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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
The General Chemical Group Inc.
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(Name of Issuer)
Common Stock, par value $.01 per share
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(Title of Class of Securities)
369332 10 1
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(CUSIP Number)
Mr. John W. Gildea
115 East Putnam Avenue, Greenwich, Connecticut 06830
(203) 661-6945
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 23, 1997
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(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box / /.
Note: Six copies of this statement, including all exhibits, should be filed with
the Commission. See Rule 13d-1(a) for other parties to whom copies are to be
sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter disclosure
provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Page 1 of 35 Pages
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CUSIP No. 369332 10 1
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1 Name of Reporting Person1
S.S. or I.R.S. Identification No. of Above Person
John W. Gildea
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2 Check the Appropriate Box If a Member of a Group
a. / /
b. /x/
- --------------------------------------------------------------------------------
3 SEC Use Only
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4 Source of Funds
AF; PF
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5 Check If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) / /
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6 Citizenship or Place of Organization
U.S.A.
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7 Sole Voting Power
Number of 600,000
Shares
Beneficially 8 Shared Voting Power
Owned By 0
Each
9 Sole Dispositive Power
Reporting
600,000
Person
With 10 Shared Dispositive Power
0
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11 Aggregate Amount Beneficially Owned by Each Reporting Person
600,000
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12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares
/ /
- --------------------------------------------------------------------------------
13 Percent of Class Represented By Amount in Row (11)
5.40%
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14 Type of Reporting Person
IN
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1 Filing jointly pursuant to Rule 13d-1(f)(1) under the
Securities Exchange Act of 1934, as amended, with Network Fund
III, Ltd.
Page 2 of 35 Pages
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CUSIP No. 369332 10 1
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1 Name of Reporting Person2
S.S. or I.R.S. Identification No. of Above Person
Network Fund III, Ltd.
- --------------------------------------------------------------------------------
2 Check the Appropriate Box If a Member of a Group
a. / /
b. /x/
- --------------------------------------------------------------------------------
3 SEC Use Only
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4 Source of Funds
WC
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5 Check If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) / /
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6 Citizenship or Place of Organization
Cayman Islands
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7 Sole Voting Power
Number of
500,000
Shares
Beneficially 8 Shared Voting Power
Owned By
0
Each
Reporting 9 Sole Dispositive Power
Person
500,000
With
10 Shared Dispositive Power
0
- --------------------------------------------------------------------------------
11 Aggregate Amount Beneficially Owned by Each Reporting Person
500,000
- --------------------------------------------------------------------------------
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain Shares
/ /
- --------------------------------------------------------------------------------
13 Percent of Class Represented By Amount in Row (11)
4.50%
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14 Type of Reporting Person
CO
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2 Filing jointly pursuant to Rule 13d-1(f)(1) under the
Securities Exchange Act of 1934, as amended, with John W.
Gildea.
Page 3 of 35 Pages
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Item 1. Security and Issuer.
This Statement on Schedule 13D (the "Schedule 13D") relates to the
Common Stock, par value $.01 per share (the "Common Stock"), of The
General Chemical Group Inc., a Delaware corporation (the "Company").
The address of the principal executive offices of the Company is
Liberty Lane, Hampton, New Hampshire 03842.
Item 2. Identity and Background.
This Schedule 13D is filed jointly on behalf of John W. Gildea, a
United States citizen ("Gildea"), and Network Fund III, Ltd., a Cayman
Islands exempt company ("Network Fund III"), pursuant to Rule
13d-1(f)(1) under the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
Gildea is the Chairman of the Board of Directors, Chief Executive
Officer, President, a director and sole stockholder of Gildea
Management Company, a Delaware corporation ("GMC"), which corporation
has the power to dispose of the 500,000 shares of Common Stock (the
"Network Shares") beneficially owned by Network Fund III, by virtue of
an Investment Advisory Agreement, dated February 26, 1996, between GMC
and Network Fund III (the "Investment Advisory Agreement"), a copy of
which is attached hereto as Exhibit 2 and incorporated herein by
reference. Gildea also owns 75,000 shares of Common Stock in his
individual capacity (the "Gildea Direct Shares"). In addition, Gildea
is the indirect beneficial owner of 25,000 shares of Common Stock (the
"Gildea Indirect Shares" and, together with the Gildea Direct Shares,
the "Gildea Shares") held by a defined benefit plan of Gildea
Investment Company, a Connecticut S corporation of which Gildea is an
officer and the sole stockholder.
Mr. William P. O'Donnell ("O'Donnell") is an officer and director of
GMC and owns 10,000 shares of Common Stock (the "O'Donnell Shares").
Gildea and Network Fund III disclaim any existence of a group (within
the meaning of Section 13(d) of the Exchange Act) with, between or
among each other, Mr. O'Donnell or any other person or entity.
Gildea's principal business is managing the investments of various
entities in issuers located principally in the United States. Network
Fund III's principal business is to invest in debt and equity
securities of public and private companies. The principal business
address and the principal office address of Gildea is 115 East Putnam
Avenue, Greenwich, Connecticut 06830. The principal address and the
principal office address of Network Fund III is P.O. Box 219
Butterfield House, Grand Cayman, Cayman Islands, B.W.I.
The respective names, business addresses, citizenship and present
principal occupations of each director and executive officer of Network
Fund III are set forth on Schedule I hereto.
None of Gildea, Network Fund III or, to the best knowledge of such
parties, any of the persons listed on Schedule I hereto, has, during
the last five years, (i) been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors) or (ii) been a
party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is
subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to,
federal or state securities laws or finding any violation with respect
to such laws.
Page 4 of 35 Pages
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Item 3. Source and Amount of Funds or Other Consideration.
Gildea acquired the Gildea Shares for $20 per share of Common Stock, or
an aggregate of $2,000,000, all of which funds were obtained from
Gildea's personal funds. Network Fund III acquired the Network Shares
for $20 per share of Common Stock, or an aggregate of $10,000,000, all
of which funds were obtained from the working capital of Network Fund
III.
O'Donnell acquired the O'Donnell Shares for $20 per share of Common
Stock, or an aggregate of $200,000, all of which funds were obtained
from O'Donnell's personal funds.
Item 4. Purpose of Transaction.
Gildea acquired the Gildea Shares, Network Fund III acquired the
Network Shares and O'Donnell acquired the O'Donnell Shares from Stonor
Group Limited ("Stonor") pursuant to the terms of a Stock Purchase
Agreement, dated as of April 22, 1997, by and among Stonor, Gildea,
Network Fund III, Gildea, O'Donnell and the other purchasers signatory
thereto (the "Stock Purchase Agreement"). Each of Gildea, Network Fund
III and O'Donnell currently intends to hold the Gildea Shares, the
Network Shares and the O'Donnell Shares, respectively, for investment.
As of the date hereof, Gildea and the Company have engaged in
preliminary discussions concerning the possible nomination of Gildea
for election to the Board of Directors of the Company. Such discussions
have been preliminary in nature and no final determination has been
made with respect to such nomination and there can be no assurance that
Gildea will be so nominated. Each of Gildea, Network Fund III and
O'Donnell intends to review on a continuing basis their investment in
the Company. As of the date of this Schedule 13D, no determination has
been made by Gildea, Network Fund III or O'Donnell to acquire
additional shares of capital stock of the Company or to dispose of any
shares of capital stock of the Company now held by them, although any
of them may decide to so acquire or dispose of shares of capital stock
of the Company. Any such determination will depend on market conditions
prevailing from time to time and on other conditions which may be
applicable depending on the nature of the transaction or transactions
involved. Except as specifically set forth in this Item 4, none of
Network Fund III, Gildea or O'Donnell has any plans or proposals which
relate to or would result in any of the actions or effects set forth in
items (a) through (j) of Item 4 of Schedule 13D, although any of such
persons may develop such plans or proposals. Gildea and Network Fund
III disclaim any existence of a group (within the meaning of Section
13(d) of the Exchange Act) with, between or among each other, Mr.
O'Donnell or any other person or entity.
Item 5. Interest in Securities of the Issuer.
(a) (i) The 500,000 Network Shares and the 100,000 Gildea
Shares beneficially owned by Gildea represent 5.40%
of the 11,101,000 shares of Common Stock of the
Company outstanding on the date hereof, based upon
information provided by the Company and calculated in
accordance with Rule 13d-3(d)(1) under the Exchange
Act.
(ii) The 10,000 O'Donnell Shares represent 0.09% of the
11,101,000 of Common Stock of the Company outstanding
on the date hereof, based upon information
Page 5 of 35 Pages
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provided by the Company and calculated in accordance
with Rule 13d-3(d)(1) under the Exchange Act.
(iii) The 500,000 Network Shares represent 4.50% of the
11,101,000 Shares of Common Stock of the Company
outstanding on the date hereof, based upon
information provided by the Company and calculated in
accordance with Rule 13d-3(d)(1) under the Exchange
Act.
(b) (i) Gildea, as the Chairman of the Board of Directors,
Chief Executive Officer, President and majority
stockholder of GMC, may be deemed to have the power
to vote or direct the voting and to dispose or direct
the disposition of the Network Shares.
(ii) Gildea has the sole power to vote or direct the
voting of and to dispose of or direct the disposition
of the Gildea Shares.
(iii) O'Donnell has the sole power to vote or direct the
voting of and to dispose of or direct the disposition
of the O'Donnell Shares.
(c) Except as set forth in this Schedule 13D none of Gildea,
Network Fund III, O'Donnell, or, to the best knowledge of such
parties, any of the persons named on Schedule I hereto, owns
any shares of the capital stock of the Company or has
purchased or sold any shares of the capital stock of the
Company during the past 60 days.
(d) Except as set forth in this Schedule 13D, no person is known
by Gildea or Network Fund III to have the right to receive or
the power to direct the receipt of dividends from, or the
proceeds from the sale of the Gildea Shares or the Network
Shares.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
Gildea, Network Fund III, O'Donnell and other purchasers of
shares of Common Stock parties to the Stock Purchase Agreement
(collectively, the "Purchasers") entered into a Registration
Rights Agreement (the "Registration Rights Agreement") with
the Company dated as of April 22, 1997, pursuant to which the
Purchasers have been granted certain registration rights with
respect to the Common Stock held by them. A copy of the
Registration Rights Agreement is attached hereto as Exhibit 3
and is incorporated herein by reference.
GMC is party to a Consultant Agreement (the "Waterstock
Agreement") dated April 16, 1997, with Waterstock Asset
Management and certain of its designees, affiliates and
managed accounts ("Waterstock"), pursuant to which GMC may,
but shall not be obligated to, provide investment consultant
services to Waterstock with respect to the purchase and
possible sale by Waterstock of 250,000 shares of Common Stock
of the Company (the "Waterstock Shares") purchased by
Waterstock for the benefit of its clients pursuant to the
Stock Purchase Agreement. The Waterstock Agreement provides,
among other things, that Waterstock shall pay GMC a
performance fee based on pre-tax net gain from any sale of the
Waterstock Shares and a preferred return on the Waterstock
Shares. The Waterstock Agreement is non-discretionary and, as
such, GMC has no control over
Page 6 of 35 Pages
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the voting or disposition of the Waterstock Shares. Gildea
disclaims beneficial ownership of the Waterstock Shares.
GMC is also party to a Consultant Agreement (the "NUFI
Agreement") dated as of October 1, 1996 and subject to an
Addendum dated April 9, 1997, with NUFI ("NUFI"), pursuant to
which GMC acts as a consultant to NUFI with respect to the
purchase by NUFI of 150,000 shares of Common Stock of the
Company (the "NUFI Shares") purchased by NUFI pursuant to the
Stock Purchase Agreement, in exchange for certain management
and overhead fees set forth in the NUFI Agreement. The NUFI
Agreement is non-discretionary and, as such, GMC has no
control over the voting or disposition of the NUFI Shares.
Gildea disclaims beneficial ownership of the NUFI Shares.
GMC has rendered consulting services to Equitable Life
Assurance Society ("Equitable") in connection with Equitable's
purchase of 650,000 shares of Common Stock of the Company (the
"Equitable Shares") pursuant to the Stock Purchase Agreement.
At present, GMC has not entered into any formal agreement with
Equitable with respect to the provision of such services and
has no control over the voting or disposition of the Equitable
Shares. Gildea disclaims beneficial ownership of the Equitable
Shares.
Except as set forth in this Schedule 13D, there are no
contracts, arrangements, understandings or relationships
(legal or otherwise) among the persons referred to in Item 2
of this Schedule 13D or between such persons and any other
person with respect to any of the securities of the Company,
including, but not limited to, any relating to the transfer or
voting of any of such securities, finder's fees, joint
ventures, loan or option arrangements, puts or calls,
guarantees of profits, division of profits or loss or the
giving withholding of proxies.
Item 7. Materials to Be Filed as Exhibits.
1. Joint Filing Agreement, dated April 30, 1997.
2. Investment Advisory Agreement dated as of February
26, 1996, by and between Gildea Management Company
and Network Fund III, Ltd.
3. Registration Rights Agreement, by and among the
parties thereto, dated as of April 22, 1997.
Page 7 of 35 Pages
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SIGNATURE
After reasonable inquiry and to the best of their respective knowledge
and belief, the undersigned certify that the information set forth in this
statement is true, complete and correct.
Dated: April 30, 1997
By: /s/ John W. Gildea
------------------------------
John W. Gildea
NETWORK FUND III, LTD.
By: GILDEA MANAGEMENT COMPANY,
Investment Advisor
By: /s/ John W. Gildea
--------------------------
Name: John W. Gildea
Title: President
Page 8 of 35 Pages
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SCHEDULE I
Reporting Person: Network Fund III, Ltd.
P.O. Box 219, Butterfield House
Grand Cayman, Cayman Islands, B.W.I.
Executive Officers, Directors and Controlling Person:
Name: John W. Gildea
Position: Director and Chairman
Principal Occupation
and Employment;
Business Address: President, director and sole stockholder of
GMC; the business address of GMC and Mr.
Gildea is: 115 Putnam Avenue, Greenwich, CT
06830.
Name: William P. O'Donnell
Position: Director and Managing Director
Principal Occupation
and Employment: Executive officer and director of GMC
Business Address: 115 Putnam Avenue
Greenwich, CT 06830
Citizenship: USA
Name: Peter Arthur Neil Bailey
Position: Director
Principal Occupation
and Employment;
Business Address: Director of Abacus Asset Management in
Jersey, Channel Islands, a member of Coopers
& Lybrand International, a limited liability
association incorporated in Switzerland;
business address: La Motte Chambers, La
Motte Street, St. Heiler, Jersey, Channel
Islands, U.K. JE1 1BJ
Citizenship: U.K.
Name: Geoffrey William Fisher
Position: Director
Principal Occupation
and Employment;
Business Address: Director of Abacus Asset Management in
Jersey, Channel Islands, a member of Coopers
& Lybrand International, a limited liability
association incorporated in Switzerland;
business address: La Motte Chambers, La
Motte Street, St. Heiler, Jersey, Channel
Islands, U.K. JE1 1BJ
Citizenship: U.K.
Page 9 of 35 Pages
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Name: Michael David de Figueiredo
Position: Director
Principal Occupation
and Employment;
Business Address: Director of Abacus (CI) Limited, a member
of Coopers & Lybrand International, a
limited liability association incorporated
in Switzerland; business address: La Motte
Chambers, La Motte Street, St. Heiler,
Jersey, Channel Islands, U.K. JE1 1BJ
Citizenship: U.K.
Page 10 of 35 Pages
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EXHIBIT INDEX
Page
Exhibit Number
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1. Joint Filing Agreement, dated April 30, 1997. 13
2. Investment Advisory Agreement dated as of
February 26, 1996, by and between Gildea Management
Company and Network Fund III, Ltd. 15
3. Registration Rights Agreement, by and among the parties
thereto, dated as of April 22, 1997. 21
Page 11 of 35 Pages
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EXHIBIT 1
Page 12 of 35 Pages
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Exhibit 1
AGREEMENT
The undersigned hereby agree that this statement on Schedule 13D with
respect to the beneficial ownership of shares of Common Stock of The General
Chemical Group Inc. is filed jointly, on behalf of each of them.
Dated: April 30, 1997
By: /s/ John W. Gildea
----------------------------------
John W. Gildea
NETWORK FUND III, LTD.
By: GILDEA MANAGEMENT COMPANY,
Investment Advisor
By: /s/ John W. Gildea
------------------------------
Name: John W. Gildea
Title: President
Page 13 of 35 Pages
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EXHIBIT 2
Page 14 of 35 Pages
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NETWORK FUND III, LTD.
INVESTMENT ADVISORY AGREEMENT
THIS INVESTMENT ADVISORY AGREEMENT (the "Agreement") is entered into as
of February 26, 1996 by and between GILDEA MANAGEMENT COMPANY, a Delaware
corporation (the "Investment Advisor"), and NETWORK FUND III, LTD., a Cayman
Islands exempted company (the "Fund").
W I T N E S S E T H:
WHEREAS, the Fund has been formed as a closed-end investment company,
the objective of which is to achieve capital appreciation in accordance with the
investment objectives and strategies as more fully described in the Confidential
Private Placement Memorandum of the Fund dated February 1996 (the "Memorandum");
and
WHEREAS, the Fund wishes to engage the Investment Advisor to provide
investment advisory services with respect to the Fund's assets; and
WHEREAS, the Investment Advisor wishes to accept the same upon the
terms and conditions herein set forth;
NOW, THEREFORE, in consideration of the mutual premises and covenants
herein contained, the parties agree as follows:
1. Investment Management Services. In accordance with the provisions of
the Memorandum and Articles of Association of the Fund, and under the ultimate
supervision of the Board of Directors of the Fund (the "Directors") from time to
time as provided therein, and in accordance with the investment objectives,
policies, guidelines and restrictions which are set forth in the Memorandum or
which are otherwise communicated to the Investment Advisor in writing by the
Fund, the Investment Advisor shall use its reasonable efforts to invest the
assets of the Fund according to the strategy set forth in the Memorandum.
Capitalized terms not otherwise defined herein shall be used herein as defined
in the Memorandum.
2. Authority of the Investment Advisor. The Investment Advisor shall
have full discretion and authority, without obtaining the Fund's prior approval,
to manage the investment and reinvestment of the assets of the Fund in such
manner as the Investment Advisor considers appropriate consistent with the
Memorandum. In furtherance of the foregoing, the Fund hereby designates and
appoints the Investment Advisor as its agent and attorney-in-fact, with full
power and authority and without the need for further approval of the Fund
(except as may be required by law), to carry out the following with respect to
the assets of the Fund:
(a) to effect purchases and sales (including short sales) of
(i) securities of any type whatsoever, denominated in any currency, whether or
not issued by government entities, partnerships, trusts or corporations, (ii)
any put or call options thereon (including the writing of options, whether
covered or uncovered), and (iii) other securities and instruments consistent
with the Fund's investment policies and program;
(b) to make all decisions relating to the manner, method and
timing of investment transactions, and to select brokers and dealers for the
execution, clearance and settlement of any transactions;
Page 15 of 35 Pages
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(c) to borrow from banks, brokers or other financial
institutions to the extent permitted by the Memorandum and to pledge assets of
the Fund in connection therewith;
(d) to direct custodians to deliver funds or securities for
the purpose of effecting transactions, and to instruct custodians to exercise or
abstain from exercising any privilege or right attaching to such assets; and
(e) to make and execute, in the name and on behalf of the
Fund, all such documents (including, without limitation, customer agreements and
other documents in connection with the establishment and maintenance of
brokerage accounts) and to take all such other actions as the Investment Advisor
considers necessary or advisable to carry out its investment management duties
hereunder.
3. Brokerage. In the course of selecting brokers, dealers, banks and
intermediaries to effect transactions for the Fund, the Investment Advisor may
agree to such commissions, fees and other charges on behalf of the Fund as the
Investment Advisor shall deem reasonable in the circumstances taking into
account all such factors as it deems relevant, including the quality of research
and other services made available to it (even if such services are not for the
exclusive benefit of the Fund). It is understood that the costs of such services
will not necessarily represent the lowest costs available and that the
Investment Advisor is under no obligation to combine or arrange orders so as to
obtain reduced charges.
4. Investments for the Accounts of Others and Allocation of
Opportunities.
(a) It is understood that the Investment Advisor and its
directors, officers, employees and principals may from time to time purchase and
sell securities or other investment assets for their own accounts, for the
accounts of their families, for the account of any entity in which they have a
beneficial interest or for the accounts of others for whom they may provide
investment advisory or other services (collectively, "Managed Accounts"),
notwithstanding the fact that the Fund may have or may take an investment
position in the same security; provided, however, that the Investment Advisor
shall not cause the Fund to purchase any asset from or sell any asset to the
Investment Advisor, or any of its directors, officers, employees or principals
or any account or entity controlled by such persons without the consent of the
Fund.
(b) It is understood that when the Investment Advisor
determines that it would be appropriate for the Fund and one or more Managed
Accounts to participate in an investment opportunity, the Investment Advisor
will seek to execute orders for the Fund and for such Managed Accounts on an
equitable basis. In such situations, the Investment Advisor may place orders for
the Fund and each Managed Account simultaneously, and if all such orders are not
filled at the same price, the Investment Advisor may cause the Fund and each
Managed Account to pay or receive the average of the prices at which the orders
were filled for the Fund and all Managed Accounts. If all such orders cannot be
fully executed under prevailing market conditions, the Investment Advisor may
allocate the securities traded among the Fund and the Managed Accounts in a
manner which it considers equitable, taking into account the size of the order
placed for the Fund and each such Managed Account as well as any other factors
which it deems relevant.
(c) The Investment Advisor will not organize any other
investment fund with the same objectives as the Fund (other than a parallel U.S.
limited partnership for U.S. investors) unless at least sixty percent (60%) of
the capital of the Fund has been invested in portfolio securities consistent
with the Fund's objectives.
Page 16 of 35 Pages
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5. Compensation.
(a) For its services hereunder, the Investment Advisor shall
be entitled to receive a quarterly management fee from the Fund at an annual
rate equal to 1.75% of the Net Value of the Fund (as defined in the Memorandum).
The management fee shall be calculated and payable in arrears after the end of
each calendar quarter based on the Net Value of the Fund as of the end of the
calendar quarter. The management fee shall be paid promptly to the Investment
Advisor after the close of each calendar quarter.
(b) In addition to the management fee, once the Fund has made
aggregate distributions to holders of its Common Shares equal to their initial
investment plus a 7% non-compounded annual return (the "Preferred Return"), then
the Investment Advisor will receive distributions in its capacity as holder of
the Fund's Founders Shares until it has received cumulative distributions equal
to a 1.75% non-compounded annual return on the Fund's capital, and thereafter
distributions will be made 80% to holders of Common Shares of the Fund and 20%
to the Investment Advisor in its capacity as holder of Founders Shares, in each
case as provided in the Memorandum and in the Articles and Memorandum of
Association of the Fund.
6. Scope of Liabilities. The Investment Advisor shall not be liable to
the Fund, its affiliates or shareholders for any losses, damages, expenses or
claims occasioned by any act or omission of the Investment Advisor in connection
with the performance of its services hereunder, other than as a result of its
own willful misconduct, gross negligence or reckless disregard of its duties
hereunder, or as otherwise required by applicable law.
7. Indemnification. The Fund shall indemnify the Investment Advisor
(which shall include solely for purposes of this Section 9 any of its directors,
officers, employees and shareholders) against and hold them harmless from any
expense, loss, liability or damage arising out of any claim asserted or
threatened to be asserted by any third party, in connection with the Investment
Advisor's serving or having served as such pursuant to this Agreement; provided,
however, that the Investment Advisor shall not be entitled to indemnification
with respect to any expense, loss, liability or damage which was caused by its
own gross negligence, willful misconduct or reckless disregard of its duties
hereunder. The Fund shall advance to the Investment Advisor the reasonable costs
and expenses of investigating and/or defending any such claim, subject to
receiving a written undertaking from the Investment Advisor to repay any such
amounts advanced to it in the event and to the extent of any subsequent
determination that the Investment Advisor was not entitled to indemnification
hereunder. In the event that the Investment Advisor is or becomes a party to any
action or proceeding in respect of which indemnification may be sought
hereunder, the Investment Advisor shall promptly notify the Fund thereof.
Following such notice, the Fund shall be entitled to participate therein and, to
the extent that it may wish, to assume the defense thereof with counsel
reasonably satisfactory to the Investment Advisor. After notice from the Fund to
the Investment Advisor of an election so to assume the defense thereof, the Fund
will not be liable to the Investment Advisor hereunder for any legal or other
expenses subsequently incurred by the Investment Advisor in connection with the
defense thereof other than reasonable costs of investigation unless counsel for
the Investment Advisor shall reasonably determine that there is a conflict of
interest which requires separate representation of the parties. The Fund shall
not be liable hereunder for any settlement of any action or claim effected
without its written consent thereto, which consent shall not be unreasonably
withheld, nor shall the Fund enter into any settlement which shall impose any
obligation on the Investment Advisor without its written consent.
8. Independent Contractor. For all purposes of this Agreement, the
Investment Advisor shall be an independent contractor and not an employee or
agent of the Fund, nor shall anything herein be construed as making the Fund a
partner or co-venturer with the Investment Advisor or any of its affiliates.
Except as provided in this Agreement, the Investment Advisor shall not have
authority to bind,
Page 17 of 35 Pages
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obligate or represent the Fund. Without limiting the generality of the
foregoing, the Investment Advisor shall have no authority whatsoever (nor shall
it have any duty) on behalf of the Fund to: (i) communicate with shareholders of
the Fund or with the general public; (ii) solicit sales of the Shares of the
Fund or accept subscriptions therefor; (iii) maintain the principal corporate
records or books of account of the Fund; (iv) disburse payments of dividends,
legal and accounting fees, and directors' and officers' salaries; or (v) make
redemptions of the shares of the Fund.
9. Information Concerning Activities. The Investment Advisor shall send
or arrange that there be sent to the Fund confirmations of all transactions for
its account. The Investment Advisor shall also furnish from time to time such
further information and reports concerning the activities undertaken by the
Investment Advisor on behalf of the Fund as the Fund may reasonably request.
10. Expenses. All expenses incurred directly in connection with
transactions effected or positions held on behalf of the Fund pursuant to the
Investment Advisor's exercise of its duties hereunder (including, without
limitation, custodial fees, clearing fees, brokerage commissions, interest and
commitment fees on loans and debit balances, withholding or transfer taxes and
other expenses as described in the Memorandum) shall be paid or reimbursed by
the Fund. The Investment Advisor shall bear its own overhead and other internal
operating costs, except that the Investment Advisor may cause certain of such
expenses to be paid out of brokerage commissions generated by trading on behalf
of the Fund as described in the Memorandum.
11. Term, Termination, Renewal and Survival.
(a) The initial term of this Agreement shall commence on the
date hereof and shall continue until the final dissolution and liquidation of
the Fund, subject to termination by either party upon not less than thirty (30)
days prior written notice to the other in the event of any material breach by
the other party of its obligations under this Agreement, which breach is not
remedied within such period.
(b) In the event of the termination of this Agreement, (i) the
Investment Advisor shall be entitled to the management fee accrued through the
date of termination, (ii) the provisions of Sections 6 and 7 shall survive any
termination, and (iii) the Investment Advisor shall have the right, at its
option, to resell the Founders Shares to the Fund at a purchase price equal to
the accrued but unpaid distributions due to the holders of Founders Shares
through the date of such termination based upon the Net Value of the Fund (as
defined in the Memorandum) as of such date.
12. Modification; Waiver. Except as otherwise expressly provided
herein, this Agreement shall not be amended nor shall any provision of this
Agreement be considered modified or waived unless evidenced by a writing signed
by the parties to be charged with such amendment, waiver or modification.
13. Entire Agreement; Binding Effect; Assignment. This Agreement
represents the entire agreement among the parties, shall be binding upon and
inure to the benefit of the parties hereto and their respective successors, and
their rights and obligations hereunder shall not be assignable, transferable or
delegable without the written consent of the other party hereto. Any attempted
assignment, transfer or delegation hereof without such consent shall be void.
14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Cayman Islands, without giving effect to
conflicts of law.
15. Counterparts. This Agreement may be signed in any number of
counterparts. Any single counterpart or a set of counterparts signed in either
case by the parties hereto shall constitute a full and original agreement for
all purposes.
Page 18 of 35 Pages
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first written above.
NETWORK FUND III, LTD.
By: /s/ P. Bailey
--------------------------------
Name: P. Bailey
Title: Director
GILDEA MANAGEMENT COMPANY
By: /s/ William P. O'Donnell
--------------------------------
Name: William P. O'Donnell
Title: Vice President
Page 19 of 35 Pages
<PAGE>
EXHIBIT 3
Page 20 of 35 Pages
<PAGE>
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT made as of this 22nd of April, 1997, by
and among The General Chemical Group Inc., a Delaware corporation (the
"Company") and the persons listed on Appendix A hereto (each a "Holder" and
collectively, the "Holders" together with any person defined as a "Holder" under
Section 1.03(b) of this Agreement).
W I T N E S S E T H:
WHEREAS, the Holders have acquired from Stonor Group Limited ("Stonor")
an aggregate of 3,100,000 shares of the common stock, par value $.01 per share
("Common Stock"), of the Company (the "Shares") pursuant to a Stock Purchase
Agreement dated as of even date herewith;
WHEREAS, the Company and Stonor are parties to that certain Stockholder
Agreement dated as of May 15, 1996 (the "Original Agreement") pursuant to which,
among other things, the Company has granted to Stonor certain registration
rights with respect to the Shares;
WHEREAS, immediately prior to the execution of this Agreement, the
Company and Stonor are terminating the Original Agreement; and
WHEREAS, the Company and the Holders desire to enter into this
Agreement to provide for certain registration rights on the part of the Holders.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I. REGISTRATION RIGHTS
Section 1.01. Shelf Registration: "Piggy-Back" Registration Rights
(a) If, at any time after the date hereof and prior to the
second anniversary of the date hereof, a majority in interest of the Holders (as
hereinafter defined) shall notify the Company in writing that they intend to
offer or cause to be offered for public sale all or any portion of their
Registrable Securities (as hereinafter defined), the Company will use its best
efforts to cause such of the Registrable Securities as may be requested by the
Holders to be registered under the Securities Act of 1933, as amended (the
"Securities Act"), pursuant to a registration statement on Form S-3 (or any
comparable successor form) (a "Registration Statement") for sale on a delayed or
continuous basis under Rule 415 under the Securities Act, and to keep such
registration effective until the earlier of the second anniversary of the date
hereof or the date on which all of such Holders' Registrable Securities
registered thereunder are sold; provided, however, that the Company shall have
no obligation to file a Registration Statement pursuant to this Section 1.01(a)
prior to May 15, 1997. If the Company shall not then be entitled to utilize Form
S-3 for any requested registration of Registrable Securities, the Company shall
effect any requested registration on such form of registration statement as the
Company shall then be entitled to utilize. All Registration Expenses (as
hereinafter defined) of such registration and offerings attributable to any
registration pursuant to this Section 1.01(a) shall be borne by the Company. The
Company may postpone the filing of any Registration Statement required under
this Section 1.01(a) for a reasonable period of time, not to exceed 120 days if
a Suspension Event (as hereinafter defined) has occurred and is continuing. The
Company shall not be required to cause a Registration Statement requested
pursuant to this Section 1.01(a) to become effective prior to 120 days following
the effective date of a registration statement initiated by the Company, if the
request for registration has been received by the Company subsequent to the
giving of written notice by the Company, made in good faith, to the Holders to
the
Page 21 of 35 Pages
<PAGE>
effect that the Company is commencing to prepare a company-initiated
registration statement (other than a registration effected solely to implement
an employee benefit plan or a transaction to which Rule 145 or any other similar
rule of the Securities and Exchange Commission (the "Commission") under the
Securities Act is applicable); provided, however, that the Company shall use its
best efforts to achieve such effectiveness promptly. The Company represents and
warrants to each of the Holders that (i) no Suspension Event has occurred and it
is not aware of any facts or circumstances which would cause a Suspension Event
to occur on or prior to May 15, 1997 and (ii) it has no current intention of
filing with the Commission (as hereinafter defined) a company-initiated
registration statement.
(b) If at any time or times after the date hereof, the Company
shall determine or be required to register any shares of its Common Stock for
sale under the Securities Act (whether in connection with a public offering of
securities by the Company (a "primary offering"), a public offering of
securities by stockholders of the Company (a "secondary offering"), or both (but
not in connection with a registration (i) effected solely to implement an
employee benefit plan or a transaction to which Rule 145 or any other similar
rule of the Commission under the Securities Act is applicable or (ii) in
connection with the registration of preferred stock or debt securities of the
Company which are convertible into or exchangeable for shares of Common Stock)),
the Company will promptly give written notice thereof to each of the Holders. In
connection with any such registration, if within 20 days after the receipt of
such notice one or more Holders of Registrable Securities (as hereinafter
defined), request the inclusion of some or all of the Registrable Securities
(but not any other shares) held by them in such registration, the Company will
use its best efforts to effect the registration under the Securities Act of all
Registrable Securities which such Holders request to be registered in a writing
delivered to the Company within 20 days after such Holders' receipt of the
notice referred to above. In the case of the registration of shares of Common
Stock by the Company in connection with an underwritten public offering, (i) the
Company shall not be required to include any Registrable Securities in such
underwriting unless the Holders thereof accept the terms of the underwriting as
agreed upon between the Company and the underwriter or underwriters selected by
it, and (ii) if the underwriter(s) determines that marketing factors require a
limitation on the number of Registrable Securities to be offered, the Company
shall not be required to register Registrable Securities of the Holders in
excess of the amount, if any, of shares of the capital stock which the principal
underwriter of such underwritten offering shall reasonably and in good faith
agree to include in such offering in excess of any amount to be registered for
the Company, and in the event of any such limitation the number of Registrable
Securities of any Holder requesting inclusion in such registration shall be
based upon the relative holdings of Common Stock of all Holders requesting such
registration (and if any Holder would thus be entitled to include more
Registrable Securities as such Holder requested to be registered, the excess
shall be allocated among other requesting Holders pro rata based upon their
relative holdings of Common Stock). All Registration Expenses relating to the
registration and offering of Registrable Securities pursuant to this Section
1.01(b) shall be borne by the Company.
Section 1.02. Selection of Underwriter. If the Holders so elect, the
offering of Registrable Securities pursuant to a registration statement filed
under this Article I shall be in the form of an underwritten offering. If they
so elect, the Company shall select one or more nationally recognized firms of
investment bankers to act as the book-running managing underwriter or
underwriters in connection with such offering and shall select any additional
investment bankers and managers to be used in connection with the offering.
Section 1.03. Definitions.
(a) Registrable Securities. For the purposes of this Agreement, the
term "Registrable Securities" shall mean (i) the Shares and (ii) any shares of
Common Stock issued or issuable with respect to any of such Shares by way of a
stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization; provided,
however, that any of
Page 22 of 35 Pages
<PAGE>
the foregoing that are sold in a registered sale pursuant to an effective
registration statement under the Securities Act or that may be sold without
restriction pursuant to Rule 144(k) under the Securities Act (as confirmed by an
unqualified opinion of counsel to the Company) shall not be deemed Registrable
Securities.
(b) Holders. For purposes of this Agreement, the term "Holder" shall
mean any holder of Registrable Securities from time to time, including, without
limitation, (i) the Holders signatory to this Agreement and (ii) any subsequent
transferees of such Holders of Registrable Securities.
(c) The term "Registration Expenses" shall mean all expenses incident
to the Company's performance of or compliance with this Agreement, including
without limitation, all Commission and stock exchange or National Association of
Securities Dealers, Inc. registration and filing fees and expenses, fees and
expenses of compliance with securities or blue sky laws (including reasonable
fees and disbursements of counsel for the underwriters in connection with blue
sky qualifications of the Registrable Securities), printing expense, messenger
and delivery expense, internal expenses including without limitation, all
salaries and expense of its officers and employees performing legal or
accounting duties), the fees and expenses incurred in connection with the
listing of the securities to be registered on each securities exchange on which
securities are listed, fees and disbursements of counsel for the Company and all
independent certified public accountants (including the expense of any annual
audit or "cold comfort" letters required by or incident to such performance and
compliance), the fees and disbursements of underwriters customarily paid by
issuers or sellers of securities, the reasonable fees and expenses of any
special experts retained by the Company in connection with such registration and
- -fees and expenses of other persons retained by the Company (but not including
(i) any underwriting discounts or commissions attributable to the sale of
Registrable Securities by Holders of such Registrable Securities, (ii) any
transfer taxes payable by the Holders of Registrable Securities in connection
with the sale of Registrable Securities and (iii) the fees of counsel retained
in connection with each such registration by any of the Holders).
Section 1.04. Further Obligations of the Company. Whenever under the
preceding Sections of this Article I the Company is required hereunder to
register any Registrable Securities, it agrees that it shall also do the
following:
(a) Use its best efforts (with due regard to the management of
the ongoing business of the Company) to diligently prepare and file with the
Commission a Registration Statement on Form S-3 or comparable successor form and
such amendments and supplements to said Registration Statement and the
prospectus used in connection therewith as may be necessary to keep said
Registration Statement effective and to comply with the provisions of the
Securities Act with respect to the sale of securities covered by said
Registration Statement until the earlier of the second anniversary of the date
hereof or the date on which all of the Holders' Registrable Securities have been
sold;
(b) Use its best efforts to continue to qualify at all times
for registration of its capital stock on Form S-3 or a comparable successor
form;
(c) Furnish to each selling Holder such copies of each
preliminary and final prospectus and such other documents as such Holder may
reasonably request to facilitate the sale of such Holder's Registrable
Securities;
(d) Enter into any reasonable underwriting agreement required
by the underwriter selected pursuant to Section 1.02 on terms satisfactory to
the Company and the Holders;
(e) Use its best efforts to register or qualify the securities
covered by said registration statement under the securities or "blue-sky" laws
of such jurisdictions as any selling Holders may
Page 23 of 35 Pages
<PAGE>
reasonably request, provided that the Company shall not be required to register
or qualify the securities in any jurisdictions which require it to qualify to do
business or subject itself to general service of process therein;
(f) immediately notify each selling Holder, at any time when a
prospectus relating to such Holder's Registrable Securities is required to be
delivered under the Securities Act, of the happening of any event as a result of
which such prospectus contains an untrue statement of a material fact or omits
any material fact necessary to make the statements therein not misleading, and,
at the request of any such selling Holder, prepare a supplement or amendment to
such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain any untrue statement of
a material fact or omit to state any material fact necessary to make the
statements therein not misleading;
(g) Cause all such Registrable Securities to be listed on each
securities exchange or quoted in each quotation system on which similar
securities issued by the Company are then listed or quoted;
(h) Otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission and make generally available
to its security holders, in each case as soon as practicable, but not later than
45 days after the close of the period covered thereby (90 days in case the
period covered corresponds to a fiscal year of the Company), an earnings
statement of the Company which will satisfy the provisions of Section 11(a) of
the Securities Act; and
(i) Obtain and furnish to each selling Holder, immediately
prior to the effectiveness of the registration statement (and, in the case of an
underwritten offering, at the time of delivery of any Registrable Securities
sold pursuant thereto), a cold comfort letter from the Company's independent
public accountants in the same form and covering the same matters as is
typically delivered to underwriters and, in the event that an underwriter or
underwriters have been retained in connection with such registration, such cold
comfort letter to be provided to the selling Holders shall be the same cold
comfort letter delivered to such underwriter or underwriters.
Section 1.05. Stop Orders; Sale Notices; Suspension of Registration
Requirement.
(a) The Company shall promptly notify each Holder of, and
confirm in writing, the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose. The Company shall use reasonable best efforts to
obtain the withdrawal of any order suspending the effectiveness of the
Registration Statement as soon as is practicable.
(b) Notwithstanding anything to the contrary set forth in this
Agreement, the Company's obligation under this Agreement to use best efforts to
cause a Registration Statement and any filings with any state securities
commission to be made or to become effective or to amend or supplement
Registration Statement shall be suspended in the event and during such period
pending negotiations relating to, or consummation of, a transaction or the
occurrence of an event if the Company has been advised by legal counsel that
such filing, amendment or supplement would require a special audit or the
disclosure of a material impending transaction or other matter and the Company
determines reasonably and in good faith that such disclosure would have a
material adverse effect on the Company (such circumstances being hereinafter
referred to as a "Suspension Event"), but such suspension shall continue only
for so long as such event or its effect is continuing. The Company shall have
the right to withdraw and terminate any effective Registration Statement if a
Suspension Event has occurred and is continuing; provided, however, that upon
the conclusion of such Suspension Event the Company shall promptly file a new
Registration Statement with respect to any Registrable Securities then
outstanding and to keep such
Page 24 of 35 Pages
<PAGE>
registration effective for the time period prescribed by Section 1.01(a), which
Registration Statement shall be subject to all of the terms and conditions of
this Agreement.
(c) Each Holder whose Registrable Securities are covered by a
Registration Statement agrees, if requested by the managing underwriter or
underwriters in an underwritten offering (an "Underwritten Offering"), not to
effect any public sale or distribution of any of the securities of the Company
of any class included in such Underwritten Offering, including a sale pursuant
to Rule 144 or Rule 144A under the Securities Act (except as part of such
Underwritten Offering), during the 15-day period prior to, and during the
120-day period beginning on, the date of pricing of each Underwritten Offering,
to the extent timely notified in writing by the Company or the managing
underwriters (or the Company on behalf of such managing underwriters).
Section 1.06. Notice of Sales; Black-Out Period. Following the
effectiveness of the Registration Statement and any filings with any state
securities commissions, the Holders agree that they will not effect any sales of
the Registrable Securities pursuant to the Registration Statement or any such
filings at any time unless they have provided to the Company written notice of
such proposed sale not later than one (1) business day prior to such proposed
sale and the Company has notified such selling Holder that no Suspension Event
has occurred and is continuing. If the Company notifies the selling Holder that
a Suspension Event has occurred and is continuing, the Company will notify such
selling Holder as soon as practicable after the termination of such Suspension
Event and any necessary supplements or amendments to the Registration Statement
have been made pursuant to Section 1.04.
Section 1.07. Indemnification; Contribution.
(a) Incident to any registration statement referred to in this
Agreement, and subject to applicable law, the Company will indemnify and hold
harmless each underwriter, each Holder of Registrable Securities (including its
respective directors, officers, employees and agents) so registered, and each
person who controls any of them within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder (the "Exchange Act"), from and
against any and all losses, claims, damages, expenses and liabilities, joint or
several (including any investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted), to which they, or any of them, may become
subject under the Securities Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities arise out of or are based on (i) any untrue
statement or alleged untrue statement of a material fact contained in such
registration statement (including any related preliminary or definitive
prospectus, or any amendment or supplement to such registration statement or
prospectus), (ii) any omission or alleged omission to state in such document a
material fact required to be stated in it or necessary to make the statements in
it not misleading, or (iii) any violation or alleged violation by the Company of
the Securities Act, any state securities or "blue sky" laws or any rule or
regulation thereunder in connection with such registration, provided, however,
that the Company will not be liable to such underwriter, Holder or controlling
person to the extent that such loss, claim, damage, expense or liability arises
from and is based on (A) an untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with information
furnished in writing to the Company by such underwriter, Holder or controlling
person expressly for use in such registration statement or (B) any preliminary
prospectus, to the extent that any such loss, claim, damage or liability results
solely from an untrue statement of a material fact contained in, or the omission
of a material fact from, such preliminary prospectus which untrue statement or
omission was corrected in the final prospectus, if the Company shall sustain the
burden of proving that a Holder sold Registrable Securities to the person
alleging such loss, claim, damage or liability without sending or giving, at or
prior to the written confirmation of such sale, a copy of the final prospectus.
With respect to such untrue statement or omission or alleged untrue statement or
omission in the information furnished in writing to the Company
Page 25 of 35 Pages
<PAGE>
by such Holder expressly for use in such registration statement, such Holder
will indemnify and hold harmless each underwriter, the Company (including its
directors, officers, employees and agents), each other Holder of Registrable
Securities (including its respective directors, officers, employees and agents)
so registered, and each person who controls any of them within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, expenses and liabilities, joint or
several, to which they, or any of them, may become subject under the Securities
Act, the Exchange Act or other federal or state statutory law or regulation, at
common law or otherwise to the same extent provided in the immediately preceding
sentence. In no event, however, shall the liability of a Holder for
indemnification under this Section 1.07(a) exceed the lesser of (i) that
proportion of the total of such losses, claims, damages or liabilities
indemnified against equal to the proportion of the total Registrable Securities
sold under such registration statement which is being sold by such Holder or
(ii) the proceeds received by such Holder from its sale of Registrable
Securities under such registration statement.
(b) If the indemnification provided for in Section 1.07(a)
above for any reason is held by a court of competent jurisdiction to be
unavailable to an indemnified party in respect of any losses, claims, damages,
expenses or liabilities referred to therein, then each indemnifying party under
this Section 1.07, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, expenses or liabilities in such
proportion as is appropriate to reflect the relative fault of the Company, the
selling Holders and the underwriters in connection with the statements or
omissions which resulted in such losses, claims, damages, expenses or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company, the selling Holders and the underwriters shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company, the selling
Holders or the underwriters and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The Company, the Holders, and the underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 1.07(b) were determined
by pro rata or per capita allocation or by any other method of allocation which
does not take account of the equitable considerations referred to in the
immediately preceding sentences. In no event, however, shall a Holder be
required to contribute any amount under this Section 1.07(b) in excess of the
lesser of (i) that proportion of the total of such losses, claims, damages or
liabilities indemnified against equal to the proportion of the total Registrable
Securities sold under such registration statement which is being sold by such
Holder or (ii) the proceeds received by such Holder from its sale of Registrable
Securities under such registration statement. No person found guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(c) The indemnification and contribution provided for in this
Section 1.07 will remain in full force and effect regardless of any
investigation made by or on behalf of the indemnified parties or any officer,
director, employee, agent or controlling person of the indemnified parties.
Section 1.08. Rule 144 Requirements. The Company will use its best
efforts to file with the Commission such information as the Commission may
require under the reporting requirements of Sections 13 and 15(d) of the
Exchange Act; and the Company shall use its best efforts to take all action as
may be required as a condition to the availability of Rule 144 or Rule 144A
under the Securities Act (or any successor or similar exemptive rules hereafter
in effect). The Company shall furnish to any Holder of Registrable Securities
upon request a written statement executed by the Company as to the steps it has
taken to comply with the current public information requirement of Rule 144 or
Rule 144A or such successor rules.
Page 26 of 35 Pages
<PAGE>
Section 1.09. Transfer of Registration Rights. The registration rights
and related obligations under this Article I of each of the Holders with respect
to any of its Registrable Securities may be assigned by it, and upon such
transfer the relevant transferee shall be deemed to be included within the
definition of a "Holder" solely for purposes of this Article I. The transferring
Holder and any subsequent transferee shall notify the Company at the time of
such transfer.
ARTICLE II. MISCELLANEOUS.
Section 2.01. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without regard
to the conflicts of law principles thereof.
Section 2.02. Further Assurances. Each of the parties hereto agrees to
execute all such further instruments and documents and to take all such further
action as any other party may reasonably require in order to effectuate the
terms and purposes of this Agreement.
Section 2.03. Rights of Third Parties. Except as set forth in Section
1.09, nothing expressed or implied in this Agreement is intended or shall be
construed to confer upon or give any person or entity other than the parties
hereto any rights or remedies under or by reason of this Agreement.
Section 2.04. Counterparts. This Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be
taken to be an original and all such counterparts shall be taken to constitute
one and the same document.
Section 2.05. Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be in any way
impaired thereby, it being intended that all of the rights and privileges of the
Holders shall be enforceable to the fullest extent permitted by law.
Section 2.06. Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and is intended to be the
complete and exclusive statement of the agreement and understanding of the
parties hereto in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
Section 2.07. Attorneys' Fees. In any action or proceeding brought to
enforce any provision of this Agreement or where any provision hereof is validly
asserted as a defense, the successful party shall, to the extent permitted by
applicable law, be entitled to recover reasonable attorneys' fees in addition to
any other available remedy.
Section 2.08. Remedies. In the event of a breach or a threatened breach
by any party to this Agreement of its obligations under this Agreement, any
party injured or to be injured by such breach will be entitled to specific
performance of its rights under this Agreement or to injunctive relief, in
addition to being entitled to exercise all rights provided in this Agreement and
granted by law. The parties agree that the provisions of this Agreement shall be
specifically enforceable, it being agreed by the parties that the remedy at law,
including monetary damages, for objection in any action for specific performance
or injunctive relief that a remedy at law would be adequate is waived.
Page 27 of 35 Pages
<PAGE>
Section 2.09. Representations and Warranties of the Company. The
Company hereby represents and warrants to each of the Holders as follows:
(a) The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware.
(b) The Company has full corporate power and authority to
enter into this Agreement and to carry out the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of the Company. This Agreement constitutes the
legal and binding obligation of the Company enforceable against the Company in
accordance with its terms except as such enforceability may be limited by (i)
applicable bankruptcy, insolvency, moratorium, reorganization, fraudulent
conveyance or similar laws in effect which affect the enforcement of creditors
rights generally, (ii) general principles of equity, whether considered in a
proceeding at law or in equity and (iii) state or federal securities laws or
policies relating to the non-enforceability of the indemnification or
contribution provisions contained herein.
(c) The execution and delivery and performance by the Company
of the Agreement and the transactions contemplated hereby do not and will not
violate the charter or by-laws of the Company or any contract or other agreement
to which the Company is a party or by which its assets are bound or any laws,
rules, regulations of any jurisdiction applicable to the Company or require the
Company to obtain any approval, consent or waiver of, or to make any filing
with, any person or entity (governmental or otherwise).
Page 28 of 35 Pages
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
THE GENERAL CHEMICAL GROUP, INC.
By: /s/ Ralph M. Passino
-----------------------------------
Name: Ralph M. Passino
Title: Vice President
Page 29 of 35 Pages
<PAGE>
HOLDERS:
If a corporation, partnership, trust or entity:
MASSMUTUAL Life Ins. Co.
----------------------------------------------------
Name of Holder
By: /s/ Mark A. Ahmed
Name: Mark A. Ahmed
Title: Managing Director
If a corporation, partnership, trust or entity:
MASSMUTUAL Corporate Value Partners*
----------------------------------------------------
Name of Holder
By: /s/ Mark A. Ahmed
Name: Mark A. Ahmed
Title: Managing Director
* By MASSMUTUAL Life Ins. Co., its
Investment Manager
If a corporation, partnership, trust or entity:
MASSMUTUAL High Yield Partners LLC*
----------------------------------------------------
Name of Holder
By: /s/ Mark A. Ahmed
Name: Mark A. Ahmed
Title: Managing Director
* By HYP Management, Inc. as Manager
If a corporation, partnership, trust or entity:
JO Hambro & Partners Ltd. a/c North
Altantic Smaller Companies Investment
Trust plc
----------------------------------------------------
Name of Holder
By: /s/ Claudia Perkins
Name: Claudia Perkins
Title: Director
Page 30 of 35 Pages
<PAGE>
If a corporation, partnership, trust or entity:
JO Hambro & Partners Ltd. a/c
American Opportunity Trust PLC
----------------------------------------------------
Name of Holder
By: /s/ Claudia Perkins
Name: Claudia Perkins
Title: Director
If a corporation, partnership, trust or entity:
JO Hambro & Partners Ltd. Main Account
----------------------------------------------------
Name of Holder
By: /s/ Claudia Perkins
Name: Claudia Perkins
Title: Claudia Perkins
If a corporation, partnership, trust or entity:
JO Hambro & Partners Ltd. a/c Isle of Man
----------------------------------------------------
Name of Holder
By: /s/ Claudia Perkins
Name: Claudia Perkins
Title: Director
If a corporation, partnership, trust or entity:
Bank of Bermuda (Guernsey) Limited
----------------------------------------------------
Name of Holder
By: /s/ C.M. Butt
Name: C.M. Butt
Title: Officer Operatoins
By: /s/ D. Cherry
Name: D. Cherry
Title: Senior Settlements Administrator
Page 31 of 35 Pages
<PAGE>
If a corporation, partnership, trust or entity:
The Tail Wind Fund Ltd.
----------------------------------------------------
Name of Holder
By: /s/ Michael M. Darville
Name: Michael M. Darville
Title: Director
By: /s/ Anita M. Donalds
Name: Anita M. Donalds
Title:
If a corporation, partnership, trust or entity:
Chelverton Fund Ltd.
----------------------------------------------------
Name of Holder
By: /s/ James Morton
Name: R.J.P. Morton
Director of European American
Securities, Inc. Manager of the
Title: Chelverton Fund
If a corporation, partnership, trust or entity:
Equitable Life Assurance Society
----------------------------------------------------
Name of Holder
By: /s/ Paul Gaunt
Name: Paul Gaunt
Title: Assistant General Manager
If a corporation, partnership, trust or entity:
Swiss Bank Corporation (Luxembourg) Ltd.
----------------------------------------------------
Name of Holder
By: /s/ Authorized Signatory
Name: Authorized Signatory
Title:
Page 32 of 35 Pages
<PAGE>
If a corporation, partnership, trust or entity:
Waterstock Asset Management Ltd.
----------------------------------------------------
Name of Holder
By: /s/ Jan Lundqvist
Name: Jan Lundqvist
Title: MD
If a corporation, partnership, trust or entity:
First Chicago Capital Corporation
----------------------------------------------------
Name of Holder
By: /s/ Geoffrey L. Stringer
Name: Geoffrey L. Stringer
Title: Chairman and CEO
If a corporation, partnership, trust or entity:
EOS Partners LP
----------------------------------------------------
Name of Holder
By: /s/ Steven M. Friedman
Name: Steven M. Friedman
Title: General Partner
If a corporation, partnership, trust or entity:
C.S.L. Associates, L.P.
----------------------------------------------------
Name of Holder
By: /s/ Charles S. Lipson
Name: Charles S. Lipson
Title: General Partner
If a corporation, partnership, trust or entity:
NUFI
----------------------------------------------------
Name of Holder
By: /s/ David B. Pinkerton
Name: David B. Pinkerton
Title: Vice President
If a corporation, partnership, trust or entity:
Page 33 of 35 Pages
<PAGE>
Network Fund III, Ltd.
----------------------------------------------------
Name of Holder
By: /s/William P. O'Donnell
Name: William P. O'Donnell
Title: Managing Partner
If An Individual:
/s/ John W. Gildea
----------------------------------------------------
Name:
If a corporation, partnership, trust or entity:
Gildea Investment Company Defined
Benefits Plan
----------------------------------------------------
Name of Holder
By: /s/ John W. Gildea
Name: John W. Gildea
Title:
If An Individual:
/s/ William P. O'Donnell
----------------------------------------------------
Name:
If An Individual:
/s/ Steven L. and Stephanie D. Volla JT
----------------------------------------------------
Name:
Page 34 of 35 Pages
<PAGE>
APPENDIX A
Number of
Name of Holder Registrable Securities
- -------------- ----------------------
MASSMUTUAL Long Term Pool 138,450
MASSMUTUAL Corporate Value Partners Limited 69,250
MASSMUTUAL High Yield Partners LLC 92,300
North Atlantic Smaller Companies 275,000
American Opportunity Trust 100,000
JO Hambro & Partners - Main Account 8,000
JO Hambro & Partners - Isle of Man Account 2 42,000
ORYX International Growth Fund 75,000
The Tail Wind Fund Ltd. 19,000
The Chelverton Fund Limited 6,000
Equitable Life Assurance Society 650,000
Swiss Bank Corporation (Luxemborg) SA Luxemborg 225,000
Banque Edouard Constant SA, Geneva 25,000
First Chicago Capital Corporation 500,000
EOS Partners, LP 50,000
CSL Associates, LP 15,000
NUFI 150,000
Network Fund III, Ltd. 500,000
John W. Gildea 75,000
Gildea Investment Company Defined Benefit Plan 25,000
William P. O'Donnell 10,000
Steven L. Volla and Stephanie D. Volla JT 50,000
Total: 3,100,000
=========
Page 35 of 35 Pages
