithstanding anything to the contrary herein, any
registration rights hereunder shall not be exercisable at any time or
with respect to any proposed registration unless each of Chemical Bank
and The CIT Group/Equity Investments, Inc. shall have exercised to the
fullest extent permitted by the applicable agreement with the Company
or waived any registration rights held by either of them at such time
or in connection with such registration.
7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In
connection with any registration under SECTION 7.2 hereof, the Company
covenants and agrees as follows:
(a) The Company shall pay all reasonable costs (excluding
transfer taxes, if any, and fees and expenses of Holder(s)' counsel
and any underwriting or selling commissions), fees and expenses in
connection with all registration statements filed pursuant to SECTION
7.2 hereof including, without limitation, the Company's legal and
accounting fees (including the costs and expenses of any special audit
or other procedures), printing expenses, blue sky fees and expenses.
(b) The Company will take all necessary action which may be
required in qualifying or registering the Common Stock included in a
registration statement for offering and sale under the securities or
blue sky laws of such states as reasonably are requested by the
Holder(s) provided, however, that the number of states in which
qualification or registration shall be required shall not exceed five
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<PAGE> 6
(5) and in no event shall the Company be required to effect such
qualification or registration if such act would require the Company to
qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction where it is not now so
qualified or required to file such a consent.
(c) Upon any registration becoming effective pursuant to this
SECTION 7, the Company shall use its best efforts to: (i) keep such
registration statement current for a period of 90 days; (ii) prepare
and file with the Securities and Exchange Commission (the
"Commission") such amendments and supplements to such registration
statement as may be necessary to comply with the provisions of the Act
and the Regulations of the Commission with respect to the disposition
of all securities covered by such registration statement; (iii) cause
all the Common Stock registered pursuant to such registration
statement to be listed on each exchange or automated quotation system
on which the Common Stock is then listed; (iv) provide a transfer
agent and registrar for all stock registered pursuant to such
registration statement and CUSIP number for all such stock, in each
case not later than the effective date of such registration; and (v)
otherwise use its best efforts to comply with all applicable rules and
regulations of the Commission.
(d) The Company shall indemnify and hold harmless the
Holder(s) of the Common Stock to be sold pursuant to any registration
statement and each person, if any, who controls such Holders within
the meaning of Section 15 of the Act or Section 20(a) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
against and from all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which any of
them may become subject under the Act, the Exchange Act or otherwise,
arising from such registration statement, except such matters in
respect of which such Holders are required to indemnify the Company
under the next succeeding paragraph.
(e) The Holders of the Common Stock to be sold pursuant to a
registration statement, and its or their successors and assigns, shall
indemnify and hold harmless the Company, its officers and directors
and each person, if any, who controls the Company within the meaning
of Section 15 of the Act or Section 20(a) of the Exchange Act, against
and from all loss, claim, damage, expense or liability (including all
expenses reasonably incurred in investigating, preparing or defending
against any claim whatsoever) to which they may become subject under
the Act, the Exchange Act or otherwise, arising from information
furnished by or on behalf of such Holders or its or their successors
or assigns, for specific inclusion in such registration statement.
(f) Any person entitled to indemnification under this SECTION
7 will (i) give prompt written notice to the indemnifying party of any
claim with respect to which it seeks indemnification and (ii) unless
in such indemnified party's
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<PAGE> 7
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 will not be subject to any
liability for any settlement made by the indemnified party without its
consent (but such consent will not be unreasonably withheld). An
indemnifying party who is not entitled to, or elects not to, assume
the defense of a claim will 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.
(g) Nothing contained in this Agreement shall be construed as
requiring the Holder to exercise his or its Warrants prior to the
initial filing of any registration statement or the effectiveness
thereof.
(h) The Company at its expense shall deliver promptly to each
Holder participating in the offering and requesting the correspondence
and memoranda described below copies of all documents proposed to be
filed with the Commission, all correspondence between the Commission
and the Company, its counsel or auditors, and all memoranda relating
to the registration statement and permit each such Holder at its
expense to do such investigation, upon reasonable advance notice, with
respect to information contained in or omitted from the registration
statement as it deems reasonably necessary to comply with applicable
securities laws or rules of the National Association of Securities
Dealers, Inc. Such investigation shall include access to books,
records and properties and opportunities to discuss the business of
the Company with its officers and independent auditors, all to such
reasonable extent and at such reasonable times and as often as any
such Holder shall reasonably request.
8. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of securities in such denominations as shall
be designated by the Holder thereof at the time of such surrender, subject to
the provisions of Section 5 hereof.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of any Warrant Certificate, and,
in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Warrant
Certificate, if mutilated, the Company will make and deliver a new Warrant
Certificate of like tenor, in lieu thereof.
7
<PAGE> 8
9. ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
upon the exercise of the Warrants, nor shall it be required to issue scrip or
pay cash in lieu of fractional interests, it being the intent of the parties
that all fractional interests shall be eliminated by rounding any fraction up
to the nearest whole number of shares of Common Stock or other securities,
properties or rights.
10. RESERVATION AND LISTING. The Company shall at times have and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon the exercise of the Warrants, such number of shares of Common
Stock or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants, and payment of the respective exercise price therefor, all shares of
Common Stock and other securities issuable upon such exercise shall, at the
time of delivery thereof, be duly and validly issued, fully paid,
nonassessable, not subject to the preemptive rights of any stockholder and free
from all taxes, liens and charges with respect to the issue thereof. The
Company will take all such action as may be necessary to ensure that all such
shares of Common Stock may be so issued without violation of any applicable law
or regulation, or of any requirements of any national securities exchange upon
which the Common Stock of the Company may be listed. The Company will not take
any action which results in any adjustment of the Exercise Price if the total
number of shares of Common Stock issued and issuable after such action upon
exercise of the Warrants would exceed the total number of shares of Common
Stock then authorized by the Company's Restated Certificate of Incorporation.
The Company has not granted and will not grant any right of first refusal with
respect to shares issuable upon exercise of the Warrants, and there are no
preemptive rights associated with such shares. As long as the Warrants shall be
outstanding, the Company shall use its best efforts to cause all shares of
Common Stock issuable upon exercise of the Warrants to be listed (subject to
official notice of issuance) on all securities exchanges, if any, on which the
Common Stock issued to the public in connection herewith may then be listed
and/or quoted on NASDAQ.
11. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement
shall be construed as conferring upon the Holders the right to vote or to
consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having
any rights whatsoever as a stockholder of the Company. If, however, at any time
prior to the expiration of the Warrants and their exercise, any of the
following events shall occur:
(a) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive a
dividend or distribution payable otherwise than in cash, or a cash
dividend or distribution payable otherwise than out of current or
retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
8
<PAGE> 9
(b) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or . exchangeable for shares of capital
stock of the Company, or any option, right or warrant to subscribe
therefor; or
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets and business as an
entity shall be proposed
then, in any one or more of said events, the Company shall give written notice
of such event at least 15 days prior to the date fixed as a record date or the
date of closing the transfer books for the determination of the stockholder
entitled to such dividend, distribution, convertible or exchangeable securities
or subscription rights, or entitled to vote on such proposed dissolution,
liquidation, winding up or sale. Such notice shall specify such record date or
the date of closing the transfer books, as the case may be. Failure to give
such notice or any defect therein shall not affect the validity of any action
taken in connection with the declaration or payment of any such dividend, or
the issuance of any convertible or exchangeable securities or subscription
rights, options or warrants or any proposed dissolution, liquidation, winding
up or sale.
12. NOTICES.
All notices, requests. consents and other communications
hereunder shall be in writing and shall be deemed to have been duly made when
delivered, or mailed by registered or certified mall, return receipt requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in SECTION 3
hereof or to such other address as the Company may designate by notice
to the Holders.
13. SUPPLEMENTS AND AMENDMENTS. The Company and the Holder may from
time to time supplement or amend this Agreement without the approval of any
subsequent Holders of Warrant Certificates (other than the Holder) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with provisions herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which the Company
and the Holder deem shall not adversely affect the interests of the Holders of
Warrant Certificates.
14. SUCCESSORS. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit of the Company, the Holders, the
limited partners of the Holder and their respective successors and assigns
hereunder.
9
<PAGE> 10
15. TERMINATION. This Agreement shall terminate at the close of
business on January 25, 2000. Notwithstanding the foregoing, the
indemnification provisions of Section 7 shall survive such termination until
the close of business on January 25, 2003.
16. GOVERNING LAW; SUBMISSION TO JURISDICTION. This Agreement and each
Warrant Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be construed
in accordance with the laws of said State without giving effect to the rules of
said State governing the conflicts of laws.
The Company and the Holders hereby agree that any action, proceeding
or claim against it arising out of, or relating in any way to, this Agreement
shall be brought and enforced in the courts of the state of New York or of the
United States of America for the Southern District of New York, and irrevocably
submits to such jurisdiction, which jurisdiction shall be exclusive. The
Company and the Holders hereby irrevocably waive any objection to such
exclusive jurisdiction or inconvenient forum. Any such process or summons to be
served upon any of the Company and the Holders (at the option of the party
bringing such action, proceeding or claim) may be served by transmitting a copy
thereof, by registered or certified mail, return receipt requested, postage
prepaid, addressed to it at the address set forth in SECTION 12 hereof. Such
mailing shall be deemed personal service and shall be legal and binding upon
the party so served in any action, proceeding or claim.
17. ENTIRE AGREEMENT; MODIFICATION. This Agreement contains the entire
understanding between the parties hereto with respect to the subject matter
hereof and may not be modified or amended except by a writing duly signed by
the party against whom enforcement of the modification or amendment is sought.
18. SEVERABILITY. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
19. CAPTIONS. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive
effect.
20. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Holder and any subsequent registered Holder(s) of the Warrant Certificates or
Warrants any legal or equitable right, remedy or claim under this Agreement;
and this Agreement shall be for the sole and exclusive benefit of the Company
and the Holder and subsequent Holder(s) of the Warrant Certificates or
Warrants.
21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and the
same instrument.
10
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
---------------------------
Name: Alfred Schechter
Title: President
Attest:
/s/ Alison A. Murray
- --------------------------
Name: Alison A. Murray
Title: Secretary
/s/ Don M. Harwell
----------------------------
Don M. Harwell
11
<PAGE> 12
EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, ____________, 2000
No. W-1995(A)_____ _______ Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that ________________________, or
registered assigns, is the registered holder of __________ Warrants to purchase
initially, at any time from _____________, 1995 until 5:30 p.m., Denver time,
on ________________, 2000 ("Expiration Date"), up to ______ shares of Class A
voting common stock, $.01 par value ("Common Stock") of CRYENCO SCIENCES, INC.,
a Delaware corporation (the "Company"), at the price per share of Common Stock
equal to the Exercise Price set forth in the Warrant Agreement dated as of
__________________, 1995 between the Company and ____________________ (the
"Warrant Agreement"), upon surrender of this Warrant Certificate and payment of
the Exercise Price at an office or agency of the Company, but subject to the
conditions set forth herein and in the Warrant Agreement. Payment of the
Exercise Price shall be made by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise
Price in cash, to instruct the Company in the form of subscription to retain,
in payment of the Exercise Price, a number of shares of Common Stock (the
"Payment Shares") equal to the quotient of (i) the Exercise Price multiplied by
the number of shares as to which the Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct the
number of Payment Shares from the shares to be delivered
12
<PAGE> 13
to the Holder. "Average Closing Price" means, as of any date, (x) if shares of
Common Stock are listed on a national securities exchange, the average of the
closing sales prices therefor on the largest securities exchange on which such
shares are traded on the 10 trading days before such date, (y) if such shares
are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last 10 trading days before such date or
(z) if such shares are not listed on either a national securities exchange or
the NASDAQ National Market System, the average of the sales prices therefor on
the last 20 trading days before such date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the Holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
provided, however, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the Holder as set forth in the Warrant Agreement to purchase the
number of shares for the exercise price as so adjusted or any other rights set
forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of Like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in the
Warrant Agreement, without any charge except for any tax or other
governmental charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the
13
<PAGE> 14
Holder(s) hereof, and for all other purposes, and the Company shall not be
affected by any notice to the contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Date as of ________________, 1995
CRYENCO SCIENCES, INC.
[SEAL]
By:___________________________
Name:
Title:
Attest:
_______________________
Name:
Title:
14
<PAGE> 15
FORM OF ELECTION TO PURCHASE
TO: Cryenco Sciences, Inc.
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
_____________ shares of Class A voting Common Stock;
and herewith [tenders in payment for such securities a certified or
official bank cashier's check payable to the order of CRYENCO SCIENCES, INC. in
the amount of $______________ therefor] [instructs you herein, in payment of
the Exercise Price, to deduct __________ shares of Class A voting Common Stock
and to deliver the net number of shares, being _________ shares of Class A
voting Common Stock]. The undersigned requests that a certificate for such
securities be registered in the name of __________________________ whose
address is ____________________________________________ and that such
Certificate be delivered to ________________________________ whose address is
_______________________________.
Dated: Signature: ________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Holder)
15
<PAGE> 16
FORM OF ASSIGNMENT
(To be exercised by the registered holder if such holder desires to
transfer the Warrant Certificate to the extent permitted by Section 5 of the
Warrant Agreement.)
FOR VALUE RECEIVED ______________________________________hereby sells,
assigns and transfers unto
________________________________________________________
(Please print name and address of transferee)
this Warrant Certificate; together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _________________________
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company, with full power of substitution.
Dated: Signature:_________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Assignee)
16
<PAGE> 1
Exhibit 4.16
WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, JANUARY 25, 2000
No. W-1995(A) 2 25,000 Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that Don M. Harwell, or registered
assigns, is the registered holder of 25,000 Warrants to purchase initially, at
any time from January 26, 1995 until 5:30p.m., Denver time, on January 25, 2000
("Expiration Date"), up to 25,000 shares of Class A voting common stock, $.01
par value ("Common Stock") of CRYENCO SCIENCES, INC., a Delaware corporation
(the "Company"), at the price per share of Common Stock equal to the Exercise
Price set forth in the Warrant Agreement dated as of January 26, 1995 between
the Company and Don M. Harwell (the "Warrant Agreement"), upon surrender of
this Warrant Certificate and payment of the Exercise Price at an office or
agency of the Company, but subject to the conditions set forth herein and in
the Warrant Agreement. Payment of the Exercise Price shall be made by certified
or official bank cashier's check payable to the order of the Company; PROVIDED,
HOWEVER, that the Holder shall have the right, at his or its election, in lieu
of delivering the Exercise Price in cash, to instruct the Company in the form
of subscription to retain, in payment of the Exercise Price, a number of shares
of Common Stock (the "Payment Shares") equal to the quotient of (i) the
Exercise Price multiplied by the number of shares as to which the Warrant is
then being exercised divided by (ii) the "Average Closing Price" as of the date
of exercise and to deduct the number of Payment Shares from the shares to be
delivered to the Holder. "Average Closing Price" means, as of any date, (x) if
shares of Common Stock are listed on a national securities exchange, the
average of the closing sales prices therefor on the largest securities exchange
on which such shares are traded on the 10 trading days before such date, (y) if
such shares are listed on the NASDAQ National Market System but not on any
national securities exchange, the average of the closing sales prices therefor
on the NASDAQ National Market System on the last 10 trading days before
<PAGE> 2
such date or (z) if such shares are not listed on either a national securities
exchange or the NASDAQ National Market System, the average of the sales prices
therefor on the last 20 trading days before such date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the Holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
PROVIDED, HOWEVER, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the rights
of the Holder as set forth in the Warrant Agreement to purchase the number of
shares for the exercise price as so adjusted or any other rights set forth in
the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the Holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
2
<PAGE> 3
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Date as of January 26, 1995
CRYENCO SCIENCES, INC
By: /s/ Alfred Schechter
[SEAL] --------------------------
Name: Alfred Schechter
Title: President
Attest:
/s/ Alison A. Murray
- --------------------------
Name: Alison A. Murray
Title: Secretary
3
<PAGE> 1
Exhibit 4.17
AMENDMENT NO.1 TO WARRANT AGREEMENT
This Amendment No.1 to Warrant Agreement is made as of this 31st day of
July, 1997, by and between Mr. Don M. Harwell (the "Holder"), Cryenco Sciences,
Inc., a Delaware corporation (f/k/a Cryenco Holdings, Inc.) ("Cryenco") and
Chart Industries, Inc., a Delaware corporation ("Chart").
WHEREAS, the Holder and Cryenco are parties to a warrant agreement or
agreements (the "Warrant Agreement") dated as of March 13, 1993 and January 26,
1995, pursuant to which Cryenco granted the Holder a warrant or warrants (the
"Cryenco Warrant") to purchase an aggregate of 75,000 shares of Cryenco Class A
common stock, par value $.01 per share (the "Cryenco Common Stock");
WHEREAS, Cryenco and Chart entered into a Plan and Agreement of Merger
dated as of April 30, 1997 (the "Merger Agreement") providing for the merger of
an affiliate of Chart into Cryenco (the "Merger") and the conversion of all
issued and outstanding Cryenco Common Stock (other than dissenters' shares) into
cash in the amount of $2.75 per share;
WHEREAS, in Section 5.4(b)(iii) of the Merger Agreement, Chart has
agreed to offer to grant a substitute warrant (the "Chart Warrant") to purchase
shares of Chart's common stock, par value $.0l per share (the "Chart Common
Stock"), in exchange for the Cryenco Warrant; and
WHEREAS, the Holder, Cryenco and Chart now desire that, in satisfaction
of Chart's obligations under Section 5.4(b)(iii) of the Merger Agreement, the
Cryenco Warrant be amended to provide the Holder with the right to purchase
Chart Common Stock in substitution for the right to purchase Cryenco Common
Stock;
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements and undertakings set forth herein, the parties hereby agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall
have the meaning ascribed to them in the Merger Agreement.
2. AMENDMENT. As of the effective time of the Merger (the "Effective
Time"), the Warrant Agreement and the form of Cryenco Warrant referenced therein
are hereby amended as follows:
(a) CHART COMMON STOCK SUBSTITUTED FOR CRYENCO COMMON STOCK. All
references to the right of the Holder to purchase shares of
Cryenco Common Stock shall be deleted and the right to
purchase shares of Chart Common Stock shall be substituted
therefor.
<PAGE> 2
(b) ADJUSTMENT TO NUMBER OF SHARES UNDERLYING WARRANT. The number
of shares of Chart Common Stock issuable upon exercise of the
warrant shall be the product of (i) the number of shares of
Cryenco Common Stock that were issuable upon exercise of the
Cryenco Warrant times (ii) a fraction (the "Exchange Ratio")
the numerator of which shall be $2.75 and the denominator of
which shall be the average of the closing sales price of Chart
Common Stock on the New York Stock Exchange as reported by the
Wall Street Journal for the ten trading days preceding the
Effective Time; provided, however, that in no event shall the
Exchange Ratio be less than .165 nor more than .206.
(c) ADJUSTMENT TO PURCHASE OR EXERCISE PRICE. The purchase or
exercise price per share of Chart Common Stock subject to the
Chart Warrant shall be equal to (i) the purchase or exercise
price per share of Cryenco Common Stock divided by (ii) the
Exchange Ratio.
(d) NOTICES. Any notices, requests, forms, certificates or other
documents or communications deliverable to Cryenco under the
Warrant Agreement shall be required to be delivered instead to
Chart at 35555 Curtis Boulevard, Eastlake, OH 44095, to the
attention of the Chief Financial Officer, with a copy to
Calfee, Halter & Griswold LLP, 1400 McDonald Investment
Center, 800 Superior Avenue, Cleveland, OH 44114, Attention:
Thomas F. McKee.
(e) SUBMISSION TO JURISDICTION. Any provision in the Warrant
Agreement requiring that any action, claim or proceeding
arising out of, or relating in any way to, the Warrant
Agreement be brought exclusively in a jurisdiction located in
the State of Colorado shall be deleted in its entirety.
(f) SUBSTITUTION OF WARRANTS. Chart and the Holder agree that any
and all Warrants and/or Warrant Certificates issued pursuant
to the Warrant Agreement shall be amended in a manner
consistent with the provisions of this Amendment No. 1 and
that, upon the Holder's presentation to Chart of such Warrants
or Warrant Certificates, Chart shall deliver to the Holder, in
exchange and substitution therefor, new Warrant or Warrant
Certificates.
3. FULL COMPLIANCE; ASSUMPTION OF CRYENCO'S OBLIGATIONS: REFERENCES TO
CRYENCO. The Holder acknowledges and agrees that, as of the Effective Time,
Cryenco is in full compliance with all of its obligations under the Warrant
Agreement, the Cryenco Warrant and any related agreements pertaining to
registration rights of the Holder with respect to the shares of Cryenco Common
Stock issuable upon exercise of the Warrants. As of the Effective Time, Chart
assumes all of the obligations of Cryenco under the Warrant Agreement as amended
hereby, and all references to Cryenco in the Warrant Agreement shall be deemed
to be
<PAGE> 3
references to Chart. To the extent that Holder is party to a separate
registration rights agreement relating to Cryenco Common Stock, promptly after
the Effective Time, Chart and the Holder shall enter into such supplemental
agreement as may be necessary to provide the Holder with equivalent registration
rights relating to Chart Common Stock issuable upon exercise of the Chart
Warrant.
4. RECEIPT OF CHART DISCLOSURES. The Holder acknowledges that it has
received copies of Chart's 1996 Form 10-K Report and Chart's Form 10-Q Report
for the three-month period ended March 31, 1997.
5. NO RIGHT TO PURCHASE CRYENCO COMMON STOCK. At and after the Effective
Time, the Holder shall be deemed to have surrendered any and all rights under
the Warrant Agreement and Warrant to purchase Cryenco Common Stock.
6. CONSENT TO AMENDMENT. By the execution and delivery of this Amendment
No. 1, the Holder shall be deemed to have consented to the terms hereof in
accordance with the terms of the Warrant Agreement.
7. NO OTHER AMENDMENTS. Except as specifically provided herein or as
otherwise necessary or appropriate to effectuate the intent of this Amendment
No. 1, the provisions of the Cryenco Warrant shall remain in full force and
effect without any alteration or modification thereto. Without limiting the
generality of the foregoing, the date of grant and the date of termination of
the Cryenco Warrant shall continue to be such dates as were in effect
immediately prior to the Effective Time.
8. SUCCESSORS AND ASSIGNS. This Agreement and all of the provisions
hereof shall be binding on and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
9. GOVERNING LAW. This Amendment No.1 shall be, and the Warrant Agreement
shall be amended to provide that it shall be, governed by and construed in
accordance with, the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
10. SEVERABILITY. if any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held to be invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
11. COUNTERPARTS. This Amendment No. 1 may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same instrument.
-3-
<PAGE> 4
IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of
the date first written above.
CHART INDUSTRIES, INC.
Attest: /s/ Suzanne Lines /s/ Don A. Baines
------------------------- -------------------------------
By: Don A. Baines
Title: CFO & Treasurer
HOLDER
Attest: /s/ LyNette Harwell /s/ Don M. Harwell
------------------------- -------------------------------
DON M. HARWELL
CRYENCO SCIENCES, INC.
Attest: /s/ Steve M. Lutt /s/ James A. Raabe
------------------------- -------------------------------
By: James A. Raabe
Title: VP & CFO
-4-
<PAGE> 1
EXHIBIT 4.18
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS
EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON
TRANSFER SET FORTH IN SECTION 4 OF THIS WARRANT
Warrant No. ICP-94-30 No. of Shares: 116,000
(subject to adjustment)
Date of Issuance: December 20, 1994
CRYENCO SCIENCES, INC.
CLASS A COMMON STOCK PURCHASE WARRANT
(Void after December 20, 1999)
Cryenco Sciences, Inc. (the "Company"), for value received, hereby
certifies that International Capital Partners, Inc., or his, her or its
registered assigns (the "Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company, at any time or from time to time on or
after April 20, 1995 and on or before December 20, 1999 (the "Exercise Period")
at not later than 5:00 p.m. (New York City time), 116,000 shares of Class A
Common Stock, $0.01 par value per share, of the Company ("Common Stock")
(subject to appropriate adjustment in the event of any stock dividend, stock
split, combination or other similar recapitalization affecting such Common
Stock), at a purchase price per share of $4.00. The number of shares
purchasable upon exercise of this Warrant, and the purchase price per share,
each as adjusted from time to time pursuant to the provisions of this Warrant,
are hereinafter referred to as the "Warrant Stock" and the "Purchase Price,"
respectively.
1. EXERCISE.
(a) The purchase right represented by this Warrant may be exercised by
the Holder hereof, in whole or in part, by the surrender of this Warrant (with
the purchase form attached hereto as EXHIBIT 1 duly executed) at the principal
office of the Company and by the payment to the Company, by certified or
official bank check drawn on a major money market bank with offices in New York
City or wire transfer, of an amount equal to the then applicable Purchase Price
multiplied by the number of shares then being purchased. The Company agrees
that the shares so purchased shall be deemed to be issued to the Holder hereof
as the record owner of such shares as of the close of business on
<PAGE> 2
the date on which this Warrant shall have been surrendered and payment made for
such shares as aforesaid. In the event of any exercise of this Warrant,
certificates for the shares of stock so purchased shall be delivered to the
Holder hereof within 15 days thereafter and, unless this Warrant has been fully
exercised or expired, a new warrant representing the portion of the shares, if
any, with respect to which this Warrant shall not then have been exercised,
shall also be issued to the Holder hereof within such 15 day period.
(b) CONVERSION. The Holder may convert this Warrant (the "Conversion
Right"), in whole or in part, into the number of shares of Common Stock of the
Company calculated pursuant to the following formula by surrendering this
Warrant at the principal office of the Company (together with a demand for
conversion in the form attached hereto as EXHIBIT 2 duly executed) ("Conversion
Demand") specifying the number of shares of Common Stock of the Company, the
rights to purchase which the Holder desires to convert:
Y (A-B)
-------
X= A
where: X = the number of shares of Common Stock to be issued to the
Holder
Y = the number of shares of Common Stock subject to this Warrant
for which the Conversion Right is being exercised;
A = the fair market value of one share of Common Stock;
B = the Purchase Price
As used herein, the fair market value of a share of Common Stock shall
mean with respect to each share of Common Stock the closing price per share of
the Company's Common Stock on the principal national securities exchange on
which the Common Stock is then listed or admitted to trading or, if not then
listed or admitted to trading on any such exchange, on the NASDAQ National
Market System, or if not then listed or traded on any such exchange or system,
the bid price per share on the NASDAQ Small-Cap Market, averaged over the 10
trading days consisting of the day as of which the current fair market value
of Common Stock is being determined (which day shall be the date two (2) days
prior to which the Conversion Demand is, as applicable, delivered by hand,
telecopied, placed in the mails or delivered to a private courier) and the
nine consecutive business days prior to such day. If at any time such
quotations are not available, the current fair market value of a share of
Common Stock shall be the
2
<PAGE> 3
highest price per share which the Company could obtain from a willing buyer
(not a current employee or director) for shares of Common Stock sold by the
Company, from authorized but unissued shares, as determined in good faith by
the Board of Directors of the Company, unless the Company shall become subject
to a merger, acquisition or other consolidation pursuant to which the Company
is not the surviving party, in which case the current fair market value of a
share of Common Stock shall be deemed to be the value received by the holders
of the Company's Common Stock for each share of Common Stock pursuant to the
Company's acquisition. The Company agrees that the shares so converted shall be
deemed to be issued to the Holder hereof as the record owner of such shares as
of the close of business on the date on which this Warrant shall have been
surrendered as aforesaid. In the event of any conversion of this Warrant,
certificates for the shares of stock so converted shall be delivered to
the Holder hereof within 15 days thereafter and, unless this Warrant has been
fully converted or expired, a new Warrant representing the portion of the
shares, if any, with respect to which this Warrant shall not then have been
converted, shall also be issued to the Holder hereof within such 15 day period.
Exercise of the foregoing Conversion Rights shall be deemed an exercise of this
Warrant for all purposes hereunder. Any adjustments in the Purchase Price or
number or type of securities or other property which the Holder is entitled to
receive upon exercise of this Warrant shall also apply MUTATIS MUTANDIS to the
Conversion Rights provided for herein.
2. ANTI-DILUTION PROVISIONS.
(a) ADJUSTMENT FOR RECAPITALIZATION. If outstanding shares of the
Company's Common Stock shall be subdivided into a greater number of shares or a
dividend in Common Stock shall be paid in respect of Common Stock, the Purchase
Price in effect immediately prior to such subdivision or at the record date of
such dividend shall simultaneously with the effectiveness of such subdivision
or immediately after the record date of such dividend be proportionately
reduced. If outstanding shares of Common Stock shall be combined into a smaller
number of shares, the Purchase Price in effect immediately prior to such
combination shall, simultaneously with the effectiveness of such combination,
be proportionately increased. When any adjustment is required to be made in the
Purchase Price, the number of shares of Warrant Stock purchasable upon the
exercise of this Warrant shall be changed to the number determined by dividing
(i) an amount equal to the number of shares issuable upon the exercise of
this Warrant immediately prior to such adjustment, multiplied by the Purchase
Price in effect immediately prior to such adjustment, by (ii) the Purchase
Price in effect immediately after such adjustment.
3
<PAGE> 4
(b) ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC. If there
shall occur any capital reorganization or reclassification of the Company's
Common Stock (other than a change in par value or a subdivision or combination
as provided for in subsection 2(a) above), or any consolidation or merger of the
Company with or into another corporation, or a transfer of all or substantially
all of the assets of the Company, then, as part of any such reorganization,
reclassification, consolidation, merger or sale, as the case may be, lawful
provision shall be made so that the Holder of this Warrant shall have the right
thereafter to receive upon the exercise hereof the kind and amount of shares of
stock or other securities or property which such Holder would have been entitled
to receive if, immediately prior to any such reorganization, reclassification,
consolidation, merger or sale, as the case may be, such Holder had held the
number of shares of Common Stock which were then purchasable upon the exercise
of this Warrant. In any such case, appropriate adjustment (as reasonably
determined by the Board of Directors of the Company) shall be made in the
application of the provisions set forth herein with respect to the rights and
interests thereafter of the Holder of this Warrant such that the provisions set
forth in this Section 2 (including provisions with respect to adjustment of the
Purchase Price) shall thereafter be applicable, as nearly as is reasonably
practicable, in relation to any shares of stock or other securities or property
thereafter deliverable upon the exercise of this Warrant.
(c) ADJUSTMENTS FOR SALE OF SHARES OF COMMON STOCK BELOW PURCHASE PRICE.
(i) SPECIAL DEFINITIONS. For purposes of this Subsection 2(c),
the following definitions shall apply:
(A) "OPTION" shall mean rights, options or warrants to
subscribe for, purchase or otherwise acquire Common Stock or Convertible
Securities (collectively, "Rights"), excluding (1) Rights granted by
the Company prior to the Original Issue Date; (2) up to 20,000 shares of
Class A Common Stock issued upon exercise of options, if any, granted
after the Original Issue Date under the Company's 1986 Non-Qualified
Stock Option Plan and up to 79,000 shares of Class A Common Stock issued
upon exercise of options, if any, granted after the Original Issue Date
under the Company's 1992 Employee Incentive and Non-Qualified Stock
Option Plan and up to 36,000 shares of Class A Common Stock issued upon
exercise of options, if any, granted after the Original Issue Date under
the Company's 1993 Non-Employee Director Stock Option Program; (3) up to
an aggregate of 65,000,000 shares of Class A Common Stock issued upon
exercise of warrants to purchase such
4
<PAGE> 5
Common Stock, if any, issued, whether before or after the Original Issue
Date, to one or more of Alfred Schechter, Don M. Harwell and Mezzanine
Capital Corporation Limited and warrants to purchase up to an aggregate
of 25,000 shares of Class A Common Stock, if any, issued to The Edgehill
Corporation on or about the Original Issue Date; and (4) Rights to
acquire up to 272,267 additional shares of Class A Common Stock.
(B) "ORIGINAL ISSUE DATE" shall mean December 20,
1994.
(C) "CONVERTIBLE SECURITIES" shall mean any evidences
of indebtedness, shares or other securities directly or indirectly
convertible into or exchangeable for Common Stock.
(D) "ADDITIONAL SHARES OF COMMON STOCK" shall mean all
shares of Common Stock issued (or, pursuant to Subsection 2(c)(iii)
below, deemed to be issued) by the Company after the Original Issue
Date, other than shares of Common Stock issued or issuable:
(1) by reason of a dividend, stock split,
split-up or other distribution on shares of Common Stock issued
(or pursuant to Subsection 2(c)(iii) below deemed to be issued)
by the Company after the Original Issue Date; or
(2) pursuant to or upon the exercise of Rights
excluded from the definition of "Option" in Subsection 2(c)
(i)(A).
(E) "WARRANT HOLDERS" shall mean the Holder of this
Warrant and the holders of all other Warrants, from time to time, issued
in connection with the sale of the Shares and Warrants pursuant to that
certain Purchase Agreement dated November 29, 1994 by and among the
Company, International Capital Partners, Inc. and the Purchasers defined
therein, as amended (the "Purchase Agreement") and executed and
delivered simultaneously with this Warrant, for so long as such holders
shall hold the Warrants issued pursuant to the Purchase Agreement.
(ii) NO ADJUSTMENT OF PURCHASE PRICE. No adjustment in the
number of shares of Common Stock into which the Warrant is exercisable
shall be made by adjustment in the applicable Purchase Price thereof;
(a) unless the consideration per share (determined
5
<PAGE> 6
pursuant to Subsection 2(c)(v) for an Additional Share of Common Stock
issued or deemed to be issued by the Company is less than the applicable
Purchase Price in effect on the date of, and immediately prior to, the
issue of such Additional Shares of Common Stock, or (b) if prior to such
issuance, the Company receives written notice from the holders of at
least a majority of the then Warrant Holders agreeing that no such
adjustment shall be made as the result of the issuance of Additional
Shares of Common Stock.
(iii) ISSUE OF SECURITIES DEEMED ISSUE OF ADDITIONAL SHARES OF
COMMON STOCK.
(A) If the Company at any time or from time to time
after the Original Issue Date shall issue any Options or Convertible
Securities or shall fix a record date for the determination of holders
of any class of securities entitled to receive any such Options or
Convertible Securities, then the maximum number of shares of Common
Stock (as set forth if the instrument relating thereto without regard to
any provision contained therein for a subsequent adjustment of such
number) issuable upon the exercise of such Options or, in the case of
Convertible Securities and Options therefor, the conversion or exchange
of such Convertible Securities, shall be deemed to be Additional Shares
of Common Stock issued as of the time of such issue or, in case such a
record date shall have been fixed, as of the close of business on such
record date, provided that Additional Shares of Common Stock shall not
be deemed to have been issued unless the consideration per share
(determined pursuant to Subsection 2(c)(v) hereof) of such Additional
Shares of Common Stock would be less than the applicable Purchase Price
in effect on the date of and immediately prior to such issue, or such
record date, as the case may be.
(B) No further adjustment in the Purchase Price shall be
made upon the subsequent issue of Convertible Securities or shares of
Common Stock upon the exercise of such Options or conversion or exchange
of such Convertible Securities.
(C) If such Options or Convertible Securities by their
terms provide, with the passage of time or otherwise, for any increase
in the consideration payable to the Company, or decrease in the number
of shares of Common Stock issuable, upon the exercise, conversion or
exchange thereof, the Purchase Price computed upon the original issue
thereof (or upon
6
<PAGE> 7
the occurrence of a record date with respect thereto), and any subsequent
adjustments based thereon, shall, upon any such increase or decrease becoming
effective, be recomputed to reflect such increase or decrease insofar as it
affects such Options or the rights of conversion or exchange under such
Convertible Securities.
(D) No readjustment pursuant to clause (C) above shall have the effect
of increasing the Purchase Price to an amount which exceeds the lower of (1)
the Purchase Price on the original adjustment date, or (2) the Purchase Price
that resulted from any other issuance of Additional Shares of Common Stock
between the original adjustment date and such readjustment date.
(E) Upon the expiration or termination of any unexercised Option, the
Purchase Price shall be readjusted as if the expired or terminated Options had
never been issued, and the Additional Shares of Common Stock deemed issued as
the result of the original issue of such Option shall not be deemed issued
for the purposes of any subsequent adjustment of the Purchase Price.
(F) In the event of any change in the number of shares of Common Stock
issuable upon the exercise, conversion or exchange of any Option or Convertible
Security, including, but not limited to, a change resulting from the
anti-dilution provisions thereof, the Purchase Price then in effect shall
forthwith be readjusted to such Purchase Price as would have been obtained had
the adjustment which was made upon the issuance of such Option or Convertible
Security not exercised or converted prior to such change been made upon the
basis of such change but no further adjustment shall be made for the actual
issuance of Common Stock upon the exercise or conversion of any such
Option or Convertible Security.
(iv) ADJUSTMENT OF PURCHASE PRICE UPON ISSUANCE OF ADDITIONAL SHARES OF
COMMON STOCK. In the event the Company shall at any time after the Original
Issue Date issue Additional Shares of Common Stock (including Additional
Shares of Common Stock deemed to be issued pursuant to Subsection 2(c)(iii),
but excluding shares issued upon a stock split or combination or as a dividend
or distribution as provided in Subsection 2(a)) without consideration or for a
consideration per share less than the applicable Purchase Price in effect
7
<PAGE> 8
on the date of and immediately prior to such issue, then, and in such event,
such Purchase Price shall be reduced, concurrently with such issue, to a price
(calculated to the nearest cent) determined by multiplying such Purchase Price
by a fraction, (A) the numerator of which shall be (1) the number of shares of
Common Stock outstanding immediately prior to such issue plus (2) the number of
shares of Common Stock which the aggregate consideration received by the
Company for the total number of Additional Shares of Common Stock so issued
would purchase at such Purchase Price; and (B) the denominator of which shall
be the number of shares of Common Stock outstanding immediately prior to such
issue plus the number of such Additional Shares of Common Stock so issued;
PROVIDED THAT, for the purpose of this Subsection 2(c)(iv), all shares of
Common Stock issuable upon exercise of the Warrants outstanding immediately
prior to such issue shall be deemed to be outstanding, and immediately after
any Additional Shares of Common Stock are deemed issued pursuant to Subsection
2(c)(iii) (other than shares excluded from the definition of "Additional Shares
of Common Stock"), such Additional Shares of Common Stock shall be deemed to be
outstanding.
Notwithstanding the foregoing, the applicable Purchase Price shall not
be so reduced at such time if the amount of such reduction would be an amount
less than $.01, but any such amount shall be carried forward and reduction with
respect thereto made at the time of and together with any subsequent reduction
which, together with such amount and any other amount of amounts so carried
forward, shall aggregate $.01 or more.
(v) DETERMINATION OF CONSIDERATION. For purposes of this Subsection
2(c), the consideration received by the Company for the issue of any Additional
Shares of Common Stock shall be computed as follows:
(A) CASH AND PROPERTY: Such consideration shall:
(1) insofar as it consists of cash, be computed at the
aggregate of cash received by the Company, excluding amounts paid or
payable for accrued interest or accrued dividends;
(2) insofar as it consists of property other than cash, be
computed at the fair market value thereof at the time of such issue,
as
8
<PAGE> 9
determined in good faith by the Board of Directors; and
(3) in the event Additional Shares of Common Stock are issued
together with other shares or securities or other assets of the
Company for consideration which covers both, be the proportion of such
consideration so received, computed as provided in clauses (1) and (2)
above, as determined in good faith by the Board of Directors.
(B) OPTIONS AND CONVERTIBLE SECURITIES. The consideration per share
received by the Company for Additional Shares of Common Stock deemed to have
been issued pursuant to Subsection 2(c)(iii) relating to Options and Convertible
Securities shall be determined by dividing (x) the total amount, if any,
received or receivable by the Company as consideration for the issue of such
Options or Convertible Securities, plus the minimum aggregate amount of
additional consideration (as set forth in the instruments relating thereto,
without regard to any provision contained therein for a subsequent adjustment of
such consideration) payable to the Company upon the exercise of such Options or
the conversion or exchange of such Convertible Securities, or in the case of
Options for Common Stock, the exercise of such Options for Convertible
Securities and the conversion or exchange of such Convertible Securities, by (y)
the maximum number of shares of Common Stock (as set forth in the instruments
relating thereto, without regard to any provision contained therein for a
subsequent adjustment of such number) issuable upon the exercise of such Options
or the conversion or exchange of such Convertible Securities.
(d) CERTIFICATES AS TO ADJUSTMENTS. When any adjustment is required to
be made in the Purchase Price, the Company at its expense shall promptly
compute such adjustment in accordance with the terms of the Warrant and prepare
a certificate executed by two officers of the Company setting forth such
adjustment and showing in detail the facts upon which such adjustment is based.
The Company shall forthwith mail to each Holder a copy of such certificate.
Such certificate shall also set forth the kind and amount of stock or other
securities or property into which this Warrant shall be exercisable following
the occurrence of any of the events specified in this Section 2.
3. FRACTIONAL SHARES. The Company shall not be required upon the
exercise of this Warrant to issue any
9
<PAGE> 10
fractional shares. In lieu of delivering such fractional interest, the Company
shall pay an amount to the Holder equal to the fair market value of such
fractional interest as of the date of exercise.
4. LIMITATION ON SALES, ETC. Each Holder of this Warrant acknowledges
that this Warrant and the Warrant Stock have not been registered under the
Securities Act of 1933, as amended (the "Act"), and agrees not to sell, pledge,
distribute, offer for sale, transfer or otherwise dispose of this Warrant or
any Warrant Stock issued upon its exercise in the absence of (a) an effective
registration statement under the Act as to this Warrant or such Warrant Stock,
or (b) an applicable exemption from such registration under such Act. Each
certificate or other instrument for Warrant Stock issued upon the exercise of
this Warrant shall bear a legend substantially to the foregoing effect.
Notwithstanding the foregoing, the Holder may require the Company to
issue a certificate representing the Warrant Stock without a legend in
substitution for a legended certificate representing the Warrant Stock if
either (i) such Warrant Stock has been registered for resale under the Act or
(ii) such registration is no longer required under applicable law.
5. NO IMPAIRMENT. The Company will not, by amendment of its
Certificate of Incorporation or through reorganization, consolidation, merger,
dissolution, sale of assets or any other voluntary action, avoid or seek to
avoid the observance or performance of any of the terms of this Warrant, but
will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such action as may be necessary or appropriate in
order to protect the rights of the Holder of this Warrant against impairment.
6. LIQUIDATING DIVIDENDS. If the Company pays a dividend or makes a
distribution on the Common Stock payable otherwise than in cash out of earnings
or earned surplus (determined in accordance with generally accepted accounting
principles) except for a stock dividend payable in shares of Common Stock (a
"Liquidating Dividend"), then the Company will pay or distribute to the Holder
of this Warrant, upon the exercise hereof, in addition to the Warrant Stock
purchased upon such exercise, the Liquidating Dividend which would have been
paid to such Holder if he, she or it had been the owner of record of such
shares of Warrant Stock immediately prior to the date on which a record is
taken for such Liquidating Dividend or, if no record is taken, the date as of
which the record holders of Common Stock entitled to such dividends or
distribution are to be determined.
10
<PAGE> 11
7. NOTICES OF RECORD DATE, ETC. In case:
(a) The Company shall choose a date on which a record is to be taken of
the holders of its Common Stock (or other stock or securities at the time
deliverable upon the exercise of this Warrant) for the purpose of entitling or
enabling them to receive any dividend or other distribution, or to receive any
right to subscribe for or purchase any shares of stock of any class or any other
securities, or to receive any other right, or
(b) of any capital reorganization of the Company, any reclassification
of the capital stock of the Company, any consolidation or merger of the Company
with or into another corporation (other than a consolidation or merger in which
the Company is the surviving entity), or any transfer of all or substantially
all of the assets of the Company, or
(c) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company, then, and in each such case, the Company will mail
or cause to be mailed to the Holder of this Warrant a notice specifying, as the
case may be, (i) the date on which a record is to be taken for the purpose of
such dividend, distribution or right, and stating the amount and character of
such dividend, distribution or right, or (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up is to take place, and the time, if any is to be
fixed, as of which the holders of record of Common Stock (or such other stock
or securities at the time deliverable upon the exercise of this Warrant) shall
be entitled to exchange their shares of Common Stock (or such other stock or
securities) for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up. Such notice shall be mailed at least ten (10) days
prior to the record date or effective date for the event specified in such
notice.
8. RESERVATION OF STOCK. The Company will at all times reserve and
keep available, solely for issuance and delivery upon the exercise of this
Warrant, such shares of Warrant Stock and other stock, securities and property,
as from time to time shall be issuable upon the exercise of this Warrant. All
such shares shall be duly authorized and, when issued upon such exercise, shall
be validly issued, fully paid and nonassessable, free and clear of all liens,
security interests, charges and other encumbrances or restrictions on sale
(other than any restrictions on transfer which may arise under any applicable
federal or state securities laws) and free and clear of all preemptive rights.
11
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9. EXCHANGE OF WARRANTS. Upon the surrender by the Holder of any
Warrant or Warrants, properly endorsed, to the Company at the principal office
of the Company, the Company will, subject to the provisions of Section 4
hereof, issue and deliver to or upon the order of such Holder, at the Company's
expense, a new Warrant or Warrants of like tenor, in the name of such Holder or
as such Holder (upon payment by such Holder of any applicable transfer taxes)
may direct, calling in the aggregate on the face or faces thereof for the
number of shares of Common Stock called for on the face or faces of the Warrant
or Warrants so surrendered.
10. REPLACEMENT OF WARRANTS. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of
an indemnity agreement in an amount reasonably satisfactory to the Company, or
(in the case of mutilation) upon surrender and cancellation of this Warrant, the
Company at its expense (other than with respect to any legal fees incurred by
the Holder which shall be at the Holder's expense) will issue, in lieu thereof,
a new Warrant of like tenor.
11. TRANSFERS, ETC.
(a) The Company will maintain a register containing the names and
addresses of the registered Holders of this Warrant. Any Holder may change its,
his or her address as shown on the warrant register by written notice to the
Company requesting such change.
(b) Subject to the provisions of Section 4 hereof, this Warrant and all
rights hereunder are transferable, in whole or in part, upon surrender of this
Warrant with a properly executed assignment (in the form of EXHIBIT 3 hereto)
at the principal office of the Company.
(c) Until any transfer of this Warrant is made in the warrant register,
the Company may treat the registered Holder of this Warrant as the absolute
owner hereof for all purposes; provided, however, that if and when this Warrant
is properly assigned in blank, the Company may (but shall not be obligated to)
treat the bearer hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary.
12. MAILING OF NOTICES, ETC. All notices and other communications from
the Company to the Holder of this Warrant shall be mailed by first-class
certified or registered mail, postage prepaid, to the address furnished to the
Company in writing by the last registered Holder of this Warrant who shall have
furnished an address to the Company in writing. All notices
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<PAGE> 13
and other communications from the Holder of this Warrant or in connection
herewith to the Company shall be mailed by first-class certified or registered
mail, postage prepaid, to the Company at its principal office set forth below.
If the Company should at any time change the location of its principal office
to a place other than as set forth below, it shall give prompt written notice
to the registered Holder of this Warrant and thereafter all references in this
Warrant to the location of its principal office at the particular time shall be
as so specified in such notice.
13. NO RIGHTS AS STOCKHOLDER. Until the exercise of this Warrant, the
Holder of this Warrant shall not have or exercise any rights by virtue hereof
as a stockholder of the Company.
14. CHANGE OR WAIVER. Any term of this Warrant may be changed or waived
only by an instrument in writing signed by the party against which enforcement
of the change or waiver is sought.
15. HEADINGS. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
16. GOVERNING LAW. This Warrant will be governed by and construed in
accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed and issued by its officers thereunto duly authorized as of this
20th day of December, 1994.
[Corporate Seal] CRYENCO SCIENCES, INC.
BY: /s/ Alfred Schechter
---------------------------
Name: Alfred Schechter
Title: President
3811 Joliet Street
Denver, Colorado 80239
ATTEST:
_______________________________
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<PAGE> 14
EXHIBIT 1
PURCHASE FORM
-------------
To: Dated:
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. __), hereby irrevocably elects to purchase ______ shares of the
Class A Common Stock covered by such Warrant and herewith makes payment of
$__________, representing the full purchase price for such shares at the price
per share provided for in such Warrant.
Signature ________________________________
Address: _________________________________
EXHIBIT 2
CONVERSION FORM
---------------
To: Dated:
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. __), hereby irrevocably elects to convert ______ shares subject to
this Warrant into __________ shares of the Class A Common Stock as provided for
in such Warrant,
If fewer than all of the shares subject to this Warrant are being
converted hereby, please return to the undersigned a new Warrant for the
remaining shares as provided in the Warrant.
Signature ________________________________
Address: _________________________________
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<PAGE> 15
EXHIBIT 3
ASSIGNMENT FORM
---------------
FOR VALUE RECEIVED, ________________________________ hereby sells,
assigns and transfers all of the rights of the undersigned under the attached
Warrant (No. __) with respect to the number of shares of Class A Common Stock
covered thereby set forth below, unto:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
- ---------------- ------- -------------
15
<PAGE> 16
CRYENCO SCIENCES, INC.
3811 Joliet Street
Denver, Colorado 80239
June 8, 1995
International Capital Partners, Inc.
300 First Stamford Place
Stamford, CT 06902
Attn: Ajit G. Hutheesing, Chairman
Ladies and Gentlemen:
Reference is made to the Letter Agreement dated May 18, 1995 (the
"Letter Agreement") among Cryenco Sciences, Inc., a Delaware corporation (the
"Corporation"), International Capital Partners, Inc. ("ICP") and the Purchasers
listed on Schedule I thereto. Terms used herein and not otherwise defined shall
have the meanings attributed thereto in the Letter Agreement.
This letter will serve to confirm that pursuant to Paragraph 1 of the
Letter Agreement, effective June 8, 1995 the initial Purchase Price with
respect to Warrant No. ICP-94-30 and Warrant No. ICP-95-31 issued by the
Corporation to ICP on December 20, 1994 and January 30, 1995, respectively,
shall be $3.00 per share. Please annex a copy of this letter to Warrant No.
ICP-94-30 and No. ICP-95-31 as evidence of the reduction of the Purchase Price.
Very truly yours,
CRYENCO SCIENCES, INC.
BY: /s/ Alfred Schechter
------------------------
Name: Alfred Schechter
Title: President
<PAGE> 1
Exhibit 4.19
THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS
EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON
TRANSFER SET FORTH IN SECTION 4 OF THIS WARRANT
Warrant No. ICP-95-91 No. of Shares: 44,000
(subject to adjustment)
Date of Issuance: January 30, 1995
CRYENCO SCIENCES, INC.
Class A Common Stock Purchase Warrant
-------------------------------------
(Void after January 30, 2000)
Cryenco Sciences, Inc. (the "Company"), for value received, hereby
certifies that International Capital Partners, Inc., or his, her or its
registered assigns (the "Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company, at any time or from time to time on or
after May 30, 1995 and on or before January 30, 2000 (the "Exercise Period") at
not later than 5:00 p.m. (New York City time), 44,000 shares of Class A Common
Stock, $0.01 par value per share, of the Company ("Common Stock") (subject to
appropriate adjustment in the event of any stock dividend, stock split,
combination or other similar recapitalization affecting such Common Stock), at
a purchase price per share of $4.00. The number of shares purchasable upon
exercise of this Warrant, and the purchase price per share, each as adjusted
from time to time pursuant to the provisions of this Warrant, are hereinafter
referred to as the "Warrant Stock" and the "Purchase Price," respectively.
1. Exercise.
--------
(a) The purchase right represented by this Warrant may be exercised by
the Holder hereof, in whole or in part, by the surrender of this Warrant (with
the purchase form attached hereto as EXHIBIT 1 duly executed) at the principal
office of the Company and by the payment to the Company, by certified or
official bank check drawn on a major money market bank with offices in New York
City or wire transfer, of an amount equal to the then applicable Purchase Price
multiplied by the number of shares then being purchased. The Company agrees
that the shares so purchased shall be deemed to be issued to the Holder hereof
as the record owner of such shares as of the close of business on
1
<PAGE> 2
the date on which this Warrant shall have been surrendered and payment made for
such shares as aforesaid. In the event of any exercise of this Warrant,
certificates for the shares of stock so purchased shall be delivered to the
Holder hereof within 15 days thereafter and, unless this Warrant has been fully
exercised or expired, a new warrant representing the portion of the shares, if
any, with respect to which this Warrant shall not then have been exercised,
shall also be issued to the Holder hereof within such 15 day period.
(B) CONVERSION. The Holder may convert this Warrant (the "Conversion
Right"), in whole or in part, into the number of shares of Common Stock of the
Company calculated pursuant to the following formula by surrendering this
Warrant at the principal office of the Company (together with a demand for
conversion in the form attached hereto as EXHIBIT 2 duly executed) ("Conversion
Demand") specifying the number of shares of Common Stock of the Company, the
rights to purchase which the Holder desires to convert:
Y(A-B)
------
X = A
where: X = the number of shares of Common Stock to be issued to the
Holder
Y = the number of shares of Common Stock subject to this
Warrant for which the Conversion Right is being exercised;
A = the fair market value of one share of Common Stock;
B = the Purchase Price
As used herein, the fair market value of a share of Common Stock shall
mean with respect to each share of Common Stock the closing price per share of
the Company's Common Stock on the principal national securities exchange on
which the Common Stock is then listed or admitted to trading or, if not then
listed or admitted to trading on any such exchange, on the NASDAQ National
Market System, or if not then listed or traded on any such exchange or system,
the bid price per share on the NASDAQ Small-Cap Market, averaged over the 10
trading days consisting of the day as of which the current fair market value of
Common Stock is being determined (which day shall be the date two (2) days
prior to which the Conversion Demand is, as applicable, delivered by hand,
telecopied, placed in the mails or delivered to a private courier) and the nine
consecutive business days prior to such day. If at any time such quotations are
not available, the current fair market value of a share of Common Stock shall
be the
2
<PAGE> 3
highest price per share which the Company could obtain from a willing buyer
(not a current employee or director) for shares of Common Stock sold by the
Company, from authorized but unissued shares, as determined in good faith by
the Board of Directors of the Company, unless the Company shall become subject
to a merger, acquisition or other consolidation pursuant to which the Company
is not the surviving party, in which case the current fair market value of a
share of Common Stock shall be deemed to be the value received by the holders
of the Company's Common Stock for each share of Common Stock pursuant to the
Company's acquisition. The Company agrees that the shares so converted shall be
deemed to be issued to the Holder hereof as the record owner of such shares as
of the close of business on the date on which this Warrant shall have been
surrendered as aforesaid. In the event of any conversion of this Warrant,
certificates for the shares of stock so converted shall be delivered to the
Holder hereof within 15 days thereafter and, unless this Warrant has been fully
converted or expired, a new Warrant representing the portion of the shares, if
any, with respect to which this Warrant shall not then have been converted,
shall also be issued to the Holder hereof within such 15 day period. Exercise
of the foregoing Conversion Rights shall be deemed an exercise of this Warrant
for all purposes hereunder. Any adjustments in the Purchase Price or number or
type of securities or other property which the Holder is entitled to receive
upon exercise of this Warrant shall also apply MUTATIS MUTANDIS to the
Conversion Rights provided for herein.
2. Anti-Dilution Provisions.
------------------------
(a) ADJUSTMENT FOR RECAPITALIZATION. If outstanding shares of the
Company's Common Stock shall be subdivided into a greater number of shares or a
dividend in Common Stock shall be paid in respect of Common Stock, the Purchase
Price in effect immediately prior to such subdivision or at the record date of
such dividend shall simultaneously with the effectiveness of such subdivision or
immediately after the record date of such dividend be proportionately reduced.
If outstanding shares of Common Stock shall be combined into a smaller number
of shares, the Purchase Price in effect immediately prior to such combination
shall, simultaneously with the effectiveness of such combination, be
proportionately increased. When any adjustment is required to be made in the
Purchase Price, the number of shares of Warrant Stock purchasable upon the
exercise of this Warrant shall be changed to the number determined by dividing
(i) an amount equal to the number of shares issuable upon the exercise of this
Warrant immediately prior to such adjustment, multiplied by the Purchase Price
in effect immediately prior to such adjustment, by (ii) the Purchase Price in
effect immediately after such adjustment.
3
<PAGE> 4
(b) ADJUSTMENT FOR REORGANIZATION, CONSOLIDATION, MERGER, ETC.
If there shall occur any capital reorganization or reclassification of the
Company's Common Stock (other than a change in par value or a subdivision or
combination as provided for in subsection 2(a) above), or any consolidation or
merger of the Company with or into another corporation, or a transfer of all or
substantially all of the assets of the Company, then, as part of any such
reorganization, reclassification, consolidation, merger or sale, as the case
may be, lawful provision shall be made so that the Holder of this Warrant shall
have the right thereafter to receive upon the exercise hereof the kind and
amount of shares of stock or other securities or property which such Holder
would have been entitled to receive if, immediately prior to any such
reorganization, reclassification, consolidation, merger or sale, as the case
may be, such Holder had held the number of shares of Common Stock which were
then purchasable upon the exercise of this Warrant. In any such case,
appropriate adjustment (as reasonably determined by the Board of Directors of
the Company) shall be made in the application of the provisions set forth
herein with respect to the rights and interests thereafter of the Holder of this
Warrant such that the provisions set forth in this Section 2 (including
provisions with respect to adjustment of the Purchase Price) shall thereafter
be applicable, as nearly as is reasonably practicable, in relation to any
shares of stock or other securities or property thereafter deliverable upon the
exercise of this Warrant.
(c) ADJUSTMENTS FOR SALE OF SHARES OF COMMON STOCK BELOW PURCHASE PRICE.
(i) SPECIAL DEFINITIONS. For purposes of this Subsection 2(c), the
following definitions shall apply:
(A) "OPTION" shall mean rights, options or warrants to subscribe
for, purchase or otherwise acquire Common Stock or Convertible
Securities (collectively, "Rights"), excluding (1) Rights granted by the
Company prior to the Original Issue Date; (2) up to 20,000 shares of
Class A Common Stock issued upon exercise of options, if any, granted
after the Original Issue Date under the Company's 1986 Non-Qualified
Stock Option Plan and up to 79,000 shares of Class A Common Stock issued
upon exercise of options, if any, granted after the Original Issue Date
under the Company's 1992 Employee Incentive and Non-Qualified Stock
Option Plan and up to 36,000 shares of Class A Common Stock issued upon
exercise of options, if any, granted after the Original Issue Date under
the Company's 1993 Non-Employee Director Stock Option Program; (3) up to
an aggregate of 65,000 shares of Class A Common Stock issued upon
exercise of warrants to purchase such
4
<PAGE> 5
Common Stock, if any, issued, whether before or after the Original Issue
Date, to one or more of Alfred Schechter, Don M. Harwell and Mezzanine
Capital Corporation Limited and warrants to purchase up to an aggregate
of 25,000 shares of Class A Common Stock, if any, issued to The Edgehill
Corporation on or about the Original Issue Date; and (4) Right to
acquire up to 272,267 additional shares of Class A Common Stock.
(B) "ORIGINAL ISSUE DATE" shall mean January 30, 1995.
(C) "CONVERTIBLE SECURITIES" shall mean any evidences of
indebtedness, shares or other securities directly or indirectly
convertible into or exchangeable for Common Stock.
(D) "ADDITIONAL SHARES OF COMMON STOCK" shall mean all shares of
Common Stock issued (or, pursuant to Subsection 2(c)(iii) below, deemed
to be issued) by the Company after the Original Issue Date, other than
shares of Common Stock issued or issuable:
(1) by reason of a dividend, stock split, split-up or other
distribution on shares of Common Stock issued (or pursuant to
Subsection 2(c)(iii) below deemed to be issued) by the Company after
the Original Issue Date; or
(2) pursuant to or upon the exercise of Rights excluded from
the definition of "Option" in Subsection 2(c)(i)(A).
(E) "WARRANT HOLDERS" shall mean the Holder of this Warrant and
the holders of all other Warrants, from time to time, issued in
connection with the sale of the Shares and Warrants pursuant to that
certain Purchase Agreement dated November 29, 1994 by and among the
Company, International Capital Partners, Inc. and the Purchasers defined
therein, as amended (the "Purchase Agreement") and executed and
delivered simultaneously with this Warrant, for so long as such holders
shall hold the Warrants issued pursuant to the Purchase Agreement.
(ii) NO ADJUSTMENT OF PURCHASE PRICE. No adjustment in the number of
shares of Common Stock into which the Warrant is exercisable shall be
made by adjustment in the applicable Purchase Price thereof; (a) unless
the consideration per share (determined
5
<PAGE> 6
pursuant to Subsection 2(c)(v)) for an Additional Share of Common Stock
issued or deemed to be issued by the Company is less than the applicable
Purchase Price in effect on the date of, and immediately prior to, the
issue of such Additional Shares of Common Stock, or (b) if prior to such
issuance, the Company receives written notice from the holders of at
least a majority of the then Warrant Holders agreeing that no such
adjustment shall be made as the result of the issuance of Additional
Shares of Common Stock.
(iii) ISSUE OF SECURITIES DEEMED ISSUE OF ADDITIONAL SHARES OF
COMMON STOCK.
(A) If the Company at any time or from time to time after the
Original Issue Date shall issue any Options or Convertible Securities or
shall fix a record date for the determination of holders of any class of
securities entitled to receive any such Options or Convertible
Securities, then the maximum number of shares of Common Stock (as set
forth in the instrument relating thereto without regard to any provision
contained therein for a subsequent adjustment of such number) issuable
upon the exercise of such Options or, in the case of Convertible
Securities and Options therefor, the conversion or exchange of such
Convertible Securities, shall be deemed to be Additional Shares of
Common Stock issued as of the time of such issue or, in case such a
record date shall have been fixed, as of the close of business on such
record date, provided that Additional Shares of Common Stock shall not
be deemed to have been issued unless the consideration per share
(determined pursuant to Subsection 2(c)(v) hereof) of such Additional
Shares of Common Stock would be less than the applicable Purchase Price
in effect on the date of and immediately prior to such issue, or such
record date, as the case may be.
(B) No further adjustment in the Purchase Price shall be made
upon the subsequent issue of Convertible Securities or shares of Common
Stock upon the exercise of such Options or conversion or exchange of
such Convertible Securities.
(C) If such Options or Convertible Securities by their terms
provide, with the passage of time or otherwise, for any increase in the
consideration payable to the Company, or decrease in the number of
shares of Common Stock issuable, upon the exercise, conversion or
exchange thereof, the Purchase Price computed upon the original issue
thereof (or upon
6
<PAGE> 7
the occurrence of a record date with respect thereto), and any
subsequent adjustments based thereon, shall, upon any such increase or
decrease becoming effective, be recomputed to reflect such increase or
decrease insofar as it affects such Options or the rights of conversion
or exchange under such Convertible Securities.
(D) No readjustment pursuant to clause (C) above shall have the
effect of increasing the Purchase Price to an amount which exceeds the
lower of (1) the Purchase Price on the original adjustment date, or (2)
the Purchase Price that resulted from any other issuance of Additional
Shares of Common Stock between the original adjustment date and such
readjustment date.
(E) Upon the expiration or termination of any unexercised
Option, the Purchase Price shall be readjusted as if the expired or
terminated Options had never been issued, and the Additional Shares of
Common Stock deemed issued as the result of the original issue of such
Option shall not be deemed issued for the purposes of any subsequent
adjustment of the Purchase Price.
(F) In the event of any change in the number of shares of Common
Stock issuable upon the exercise, conversion or exchange of any Option
or Convertible Security, including, but not limited to, a change
resulting from the anti-dilution provisions thereof, the Purchase Price
then in effect shall forthwith be readjusted to such Purchase Price as
would have been obtained had the adjustment which was made upon the
issuance of such Option or Convertible Security not exercised or
converted prior to such change been made upon the basis of such change,
but no further adjustment shall be made for the actual issuance of
Common Stock upon the exercise or conversion of any such Option or
Convertible Security.
(iv) ADJUSTMENT OF PURCHASE PRICE UPON ISSUANCE OF ADDITIONAL
SHARES OF COMMON STOCK. In the event the Company shall at anytime after
the Original Issue Date issue Additional Shares of Common Stock
(including Additional Shares of Common Stock deemed to be issued
pursuant to Subsection 2(c)(iii), but excluding shares issued upon a
stock split or combination or as a dividend or distribution as provided
in Subsection 2(a), without consideration or for a consideration per
share less than the applicable Purchase Price in effect
7
<PAGE> 8
on the date of and immediately prior to such issue, then, and in such
event, such Purchase Price shall be reduced, concurrently with such
issue, to a price (calculated to the nearest cent) determined by
multiplying such Purchase Price by a fraction, (A) the numerator of
which shall be (1) the number of shares of Common Stock outstanding
immediately prior to such issue plus (2) the number of shares of Common
Stock which the aggregate consideration received by the Company for the
total number of Additional Shares of Common Stock so issued would
purchase at such Purchase Price; and (B) the denominator of which shall
be the number of shares of Common Stock outstanding immediately prior to
such issue plus the number of such Additional Shares of Common Stock so
issued; PROVIDED THAT, for the purpose of this Subsection 2(c)(iv), all
shares of Common Stock issuable upon exercise of the Warrants
outstanding immediately prior to such issue shall be deemed to be
outstanding, and immediately after any Additional Shares of Common Stock
are deemed issued pursuant to Subsection 2(c)(iii) (other than shares
excluded from the definition of "Additional Shares of Common Stock"),
such Additional Shares of Common Stock shall be deemed to be
outstanding.
Notwithstanding the foregoing, the applicable Purchase Price
shall not be so reduced at such time if the amount of such reduction
would be an amount less than $.01, but any such amount shall be carried
forward and reduction with respect thereto made at the time of and
together with any subsequent reduction which, together with such amount
and any other amount or amounts so carried forward, shall aggregate $.01
or more.
(v) DETERMINATION OF CONSIDERATION. For purposes of this
Subsection 2(c), the consideration received by the Company for the issue
of any Additional Shares of Common Stock shall be computed as follows:
(A) CASH AND PROPERTY: Such consideration shall:
(1) insofar as it consists of cash, be computed at the
aggregate of cash received by the Company, excluding amounts
paid or payable for accrued interest or accrued dividends;
(2) insofar as it consists of property other than cash,
be computed at the fair market value thereof at the time of such
issue, as
8
<PAGE> 9
determined in good faith by the Board of Directors; and
(3) in the event Additional Shares of Common Stock are
issued together with other shares or securities or other assets
of the Company for consideration which covers both, be the
proportion of such consideration so received, computed as
provided in clauses (1) and (2) above, as determined in good
faith by the Board of Directors.
(B) OPTIONS AND CONVERTIBLE SECURITIES. The consideration per
share received by the Company for Additional Shares of Common Stock
deemed to have been issued pursuant to Subsection 2(c)(iii) relating to
Options and Convertible Securities shall be determined by dividing (x)
the total amount, if any, received or receivable by the Company as
consideration for the issue of such Options or Convertible Securities,
plus the minimum aggregate amount of additional consideration (as set
forth in the instruments relating thereto, without regard to any
provision contained therein for a subsequent adjustment of such
consideration) payable to the Company upon the exercise of such Options
or the conversion or exchange of such Convertible Securities, or in the
case of Options for Common Stock, the exercise of such Options for
Convertible Securities and the conversion or exchange of such
Convertible Securities, by (y) the maximum number of shares of Common
Stock (as set forth in the instruments relating thereto, without regard
to any provision contained therein for a subsequent adjustment of such
number) issuable upon the exercise of such Options or the conversion or
exchange of such Convertible Securities.
(d) CERTIFICATES AS TO ADJUSTMENTS. When any adjustment is required to
be made in the Purchase Price, the Company at its expense shall promptly
compute such adjustment in accordance with the terms of the Warrant and prepare
a certificate executed by two officers of the Company setting forth such
adjustment and showing in detail the facts upon which such adjustment is based.
The Company shall forthwith mail to each Holder a copy of such certificate.
Such certificate shall also set forth the kind and amount of stock or other
securities or property into which this Warrant shall be exercisable following
the occurrence of any of the events specified in this Section 2.
3. FRACTIONAL SHARES. The Company shall not be required upon the
exercise of this Warrant to issue any
9
<PAGE> 10
fractional shares. In lieu of delivering such fractional interest, the Company
shall pay an amount to the Holder equal to the fair market value of such
fractional interest as of the date of exercise.
4. LIMITATION ON SALES, ETC. Each Holder of this Warrant acknowledges
that this Warrant and the Warrant Stock have not been registered under the
Securities Act of 1933, as amended (the "Act"), and agrees not to sell,
pledge, distribute, offer for sale, transfer or otherwise dispose of this
Warrant or any Warrant Stock issued upon its exercise in the absence of (a) an
effective registration statement under the Act as to this Warrant or such
Warrant Stock, or (b) an applicable exemption from such registration under such
Act. Each certificate or other instrument for Warrant Stock issued upon the
exercise of this Warrant shall bear a legend substantially to the foregoing
effect.
Notwithstanding the foregoing, the Holder may require the Company to
issue a certificate representing the Warrant Stock without a legend in
substitution for a legended certificate representing the Warrant Stock if either
(i) such Warrant Stock has been registered for resale under the Act or (ii) such
registration is no longer required under applicable law.
5. NO IMPAIRMENT. The Company will not, by amendment of its Certificate
of Incorporation or through reorganization, consolidation, merger, dissolution,
sale of assets or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order to protect
the rights of the Holder of this Warrant against impairment.
6. LIQUIDATING DIVIDENDS. If the Company pays a dividend or makes a
distribution on the Common Stock payable otherwise than in cash out of earnings
or earned surplus (determined in accordance with generally accepted accounting
principles) except for a stock dividend payable in shares of Common Stock (a
"Liquidating Dividend"), then the Company will pay or distribute to the Holder
of this Warrant, upon the exercise hereof, in addition to the Warrant Stock
purchased upon such exercise, the Liquidating Dividend which would have been
paid to such Holder if he, she or it had been the owner of record of such shares
of Warrant Stock immediately prior to the date on which a record is taken for
such Liquidating Dividend or, if no record is taken, the date as of which the
record holders of Common Stock entitled to such dividends or distribution are to
be determined.
10
<PAGE> 11
7. NOTICES OF RECORD DATE, ETC. In case:
(a) the Company shall choose a date on which a record is to be taken of
the holders of its Common Stock (or other stock or securities at the time
deliverable upon the exercise of this Warrant) for the purpose of entitling or
enabling them to receive any dividend or other distribution, or to receive any
right to subscribe for or purchase any shares of stock of any class or any other
securities, or to receive any other right, or
(b) of any capital reorganization of the Company, any reclassification
of the capital stock of the Company, any consolidation or merger of the Company
with or into another corporation (other than a consolidation or merger in which
the Company is the surviving entity), or any transfer of all or substantially
all of the assets of the Company, or
(c) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company, then, and in each such case, the Company will mail or
cause to be mailed to the Holder of this Warrant a notice specifying, as the
case may be, (i) the date on which a record is to be taken for the purpose of
such dividend, distribution or right, and stating the amount and character of
such dividend, distribution or right, or (ii) the effective date on which such
reorganization, reclassification, consolidation, merger, transfer, dissolution,
liquidation or winding-up is to take place, and the time, if any is to be fixed,
as of which the holders of record of Common Stock (or such other stock or
securities at the time deliverable upon the exercise of this Warrant) shall be
entitled to exchange their shares of Common Stock (or such other stock or
securities) for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, transfer dissolution,
liquidation or winding-up. Such notice shall be mailed at least ten (10) days
prior to the record date or effective date for the event specified in such
notice.
8. RESERVATION OF STOCK. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the exercise of this Warrant,
such shares of Warrant Stock and other stock, securities and property, as from
time to time shall be issuable upon the exercise of this Warrant. All such
shares shall be duly authorized and, when issued upon such exercise, shall be
validly issued, fully paid and nonassessable, free and clear of all liens,
security interests, charges and other encumbrances or restrictions on sale
(other than any restrictions on transfer which may arise under any applicable
federal or state securities laws) and free and clear of all preemptive rights.
11
<PAGE> 12
9. EXCHANGE OF WARRANTS. Upon the surrender by the Holder of any Warrant
or Warrants, properly endorsed, to the Company at the principal office of the
Company, the Company will, subject to the provisions of Section 4 hereof, issue
and deliver to or upon the order of such Holder, at the Company's expense, a new
Warrant or Warrants of like tenor, in the name of such Holder or as such Holder
(upon payment by such Holder of any applicable transfer taxes) may direct,
calling in the aggregate on the face or faces thereof for the number of shares
of Common Stock called for on the face or faces of the Warrant or Warrants so
surrendered.
10. REPLACEMENT OF WARRANTS. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement in an amount reasonably satisfactory to the Company, or (in
the case of mutilation) upon surrender and cancellation of this Warrant, the
Company at its expense (other than with respect to any legal fees incurred by
the Holder which shall be at the Holder's expense) will issue, in lieu thereof,
a new Warrant of like tenor.
11. TRANSFERS, ETC.
(a) The Company will maintain a register containing the names and
addresses of the registered Holders of this Warrant. Any Holder may change its,
his or her address as shown on the warrant register by written notice to the
Company requesting such change.
(b) Subject to the provisions of Section 4 hereof, this Warrant and all
rights hereunder are transferable, in whole or in part, upon surrender of this
Warrant with a properly executed assignment (in this form of EXHIBIT 3 hereto)
at the principal office of the Company.
(c) Until any transfer of this Warrant is made in the warrant register,
the Company may treat the registered Holder of this Warrant as the absolute
owner hereof for all purposes; provided, however, that if and when this Warrant
is properly assigned in blank, the Company may (but shall not be obligated to)
treat the bearer hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary.
12. MAILING OF NOTICES, ETC. all notices and other communications from
the Company to the Holder of this Warrant shall be mailed by first-class
certified or registered mail, postage prepaid, to the address furnished to the
Company in writing by the last registered Holder of this Warrant who shall have
furnished an address to the Company in writing. All notices
12
<PAGE> 13
and other communications from the Holder of this Warrant or in connection
herewith to the Company shall be mailed by first-class certified or registered
mail, postage prepaid, to the Company at its principal office set forth below.
If the Company should at any time change the location of its principal office
to a place other than as set forth below, it shall give prompt written notice
to the registered Holder of this Warrant and thereafter all references in this
Warrant to the location of its principal office at the particular time shall be
as so specified in such notice.
13. NO RIGHTS AS STOCKHOLDER. Until the exercise of this Warrant, the
Holder of this Warrant shall not have or exercise any rights by virtue hereof
as a stockholder of the Company.
14. CHANGE OR WAIVER. Any term of this Warrant may be changed or waived
only by an instrument in writing signed by the party against which enforcement
of the change or waiver is sought.
15. HEADINGS. The headings in this Warrant are for purposes of
reference only and shall not limit or otherwise affect the meaning of any
provision of this Warrant.
16. GOVERNING LAW. This Warrant will be governed by and construed in
accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed and issued by its officers thereunto duly authorized as of this 30th
day of January, 1995.
[Corporate Seal] CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
-------------------------
Name:
Title:
3811 Joliet Street
Denver, Colorado 80239
ATTEST:
/s/ R. A. Murray
- ------------------
13
<PAGE> 14
EXHIBIT 1
PURCHASE FORM
-------------
To: Dated:
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. __), hereby irrevocably elects to purchase _______ shares of the
Class A Common Stock covered by such Warrant and herewith makes payment of
$________, representing the full purchase price for such shares at the price per
share provided for in such Warrant.
Signature ____________________________
Address: _____________________________
EXHIBIT 2
CONVERSION FORM
---------------
To: Dated:
The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. __), hereby irrevocably elects to convert _______ shares subject
to this Warrant into _________ shares of the Class A Common Stock as provided
for in such Warrant.
If fewer than all of the shares subject to this Warrant are being
converted hereby, please return to the undersigned a new Warrant for the
remaining shares as provided in the Warrant.
Signature ____________________________
Address: _____________________________
14
<PAGE> 15
EXHIBIT 3
ASSIGNMENT FORM
---------------
FOR VALUE RECEIVED, ___________________________________ hereby sells,
assigns and transfers all of the rights of the undersigned under the attached
Warrant (No. __) with respect to the number of shares of Class A Common Stock
covered thereby set forth below, unto:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
- ---------------- ------- -------------
15
<PAGE> 16
CRYENCO SCIENCES, INC.
3811 Joliet Street
Denver, Colorado 80239
June 8, 1995
International Capital Partners, Inc.
300 First Stamford Place
Stamford, CT 06902
Attn: Ajit G. Hutheesing, Chairman
Ladies and Gentlemen:
Reference is made to the Letter Agreement dated May 18, 1995 (the
"Letter Agreement") among Cryenco Sciences, Inc., a Delaware corporation (the
"Corporation"), International Capital Partners, Inc. ("ICP") and the Purchasers
listed on Schedule I thereto. Terms used herein and not otherwise defined shall
have the meanings attributed thereto in the Letter Agreement.
This letter will serve to confirm that pursuant to Paragraph 1 of the
Letter Agreement, effective June 8, 1995 the initial Purchase Price with
respect to Warrant No. ICP-94-30 and Warrant No. ICP-95-31 issued by the
Corporation to ICP on December 20, 1994 and January 30, 1995, respectively,
shall be $3.00 per share. Please annex a copy of this letter to Warrant No.
ICP-94-30 and No. ICP-95-31 as evidence of the reduction of the Purchase Price.
Very truly yours,
CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
-------------------------
Name: Alfred Schechter
Title: President
<PAGE> 1
Exhibit 4.20
AMENDMENT NO. 1 TO WARRANT AGREEMENT
This Amendment No. 1 to Warrant Agreement is made as of this 31st day of
July, 1997, by and between International Capital Partners, Inc. (the "Holder"),
Cryenco Sciences, Inc., a Delaware corporation (f/k/a Cryenco Holdings, Inc.)
("Cryenco") and Chart Industries, Inc., a Delaware corporation ("Chart").
WHEREAS, the Holder and Cryenco, among others, are parties to a warrant
agreement or agreements (the "Warrant Agreement") dated as of December 20, 1994,
pursuant to which Cryenco granted the Holder a warrant or warrants (the "Cryenco
Warrant") to purchase an aggregate of 160,000 shares of Cryenco Class A common
stock, par value $.01 per share (the "Cryenco Common Stock");
WHEREAS, Cryenco and Chart entered into a Plan and Agreement of Merger
dated as of April 30, 1997 (the "Merger Agreement") providing for the merger of
an affiliate of Chart into Cryenco (the "Merger") and the conversion of all
issued and outstanding Cryenco Common Stock (other than dissenters' shares) into
cash in the amount of $2.75 per share;
WHEREAS, in Section 5.4(b)(iii) of the Merger Agreement, Chart has agreed
to offer to grant a substitute warrant (the "Chart Warrant") to purchase shares
of Chart's common stock, par value $.01 per share (the "Chart Common Stock), in
exchange for the Cryenco Warrant; and
WHEREAS, the Holder, Cryenco and Chart now desire that, in satisfaction of
Chart's obligations under Section 5.4(b)(iii) of the Merger Agreement, the
Cryenco Warrant be amended to provide the Holder with the right to purchase
Chart Common Stock in substitution for the right to purchase Cryenco Common
Stock;
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements and undertakings set forth herein, the parties hereby agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall
have the meaning ascribed to them in the Merger Agreement.
2. AMENDMENT. As of the effective time of the Merger (the "Effective
Time"), the Warrant Agreement and the form of Cryenco Warrant referenced therein
are hereby amended as follows:
(a) CHART COMMON STOCK SUBSTITUTED FOR CRYENCO COMMON STOCK. All
references to the right of the Holder to purchase shares of
Cryenco Common Stock shall be deleted and the right to
purchase shares of Chart Common Stock shall be substituted
therefor.
<PAGE> 2
(b) ADJUSTMENT TO NUMBER OF SHARES UNDERLYING WARRANT. The number
of shares of Chart Common Stock issuable upon exercise of the
warrant shall be the product of (i) the number of shares of
Cryenco Common Stock that were issuable upon exercise of the
Cryenco Warrant times (ii) a fraction (the "Exchange Ratio")
the numerator of which shall be $2.75 and the denominator of
which shall be the average of the closing sales price of Chart
Common Stock on the New York Stock Exchange as reported by the
Wall Street Journal for the ten trading days preceding the
Effective Time; provided, however, that in no event shall the
Exchange Ratio be less than .165 nor more than .206.
(c) ADJUSTMENT TO PURCHASE OR EXERCISE PRICE. The purchase or
exercise price per share of Chart Common Stock subject to the
Chart Warrant shall be equal to (i) the purchase or exercise
price per share of Cryenco Common Stock divided by (ii) the
Exchange Ratio.
(d) NOTICES. Any notices, requests, forms, certificates or other
documents or communications deliverable to Cryenco under the
Warrant Agreement shall be required to be delivered instead to
Chart at 35555 Curtis Boulevard, Eastlake, OH 44095, to the
attention of the Chief Financial Officer, with a copy to
Calfee, Halter & Griswold LLP, 1400 McDonald Investment
Center, 800 Superior Avenue, Cleveland, OH 44114, Attention:
Thomas F. McKee.
(e) SUBMISSION TO JURISDICTION. Any provision in the Warrant
Agreement requiring that any action, claim or proceeding
arising out of, or relating in any way to, the Warrant
Agreement be brought exclusively in a jurisdiction located in
the State of Colorado shall be deleted in its entirety.
(f) SUBSTITUTION OF WARRANTS. Chart and the Holder agree that any
and all Warrants and/or Warrant Certificates issued pursuant
to the Warrant Agreement shall be amended in a manner
consistent with the provisions of this Amendment No.1 and
that, upon the Holder's presentation to Chart of such Warrants
or Warrant Certificates, Chart shall deliver to the Holder, in
exchange and substitution therefor, new Warrant or Warrant
Certificates.
3. FULL COMPLIANCE; ASSUMPTION OF CRYENCO'S OBLIGATIONS; REFERENCES TO
CRYENCO. The Holder acknowledges and agrees that, as of the Effective Time,
Cryenco is in full compliance with all of its obligations under the Warrant
Agreement, the Cryenco Warrant and any related agreements pertaining to
registration rights of the Holder with respect to the shares of Cryenco Common
Stock issuable upon exercise of the Warrants. As of the Effective Time, Chart
assumes all of the obligations of Cryenco under the Warrant Agreement as amended
hereby, and all references to Cryenco in the Warrant Agreement shall be deemed
to be
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<PAGE> 3
references to Chart. To the extent that Holder is party to a separate
registration rights agreement relating to Cryenco Common Stock, promptly after
the Effective Time, Chart and the Holder shall enter into such supplemental
agreement as may be necessary to provide the Holder with equivalent registration
rights relating to Chart Common Stock issuable upon exercise of the Chart
Warrant.
4. RECEIPT OF CHART DISCLOSURES. The Holder acknowledges that it has
received copies of Chart's 1996 Form 10-K Report and Chart's Form 1O-Q Report
for the three-month period ended March 31, 1997.
5. NO RIGHT TO PURCHASE CRYENCO COMMON STOCK. At and after the Effective
Time, the Holder shall be deemed to have surrendered any and all rights under
the Warrant Agreement and Warrant to purchase Cryenco Common Stock.
6. CONSENT TO AMENDMENT. By the execution and delivery of this Amendment
No. 1, the Holder shall be deemed to have consented to the terms hereof in
accordance with the terms of the Warrant Agreement.
7. NO OTHER AMENDMENTS. Except as specifically provided herein or as
otherwise necessary or appropriate to effectuate the intent of this Amendment
No. 1, the provisions of the Cryenco Warrant shall remain in full force and
effect without any alteration or modification thereto. Without limiting the
generality of the foregoing, the date of grant and the date of termination of
the Cryenco Warrant shall continue to be such dates as were in effect
immediately prior to the Effective Time.
8. SUCCESSORS AND ASSIGNS. This Agreement and all of the provisions
hereof shall be binding on and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
9. GOVERNING LAW. This Amendment No.1 shall be, and the Warrant Agreement
shall be amended to provide that it shall be, governed by and construed in
accordance with, the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
10. SEVERABILITY. If any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held to be invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
11. COUNTERPARTS. This Amendment No. 1 may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same instrument.
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<PAGE> 4
IN WITNESS WHEREOF, the parties have executed this Amendment No.1 as of
the date first written above.
CHART INDUSTRIES, INC.
Attest: /s/ Suzanne Lines /s/ Don A. Baines
-------------------------- ---------------------------
By: Don A. Baines
Title: CFO & Treasurer
INTERNATIONAL CAPITAL PARTNERS, INC.
Attest: /s/ ???? /s/ ??????
-------------------------- ---------------------------
By: ???
Title: Chairman
CRYENCO SCIENCES, INC.
Attest: /s/ Steve M. Lutt /s/ James A. Raabe
-------------------------- ---------------------------
By: James A. Raabe
Title: VP & CFO
-4-
<PAGE> 1
Exhibit 4.21
WARRANT AGREEMENT dated as of March 12, 1993 between CRYENCO SCIENCES,
INC., a Delaware corporation (the "Company"), and MEZZANINE CAPITAL CORPORATION
LIMITED (the "Holder").
1. GRANT. Subject to the terms of this Agreement, in consideration of $10
and other good and valuable consideration the receipt and sufficiency of which
is hereby acknowledged by the Company, the Holder is hereby initially granted
the right to purchase, at any time and from time to time from March 12, 1993
until 5:30 p.m., Denver time, on March 11, 1998 (the "Exercise Period"), up to
an aggregate of 30,000 shares of Common Stock at an initial exercise price of
$7.90. The adjusted exercise price shall be the price which shall result from
time to time from any and all adjustments of the initial exercise price in
accordance with the provisions of SECTION 6 hereof. The term "Exercise Price"
herein shall mean the initial exercise price or the adjusted exercise price,
depending upon the context.
2. WARRANT CERTIFICATES. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall be
in the form set forth in Exhibit A, attached hereto and made a part hereof, with
such appropriate insertions, omissions, substitutions and other variations as
required or permitted by this Agreement.
3. EXERCISE OF WARRANTS. The Warrants initially are exercisable at the
Exercise Price (subject to adjustment as provided in SECTION 6 hereof) per share
of Common Stock, payable by certified or official bank cashier's check payable
to the order of the Company; PROVIDED, HOWEVER, that the Holder shall have the
right, at his or its election, in lieu of delivering the Exercise Price in cash,
to instruct the Company in the form of subscription to retain, in payment of the
Exercise Price, a number of shares of Common Stock (the "Payment Shares") equal
to the quotient of (i) the Exercise Price multiplied by the number of shares as
to which the Warrant is then being exercised divided by (ii) the "Average
Closing Price" as of the date of exercise and to deduct the number of Payment
Shares from the shares to be delivered to the Holder. "Average Closing Price"
means, as of any date, (x) if shares of Common Stock are listed on a national
securities exchange, the average of the closing sales prices therefor on the
largest securities exchange on which such shares are traded on the last ten (10)
trading days before such date, (y) if such shares are listed on the NASDAQ
National Market System but not on any national securities exchange, the average
of the closing sales prices therefor on the NASDAQ National Market System on the
last ten (10) trading days before the date of exercise of the Warrants or (z) if
such shares are not listed on either a national securities exchange or the
NASDAQ National Market System, the average of the sales prices therefor on the
last twenty (20) trading days before the date of exercise of the Warrants. Upon
surrender of a Warrant
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<PAGE> 2
Certificate with the annexed Form of Election to Purchase duly executed,
together with payment of the Exercise Price for the shares of Common Stock at
the Company's principal offices (currently located at 5995 North Washington
Street, Denver, Colorado 80216), the Holder or any subsequent registered holder
or holders of a Warrant Certificate (any such subsequent holder or holders also
reference to herein as the "Holder" or "Holders") shall be entitled to receive a
certificate or certificates for the shares of Common Stock so purchased for the
Warrants so exercised. The purchase rights represented by each Warrant
Certificate are exercisable at the option of the Holder thereof, in whole or in
part (but not as to fractional shares of the Common Stock underlying the
Warrants). Warrants may be exercised to purchase all or part of the shares of
Common Stock represented thereby. In the case of the purchase of less than all
the securities purchasable under any Warrant Certificate, the Company shall
cancel said Warrant Certificate upon the surrender thereof and, unless the
Warrant has expired, shall execute and deliver a new Warrant Certificate of like
tenor for the balance of the securities purchasable thereunder. With respect to
any such exercise, the Holder shall for all purposes be deemed to have become
the holder of record of the number of shares of Common Stock evidenced by such
certificate or certificates from the date on which the Warrant was surrendered
and payment of the Exercise Price was made irrespective of the date of delivery
of such certificate, except that, if the date of such surrender and payment is a
date on which the stock transfer books of the Company are closed, such person
shall be deemed to have become the holder of such shares at the close of
business on the next succeeding date on which the stock transfer books are open.
4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the
issuance of certificates for the shares of Common Stock shall be made forthwith
(and in any event within ten (10) business days thereafter) without charge to
the Holder thereof including, without limitation, any tax which may be payable
in respect of the issuance thereof, and such certificates shall (subject to the
provisions of SECTIONS 5 and 7 hereof) be issued in the name of, or in such
names as may be directed by, the Holder thereof; provided, however, that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any such certificates in a
name other than that of the Holder, and the Company shall not be required to
issue or deliver such certificates unless or until the person or persons
requesting the issuance thereof in a name other than that of the Holder 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.
The Warrant Certificates and the certificates representing the shares of
Common Stock shall be executed on
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<PAGE> 3
behalf of the Company by the manual or facsimile signature of the then present
Chairman or Vice Chairman of the Board of Directors or President or Vice
President of the Company under its corporate seal reproduced thereon, attested
to by the dual or facsimile signature of the then present Secretary or Assistant
Secretary of the Company. Warrant Certificates shall be dated the date of
execution by the Company upon initial issuance, division, exchange, substitution
or transfer.
5. RESTRICTION ON TRANSFER OF WARRANTS. There shall be not more than
five (5) Holders of record of Warrants. The Holder of a Warrant Certificate,
by its acceptance thereof, covenants and agrees that the Warrants may not be
sold, transferred, assigned, hypothecated or otherwise disposed of, in whole
or in part, except to or among wholly-owned subsidiaries of the Holder or
officers, directors or employees of the Holder or any successor to the
business of the Holder, who also shall hold the Warrants subject to the
restrictions contained in this SECTION 5. Certificates representing the
Warrants shall bear a legend setting forth the foregoing restriction.
6. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES.
6.1 COMPUTATION OF ADJUSTED EXERCISE PRICE. For the purposes of this
SECTION 6, the term Exercise Price shall mean the Exercise Price per share of
Common Stock set forth in SECTION 1 hereof, as adjusted from time to time
pursuant to the provisions of this SECTION 6.
6.2 EXERCISE PRICE ADJUSTMENTS. In case at the time of any advance under
the Funding Agreement dated as of March 12, 1993 (the "Funding Agreement"),
the average closing price of the Common Stock in the NASDAQ National Market
System on the ten (10) trading days immediately preceding such advance is less
than the Exercise Price, the Exercise Price shall be reduced and be equal to
such average closing price of the Common Stock on the ten (10) trading days
immediately preceding such subsequent advance.
6.3 SUBDIVISION AND COMBINATIONS. In case the Company shall at any time
subdivide (for example, a stock split or stock dividend) or combine (for
example, a reverse stock split) the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
6.4 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this SECTION 6, the number of
securities issuable upon the exercise of each Warrant shall be adjusted to the
nearest full amount by multiplying a number equal to the Exercise Price in
effect immediately prior to such adjustment by the number of
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<PAGE> 4
shares of Common Stock (or other securities as provided in Section 5 hereof)
issuable upon exercise of the Warrants immediately prior to such adjustment
and dividing the product so obtained by the adjusted Exercise Price.
6.5 DEFINITION OF COMMON STOCK. For the purpose of this Agreement, the
term "Common Stock" shall mean (i) the class of stock designated as Class A
voting Common Stock, $.01 par value, in the Amended and Restated Certificate
of Incorporation of the Company as of the date hereof, (ii) the class of stock
designated as Class B non-voting Convertible Common Stock, $.01 par value, in
the Amended and Restated Certificate of Incorporation of the Company as of the
date hereof, (iii) any other capital stock of any class or classes (however
designated) of the Company the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of current
dividends and liquidating dividends after the payment of dividends and
distributions on any shares entitled to preference and (iv) any other
securities into which or for which any of the securities described in clauses
(i), (ii) or (iii) above have been converted, exchanged or combined pursuant
to a plan of recapitalization, reorganization, merger, sale of assets or
otherwise. In the event that the Company shall after the date hereof issue
securities with greater or superior voting rights than the shares of Common
Stock outstanding as of the date hereof, the Holder, at his or its option, may
receive upon exercise of any Warrant either shares of Common Stock or an equal
number of such securities with greater or superior voting rights.
6.6 MERGER OR CONSOLIDATION. If any capital reorganization or
reclassification of the capital stock of the Company or any consolidation,
merger or other transaction of the Company with another corporation in which
the Company is the surviving corporation, or the sale of all or substantially
all of the Company's assets to another corporation shall be effected in such a
way that holders of Common Stock shall be entitled to receive consideration
(including but not limited to stock, securities or assets) with respect to or
in exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate
provisions shall be made whereby each Holder shall thereafter have the right
to receive upon the basis and upon the terms and conditions specified herein
and in lieu of the shares of Common Stock of the Company immediately
theretofore so receivable upon the exercise of each Warrant or Warrants, such
shares of stock, securities or assets (including cash) as may be issued or
payable with respect to or in exchange for a number of outstanding shares of
such Common Stock equal to the number of shares of such stock immediately
theretofore so receivable had such reorganization, reclassification,
consolidation, merger or sale not taken place, and in any such case
appropriate provision shall be made with respect to the rights and interests
of such
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<PAGE> 5
holder to the end that the provisions hereof (including, without limitation,
provisions for adjustments of the Exercise Price) shall thereafter be
applicable, as nearly as may be, in relation to any shares of stock,
securities or assets thereafter deliverable upon the exercise of such exercise
rights. In the event of a merger or consolidation of the Company or other
transaction in which the Company is not the surviving corporation or in which,
as the result of the transaction, no trading market will exist for the Common
Stock, the Company shall give notice regarding the transaction in accordance
with SECTION 12 as soon as practicable (and in no event less than twenty (20)
days prior to the record date fixed for the transaction or, if none, the
closing date for such transaction) in order to afford the Holders the
opportunity to exercise their Warrants and receive after exercise the same
consideration as is payable in the transaction to other holders of Common
Stock. This Section 6.6 shall similarly apply to successive reorganizations,
classifications, consolidations, mergers or other transactions contemplated
hereby.
6.7 NOTICE OF ADJUSTMENT. Upon any adjustment of the Exercise Price, the
Company shall give written notice thereof to each Holder in accordance with
Section 12, which notice shall state the Exercise Price resulting from such
adjustment, setting forth in reasonable detail the method of calculation and
the facts upon which such calculation is based.
7. REGISTRATION RIGHTS.
7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. The Warrants and the
shares of Common Stock have not been registered for sale under the Act. Upon
exercise of the Warrants, in part or in whole, certificates representing the
shares of Common Stock shall bear the following legend:
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended ("Act"), and may not be
offered or sold except pursuant to (i) an effective registration
statement under the Act, (ii) to the extent applicable, Rule 144 under
the Act (or any similar rule under such Act relating to the disposition
of securities), or (iii) an opinion of counsel, if such opinion shall be
reasonably satisfactory to counsel to the issuer that an exemption from
registration under such Act is available.
7.2 PIGGYBACK REGISTRATION. (a) If, at any time commencing after the
date hereof through and including the fifth anniversary hereof the Company
proposes to register any of its securities under the Act (other than in
connection with a transaction contemplated by Rule 145(a) promulgated under
the Act or pursuant to Form S-8) it will give written notice by
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<PAGE> 6
registered or certified mail, at least fifteen (15) days prior to the filing
of each such registration statement, to the Holders of the Warrants of its
intention to do so. If the Holders of the Warrants notify the Company within
fifteen (15) days after receipt of any such notice of its or their desire to
include Common Stock underlying the Warrants in such proposed registration
statement, the Company shall afford the such Holders of the opportunity to
have any such Common Stock registered under such registration statement.
(b) In the case of an underwritten offering, if the managing underwriter
of the offering determines and advises the Company in writing that inclusion
of the Common Stock of the Holders requested to be included would interfere
with the successful offering of shares by the Company there shall be excluded
from such offering, to the extent that the managing underwriter deems
necessary, shares of Common Stock owned by the Holders on a PRO RATA basis.
7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In connection
with any registration under Section 7.2 hereof, the Company covenants and
agrees as follows:
(a) The Company shall pay all costs (excluding transfer taxes, if any,
and fees and expenses of Holder(s)' counsel and any underwriting or selling
commissions), fees and expenses in connection with all registration statements
filed pursuant to SECTION 7.2 hereof including, without limitation, the
Company's legal and accounting fees (including the costs and expenses of any
special audit or other procedures), printing expenses, blue sky fees and
expenses.
(b) The Company will take all necessary action which may be required in
qualifying or registering the Common Stock included in a registration
statement for offering and sale under the securities or blue sky laws of such
states as reasonably are requested by the Holder(s) provided, however, that
the number of states in which qualification or registration shall be required
shall not exceed five (5) and in no event shall the Company be required to
effect such qualification or registration if such act would require the
Company to qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction where it is not now so qualified or
required to file such a consent.
(c) Upon any registration becoming effective pursuant to this SECTION 7,
the Company shall use its best efforts to: (i) keep such registration
statement current for a period of ninety (90) days; (ii) prepare and file with
the Commission such amendments and supplements to such registration statement
as may be necessary to comply with the provisions of the Act and the
Regulations of the Commission with respect to the disposition of all
securities covered by such registration
-7-
<PAGE> 7
statement; (iii) cause all the Common Stock registered pursuant to such
registration statement to be listed on each exchange or automated quotation
system on which the Common Stock is then listed; (iv) provide a transfer agent
and registrar for all stock registered pursuant to such registration statement
and CUSIP number for all such stock, in each case not later than the effective
date of such registration; and (v) otherwise use its best efforts to comply
with all applicable rules and regulations of the Commission.
(d) The Company shall indemnify and hold harmless the Holder(s) of the
Common Stock to be sold pursuant to any registration statement and each
person, if any, who controls such Holders within the meaning of Section 15 of
the Act or Section 20(a) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), against and from all loss, claim, damage, expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which any of them may
become subject under the Act, the Exchange Act or otherwise, arising from such
registration statement.
(e) The Holders of the Common Stock to be sold pursuant to a
registration statement, and its or their successors and assigns, shall
indemnify and hold harmless the Company, its officers and directors and each
person, if any, who controls the Company within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act, against and from all loss,
claim, damage, expense or liability (including all expenses reasonably
incurred in investigating, preparing or defending against any claim
whatsoever) to which they may become subject under the Act, the Exchange Act
or otherwise, arising from information furnished by or on behalf of such
Holders or its or their successors or assigns, for specific inclusion in such
registration statement.
(f) Any person entitled to indemnification under this SECTION 7 will (i)
give prompt written notice to the indemnifying party of any claim with respect
to which it seeks indemnification 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 will not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent will not
be unreasonably withheld). An indemnifying party who is not entitled to, or
elects not to, assume the defense of a claim will 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
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<PAGE> 8
interest may exist between such indemnified party and any other of such
indemnified parties with respect to such claim.
(g) Nothing contained in this Agreement shall be construed as requiring
the Holder to exercise his or its Warrants prior to the initial filing of any
registration statement or the effectiveness thereof.
(h) The Company at its expense shall deliver promptly to each Holder
participating in the offering and requesting the correspondence and memoranda
described below copies of all documents proposed to be filed with the
Commission, all correspondence between the Commission and the Company, its
counsel or auditors, and all memoranda relating to discussions with the
Commission or its staff with respect to the registration statement and permit
each such Holder at its expense to do such investigation, upon reasonable
advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary to comply with
applicable securities laws or rules of the National Association of Securities
Dealers, Inc. ("NASD"). Such investigation shall include access to books,
records and properties and opportunities to discuss the business of the
Company with its officers and independent auditors, all to such reasonable
extent and at such reasonable times and as often as any such Holder shall
reasonably request.
8. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of securities in such denominations as shall
be designated by the Holder thereof at the time of such surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation of any Warrant Certificate, and, in
case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable
expenses incidental thereto, and upon surrender and cancellation of the
Warrant Certificate, if mutilated, the Company will make and deliver a new
Warrant Certificate of like tenor, in lieu thereof.
9. ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be
required to issue certificates representing fractions of shares of Common
Stock upon the exercise of the Warrants, nor shall it be required to issue
scrip or pay cash in lieu of fractional interests, it being the intent of the
parties that all fractional interests shall be eliminated by rounding any
fraction up to the nearest whole number of shares of Common Stock or other
securities, properties or rights.
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<PAGE> 9
10. RESERVATION AND LISTING. The Company shall at times have and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon the exercise of the Warrants, such number of shares of Common
Stock or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants, and payment of the respective exercise price therefor, all shares of
Common Stock and other securities issuable upon such exercise shall, at the
time of delivery thereof, be duly and validly issued, fully paid,
nonassessable, not subject to the preemptive rights of any stockholder and
free from all taxes, liens and charges with respect to the issue thereof. The
Company will take all such action as may be necessary to ensure that all such
shares of Common Stock may be so issued without violation of any applicable
law or regulation, or of any requirements of any national securities exchange
upon which the Common Stock of the Company may be listed. The Company will not
take any action which results in any adjustment of the Exercise Price if the
total number of shares of Common Stock issued and issuable after such action
upon exercise of the Warrants would exceed the total number of shares of
Common Stock then authorized by the Company's Amended and Restated Certificate
of Incorporation. The Company has not granted and will not grant any right of
first refusal with respect to shares issuable upon exercise of the Warrants,
and there are no preemptive rights associated with such shares. As long as the
Warrants shall be outstanding, the Company shall use its best efforts to cause
all shares of Common Stock issuable upon the exercise of the Warrants to be
listed (subject to official notice of issuance) on all securities exchanges,
if any, on which the Common Stock issued to the public in connection herewith
may then be listed and/or quoted on NASDAQ.
11. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement
shall be construed as conferring upon the Holders the right to vote or to
consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having
any rights whatsoever as a stockholder of the Company. If, however, at any
time prior to the expiration of the Warrants and their exercise, any of the
following events shall occur:
(a) the Company shall take a record of the holders of its shares
of Common Stock for the purpose of entitling them to receive a dividend
or distribution payable otherwise than in cash, or a cash dividend or
distribution payable otherwise than out of current or retained earnings,
as indicated by the accounting treatment of such dividend or
distribution on the books of the Company; or
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<PAGE> 10
(b) the Company shall offer to all the holders of its Common Stock
any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capita 1 stock of the
Company, or any option, right or warrant to subscribe therefor; or
(c) a dissolution, liquidation or winding up of the Company (other
than in connection with a consolidation or merger) or a sale of all or
substantially all of its property, assets and business as an entity
shall be proposed
then, in any one or more of said events, the Company shall give written notice
of such event at least fifteen (15) days prior to the date fixed as a record
date or the date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution, convertible or
exchangeable securities or subscription rights, or entitled to vote on such
proposed dissolution, liquidation, winding up or sale. Such notice shall
specify such record date or the date of closing the transfer books, as the
case may be. Failure to give such notice or any defect therein shall not
affect the validity of any action taken in connection with the declaration or
payment of any such dividend, or the issuance of any convertible or
exchangeable securities, or subscription rights, options or warrants, or any
proposed dissolution, liquidation, winding up or sale.
12. NOTICES.
All notices, requests, consents and other communications hereunder shall
be in writing and shall be deemed to have been duly made when delivered, or
mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of the Warrants, to the address of
such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in SECTION 3
hereof or to such other address as the Company may designate by notice
to the Holders.
13. SUPPLEMENTS AND AMENDMENTS. The Company and the Holder may from time
to time supplement or amend this Agreement without the approval of any
subsequent Holders of Warrant Certificates (other than the Holder) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with provisions herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which the Company
and the Holder
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<PAGE> 11
deem shall not adversely affect the interests of the Holders of Warrant
Certificates.
14. SUCCESSORS. All the covenants and provisions of this Agreement shall
be binding upon and inure to the benefit the Company, the Holders and their
respective successors assigns hereunder.
15. This Agreement shall terminate at the close of business on March 11,
1998. Notwithstanding the foregoing, the indemnification provisions of Section
7 shall survive such termination until the close of business on March 11,
2001.
16. GOVERNING LAW: SUBMISSION TO JURISDICTION. This Agreement and each
Warrant Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be
construed in accordance with the laws of said State without giving effect to
the rules of said State governing the conflicts of laws.
The Company, the representative and the Holders hereby agree that any
action, proceeding or claim against it arising out of, or relating in any way
to, this Agreement shall be brought and enforced in the courts of the state of
New York or of the United States of America for the Southern District of New
York, and irrevocably submits to such jurisdiction, which jurisdiction shall
be exclusive. The Company, the Representative and the Holders hereby
irrevocably waive any objection to such exclusive jurisdiction or inconvenient
forum. Any such process or summons to be served upon any of the Company, the
representative and the Holders (at the option of the party bringing such
action, proceeding or claim) may be served by transmitting a copy thereof, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in SECTION 12 hereof. Such mailing
shall be deemed personal service and shall be legal and binding upon the party
so served in any action, proceeding or claim.
17. ENTIRE AGREEMENT: MODIFICATION. This Agreement (including the
Funding Agreement to the extent portions thereof are referred to herein)
contain the entire understanding between the parties hereto with respect to
the subject matter hereof and may not be modified or amended except by a
writing duly signed by the party against whom enforcement of the modification
or amendment is sought.
18. SEVERABILITY. If any provision of this amendment shall be held to be
invalid or unenforceable, such invalidity or unenforceability shall not affect
any other provision of this Agreement.
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<PAGE> 12
19. CAPTIONS. the caption headings of the sections of this Agreement are
for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive
effect.
20. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Holder and any subsequent registered Holder(s) of the Warrant Certificates or
Warrants any legal or equitable right, remedy or claim under this Agreement;
and this Agreement shall be for the sole and exclusive benefit of the Company
and the Holder and subsequent Holder(s) of the Warrant Certificates or
Warrants.
21. COUNTERPARTS. This Agreement may be executed any in number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and
the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
CRYENCO SCIENCES, INC.
By: /s/ Don M. Harwell
----------------------------
Name: Don M. Harwell
Title: Vice President
Attest:
/s/ Alison A. Murray
- ------------------------
Name: Alison A. Murray
Title: Secretary
MEZZANINE CAPITAL CORPORATION
LIMITED
By: /s/ Jerome ????
----------------------------
Attorney-In-Fact
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<PAGE> 13
EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, March __ 1998
No. W-1993__ _______ Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that ________________, or registered
assigns, is the registered holder of ______ Warrants to purchase initially, at
any time from March __, 1993 until 5:30 p.m. Denver time on March __, 1998
("Expiration Date"), up to ______ shares of Class A voting common stock, $.01
par value ("Common Stock") of CRYENCO SCIENCES, INC., a Delaware corporation
(the "Company"), at the price per share of Common Stock equal to the Exercise
Price set forth in the Warrant Agreement dated as of March ___, 1993 between
the Company and ____________ (the "Warrant Agreement"), upon surrender of this
Warrant Certificate and payment of the Exercise Price at an office or agency
of the Company, but subject to the conditions set forth herein and in the
Warrant Agreement. Payment of the Exercise Price shall be made by certified or
official bank cashier's check payable to the order of the Company; provided,
however, that the holder hereof shall have the right, at his or its election,
in lieu of delivering the Exercise Price in cash, to instruct the Company in
the form of subscription to retain, in payment of the Exercise Price, a number
of shares of Common Stock (the "Payment Shares") equal to the quotient of (i)
the Exercise Price multiplied by the number of shares as to which this Warrant
is then being exercised divided by (ii) the "Average Closing Price" as of the
date of exercise and to deduct the number of Payment Shares from the shares to
be delivered to
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<PAGE> 14
the holder hereof. "Average Closing Price" means, as of any date, (x) if shares
of Common Stock are listed on a national securities exchange, the average of the
closing sales prices therefor on the largest securities exchange on which such
shares are traded on the last ten (10) trading days before such date, (y) if
such shares are listed on the NASDAQ National Market System but not on any
national securities exchange, the average of the closing sales prices therefor
on the NASDAQ National Market System on the last ten (10) trading days before
the date of the exercise of the Warrants or (z) if such shares are not listed on
either a national securities exchange or the NASDAQ National Market System, the
average of the sales prices therefor on the last twenty (20) trading days before
the date of the exercise of the Warrants.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, hereby shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders" or "holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain events
the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; provided,
however, that the failure of the Company to issue such new Warrant Certificates
shall not in any way change, alter, or otherwise impair, the rights of the
holder as set forth in the Warrant Agreement to purchase the number of shares
for the exercise price as so adjusted or any other rights set forth in the
Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
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<PAGE> 15
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed under its corporate seal.
Dated as of March __, 1993
CRYENCO SCIENCES, INC.
[SEAL] By: _________________________
Name:
Title:
Attest:
__________________________
Name:
Title:
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<PAGE> 16
FORM OF ELECTION TO PURCHASE
TO: Cryenco Sciences, Inc.
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
__________ shares of Class A voting Common Stock;
and herewith [tenders in payment for such securities a certified or
official bank cashier's check payable to the order of CRYENCO SCIENCES, INC. in
the amount of $________ therefor] [instructs you herein, in payment of the
Exercise Price, to deduct ______ shares of Class A voting Common Stock and to
deliver the net number of shares, being ____ shares of Class A voting Common
Stock]. The undersigned requests that a certificate for such securities be
registered in the name of ______________ whose address is ______________________
and that such Certificate be delivered to _________________________ whose
address is _________________.
Dated: Signature:______________________________
(Signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate.)
(Insert Social Security or Other
Identifying Number of Holder)
-17-
<PAGE> 17
FORM OF ASSIGNMENT
(To be exercised by the registered holder if such holder
desires to transfer the Warrant Certificate to the extent permitted
by Section 5 of the Warrant Agreement.)
FOR VAlUE RECEIVED ______________________________________________
hereby sells, assigns and transfers unto
___________________________________________________
(Please print name and address of transferee)
this Warrant Certificate; together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _____________ Attorney, to
transfer the within Warrant Certificate on the books of the within-named
Company, with full power of substitution.
Dated: Signature:____________________________
(signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate.)
(Insert Social Security or Other
Identifying Number of Assignee)
-18-
<PAGE> 1
Exhibit 4.22
WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER SUCH
ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF COUNSEL,
IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE ISSUER, THAT
AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, March 11, 1998
No. W-1993C 30,000 Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that Mezzanine Capital Corporation
Limited, or registered assigns, is the registered holder of 30,000 Warrants to
purchase initially, at any time from March 12, 1993 until 5:30 p.m. Denver time
on March 11, 1998 ("Expiration Date"), up to 30,000 shares of Class A voting
common stock, $.0l par value ("Common Stock") of CRYENCO SCIENCES, INC., a
Delaware corporation (the "Company"), at the price per share of Common Stock
equal to the Exercise Price set forth in the Warrant Agreement dated as of March
12, 1993 between the Company and Mezzanine Capital Corporation Limited (the
"Warrant Agreement"), upon surrender of this Warrant Certificate and payment of
the Exercise Price at an office or agency of the Company, but subject to the
conditions set forth herein and in the Warrant Agreement. Payment of the
Exercise Price shall be made by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the holder hereof
shall have the right, at his or its election, in lieu of delivering the Exercise
Price in cash, to instruct the Company in the form of subscription to retain, in
payment of the Exercise Price, a number of shares of Common Stock (the "Payment
Shares") equal to the quotient of (i) the Exercise Price multiplied by the
number of shares as to which this Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct
<PAGE> 2
the number of Payment Shares from the shares to be delivered to the holder
hereof. "Average Closing Price" means, as of any date, (x) if shares of Common
Stock are listed on a national securities exchange, the average of the closing
sales prices therefor on the largest securities exchange on which such shares
are traded on the last ten (10) trading days before such date, (y) if such
shares are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last ten (10) trading days before the date
of the exercise of the Warrants or (z) if such shares are not listed on either a
national securities exchange or the NASDAQ National Market System, the average
of the sales prices therefor on the last twenty (20) trading days before the
date of the exercise of the Warrants.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, hereby shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders or "holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain events
the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; provided,
however, that the failure of the Company to issue such new Warrant Certificates
shall not in any way change, alter, or otherwise impair, the rights of the
holder as set forth in the Warrant Agreement to purchase the number of shares
for the exercise price as so adjusted or any other rights set forth in the
Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or
-2-
<PAGE> 3
other governmental charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
duly executed under its corporate seal.
Dated as or March 12,1993
CRYENCO SCIENCES, INC.
[SEAL] By: /s/ Don M. Harwell
-----------------------
Name: Don M. Harwell
Title: Vice President
Attest:
/s/ Alison A. Murray
- -----------------------
Name: Alison A. Murray
Title: Secretary
-3-
<PAGE> 1
Exhibit 4.23
WARRANT AGREEMENT
WARRANT AGREEMENT dated as of Januay 26, 1995 between CRYENCO SCIENCES,
INC., a Delaware corporation (the "Company"), and Mezzanine Capital Corporation
Limited (the "Holder").
1. GRANT. Subject to the terms of this Agreement, in consideration of
$10.00 and other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged by the Company, the Holder is hereby initially
granted the right to purchase, at any time and from time to time from January
26, 1995 until 5:30 p.m., Denver time on January 25, 2000 (the "Exercise
Period"), up to an aggregate of 15,000 shares of Common Stock at an initial
exercise price of $3.55. The adjusted exercise price shall be the price which
shall result from time to time from any and all adjustments of the initial
exercise price, in accordance with the provisions of SECTION 6 hereof. The term
"Exercise Price" herein shall mean the initial exercise price, as applicable
based on the date of exercise, or the adjusted exercise price, depending upon
the context.
2. WARRANT CERTIFICATES. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall be
in the form set forth in Exhibit A, attached hereto and made a part hereof, with
such appropriate insertions, omissions, substitutions and other variations as
required or permitted by this Agreement.
3. EXERCISE OF WARRANTS. The Warrants initially are exercisable at the
Exercise Price (subject to adjustment as provided in SECTION 6 hereof) per share
of Common Stock, payable by certified or official bank cashier's check payable
to the order of the Company; PROVIDED, HOWEVER, that the Holder shall have the
right, at his or its election, in lieu of delivering the Exercise Price in cash,
to instruct the Company in the form of subscription to retain, in payment of the
Exercise Price, a number of shares of Common Stock (the "Payment Shares") equal
to the quotient of (i) the Exercise Price multiplied by the number of shares as
to which the Warrant is then being exercised divided by (ii) the "Average
Closing Price" as of the date of exercise and to deduct the number of Payment
Shares from the shares to be delivered to the Holder. "Average Closing Price"
means, as of any date, (x) if shares of Common Stock are listed on a national
securities exchange, the average of the closing sales prices therefor on the
largest securities exchange on which such shares are traded on the last 10
trading days before such date, (y) if such shares are listed on the NASDAQ
National Market System but not on any national securities exchange, the average
of the closing sales prices therefor on the NASDAQ National Market System on the
last 10 trading days before such date or (z) if such shares are not listed on
either a national securities exchange or the NASDAQ National Market System, the
average of the sales prices therefor on the last 20 trading days before such
date. Upon surrender of a Warrant Certificate with the annexed Form of Election
to Purchase duly executed, together with payment of the Exercise Price for the
shares of Common Stock at the Company's principal offices (currently located at
3811 Joliet Street, Denver, Colorado 80239), the Holder or any
<PAGE> 2
subsequent registered holder or holders of a Warrant Certificate (any such
subsequent holder or holders also referred to herein as the "Holder" or
"Holders") shall be entitled to receive a certificate or certificates for the
shares of Common Stock so purchased for the Warrants so exercised. The purchase
rights represented by each Warrant Certificate are exercisable at the option of
the Holder thereof, in whole or in part (but not as to fractional shares of the
Common Stock underlying the Warrants). Warrants may be exercised to purchase all
or part of the shares of Common Stock represented thereby. In the case of the
purchase of less than all the securities purchasable under any Warrant
Certificate, the Company shall cancel said Warrant Certificate upon the
surrender thereof and, unless the Warrant has expired, shall execute and deliver
a new Warrant Certificate of like tenor for the balance of the securities
purchasable thereunder. With respect to any such exercise, the Holder shall for
all purposes be deemed to have become the holder of record of the number of
shares of Common Stock from the date on which the Warrant was surrendered and
payment of the Exercise Price was made irrespective of the date of delivery of
such shares, except that, if the date of such surrender and payment is a date on
which the stock transfer books of the Company are closed, such person shall be
deemed to have become the holder of such shares at the close of business on the
next succeeding date on which the stock transfer books are open.
4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the
issuance of certificates for the shares of Common Stock shall be made forthwith
(and in any event within 10 business days thereafter) without charge to the
Holder thereof including, without limitation, any tax which may be payable in
respect of the issuance thereof, and such certificates shall (subject to the
provisions of SECTIONS 5 and 7 hereof) be issued in the name of, or in such
names as may be directed by, the Holder thereof; provided, however, that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any such certificates in
a name other than that of the Holder and the Company shall not be required to
issue or deliver such certificates unless or until the person or persons
requesting the issuance thereof in a name other than that of the Holder 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.
The Warrant Certificates and the certificates representing the shares of
Common Stock shall be executed on behalf of the Company by the manual or
facsimile signature of the then present Chairman or Vice Chairman of the Board
of Directors or President or Vice President of the Company under its corporate
seal reproduced thereon, attested to by the dual or facsimile signature of the
then present Secretary or Assistant Secretary of the Company. Warrant
Certificates shall be dated the date of execution by the Company upon initial
issuance, division, exchange, substitution or transfer.
5. RESTRICTION ON TRANSFER OF WARRANTS.
There shall be not more than five (5) Holders of record of the Warrants.
The Holder of a Warrant Certificate, by his or its acceptance thereof,
covenants and agrees that the Warrants may not be sold, transferred, assigned,
hypothecated or otherwise disposed of, in
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<PAGE> 3
whole or in part, except to or among wholly owned subsidiaries of the Holder or
officers, directors or employees of the Holder, who also shall hold the
warrants subject to the restrictions contained in this Section 5.
6. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES.
6.1 COMPUTATION OF ADJUSTED EXERCISE PRICE. For the purposes of this
SECTION 6, the term Exercise Price shall mean the Exercise Price per share of
Common Stock set forth in SECTION 1 hereof, as adjusted from time to time
pursuant to the provisions of this SECTION 6.
6.2 SUBDIVISION AND COMBINATIONS. In case the Company shall at any time
subdivide (for example, a stock split or stock dividend) or combine (for
example, a reverse stock split) the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
6.3 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this SECTION 6, the number of
securities issuable upon the exercise of each Warrant shall be adjusted to the
nearest full share by multiplying a number equal to the Exercise Price in
effect immediately prior to such adjustment by the number of shares of Common
Stock (or other securities as provided in this SECTION 6) issuable upon
exercise of the Warrants immediately prior to such adjustment and dividing the
product so obtained by the adjusted Exercise Price.
6.4 DEFINITION OF COMMON STOCK. For the purpose of this Agreement, the
term "Common Stock" shall mean (i) the class of stock designated as Class A
Voting Common Stock, $.01 par value, in the Restated Certificate of
Incorporation of the Company as of the date hereof, (ii) the class of stock
designated as Class B non-voting Convertible Common Stock, $.0l par value, in
the Restated Certificate of Incorporation, as amended, of the Company as of the
date hereof, (iii) any other capital stock of any class or classes (however
designated) of the Company the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of current
dividends and distributions on any shares entitled to preference except the
Series A Preferred Stock of the Company and (iv) any other securities into
which or for which any of the securities described in clauses (i), (ii) or
(iii) above have been converted, exchanged or combined pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise. In the
event that the Company shall after the date hereof issue securities with
greater or superior voting rights than the shares of Common Stock outstanding
as of the date hereof, the Holder, at his or its option, may receive upon
exercise of any Warrant either shares of Common Stock or an equal number of
such securities with greater or superior voting rights.
6.5 MERGER OR CONSOLIDATION. If any capital reorganization or
reclassification of the capital stock of the Company or any consolidation,
merger or other transaction of the Company with another corporation in which
the Company is the surviving corporation, or the sale of all or substantially
all of the Company's assets to another corporation shall be effected
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<PAGE> 4
in such a way that holders of Common Stock shall be entitled to receive
consideration (including but not limited to stock, securities or assets) with
respect to or in exchange for Common Stock, then, as a condition of such
reorganization, reclassification, consolidation, merger or sale, lawful and
adequate provisions shall be made whereby each Holder shall thereafter have the
right to receive upon the basis and upon the terms and conditions specified
herein and in lieu of the shares of Common Stock of the Company immediately
theretofore so receivable upon the exercise of each Warrant or Warrants, such
shares of stock, securities or assets (including cash) as may be issued or
payable with respect to or in exchange for a number of outstanding shares of
such Common Stock equal to the number of shares of such stock immediately
theretofore so receivable had such reorganization, reclassification,
consolidation, merger or sale not taken place, and in any such case appropriate
provision shall be made with respect to the rights and interests of such Holder
to the end that the provisions hereof (including, without limitation,
provisions for adjustments of the Exercise Price) shall thereafter be
applicable, as nearly as may be, in relation to any shares of stock, securities
or assets thereafter deliverable upon the exercise of such rights. In the event
of a merger or consolidation of the Company or other transaction in which the
Company is not the surviving corporation or in which, as the result of the
transaction, no trading market will exist for the Common Stock, the Company
shall give notice regarding the transaction in accordance with SECTION 12
hereof as soon as practicable (and in no event less than 20 days prior to the
record date fixed for the transaction or, if none, the closing date for such
transaction) in order to afford the Holders the opportunity to exercise their
Warrants and receive after exercise the same consideration payable in the
transaction to other holders of Common Stock. This SECTION 6.5 shall similarly
apply to successive reorganizations, classifications, consolidations, mergers
or other transaction contemplated hereby.
6.6 NOTICE OF ADJUSTMENT. Upon any adjustment of the Exercise Price, the
Company shall give written notice thereof to each Holder in accordance with
SECTION 12 hereof, which notice shall state the Exercise Price resulting from
such adjustment, setting forth in reasonable detail the method of calculation
and the facts upon which such calculation is based.
7. REGISTRATION RIGHTS.
7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. The Warrants and the
shares of Common Stock have not been registered for sale under the Act. Upon
exercise of the Warrants, in part or in whole, certificates representing the
shares of Common Stock shall bear the following legend:
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended ("Act"), and may not be
offered or sold except pursuant to (i) an effective registration
statement under the Act, (ii) to the extent applicable, Rule 144 under
the Act (or any similar rule under such Act relating to the disposition
of securities), or (iii) an opinion of counsel, if such opinion shall be
reasonably satisfactory to counsel to the issuer that an exemption from
registration under such Act is available.
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<PAGE> 5
7.2 PIGGYBACK REGISTRATION.
(a) If, at any time commencing after the date hereof through and
including the fifth anniversary hereof the Company proposes to register
any of its equity securities under the Act (other than in connection with
a transaction contemplated by Rule 145(a) promulgated under the Act or
pursuant to Form S-8 or S-4 or successor forms) it will give written
notice by registered or certified mail, at least 15 days prior to the
filing of each such registration statement, to the Holders of the
Warrants of its intention to do so. If the Holders of the Warrants notify
the Company within 15 days after receipt of any such notice of its or
their desire to include Common Stock underlying the Warrants in such
proposed registration statement, the Company shall afford such Holders of
the opportunity to have any such Common Stock registered under such
registration statement.
(b) In the case of an underwritten offering, if the managing
underwriter of the offering determines and advises the Company in writing
that inclusion of the Common Stock of the Holders requested to be
included would interfere with the successful offering of shares by the
Company there shall be excluded from such offering, to the extent that
the managing underwriter deems necessary, shares of Common Stock owned by
the Holders on a PRO RATA basis.
(c) Notwithstanding anything to the contrary herein, any
registration rights hereunder shall not be exercisable at any time or
with respect to any proposed registration unless each of Chemical Bank
and The CIT Group/Equity Investments, Inc. shall have exercised to the
fullest extent permitted by the applicable agreement with the Company or
waived any registration rights held by either of them at such time or in
connection with such registration.
7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In connection
with any registration under SECTION 7.2 hereof, the Company covenants and
agrees as follows:
(a) The Company shall pay all reasonable costs (excluding transfer
taxes, if any, and fees and expenses of Holder(s)' counsel and any
underwriting or selling commissions), fees and expenses in connection
with all registration statements filed pursuant to SECTION 7.2 hereof
including, without limitation, the Company's legal and accounting fees
(including the costs and expenses of any special audit or other
procedures), printing expenses, blue sky fees and expenses.
(b) The Company will take all necessary action which may be
required in qualifying or registering the Common Stock included in a
registration statement for offering and sale under the securities or blue
sky laws of such states as reasonably are requested by the Holder(s)
provided, however, that the number of states in which qualification or
registration shall be required shall not exceed five
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<PAGE> 6
(5) and in no event shall the Company be required to effect such
qualification or registration if such act would require the Company to
qualify as a foreign corporation or to file a general consent to service
of process in any jurisdiction where it is not now so qualified or
required to file such a consent.
(c) Upon any registration becoming effective pursuant to this
SECTION 7, the Company shall use its best efforts to: (i) keep such
registration statement current for a period of 90 days; (ii) prepare and
file with the Securities and Exchange Commission (the "Commission") such
amendments and supplements to such registration statement as may be
necessary to comply with the provisions of the Act and the Regulations of
the Commission with respect to the disposition of all securities covered
by such registration statement; (iii) cause all the Common Stock
registered pursuant to such registration statement to be listed on each
exchange or automated quotation system on which the Common Stock is then
listed; (iv) provide a transfer agent and registrar for all stock
registered pursuant to such registration statement and CUSIP number for
all such stock, in each case not later than the effective date of such
registration; and (v) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission.
(d) The Company shall indemnify and hold harmless the Holder(s) of
the Common Stock to be sold pursuant to any registration statement and
each person, if any, who controls such Holders within the meaning of
Section 15 of the Act or Section 20(a) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), against and from all loss, claim,
damage, expense or liability (including all expenses reasonably incurred
in investigating, preparing or defending against any claim whatsoever) to
which any of them may become subject under the Act, the Exchange Act or
otherwise, arising from such registration statement, except such matters
in respect of which such Holders are required to indemnify the Company
under the next succeeding paragraph.
(e) The Holders of the Common Stock to be sold pursuant to a
registration statement, and its or their successors and assigns, shall
indemnify and hold harmless the Company, its officers and directors and
each person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, against and
from all loss, claim, damage, expense or liability (including all
expenses reasonably incurred in investigating, preparing or defending
against any claim whatsoever) to which they may become subject under the
Act, the Exchange Act or otherwise, arising from information furnished by
or on behalf of such Holders or its or their successors or assigns, for
specific inclusion in such registration statement.
(f) Any person entitled to indemnification under this SECTION 7
will (i) give prompt written notice to the indemnifying party of any
claim with respect to which it seeks indemnification and (ii) unless in
such indemnified party's
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<PAGE> 7
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 will not be subject to any liability for
any settlement made by the indemnified party without its consent (but
such consent will not be unreasonably withheld). An indemnifying party
who is not entitled to, or elects not to, assume the defense of a claim
will 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.
(g) Nothing contained in this Agreement shall be construed as
requiring the Holder to exercise his or its Warrants prior to the initial
filing of any registration statement or the effectiveness thereof.
(h) The Company at its expense shall deliver promptly to each
Holder participating in the offering and requesting the correspondence
and memoranda described below copies of all documents proposed to be
filed with the Commission, all correspondence between the Commission and
the Company, its counsel or auditors, and all memoranda relating to the
registration statement and permit each such Holder at its expense to do
such investigation, upon reasonable advance notice, with respect to
information contained in or omitted from the registration statement as it
deems reasonably necessary to comply with applicable securities laws or
rules of the National Association of Securities Dealers, Inc. Such
investigation shall include access to books, records and properties and
opportunities to discuss the business of the Company with its officers
and independent auditors, all to such reasonable extent and at such
reasonable times and as often as any such Holder shall reasonably
request.
8. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of securities in such denominations as shall
be designated by the Holder thereof at the time of such surrender, subject to
the provisions of Section 5 hereof.
Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation of any Warrant Certificate, and, in
case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Warrant
Certificate, if mutilated, the Company will make and deliver a new Warrant
Certificate of like tenor, in lieu thereof.
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<PAGE> 8
9. ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be required
to issue certificates representing fractions of shares of Common Stock upon the
exercise of the Warrants, nor shall it be required to issue scrip or pay cash
in lieu of fractional interests, it being the intent of the parties that all
fractional interests shall be eliminated by rounding any fraction up to the
nearest whole number of shares of Common Stock or other securities, properties
or rights.
10. RESERVATION AND LISTING. The Company shall at times have and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon the exercise of the Warrants, such number of shares of Common
Stock or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants, and payment of the respective exercise price therefor, all shares of
Common Stock and other securities issuable upon such exercise shall, at the
time of delivery thereof, be duly and validly issued, fully paid,
nonassessable, not subject to the preemptive rights of any stockholder and free
from all taxes, liens and charges with respect to the issue thereof. The
Company will take all such action as may be necessary to ensure that all such
shares of Common Stock may be so issued without violation of any applicable law
or regulation, or of any requirements of any national securities exchange upon
which the Common Stock of the Company may be listed. The Company will not take
any action which results in any adjustment of the Exercise Price if the total
number of shares of Common Stock issued and issuable after such action upon
exercise of the Warrants would exceed the total number of shares of Common
Stock then authorized by the Company's Restated Certificate of Incorporation.
The Company has not granted and will not grant any right of first refusal with
respect to shares issuable upon exercise of the Warrants, and there are no
preemptive rights associated with such shares. As long as the Warrants shall be
outstanding, the Company shall use its best efforts to cause all shares of
Common Stock issuable upon exercise of the Warrants to be listed (subject to
official notice of issuance) on all securities exchanges, if any, on which the
Common Stock issued to the public in connection herewith may then be listed
and/or quoted on NASDAQ.
11. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement shall
be construed as conferring upon the Holders the right to vote or to consent or
to receive notice as a stockholder in respect of any meetings of stockholders
for the election of directors or any other matter, or as having any rights
whatsoever as a stockholder of the Company. If, however, at any time prior to
the expiration of the Warrants and their exercise, any of the following events
shall occur:
(a) the Company shall take a record of the holders of its shares of
Common Stock for the purpose of entitling them to receive a dividend or
distribution payable otherwise than in cash, or a cash dividend or
distribution payable otherwise than out of current or retained earnings,
as indicated by the accounting treatment of such dividend or distribution
on the books of the Company; or
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<PAGE> 9
(b) the Company shall offer to all the holders of its Common Stock
any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capital stock of the
Company, or any option, right or warrant to subscribe therefor; or
(c) a dissolution, liquidation or winding up of the Company (other
than in connection with a consolidation or merger) or a sale of all or
substantially all of its property, assets and business as an entity shall
be proposed
then, in any one or more of said events, the Company shall give written notice
of such event at least 15 days prior to the date fixed as a record date or the
date of closing the transfer books for the determination of the stockholder
entitled to such dividend, distribution, convertible or exchangeable securities
or subscription rights, or entitled to vote on such proposed dissolution,
liquidation, winding up or sale. Such notice shall specify such record date or
the date of closing the transfer books, as the case may be. Failure to give
such notice or any defect therein shall not affect the validity of any action
taken in connection with the declaration or payment of any such dividend, or
the issuance of any convertible or exchangeable securities or subscription
rights, options or warrants or any proposed dissolution, liquidation, winding
up or sale.
12. NOTICES.
All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been duly made when
delivered, or mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in SECTION 3
hereof or to such other address as the Company may designate by
notice to the Holders.
13. SUPPLEMENTS AND AMENDMENTS. The Company and the Holder may from
time to time supplement or amend this Agreement without the approval of any
subsequent Holders of Warrant Certificates (other than the Holder) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with provisions herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which the Company
and the Holder deem shall not adversely affect the interests of the Holders of
Warrant Certificates.
14. SUCCESSORS. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit of the Company, the Holders, the
limited partners of the Holder and their respective successors and assigns
hereunder.
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<PAGE> 10
15. TERMINATION. This Agreement shall terminate at the close of
business on January 25, 2000. Notwithstanding the foregoing, the
indemnification provisions of SECTION 7 shall survive such termination until
the close of business on January 25, 2003.
16. GOVERNING LAW: SUBMISSION TO JURISDICTION. This Agreement and each
Warrant Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be construed
in accordance with the laws of said State without giving effect to the rules of
said State governing the conflicts of laws.
The Company and the Holders hereby agree that any action, proceeding
or claim against it arising out of, or relating in any way to, this Agreement
shall be brought and enforced in the courts of the state of New York or of the
United States of America for the Southern District of New York, and irrevocably
submits to such jurisdiction, which jurisdiction shall be exclusive. The
Company and the Holders hereby irrevocably waive any objection to such
exclusive jurisdiction or inconvenient forum. Any such process or summons to be
served upon any of the Company and the Holders (at the option of the party
bringing such action, proceeding or claim) may be served by transmitting a copy
thereof, by registered or certified mail, return receipt requested, postage
prepaid, addressed to it at the address set forth in SECTION 12 hereof. Such
mailing shall be deemed personal service and shall be legal and binding upon
the party so served in any action, proceeding or claim.
17. ENTIRE AGREEMENT; MODIFICATION. This Agreement contains the entire
understanding between the parties hereto with respect to the subject matter
hereof and may not be modified or amended except by a writing duly signed by
the party against whom enforcement of the modification or amendment is sought.
18. SEVERABILITY. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
19. CAPTIONS. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive
effect.
20. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Holder and any subsequent registered Holder(s) of the Warrant Certificates or
Warrants any legal or equitable right, remedy or claim under this Agreement;
and this Agreement shall be for the sole and exclusive benefit of the Company
and the Holder and subsequent Holder(s) of the Warrant Certificates or
Warrants.
21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and the
same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
CRYENCO SCIENCES, INC.
By: /s/ Alfred Schechter
---------------------------
Name: Alfred Schechter
Title: President
Attest:
/s/ Alison A. Murray
- -------------------------
Name: Alison A. Murray
Title: Secretary MEZZANINE CAPITAL
CORPORATION LIMITED
By: /s/ Jerome L. Katz
---------------------------
Name Jerome L. Katz
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EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER. THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME. ____________, 2000
No. W-1995(A)______ ________ Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that ________________________, or
registered assigns, is the registered holder of ___________ Warrants to
purchase initially, at any time from _______________, 1995 until 5:30 p.m.,
Denver time, on _________________, 2000 ("Expiration Date"), up to ______
shares of Class A voting common stock, $.01 par value ("Common Stock") of
CRYENCO SCIENCES, INC., a Delaware corporation (the "Company"), at the price
per share of Common Stock equal to the Exercise Price set forth in the Warrant
Agreement dated as of __________________, 1995 between the Company and
____________________ (the "Warrant Agreement"), upon surrender of this Warrant
Certificate and payment of the Exercise Price at an office or agency of the
Company, but subject to the conditions set forth herein and in the Warrant
Agreement. Payment of the Exercise Price shall be made by certified or official
bank cashier's check payable to the order of the Company; PROVIDED, HOWEVER,
that the Holder shall have the right, at his or its election, in lieu of
delivering the Exercise Price in cash, to instruct the Company in the form of
subscription to retain, in payment of the Exercise Price, a number of shares of
Common Stock (the "Payment Shares") equal to the quotient of (i) the Exercise
Price multiplied by the number of shares as to which the Warrant is then being
exercised divided by (ii) the "Average Closing Price" as of the date of
exercise and to deduct the number of Payment Shares from the shares to be
delivered
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to the Holder. "Average Closing Price" means, as of any date, (x) if shares of
Common Stock are listed on a national securities exchange, the average of the
closing sales prices therefor on the largest securities exchange on which such
shares are traded on the 10 trading days before such date, (y) if such shares
are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last 10 trading days before such date or
(z) if such shares are not listed on either a national securities exchange or
the NASDAQ National Market System, the average of the sales prices therefor on
the last 20 trading days before such date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the Holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
PROVIDED, HOWEVER, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the Holder as set forth in the Warrant Agreement to purchase the
number of shares for the exercise price as so adjusted or any other rights set
forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in the
Warrant Agreement, without any charge except for any tax or other governmental
charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the
13
<PAGE> 14
Holder(s) hereof, and for all other purposes, and the Company shall not be
affected by any notice to the contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Date as of ________________, 1995
CRYENCO SCIENCES, INC.
[SEAL]
By:________________________
Name:
Title:
Attest:
___________________________
Name:
Title:
14
<PAGE> 15
FORM OF ELECTION TO PURCHASE
TO: Cryenco Sciences, Inc.
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
____________ shares of Class A voting Common Stock;
and herewith [tenders in payment for such securities a certified or
official bank cashier's check payable to the order of CRYENCO SCIENCES, INC. in
the amount of $______________ therefor] [instructs you herein, in payment of
the Exercise Price, to deduct ___________ shares of Class A voting Common Stock
and to deliver the net number of shares, being _________ shares of Class A
voting Common Stock]. The undersigned requests that a certificate for such
securities be registered in the name of __________________________ whose
address is _____________________________________________ and that such
Certificate be delivered to __________________________________ whose address is
_________________________________.
Dated: Signature:_________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Holder)
15
<PAGE> 16
FORM OF ASSIGNMENT
(To be exercised by the registered holder if such holder desires to
transfer the Warrant Certificate to the extent permitted by Section 5 of the
Warrant Agreement.)
FOR VALUE RECEIVED ________________________________ hereby sells,
assigns and transfers unto
____________________________________________________
(Please print name and address of transferee)
this Warrant Certificate; together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _______________________
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company, with full power of substitution.
Dated: Signature:_________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Assignee)
16
<PAGE> 1
Exhibit 4.24
WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, JANUARY 25, 2000
No. W-1995(A)3 15,000 Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that Mezzanine Capital Corporation
Limited, or registered assigns, is the registered holder of 15,000 Warrants to
purchase initially, at any time from January 26, 1995 until 5:30 p.m., Denver
time, on January 25, 2000 ("Expiration Date"), up to 15,000 shares of Class A
voting common stock, $.01 par value ("Common Stock") of CRYENCO SCIENCES, INC.,
a Delaware corporation (the "Company"), at the price per share of Common Stock
equal to the Exercise Price set forth in the Warrant Agreement dated as of
January 26, 1995 between the Company and Mezzanine Capital Corporation Limited
(the "Warrant Agreement"), upon surrender of this Warrant Certificate and
payment of the Exercise Price at an office or agency of the Company, but
subject to the conditions set forth herein and in the Warrant Agreement.
Payment of the Exercise Price shall be made by certified or official bank
cashier's check payable to the order of the Company; PROVIDED, HOWEVER, that
the Holder shall have the right, at his or its election, in lieu of delivering
the Exercise Price in cash, to instruct the Company in the form of subscription
to retain, in payment of the Exercise Price, a number of shares of Common Stock
(the "Payment Shares") equal to the quotient of (i) the Exercise Price
multiplied by the number of shares as to which the Warrant is then being
exercised divided by (ii) the "Average Closing Price" as of the date of
exercise and to deduct the number of Payment Shares from the shares to be
delivered to the Holder. "Average Closing Price" means, as of any date, (x) if
shares of Common Stock are listed on a national securities exchange, the
average of the closing sales prices therefor on the largest securities exchange
on
<PAGE> 2
which such shares are traded on the 10 trading days before such date, (y) if
such shares are listed on the NASDAQ National Market System but not on any
national securities exchange, the average of the closing sales prices therefor
on the NASDAQ National Market System on the last 10 trading days before such
date or (z) if such shares are not listed on either a national securities
exchange or the NASDAQ National Market System, the average of the sales prices
therefor on the last 20 trading days before such date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the Holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
PROVIDED, HOWEVER, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the Holder as set forth in the Warrant Agreement to purchase the
number of shares for the exercise price as so adjusted or any other rights set
forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in the
Warrant Agreement, without any charge except for any tax or other governmental
charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the Holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
2
<PAGE> 3
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Date as of January 26, 1995
CRYENCO SCIENCES, INC.
[SEAL]
By: /s/ Alfred Schechter
------------------------
Name: Alfred Schechter
Title: President
Attest:
/s/ Alison A. Murray
- -----------------------
Name: Alison A. Murray
Title: Secretary
3
<PAGE> 1
Exhibit 4.25
AMENDMENT NO. 1 TO WARRANT AGREEMENT
This Amendment No. 1 to Warrant Agreement is made as of this 31st day
of July, 1997, by and between Mezzanine Capital Corporation Limited (in
liquidation) (the "Holder"), Cryenco Sciences, Inc., a Delaware corporation
(f/k/a Cryenco Holdings, Inc.) ("Cryenco") and Chart Industries, Inc., a
Delaware corporation ("Chart").
WHEREAS, the Holder and Cryenco are parties to a warrant agreement or
agreements (the "Warrant Agreement") dated as of March 13, 1993 and January 26,
1995, pursuant to which Cryenco granted the Holder a warrant or warrants (the
"Cryenco Warrant") to purchase an aggregate of 45,000 shares of Cryenco Class A
common stock, par value $.01 per share (the "Cryenco Common Stock");
WHEREAS, Cryenco and Chart entered into a Plan and Agreement of Merger
dated as of April 30, 1997 (the "Merger Agreement") providing for the merger of
an affiliate of Chart into Cryenco (the "Merger") and the conversion of all
issued and outstanding Cryenco Common Stock (other than dissenters' shares)
into cash in the amount of $2.75 per share;
WHEREAS, in Section 5.4(b)(iii) of the Merger Agreement, Chart has
agreed to offer to grant a substitute warrant (the "Chart Warrant") to purchase
shares of Chart's common stock, par value $.01 per share (the "Chart Common
Stock), in exchange for the Cryenco Warrant; and
WHEREAS, the Holder, Cryenco and Chart now desire that, in satisfaction
of Chart's obligations under Section 5.4(b)(iii) of the Merger Agreement, the
Cryenco Warrant be amended to provide the Holder with the right to purchase
Chart Common Stock in substitution for the right to purchase Cryenco Common
Stock;
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements and undertakings set forth herein, the parties hereby agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall
have the meaning ascribed to them in the Merger Agreement.
2. AMENDMENT. As of the effective time of the Merger (the "Effective
Time"), the Warrant Agreement and the form of Cryenco Warrant referenced therein
are hereby amended as follows:
(a) CHART COMMON STOCK SUBSTITUTED FOR CRYENCO COMMON STOCK. All
references to the right of the Holder to purchase shares of
Cryenco Common Stock shall be deleted and the right to
purchase shares of Chart Common Stock shall be substituted
therefor.
<PAGE> 2
(b) ADJUSTMENT TO NUMBER OF SHARES UNDERLYING WARRANT. The number
of shares of Chart Common Stock issuable upon exercise of the
warrant shall be the product of (i) the number of shares of
Cryenco Common Stock that were issuable upon exercise of the
Cryenco Warrant times (ii) a fraction (the "Exchange Ratio")
the numerator of which shall be $2.75 and the denominator of
which shall be the average of the closing sales price of
Chart Common Stock on the New York Stock Exchange as reported
by the Wall Street Journal for the ten trading days preceding
the Effective Time; provided, however, that in no event shall
the Exchange Ratio be less than .165 nor more than .206.
(c) ADJUSTMENT TO PURCHASE OR EXERCISE PRICE. The purchase or
exercise price per share of Chart Common Stock subject to the
Chart Warrant shall be equal to (i) the purchase or exercise
price per share of Cryenco Common Stock divided by (ii) the
Exchange Ratio.
(d) NOTICES. Any notices, requests, forms, certificates or other
documents or communications deliverable to Cryenco under the
Warrant Agreement shall be required to be delivered instead
to Chart at 35555 Curtis Boulevard, Eastlake, OH 44095, to
the attention of the Chief Financial Officer, with a copy to
Calfee, Halter & Griswold LLP, 1400 McDonald Investment
Center, 800 Superior Avenue, Cleveland, OH 44114, Attention:
Thomas F. McKee.
(e) SUBMISSION TO JURISDICTION. Any provision in the Warrant
Agreement requiring that any action, claim or proceeding
arising out of, or relating in any way to, the Warrant
Agreement be brought exclusively in a jurisdiction located in
the State of Colorado shall be deleted in its entirety.
(f) SUBSTITUTION OF WARRANTS. Chart and the Holder agree that any
and all Warrants and/or Warrant Certificates issued pursuant
to the Warrant Agreement shall be amended in a manner
consistent with the provisions of this Amendment No. 1 and
that, upon the Holder's presentation to Chart of such
Warrants or Warrant Certificates, Chart shall deliver to the
Holder, in exchange and substitution therefor, new Warrant or
Warrant Certificates.
3. FULL COMPLIANCE: ASSUMPTION OF CRYENCO'S OBLIGATIONS: REFERENCES TO
CRYENCO. The Holder acknowledges and agrees that, as of the Effective Time,
Cryenco is in full compliance with all of its obligations under the Warrant
Agreement, the Cryenco Warrant and any related agreements pertaining to
registration rights of the Holder with respect to the shares of Cryenco Common
Stock issuable upon exercise of the Warrants. As of the Effective Time, Chart
assumes all of the obligations of Cryenco under the Warrant Agreement as
amended hereby, and all references to Cryenco in the Warrant Agreement shall be
deemed to be
<PAGE> 3
references to Chart. To the extent that Holder is party to a separate
registration rights agreement relating to Cryenco Common Stock, promptly after
the Effective Time, Chart and the Holder shall enter into such supplemental
agreement as may be necessary to provide the Holder with equivalent
registration rights relating to Chart Common Stock issuable upon exercise of
the Chart Warrant.
4. RECEIPT OF CHART DISCLOSURES. The Holder acknowledges that it has
received copies of Chart's 1996 Form 10-K Report and Chart's Form 10-Q Report
for the three-month period ended March 31, 1997.
5. NO RIGHT TO PURCHASE CRYENCO COMMON STOCK. At and after the Effective
Time, the Holder shall be deemed to have surrendered any and all rights under
the Warrant Agreement and Warrant to purchase Cryenco Common Stock.
6. CONSENT TO AMENDMENT. By the execution and delivery of this Amendment
No. 1, the Holder shall be deemed to have consented to the terms hereof in
accordance with the terms of the Warrant Agreement.
7. NO OTHER AMENDMENTS. Except as specifically provided herein or as
otherwise necessary or appropriate to effectuate the intent of this Amendment
No.1, the provisions of the Cryenco Warrant shall remain in full force and
effect without any alteration or modification thereto. Without limiting the
generality of the foregoing, the date of grant and the date of termination of
the Cryenco Warrant shall continue to be such dates as were in effect
immediately prior to the Effective Time.
8. SUCCESSORS AND ASSIGNS. This Agreement and all of the provisions
hereof shall be binding on and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
9. GOVERNING LAW. This Amendment No.1 shall be, and the Warrant Agreement
shall be amended to provide that it shall be, governed by and construed in
accordance with, the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
10. SEVERABILITY. If any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held to be invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
11. COUNTERPARTS. This Amendment No. 1 may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same instrument.
-3-
<PAGE> 4
IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of
the date first written above.
CHART INDUSTRIES, INC.
Attest: /s/ Suzanne Lines /s/ Don A. Baines
------------------------- -----------------------------
By: Don A. Baines
Title: CFO & Treasurer
MEZZZANINE CAPITAL CORPORATION
LIMITED (in liquidation)
Attest: /s/ Chris E. Lieberman
------------------------- -----------------------------
By: Chris E. Lieberman
Title: Attorney-In-Fact
CRYENCO SCIENCES, INC.
Attest: /s/ Steve M. Lutt /s/ James A. Raabe
------------------------- -----------------------------
By: James A. Raabe
Title: VP & CFO
-4-
<PAGE> 1
Exhibit 4.26
WARRANT AGREEMENT dated as of March 12, 1993 between CRYENCO SCIENCES,
INC., a Delaware corporation (the "Company"), and ALFRED SCHECHTER (the
"Holder").
1. GRANT. Subject to the terms of this Agreement, in consideration of $10 and
other good and valuable consideration the receipt and sufficiency of which is
hereby acknowledged by the Company, the Holder is hereby initially granted the
right to purchase, at any time and from time to time from March 12, 1993 until
5:30 p.m., Denver time, on March 11, 1998 (the "Exercise Period"), up to an
aggregate of 50,00 shares of Common Stock at an initial exercise price of
$7.90. The adjusted exercise price shall be the price which shall result from
time to time from any and all adjustments of the initial exercise price in
accordance with the provisions of SECTION 6 hereof. The term "Exercise Price"
herein shall mean the initial exercise price or the adjusted exercise price,
depending upon the context.
2. WARRANT CERTIFICATES. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall
be in the form set forth in Exhibit A, attached hereto and made a part hereof,
with such appropriate insertions, omissions, substitutions and other variations
as required or permitted by this Agreement.
3. EXERCISE OF WARRANTS. The Warrants initially are exercisable at the
Exercise Price (subject to adjustment as provided in SECTION 6 hereof) per
share of Common Stock, payable by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise
Price in cash, to instruct the Company in the form of subscription to retain,
in payment of the Exercise Price, a number of shares of Common Stock (the
"Payment Shares") equal to the quotient of (i) the Exercise Price multiplied by
the number of shares as to which the Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct the
number of Payment Shares from the shares to be delivered to the Holder.
"Average Closing Price" means, as of any date, (x) if shares of Common Stock
are listed on a national securities exchange, the average of the closing sales
prices therefor on the largest securities exchange on which such shares are
traded on the last ten (10) trading days before such date, (y) if such shares
are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last ten (10) trading days before the date
of exercise of the Warrants or (z) if such shares are not listed on either a
national securities exchange or the NASDAQ National Market System, the average
of the sales prices therefor on the last twenty (20) trading days before the
date of exercise of the Warrants. Upon surrender of a Warrant
-2-
<PAGE> 2
Certificate with the annexed Form of Election to Purchase duly executed,
together with payment of the Exercise Price for the shares of Common Stock at
the Company's principal offices (currently located at 5995 North Washington
Street, Denver, Colorado 80216), the Holder or any subsequent registered holder
or holders of a Warrant Certificate (any such subsequent holder or holders also
reference to herein as the "Holder" or "Holders") shall be entitled to receive
a certificate or certificates for the shares of Common Stock so purchased for
the Warrants so exercised. The purchase rights represented by each Warrant
Certificate are exercisable at the option of the Holder thereof, in whole or in
part (but not as to fractional shares of the Common Stock underlying the
Warrants). Warrants may be exercised to purchase all or part of the shares of
Common Stock represented thereby. In the case of the purchase of less than all
the securities purchasable under any Warrant Certificate, the Company shall
cancel said Warrant Certificate upon the surrender thereof and, unless the
Warrant has expired, shall execute and deliver a new Warrant Certificate of
like tenor for the balance of the securities purchasable thereunder. With
respect to any such exercise, the Holder shall for all purposes be deemed to
have become the holder of record of the number of shares of Common Stock
evidenced by such certificate or certificates from the date on which the
Warrant was surrendered and payment of the Exercise Price was made irrespective
of the date of delivery of such certificate, except that, if the date of such
surrender and payment is a date on which the stock transfer books of the
Company are closed, such person shall be deemed to have become the holder of
such shares at the close of business on the next succeeding date on which the
stock transfer books are open.
4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the
issuance of certificates for the shares of Common Stock shall be made forthwith
(and in any event within ten (10) business days thereafter) without charge to
the Holder thereof including, without limitation, any tax which may be payable
in respect of the issuance thereof, and such certificates shall (subject to the
provisions of SECTIONS 5 and 7 hereof) be issued in the name of, or in such
names as may be directed by, the Holder thereof; provided, however, that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any such certificates in
a name other than that of the Holder, and the Company shall not be required to
issue or deliver such certificates unless or until the person or persons
requesting the issuance thereof in a name other than that of the Holder 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-
<PAGE> 3
The Warrant Certificates and the certificates representing the shares of
Common Stock shall be executed on behalf of the Company by the manual or
facsimile signature of the then present Chairman or Vice Chairman of the Board
of Directors or President or Vice president of the Company under its corporate
seal reproduced thereon, attested to by the dual or facsimile signature of the
then present Secretary or Assistant Secretary of the Company. Warrant
Certificates shall be dated the date of execution by the Company upon initial
issuance, division, exchange, substitution or transfer.
5. RESTRICTION ON TRANSFER OF WARRANTS. There shall be not more than
five (5) Holders of record of Warrants. The Holder of a Warrant Certificate, by
his acceptance thereof, covenants and agrees that the Warrants may not be sold,
transferred, assigned, hypothecated or otherwise disposed of, in whole or in
part, except to or among the Holder, his spouse and the Holder's children, any
trust for the benefit of any such persons and any family foundations, who also
shall hold the Warrants subject to the restrictions contained in this SECTION
5. Certificates representing the Warrants shall bear a legend setting forth the
foregoing restriction.
6. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES.
6.1 COMPUTATION OF ADJUSTED EXERCISE PRICE. For the purposes of this
SECTION 6, the term Exercise Price shall mean the Exercise Price per share of
Common Stock set forth in SECTION 1 hereof, as adjusted from time to time
pursuant to the provisions of this SECTION 6.
6.2 EXERCISE PRICE ADJUSTMENTS. In case at the time of any advance under
the Funding Agreement dated as of March 12, 1993 (the "Funding Agreement"),
the average closing price of the Common Stock in the NASDAQ National Market
System on the ten (10) trading days immediately preceding such advance is less
than the Exercise Price, the Exercise Price shall be reduced and be equal to
such average closing price of the Common Stock on the ten (10) trading days
immediately preceding such subsequent advance.
6.3 SUBDIVISION AND COMBINATIONS. In case the Company shall at any time
subdivide (for example, a stock split or stock dividend) or combine (for
example, a reverse stock split) the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
-4-
<PAGE> 4
6.4 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this SECTION 6, the number of
securities issuable upon the exercise of each Warrant shall be adjusted to the
nearest full amount by multiplying a number equal to the Exercise Price in
effect immediately prior to such adjustment by the number of shares of Common
Stock (or other securities as provided in Section 5 hereof) issuable upon
exercise of the Warrants immediately prior to such adjustment and dividing the
product so obtained by the adjusted Exercise Price.
6.5 DEFINITION OF COMMON STOCK. For the purpose of this Agreement, the
term "Common Stock" shall mean (i) the class of stock designated as Class A
voting Common Stock, $.01 par value, in the Amended and Restated Certificate
of Incorporation of the Company as of the date hereof, (ii) the class of stock
designated as Class B non-voting Convertible Common Stock, $.01 par value, in
the Amended and Restated Certificate of Incorporation of the Company as of the
date hereof, (iii) any other capital stock of any class or classes (however
designated) of the Company the holders of which shall have the right, without
limitation as to amount, either to all or to a share of the balance of current
dividends and liquidating dividends after the payment of dividends and
distributions on any shares entitled to preference and (iv) any other
securities into which or for which any of the securities described in clauses
(i), (ii) or (iii) above have been converted, exchanged or combined pursuant
to a plan of recapitalization, reorganization, merger, sale of assets or
otherwise. In the event that the Company shall after the date hereof issue
securities with greater or superior voting rights than the shares of Common
Stock outstanding as of the date hereof, the Holder, at his or its option, may
receive upon exercise of any Warrant either shares of Common Stock or an equal
number of such securities with greater or superior voting rights.
6.6 MERGER OR CONSOLIDATION. If any capital reorganization or
reclassification of the capital stock of the Company or any consolidation,
merger or other transaction of the Company with another corporation in which
the Company is the surviving corporation, or the sale of all or substantially
all of the Company's assets to another corporation shall be effected in such a
way that holders of Common Stock shall be entitled to receive consideration
(including but not limited to stock, securities or assets) with respect to or
in exchange for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate
provisions shall be made whereby each Holder shall thereafter have the right
to receive upon the basis and upon the terms and conditions specified herein
and in lieu of the shares of Common Stock of the Company immediately
theretofore so
-5-
<PAGE> 5
receivable upon the exercise of each Warrant or Warrants, such shares of
stock, securities or assets (including cash) as may be issued or payable with
respect to or in exchange for a number of outstanding shares of such Common
Stock equal to the number of shares of such stock immediately theretofore so
receivable had such reorganization, reclassification, consolidation, merger or
sale not taken place, and in any such case appropriate provision shall be made
with respect to the rights and interests of such holder to the end that the
provisions hereof (including, without limitation, provisions for adjustments
of the Exercise Price) shall thereafter be applicable, as nearly as may be, in
relation to any shares of stock, securities or assets thereafter deliverable
upon the exercise of such exercise rights. In the event of a merger or
consolidation of the Company or other transaction in which the Company is not
the surviving corporation or in which, as the result of the transaction, no
trading market will exist for the Common Stock, the Company shall give notice
regarding the transaction in accordance with SECTION 12 as soon as practicable
(and in no event less than twenty (20) days prior to the record date fixed for
the transaction or, if none, the closing date for such transaction) in order
to afford the Holders the opportunity to exercise their Warrants and receive
after exercise the same consideration as is payable in the transaction to
other holders of Common Stock. This SECTION 6.6 shall similarly apply to
successive reorganizations, classifications, consolidations, mergers or other
transactions contemplated hereby.
6.7 NOTICE OF ADJUSTMENT. Upon any adjustment of the Exercise Price, the
Company shall give written notice thereof to each Holder in accordance with
Section 12, which notice shall state the Exercise Price resulting from such
adjustment, setting forth in reasonable detail the method of calculation and
the facts upon which such calculation is based.
7. REGISTRATION RIGHTS.
7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. The Warrants and the
shares of Common Stock have not been registered for sale under the Act. Upon
exercise of the Warrants, in part or in whole, certificates representing the
shares of Common Stock shall bear the following legend:
The securities represented by this certificate have not been registered
under the Securities Act of 1933, as amended ("Act"), and may not be
offered or sold except pursuant to (i) an effective registration
statement under the Act, (ii) to the extent applicable, Rule 144 under
the Act (or any similar rule under such Act relating to the disposition
of securities), or (iii) an opinion of counsel, if such
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<PAGE> 6
opinion shall be reasonably satisfactory to counsel to the issuer that
an exemption from registration under such Act is available.
7.2 PIGGYBACK REGISTRATION. (a) If, at any time commencing after the
date hereof through and including the fifth anniversary hereof the Company
proposes to register any of its securities under the Act (other than in
connection with a transaction contemplated by Rule 145(a) promulgated under
the Act or pursuant to Form S-8) it will give written notice by registered or
certified mail, at least fifteen (15) days prior to the filing of each such
registration statement, to the Holders of the Warrants of its intention to do
so. If the Holders of the Warrants notify the Company within fifteen (15) days
after receipt of any such notice of its or their desire to include Common
Stock underlying the Warrants in such proposed registration statement, the
Company shall afford the such Holders of the opportunity to have any such
Common Stock registered under such registration statement.
(b) In the case of an underwritten offering, if the managing underwriter
of the offering determines and advises the Company in writing that inclusion
of the Common Stock of the Holders requested to be included would interfere
with the successful offering of shares by the Company there shall be excluded
from such offering, to the extent that the managing underwriter deems
necessary, shares of Common Stock owned by the Holders on a PRO RATA basis.
7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In connection
with any registration under Section 7.2 hereof, the Company covenants and
agrees as follows:
(a) The Company shall pay all costs (excluding transfer taxes, if any,
and fees and expenses of Holder(s)' counsel and any underwriting or selling
commissions), fees and expenses in connection with all registration statements
filed pursuant to SECTION 7.2 hereof including, without limitation, the
Company's legal and accounting fees (including the costs and expenses of any
special audit or other procedures), printing expenses, blue sky fees and
expenses.
(b) The Company will take all necessary action which may be required in
qualifying or registering the Common Stock included in a registration
statement for offering and sale under the securities or blue sky laws of such
states as reasonably are requested by the Holder(s) provided, however, that
the number of states in which qualification or registration shall be required
shall not exceed five (5) and in no event shall the Company be required to
effect such qualification or registration if such act would require the
Company to qualify as a foreign
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<PAGE> 7
corporation or to file a general consent to service of process in any
jurisdiction where it is not now so qualified or required to file such a
consent.
(c) Upon any registration becoming effective pursuant to this SECTION 7,
the Company shall use its best efforts to: (i) keep such registration
statement current for a period of ninety (90) days; (ii) prepare and file with
the Commission such amendments and supplements to such registration statement
as may be necessary to comply with the provisions of the Act and the
Regulations of the Commission with respect to the disposition of all
securities covered by such registration statement; (iii) cause all the Common
Stock registered pursuant to such registration statement to be listed on each
exchange or automated quotation system on which the Common Stock is then
listed; (iv) provide a transfer agent and registrar for all stock registered
pursuant to such registration statement and CUSIP number for all such stock,
in each case not later than the effective date of such registration; and (v)
otherwise use its best efforts to comply with all applicable rules and
regulations of the Commission.
(d) The Company shall indemnify and hold harmless the Holder(s) of the
Common Stock to be sold pursuant to any registration statement and each
person, if any, who controls such Holders within the meaning of Section 15 of
the Act or Section 20(a) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), against and from all loss, claim, damage, expense or
liability (including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which any of them may
become subject under the Act, the Exchange Act or otherwise, arising from such
registration statement.
(e) The Holders of the Common Stock to be sold pursuant to a
registration statement, and its or their successors and assigns, shall
indemnify and hold harmless the Company, its officers and directors and each
person, if any, who controls the Company within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act, against and from all loss,
claim, damage, expense or liability (including all expenses reasonably
incurred in investigating, preparing or defending against any claim
whatsoever) to which they may become subject under the Act, the Exchange Act
or otherwise, arising from information furnished by or on behalf of such
Holders or its or their successors or assigns, for specific inclusion in such
registration statement.
(f) Any person entitled to indemnification under this SECTION 7 will (i)
give prompt written notice to the indemnifying party of any claim with respect
to which it seeks
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<PAGE> 8
indemnification 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 will
not be subject to any liability for any settlement made by the indemnified
party without its consent (but such consent will not be unreasonably withheld).
An indemnifying party who is not entitled to, or elects not to, assume the
defense of a claim will 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.
(g) Nothing contained in this Agreement shall be construed as requiring
the Holder to exercise his or its Warrants prior to the initial filing of any
registration statement or the effectiveness thereof.
(h) The Company at its expense shall deliver promptly to each Holder
participating in the offering and requesting the correspondence and memoranda
described below copies of all documents proposed to be filed with the
Commission, all correspondence between the Commission and the Company, its
counsel or auditors, and all memoranda relating to discussions with the
Commission or its staff with respect to the registration statement and permit
each such Holder at its expense to do such investigation, upon reasonable
advance notice, with respect to information contained in or omitted from the
registration statement as it deems reasonably necessary to comply with
applicable securities laws or rules of the National Association of Securities
Dealers, Inc. ("NASD"). Such investigation shall include access to books,
records and properties and opportunities to discuss the business of the
Company with its officers and independent auditors, all to such reasonable
extent and at such reasonable times and as often as any such Holder shall
reasonably request.
8. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of securities in such denominations as shall
be designated by the Holder thereof at the time of such surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation
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<PAGE> 9
of any Warrant Certificate, and, in case of loss, theft or destruction, of
indemnity or security reasonably satisfactory to it, and reimbursement to the
Company of all reasonable expenses incidental thereto, and upon surrender and
cancellation of the Warrant Certificate, if mutilated, the Company will make
and deliver a new Warrant Certificate of like tenor, in lieu thereof.
9. ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be
required to issue certificates representing fractions of shares of Common
Stock upon the exercise of the Warrants, nor shall it be required to issue
scrip or pay cash in lieu of fractional interests, it being the intent of the
parties that all fractional interests shall be eliminated by rounding any
fraction up to the nearest whole number of shares of Common Stock or other
securities, properties or rights.
10. RESERVATION AND LISTING. The Company shall at times have and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon the exercise of the Warrants, such number of shares of Common
Stock or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants, and payment of the respective exercise price therefor, all shares of
Common Stock and other securities issuable upon such exercise shall, at the
time of delivery thereof, be duly and validly issued, fully paid,
nonassessable, not subject to the preemptive rights of any stockholder and
free from all taxes, liens and charges with respect to the issue thereof. The
Company will take all such action as may be necessary to ensure that all such
shares of Common Stock may be so issued without violation of any applicable
law or regulation, or of any requirements of any national securities exchange
upon which the Common Stock of the Company may be listed. The Company will not
take any action which results in any adjustment of the Exercise Price if the
total number of shares of Common Stock issued and issuable after such action
upon exercise of the Warrants would exceed the total number of shares of
Common Stock then authorized by the Company's Amended and Restated Certificate
of Incorporation. The Company has not granted and will not grant any right of
first refusal with respect to shares issuable upon exercise of the Warrants,
and there are no preemptive rights associated with such shares. As long as the
Warrants shall be outstanding, the Company shall use its best efforts to cause
all shares of Common Stock issuable upon the exercise of the Warrants to be
listed (subject to official notice of issuance) on all securities exchanges,
if any, on which the Common Stock issued to the public in connection herewith
may then be listed and/or quoted on NASDAQ.
11. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement
shall be construed as conferring upon the Holders the right to vote or to
consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the
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<PAGE> 10
election of directors or any other matter, or as having any rights whatsoever
as a stockholder of the Company. If, however, at any time prior to the
expiration of the Warrants and their exercise, any of the following events
shall occur:
(a) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to
receive a dividend or distribution payable otherwise than in cash,
or a cash dividend or distribution payable otherwise than out of
current or retained earnings, as indicated by the accounting
treatment of such dividend or distribution on the books of the
Company; or
(b) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or exchangeable for shares of capital
stock of the Company, or any option, right or warrant to subscribe
therefor; or
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a
sale of all or substantially all of its property, assets and
business as an entity shall be proposed
then, in any one or more of said events, the Company shall give written notice
of such event at least fifteen (15) days prior to the date fixed as a record
date or the date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution, convertible or
exchangeable securities or subscription rights, or entitled to vote on such
proposed dissolution, liquidation, winding up or sale. Such notice shall
specify such record date or the date of closing the transfer books, as the
case may be. Failure to give such notice or any defect therein shall not
affect the validity of any action taken in connection with the declaration or
payment of any such dividend, or the issuance of any convertible or
exchangeable securities, or subscription rights, options or warrants, or any
proposed dissolution, liquidation, winding up or sale.
12. NOTICES.
All notices, requests, consents and other communications hereunder
shall be in writing and shall be deemed to have been duly made when delivered,
or mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
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<PAGE> 11
(b) If to the Company, to the address set forth in SECTION 3
hereof or to such other address as the Company may designate by notice
to the Holders.
13. SUPPLEMENTS AND AMENDMENTS. The Company and the Holder may from
time to time supplement or amend this Agreement without the approval of any
subsequent Holders of Warrant Certificates (other than the Holder) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with provisions herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which the Company
and the Holder deem shall not adversely affect the interests of the Holders of
Warrant Certificates.
14. SUCCESSORS. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit the Company, the Holders and
their respective successors assigns hereunder.
15. This Agreement shall terminate at the close of business on March
11, 1998. Notwithstanding the foregoing, the indemnification provisions of
SECTION 7 shall survive such termination until the close of business on March
11, 2001.
16. GOVERNING LAW: SUBMISSION TO JURISDICTION. This Agreement and each
Warrant Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be
construed in accordance with the laws of said State without giving effect to
the rules of said State governing the conflicts of laws.
The Company, the representative and the Holders hereby agree that any
action, proceeding or claim against it arising out of, or relating in any way
to, this Agreement shall be brought and enforced in the courts of the state of
New York or of the United States of America for the Southern District of New
York, and irrevocably submits to such jurisdiction, which jurisdiction shall
be exclusive. The Company, the Representative and the Holders hereby
irrevocably waive any objection to such exclusive jurisdiction or inconvenient
forum. Any such process or summons to be served upon any of the Company, the
representative and the Holders (at the option of the party bringing such
action, proceeding or claim) may be served by transmitting a copy thereof, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in SECTION 12 hereof. Such mailing
shall be deemed personal service and shall be legal and binding upon the party
so served in any action, proceeding or claim.
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<PAGE> 12
17. ENTIRE AGREEMENT; MODIFICATION. This Agreement (including the
Funding Agreement to the extent portions thereof are referred to herein)
contain the entire understanding between the parties hereto with respect to
the subject matter hereof and may not be modified or amended except by a
writing duly signed by the party against whom enforcement of the modification
or amendment is sought.
18. SEVERABILITY. If any provision of this amendment shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
19. CAPTIONS. the caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive effect.
20. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation other than the company and the
Holder and any subsequent registered Holder(s) of the Warrant Certificates or
Warants any legal or equitable right, remedy or claim under this Agreement;
and this Agreement shall be for the sole and exclusive benefit of the company
and the Holder and subsequent Holder(s) of the Warrant Certificates or
Warrants.
21. COUNTERPARTS. This Agreement may be executed any in number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts ahll together constitute but one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement be duly
executed, as of the day and year first above written.
CRYENCO SCIENCES, INC.
By: /s/ Don M. Harwell
--------------------------
Name: Don M. Harwell
Title: Vice President
Attest:
/s/ Alison A. Murray
- -------------------------
Name: Alison A. Murray
Title: Secretary
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<PAGE> 13
EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, March __, 1998
No. W-1993__ _______ Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that ________________, or
registered assigns, is the registered holder of ______ Warrants to purchase
initially, at any time from March __, 1993 until 5:30 p.m. Denver time on March
__, 1998 ("Expiration Date"), up to ______ shares of Class A voting common
stock, $.01 par value ("Common Stock") of CRYENCO SCIENCES, INC., a Delaware
corporation (the "Company"), at the price per share of Common Stock equal to
the Exercise Price set forth in the Warrant Agreement dated as of March ___,
1993 between the Company and ____________ (the "Warrant Agreement"), upon
surrender of this Warrant Certificate and payment of the Exercise Price at an
office or agency of the Company, but subject to the conditions set forth
herein and in the Warrant Agreement. Payment of the Exercise Price shall be
made by certified or official bank cashier's check payable to the order of the
Company; provided, however, that the holder hereof shall have the right, at
his or its election, in lieu of delivering the Exercise Price in cash, to
instruct the Company in the form of subscription to retain, in payment of the
Exercise Price, a number of shares of Common Stock (the "Payment Shares")
equal to the quotient of (i) the Exercise Price multiplied by the number of
shares as to which this Warrant is then being exercised divided by (ii) the
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<PAGE> 14
"Average Closing Price" as of the date of exercise and to deduct the number of
Payment Shares from the shares to be delivered to the holder hereof. "Average
Closing Price" means, as of any date, (x) if shares of Common Stock are listed
on a national securities exchange, the average of the closing sales prices
therefor on the largest securities exchange on which such shares are traded on
the last ten (10) trading days before such date, (y) if such shares are listed
on the NASDAQ National Market System but not on any national securities
exchange, the average of the closing sales prices therefor on the NASDAQ
National Market System on the last ten (10) trading days before the date of
the exercise of the Warrants or (z) if such shares are not listed on either a
national securities exchange or the NASDAQ National Market System, the average
of the sales prices therefor on the last twenty (20) trading days before the
date of the exercise of the Warrants.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, hereby shall thereafter be void.
The Warrants evidenced by thIs Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which
is hereby incorporated by reference in and made a part of this instrument and
is hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders or "holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
provided, however, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the holder as set forth in the Warrant Agreement to purchase the
number of shares for the exercise price as so adjusted or any other rights set
forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate
or Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in
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<PAGE> 15
the Warrant Agreement, without any charge except for any tax or other
governmental charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Dated as of March __, 1993
CRYENCO SCIENCES, INC.
[SEAL] By:__________________________________
Name:
Title:
Attest:
_____________________________
Name:
Title:
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<PAGE> 16
FORM OF ELECTION TO PURCHASE
TO: Cryenco Sciences, Inc.
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
__________ shares of Class A voting Common Stock;
and herewith [tenders in payment for such securities a certified or
official bank cashier's check payable to the order of CRYENCO SCIENCES, INC.
in the amount of $________ therefor] [instructs you herein, in payment of the
Exercise Price, to deduct ______ shares of Class A voting Common Stock and to
deliver the net number of shares, being ____ shares of Class A voting Common
Stock]. The undersigned requests that a certificate for such securities be
registered in the name of ______________ whose address is
______________________ and that such Certificate be delivered to
_______________________ whose address is __________________.
Dated: Signature:__________________________
(Signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate.)
(Insert Social Security or Other
Identifying Number of Holder)
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<PAGE> 17
FORM OF ASSIGNMENT
(To be exercised by the registered holder if
such holder desires to transfer the Warrant Certificate
to the extent permitted by Section 5 of the Warrant Agreement.)
FOR VALUE RECEIVED
hereby sells, assigns and transfers unto
(Please print name and address of transferee)
this Warrant Certificate; together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _____________ Attorney, to
transfer the within Warrant Certificate on the books of the within-named
Company, with full power of substitution.
Dated: Signature: ____________________________
(signature must conform in all respects
to name of holder as specified on the
face of the Warrant Certificate.)
(Insert Social Security or Other
Identifying Number of Assignee)
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<PAGE> 1
Exhibit 4.27
WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, March 11, 1998
No. W-1993A 50,000 Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that Alfred Schechter, or
registered assigns, is the registered holder of 50,000 Warrants to purchase
initially, at any time from March 12, 1993 until 5:30 p.m. Denver time on
March 11, 1998 ("Expiration Date"), up to 50,000 shares of Class A voting
common stock, $.01 par value ("Common Stock") of CRYENCO SCIENCES, INC., a
Delaware corporation (the "Company"), at the price per share of Common Stock
equal to the Exercise Price set forth in the Warrant Agreement dated as of
March 12, 1993 between the Company and Alfred Schechter (the "Warrant
Agreement"), upon surrender of this Warrant Certificate and payment of the
Exercise Price at an office or agency of the Company, but subject to the
conditions set forth herein and in the Warrant Agreement. Payment of the
Exercise Price shall be made by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the holder hereof
shall have the right, at his or its election, in lieu of delivering the
Exercise Price in cash, to instruct the Company in the form of subscription to
retain, in payment of the Exercise Price, a number of shares of Common Stock
(the "Payment Shares") equal to the quotient of (i) the Exercise Price
multiplied by the number of shares as to which this Warrant is then being
exercised divided by (ii) the "Average Closing Price" as of the date of
exercise and to deduct the number of Payment Shares from the shares to be
delivered to
<PAGE> 2
the holder hereof. "Average Closing Price" means, as of any date, (x) if shares
of Common Stock are listed on a national securities exchange, the average of the
closing sales prices therefor on the largest securities exchange on which such
shares are traded on the last ten (10) trading days before such date, (y) if
such shares are listed on the NASDAQ National Market System but not on any
national securities exchange, the average of the closing sales prices therefor
on the NASDAQ National Market System on the last ten (10) trading days before
the date of the exercise of the Warrants or (z) if such shares are not listed on
either a national securities exchange or the NASDAQ National Market System, the
average of the sales prices therefor on the last twenty (20) trading days before
the date of the exercise of the Warrants.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, hereby shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the holders
(the words "holders or "holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; provided,
however, that the failure of the Company to issue such new Warrant Certificates
shall not in any way change, alter, or otherwise impair, the rights of the
holder as set forth in the Warrant Agreement to purchase the number of shares
for the exercise price as so adjusted or any other rights set forth in the
Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
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<PAGE> 3
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof , and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Dated as of March 12, 1993
CRYENCO SCIENCES, INC.
[SEAL] By: /s/ Don M. Harwell
----------------------------
Name: Don M. Harwell
Title: Vice President
Attest:
/s/ Alison A. Murray
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Name: Alison A. Murray
Title: Secretary
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Exhibit 4.28
WARRANT AGREEMENT
WARRANT AGREEMENT dated as of January 26, 1995 between CRYENCO SCIENCES,
INC., a Delaware corporation (the "Company"), and Alfred Schechter (the
"Holder").
1. GRANT. Subject to the terms of this Agreement, in consideration of
$10.00 and other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged by the Company, the Holder is hereby initially
granted the right to purchase, at any time and from time to time from January
26, 1995 until 5:30 p.m., Denver time on January 25, 2000 (the "Exercise
Period"), up to an aggregate of 25,000 shares of Common Stock at an initial
exercise price of $3.55. The adjusted exercise price shall be the price which
shall result from time to time from any and all adjustments of the initial
exercise price, in accordance with the provisions of Section 6 hereof. The term
"Exercise Price" herein shall mean the initial exercise price, as applicable
based on the date of exercise, or the adjusted exercise price, depending upon
the context.
2. WARRANT CERTIFICATES. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall
be in the form set forth in Exhibit A, attached hereto and made a part hereof,
with such appropriate insertions, omissions, substitutions and other variations
as required or permitted by this Agreement.
3. EXERCISE OF WARRANTS. The Warrants initially are exercisable at the
Exercise Price (subject to adjustment as provided in SECTION 6 hereof) per
share of Common Stock, payable by certified or official bank cashier's check
payable to the order of the Company; PROVIDED, HOWEVER, that the Holder shall
have the right, at his or its election, in lieu of delivering the Exercise
Price in cash, to instruct the Company in the form of subscription to retain,
in payment of the Exercise Price, a number of shares of Common Stock (the
"Payment Shares") equal to the quotient of (i) the Exercise Price multiplied by
the number of shares as to which the Warrant is then being exercised divided by
(ii) the "Average Closing Price" as of the date of exercise and to deduct the
number of Payment Shares from the shares to be delivered to the Holder.
"Average Closing Price" means, as of any date, (x) if shares of Common Stock
are listed on a national securities exchange, the average of the closing sales
prices therefor on the largest securities exchange on which such shares are
traded on the last 10 trading days before such date, (y) if such shares are
listed on the NASDAQ National Market System but not on any national securities
exchange, the average of the closing sales prices therefor on the NASDAQ
National Market System on the last 10 trading days before such date or (z) if
such shares are not listed on either a national securities exchange or the
NASDAQ National Market System, the average of the sales prices therefor on the
last 20 trading days before such date. Upon surrender of a Warrant Certificate
with the annexed Form of Election to Purchase duly executed, together with
payment of the Exercise Price for the shares of Common Stock at the Company's
principal offices (currently located at 3811 Joliet Street, Denver, Colorado
80239), the Holder or any subsequent registered holder or holders of a Warrant
Certificate (any such subsequent holder or holders also referred to herein as
the "Holder" or "Holders") shall be entitled to receive a
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certificate or certificates for the shares of Common Stock so purchased for the
Warrants so exercised. The purchase rights represented by each Warrant
Certificate are exercisable at the option of the Holder thereof, in whole or in
part (but not as to fractional shares of the Common Stock underlying the
Warrants). Warrants may be exercised to purchase all or part of the shares of
Common Stock represented thereby. In the case of the purchase of less than all
the securities purchasable under any Warrant Certificate, the Company shall
cancel said Warrant Certificate upon the surrender thereof and, unless the
Warrant has expired, shall execute and deliver a new Warrant Certificate of
like tenor for the balance of the securities purchasable thereunder. With
respect to any such exercise, the Holder shall for all purposes be deemed to
have become the holder of record of the number of shares of Common Stock from
the date on which the Warrant was surrendered and payment of the Exercise Price
was made irrespective of the date of delivery of such shares, except that, if
the date of such surrender and payment is a date on which the stock transfer
books of the Company are closed, such person shall be deemed to have become the
holder of such shares at the close of business on the next succeeding date on
which the stock transfer books are open.
4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the
issuance of certificates for the shares of Common Stock shall be made forthwith
(and in any event within 10 business days thereafter) without charge to the
Holder thereof including, without limitation, any tax which may be payable in
respect of the issuance thereof, and such certificates shall (subject to the
provisions of SECTIONS 5 and 7 hereof) be issued in the name of, or in such
names as may be directed by, the Holder thereof; provided, however, that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any such certificates in
a name other than that of the Holder and the Company shall not be required to
issue or deliver such certificates unless or until the person or persons
requiring the issuance thereof in a name other than that of the Holder 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.
The Warrant Certificates and the certificates representing the shares
of Common Stock shall be executed on behalf of the Company by the manual or
facsimile signature of the then present Chairman or Vice Chairman of the Board
of Directors or President or Vice President of the Company under its corporate
seal reproduced thereon, attested to by the dual or facsimile signature of the
then present Secretary or Assistant Secretary of the Company. Warrant
Certificates shall be dated the date of execution by the Company upon initial
issuance, division, exchange, substitution or transfer.
5. RESTRICTION ON TRANSFER OF WARRANTS.
There shall be not more than five (5) Holders of record of the Warrants.
The Holder of a Warrant Certificate, by his or its acceptance thereof, covenants
and agrees that the Warrants may not be sold, transferred, assigned,
hypothecated or otherwise disposed of, in whole or in part, except to or among
the Holder, his spouse and the Holder's children, any trust
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for the benefit of any such persons and any family foundations, who also shall
hold the warrants subject to the restrictions contained in this Section 5.
6. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES.
6.1 COMPUTATION OF ADJUSTED EXERCISE PRICE. For the purposes of this
SECTION 6, the term Exercise Price shall mean the Exercise Price per share of
Common Stock set forth in SECTION 1 hereof, as adjusted from time to time
pursuant to the provisions of this SECTION 6.
6.2 SUBDIVISION AND COMBINATIONS. In case the Company shall at any
time subdivide (for example, a stock split or stock dividend) or combine (for
example, a reverse stock split) the outstanding shares of Common Stock, the
Exercise Price shall forthwith be proportionately decreased in the case of
subdivision or increased in the case of combination.
6.3 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this SECTION 6, the number of
securities issuable upon the exercise of each Warrant shall be adjusted to the
nearest full share by multiplying a number equal to the Exercise Price in
effect immediately prior to such adjustment by the number of shares of Common
Stock (or other securities as provided in this SECTION 6) issuable upon
exercise of the Warrants immediately prior to such adjustment and dividing the
product so obtained by the adjusted Exercise Price.
6.4 DEFINITION OF COMMON STOCK. For the purpose of this Agreement, the
term "Common Stock" shall mean (i) the class of stock designated as Class A
Voting Common Stock, $.0l par value, in the Restated Certificate of
Incorporation of the Company as of the date hereof, (ii) the class of stock
designated as Class B non-voting Convertible Common Stock, $.0l par value, in
the Restated Certificate of Incorporation, as amended, of the Company as of
the date hereof, (iii) any other capital stock of any class or classes
(however designated) of the Company the holders of which shall have the right,
without limitation as to amount, either to all or to a share of the balance of
current dividends and distributions on any shares entitled to preference
except the Series A Preferred Stock of the Company and (iv) any other
securities into which or for which any of the securities described in clauses
(i), (ii) or (iii) above have been converted, exchanged or combined pursuant
to a plan of recapitalization, reorganization, merger, sale of assets or
otherwise. In the event that the Company shall after the date hereof issue
securities with greater or superior voting rights than the shares of Common
Stock outstanding as of the date hereof, the Holder, at his or its option, may
receive upon exercise of any Warrant either shares of Common Stock or an equal
number of such securities with greater or superior voting rights.
6.5 MERGER OR CONSOLIDATION. If any capital reorganization or
reclassification of the capital stock of the Company or any consolidation,
merger or other transaction of the Company with another corporation in which
the Company is the surviving corporation, or the sale of all or substantially
all of the Company's assets to another corporation shall be effected in such a
way that holders of Common Stock shall be entitled to receive consideration
(including
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but not limited to stock, securities or assets) with respect to or in exchange
for Common Stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate
provisions shall be made whereby each Holder shall thereafter have the right
to receive upon the basis and upon the terms and conditions specified herein
and in lieu of the shares of Common Stock of the Company immediately
theretofore so receivable upon the exercise of each Warrant or Warrants, such
shares of stock, securities or assets (including cash) as may be issued or
payable with respect to or in exchange for a number of outstanding shares of
such Common Stock equal to the number of shares of such stock immediately
theretofore so receivable had such reorganization, reclassification,
consolidation, merger or sale not taken place, and in any such case
appropriate provision shall be made with respect to the rights and interests
of such Holder to the end that the provisions hereof (including, without
limitation, provisions for adjustments of the Exercise Price) shall thereafter
be applicable, as nearly as may be, in relation to any shares of stock,
securities or assets thereafter deliverable upon the exercise of such rights.
In the event of a merger or consolidation of the Company or other transaction
in which the Company is not the surviving corporation or in which, as the
result of the transaction, no trading market will exist for the Common Stock,
the Company shall give notice regarding the transaction in accordance with
SECTION 12 hereof as soon as practicable (and in no event less than 20 days
prior to the record date fixed for the transaction or, if none, the closing
date for such transaction) in order to afford the Holders the opportunity to
exercise their Warrants and receive after exercise the same consideration
payable in the transaction to other holders of Common Stock. This SECTION 6.5
shall similarly apply to successive reorganizations, classifications,
consolidations, mergers or other transaction contemplated hereby.
6.6 NOTICE OF ADJUSTMENT. Upon any adjustment of the Exercise Price,
the Company shall give written notice thereof to each Holder in accordance
with SECTION 12 hereof, which notice shall state the Exercise Price resulting
from such adjustment, setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based.
7. REGISTRATION RIGHTS.
7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. The Warrants and
the shares of Common Stock have not been registered for sale under the Act.
Upon exercise of the Warrants, in part or in whole, certificates representing
the shares of Common Stock shall bear the following legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended ("Act"), and
may not be offered or sold except pursuant to (i) an effective
registration statement under the Act, (ii) to the extent applicable,
Rule 144 under the Act (or any similar rule under such Act relating to
the disposition of securities), or (iii) an opinion of counsel, if
such opinion shall be reasonably satisfactory to counsel to the issuer
that an exemption from registration under such Act is available.
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7.2 PIGGYBACK REGISTRATION.
(a) If, at any time commencing after the date hereof through
and including the fifth anniversary hereof the Company proposes to
register any of its equity securities under the Act (other than in
connection with a transaction contemplated by Rule 145(a) promulgated
under the Act or pursuant to Form S-8 or S-4 or successor forms) it
will give written notice by registered or certified mail, at least 15
days prior to the filing of each such registration statement, to the
Holders of the Warrants of its intention to do so. If the Holders of
the Warrants notify the Company within 15 days after receipt of any
such notice of its or their desire to include Common Stock underlying
the Warrants in such proposed registration statement, the Company
shall afford such Holders of the opportunity to have any such Common
Stock registered under such registration statement.
(b) In the case of an underwritten offering, if the managing
underwriter of the offering determines and advises the Company in
writing that inclusion of the Common Stock of the Holders requested to
be included would interfere with the successful offering of shares by
the Company there shall be excluded from such offering, to the extent
that the managing underwriter deems necessary, shares of Common Stock
owned by the Holders on a PRO RATA basis.
(c) Notwithstanding anything to the contrary herein, any
registration rights hereunder shall not be exercisable at any time or
with respect to any proposed registration unless each of Chemical Bank
and The CIT Group/Equity Investments, Inc. shall have exercised to the
fullest extent permitted by the applicable agreement with the Company
or waived any registration rights held by either of them at such time
or in connection with such registration.
7.3 COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. In
connection with any registration under SECTION 7.2 hereof, the Company
covenants and agrees as follows:
(a) The Company shall pay all reasonable costs (excluding
transfer taxes, if any, and fees and expenses of Holder(s)' counsel
and any underwriting or selling commissions), fees and expenses in
connection with all registration statements filed pursuant to SECTION
7.2 hereof including, without limitation, the Company's legal and
accounting fees (including the costs and expenses of any special audit
or other procedures), printing expenses, blue sky fees and expenses.
(b) The Company will take all necessary action which may be
required in qualifying or registering the Common Stock included in a
registration statement for offering and sale under the securities or
blue sky laws of such states as reasonably are requested by the
Holder(s) provided, however, that the number of states in which
qualification or registration shall be required shall not exceed five
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(5) and in no event shall the Company be required to effect such
qualification or registration if such act would require the Company to
qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction where it is not now so
qualified or required to file such a consent.
(c) Upon any registration becoming effective pursuant to this
SECTION 7, the Company shall use its best efforts to: (i) keep such
registration statement current for a period of 90 days; (ii) prepare
and file with the Securities and Exchange Commission (the
"Commission") such amendments and supplements to such registration
statement as may be necessary to comply with the provisions of the Act
and the Regulations of the Commission with respect to the disposition
of all securities covered by such registration statement; (iii) cause
all the Common Stock registered pursuant to such registration
statement to be listed on each exchange or automated quotation system
on which the Common Stock is then listed; (iv) provide a transfer
agent and registrar for all stock registered pursuant to such
registration statement and CUSIP number for all such stock, in each
case not later than the effective date of such registration; and (v)
otherwise use its best efforts to comply with all applicable rules and
regulations of the Commission.
(d) The Company shall indemnify and hold harmless the
Holder(s) of the Common Stock to be sold pursuant to any registration
statement and each person, if any, who controls such Holders within
the meaning of Section 15 of the Act or Section 20(a) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
against and from all loss, claim, damage, expense or liability
(including all expenses reasonably incurred in investigating,
preparing or defending against any claim whatsoever) to which any of
them may become subject under the Act, the Exchange Act or otherwise,
arising from such registration statement, except such matters in
respect of which such Holders are required to indemnify the Company
under the next succeeding paragraph.
(e) The Holders of the Common Stock to be sold pursuant to a
registration statement, and its or their successors and assigns, shall
indemnify and hold harmless the Company, its officers and directors
and each person, if any, who controls the Company within the meaning
of Section 15 of the Act or Section 20(a) of the Exchange Act, against
and from all loss, claim, damage, expense or liability (including all
expenses reasonably incurred in investigating, preparing or defending
against any claim whatsoever) to which they may become subject under
the Act, the Exchange Act or otherwise, arising from information
furnished by or on behalf of such Holders or its or their successors
or assigns, for specific inclusion in such registration statement.
(f) Any person entitled to indemnification under this SECTION
7 will (i) give prompt written notice to the indemnifying party of any
claim with respect to which it seeks indemnification and (ii) unless
in such indemnified party's
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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 will not be subject to any
liability for any settlement made by the indemnified party without its
consent (but such consent will not be unreasonably withheld). An
indemnifying party who is not entitled to, or elects not to, assume
the defense of a claim will 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.
(g) Nothing contained in this Agreement shall be construed as
requiring the Holder to exercise his or its Warrants prior to the
initial filing of any registration statement or the effectiveness
thereof.
(h) The Company at its expense shall deliver promptly to each
Holder participating in the offering and requesting the correspondence
and memoranda described below copies of all documents proposed to be
filed with the Commission, all correspondence between the Commission
and the Company, its counsel or auditors, and all memoranda relating
to the registration statement and permit each such Holder at its
expense to do such investigation, upon reasonable advance notice, with
respect to information contained in or omitted from the registration
statement as it deems reasonably necessary to comply with applicable
securities laws or rules of the National Association of Securities
Dealers, Inc. Such investigation shall include access to books,
records and properties and opportunities to discuss the business of
the Company with its officers and independent auditors, all to such
reasonable extent and at such reasonable times and as often as any
such Holder shall reasonably request.
8. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of securities in such denominations as shall
be designated by the Holder thereof at the time of such surrender, subject to
the provisions of Section 5 hereof.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction or mutilation of any Warrant Certificate, and,
in case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable
expenses incidental thereto, and upon surrender and cancellation of the
Warrant Certificate, if mutilated, the Company will make and deliver a new
Warrant Certificate of like tenor, in lieu thereof.
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9. ELIMINATION OF FRACTIONAL INTERESTS. The Company shall not be
required to issue certificates representing fractions of shares of Common
Stock upon the exercise of the Warrants, nor shall it be required to issue
scrip or pay cash in lieu of fractional interests, it being the intent of the
parties that all fractional interests shall be eliminated by rounding any
fraction up to the nearest whole number of shares of Common Stock or other
securities, properties or rights.
10. RESERVATION AND LISTING. The Company shall at times have and keep
available out of its authorized shares of Common Stock, solely for the purpose
of issuance upon the exercise of the Warrants, such number of shares of Common
Stock or other securities, properties or rights as shall be issuable upon the
exercise thereof. The Company covenants and agrees that, upon exercise of the
Warrants, and payment of the respective exercise price therefor, all shares of
Common Stock and other securities issuable upon such exercise shall, at the
time of delivery thereof, be duly and validly issued, fully paid,
nonassessable, not subject to the preemptive rights of any stockholder and
free from all taxes, liens and charges with respect to the issue thereof. The
Company will take all such action as may be necessary to ensure that all such
shares of Common Stock may be so issued without violation of any applicable
law or regulation, or of any requirements of any national securities exchange
upon which the Common Stock of the Company may be listed. The Company will not
take any action which results in any adjustment of the Exercise Price if the
total number of shares of Common Stock issued and issuable after such action
upon exercise of the Warrants would exceed the total number of shares of
Common Stock then authorized by the Company's Restated Certificate of
Incorporation. The Company has not granted and will not grant any right of
first refusal with respect to shares issuable upon exercise of the Warrants,
and there are no preemptive rights associated with such shares. As long as the
Warrants shall be outstanding, the Company shall use its best efforts to cause
all shares of Common Stock issuable upon exercise of the Warrants to be listed
(subject to official notice of issuance) on all securities exchanges, if any,
on which the Common Stock issued to the public in connection herewith may then
be listed and/or quoted on NASDAQ.
11. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement
shall be construed as conferring upon the Holders the right to vote or to
consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having
any rights whatsoever as a stockholder of the Company. If, however, at any
time prior to the expiration of the Warrants and their exercise, any of the
following events shall occur:
(a) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive a
dividend or distribution payable otherwise than in cash, or a cash
dividend or distribution payable otherwise than out of current or
retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
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(b) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or exchangeable for shares of capital
stock of the Company, or any option, right or warrant to subscribe
therefor; or
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets and business as an
entity shall be proposed
then, in any one or more of said events, the Company shall give written notice
of such event at least 15 days prior to the date fixed as a record date or the
date of closing the transfer books for the determination of the stockholder
entitled to such dividend, distribution, convertible or exchangeable
securities or subscription rights, or entitled to vote on such proposed
dissolution, liquidation, winding up or sale. Such notice shall specify such
record date or the date of closing the transfer books, as the case may be.
Failure to give such notice or any defect therein shall not affect the
validity of any action taken in connection with the declaration or payment of
any such dividend, or the issuance of any convertible or exchangeable
securities or subscription rights, options or warrants or any proposed
dissolution, liquidation, winding up or sale.
12. NOTICES.
All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been duly made when
delivered, or mailed by registered or certified mail, return receipt
requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in SECTION 3
hereof or to such other address as the Company may designate by
notice to the Holders.
13. SUPPLEMENTS AND AMENDMENTS. The Company and the Holder may from
time to time supplement or amend this Agreement without the approval of any
subsequent Holders of Warrant Certificates (other than the Holder) in order to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with provisions herein, or to make any
other provisions in regard to matters or questions arising hereunder which the
Company and the Holder may deem necessary or desirable and which the Company
and the Holder deem shall not adversely affect the interests of the Holders of
Warrant Certificates.
14. SUCCESSORS. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit of the Company, the Holders,
the limited partners of the Holder and their respective successors and assigns
hereunder.
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15. TERMINATION. This Agreement shall terminate at the close of
business on January 25, 2000. Notwithstanding the foregoing, the
indemnification provisions of SECTION 7 shall survive such termination until
the close of business on January 25, 2003.
16. GOVERNING LAW: SUBMISSION TO JURISDICTION. This Agreement and
each Warrant Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of Delaware and for all purposes shall be
construed in accordance with the laws of said State without giving effect to
the rules of said State governing the conflicts of laws.
The Company and the Holders hereby agree that any action, proceeding
or claim against it arising out of, or relating in any way to, this Agreement
shall be brought and enforced in the courts of the state of New York or of the
United States of America for the Southern District of New York, and
irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive. The Company and the Holders hereby irrevocably waive any objection
to such exclusive jurisdiction or inconvenient forum. Any such process or
summons to be served upon any of the Company and the Holders (at the option of
the party bringing such action, proceeding or claim) may be served by
transmitting a copy thereof, by registered or certified mail, return receipt
requested, postage prepaid, addressed to it at the address set forth in
SECTION 12 hereof. Such mailing shall be deemed personal service and shall be
legal and binding upon the party so served in any action, proceeding or claim.
17. ENTIRE AGREEMENT; MODIFICATION. This Agreement contains the
entire understanding between the parties hereto with respect to the subject
matter hereof and may not be modified or amended except by a writing duly
signed by the party against whom enforcement of the modification or amendment
is sought.
18. SEVERABILITY. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
19. CAPTIONS. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive
effect.
20. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Holder and any subsequent registered Holder(s) of the Warrant Certificates or
Warrants any legal or equitable right, remedy or claim under this Agreement;
and this Agreement shall be for the sole and exclusive benefit of the Company
and the Holder and subsequent Holder(s) of the Warrant Certificates or
Warrants.
21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and
the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
CRYENCO SCIENCES, INC.
By: /s/ Don M. Harwell
-----------------------------
Name: Don M. Harwell
Title: Vice President
Attest:
/s/ Alison A. Murray
- ------------------------
Name: Alison A. Murray
Title: Secretary
/s/ Alfred Schechter
---------------------------------
Alfred Schechter
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EXHIBIT A
FORM OF WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, ___________, 2000
No. W-1995(A)______ ________ Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that ______________________, or
registered assigns, is the registered holder of __________ Warrants to
purchase initially, at any time from _______________, 1995 until 5:30 p.m.,
Denver time, on _________________, 2000 ("Expiration Date"), up to ______
shares of Class A voting common stock, $.0l par value ("Common Stock") of
CRYENCO SCIENCES, INC., a Delaware corporation (the "Company"), at the price
per share of Common Stock equal to the Exercise Price set forth in the Warrant
Agreement dated as of __________________, 1995 between the Company and
____________________ (the "Warrant Agreement"), upon surrender of this Warrant
Certificate and payment of the Exercise Price at an office or agency of the
Company, but subject to the conditions set forth herein and in the Warrant
Agreement. Payment of the Exercise Price shall be made by certified or
official bank cashier's check payable to the order of the Company; PROVIDED,
HOWEVER, that the Holder shall have the right, at his or its election, in lieu
of delivering the Exercise Price in cash, to instruct the Company in the form
of subscription to retain, in payment of the Exercise Price, a number of
shares of Common Stock (the "Payment Shares") equal to the quotient of (i) the
Exercise Price multiplied by the number of shares as to which the Warrant is
then being exercised divided by (ii) the "Average Closing Price" as of the
date of exercise and to deduct the number of Payment Shares from the shares to
be delivered
12
<PAGE> 13
to the Holder. "Average Closing Price" means, as of any date, (x) if shares of
Common Stock are listed on a national securities exchange, the average of the
closing sales prices therefor on the largest securities exchange on which such
shares are traded on the 10 trading days before such date, (y) if such shares
are listed on the NASDAQ National Market System but not on any national
securities exchange, the average of the closing sales prices therefor on the
NASDAQ National Market System on the last 10 trading days before such date or
(z) if such shares are not listed on either a national securities exchange or
the NASDAQ National Market System, the average of the sales prices therefor on
the last 20 trading days before such date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which
is hereby incorporated by reference in and made a part of this instrument and
is hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's
securities issuable thereupon may, subject to certain conditions, be adjusted.
In such event, the Company will, at the request of the Holder, issue a new
Warrant Certificate evidencing the adjustment in the Exercise Price and the
number and/or type of securities issuable upon the exercise of the Warrants;
PROVIDED, HOWEVER, that the failure of the Company to issue such new Warrant
Certificates shall not in any way change, alter, or otherwise impair, the
rights of the Holder as set forth in the Warrant Agreement to purchase the
number of shares for the exercise price as so adjusted or any other rights set
forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate
or Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided herein and in the
Warrant Agreement, without any charge except for any tax or other governmental
charge imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the
13
<PAGE> 14
Holder(s) hereof, and for all other purposes, and the Company shall not be
affected by any notice to the contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate
to be duly executed under its corporate seal.
Date as of ________________, 1995
CRYENCO SCIENCES, INC.
[SEAL]
By:_____________________
Name:
Title:
Attest:
_________________________________
Name:
Title:
14
<PAGE> 15
FORM OF ELECTION TO PURCHASE
TO: Cryenco Sciences, Inc.
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase:
____________ shares of Class A voting Common Stock;
and herewith [tenders in payment for such securities a certified or
official bank cashier's check payable to the order of CRYENCO SCIENCES, INC.
in the amount of $_____________ therefor] [instructs you herein, in payment of
the Exercise Price, to deduct __________ shares of Class A voting Common Stock
and to deliver the net number of shares, being _________ shares of Class A
voting Common Stock]. The undersigned requests that a certificate for such
securities be registered in the name of _________________________ whose
address is ______________________________________________ and that such
Certificate be delivered to ___________________________________________ whose
address is __________________________________________
Dated: Signature: _________________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Holder)
15
<PAGE> 16
FORM OF ASSIGNMENT
(To be exercised by the registered holder if such holder desires to
transfer the Warrant Certificate to the extent permitted by Section 5 of the
Warrant Agreement.)
FOR VALUE RECEIVED _________________________________________ hereby
sells, assigns and transfers unto
________________________________________________
(Please print name and address of transferee)
this Warrant Certificate; together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _______________________
Attorney, to transfer the within Warrant Certificate on the books of the
within-named Company, with full power of substitution.
Dated: Signature:______________________________
(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
(Insert Social Security or Other Identifying
Number of Assignee)
16
<PAGE> 1
Exhibit 4.29
WARRANT CERTIFICATE
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("ACT"), AND MAY NOT BE OFFERED OR SOLD
EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II)
TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER
SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR (III) AN OPINION OF
COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE
ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., DENVER TIME, January 25, 2000
No. W-1995(A) 1 25,000 Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that Alfred Schechter, or registered
assigns, is the registered holder of 25,000 Warrants to purchase initially, at
any time from January 26, 1995 until 5:30 p.m., Denver time, on January 25, 2000
("Expiration Date"), up to 25,000 shares of Class A voting common stock, $.01
par value ("Common Stock") of CRYENCO SCIENCES, INC., a Delaware corporation
(the "Company"), at the price per share of Common Stock equal to the Exercise
Price set forth in the Warrant Agreement dated as of January 26, 1995 between
the Company and Alfred Schechter (the "Warrant Agreement"), upon surrender of
this Warrant Certificate and payment of the Exercise Price at an office or
agency of the Company, but subject to the conditions set forth herein and in the
Warrant Agreement. Payment of the Exercise Price shall be made by certified or
official bank cashier's check payable to the order of the Company; PROVIDED,
HOWEVER, that the Holder shall have the right, at his or its election, in lieu
of delivering the Exercise Price in cash, to instruct the Company in the form of
subscription to retain, in payment of the Exercise Price, a number of shares of
Common Stock (the "Payment Shares") equal to the quotient of (i) the Exercise
Price multiplied by the number of shares as to which the Warrant is then being
exercised divided by (ii) the "Average Closing Price" as of the date of exercise
and to deduct the number of Payment Shares from the shares to he delivered to
the Holder. "Average Closing Price" means, as of any date, (x) if shares of
Common Stock are listed on a national securities exchange, the average of the
closing sales prices therefor on the largest securities exchange on which such
shares are traded on the 10 trading days before
<PAGE> 2
such date, (y) if such shares are listed on the NASDAQ National Market System
but not on any national securities exchange, the average of the closing sales
prices therefor on the NASDAQ National Market System on the last 10 trading
days before such date or (z) if such shares are not listed on either a
national securities exchange or the NASDAQ National Market System, the average
of the sales prices therefor on the last 20 trading days before such date.
No Warrant may be exercised after 5:30 p.m., Denver time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Company and the Holders
(the words "Holders" or "Holder" meaning the registered holders or registered
holder) of the Warrants.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the Holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; PROVIDED,
HOWEVER, that the failure of the Company to issue such new Warrant Certificates
shall not in any way change, alter, or otherwise impair, the rights of the
Holder as set forth in the Warrant Agreement to purchase the number of shares
for the exercise price as so adjusted or any other rights set forth in the
Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the Holder hereof a new
Warrant Certificate representing such unexercised Warrants.
The Company may deem and treat the registered Holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the Holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
2
<PAGE> 3
All terms used in this Warrant Certificate which are defined in the Warrant
Agreement shall have the meanings assigned to them in the Warrant Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Date as of January 26, 1995
CRYENCO SCIENCES, INC.
[SEAL]
By: /s/ Don M. Harwell
-----------------------
Name: Don M. Harwell
Title: Vice President
Attest:
/s/ Alison A. Murray
- -------------------------
Name: Alison A. Murray
Title: Secretary
3
<PAGE> 1
Exhibit 4.30
AMENDMENT NO. 1 TO WARRANT AGREEMENT
This Amendment No. 1 to Warrant Agreement is made as of this 31st day
of July, 1997, by and between Mr. Alfred Schechter (the "Holder"), Cryenco
Sciences, Inc., a Delaware corporation (f/k/a Cryenco Holdings, Inc.)
("Cryenco") and Chart Industries, Inc., a Delaware corporation ("Chart").
WHEREAS, the Holder and Cryenco are parties to a warrant agreement or
agreements (the "Warrant Agreement") dated as of March 13, 1993 and January 26,
1995, pursuant to which Cryenco granted the Holder a warrant or warrants (the
"Cryenco Warrant") to purchase an aggregate of 75,000 shares of Cryenco Class A
common stock, par value $.O1 per share (the "Cryenco Common Stock");
WHEREAS, Cryenco and Chart entered into a Plan and Agreement of Merger
dated as of April 30, 1997 (the "Merger Agreement") providing for the merger of
an affiliate of Chart into Cryenco (the "Merger") and the conversion of all
issued and outstanding Cryenco Common Stock (other than dissenters' shares) into
cash in the amount of $2.75 per share;
WHEREAS, in Section 5.4(b)(iii) of the Merger Agreement, Chart has
agreed to offer to grant a substitute warrant (the "Chart Warrant") to purchase
shares of Chart's common stock, par value $.01 per share (the "Chart Common
Stock), in exchange for the Cryenco Warrant; and
WHEREAS, the Holder, Cryenco and Chart now desire that, in satisfaction
of Chart's obligations under Section 5.4(b)(iii) of the Merger Agreement, the
Cryenco Warrant be amended to provide the Holder with the right to purchase
Chart Common Stock in substitution for the right to purchase Cryenco Common
Stock;
NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements and undertakings set forth herein, the parties hereby agree as
follows:
1. DEFINITIONS. Capitalized terms not otherwise defined herein shall
have the meaning ascribed to them in the Merger Agreement.
2. AMENDMENT. As of the effective time of the Merger (the "Effective
Time"), the Warrant Agreement and the form of Cryenco Warrant referenced therein
are hereby amended as follows:
(a) CHART COMMON STOCK SUBSTITUTED FOR CRYENCO COMMON STOCK. All
references to the right of the Holder to purchase shares of
Cryenco Common Stock shall be deleted and the right to
purchase shares of Chart Common Stock shall be substituted
therefor.
<PAGE> 2
(b) ADJUSTMENT TO NUMBER OF SHARES UNDERLYING WARRANT. The number
of shares of Chart Common Stock issuable upon exercise of the
warrant shall be the product of (i) the number of shares of
Cryenco Common Stock that were issuable upon exercise of the
Cryenco Warrant times (ii) a fraction (the "Exchange Ratio")
the numerator of which shall be $2.75 and the denominator of
which shall be the average of the closing sales price of
Chart Common Stock on the New York Stock Exchange as reported
by the Wall Street Journal for the ten trading days preceding
the Effective Time; provided, however, that in no event shall
the Exchange Ratio be less than .165 nor more than .206.
(c) ADJUSTMENT TO PURCHASE OR EXERCISE PRICE. The purchase or
exercise price per share of Chart Common Stock subject to the
Chart Warrant shall be equal to (i) the purchase or exercise
price per share of Cryenco Common Stock divided by (ii) the
Exchange Ratio.
(d) NOTICES. Any notices, requests, forms, certificates or other
documents or communications deliverable to Cryenco under the
Warrant Agreement shall be required to be delivered instead
to Chart at 35555 Curtis Boulevard, Eastlake, OH 44095, to
the attention of the Chief Financial Officer, with a copy to
Calfee, Halter & Griswold LLP, 1400 McDonald Investment
Center, 800 Superior Avenue, Cleveland, OH 44114, Attention:
Thomas F. McKee.
(e) SUBMISSION TO JURISDICTION. Any provision in the Warrant
Agreement requiring that any action, claim or proceeding
arising out of, or relating in any way to, the Warrant
Agreement be brought exclusively in a jurisdiction located in
the State of Colorado shall be deleted in its entirety.
(f) SUBSTITUTION OF WARRANTS. Chart and the Holder agree that any
and all Warrants and/or Warrant Certificates issued pursuant
to the Warrant Agreement shall be amended in a manner
consistent with the provisions of this Amendment No. 1 and
that, upon the Holder's presentation to Chart of such
Warrants or Warrant Certificates, Chart shall deliver to the
Holder, in exchange and substitution therefor, new Warrant or
Warrant Certificates.
3. FULL COMPLIANCE; ASSUMPTION OF CRYENCO'S OBLIGATIONS; REFERENCES TO
CRYENCO. The Holder acknowledges and agrees that, as of the Effective Time,
Cryenco is in full compliance with all of its obligations under the Warrant
Agreement, the Cryenco Warrant and any related agreements pertaining to
registration rights of the Holder with respect to the shares of Cryenco Common
Stock issuable upon exercise of the Warrants. As of the Effective Time, Chart
assumes all of the obligations of Cryenco under the Warrant Agreement as
amended hereby, and all references to Cryenco in the Warrant Agreement shall be
deemed to be
<PAGE> 3
references to Chart. To the extent that Holder is party to a separate
registration rights agreement relating to Cryenco Common Stock, promptly after
the Effective Time, Chart and the Holder shall enter into such supplemental
agreement as may be necessary to provide the Holder with equivalent
registration rights relating to Chart Common Stock issuable upon exercise of
the Chart Warrant.
4. RECEIPT OF CHART DISCLOSURES. The Holder acknowledges that it has
received copies of Chart's 1996 Form 10-K Report and Chart's Form 10-Q Report
for the three-month period ended March 31, 1997.
5. NO RIGHT TO PURCHASE CRYENCO COMMON STOCK. At and after the Effective
Time, the Holder shall be deemed to have surrendered any and all rights under
the Warrant Agreement and Warrant to purchase Cryenco Common Stock.
6. CONSENT TO AMENDMENT. By the execution and delivery of this Amendment
No. 1, the Holder shall be deemed to have consented to the terms hereof in
accordance with the terms of the Warrant Agreement.
7. NO OTHER AMENDMENTS. Except as specifically provided herein or as
otherwise necessary or appropriate to effectuate the intent of this Amendment
No. 1, the provisions of the Cryenco Warrant shall remain in full force and
effect without any alteration or modification thereto. Without limiting the
generality of the foregoing, the date of grant and the date of termination of
the Cryenco Warrant shall continue to be such dates as were in effect
immediately prior to the Effective Time.
8. SUCCESSORS AND ASSIGNS. This Agreement and all of the provisions
hereof shall be binding on and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
9. GOVERNING LAW. This Amendment No. 1 shall be, and the Warrant Agreement
shall be amended to provide that it shall be, governed by and construed in
accordance with, the laws of the State of Delaware, without giving effect to
principles of conflicts of law.
10. SEVERABILITY. If any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held to be invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
11. COUNTERPARTS. This Amendment No. 1 may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same instrument.
-3-
<PAGE> 4
IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as of
the date first written above.
CHART INDUSTRIES, INC.
Attest: /s/ Suzanne Lines /s/ Don A. Baines
---------------------- ------------------------------
By: Don A. Baines
Title: CFO & Treasurer
HOLDER
Attest: /s/ Alfred Schechter
---------------------- ------------------------------
ALFRED SCHECHTER
CRYENCO SCIENCES, INC.
Attest: /s/ Steve M. Lutt /s/ James A. Raabe
---------------------- ------------------------------
By: James A. Raabe
Title: VP & CFO
-4-
<PAGE> 1
EXHIBIT 10.20
CREDIT AGREEMENT
BY AND BETWEEN
CHART INDUSTRIES, INC., ALTEC INTERNATIONAL LIMITED
PARTNERSHIP, ALTEC, INC, CHART MANAGEMENT COMPANY, INC., CHART
INDUSTRIES FOREIGN SALES CORPORATION,
GREENVILLE TUBE CORPORATION, AND
PROCESS SYSTEMS INTERNATIONAL, INC.
The "Borrowing Group"
NATIONAL CITY BANK AND NBD BANK,
The "Banks" or "Bank"
NATIONAL CITY BANK, AS AGENT FOR THE BANKS
The "Agent"
July __, 1997
<PAGE> 2
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C> <C>
ARTICLE I - DEFINITIONS; ACCOUNTING TERMS; AMENDMENTS............................1
Section 1.01 Definitions. ............................................1
Section 1.02 Accounting Terms. ......................................17
ARTICLE II - CREDIT FACILITY....................................................17
Section 2.01 Amounts. ...............................................17
Section 2.02 Reduction. .............................................17
Section 2.03 Single Loan. ...........................................18
Section 2.04 Advances; LCs; Revolving Period. .......................18
Section 2.05 Interest on the Revolving Loan. ........................18
Section 2.06 Election of Base Rate for Revolving Loan ................18
Section 2.07 Election of Overall Libor Rate for Revolving Loan. .....18
Section 2.08 Notice. ................................................20
Section 2.09 Limits on Overall Libor Rate Elections. ................20
Section 2.10 Compensation; Illegality. ..............................21
Section 2.11 Interest Payment Dates. ................................22
Section 2.12 Voluntary Prepayments. .................................22
Section 2.13 Application of Payments to Revolving Loan. .............23
Section 2.14 Overall Libor Rate Indemnity. ..........................23
Section 2.15 Interest Calculations. .................................23
Section 2.16 Late Charge; Post-Default Rate. ........................24
Section 2.17 Commitment Fee. ........................................24
Section 2.18 Repayment of the Revolving Loan;
The Revolving Notes .....................................24
Section 2.19 Letters of Credit .......................................25
Section 2.20 Ratable Participation in LCs. ..........................25
Section 2.21 Maximum..................................................25
Section 2.22 Term ....................................................26
Section 2.23 Form ....................................................26
Section 2.24 Fees ...................................................26
Section 2.25 Commissions ............................................26
Section 2.26 Reimbursement ..........................................27
Section 2.27 Foreign Currencies .....................................27
Section 2.28 Purpose of the Revolving Loan. .........................28
Section 2.29 Event of Default or Possible Default. ..................28
Section 2.30 Agent Fees. ............................................28
</TABLE>
i
<PAGE> 3
<TABLE>
<S> <C> <C>
ARTICLE III - INTERCOMPANY MATTERS..............................................29
Section 3.01 Appointment of Parent as Agent. .........................29
Section 3.02 Intercompany Guaranty.....................................29
Section 3.03 Further Assurances. .....................................31
ARTICLE IV - REPRESENTATIONS AND WARRANTIES OF THE BORROWING
GROUP..................................................................31
Section 4.01 Organization of the Companies; Business
and Property; CHD. .....................................32
Section 4.02 Authorization; Validity. ................................32
Section 4.03 Permits. ................................................32
Section 4.04 Financial Statements. ...................................33
Section 4.05 Financial Condition at Date of Credit Agreement. ........33
Section 4.06 No Adverse Changes. .....................................33
Section 4.07 Title to Properties; Patents, Trade Marks, etc. .........33
Section 4.08 Litigation. .............................................34
Section 4.09 Liabilities. ............................................34
Section 4.10 Compliance with Other Instruments. ......................34
Section 4.11 Material Restrictions. ..................................34
Section 4.12 Correctness of Data Furnished. ..........................34
Section 4.13 ERISA. ..................................................35
Section 4.14 Taxes. ..................................................36
Section 4.15 Compliance with Laws. ...................................36
Section 4.16 Environmental Matters. ...................................36
Section 4.17 Leases. .................................................37
Section 4.18 Regulation U, etc. ......................................37
Section 4.19 Holding Company Act. ....................................37
Section 4.20 Securities Act, etc. ....................................37
Section 4.21 Solvency. ...............................................37
Section 4.22 No Default. .............................................38
Section 4.23 Employee Controversies. .................................38
Section 4.24 Brokers, etc. ...........................................38
ARTICLE V - CONDITIONS TO BORROWING.............................................38
Section 5.01 Representations and Warranties. .........................38
Section 5.02 No Defaults. ............................................38
Section 5.03 Performance. ............................................38
Section 5.04 Closing Certificate. ....................................38
Section 5.05 Insurance Report. .......................................39
Section 5.06 Revolving Notes/Pledge Agreement. .......................39
Section 5.07 Disbursement Instructions. ..............................39
</TABLE>
ii
<PAGE> 4
<TABLE>
<S> <C> <C>
Section 5.08 Opinions of Counsel for the Borrowing Group. ...........39
Section 5.09 Corporate Proceedings. .................................39
Section 5.10 Payment of Expenses. ...................................40
Section 5.11 Schedules. .............................................40
Section 5.12 Other Documents. .......................................40
Section 5.14 No Defaults. ...........................................41
Section 5.15 Performance. ...........................................41
Section 5.16 Representations and Warranties. ........................41
Section 5.17 Certificate. ...........................................41
Section 5.18 Cryenco. ...............................................41
ARTICLE VI - AFFIRMATIVE COVENANTS OF THE BORROWING GROUP..........................41
Section 6.01 Payment of Amounts Due. ................................42
Section 6.02 Existence, Business, etc. ..............................42
Section 6.03 Maintenance of Properties. .............................42
Section 6.04 Payment of Taxes, etc. .................................42
Section 6.05 Insurance. .............................................43
Section 6.06 Accounts and Reports of each Company. ..................43
Section 6.07 Information and Inspection. ............................45
Section 6.08 Notice of Litigation. ..................................46
Section 6.09 Pension Plans. .........................................46
Section 6.10 Hazardous Material. ....................................46
Section 6.11 Net Worth. .............................................46
Section 6.12 Leverage. ..............................................47
Section 6.13 Pretax Interest Coverage Ratio. ........................47
Section 6.14 Fixed Charge Coverage Ratio. ...........................47
Section 6.15 Current Ratio. .........................................47
Section 6.17 Post-Closing Items. ....................................47
Section 6.18 Further Assurances. ....................................47
ARTICLE VII - NEGATIVE COVENANTS OF THE BORROWING GROUP............................47
Section 7.01 Limitation of Indebtedness. ............................48
Section 7.02 Limitation on Liens. ...................................49
Section 7.03 Guarantees. ............................................51
Section 7.04 Leases. ................................................51
Section 7.05 Investments, Revolving Loan, and Advances. .............52
Section 7.06 Assignment or Sale of Accounts or Revolving Notes
Receivable...............................................53
Section 7.07 Liquidation, Merger, or Consolidation. .................53
Section 7.08 Amendment of Certificate of Incorporation
and/or By-Laws...........................................54
</TABLE>
iii
<PAGE> 5
<TABLE>
<S> <C> <C>
Section 7.09 Distributions; Purchases or Redemption of
Stock; Dividends ..............................................54
Section 7.10 Disposition of Assets. ..................................55
Section 7.11 Acquisition of Going Concern Business. ..................55
Section 7.12 Purchase of Fixed or Capital Assets. ....................56
Section 7.13 Fiscal Year. ............................................56
Section 7.14 ERISA. ..................................................56
Section 7.15 Regulation U. ...........................................57
Section 7.16 Partnerships and Joint Ventures. ........................57
Section 7.17 Transactions with Affiliates. ...........................57
Section 7.18 Tax Exemption of CHD. ...................................57
Section 7.19 Goodwill/Intangibles. ...................................58
ARTICLE VIII - WAIVERS..............................................................58
ARTICLE IX - DEFAULTS...............................................................58
Section 9.01 Principal Default. ......................................58
Section 9.02 Interest Default. .......................................59
Section 9.03 Other Payment Defaults. .................................59
Section 9.04 Certain Article VI and VII Defaults. ....................59
Section 9.06 Defaults Under Article VI. ..............................59
Section 9.07 Other Provision Default. ................................59
Section 9.08 Representation and Warranty. ............................59
Section 9.09 Financial Difficulties. .................................60
Section 9.10 ERISA Termination. ......................................60
Section 9.11 Accumulated Funding Deficiency. .........................60
Section 9.12 Ownership. ..............................................61
Section 9.13 Cross-Default. ..........................................61
Section 9.14 Judgments. ..............................................61
Section 9.15 Material Adverse Change. ................................61
Section 9.16 Restraint on Business. ..................................62
ARTICLE X - REMEDIES................................................................62
Section 10.01 Acceleration. ..........................................62
Section 10.02 Recovery of Amounts. ...................................62
Section 10.03 LCs. ...................................................63
Section 10.04 Remedies Cumulative. ...................................63
Section 10.05 Cost of Collection. ....................................63
Section 10.06 No Advances, etc. ......................................63
</TABLE>
iv
<PAGE> 6
<TABLE>
<S> <C> <C>
ARTICLE XI - AGENT................................................................63
Section 11.01 Appointment of Agent. .................................63
Section 11.02 Compensation. .........................................64
Section 11.03 Independent Investigation. ............................64
Section 11.04 Agent's Exculpation. ..................................64
Section 11.05 Disbursements. ........................................64
Section 11.06 The Agent's Indemnity. ................................65
Section 11.07 Actions After a Default Under this Agreement. .........65
Section 11.08 Actions Requiring Consent of a Majority
of the Banks ................................................66
Section 11.09 Actions Requiring Consent of All Banks. ...............66
ARTICLE XII - MISCELLANEOUS.......................................................66
Section 12.01 Payment of Expenses. ..................................66
Section 12.02 Notices. ..............................................67
Section 12.03 Survival of Representations and Warranties. ...........68
Section 12.04 Entire Agreement; Amendment. ...........................68
Section 12.05 Parties in Interest; Bank's Purpose. ..................68
Section 12.06 Waiver of Assertion of Counterclaims;
Waiver of Jury Trial. .................................69
Section 12.07 Set-off Provision. ....................................69
Section 12.08 Severability of Provisions. ...........................70
Section 12.09 Headings. .............................................70
Section 12.10 Consent to Jurisdiction. ..............................70
Section 12.11 Governing Law. ........................................70
Section 12.12 Counterparts. .........................................70
Section 12.13 Nature of the Borrowing Group's Obligations and
Modification Thereof. .................................71
</TABLE>
v
<PAGE> 7
CREDIT AGREEMENT
----------------
THIS CREDIT AGREEMENT (the "Credit Agreement" or "Agreement"), dated as
of the day of July, 1997, by and between CHART INDUSTRIES, INC., a Delaware
corporation (referred to hereinafter as the "Parent"), ALTEC INTERNATIONAL
LIMITED PARTNERSHIP ("ALTEC"), ALTEC, INC. ("AI"), CHART MANAGEMENT COMPANY,
INC. ("Chart Management"), CHART INDUSTRIES FOREIGN SALES CORPORATION ("Chart
Foreign"), GREENVILLE TUBE CORPORATION ("Greenville"), PROCESS SYSTEMS
INTERNATIONAL, INC. ("PSI") (the Parent, ALTEC, AI, Chart Management, Chart
Foreign, Greenville and PSI being referred to collectively as the "Borrowing
Group") and NATIONAL CITY BANK ("NCB") and NBD BANK, ("NBD") (NCB and NBD being
referred to collectively as the "Banks" and singly as a "Bank") and NATIONAL
CITY BANK, as agent for the Banks (the "Agent")).
WITNESSETH;
-----------
WHEREAS, the Borrowing Group desires to obtain from the Banks an
unsecured revolving credit facility (the "Credit Facility") in a principal
amount not to exceed FORTY FIVE MILLION DOLLARS ($45,000,000) less the face
amount of any outstanding letters of credit and foreign bank guaranties
including both (i) a revolving loan that may be borrowed, repaid and reborrowed
and (ii) standby letters of credit in an aggregate stated amount not to exceed
FIFTEEN MILLION DOLLARS ($15,000,000) (the "Revolving Loan"), all upon the terms
and conditions set forth hereafter.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
In addition to terms defined elsewhere in this Credit Agreement,
certain terms used herein are defined in Section 1.01.
ARTICLE I
DEFINITIONS; ACCOUNTING TERMS; AMENDMENTS
-----------------------------------------
Section 1.01 DEFINITIONS. As used herein and in the Revolving Notes and
the other Loan Documents, the following terms shall have the following meanings:
<PAGE> 8
"Acceptable Marketable Securities" means securities that are direct
obligations of the United States of America or any agency thereof, or
certificates of deposit issued by any Bank, or any other money-market investment
if it carries the highest quality rating of any nationally-recognized rating
agency, provided that no such security shall mature more than ninety (90) days
after the date when made.
"Account Officer" means that officer of the Bank in question who at the
time in question is designated by that Bank as the officer having the primary
responsibility for giving consideration to the Borrowing Group's request for
credit or, in that officer's absence, that officer's immediate superior or any
other officer who reports directly to that superior officer.
"Adjusted Net Worth" means, as of any date of determination thereof,
the excess of (a) the amount of the "present fair saleable value" of the assets
of any Guarantor as of the date of such determination over (b) the amount of all
liabilities of such Guarantor, contingent or otherwise, as of the date of such
determination, as such terms are determined in accordance with applicable
federal and state laws governing determinations of the insolvency of debtors. In
determining the Adjusted Net Worth of any Guarantor for purposes of calculating
the Maximum Guaranteed Amount for such Guarantor, (i) the liabilities of such
Guarantor shall include (x) any amounts guaranteed by such Guarantor to the
extent guaranteed pursuant to clause (a) of the definition of Maximum Guaranteed
Amount and (y) advances of Revolving Loans directly to such Guarantor (ii) the
Net Worth of any Guarantor shall exclude any increase in Net Worth resulting
from a Valuable Transfer.
"Advances" means advances of cash proceeds obtained by the Borrowing
Group in respect of the Revolving Loan.
"Advantage" means any payment (whether made voluntarily or
involuntarily, by offset of any deposit or other indebtedness or otherwise)
received by a Bank in respect of the subject indebtedness if the payment results
in that Bank's having less than its ratable share of the subject indebtedness in
question.
"Affiliate" means any director, principal officer of the Borrowing
Group or shareholder owning more than five percent (5%) of any class of
outstanding securities of the Borrowing Group, or any spouse, parent, or child
of any of the foregoing, or any corporation, partnership or other business
enterprise directly or indirectly controlled by, or under direct, indirect or
common control with, any one or more of such Persons and/or the Borrowing Group.
2
<PAGE> 9
"Alternative Currency" means any lawful currency other than Dollars
which is freely transferable and convertible into Dollars and which, from time
to time, is acceptable to NBD.
"Assets" as applied to the Borrowing Group means all items which, in
accordance with GAAP applied on a consistent basis, would be included in
determining total assets as shown on the asset side of a balance sheet of the
Borrowing Group as of the date on which Assets are to be determined.
"Authorized Fiscal Officer" means the chief executive officer or chief
financial officer of the Parent.
"Available Rates" shall have the meaning given to it in Section 2.05.
"Bank Guaranty" means any bank guaranty issued by an affiliate of NBD
for the account of PSI, each Bank Guaranty issued in Alternative Currency and
being part of the Credit Exposure of each Bank.
"Banks" shall have the meaning given to it in the preamble of this
Credit Agreement.
"Base Rate" means the fluctuating rate, as in effect at the time in
question, that is publicly announced by the Agent from time to time in
Cleveland, Ohio, as being its base rate or prime rate thereafter in effect;
which rate is not necessarily the lowest rate charged by the Banks to their
borrowing customers.
"Borrowed Debt/Net Worth" means all Indebtedness for Borrowed Money of
the Borrowing Group divided by Net Worth, all on a Consolidated basis.
"Borrowing" means a series of the Revolving Loan obtained concurrently
and divided ratably among the Banks and includes, without limitation, part of
the Revolving Loan the proceeds of which represent new money to the Borrowing
Group and part of the Revolving Loan the proceeds of which are applied to any
portion of the Revolving Loan bearing interest at an Overall Libor Rate at the
end of the applicable Libor Rate Period; to the extent that the term "borrowed
money" is used in this Agreement, it is used as a generic term and is not
derived solely from "Borrowing".
"Borrowing Group" shall have the meaning given to it in the preamble of
this Credit Agreement.
3
<PAGE> 10
"Business Day" means any day on which dealings in United States Dollar
deposits in the London inter-bank market are carried out and which is not a
Saturday, Sunday or other day on which banks in Cleveland, Ohio or Detroit,
Michigan are authorized or required to close.
"Capital Expenditures" means any and all amounts invested, expended or
incurred (including by reason of Capitalized Lease Obligations incurred by the
Borrowing Group) in respect of the purchase, acquisition, improvement,
renovation or expansion of any properties or assets of the Borrowing Group,
including, without limitation, expenditures required to be capitalized in
accordance with GAAP.
"Capitalized Lease Obligations" means, as to any Person, the
obligations of such Person to pay rent or other amounts under leases of, or
other agreements conveying the right to use real and/or personal property, which
obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person, prepared in accordance with GAAP (including the
Financial Accounting Standards Board).
"Cash Flow" means the aggregate of (a) net income plus (b) income taxes
(whether federal, state or local) plus (c) interest expense plus (d)
amortization, depreciation and obsolescence charges, all as determined in
accordance with GAAP and on a Consolidated basis.
"CHD" means CHD Inc., a Delaware corporation and wholly-owned
subsidiary of AI.
"CHD Guaranty Documents" means, collectively, CHD's joint and several
guaranty of payment of the Obligations, and, in respect of that guaranty,
resolutions having been duly adopted by CHD's board of directors and certified
by CHD's secretary, the estoppel of CHD's shareholder or shareholders, the
opinion of the Borrowing Group's legal counsel (which opinion shall address such
issues, may be based on such assumptions and may be subject to such
qualifications and exceptions as those set forth in the opinion of the
companies' counsel dated the date of this Agreement delivered to the Banks and
the Agent pursuant to this Agreement), and such other writings as the Banks and
the Agent shall reasonably require, all in form and substance satisfactory to
the Banks and the Agent except as specifically set forth herein with respect to
the opinion of the Borrowing Group's legal counsel.
"Closing Date" means the date that the proceeds of the first Advance
are disbursed to the Borrowing Group under this Credit Agreement.
4
<PAGE> 11
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and any successor statute, and the rules and regulations promulgated
thereunder.
"Company" refers to the Parent or to any Subsidiary of the Parent, as
the case may be and "Companies" means all of the Parent and its Subsidiaries.
"Commitment" means the commitment of a Bank to extend credit to the
Borrowing Group pursuant to Section 2.01 of this Agreement and upon the terms,
subject to the conditions and in accordance with other provisions of this
Agreement.
"Conclusive" means that the calculation, determination or other matter
referred to is presumed for all purposes to be true and correct and absolutely
binding on the Borrowing Group except to the extent of manifest or obvious error
(e.g. arithmetic error or misplacement of decimal points).
"Consolidated" means on a consolidated basis for the Parent and all of
its Subsidiaries, as determined in accordance with GAAP.
"Consolidated Net Income" for any period means the net income of the
Borrowing Group for such period, determined on a Consolidated basis in
accordance with GAAP.
"Covenant Compliance Certificate" shall have the meaning given to such
term in Section 6.06(ii).
"Credit Exposure" means, as to the Bank in question, the aggregate at
the time in question of (a) the unpaid principal of the Revolving Loans then
owing to it plus (b) its ratable share of the undrawn balance of the LCs then
outstanding plus (c) its ratable share of the amount of the Bank Guaranties then
outstanding.
"Credit Facility" is defined in the recitals of this Agreement.
"Cryenco" means Cryenco Sciences, Inc., a Delaware corporation.
"Cryenco Acquisition" means the acquisition by Greenville of all of the
issued and outstanding shares of capital stock of Cryenco, pursuant to that
certain Merger Agreement dated April 30, 1997.
5
<PAGE> 12
"Current Assets" means the net book value, as determined in accordance
with GAAP, of all such assets after deducting applicable reserves, if any, and
without consideration to any reappraisal or write-up of asset effected after
March 31, 1997.
"Current Liabilities" means all such Liabilities and includes (without
limitation) (a) all accrued taxes and (b) all principal of any Funded
Indebtedness (except the Outstanding Amount) maturing within twelve months of
the date of determination.
"Distribution" means any payment or distribution or transfer to,
redemption, acquisition or purchase from, or exchange with (directly or
indirectly), a Shareholder made in respect of his Equity Interest, of any
property, including, without limitation, cash, whether or not the same shall be
made from earnings of the Companies or a redemption of a Shareholder's Equity
Interest, but, excluding in all cases, any of the foregoing made by a Subsidiary
to the Parent or stock dividends or splits of the capital stock of the Parent.
"Dollars" and "$" means United States dollars or such coin or currency
of the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts in the United States.
"Effective Date" means the date on which the Banks make an Advance or
the election by the Borrowing Group of any Interest Option becomes effective.
"Environmental Laws" means any and all foreign, federal, state, local
or municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other requirements of law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning the protection of human health or the
environment, as now or may at any time be in effect.
"Environmental Remediation" means the containment, remediation,
clean-up, removal or other resolution of Hazardous Materials in respect of which
any Company has any liability or obligation.
"Equity Interests" means all capital stock and options, warrants and
rights to acquire or convert to capital stock of any of the Companies.
"Equity Offering" means any public offering or private placement of
Equity Interests or the conversion of any other debt or equity security into
Equity Interests.
6
<PAGE> 13
"ERISA" means the Employee Retirement Income Security Act of 1974 and
the regulations thereunder, each as amended from time to time.
"ERISA Affiliate" means, as applied to any Person, any trade or
business (whether or not incorporated) that would be aggregated with the
Companies for any purpose relevant to ERISA or the Code relating to any Plan or
Multi-Employer Plan.
"Event of Default" shall have the meaning specified in Article X of
this Credit Agreement.
"Execution Date" means the date of this Credit Agreement first written
above.
"Exhibits" and "Schedules" means and refers collectively to the
documents attached to this Credit Agreement and labeled as Exhibits or Schedules
hereto.
"Facilities" means the manufacturing, distribution, warehousing and
engineering facilities of the Borrowing Group and, after the Closing Date, such
additions, improvements and modifications thereto.
"federal", "state", or "local" means and relates to the United States,
its political division of states, and the respective political subdivisions and
equivalents of such states.
"Federal Funds Rate" means a fluctuating interest rate per annum, as in
effect at the time in question, that is the rate determined by NCB to be the
opening rate per annum paid or payable by it on the day in question in its
regional market for federal funds purchased overnight from other banking
institutions.
"Fiscal Year" means a period consisting of four Quarters ending on
December 31.
"Fixed or Capital Assets" means and includes all assets which are
defined or classified as fixed or capital assets in accordance with GAAP.
"Fixed Charges" means the aggregate of (a) interest expense plus (b)
current portion of Funded Indebtedness plus (c) Capital Expenditures plus (d)
Distributions (other than Distributions consisting of purchases of common shares
of Parent's capital stock for purposes of making contributions to the Companies'
401(k) Plans), all as determined in accordance with GAAP and on a Consolidated
basis.
"Fixed Charge Coverage Ratio" means the ratio of Cash Flow to Fixed
Charges.
7
<PAGE> 14
"Four-Quarter Period" means a period of four consecutive Quarters,
whether or not in the same Fiscal Year.
"Funded Indebtedness" means Indebtedness for Borrowed Money of the
person or entity in question which matures or which (including each renewal or
extension, if any, in whole or in part) remains unpaid for more than twelve
months after the date originally incurred and includes, without limitation (a)
any Indebtedness for Borrowed Money (regardless of its maturity) if it is
renewable or refundable in whole or in part solely at the option of that person
or entity (in the absence of default) to a date more than one year after the
date of determination, (b) any Capitalized Lease Obligation, (c) any Guarantee
of Indebtedness for Borrowed Money owing by another person or entity and (d) any
indebtedness secured by a security interest, mortgage or other lien encumbering
any property owned or being acquired by the person or entity in question even if
the full faith and credit of that person or entity is not pledged to the payment
thereof; provided that in the case of any Indebtedness for Borrowed Money
payable in installments or evidenced by serial notes or calling for sinking fund
payments, those payments maturing within twelve months after the date of
determination shall be considered a Current Liability rather than Funded
Indebtedness for the purposes of Section 7.14 but shall be considered Funded
Indebtedness for all other purposes.
"GAAP" means generally accepted accounting principles as consistently
applied in the United States from time to time.
"Governmental Authority" shall have the meaning given to such term in
Section 5.03.
"Guaranteed" or to "Guarantee" as applied to an obligation shall mean
and include (a) a guarantee or guaranty (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), directly or
indirectly, in any manner, of any part or all of such obligation and (b) an
agreement, direct or indirect, contingent or otherwise, and whether or not
constituting a guaranty, the practical effect of which is to assure the payment
or performance (or payment of damages in the event of non-performance) of any
part or all of such obligation whether by (i) the purchase of securities or
obligations, (ii) the purchase, sale or lease (as lessee or lessor) of property
or the purchase or sale of services primarily for the purpose of enabling the
obligor with respect to such obligation to make any payment or performance (or
payment of damages in the event of nonperformance) of or on account of any part
or all of such obligation, or to assure the owner of such obligation against
loss, (iii) the supplying of funds to or in any other manner investing in the
obligor with respect to such obligation, (iv) repayment of amounts drawn down by
beneficiaries of letters of credit or (v) the supplying of funds to or investing
in a Person on account of all or any part of such
8
<PAGE> 15
Person's obligation under a Guarantee of any obligation or indemnifying or
holding harmless, in any way such Person against any part or all of such
obligation.
"Guarantor" means one who pledges his credit or property in any manner
for the payment or other performance of the Indebtedness for Borrowed Money,
contract or other obligation of another and includes (without limitation) any
guarantor (whether of collection or payment), any obligor in respect of a
stand-by letter of credit or surety bond issued for the obligor's account, and
surety, any co-maker, any endorser and anyone who agrees conditionally or
otherwise to make any loan, purchase or investment in order thereby to enable
another to prevent or correct a default of any kind.
"Guaranty" means the obligation of a Guarantor.
"Hazardous Material" means any gasoline or petroleum (including crude
oil or any fraction thereof) or petroleum products or any hazardous or toxic
substances, materials or wastes defined or regulated as such in or under any
Environmental Law, including, without limitation, asbestos, polychlorinated
biphenyls and urea-formaldehyde insulation.
"Indebtedness for Borrowed Money" of any Person means at any date,
without duplication, (i) all obligations of such Person for borrowed money,
including, without limitation, all borrowings under insurance policies, (ii) all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments, (iii) all obligations of such Person to pay the deferred
purchase price for property or services, except accounts payable arising in the
ordinary course of business, (iv) all Capitalized Lease Obligations of such
Person, (v) all Indebtedness for Borrowed Money of others secured by a Lien on
any asset of such Person, whether or not such Indebtedness for Borrowed Money is
assumed by such Person and (vi) all Indebtedness for Borrowed Money of others
Guaranteed by such Person.
"Indemnified Liabilities" shall have the meaning given to it in
Section 12.01.
"Intangibles" means any Assets which, in accordance with GAAP applied
on a consistent basis, would be treated as intangible assets, including without
limitation, such items as goodwill, trademarks, trade names, service marks,
patents, licenses, rights with regard to any such items, unamortized debt
discount, deferred charges and organization expenses.
"Interest Option" means any one or more of the Base Rate or the Overall
Libor Rate.
9
<PAGE> 16
"Investment" means any advance, extension of credit (excluding accounts
receivable arising in the ordinary course of business and endorsements of
negotiable instruments for collection in the ordinary course of business) or
contribution of capital to any Person or purchase or other acquisition of the
stock or any notes, debentures or other securities of, or any equity interest
in, any other person.
"LCs" means any letter of credit issued by NCB for the account of the
Borrowing Group, each of which LCs being part of the Credit Exposure of each
Bank.
"Leverage Ratio" means the ratio of (A) Total Liabilities to (B) Net
Worth.
"Liabilities" as applied to the Companies, means:
(i) All items which in accordance with GAAP applied on a
consistent basis would be included in determining total liabilities as
shown on the liability side of a balance sheet of the Companies as of
the date on which Liabilities are to be determined, regardless whether
such items are recourse indebtedness or otherwise and, including,
without limitation or duplication of the foregoing, obligations in
respect of reimbursement for letters of credit issued, obligations in
respect of funding obligations for any Plan or Multi-Employer Plan,
obligations in respect of Environmental Remediation, and obligations in
respect of deferred compensation; and
(ii) All liabilities of others within the meaning of (i) above
which the Companies has directly or indirectly Guaranteed, endorsed
(otherwise than for collection or deposit in the ordinary course of
business), discounted with recourse or agreed (contingently or
otherwise) to purchase or repurchase or otherwise acquire or become
liable for, or in respect of which the Companies have entered into any
agreement for the purchase or other acquisition of any product,
materials, or supplies, or for the making of shipments, or for the
payment for services, if in any such case payment therefor is to be
made regardless of the nondelivery of the product, materials, or
supplies or the nonfurnishing of the transportation or services.
"Libor Margin" shall mean the number of basis points calculated based
on the following performance grid (pricing is based on the higher of the rates
resulting from independent application of the second and third columns and is
adjusted quarterly as more fully described in Section 2.07):
10
<PAGE> 17
<TABLE>
<CAPTION>
Borrowed Fixed Charge LIBOR Plus Letter of Credit
Level Debt/ Coverage Ratio (basis points) Pricing (%)
Net Worth
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 less than or greater than or
equal to 1.00 equal to 2.61 100 1.00
2 1.01 to 1.35 2.16 to 2.60 125 1.25
3 1.36 to 1.70 2.71 to 2.15 150 1.50
4 1.71 to 2.00 1.26 to 1.70 175 1.50
</TABLE>
"Libor Rate" means, with respect to any Effective Date, a rate per
annum equal to the quotient obtained (rounded upwards, if necessary, to the next
highest 1/100 of 1%) by dividing (i) the rate of interest determined by the
Agent three (3) Business Days prior to such Effective Date that it would have to
pay on such Effective Date in the London inter-bank market for inter-bank
deposits of United States Dollars with a maturity equal (or as nearly equal as
possible) to the Libor Rate Period selected by the Borrowing Group and in an
amount equal to such amount of the Revolving Loan on which interest will be
determined by the Libor Rate by (ii) 1.00 minus for the day the rate of interest
is determined by the Agent that percentage (expressed as a decimal) which is in
effect on such day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the reserve requirement for
the Banks in respect of "Eurocurrency liabilities" (or in respect of any other
category of liabilities which includes deposits by reference to which the Libor
Rate is determined or any category of extensions of credit or other assets which
includes loans by a non-United States office of the Banks to United States
residents). The Libor Rate will be increased by such amount as provided in
Section 2.09 to compensate the Banks for the changes in circumstances described
in Section 2.09 and if such changes in circumstances are no longer applicable or
are otherwise modified so that such increase is no longer required in whole or
in part, then the Libor Rate will be decreased on an equivalent basis (in whole
or in part), in each case, without duplication.
"Libor Rate Period" means the period for which an Overall Libor Rate is
in effect for the purpose of determining the rate of interest on all or any part
of the Revolving Loan.
"Lien" as applied to the property of any Person means: (a) any
mortgage, lien, pledge, charge, lease constituting a Capitalized Lease
Obligation, conditional sale or other title retention agreement, or other
security interest or encumbrance of any kind in respect of any property of such
Person, or upon the income or profits therefrom; (b) any arrangement, express or
implied, under which any property of such Person is transferred, sequestered or
11
<PAGE> 18
otherwise identified for the purpose of subjecting the same to the payment of
Indebtedness for Borrowed Money in priority to the payment of the general,
unsecured creditors of such Person; (c) any Liabilities which are unpaid more
than 60 days after the same shall have become due and payable and which if
unpaid would by law (including, but not limited to, bankruptcy and insolvency
laws), or otherwise, be given any priority whatsoever over general unsecured
creditors of such Person; and (d) the filing of, or any agreement to give, any
financing statement under the Uniform Commercial Code or its equivalent of any
jurisdiction in respect of Indebtedness for Borrowed Money.
"Loan Documents" means and includes this Credit Agreement and the
Revolving Notes.
"Majority of the Banks" means Banks which have committed not less than
two-thirds (2/3), by amount, of the Commitments as set forth in Section 2.01.
"Material Adverse Effect" means a materially adverse effect on the
business, properties, operations or condition (financial or otherwise) of the
Companies, on a Consolidated basis.
"Maximum Guaranteed Amount" means, as to any of the Borrowing Group to
the extent deemed to be a Guarantor under Section 3.02 of this Agreement, as of
any date of determination thereof, the sum of (a) the aggregate amount of the
Revolving Loans to any other member of the Borrowing Group, to the extent that
the proceeds thereof are used to make a Valuable Transfer by such other member
to such Guarantor plus (b) the greater of (i) 95% of the Adjusted Net Worth of
such Guarantor at the date of the execution of this Agreement and (ii) 95% of
the Adjusted Net Worth of such Guarantor at the earlier of (A) the date of the
commencement of a case under Title 11 of the United States Code in which such
Guarantor is a debtor and (B) the date enforcement hereunder is obtained and
realized upon.
"Multi-Employer Plan" shall have the meaning given to the term
"multi-employer plan" in Section 5.13 hereof.
"Net Proceeds" means, with respect to the sale or disposition of any
asset, the total proceeds received in cash (from time to time, including,
without limitation, any installment, rental or other deferred payments) upon
such sale or disposition minus (i) any reasonable out-of-pocket expenses
directly arising out of such sale or disposition and (ii) Taxes payable in
respect of such proceeds.
12
<PAGE> 19
"Net Worth" means the amount equal to the sum of (i) Assets minus (ii)
Liabilities, of the Companies on a Consolidated basis, as determined in
accordance with GAAP.
"Obligations" means:
(i) the payment of all principal of and interest owing or
outstanding on any of the Revolving Notes or the Revolving Loan,
including, without limitation, future advances made by the Banks which
are or may be evidenced by said Revolving Notes, regardless of whether
the Banks were obligated to make such advances;
(ii) the payment of all amounts from time to time owing to a
Bank or the Agent under or in connection with this Credit Agreement or
any of the Collateral Security Documents;
(iii) the payment by the Borrowing Group of all reasonable
costs and expenses (including attorneys' fees) incurred by any of the
Banks or the Agent in the collection of the Revolving Loan or any of
the Revolving Notes or in the enforcement of their rights under this
Credit Agreement or the other Loan Documents;
(iv) the payment by the Borrowing Group of all sums expended
or advanced by a Bank or the Agent pursuant to the terms of this Credit
Agreement, or any other Loan Document;
(v) the performance by the Borrowing Group of all its
obligations under this Credit Agreement, the Revolving Notes and the
other Loan Documents;
(vi) subject to the simultaneous or prior payment of the
amounts described in clauses (i) through (v) above and only so long as
any such amounts are unpaid, the payment of any and all other
indebtedness (including principal, interest or fees, if any) of any
kind or description now or hereafter owing by the Borrowing Group to a
Bank, including, without limitation, overdrafts, amounts owing under
other notes, bonds, debentures, letters of credit, interest rate
protection arrangements or other evidences of indebtedness and
contingent obligations.
"Outstanding Amount" means the sum of (i) the outstanding unpaid
principal of the Revolving Loan plus (ii) the outstanding stated amount of any
LCs plus (iii) the amount of any Bank Guaranties then outstanding.
"Overall Libor Rate" means the Libor Rate plus the Libor Margin.
13
<PAGE> 20
"Overall Libor Rate Indemnity" shall have the meaning specified in
Section 2.14 in respect of a Loan to the extent bearing interest at an Overall
Libor Rate.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
successor thereto.
"Permitted Capital Expenditures" means Capital Expenditures of the
Borrowing Group not in excess of the amounts for the relevant period as set
forth in Section 7.12.
"Permitted Distributions" has the meaning given to such term in Section
7.09.
"Permitted Exceptions" has the meaning given to such term in Section
7.02.
"Permitted Indebtedness" has the meaning given to such term in Section
7.01.
"Person" includes a corporation, an association, a partnership, an
organization, a trust or business trust, an individual, a government or
political subdivision thereof or a governmental agency or other entity.
"Plan" means any pension plan which is covered by Title IV of ERISA in
respect of which the Borrowing Group or any ERISA Affiliate is an "employer" as
defined in Section 3(5) of ERISA.
"Pledge Agreement" means the pledge agreement of even date herewith
executed and delivered by ALTEC and Chart Management pledging to the Agent for
the ratable benefit of the Banks all of the issued shares of common stock of
CHD, on terms and conditions acceptable to the Banks.
"Possible Default" means an event or condition which, after notice or
lapse of time, or both, would constitute an Event of Default.
"Post-Default Rate" means a per annum rate of interest equal to two
percent (2%) over the Base Rate.
"Pretax Interest Coverage Ratio" means the ratio of (i) the sum of (a)
net income plus (b) income taxes (whether federal, state or local) plus (c)
interest expense to (ii) interest expense.
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"Quarter" means a period of three successive calendar months ending on
March 31, June 30, September 30 or December 31.
"Ratable" and "Ratably" mean in the proportion of the Commitments as
set forth in Section 2.01.
"Reference Rate" means, on any given date, either the Base Rate in
effect for that day or a rate equal to one percent (1%) per annum plus the
federal funds rate in effect for that day, whichever rate shall be the higher
for that day.
"Reportable Event" means any of the events set forth in Section 4043(b)
of ERISA or the regulations thereunder, in each case where reporting
requirements have not been waived and which event could or would give rise to
the termination of any Plan, the appointment of a trustee for such Plan or
otherwise impose any liability on the Companies, including, without limitation,
as described in Department of Labor Regulations sections 2615.11, 2615.12 or
2615.15 through 2615.17.
"Revolving Loan" shall have the meaning given to it in the recitals of
this Agreement.
"Revolving Notes" means the promissory notes executed by the Borrowing
Group in favor of the Banks to evidence the Borrowing Group's indebtedness
pursuant to the Credit Facility.
"Revolving Period" shall have the meaning given to such term in Section
2.04.
"Shareholder" means each Person owning or possessing any Equity
Interest (or right to acquire an Equity Interest by warrant, option or
otherwise).
"Subsidiaries" means and includes any corporation, association, or
other business entity, the majority (by number of votes) of the stock of any
class or classes of which is at the time owned or controlled by the Parent or by
any Subsidiary, if the holders of the stock of such class or classes (i) are
ordinarily, in the absence of contingencies, entitled to vote for the election
of a majority of the directors (or persons performing similar functions) of the
issuer thereof, even though the right so to vote has been suspended by the
happening of any contingency, or (ii) are at the time entitled, as such holders,
to vote for the election of a majority of the directors (or persons performing
similar functions) of the issuer thereof, whether or not the right so to vote
exists by reason of the happening of a contingency.
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"Taxes" means all federal, state and local or foreign income, payroll,
withholding, excise, sales, use, real and personal property, use and occupancy,
business and occupation, mercantile, real estate, capital stock and franchise or
other taxes, including interest and penalties thereon, and including estimated
taxes thereof.
"Total Liabilities" means the aggregate (without duplication) of all
Liabilities of the Companies on a Consolidated basis, as determined in
accordance with GAAP.
"Unfunded Liability" means, with regard to any Plan, the excess of the
present value of accrued benefits under the plan over the current value of the
Plan's assets. Whenever this Agreement requires the amount of any Unfunded
Liability to be determined, it shall be determined as of the beginning of the
most recent Plan year on the final actuarial valuation prepared for the Plan for
funding purposes.
"Valuable Transfer" means, as to any member of the Borrowing Group, to
the extent that deemed to be a Guarantor under Section 3.02 of this Agreement:
(a) all loans, advances or capital contributions made by any other member of the
Borrowing Group to such Guarantor with proceeds of the Revolving Loans to such
other member of the Borrowing Group, (b) all debt securities or other
obligations of any Guarantor acquired by any other member of the Borrowing Group
from such Guarantor with the proceeds of the Revolving Loan made to such other
member of the Borrowing Group, (c) the fair market value of all property
acquired by any other member of the Borrowing Group with proceeds of the
Revolving Loans to such other member of the Borrowing Group and transferred,
absolutely and not as collateral, to such Guarantor, (d) all equity securities
of such Guarantor acquired by any other member of the Borrowing Group from such
Guarantor with proceeds of the Revolving Loans to such other member and (e) the
value of any quantifiable economic benefits not included in clauses (a) through
(d) above, but includable in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors, accruing to such
Guarantor from the other member or members of the Borrowing Group as a result of
the Revolving Loans to such other member or members.
"Wholly-owned Subsidiary" means any Subsidiary the stock of any class
or classes of which is at the time owned and controlled solely by the Parent or
other Company that is a Wholly-owned Subsidiary.
Whenever any agreement, promissory note, intercreditor agreement, or
other instrument or document is defined in this Credit Agreement, such
definition shall be deemed to mean and include, from and after the date of an
amendment, restatement, or modification thereof, such agreement, promissory note
or other instrument or document as amended,
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restated or modified. To the extent that the plural of any term defined herein
is not defined in this Credit Agreement, that usage of the plural in this Credit
Agreement shall mean the plural of the singular term so defined and if the
defined term is plural, usage of the singular of such term shall mean the
singular thereof, in each case as the context so requires. The words "hereof",
"herein" or similar words shall refer to this Credit Agreement and references to
Sections or Articles shall mean Sections or Articles of this Credit Agreement.
Section 1.02 ACCOUNTING TERMS. Any accounting terms used herein and not
defined herein shall have the meaning ascribed to them by, and be determined in
accordance with, GAAP. All computations made pursuant to this Agreement shall be
made in accordance with GAAP consistently applied and all balance sheets and
other financial statements shall be prepared in accordance with GAAP
consistently applied except, with respect to interim financial statements, for
normal recurring year-end adjustments.
ARTICLE II
----------
CREDIT FACILITY
---------------
Section 2.01 AMOUNTS. The Banks hereby establish their respective
several, but not joint, commitments (the "Commitments") in respect of the Credit
Facility. The aggregate amount of the Commitments shall be FORTY FIVE MILLION
DOLLARS ($45,000,000), less the face amount of any outstanding letters of credit
and foreign bank guaranties, but that amount may be reduced from time to time
pursuant to Section 2.02 and the Commitments may be terminated pursuant to
Article X. The amount of each Bank's Commitment (subject to such reduction or
termination), and the proportion (expressed as a percentage) that it bears to
all of the Commitments, is set forth opposite the Bank's name below, to-wit:
- -------------------------------------------------------------------------------
$27,000,000 60% National City Bank
18,000,000 40% NBD Bank
-----------
$45,000,000 100% Total
- -------------------------------------------------------------------------------
Section 2.02 REDUCTION. The Borrowing Group shall have the right at all
times to permanently and irrevocably reduce the Commitments in whole or in part
by giving written notice of the reduction to the Agent at least one (1) Business
Day prior to the reduction, each such reduction to be equal to at least
$1,000,000. Concurrently with each reduction, the Borrowing Group shall prepay
the amount, if any, together with interest thereon, by which the Outstanding
Amount exceeds the Commitments as so reduced. Each reduction shall be allocated
ratably among the Commitments. Section 2.11 shall apply to each such prepayment.
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Section 2.03 SINGLE LOAN. The Outstanding Amount borrowed by the
Borrowing Group from the Banks under the Commitments shall constitute a single
loan from the Banks regardless of how many Advances have been borrowed, repaid
or reborrowed or LCs or Bank Guaranties have been issued or are outstanding.
Section 2.04 ADVANCES; LCS; REVOLVING PERIOD. The Borrowing Group may
obtain (a) Advances in respect of the Revolving Loan from the Banks or (b) LCs
from NCB or (c) Bank Guaranties from a foreign branch of NBD during a period
(the "Revolving Period") commencing as of the Closing Date until (i) the
termination of the Commitments pursuant to any provision hereof or (ii) May 31,
2000, whichever shall first occur, whereupon the Commitments shall be terminated
and no longer be in effect. Each Advance shall be in an amount of not less than
$1,000,000, or multiples of $500,000 in excess thereof. For purposes of
satisfying requirements for minimum amounts in this Agreement, the aggregate
amount thereof (as opposed to any particular amount forwarded to any member of
the Borrowing Group by the Parent as agent for the Borrowing Group) shall be
used. The Borrowing Group shall give the Agent notice on or before 12:00 noon
Cleveland time on the date of an Advance, subject to Section 2.08. Subject to
the other provisions hereof, during the Revolving Period, Advances may be
borrowed, repaid (in accordance with Section 2.12) and reborrowed so long as the
Outstanding Amount outstanding at any one time does not exceed the Commitments.
Section 2.05 INTEREST ON THE REVOLVING LOAN. The Borrowing Group shall
pay interest on the Revolving Loan at the rate per annum determined on the basis
of either the (i) Base Rate and/or (ii) the Overall Libor Rate, as applicable in
accordance with the other provisions of this Agreement (the "Available Rates").
Section 2.06 ELECTION OF BASE RATE FOR REVOLVING LOAN. The minimum
principal amount of the Revolving Loan initially upon which interest may be
determined on the Base Rate shall be $1,000,000 and in multiples of $500,000 in
excess thereof.
Section 2.07 ELECTION OF OVERALL LIBOR RATE FOR REVOLVING LOAN. (i)
Subject to the terms and conditions stated in this Section 2.07 and otherwise in
this Article II, the Borrowing Group may elect to have interest on all or part
of the outstanding principal of that portion of the Revolving Loan to be
determined on the basis of an Overall Libor Rate applicable to the Revolving
Loan. Changes in the Overall Libor Rate based upon changes in the Libor Margin
shall become effective on each April 1, June 1, September 1 or December 1 (the
"Overall Libor Rate Change Dates") first following (by at least two (2) Business
Days) the delivery to the Agent pursuant to Section 6.06(i) or (ii) of the
financial
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statements of the Borrowing Group including, without limitation, the Covenant
Compliance Certificate (as defined in Section 6.06(ii) (z)), demonstrating the
computation of the Borrowing Group's Borrowed Debt/Net Worth and the Fixed
Charge Coverage Ratio (determined on an annualized basis by using the amount of
Cash Flow and Fixed Charges for the Quarter most recently concluded multiplied
by four (4)), provided that the Fixed Charge Coverage Ratio applicable as of
each April 1, shall be determined using the actual Cash Flow and Fixed Charges
for the Borrowing Group's most recently concluded fiscal year. In the event that
the Borrowing Group fails to provide the Agent with a Covenant Compliance
Certificate within at least two business days before the Overall Libor Rate
Change Dates then the Agent may adjust the Overall Libor Rate based on what it
determines to be the Borrowing Group's Borrowed Debt/Net Worth and the Fixed
Charge Coverage Ratio, all as determined in the Agent's sole discretion ("the
Discretional Libor Rate"). Once the Agent has received the financial statements
of the Borrowing Group, including, without limitation, the Covenant Compliance
Certificate, and can determine the actual change in the Overall Libor Rate based
upon changes reflected in such financial statements (the "Actual Overall Libor
Rate") then the Overall Libor Rate shall be adjusted to the Actual Overall Libor
Rate. In the event that the Actual Overall Libor Rate is lower than the
Discretional Overall Libor Rate the Borrowing Group shall not be entitled to any
refund based on the difference in the two rates. In the event that the Actual
Overall Libor Rate is higher than the Discretional Overall Libor Rate then the
Borrowing Group shall immediately pay to the Agent the difference in the two
interest rates for the period that any Advances were outstanding under the
Discretional Overall Libor Rate. In no event shall more than eight (8) Overall
Libor Rates be in effect for the Revolving Loan at any time. If no election is
made by the Borrowing Group as to the Interest Option for determination of
interest on any part of the outstanding principal amount of the Revolving Loan,
interest thereon will be determined at the Base Rate.
(ii) The minimum principal amount of the Revolving Loan initially upon
which interest may be determined on an Overall Libor Rate shall be $1,000,000.00
and in multiples of $500,000 in excess thereof or such lower amount such that
any Borrowing will result in the Bank with the smallest Commitment having at
least a Loan of $1,000,000. The Libor Rate Periods which the Borrowing Group may
elect for interest to be determined on an Overall Libor Rate are approximately
one month, two months, three months, or six months. No Libor Rate Period shall
end on a date after the maturity date of the Revolving Loan for which an Overall
Libor Rate is in effect. The Borrowing Group shall have no right to elect the
use of an Overall Libor Rate if any Event of Default or Possible Default shall
exist at the time of election or immediately upon the effectiveness thereof.
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(iii) Each election of an Overall Libor Rate shall be made by written
or telephonic notice (if telephonic, then promptly confirmed in writing) to the
Agent received by it not later than 11:00 a.m. Cleveland time three (3) Business
Days before the date the Borrowing Group desires to select as the Effective Date
for such Overall Libor Rate. The Borrowing Group, by giving a notice of
election, expressly accepts the particular Overall Libor Rate elected regardless
of any change in financial conditions or markets that may have affected such
Overall Libor Rate after the giving of notice but prior to the Effective Date
thereof. Each notice of election shall specify the principal amount of such
Revolving Loan to which such Overall Libor Rate is applicable and the period for
which such Overall Libor Rate shall be effective.
(iv) The Borrowing Group acknowledges and agrees that as of the date
hereof the Libor Margin is one hundred twenty five (125) basis points (Level 2
in the performance grid).
Section 2.08 NOTICE. The Agent shall give the Borrowing Group and the
Banks prompt notice of any Overall Libor Rate applicable to the Revolving Loan.
In making interest payments, the Borrowing Group shall be entitled to rely upon
the most recent such notice received by it; provided that if any interest
payment shall be made in the wrong amount by reason of the Borrowing Group's
failure to receive a timely notice for any reason or by reason of any error in
computation, the difference between the correct amount and the erroneous amount
shall be promptly paid by the Borrowing Group or promptly refunded to the
Borrowing Group (in either case with interest based on the amount of the
difference and computed at the rate or rates applicable to the principal in
question), whichever is applicable.
Section 2.09 LIMITS ON OVERALL LIBOR RATE ELECTIONS. The right of the
Borrowing Group to elect the use of an Overall Libor Rate for the purposes of
determining interest on the Revolving Loan shall at all times be subject to the
following:
(I) availability of funding or its functional equivalent
to the Banks to allow the election of such Overall
Libor Rate;
(II) that the basis for determining such Overall Libor
Rate will adequately and fairly reflect the cost to
the Banks of maintaining or funding the Overall Libor
Rate so elected; and
(III) the Banks do not reasonably believe that it is
prohibited from or otherwise restricted by applicable
law or regulatory requirement in allowing the Banks
to elect such Overall Libor Rate.
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Section 2.10 COMPENSATION; ILLEGALITY. (a) If, after the date hereof,
there shall be introduced or changed any treaty, statute, law, regulation or
other governmental requirement, or there shall be any change in the
interpretation or administration thereof by any governmental authority charged
with the administration or interpretation thereof, or there shall be made any
request from any central bank or other lawful governmental authority having
jurisdiction over a Bank, this Credit Agreement, the Revolving Loan or the
Revolving Notes, which introduction, change or compliance shall, upon becoming
effective, (i) impose, modify or deem applicable any reserve or special deposit
or other requirements against assets held by or deposits in or loans by a Bank
or (ii) subject a Bank to any tax, duty, fee, deduction or withholding or (iii)
change the basis of taxation of payments due from the Borrowing Group (otherwise
than by a change in taxation of the overall net income of the Banks) or (iv)
impose on a Bank any penalty in respect of any maintaining any Revolving Loan,
and any such event increases the cost to a Bank to maintain a Revolving Loan or
reduces the amount of principal or interest received by a Bank in respect of
this Credit Agreement or any Revolving Loan, then upon such Bank's demand, the
Borrowing Group shall pay to such Bank from time to time such additional amounts
as will compensate and reimburse such Bank for such increased cost or reduced
amount. Each demand for compensation shall be accompanied by such Bank's
certificate setting forth in reasonable detail the amount to be paid by the
Borrowing Group and the computations used in determining the amount, which
certificate shall be Conclusive. In determining any such amount, a Bank may use
any reasonable averaging and attribution methods.
(b) In the event that any applicable law treaty, rule or regulation
(whether domestic or foreign) now or hereafter in effect and whether or not
presently applicable to a Bank or any interpretation or administration thereof
by any governmental authority charged with the interpretation or administration
thereof, or compliance by a Bank with any guideline, request or directive of any
such authority (whether or not having the force of law), affects or would affect
the amount of capital required or expected to be maintained by a Bank or any
corporation controlling a Bank, as the case may be, and such Bank determines
that the amount of such capital is increased by or based upon the existence of a
Bank's obligations under this Agreement and such increase has the effect of
reducing the rate of return on a Bank's or such controlling corporation's
capital as a consequence of its obligations hereunder to a level below that
which such Bank or such controlling corporation could have achieved but for such
circumstances (taking into consideration its policies with respect to capital
adequacy) by an amount deemed by such Bank to be material, then the Borrowing
Group shall pay to such Bank, from time to time, upon request by such Bank
additional amounts sufficient to compensate such Bank for any increase in the
amount of capital and reduced rate of return which such Bank reasonably
determine to be allocable to the existence of such Bank's obligations hereunder.
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(c) In the event that any applicable law, treaty, rule or regulation
(whether domestic or foreign) now or hereafter in effect and whether or not
presently applicable to the Banks, or any interpretation or administration
thereof by any governmental authority charged with the interpretation or
administration thereof, or compliance by the Banks with any guideline, request
or directive of such authority (whether or not having the force of law),
including, without limitation, exchange controls, shall make it unlawful for the
Banks to maintain or offer a Revolving Loan under this Credit Agreement, the
Banks may, upon the occurrence of such an event, refuse to offer any Revolving
Loan to the Borrowing Group or to maintain any Revolving Loan and, in the event
that the part of the Revolving Loan that it is unlawful to maintain are only
that part of the Revolving Loan bearing interest at an Overall Libor Rate, the
Borrowing Group may convert such part of the Revolving Loan to bear interest at
the Overall Base Rate subject to the provisions of Section 2.13.
Section 2.11 INTEREST PAYMENT DATES. Interest on the Revolving Loan
that is being determined by an Overall Libor Rate shall be paid in arrears to
the Agent for the ratable benefit of the Banks at the end of each Libor Rate
Period, except that for any Libor Rate Period in excess of three months,
interest shall be paid at the end of three months and the end of the Libor Rate
Period. If any Libor Rate Period for an Overall Libor Rate would end on a date
that is not a Business Day then such Libor Rate Period shall end on the next
succeeding Business Day unless such next succeeding Business Day would occur in
the next succeeding calendar month in which case the Libor Rate Period will end
on the immediately preceding Business Day. Interest on the Revolving Loan that
is being determined on the Base Rate shall be paid in arrears to the Agent for
the ratable benefit of the Banks on the last day of Quarter or the next
succeeding Business Day if such date is not a Business Day, prior to the payment
in full of the Revolving Loan. All unpaid and accrued interest shall be due and
payable on the respective final maturity or acceleration of the Revolving Loan.
Section 2.12 VOLUNTARY PREPAYMENTS. Subject to the provisions contained
in this Section 2.12, the Borrowing Group, at its option, may prepay without
premium or penalty all or any part of the Revolving Loan upon which interest is
being determined at Base Rate. Upon any prepayment of part of any Revolving Loan
upon which interest is being determined in accordance with an Overall Libor
Rate, the Borrowing Group will pay to the Agent for the ratable benefit of the
Banks the Overall Libor Rate Indemnity. The Borrowing Group shall give the Agent
notice on or before 1:00 p.m. Cleveland time not less than one (1) Business Day
prior to any voluntary prepayment of the Revolving Loan. Any notice of payment
or payment made after 1:00 p.m. Cleveland time will be deemed made as of the
next following Business Day.
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Section 2.13 APPLICATION OF PAYMENTS TO REVOLVING LOAN. The payments of
principal required on the Revolving Loan will be applied in the following order
of priority:
(A) to each principal amount of such Revolving Loan upon which
interest is determined in accordance with an Overall Libor Rate having
a Libor Rate Period ending on the date such payment of principal is
due;
(B) to each principal amount of the Revolving Loan upon which
interest is being determined in accordance with the Base Rate; and
(C) lastly, any remaining amount shall be applied as a
prepayment to the principal amounts of the Revolving Loan upon which
interest is being determined in accordance with an Overall Libor Rate
that is in excess of the amounts specified in clause (A) above.
Section 2.14 OVERALL LIBOR RATE INDEMNITY. The Borrowing Group shall
jointly and severally compensate and pay to the Agent for the benefit of the
Banks for any costs and expenses (whether internal or external) (an "Overall
Libor Rate Indemnity"), as determined by the Banks in their sole discretion
(including, without limitation, loss of profit, any interest paid by the Banks
to lenders of funds borrowed by it to fund and carry the portion of the
Revolving Loan upon which interest is being determined on an Overall Libor Rate
and any loss sustained by the Banks in connection with the reemployment of such
funds), which the Banks may sustain if: (1) any payment or prepayment of that
portion of the Revolving Loan bearing interest at the Overall Libor Rate
(including, without limitation, as a consequence of any conversion of a
Revolving Loan bearing interest at an Overall Libor Rate to a Revolving Loan
bearing interest at an Overall Base Rate or any Event of Default or Possible
Default under this Agreement) occurs on a date which is not the last day of a
Libor Rate Period applicable thereto or (2) any repayment is not made on any
date specified in a notice of repayment given by the Borrowing Group.
Section 2.15 INTEREST CALCULATIONS. All of the interest payable on the
Revolving Loan shall be computed on a 360-day-per-year basis for the actual
number of days elapsed. All payments to be made by the Borrowing Group under
this Credit Agreement and the Revolving Notes shall be made in immediately
available funds by 1:00 p.m., Cleveland time, to the Agent for the ratable
benefit of the Banks and any payment received after such time shall be deemed
received on the next following Business Day. Except as set forth in Section 2.11
above, whenever any payment under this Credit Agreement and the Revolving Notes
shall be due on any day that is not a Business Day, the date for payment thereof
shall be extended to the next succeeding Business Day. If the due date for any
such payment is so
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extended or extended for any other reason, including operation of law, or any
payment is received after a due date, interest shall accrue and be payable on
demand for such extended time.
Section 2.16 LATE CHARGE; POST-DEFAULT RATE. In the event that any
payment of principal or interest on the Revolving Loan is not paid on the date
due (including any applicable grace period), the Borrowing Group agrees to pay a
late charge of $500. After the occurrence and during the continuance of any
Event of Default, the Revolving Loan shall bear interest at a rate equal to the
Post-Default Rate from and after the date of such Event of Default, which
interest shall be due on demand but paid not less frequently than monthly on the
first day of each calendar month.
Section 2.17 COMMITMENT FEE. The Borrowing Group shall pay to the
Agent for the ratable benefit of the Banks a commitment fee for the Commitments
as follows:
(i) the commitment fee will be based upon the average daily
difference between (A) the Outstanding Amount and (B) the Commitments
in effect;
(ii) the commitment fee will be computed at the rate of 3/8 of
1% per annum (computed on the basis of a 360 day year and the actual
number of days elapsed); and
(iii) the commitment fee will be paid quarterly in arrears
commencing on September 30, 1997, thereafter on the last day of each
Quarter and on the termination of the Commitments.
Section 2.18 REPAYMENT OF THE REVOLVING LOAN; THE REVOLVING NOTES. The
unpaid principal balance of the Revolving Loan shall be due and payable on the
last day of the Revolving Period but in any event no later than on June 30,
2000. In addition, at any time and from time to time, the Borrowing Group shall
no later than the next following Business Day repay the Revolving Loan to the
extent that the Outstanding Amount exceeds the Commitment. The joint and several
obligation of the Borrowing Group to pay the principal of and interest on the
Revolving Loan ratably to the Banks shall also be evidenced by the Revolving
Notes to be issued to the Banks and which shall be dated the Execution Date. The
unpaid principal balance of and interest accrued on the Revolving Loan shall be
determined by the ledgers and records of the Banks as accurately maintained in
accordance with the Banks' ordinary practices to reflect Advances and under this
Credit Agreement and shall be Conclusive.
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Section 2.19 LETTERS OF CREDIT.
(a) The Agent agrees that so long as all of the Commitments remain in
effect, the Agent will, in NCB's name but only as Agent for the Banks, issue
such letters of credit (each, an "LC") for the account of the Borrowing Group or
any subsidiary of the Borrowing Group, all as the Parent may from time to time
request subject, however, to the conditions of this Agreement.
(b) NBD agrees that so long as (i) all of the Commitments remain in
effect, and (ii) NBD has an affiliate(s) which issues Bank Guaranties, NBD's
affiliate will in NBD's name, issue such Bank Guaranties for the account of PSI
if PSI may from time to time request subject, however, to the conditions of this
Agreement.
Section 2.20 RATABLE PARTICIPATION IN LCS. Each issuance of a LC or a
Bank Guaranty shall, of itself, confer upon each Bank the benefits and
liabilities of a participation constituting an undivided interest in the LC or
Bank Guaranty to the extent of that Bank's ratable share.
Section 2.21 MAXIMUM.
(a) The Agent shall not issue any LC if, after giving effect
thereto,
(i) the aggregate undrawn balance of all then
outstanding LCs and Bank Guaranties would exceed Fifteen
Million Dollars ($15,000,000) or
(ii) the aggregate unpaid principal of the Revolving
Loans plus the aggregate undrawn balance of all then
outstanding LCs and Bank Guaranties would exceed the aggregate
Credit Exposure of all the Banks.
(b) NBD's affiliate shall not issue any Bank Guaranty if,
after giving effect thereto:
(x) the aggregate undrawn balance of all then
outstanding LCs and Bank Guaranties would exceed Fifteen
Million Dollars ($15,000,000) or
(y) the aggregate unpaid principal of the Revolving
Loans plus the aggregate undrawn balance of all then
outstanding LCs and Bank Guaranties would exceed the aggregate
Credit Exposure of all Banks.
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Section 2.22 TERM. No LC shall permit any draft to be drawn thereunder
on a date that is later than one (1) year after the date of the LC nor later
than the third (3rd) banking day immediately preceding the end of the Revolving
Period. No Bank Guaranty shall expire on the date that is later than one (1)
year after the date of that Bank Guaranty or later than the third (3rd) banking
day immediately preceding the end of the Revolving Period.
Section 2.23 FORM. Each LC shall be issued in such form as Agent may
reasonably require and may be either
(a) a commercial letter of credit issued for the importation
of goods in the ordinary course of the Borrowing Group's businesses; or
(b) a standby letter of credit issued for general corporate
purposes in the ordinary course of business.
Each Bank Guaranty shall be issued in substantially the form of
Schedule 2.23 hereto, with the blanks appropriately filled.
Section 2.24 FEES. The Borrowing Group agrees, in respect of each LC
and the drafts thereunder, (whether issued for the account of the Borrowing
Group or a subsidiary), to pay NCB for NCB's sole account such issuance,
amendment, negotiation, draw, acceptance, telex and similar transactional fees
as are generally charged by NCB under its standard fee schedule as in effect
from time to time. The Borrowing Group agrees, in respect of each Bank Guaranty
issued on behalf of PSI, to pay NBD or its affiliate for NBD's or such
affiliate's sole account such issuance, amendment, negotiation, telex and
similar transactional fees as are generally charged by NBD or its affiliate for
Bank Guaranties.
Section 2.25 COMMISSIONS. The Borrowing Group agrees to pay:
(a) to the Agent, in respect of each LC and the drafts
thereunder (whether issued for the account of the Borrowing Group or a
Subsidiary), for the ratable accounts of the Banks a commission which,
shall be based on the daily undrawn balance thereof, shall be computed
at the rate set forth in the performance grid contained in the
definition of Libor Margin, and shall be paid in arrears on the last
day of each Quarter and shall be non-refundable, and
(b) to NBD or its affiliate, in respect of each Bank Guaranty,
for the ratable account of the Banks, a commission which shall be based
on the daily undrawn balance thereof, shall be computed at the rate set
forth in the perormance grid contained in the definition of Libor
Margin, and shall be paid in arrears on the last day
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of each Quarter and shall be non-refundable. Such commission shall be
payable in Dollars or their equivalent as determined by NBD (or its
affiliate) based on the exchange rate then in effect.
Each of the Agent and NBD shall provide to each Bank within two
Business Days after each payment of commissions that Bank's ratable share of
commissions received by the Agent in respect of LCs or NBD in respect of Bank
Guaranties during the Quarter then ending.
Section 2.26 REIMBURSEMENT. The Borrowing Group agrees that whenever
the Agent pays any draft or other item pursuant to or otherwise in respect of
any LC and whenever NBD pays any amount pursuant to or otherwise in respect of
any Bank Guaranty, the Borrowing Group will reimburse the Agent or NBD, as
applicable, for the amount so paid immediately upon demand. In the event that
any such reimbursement is not made, then the Borrowing Group shall be deemed to
have made a Borrowing of a Revolving Loan in a principal amount equal to the
amount to be reimbursed, all subject to the terms and conditions of this
Agreement, except that a Borrowing made under this Section shall be made even if
an Event of Default or Possible Default shall then exist or immediately
thereafter exist. The Agent shall immediately disburse the proceeds of such
Borrowing to the Agent or NBD as applicable, to satisfy the aforesaid
reimbursement liability.
Section 2.27 FOREIGN CURRENCIES. Whenever a LC or Bank Guaranty is
denominated in any currency other than dollars, the provisions of this Section
2.27 shall apply:
(a) The fees and commissions referred to in Sections 2.24 and
2.25 shall be based on the dollar equivalent of the foreign currency on
the date of payment and shall be paid in dollars.
(b) The reimbursements referred to in subsection 2.25 shall be
made in the dollar equivalent of the foreign currency as determined on
the date of payment.
(c) The dollar equivalent of all outstanding LCs and Bank
Guaranties denominated in any currency other than dollars shall be
determined for purposes of this paragraph as of the first banking day
of each month. If, after giving effect to that determination, the
limits set forth in Section 2.21 shall be exceeded, the Borrowing Group
shall, in the case of a violation of subsections (a)(ii) and (b)(z) of
Section 2.21, immediately reduce the aggregate Credit Exposure of the
Banks first by making a prepayment in respect of the Revolving Loan in
an aggregate principal amount equal to that excess (or, if the then
aggregate principal balance of the Revolving Loan is less
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than the excess, equal to that aggregate principal balance); and if the
sum of the aggregate Credit Exposure shall still be in excess of the
aggregate amount of the subject Commitments, or in the case of a
violation of subsection (a)(i), (b)(x) or (b)(y) of Section 2.21, the
Borrowing Group shall, immediately upon the demand of the Agent or NBD,
as applicable, deposit with the party making the demand, as security
for the Borrowing Group's obligation to reimburse the Agent or NBD and
the Banks in respect of any LCs and Bank Guaranties then outstanding,
cash or Acceptable Marketable Securities having a fair cash value equal
to the amount by which the sum of the aggregate undrawn balance of any
then outstanding LCs and Bank Guaranties exceeds the limits in Section
2.21.
Section 2.28 PURPOSE OF THE REVOLVING LOAN.
(i) The proceeds of the Revolving Loan and LCs shall be used
by the Borrowing Group to finance the Cryenco Acquisition, to refinance
existing indebtedness and for working capital and general corporate
purposes in accordance with the provisions of this Credit Agreement.
The proceeds of the Bank Guaranties shall be used by PSI for working
capital and general corporate purposes in accordance with the
provisions of this Credit Agreement.
(ii) Each of the Borrowing Group hereby acknowledges that it
has equal and unrestricted right to obtain proceeds of the Revolving
Loan and/or LCs for its purposes as set forth in paragraph (i) of this
Section 2.28. The fact that the Parent will act in its capacity as
representative of all of the members of the Borrowing Group to request
from the Agent an Advance and/or an LC is merely administrative in
nature.
Section 2.29 EVENT OF DEFAULT OR POSSIBLE DEFAULT. The Borrowing Group
shall not be entitled to obtain the any Advances, LC or Bank Guaranty, or elect
an Overall Libor Rate if, at the time of so obtaining or requesting such
Advance, LC or Bank Guaranty or electing any Overall Libor Rate, any Event of
Default or Possible Default shall then exist or immediately thereafter exist.
Receipt by the Borrowing Group of any Advances, LC or Bank Guaranty, or election
by the Borrowing Group of an Overall Libor Rate shall, each in and of itself,
constitute a continuing representation and warranty by the Borrowing Group that
the representations and warranties in Article IV continue (except to the extent
given as of and limited to a specific date) to be accurate in all material
respects and that the Borrowing Group then is entitled under this Credit
Agreement to obtain the Advances, LC or Bank Guaranty or elect an Overall Libor
Rate, as the case may be.
Section 2.30 AGENT FEES. The Borrowing Group shall pay to the Agent
an annual
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agent fee stated in a separate letter agreement between the Agent and the
Borrowing Group, which fee is payable at closing and each June 30th thereafter.
ARTICLE III
-----------
INTERCOMPANY MATTERS
--------------------
Section 3.01 APPOINTMENT OF PARENT AS AGENT. Each of the Borrowing
Group, jointly and severally, hereby appoints the Parent as their respective
agent for the purpose of giving and receiving notice relating to this Agreement,
to receive the proceeds of any Advance, making any election of any Overall Libor
Rate, to request the issuance of an LC and to do other things that any of the
Borrowing Group may do under this Agreement. All references to the Parent in
this Agreement when the context so indicates that it is acting as agent for
itself and the Borrowing Group shall be deemed to be a reference to all of the
Borrowing Group. All of the Borrowing Group, jointly and severally, agree that
each shall be bound and obligated by the acts of the Parent with respect to the
exercise of the functions set forth in this Section 3.01 and hereby confirm and
ratify any such acts the Parent shall make in such capacity. No revocation or
modification of the foregoing appointment of the Parent as such agent for the
Borrowing Group, the revocation or acceptance of such appointment by the Parent
and the effect thereof, shall be effective as to the Banks without the prior
written consent of the Majority of the Banks thereto. Unless and until the Agent
accepts the revocation or modification of the foregoing appointment of the
Parent, the individual members of the Borrowing Group may not, except through
the Parent as their agent, perform or exercise any of the functions for which
the agency is created pursuant to this Section 3.01.
Section 3.02 INTERCOMPANY GUARANTY.
a) Each of the Borrowing Group hereby unconditionally and irrevocably,
jointly and severally guarantees to the Banks (a) the due and punctual payment
of each of the obligations of the other members of the Borrowing Group to the
Bank, including, but not limited to, the due and punctual payment of all
Obligations and of all other sums now or hereafter owed by any Borrower to the
Bank under this Agreement or any of the Loan Documents (whether by acceleration
or otherwise) and according to the terms hereof and thereof (the foregoing to be
collectively referred to as the "Guaranteed Obligations"); PROVIDED, HOWEVER
that the maximum amount of the Guaranteed Obligations of any of the Borrowing
Group under this Section 3.02(a) shall not at any time exceed the Maximum
Guaranteed Amount in respect of such member of the Borrowing Group.
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b) The Obligations of the Borrowing Group under this Section 3.02 shall
be joint and several, irrevocable, unconditional and absolute and, without
limiting the generality of the foregoing, shall not be released, discharged or
otherwise affected by (a) any extension, renewal, settlement, compromise, waiver
or release in respect of any obligation of any Revolving Loan under this
Agreement or any Loan Document by operation of law or otherwise; (b) any
modification or amendment of or supplement to this Agreement or any other Loan
Document; (c) any modification, amendment, waiver, release, non-perfection or
invalidity of any direct or indirect security, or of any guarantee or other
liability of any third party, for the Guaranteed Obligations of any of the
Borrowing Group (d) any change in the corporate existence, structure, or
ownership of, or any insolvency, bankruptcy, reorganization or other similar
proceeding affecting any of the Borrowing Group or its assets or any resulting
release or discharge of any of the Guaranteed Obligations of any of the
Borrowing Group, the Banks or any other Person, whether or not arising in
connection with this Agreement or other Loan Document; PROVIDED, HOWEVER, that
nothing shall prevent the assertion of any such claim by separate suit or
compulsory counterclaim; (f) any invalidity or unenforceability relating to or
against any of the Borrowing Group for any reason, of this Agreement or any
other Loan Document or any provision of applicable law or regulation purporting
to prohibit the payment by any of the Borrowing Group under this Agreement or
any other Loan Document; or (g) to the extent permitted by applicable law, any
other act or omission to act or delay of any kind by any of the Borrowing Group,
the Bank(s) or any other Person or any other circumstance whatsoever that might,
but for the provisions of this paragraph, constitute a legal or equitable
discharge of the Obligations of any of the Borrowing Group under this Section
3.02.
(c) Each of the Borrowing Group's Obligations under this Section 3.02
shall remain in full force and effect until all Commitments hereunder are
terminated and Revolving Loans and all amounts payable by any of the Borrowing
Group under this Agreement or any other Loan Document shall have been paid in
full. If at any time any payment of any amount payable by any of the Borrowing
Group under this Section 3.02 of this Agreement, any other section of this
Agreement or other Loan Document is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of any of the
Borrowing Group or otherwise, the obligations of the other members of the
Borrowing Group under this Section 3.02 with respect to such payment shall be
reinstated at such time as though such payment had become due but had not been
made at such time. This Section 3.02(c) shall survive the termination of this
Agreement and the payment in full of all amounts payable under the Revolving
Notes and in respect of this Agreement or other Loan Document.
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(d) No member of the Borrowing Group shall have any right of
subrogation, reimbursement or contribution and each member hereby waives any
right to enforce any remedy which the Banks now have or may hereafter have
against any of the Borrowing Group, any endorser or any other guarantor, of all
or any part of the Guaranteed Obligations, and each of the Borrowing Group
hereby waives any benefit of, and any right to participate in, any security or
collateral given to the Banks to secure payment of the Guaranteed Obligations or
any other liability of any other Borrowing Group to the Banks. Each member of
the Borrowing Group also waives all setoffs and counterclaims and all
presentments, demands of performance, notices of nonperformance, protests,
notices of protest, notices of dishonor, and notices of acceptance of this
Guaranty. Each member of the Borrowing Group further waives all notices of the
existence, creation or incurring of new or additional indebtedness, arising
either from additional loans extended to any other member of the Borrowing Group
or otherwise, and also waives all notices that the principal amount, or any
portion thereof, and/or any interest on any instrument or document evidencing
all or any part of the Guaranteed Obligations is due, notices of any and all
proceedings to collect from the maker, any endorser or any other guarantor of
all or any part of the Guaranteed Obligations, or from anyone else, and, to the
extent permitted by law, notices of exchange, sale, surrender or other handling
of any security or other collateral given to the Banks to secure payment of the
Guaranteed Obligations.
(e) If acceleration of the time for payment of any amount payable by
any of the Borrowing Group under this Agreement or other Loan Document is stayed
upon the insolvency, bankruptcy or reorganization of any of the Borrowing Group
all such amounts otherwise subject to acceleration under the terms of this
Agreement shall nonetheless be payable by the other members of the Borrowing
Group hereunder forthwith on demand by the Banks.
Section 3.03 FURTHER ASSURANCES. Each Company in the Borrowing Group
agrees to execute and deliver such additional agreements, documents and
instruments as may be reasonably required to evidence their agreement pursuant
to this Article III. This Article III is intended for the respective benefit of
each Company in the Borrowing Group.
ARTICLE IV
----------
REPRESENTATIONS AND WARRANTIES OF THE BORROWING GROUP
-----------------------------------------------------
Each member of the Borrowing Group for itself and CHD represents and
warrants to the Banks and the Agent as follows:
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Section 4.01 ORGANIZATION OF THE COMPANIES; BUSINESS AND PROPERTY; CHD.
Each of the Companies is duly organized and validly existing corporations in
good standing under the laws of the states set forth in Schedule 4.01. Each of
the Companies has all requisite corporate power and authority to execute and
deliver the Loan Documents executed or to be executed by it and to carry out the
provisions thereof. each of the Companies has full corporate power, authority,
and legal right to own and operate its respective properties and to carry on the
business in which it engages and intend to engage. Each of the Companies is
qualified or otherwise entitled to do business and is in good standing in the
states set forth in Schedule 4.01 and no qualification is required in any other
jurisdiction by reason of the Companies's business, activities, or ownership of
property, other than such jurisdictions in which the failure to qualify would
not have a Material Adverse Effect. CHD is exempt from Delaware corporation
income tax by operation of Title 30 Delaware Code section 1902(b)(8).
Attached hereto as SCHEDULE 4.01 is a true and correct summary, as of
the date hereof, of the capital structure, including all capital stock and
Indebtedness for Borrowed Money (excluding the Revolving Loan) of the Companies,
which lists in Part I, each person owning or holding any Equity Interest in
excess of five percent (5%) and, lists in Part II, each Person (other than the
Banks) owning or holding any evidence of Indebtedness for Borrowed Money of the
Companies. Part I of SCHEDULE 4.01 shows the number of shares of preferred or
common stock which each Person holding Equity Interests in excess of five
percent (5%) owns or is entitled to own, the class thereof and the percentage
interest of such class and Part II of SCHEDULE 4.01 shows the face amount of
each evidence of Indebtedness for Borrowed Money, and the stated maturity
thereof.
Section 4.02 AUTHORIZATION; VALIDITY. The Borrowing Group have taken
all corporate action necessary to authorize the execution, delivery and
performance by it of the Loan Documents executed and to be executed by it. This
Credit Agreement is, and each of the other Loan Documents when executed and
delivered will be, legal, valid and binding upon the Borrowing Group and
enforceable against the Borrowing Group in accordance with their respective
terms. No consent, approval, or authorization of, or registration or declaration
with, any governmental authority or other Person is required in connection with
the execution, delivery and performance by the Borrowing Group of any of the
Loan Documents other than such as have been obtained and copies of which have
been furnished to the Banks.
Section 4.03 PERMITS. Each of the Companies has all permits, licenses
or authorizations from all federal, state or local governmental authority (a
"Governmental Authority") necessary to operate the Facilities and no default
exists under any such permit, license or authorization, which, either the
failure of the Companies to have or the default under, would have a Material
Adverse Effect. None of the Companies is subject to any
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outstanding or, to the knowledge of the Borrowing Group, threatened citation by
any Governmental Authority which would have a Material Adverse Effect.
Section 4.04 FINANCIAL STATEMENTS. The Consolidated balance sheet of
the Parent as of March 31, 1997 and the consolidating balance sheets of the
Companies as of March 31, 1997 and the related statements of revenues and
expenses and changes in financial position for the periods then ended and the
auditors' reports with respect to the fiscal year ended December 31, 1996,
copies of which have heretofore been furnished to the Banks, are complete and
correct and fairly present the consolidated financial condition, changes in
financial position and results of operations of the Companies at such dates and
for such period, and were prepared in accordance with GAAP.
Section 4.05 FINANCIAL CONDITION AT DATE OF CREDIT AGREEMENT. Except
for Liabilities created pursuant to this Credit Agreement and for the Cryenco
Acquisition, as of the Closing Date, the Companies have no material amount of
Liabilities, contingent or otherwise, whether or not required to be reflected in
accordance with GAAP, which are not reflected in the Balance Sheets, nor any
outstanding or existing commitments for the purchase of land, buildings,
equipment, materials, or supplies, or any contracts for services except for
those made in the ordinary course of business.
Section 4.06 NO ADVERSE CHANGES. Since March 31, 1997, there has been
no Material Adverse Effect in the condition, financial or otherwise, of the
Companies, and the business, operations, and properties, including the
Facilities, of any of the Companies have not been substantially and adversely
affected in any way as a result of any fire, explosion, earthquake, accident,
labor disturbance, requisition or taking of property by any governmental
authority, flood, riot, or act of God except where no Material Adverse Effect
resulted therefrom.
Section 4.07 TITLE TO PROPERTIES; PATENTS, TRADE MARKS, ETC. Each of
the Companies have good and marketable title to the Facilities and all of their
respective properties and assets. There are no Liens of any nature whatsoever on
any of the properties or assets of any of the Companies other than Permitted
Exceptions. Each of the Companies own or possess all the patents, trademarks,
service marks, trade names, copyrights, and licenses and rights with respect to
the foregoing necessary for the conduct of its business as it is now conducted,
without any known conflict with the valid rights of others which would be
inconsistent with the conduct of its business substantially as now conducted and
as currently proposed to be conducted and the failure of which to own or possess
would have a Material Adverse Effect.
Section 4.08 LITIGATION. There are no outstanding judgments against,
or actions, suits or proceedings pending, or to the best knowledge of the
Borrowing Group, threatened against
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or affecting any of the Companies, at law or in equity or before or by any
federal, state, local or other governmental department, commission, board,
bureau, agency or instrumentality, which, if adversely determined, involves the
possibility of any judgment or liability not fully covered by insurance or which
may result in any Material Adverse Effect.
Section 4.09 LIABILITIES. None of the Companies have any outstanding
Liabilities other than as expressly permitted pursuant to this Agreement.
Section 4.10 COMPLIANCE WITH OTHER INSTRUMENTS. None of the Companies
is in material default in the performance, observance, or fulfillment of any of
the material obligations, covenants, or conditions contained in (i) any evidence
of Indebtedness for Borrowed Money, or (ii) any agreement, document, lease or
other instrument which a default under, violation of which or a failure to
perform on the part of the Companies would have a Material Adverse Effect.
Neither the execution and delivery of this Credit Agreement or the other Loan
Documents, nor the consummation of the transactions contemplated thereby, nor
will compliance with the terms and provisions thereof violate the provisions of
any applicable law or of any material applicable order or regulations of any
governmental authority having jurisdiction of the parties (excluding the Banks)
to this Credit Agreement or the other Loan Documents, or, except where no
Material Adverse Effect would result therefrom, conflict with or result in a
breach of any agreement or instrument to which any of the Companies is now a
party, or, except where no Material Adverse Effect would result therefrom, will
constitute a default thereunder, or will result in the creation or imposition of
any lien, charge, or encumbrance of any nature whatsoever upon any of the
properties or assets of any of the Companies except in favor of the Agent for
the benefit of the Banks.
Section 4.11 MATERIAL RESTRICTIONS. Except for the Loan Documents, none
of the Companies is a party to any agreement or other instrument or subject to
any other restriction which causes a Material Adverse Effect.
Section 4.12 CORRECTNESS OF DATA FURNISHED. This Credit Agreement and
all Schedules and Exhibits hereto do not contain any untrue statement of a
material fact or omit a material fact necessary to make the statements contained
therein or herein not misleading; and there is no fact not otherwise disclosed
in writing to the Banks which, to the knowledge of the Borrowing Group, would
cause a Material Adverse Effect.
Section 4.13 ERISA. Every employee pension benefit plan, if any,
maintained by any of the Companies which has been treated for federal tax
purposes as a qualified plan (if any) under Section 401(a) of the Code is so
qualified (or an application for such qualification is pending and the Companies
know of no reason why such plan will not receive such
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qualification), and its related funding vehicle is tax exempt to the extent
provided by the Code, except where such failure would not have a Material
Adverse Effect. None of the Companies has engaged in a transaction with respect
to any Plan, or any other employee benefit plan, which would or could subject
any of the Companies to a tax or penalty imposed by either Section 4975 of the
Code or Section 502(i) of ERISA, except where no Material Adverse Effect would
result therefrom. No Plan has had an accumulated funding deficiency, whether or
not waived, which would have a Material Adverse Effect. No Reportable Event,
which would have a Material Adverse Effect, has occurred with respect to any
Plan. No liability, which would have a Material Adverse Effect, to the PBGC has
been incurred and is unpaid, or is expected to be incurred, by the Companies
with respect to any Plan. No event or condition referred to in Section 4042(a)
of ERISA exists which presents a material risk of termination of any Plan by the
PBGC, which termination would result in a Material Adverse Effect. No proceeding
or other action, which would have a Material Adverse Effect, has been initiated
by the PBGC to terminate any Plan nor has written notice been given to any of
the Companies of an intention to commence or seek the commencement of any such
proceeding or action. None of the Companies has withdrawn nor do they expect to
withdraw from any multi-employer plan or multiple employer plan, excluding any
such withdrawal that may be accomplished without any liability, which would have
a Material Adverse Effect, or any such withdrawal as to which any resulting
liability has been paid in full. The total potential withdrawal liability to the
Companies under all multi-employer plans, less the aggregate Unfunded
Liabilities would not have a Material Adverse Effect. Under each employee
pension benefit plan (if any) maintained by any of the Companies which is
required to be funded under ERISA, as of the last day of the most recent plan
year, the then aggregate current value of all accrued benefits under each such
plan (as determined on the basis of the actuarial assumptions and methods
contained in the plan's most recent actuarial valuation of liabilities) did not
exceed the aggregate current value of the assets of such plan, except Unfunded
Liabilities which, in the aggregate, would not have a Material Adverse Effect.
Each employee benefit plan (if any) maintained by the Companies has been
administered in compliance with its terms, except where the failure to do so
would not have a Material Adverse Effect The term "current value" has the same
meaning as in Section 4062(b)(1) of ERISA (as in effect prior to the amendment
made by the Consolidated Omnibus Budget Reconciliation Act of 1985) and the term
"accrued benefit" has the same meaning specified in Section 3 of ERISA. As used
in this Agreement, (i) "accumulated funding deficiency" shall have the meaning
assigned to such term in Section 412 of the Code and Section 302 of ERISA; (ii)
"employee pension benefit plan," "employee benefit Plan," "multi-employer plan"
and "Plan Year" shall have the respective meanings assigned to such terms in
Sections 3 and 4001 of ERISA; (iii) "multiple employer plan" means a single
employer plan which has two or more contributing sponsors at least two of whom
are not under common control, within the contemplation of Sections 4063 and 4064
of ERISA; (iv)
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"single employer plan" shall have the meaning assigned to such term in Section
4001 of ERISA; and (v) "withdrawal liability" shall include the liabilities
established by Sections 4063, 4064 and 4201 of ERISA.
Section 4.14 TAXES. As of the date hereof, each of the Companies has
(a) timely filed all returns required to be filed by them with respect to all
Taxes, (b) paid all Taxes shown to have become due pursuant to such returns, and
(c) paid all other Taxes for which a notice of assessment or demand for payment
has been received by the Companies, except where the failure to do so would not
have a Material Adverse Effect. As of the date hereof, all tax returns of the
Companies have been prepared in accordance with all applicable laws and
requirements and accurately reflect the taxable income (or other measure of Tax)
of the Companies. As of the date hereof, each of the Companies has timely filed
all information returns or reports which are required to be filed and has
accurately reported all material information required to be included on such
returns or reports. As of the date hereof, there are no proposed assessments of
Taxes against the Companies nor any proposed adjustments to any Tax return
filed. As of the date hereof, none of the Companies has ever (i) filed any
consent or agreement under Section 341(f) of the Code, (ii) executed a waiver or
consent extending any statute of limitations for any Tax liability which remains
outstanding, (iii) joined in or been required to join in filing a consolidated
or combined Tax return, except that of the Parent, (iv) applied for a Tax ruling
other than a determination letter with respect to a qualified employee benefit
plan, (v) entered into a closing agreement with any taxing authority, or (vi)
filed an election under 338(g) or Section 338(h)(10) of the Code or caused or
permitted a deemed election under Section 338(e) thereof to occur.
Section 4.15 COMPLIANCE WITH LAWS. Each of the Companies is, and the
Facilities have been operated, in compliance in all material respects with all
material laws, rules, regulations, court orders and decrees, and orders of any
governmental agency which are applicable to the Companies or the Facilities,
except where the failure to do so would not have a Material Adverse Effect.
Section 4.16 ENVIRONMENTAL MATTERS. No Company has ever: (a) been
legally responsible for any release or threat of release of any Hazardous
Material, the effect of which responsibility would have a Material Adverse
Effect, or (b) except as otherwise disclosed in Schedule 4.16 attached hereto,
received notification of the incurrence of any expense in connection with the
assessment or Environmental Remediation of any Hazardous Material for which that
Company would be responsible and the effect of which would be a Material Adverse
Effect.
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Section 4.17 LEASES. Each of the Companies enjoys peaceful and
undisturbed possession under the leases and other agreements and documents to
which it is a party as lessee or holder of any other real property interest or
under which they are operating, except to the extent that no Material Adverse
Effect results therefrom.
Section 4.18 REGULATION U, ETC. None of the Companies owns, nor, except
for the Cryenco Acquisition, does any of them have any present intention of
acquiring, any "margin stock" within the meaning of Regulation U (12 CFR Part
221) of the Board of Governors of the Federal Reserve System (herein called
"margin stock"). None of the proceeds of any of the Revolving Loan will be used,
directly or indirectly, by any of the Companies for the purpose of purchasing or
carrying, or for the purpose of reducing or retiring any indebtedness or other
liability which was originally incurred to purchase or carry, any margin stock
(except for the Cryenco Acquisition) or for any other purpose which might cause
the transactions contemplated hereby to be considered a "purpose credit" within
the meaning of said Regulation U, and none of the proceeds of the Revolving Loan
will be used for any purpose which might cause this Credit Agreement to violate
Regulation G, Regulation U, Regulation T, Regulation X, or other regulation of
the Board of Governors of the Federal Reserve System or the Securities Exchange
Act of 1934. Upon request, each of the Companies will promptly furnish the Banks
with a statement in conformity with the requirements 1 Reserve Form U-I referred
to in said Regulation U.
Section 4.19 HOLDING COMPANY ACT. None of the Companies is a "Holding
Company" or a "Subsidiary Company" of a "Holding Company", or an "Affiliate" of
a "Holding Company", as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended.
Section 4.20 SECURITIES ACT, ETC. Neither the registration of any
security under the Securities Act of 1933, as amended, or any other federal,
state, or local securities laws, nor the qualification of the Loan Documents, as
amended, is required in connection with the Revolving Loan or the issuance and
delivery of the Revolving Notes pursuant hereto.
Section 4.21 SOLVENCY. Each of the Companies (except for Chart
Management) is solvent and has assets having a fair value in excess of the
amount required to pay its probable liabilities on its existing debts as they
become absolute and matured, and has access to adequate capital for the conduct
of its business and the ability to pay its debts from time to time incurred in
connection therewith as such debts mature.
Section 4.22 NO DEFAULT. No Possible Default or Event of Default has
occurred and is continuing.
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Section 4.23 EMPLOYEE CONTROVERSIES. There are no controversies pending
or, to the best of the Borrowing Group's, threatened or anticipated between any
of the Companies and any of their employees that would have a Material Adverse
Effect.
Section 4.24 BROKERS, ETC. The Borrowing Group have not caused the
Banks to be under any obligation to pay any broker's fees, finder's fee or
commission in connection with the Revolving Loan or the transactions
contemplated by the Credit Agreement.
ARTICLE V
---------
CONDITIONS TO BORROWING
-----------------------
Part I
CONDITIONS PRECEDENT TO EFFECTIVENESS OF THE REVOLVING LOAN. The
obligation of the Banks to make the first Advances or issue the first LC shall
be subject to the satisfaction of the following conditions prior to or
concurrently therewith.
Section 5.01 REPRESENTATIONS AND WARRANTIES. The representations and
warranties contained in Article IV shall be true in all material respects on and
as of the time of the first Advance hereunder, with the same effect as if made
on and as of such date unless stated as of a specific date.
Section 5.02 NO DEFAULTS. There shall exist no condition or event
constituting an Event of Default or Possible Default.
Section 5.03 PERFORMANCE. The Borrowing Group shall have performed and
complied with all agreements and conditions contained herein required to be
performed or complied with by it prior to or at the time of the first Advance.
Section 5.04 CLOSING CERTIFICATE. The Borrowing Group shall have
delivered to the Banks a certificate dated the date of the first Advance and
signed by an Authorized Fiscal Officer of the Borrowing Group, certifying to the
matters covered by the conditions specified in Sections 5.01, 5.02 and 5.03.
Section 5.05 INSURANCE REPORT. The Borrowing Group shall have delivered
to the Banks the insurance report required by Section 6.05.
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Section 5.06 REVOLVING NOTES/PLEDGE AGREEMENT. The Banks shall have
received the Revolving Notes and the Pledge Agreement, accompanied by all
documents and instruments required hereunder, duly executed and delivered by the
parties thereto.
Section 5.07 DISBURSEMENT INSTRUCTIONS. The Banks shall have received
disbursement instructions and supporting documentation from the Borrowing Group
evidencing that the proceeds of the first Advance are being applied in
accordance with Section 2.28.
Section 5.08 OPINIONS OF COUNSEL FOR THE BORROWING GROUP. The Banks
shall have received the favorable opinion of Calfee, Halter & Griswold, as
counsel for the Borrowing Group, in form attached as SCHEDULE 5.08.
Section 5.09 CORPORATE PROCEEDINGS. Each Company in the Borrowing Group
shall have delivered to the Banks, all dated as of the Closing Date (or as of a
date recent to the Closing Date):
(i) a copy of its certificate of incorporation, certified by
an authorized public officer of the state of its incorporation;
(ii) certificates of good standing from or authority to
transact business or similar certificates from each state referred to
in Section 4.01 where it has places of business or maintains records,
in all cases from the Secretary of State or comparable officer of such
jurisdiction;
(iii) a copy of its by-laws certified by its secretary;
(iv) resolutions of its Board of Directors authorizing the
execution, delivery and performance of the Loan Documents (including,
without limitation, this Credit Agreement, and the Revolving Notes
issued pursuant hereto) and the consummation of the transactions
contemplated thereby, certified by its secretary; and
(v) an incumbency certificate certifying the names of its
officers and their signatures, certified by its secretary.
Section 5.10 PAYMENT OF EXPENSES. The Borrowing Group shall have paid,
or reimbursed the Banks for, the amounts required to be paid or reimbursed by
the Borrowing Group pursuant to Section 12.01 of this Credit Agreement,
including, without limitation, the fees and expenses of Kahn, Kleinman, Yanowitz
& Arnson Co., L.P.A.
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Section 5.11 SCHEDULES. The Banks shall have received and approved (in
their sole discretion) each of the Schedules attached hereto.
Section 5.12 OTHER DOCUMENTS. The Banks shall have received such other
certificates, opinions, agreements and documents as it shall reasonably request
and the Banks, in their sole discretion, shall be satisfied with the condition,
financial and otherwise, of the Borrowing Group.
Section 5.13 SOLVENCY CERTIFICATE. The Banks shall have received a
certificate executed by the Chief Financial Officer or Treasurer (or, with
respect to AI, the Assistant Secretary) for each of the Companies (except for
Chart Management) certifying that:
(a) To the best knowledge of such Company, the fair value of
the assets of each Company will exceed the debts and liabilities, direct,
subordinated, contingent or otherwise, of such Company;
(b) To the best knowledge of such Company, the present fair
salable value of the property of such Company will be greater than the amount
that will be required to satisfy any probable liability of such Company on its
debts and other liabilities, direct, subordinated, contingent or otherwise, as
such debts and other liabilities become absolute and matured;
(c) Such Company will be able to pay its debts and
liabilities, direct, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and
(d) Such Company will not have unreasonably small capital with
which to conduct the business in which it is engaged as such business
is now conducted and is proposed to be conducted, in each case,
following the dates hereof.
Part II
CONDITIONS PRECEDENT TO THE SUBSEQUENT ADVANCES OR OVERALL LIBOR RATE
ELECTION. Subsequent to the first Advance, the obligation of the Banks to make
additional Advances, issue an LC or implement the election of an Overall Libor
Rate shall be subject to the satisfaction of the following conditions prior to
or concurrently with such action:
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Section 5.14 NO DEFAULTS. There shall exist no condition or event
constituting an Event of Default or Possible Default.
Section 5.15 PERFORMANCE. The Borrowing Group shall have performed and
complied with all material agreements and conditions contained herein required
to be performed or complied with by it prior to or at the time of such action.
Section 5.16 REPRESENTATIONS AND WARRANTIES. The representations and
warranties contained in Article IV shall be true in all material respects on and
as of the time of such action, with the same effect as if made on and as of such
date, unless stated as of a specific date, after giving effect to such updated
information, reflecting transactions not prohibited by the terms of this Credit
Agreement, as is necessary to make such representations and warranties true in
all material respects as of such date.
Section 5.17 CERTIFICATE. If requested by the Agent, the Borrowing
Group shall have delivered to the Banks a certificate dated the date of such
action and signed by the chief financial officer of the Borrowing Group,
certifying to the matters covered by the conditions specified in Sections 5.13,
5.14 and 5.15.
Section 5.18 CRYENCO. Upon the consummation of the Cryenco Acquisition,
each of Cryenco and each of its subsidiaries, as one of the Companies and a
member of the Borrowing Group, shall have executed a counterpart of this Credit
Agreement and an allonge to each Revolving Note, and shall be bound by the terms
hereof, as if it shall have been an original signatory hereto. In addition, all
of the conditions contained in Part I of this Article V shall be required to be
satisfied with respect to Cryenco and such subsidiaries.
ARTICLE VI
AFFIRMATIVE COVENANTS OF THE BORROWING GROUP
Until all principal of and interest on the Revolving Loan and the
Revolving Notes and all other obligations, liabilities and indebtedness of the
Borrowing Group to the Banks under this Credit Agreement have been paid in full,
including, without limitation, reimburse any drawing made or that may be made on
any LC, and the Commitments have expired:
Section 6.01 PAYMENT OF AMOUNTS DUE. The Borrowing Group will, jointly
and severally, make all payments of the principal of and interest on the
Revolving Loan and the Revolving Notes promptly as the same become due under
this Credit Agreement and/or the Revolving Notes.
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Section 6.02 EXISTENCE, BUSINESS, ETC. Each Company will cause to be
done all things necessary to preserve and to keep in full force and effect its
corporate existence and rights. Each Company will comply in all material
respects with all federal, state, and local laws and regulations material to its
business now in effect or hereafter promulgated by any properly constituted
governmental authority having jurisdiction except to the extent that compliance
therewith is being contested in good faith by appropriate proceedings or where
the failure to comply would not have a Material Adverse Effect. In connection
with and without limiting the generality of the foregoing, each Company will
take all action which may be required to comply with all such laws and material
regulations now in effect or hereafter promulgated by any federal, state, and
local governmental organization having jurisdiction over the Facilities, except
to the extent that the failure to take such action would not have a Material
Adverse Effect.
Section 6.03 MAINTENANCE OF PROPERTIES. Each Company will at all times
maintain, preserve, protect, and keep its properties (except to the extent no
longer used or useful) used in the conduct of its business in good repair,
working order, and condition, ordinary wear and tear excepted, and, from time to
time, make all needful and proper repairs, renewals, replacements necessary
thereto, so that the business carried on in connection therewith may be properly
conducted, except where the failure to comply would not have a Material Adverse
Effect.
Section 6.04 PAYMENT OF TAXES, ETC. Each Company will pay and discharge
all lawful Taxes, assessments, and governmental charges or levies imposed upon
it, or upon its income or profits, or upon any of its properties, before the
same shall become in default, as well as all lawful claims for labor, materials,
and supplies which, if unpaid, might become a lien or charge upon such
properties or any part thereof; provided, however, no Company shall be required
to pay and discharge any such tax, assessment, charge, levy, or claim so long as
the validity thereof shall be contested in good faith by appropriate proceedings
and there shall be set aside on its respective books such reserves with respect
thereto as are required by GAAP. Each Company will in all events pay such tax,
assessment, charge, levy or claim before the property subject thereto shall be
sold to satisfy any lien which has attached thereto. Without limiting the
foregoing, each of the Companies will (a) timely filed all returns required to
be filed by them with respect to all Taxes, (b) pay all Taxes shown to have
become due pursuant to such returns, and (c) pay all other Taxes for which a
notice of assessment or demand for payment has been received by any Company, in
each case the failure of which would have a Material Adverse Effect; provided,
however, no Company shall be required to pay and discharge any such tax,
assessment, charge, levy, or claim so
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long as the validity thereof shall be contested in good faith by appropriate
proceedings and there shall be set aside on its respective books such reserves
with respect thereto as are required by GAAP. None of the Companies will (i)
file any consent or agreement under Section 341(f) of the Code, (ii) execute a
waiver or consent extending any statute of limitations for any Tax liability
which remains outstanding, (iii) enter into a closing agreement with any taxing
authority, or (vi) file an election under 338(g) or Section 338(h)(10) of the
Code or caused or permitted a deemed election under Section 338(e) thereof to
occur, which in each case would have a Material Adverse Effect.
Section 6.05 INSURANCE. Each Company will keep adequately insured, by
financially sound and reputable insurers, all properties of a character usually
insured by business entities engaged in the same or similar activities and
business against loss or damage resulting from fire or other risks insured
against by extended coverage and maintain in full force and effect public
liability insurance against claims for personal injury, death or property damage
occurring upon, in, or about any properties occupied or controlled by it, or
through the operation of any motor vehicles or aircraft by its agents or
employees, or arising in any manner out of the business carried on by it, all in
such amounts as the Agent may from time to time reasonably request. Each Company
will deliver to the Agent on or before the date of the first Advance hereunder
and at such other times as material changes may be effected in the insurance
coverage of each Company, certificates of the chief financial officer of the
Parent containing a statement of the policies of insurance covering the risks
described herein in effect on the date of such certificate and a statement that
such policies comply with the provisions of this subsection.
Section 6.06 ACCOUNTS AND REPORTS OF EACH COMPANY. Each Company will
maintain a standard system of accounting in accordance with GAAP and furnish to
the Banks the following reports:
(i) As soon as available, and in any event within ninety
(90) days after the end of each Fiscal Year of the
Parent, a complete audited accountant's report with
respect thereto (including without limitation, all
financial statements of the Companies, together with
all notes thereto, prepared in reasonable detail and
certified, as to the Consolidated statements only)
without qualification by independent certified public
accountants that are one of the "Big 6" national
firms (the "Accountant"), and certified by the chief
financial officer of Parent, which report shall
contain (x) a Consolidated and consolidating balance
sheet of the Companies, (y) a Consolidated and
consolidating statement of income and expense of the
Companies, and (z) a Consolidated statement of
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cash flow of the Parent. The Borrowing Group shall
also deliver or cause delivery to the Banks of copies
of any "management letters" issued by the Accountant
to the Borrowing Group, as soon as available, and in
any event within one hundred fifty (150) days after
the end of any Fiscal Year;
(ii) As soon as available, and in any event within
forty-five (45) days after the end of each Quarter,
an unaudited report for the most recently concluded
Quarter, certified by the chief financial officer of
the Parent, which report shall contain (v) a
Consolidated and consolidating balance sheet of the
Companies as at the end of such Quarter, (w) a
Consolidated income and expense statement of each
Company for such month, including a year to date
income and expense statement and a comparison to the
budget, all prepared in accordance with GAAP subject
to normal recurring year-end adjustments, (x) a
statement that the examination made in preparing and
certifying such report has not disclosed the
existence of any condition or event which constitutes
an Event of Default or Possible Default, or, if such
a condition or event exists, specifying the nature
thereof, (y) an accounts receivable aging by account
debtor for each of the Borrowing Group and (z) a
statement (a "Covenant Compliance Certificate) as to
compliance with certain covenants and containing
appropriate calculations, to be prepared in form and
detail satisfactory to the Majority of the Banks
(initially in the form of SCHEDULE 6.06 attached
hereto) and to which shall be attached a
jobs-in-progress report prepared in accordance with
GAAP for each of the Borrowing Group as at the end
of that Quarter, setting forth on a
percentage-of-completion basis all jobs that were in
progress during that Quarter and which are required
by GAAP to be accounted for on a
percentage-of-completion basis;
(iii) As soon as available, and in any event within fifteen
(15) days after the end of each Fiscal Year of each
Company, a good faith forecast, on a Consolidated and
consolidating basis, of the Companies' operations and
Capital Expenditures for the following Fiscal Year,
in form and substance reasonably satisfactory to
Majority of the Banks;
(iv) Promptly upon request, any other information
regarding the accounts receivable and the finished
goods, work in process and raw material inventories
of the Borrowing Group;
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(v) Immediately after any member of the Borrowing Group
knows of, or shall have knowledge of, the occurrence
of any condition or event which constitutes an Event
of Default or Possible Default, notice of such
condition or event and the action which the Borrowing
Group proposes to take with respect thereto;
(vi) Copies of all financial statements, audits, and
public reports which any of the Companies may have
made of or concerning their accounts, books, or
records, and which they have provided to any third
party, but excluding such items furnished solely to
an Affiliate;
(vii) Promptly after filing, a copy of each annual report
(and related schedules) filed by each Company with
any governmental authority or agency in respect of
any employee pension benefit plan subject to ERISA;
and
(viii) Promptly upon request, such other information
respecting the business, properties, operations or
condition (financial or otherwise) of each Company as
the Banks may from time to time reasonably request
(all such information to be in such form and detail
as the Banks shall reasonably request).
Section 6.07 INFORMATION AND INSPECTION. The Borrowing Group will
furnish to the Banks, from time to time, upon the request by the Banks, full
information pertinent to any covenant, provision, or condition of this Credit
Agreement or of any other loan document or to any matter in connection with its
activities and business, and at all reasonable times and, prior to the
occurrence of a Possible Default or Event of Default, upon not less than one
Business Day's notice but with no prior notice after the occurrence of a
Possible Default or Event of Default, and as often as the Banks may reasonably
request, permit any authorized representative designated by the Banks to visit
and inspect (which visits and inspections shall be at the Borrowing Group's sole
expense after the occurrence and during the continuance of any Possible Default
or Event of Default and at the Banks' sole expense at any other time) during
normal business hours any of its properties, including its books (and to take
extracts therefrom) and to discuss its affairs, finances, and accounts with its
officers and employees.
Section 6.08 NOTICE OF LITIGATION. The Borrowing Group will promptly
notify the Banks in writing of any litigation, legal proceeding or threat of
legal proceeding (i) with any Person, including, without limitation, the
Governmental Authorities and any member of the
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staff or any representative of any such Person, which involves the threat of
termination of any agreements or contracts which are material to the operations
of the Borrowing Group; or (ii) involving amounts in excess of $250,000,
affecting the Borrowing Group, unless fully covered by insurance without
reservation with deductibles of less than One Hundred Fifty Thousand Dollars
($150,000).
Section 6.09 PENSION PLANS. Each Company shall (i) keep in full force
and effect any plans which are presently in existence or may, from time to time,
come into existence under ERISA, unless such Plans can be terminated without a
Material Adverse Effect, (ii) make contributions to each of the plans and all
multi-employer plans in a timely manner and in a sufficient amount to comply
with the requirements of ERISA except where no Material Adverse Effect would
result therefrom, (iii) comply with all material requirements of ERISA which
relate to such Plans and multi-employer plans except where no Material Adverse
Effect would result therefrom, and (iv) notify the Banks immediately upon
receipt by any Company of any notice of the institution of any proceeding or
other action which may result in the termination of any Plan. The term
"multi-employer plan" shall have the meaning assigned to it in Section 5.13. For
purposes of this Credit Agreement, "ERISA liabilities" means the aggregate
liability (whether or not arising under ERISA) of the Companies, incurred as a
result of actions inconsistent with the covenants set forth in Section 8.17 or
that are or would be incurred following the termination of any Plan described in
Section 10.12.
Section 6.10 HAZARDOUS MATERIAL. Each Company shall: (a) dispose of any
Hazardous Material only in compliance with all Environmental Laws, and (b) not
have possession of any Hazardous Material other than in the ordinary course of
that Company's business and in compliance with all Environmental Laws, except
where no Material Adverse Effect would result therefrom.
Section 6.11 NET WORTH. The Borrowing Group will have and maintain a
Consolidated Net Worth in an amount not less than the aggregate of: (i)
$27,000,000, plus (ii) at the end of each Quarter, an amount equal to
twenty-five percent (25%) of the Borrowing Group's Consolidated Net Income (if a
positive number otherwise, 0) for all Quarters ending after the date hereof,
plus (iii) 100% of the amount of the proceeds received by the Companies from any
Equity Offering, as of the date of issuance or conversion of the applicable
Equity Interest.
Section 6.12 LEVERAGE. The Borrowing Group will have and maintain at
all times a Leverage Ratio of not more than 2.85 to 1.0.
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Section 6.13 PRETAX INTEREST COVERAGE RATIO. The Borrowing Group will
have and maintain at all times a Pretax Interest Coverage Ratio of not less than
3.5 to 1.0 for each Quarter (based on the cumulative results for the most
recently concluded Four-Quarter Period) until the end of the Revolving Period
and payment in full of the Outstanding Amount.
Section 6.14 FIXED CHARGE COVERAGE RATIO. The Borrowing Group will have
and maintain at all times a Fixed Charge Coverage Ratio of not less than 1.25 to
1.0, which will be calculated based on the cumulative results for the
most-recently concluded Four-Quarter Period.
Section 6.15 CURRENT RATIO. The Borrowing Group will have and maintain
at all times a ratio of Current Assets to Current Liabilities of not less than
1.15 to 1.0.
Section 6.16 CONTROL OF PARENT. Charles Holmes and Arthur Holmes shall
at all times own at least 25% of the common stock of Parent.
Section 6.17 POST-CLOSING ITEMS. The Borrowing Group will promptly
perform and complete to the satisfaction of the Banks each of the matters, if
any, set forth on SCHEDULE 6.17 attached hereto (the "Listed Matters") on or
before the date set forth on SCHEDULE 6.17 for the performance and completion
thereof (the "Satisfaction Date").
Section 6.18 FURTHER ASSURANCES. The Borrowing Group agrees to execute
and deliver to the Banks any agreements, documents and instruments, including,
without limitation, additional Revolving Notes as replacement or substitutions
as may be required by the Banks, and to take such other actions as reasonably
requested by the Banks to effect the transactions contemplated hereby.
ARTICLE VII
-----------
NEGATIVE COVENANTS OF THE BORROWING GROUP
-----------------------------------------
Until all principal of and interest on the Revolving Loan and the
Revolving Notes and all other obligations, liabilities, and indebtedness of the
Borrowing Group to the Banks under this Credit Agreement have been paid in full
including, without limitation, reimburse any drawing made or that may be made on
any LC, and the Commitments have expired:
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Section 7.01 LIMITATION OF INDEBTEDNESS. No Company will create, incur,
assume, become or be liable in any manner in respect of, any Liabilities except:
(i) Liabilities in respect of the Credit Facility;
(ii) unsecured current Liabilities for the purchase of
goods and services and deferred Liabilities, in each
case, incurred in the ordinary course of business
(excluding Indebtedness for Borrowed Money or
represented by bonds, notes, or other securities);
(iii) unsecured Liabilities in respect of performance
bonds, raw material purchase or futures contracts,
customer deposits, accrued commissions, salaries,
wages and other compensation, warranty obligations
and sales representative and distributor agreements,
in each case, to the extent incurred in the ordinary
course of business;
(iv) secured current Liabilities (other than Indebtedness
for Borrowed Money or represented by bonds, notes, or
other securities) incurred in the ordinary course of
business, but only if permitted to be secured
pursuant to clause (ii), (iii) or (iv) of Section
7.02;
(v) Liabilities for taxes, assessments, all charges,
liens, or similar claims to the extent that payment
thereof shall not yet be due or if the obligation to
pay is being contested in good faith by appropriate
proceedings and adequate reserves with respect
thereto shall have been set aside on the books of the
Companies but in any event only so long as the sale
of property subject to such Lien is not imminent by
reason of non-payment;
(vi) Secured Indebtedness for Borrowed Money, including
Capitalized Leases, incurred to acquire Capital or
Fixed Assets, so long as the amount thereof does not
exceed the purchase price of such Fixed or Capital
Assets and the aggregate outstanding amount does not
exceed $2,000,000;
(vii) Secured Indebtedness for Borrowed Money in respect of
Capitalized Leases existing on the date hereof and
described in SCHEDULE 7.01(VII) attached hereto but
no refinancing, extension, enlargement or increase
thereof;
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(viii) any indebtedness owing by a Company (except CHD,
unless the CHD Guaranty Documents shall have
theretofore been duly executed and delivered to the
Banks and the Agent) to a Company (except CHD, unless
the CHD Guaranty Documents shall have theretofore
been duly executed and delivered to the Banks and the
Agent);
(ix) any progress payment received in the normal course of
business;
(x) any Indebtedness for Borrowed Money described on
SCHEDULE 7.01 attached hereto.
Each of the foregoing types of indebtedness and liability being
referred to collectively as the "Permitted Indebtedness."
Section 7.02 LIMITATION ON LIENS. No Company will create, incur,
assume, or suffer to be created, or incurred, or assumed, or to exist, any Lien
of any kind on any of its properties or assets, or own or acquire, or agree to
acquire any property of any character subject to or upon any mortgage,
conditional sale agreement, or other title retention agreement; provided,
however, that the foregoing restrictions shall not prohibit:
(i) any tax lien, or any lien securing workers'
compensation or unemployment insurance obligations,
or any mechanic's carrier's or landlord's lien, or
any lien arising under ERISA, or any security
interest arising under article four (bank deposits
and collections) or five (letters of credit) of the
Uniform Commercial Code, or any similar security
interest or other lien, EXCEPT that this clause (i)
shall (A) apply only to security interests and other
liens arising by operation of law (whether statutory
or common law) and in the ordinary course of business
and shall not apply to any security interest or other
lien that secures any indebtedness for borrowed money
or any guaranty thereof or any obligation that is in
material default in any manner (other than any
default if it is contested in good faith by timely
and appropriate proceedings effective to stay
enforcement of the security interest or other lien in
question and if an appropriate reserve for the amount
of the liability in question shall have been
established) and (B) not apply to any security
interest or other lien upon any property of CHD,
unless the CHD Guaranty Documents shall have
theretofore been duly executed and delivered to the
Banks and the Agent;
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(ii) zoning or deed restrictions, public utility easements, minor
title irregularities and similar matters having no Material
Adverse Effect as a practical matter on the ownership or use
of any of the property in question, EXCEPT that this clause
(ii) shall not apply to any such restriction, easement, title
irregularity or similar matter encumbering or otherwise
affecting any property of CHD unless the CHD Guaranty
Documents shall have theretofore been duly executed and
delivered to the Banks and the Agent;
(iii) any lien securing or given in lieu of surety, stay, appeal or
performance bonds, or securing performance of contracts or
bids (other than contracts for the payment of money borrowed),
or deposits required by law or governmental regulations or by
any court order, decree, judgment or rule or as a condition to
the transaction of business or the exercise of any right,
privilege or license, EXCEPT that this clause (iii)
(A) shall apply only if and so long as the
aggregate unpaid balance or all obligations
so secured (except any referred to in clause
(vi)) does not exceed ten million dollars
($10,000,000) at any one time outstanding,
(B) shall not apply to any lien or deposit
securing an obligation that is in material
default in any manner (other than any
default contested in good faith by timely
and appropriate proceedings effective to
stay enforcement of the security interest or
other lien in question and if an appropriate
reserve for the amount of the liability in
question shall have been established, and
(C) shall not apply to any lien upon any
property of CHD, unless the CHD Guaranty
Documents shall have theretofore been duly
executed and delivered to the Banks and the
Agent;
(iv) any Lien in favor of the Agent for the ratable
benefit of the Banks;
(v) any mortgage, capitalized lease, security interest or
other lien (each, a "purchase money security
interest") which is created or assumed in purchasing,
constructing or improving any real property or
equipment (other than any property or equipment of
CHD, unless the CHD Guaranty Documents shall have
theretofore been duly executed and delivered to the
Banks and the Agent) or to which any such property is
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subject when purchased, PROVIDED, that (A) the
purchase money security interest shall be confined to
the aforesaid property, (B) the indebtedness secured
thereby (which may include a refinancing in whole or
in part of the original indebtedness) does not exceed
the total cost of the purchase, construction or
improvement, and (C) any such indebtedness, if repaid
in whole or in part, cannot be reborrowed;
(vi) any Lien disclosed on SCHEDULE 7.02 attached hereto;
and
(vii) any financing statement perfecting a security
interest that would be permissible under this Section
7.02.
Each of the foregoing Liens, exceptions, and charges being referred to
collectively as the "Permitted Exceptions."
Section 7.03 GUARANTEES. Except for Permitted Indebtedness and
Investments permitted pursuant to Section 7.05, no Company will Guarantee, or
otherwise become surety in respect of the obligations of, or lend its credit to,
any other person, or enter into any working capital maintenance or similar
agreement.
Section 7.04 LEASES. No Company will:
(i) lease any Fixed or Capital Assets where the lease
would be required to be capitalized under Statement
of Financial Accounting Standards No. 13, as from
time to time in effect except as permitted by clauses
(vi) or (vii) of Section 7.01;
(ii) lease any property from any Affiliate on terms less
favorable than such Person could obtain from another
Person who is not an Affiliate; or
(iii) any lease (other than any Capitalized Lease) so long
as the aggregate annual rentals of all such leases of
all the Companies do not exceed Nine Hundred Twenty
Five Thousand dollars ($925,000), EXCEPT that this
clause (iii) shall not apply to any lease to which
CHD is a party unless the CHD Guaranty Documents
shall have theretofore been duly executed and
delivered to the Banks and the Agent,
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Section 7.05 INVESTMENTS, REVOLVING LOAN, AND ADVANCES. No Company will
purchase or otherwise acquire, hold or make any Investment, or enter into any
arrangement for the purpose of making any Investment, except that this Section
7.05 shall not prohibit:
(i) any existing or future advance commission or
relocation payment, or other loan or advance made to
a director, officer or employee of any company
(except CHD, unless the CHD Guaranty Documents shall
have theretofore been duly executed and delivered to
the Banks and the Agent), PROVIDED that the aggregate
made to all directors, officers and employees shall
not exceed two hundred fifty thousand dollars
($250,000) at any one time outstanding;
(ii) any existing or future investment by any Company
(except CHD, unless the CHD Guaranty Documents shall
have theretofore been duly executed and delivered to
the Banks and the Agent) in Acceptable Marketable
Securities;
(iii) any LC or any Guarantee of any Liability of any
Company to the Banks and the Agent or any thereof if
the Guarantee is required by this Agreement;
(iv) any reimbursement obligation of any Company (except
CHD, unless the CHD Guaranty Documents shall have
theretofore been duly executed and delivered to the
Banks and the Agent) in respect of any surety or
performance bond securing the performance of a
contract (except any for the payment of money
borrowed), PROVIDED, that (A) each obligation is
entered into in the normal course of that Company's
business consistent with its past (or industry-wide)
practice and (B) the aggregate liability of the
Companies in respect of the foregoing (including,
without limitation, those referred to in clause (iii)
of Section 8.02) does not exceed Ten Million Dollars
($10,000,000) at any time outstanding;
(v) any Guarantee by Parent of (A) any current liability
owing by any of its Subsidiaries (except CHD, unless
the CHD Guaranty Documents shall have theretofore
been duly executed and delivered to the Banks and the
Agent), or (B) the performance or payment under any
contract or bid for contract by any of its
subsidiaries (except CHD, unless the CHD Guaranty
Documents shall have theretofore been duly executed
and
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delivered to the Banks and the Agent), if and to the
extent that the aggregate liabilities (including,
without limitation, contingent liabilities computed
at the maximum amount for which Parent may be liable
under each such Guarantee) under all Guarantees
permitted by this clause (B) does exceed an amount
equal to Ten Million Dollars ($10,000,000) at any
time;
(vi) any Investment by the Parent in stocks or equity
securities of existing Subsidiaries or any other
member of the Borrowing Group;
(vii) any Investment permitted pursuant to the provisions
of Sections 7.07 or 7.11;
(viii) any existing investment, advance, loan or guaranty
fully disclosed in SCHEDULE 7.05 attached hereto; and
(ix) any endorsement of a check or other medium of payment
for deposit or collection, or any similar transaction
in the normal course of business.
Section 7.06 ASSIGNMENT OR SALE OF ACCOUNTS OR REVOLVING NOTES
RECEIVABLE. No Company will assign, sell, discount, or otherwise dispose of any
accounts, accounts receivable, notes receivable or trade acceptances except for
credits to customers in the ordinary course of business.
Section 7.07 LIQUIDATION, MERGER, OR CONSOLIDATION. No Company will
dissolve or liquidate, or consolidate with or merge with or into any person,
firm, corporation or entity or otherwise effect any business combination with
any person, firm, corporation or entity except that this Section 7.07 shall not
prohibit:
(i) any
(A) merger or consolidation involving only
Subsidiaries (including, without limitation,
any acquired in a contemporaneous
transaction permitted by clause (ii) of this
Section 7.07), PROVIDED FURTHER, that a
Wholly-owned Subsidiary (other than CHD,
unless the CHD Guaranty Documents shall have
theretofore been duly executed and delivered
to the Banks and
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the Agent) shall be the surviving or
resulting entity in the case of any such
merger or consolidation involving a
Wholly-owned Subsidiary, or
(B) merger involving only the Parent and its
Subsidiaries in which the Parent is the
surviving corporation, or any dissolution
and liquidation of a Subsidiary (other than
ALTEC unless the CHD Guaranty Documents
shall have theretofore been duly executed
and delivered to the Banks and the Agent),
or any transfer of the assets of a
subsidiary to the Parent or to a
Wholly-owned Subsidiary (other than CHD,
unless the CHD Guaranty Documents shall have
theretofore been duly executed and delivered
to the Banks and the Agent).
(ii) any transaction (other than any to which CHD is a
party, unless the CHD Guaranty Documents shall have
theretofore been duly executed and delivered to the
Banks and the Agent) unless the aggregate of all
considerations received, paid or otherwise given, and
Liabilities assumed, by the Companies in all such
transactions and any transaction permitted as an
exception to Section 7.11 during any Four-Quarter
Period would exceed five hundred thousand dollars
($500,000); or
(iii) the Cryenco Acquisition.
Section 7.08 AMENDMENT OF CERTIFICATE OF INCORPORATION AND/OR BY-LAWS.
No Company will materially amend, modify, or supplement its certificate of
incorporation and/or its by-laws.
Section 7.09 DISTRIBUTIONS; PURCHASES OR REDEMPTION OF STOCK;
DIVIDENDS. (i) The Parent will not make or pay (or obligate itself to make or
pay) any dividend, Distribution or any other payment in respect of any of the
shares of its capital stock, or redeem, purchase, otherwise acquire for any
consideration (directly or indirectly) any of the shares of its capital stock
except for:
(a) the payment of an annual cash dividend which shall
not exceed Four Million Dollars ($4,000,000) in any
Fiscal Year, which may be declared and paid only so
long as no Possible Default or Event of Default
exists on the date of declaration or payment thereof;
and
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(b) purchases of common shares of the Parent's capital
stock (I) for purposes of (A) making contributions to
the Companies' 401(k) Plans, or (B) in connection
with employee stock option plans or (II) in an open
market transaction, but, in each case, only so long
as no Possible Default or Event of Default results
from such purchase; and
(ii) Unless and until the CHD Guaranty Documents shall have been duly executed
and delivered to the Banks and the Agent, ALTEC shall not make or commit itself
to make any Distribution to CHD except any Distribution that is
(a) made solely and exclusively for the purpose of
enabling CHD to pay any ordinary and necessary
business expense of CHD consistent with its status as
a tax exempt corporation under Title 30 Delaware Code
section 1902(b)(8) or any tax liability (except any
income tax liability to the State of Delaware or any
interest thereon or penalty in respect thereof) of
CHD consistent with its status as a tax exempt
corporation under Title 30 Delaware Code section
1902(b)(8) and
(b) actually used by CHD, within one banking day of CHD's
receipt thereof, solely and exclusively for the
purpose of paying the expense or liability for which
that distribution was made.
Any Distribution permitted pursuant to the provisions of subsections (i) and
(ii) of this Section 7.09 being herein referred to as a "Permitted
Distribution".
Section 7.10 DISPOSITION OF ASSETS. No Company will sell, lease or
otherwise dispose of any part of its Assets, including without limitation, any
Equity Interests, except for sales of inventory or other tangible personal
property in the ordinary course of business, and sales not in the ordinary
course of business in an amount not in excess of $200,000 in any Fiscal Year.
Section 7.11 ACQUISITION OF GOING CONCERN BUSINESS. No Company will
acquire property or assets of any character, real or personal, tangible or
intangible, constituting a going concern business, or the stock or partnership
or other equity interests of a corporation, or other business entity
constituting a going partnership or other business entity constituting a going
concern business except that Greenville may complete the Cryenco Acquisition and
except for any transaction (other than any to which CHD is a party, unless the
CHD Guaranty Documents shall have theretofore been duly executed and delivered
to the Banks and the Agent) unless the aggregate of all considerations received,
paid or otherwise given, and
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Liabilities assumed, by the Companies in all such transactions and any
transaction permitted as an exception to Section 7.07 during any Four-Quarter
Period would not exceed five hundred thousand dollars ($500,000).
Section 7.12 PURCHASE OF FIXED OR CAPITAL ASSETS. The Companies will
not, during any Fiscal Year make any Capital Expenditures (net after trade-ins,
if any) more than an amount equal to the sum of
(a) one hundred fifty percent (150%) of their allowable amortization,
depreciation and obsolescence charges for that year plus
(b) the excess, if any, of (i) an amount equal to one hundred fifty
percent (150%) of their allowable amortization, depreciation and
obsolescence charges for the immediately preceding fiscal year over
(ii) the amount of Capital Expenditures actually made during the
immediately preceding Fiscal Year,
all as determined on a Consolidated basis.
Section 7.13 FISCAL YEAR. The Parent will not change its Fiscal Year
except as required by law.
Section 7.14 ERISA. (i) No Company will permit, with respect to any
plan whose current value of benefits which are guaranteed by the PBGC under
Title IV of ERISA (determined on the basis of assumptions prescribed by the
PBGC) exceeds the then current value of the Plan's assets allocable to such
benefit(s):
(A) any Reportable Event which has a Material Adverse
Effect;
(B) the filing with the PBGC of a notice of intent to
terminate a Plan or the giving of a notice of such
termination to participants in anticipation of such
filing which has a Material Adverse Effect; or
(C) the adoption of an amendment to a Plan if, after
giving effect to such amendment, the Plan is a plan
described in Section 4021(b)(I) of ERISA which has a
Material Adverse Effect.
(ii) No Company shall (I) withdraw from one or more multiple employer plans
during a plan year for which any Company are substantial employers with respect
to such Plan if any Company would incur liability to the PBGC constituting a
Material Adverse Effect with
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respect to such Plan or Plans under Section 4063 of ERISA, or (II) withdraw from
one or more multi-employer plans if, pursuant to Section 4202 of ERISA, a
withdrawal liability constituting a Material Adverse Effect against any Company
would result, or (III) engage in a transaction or transactions which could
subject any Company, to a tax or penalty imposed by either Section 4975 of the
Code or Section 502(i) of ERISA constituting a Material Adverse Effect, or (IV)
allow one or more Plans, at any time to have an accumulated funding deficiency,
or fail to make any contributions when due to a Plan that is required to satisfy
the minimum funding standards under Section 412 of the Code constituting a
Material Adverse Effect. As used in this Section 7.14, (y) "accumulated funding
deficiency", multi-employer plan, "multiple employer plan", "plan year", and
"single employer plan" shall have the respective meanings assigned to such terms
in Section 4.13 and (z) "withdrawal liability" means the amount thereof as
determined in accordance with Section 4201 of ERISA.
Section 7.15 REGULATION U. The Borrowing Group shall not, directly or
indirectly, (a) apply any part of the proceeds of the Revolving Loan to the
purchasing or carrying of any "margin stock" within the meaning of Regulations
G, T, U or X of the Federal Reserve Board, or any regulations, interpretations
or rulings thereunder except for the Cryenco Acquisition, (b) extend credit to
others for the purpose of purchasing or carrying any such margin stock, or (c)
retire indebtedness which was incurred to purchase or carry any such margin
stock.
Section 7.16 PARTNERSHIPS AND JOINT VENTURES. No Company shall act or
participate as a general or limited partner in any partnership or a joint
venturer in any joint venture unless permitted pursuant to Sections 7.05 or
7.07.
Section 7.17 TRANSACTIONS WITH AFFILIATES. The Borrowing Group shall
not, directly or indirectly, pay (excluding in all cases salary, bonuses and
other similar compensation) any funds to or for the account of, make any
Investment in, purchase, acquire or lease any property from, or sell, transfer
or lease any property to, or otherwise deal with, in the ordinary course of
business or otherwise, any Affiliate except on terms that are no less favorable
to the Borrowing Group than those terms which might be obtained at the time from
unrelated third parties.
Section 7.18 TAX EXEMPTION OF CHD. The Parent will not at any time
(a) suffer or permit any company to take (or to fail or
omit to take) any action that is inconsistent with
CHD's exemption from income taxation pursuant to
Title 30 Delaware Code section 1902(b)(8), or
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(b) suffer or permit CHD to be or become subject to
income taxation by the State of Delaware
unless the CHD Guaranty Documents shall have theretofore been duly
executed and delivered to the Banks and the Agent. For purposes of
clause (b) of this Section 7.18, if the State of Delaware shall assert
that CHD is subject to income taxation by that State, then CHD shall be
deemed to be exempt from income taxation by the State of Delaware so
long as the assertion is contested in good faith and by timely and
appropriate proceedings which are effective to stay enforcement of the
assertion and the imposition of any mortgage, security interest or
other lien upon the property of CHD or any part thereof.
Section 7.19 GOODWILL/INTANGIBLES. The Borrowing Group agrees that at
no time will the Companies have goodwill and other Assets that are intangible
(as determined in accordance with GAAP on a Consolidated basis) in excess of
Eighteen Million Dollars ($18,000,000).
ARTICLE VIII
------------
WAIVERS
-------
Any of the acts which the Borrowing Group are required or prohibited
from doing by any of the provisions of this Credit Agreement may,
notwithstanding such provisions, be omitted or done, as the case may be, only if
consented to in writing by the Majority of the Banks or all the Banks, as
determined in accordance with the provisions of Sections 12.08 and 12.09 of this
Agreement.
ARTICLE IX
----------
DEFAULTS
--------
Each of the following events shall be termed "Events of Default":
Section 9.01 PRINCIPAL DEFAULT. Default shall be made in the payment of
any principal of any of the Revolving Notes or any of the Revolving Loan when
and as the same shall become due and payable, whether at maturity or otherwise;
or
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Section 9.02 INTEREST DEFAULT. Default shall be made in the payment of
any interest on or with respect to any of the Revolving Notes or any of the
Revolving Loan when the same shall become due and payable and such default shall
continue for three (3) consecutive Business Days; or
Section 9.03 OTHER PAYMENT DEFAULTS. Default shall be made in the
payment of any other amount when and as the same shall become due and payable
under the of this Credit Agreement or any of the Loan Documents and such default
shall continue for five (5) consecutive Business Days; or
Section 9.04 CERTAIN ARTICLE VI AND VII DEFAULTS. Default shall be made
in the due observance or performance of any covenant, agreement, or provision
contained in Section 6.05 (with respect to the first two sentences thereof),
6.10, 6.11, 6.12, 6.13, 6.14 or 6.15 or any provision of Article VII; or
Section 9.05 CERTAIN ARTICLE VI DEFAULTS. Default shall be made in the
due observance or performance of any covenant, agreement or provision contained
in Section 6.06(i), (ii) or (v).
Section 9.06 DEFAULTS UNDER ARTICLE VI. Default shall be made in the
due observance or performance of any covenant, agreement, or provision contained
in Section 6.02, 6.03, 6.04, 6.06 (with respect to subparagraphs (iii), (iv),
(vi), (vii) and (viii) only), 6.07, 6.08, 6.09 or 6.16, and such default shall
continue for ten (10) consecutive Business Days unless the Borrowing Group is
diligently pursuing a cure thereof and has advised the Banks of such cure and
only to the extent that such default has been cured within thirty (30)
consecutive days thereafter; or
Section 9.07 OTHER PROVISION DEFAULT. Default shall be made in the due
observance or performance of any other covenant, agreement, or provision of this
Credit Agreement, the Revolving Notes or any other Loan Document to be performed
or observed by the Borrowing Group and such default shall not be corrected or
cured within twenty (20) consecutive calendar days; or
Section 9.08 REPRESENTATION AND WARRANTY. Any material representation
or warranty made by the Borrowing Group under this Credit Agreement or in any
certificate, report, instrument, financial statement or other document furnished
pursuant to this Credit Agreement shall prove to have been false or incorrect in
any material respect as of the date on which made and such representation or
warranty shall continue to be material; or
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Section 9.09 FINANCIAL DIFFICULTIES. Any of the following events
evidencing the financial difficulties of any Company shall occur:
(i) any admission in writing of inability to pay debts as
they become due or the failure to pay debts generally
as such debts become due; or
(ii) the entry of an order for relief in the name of the
Company under Title 11 of the United States Code or
similar provisions of foreign law; or
(iii) a Company shall make an assignment for the benefit of
creditors; or
(iv) a Company shall consent to the appointment of a
trustee or receiver for all or a major part of its
property; or
(v) the commencement of a case by any Company under Title
11 of the United States Code or similar provisions of
foreign law; or
(vi) the commencement of a case under Title 11 of the
United States Code or similar provisions of foreign
law against any Company, which case shall not be
dismissed within 60 days from the date of
commencement; or
(vii) the entry of a court order appointing a receiver or a
trustee for all or a major part of any Company's
property without consent, which order shall not be
vacated, denied, set aside, or stayed within 60
calendar days from the date of entry; or
Section 9.10 ERISA TERMINATION. Any employee pension benefit plan of
any Company whose current value of benefits which are guaranteed by PBGC under
Title IV of ERISA (determined on the basis of assumptions prescribed by the
PBGC) exceeds the then current value of such plan's assets by more than
$500,000: (i) shall be terminated under Section 4041 of ERISA (unless the plan
is restored under Section 4047 of ERISA within ten (10) days of its
termination), (ii) shall be terminated under Section 4042 of ERISA, or (iii)
shall have a trustee appointed under Section 4042 of ERISA to administer the
Plan; or
Section 9.11 ACCUMULATED FUNDING DEFICIENCY. Any employee pension
benefit plan of any Company in the Borrowing Group which is a single employer
plan shall have an accumulated funding deficiency of more than $500,000, except
as set forth on SCHEDULE 4.13 attached hereto (as defined in Section 302 of
ERISA and Section 412 of the Code), as of the
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last day of any plan year (determined after the period during which employer
contributions may be deemed to have been made on such last day under Section
302(c)(10) of ERISA and Section 412(c)(10) of the Code); or
Section 9.12 OWNERSHIP. (i) If any "person" or "group" shall become the
"beneficial owner" (as those terms are respectively used in the Securities and
Exchange Act of 1934, as amended, and the rules and regulations thereunder) of
more than fifty percent (50%) of the outstanding voting stock of the Parent or
shall otherwise require the power (whether by contract, by proxy or otherwise)
to elect a majority of the Parent's board of directors; provided, that this
Section 9.12 shall not apply to any transaction receiving the prior approval by
a majority of the then members of the Parent's board of directors; (ii) the
Parent shall cease to own the Equity Interests in the Subsidiaries indicated as
owned by it on SCHEDULE 4.01 or an agreement for the sale of any part of such
Equity Interests shall have been entered into by the Parent; or
Section 9.13 CROSS-DEFAULT. Default, after the expiration of all
applicable grace periods, if any, shall be made by the Borrowing Group in the
payment when due of Liabilities, singly or in the aggregate in the amount of
$1,000,000 or more (whether principal, interest or premium) now or hereafter
owing by it (other than to the Banks under this Credit Agreement and other than
accounts payable to trade creditors for amounts incurred in the ordinary course
of business and not evidenced by promissory notes, bonds or similar instruments)
or default shall be made by the Borrowing Group in the performance of any
covenant or other obligation contained in any agreement, indenture, lease or
other instrument or document relating to, evidencing, or securing such
Liabilities if the effect of the default is to permit the holder of such
Liabilities (with or without the giving of notice or the lapse of time or both)
to accelerate the maturity thereof; or
Section 9.14 JUDGMENTS. Entry of a final judgment (a final judgment
being one from which all available appeals have been exhausted or the time for
taking such appeal has lapsed) against any Company in the amount of $250,000 or
more which is not fully covered by insurance (subject to normal deductibles)
without reservation of rights and the same is not discharged or satisfied within
thirty (30) consecutive calendar days from the date of entry; or
Section 9.15 MATERIAL ADVERSE CHANGE. A Material Adverse Effect in the
Consolidated business, operations, management, or financial condition of the
Companies, as reasonably determined by the Banks in good faith, shall have
occurred; or
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Section 9.16 RESTRAINT ON BUSINESS. Any court or administrative or
regulatory agency shall have issued an injunction or order that materially
restricts or enjoins any Company from conducting any material part of its
business as proposed to be conducted on the Closing Date and such injunction or
order has a Material Adverse Effect.
ARTICLE X
---------
REMEDIES
--------
Section 10.01 ACCELERATION. Upon (i) the occurrence of any Event of
Default described in Article X, excluding Section 9.10, the Majority of the
Banks may, at any time (unless all Events of Default shall theretofore have been
remedied or waived in accordance with the terms of this Credit Agreement),
terminate the Commitments and the right of the Borrowing Group to obtain
Advances in respect of the Revolving Loan and/or to obtain LCs, and/or declare
the unpaid principal amount of any or all of the Revolving Loan and/or Revolving
Notes, all interest accrued thereon and all other amounts owing by the Borrowing
Group to the Banks to be immediately due and payable and (ii) upon the
occurrence of any Event of Default under Section 9.10, without further action by
the Banks, the right of the Borrowing Group to obtain Advances in respect of the
Revolving Loan and/or LCs, and the Commitments shall be immediately terminated
and the Outstanding Amount, including the unpaid principal of the Revolving Loan
and/or Revolving Notes and interest accrued thereon and all other amounts owing
by the Borrowing Group to the Banks shall be immediately due and payable and, in
either case, such principal, interest and other amounts shall thereupon be
immediately due and payable, without presentment, demand, protest, notice of
protest, or other notice of any kind, all of which are hereby expressly waived
by the Borrowing Group.
Section 10.02 RECOVERY OF AMOUNTS. In case any one or more Events of
Default shall happen and be continuing, the Banks shall be entitled to recover
judgment against the Borrowing Group for the amount due. In case any one or more
Events of Default shall happen and be continuing the Majority of the Banks may
proceed to protect and enforce their rights by suit in equity, action at law,
and/or by any other appropriate proceeding, including, without limitation, for
the specific performance of any covenant or agreement or in aid of the exercise
of any power granted to the Banks, or may proceed to enforce payment of the
Revolving Notes or to enforce any other legal or equitable right.
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Section 10.03 LCs. If the maturity of the Revolving Loan shall be
accelerated pursuant to Section 11.01, the Borrowing Group shall immediately
deposit with the Agent, as security for the Borrowing Group's obligation to
reimburse the Agent and the Banks for any then outstanding LC, cash or
acceptable marketable securities having a fair cash value equal to the sum of
the aggregate undrawn balance of any then outstanding LCs.
Section 10.04 REMEDIES CUMULATIVE. Upon acceleration of the Obligations
pursuant to Section 11.01, the Banks may pursue their rights or remedies under
the Revolving Notes, this Credit Agreement or the other Loan Documents,
independently or concurrently. All rights, remedies, or powers herein conferred
upon the Banks shall, to the extent not prohibited by law, be deemed cumulative
and not exclusive of any other rights, remedies, or powers available to the
Banks. Without limiting the foregoing, the rights and remedies of the Banks
under this Credit Agreement, the Revolving Notes and the other Loan Documents
are cumulative, may be exercised simultaneously or in such order and at such
times as the Banks may elect and are in addition to their rights and remedies at
law or equity. No delay or omission of the Banks to exercise any right, remedy,
or power shall impair the same or be construed to be a waiver of any Event of
Default or an acquiescence therein. No waiver of any Event of Default shall
extend to or affect any subsequent Event of Default or shall impair any rights,
remedies, or powers available to the Banks. No single or partial exercise of any
right, remedy, or power shall preclude other or further exercise thereof by the
Banks.
Section 10.05 COST OF COLLECTION. The Borrowing Group agree that upon
and during the continuance of an Event of Default, they will jointly and
severally pay to the Banks such additional amount as shall be sufficient to
cover the cost and expenses of collection, including attorneys' fees, and any
expenses or liabilities incurred by the Banks in the collection thereof.
Section 10.06 NO ADVANCES, ETC. The Banks shall not be required to make
any Advances or issue any LC under this Credit Agreement if a Possible Default
or an Event of Default has occurred and is continuing.
ARTICLE XI
----------
AGENT
-----
Section 11.01 APPOINTMENT OF AGENT. Each Bank irrevocably appoints the
Agent to be its agent for the purpose of receiving and transmitting payments and
granting waivers and consents pursuant to this Agreement and for the other
purposes specified in this Agreement;
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PROVIDED, that this agency shall not extend to the giving of any notice pursuant
to Article X or XI, each Bank reserving to itself the right to give such
notices.
Section 11.02 COMPENSATION. The Agent shall receive compensation for
its services as referred to in Section 2.30.
Section 11.03 INDEPENDENT INVESTIGATION. Each Bank represents to the
Agent that such Bank is entering into this Agreement on the basis of its own
inquiry into the relevant facts and its own credit analysis. Each Bank
acknowledges that the Agent is acting as such solely as a convenience to the
Borrowing Group and to the Banks and not as a manager of the subject commitments
or subject indebtedness, that the Agent has no duties and no liabilities beyond
those expressly assumed by the Agent in this Agreement and the related writings,
and that the Agent shall lose no rights as a Bank by acting as the Agent.
Without limiting the generality of the foregoing, each Bank agrees NCB and its
affiliates may accept deposits from, make loans to, enter into trust indentures
with and generally transact business with the companies without notice to the
Banks and without prejudice to NCB's rights as a Bank under this Agreement and
the related writings and without prejudice to NCB's rights in respect of those
other business transactions. Each Bank agrees that it will not rely on any of
the other Banks or on the Agent for any future inquiry or analysis in respect of
this Agreement or any related writing.
Section 11.04 AGENT'S EXCULPATION. The Agent shall not be required to
make any inquiry concerning the Borrowing Group or any matter relating to this
Agreement or any related writing. The Agent shall not be liable for any
representation, warranty, agreement or obligation of any kind of the Borrowing
Group or anyone else, nor shall the Agent be deemed to have made any
representation or warranty of any kind to any Bank by reason of any notice or
any other communication pursuant to this Agreement or any related writing. The
Agent may consult with its counsel from time to time and shall not be liable for
any action taken or suffered in good faith by it in accordance with the advice
of its counsel. The Agent shall be entitled to rely on any communication to it
which it believes to be genuine and shall be under no duty to inquire into the
validity, effectiveness, genuineness or value of this Agreement or of any
related writing or of any such communication. Neither the Agent nor any of its
directors, officers, employees, attorneys and other agents shall be liable for
any action or omission on their respective parts except for gross negligence or
willful misconduct.
Section 11.05 DISBURSEMENTS. Whenever the Agent shall receive any funds
in respect of the subject indebtedness or otherwise in respect of this Agreement
or any related writing, whether from the Borrowing Group for the account of the
Banks or from the Banks for the
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account of the Borrowing Group, the Agent shall disburse the funds on the day
the funds shall be deemed to have been received. The Agent shall be entitled
(but not obligated) to make a timely disbursement of loan proceeds to the
Borrowing Group before actually receiving funds from the Banks (except if and to
the extent the Agent shall have received written instructions to the contrary
from any Bank or Banks) and to make a timely disbursement of payments to the
Banks before actually receiving funds from the Borrowing Group; PROVIDED, that
if any such disbursement is made and the funds in question are in fact not
received by the Agent, the disbursement shall be rescinded and the funds
returned to the Agent with interest computed thereon at the federal funds rate
incurred by the Agent.
Section 11.06 THE AGENT'S INDEMNITY. The Banks shall indemnify the
Agent (to the extent the Agent is not reimbursed by the Borrowing Group) from
and against any loss or liability (other than any caused by the Agent's gross
negligence or willful misconduct) incurred by the Agent as such in respect of
this Agreement or any related writing and from and against any out-of-pocket
expenses incurred in defending itself or otherwise related to this Agreement or
any related writing including, without limitation, reasonable fees and expenses
paid by the Agent to counsel of its own selection in the defense of any claim
against it or in the prosecution of its rights and remedies as the Agent;
PROVIDED, that each Bank shall be liable for only a ratable part of the whole
loss or liability according to the ratio that its subject commitment bears to
the aggregate of all of the subject commitments.
Section 11.07 ACTIONS AFTER A DEFAULT UNDER THIS AGREEMENT. In the
event that the Agent, pursuant to Section 6.01(v) shall have been notified of
any default under this Agreement, the Agent:
(i) shall promptly notify the Banks;
(ii) shall take such action and assert such rights
under this Agreement as it is expressly required to do
pursuant to the terms of this Agreement;
(iii) may take such other actions and assert such
other rights as it deems advisable, in its sole discretion,
for the protection of the interests of the Banks; and
(iv) shall inform all the Banks of the taking of
action or assertion of rights pursuant to this subsection.
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Each Bank agrees with the Agent and the other Banks that, with respect to the
decisions and determinations to be made by the majority of the Banks in
enforcing this Agreement and in guiding the Agent in those matters, such
decisions and determinations shall be binding upon all the Banks, including,
without limitation, authorizing the Agent at the pro rata expense of all the
Banks (to the extent not reimbursed by the Borrowing Group) to retain attorneys
to seek judgment on the subject loans. Each Bank similarly agrees with the other
Banks that it will not, without the consent of the majority of the Banks, seek
to separately institute any legal action on this Agreement.
Section 11.08 ACTIONS REQUIRING CONSENT OF A MAJORITY OF THE BANKS. The
approval of a Majority of the Banks is required to amend or waive any of the
provisions of Articles I, II (except as described in Section 11.09), III, IV, V,
VI, VII, VIII, IX, X, XI or XII (except Section 11.09) of this Agreement.
Section 11.09 ACTIONS REQUIRING CONSENT OF ALL BANKS. Notwithstanding
any other provisions of this Agreement, all of the Banks must approve any waiver
or amendment to this Agreement which would (i) extend the expiration date of the
Credit Facility; (ii) extend the date on which any Revolving Loan is due; (iii)
reduce any interest rate, commission, commitment fee or other amount payable by
Borrowing Group hereunder; (iv) increase any Bank's subject commitment; (v)
change the percentage of the Banks whose approval is required to take any action
hereunder; (vi) change any of the provisions of this Section 11.09.
ARTICLE XII
-----------
MISCELLANEOUS
-------------
Section 12.01 PAYMENT OF EXPENSES. If Taxes shall be payable, or ruled
to be payable, to any state, province or Federal authority, with respect to the
execution and delivery of this Credit Agreement, the Revolving Notes, or any
other Loan Document by reason of any existing or hereafter enacted Federal or
state statutes, the Borrowing Group will pay all such taxes in accordance with
such statutes, including interest and penalties thereon, excluding Taxes solely
on income of the Banks if any, and will indemnify and hold the Banks harmless
against any liability in connection therewith. The Borrowing Group will also
reimburse the Banks the fees and disbursements incurred by Messrs. Kahn,
Kleinman, Yanowitz & Arnson Co., L.P.A. for their services to the Banks in
preparing, reviewing, closing, or enforcing this Credit Agreement and the other
documents executed in connection herewith, and will reimburse the Banks for any
out-of-pocket expenses incurred in
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connection therewith. The Borrowing Group shall at all times protect, indemnify,
defend and save harmless the Banks from and against any and all claims, actions,
suits and other legal proceedings and liabilities, damages, costs, interest,
charges, reasonable counsel fees and other expenses and penalties but, prior to
the occurrence of and during the continuance of an Event of Default, excluding
the Banks' ordinary course of business internal and out of pocket costs and
expenses (the "Indemnified Liabilities"), which the Banks may, at any time,
sustain or incur by reason or in consequence of or arising out of the execution
and delivery of this Credit Agreement and the consummation of the transactions
contemplated hereby except for any such Indemnified Liabilities resulting from
the gross negligence or willful misconduct of the Banks. The Borrowing Group
acknowledges that it is the intention of the parties hereto that this Agreement
shall be construed and applied to protect and indemnify the Banks against any
and all risks involved in the execution and delivery of this Credit Agreement
and the consummation of the transactions contemplated hereby, all of which risks
are hereby assumed by the Borrowing Group, including, without limitation, any
and all risks of the acts or omissions, whether rightful or wrongful, or any
present or future, de jure or de facto government or governmental authority. All
amounts payable or reimbursable by the Borrowing Group under this Section 12.01
shall be due and payable on demand. The obligations imposed upon the Borrowing
Group by this Section 12.01 shall survive the payment of the Revolving Loan and
the Revolving Notes. No action shall be commenced by any of the Borrowing Group
for any claim against the Agent or the Banks under the terms of this Credit
Agreement unless a notice specifically setting forth the claim of the Borrowing
Group or any one of them shall have been given to the Agent within thirty (30)
days after the occurrence of the event which the Borrowing Group or any one of
them allege gave rise to such claim, and failure to give such notice shall
constitute a waiver of any such claim. If any Bank shall be in breach of such
Bank's obligations under this Credit Agreement by reason of failure to make an
Advance, or issue an LC or Bank Guaranty as such Bank is required to do under
the terms hereof, the sole remedy on account thereof shall be to compel such
Bank to make the Advance, or issue the LC or Bank Guaranty which is determined
wrongfully to have been withheld (upon the making of which the same shall be
treated as any other Advance or issuance of any other LC or Bank Guaranty
pursuant to the terms of this Agreement). In any event, neither the Agent or any
Bank shall be liable to any of the Borrowing Group for incidental or
consequential damages, whatever the nature of a breach by Agent or the Banks in
their obligations hereunder.
Section 12.02 NOTICES. Any notice to or demand upon the Borrowing Group
shall be deemed to have been sufficiently given or served for all purposes
hereof one day after being sent by overnight express courier, three days after
being mailed, certified mail, return receipt requested or, when received during
normal business hours, by electronic facsimile (confirmed by subsequent delivery
of "hard copy"), addressed to the Borrowing Group at c/o
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<PAGE> 74
Chart Industries, 35555 Curtis Boulevard, Eastlake, Ohio 44095, Attn: Chief
Executive Officer, or to such other address as may be furnished in writing to
the Banks and the Agent for such purpose by the Borrowing Group. Any notice to
or demand upon the Banks and the Agent shall be deemed to have been sufficiently
given or served for all purposes hereof one day after being sent by overnight
express courier or hand delivered to the Account Officer of each Bank as
follows: If to NCB and the Agent, National City Bank, National City Center,
Cleveland, Ohio 44101-0756, Metro-Ohio Division, Attn: Anthony J. DiMare; if to
NBD, NBD Bank, 611 Woodward Avenue, Detroit, Michigan 48226, Midwest Banking
Division, Attn. Paul R. DeMelo, or to such other address as may be furnished in
writing to the Borrowing Group for such purpose by the Banks and the Agent. The
Borrowing Group agrees that the Banks and the Agent may rely and act upon,
without any investigation or inquiry as to the authority or power to give, or
accuracy or reasonableness of, and the Borrowing Group will be unconditionally
and irrevocably bound and obligated by, any instructions, notice, request,
report or other communications given by the Parent to the Banks.
Section 12.03 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained herein shall survive the execution and
delivery of this Credit Agreement, any investigation at any time made by the
Banks or the Agent, and the execution and delivery of the Revolving Notes and
shall continue in full force and effect so long as the Revolving Notes are
outstanding and unpaid.
Section 12.04 ENTIRE AGREEMENT; AMENDMENT. This Credit Agreement,
including all exhibits hereto, embodies the entire agreement and understanding
between the Borrowing Group, the Banks and the Agent and supersedes all other
prior agreements and understandings relating to the subject matter hereof. The
Borrowing Group, the Banks and the Agent may enter into further and additional
written agreements to amend or supplement this Credit Agreement and the terms
and provisions of such further and additional written agreements shall be deemed
a part of this Credit Agreement as though incorporated herein. Except as
provided herein, the Banks have no obligation to make loans or advances to the
Borrowing Group.
Section 12.05 PARTIES IN INTEREST; BANK'S PURPOSE. (i) All the terms
and provisions of this Credit Agreement shall inure to the benefit of and be
binding upon and be enforceable by the respective successors and assigns of the
parties hereto, whether so expressed or not and, in particular, shall inure to
the benefit of and be enforceable by any holder of the Revolving Notes. The
Borrowing Group shall not assign their rights under this Credit Agreement
without the prior written consent of the Banks. The Banks, without the prior
written consent of the Borrowing Group but with the prior consent of the Agent,
may assign,
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or sell participation in, all or part of the Revolving Loan and their rights
under the Credit Agreement and the other Loan Documents. The Banks agree that
they will give the Borrowing Group prompt written notice of any assignment of
all or part of the Revolving Loan.
(ii) Each Bank represents and warrants to the other Banks and to the
Borrowing Group that Bank is familiar with the Securities Act of 1933, as
amended, and the rules and regulations thereunder and that it is not entering
into this Agreement with any intention to violate that Act or any rule or
regulation thereunder, it being understood, however, that each Bank shall at all
times retain full control over the disposition of its assets subject only to
this Agreement and to all applicable law.
Section 12.06 WAIVER OF ASSERTION OF COUNTERCLAIMS; WAIVER OF JURY
TRIAL. Each and every right granted to the Banks hereunder or under any other
document delivered hereunder or in connection herewith, or allowed it by law or
equity, shall be cumulative and may be exercised from time to time. No failure
on the part of the Banks or any holder of the Revolving Notes to exercise, and
no delay in exercising, any right shall operate as a waiver thereof nor shall
any single or partial exercise of any right preclude any other or future
exercise thereof or the exercise of any other right. The due payment and
performance of the Borrowing Group's indebtedness, liabilities and obligations
under the Revolving Notes and this Credit Agreement shall be without regard to
any counterclaim or right of offset which the Borrowing Group may have against
the Banks and the Agent and without regard to any other obligation of any nature
whatsoever which the Banks and the Agent may have to the Borrowing Group, and no
such counterclaim or offset shall be asserted by the Borrowing Group in any
action, suit or proceeding instituted by the Banks for payment or performance of
the Borrowing Group's indebtedness, liabilities or obligations under the
Revolving Notes, this Credit Agreement, the Collateral Security Documents, or
any other Loan Documents.
THE BORROWING GROUP AND THE BANKS AND THE AGENT HEREBY WAIVE THEIR
RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING IN CONNECTION WITH THIS
CREDIT AGREEMENT, THE REVOLVING NOTES OR ANY OTHER LOAN DOCUMENT OR THE
TRANSACTIONS RELATED THERETO.
Section 12.07 SET-OFF PROVISION. As security for the due payment and
performance of all the Obligations, the Borrowing Group hereby grant to the
Banks a lien on and security interest in any and all deposits or other sums at
any time credited by or due from the Banks to the Borrowing Group, whether in
regular or special depository accounts or otherwise, and any and all monies,
securities and other property of the Borrowing Group, and the proceeds thereof,
now or hereinafter held or received by or in transit to the Banks from or for
the
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Borrowing Group, whether for safekeeping, custody, pledge, transmission,
collection or otherwise, and any such deposits, sums, monies, securities and
other property, may at any time after the occurrence and during the continuance
of any Event of Default be set-off, appropriated and applied by the Banks
against any of the Obligations, whether or not any of such Obligations is then
due or is secured by any collateral, or, if it is so secured, whether or not the
collateral held by the Banks is considered to be adequate.
Section 12.08 SEVERABILITY OF PROVISIONS. Any provision of this Credit
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 12.09 HEADINGS. Article and Section headings used in this
Credit Agreement are for convenience of reference only and are not a part of
this Agreement for any other purpose.
Section 12.10 CONSENT TO JURISDICTION. Each Company in the Borrowing
Group agrees that any action or proceeding to enforce or arising out of this
Credit Agreement or any of the other Loan Documents may be commenced in the
Common Pleas Court of Cuyahoga County, Ohio or in the District Court of the
United States for the Northern District of Ohio sitting in Cleveland, and the
Borrowing Group waive personal service of process and agree that a summons and
complaint commencing an action or proceeding in any such court shall be properly
served and shall confer personal jurisdiction if served to the persons and
addresses listed in Section 12.02 in accordance with the provisions of this
Section 12.10, or as otherwise provided by the laws of the State of Ohio or the
United States.
Section 12.11 GOVERNING LAW. This Credit Agreement, the Revolving Notes
and each other Loan Document are and will be contracts made under the laws of
the State of Ohio (without regard to the laws regarding conflicts of laws) and
together with the rights and obligations of the parties hereunder shall be
construed and enforced in accordance with and governed by the laws of such
State.
Section 12.12 COUNTERPARTS. This Credit Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed to be
an original and all of which taken together shall constitute but one and the
same agreement.
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Section 12.13 NATURE OF THE BORROWING GROUP'S OBLIGATIONS AND
MODIFICATION THEREOF. THE OBLIGATIONS OF THE BORROWING GROUP UNDER THIS
AGREEMENT, THE REVOLVING NOTES AND THE OTHER LOAN DOCUMENTS ARE JOINT AND
SEVERAL. The obligations of the Borrowing Group under this Agreement are
absolute and unconditional and shall be irrevocable. The Borrowing Group agree
that their obligations hereunder shall not be impaired, modified, changed,
released or limited in any manner whatsoever by any impairment, modification,
change, release or limitation of the liability of any member of the Borrowing
Group by any bankruptcy case or by any stay or other legal impediment in or
arising from the operation of any present or future provision of the Bankruptcy
Code or other similar state or federal statute, or from the decision of any
court or any perfection or failure to perfect any Lien upon any property of any
member of the Borrowing Group. The Borrowing Group agrees that the Banks may, in
their discretion, (i) release, discharge, compromise or settle with, or grant
indulgences to, refuse to proceed or take action against, any Company in the
Borrowing Group with respect to its respective obligations under this Agreement,
(ii) release, surrender, modify, impair, exchange, substitute or extend the
period or duration of time for the performance, discharge or payment of, refuse
to enforce, compromise or settle its respective lien, security interest, pledge
or assignment against, any and all deposits and other property or assets on
which the Bank may have a lien, security interest, pledge or assignment or which
secures any of the obligations of the Borrowing Group under this Agreement, and
(iii) amend, modify, alter or restate, in accordance with their respective
terms, this Agreement or any of the Loan Documents or otherwise, accept deposits
or other property from, or enter into transactions of any kind or nature with,
the Borrowing Group. Each of the Borrowing Group confirms that it will be
directly or indirectly benefitted by the Revolving Loan and any and all other
Advances under this Agreement or any of the Loan Documents.
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IN WITNESS WHEREOF, the parties have caused this Credit Agreement to be
executed as of the date first above written by their respective representatives
thereunto duly authorized.
CHART INDUSTRIES, INC. CHART MANAGEMENT COMPANY,
INC.
By: /s/ Don A. Baines By: /s/ Don A. Baines
----------------------------------- ---------------------------------
Don A. Baines, Treasurer and CFO Don A. Baines, Secretary and
Treasurer
ALTEC INTERNATIONAL LIMITED CHART INDUSTRIES FOREIGN SALES
PARTNERSHIP CORPORATION
By: CHART MANAGEMENT COMPANY, By: /s/ Don A. Baines
INC., its sole general partner ---------------------------------
Don A. Baines, Secretary and
Treasurer
/s/ Don A. Baines
- -------------------------------------- PROCESS SYSTEMS INTERNATIONAL, INC.
Don A. Baines, Secretary and Treasurer
By: /s/ Don A. Baines
---------------------------------
ALTEC, INC. Don A. Baines, Assistant Clerk
and Treasurer
By: /s/ Don A. Baines NATIONAL CITY BANK
-----------------------------------
Don A. Baines, Assistant Secretary By: /s/ Anthony J. DiMare
---------------------------------
Anthony J. DiMare, Vice President
GREENVILLE TUBE CORPORATION
NBD BANK
By: /s/ Don A. Baines
----------------------------------- By: /s/ Janet M. Cerra
Don A. Baines, Assistant Secretary ---------------------------------
Janet M. Cerra, Vice President
NATIONAL CITY BANK, as Agent
By: /s/ Anthony J. DiMare
New member of Borrowing Group as of ---------------------------------
July 31, 1997 Anthony J. DiMare, Vice President
CRYENCO SCIENCES, INC.
By: /s/ Don A. Baines, Secretary
--------------------------------
Don A. Baines, Secretary
and Treasurer
72
<PAGE> 1
Exhibit 10.21
REVOLVING NOTE
--------------
$27,000,000.00 Dated: July 29, 1997
FOR VALUE RECEIVED, the undersigned (the "Borrowing Group") hereby
promise to pay to the order of NATIONAL CITY BANK (the "Lender") the principal
amount of TWENTY SEVEN MILLION DOLLARS ($27,000,000 ) on or before May 31, 2000,
or, if less, the aggregate amount of all amounts borrowed pursuant to the Credit
Agreement (as hereinafter defined) and unpaid, together with interest computed
in the manner provided in the Credit Agreement, with such borrowings and
interest payable in accordance with the provisions of the Credit Agreement.
Both principal and interest are payable to Lender at the place
specified in the Credit Agreement, in immediately available funds.
This Revolving Note is one of the Revolving Notes referred to in, and
is entitled to the benefits of, the Credit Agreement dated as of July 29, 1997
(the "Credit Agreement"), between the Borrowing Group, the Lender, NBD Bank and
National City Bank as Agent for the Lender and NBD Bank. The Credit Agreement,
among other things, contains provisions for acceleration of the maturity hereof
upon the terms and conditions therein specified. Reference is made to the Credit
Agreement governing the making of loans to the Borrowing Group, rights of
prepayment, and for other provisions to which this Revolving Note is subject.
No delay or omission on the part of the Lender in exercising any right
hereunder shall operate as a waiver of such right or any other right under this
Revolving Note. A waiver on any one occasion shall not be construed as a bar to
or waiver of any such right or remedy on any future occasion. The Borrowing
Group waives protest, presentment, demand, and notice of nonpayment.
This Revolving Note shall be governed by, and construed and enforced in
accordance with, the laws of the State of Ohio.
CHART INDUSTRIES, INC.
By: /s/ Don A. Baines
____________________________________
<PAGE> 2
ALTEC INTERNATIONAL LIMITED PARTNERSHIP
By: CHART MANAGEMENT COMPANY, INC.,
its sole general partner
/s/ Don A. Baines
By:_______________________________
ALTEC, INC
/s/ Don A. Baines
By:__________________________________
GREENVILLE TUBE CORPORATION
/s/ Don A. Baines
By:__________________________________
CHART MANAGEMENT COMPANY, INC.
/s/ Don A. Baines
By:_________________________________
CHART INDUSTRIES FOREIGN SALES CORPORATION
/s/ Don A. Baines
By:________________________________
PROCESS SYSTEMS INTERNATIONAL, INC.
/s/ Don A. Baines
By:________________________________
2
<PAGE> 3
ALLONGE
-------
This Allonge shall be so firmly affixed to the Revolving Note (as
hereinafter defined) as to become a part thereof. The "Revolving Note" is that
certain Revolving Note dated July 29, 1997 originally issued by the Borrowing
Group (as defined in the Revolving Note) to National City Bank.
the undersigned (the "Additional Borrower") hereby becomes an
additional maker of the Revolving Note, as if the Additional Borrower had
executed and delivered the Revolving Note simultaneously with the original
execution and issuance of the revolving Note by the Borrowing Group.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Allonge as of the 31st day of July, 1997.
CRYENCO SCIENCES, INC.
By: /s/ Don A. Baines
-------------------------
Don A. Baines, Secretary and Treasurer
<PAGE> 1
Exhibit 10.22
REVOLVING NOTE
--------------
$18,000,000.00 Dated: July 29, 1997
FOR VALUE RECEIVED, the undersigned (the "Borrowing Group") hereby
promise to pay to the order of NBD BANK (the "Lender") the principal amount of
EIGHTEEN MILLION DOLLARS ($18,000,000 ) on or before May 31, 2000, or, if less,
the aggregate amount of all amounts borrowed pursuant to the Credit Agreement
(as hereinafter defined) and unpaid, together with interest computed in the
manner provided in the Credit Agreement, with such borrowings and interest
payable in accordance with the provisions of the Credit Agreement.
Both principal and interest are payable to Lender at the place
specified in the Credit Agreement, in immediately available funds.
This Revolving Note is one of the Revolving Notes referred to in, and
is entitled to the benefits of, the Credit Agreement dated as of July 29, 1997
(the "Credit Agreement"), between the Borrowing Group, National City Bank, the
Lender, and National City Bank as Agent for National City Bank and the Lender.
The Credit Agreement, among other things, contains provisions for acceleration
of the maturity hereof upon the terms and conditions therein specified.
Reference is made to the Credit Agreement governing the making of loans to the
Borrowing Group, rights of prepayment, and for other provisions to which this
Revolving Note is subject.
No delay or omission on the part of the Lender in exercising any right
hereunder shall operate as a waiver of such right or any other right under this
Revolving Note. A waiver on any one occasion shall not be construed as a bar to
or waiver of any such right or remedy on any future occasion. The Borrowing
Group waives protest, presentment, demand, and notice of nonpayment.
This Revolving Note shall be governed by, and construed and enforced in
accordance with, the laws of the State of Ohio.
CHART INDUSTRIES, INC.
/s/ Don A. Baines
By:______________________________
<PAGE> 2
ALTEC INTERNATIONAL LIMITED PARTNERSHIP
By: CHART MANAGEMENT COMPANY, INC.,
its sole general partner
/s/ Don A. Baines
_____________________________________
ALTEC, INC
/s/ Don A. Baines
By:__________________________________
GREENVILLE TUBE CORPORATION
/s/ Don A. Baines
By:__________________________________
CHART MANAGEMENT COMPANY, INC.
/s/ Don A. Baines
By:_________________________________
CHART INDUSTRIES FOREIGN SALES CORPORATION
/s/ Don A. Baines
By:________________________________
PROCESS SYSTEMS INTERNATIONAL, INC.
/s/ Don A. Baines
By:________________________________
2
<PAGE> 3
ALLONGE
-------
This Allonge shall be so firmly affixed to the Revolving Note (as
hereinafter defined) as to become a part thereof. The "Revolving Note" is that
certain Revolving Note dated July 29, 1997 originally issued by the Borrowing
Group (as defined in the Revolving Note) to National City Bank.
The undersigned (the "Additional Borrower") hereby becomes an
additional maker of the Revolving Note, as if the Additional Borrower had
executed and delivered the Revolving Note simultaneously with the original
execution and issuance of the Revolving Note by the Borrowing Group.
IN WITNESS WHEREOF, the undersigned has executed and delivered this
Allonge as of the 31st day of July, 1997.
CRYENCO SCIENCES, INC.
By: /s/ Don A. Baines
--------------------------------------
Don A. Baines, Secretary and Treasurer
<PAGE> 1
Exhibit 10.23
PLEDGE AGREEMENT
for shares of CHD, Inc., a Delaware corporation
Borrowing Group: Chart Industries, Inc., a Delaware corporation,
ALTEC International Limited Partnership, a Delaware limited partnership,
ALTEC, Inc., a Wisconsin corporation,
Chart Management Company, Inc., an Ohio corporation,
Chart Industries Foreign Sales Corporation, a Virgin Islands corporation,
Greenville Tube Corporation, an Arkansas corporation,
and Process Systems International, a Massachusetts corporation
Debtors: ALTEC, Inc., a Wisconsin corporation
and
Chart Management Company, Inc., an Ohio corporation
This Agreement is executed and delivered at Cleveland, Ohio on July
29, 1997 by ALTEC, Inc., a Wisconsin corporation, and Chart Management Company,
Inc., an Ohio corporation (jointly, the "Debtors") to National City Bank, whose
address is 1900 East Ninth Street, Cleveland, Ohio 44114-3484, in its capacity
as agent (in that capacity, the "Agent") for the Banks (as hereinafter defined)
pursuant to the Credit Agreement (as hereinafter defined):
INTRODUCTION:
WHEREAS, A. Chart Industries, Inc., a Delaware corporation, ALTEC
International Limited Partnership, a Delaware limited partnership, ALTEC, Inc.,
a Wisconsin corporation, Chart Management Company, Inc., an Ohio corporation,
Chart Industries Foreign Sales Corporation, a Virgin Islands corporation,
Greenville Tube Corporation, an Arkansas corporation, and Process Systems
International, a Massachusetts corporation (collectively, "Borrowing Group"),
National City Bank, NBD Bank, N.A. (those two financial institutions, and each
other financial institution from time to time party to the Credit Agreement,
each a "Bank") and the Agent are parties to a Credit Agreement (the "Credit
Agreement") made as of even date herewith by and among Borrowing Group, the
Banks and the Agent;
B. The Credit Agreement sets forth, among other things:
(i) the terms and conditions of each Bank's several
agreement to make loans (each a "Subject Loan") to Borrowing Group until May 31,
2000, pursuant to the Credit Agreement (the "Conversion Date");
<PAGE> 2
(ii) the terms and conditions of the agreement of the Agent
and the Banks that, so long as the subject commitments remain in effect (but in
no event later than the thirtieth day immediately preceding the Conversion
Date), the Agent will, in the name of National City Bank as agent for the Banks,
issue letters of credit (each a "Subject LC") for the account of Borrowing
Group;
(iii) each Bank's several agreement to participate in each
Subject LC; and
(iv) Borrowing Group's obligations in respect of the credit
extended to or for the account of Borrowing Group pursuant to the Credit
Agreement;
C. Borrowing Group has advised the Banks and the Agent that
CHD, Inc. (the "Issuer"), a Delaware corporation, is exempt from Delaware
corporation income tax by operation of Title 30 Delaware Code section
1902(b)(8), and that CHD's execution and delivery of a guaranty of payment may
result in CHD's disqualification as an exempt corporation for purposes of that
section;
D. Debtors own one hundred percent (100%) of the issued and
outstanding shares of common stock of the Issuer.
E. In consideration of the Subject Loans and the Subject
LC's, Debtors have agreed to execute and deliver this Agreement to the Agent;
THEREFORE, in consideration of the premises, and for other valuable
considerations, Debtors hereby agree with the Agent as follows:
1. CROSS REFERENCE. In addition to the terms defined above, certain
terms used in this Agreement are defined in section 10.
2. GRANT OF SECURITY INTEREST. Debtors hereby grant to the Agent, for
the ratable benefit of the Agent and Banks, a security interest (the "Subject
Security Interest") in ____________ (_______) shares (collectively, the "Pledged
Shares") of common stock issued by the Issuer, together with each addition, if
any, and each substitution, if any, thereto or therefor, as security for all of
the Subject Debt.
3. REPRESENTATIONS AND WARRANTIES. Debtors hereby represent and warrant
to the Agent as follows:
2
<PAGE> 3
3.1 AUTHORIZATION, ISSUANCE AND OWNERSHIP. The Pledged Shares
are duly and validly authorized and issued, are fully paid and
non-assessable, and are owned beneficially and of record by Debtors
free from any security interest, lien, equity or other interest of any
kind other than the Subject Security Interest.
3.2 CERTIFICATION AND REGISTRATION. The Pledged Shares are
"certificated securities" and are in "registered form" as those terms
are defined, respectively, in section 1308.01 of the Ohio Revised Code.
3.3 OWNERSHIP PERCENTAGE. At the date of this Agreement the
Pledged Shares constitute one hundred percent (100%) of the Issuer's
outstanding capital stock, and there are no outstanding warrants,
options or other rights of any kind for the acquisition in any manner
of any further or other shares of Issuer's capital stock of any kind.
3.4 PRIORITY AND ENFORCEABILITY. The Subject Security Interest
constitutes the first and only lien on the Pledged Shares and is
enforceable against the world according to the provisions of this
Agreement, subject to the effect of any applicable bankruptcy,
insolvency, reorganization or other similar law or equitable principle
affecting creditors' rights generally.
3.5 DELIVERY. Concurrently herewith Debtors have delivered to
the Agent all certificates evidencing the Pledged Shares together with
appropriate stock transfer powers duly executed in blank with
signatures guaranteed, all in form and substance satisfactory to the
Agent.
3.6 INFORMATION. Debtors have made independent arrangements
with Borrowing Group to receive financial statements, audit reports and
other financial and other information regarding Borrowing Group
directly from Borrowing Group.
3.7 CREDIT DOCUMENTS. Debtors have received directly from
Borrowing Group a true and complete copy of the Credit Agreement and
each Loan Document and Debtors have assented to the respective
provisions thereof.
4. TRANSFER. The Agent may, in the event that any Default shall occur
and be continuing, transfer the Collateral at any time (or from time to time any
part thereof) into the name of the Agent or its nominee.
5. VOTING AND DISTRIBUTIONS. So long as no Default shall exist and no
notice to the contrary shall have been given by the Agent to Debtors as provided
below, Debtors
3
<PAGE> 4
shall have the right to vote the Collateral and to receive all income in
respect thereof to the extent such income is paid out of the Issuer's current
earnings and profits.
5.1 NOTICE DURING DEFAULT. On and after the effective date
specified in a notice given during the existence of a Default and given
not less than seven (7) calendar days prior to that effective date, the
Agent shall have the exclusive right:
(a) to vote the Collateral and to receive the income
and other distributions thereto or
(b) to vote the Collateral in any election of
directors or any other matter submitted to the Issuer's
shareholders, in each case in such manner as the Agent in its
discretion may deem advisable, provided that the Agent shall
in no event ever have any duty to vote the Collateral, or
(c) both.
5.2 DISTRIBUTIONS IN TRUST. If at any time Debtors shall
receive any distribution of income or other distribution (other than
distributions of income permitted to be received under the first
sentence of this section 5) in respect of the Collateral, Debtors shall
receive the same in trust and shall promptly deliver the same to the
Agent in the very form in which received but with all assignments or
endorsements thereof helpful to the Agent's collection thereof.
5.3 INAPPLICABILITY TO PURCHASERS. The provisions of this
section 5 shall not apply to any purchaser of Collateral purchased
pursuant to any sale conducted in accordance with section 7.
6. AGENT'S DUTIES LIMITED. Debtors agree that the Agent shall at no
time have any duty to preserve any rights against the Issuer or against any
prior party, to preserve any right pertaining to the Collateral, to vote the
Collateral or to protect the Collateral or any income therefrom beyond the safe
physical custody of the Collateral.
7. REMEDIES. The Agent shall have the rights and remedies of a secured
party under Ohio law including, without limitation, the rights referred to in
subsections 7.1 through 7.4 (both inclusive).
7.1 DISPOSITION. The Agent shall have the right at all times
during the existence of any Default to sell, assign, transfer and
deliver the Collateral at any time from time to time any part thereof,
in each case upon such terms and
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conditions as the Agent in its discretion may deem advisable. The Agent
shall give Debtors not less than seven (7) calendar days' prior written
notice of either the date after which any intended private sale may be
made or the time and place of any intended public sale, except that the
Agent need give no such notice in the case of any sale of Collateral
which the Agent in good faith determines to be declining speedily in
value or to be of a type customarily sold on a recognized market.
Debtors waive advertisement of sale and, except only to the extent
required by the next preceding sentence, waives notice of any kind in
respect of any such sale.
7.2 APPLICATION OF PROCEEDS. The Agent shall have the right to
apply the net proceeds (after deduction of the Agent's reasonable costs
and expenses of sale and delivery) of the Collateral to the Subject
Debt as follows, in each case with such allocation as to item and
maturity as the Agent in its sole discretion may from time to time deem
advisable:
first, to any Subject Debt then owing to the Agent;
second, ratably (as defined in the Credit Agreement) to the
principal of and interest on each Bank's Subject Loans;
third, to be held as security to the extent, if any, of the
aggregate undrawn balance of the Subject LC's;
fourth, to any other Subject Debt (in the proportion of the
respective amounts thereof) then owing to the Banks or any
thereof;
fifth, as required by applicable law governing the rights of
any lien junior in priority to the Subject Security Interest;
and
sixth, after satisfaction of the requirements of the above
five clauses, then and only then as instructed by Debtors, who
shall be liable for any deficiency.
7.3 PURCHASE BY AGENT. The Agent may purchase the Collateral
free from any right of redemption:
(a) at any public sale or
(b) at any private sale if the Collateral is of a
type which the Agent in good faith determines to be either of
a type customarily sold in a
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recognized market or of a type which is the subject of widely
distributed standard price quotations,
all such rights of redemption, in either case, being hereby waived
and released.
7.4 EFFECT OF SECURITIES LAWS. Debtors acknowledge that
because of applicable securities laws, the Agent may not be able to
effect a public sale and that a private sale may be possible only for a
less favorable price and only for other less favorable terms that might
be possible in the event of a public sale. Debtors agree that any
public or private sale made by the Agent shall be deemed to have been
made in a commercially reasonable manner, provided only that the Agent
shall have acted in good faith and complied with the provisions of this
Agreement.
8. NO SUBROGATION. Debtors hereby waive all rights (including, without
limitation, contribution, exoneration, indemnification, reimbursement and
subrogation), whether arising at law or equity, by contract, operation of law or
otherwise, that Debtors, and each of them, now have or may hereafter acquire
against Borrowing Group and the other Obligors, if any, or any of them to the
extent that such rights arise solely out of or in connection with this
Agreement.
9. ENFORCEMENT COSTS. Debtors, and each of them, shall reimburse the
Agent, on the Agent's demand from time to time, for any and all expenses
(including, without limitation, the fees and disbursements of legal counsel)
incurred by the Agent in protecting and enforcing its rights under this
Agreement. Debtors, and each of them, will pay to the Agent, on the Agent's
demand from time to time, interest on each such expense at a rate per annum
equal to four percent (4%) per annum plus the Prime Rate.
10. DEFINITIONS. In this Agreement, except where the context clearly
requires otherwise,
"Account Officer" means any officer of National City Bank who has
authority to approve the extension of credit by National City Bank to
or for the account of Borrowing Group and who is assigned to National
City Bank's Metro/Ohio Division, Debtor hereby assuming the burden of
ascertaining the identity of such officer or officers;
"Agent" is defined in the first paragraph of this Agreement;
"Agreement" means this Pledge Agreement and each amendment, if any,
thereto;
"Bank" is defined in paragraph A of the introduction to this Agreement;
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"Borrowing Group" is defined in paragraph A of the introduction to this
Agreement;
"Collateral" means, collectively, the Pledged Shares together with each
addition, if any, or substitution, if any, thereto or therefor in whole
or in part;
"Credit Agreement" is defined in paragraph A of the introduction to
this Agreement;
"Debt" means, collectively, all liabilities of the party or parties in
question to the Banks and the Agent or any thereof, whether owing by
one such party alone or with one or more others in a joint, several, or
joint and several capacity, whether now owing or hereafter arising,
whether owing absolutely or contingently, whether created by loan,
overdraft, guaranty of payment or other contract or by quasi-contract
or tort, statute or other operation of law or otherwise, whether
incurred directly to the Banks and the Agent or any thereof or acquired
by the Banks and the Agent or any thereof by purchase, pledge or
otherwise, and whether participated to or from the Bank, and the Agent
or any thereof in whole or in part;
"Debtor" is defined in the first paragraph of this Agreement;
"Default" means (a) the failure or omission of any Person other than
Bank to perform or observe any agreement (including, without
limitation, any agreement with respect to the payment of the Subject
Debt or any part thereof) contained in the Credit Agreement, as the
same may be amended from time to time, or any Loan Document (including,
without limitation, this Agreement) which is on that Person's part to
be performed or observed, but only if any grace period applicable to
that failure or omission shall have lapsed, or (b) the occurrence or
existence of any event, condition, or thing (other than any event,
condition or thing which would constitute a Default pursuant to the
next preceding clause (a)) which gives Bank the right to accelerate or
which automatically accelerates the maturity of any Guaranteed Debt;
"Issuer" is defined in paragraph C of the introduction to this
Agreement;
"Loan Document" means any credit agreement (including, without
limitation, the Credit Agreement as the same may be amended from time
to time), indenture, note, mortgage, security agreement, notice,
financial statement, legal opinion, certificate or other writing of any
kind pursuant to which the Secured Debt or any part thereof is issued
or which evidences or secures the Secured Debt or any
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part thereof or which is delivered to the Banks and the Agent or any
thereof pursuant to another such writing or which is otherwise
delivered by any Obligor (or any officer, auditor, counsel or agent
of any Obligor) in respect of the Subject Debt or any part thereof;
"Obligor" means any person or entity who or any of whose property shall
at the time in question be obligated in respect of the Subject Debt or
any part thereof and (in addition to Debtors) includes, without
limitation, co-makers, endorsers, guarantors of payment, subordinating
creditors, pledgors and mortgagors, if any;
"Pledged Shares" is defined in section 2;
"Primary Debt of Debtors" means, collectively, all Debt incurred by
Debtors;
"Prime Rate" means the fluctuating rate of interest which is publicly
announced from time to time by National City Bank at Cleveland, Ohio as
being its "prime rate" or "base rate" thereafter in effect, with each
change in the Prime Rate automatically, immediately and without notice
changing the fluctuating interest rate thereafter applicable hereunder,
it being agreed that the Prime Rate is not necessarily the lowest rate
of interest then available from National City Bank on fluctuating-rate
loans;
"Secured Debt" means, collectively, (a) all Debt incurred by Borrowing
Group prior to the Termination of Future Exposure and (b) all Debt
incurred by Borrowing Group (even if any Default then exists) pursuant
to a commitment provided that the commitment shall have been made prior
to the Termination of Future Exposure and (c) each renewal, extension
or refinancing, if any, of any or all of the Debt referred to in (a) or
(b) in whole or in part even if the renewal, extension or refinancing
is effected after the Termination of Future Exposure;
"Subject Debt" means, collectively, all of the Primary Debt of Debtor
and all of the Secured Debt of Borrowing Group;
"Subject LC" is defined in paragraph B of the introduction to this
Agreement;
"Subject Loan" is defined in paragraph B of the introduction to this
Agreement;
"Subject Security Interest" is defined in section 2;
"Termination of Future Exposure" means the GIVING OF WRITTEN NOTICE to
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the Agent either that (a) Debtor desires to terminate the Subject
Security Interest as to any Debt (other than Subject Debt) incurred
after the giving of any such notice, or (b) that Debtor has been
dissolved, or (c) a case in bankruptcy has been commenced by or against
Debtor as a debtor -- any such notice to be deemed to have been duly
given only when delivered to an Account Officer of the Agent;
the foregoing definitions shall be applicable to the respective
singulars and plurals, as the case may be, of the foregoing defined
terms.
11. CONTINUING EFFECT. Except as provided in section 12, Debtors'
liabilities and other obligations under this Agreement and the Subject Security
Interest shall remain in effect in accordance with the provisions of this
Agreement until (a) the Termination of Future Exposure or (b) the payment in
full of all of the Subject Debt -- whichever, (a) or (b), shall be the later to
occur -- and shall not be affected by the lapse of time, by the fact that there
may be a time or times when no Subject Debt is outstanding, or by any act,
omission or course of dealing whatever on the part of the Banks and the Agent or
any thereof. Without limiting the generality of the foregoing, Debtors'
liabilities and other obligations under this Agreement and the Subject Security
Interest shall not be diminished or impaired by:
(a) The granting by the Banks and the Agent or any thereof of
any credit to Borrowing Group the payment of which for any reason is
not secured by the Collateral or any failure or refusal of the Banks
and the Agent or any thereof to grant any other credit to Borrowing
Group even if the Banks and the Agent or any thereof thereby breaches
any duty or commitment to Borrowing Group or anyone else and even if
any Default then exists,
(b) any extension, renewal or refinancing of the Subject Debt
in whole or in part,
(c) any amendment or other modification of any kind in, to or
of any contract, instrument or other writing of any kind, or any waiver
of any Default or any consent or other indulgence granted by any
Obligor,
(d) any acceptance of security for or any Obligor (other than
Borrowing Group and Debtors) on the Subject Debt,
(e) any release of any security or Obligor, even if the Banks
and the Agent or any thereof receive no consideration for the release,
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(f) any failure by the Banks and the Agent or any thereof to
make any presentment or demand for payment, to assert or perfect any
claim or demand or to enforce any right or remedy, or any delay or
neglect by the Banks and the Agent or any thereof in respect of the
foregoing,
(g) any failure to give Debtors notice of (1) the granting of
any credit extension to Borrowing Group or the terms, conditions and
other provisions applicable thereto, (2) any dishonor by Borrowing
Group or any other Obligor, or (3) any other event, condition or thing,
(h) (1) any lack of validity or enforceability of any Subject
LC, (2) the existence of any claim, offset, defense or other rights
that Borrowing Group may have against the beneficiary of any Subject LC
or any successor in interest, (3) the existence of any fraud or
misrepresentation in the presentment of any draft or other item drawn
and paid under any Subject LC, or (4) any payment of any draft or other
item by Agent which does not strictly comply with the terms of any
Subject LC, or
(i) any illegality, invalidity or unenforceability of the
Subject Debt or of any Loan Document.
12. Interpretation. The Agent may from time to time in its discretion
grant waivers and consents in respect of the Loan Documents and this Agreement
or any thereof or assent to amendments thereof, but no such waiver, consent or
amendment shall be binding upon the Agent unless specifically granted by the
Agent in writing, which writing shall be strictly construed. Without limiting
the generality of the foregoing, no course of dealing in respect of, nor any
omission or delay in the exercise of, any right, power or privilege by the Agent
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof preclude any further or other exercise thereof or of any other, as each
such right, power or privilege may be exercised either independently or
concurrently with others and as often and in such order as the Agent may deem
expedient. Each right, power or privilege specified or referred to in the Loan
Documents and this Agreement or any thereof is in addition to and not in
limitation of any other rights, powers and privileges that the Banks and the
Agent or any thereof may otherwise have or acquire by operation of law, by other
contract or otherwise. The provisions of this Agreement and the Loan Documents
shall bind Debtors and their respective successors and assigns and benefit the
Agent and its successors and assigns, including each subsequent holder, if any,
of the Subject Debt or any thereof. All representations and warranties made in
or pursuant to this Agreement or any thereof shall survive the execution and
delivery of this Agreement and each Loan Document. The provisions of
sections 8, 9, 10, 11, 12 and 13
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shall survive the payment in full of the Subject Debt and the termination of
the Subject Security Interest. The several captions to different sections and
subsections of this Agreement are inserted for convenience only and shall be
ignored in interpreting the provisions thereof. If any provision in the Loan
Documents and this Agreement or any thereof shall for any reason be or become
illegal, void or unenforceable, that illegality, voidness or unenforceability
shall not affect any other provision. All interest for any given period shall
accrue on the first day thereof but not on the last day thereof and in each
case shall be computed on the basis of a 360-day year and the actual number of
days elapsed. In no event shall interest accrue at the higher rate than the
maximum rate, if any, permitted by law. This Agreement shall be governed by
internal Ohio law. Except for Debtors, the Agent and the Banks, there are no
intended or third-party beneficiaries of this Agreement.
13. NOTICE. Written notice, whether or not received, shall be deemed to
have been given to Debtors whenever the Agent shall mail such notice by
certified or registered mail to Debtors at the address set forth opposite
Debtors' signatures below; however, no other method of giving actual notice to
Debtors is hereby precluded. Debtors hereby irrevocably appoint Chart
Industries, Inc. as Debtors' agent for the purpose of receiving any notice given
by the Agent to Borrowing Group or any request made by the Agent upon Borrowing
Group and Debtors agree to give Borrowing Group timely and appropriate copy of
any notice or request that is received by Debtors, given to Debtors or made upon
Debtors pursuant to or otherwise in connection with this Agreement or any Loan
Document. The Agent shall be entitled to assume that any knowledge held by
Debtors or Borrowing Group is held by the other. The Agent shall be deemed to
have knowledge or to have received notice of anything only if an Account Officer
shall have received written notice thereof at the Agent's address set forth
above.
14. JURISDICTION. Debtors agree that all disputes arising out of or
incidental to or otherwise related to the Credit Agreement, as the same may be
amended from time to time, and each "Loan Document" as defined therein
(including, without limitation, this Agreement) or any transaction thereunder,
whether arising in contract, tort or otherwise, shall be resolved only by
federal and state courts located in Cuyahoga County, Ohio, and the respective
appellate courts having jurisdiction over those courts; PROVIDED, that the Agent
shall have the right to proceed against Debtors and their respective properties
in any court in enforcing any order or realizing on any security, in which
case that Debtors shall have no right to assert any counterclaim if the
proceeding is in any court located outside Cuyahoga County, Ohio.
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ALTEC, Inc.
By: /s/ Don A. Baines
---------------------------------
Name: Don A. Baines
-------------------------------
Title: Assistant Secretary
------------------------------
Chart Management, Inc.
By: /s/ Don A. Baines
----------------------------------
Name: Don A. Baines
-------------------------------
Title: Treasurer and CFO
-------------------------------
The undersigned, Chart Industries, Inc., a Delaware corporation, hereby
acknowledges receipt of an executed counterpart of the above Pledge Agreement
and irrevocably accepts its appointment as Debtors' agent pursuant to section
13. Signed at Cleveland, Ohio, this July 29, 1997.
Chart Industries, Inc., a Delaware corporation
By: /s/ Don A. Baines
----------------------------------
Name: Don A. Baines
-------------------------------
Title: Treasurer and CFO
-------------------------------
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Exhibit 23.1
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statements
(Form S-8 No. 333-32535) pertaining to the 1997 Stock Option and Incentive Plan
and 1997 Stock Bonus Plan, (Form S-8 No. 333-08667) pertaining to the 1996 Stock
Option Plan for Outside Directors, (Form S-8 No. 333-08665) pertaining to
Amendment No. 2 to Key Employees Stock Option Plan, (Form S-8 No. 33-92346)
pertaining to the 1995 Stock Option Plan for Outside Directors and the 1994
Stock Option Plan for Outside Directors, (Form S-8 No. 33-92340) pertaining to
Amendment No. 1 to Key Employees Stock Option Plan, and (Form S-8 No. 33-58446)
pertaining to Key Employees Stock Option Plan of Chart Industries, Inc., of our
report dated October 5, 1996, with respect to the consolidated financial
statements of Cryenco Sciences, Inc. included in this Current Report (Form 8-K)
to be filed with the Securities and Exchange Commission on August 14, 1997.
/s/ Ernst & Young LLP
Denver, Colorado
August 14, 1997
